SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 11-K/A
Annual Report
(Mark One)
[ ] Annual Report pursuant to Section 15(d) of the Securities
Exchange Act of 1934
For the fiscal year ended _______________________________
Or
[X] Transition report pursuant to Section 15(d) of the
Securities Exchange Act of 1934
For the transition period from
April 1, 1996 to June 30, 1996
------------------------------
Commission file number ___________________
A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
THE EARTHGRAINS COMPANY EMPLOYEE STOCK OWNERSHIP/401(K) PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
THE EARTHGRAINS COMPANY
8400 Maryland Avenue
St. Louis, Missouri 63105
REQUIRED INFORMATION
Item 1. The Plan is subject to ERISA. See Item 4.
Item 2. The Plan is subject to ERISA. See Item 4.
Item 3. The Plan is subject to ERISA. See Item 4.
Item 4. Financial Statements and Exhibits.
----------------------------------
(a) Financial Statements:
Audited Statement of Net Assets Available for Benefits at June 30,
1997, June 30, 1996 and March 31, 1996.
Audited Statement of Changes in Net Assets Available for Benefits
for the twelve months ended June 30, 1997, for the three months ended June
30, 1996, and for the twelve months ended March 31, 1996.
Notes to Financial Statements
Line 27a - Schedule of Assets Held for Investment Purposes at June
30, 1997.
Line 27d - Schedule of Reportable Transactions for the twelve
months ended June 30, 1997.
Appendix information has not been provided.
<PAGE>
(b) Exhibits:
Exhibit 23 Consent of Independent Accountants
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act
of 1934, the trustees (or other persons who administer the employee benefit
plan) have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
THE EARTHGRAINS COMPANY EMPLOYEE
STOCK OWNERSHIP/401(K) PLAN
By: EDWARD J. WIZEMAN
-------------------------
Edward J. Wizeman
Administrative Committee Member
Date: December 30, 1997
<PAGE>
THE EARTHGRAINS
COMPANY EMPLOYEE
STOCK OWNERSHIP/
401(K) PLAN
Financial Statements and
Additional Information
June 30, 1997, June 30, 1996
and March 31, 1996
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
OWNERSHIP/401(K) PLAN
Index to Financial Statements and Additional Information
June 30, 1997
- ---------------------------------------------------------------------------
Page
Report of Independent Accountants 1
Financial Statements:
Statements of Net Assets Available for Benefits
with fund Information 2-4
Statements of Changes in Net Assets Available for
Benefits with Fund Information 5-7
Notes to Financial Statements 8-12
Additional Information*:
Line 27a-Schedule of Assets Held for
Investment Purposes, June 30, 1997 Schedule I
Line 27d-Schedule of Reportable Transactions,
12 months Ended June 30, 1997 Schedule II
* Other schedules required by Section 2520.103-10 of Department of Labor
Rules and Regulations for Reporting and Disclosure under ERISA have been
omitted because they are not applicable.
<PAGE>
Price Waterhouse LLP
Report of Indendent Accountants
September 19, 1997
To the Participants and Administrator
of The Earthgrains Company Employee
Stock Ownership/401(k) Plan
In our opinion, the accompanying statements of net assets available for
benefits and the related statements of changes in net assets available for
benefits present fairly, in all material respects, the net assets available
for benefits of The Earthgrains Employee Stock Ownership/401(k) Plan at
June 30, 1997, June 30, 1996 and March 31, 1996, and the changes in net
assets available for benefits for the periods then ended, in conformity
with generally accepted accounting principles. These financial statements
are the responsibility of the plan's management; our responsibility is to
express an opinion on these financial statements based on our audits. We
conducted our audits of these statements in accordance with generally
accepted auditing standards which require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant
estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable
basis for the opinion expressed above.
Our audits were performed for the purpose of forming an opinion on the
basic financial statements taken as a whole. The additional information
included in Schedules I and II is presented for the purpose of additional
analysis and is not a required part of the basic financial statements but
is additional information required by ERISA. The Fund Information in the
statements of net assets available for benefits and the statements of
changes in net assets available for benefits is presented for purposes of
additional analysis rather than to present the net assets available for
benefits and the changes in net assets available for benefits of each fund.
Schedules I and II and the Fund Information have been subjected tot he
auditing procedures applied in the audits of the basic financial statements
and, in our opinion, are fairly stated in all material respects in relation
to the basic financial statements taken as a whole.
PRICE WATERHOUSE LLP
Price Waterhouse LLP
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
OWNERSHIP/401(K) PLAN
Statement of Net Assets Available for Benefits with Fund Information
June 30, 1997
Page 2
- ---------------------------------------------------------------------------
<TABLE>
The Anheuser- Fidelity
Earthgrains Busch Fidelity Fidelity Fidelity U.S. asset
Company Companies money market Intermediate equity index manager
stock fund stock fund trust fund bond fund portfolio fund
<S> <C> <C> <C> <C> <C> <C>
Assets
Receivables:
Contributions:
Participant $ - $ - $ - $ - $ - $ -
Employer 204,557
Other 279,178
Interest 518 196 16 24 114 45
---------- ---------- ---------- ---------- ---------- ----------
205,075 279,374 16 24 114 45
---------- ---------- ---------- ---------- ---------- ----------
Investments, at fair value
The Earthgrains Company Common Stock* 38,345,398
Anheuser-Busch Companies, Inc.
Common Stock* 10,244,638
The Earthgrains Company Fidelity Money
Market Trust Fund 277,279
The Earthgrains Company Fidelity
Intermediate Bond Fund 639,641
The Earthgrains Company Fidelity
U.S. Equity Index Portfolio* 3,346,578
The Earthgrains Company Fidelity Asset
Manager Fund 1,061,911
The Earthgrains Company Fidelity
Contra Fund
Participant loans - - - - - -
---------- ---------- ---------- ---------- ---------- ----------
Total Investments 38,345,398 10,244,638 277,279 639,641 3,346,578 1,061,911
---------- ---------- ---------- ---------- ---------- ----------
Total Assets 38,550,473 10,524,012 277,295 639,665 3,346,692 1,061,956
---------- ---------- --------- ---------- ---------- ----------
Liabilities:
Notes payable 14,446,624
Other payable 204,572 5 1 1 3 -
---------- ---------- ---------- ---------- ---------- ----------
Total Liabilities: 14,651,196 5 1 1 3 -
---------- ---------- ---------- ---------- ---------- ----------
Net Assets available for benefits $23,899,277 $10,524,007 $277,294 $639,664 $3,346,689 $1,061,956
=========== =========== ========== ========== ========== ==========
<FN>
* Represents more than 5% of net assets available for benefits
</FN>
Fidelity Participant
contra loans
fund fund Total
<S> <C> <C> <C>
Assets
Receivables:
Contributions:
Participant $ - $ - $ -
Employer 204,557
Other 279,178
Interest 16 - 929
--------- ---------- ----------
16 - 484,664
--------- ---------- ----------
Investments, at fair value
The Earthgrains Company Common Stock* 38,345,398
Anheuser-Busch Companies, Inc. Common Stock* 10,244,638
The Earthgrains Company Fidelity Money
Market Trust Fund 277,279
The Earthgrains Company Fidelity
Intermediate Bond Fund 639,641
The Earthgrains Company Fidelity U.S. Equity
Index Portfolio* 3,346,578
The Earthgrains Company Fidelity Asset
Manager Fund 1,061,911
The Earthgrains Company Fidelity Contra Fund 982,384 982,384
Participant loans - 400,707 400,707
--------- ---------- ----------
Total Investments 982,384 400,707 55,298,536
--------- ---------- ----------
Total Assets 982,400 400,707 55,783,200
--------- ---------- ----------
Liabilities:
Notes payable - - 14,446,624
Other payable - - 204,582
--------- ---------- ----------
Total Liabilities: 14,651,206
--------- ---------- ----------
Net Assets available for benefits $982,400 $400,707 $41,131,994
========= ========== ==========
<FN>
* Represents more than 5% of net assets available for benefits
</FN>
</TABLE>
The accompanying notes are an integral part of these financial
statements.
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
OWNERSHIP/401(K) PLAN
Statement of Net Assets Available for Benefits with Fund Information
June 30, 1996
Page 3
- --------------------------------------------------------------------------
<TABLE>
The Anheuser- Fidelity
Earthgrains Busch Fidelity Fidelity Fidelity U.S. asset
Company Companies money market Intermediate equity index manager
stock fund stock fund trust fund bond fund portfolio fund
<S> <C> <C> <C> <C> <C> <C>
Assets
Receivables:
Contributions:
Participant $ - $ - $ - $ - $ - $ -
Employer - - - - - -
Interest - - - - - -
---------- ---------- ---------- ---------- ---------- ----------
- - - - - -
---------- ---------- ---------- ---------- ---------- ----------
Investments, at fair value
The Earthgrains Company Common Stock 701,452
Anheuser-Busch Companies, Inc.
Common Stock* 11,366,764
The Earthgrains Company Fidelity Money
Market Trust Fund 225,063
The Earthgrains Company Fidelity
Intermediate Bond Fund 679,111
The Earthgrains Company Fidelity
U.S. Equity Index Portfolio* 1,721,787
The Earthgrains Company Fidelity Asset
Manager Fund 747,981
The Earthgrains Company Fidelity
Contra Fund
Participant loans - - - - - -
---------- ---------- ---------- ---------- ---------- ----------
Total Investments 701,452 11,366,764 225,063 679,111 1,721,787 747,981
---------- ---------- ---------- ---------- ---------- ----------
Total Assets 701,452 11,366,764 225,063 679,111 1,721,787 747,981
---------- ---------- --------- ---------- ---------- ----------
Liabilities:
Total Liabilities: - - - - - -
---------- ---------- ---------- ---------- ---------- ----------
Net Assets available for benefits $701,452 $11,366,764 $225,063 $679,111 $1,721,787 $747,981
=========== =========== ========== ========== ========== ==========
<FN>
* Represents more than 5% of net assets available for benefits
</FN>
Fidelity Participant
contra loans
fund fund Total
<S> <C> <C> <C>
Assets
Receivables:
Contributions:
Participant $ - $ - $ -
Employer - - -
Interest - - -
--------- ---------- ----------
- - -
--------- ---------- ----------
Investments, at fair value
The Earthgrains Company Common Stock 701,452
Anheuser-Busch Companies, Inc. Common Stock* 11,366,764
The Earthgrains Company Fidelity Money
Market Trust Fund 225,063
The Earthgrains Company Fidelity
Intermediate Bond Fund 679,111
The Earthgrains Company Fidelity U.S. Equity
Index Portfolio* 1,721,787
The Earthgrains Company Fidelity Asset
Manager Fund 747,981
The Earthgrains Company Fidelity Contra Fund
Participant loans - 371,877 371,877
--------- ---------- ----------
Total Investments - 371,877 371,877
--------- ---------- ----------
Total Assets - 371,877 371,877
--------- ---------- ----------
Liabilities:
Total Liabilities: - - -
--------- ---------- ----------
Net Assets available for benefits - $371,877 $371,877
========= ========== ==========
<FN>
* Represents more than 5% of net assets available for benefits
</FN>
</TABLE>
The accompanying notes are an integral part of these financial
statements.
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
OWNERSHIP/401(K) PLAN
Statement of Net Assets Available for Benefits with Fund Information
March 31, 1996
Page 4
- ---------------------------------------------------------------------------
<TABLE>
The Anheuser- Fidelity
Earthgrains Busch Fidelity Fidelity Fidelity U.S. asset
Company Companies money market Intermediate equity index manager
stock fund stock fund trust fund bond fund portfolio fund
<S> <C> <C> <C> <C> <C> <C>
Assets
Receivables:
Contributions:
Participant $ - $ 49,604 $ 1,179 $ 4,716 $ 1,768 $ 3,536
Employer
Interest - - - - - -
---------- ---------- ---------- ---------- ---------- ----------
- 49,604 1,179 4,716 1,768 3,536
---------- ---------- ---------- ---------- ---------- ----------
Investments, at fair value
The Earthgrains Company Common Stock 183,955
Anheuser-Busch Companies, Inc.
Common Stock* 10,437,756
The Earthgrains Company Fidelity Money
Market Trust Fund 209,780
The Earthgrains Company Fidelity
Intermediate Bond Fund 663,851
The Earthgrains Company Fidelity
U.S. Equity Index Portfolio* 1,461,423
The Earthgrains Company Fidelity Asset
Manager Fund 683,163
The Earthgrains Company Fidelity
Contra Fund
Participant loans - - - - - -
---------- ---------- ---------- ---------- ---------- ----------
Total Investments 183,955 10,437,756 209,780 663,851 1,461,423 683,163
---------- ---------- ---------- ---------- ---------- ----------
Total Assets 183,955 10,487,360 210,959 668,567 1,463,191 686,699
---------- ---------- --------- ---------- ---------- ----------
Liabilities:
Total Liabilities: - - - - - -
---------- ---------- ---------- ---------- ---------- ----------
Net Assets available for benefits $183,955 $10,487,360 $210,959 $668,567 $1,463,191 $686,699
=========== =========== ========== ========== ========== ==========
<FN>
* Represents more than 5% of net assets available for benefits
</FN>
Fidelity Participant
contra loans
fund fund Total
<S> <C> <C> <C>
Assets
Receivables:
Contributions:
Participant $ - $ - $60,803
Employer - - -
Interest - - -
--------- ---------- ----------
- - 60,803
--------- ---------- ----------
Investments, at fair value
The Earthgrains Company Common Stock 183,955
Anheuser-Busch Companies, Inc. Common Stock* 10,436,756
The Earthgrains Company Fidelity Money
Market Trust Fund 209,780
The Earthgrains Company Fidelity
Intermediate Bond Fund 663,851
The Earthgrains Company Fidelity U.S. Equity
Index Portfolio* 1,461,423
The Earthgrains Company Fidelity Asset
Manager Fund 683,163
The Earthgrains Company Fidelity Contra Fund
Participant loans - 178,821 178,821
--------- ---------- ----------
Total Investments - 178,821 13,818,749
--------- ---------- ----------
Total Assets - 178,821 13,879,552
--------- ---------- ----------
Liabilities:
Total Liabilities: - - -
--------- ---------- ----------
Net Assets available for benefits - $178,821 $13,879,552
========= ========== ==========
<FN>
* Represents more than 5% of net assets available for benefits
</FN>
</TABLE>
The accompanying notes are an integral part of these financial
statements.
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
OWNERSHIP/401(K) PLAN
Statement of Changes in Net Assets Available for Benefits with Fund
Information
12 Months Ended June 30, 1997
Page 5
- ---------------------------------------------------------------------------
<TABLE>
The Anheuser- Fidelity
Earthgrains Busch Fidelity Fidelity Fidelity U.S. asset
Company Companies money market Intermediate equity index manager
stock fund stock fund trust fund bond fund portfolio fund
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Contributions:
Employer $3,462,904 $ - $ - $ - $ - $ -
Participant 2,075,936 (19,380) 110,125 163,335 790,601 308,857
---------- ---------- ---------- ---------- ---------- ----------
5,538,840 (19,380) 110,125 163,335 790,601 308,857
Investment income:
Interest 13,913 44,999 501
Dividends 121,414 271,184 74,231 80,247
Net realized and unrealized appreciation
in fair value of investment 17,703,333 1,309,924 - 5,665 720,357 98,566
---------- ---------- ---------- ---------- ---------- ----------
17,824,747 1,581,108 13,913 50,664 794,588 179,314
Total additions 23,363,587 1,561,728 124,038 213,999 1,585,189 488,171
---------- ---------- ---------- ---------- ---------- ----------
Deductions from net assets attributed to:
Distributions to participants 268,512 830,572 17,088 31,127 166,051 76,711
Interest expense 1,207,523
Administrative expenses 14,800 23 483 807 3,708 1,451
---------- ---------- ---------- ---------- ---------- ----------
Total deductions 1,490,835 830,595 17,571 31,934 169,759 78,162
---------- ---------- ---------- ---------- ---------- ----------
Transfer of assets from (to)
Anheuser-Busch plans 522,155 (52,115) (642) (681) (34,077) (8,915)
Interfund transfer in (out) 802,918 (1,521,775) (53,594) (220,831) 243,549 (87,119)
---------- ---------- ---------- ---------- ---------- ----------
Net transfer in (out) 1,325,073 (1,573,890) (54,236) (221,512) 209,472 (96,034)
---------- ---------- ---------- ---------- ---------- ----------
Net increase (decrease) 23,197,825 (842,757) 52,231 (39,447) 1,624,902 313,975
Net assets available for benefits,
beginning of year 701,452 11,366,764 225,063 679,111 1,721,787 747,981
---------- ---------- ---------- ---------- ---------- ----------
Net assets available for benefits,
end of year $23,899,277 $10,524,007 $277,294 $639,664 $3,346,689 $1,061,956
=========== =========== ========== ========== ========== ==========
Fidelity Participant
contra loans
fund fund Total
<S> <C> <C> <C>
Additions to net assets attributed to:
Contributions:
Employer $ - $ - $3,462,904
Participant 52,487 174,167 3,656,128
--------- ---------- ----------
52,487 174,167 7,119,032
Investment income:
Interest 3 59,416
Dividends 16,945 564,021
Net realized and unrealized appreciation
in fair value of investment 85,211 - 19,923,056
--------- ---------- ----------
102,156 3 20,546,493
Total additions 154,643 174,170 27,665,525
--------- ---------- ----------
Deductions from net assets attributed to:
Distributions to participants 1,392 152,958 1,544,411
Interest expense 1,207,523
Administrative expenses 4 - 21,276
--------- ---------- ----------
Total deductions 1,396 152,958 2,773,210
--------- ---------- ----------
Transfer of assets from (to)
Anheuser-Busch plans (81) 425,644
Interfund transfer in (out) 829,234 7,618 -
--------- ---------- ----------
Net transfer in (out) 829,153 7,618 425,644
--------- ---------- ----------
Net increase (decrease) 982,400 28,830 25,317,959
Net assets available for benefits,
beginning of year - 371,877 15,814,035
--------- ---------- ----------
Net assets available for benefits,
end of year $982,400 $400,707 $41,131,994
========= ========== ===========
</TABLE>
The accompanying notes are an integral part of these financial
statements.
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
OWNERSHIP/401(K) PLAN
Statement of Changes in Net Assets Available for Benefits with Fund
Information
3 Months Ended June 30, 1996
Page 6
- ---------------------------------------------------------------------------
<TABLE>
The Anheuser- Fidelity
Earthgrains Busch Fidelity Fidelity Fidelity U.S. asset
Company Companies money market Intermediate equity index manager
stock fund stock fund trust fund bond fund portfolio fund
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Contributions:
Employer $ - $ - $ - $ - $ - $ -
Participant 429,504 17,974 39,764 157,133 68,387
---------- ---------- ---------- ---------- ---------- ----------
429,504 - 17,974 39,764 157,133 68,387
Investment income:
Interest
Dividends
Net realized and unrealized appreciation
in fair value of investment 26 183,394 200 1,403 11,421 7,013
---------- ---------- ---------- ---------- ---------- ----------
26 183,394 200 1,403 11,421 7,013
Total additions 429,530 183,394 18,174 41,167 168,554 75,400
---------- ---------- ---------- ---------- ---------- ----------
Deductions from net assets attributed to:
Distributions to participants 9,759 302,928 10,383 24,656 57,565 38,199
Interest expense
Administrative expenses - - - - - -
---------- ---------- ---------- ---------- ---------- ----------
Total deductions 9,759 302,928 10,383 24,656 57,565 38,199
---------- ---------- ---------- ---------- ---------- ----------
Transfer of assets from (to)
Anheuser-Busch plans 97,726 998,938 6,313 (5,967) 147,607 24,081
---------- ---------- ---------- ---------- ---------- ----------
Net increase (decrease) 517,497 879,404 14,104 10,544 258,596 61,282
Net assets available for benefits,
beginning of year 183,955 10,487,360 210,959 668,567 1,463,191 686,699
---------- ---------- ---------- ---------- ---------- ----------
Net assets available for benefits,
end of year $ 701,452 $11,366,764 $225,063 $679,111 $1,721,787 $ 747,981
=========== =========== ========== ========== ========== ==========
Fidelity Participant
contra loans
fund fund Total
<S> <C> <C> <C>
Additions to net assets attributed to:
Contributions:
Employer $ - $ - $ -
Participant 712,762
--------- ---------- ----------
- - 712,762
Investment income:
Interest 40,653 40,653
Dividends -
Net realized and unrealized appreciation
in fair value of investment - - 203,457
--------- ---------- ----------
- 40,653 244,110
Total additions - 40,653 956,872
--------- ---------- ----------
Deductions from net assets attributed to:
Distributions to participants 665 444,155
Interest expense -
Administrative expenses - - -
--------- ---------- ----------
Total deductions - 665 444,155
--------- ---------- ----------
Transfer of assets from (to)
Anheuser-Busch plans 153,068 1,421,766
--------- ---------- ----------
Net increase (decrease) 193,056 1,934,483
Net assets available for benefits,
beginning of year - 178,821 13,879,552
--------- ---------- ----------
Net assets available for benefits,
end of year $ - $371,877 $15,814,035
========= ========== ===========
</TABLE>
The accompanying notes are an integral part of these financial
statements.
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
OWNERSHIP/401(K) PLAN
Statement of Changes in Net Assets Available for Benefits with Fund
Information
12 Months Ended March 31, 1996
Page 7
- ---------------------------------------------------------------------------
<TABLE>
The Anheuser- Fidelity
Earthgrains Busch Fidelity Fidelity Fidelity U.S. asset
Company Companies money market Intermediate equity index manager
stock fund stock fund trust fund bond fund portfolio fund
<S> <C> <C> <C> <C> <C> <C>
Additions to net assets attributed to:
Contributions:
Employer $ - $767,066 $ - $ - $ - $ -
Participant 2,068,257 57,893 176,174 287,912 214,503
---------- ---------- ---------- ---------- ---------- ----------
2,835,323 57,893 176,174 287,912 214,503
Investment income:
Interest 4,420
Dividends 76,709
Net realized and unrealized appreciation
in fair value of investment 64,307 4,592,577 5,102 26,538 210,256 128,028
---------- ---------- ---------- ---------- ---------- ----------
64,307 4,673,706 5,102 26,538 210,256 128,028
Transfer in at Fund inception 119,648 - - - - -
---------- ---------- ---------- ---------- ---------- ----------
Total additions 183,955 7,509,029 62,995 202,712 498,168 342,531
---------- ---------- ---------- ---------- ---------- ----------
Deductions from net assets attributed to:
Distributions to participants 461,852 4,027 15,692 36,258 14,943
Interest expense
Administrative expenses - - - - - -
---------- ---------- ---------- ---------- ---------- ----------
Total deductions - 461,852 4,027 15,692 36,258 14,943
---------- ---------- ---------- ---------- ---------- ----------
Transfer of assets from (to)
Anheuser-Busch plans (539,761) (1,179) 1,752 9,288 (3,536)
Interfund transfer in (out) - (1,031,748) 24,852 232.921 591,910 108,486
---------- ---------- ---------- ---------- ---------- ----------
Net transfer in (out) - (1,571,509) 23,673 234,673 601,198 104,950
---------- ---------- ---------- ---------- ---------- ----------
Net increase (decrease) 183,955 5,475,668 82,641 421,693 1,063,108 432,538
Net assets available for benefits,
beginning of year - 5,011,692 128,318 246,874 400,083 254,161
---------- ---------- ---------- ---------- ---------- ----------
Net assets available for benefits,
end of year $ 183,955 $10,487,360 $210,959 $668,567 $1,463,191 $ 686,699
=========== =========== ========== ========== ========== ==========
Fidelity Participant
contra loans
fund fund Total
<S> <C> <C> <C>
Additions to net assets attributed to:
Contributions:
Employer $ - $ - $ 767,066
Participant 2,804,739
--------- ---------- ----------
- - 3,571,805
Investment income:
Interest 6,382 10,802
Dividends 76,709
Net realized and unrealized appreciation
in fair value of investment - (5,752) 5,021,056
--------- ---------- ----------
630 5,108,567
Transfer in at Fund inception - - 119,648
--------- ---------- ----------
Total additions - 630 8,800,020
--------- ---------- ----------
Deductions from net assets attributed to:
Distributions to participants 1,875 534,647
Interest expense -
Administrative expenses - - -
--------- ---------- ----------
Total deductions - 1,875 534,647
--------- ---------- ----------
Transfer of assets from (to)
Anheuser-Busch plans (533,436)
Interfund transfer in (out) - 73,579 -
--------- ---------- ----------
Net transfer in (out) - 73,579 (533,436)
--------- ---------- ----------
Net increase (decrease) - 72,334 7,731,937
Net assets available for benefits,
beginning of year - 106,487 6,147,615
--------- ---------- ----------
Net assets available for benefits,
end of year $ - $178,821 $13,879,552
========= ========== ===========
</TABLE>
The accompanying notes are an integral part of these financial
statements.
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
OWNERSHIP/401(k) PLAN
Notes to Financial Statements
June 30, 1997
Page 8
- -------------------------------------------------------------------------
1. Description of the plan
The following summary of The Earthgrains Employee Stock
Ownership/401(k) Plan (Plan) is intended to provide only a general
description of the Plan. Participants should refer to the plan document
for more complete information.
General
The Earthgrains Company Employee Stock Ownership/401(k) Plan is an
amendment and restatement, effective July 1, 1996, of The Earthgrains
Company Employee Stock Ownership Plan. The Earthgrains Company Employee
Stock Ownership Plan was an amendment and restatement, effective March 26,
1996, of the Anheuser-Busch Companies, Inc. Deferred Income Stock Purchase
and Savings Plan (for certain employees of Campbell Taggart, Inc.), which
was originally adopted by The Earthgrains Company (Earthgrains or the
Company), formerly known as Campbell Taggart, Inc., effective July 1, 1994,
for the exclusive benefit of its eligible employees.
The Plan is intended to be an employee stock ownership plan (ESOP)
within the meaning of the Internal Revenue Code (Code), designed to
primarily invest in Company common stock, and is intended to constitute a
cash or deferred arrangement pursuant to section 401(k) of the Code.
Plan amendments
Effective March 26, 1996, Earthgrains was spun-off as an independent,
public company from Anheuser-Busch Companies, Inc. (Anheuser-Busch). The
Anheuser-Busch Deferred Income Stock Purchase and Savings Plan was amended
and renamed The Earthgrains Company Employee Stock Ownership Plan,
effective March 26, 1996, in order to make certain changes consistent with
the Company's spin-off from Anheuser-Busch. On this date, provisions were
added to the Plan to permit the leveraged acquisition of Company common
stock by the Plan. Additionally, each participant's account in the Plan
was credited with one share of Earthgrains common stock for every 25 shares
of Anheuser-Busch common stock owned at the record date. As a result of
this transaction, the Plan's assets were transferred from Anheuser-Busch to
The Earthgrains Company and a new investment fund, The Earthgrains Company
Stock Fund, was created to hold investments in Earthgrains common stock.
Effective July 1, 1996, The Earthgrains Company Employee Stock Ownership
Plan was amended and renamed The Earthgrains Company Stock Ownership/401(k)
Plan and the Plan's year end was changed from March 31 to June 30.
Plan administration
The Plan's named fiduciaries are Earthgrains, as sponsor and plan
administrator, and Wachovia Bank of North Carolina, N.A. as trustee. As
sponsor, the Company has the right to amend the Plan, designate the Plan's
named fiduciaries and exercise all fiduciary functions necessary for the
operation of the Plan except those which are assigned to another named
fiduciary by the Plan or the trust agreement. The Company has appointed
the Human Resource Committee to exercise the trust agreement. The Company
has appointed the Human Resource Committee to exercise the authority and
responsibility for general administration of the Plan. The trustee has the
exclusive authority and discretion to invest, manage and hold assets of the
trust in accordance with the provisions of the Plan and the separate trust
agreement.
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
OWNERSHIP/401(k) PLAN
Notes to Financial Statements
June 30, 1997
Page 9
- -------------------------------------------------------------------------
Plan participation
Each employee of a participating employer (other than employees
covered by a collective bargaining agreement) is eligible to participate in
the Plan after the employee has been credited with one year of service.
Participation by eligible employees is voluntary.
Contributions
A participant may make matched and unmatched contributions. Both
matched and unmatched contributions may be before-tax and after-tax. A
participant may contribute from 1% to 3% of their compensation through
payroll deduction for before-tax matched contributions and after-tax
matched contributions. The sum of the matched contributions may not be
less than 1% or more than 3% of the participant's compensation. In
addition, the participant may contribute from 1%-16% of their compensation
through payroll deduction for before-tax unmatched contributions and after-
tax unmatched contributions; however, the maximum amount of before-tax
contributions allowed in calendar year 1996 was $9,500. In addition, the
sum of before-tax and after-tax contribution rates must not exceed 16% of a
participant's compensation, subject to certain limitations of the Internal
Revenue Code. The participant's employer then contributes a matching
amount equal to 100% of the matched contributions, but no more than 3% of
annual compensation.
Participant contributions vest and become non-forfeitable immediately.
Employer contributions vest and become non-forfeitable after two years of
service. Employer contributions also vest upon termination of employment
by reason of death, permanent disability, upon termination of employment
after reaching age 60, or in the event of a "change in control" of the
Company (as defined in the Plan). Forfeitures of nonvested balances are
used to pay administrative Plan expenses.
Investments
The trustee maintains The Earthgrains Company Stock Fund, the
Anheuser-Busch Stock Fund, the Fidelity Retirement Money Market Portfolio,
the Fidelity Intermediate Bond Fund, the Fidelity Asset Manager Fund, the
Fidelity U.S. Equity Index Portfolio and the Fidelity Contra Fund for the
investment of participant and employer contributions. All employer
contributions are invested in The Earthgrains Company Stock Fund. At least
50% of each participant's matched contributions must be invested in The
Earthgrains Company Stock Fund for at least one full plan year after the
date the matched contributions are credited to the Plan. After the
participant's matched contributions have matured, they may elect to invest
the matched contributions in other investment funds. The balance of
contributions can be invested in increments of 1% into any fund established
under the Plan. Earnings are reinvested in the fund to which they relate.
Distributions
The Plan permits three types of in-service withdrawals: a non-
hardship withdrawal, an age 59 1/2 withdrawal and a hardship withdrawal, as
defined in the Plan document, subject to certain restrictions.
Distributions for terminations are comprised of the participant's vested
account balance. Employer contributions may or may not be vested depending
on the circumstances of the terminations as defined in the plan document.
Any portion not vested will be forfeited if the
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
OWNERSHIP/401(k) PLAN
Notes to Financial Statements
June 30, 1997
Page 10
- --------------------------------------------------------------------------
participant is terminated and does not return to work within five years.
Termination distributions from The Earthgrains Company Stock Fund and the
Anheuser-Busch Stock Fund will be in the form of a stock certificate for
all full shares and a check for the value of any partial shares.
Alternatively, the participant may elect to receive the value of this
common stock in cash. The value of any investments in other funds will be
distributed in cash by a check unless the participant elects to have these
amounts converted to Company stock prior to distribution. All in-service
withdrawals are distributed in cash.
Participant loans
A participant may borrow before-tax and/or after-tax vested account
balances. The minimum loan amount is $1,000; the maximum amount is the
lesser of $50,000 less the highest outstanding loan balance under the Plan
during the last 12 months, or 50% of the vested account balance. The
interest rate is set at the prime rate plus one percentage point. Once the
loan has been granted, the interest rate is fixed for the entire term of
the loan. The term of the loan for the purchase of a principal residence
may be up to 10 years; the term of a loan for any other reason may not
exceed 5 years.
Expenses
Under the Plan, participants are charged an annual recordkeeping fee
in addition to a loan fee, if applicable. The recordkeeping fee is charged
against earnings on the participants' investments. All other fees of the
Plan are paid first by forfeitures of nonvested account balances and then
by the Company.
Amendment or termination of the Plan
The Company anticipates that the Plan will continue without
interruption, but reserves the right to terminate its participation in the
Plan subject to provisions of ERISA. If the Plan terminates, the
Investment Committee will direct an accounting and distribution of all
amounts held in the trust to the participants and beneficiaries. The
distributions will be made in a lump-sum to each participant or beneficiary
in the Plan account as of the termination date. This distribution will
take place no later than one year subsequent to the Plan termination.
2. Summary of significant accounting policies
Basis of accounting
The Plan's financial statements are prepared on the accrual basis of
accounting.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of additions to and
deductions from net assets during the reporting period. Actual results
could differ from those estimates.
Investment valuation
Investments in common stock, U.S. government securities and corporate
debt instruments are stated at fair value based on the quoted market price
at June 30, 1997; June 30, 1996; and
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
OWNERSHIP/401(k) PLAN
Notes to Financial Statements
June 30, 1997
Page 11
- ----------------------------------------------------------------------
March 31, 1996, respectively. Investments in interest bearing cash,
insurance contracts, and interests in common/collective trusts are stated
at fair value as determined by the trustee. Participant loans are valued
at cost which approximates fair value.
Security transactions and investment income
Investment purchases and sales, and related realized gains or losses,
are recorded on the valuation date. Interest and dividend income are also
recorded as of the valuation date. Net realized and unrealized
appreciation in fair value of investments is comprised of the change in
market value compared to the cost of investments retained in the Plan, and
realized gains and losses on security transactions which represent the
difference between proceeds and cost.
3. Federal income tax status
In 1995, the Internal Revenue Service issued a determination letter
that the Plan meets the "qualified plan" requirements of the Internal
Revenue Code for exemption from federal income taxes. The Company has
applied for a determination letter for the Plan as most recently amended,
and the Company believes that the Plan continues to meet those requirements
and is operating in compliance with the applicable requirements of the
Internal Revenue Code. Therefore, no provision for income taxes has been
included in the Plan's financial statements.
4. Benefit obligations
Benefit obligations for persons who have taken withdrawals from the
Plan are as follows:
June 30, June 30, March 31,
1997 1996 1996
The Earthgrains Company Stock Fund $ 54,922 $ 1,207 $ -
Anheuser-Busch Stock Fund 50,638 13,567
Fidelity Money Market Trust Fund 2,197 1,103
Fidelity Intermediate Bond Fund 3,693 1,667
Fidelity U.S. Equity Index Portfolio 31,832 5,619
Fidelity Asset Manager Fund 6,165 5,308
Fidelity Contra Fund 1,207 - -
-------- --------- ---------
Total $150,654 $ 28,471 $ -
======== ========= =========
In accordance with generally accepted accounting principles, these
amounts are not reported as distributions payable in the accompanying
financial statements. However, the Department of Labor regulations require
that these amounts be reported as liabilities on the Form 5500.
Accordingly, net assets available for benefits reported on the Form 5500 is
lower than that reflected in the financial statements by the above amounts.
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
OWNERSHIP/401(k) PLAN
Notes to Financial Statements
June 30, 1997
Page 12
- ------------------------------------------------------------------------
5. Transactions with parties-in-interest
At June 30, 1997, the Plan held shares of The Earthgrains Company
common stock. These shares had a total cost of $20,112,962 and total
market value of $38,345,398 at June 30, 1997. During the 12 months ended
June 30, 1997, transactions with the Company included aggregate purchases
and sales totaling $2,928,287 and $375,972, respectively.
At June 30, 1997, the Plan held shares of Anheuser-Busch common stock.
These shares had a total cost of $5,984,453 and total market value of
$10,244,638 at June 30, 1997. During the 12 months ended June 30, 1997,
transactions with Anheuser-Busch included aggregate purchases and sales
totaling $276,156 and $2,713,853, respectively.
During the 12 months ended June 30, 1997, transactions with Wachovia
Bank included aggregate purchases and sales totaling $9,218,878 and
$9,216,598, respectively.
These transactions are allowable parti-in-interest transactions under
Section 408(e) and 408(b)(8) or ERISA and the regulations thereunder.
6. Notes payable
In July 1996, the Plan issued $16,804,484 in guaranteed 8% ESOP notes
to The Earthgrains Company. Interest is payable quarterly. The ESOP shall
have the right to prepay all at any time, or any portion from time to time,
of the unpaid principal prior to maturity, without penalty or premium,
provided that on each prepayment date, the ESOP shall pay to the order of
the Company all accrued and unpaid interest on the principal portion being
prepaid to and including the date of such prepayment. Proceeds received
from issuance of the notes were used to purchase 513,114 shares of Company
common stock. The shares are maintained in the Company Stock Fund and are
released and allocated to Plan participants to fund the employer match
portion of the Plan, based on calculations specified in the plan document
as contributions are made to the Plan. During the 12 months ended June 30,
1997, 450,586 shares were released to participants. At June 30, 1997 the
Company Stock Fund held 59,838 unallocated shares.
7. Subsequent event
On May 5, 1997, the Earthgrains Board of Directors declared a two-for-
one stock split for shareholders of record as of May 30, 1997. The split
is effective July 28, 1997 and, therefore, the share amounts in Note 6 do
not reflect the stock split.
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
SCHEDULE I
OWNERSHIP/401(k) PLAN
Line 27a-Schedule of Assets Held for Investment Purposes
June 30, 1997
- --------------------------------------------------------------------------
<TABLE>
Identity of issue, borrower Current
lesser or similar party Description of investment Cost Value
<S> <C> <C> <C>
The Earthgrains Company* Common stock $20,112,962 $38,345,398
Anheuser-Busch Companies, Inc.* Common stock 5,984,453 10,244,638
Fidelity U.S. Equity Index Portfolio 2,656,626 3,346,578
Fidelity Asset Manager Fund 970,172 1,061,911
Fidelity Contra Fund 897,171 982,384
Fidelity Intermediate Bond Fund 637,121 639,641
Fidelity Money Market Trust Fund 277,279 277,279
Participant Loan Fund* Participant loans 400,707 400,707
*Represents party in interest.
</TABLE>
<PAGE>
THE EARTHGRAINS COMPANY EMPLOYEE STOCK
SCHEDULE II
OWNERSHIP/401(k) PLAN
Line 27d-Schedule of Reportable Transactions
12 Months Ended June 30, 1997
- ---------------------------------------------------------------------------
<TABLE>
Identity of Number of Number Total cost
party involved Description of asset purchases of sales of purchases
<S> <C> <C> <C> <C>
Anheuser-Busch Common Stock 37 $ -
Companies, Inc.
The Earthgrains Common Stock 23 2,928,287
Company
Wachovia Bank DTI Short-Term 272 233 9,218,878
Investment Fund
Fidelity U.S. Equity Index 29 2,859,884
Portfolio
Fidelity Intermediate Bond 26 956,281
Fund
Fidelity Asset Manager Fund 21 1,186,513
Fidelity Contra Fund 21 897,563
Identity of Total proceeds Total cost of Gain or
party involved Description of asset from sales assets sold (loss)
<S> <C> <C> <C> <C>
Anheuser-Busch Common Stock $2,708,755 $1,597,125 $1,111,630
Companies, Inc.
The Earthgrains Common Stock
Company
Wachovia Bank DTI Short-Term 9,216,598 9,216,598
Investment Fund
Fidelity U.S. Equity Index
Portfolio
Fidelity Intermediate Bond
Fund
Fidelity Asset Manager Fund
Fidelity Contra Fund
</TABLE>
Exhibit 23
Price Waterhouse LLP
Consent of Independent Accountants
We hereby consent to the incorporation by reference in this filing
on Form 11-K of our report dated May 2, 1997, which appears on page
38 of the 1997 Annual Report to Shareholders of The Earthgrains
Company, which is incororated by reference in The Earthgrains
Company's Annual Report on Form 10-K for the fiscal year ended
March 25, 1997.
/s/PRICE WATERHOUSE, LLP
Price Waterhouse, LLP
St. Louis, Missouri
December 23, 1997
