-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, U131lLEoXUFxpv4LL77spX7w1kR3BoQB4ibPtJmLtR/SzpGtQMaEHZiuAfV9nXnX fRWFgneiPnzywB9L6FRiEQ== 0000023217-95-000028.txt : 19951011 0000023217-95-000028.hdr.sgml : 19951011 ACCESSION NUMBER: 0000023217-95-000028 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19950827 FILED AS OF DATE: 19951010 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONAGRA INC /DE/ CENTRAL INDEX KEY: 0000023217 STANDARD INDUSTRIAL CLASSIFICATION: MEAT PACKING PLANTS [2011] IRS NUMBER: 470248710 STATE OF INCORPORATION: DE FISCAL YEAR END: 0525 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 002-21378 FILM NUMBER: 95579559 BUSINESS ADDRESS: STREET 1: ONE CONAGRA DR CITY: OMAHA STATE: NE ZIP: 68102 BUSINESS PHONE: 4025954000 FORMER COMPANY: FORMER CONFORMED NAME: NEBRASKA CONSOLIDATED MILLS CO DATE OF NAME CHANGE: 19721201 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended August 27, 1995 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 1-7275 ___________________________________________ CONAGRA, INC. __________________________________________________________________ (Exact name of registrant, as specified in charter) Delaware 47-0248710 __________________________________________________________________ (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) One ConAgra Drive, Omaha, Nebraska 68102-5001 __________________________________________________________________ (Address of Principal Executive Offices) (Zip Code) (402) 595-4000 __________________________________________________________________ (Registrant's telephone number, including area code) NA __________________________________________________________________ (Former name, former address and former fiscal year, if changed since last report.) 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 _______ _______ Number of shares outstanding of issuer's common stock, as of September 24, 1995 was 238,471,961 PART I - FINANCIAL INFORMATION CONAGRA, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in Millions) AUG 27, MAY 28, AUG 28, 1995 1995 1994 _________ _________ _________ ASSETS Current assets: Cash and cash equivalents $ 92.2 $ 60.0 $ 42.1 Receivables, less allowance for doubtful accounts of $61.3, $63.9 and $67.0 2,472.3 1,540.0 2,407.1 Margin deposits and segregated funds - - 344.8 Inventory: Hedged commodities 1,037.9 925.4 716.5 Other 2,471.8 2,241.9 2,465.2 _________ _________ _________ Total inventory 3,509.7 3,167.3 3,181.7 Prepaid expenses 401.5 372.9 239.3 _________ _________ _________ Total current assets 6,475.7 5,140.2 6,215.0 _________ _________ _________ Property, plant and equipment at cost, less accumulated depreciation of $1800.5, $1741.8 and $1629.7 2,865.7 2,796.0 2,695.7 Brands, trademarks and goodwill, at cost less accumulated amortization 2,519.1 2,420.1 2,626.2 Other assets 429.7 444.7 398.9 _________ _________ _________ $12,290.2 $10,801.0 $ 11,935.8 _________ _________ _________ _________ _________ _________ The accompanying notes are an integral part of the consolidated financial statements. CONAGRA, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in Millions) AUG 27, MAY 28, AUG 28, 1995 1995 1994 _________ _________ _________ LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Notes payable $ 3,062.5 $ - $ 2,860.3 Current installments of long-term debt 108.1 47.9 124.1 Accounts payable 1,004.1 1,574.8 1,031.4 Advances on sales 190.2 856.6 110.8 Payable to customers, clearing associations, etc. - - 346.0 Other accrued liabilities 1,463.1 1,485.6 1,303.7 _________ _________ _________ Total current liabilities 5,828.0 3,964.9 5,776.3 _________ _________ _________ Senior long-term debt, excluding current installments 1,664.2 1,770.0 1,423.9 Other noncurrent liabilities 920.4 940.8 1,065.1 Subordinated debt 750.0 750.0 766.0 Preferred securities of subsidiary company 525.0 525.0 275.0 Preferred shares subject to mandatory redemption 269.5 354.9 355.6 Common stockholders' equity: Common stock of $5 par value, authorized 1,200,000,000 shares, issued 252,922,486, 252,869,958 and 252,791,925 1,264.6 1,264.3 1,264.0 Additional paid-in capital 513.7 409.9 426.7 Retained earnings 1,748.1 1,712.5 1,452.8 Foreign currency translation adjustment (45.2) (44.9) (30.6) Less treasury stock, at cost, common shares 12,353,384, 7,172,312 and 4,696,512 (414.8) (206.9) (121.3) _________ _________ _________ 3,066.4 3,134.9 2,991.6 Less unearned restricted stock and value of 18,239,477, 19,423,916 and 21,544,551 common shares held in EEF (733.3) (639.5) (717.7) _________ _________ _________ Total common stockholders' equity 2,333.1 2,495.4 2,273.9 _________ _________ _________ $12,290.2 $10,801.0 $ 11,935.8 _________ _________ _________ _________ _________ _________ The accompanying notes are an integral part of the consolidated financial statements. CONAGRA, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS (Dollars and shares in millions except per share amounts) THIRTEEN WEEKS ENDED AUG 27, AUG 28, 1995 1994 _________ _________ Net sales $ 6,436.4 $ 6,245.9 _________ _________ Costs and expenses: Cost of goods sold 5,634.4 5,506.8 Selling, administrative and general expenses 578.3 545.1 Interest expense, net 75.9 68.7 _________ _________ 6,288.6 6,120.6 _________ _________ Income before equity in earnings of affiliates and income taxes 147.8 125.3 Equity in earnings(loss) of affiliates (0.2) 2.7 _________ _________ Income before income taxes 147.6 128.0 Income taxes 60.5 51.2 _________ _________ Net income 87.1 76.8 Less preferred dividends 5.1 6.0 _________ _________ Net income available for common stock $ 82.0 $ 70.8 _________ _________ _________ _________ Earnings per common and common equivalent share $ 0.36 $ 0.31 _________ _________ _________ _________ Weighted average number of common and common equivalent shares outstanding 227.5 228.6 _________ _________ _________ _________ Cash dividends declared per common share $ 0.208 $ 0.180 _________ _________ _________ _________ The accompanying notes are an integral part of the consolidated financial statements. CONAGRA, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in Millions) THIRTEEN WEEKS ENDED AUG 27, AUG 28, Increase (decrease in Cash and Cash Equivalents) 1995 1994 _________ _________ Cash flows from operating activities: Net income $ 87.1 $ 76.8 Adjustments to reconcile net income to net cash used in operating activities: Depreciation and other amortization 87.2 77.9 Goodwill amortization 17.7 17.1 Other noncash items (includes nonpension postretirement benefits) 16.7 17.4 Change in assets and liabilities before effects from business acquisitions (2,600.0) (2,651.6) _________ _________ Net cash flows from operating activities (2,391.3) (2,462.4) _________ _________ Cash flows from investing activities: Sale of property, plant and equipment 8.6 1.9 Additions to property, plant and equipment (120.9) (76.6) Payment for business acquisitions (162.7) (163.0) Decrease in notes receivable-Monfort Finance Company 39.8 64.8 Other items 0.4 (31.9) _________ _________ Net cash flows from investing activities (234.8) (204.8) _________ _________ Cash flows from financing activities: Net short term borrowings 3,062.5 2,441.3 Proceeds from exercise of employee stock options 17.4 5.4 Cash dividends paid (53.1) (46.6) Repayment of long-term debt (46.5) (14.0) Treasury stock purchases (311.6) - Issuance of preferred securities of a subsidiary company - 175.0 Employee Equity Fund stock transactions 1.9 1.0 Other items (12.3) (19.2) _________ _________ Net cash flows from financing activities 2,658.3 2,542.9 _________ _________ Net increase (decrease) in cash & cash equivalents 32.2 (124.3) Cash and cash equivalents at beginning of year 60.0 166.4 _________ _________ Cash and cash equivalents at end of period $ 92.2 $ 42.1 _________ _________ _________ _________ The accompanying notes are an integral part of the consolidated financial statements. CONAGRA, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS AUGUST 27, 1995 (1) The information furnished herein relating to interim periods has not been examined by independent Certified Public Accountants. In the opinion of management, all adjustments necessary for a fair statement of the results for the periods covered have been included. All such adjustments are of a normal recurring nature. The accounting policies followed by the Company, and additional footnotes, are set forth in the financial statements included in the Company's 1995 annual report, which report was incorporated by reference in Form 10-K for the fiscal year ended May 28, 1995. (2) The composition of inventories is as follows (in millions): AUG 27, MAY 28, AUG 28, 1995 1995 1994 ________ ________ ________ Hedged commodities $1,037.9 $ 925.4 $ 716.5 Food products and livestock 1,253.8 1,232.2 1,386.0 Agricultural chemicals, fertilizer and feed 583.8 323.1 499.8 Retail merchandise 180.2 196.4 176.0 Other, principally ingredients and supplies 454.0 490.2 403.4 ________ ________ ________ $3,509.7 $3,167.3 $3,181.7 ________ ________ ________ ________ ________ ________ (3) Following is a condensed statement of common stockholders' equity (in millions): Unearned Add'l Foreign Restricted Common Paid-In Retained Curr Treasury & EEF Stock Capital Earnings Trns Adj Stock Stock Total __________ __________ __________ __________ __________ __________ __________ Balance 5/28/95 $ $1,264.3 $ $409.9 $ $1,712.5 $ ($44.9)$ ($206.9)$ ($639.5) $ $2,495.4 Shares issued Employee stock options 0.2 0.3 0.1 (0.1) 0.5 EEF* stock option, incentive and other employee benefit plans (2.0) 32.3 30.3 Fair market valuation of EEF shares 126.2 (126.2) - Acquisitions 0.1 0.4 0.5 Conversion of preferred stock (21.1) 106.5 85.4 Shares acquired Incentive plans (2.9) 0.2 (2.7) Treasury shares purchased (311.6) (311.6) Foreign currency translation adjustment (0.3) (0.3) Cash dividends declared (51.5) (51.5) Net income 87.1 87.1 __________ __________ __________ __________ __________ __________ __________ Balance 8/27/95 $ $1,264.6 $ $513.7 $ $1,748.1 $ ($45.2)$ ($414.8)$ ($733.3) $ $2,333.1 __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ __________ *Employee Equity Fund
(4) On August 14, 1990, ConAgra acquired Beatrice Company (Beatrice). As a result of the acquisition and the significant pre-acquisition tax and other contingencies of the Beatrice businesses and its former subsidiaries, the consolidated post-acquisition financial statements of ConAgra have reflected significant liabilities and valuation allowances associated with the estimated resolution of these contingencies. Subsequent to the acquisition of Beatrice by ConAgra, the Internal Revenue Service completed its audit of the federal income tax returns of Beatrice and its predecessors for the fiscal years ended in 1985 through 1987 and issued an examining agent's report. The findings contained in the report were protested by Beatrice. Agreement was reached with the Internal Revenue Service regarding these matters in August 1995. This settlement resolves all deficiencies proposed by the Internal Revenue Service for 1987 and prior years, including deficiencies relating to previously-filed carry-back claims. The settlement allowed ConAgra to better estimate the amounts of Beatrice state tax liabilities that will ultimately be paid to various state tax authorities, and the amounts of state tax and interest that will be deductible for federal income tax purposes. Prior to the settlement, ConAgra had recorded a valuation allowance against deferred tax assets of approximately $230.0 million due to uncertainties as to the ultimate realization of these assets. As a result of the settlement, ConAgra has released the $230.0 million valuation allowance and has reduced noncurrent liabilities by $135.0 million, with a resulting reduction of goodwill associated with the Beatrice acquisition of $365.0 million. Federal income tax returns of Beatrice for fiscal years ended 1988, 1989 and 1990 and various state tax returns remain open. However, after taking into account the foregoing adjustments, management believes that the ultimate resolution of all remaining pre-acquisition Beatrice tax contingencies should not exceed the reserves established for such matters. Beatrice is also engaged in various litigation and environmental proceedings related to businesses divested by Beatrice prior to its acquisition by ConAgra. The environmental proceedings include litigation and administrative proceedings involving Beatrice's status as a potentially responsible party at 42 Superfund, proposed Superfund or state-equivalent sites. Beatrice has paid or is in the process of paying its liability share at 33 of these sites. Beatrice's known volumetric contribution exceeds 4% at seven of the sites. Beatrice has established substantial reserves for these matters. The environmental reserves are based on Beatrice's best estimate of its undiscounted remediation liabilities, which estimates include evaluation of investigatory studies, extent of required cleanup, the known volumetric contribution of Beatrice and other potentially liable responsible parties and Beatrice's prior experience in remediating sites. Management believes the ultimate resolution of such Beatrice legal and environmental contingenices should not exceed the reserves established for such matters. ConAgra is party to a number of other lawsuits and claims arising out of the operation of its businesses. After taking into account liabilities recorded for all of the foregoing matters, management believes the ultimate resolution of such matters should not have a material adverse effect on ConAgra's financial condition, results of operation or liquidity. (5) Earnings per common and common equivalent share are calculated on the basis of the weighted average outstanding common shares and, when applicable, those outstanding options that are dilutive and after giving effect to the preferred stock dividend requirements. Fully diluted earnings per share did not differ significantly from primary earnings per share in any period presented. CONAGRA, INC. AND SUBSIDIARIES MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following is management's discussion and analysis of certain significant factors which have affected the Company's financial condition and operating results for the periods included in the accompanying consolidated condensed financial statements. Results for the fiscal 1996 first quarter are not necessarily indicative of results which may be attained in the future. FINANCIAL CONDITION During the first quarter of fiscal 1996, the Company's capital investment (working capital plus noncurrent assets) decreased $373.9 million. Working capital decreased $527.6 million and noncurrent assets increased $153.7 million. The decrease in working capital resulted from an increase in notes payable due to a business acquisition and normal property, plant and equipment additions, and from treasury stock purchases (see below). The increase in notes payable was was also due to the normal seasonal increase in accounts receivable and inventory. The decrease in payables to customers and margin deposits and segregated funds from the prior year first quarter is the result of the sale of Geldermann, Inc. during the third quarter of fiscal 1995. The increase in other noncurrent assets is primarily due to a business acquisition and normal additions to property, plant and equipment. Versus the same period last year, property, plant and equipment increased $170 million, mainly as the result of acquisitions. This increase was funded by a combination of operating cash flow and an increase in notes payable. The Company's objective is that senior long-term debt normally will not exceed 30 percent of total long-term debt plus equity. At August 27, 1995, senior long-term debt was 30 percent of total long-term debt plus equity compared to 30 percent at May 28, 1995 and 28 percent at August 28, 1994. The Company has indicated it intends to call some or all of its Class E $25.00 cumulative convertible preferred stock during calendar year 1995, subject to market conditions and director approval. As of September 26, 1995 the Company has purchased, in the open market, 14,436,587 shares of common stock at an aggregate cost of $516.8 million since February 1995. Such purchases are intended to cover the anticipated conversion of the Class E preferred stock. On September 30, 1995 the Company commenced a tender offer for all outstanding common stock of Canada Malting Co. Limited, one of the world's largest producers of malted barley. The tender offer is subject to certain conditions and is scheduled to expire October 31, 1995, subject to extension. If the tender offer is successful, the total amount required to purchase the common stock and pay related expenses is approximately U.S. $296.0 million. OPERATING RESULTS A summary of the period to period increases (decreases) in the principal components of operations is shown below (dollars in millions, except per share amounts). COMPARISON OF THE PERIODS ENDED AUG. 27, 1995 & AUG. 28, 1994 THIRTEEN WEEKS DOLLARS % ________________ Net sales 190.5 3.1 Cost of goods sold 127.6 2.3 Gross profit 62.9 8.5 Selling, administrative and general expense 33.2 6.1 Interest expense, net 7.2 10.5 Income before equity in earnings of affiliates and income taxes 22.5 18.0 Equity in earnings of affiliates (2.9) NM* Income before income taxes 19.6 15.3 Income taxes 9.3 18.2 Net income 10.3 13.4 Earnings per common and common equivalent share 0.05 16.1 *Not Measurable All three of ConAgra's industry segments, Food Inputs & Ingredients, Refrigerated Foods and Grocery/Diversified Products achieved operating profit growth in the first quarter of fiscal 1996 over fiscal 1995's first quarter. Sources of increased sales and expenses during the first quarter included the international trading businesses, the grocery products companies and the potato products businesses. In the Refrigerated Foods segment, a major contributor to the growth in operating profit was the fresh meat business as beef margins benefited from abundant raw materials and good demand. Branded packaged meats, turkey products and cheese products also contributed to earnings gains. Chicken products earnings declined, but are expected to improve as the year progresses. In the Grocery/Diversified segment, all three major businesses contributed to first quarter operating profit growth. The growth in earnings in the Lamb-Weston potato products business was due, in part, to an acquisition last year. Healthy Choice products continued to contribute to the earnings growth in consumer frozen foods while Hunt Foods drove Hunt-Wesson's operating profit growth. In the Food Inputs & Ingredients segment, the principal sources of first quarter operating profit growth were grain merchandising, international fertilizer marketing and management actions last year to eliminate unhealthy businesses. Grain processing earnings decreased due to weak flour milling results. Crop input earnings declined as wet weather deferred pesticide and fertilizer sales from the first to second quarter. Specialty retailing earnings were down. Acquisitions, as well as unit volume increases, contributed to ConAgra's first quarter sales growth, partially offset by the divestiture of non-core businesses and the weather-related decline in crop input sales. Operating profit is based on net sales less all identifiable operating expenses and includes the related equity in earnings of companies included on the basis of the equity method of accounting. General corporate expense, interest expense (except financial businesses) income taxes and goodwill amortization are excluded from segment operations. For financial businesses, operating profit includes the effect of interest, which is a large element of their operating costs. ConAgra's first quarter effective tax rate increased from 40 percent in fiscal 1995 to 41 percent in fiscal 1996 principally because of lower equity in earnings of affiliates. Weighted average shares outstanding decreased in fiscal 1996's first quarter over fiscal 1995's first quarter primarily as a result of common stock repurchases. Preferred dividends decreased because of conversion of a portion of Class E preferred stock. ConAgra is in the process of divesting certain non-core businesses. During fiscal 1995, ConAgra divested Consumer Direct (direct mail marketing), Dyno Merchandise, Inc. (home sewing accessories), Geldermann, Inc. (financial services), and Berliner & Marx, Inc. (meat products). In July 1995, ConAgra also completed the sale of Petrosul International (sulfur processing and marketing) and Alum Rock Foodservice (cheese distribution). In October 1995, ConAgra completed the sale of Omaha Vaccine (animal care products). Sales and earnings of the businesses divested and identified for divestiture are not material to ConAgra's results of operations. The company expects that the ultimate gain or loss on the divestiture program will not be significant to ConAgra's results of operations. ConAgra is required to adopt SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of," no later than fiscal 1997. ConAgra has not yet quantified the effect, if any, of implementation on the financial statements. CONAGRA, INC. AND SUBSIDIARIES PART II - OTHER INFORMATION ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS. ConAgra's annual meeting of stockholders was held on September 28, 1995. The stockholders elected four directors to serve three-year terms, approved ConAgra's 1995 Stock Plan, and ratified the appointment of Deloitte & Touche to examine ConAgra's financial statements. Voting on these items was as following: 1. ELECTION OF DIRECTORS. FOR WITHHELD C. M. Harper 200,507,381 7,585,304 Carl E. Reichardt 206,617,544 1,475,141 Marjorie M. Scardino 206,321,727 1,770,985 William G. Stocks 206,286,287 1,806,398 2. RATIFICATION OF ACCOUNTANTS FOR: 206,528,601 AGAINST: 679,105 ABSTAIN: 884,979 BROKER/NON-VOTES: -0- 3. APPROVAL OF CONAGRA'S 1995 STOCK PLAN FOR: 178,255,617 AGAINST: 27,439,082 ABSTAIN: 2,397,986 BROKER/NON-VOTES: -0- ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (A) EXHIBITS. 10.1 - ConAgra 1995 Stock Plan 12 - Statement regarding computation of ratio of earnings to fixed charges, and ratio of earnings to combined fixed charges and preferred dividends. 27 - Financial Data Schedule. (B) REPORTS ON FORM 8-K. ConAgra did not file any reports on Form 8-K for the quarter ended August 27, 1995. CONAGRA, INC. By: /s/ James P. O'Donnell ________________________ James P. O'Donnell Senior Vice President and Chief Financial Officer By: /s/ Kenneth W. DiFonzo _____________________________ Kenneth W. DiFonzo Vice President and Controller Dated this 10 day of October, 1995. EXHIBIT INDEX EXHIBIT DESCRIPTION PAGE 10.1 - ConAgra 1995 Stock Plan....................... 12 - Statement regarding computation of ratio of earnings to fixed charges, and ratio of earnings to combined fixed charges and preferred dividends....................... 27 - Financial Data Schedule....................... EX-10 2 EXHIBIT 10.1 CONAGRA 1995 STOCK PLAN SECTION 1 NAME AND PURPOSE 1.1 Name. The name of the plan shall be the ConAgra 1995 Stock Plan (the "Plan"). 1.2. Purpose of Plan. The purpose of the Plan is to foster and promote the long-term financial success of the Company and increase stockholder value by (a) motivating superior performance by means of stock incentives, (b) encouraging and providing for the acquisition of an ownership interest in the Company by Employees and (c) enabling the Company to attract and retain the services of a management team responsible for the long-term financial success of the Company. SECTION 2 DEFINITIONS 2.1 Definitions. Whenever used herein, the following terms shall have the respective meanings set forth below: (a) "Act" means the Securities Exchange Act of 1934, as amended. (b) "Award" means any Option, Stock Appreciation Right, Restricted Stock, Stock Bonus, or any combination thereof, including Awards combining two or more types of Awards in a single grant. (c) "Board" means the Board of Directors of the Company. (d) "Code" means the Internal Revenue Code of 1986, as amended. (e) "Committee" means the Human Resources Committee of the Board, which shall consist of two or more members, each of whom shall be a "disinterested person" within the meaning of Rule 16b-3 as promulgated under the Act. (f) "Company" means ConAgra, Inc., a Delaware corporation (and any successor thereto) and its Subsidiaries. (g) "Director Award" means an award of Stock and an award of a Nonstatutory Stock Option granted to each Eligible Director pursuant to Section 7.1 without any action by the Board or the Committee. (h) "Eligible Director" means a person who is serving as a member of the Board and who is not an Employee. (i) "Employee" means any employee of the Company or any of its Subsidiaries. (j) "Fair Market Value" means, on any date, the closing price of the Stock as reported on the New York Stock Exchange (or on such other recognized market or quotation system on which the trading prices of the Stock are traded or quoted at the relevant time) on such date. In the event that there are no Stock transactions reported on such exchange (or such other system) on such date, Fair Market Value shall mean the closing price on the immediately preceding date on which Stock transactions were so reported. (k) "Option" means the right to purchase Stock at a stated price for a specified period of time. For purposes of the Plan, an Option may be either (i) an Incentive Stock Option within the meaning of Section 422 of the Code or (ii) a Nonstatutory Stock Option. (l) "Participant" means any Employee designated by the Committee to participate in the Plan. (m) "Plan" means the ConAgra 1995 Stock Plan, as in effect from time to time. (n) "Restricted Stock" shall mean a share of Stock granted to a Participant subject to such restrictions as the Committee may determine. (o) "Stock" means the Common Stock of the Company, par value $5.00 per share. (p) "Stock Appreciation Right" means the right, subject to such terms and conditions as the Committee may determine, to receive an amount in cash or Stock, as determined by the Committee, equal to the excess of (i) the Fair Market Value, as of the date such Stock Appreciation Right is exercised, of the number shares of Stock covered by the Stock Appreciation Right being exercised over (ii) the aggregate exercise price of such Stock Appreciation Right. (q) "Stock Bonus" means the grant of Stock as compensation from the Company, which may be in lieu of cash compensation otherwise receivable by the Participant or in addition to such cash compensation, and includes stock issued for service awards and other Employee recognition programs. (r) "Subsidiary" means any corporation, partnership, joint venture or other entity in which the Company owns, directly or indirectly, 25% or more of the voting power or of the capital interest or profits interest of such entity. 2.2 Gender and Number. Except when otherwise indicated by the context, words in the masculine gender used in the Plan shall include the feminine gender, the singular shall include the plural, and the plural shall include the singular. SECTION 3 ELIGIBILITY AND PARTICIPATION Except as otherwise provided in Section 7.1, the only persons eligible to participate in the Plan shall be those Employees selected by the Committee as Participants. SECTION 4 POWERS OF THE COMMITTEE 4.1 Power to Grant. The Committee shall determine the Participants to whom Awards shall be granted, the type or types of Awards to be granted, and the terms and conditions of any and all such Awards. The Committee may establish different terms and conditions for different types of Awards, for different Participants receiving the same type of Awards, and for the same Participant for each Award such Participant may receive, whether or not granted at different times. 4.2 Administration. The Committee shall be responsible for the administration of the Plan. The Committee, by majority action thereof, is authorized to prescribe, amend, and rescind rules and regulations relating to the Plan, to provide for conditions deemed necessary or advisable to protect the interests of the Company, and to make all other determinations necessary or advisable for the administration and interpretation of the Plan in order to carry out its provisions and purposes. Determinations, interpretations, or other actions made or taken by the Committee pursuant to the provisions of the Plan shall be final, binding, and conclusive for all purposes and upon all persons. Notwithstanding anything else contained in the Plan to the contrary, neither the Committee nor the Board shall have any discretion regarding whether an Eligible Director receives a Director Award pursuant to Section 7.1 or regarding the terms of any such Director Award, including, without limitation, the number of shares subject to any such Director Award. SECTION 5 STOCK SUBJECT TO PLAN 5.1 Number. Subject to the provisions of Section 5.3, the number of shares of Stock subject to Awards (including Director Awards) under the Plan may not exceed 11,000,000 shares of Stock. The shares to be delivered under the Plan may consist, in whole or in part, of treasury Stock or authorized but unissued Stock, not reserved for any other purpose. The maximum number of shares of Stock with respect to which Awards may be granted to any one Employee under the Plan is 10% of the aggregate number of shares of Stock available for Awards under Section 5.1. 5.2 Cancelled, Terminated or Forfeited Awards. Any shares of Stock subject to an Award which for any reason are cancelled, terminated or otherwise settled without the issuance of any Stock shall again be available for Awards under the Plan. 5.3 Adjustment in Capitalization. In the event of any Stock dividend or Stock split, recapitalization (including, without limitation, the payment of an extraordinary dividend), merger, consolidation, combination, spin-off, distribution of assets to stockholders, exchange of shares, or other similar corporate change, (i) the aggregate number of shares of Stock available for Awards under Section 5.1 and (ii) the number of shares and exercise price with respect to Options and the number, prices and dollar value of other Awards, may be appropriately adjusted by the Committee, whose determination shall be conclusive. If, pursuant to the preceding sentence, an adjustment is made to the number of shares of Stock authorized for issuance under the Plan, a corresponding adjustment shall be made to the number of shares subject to each Director Award thereafter granted pursuant to Section 7.1. SECTION 6 STOCK OPTIONS 6.1 Grant of Options. Options may be granted to Participants at such time or times as shall be determined by the Committee. Options granted under the Plan may be of two types: (i) Incentive Stock Options and (ii) Nonstatutory Stock Options. The Committee shall have complete discretion in determining the number of Options, if any, to be granted to a Participant. Each Option shall be evidenced by an Option agreement that shall specify the type of Option granted, the exercise price, the duration of the Option, the number of shares of Stock to which the Option pertains, the exercisability (if any) of the Option in the event of death, retirement, disability or termination of employment, and such other terms and conditions not inconsistent with the Plan as the Committee shall determine. 6.2 Option Price. Nonstatutory Stock Options and Incentive Stock Options granted pursuant to the Plan shall have an exercise price which is not less than the Fair Market Value on the date the Option is granted. 6.3 Exercise of Options. Options awarded to a Participant under the Plan shall be exercisable at such times and shall be subject to such restrictions and conditions as the Committee may impose, subject to the Committee's right to accelerate the exercisability of such Option in its discretion. Notwithstanding the foregoing, no Option shall be exercisable for more than ten years after the date on which it is granted. 6.4 Payment. The Committee shall establish procedures governing the exercise of Options, which shall require that written notice of exercise be given and that the Option price be paid in full in cash or cash equivalents, including by personal check, at the time of exercise or pursuant to any arrangement that the Committee shall approve. The Committee may, in its discretion, permit a Participant to make payment (i) in Stock already owned by the Participant valued at its Fair Market Value on the date of exercise (if such Stock has been owned by the Participant for at least six months) or (ii) by electing to have the Company retain Stock which would otherwise be issued on exercise of the Option, valued at its Fair Market Value on the date of exercise. As soon as practicable after receipt of a written exercise notice and full payment of the exercise price, the Company shall deliver to the Participant a certificate or certificates representing the acquired shares of Stock. 6.5 Incentive Stock Options. Notwithstanding anything in the Plan to the contrary, no term of this Plan relating to Incentive Stock Options shall be interpreted, amended or altered, nor shall any discretion or authority granted under the Plan be so exercised, so as to disqualify the Plan under Section 422 of the Code, or, without the consent of any Participant affected thereby, to cause any Incentive Stock Option previously granted to fail to qualify for the Federal income tax treatment afforded under Section 421 of the Code. In furtherance of the foregoing, (i) the aggregate Fair Market Value of shares of Stock (determined at the time of grant of each Option) with respect to which Incentive Stock Options are exercisable for the first time by an Employee during any calendar year shall not exceed $100,000 or such other amount as may be required by the Code, (ii) an Incentive Stock Option may not be exercised more than three months following termination of employment (except as the Committee may otherwise determine in the event of death or disability), and (iii) if the Employee receiving an Incentive Stock Option owns Stock possessing more than 10% of the total combined voting power of all classes of Stock of the Company, the exercise price of the Option shall be at least 110% of Fair Market Value and the Option shall not be exercisable after the expiration of five years from the date of grant. An Incentive Stock Option may be granted only to Employees who are employed by the Company or a "subsidiary corporation" as defined in Section 425 of the Code. SECTION 7 DIRECTOR AWARDS 7.1 Amount of Award. Each Eligible Director shall receive annually (i) a grant of a Nonstatutory Stock Option for 4,500 shares of Stock and (ii) a grant of 900 shares of Stock from the Company's treasury shares. Such grants shall be made each year immediately following the annual meeting of Company stockholders to those persons who are Eligible Directors immediately following such meeting. 7.2 No Other Awards. An Eligible Director shall not receive any other Award under the Plan. SECTION 8 STOCK APPRECIATION RIGHTS 8.1 SAR's In Tandem with Options. Stock Appreciation Rights may be granted to Participants in tandem with any Option granted under the Plan, either at or after the time of the grant of such Option, subject to such terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine. Each Stock Appreciation Right shall only be exercisable to the extent that the corresponding Option is exercisable, and shall terminate upon termination or exercise of the corresponding Option. Upon the exercise of any Stock Appreciation Right, the corresponding Option shall terminate. 8.2 Other Stock Appreciation Rights. Stock Appreciation Rights may also be granted to Participants separately from any Option, subject to such terms and conditions, not inconsistent with the provisions of the Plan, as the Committee shall determine. SECTION 9 RESTRICTED STOCK 9.1 Grant of Restricted Stock. The Committee may grant Restricted Stock to Participants at such times and in such amounts, and subject to such other terms and conditions not inconsistent with the Plan as it shall determine. Each grant of Restricted Stock shall be subject to such restrictions, which may relate to continued employment with the Company, performance of the Company, or other restrictions, as the Committee may determine. Each grant of Restricted Stock shall be evidenced by a written agreement setting forth the terms of such Award. 9.2 Removal of Restrictions. The Committee may accelerate or waive such restrictions in whole or in part at any time in its discretion. SECTION 10 STOCK BONUSES 10.1 Grant of Stock Bonuses. The Committee may grant a Stock Bonus to a Participant at such times and in such amounts, and subject to such other terms and conditions not inconsistent with the Plan, as it shall determine. 10.2 Effect on Compensation. The Committee may from time to time grant a Stock Bonus in lieu of salary or cash bonuses otherwise payable to a Participant. SECTION 11 AMENDMENT, MODIFICATION, AND TERMINATION OF PLAN 11.1 General. The Board may from time to time amend, modify or terminate any or all of the provisions of the Plan, subject to the provisions of this Section 11.1. The Board may not change the Plan in a manner which would prevent outstanding Incentive Stock Options granted under the Plan from being Incentive Stock Options without the consent of the optionees concerned. Furthermore, the Board may not make any amendment which would (i) materially modify the requirements for participation in the Plan, (ii) increase the number of shares of Stock subject to Awards under the Plan pursuant to Section 5.1, or (iii) make any other amendments which would cause the Plan not to comply with Rule 16b-3 under the Act, in each case without the approval of the Company's stockholders. No amendment or modification shall affect the rights of any Employee with respect to a previously granted Award, nor shall any amendment or modification affect the rights of any Eligible Director pursuant to a previously granted Director Award. 11.2 Termination of Plan. No further Options shall be granted under the Plan subsequent to September 30, 2005, or such earlier date as may be determined by the Board. SECTION 12 MISCELLANEOUS PROVISIONS 12.1 Nontransferability of Awards. No Awards granted under the Plan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution; provided, the Committee may grant Options which are transferable, without payment of consideration, to immediate family members of the Participant or to trusts or partnerships for such family members, with any such transferee subject to all conditions of the Option. Subject to the preceding sentence, all rights with respect to Awards granted to a Participant under the Plan shall be exercisable during the Participant's lifetime only by such Participant and all rights with respect to any Director Awards granted to an Eligible Director shall be exercisable during the Director's lifetime only by such Eligible Director. 12.2 Beneficiary Designation. Each Participant under the Plan may from time to time name any beneficiary or beneficiaries (who may be named contingent or successively) to whom any benefit under the Plan is to be paid or by whom any right under the Plan is to be exercised in case of his death. Each designation will revoke all prior designations by the same Participant shall be in a form prescribed by the Committee, and will be effective only when filed in writing with the Committee. In the absence of any such designation, Awards outstanding at death may be exercised by the Participant's surviving spouse, if any, or otherwise by his estate. 12.3 No Guarantee of Employment or Participation. Nothing in the Plan shall interfere with or limit in any way the right of the Company or any Subsidiary to terminate any Participant's employment at any time, nor confer upon any Participant any right to continue in the employ of the Company or any Subsidiary. No Employee shall have a right to be selected as a Participant, or, having been so selected, to receive any future Awards. 12.4 Tax Withholding. The Company shall have the power to withhold, or require a Participant or Eligible Director to remit to the Company, an amount sufficient to satisfy federal, state, and local withholding tax requirements on any Award under the Plan, and the Company may defer issuance of Stock until such requirements are satisfied. The Committee may, in its discretion, permit a Participant to elect, subject to such conditions as the Committee shall impose, (i) to have shares of Stock otherwise issuable under the Plan withheld by the Company or (ii) to deliver to the Company previously acquired shares of Stock, in each case having a Fair Market Value sufficient to satisfy all or part of the Participant's estimated total federal, state and local tax obligation associated with the transaction. 12.5 Change of Control. On the date of a Change of Control (as herein defined), all outstanding Options and Stock Appreciation Rights shall become immediately exercisable and all restrictions with respect to Restricted Stock shall lapse. Change of Control shall mean: (a) The acquisition (other than from the Company) by any person, entity or "group," within the meaning of Section 13(d)(3) or 14(d)(2) of the Act (excluding, for this purpose, the Company or its subsidiaries, or any employee benefit plan of the Company or its subsidiaries which acquires beneficial ownership of voting securities of the Company) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Act) of 30% or more of either the then outstanding shares of common stock or the combined voting power of the Company's then outstanding voting securities entitled to vote generally in the election of directors; or (b) Individuals who, as of the date hereof, constitute the Board (as of the date hereof the "Incumbent Board") cease for any reason to constitute at least a majority of the Board, provided that any person becoming a director subsequent to the date hereof whose election, or nomination for the election by the Company's stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be, for purposes of this Plan, considered as though such person were a member of the Incumbent Board; or (c) Approval by the stockholders of the Company of a reorganization, merger or consolidation, in each case, with respect to which persons who were the stockholders of the Company immediately prior to such reorganization, merger or consolidation do not, immediately thereafter, own more than 50% of the combined voting power entitled to vote generally in the election of directors of the reorganized, merged or consolidated company's then outstanding voting securities, or a liquidation or dissolution of the Company or of the sale of all or substantially all of the assets of the Company. 12.6 Company Intent. The Company intends that the Plan comply in all respects with Rule 16b-3 under the Act, and any ambiguities or inconsistencies in the construction of the Plan shall be interpreted to give effect to such intention. 12.7 Requirements of Law. The granting of Awards and the issuance of shares of Stock shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or securities exchanges as may be required. 12.8 Effective Date. The Plan shall be effective upon its adoption by the Board subject to approval by the Company's stockholders at the 1995 annual stockholders' meeting. 12.9 Governing Law. The Plan, and all agreements hereunder, shall be construed in accordance with and governed by the laws of the State of Delaware. EX-12 3 EXHIBIT 12 CONAGRA, INC. AND SUBSIDIARIES COMPUTATIONS OF RATIOS OF EARNINGS TO FIXED CHARGES AND OF EARNINGS TO COMBINED FIXED CHARGES & PREFERRED STOCK DIVIDENDS ($ IN MILLIONS) Three Months Ended August 27, 1995 ____________ Fixed charges: Interest expense $ 87.6 Capitalized interest 1.0 Interest in cost of goods sold 3.2 One third of non-cancellable lease rent 9.8 ------------ Total fixed charges (A) 101.6 Add preferred stock dividends of the company 8.6 ------------ Total fixed charges and preferred stock dividends (B) 110.2 ============ Earnings: Pretax income 147.6 Adjustment for unconsolidated subidiaries 0.4 ------------ Pretax income of the Company as a whole 148.0 Add fixed charges 101.6 Less capitalized interest (1.0) ------------ Earnings and fixed charges (C) 248.6 ============ Ratio of earnings to fixed charges (C/A) 2.4 Ratio of earnings to combined fixed charges and preferred stock dividends (C/B) 2.3 EXHIBIT 12 (Continued) For the purpose of computing the above ratio of earnings to fixed charges, earnings consist of income before taxes and fixed charges. Fixed charges, for the purpose of computing earnings are adjusted to exclude interest capitalized. Fixed charges include interest on both long and short-term debt (whether said interest is expensed or capitalized and including interest charged to cost of goods sold), and a portion of noncancellable rental expense representative of the interest factor. The ratio is computed using the amounts for ConAgra as a whole, including its majority-owned subsidiaries, whether or not consolidated, and its proportionate share of any 50% owned subsidiaries, whether or not ConAgra guarantees obligations of these subsidiaries. For purposes of calculating the above ratio of earnings to combined fixed charges and preferred dividends, preferred stock dividend requirements (computed by increasing preferred stock dividends to an amount representing the pre-tax earnings which would be required to cover such dividend requirements) are combined with fixed charges as described above, and the total is divided into earnings as described above. EX-27 4
5 1000 3-mos may-26-1996 aug-27-1995 92,200 0 2,533,600 61,300 3,509,700 6,475,700 4,666,200 1,800,500 12,290,200 5,828,000 2,414,200 1,264,600 269,500 525,000 1,068,500 12,290,200 6,436,400 6,436,400 5,634,400 5,634,400 578,300 0 75,900 147,600 60,500 87,100 0 0 0 87,100 0.36 0
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