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the condition that petitioner raise cash through sales of
common or preferred stock, certificates of indebtedness, or
assets. The Wichita Bank also required petitioner to grant
the Wichita Bank the right to examine petitioner’s books
and have a bank representative attend meetings of
petitioner’s board of directors.
Petitioner’s financial difficulties continued into
1954. Petitioner took steps to cut costs and dispose of
assets and was ultimately able to complete the nitrogen
plant. By 1957, the nitrogen plant was operating
profitably, and the financial crisis had dissipated.
In 1957, petitioner formed a subsidiary called
Farmbest, Inc., for the purpose of marketing food products
of its members. Farmbest’s initial business consisted of
slaughtering hogs and cattle and processing the meat into
finished products. In 1970, petitioner transferred its
food marketing business to another subsidiary called
Farmland Foods, Inc. In 1976, petitioner acquired a grain
marketing cooperative called Far-Mar-Co, Inc.
By the end of 1957, petitioner was one of the six
largest industrial corporations in the United States.
Petitioner’s sales increased rapidly during the period from
1973 to 1980. Petitioner’s expansion paralleled and
reflected the overall expansion of the agricultural sector
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