-----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, GSse2NTYOoVa/dyv1vx8XZqdAm476Jyf1Jpwo47hLd8cHkTYpqlVrIW//C8nNKyP Hpv8GTB7lIkGlbm0jzqeeQ== 0000023217-97-000004.txt : 19970409 0000023217-97-000004.hdr.sgml : 19970409 ACCESSION NUMBER: 0000023217-97-000004 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 19970223 FILED AS OF DATE: 19970408 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: 001-07275 FILM NUMBER: 97576663 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 February 23, 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 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 March 23, 1997 was 238,804,275 PART I - FINANCIAL INFORMATION CONAGRA, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in Millions) FEB 23, MAY 26, FEB 25, 1997 1996 1996 ________ ________ ________ ASSETS Current assets: Cash and cash equivalents $ 64.5 $ 113.7 $ 59.1 Receivables, less allowance for doubtful accounts of $75.4, $52.1 and $72.4 2,053.0 1,428.4 2,092.0 Inventory: Hedged commodities 1,143.6 1,369.4 1,484.9 Other 2,548.4 2,204.0 2,463.9 _________ _________ ________ Total inventory 3,692.0 3,573.4 3,948.8 Prepaid expenses 434.1 451.4 407.2 _________ _________ ________ Total current assets 6,243.6 5,566.9 6,507.1 _________ _________ ________ Property, plant and equipment: Cost 5,321.2 4,971.3 5,291.2 Less accumulated depreciation 2,091.2 1,915.0 2,008.1 Less valuation reserve related to restructuring 152.0 235.8 - __________ _________ _________ Property, plant and equipment, net 3,078.0 2,820.5 3,283.1 Brands, trademarks and goodwill, at cost less accumulated amortization 2,446.4 2,405.6 2,549.4 Other assets 409.6 403.6 415.6 __________ __________ __________ $ 12,177.6 $ 11,196.6 $ 12,755.2 __________ __________ __________ __________ __________ __________ The accompanying notes are an integral part of the consolidated financial statements. CONAGRA, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Dollars in Millions) FEB 23, MAY 26, FEB 25, 1997 1996 1996 __________ __________ ________ LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Notes payable $ 1,992.8 $ 416.3 $ 2,810.9 Current installments of long-term debt 340.6 142.5 136.4 Accounts payable 2,025.1 1,856.9 1,785.8 Advances on sales 217.4 1,390.9 293.3 Other accrued liabilities 1,411.8 1,387.1 1,473.8 __________ __________ ________ Total current liabilities 5,987.7 5,193.7 6,500.2 __________ __________ ________ Senior long-term debt, excluding current installments 1,583.5 1,512.9 1,600.3 Other noncurrent liabilities 911.5 959.5 904.7 Subordinated debt 750.0 750.0 750.0 Preferred securities of subsidiary company 525.0 525.0 525.0 Common stockholders' equity: Common stock of $5 par value, authorized 1,200,000,000 shares, issued 253,060,007, 252,990,917 and 253,151,573 1,265.3 1,264.9 1,265.8 Additional paid-in capital 573.0 423.1 454.4 Retained earnings 1,935.8 1,683.5 1,931.1 Foreign currency translation adjustment (25.8) (39.1) (39.1) Less treasury stock, at cost, common shares 13,422,401, 9,834,464 and 10,073,548 (556.8) (390.0) (399.1) __________ ________ _______ 3,191.5 2,942.4 3,213.1 Less unearned restricted stock and value of 13,854,176, 16,014,644 and 16,647,309 common shares held in EEF (771.6) (686.9) (738.1) __________ _________ ________ Total common stockholders' equity 2,419.9 2,255.5 2,475.0 __________ _________ ________ $ 12,177.6 $11,196.6 $12,755.2 __________ _________ ________ __________ _________ ________ 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 FEB 23, FEB 25, 1997 1996 __________ __________ Net sales $ 5,635.0 $ 5,772.9 __________ __________ Costs and expenses: Cost of goods sold 4,757.4 4,905.2 Selling, general and administrative expenses 561.2 570.5 Interest expense, net 73.3 82.6 __________ __________ 5,391.9 5,558.3 __________ __________ Income before income taxes 243.1 214.6 Income taxes 98.0 86.2 __________ __________ Net income 145.1 128.4 Less preferred dividends - - __________ __________ Net income available for common stock $ 145.1 $ 128.4 __________ __________ __________ __________ Earnings per common and common equivalent share $ 0.63 $ 0.55 __________ __________ __________ __________ Weighted average number of common and common equivalent shares outstanding 229.8 232.7 __________ __________ __________ __________ Cash dividends declared per common share $ 0.273 $ 0.238 __________ __________ __________ __________ CONAGRA, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EARNINGS (Dollars and shares in millions except per share amounts) THIRTY-NINE WEEKS ENDED FEB 23, FEB 25, 1997 1996 __________ __________ Net sales $ 18,803.8 $ 18,839.0 __________ __________ Costs and expenses: Cost of goods sold 16,176.1 16,217.0 Selling, general and administrative expenses 1,689.4 1,740.4 Interest expense, net 216.1 236.1 __________ __________ 18,081.6 18,193.5 __________ __________ Income before income taxes 722.2 645.5 Income taxes 293.7 262.9 __________ __________ Net income 428.5 382.6 Less preferred dividends - 8.6 __________ __________ Net income available for common stock $ 428.5 $ 374.0 __________ __________ __________ __________ Earnings per common and common equivalent share $ 1.87 $ 1.63 __________ __________ __________ __________ Weighted average number of common and common equivalent shares outstanding 229.5 229.0 __________ __________ __________ __________ Cash dividends declared per common share $ 0.783 $ 0.683 __________ __________ __________ __________ The accompanying notes are an integral part of the consolidated financial statements. CONAGRA, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Dollars in Millions) THIRTY-NINE WEEKS ENDED FEB 23, FEB 25, Decrease in Cash and Cash Equivalents 1997 1996 __________ __________ Cash flows from operating activities Net income $ 428.5 $ 382.6 Adjustments to reconcile net income to net cash used in operating activities Depreciation and other amortization 261.4 241.4 Goodwill amortization 52.2 54.0 Other noncash items (includes nonpension postretirement benefits) (6.6) 30.2 Change in assets and liabilities before effects from business acquisitions (1,593.7) (1,749.0) __________ __________ Net cash flows from operating activities (858.2) (1,040.8) __________ __________ Cash flows from investing activities: Sale of property, plant and equipment 24.6 66.4 Additions to property, plant and equipment (446.1) (414.6) Payment for business acquisitions (197.8) (493.6) Monfort Finance Company notes receivable (17.4) 70.4 Other items (14.3) 26.7 __________ __________ Net cash flows from investing activities (651.0) (744.7) __________ __________ Cash flows from financing activities: Net short-term borrowings 1,561.2 2,808.2 Decrease in accounts receivable sold (50.5) - Proceeds from issuance of long-term debt 397.5 - Cash dividends paid (168.5) (160.5) Repayment of long-term debt (130.2) (163.0) Treasury stock purchases (160.0) (664.0) Employee Equity Fund stock transactions 12.4 7.5 Other items (1.9) (43.6) __________ __________ Net cash flows from financing activities 1,460.0 1,784.6 __________ __________ Net decrease in cash and cash equivalents (49.2) (0.9) Cash and cash equivalents at beginning of year 113.7 60.0 __________ __________ Cash and cash equivalents at end of period $ 64.5 $ 59.1 __________ __________ __________ __________ The accompanying notes are an integral part of the consolidated financial statements. CONAGRA, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS FEBRUARY 23, 1997 (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 1996 annual report, which report was incorporated by reference in Form 10-K for the fiscal year ended May 26, 1996. (2) The composition of inventories is as follows (in millions): FEB 23, MAY 26, FEB 25, 1997 1996 1996 __________ __________ __________ Hedged commodities $ 1,143.6 $ 1,369.4 $ 1,484.9 Food products and livestock 1,252.2 1,219.9 1,385.3 Agricultural chemicals, fertilizer and feed 498.4 399.4 430.0 Retail merchandise 106.0 122.7 163.4 Other, principally ingredients and supplies 691.8 462.0 485.2 __________ __________ __________ $ 3,692.0 $ 3,573.4 $ 3,948.8 __________ __________ __________ __________ __________ __________ (3) On August 29, 1996, the Company purchased certain assets of Gilroy Foods from McCormick & Company, Inc. for approximately $121 million in cash. Gilroy Foods, based in Gilroy, California, manufactures dehydrated garlic and onion products principally for industrial markets. Gilroy Foods' sales in 1995 were approximately $200 million. (4) 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 5/26/96 $ $1,264.9 $ $423.1 $ $1,683.5 $ ($39.1)$ ($390.0)$ ($686.9) $ $2,255.5 Shares issued Stock option and incentive plans 0.4 1.0 0.5 1.9 EEF*: stock option, incentive and other employee benefit plans 7.0 57.0 64.0 Fair market valuation of EEF shares 141.9 (141.9) - Acquisitions 0.5 0.5 Shares acquired Incentive plans (7.8) 0.2 (7.6) Treasury shares purchased (160.0) (160.0) Foreign currency translation adjustment 13.3 13.3 Cash dividends declared - common stock (176.2) (176.2) Net income 428.5 428.5 ___________ ___________ ___________ ___________ ___________ ___________ ___________ Balance 2/23/97 $ $1,265.3 $ $573.0 $ $1,935.8 $ ($25.8)$ ($556.8)$ ($771.6) $ $2,419.9 ___________ ___________ ___________ ___________ ___________ ___________ ___________ ___________ ___________ ___________ ___________ ___________ ___________ ___________ *Employee Equity Fund
(5) In fiscal 1991, 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. As a result of a settlement reached with the Internal Revenue Service in fiscal 1995, ConAgra released $230.0 million of a valuation allowance and reduced noncurrent liabilities by $135.0 million, with a resulting reduction of goodwill associated with the Beatrice acquisition of $365.0 million. Various state tax returns of Beatrice 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 43 Superfund, proposed Superfund or state-equivalent sites. Beatrice has paid or is in the process of paying its liability share at 41 of these 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 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. (6) 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. (7) The Company adopted Statement of Financial Accounting Standards No. 125 ("SFAS 125"), which is effective for transfers of financial assets beginning in 1997. SFAS 125 will have no impact on the Company's reported results of operation or financial position. (8) On October 3, 1996, the Company issued $400 million of senior notes with an interest rate of 7.125% due October 1, 2026 and redeemable at the option of the holders on October 1, 2006. The notes were priced at 99.375% of par. (8) In December, 1996, the Company's Board of Directors authorized ConAgra to purchase up to five million shares of the Company's outstanding common stock from time to time in the open market in continuation of the Company's systematic pattern of common stock purchases designed to avoid the dilutive effect on earnings per share of stock based compensation programs and acquisitions using stock accounted for as purchases. CONAGRA, INC. AND SUBSIDIARIES MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 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 1997 third quarter and first nine months are not necessarily indicative of results which may be attained in the future. FINANCIAL CONDITION Versus fiscal year end 1996, the Company's capital investment (working capital plus noncurrent assets) increased $187.0 million. Working capital decreased $117.3 million and noncurrent assets increased $304.3 million. The decrease in working capital resulted from an increase in short-term debt due to business acquisitions, normal property, plant and equipment additions, from treasury stock purchases and a normal seasonal increase in accounts receivable. The Company's objective is that senior long-term debt normally will not exceed 30 percent of total long-term debt plus equity. At February 23,1997, senior long-term debt was 30 percent of total long-term debt plus equity compared to 30 percent at May 26,1996 and 30 percent at February 25, 1996. 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 FEB. 23, 1997 & FEB. 25, 1996 THIRTEEN WEEKS THIRTY-NINE WEEKS DOLLARS % DOLLARS % ________________________________ Net sales (137.9) (2.4) (35.2) (0.2) Cost of goods sold (147.8) (3.0) (40.9) (0.3) Gross profit 9.9 1.1 5.7 0.2 Selling, general and administrative expenses (9.3) (1.6) (51.0) (2.9) Interest expense, net (9.3) (11.3) (20.0) (8.5) Income before income taxes 28.5 13.3 76.7 11.9 Income taxes 11.8 13.7 30.8 11.7 Net income 16.7 13.0 45.9 12.0 Preferred Dividends - - (8.6) (100.0) Net Income available for common stock 16.7 13.0 54.5 14.6 Earnings per common and common equivalent share 0.08 14.5 0.24 14.7 Two of ConAgra's industry segments, Grocery/Diversified Products and Refrigerated Foods increased operating profit in the third quarter while operating profit in the Foods Inputs & Ingredients segment decreased, versus third quarter fiscal 1996. Operating profit for the first nine months of fiscal 1997, versus the same period in fiscal 1996, increased in the Foods Inputs & Ingredients and the Grocery/Diversified Products segments. The increase in those segments was somewhat offset by a decrease in the Refrigerated Foods segment operating profit for the first nine months. ConAgra's total sales and cost of sales were lower by 2 percent and 3 percent, respectively, in the third quarter and about even for the first nine months of fiscal 1997, compared to the same periods last year. Selling, general and administrative expenses were down 2 percent in the third quarter and down 3 percent for the first nine months of fiscal 1997 versus fiscal 1996. In the Grocery/Diversified Products segment, sales and related cost of goods sold increased during the third quarter and first nine months of fiscal 1997 versus fiscal 1996. In the Foods Inputs & Ingredients segment, increased sales and cost of sales in the specialty food ingredient and agri-products businesses were offset by declines in the other businesses. Refrigerated Foods segment sales and related cost of sales declined in the third quarter and first nine months. Selling, general and administrative expenses for all segments in the third quarter and first nine months of fiscal 1997 were lower than the same periods in fiscal 1996. Net income increased $16.7 million in the third quarter and $45.9 million in the first nine months of fiscal 1997 versus the same periods last year. In the Grocery/Diversified Products segment, operating profit increased 12 percent in the third quarter and 20 percent in the first nine months of fiscal 1997 versus the same periods last year. Sales increased 4 percent in fiscal 1997's third quarter and 8 percent in the first nine months versus the same periods in fiscal 1996. ConAgra Frozen Foods increased third quarter and nine month operating profit over 20 percent. Hunt-Wesson's operating profit increased in the third quarter and first nine months. Combined Hunt-Wesson/Frozen Foods unit volume growth was up 4 percent through nine months, but down about 3 percent in the third quarter, reflecting soft grocery industry sales. Benefiting from value-added products, operating productivity and volume growth, the Lamb-Weston potato products business increased third quarter and nine month operating profit. Golden Valley Microwave Foods' operating profit was down in the third quarter but up 22 percent through nine months. Seafood operating profit increased in both periods. In ConAgra's Refrigerated Foods segment, operating profit increased 35 percent in the third quarter and declined 11 percent in the first nine months of fiscal 1997 versus the same periods in fiscal 1996. Segment sales decreased 2 percent in the third quarter and 3 percent in the first nine months of fiscal 1997 primarily due to beef and poultry restructuring initiatives subsequent to last year's third quarter. Branded processed meats, the segment's largest profit contributor increased operating profit 24 percent in the third quarter and 13 percent for the first nine months of fiscal 1997. U.S beef operating profit rebounded in this year's third quarter and was up through nine months. Australia beef operating profit improved in both periods. Third quarter and nine month operating profit decreased in the pork business. However, the Company considers this earnings level to be satisfactory given the industry's current high cost of raw materials. Poultry products operating profit decreased in both periods as did operating profit in the cheese business. In ConAgra's Food Inputs & Ingredients segment, operating profit decreased 14 percent in the third quarter and increased 6 percent in the first nine months of fiscal 1997 compared to the same periods in fiscal 1996. Segment sales decreased 10 percent in the third quarter and 1 percent through nine months. Business dispositions, lower wheat prices and reduced international fertilizer sales drove the sales decline. Third quarter operating profit gains in a number of businesses, notably flour milling and specialty food ingredients, were more than offset by declines in other businesses, in particular specialty grain and grain merchandising. Sources of the nine month operating profit gain included flour milling, specialty food ingredients, European operations and dry edible beans partially offset by profit declines in specialty grain and other businesses. United Agri Products, the major crop inputs business, and specialty retailing increased operating profit in both periods. 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 operating profit. For financial businesses, operating profit includes the effect of interest, which is a large element of their operating costs. Summarizing ConAgra's results for fiscal 1997's third quarter compared to fiscal 1996's third quarter: earnings per share 63 cents, up 14.5 percent from 55 cents; net income and net income available for common stock (net income minus preferred dividends) $145.1 million, up 13 percent from $128.4 million; net sales $5.64 billion, down 2 percent from $5.77 billion. For fiscal 1997's first nine months: earnings per share $1.87, up 14.7 percent from $1.63; net income $428.5 million, up 12 percent from $382.6 million; net income available for common stock $428.5 million, up 15 percent from $374.0 million; net sales $18.80 billion, down from $18.84 billion. As mentioned, fiscal 1997 third quarter and nine month sales were reduced by business dispositions and restructuring initiatives. For the nine month period, the relevant net earnings comparison is net income available for common stock because it includes comparable financing expense in both years: preferred dividends in fiscal 1996 and the cost of preferred stock redemption in fiscal 1997. Weighted average shares outstanding decreased in fiscal 1997's third quarter over the same period in fiscal 1996 primarily due to the timing of common stock repurchases. CONAGRA, INC. AND SUBSIDIARIES PART II - OTHER INFORMATION ITEM 2(c). RECENT SALES OF UNREGISTERED SECURITIES ConAgra issued 23,159 shares of its common stock in connection with the acquisition of Creative Seasonings, Inc. in a merger transaction on January 10, 1997. The common stock was issued to the two shareholders of Creative Seasonings, Inc. in reliance on the exemption from registration provided by Section 4(2) of the Securities Act of 1933 and Regulation D thereunder. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K. (A) EXHIBITS. 10.1 - Employment contracts between the Company and Bruce Rohde. 10.2 - Second Amendment to the Directors' Unfunded Deferred Compensation Plan. 12 - Statement regarding computation of ratio of earnings to fixed charges. (B) REPORTS ON FORM 8-K. None. 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 8th day of April, 1997. EXHIBIT INDEX EXHIBIT DESCRIPTION PAGE 10.1 Employment contracts between the Company and Bruce Rohde.............. 18 10.2 Second Amendment to the Directors' Unfunded Deferred Compensation Plan.. 35 12 Statement regarding computation of ratio of earnings to fixed charges... 36 EX-10 2 EMPLOYMENT AGREEMENT AGREEMENT made by and between ConAgra, Inc., a Delaware corporation ("Company"), and Bruce Rohde ("Executive") effective as of the 26th day of August, 1996. The Board of Directors of the Company ("Board") has determined that it is in the best interests of the Company to obtain and retain the services of Executive and to induce Executive to leave his current position in order to accept a position with the Company. In order to accomplish this objective, the Board has caused the Company to enter into this Agreement. NOW, THEREFORE, it is agreed as follows: 1. Term of Employment. Executive's term of employment under this Agreement shall commence on August 26, 1996 ("Effective Date") and shall continue in accordance with the terms hereof until a termination of Executive's employment. 2. Position and Duties. 2.1 Position. The Company employs Executive as President of the Company. The Board has elected Executive as Vice Chairman of the Board and a member of the Executive Committee of the Board. Executive shall have the customary powers, responsibilities and authorities of presidents of corporations of the size, type and nature of the Company. Executive's office shall be at the principal executive offices of the Company in Omaha, Nebraska. 2.2 Duties. Executive shall devote his full working time and efforts to the performance of the duties outlined above. Executive may, consistent with his duties hereunder, engage in charitable and community affairs, manage his personal investments and (subject to the prior approval of the Board) serve on the board of directors of other companies. 3. Compensation. 3.1 Base Salary. The Company shall pay Executive a Base Salary ("Base Salary") at the rate of $750,000 per annum. The base salary shall be payable in accordance with the ordinary payroll practices of the Company. Executive's rate of Base Salary shall be reviewed for possible increases by the Board at least annually. 3.2 Annual Incentive Bonus. Executive shall be entitled to receive an annual bonus under the Company's Executive Annual Incentive Plan ("Annual Bonus Plan"), or any successor plan subsequently available to senior executive officers. Executive's target bonus opportunity under the Annual Bonus Plan shall not be less than 80% of Executive's Base Salary. The performance goals with respect to such target bonus opportunity shall be established annually by the Board on a basis consistent with the establishment of such performance goals for other senior executive officers of the Company. 3.3 Long Term Senior Management Incentive Plan. Executive shall participant in Company's Long Term Senior Management Incentive Plan ("LTSMIP"). Executive shall receive three units in the LTSMIP for fiscal year 1997; provided, any payments to Executive for fiscal 1997 shall be prorated and based on Executive's employment from the Effective Date to the end of the fiscal year. Executive's participation in the LTSMIP shall increase (i) to four units for fiscal year 1998 and (ii) to six units at such time as Executive becomes Chief Executive Officer of ConAgra. 3.4 Restricted Stock Grant. Pursuant to the Company's 1995 Stock Plan, the Human Resources Committee of the Board ("Committee") has granted to Executive an award of 100,000 restricted shares of Company common stock on the Effective Date. Such shares shall vest at the rate of 10% on the last day of each fiscal year of the Company, with the first 10% vesting on the last day of fiscal 1997. 3.5 Stock Option Grant. Pursuant to the Company's 1995 Stock Plan, the Committee has granted to Executive on the Effective Date options to acquire 100,000 shares of Company common stock. The exercise price of such options is $43.00 per share, the closing price of the Company's common stock on the New York Stock Exchange on the date of grant. Such options shall vest and become exercisable at the rate of 20% per year on the last day of each fiscal year of the Company, with the first 20% becoming vested and exercisable on the last day of fiscal 1997. 4. Other Benefits. 4.1 Employee Benefit Plans. The Company shall provide Executive with coverage under all employee benefit programs, plans and practices, in accordance with the terms thereof, which the Company makes available to senior executive officers. 4.2 Pension Credit. At such time as Executive becomes Chief Executive Officer of the Company, Executive shall be credited with sufficient prior years of service for purposes of determining Executive's benefit payable under the Company's supplemental pension and related benefit plans so that Executive would have 25 years of service if Executive remained employed by the Company until age 65. 4.3 Directors and Officers Liability Coverage. Executive shall be entitled to the same coverage under the Company's directors and officers liability insurance policies as is available to senior executive officers and directors with the Company. In any event, the Company shall indemnify and hold Executive harmless, to the fullest extent permitted by the laws of the State of Delaware, from and against all costs, charges and expenses (including reasonable attorneys' fees) incurred or sustained in connection with any action, suit or proceeding to which Executive or his legal representatives may be made a party by reason of Executive's being or having been a director or officer of the Company or any of its affiliates. The provisions of this subparagraph shall survive the termination of this Agreement for any reason. 4.4 Expenses. Executive is authorized to incur reasonable expenses in carrying out his duties under this Agreement, including expenses for travel and similar items related to such duties. The Company shall reimburse Executive for all such expenses upon presentation by Executive from time to time of an itemized account of such expenditures. 5. Termination of Employment. The Company may terminate Executive's employment at any time for any reason, and Executive may terminate his employment at any time for Good Reason, subject to the terms of this Section 5. For purposes of this Section 5, the following terms shall have the following meanings: (a) "Cause" shall be limited to (i) action by Executive involving willful malfeasance in connection with his employment having a material adverse effect on the Company, (ii) substantial and continuing refusal by Executive in willful breach of this Agreement to perform the duties ordinarily performed by an executive occupying his position, which refusal has a material adverse effect on the Company, or (iii) Executive being convicted of a felony involving moral turpitude under the laws of the United States or any state. (b) "Good Reason" shall mean (i) the assignment to Executive of duties materially inconsistent with Executive's position or any removal of Executive from, or failure to elect or reelect Executive to, the position of President of the Company and Vice Chairman of the Board of Directors (or other position as may be agreed to by Executive), except in any case in connection with the termination of Executive's employment for Cause, Permanent Disability, death, or voluntary termination by Executive without Good Reason, (ii) a reduction of Executive's Base Salary or annual target bonus opportunity as in effect on the Effective Date or as the same may be increased from time to time, (iii) any material breach by the Company of any provision of this Agreement, (iv) a requirement that Executive be based at any office or location other than Omaha, Nebraska at any time within four years following the Effective Date or (v) a Change of Control of the Company occurs. (c) "Change of Control" shall have the meaning provided in the Conditional Employment Agreement between the Company and Executive dated of even date herewith. (d) "Permanent Disability" shall mean the permanent disability of Executive as defined under the Company's Long-Term Disability Plan. 5.1 Termination Upon Death or Permanent Disability. In the event Executive's employment with the Company is terminated by reason of Executive's death or Permanent Disability (i) all restrictions on previously-granted restricted stock awards shall lapse and such shares shall become fully vested, (ii) all options previously granted to Executive in connection with the LTSMIP shall become fully vested and exercisable during the remainder of the term of such options, and all then vested options granted in accordance with Section 3.5 above shall remain exercisable during the full term of such options, (iii) all deferred and other amounts previously accrued for the benefit of Executive shall be promptly paid to Executive's estate or designated beneficiary (the items in (i), (ii) and (iii) above are collectively referred to as the "Accrued Benefits"), (iv) Executive and his dependents shall continue to participate in the Company's employee benefit plans to the extent provided in such plans with respect to the death or Permanent Disability of senior executive officers of the Company, (v) Executive's Base Salary shall be paid through the month of death or Permanent Disability and (vi) Executive shall receive a benefit under the Annual Bonus Plan and the LTSMIP prorated for the fiscal year during which Executive died or became Permanently Disabled. 5.2 Termination Without Cause or for Good Reason. If the Company terminates the employment of Executive without Cause, or if Executive voluntarily terminates employment with Good Reason, (i) Executive shall receive all Accrued Benefits, (ii) Executive and his dependents shall continue to participate in the Company's medical and dental programs for a period of 24 months at no cost to Executive, (iii) Executive's Base Salary shall continue for a period of 24 months following such termination, and (iv) in the event of a termination for Good Reason on account of a Change of Control, Executive shall receive the benefits described in the Conditional Employment Agreement of even date herewith (reduced to the extent the Base Salary benefit in (iii) above is duplicative of a similar benefit under such Conditional Employment Agreement). 5.3 Termination With Cause or Without Good Reason. If the Company terminates the employment of Executive with Cause, or if Executive voluntarily terminates employment with the Company without Good Reason, then (i) Executive shall be paid the Base Salary through the month of termination, and (ii) Executive shall receive benefits, if any, under Company plans in accordance with the terms of such plans. 5.4 Timing of Payments. All cash payments required hereunder following the termination of Executive's employment shall be made within fifteen days following such termination; provided, that cash payments under the Annual Bonus Plan or the LTSMIP shall be made following the end of the applicable fiscal year at the same time as such payments are made to the Company's other senior executive officers participating in such plans. 6. Nondisclosure of Confidential Information. Executive shall not, without the prior written consent of the Company, disclose any Company Confidential Information except (i) in the business of and for the benefit of the Company, while employed by the Company, or (ii) when required to do so by a court of competent jurisdiction, by any administrative body or legislative body. "Confidential Information" shall mean non-public information concerning the Company's financial data, strategic business plans, product development and other proprietary information, except for items which have become publicly available information or are otherwise known to the public. Confidential Information does not include information the disclosure of which could not reasonably be expected to adversely affect the business of the Company. 7. Noncompetition. From the Effective Date through a period ending two years following the termination of the employment of Executive with the Company for any reason, Executive shall not be an executive officer, board member, 5% or greater owner or partner, or employee of a food company with revenues over $1 billion. Executive agrees that any breach of the covenants contained in this Section 7, and the covenants contained in the preceding Section 6, will irreparably injure the Company, and accordingly the Company may, in addition to pursing any other remedies available at law or in equity, obtain an injunction against Executive from any court having jurisdiction over the matter, restraining any further violation of such provisions by Executive. Executive acknowledges and agrees that the provisions of this Section 7 are reasonable and valid in duration and scope and in all other respects. If any court determines that any provision of this Section is unenforceable because of duration or scope of such provision, such court shall have the power to reduce the scope or duration of such provision, as the case may be, and, in its reduced form, such provision shall then be enforceable. 8. Offsets. In the event of any breach of this Agreement, Executive shall not be required to mitigate damages nor shall the payments due Executive hereunder be reduced or offset by reason of any payments Executive may receive from any other source. 9. Separability; Legal Fees. If any provision of this Agreement shall be declared to be invalid or unenforceable, in whole or in part, such invalidity or unenforceability shall not affect the remaining provisions hereof which shall remain in full force and effect. In addition, the Company shall pay to Executive as incurred all legal and accounting fees and expenses incurred by Executive in seeking to obtain or enforce any right or benefit provided by this Agreement or any other compensation- related plan, agreement or arrangement of the Company, unless Executive's claim is found by a court of competent jurisdiction to have been frivolous. 10. Assignment. This Agreement shall be binding upon and inure to the benefit of the heirs and representatives of Executive and the assigns and successors of the Company, but neither this Agreement nor any rights hereunder shall be assignable or otherwise subject to hypothecation by Executive (except by will or by operation of the laws of intestate succession) or the Company, except that the Company may assign this Agreement to any successor (whether by merger, purchase or otherwise) to all or substantially of the stock, assets or businesses of the Company. 11. Amendment. This Agreement may only be amended by mutual written agreement between the Company and Executive. 12. Notices. All notices or communications hereunder shall be in writing, addressed as follows: To the Company: ConAgra, Inc. One ConAgra Drive Omaha, Nebraska 68102 Attn: Secretary To Executive: Bruce Rohde 843 South 96th Street Omaha, Nebraska 68114 Any such notice or communication shall be sent certified or registered mail, return receipt requested, postage prepaid, addressed as above (or to such other address as such party may designate in a notice duly delivered as described above), and the actual date of mailing shall determine the date at which notice was given. 13. Governing Law. This Agreement shall be construed, interpreted and governed in accordance with the laws of Delaware without reference to such state's rules relating to conflicts of law. CONAGRA, INC. By: /s/ Philip B. Fletcher ____________________________ Chairman, Board of Directors /s/ Bruce Rohde ________________________________ Bruce Rohde AGREEMENT Agreement made effective this 26th day of August, 1996, by and between ConAgra, Inc., a Delaware corporation, hereinafter referred to as "ConAgra", and BRUCE ROHDE, hereinafter referred to as "Employee". WHEREAS, the Board of Directors of ConAgra has determined that the interests of ConAgra stockholders will be best served by assuring that all key corporate executives of ConAgra will adhere to the policy of the Board of Directors with respect to any event by which another entity would acquire effective control of ConAgra, including but not limited to a tender offer, and WHEREAS, the Board of Directors has also determined that it is in the best interests of ConAgra stockholders to promote stability among key executives and employees. NOW, THEREFORE, it is agreed as follows: 1. Duties of Employee. Employee shall support the position of the Board of Directors and the chief executive officer, and shall take any action requested by the Board of Directors or the chief executive officer with respect to any "Change of Control" (as defined at Section 7 below) of ConAgra. If the Employee violates the provisions of this Section, he shall forfeit any payments due to him under the terms of this Agreement. 2. Employment Contract. If a Change of Control of ConAgra occurs, and if at the initiation of the Change of Control attempt Employee is then employed by ConAgra, ConAgra hereby agrees to continue the employment of Employee for a period of three years from the date the Change of Control effectively occurs. During said three year period, Employee shall receive annual base and incentive compensation in an amount not less than that specified in Section 3(a) below. If Employee is Involuntarily Terminated (as defined at Section 7 below), at any time during the three year period, ConAgra shall pay to Employee an amount equal to that which Employee would have received pursuant to Section 3(a) below for the remainder of the three year period, and shall also make the payments specified in Sections 3(b) and 3(c) and, if applicable, any additional payments specified in Section 5 below. In addition, in the event of Involuntary Termination at any time, Employee shall receive payment of the base and incentive compensation described in Section 3(a) for one year. Any such termination payment of base and incentive compensation shall be made to Employee in a lump sum within thirty (30) days after termination. If Employee voluntarily terminates his employment at any time during the three year period, the Acquiror (as defined below), ConAgra, and their subsidiaries will not be obligated to pay the Employee any amount that might be due for the remainder of the three year period, or for any termination pay; however, they shall make any additional payments specified in Sections 3(b), 3(c) and 5 (if applicable) below. 3. Description of Payments. The payments to be made to Employee are: (a) Annual Base and Incentive Compensation. Employee shall receive for the three year period described in Section 2 above an annual amount equal to his current annual rate of compensation, which current annual compensation shall be computed as follows: twenty-six times the Employee's highest bi-weekly salary payment received during the one year period ending immediately prior to the Change of Control of ConAgra. In addition, Employee shall receive for the three year period described in Section 2 above (i) an amount of annual short-term incentive equal to 80% of the annual rate of compensation described above, and (ii) an amount equal to the highest annual long-term compensation award made to Employee during the three fiscal years immediately preceding such Change of Control (provided, for fiscal year 1997, such amount shall be equal to the per unit payout for fiscal 1996 under the ConAgra's Long-Term Senior Management Incentive Plan multiplied by the number of units allocated to Employee for fiscal 1997). (b) Retirement Benefits. Employee shall receive an amount equal to that which he would have received as retirement benefits under the provisions of the ConAgra Pension Plan for Salaried Employees ("Qualified Pension Plan") and the ConAgra Retirement Income Savings Plan ("CRISP") in effect immediately prior to the Change of Control of ConAgra, had Employee continued his employment until age 65 at the current annual rate of base and short term incentive compensation as determined above. (i) The supplemental pension benefit hereunder shall be equal to the result of subtracting (x) the benefit the Employee will receive under the Qualified Pension Plan from (y) the pension benefit the Employee would obtain under the Qualified Pension Plan if the Employee remained in the employ of ConAgra until the Employee attained age 65. The supplemental pension benefit is to be computed assuming the Employee is to receive an unreduced normal retirement pension benefit payable beginning at the later of the date the Employee attains age 60 or the date of the Employee's termination of employment. If the Employee begins to receive his supplemental pension benefit at a time other than as described in the preceding sentence, an actuarial adjustment shall be made to reflect such event. (ii) The supplemental CRISP benefit shall be equal to the amount computed, as follows: A. The additional years of service that the Employee would receive if his or her employment was not terminated prior to attaining age 65 is multiplied by the Employee's current annual base and short term incentive compensation (as described in Section 3(a)). B. The result in A, immediately above, is multiplied by 3%. C. The result in B, immediately above, is present valued to the date of the Employee's termination of employment. The discount factor for such present value shall be the discount factor used by the Qualified Pension Plan at the time of such termination of employment. The present value shall be computed based on the assumption that the result in B, immediately above, is paid ratably (and monthly) over the additional years of service of the Employee. D. The present value amount determined pursuant to C, immediately above, shall be funded pursuant to Subsection (iv) of this Section 3(b). (iii) The actuarial assumptions and methods used by this Section 3(b) shall be the same as those used by the Qualified Pension Plan. The timing of payment and the form of the supplemental pension benefit under this Section 3(b) shall be the same as elected by the Employee under the Qualified Pension Plan and the timing of payment and the form of the supplemental CRISP benefit shall be the same as elected by the Employee under CRISP; (iv) The supplemental pension and CRISP benefits payable under this Section 3(b) shall be unfunded until a voluntary termination or Involuntary Termination following a Change of Control. Within 60 days following such a termination, the supplemental pension and CRISP benefits shall be funded, in one lump sum payment, through a trust in the form attached to the ConAgra Supplemental Pension and CRISP Plan for Change of Control and which trust is incorporated by reference. The transferred amount for the supplemental CRISP benefit shall be held in a separate account and separately invested by the trustee. The amount accumulated in such account shall be the sole source of payment of the supplemental CRISP benefit, and shall be the amount of the supplemental CRISP benefit hereunder. The Acquiror, ConAgra and their subsidiaries shall make up any supplemental pension benefit payments the Employee does not receive under the trust, e.g., if the funds in the trust are insufficient to make the payments due to insufficient earnings in the trust. The trustee of such trust shall be a national or state chartered bank. If funding of the trust is not made within the sixty day period described in this Subsection (iv) of this Section 3(b), the Employee's supplemental pension and CRISP benefits 3(b), the Employee's supplemental pension and CRISP benefits shall then be equal to the product of 150% multiplied by the amount of supplemental pension and CRISP benefits described in this Section 3(b) above; provided, however, this increase in benefits is not intended to remove or detract from the obligation to fund the trust. The supplemental pension and CRISP benefits shall not be paid from the assets of the Qualified Pension Plan or CRISP. (c) Additional Payment. If a Change of Control of ConAgra occurs, Employee shall receive an amount equal to the excess, if any, of the highest per share price offered (valued in U.S. currency) by the successful Acquiror for ConAgra common stock (which stock will then be treated for purposes of this Agreement as converted into equivalent shares of such Acquiror's or the surviving company's capital stock as of the date of the Change of Control of ConAgra) over the closing per share price of such Acquiror's or the surviving company's ("Acquiror") stock quoted on an established securities market (or if applicable, the closing bid price for the Acquiror's stock that is quoted on a secondary market or substantial equivalent thereof) on the date of termination (or if the date of termination is not a business day, on the next preceding business day), multiplied by the highest number of shares of the Acquiror's capital stock owned by the Employee at any time during the period beginning on the date of the Change of Control of ConAgra and ending on the date of termination. For purposes of this Section 3(c), the additional amount due hereunder shall be computed as if Employee owned all of the Acquiror's stock with respect to which Employee has an option to purchase in connection with his employment with the Acquiror, ConAgra or any of their subsidiaries. Said amount shall be paid to Employee within ten days after termination. In addition, if Employee sells any of the Acquiror's stock within one year following said termination, Employee shall receive the amount by which the closing price of such stock per share on the date of termination (determined as aforesaid) exceeds the per share actual net sales price of the Acquiror's stock on the date of sale realized by Employee, multiplied by the number of shares sold by Employee. Said amount shall be paid in immediately available funds to Employee within ten days after the sale. In addition, to the extent any of ConAgra's common stock remains outstanding after a Change of Control, then Employee shall receive additional amounts computed and payable in a manner similar to that provided in this Section 3(c) for Acquiror's stock owned, or subject to an option held, by Employee. These provisions shall be appropriately modified or adjusted to take into account the fact that the computations pursuant to the preceding sentence are with respect to ConAgra common stock and related options rather than the Acquiror's capital stock and options related thereto. The computations and payments under this Section 3(c) shall include appropriate adjustments for any stock splits, stock dividends, recapitalizations or similar share restructurings that may occur from time to time. 4. Merger. ConAgra shall not merge, reorganize, consolidate or sell all or substantially all of its assets, to or with any other corporation until such corporation and its subsidiaries, if any, expressly assume the duties of ConAgra set forth herein. 5. Certain Additional Payments by ConAgra. (a) Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment or distribution by ConAgra to or for the benefit of the Employee, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (a "Payment"), would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code") or any interest or penalties with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the "Excise Tax"), then the Employee shall be entitled to receive an additional payment (a "Gross-Up Payment") in any amount such that after payment by the Employee of all taxes (including any interest or penalties imposed with respect to such taxes), including any Excise Tax, imposed upon the Gross-Up Payment, the Employee retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. (b) Subject to the provisions of Subsection (c) below, all determinations required to be made under this Section, including whether a Gross-Up Payment is required and the amount of such Gross-Up Payment, shall be made by the certified public accounting firm then representing ConAgra (the "Accounting Firm") which shall provide detailed supporting calculations both to ConAgra and the Employee within 15 business days of the date of termination, if applicable, or such earlier time as is requested by ConAgra or Employee. If the Accounting Firm determines that no Excise Tax is payable by the Employee, it shall furnish the Employee with an opinion that he has substantial authority not to report any Excise Tax on his federal income tax return. Any determination by the Accounting Firm shall be binding upon ConAgra and the Employee. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by ConAgra should have been made ("Underpayment"), consistent with the calculations required to be made hereunder. In the event that ConAgra exhausts its remedies pursuant to Subsection (c) below and the Employee thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by ConAgra to or for the benefit of the Employee. (c) The Employee shall notify ConAgra in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by ConAgra of the Gross-Up Payment. Such notification shall be given as soon as practicable but no later than ten (10) business days after the Employee knows of such claim and shall apprise ConAgra of the nature of such claim and the date on which such claim is requested to be paid. The Employee shall not pay such claim prior to the expiration of the thirty-day (30 day) period following the date on which it gives such notice to ConAgra (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If ConAgra notifies the Employee in writing prior to the expiration of such period that it desires to contest such claim, the Employee shall: (i) give ConAgra any information reasonably requested by ConAgra relating to such claim, (ii) take such action in connection with contesting such claim as ConAgra shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney reasonably selected by ConAgra, (iii) cooperate with ConAgra in good faith in order to effectively contest such claim, (iv) permit ConAgra to participate in any proceedings relating to such claim; provided, however, that ConAgra shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such contest and shall indemnify and hold the Employee harmless, on an after-tax basis, for any Excise Tax or income tax, including interest and penalties with respect thereto, imposed as a result of such representation and payment of costs and expenses. Without limitation on the foregoing provisions of this Subsection (c), ConAgra shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forego any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct the Employee to pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and the Employee agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as ConAgra shall determine; provided, however, that if ConAgra directs the Employee to pay such claim and sue for a refund, ConAgra shall advance the amount of such payment to the Employee, on an interest-free basis and shall indemnify and hold the Employee harmless, on an after-tax basis, from any Excise Tax or income tax, including interest or penalties with respect thereto, imposed with respect to such advance or with respect to any imputed income with respect to such advance; and further provided that any extension of the statute of limitations relating to payment of taxes for the taxable year of the Employee with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, ConAgra's control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and the Employee shall be entitled to settle or contest, as the case may be, any other issue raised by the Internal Revenue Service or any other taxing authority. (d) If, after the receipt by the Employee of an amount advanced by ConAgra pursuant to Subsection (c) above, the Employee becomes entitled to receive any refund with respect to such claim, the Employee shall (subject to ConAgra's complying with the requirements of Subsection (c)) promptly pay to ConAgra the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by the Employee of an amount advanced by ConAgra pursuant to Subsection (c), a determination is made that the Employee shall not be entitled to any refund with respect to such claim and ConAgra does not notify the Employee in writing of its intent to contest such denial of refund prior to the expiration of thirty days after such determination, then such advance shall be forgiven and shall not be required to be repaid and the amount of such advance shall offset, to the extent thereof, the amount of Gross-Up Payment required to be paid. 6. Term and Binding Effect. This Agreement shall bind ConAgra and Employee as long as Employee remains in the employ of ConAgra; provided, however, ConAgra may terminate this Agreement at any time by giving notice to Employee; and provided further, however, that ConAgra may not terminate this Agreement at any time subsequent to the announcement of an event that could result in a Change of Control of ConAgra. This Agreement shall be binding upon the parties hereto, their heirs, executors, administrators and successors. 7. Certain Definitions. The following definitions shall apply for the purposes of this Agreement: (a) Change of Control of ConAgra. The term "Change of Control" shall mean: (i) The acquisition (other than from ConAgra) by any person, entity or "group", within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934 (the "Exchange Act"), (excluding, for this purpose, ConAgra or its subsidiaries, or any employee benefit plan of ConAgra or its subsidiaries, which acquires beneficial ownership of voting securities of ConAgra) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or more of either the then outstanding shares of common stock or the combined voting power of ConAgra's then outstanding voting securities entitled to vote generally in the election of directors; or (ii) 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 election by ConAgra's shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be, for purposes of this Agreement, considered as though such person were a member of the Incumbent Board; or (iii) Approval of the shareholders of ConAgra of a reorganization, merger, consolidation, in each case, with respect to which persons who were the shareholders of ConAgra 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 ConAgra or of the sale of all or substantially all of its assets. (b) Involuntary Termination. The term "Involuntary Termination" or any variation thereof shall mean either (i) the actual involuntary termination of Employee's employment with the Acquiror, ConAgra and their subsidiaries after a Change of Control (with or without cause) or (ii) the constructive involuntary termination of the Employee's employment with the Acquiror, ConAgra and their subsidiaries after a Change of Control. The term "constructive involuntary termination" shall include (w) a reduction in the Employee's compensation (including applicable fringe benefits); (x) a substantial change in the location of the Employee's job without the Employee's written consent; (y) the Employee's demotion or diminution in the Employee's position, authority, duties or responsibilities without the Employee's written consent; or (z) the sale or disposition of the stock of Employee's immediate employer, which was a subsidiary of the Acquiror, ConAgra, or their other subsidiaries immediately prior to such sale or disposition, provided Employee is not employed after such sale or disposition by the Acquiror, ConAgra, or any of their subsidiaries that are retained after such sale or disposition. "Substantial change in location" means any location change in excess of 35 miles from the location of the Employee's job with ConAgra or its subsidiaries at the time of the Change of Control of ConAgra. 8. Costs. All costs of litigation necessary for the Employee to defend the validity of this contract are to be paid by ConAgra or its successors or assigns. IN WITNESS WHEREOF, the parties have executed this Agreement. EMPLOYEE: CONAGRA, INC. /s/ Bruce Rohde /s/ Philip B. Fletcher _______________________ __________________________ BRUCE ROHDE Chairman, Board of Directors EX-10 3 SECOND AMENDMENT TO THE CONAGRA, INC. DIRECTORS' UNFUNDED DEFERRED COMPENSATION PLAN The ConAgra, Inc. Directors' Unfunded Deferred Compensation Plan, is amended, as follows: ARTICLE I Paragraph 4 is amended in its entirety to read, as follows: "4. Amounts deferred under the Plan together with accumulated interest, including interest accruing after the participant ceases to be a director, shall be distributed in twenty semiannual installments on January 1st and July 1st of each year after the year in which the participant in the Plan ceases to be a director, provided that if the participant dies prior to payment in full of all amounts due him under the Plan, the balance of the account shall be payable to his designated beneficiary. The beneficiary designation shall be revocable and shall be made in writing in a manner provided by ConAgra. In addition, after a participant ceases to be a director, upon his request, the Executive Committee of the Board at their sole discretion may authorize a different method of payment including a lump sum payment. If for any reason the Executive Committee of the Board determines it to be in the best interests of ConAgra or the participant to pay the participant in full including a determination that the participant upon termination becomes a proprietor, officer, partner, employee or otherwise becomes affiliated with any business that is in competition with ConAgra, ConAgra may make a payment in full to said participant when he ceases to be a director without his consent. Payment of the aggregate number of shares credited by book entry to a director's Stock Account shall be made in shares of Common Stock." February 14, 1997 EX-12 4 EXHIBIT 12 CONAGRA, INC. AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES ($ IN MILLIONS) Nine Months Ended February 23, 1997 ____________ Fixed charges: Interest expense $ 254.3 Capitalized interest 6.8 Interest in cost of goods sold 14.8 One third of non-cancellable lease rent 28.3 ------------ Total fixed charges (A) $ 304.2 ============ Earnings: Pretax income $ 722.2 Adjustment for unconsolidated subidiaries (0.4) ------------ Pretax income of the Company as a whole 721.8 Add fixed charges 304.2 Less capitalized interest (6.8) ------------ Earnings and fixed charges (B) $ 1,019.2 ============ Ratio of earnings to fixed charges (B/A) 3.4 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. EX-27 5
5 1000 9-MOS MAY-25-1997 FEB-23-1997 64500 0 2128400 75400 3692000 6243600 5321200 2243200 12177600 5987700 2333500 0 525000 1265300 1154600 12177600 18803800 18803800 16176100 16176100 1689400 0 216100 722200 293700 428500 0 0 0 428500 1.87 0
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