SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to S240.14a-11(c) or S240.14a-12
THE NEW PARAHO CORPORATION
Payment of Filing Fee (check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
1) Title of each class of securities to which transaction
transaction applies: _________________________________
2) Aggregate number of securities to which transaction
applies: _____________________________________________
3) Per unit price of other underlying values of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth
the amount on which the filing fee is calculated and
state how it was determined):
___________________________________________________________
4) Proposed maximum aggregate value of transaction:
___________________________________________________________
5) Total fee paid:
___________________________________________________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offset fee was paid previously. Identify the previous
filing by registration statement number, or the Form or
Schedule and the date of its filing.
1) Amount Previously Paid: ________________________________
2) Form, Schedule or Registration Statement No.:
___________________________________________________________
3) Filing Party: __________________________________________
4) Date Filed: ____________________________________________
THE NEW PARAHO CORPORATION
A Colorado Corporation
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
__________________
December 4, 1998
The annual meeting of shareholders of The New Paraho
Corporation (the "Company") will be held at the Holiday Inn, 800
28th Street, Boulder, Colorado, on Friday, December 4, 1998 at
11:00 a.m. The following items will be brought before the
shareholders:
1. To elect a Board of Directors consisting of 10 members to
hold office until the next annual meeting of share-
holders or until their successors shall be elected and
shall qualify.
2. To consider and act upon a proposal to ratify the
selection of Hein + Associates as independent auditors of
the Company.
3. To transact such other business as may properly come
before the meeting or any adjournments thereof.
Only holders of common stock of record at the close of
business on October 23, 1998 are entitled to notice of and to vote
at the meeting or any adjournment thereof. Shareholders are
cordially invited to attend the meeting. All shareholders, whether
or not they expect to attend the meeting in person, are requested
to complete, date, and sign and return the enclosed Proxy in the
enclosed envelope. Should you attend the meeting, you may vote in
person even though you have given a Proxy.
By order of the
Board of Directors
Joseph L. Fox
President
THE NEW PARAHO CORPORATION
PROXY STATEMENT
Annual Meeting of Shareholders
To Be Held December 4, 1998
In General
This statement is furnished in connection with the
solicitation of proxies by the Board of Directors of The New
Paraho Corporation (hereinafter the "Company"), Suite 104, 5387
Manhattan Circle, Boulder, Colorado 80303, to be used at the Annual
Meeting of Shareholders (the "Meeting") to be held at the Holiday
Inn, 800 28th Street, Boulder, Colorado 80303, on Friday, December
4, 1998 at 11:00 a.m., for the purposes set forth in the
accompanying Notice of Annual Meeting of Shareholders. This
statement was sent to shareholders on or about October 30, 1998.
The shares covered by the enclosed Proxy, if such is
properly executed and received by the Board of Directors prior to
the Meeting, will be voted in favor of the proposals considered at
the Meeting, unless such Proxy specifies otherwise, or the
authority to vote on the election of directors has been withheld.
A Proxy may be revoked at any time before it is exercised by giving
written notice to the secretary of the Company, or by executing a
Proxy bearing a later date. Shareholders may vote their shares in
person if they attend the Meeting even if they have executed and
returned a Proxy.
The matters to be brought before the Meeting are the
election of directors to serve for the ensuing year, ratification
of the appointment of Hein + Associates as independent auditors for
the Company, and any other business as may properly come before the
Meeting or any adjournment thereof.
Persons Making this Solicitation
This proxy is solicited on behalf of the Board of
Directors of the Company. This solicitation will be made
predominately by mail. The expense of such solicitation will be
borne by the Company and will include reimbursement paid to
brokerage firms and others for their expenses in forwarding
solicitation material regarding the Meeting to beneficial owners.
Further solicitation of proxies may be made, if necessary, by
telephone or oral communication with some shareholders of the
Company following the original solicitation. All such further
solicitation will be made by regular employees of the Company, who
will not be additionally compensated therefore, or by the Company's
transfer agent, in which case the cost will be borne by the
Company.
Voting Securities
Shareholders of record at the close of business on
October 23, 1998 will be entitled to vote at the Meeting. As of
that date, there were 50,772,982 shares of the Company's $.01 par
value common stock (the "Common Stock") issued and outstanding,
each share being entitled to one vote. The Company has no other
class of voting securities. The Company's Bylaws provide that one-
third of the outstanding shares of the Common Stock entitled to
vote, represented in person or by Proxy, shall constitute a quorum
at any shareholders' meeting. If a quorum exists, action on a
matter other than the election of directors is approved if the
votes cast favoring the action exceed the votes cast opposing the
action. In the election of directors, that number of candidates
equaling the number of directors to be elected, having the highest
number of votes cast in favor of their election, are elected to the
board of directors. Abstentions and broker non-votes will have no
effect on the voting. Cumulative voting is not allowed in the
election of directors or for any other purpose.
At the Meeting, the shareholders will elect 10 members to
the Board of Directors. In the absence of instructions to the
contrary, the proxy holders will vote the shares represented by
each of the nominees listed below to be able to serve as a
director. If any nominee should become unavailable, however, it is
intended that the proxy will vote for a substitute designated by
management.
Amount and Nature of Beneficial Ownership
The following table shows the ownership at September 10,
1998 of the Company's $0.01 par value common stock by each director
of the Company, each person known by the Company to own
beneficially more than five percent of the outstanding shares of
common stock, by all named executive officers, and by all directors
and officers of the Company as a group:
Amount and Nature
of Beneficial Ownership Percent
of Common Stock of Class
Beneficial Owner
Energy Resources Technology 41,784,562 82%
Land, Inc. ("ERTL")(1)(4)
5387 Manhattan Circle, #104
Boulder, CO 80303
Larry A. Lukens --- ---
Adam Reeves 46,186 *
William J. Murray, Jr. 63,280 *
Theo Ertl 42,080,562(1)(2) 82.87%(1)(2)
Joseph L. Fox 41,858,562(1)(3) 82.44%(1)(3)
Jann Ertl --- ---
Jill Ertl --- ---
Twig Ertl 20,000 *
Buff Ertl Palm 12,100 *
Peter Richard 3,000 *
All Directors and Officers
as a group (10 persons) 218,566 83.31%
_____________________________________________________________________________
* Indicates ownership of less than 1% of the class.
(1) Theo Ertl and Joseph L. Fox are trustees of the Theo Ertl
Revocable Trust, which holds 83% of the voting stock of ERTL.
Because of their positions and ownership, Theo Ertl and Joseph L.
Fox have the power to affect the manner in which ERTL votes or
disposes of the shares of the Company owned by ERTL.
(2) Theo Ertl is the trustee of the Buff Ertl White Trust, the
Jill Ertl Esbensen Trust, the Jann Ertl Trust, and the Twig Ertl
Trust, each of which owns 74,000 shares of the Company's common
stock. As trustee of these trusts, Theo Ertl has the power to
affect the manner in which the trusts vote or dispose of the shares
of the Company owned by the trusts.
(3) Joseph Fox is the majority shareholder of JLF Investments,
Inc., which owns 74,000 shares of the Company's stock.
Election of Directors
(Proposal 1)
The entire Board of Directors is to be elected with each
director to hold office until the next annual meeting or until his
successor is elected and qualified. The persons named as proxies
in the enclosed proxy have been designated by management and intend
to vote for the election of the Board of Directors the persons
named below, except where authority is withheld by the shareholder.
Each of the nominees has consented to be named herein and to
serve if elected. However, if any nominee at the time of election
is unable or unwilling to serve as a director or is otherwise
unavailable for election, the shares represented by proxies will be
voted for the election of such person as the Board of Directors may
designate or, in absence of such designation, for a nominee
selected by the proxy agent named in the enclosed form of proxy.
The following table contains information concerning the
nominees to the Board of Directors of the Company as well as
information concerning all executive officers of the Company.
DIRECTORS
POSITION WITH OR OFFICER BUSINESS
NAME AGE WITH COMPANY (1) SINCE EXPERIENCE(2)
Theo Ertl 81 Chairman of the Board 1986 President, ERTL;
of Director and Executive Vice
member Executive President, Lake
Committee Eldora Corp.
William J. Murray, 83 Director 1974 (3) Petroleum
Jr. Engineer, Energy
Consultant
Adam A. Reeves 81 Director and member 1971 (3) Vice President
of Audit Committee Treasurer of
Paraho Devel.
Corp. 1971-81
Joseph L. Fox 60 President, Chief 1986 (3) Executive Vice
Executive Officer, President, ERTL;
Director, and member President, Lake
Executive Committee Eldora Corp.
Larry A. Lukens 59 Director 1982 (3) President,
Sevier Mfg, Inc.
Jann Ertl 53 Vice President, 1986 Vice President,
Director ERTL; Vice
Pres., Lake
Eldora Corp.
Peter L. Richard 50 Director and member 1980-88, Managing
Audit Committee 1990 (3) Director, Quasar
Corporation
Jill Ertl 55 Vice President, 1986 Vice President,
Director ERTL; Vice
Pres., Lake
Eldora Corp.
Twig Ertl 51 Treasurer, Director 1986 Treasurer, ERTL;
Treasurer, Lake
Eldora Corp.
Buff Ertl Palm 58 Secretary, Director 1986 Secretary, ERTL;
and member Audit Secretary Lake
Committee Eldora Corp.
(1) Each director named above is elected to serve until the
next annual meeting of the Company's shareholders, and
each officer is elected to serve at the pleasure of the
Company's Board of Directors or until his successor has
been duly elected and qualified or until his earlier
death or resignation. All officers have served in the
indicated positions since July 23, 1986.
(2) Business experience shown is for the last five years
unless otherwise indicated. Peter Richard holds a
directorship in Guest Supply Inc. and Ashland Global
Securities, which are publicly held companies.
(3) Dates given indicate beginning dates for such persons as
directors of Paraho Development Corporation, to which the
Company is successor by merger.
The Company has an Executive Committee and an Audit Committee.
The Executive Committee has authority to act for the Board of
Directors in most matters. The Audit Committee has power to
appoint an outside auditor and to review internal financial
controls. The Audit and Executive Committees each have held one
meeting since the last annual meeting.
The Board of Directors has held three meetings since the
beginning of its last fiscal year. All members of the Board of
Directors attended at least 75% of regularly scheduled and special
meetings of the Board of Directors and the committees on which they
serve.
Buff Ertl Palm, Jann Ertl, Jill Ertl, and Twig Ertl are all
children of Theo Ertl, the co-Trustee of the Tell Ertl Family
Trust, of which each of the children is a beneficiary.
Remuneration and Other Transactions with Management and Others
Executive and Director Compensation
The following table indicates the compensation paid to
directors and officers in the last three fiscal years:
Salaries,
Salaries, Fees, Fees, Bonuses
Directors' Fees, for Services
Name of Individuals Capacities in Commissions, Preformed in
or Number of Which Served Bonuses for Services Prior Fiscal
Persons in Group Performed in: Years
1998 1997 1996
_______________________________________________________________________________
Joseph L. Fox President, Chief $ 0 $ 0 $ 0 (1)
Executive Officer
Larry A. Lukens Executive Vice $ 0 $ 0 $63,000 (1)
President, Chief
Operating Officer
and Director
All Directors Not Applicable $ 0 $ 0 $63,000 (1)
and Executive
Officers as a
Group (10 Persons)
_______________________________________________________________________________
(1) Other compensation received is less than 10% of the
indicated amount.
Mr. Lukens employment was terminated as of December 31, 1995,
in accordance with his employment agreement as amended on January
1, 1991. Compensation included a monthly base salary of $8,000 and
a discretionary monthly bonus of up to $2,500.
The Company paid no other compensation pursuant to any type of
employee benefit or compensation plans in the last fiscal year.
Directors' Compensation
Directors of the Company receive no remuneration from the
Company. The Company does reimburse directors for expenses
incurred in attending board meetings.
Certain Relationships and Related Transactions
Theo Ertl, Joseph L. Fox, Jann Ertl, Jill Ertl, Twig Ertl and
Buff Ertl Palm are all either directors, officers or five-percent
or greater shareholders, or a combination of the above, of ERTL.
Theo Ertl, Jann Ertl, Jill Ertl, Twig Ertl and Buff Ertl Palm
are all beneficiaries of the Tell Ertl Family Trust (the "Trust").
Joseph L. Fox and Theo Ertl are trustees of the Trust. The Trust
had extended a $5,500,000 line of credit to the Company, the
remaining balance of which currently is due on July 1, 1999. As of
June 30, 1995, the Company had drawn substantially all of the funds
available under this line of credit. At that time, in recognition
of the Company's inability to repay the interest on this note, the
Trust waived unpaid interest accrued to date and eliminated further
interest accruals. The Company had used the line of credit to fund
the Asphalt Feasibility Program. On December 18, 1996, the Company
used funds from the annual principal payment received on its note
receivable from The Oil Shale Corporation to reduce the principal
amount of the note payable to the Trust. Also on that date, New
Paraho executed an assignment to the Trust of its interest in the
note receivable, in the amount of $3,083,120. These payments, in
addition to two other principal payments to the Trust during fiscal
year 1997 have reduced the total amount outstanding on the line of
credit to $865,596.
Certain Colorado oil shale land (the "Mahogany Land"), which
the Company mined for purposes of the Asphalt Feasibility Program,
is owned 37 1/2% by the Trust, 37 1/2% by certain trusts of which
Jann Ertl, Jill Ertl, Twig Ertl, Buff Ertl Palm and others are
beneficiaries (the "Children's Trusts"). The other 25% is owned by
unrelated parties. The trustees of the Trust, the trustee of the
Children's Trusts and the remaining owners have agreed to grant the
Company the right, at no cost, to extract sufficient oil shale from
the Mahogany Land to conduct the Asphalt Feasibility Program. If
the Asphalt Feasibility Program is successful, the Company would
negotiate with the trustees of the Trust, the trustee of the
Children's Trusts and the remaining owners for additional mining
rights. Any ore that is extracted will be accounted for so as to
reflect the comparable cost of extracting the oil shale from
property owned by unrelated parties.
Ratification of Auditors
(Proposal 2)
The independent certified public accounting firm of Hein +
Associates completed the audit of the financial statements of the
Company for the year ended June 30, 1998.
Representatives of Hein + Associates are expected to be
present at the annual meeting and available to respond to
appropriate questions. They will be given an opportunity to make
a statement if they so desire.
This matter is submitted to a vote of the shareholders because
the Board of Directors believes that shareholders should have an
opportunity to express their views on the matter. If this
appointment is not ratified by the shareholders, the Audit
Committee of the Board of Directors may reconsider its selection.
Deadline for Receipt of Shareholder Proposals for Annual
Meeting Scheduled to be held in December, 1999
Any proposal by a shareholder to be presented at the Company's
Annual Meeting of Shareholders scheduled to be held in December,
1999 must be received at the offices of the Company, Suite 104,
5387 Manhattan Circle, Boulder, Colorado 80303, no later than July
31, 1999.
If any other matters do properly come before the meeting, the
proxy holders intend to vote the proxies held by them in accordance
with their best judgement on such matters.
Financial Statements
The Annual Report on Form 10-K for the fiscal year ended June
30, 1998, including financial statements, accompanies these proxy
materials and is incorporated herein by reference.
PROXY PROXY
THE NEW PARAHO CORPORATION
Annual Meeting of Shareholders
December 4, 1998
The undersigned hereby appoints Joseph L. Fox and Anne Morgan
Smith, or either of them, proxies with full power of substitution
to vote for the undersigned all shares of the Common Stock of The
New Paraho Corporation (the "Company") that the undersigned would
be entitled to vote if personally present at the Annual Meeting of
Shareholders to be held on Friday, December 4, 1998, at the Holiday
Inn, 800 28th Street, Boulder, Colorado at 11:00 a.m., Denver,
Colorado time and at any adjournment thereof:
(1) Election of
Theo Ertl William J. Murray, Jr. Adam A. Reeves
Joseph L. Fox Larry A. Lukens Jann Ertl
Jill Ertl Twig Ertl Buff Ertl Palm
Peter Richard
to hold office until the next Annual Meeting of Shareholders or
until their successors shall be elected and shall qualify. If any
nominee becomes unavailable, the Board of Directors may designate
a substitute nominee and such shares will be voted for such
nominee.
___ FOR ___ REFRAIN FROM VOTING ON
INSTRUCTION: TO VOTE AGAINST ANY OF THE NOMINEES, DRAW A LINE
THROUGH THE APPLICABLE NAME OR NAMES ABOVE.
(2) Ratification of appointment of Hein + Associates as
independent auditors of the Company.
___FOR ___AGAINST
(3) In their discretion, the proxies are authorized to vote on
such other business that lawfully may come before the meeting.
This proxy when properly executed, will be voted in the manner
directed herein by the undersigned shareholder.
IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR PROPOSAL (1)
AND PROPOSAL (2).
The undersigned acknowledges receipt with this proxy of a copy of
the Notice of Annual Meeting and Proxy Statement.
Date:________________________________
_____________________________________
Signature of Shareholder
_____________________________________
Signature if Held Jointly
IMPORTANT: Please date this Proxy
and sign exactly as your name or
names appear on your stock
certificate. If shares are held
jointly, signatures should include
both names. Executors,
administrators, trustees, guardians
and others signing in a
representative capacity, please give
full title. If a corporation,
please sign in full corporate name
by officer. If a partnership,
please sign partnership name by
authorized person.
THIS PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE
COMPANY.
Please put a check in the box if you intend to attend the Annual
Meeting. ____