1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended November 30, 1997
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 No. 0-11488
PENFORD CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Washington 91-1221360
- --------------------------------------------------------------------------------
(State of Incorporation) (I.R.S. Employer
Identification No.)
777-108th Avenue N.E., Suite 2390, Bellevue, WA 98004-5193
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (425) 462-6000
Indicate by a 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 the number of shares outstanding of each of the issuer's classes of
common stock, as of January 8, 1998:
Class Outstanding
----- -----------
Common stock, par value $1.00 7,299,261
2
PENFORD CORPORATION AND SUBSIDIARIES
INDEX
Page No.
--------
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
Condensed Consolidated Balance Sheets 3
November 30, 1997 and August 31, 1997
Condensed Consolidated Statements of Income 4
Three Months Ended November 30, 1997
and November 30, 1996
Condensed Consolidated Statements of Cash Flow 5
Three Months Ended November 30, 1997 and
November 30, 1996
Notes to Condensed Consolidated Financial Statements 6-8
Item 2 - Management's Discussion and Analysis of 9-12
Financial Condition and Results of Operations
Item 3 - Quantitative and Qualitative Disclosures About
Market Risk
PART II - OTHER INFORMATION 13
Item 1 - Legal Proceedings
Item 2 - Changes in Securities
Item 3 - Defaults Upon Senior Securities
Item 4 - Submission of Matters to a Vote of Security Holders
Item 5 - Other Information
Item 6 - Exhibits and Reports on Form 8-K
SIGNATURES 14
INDEX TO EXHIBITS 15-16
2
3
PART I - FINANCIAL INFORMATION
Item 1 Financial Statements
PENFORD CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
November 30, August 31,
1997 1997
--------- ---------
ASSETS
Current assets:
Cash and cash equivalents $ 724 $ 176
Trade accounts receivable 25,777 27,181
Inventories:
Raw materials, supplies and other 6,819 6,624
Work in progress 807 886
Finished goods 14,520 14,325
--------- ---------
22,146 21,835
Prepaid expenses and other 6,303 5,179
--------- ---------
Total current assets 54,950 54,371
Net property, plant and equipment 131,076 130,374
Deferred income taxes 11,001 11,007
Restricted cash value of life insurance 12,586 12,691
Other assets 7,374 7,486
--------- ---------
Total assets $ 216,987 $ 215,929
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 8,468 $ 10,089
Accrued liabilities 8,827 8,157
Current portion of long-term debt 3,697 5,955
--------- ---------
Total current liabilities 20,992 24,201
Long-term debt 64,589 61,791
Other postretirement benefits 10,569 10,294
Deferred income taxes 22,040 22,136
Other liabilities 8,660 8,406
Shareholders' equity:
Common stock 9,096 9,093
Additional paid-in capital 18,654 18,466
Retained earnings 93,987 93,854
Treasury stock (30,496) (30,604)
Note receivable from Savings and
Stock Ownership Plan (568) (639)
Cumulative translation adjustment (536) (1,069)
--------- ---------
Total shareholders' equity 90,137 89,101
--------- ---------
Total liabilities and shareholders' equity $ 216,987 $ 215,929
========= =========
See accompanying notes to condensed consolidated financial statements.
3
4
PENFORD CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in thousands except per share data)
Three Months
Ended November 30
--------------------------
1997 1996
----------- -----------
Sales $ 48,523 $ 49,310
Cost of sales 35,634 38,500
----------- -----------
Gross margin 12,889 10,810
Operating expenses 10,715 8,590
----------- -----------
Income from operations 2,174 2,220
Other income 1,200
Interest expense, net (1,409) (1,298)
----------- -----------
Income before income taxes 765 2,122
Income taxes 268 715
----------- -----------
Net income $ 497 $ 1,407
=========== ===========
Weighted average common shares and
equivalents outstanding 7,530,490 6,993,058
Earnings per common share $ 0.07 $ 0.20
=========== ===========
Dividends declared per common share $ 0.05 $ 0.05
=========== ===========
See accompanying notes to condensed consolidated financial statements.
4
5
PENFORD CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
(Dollars in Thousands)
Three Months
Ended November 30
--------------------
1997 1996
-------- --------
Operating Activities:
Net income $ 497 $ 1,407
Adjustments to reconcile net income to net cash
from operating activities:
Depreciation and amortization 3,241 2,926
Deferred income taxes (90)
Other 36
Change in operating assets and liabilities:
Trade receivables 1,404 3,260
Inventories (311) 1,275
Accounts payable and other (1,796) 1,181
-------- --------
Net cash from operating activities 2,981 10,049
Investing Activities:
Additions to property, plant and equipment (3,884) (8,540)
Other 1,220 (360)
-------- --------
Net cash used by investing activities (2,664) (8,900)
Financing Activities:
Proceeds from unsecured line of credit 22,573 19,035
Payments on unsecured line of credit (24,565) (22,094)
Proceeds from long-term debt 5,000 5,000
Payments on long-term debt (2,468) (318)
Exercise of stock options 55 125
Payment of dividends (364) (342)
-------- --------
Net cash from financing activities 231 1,406
-------- --------
Net increase in cash and cash equivalents 548 2,555
Cash (bank overdrafts) and cash equivalents at
beginning of period 176 (847)
-------- --------
Cash and cash equivalents at end of period $ 724 $ 1,708
======== ========
See accompanying notes to condensed consolidated financial statements.
5
6
PENFORD CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements
have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions
to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not
include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. In
the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation for
the interim period presented have been included. Operating results for
the three month period ended November 30, 1997 are not necessarily
indicative of the results that may be expected for the year ending
August 31, 1998. For further information, refer to the consolidated
financial statements and footnotes thereto included in Penford
Corporation's ("Penford" or the "Company," formerly PENWEST, LTD.)
annual report on Form 10-K for the fiscal year ended August 31, 1997.
Certain prior year amounts have been reclassified to conform with
current year presentation. These reclassifications had no effect on
previously reported results of operations.
2. INCOME TAXES
The effective tax rate for the quarter ended November 30, 1997 is 35%.
The effective rate is higher than the federal statutory rate of 34% due
to the effects of state income taxes.
3. EARNINGS PER COMMON SHARE
Earnings per common share were computed by dividing net income by the
weighted average number of common shares and dilutive common share
equivalents outstanding during the fiscal quarter. Outstanding stock
options are considered to be common share equivalents.
In February 1997, the Financial Accounting Standards Board (FASB)
issued Statement No. 128, Earnings Per Share, which is required to be
adopted in the second quarter of fiscal 1998. At that time, the Company
will be required to change the method currently used to compute
earnings per share and to restate all prior periods. Under the new
requirements for calculating primary earnings per share, the dilutive
effect of stock options will be excluded. When adopted, the standard
will have no effect on primary earnings per share for the fiscal
quarter ending November 30, 1997 and will cause a $0.01 per share
6
7
increase to primary earnings per share for the quarter ending November
30, 1996. The impact of Statement No. 128 on the calculation of fully
diluted earnings per share is not expected to be material.
4. OTHER INCOME
During the quarter ended November 30, 1996, the Company sold certain
Southern California air emission credits and recognized a gain of $1.2
million that is shown as other income.
5. PLANNED INITIAL PUBLIC OFFERING AND SPIN-OFF OF PENWEST PHARMACEUTICALS
CO.
During the first quarter of fiscal 1998, the Company changed its name
to Penford Corporation in connection with a two-stage plan designed to
foster the growth potential of its pharmaceuticals business, and
separately, its specialty starch based paper chemicals and food
ingredients businesses. Under the first stage of the plan, the
Company's Penwest Pharmaceuticals Co. (Penwest) subsidiary would sell
up to 20% of its common stock through an initial public offering. Under
the second stage of the plan, Penford Corporation would effect a
tax-free spin-off to its shareholders of the remaining ownership of
Penwest shares contingent upon satisfying certain conditions. The
spin-off was anticipated to occur in the second calendar quarter of
1998.
On October 21, 1997, Penwest filed a registration statement with the
Securities and Exchange Commission for an initial public offering of
2,500,000 shares of common stock (approximately 15% of its outstanding
common stock). The estimated initial public offering price is between
$10.00 to $12.00 per share. An option will be granted to the
underwriters to purchase up to 375,000 additional shares for the
purpose of covering over-allotments, if any.
On December 18, 1997, Penford Corporation postponed the initial public
offering of Penwest due to market conditions for new issues in general
as well as for health care and technology stocks in particular. The
Company intends to go forward with the offering as soon as practicable
after market conditions improve. This postponement may cause the
planned spin-off to be delayed beyond the second calendar quarter of
1998. Costs incurred by Penford Corporation related to the execution of
the plan are being deferred and will be charged to expense in the
quarter in which the outcome of the plan is reasonably determinable. As
of November 30, 1997, such costs approximated $1.6 million. In
addition, Penwest is incurring certain costs that will be recorded as a
reduction of Penwest's shareholders' equity upon completion of the
initial public offering. Changes to the plan could result in some or
all of such costs being charged to expense.
7
8
Penwest will retain the proceeds from the planned initial public
offering. Penford will forgive intercompany advances as of the closing
of the offering. As of November 30, 1997, the intercompany balance
approximated $38.1 million. Had the proposed plan been effected as of
November 30, 1997, consolidated assets and shareholders' equity of
Penford would have reflected a reduction of approximately $35.0 to
$40.0 million, representing the net effects of the proposed
distribution.
Summarized quarterly financial data of Penwest as of November 30, and
for the three months then ended is as follows (in 000's):
1997 1996
---- ----
Sales $ 6,742 $ 6,243
Loss from operations (2,445) (950)
Identifiable assets 39,549 36,633
8
9
Item 2 MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RECENT DEVELOPMENTS
During the first quarter of fiscal 1998, the Company changed its name to Penford
Corporation in connection with a two-stage plan designed to foster the growth
potential of its pharmaceuticals business, and separately, its specialty starch
based paper chemicals and food ingredients businesses. Under the first stage of
the plan, the Company's Penwest Pharmaceuticals Co. (Penwest) subsidiary would
sell up to 20% of its common stock through an initial public offering. Under the
second stage of the plan, Penford Corporation would effect a tax-free spin-off
to its shareholders of the remaining ownership of Penwest shares contingent upon
satisfying certain conditions. The spin-off was anticipated to occur in the
second calendar quarter of 1998.
On October 21, 1997, Penwest filed a registration statement with the Securities
and Exchange Commission for an initial public offering of 2,500,000 shares of
common stock (approximately 15% of its outstanding common stock). The estimated
initial public offering price is between $10.00 to $12.00 per share. An option
will be granted to the underwriters to purchase up to 375,000 additional shares
for the purpose of covering over-allotments, if any.
On December 18, 1997, Penford Corporation postponed the initial public offering
of Penwest due to market conditions for new issues in general as well as for
health care and technology stocks in particular. The Company intends to go
forward with the offering as soon as practicable after market conditions
improve. This postponement may cause the planned spin-off to be delayed beyond
the second calendar quarter of 1998. Costs incurred by Penford Corporation
related to the execution of the plan are being deferred and will be charged to
expense in the quarter in which the outcome of the plan is reasonably
determinable. As of November 30, 1997, such costs approximated $1.6 million. In
addition, Penwest is incurring certain costs that will be recorded as a
reduction of Penwest's shareholders' equity upon completion of the initial
public offering. Changes to the plan could result in some of all of such costs
being charged to expense.
RESULTS OF OPERATIONS
Net income was $497,000, or $0.07 per share, for the quarter ended November 30,
1997, compared to net income of $1.4 million, or $0.20 per share, for the
corresponding period a year ago. The prior year's first quarter included a
one-time, pre-tax gain of $1.2 million from the sale of remaining Southern
California air emission credits related to Great Western Malting Co. (sold in
1989).
The Company, excluding Penwest, earned income from operations of $3.2 million in
the first quarter compared with $1.9 million on the same basis in the prior
year. Penwest Pharmaceuticals Co. incurred an operating loss in the first fiscal
quarter of $2.4 million compared to an operating loss of $950,000 in the same
quarter a year ago. Penwest's increased loss is attributed to increased
investment in the research and development of novel drug delivery technologies
and expenses associated with establishing Penwest as an independent public
company.
9
10
Consolidated sales decreased 1.6% in the three months ended November 30, 1997 to
$48.5 million from $49.3 million in the corresponding period a year ago. The
decrease is primarily due to unusually high corn costs in the first quarter of
fiscal 1997, a key component used in pricing Penford's paper chemical products.
Penford Products Co. sales volumes increased approximately 11% from the same
period in the prior year reflecting core business growth and the effects of
sales and marketing initiatives. Penford Food Ingredients Co. starch sales
volume improved approximately 18% primarily due to increased sales of starches
for french fry coatings.
Gross margin for the first quater of fiscal year 1998 was 26.6% compared to
21.9% for the corresponding period a year ago. The increase is primarily due to
the effects of record high corn costs in the prior year of which only a portion
could be passed on to customers through higher prices, and in the current year,
the results of cost containment initiatives and the impact of manufacturing
improvements.
Operating expenses increased $2.1 million to $10.7 million in the three months
ended November 30, 1997, compared to $8.6 million in the corresponding period a
year ago. General and administrative costs rose $1.8 million due to expenses
associated with building the infrastructure to support anticipated growth for
the pharmaceuticals operation and increased sales and marketing efforts
principally at Penford Products Co. Research and development costs increased by
$316,000, primarily related to the continued development of pharmaceuticals
using Penwest's controlled release technology.
Net interest expense for the quarter ended November 30, 1997 was $1.4 million
compared to $1.3 million for the corresponding period a year ago due to higher
average debt levels.
The effective tax rate for the first quarter of fiscal 1998 was 35.0% compared
to 33.7% in the corresponding period a year ago. The effective tax rate is
higher than the prior year primarily due to the absence of certain tax refunds
received by the Company in the previous year.
LIQUIDITY
At November 30, 1997, Penford Corporation had cash and cash equivalents of
$724,000, working capital of $34.0 million, an unsecured credit agreement of $35
million under which there was $25.3 million outstanding, and several uncommitted
lines of credit aggregating $15.0 million under which there was $4.0 million
outstanding. The Company used operating cash flow and debt to finance capital
expenditures during the quarter.
Cash flow from operations for the three months ended November 30, 1997 was $3.0
million compared to $10.0 million in the corresponding period of the prior year.
The change in cash flow is due to the effects of unusually high corn costs on
the components of working capital in the prior year and lower net income in the
current year.
The Company paid a $0.05 per share dividend on December 5, 1997.
10
11
CAPITAL RESOURCES
Additions to property, plant and equipment during the three months ended
November 30, 1997 were $3.9 million. The additions were primarily for
improvements to the Penford Products Co. manufacturing facility in Cedar Rapids,
Iowa and a capacity expansion project for the Penford Food Ingredients Co.
facility in Richland, Washington.
Penwest intends to begin construction of laboratory and manufacturing facilities
in Patterson, New York in the second quarter of fiscal 1998 at an estimated
total cost of approximately $15 million. Before completion of Penwest's initial
public offering, the Company intends to fund costs incurred on the project from
its cash resources and available credit lines. It is presently anticipated that
amounts paid by the Company would be reimbursed from the proceeds of the initial
public offering. Capital expenditures for the Company's specialty paper
chemicals and food ingredients businesses for the remainder of fiscal 1998 are
expected to be consistent with the first quarter. The timing of Penwest's
initial public offering could affect the amount and timing of capital
expenditures.
FORWARD-LOOKING STATEMENTS
The above discussion contains forward-looking statements concerning the proposed
public offering and spin-off of Penwest, estimated capital expenditures, and the
anticipated activities and results of the Company and Penwest. There are a
variety of factors which could cause actual events to differ materially from
those projected in the forward-looking statements, including without limitation,
the risks that the public offering or the spin-off may not be completed as the
result of future developments in the Company's or Penwest's business or
conditions in the securities markets, failure to obtain necessary government
rulings or approvals or third party consents or agreements; construction delays,
cost overruns, nonperformance by contractors, or changes in capital improvement
project requirements or specifications; competition; the possibility of
interruption of business activities due to accidents, strikes, weather or other
factors; product development risk; patents and intellectual property matters
(including patent infringement litigation, including the patent infringement
suit brought by Bayer AG and Pfizer Inc. against Mylan Laboratories Inc. as
described in the Company's Form 10-K for the fiscal year ended August 31, 1997
on file with the Securities and Exchange Commission); dependence on
collaborators; regulatory and manufacturing issues including the difficulties of
obtaining FDA or other regulatory approvals; changes in raw material prices;
changes in general economic conditions or developments with respect to specific
industries or customers affecting demand for the Company's products; or other
unforeseen developments in the industries in which the Company operates.
Accordingly, there can be no assurance that the public offering or spin-off will
be completed, or that future activities or results as described will be as
anticipated.
11
12
The registration statement filed by Penwest with the Securities and Exchange
Commission has not yet become effective. The securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. The discussion included herein shall not constitute an offer to sell
or a solicitation of an offer to buy nor shall there be any sale of these
securities in any state or jurisdiction, in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under the
securities laws of any such state or jurisdiction.
Additional information which could affect the Company's financial results is
included in the Company's 1997 Annual Report to Shareholders and its Form 10-K
for the fiscal year ended August 31, 1997 on file with the Securities and
Exchange Commission. Penford assumes no obligation to update any forward-looking
statements should circumstances change.
12
13
Item 3 Quantitative and Qualitative Disclosures About Market Risk
Not applicable
PART II - OTHER INFORMATION
Item 1 Legal Proceedings
The registrant is unaware of any material developments in the legal
proceedings referred to in the Registrant's Report on Form 10-K for the
year ended August 31, 1997.
In November, 1997, the Company was notified that a nearby resident
had complained about health problems allegedly caused by starch
emissions from the Company's Idaho Falls facility. Subsequently, the
Idaho Department of Environmental Quality contacted the Company with
regard to possible exceedences of the Company's air quality permit
limits. In December, 1997, a group of nearby residents filed a Notice
of Intent to Bring Suit with the Idaho Department of Environmental
Quality and the U.S. Environmental Protection Agency pursuant to the
Clean Air Act, the Comprehensive Environmental Response, Compensation
and Liability Act, and the Emergency Planning and Community
Right-to-Know Act. The Company is investigating these issues; however,
the Company is unable at this time to determine whether any claim or
action will be commenced or to estimate the Company's potential
exposure, if any.
Item 2 Changes in Securities
Not applicable
Item 3 Defaults Upon Senior Securities
Not applicable
Item 4 Submission of Matters to a Vote of Security Holders
Not applicable
Item 5 Other Information
Not applicable
Item 6 Exhibits and Reports on Form 8-K
(a) Exhibits:
10.12 Second Amendment to Credit Agreement dated as of
November 28, 1997 among Penford Corporation and its
subsidiaries, Bank of America National Trust and Savings
Association, ABN-AMRO Bank, N.V., The Bank of Nova Scotia, and
Seattle-First National Bank
11 Statement re: Computation of Earnings Per Share
27 Financial Data Schedule
(b) There were no filings on Form 8-K in the quarter ended
November 30, 1997. A Form 8-K was filed on December 18, 1997
reporting under Item 5 Registrant's postponement of the
initial public offering of Penwest Pharmaceuticals Co., a
wholly owned subsidiary. Also filed as an exhibit was a copy
of a press release dated December 18, 1997 relating to such
postponement.
13
14
SIGNATURES
Pursuant to the requirements 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.
PENFORD CORPORATION
-------------------
(Registrant)
January 12, 1998 /s/ Tod R. Hamachek
- ---------------- -------------------------------------
Date Tod R. Hamachek
President and
Chief Executive Officer (Principal
Executive Officer)
January 12, 1998 /s/ Jeffrey T. Cook
- ---------------- -------------------------------------
Date Jeffrey T. Cook
Vice President, Finance and
Chief Financial Officer (Principal
Financial Officer)
14
15
INDEX TO EXHIBITS
Exhibits identified in parentheses below, on file with the Securities and
Exchange Commission, are incorporated by reference.
Exhibit No. Item
- ----------- ----
(3.1) Restated Articles of Incorporation of Registrant (filed as an
Exhibit to Registrant's Form 10-K for fiscal year ended August
31, 1995)
(3.2) Articles of Amendment to Restated Articles of Incorporation of
Registrant (filed as an exhibit to Registrant's Form 10-K for
fiscal year ended August 31, 1997)
(3.3) Bylaws of Registrant as amended and restated as of October 20,
1997 (filed as an exhibit to Registrant's Form 10-K for fiscal
year ended August 31, 1997)
(4.1) Amended and Restated Rights Agreement dated as of April 30,
1997 (filed as an Exhibit to Registrant's Amendment to
Registration Statement on Form 8-A/A dated May 5, 1997)
(10.1) Senior Note Agreement among Penford Corporation as Borrower and
Mutual of Omaha and Affiliates as lenders, dated November 1,
1992 (filed as an Exhibit to Registrant's Form 10-Q for the
quarter ended February 28, 1993)
(10.2) Loan Agreement among Penford Corporation as Borrower and
Seattle-First National Bank as Lender, dated December 1, 1989
(Registrant agrees to furnish a copy of this instrument to the
Commission on request)
(10.3) Penford Corporation Supplemental Executive Retirement Plan,
dated March 19, 1990 (filed as an Exhibit to Registrant's Form
10-K for the fiscal year ended August 31, 1991)
(10.4) Penford Corporation Supplemental Survivor Benefit Plan, dated
January 15, 1991 (filed as an Exhibit to Registrant's Form 10-K
for the fiscal year ended August 31, 1991)
(10.5) Penford Corporation Deferred Compensation Plan, dated January
15, 1991 (filed as an Exhibit to Registrant's Form 10-K for the
fiscal year ended August 31, 1991)
15
16
(10.6) Change of Control Agreements with Messrs. Hamachek, Cook,
Widmaier, Talley, Horn, Rydzewski and Belsheim (a
representative copy of these agreements is filed as an exhibit
to Registrant's Form 10-K for the fiscal year ended August 31,
1995)
(10.7) Penford Corporation 1993 Non-Employee Director Restricted Stock
Plan (filed as an Exhibit to Registrant's Form 10-Q for the
quarter ended November 30, 1993)
(10.8) Note Agreement dated as of October 1, 1994 among Penford
Corporation, Principal Mutual Life Insurance Company and TMG
Life Insurance Company (filed as an Exhibit to Registrant's
Form 10-Q for the quarter ended February 28, 1995)
(10.9) Penford Corporation 1994 Stock Option Plan as amended and
restated as of January 21, 1997 (filed on Form S-8 dated March
17, 1997)
(10.10) Credit Agreement dated as of December 22, 1995 among Penford
Corporation, and its subsidiaries, Bank of America National
Trust and Savings Association, ABN-AMRO Bank, N.V., The Bank of
Nova Scotia, and Seattle-First National Bank (filed as an
exhibit to Registrant's Form 10-Q for the quarter ended
February 29, 1996)
(10.11) Amendment to Credit Agreement dated as of May 7, 1997 among
Penford Corporation and its subsidiaries, Bank of America
National Trust and Savings Association, ABN-AMRO Bank, N.V.,
the Bank of Nova Scotia, and Seattle-First National Bank (filed
as an exhibit to the Registrant's Form 10-Q for the quarter
ended May 31, 1997)
10.12 Second Amendment to Credit Agreement dated as of November 28,
1997 among Penford Corporation and its subsidiaries, Bank of
America National Trust and Savings Association, ABN-AMRO Bank,
N.V., The Bank of Nova Scotia, and Seattle-First National Bank
(10.13) Penford Corporation Stock Option Plan for Non-Employee
Directors (filed as an exhibit to the Registrant's Form 10-Q
for the quarter ended May 31, 1996)
(10.14) Separation Agreement dated as of November 10, 1997 between
Registrant and Penwest Pharmaceuticals Co. (filed as an exhibit
to Registrant's Form 10-K for fiscal year ended August 31,
1997)
11 Statement Regarding Computation of Per-Share Earnings
27 Financial Data Schedule
16