UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended August 27, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____________to_____________
Commission File Number 1-7275
___________________________________________
CONAGRA, INC.
__________________________________________________________________
(Exact name of registrant, as specified in charter)
Delaware 47-0248710
__________________________________________________________________
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One ConAgra Drive, Omaha, Nebraska 68102-5001
__________________________________________________________________
(Address of Principal Executive Offices) (Zip Code)
(402) 595-4000
__________________________________________________________________
(Registrant's telephone number, including area code)
NA
__________________________________________________________________
(Former name, former address and former fiscal year, if changed
since last report.)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15 (d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
_______ _______
Number of shares outstanding of issuer's common stock, as of
September 24, 1995 was 238,471,961
PART I - FINANCIAL INFORMATION
CONAGRA, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in Millions)
AUG 27, MAY 28, AUG 28,
1995 1995 1994
_________ _________ _________
ASSETS
Current assets:
Cash and cash equivalents $ 92.2 $ 60.0 $ 42.1
Receivables, less allowance for
doubtful accounts of $61.3, $63.9
and $67.0 2,472.3 1,540.0 2,407.1
Margin deposits and segregated
funds - - 344.8
Inventory:
Hedged commodities 1,037.9 925.4 716.5
Other 2,471.8 2,241.9 2,465.2
_________ _________ _________
Total inventory 3,509.7 3,167.3 3,181.7
Prepaid expenses 401.5 372.9 239.3
_________ _________ _________
Total current assets 6,475.7 5,140.2 6,215.0
_________ _________ _________
Property, plant and equipment
at cost, less accumulated
depreciation of $1800.5, $1741.8
and $1629.7 2,865.7 2,796.0 2,695.7
Brands, trademarks and goodwill, at
cost less accumulated amortization 2,519.1 2,420.1 2,626.2
Other assets 429.7 444.7 398.9
_________ _________ _________
$12,290.2 $10,801.0 $ 11,935.8
_________ _________ _________
_________ _________ _________
The accompanying notes are an integral part of the consolidated
financial statements.
CONAGRA, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in Millions)
AUG 27, MAY 28, AUG 28,
1995 1995 1994
_________ _________ _________
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable $ 3,062.5 $ - $ 2,860.3
Current installments of
long-term debt 108.1 47.9 124.1
Accounts payable 1,004.1 1,574.8 1,031.4
Advances on sales 190.2 856.6 110.8
Payable to customers, clearing
associations, etc. - - 346.0
Other accrued liabilities 1,463.1 1,485.6 1,303.7
_________ _________ _________
Total current liabilities 5,828.0 3,964.9 5,776.3
_________ _________ _________
Senior long-term debt, excluding
current installments 1,664.2 1,770.0 1,423.9
Other noncurrent liabilities 920.4 940.8 1,065.1
Subordinated debt 750.0 750.0 766.0
Preferred securities of subsidiary
company 525.0 525.0 275.0
Preferred shares subject to
mandatory redemption 269.5 354.9 355.6
Common stockholders' equity:
Common stock of $5 par value,
authorized 1,200,000,000 shares,
issued 252,922,486, 252,869,958
and 252,791,925 1,264.6 1,264.3 1,264.0
Additional paid-in capital 513.7 409.9 426.7
Retained earnings 1,748.1 1,712.5 1,452.8
Foreign currency translation
adjustment (45.2) (44.9) (30.6)
Less treasury stock, at cost, common
shares 12,353,384, 7,172,312
and 4,696,512 (414.8) (206.9) (121.3)
_________ _________ _________
3,066.4 3,134.9 2,991.6
Less unearned restricted stock and
value of 18,239,477, 19,423,916 and
21,544,551 common shares held in EEF (733.3) (639.5) (717.7)
_________ _________ _________
Total common stockholders' equity 2,333.1 2,495.4 2,273.9
_________ _________ _________
$12,290.2 $10,801.0 $ 11,935.8
_________ _________ _________
_________ _________ _________
The accompanying notes are an integral part of the consolidated
financial statements.
CONAGRA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(Dollars and shares in millions except per share amounts)
THIRTEEN WEEKS ENDED
AUG 27, AUG 28,
1995 1994
_________ _________
Net sales $ 6,436.4 $ 6,245.9
_________ _________
Costs and expenses:
Cost of goods sold 5,634.4 5,506.8
Selling, administrative and
general expenses 578.3 545.1
Interest expense, net 75.9 68.7
_________ _________
6,288.6 6,120.6
_________ _________
Income before equity in earnings of
affiliates and income taxes 147.8 125.3
Equity in earnings(loss) of affiliates (0.2) 2.7
_________ _________
Income before income taxes 147.6 128.0
Income taxes 60.5 51.2
_________ _________
Net income 87.1 76.8
Less preferred dividends 5.1 6.0
_________ _________
Net income available for common stock $ 82.0 $ 70.8
_________ _________
_________ _________
Earnings per common and common
equivalent share $ 0.36 $ 0.31
_________ _________
_________ _________
Weighted average number of common
and common equivalent shares
outstanding 227.5 228.6
_________ _________
_________ _________
Cash dividends declared per common
share $ 0.208 $ 0.180
_________ _________
_________ _________
The accompanying notes are an integral part of the
consolidated financial statements.
CONAGRA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Millions)
THIRTEEN WEEKS ENDED
AUG 27, AUG 28,
Increase (decrease in Cash and Cash Equivalents) 1995 1994
_________ _________
Cash flows from operating activities:
Net income $ 87.1 $ 76.8
Adjustments to reconcile net income to net
cash used in operating activities:
Depreciation and other amortization 87.2 77.9
Goodwill amortization 17.7 17.1
Other noncash items (includes nonpension
postretirement benefits) 16.7 17.4
Change in assets and liabilities before
effects from business acquisitions (2,600.0) (2,651.6)
_________ _________
Net cash flows from operating activities (2,391.3) (2,462.4)
_________ _________
Cash flows from investing activities:
Sale of property, plant and equipment 8.6 1.9
Additions to property, plant and equipment (120.9) (76.6)
Payment for business acquisitions (162.7) (163.0)
Decrease in notes receivable-Monfort Finance
Company 39.8 64.8
Other items 0.4 (31.9)
_________ _________
Net cash flows from investing activities (234.8) (204.8)
_________ _________
Cash flows from financing activities:
Net short term borrowings 3,062.5 2,441.3
Proceeds from exercise of employee stock
options 17.4 5.4
Cash dividends paid (53.1) (46.6)
Repayment of long-term debt (46.5) (14.0)
Treasury stock purchases (311.6) -
Issuance of preferred securities of
a subsidiary company - 175.0
Employee Equity Fund stock transactions 1.9 1.0
Other items (12.3) (19.2)
_________ _________
Net cash flows from financing activities 2,658.3 2,542.9
_________ _________
Net increase (decrease) in cash & cash equivalents 32.2 (124.3)
Cash and cash equivalents at beginning of year 60.0 166.4
_________ _________
Cash and cash equivalents at end of period $ 92.2 $ 42.1
_________ _________
_________ _________
The accompanying notes are an integral part of the
consolidated financial statements.
CONAGRA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
AUGUST 27, 1995
(1) The information furnished herein relating to interim
periods has not been examined by independent Certified
Public Accountants. In the opinion of management, all
adjustments necessary for a fair statement of the
results for the periods covered have been included.
All such adjustments are of a normal recurring nature.
The accounting policies followed by the Company, and
additional footnotes, are set forth in the financial
statements included in the Company's 1995 annual
report, which report was incorporated by reference in
Form 10-K for the fiscal year ended May 28, 1995.
(2) The composition of inventories is as follows (in
millions):
AUG 27, MAY 28, AUG 28,
1995 1995 1994
________ ________ ________
Hedged commodities $1,037.9 $ 925.4 $ 716.5
Food products and livestock 1,253.8 1,232.2 1,386.0
Agricultural chemicals,
fertilizer and feed 583.8 323.1 499.8
Retail merchandise 180.2 196.4 176.0
Other, principally
ingredients and supplies 454.0 490.2 403.4
________ ________ ________
$3,509.7 $3,167.3 $3,181.7
________ ________ ________
________ ________ ________
(3) Following is a condensed statement of common stockholders'
equity (in millions):
<TABLE>
<captions>
Unearned
Add'l Foreign Restricted
Common Paid-In Retained Curr Treasury & EEF
Stock Capital Earnings Trns Adj Stock Stock Total
__________ __________ __________ __________ __________ __________ __________
<S> <C> <C> <C> <C> <C> <C> <C>
Balance 5/28/95 $ $1,264.3 $ $409.9 $ $1,712.5 $ ($44.9)$ ($206.9)$ ($639.5) $ $2,495.4
Shares issued
Employee stock
options 0.2 0.3 0.1 (0.1) 0.5
EEF* stock option,
incentive and
other employee
benefit plans (2.0) 32.3 30.3
Fair market
valuation of
EEF shares 126.2 (126.2) -
Acquisitions 0.1 0.4 0.5
Conversion of
preferred stock (21.1) 106.5 85.4
Shares acquired
Incentive plans (2.9) 0.2 (2.7)
Treasury shares
purchased (311.6) (311.6)
Foreign currency
translation
adjustment (0.3) (0.3)
Cash dividends
declared (51.5) (51.5)
Net income 87.1 87.1
__________ __________ __________ __________ __________ __________ __________
Balance 8/27/95 $ $1,264.6 $ $513.7 $ $1,748.1 $ ($45.2)$ ($414.8)$ ($733.3) $ $2,333.1
__________ __________ __________ __________ __________ __________ __________
__________ __________ __________ __________ __________ __________ __________
*Employee Equity Fund
</TABLE>
(4) On August 14, 1990, ConAgra acquired Beatrice Company
(Beatrice). As a result of the acquisition and the
significant pre-acquisition tax and other contingencies
of the Beatrice businesses and its former subsidiaries,
the consolidated post-acquisition financial statements
of ConAgra have reflected significant liabilities and
valuation allowances associated with the estimated
resolution of these contingencies.
Subsequent to the acquisition of Beatrice by ConAgra,
the Internal Revenue Service completed its audit of the
federal income tax returns of Beatrice and its
predecessors for the fiscal years ended in 1985 through
1987 and issued an examining agent's report. The
findings contained in the report were protested by
Beatrice. Agreement was reached with the Internal
Revenue Service regarding these matters in August 1995.
This settlement resolves all deficiencies proposed by
the Internal Revenue Service for 1987 and prior years,
including deficiencies relating to previously-filed
carry-back claims. The settlement allowed ConAgra to
better estimate the amounts of Beatrice state tax
liabilities that will ultimately be paid to various
state tax authorities, and the amounts of state tax and
interest that will be deductible for federal income tax
purposes. Prior to the settlement, ConAgra had recorded
a valuation allowance against deferred tax assets of
approximately $230.0 million due to uncertainties as to
the ultimate realization of these assets.
As a result of the settlement, ConAgra has released the
$230.0 million valuation allowance and has reduced
noncurrent liabilities by $135.0 million, with a
resulting reduction of goodwill associated with the
Beatrice acquisition of $365.0 million. Federal income
tax returns of Beatrice for fiscal years ended 1988,
1989 and 1990 and various state tax returns remain
open. However, after taking into account the foregoing
adjustments, management believes that the ultimate
resolution of all remaining pre-acquisition Beatrice
tax contingencies should not exceed the reserves
established for such matters.
Beatrice is also engaged in various litigation and
environmental proceedings related to businesses
divested by Beatrice prior to its acquisition by
ConAgra. The environmental proceedings include
litigation and administrative proceedings involving
Beatrice's status as a potentially responsible party at
42 Superfund, proposed Superfund or state-equivalent
sites. Beatrice has paid or is in the process of paying
its liability share at 33 of these sites. Beatrice's
known volumetric contribution exceeds 4% at seven of
the sites. Beatrice has established substantial
reserves for these matters. The environmental reserves
are based on Beatrice's best estimate of its
undiscounted remediation liabilities, which estimates
include evaluation of investigatory studies, extent of
required cleanup, the known volumetric contribution of
Beatrice and other potentially liable responsible
parties and Beatrice's prior experience in remediating
sites. Management believes the ultimate resolution of
such Beatrice legal and environmental contingenices
should not exceed the reserves established for such
matters.
ConAgra is party to a number of other lawsuits and
claims arising out of the operation of its businesses.
After taking into account liabilities recorded for all
of the foregoing matters, management believes the
ultimate resolution of such matters should not have a
material adverse effect on ConAgra's financial
condition, results of operation or liquidity.
(5) Earnings per common and common equivalent share are
calculated on the basis of the weighted average
outstanding common shares and, when applicable,
those outstanding options that are dilutive and
after giving effect to the preferred stock dividend
requirements. Fully diluted earnings per share did
not differ significantly from primary earnings per
share in any period presented.
CONAGRA, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following is management's discussion and analysis of certain
significant factors which have affected the Company's financial
condition and operating results for the periods included in the
accompanying consolidated condensed financial statements.
Results for the fiscal 1996 first quarter are not necessarily
indicative of results which may be attained in the future.
FINANCIAL CONDITION
During the first quarter of fiscal 1996, the Company's
capital investment (working capital plus noncurrent assets)
decreased $373.9 million. Working capital decreased
$527.6 million and noncurrent assets increased $153.7 million.
The decrease in working capital resulted from an increase
in notes payable due to a business acquisition and normal
property, plant and equipment additions, and from treasury
stock purchases (see below). The increase in notes payable was
was also due to the normal seasonal increase in accounts
receivable and inventory. The decrease in payables to
customers and margin deposits and segregated funds from
the prior year first quarter is the result of the sale of
Geldermann, Inc. during the third quarter of fiscal 1995.
The increase in other noncurrent assets is primarily due
to a business acquisition and normal additions to
property, plant and equipment. Versus the same period last
year, property, plant and equipment increased $170
million, mainly as the result of acquisitions. This
increase was funded by a combination of operating cash
flow and an increase in notes payable.
The Company's objective is that senior long-term debt
normally will not exceed 30 percent of total long-term debt
plus equity. At August 27, 1995, senior long-term debt
was 30 percent of total long-term debt plus equity compared
to 30 percent at May 28, 1995 and 28 percent at August 28, 1994.
The Company has indicated it intends to call some or all
of its Class E $25.00 cumulative convertible preferred
stock during calendar year 1995, subject to market
conditions and director approval. As of September 26, 1995
the Company has purchased, in the open market, 14,436,587
shares of common stock at an aggregate cost of $516.8 million
since February 1995. Such purchases are intended to cover the
anticipated conversion of the Class E preferred stock.
On September 30, 1995 the Company commenced a tender offer
for all outstanding common stock of Canada Malting Co.
Limited, one of the world's largest producers of malted
barley. The tender offer is subject to certain conditions
and is scheduled to expire October 31, 1995, subject to
extension. If the tender offer is successful, the total
amount required to purchase the common stock and pay
related expenses is approximately U.S. $296.0 million.
OPERATING RESULTS
A summary of the period to period increases (decreases) in
the principal components of operations is shown below
(dollars in millions, except per share amounts).
COMPARISON OF THE PERIODS ENDED
AUG. 27, 1995 & AUG. 28, 1994
THIRTEEN WEEKS
DOLLARS %
________________
Net sales 190.5 3.1
Cost of goods sold 127.6 2.3
Gross profit 62.9 8.5
Selling, administrative
and general expense 33.2 6.1
Interest expense, net 7.2 10.5
Income before equity in
earnings of affiliates and
income taxes 22.5 18.0
Equity in earnings of
affiliates (2.9) NM*
Income before income taxes 19.6 15.3
Income taxes 9.3 18.2
Net income 10.3 13.4
Earnings per common and common
equivalent share 0.05 16.1
*Not Measurable
All three of ConAgra's industry segments, Food Inputs &
Ingredients, Refrigerated Foods and Grocery/Diversified
Products achieved operating profit growth in the first
quarter of fiscal 1996 over fiscal 1995's first quarter.
Sources of increased sales and expenses during the first
quarter included the international trading businesses,
the grocery products companies and the potato products
businesses.
In the Refrigerated Foods segment, a major contributor
to the growth in operating profit was the fresh meat
business as beef margins benefited from abundant raw
materials and good demand. Branded packaged meats,
turkey products and cheese products also contributed
to earnings gains. Chicken products earnings declined,
but are expected to improve as the year progresses.
In the Grocery/Diversified segment, all three major
businesses contributed to first quarter operating
profit growth. The growth in earnings in the
Lamb-Weston potato products business was due, in
part, to an acquisition last year. Healthy Choice
products continued to contribute to the earnings
growth in consumer frozen foods while Hunt Foods
drove Hunt-Wesson's operating profit growth.
In the Food Inputs & Ingredients segment, the
principal sources of first quarter operating profit
growth were grain merchandising, international
fertilizer marketing and management actions last year
to eliminate unhealthy businesses. Grain processing
earnings decreased due to weak flour milling results.
Crop input earnings declined as wet weather deferred
pesticide and fertilizer sales from the first to second
quarter. Specialty retailing earnings were down.
Acquisitions, as well as unit volume increases,
contributed to ConAgra's first quarter sales growth,
partially offset by the divestiture of non-core
businesses and the weather-related decline in crop
input sales.
Operating profit is based on net sales less all
identifiable operating expenses and includes the
related equity in earnings of companies included on the
basis of the equity method of accounting. General
corporate expense, interest expense (except financial
businesses) income taxes and goodwill amortization are
excluded from segment operations. For financial
businesses, operating profit includes the effect of
interest, which is a large element of their operating
costs.
ConAgra's first quarter effective tax rate increased from
40 percent in fiscal 1995 to 41 percent in fiscal 1996
principally because of lower equity in earnings of
affiliates. Weighted average shares outstanding decreased
in fiscal 1996's first quarter over fiscal 1995's first
quarter primarily as a result of common stock repurchases.
Preferred dividends decreased because of conversion of a
portion of Class E preferred stock.
ConAgra is in the process of divesting certain non-core
businesses. During fiscal 1995, ConAgra divested Consumer
Direct (direct mail marketing), Dyno Merchandise, Inc.
(home sewing accessories), Geldermann, Inc. (financial
services), and Berliner & Marx, Inc. (meat products). In
July 1995, ConAgra also completed the sale of Petrosul
International (sulfur processing and marketing) and Alum
Rock Foodservice (cheese distribution). In October 1995,
ConAgra completed the sale of Omaha Vaccine (animal care
products). Sales and earnings of the businesses divested
and identified for divestiture are not material to
ConAgra's results of operations. The company expects that
the ultimate gain or loss on the divestiture program will
not be significant to ConAgra's results of operations.
ConAgra is required to adopt SFAS No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed Of," no later than fiscal 1997.
ConAgra has not yet quantified the effect, if any, of
implementation on the financial statements.
CONAGRA, INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS.
ConAgra's annual meeting of stockholders was held on
September 28, 1995. The stockholders elected four directors to
serve three-year terms, approved ConAgra's 1995 Stock Plan, and
ratified the appointment of Deloitte & Touche to examine ConAgra's
financial statements. Voting on these items was as following:
1. ELECTION OF DIRECTORS.
FOR WITHHELD
C. M. Harper 200,507,381 7,585,304
Carl E. Reichardt 206,617,544 1,475,141
Marjorie M. Scardino 206,321,727 1,770,985
William G. Stocks 206,286,287 1,806,398
2. RATIFICATION OF ACCOUNTANTS
FOR: 206,528,601
AGAINST: 679,105
ABSTAIN: 884,979
BROKER/NON-VOTES: -0-
3. APPROVAL OF CONAGRA'S 1995 STOCK PLAN
FOR: 178,255,617
AGAINST: 27,439,082
ABSTAIN: 2,397,986
BROKER/NON-VOTES: -0-
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(A) EXHIBITS.
10.1 - ConAgra 1995 Stock Plan
12 - Statement regarding computation of ratio
of earnings to fixed charges, and ratio
of earnings to combined fixed charges and
preferred dividends.
27 - Financial Data Schedule.
(B) REPORTS ON FORM 8-K.
ConAgra did not file any reports on Form 8-K for
the quarter ended August 27, 1995.
CONAGRA, INC.
By: /s/ James P. O'Donnell
________________________
James P. O'Donnell
Senior Vice President and
Chief Financial Officer
By: /s/ Kenneth W. DiFonzo
_____________________________
Kenneth W. DiFonzo
Vice President and Controller
Dated this 10 day of October, 1995. EXHIBIT INDEX
EXHIBIT DESCRIPTION PAGE
10.1 - ConAgra 1995 Stock Plan.......................
12 - Statement regarding computation of ratio
of earnings to fixed charges, and ratio
of earnings to combined fixed charges
and preferred dividends.......................
27 - Financial Data Schedule.......................
EXHIBIT 10.1
CONAGRA 1995 STOCK PLAN
SECTION 1
NAME AND PURPOSE
1.1 Name. The name of the plan shall be the ConAgra 1995
Stock Plan (the "Plan").
1.2. Purpose of Plan. The purpose of the Plan is to foster and
promote the long-term financial success of the Company and increase
stockholder value by (a) motivating superior performance by means
of stock incentives, (b) encouraging and providing for the
acquisition of an ownership interest in the Company by Employees
and (c) enabling the Company to attract and retain the services of
a management team responsible for the long-term financial success
of the Company.
SECTION 2
DEFINITIONS
2.1 Definitions. Whenever used herein, the following terms
shall have the respective meanings set forth below:
(a) "Act" means the Securities Exchange Act of 1934, as
amended.
(b) "Award" means any Option, Stock Appreciation Right,
Restricted Stock, Stock Bonus, or any combination
thereof, including Awards combining two or more types of
Awards in a single grant.
(c) "Board" means the Board of Directors of the Company.
(d) "Code" means the Internal Revenue Code of 1986, as
amended.
(e) "Committee" means the Human Resources Committee of the
Board, which shall consist of two or more members, each
of whom shall be a "disinterested person" within the
meaning of Rule 16b-3 as promulgated under the Act.
(f) "Company" means ConAgra, Inc., a Delaware corporation
(and any successor thereto) and its Subsidiaries.
(g) "Director Award" means an award of Stock and an award of
a Nonstatutory Stock Option granted to each Eligible
Director pursuant to Section 7.1 without any action by
the Board or the Committee.
(h) "Eligible Director" means a person who is serving as a
member of the Board and who is not an Employee.
(i) "Employee" means any employee of the Company or any of
its Subsidiaries.
(j) "Fair Market Value" means, on any date, the closing price
of the Stock as reported on the New York Stock Exchange
(or on such other recognized market or quotation system
on which the trading prices of the Stock are traded or
quoted at the relevant time) on such date. In the event
that there are no Stock transactions reported on such
exchange (or such other system) on such date, Fair Market
Value shall mean the closing price on the immediately
preceding date on which Stock transactions were so
reported.
(k) "Option" means the right to purchase Stock at a stated
price for a specified period of time. For purposes of the
Plan, an Option may be either (i) an Incentive Stock
Option within the meaning of Section 422 of the Code or
(ii) a Nonstatutory Stock Option.
(l) "Participant" means any Employee designated by the
Committee to participate in the Plan.
(m) "Plan" means the ConAgra 1995 Stock Plan, as in effect
from time to time.
(n) "Restricted Stock" shall mean a share of Stock granted to
a Participant subject to such restrictions as the
Committee may determine.
(o) "Stock" means the Common Stock of the Company, par value
$5.00 per share.
(p) "Stock Appreciation Right" means the right, subject to
such terms and conditions as the Committee may determine,
to receive an amount in cash or Stock, as determined by
the Committee, equal to the excess of (i) the Fair Market
Value, as of the date such Stock Appreciation Right is
exercised, of the number shares of Stock covered by the
Stock Appreciation Right being exercised over (ii) the
aggregate exercise price of such Stock Appreciation
Right.
(q) "Stock Bonus" means the grant of Stock as compensation
from the Company, which may be in lieu of cash
compensation otherwise receivable by the Participant or
in addition to such cash compensation, and includes stock
issued for service awards and other Employee recognition
programs.
(r) "Subsidiary" means any corporation, partnership, joint
venture or other entity in which the Company owns,
directly or indirectly, 25% or more of the voting power
or of the capital interest or profits interest of such
entity.
2.2 Gender and Number. Except when otherwise indicated by
the context, words in the masculine gender used in the Plan shall
include the feminine gender, the singular shall include the plural,
and the plural shall include the singular.
SECTION 3
ELIGIBILITY AND PARTICIPATION
Except as otherwise provided in Section 7.1, the only persons
eligible to participate in the Plan shall be those Employees
selected by the Committee as Participants.
SECTION 4
POWERS OF THE COMMITTEE
4.1 Power to Grant. The Committee shall determine the
Participants to whom Awards shall be granted, the type or types of
Awards to be granted, and the terms and conditions of any and all
such Awards. The Committee may establish different terms and
conditions for different types of Awards, for different
Participants receiving the same type of Awards, and for the same
Participant for each Award such Participant may receive, whether or
not granted at different times.
4.2 Administration. The Committee shall be responsible for
the administration of the Plan. The Committee, by majority action
thereof, is authorized to prescribe, amend, and rescind rules and
regulations relating to the Plan, to provide for conditions deemed
necessary or advisable to protect the interests of the Company, and
to make all other determinations necessary or advisable for the
administration and interpretation of the Plan in order to carry out
its provisions and purposes. Determinations, interpretations, or
other actions made or taken by the Committee pursuant to the
provisions of the Plan shall be final, binding, and conclusive for
all purposes and upon all persons. Notwithstanding anything else
contained in the Plan to the contrary, neither the Committee nor
the Board shall have any discretion regarding whether an Eligible
Director receives a Director Award pursuant to Section 7.1 or
regarding the terms of any such Director Award, including, without
limitation, the number of shares subject to any such Director
Award.
SECTION 5
STOCK SUBJECT TO PLAN
5.1 Number. Subject to the provisions of Section 5.3, the
number of shares of Stock subject to Awards (including Director
Awards) under the Plan may not exceed 11,000,000 shares of Stock.
The shares to be delivered under the Plan may consist, in whole or
in part, of treasury Stock or authorized but unissued Stock, not
reserved for any other purpose. The maximum number of shares of
Stock with respect to which Awards may be granted to any one
Employee under the Plan is 10% of the aggregate number of shares of
Stock available for Awards under Section 5.1.
5.2 Cancelled, Terminated or Forfeited Awards. Any shares of
Stock subject to an Award which for any reason are cancelled,
terminated or otherwise settled without the issuance of any Stock
shall again be available for Awards under the Plan.
5.3 Adjustment in Capitalization. In the event of any Stock
dividend or Stock split, recapitalization (including, without
limitation, the payment of an extraordinary dividend), merger,
consolidation, combination, spin-off, distribution of assets to
stockholders, exchange of shares, or other similar corporate
change, (i) the aggregate number of shares of Stock available for
Awards under Section 5.1 and (ii) the number of shares and exercise
price with respect to Options and the number, prices and dollar
value of other Awards, may be appropriately adjusted by the
Committee, whose determination shall be conclusive. If, pursuant to
the preceding sentence, an adjustment is made to the number of
shares of Stock authorized for issuance under the Plan, a
corresponding adjustment shall be made to the number of shares
subject to each Director Award thereafter granted pursuant to
Section 7.1.
SECTION 6
STOCK OPTIONS
6.1 Grant of Options. Options may be granted to Participants
at such time or times as shall be determined by the Committee.
Options granted under the Plan may be of two types: (i) Incentive
Stock Options and (ii) Nonstatutory Stock Options. The Committee
shall have complete discretion in determining the number of
Options, if any, to be granted to a Participant. Each Option shall
be evidenced by an Option agreement that shall specify the type of
Option granted, the exercise price, the duration of the Option, the
number of shares of Stock to which the Option pertains, the
exercisability (if any) of the Option in the event of death,
retirement, disability or termination of employment, and such other
terms and conditions not inconsistent with the Plan as the
Committee shall determine.
6.2 Option Price. Nonstatutory Stock Options and Incentive
Stock Options granted pursuant to the Plan shall have an exercise
price which is not less than the Fair Market Value on the date the
Option is granted.
6.3 Exercise of Options. Options awarded to a Participant
under the Plan shall be exercisable at such times and shall be
subject to such restrictions and conditions as the Committee may
impose, subject to the Committee's right to accelerate the
exercisability of such Option in its discretion. Notwithstanding
the foregoing, no Option shall be exercisable for more than ten
years after the date on which it is granted.
6.4 Payment. The Committee shall establish procedures
governing the exercise of Options, which shall require that written
notice of exercise be given and that the Option price be paid in
full in cash or cash equivalents, including by personal check, at
the time of exercise or pursuant to any arrangement that the
Committee shall approve. The Committee may, in its discretion,
permit a Participant to make payment (i) in Stock already owned by
the Participant valued at its Fair Market Value on the date of
exercise (if such Stock has been owned by the Participant for at
least six months) or (ii) by electing to have the Company retain
Stock which would otherwise be issued on exercise of the Option,
valued at its Fair Market Value on the date of exercise. As soon as
practicable after receipt of a written exercise notice and full
payment of the exercise price, the Company shall deliver to the
Participant a certificate or certificates representing the acquired
shares of Stock.
6.5 Incentive Stock Options. Notwithstanding anything in the
Plan to the contrary, no term of this Plan relating to Incentive
Stock Options shall be interpreted, amended or altered, nor shall
any discretion or authority granted under the Plan be so exercised,
so as to disqualify the Plan under Section 422 of the Code, or,
without the consent of any Participant affected thereby, to cause
any Incentive Stock Option previously granted to fail to qualify
for the Federal income tax treatment afforded under Section 421 of
the Code. In furtherance of the foregoing, (i) the aggregate Fair
Market Value of shares of Stock (determined at the time of grant of
each Option) with respect to which Incentive Stock Options are
exercisable for the first time by an Employee during any calendar
year shall not exceed $100,000 or such other amount as may be
required by the Code, (ii) an Incentive Stock Option may not be
exercised more than three months following termination of
employment (except as the Committee may otherwise determine in the
event of death or disability), and (iii) if the Employee receiving
an Incentive Stock Option owns Stock possessing more than 10% of
the total combined voting power of all classes of Stock of the
Company, the exercise price of the Option shall be at least 110% of
Fair Market Value and the Option shall not be exercisable after the
expiration of five years from the date of grant. An Incentive
Stock Option may be granted only to Employees who are employed by
the Company or a "subsidiary corporation" as defined in Section 425
of the Code.
SECTION 7
DIRECTOR AWARDS
7.1 Amount of Award. Each Eligible Director shall receive
annually (i) a grant of a Nonstatutory Stock Option for 4,500
shares of Stock and (ii) a grant of 900 shares of Stock from the
Company's treasury shares. Such grants shall be made each year
immediately following the annual meeting of Company stockholders to
those persons who are Eligible Directors immediately following such
meeting.
7.2 No Other Awards. An Eligible Director shall not receive
any other Award under the Plan.
SECTION 8
STOCK APPRECIATION RIGHTS
8.1 SAR's In Tandem with Options. Stock Appreciation Rights
may be granted to Participants in tandem with any Option granted
under the Plan, either at or after the time of the grant of such
Option, subject to such terms and conditions, not inconsistent with
the provisions of the Plan, as the Committee shall determine. Each
Stock Appreciation Right shall only be exercisable to the extent
that the corresponding Option is exercisable, and shall terminate
upon termination or exercise of the corresponding Option. Upon the
exercise of any Stock Appreciation Right, the corresponding Option
shall terminate.
8.2 Other Stock Appreciation Rights. Stock Appreciation
Rights may also be granted to Participants separately from any
Option, subject to such terms and conditions, not inconsistent with
the provisions of the Plan, as the Committee shall determine.
SECTION 9
RESTRICTED STOCK
9.1 Grant of Restricted Stock. The Committee may grant
Restricted Stock to Participants at such times and in such amounts,
and subject to such other terms and conditions not inconsistent
with the Plan as it shall determine. Each grant of Restricted
Stock shall be subject to such restrictions, which may relate to
continued employment with the Company, performance of the Company,
or other restrictions, as the Committee may determine. Each grant
of Restricted Stock shall be evidenced by a written agreement
setting forth the terms of such Award.
9.2 Removal of Restrictions. The Committee may accelerate or
waive such restrictions in whole or in part at any time in its
discretion.
SECTION 10
STOCK BONUSES
10.1 Grant of Stock Bonuses. The Committee may grant a Stock
Bonus to a Participant at such times and in such amounts, and
subject to such other terms and conditions not inconsistent with
the Plan, as it shall determine.
10.2 Effect on Compensation. The Committee may from time to
time grant a Stock Bonus in lieu of salary or cash bonuses
otherwise payable to a Participant.
SECTION 11
AMENDMENT, MODIFICATION, AND TERMINATION OF PLAN
11.1 General. The Board may from time to time amend, modify
or terminate any or all of the provisions of the Plan, subject to
the provisions of this Section 11.1. The Board may not change the
Plan in a manner which would prevent outstanding Incentive Stock
Options granted under the Plan from being Incentive Stock Options
without the consent of the optionees concerned. Furthermore, the
Board may not make any amendment which would (i) materially modify
the requirements for participation in the Plan, (ii) increase the
number of shares of Stock subject to Awards under the Plan pursuant
to Section 5.1, or (iii) make any other amendments which would
cause the Plan not to comply with Rule 16b-3 under the Act, in each
case without the approval of the Company's stockholders. No
amendment or modification shall affect the rights of any Employee
with respect to a previously granted Award, nor shall any amendment
or modification affect the rights of any Eligible Director pursuant
to a previously granted Director Award.
11.2 Termination of Plan. No further Options shall be granted
under the Plan subsequent to September 30, 2005, or such earlier
date as may be determined by the Board.
SECTION 12
MISCELLANEOUS PROVISIONS
12.1 Nontransferability of Awards. No Awards granted under
the Plan may be sold, transferred, pledged, assigned, or otherwise
alienated or hypothecated, other than by will or by the laws of
descent and distribution; provided, the Committee may grant Options
which are transferable, without payment of consideration, to
immediate family members of the Participant or to trusts or
partnerships for such family members, with any such transferee
subject to all conditions of the Option. Subject to the preceding
sentence, all rights with respect to Awards granted to a
Participant under the Plan shall be exercisable during the
Participant's lifetime only by such Participant and all rights with
respect to any Director Awards granted to an Eligible Director
shall be exercisable during the Director's lifetime only by such
Eligible Director.
12.2 Beneficiary Designation. Each Participant under the Plan
may from time to time name any beneficiary or beneficiaries (who
may be named contingent or successively) to whom any benefit under
the Plan is to be paid or by whom any right under the Plan is to be
exercised in case of his death. Each designation will revoke all
prior designations by the same Participant shall be in a form
prescribed by the Committee, and will be effective only when filed
in writing with the Committee. In the absence of any such
designation, Awards outstanding at death may be exercised by the
Participant's surviving spouse, if any, or otherwise by his estate.
12.3 No Guarantee of Employment or Participation. Nothing in
the Plan shall interfere with or limit in any way the right of the
Company or any Subsidiary to terminate any Participant's employment
at any time, nor confer upon any Participant any right to continue
in the employ of the Company or any Subsidiary. No Employee shall
have a right to be selected as a Participant, or, having been so
selected, to receive any future Awards.
12.4 Tax Withholding. The Company shall have the power to
withhold, or require a Participant or Eligible Director to remit to
the Company, an amount sufficient to satisfy federal, state, and
local withholding tax requirements on any Award under the Plan, and
the Company may defer issuance of Stock until such requirements are
satisfied. The Committee may, in its discretion, permit a
Participant to elect, subject to such conditions as the Committee
shall impose, (i) to have shares of Stock otherwise issuable under
the Plan withheld by the Company or (ii) to deliver to the Company
previously acquired shares of Stock, in each case having a Fair
Market Value sufficient to satisfy all or part of the Participant's
estimated total federal, state and local tax obligation associated
with the transaction.
12.5 Change of Control. On the date of a Change of Control
(as herein defined), all outstanding Options and Stock Appreciation
Rights shall become immediately exercisable and all restrictions
with respect to Restricted Stock shall lapse. Change of Control
shall mean:
(a) The acquisition (other than from the Company) by any
person, entity or "group," within the meaning of Section
13(d)(3) or 14(d)(2) of the Act (excluding, for this
purpose, the Company or its subsidiaries, or any employee
benefit plan of the Company or its subsidiaries which
acquires beneficial ownership of voting securities of the
Company) of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Act) of 30% or more of
either the then outstanding shares of common stock or
the combined voting power of the Company's then
outstanding voting securities entitled to vote generally
in the election of directors; or
(b) Individuals who, as of the date hereof, constitute the
Board (as of the date hereof the "Incumbent Board") cease
for any reason to constitute at least a majority of the
Board, provided that any person becoming a director
subsequent to the date hereof whose election, or
nomination for the election by the Company's
stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent
Board shall be, for purposes of this Plan, considered as
though such person were a member of the Incumbent Board;
or
(c) Approval by the stockholders of the Company of a
reorganization, merger or consolidation, in each case,
with respect to which persons who were the stockholders
of the Company immediately prior to such reorganization,
merger or consolidation do not, immediately thereafter,
own more than 50% of the combined voting power entitled
to vote generally in the election of directors of the
reorganized, merged or consolidated company's then
outstanding voting securities, or a liquidation or
dissolution of the Company or of the sale of all or
substantially all of the assets of the Company.
12.6 Company Intent. The Company intends that the Plan comply
in all respects with Rule 16b-3 under the Act, and any ambiguities
or inconsistencies in the construction of the Plan shall be
interpreted to give effect to such intention.
12.7 Requirements of Law. The granting of Awards and the
issuance of shares of Stock shall be subject to all applicable
laws, rules, and regulations, and to such approvals by any
governmental agencies or securities exchanges as may be required.
12.8 Effective Date. The Plan shall be effective upon its
adoption by the Board subject to approval by the Company's
stockholders at the 1995 annual stockholders' meeting.
12.9 Governing Law. The Plan, and all agreements hereunder,
shall be construed in accordance with and governed by the laws of
the State of Delaware.
EXHIBIT 12
CONAGRA, INC. AND SUBSIDIARIES
COMPUTATIONS OF RATIOS OF EARNINGS TO FIXED
CHARGES AND OF EARNINGS TO COMBINED FIXED
CHARGES & PREFERRED STOCK DIVIDENDS
($ IN MILLIONS)
Three
Months Ended
August 27,
1995
____________
Fixed charges:
Interest expense $ 87.6
Capitalized interest 1.0
Interest in cost of goods sold 3.2
One third of non-cancellable lease rent 9.8
------------
Total fixed charges (A) 101.6
Add preferred stock dividends of the company 8.6
------------
Total fixed charges and preferred stock
dividends (B) 110.2
============
Earnings:
Pretax income 147.6
Adjustment for unconsolidated subidiaries 0.4
------------
Pretax income of the Company as a whole 148.0
Add fixed charges 101.6
Less capitalized interest (1.0)
------------
Earnings and fixed charges (C) 248.6
============
Ratio of earnings to fixed charges (C/A) 2.4
Ratio of earnings to combined fixed charges
and preferred stock dividends (C/B) 2.3
EXHIBIT 12 (Continued)
For the purpose of computing the above ratio of earnings to
fixed charges, earnings consist of income before taxes and
fixed charges. Fixed charges, for the purpose of computing
earnings are adjusted to exclude interest capitalized. Fixed
charges include interest on both long and short-term debt
(whether said interest is expensed or capitalized and including
interest charged to cost of goods sold), and a portion of
noncancellable rental expense representative of the interest
factor. The ratio is computed using the amounts for ConAgra as
a whole, including its majority-owned subsidiaries, whether or
not consolidated, and its proportionate share of any 50% owned
subsidiaries, whether or not ConAgra guarantees obligations
of these subsidiaries.
For purposes of calculating the above ratio of earnings to
combined fixed charges and preferred dividends, preferred stock
dividend requirements (computed by increasing preferred stock
dividends to an amount representing the pre-tax earnings
which would be required to cover such dividend requirements)
are combined with fixed charges as described above, and the
total is divided into earnings as described above.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-mos
<FISCAL-YEAR-END> may-26-1996
<PERIOD-END> aug-27-1995
<CASH> 92,200
<SECURITIES> 0
<RECEIVABLES> 2,533,600
<ALLOWANCES> 61,300
<INVENTORY> 3,509,700
<CURRENT-ASSETS> 6,475,700
<PP&E> 4,666,200
<DEPRECIATION> 1,800,500
<TOTAL-ASSETS> 12,290,200
<CURRENT-LIABILITIES> 5,828,000
<BONDS> 2,414,200
<COMMON> 1,264,600
269,500
525,000
<OTHER-SE> 1,068,500
<TOTAL-LIABILITY-AND-EQUITY> 12,290,200
<SALES> 6,436,400
<TOTAL-REVENUES> 6,436,400
<CGS> 5,634,400
<TOTAL-COSTS> 5,634,400
<OTHER-EXPENSES> 578,300
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 75,900
<INCOME-PRETAX> 147,600
<INCOME-TAX> 60,500
<INCOME-CONTINUING> 87,100
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 87,100
<EPS-PRIMARY> 0.36
<EPS-DILUTED> 0
</TABLE>
