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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-K
/X/ ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE FISCAL YEAR ENDED September 30, 1996
-------------------------------------
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OF 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM to
Commission File Number 0-24708
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AMCON Distributing Company
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(Exact name of Registrant as specified in its charter)
Delaware 47-0702918
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(State or other jurisdiction (I.R.S. Employer of
incorporation or organization) identification No.)
10228 "L" Street, Omaha NE 68127
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(Address of principal executive offices)
Registrant's telephone number, including area code: (402) 331-3727
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Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on
which registered
None None
---------------- -----------------
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.01 Par Value
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(Title of class)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 of 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 Registrants' knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-K
or any other amendment to this Form 10-K. / /
The aggregate market value of equity securities held by non-affiliates
of the Registrant on December 13, 1996 was approximately $978,019.
As of December 13, 1996 there were 2,445,903 shares of common stock
outstanding.
- Documents Incorporated by Reference -
---------------------------------------
Portions of the 1996 Annual Report to Stockholders are incorporated
therein by reference into Parts I, II and IV. Portions of the Proxy
Statement pertaining to the March 12, 1997 Annual Stockholders' Meeting
are incorporated herein by reference into Part III.
1
AMCON DISTRIBUTING COMPANY
--------------------------
1996 FORM 10-K ANNUAL REPORT
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Table of Contents
Page
----
PART I
Item 1. Business.........................................................3
Item 2. Properties.......................................................7
Item 3. Legal Proceedings................................................9
Item 4. Submission of Matters to Vote of Security Holders................9
Item 4A. Executive Officers of the Company................................9
PART II
Item 5. Market for the Registrant's Common Stock and Related
Stockholder Matters.............................................10
Item 6. Selected Financial Data.........................................10
Item 7. Management's Discussion of Analysis of Financial
Condition and Results of Operations.............................11
Item 8. Financial Statements and Supplementary Data.....................11
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure.............................11
PART III
Item 10. Directors and Executive Officers of the Registrant..............11
Item 11. Executive Compensation................................ .........11
Item 12. Security Ownership of Certain Beneficial Owners and
Management......................................................12
Item 13. Certain Relationships and Related
Transactions....................................................12
PART IV
Item 14. Exhibits, Financial Statement Schedules and
Reports on Form 8-K..............................................13
2
PART I
ITEM 1. BUSINESS
GENERAL
AMCON Distributing Company ("ADC" or the "Company") is a distributor of
consumer products in the Great Plains and Rocky Mountain regions. The
Company serves approximately 11,000 retail outlets and is ranked by the U.S.
Distribution Journal as the twenty-fifth largest distributor of such products
in the United States based on 1995 sales volume. The Company pursued a
strategy of growth through acquisition from 1981 through 1993. Since 1993,
the Company has focused on increasing operating efficiency by merging smaller
branch distribution facilities into larger ones. In addition, the Company
has controlled growth through expansion of its market area into contiguous
regions and by introduction of new product lines to customers.
The Company distributes approximately 10,000 different consumer
products, including cigarettes and tobacco products, candy and other
confectionery, soft drinks and other beverages, groceries, paper products,
health and beauty care products and institutional food service products.
ADC's principal suppliers include Philip Morris, RJR Nabisco, Lorillard,
Brown & Williamson, Liggett Group, Hershey, Mars, William Wrigley and
Planters-Lifesavers. The Company also markets private label lines of
cigarettes, tobacco, snuff and candy products. While cigarettes accounted
for approximately 64% of the Company's sale volume during its most recent
fiscal year, the Company continues to diversify its product line in an
attempt to lessen the Company's dependence on cigarette sales.
The Company has over 11,000 customers and no single account
represented more than 6% of ADC's total revenues during fiscal 1996. The
Company distributes products primarily to retailers such as convenience
stores, discount and general merchandise stores, grocery stores and
supermarkets, drug stores and gas stations. In addition, the Company
services institutional customers, including restaurants and bars, schools,
sports complexes and vendors, as well as other wholesalers.
The Company has sought to increase sales to convenience stores and
petroleum marketers by adopting a number of operating strategies which it
believes gives it a competitive advantage with these types of retailers.
One key operating strategy is a commitment to customer service. In a
continuing effort to provide better service than its competitors, the Company
carries a broad and diverse product line which allows the Company to offer
"one-stop shopping" to its customers. The Company offers both full-service
and self-service health and beauty programs and offers grocery products which
have proven to be profitable to convenience store customers. In addition,
the Company has a policy of next-day delivery and employs a concept of
selling products in cut-case quantities or "by the each" (i.e., individual
units). ADC also offers planograms to convenience store customers to assist
in the design of a store and display of products in the store.
3
The Company has worked to improve its operating efficiency by investing
in the latest in systems technology, including computerization of buying and
financial control functions. The Company has also sought to reduce inventory
expenses by improving the number of times its inventory is renewed during a
period ("inventory turns") for the same level of sales. Inventory turns
improved from 16.3 times in fiscal 1994 and 17.5 times in fiscal 1995 to 21.2
times in fiscal 1996. By keeping its operating costs down, the Company is
better able to price its products in such a manner to achieve an advantage
over less efficient distributors in its market areas.
The Company has nine distribution centers located in Colorado, Kansas,
Missouri, Nebraska, North Dakota, South Dakota, and Wyoming. These
distribution centers contain a total of approximately 307,450 square feet of
floor space and employ state-of-the-art equipment for the efficient
distribution of the large and diverse product mix sold by the Company. The
Company also operates a fleet of approximately 110 delivery vehicles, ranging
from half-ton vans to over-the-road vehicles with refrigerated trailers.
ADC was incorporated in Delaware in 1986 to carry on the business of
General Tobacco and Candy Company ("General Tobacco"), a Nebraska corporation
which was the predecessor to ADC. General Tobacco began operation in 1981.
Since 1981, the Company has acquired 19 consumer product distributors in the
Great Plains and Rocky Mountain regions. In June 1993, ADC acquired Sheya
Brothers Specialty Beverages, Inc. ("Sheya Brothers"), a beer, malt beverage
and "New Age" beverage distribution company, serving metropolitan Denver.
Effective September 29, 1995, ADC sold the "New Age" beverage distribution
business to Vancol Industries, Inc., but retained the beer and malt beverage
business. Effective October 4, 1996, ADC sold the beer and malt beverage
business in Denver, Colorado to Western Distributing Company and closed the
Denver facility.
PRINCIPAL PRODUCTS
CIGARETTES AND TOBACCO. Sales of cigarettes and the gross margin derived
therefrom for the fiscal years ending September 30, 1996, 1995, and 1994 are
set forth below:
(Dollars in Millions)
Fiscal Year Ended September 30,
------------------------------------
1996 1995 1994
------ ------ ------
Sales $112.5 $108.7 $108.8
Gross Margin 10.8 11.4 13.1
Gross Margin Percentage 9.6% 10.5% 12.0%
4
Revenues from the sale of cigarettes during fiscal 1996 increased by
approximately 3.5% as compared to fiscal 1995, while gross profit from the
sale of cigarettes declined by 5.4% during the same period (see "MANAGEMENT'S
DISCUSSION AND ANALYSIS-Results of Operations-Year Ended September 30, 1996
Versus Year Ended September 30, 1995" in the Annual Report to Stockholders
for the Fiscal Year Ended September 30, 1996). Sales of cigarettes
represented approximately 64% of the Company's sales volume during fiscal
1996.
ADC has sought to position itself to capitalize on consumer demand for
discount or value-priced cigarettes by marketing its own private label
cigarette. Substantial price increases implemented by manufacturers of
premium cigarettes during the last decade resulted in a demand for private
label cigarettes, which are sold at lower prices than premium brands. The
Company began marketing private label cigarettes in 1983 as a high-quality,
value-priced alternative to premium cigarettes. Since 1988, ADC's private
label cigarettes have been manufactured under an exclusive agreement with a
division of Philip Morris Incorporated. This agreement was renewed in
October 1993 for a term of five years. However, the Company may terminate
the agreement on each anniversary thereof.
Faced with a significant loss of market share, many premium brand
manufacturers, including Philip Morris and RJR Nabisco, began to lower the
prices on their premium cigarettes beginning in 1993. While a price
differential continues to exist between the premium cigarettes and the
Company's private label cigarettes at the retail level, the price reductions
on premium cigarettes have been primarily responsible for a significant
reduction in demand for private label cigarettes. The Company believes that
there will be a continued demand for the Company's private label cigarettes
and that its cigarettes have established brand loyalty among consumers,
however, it is anticipated that the volume of private label cigarette sales
could decline by as much as 10% to 20% in fiscal 1997. In an effort to
stabilize its market share, the Company introduced a brand extension
consisting of box packages for three of its private label cigarette products
in the second quarter of fiscal 1996.
In addition to cigarettes, the Company also distributes other tobacco
products, including cigars, snuff and chewing tobacco. Sales of these types
of products were approximately $14.2 million during fiscal 1996 and
represented approximately 8.1% of the Company's total sales volume during the
year. The Company began marketing private label snuff and chewing tobacco in
July 1992 under a manufacturing agreement with Superior Value Tobacco
Company, a division of Swisher International Inc. ("Swisher").
CONFECTIONERY. Candy and related confectionery items constitute ADC's
second largest-selling product line, representing approximately 11.7% of the
Company's total sales volume during fiscal 1996. Sales of confectionery
items and the gross margin derived therefrom for the fiscal years ending
September 30, 1996, 1995 and 1994 are set forth below:
5
(Dollars in Millions)
Fiscal Year Ended September 30,
-------------------------------------
1996 1995 1994
------ ------ ------
Sales $20.6 $19.4 $19.6
Gross Margin 3.0 2.5 2.8
Gross Margin Percentage 14.6% 13.1% 14.5%
The Company supplies customers with over 1,800 different types of candy
and related products, including chocolate bars, chewing gum, peanuts and
cough drops. Major brand names include products manufactured by Hershey
(Reese's, Kit Kat and Hershey), Mars (Snickers, M&M's and Milky Way), William
Wrigley and Planters-Lifesavers. The Company also markets its own private
label candy under a manufacturing agreement with Willmar Cookie & Nut
Company.
OTHER PRODUCT LINES. Over the past six years, ADC's strategy has been
to expand its portfolio of consumer products in order to better serve its
customer base. ADC's other product lines include water, soft drinks and
other beverages, groceries, paper products, health and beauty care products
and institutional food products. In fiscal 1996, ADC's sales of these
product lines increased slightly to $28.9 million compared to $28.8 million
in fiscal 1995. This increase was the result of a 20% increase in sales of
other products in the Springfield, Missouri distribution center due to
expansion of the customer base. This increase more than offset a $1.8
million reduction in sales of nonalcoholic beverages due to downsizing the
Denver facility in September 1995. During fiscal 1996 the gross profit
margin on these types of products was 17.7%, compared to a 9.6% margin on
cigarette and tobacco products.
COMPETITION
The distribution business is highly competitive. There are many
distribution companies operating in the same geographical regions as the
Company, and competition in the distribution industry is intense. ADC's
principal competitors are national wholesalers such as McLane Co., Inc.
(Temple, Texas) and regional wholesalers such as Minter-Weisman Co.
(Minneapolis, Minnesota) and Farner-Bocken (Carroll, Iowa) along with a host
of smaller grocery and tobacco wholesalers. Most of these competitors
generally offer a wide range of products at prices comparable to the
Company's. Therefore, the Company seeks to distinguish itself from its
competitors by offering a higher level of customer service.
GOVERNMENT REGULATION
Various state government agencies regulate the distribution of
cigarettes and tobacco products in several ways, including the imposition of
excise taxes, licensing and bonding requirements. Complying with these
regulations is a very
6
time-consuming, expensive and labor-intensive undertaking. For example, each
state (as well as certain cities and counties) require the Company to collect
excise taxes ranging from $1.20 to $4.80 per carton on all cigarettes sold by
it in the state. Such excise taxes must be paid in advance and, in most
states, is evidenced by a stamp which must be affixed to each package of
cigarettes.
EMPLOYEES
As of September 30, 1996, the Company had 400 full-time and part-time
employees in the following areas:
Managerial 13
Administrative 52
Sales & Marketing 98
Warehouse 159
Delivery 78
---
Total Employees 400
===
None of the Company's employees are subject to any collective bargaining
agreements with the Company and management believes its relations with its
employees are good.
ITEM 2. PROPERTIES
The location and approximate square footage of the nine principal
distribution centers operated by ADC as of September 30, 1996 are set forth
below:
Location Square Feet
-------- -----------
Aberdeen, South Dakota 13,500
Bismarck, North Dakota 9,600
Casper, Wyoming 15,000
Denver, Colorado 41,000
Hutchinson, Kansas 31,950
Olathe, Kansas 7,500
Omaha, Nebraska 70,300
Rapid City, South Dakota 21,600
Springfield, Missouri 97,000
-------
Total 307,450
=======
ADC owns its distribution facility in Bismarck, North Dakota. The
Company owns one other building that is no longer used as distribution
facility and is
7
listed for sale. Each of these facilities is subject to a first mortgage
securing borrowings under the Company's revolving credit facility (see
"MANAGEMENT'S DISCUSSION AND ANALYSIS-Liquidity and Capital Resources" in the
Annual Report to Stockholders for the Fiscal Year Ended September 30, 1996).
The Company leases its remaining distribution facilities, various
offices and certain equipment under noncancelable operating leases. Leases
for the eight distribution facilities leased by the Company have terms
expiring from 1996 to 2002. Minimum future lease commitments for these
properties and equipment total approximately $2,237,000 as of September 30,
1996. Minimum payments will be reduced by minimum sublease rentals totaling
$107,532 due in the future under noncancelable subleases.
Effective October 15, 1996, the Company closed its Denver facility and
subleased the remaining 41,000 square feet of facility to the tenant who
occupies the other one-half of the building. Also, effective November 1,
1996, the Company vacated its 31,950 square foot Hutchinson distribution
facility and leased a 3,500 square foot facility which operates as a cross-dock
distribution point. Management believes that its existing facilities
are adequate for the Company's present level of operations and will be
capable of accommodating the Company's anticipated growth.
In addition, the Company owns a condominium in the Cayman Islands which
had a book value of approximately $838,000 as of September 30, 1996. The
Company uses the condominium in furtherance of its business strategies and is
evaluating the costs and benefits associated with retaining the condominium.
The Company and AMCON Corporation, the former parent of the Company,
purchased the condominium in 1990 for total consideration of $1,099,250. Of
this amount, the Company paid $474,970 in cash. AMCON Corporation paid the
remaining $624,280 and financed $550,000 of this amount through a loan from a
bank which was evidenced by a note (the "Note") and was secured by a first
mortgage on the condominium.
AMCON Corporation transferred its ownership interest in the condominium
to the Company as of September 30, 1992 at its net book value of $591,596 in
partial payment of an intercompany debt owed by AMCON Corporation to the
Company. AMCON Corporation made all payments on the Note prior to the
transfer of the condominium to the Company. On the date of transfer, the
outstanding principal balance of the Note was $424,822 and the Company
recorded a subordinated note payable to AMCON Corporation of an equal amount.
The terms of the subordinated note were the same as the terms of the Note and
the Company made payments on the subordinated note by making payments on
behalf of AMCON Corporation to the bank holding the Note. The Note was
repaid in full in April 1996.
The Company owns the condominium in fee simple. However, under an
agreement with AMCON Corporation, the greater of the first $400,000 of the
net gain or one-half of the net gain from the ultimate sale of this property
will be allocated to AMCON Corporation. See "CERTAIN TRANSACTIONS."
8
ITEM 3. LITIGATION AND REGULATORY PROCEEDINGS.
The Company is subject to claims and litigation in the ordinary course
of its business. However, in the opinion of management, no currently pending
legal proceedings or claims against the Company will, individually or in the
aggregate, have a material adverse effect on the Company's financial
condition or results of operations. The Company believes that all of its
real property is in compliance with all regulations regarding the discharge
of toxic substances into the environment and is not aware of any condition at
its properties that could have a material adverse affect on its financial
condition or results of operations. In that regard, the Company has not been
notified by any governmental authority of any potential liability or other
claim in connection with any of its properties.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There were no matters submitted to a vote of all security holders during
the fourth quarter ended September 30, 1996.
ITEM 4A. EXECUTIVE OFFICERS OF THE COMPANY.
The Company's day-to-day affairs are managed by its executive officers,
who are appointed by the Board of Directors for terms of one year. The
Company has entered into employment agreements with Mr. Wright and Ms. Evans,
each with a term expiring on December 31, 1997. Mr. Howard performs his
duties under the terms of a consulting agreement which expires on December
31, 1997. The executive officers of ADC are as follows:
Name Age Position
---- --- --------
William F. Wright 54 Chairman of the Board and Chief
Corporate Officer, Director
Kathleen M. Evans 49 President and Chief Executieve
Officer, Director
J. Tony Howard 52 Executive Vice President
and Secretary, Director
Michael D. James 35 Chief Financial Officer and
Treasurer
Chris M. Pudenz 29 Controller and Assistant
Secretary
WILLIAM F. WRIGHT has served as the Chairman and Chief Executive Officer
of AMCON Corporation (the former parent of ADC) since 1976 and as Chairman
9
of the Company since 1981. From 1968 to 1984, Mr. Wright practiced
corporate and securities law in Lincoln, Nebraska. Mr. Wright is a graduate
of the University of Nebraska and Duke University School of Law and is a
certified public accountant. Mr. Wright is also a director of Gold Banc
Corporation, Inc.
KATHLEEN M. EVANS became President and Chief Executive Officer of ADC in
February 1991. Prior to that time she served as Vice President of AMCON
Corporation from 1985. From 1978 until 1985, Ms. Evans acted in various
capacities with AMCON Corporation and its operating subsidiaries.
J. TONY HOWARD has served as President of Nebraska Distributing Company
("NDC") since 1978. NDC is engaged in the beer and wine wholesaling business
and is a wholly owned subsidiary of AMCON Corporation, the former parent of
the Company. In February 1991, Mr. Howard was appointed as Secretary and
Treasurer of the Company, and in 1993 he became the Executive Vice-President
of the Company. He served as Treasurer until June 1994.
MICHAEL D. JAMES became Chief Financial Officer and Treasurer of ADC in
June 1994. He is a certified public accountant and is responsible for all
financial functions within the Company. Prior to joining ADC, Mr. James
practiced accounting for ten years with the firm of Price Waterhouse, serving
as the senior tax manager of the Omaha, Nebraska office from 1992 until 1994.
Mr. James graduated from Kansas State University in 1983.
CHRIS M. PUDENZ joined ADC in August 1993 as Controller and Assistant
Secretary. Mr. Pudenz is a certified public accountant, and before joining
the Company he served in the audit and international consulting practices of
Price Waterhouse for four years. He graduated from Creighton University in
1989.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER
MATTERS.
The information required by this item is incorporated by reference from
the Annual Report to Stockholders for the fiscal year ended September 30,
1996 under the heading "Market for Common Stock" on page 4.
ITEM 6. SELECTED FINANCIAL DATA.
The information required by this item is incorporated by reference from
the Annual Report to Stockholders for the fiscal year ended September 30,
1996 under the heading "Selected Financial Data" on pages 2 and 3.
10
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS.
The information required by this item is incorporated by reference from
the Annual Report to Stockholders for the fiscal year ended September 30,
1996 under the heading "Managements Discussion and Analysis" on pages 5
through 11.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The financial statements and accompanying notes, together with the
report of independent accountants are incorporated by reference from the
Annual Report to Stockholders for the fiscal year ended September 30, 1996 on
pages F-1 through F-19.
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.
The Registrant's Proxy Statement to be used in connection with the
Annual Meeting of Stockholders to be held on March 12, 1997, contains under
the caption "Election of Directors" certain information required by Item 10
of Form 10-K and such information is incorporated herein by this reference.
The information required by Item 10 of Form 10-K as to executive officers is
set forth in Item 4A of Part I hereof.
During the Company's most recent fiscal year, Matthew F. Wright and Mark
A. Wright, each of which is a more than ten percent owner of the Company's
outstanding Common Stock failed to file, on a timely basis, Statement of
Changes of Beneficial Ownership (Form), as required by section 16(a) of the
Securities Exchange Act of 1934, as amended. None of these failures resulted
in any transactions with respect to the Common Stock of the Company being
unreported.
ITEM 11. EXECUTIVE COMPENSATION.
The Registrant's Proxy Statement to be used in connection with the
Annual Meeting of Stockholders to be held on March 12, 1997, contains
under the captions "Compensation of Directors", Compensation of Executive
Officers" and "Compensation Committee Interlocks and Insider Participation",
the information required by Item 11 of Form 10-K, and such information is
incorporated herein by this reference. The information set forth under the
11
captions "Report of Compensation Committee on Executive Compensation" and
"Company Performance" is expressly excluded from such incorporation.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
The Registrant's Proxy Statement to be used in connection with the
Annual Meeting of Stockholders to be held on March 12, 1997, contains under
the caption "Voting Securities and Beneficial Ownership Thereof by Principal
Stockholders, Directors and Officers" the information required by Item 12 of
Form 10-K and such information is incorporated herein by this reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
In January 1995, the Company made an advance of $125,000 to William F.
Wright, Chairman of the Board, Chief Corporate Officer and a principal
shareholder of the Company. This advance was recorded as a note receivable,
bearing interest at 7.5%, and was due September 30, 1996. The interest rate
on the note was retroactively amended during the year to 9.0%. The balance
of the note receivable, plus accrued interest was $144,695 at September 30,
1996. Subsequent to September 30, 1996, the terms of the note were amended
to require installments of $25,000 in January 1997, $50,000 in June 1997 and
the balance in September 1997.
Prior to February 25, 1994, the Company was a subsidiary of AMCON
Corporation, which owned 87.5% of the issued and outstanding shares of the
Company's Common Stock. AMCON Corporation's other principal asset is a
subsidiary corporation that is engaged in the beer distribution business in
Omaha, Nebraska. As a condition to obtaining an additional distribution
franchise with a major U.S. beer brewery, AMCON Corporation agreed to divest
its interest in the Company. Therefore, on February 25, 1994, AMCON
Corporation distributed its shares of the Company's Common Stock to the
shareholders of AMCON Corporation who, as a result, became shareholders of
the Company.
AMCON Corporation engages in certain transactions with the Company,
including the provision of offices and administrative services by AMCON
Corporation to the Company. The cost of the shared facilities are
apportioned between them based on their respective usages thereof and on
terms no less favorable than would otherwise be available from unaffiliated
parties. The Company was charged $60,000, $60,000, and $60,000 by AMCON
Corporation during the years ended September 30, 1996, 1995, and 1994,
respectively, as consideration for such services, which is included in the
Company's selling, general and administrative expenses for those years.
In September 1992, the Company was the maker of a junior subordinated
promissory note in the amount of $424,822 to AMCON Corporation. The note was
repaid in full in April 1996. Interest on the loan was 3.0% over prime rate.
Amounts paid to AMCON Corporation on this note were applied by AMCON
12
Corporation to principal and interest payments on the first mortgage loan
secured by the condominium in the Cayman Islands.
The Company borrowed $550,000 from Allen D. Petersen, a director and
principal shareholder of the Company, in June 1993 in connection with the
acquisition of Sheya Brothers. See "BUSINESS-General." This loan was repaid
in November 1993. Interest on the loan was payable at an annual rate equal
to 2% over Mr. Petersen's cost of funds. In connection with the loan, the
Company issued Mr. Petersen a warrant to purchase 61,250 shares of the
Company's Common Stock (as adjusted for the stock split of approximately 214
to one declared on June 2, 1994) at an exercise price equal to the per share
book value of the Company as of the end of the most recent quarter. The
warrant expired on May 28, 1996.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
(A) FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
(1) FINANCIAL STATEMENTS
The following financial statements of AMCON Distributing Company are
incorporated by reference under Item 8. The Annual Report to
Stockholders for the Fiscal Year Ended September 30, 1996 is attached
as Exhibit 13.
Reference Page
Annual Stockholders
Report
Report of Independent Accountants F-1
Balance Sheets as of September 30, 1996
and 1995 F-2
Statements of Income for the Years Ended
September 30, 1996, 1995, and 1994 F-3
Statements of Shareholders' Equity for the Years
Ended September 30, 1996, 1995 and 1994 F-4
Statements of Cash Flows for the Years Ended
September 30, 1996, 1995 and 1994 F-6
Notes to Financial Statements F-7
(2)FINANCIAL STATEMENT SCHEDULES
Report of Independent Accountants S-1
Schedule II - Valuation and Qualifying Accounts S-2
13
(B) EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
3.1 Restated Certificate of Incorporation of the Company (incorporated
by reference to Exhibit 3.1 of the Company's Registration
Statement on Form S-1 (Registration No. 33-82848) filed on August
15, 1994)
3.2 Bylaws of the Company (incorporated by reference to Exhibit 3.2 of
the Company's Registration Statement on Form S-1 (Registration No.
33-82848) filed on August 15, 1994)
4.1 Specimen Common Stock Certificate (incorporated by reference to
Exhibit 4.1 of the Company's Registration Statement on Form S-1
(Registration No. 33-82848) filed on August 15, 1994)
10.1 Grant of Exclusive Manufacturing Rights, dated October 1, 1993,
between the Company and Famous Value Brands, a division of Philip
Morris Incorporated, including Private Label Manufacturing
Agreement and Amended and Restated Trademark License Agreement
(incorporated by reference to Exhibit 10.1 of Amendment No. 1 to
the Company's Registration Statement on Form S-1 (Registration No.
33-82848) filed on November 8, 1994)
10.2 Credit and Security Agreement, dated July 25, 1994, between the
Company and Norwest Bank Minnesota, National Association
(incorporated by reference to Exhibit 10.4 of the Company's
Registration Statement on Form S-1 (Registration No. 33-82848)
filed on August 15, 1994)
10.3 AMCON Distributing Company 1994 Stock Option Plan (incorporated by
reference to Exhibit 10.7 of the Company's Registration Statement
on Form S-1 (Registration No. 33-82848) filed on August 15, 1994)
10.4 AMCON Distributing Company Profit Sharing Plan (incorporated by
reference to Exhibit 10.8 of Amendment No. 1 to the Company's
Registration Statement on Form S-1 (Registration No. 33-82848)
filed on November 8, 1994)
10.5 Employment Agreement, dated July 1, 1994, between the Company and
William F. Wright (incorporated by reference to Exhibit 10.9 of
the Company's Registration Statement on Form S-1 (Registration No.
33-82848) filed on August 15, 1994)
10.6 Employment Agreement, dated July 1, 1994, between the Company and
Kathleen M. Evans (incorporated by reference to Exhibit 10.9 of
the Company's Registration Statement of Form S-1 (Registration No.
33-82848) filed on August 15, 1994)
14
10.7 Consulting Agreement, dated July 1, 1994, between the Company and
Nebraska Distributing Company relating to services of J. Tony
Howard (incorporated by reference to Exhibit 10.10 of the
Company's Registration Statement on Form S-1 (Registration No. 33-
82848) filed on August 15, 1994)
11.1 Statement re: computation of per share earnings
13.1 Annual Report to Stockholders for the Fiscal Year Ended September
30, 1996.
27.0 Financial Data Schedules
(b) REPORTS ON FORM 8-K
No reports on Form 8-K were filed by the Company during the fourth
quarter ended September 30, 1996.
15
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities Act of
1934, the Registrant, AMCON Distributing Company, a Delaware corporation, has
duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Omaha, State of Nebraska, on the
23rd day of December, 1996.
AMCON DISTRIBUTING COMPANY
By: /s/ Kathleen M. Evans
----------------------
Kathleen M. Evans, President
16
Pursuant to the requirements of the Securities Act of 1934, this report
has been signed below by the following persons in the capacities indicated on
the 23rd day of December, 1996.
Signature Title
--------- -----
/s/ William F. Wright Chairman of the Board, Chief
- ------------------------ Corporate Officer and Director
William F. Wright
/s/ Kathleen M. Evans Chief Executive Officer, President
- ------------------------ (Principal Executive Officer) and
Kathleen M. Evans Director
/s/ Michael D. James Chief Financial Officer and
- ------------------------ Treasurer (Principal Financial and
Michael D. James Accounting Officer)
/s/ J. Tony Howard Executive Vice President,
- ------------------------ Secretary and Director
J. Tony Howard
/s/ Allen D. Petersen Director
- ------------------------
Allen D. Petersen
/s/ William R. Hoppner Director
- ------------------------
William R. Hoppner
17