10-Q 1 g68763e10-q.txt LANCE INC 1 -------------------------------------------------------------------------------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q Quarterly Report Filed Pursuant to Section 13 or 15(d) Of the Securities Exchange Act of 1934 FOR THE QUARTERLY (THIRTEEN WEEK) PERIOD ENDED COMMISSION FILE NUMBER 0-398 MARCH 31, 2001 LANCE, INC. (Exact name of registrant as specified in its charter) North Carolina 56-0292920 (State or other jurisdiction of (I.R.S. Employer Identification No.) Incorporation or organization) 8600 South Boulevard P.O. Box 32368 Charlotte, North Carolina 28232 (Address of principal executive offices) (Zip Code) 704-554-1421 (Registrant's telephone number, including area code) 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 ------- ------- The number of shares outstanding of the Registrant's $0.83-1/3 par value Common Stock, its only outstanding class of Common Stock, as of April 26, 2001, was 28,982,174 shares. -------------------------------------------------------------------------------- 2 LANCE, INC. AND SUBSIDIARIES INDEX
Page PART I. FINANCIAL INFORMATION ---- Item 1. Financial Statements Condensed Consolidated Balance Sheets - March 31, 2001 (Unaudited) and December 30, 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Condensed Consolidated Statements of Income (Unaudited) - Thirteen Weeks Ended March 31, 2001 and March 25, 2000 . . . . . . . . . . . . . . . . 4 Condensed Consolidated Statements of Stockholders' Equity and Comprehensive Income (Unaudited) - Thirteen Weeks Ended March 31, 2001 and March 25, 2000 . . . . . . . . . . . . . . . . . . . . . . . . . 5 Condensed Consolidated Statements of Cash Flows (Unaudited) - Thirteen Weeks Ended March 31, 2001 and March 25, 2000 . . . . . . . . .. . . . . . . 6 Notes to Condensed Consolidated Financial Statements . . . . . . . . . . . . . . . 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Item 3. Quantitative and Qualitative Disclosures about Market Risk . . . . . . . . . 12 PART II. OTHER INFORMATION Item 2. Changes in Securities and Use of Proceeds . . . . . . . . . . . . . . . . . . 12 Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . . . . . . . . 13 SIGNATURES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2 3 LANCE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS AS OF MARCH 31, 2001 (UNAUDITED) AND DECEMBER 30, 2000 (In thousands, except share data)
March 31, December 30, 2001 2000 --------- --------- ASSETS CURRENT ASSETS Cash and cash equivalents $ 3,277 $ 1,224 Accounts receivable (less allowance for doubtful accounts) 53,204 47,188 Inventories 24,748 23,205 Deferred income tax benefit 5,024 4,161 Prepaid income taxes -- 1,120 Prepaid expenses and other 3,835 5,430 --------- --------- Total current assets 90,088 82,328 Property, plant & equipment, net 181,571 179,283 Goodwill, net 40,346 42,069 Other intangible assets, net 9,931 10,177 Other assets 3,171 3,216 --------- --------- TOTAL ASSETS $ 325,107 $ 317,073 ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Current portion of long-term debt $ 354 $ 395 Accounts payable 17,959 14,718 Accrued income taxes 3,319 -- Accrued liabilities 24,508 24,283 --------- --------- Total current liabilities 46,140 39,396 --------- --------- OTHER LIABILITIES AND DEFERRED CREDITS Long-term debt 65,593 63,536 Deferred income taxes 20,895 21,548 Accrued postretirement health care costs 11,118 11,317 Accrual for insurance claims 4,017 4,083 Supplemental retirement benefits 2,557 2,600 --------- --------- Total other liabilities and deferred credits 104,180 103,084 --------- --------- STOCKHOLDERS' EQUITY Common stock, $0.83 1/3 par value (authorized: 75,000,000 shares; 28,982,172 and 28,947,222 shares outstanding at March 31, 2001 and December 30, 2000) 24,152 24,123 Preferred stock, $1.00 par value (authorized: 5,000,000 shares; 0 shares outstanding at March 31, 2001 and December 30, 2000) -- -- Additional paid-in capital 1,578 1,229 Unamortized portion of restricted stock awards (786) (437) Retained earnings 150,267 149,794 Accumulated other comprehensive loss (424) (116) --------- --------- Total stockholders' equity 174,787 174,593 --------- --------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 325,107 $ 317,073 ========= =========
See notes to condensed consolidated financial statements (unaudited). 3 4 LANCE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) FOR THE THIRTEEN WEEKS ENDED MARCH 31, 2001 AND MARCH 25, 2000 (In thousands, except share and per share data)
Thirteen Thirteen Weeks Ended Weeks Ended March 31, 2001 March 25, 2000 -------------- -------------- NET SALES AND OTHER OPERATING REVENUE $ 145,410 $ 135,630 ------------ ------------ COST OF SALES AND OPERATING EXPENSES Cost of sales 71,391 64,015 Selling, marketing and delivery 55,558 54,927 General and administrative 7,674 6,071 Provisions for employees' retirement plans 1,036 1,172 Amortization of goodwill and other intangibles 512 467 ------------ ------------ Total costs and expenses 136,171 126,652 ------------ ------------ OPERATING PROFIT 9,239 8,978 Interest income (expense), net (1,092) (1,125) Other income, net 45 1,319 ------------ ------------ INCOME BEFORE INCOME TAXES 8,192 9,172 Income taxes 3,083 3,428 ------------ ------------ NET INCOME $ 5,109 $ 5,744 ============ ============ EARNINGS PER SHARE Basic $ 0.18 $ 0.20 Diluted $ 0.18 $ 0.20 Weighted average shares outstanding - basic 28,901,000 29,173,000 Weighted average shares outstanding - diluted 29,029,000 29,197,000 CASH DIVIDENDS PER SHARE $ 0.16 $ 0.16
See notes to condensed consolidated financial statements (unaudited). 4 5 LANCE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME (UNAUDITED) FOR THE THIRTEEN WEEKS ENDED MARCH 31, 2001 AND MARCH 25, 2000 (In thousands, except share data)
Unamortized Portion of Accumulated Additional Restricted Other Common Paid-in Stock Retained Comprehensive Shares Stock Capital Awards Earnings Income Total ---------------------------------------------------------------------------------- BALANCE, DECEMBER 25, 1999 29,950,897 $24,959 $2,552 $(799) $ 154,063 $ 15 $ 180,790 ---------------------------------------------------------------------------------- Comprehensive income: Net income - - - - 5,744 - 5,744 Foreign currency translation adjustment (47) (47) ----------- Total comprehensive income - - - - - - 5,697 ----------- Cash dividends paid to stockholders - - - - (4,666) - (4,666) Cancellations of restricted stock (14,575) (12) (91) 170 - - 67 Purchases of common stock (976,000) (813) (1,139) - (7,718) - (9,670) ---------------------------------------------------------------------------------- BALANCE, MARCH 25, 2000 28,960,322 $24,134 $1,322 $(629) $ 147,423 $ (32) $ 172,218 ================================================================================== BALANCE, DECEMBER 30, 2000 28,947,222 $24,123 $1,229 $(437) $ 149,794 $(116) $ 174,593 ---------------------------------------------------------------------------------- Comprehensive income: Net income - - - - 5,109 - 5,109 Foreign currency translation adjustment - - - - - (308) (308) ----------- Total comprehensive income - - - - - - 4,801 ----------- Cash dividends paid to stockholders - - - - (4,636) - (4,636) Issuance of restricted stock, net of cancellations 34,950 29 349 (349) - - 29 ---------------------------------------------------------------------------------- BALANCE, MARCH 31, 2001 28,982,172 $24,152 $1,578 $(786) $ 150,267 $(424) $ 174,787 ==================================================================================
See notes to condensed consolidated financial statements (unaudited). 5 6 LANCE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) FOR THE THIRTEEN WEEKS ENDED MARCH 31, 2001 AND MARCH 25, 2000 (In thousands)
Thirteen Weeks Thirteen Weeks Ended Ended March 31, 2001 March 25, 2000 -------------- -------------- OPERATING ACTIVITIES Net income $ 5,109 $ 5,744 Adjustments to reconcile net income to cash provided by operating activities: Depreciation and amortization 7,543 7,262 Loss (gain) on sale of property, net 28 (1,337) Deferred income taxes (1,403) (249) Changes in operating assets and liabilities 1,734 (3,682) -------- -------- Net cash flow provided by operating activities 13,011 7,738 -------- -------- INVESTING ACTIVITIES Purchases of property and equipment (10,476) (2,821) Proceeds from sale of property and equipment 320 2,062 -------- -------- Net cash used in investing activities (10,156) (759) -------- -------- FINANCING ACTIVITIES Dividends paid (4,636) (4,666) Issuance (purchase) of common stock, net 29 (9,670) Repayments of debt (133) (92) Borrowings (repayments) under revolving credit facilities, net 4,011 (3,000) -------- -------- Net cash used in financing activities (729) (17,428) -------- -------- Effect of exchange rate changes on cash (73) (47) -------- -------- INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 2,053 (10,496) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 1,224 13,303 -------- -------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 3,277 $ 2,807 ======== ======== SUPPLEMENTAL INFORMATION Cash paid for income taxes $ 75 $ 276 Cash paid for interest $ 176 $ 444
See notes to condensed consolidated financial statements (unaudited). 6 7 LANCE, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 1. The accompanying unaudited consolidated financial statements of Lance, Inc. (the "Company") have been prepared in accordance with generally accepted accounting principles for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of the Company, these financial statements reflect all adjustments (consisting of only normal, recurring accruals) necessary to present fairly the consolidated financial position of the Company and its subsidiaries as of March 31, 2001 and December 30, 2000, and the consolidated statements of income for the thirteen weeks ended March 31, 2001 and March 25, 2000 and the statements of stockholders' equity and comprehensive income and cash flows for the thirteen weeks ended March 31, 2001 and March 25, 2000. 2. The consolidated results of operations for the thirteen weeks ended March 31, 2001 are not necessarily indicative of the results to be expected for a full year. 3. The Company's primary raw materials include peanuts, peanut butter, flour, sugar, potatoes and other grain products. 4. The Company utilizes the dollar value last-in, first-out (LIFO) method of determining the cost of the majority of its inventories. Because inventory calculations under the LIFO method are based on annual determinations, the determination of interim LIFO valuations requires that estimates be made of year-end costs and levels of inventories. The possibility of variation between estimated year-end costs and levels of LIFO inventories and the actual year-end amounts may materially affect the results of operations as finally determined for the full year. Inventories consist of (in thousands):
March 31, December 30, 2001 2000 -------- -------- Finished goods $ 16,287 $ 14,869 Raw materials 6,163 5,386 Supplies, etc 7,104 7,720 -------- -------- Total inventories at FIFO cost 29,554 27,975 Less: Adjustments to reduce FIFO cost to LIFO cost (4,806) (4,770) -------- -------- Total inventories $ 24,748 $ 23,205 ======== ========
7 8 LANCE, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 5. The following table provides a reconciliation of the denominator used in computing basic earnings per share to the denominator used in computing diluted earnings per share for the thirteen weeks ended March 31, 2001 and the thirteen weeks ended March 25, 2000 (there were no reconciling items for the numerator amounts of basic and diluted earnings per share):
March 31, 2001 March 25, 2000 -------------- -------------- Weighted average number of common shares used in computing basic earnings per share 28,901,000 29,173,000 Effect of dilutive stock options and non-vested restricted stock 128,000 24,000 ---------- ---------- Weighted average number of common shares and dilutive potential common stock used in computing diluted earnings per share 29,029,000 29,197,000 ========== ========== Stock options excluded from the above reconciliation because they are anti-dilutive 2,004,000 1,183,000 ========== ==========
6. During the thirteen weeks ended March 31, 2001 and March 25, 2000, other comprehensive income consisted of a $308,000 and $47,000 loss, respectively, related to the translation of the financial statements of foreign subsidiaries. 7. For the fiscal year 2001 the Company implemented SFAS 133, Accounting for Derivative Instruments and Hedging Activities. SFAS No. 133 establishes accounting and reporting standards requiring that every derivative instrument be recorded in the balance sheet as either an asset or a liability measured at its fair value. It also requires that changes in the derivative's fair value be recognized currently in earnings unless specific hedge accounting criteria are met, and requires that a company must formally document, designate and assess the effectiveness of transactions that receive hedge accounting. At March 31, 2001, the Company has a limited amount of hedging transactions. The impact of these transactions resulted in an immaterial impact to the financial statements. 8 9 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS THIRTEEN WEEKS ENDED MARCH 31, 2001 COMPARED TO THIRTEEN WEEKS ENDED MARCH 25, 2000
Thirteen weeks ended March 31, March 25, ($ In Thousands) 2001 2000 Difference ------------------------------------------------------------------------------------------------------------------------- Revenues $145,410 100.0% $135,630 100.0% $9,780 7.2% Cost of sales 71,391 49.1% 64,015 47.2% (7,376) (11.5%) ------------------------------------------------------------------------------------------------------------------------- Gross margin 74,019 50.9% 71,615 52.8% (2,404) (3.4%) ------------------------------------------------------------------------------------------------------------------------- Selling, marketing, and delivery expenses 55,558 38.2% 54,927 40.5% (631) (1.1%) General and administrative expenses 7,674 5.3% 6,071 4.5% (1,603) (26.4%) Provision for employees' retirement plans 1,036 0.7% 1,172 0.9% 136 11.6% Amortization of goodwill and intangibles 512 0.3% 467 0.3% (45) (9.6%) ------------------------------------------------------------------------------------------------------------------------- Total operating expenses 64,780 44.5% 62,637 46.2% (2,143) (3.4%) ------------------------------------------------------------------------------------------------------------------------- Operating profit 9,239 6.4% 8,978 6.6% 261 2.9% Other income, net 45 0.0% 1,319 0.9% (1,274) (96.6%) Interest income (expense), net (1,092) (0.8%) (1,125) (0.8)% 33 2.9% Income taxes 3,083 2.1% 3,428 2.5% 345 10.1% ------------------------------------------------------------------------------------------------------------------------- Net income $5,109 3.5% $5,744 4.2% $ (635) (11.1%) =========================================================================================================================
Revenues increased $9.8 million or 7.2% due to continued growth in contract manufactured and private label sales as well as revenue growth in the Company's branded products. Gross margin as a percent of revenues decreased from 52.8% in 2000 to 50.9% in 2001 predominately as a result of changes in the mix of products sold. Selling, marketing and delivery expenses as a percent of sales decreased from 40.5% in 2000 to 38.2% in 2001 due to higher levels of direct shipments and the absence of severance expenses recorded in 2000. However, total expenses increased $0.6 million primarily as a result of additional trade allowance expenditures and additional transportation and distribution related expenses. General and administrative expenses increased $1.6 million primarily as a result of increased incentive, bad debt and relocation expenses. The provision for employees' retirement plan was lower than prior year due to the profitability-based formula for these contributions. Other income primarily includes gains and losses on dispositions of fixed assets. The $1.3 million decrease in other income was due to a significant gain on the disposition of assets that occurred in 2000. Net interest expense was comparable to the prior year. The effective income tax rate increased to 37.6% compared to 37.4%. 9 10 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS LIQUIDITY AND CAPITAL RESOURCES In 2000, the Company amended its unsecured revolving credit agreement, first entered into in 1999, giving the Company the ability to borrow up to $60 million and Cdn $25 million through April 2004. At March 31, 2001, $25.5 million was outstanding on these unsecured revolving credit facilities. Borrowing and repayments under these revolving credit facilities are similar in nature to short-term credit lines; however, due to the nature and terms of the agreements allowing repayment through April 2004, all borrowings under these facilities are classified as long-term debt. Cash flow from operations for the thirteen weeks ended March 31, 2001 totaled $13.0 million. Working capital (other than cash and marketable securities) decreased to $40.7 million at March 31, 2001 from $41.7 million at March 25, 2000 due to an increase in various current liabilities offset by an increase in accounts receivable and other timing differences in the various components of working capital. Cash used in investing activities for the thirteen weeks ended March 31, 2001 totaled $10.2 million. Capital expenditures totaled $10.5 million with the largest expenditures being plant equipment. Proceeds from the sale of property and equipment totaled $0.3 million. Cash used in financing activities for the thirteen weeks ended March 31, 2001 totaled $0.7 million. Cash dividends of $0.16 per share for the thirteen weeks ended March 31, 2001 amounted to $4.6 million. During the first quarter of 2000 the Company repurchased 976,000 shares for $9.6 million. On January 30, 2001, the Board of Directors authorized the repurchase of 1.0 million shares of its common stock. During the first quarter of 2001 the Company did not repurchase any shares of its common stock and currently has no active program to repurchase shares of its common stock. As of March 31, 2001, cash and cash equivalents totaled $3.3 million and total debt outstanding was $65.9 million as compared to $1.2 million in cash and $63.9 million in debt as of December 30, 2000. Additional borrowings available under all credit facilities totaled $48.8 million. The Company has complied with all financial covenants contained in the financing agreements. Available cash, cash from operations and available credit under the credit facilities are expected to be sufficient to meet cash dividend and normal operating requirements for the foreseeable future. MARKET RISK The principal market risks to which the Company is exposed that may adversely impact results of operations and financial position are changes in certain raw material prices, interest rates and fluctuations in foreign exchange rates. The Company has no market risk sensitive instruments held for trading purposes. Raw materials used by the Company are exposed to the impact of changing commodity prices. Accordingly, the Company historically has entered into commodity futures and option contracts to manage fluctuations in prices of anticipated purchases of certain raw materials. The Company's Board-approved policy is to use such commodity derivative financial instruments only to the extent necessary to manage these exposures. The Company does not use these financial instruments for trading purposes. At March 31, 2001, the Company had no open positions on futures contracts. The Company's long-term debt obligations incur interest at floating rates, based on changes in U.S. Dollar LIBOR, Canadian Dollar LIBOR and prime rate interest. Therefore, the Company has an exposure to changes in these interest rates. In 1999, the Board of Directors authorized interest rate exchange agreements to more effectively manage the effects of changing interest rates. However, no such agreements have been entered into. At March 31, 2001, the Company's long term debt totaled $65.9 million, with interest rates ranging from 5.4% to 6.9%, with a weighted average interest rate of 6.3%. A 10 11 10% increase in U.S. LIBOR and Canadian LIBOR would have increased interest expense for the thirteen weeks ended March 31, 2001 by $0.1 million. Through the operations of Tamming Foods Ltd. ("Tamming"), a subsidiary of the Company, the Company has an exposure to foreign exchange rate fluctuations, primarily between the U.S. and Canadian dollars. Foreign exchange rate fluctuations have limited impact on the earnings of the Company as a majority of the sales of Tamming are denominated in U.S. dollars. The indebtedness used to finance the acquisition of Tamming is denominated in Canadian dollars and serves as an effective hedge of the net asset investment in Tamming. A 10% devaluation of the Canadian dollar would result in an immaterial change in the Company's net asset investment in Tamming. FORWARD-LOOKING STATEMENTS This discussion contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those forward-looking statements. Factors that may cause actual results to differ materially include price competition, industry consolidation, raw material costs, effectiveness of sales and marketing activities and operation of a leveraged business, as described in Exhibit 99.1 to this Form 10-Q. 11 12 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The principal market risks to which the Company is exposed that may adversely impact results of operations and financial position include changes in certain raw material prices, interest rates and foreign exchange rates. Quantitative and qualitative disclosures about these market risks are included under "Market Risks" in Item 2 above, Management's Discussion and Analysis of Financial Condition and Results of Operations. PART II. OTHER INFORMATION ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS The Registrant's Amended and Restated Credit Agreement dated May 26, 2000, restricts payment of cash dividends and repurchases of common stock by the Registrant if, after payment of any such dividends or any such repurchases of common stock, the Registrant's consolidated stockholders' equity would be less than $125,000,000. At March 31, 2001, the Registrant's consolidated stockholders' equity was $174,787,000. 12 13 ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits 3.1 Restated Articles of Incorporation of Lance, Inc. as amended through April 17, 1998, incorporated herein by reference to Exhibit 3 to the Registrant's Quarterly Report on Form 10-Q for the twelve weeks ended June 13, 1998. 3.2 Articles of Amendment of Lance, Inc. dated July 14, 1998 designating rights, preferences and privileges of the Registrant's Series A Junior Participating Preferred Stock, incorporated herein by reference to Exhibit 3.2 to the Registrant's Annual Report on Form 10-K for the fiscal year ended December 26, 1998. 3.3 Bylaws of Lance, Inc., as amended through September 1, 2000, incorporated herein by reference to the Registrant's Quarterly Report on Form 10-Q for the thirteen weeks ended September 23, 2000. 10.1 Lance, Inc. 2001 Annual Performance Incentive Plan for Officers 10.2 Lance, Inc. 2001 Long-Term Incentive Plan for Officers 10.3 Lance, Inc. 1997 Incentive Equity Plan, as amended through January 30, 2001. 99.1 Cautionary Statement under Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. (b) Reports on Form 8-K No reports on Form 8-K were filed during the thirteen weeks ended March 31, 2001. Items 1, 3, 4 and 5 are not applicable and have been omitted. 13 14 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused the Report to be signed on its behalf by the undersigned thereunto duly authorized. LANCE, INC. By: /s/ B. Clyde Preslar ----------------------------- B. Clyde Preslar Vice President and Principal Financial Officer Dated: April 27, 2001 14 15 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. EXHIBITS ITEM 6(A) FORM 10-Q QUARTERLY REPORT FOR THE QUARTERLY PERIOD ENDED COMMISSION FILE NUMBER MARCH 31, 2001 0-398 LANCE, INC. EXHIBIT INDEX Exhibit No. Exhibit Description ------- ------------------------ 3.1 Restated Articles of Incorporation of Lance, Inc. as amended through April 17, 1998, incorporated herein by reference to Exhibit 3 to the Registrant's Quarterly Report on Form 10-Q for the twelve weeks ended June 13, 1998. 3.2 Articles of Amendment of Lance, Inc. dated July 14, 1998 designating rights, preferences and privileges of the Registrant's Series A Junior Participating Preferred Stock, incorporated herein by reference to Exhibit 3.2 to the Registrant's Annual Report on Form 10-K for the fiscal year ended December 26, 1998. 3.3 Bylaws of Lance, Inc., as amended through September 1, 2000, incorporated herein by reference to the Registrant's Quarterly Report on Form 10-Q for the thirteen weeks ended September 23, 2000. 10.1 Lance, Inc. 2001 Annual Performance Incentive Plan for Officers 10.2 Lance, Inc. 2001 Long-Term Incentive Plan for Officers 10.3 Lance, Inc. 1997 Incentive Equity Plan, as amended through January 30, 2001. 99.1 Cautionary Statement under Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995.