UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 2, 1994
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 0-7803
D O S K O C I L C O M P A N I E S I N C O R P O R A T E D
(Exact Name of Registrant as Specified in its Charter)
Delaware 13-2535513
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
2601 NW Expressway, Suite 1000W, Oklahoma City, Oklahoma 73112
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (405)879-5500
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
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Sections 12, 13, or
15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court.
YES X NO
On May 13, 1994, the number of shares outstanding of the
registrant's common stock, $.01 par value, was 7,940,168.
<PAGE>
DOSKOCIL COMPANIES INCORPORATED
_________________________
TABLE OF CONTENTS
FORM 10-Q
Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements:
Condensed Consolidated Balance Sheet at
April 2, 1994 (Unaudited) and
January 1, 1994. . . .. . . . . . . . . .. . 3
Condensed Consolidated Statement of
Operations - Unaudited, Three Months
Ended April 2, 1994 and
April 3, 1993 . . . .. . . . . . . . . .. . . . 4
Condensed Consolidated Statement of Cash
Flows - Unaudited, Three Months Ended
April 2, 1994 and April 3, 1993 . . . . .. 5
Notes to the Condensed Consolidated
Financial Statements - Unaudited . . . . . . . 6-7
Report of Independent Accountants. . . . .. . . 8
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations . . . . .. . . . . . . . . .. 9-11
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K . . . .. . . . 12
Signatures . . . . .. . . . . . . . . .. 13
<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
DOSKOCIL COMPANIES INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(Dollar amounts in thousands, except par value)
<CAPTION>
April 2, January 1,
ASSETS 1994 1994
________ __________
(Unaudited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 6,920 $ 6,203
Receivables 33,307 36,283
Inventories 38,942 39,984
Other current assets 3,568 2,101
________ ________
Total current assets 82,737 84,571
Property, plant and equipment, net of
accumulated depreciation and amortization
of $22,696 and $20,046 80,709 77,678
Trademarks and tradenames, net of accumulated
amortization of $3,149 and $2,837 21,851 22,163
Deferred charges and other assets 42,475 44,907
Reorganization value in excess of amounts
allocable to identifiable assets, net of
accumulated amortization of $12,324 and
and $11,090 86,328 87,562
________ ________
$314,100 $316,881
======== ========
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C> <C>
Current liabilities:
Current maturities of long-term debt $ 2,745 $ 2,330
Accounts payable 10,892 10,357
Accrued liabilities 33,292 40,732
________ ________
Total current liabilities 46,929 53,419
Long-term debt 131,654 127,906
Other long-term liabilities 80,070 79,987
Stockholders' equity:
Common stock, $.01 par value, 20,000,000
shares authorized, 7,939,173 shares
issued and outstanding (7,918,343
shares at January 1, 1994) 79 79
Capital in excess of par value 112,523 112,315
Retained earnings (deficit) (55,388) (54,910)
Minimum pension liability adjustment (1,575) (1,575)
________ ________
55,639 55,909
Unearned compensation (192) (340)
________ ________
Total stockholders' equity 55,447 55,569
________ ________
$314,100 $316,881
======== ========
<FN>
The accompanying notes are an integral part of the condensed
consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
DOSKOCIL COMPANIES INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS - UNAUDITED
(Dollar amounts in thousands, except per share figures)
<CAPTION>
Three Months Ended
_______________________
April 2, April 3,
1994 1993
________ ________
<S> <C> <C>
Net sales $156,223 $144,555
Cost of sales 129,482 120,472
________ ________
Gross profit 26,741 24,083
Operating expenses:
Selling 16,114 14,321
General and administrative 6,605 6,556
Amortization of intangible assets 1,546 1,546
________ ________
Total 24,265 22,423
________ ________
Operating income 2,476 1,660
Other income (expense):
Interest and financing costs (3,579) (3,017)
Other, net (157) (135)
________ ________
Total (3,736) (3,152)
________ ________
Income (loss) before income taxes (1,260) (1,492)
Income tax benefit (provision) 782 (38)
________ ________
Income (loss) before cumulative effect
of change in accounting principle (478) (1,530)
Cumulative effect of change in
accounting for postretirement
benefits other than pensions - (34,426)
________ ________
Net income (loss) $ (478) $(35,956)
======== ========
Earnings (loss) per share-primary
and fully diluted:
Income (loss) before cumulative
effect of change in accounting
principle $(0.06) $(0.25)
Cumulative effect of change in
accounting for postretirement
benefits other than pensions - (5.63)
______ ______
Net income (loss) $(0.06) $(5.88)
====== ======
Weighted average number of
common and common equivalent
shares outstanding - primary
and fully diluted 7,921 6,115
<FN>
The accompanying notes are an integral part of the condensed
consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
DOSKOCIL COMPANIES INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS - UNAUDITED
Increase (Decrease) in Cash and Cash Equivalents
(Dollar amounts in thousands)
<CAPTION>
Three Months Ended
____________________
April 2, April 3,
1994 1993
________ ________
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ (478) $(35,956)
Adjustments to reconcile net income (loss)
to net cash provided (used) by operating
activities:
Depreciation and amortization 4,367 3,823
Postretirement medical benefits 250 502
Income taxes (949) -
Cumulative effect of change in accounting
for postretirement benefits other
than pensions - 34,426
Changes in:
Receivables 2,935 (3,162)
Inventories 1,042 (3,716)
Other current assets (517) 659
Deferred charges and other assets (40) (744)
Accounts payable and accrued liabilities (7,305) 1,253
Other (2) 40
________ ________
Net cash provided (used) by operating
activities (697) (2,875)
________ ________
Cash flows from investing activities:
Purchase of property, plant and equipment (2,654) (2,574)
Change in deferred charges and other assets 123 191
Proceeds from sale of facilities 277 500
Net cash used by assets held for sale - (2,364)
________ ________
Net cash provided (used) by investing
activities (2,254) (4,247)
________ ________
Cash flows from financing activities:
Borrowings under revolving working capital
facilities 55,000 21,011
Payments on revolving working capital
facilities (53,000) (20,011)
Proceeds from other debt obligations 2,155 -
Payments on capital lease and other debt
obligations (487) (21,570)
Issuance of common stock - 26,883
________ ________
Net cash provided (used) by financing
activities 3,668 6,313
________ ________
Increase (decrease) in cash and cash
equivalents 717 (809)
Cash and cash equivalents, beginning of
period 6,203 9,312
________ ________
Cash and cash equivalents, end of period $ 6,920 $ 8,503
======== ========
<FN>
The accompanying notes are an integral part of the condensed
consolidated financial statements.
</TABLE>
<PAGE>
DOSKOCIL COMPANIES INCORPORATED AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED
NOTE 1 GENERAL
The accompanying condensed consolidated financial
statements include the accounts of Doskocil Companies
Incorporated ("Doskocil") and all majority-owned subsidiaries
(collectively, the "Company") and have been prepared without
audit. The Balance Sheet at January 1, 1994, has been derived
from financial statements which have been audited by Coopers &
Lybrand, independent accountants.
In the opinion of the Company, the accompanying
unaudited condensed consolidated financial statements contain all
adjustments (adjustments are of a normal, recurring nature except
for entries to record the cumulative effect on years prior to
January 3, 1993 of change in accounting for postretirement
benefits other than pensions) necessary for a fair presentation
of the financial position as of April 2, 1994, and the results of
operations and cash flows for the three months ended April 2,
1994 and April 3, 1993. Results for the three months ended April
2, 1994 are not necessarily indicative of the results which will
be realized for the year ending December 31, 1994. The financial
statements should be read in conjunction with the Company's
Annual Report on Form 10-K for the year ended January 1, 1994.
The Company adopted at the beginning of fiscal 1994
Statement of Financial Accounting Standards No. 112 "Employer's
Accounting for Postemployment Benefits." This statement sets
standards for employers' accounting for postemployment benefits
after employment but before retirement. The Company generally
does not provide such postemployment benefits, other than workers
compensation payments, the costs of which are estimated and
accrued as the events occur. Implementation of this statement
has no effect on the Company's financial condition or results of
operations.
NOTE 2 RECEIVABLES
Included in receivables of $33.3 million are trade
accounts receivable of approximately $33.1 million and a note
receivable from an officer due in one year without interest in
the approximate amount of $0.2 million.
NOTE 3 INVENTORIES
Inventories at April 2, 1994 and January 1, 1994 are
summarized as follows (in thousands):
April 2, January 1,
1994 1994
________ __________
Raw materials and supplies $11,395 $ 8,176
Work in process 6,512 6,254
Finished goods 21,035 25,554
_______ _______
$38,942 $39,984
======= =======
NOTE 4 INCOME TAXES
The provision (benefit) for income taxes consists of the
following components (in thousands):
Three Months Ended
______________________________
April 2, 1994 April 3, 1993
_____________ _____________
Current:
Federal $ 17 $ -
State 150 38
______ ______
$ 167 $ 38
====== ======
Deferred:
Federal $ (949) $ -
State - -
______ ______
$ (949) $ -
====== ======
The deferred benefit has been recognized in the first quarter of
1994 based on the Company's projected realization of the
benefit in the current year. The effective tax rate differs from
the statutory rate due primarily to amortization of intangible
assets which are not deductible for tax purposes. The effective
tax rate was calculated based on the projected taxable income for
the full fiscal year and the anticipated changes for fiscal 1994
in the deferred tax assets and related valuation allowance and
the deferred tax liabilities.
NOTE 5 SIGNIFICANT EVENT
On March 17, 1994 the Company entered into a stock
purchase agreement with International Multifoods Corporation
("IMC") with respect to the Frozen Specialty Foods division
("Frozen Specialty Foods") of IMC. Pursuant to the stock
purchase agreement, the Company will purchase all of the issued
and outstanding capital stock of International Multifoods
Foodservice Corp. ("IMFC") from IMC for approximately $138
million, subject to certain conditions and customary purchase
price adjustments (the "IMFC Acquisition"). The Company has
received a commitment from Chemical Bank, subject to completion
of documentation and other requirements, to provide a $186
million senior secured credit facility for this transaction and
to refinance the existing credit facility. Frozen Specialty
Foods, with estimated revenues for the fiscal year ended February
26, 1994 of approximately $185 million, is a processor and
marketer of prepared frozen food products primarily for the
foodservice and consumer markets. Completion of the transaction
is expected in the second quarter of fiscal 1994. Based on
the Company's historical consolidated statement of operations for
the year ended January 1, 1994 and Frozen Specialty Foods'
historical operations for the twelve months ended November 21,
1993, the pro forma combined net sales, income before
cumulative effect of changes in accounting and earnings per share
before cumulative effect of changes in accounting are
$831.5 million, $6.1 million and $0.82, respectively.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Stockholders
Doskocil Companies Incorporated
We have reviewed the condensed consolidated balance sheet of
Doskocil Companies Incorporated and subsidiaries as of
April 2, 1994, and the related condensed consolidated statements
of operations for the three month periods ended April 2,
1994 and April 3, 1993, and the condensed consolidated statements
of cash flows for the three month periods ended April 2,
1994 and April 3, 1993. These financial statements are the
responsibility of the Company's management.
We conducted our review in accordance with standards
established by the American Institute of Certified Public
Accountants. A review of interim financial information consists
principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope
than an audit conducted in accordance with generally accepted
auditing standards, the objective of which is the expression of
an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material
modifications that should be made to the condensed consolidated
financial statements referred to above for them to be in
conformity with generally accepted accounting principles.
We have previously audited, in accordance with generally
accepted auditing standards, the consolidated balance sheet as
of January 1, 1994, and the related consolidated statements of
operations, stockholders' equity and cash flows for the period
ended January 1, 1994 (not presented herein), and in our report
dated March 1, 1994, we expressed an unqualified opinion on
those consolidated financial statements. In our opinion, the
information set forth in the accompanying condensed
consolidated balance sheet as of January 1, 1994, is fairly
stated in all material respects in relation to the consolidated
balance sheet from which it has been derived.
COOPERS & LYBRAND
Tulsa, Oklahoma
April 29, 1994
<PAGE>
DOSKOCIL COMPANIES INCORPORATED
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Results of Operations
Three Months ended April 2, 1994 compared with Three Months ended
April 3, 1993. Net sales increased $11.6 million, or 8.0%,
to $156.2 million for the first three months of 1994 over net
sales of $144.6 million for the first three months of 1993.
Volume increases generated approximately $6.7 million of the net
sales increase and increases in selling price per pound
contributed approximately $4.9 million of the overall increase.
Sales volume in the Foodservice and Deli Divisions increased
over the same period in fiscal 1993. Selling price per pound
increased primarily due to the pass through of increased raw
material costs.
In the first quarter of 1994, gross profit increased $2.6
million, or 10.8%, to $26.7 million from $24.1 million for
the first quarter of 1993. Gross margin for the first quarter of
1994 was higher as a percentage of net sales than the first
quarter of 1993 due primarily to certain cost reduction programs
instituted in 1993.
During the first quarter of 1994, the Company's selling
expenses increased $1.8 million, or 12.6%, over the 1993
period's amount of $14.3 million. Selling expenses increased
primarily due to marketing costs associated with increased
volume of sales and new product introductions in the Retail
Division. General and administrative expenses totaled
approximately $6.6 million in both the first quarters of 1994 and
1993. Amortization of intangible assets, which is a
noncash element of operating expenses, was approximately $1.5
million in both the 1994 and the 1993 periods.
Interest and financing costs increased $0.6 million, or
20%, to $3.6 million for the first quarter of 1994 from $3.0
million for the first quarter of 1993. This increase is due to
the higher fixed interest rates on the Company's long term
financing entered into in the second quarter of 1993 compared to
the variable rates on debt outstanding in the first quarter
of 1993.
The provision for income taxes for the first quarter of
1994 was a benefit of $0.8 million primarily because, for
financial reporting purposes, the Company generated losses during
the period, the benefit of which is expected to be realized
in the current fiscal year. The effective tax rate was
calculated based on the projected taxable income for the full
fiscal year and the anticipated changes for fiscal 1994 in the
deferred tax assets and related valuation allowance and the
deferred tax liabilities. No such benefit was recognized in the
first quarter of 1993.
Liquidity and Capital Resources
Management believes that cash flow from operations for the
full fiscal year combined with the borrowing capacity
available under the Company's revolving working capital facility
will be sufficient to meet the Company's operating and debt
service cash requirements for the foreseeable future. Management
anticipates that the purchase price and working capital
needs of the Frozen Specialty Foods acquisition discussed below,
will be financed by borrowings under a new senior secured
credit facility. The balance outstanding under the current
revolving working capital facility at April 2, 1994 was $10.0
million and $30.0 million was available for borrowing at that
date.
On March 17, 1994 the Company entered into a stock purchase
agreement with International Multifoods Corporation ("IMC") with
respect to the Frozen Specialty Foods division ("Frozen Specialty
Foods") of IMC. Pursuant to the stock purchase agreement, the
Company will purchase all of the issued and outstanding capital
stock of International Multifoods Foodservice Corp. ("IMFC") from
IMC for approximately $138 million, subject to certain conditions
and customary purchase price adjustments (the "IMFC
Acquisition"). The Company has received a commitment from
Chemical Bank, subject to completion of documentation and other
requirements, to provide a $186 million senior secured credit
facility for this transaction and to refinance the existing
credit facility. Frozen Specialty Foods, with estimated revenues
for the fiscal year ended February 26, 1994 of approximately $185
million, is a processor and marketer of prepared frozen food
products primarily for the foodservice and consumer markets.
Completion of the transaction is expected in the second quarter
of fiscal 1994.
Cash Flows and Capital Expenditures
First three months of 1994. For the first quarter of 1994, net
cash used by operating activities was approximately $0.7
million. Decreases in cash resulted primarily from net decreases
in accounts payable and accrued liabilities of $7.3 million
due primarily to semiannual interest payments, payments related
to prior plant closings and seasonal decreases in marketing
programs. These decreases were offset partially by decreases in
accounts receivable and inventories, responsible for increases of
cash of $2.9 million and $1.0 million, respectively. The
remaining increases in cash were principally provided by the
results of operations during the quarter after adding back
noncash items of depreciation, amortization and the provision for
postretirement medical benefits and subtracting the deferred
benefit for income taxes.
Expenditures for additions to property, plant and equipment
were approximately $2.7 million for the first quarter of 1994.
Of this total, approximately $1.2 million of these expenditures
were attributable to construction of additional capacity and the
remainder for replacements and modifications to existing
facilities. The source of the funds for these expenditures was
primarily from the receipt of escrowed funds related to
construction in progress and increased borrowings under the 1993
Credit Agreement.
First three months of 1993. For the first quarter of 1993, net
cash used by operating activities was approximately $2.9
million. Decreases in cash resulted primarily from increases
during the period in receivables, responsible for a decrease in
cash of $3.2 million, and inventories, responsible for a decrease
in cash of $3.7 million. These decreases were offset somewhat by
increases in accounts payable and accrued liabilities, resulting
in an increase in cash of $1.4 million. The remaining increases
in cash were provided by the results of operations during the
period after adding back noncash items of depreciation,
amortization and the provision for postretirement benefits other
than pensions.
Expenditures for additions to property, plant and equipment
were approximately $2.6 million during the first quarter of 1993.
Approximately $1.3 million of these expenditures were
attributable to the construction of additional capacity at
the Company's South Hutchinson production facility to support
growth of the Foodservice Division. In addition, expenditures
of approximately $1.3 million were for replacement of and
modifications to existing systems and production lines.
During the first quarter of 1993, the Company issued 2.0
million shares of common stock to JLL at $15.00 per share.
The proceeds from this transaction, net of related expenses, were
used to reduce bank borrowings. The Company made repayments
during the quarter of $0.6 million on other long-term debt,
including capital lease obligations. During the quarter, the
Company increased net borrowings under the Existing Credit
Agreement by $8.0 million. The resulting net increase in cash
from these financing activities totaled $6.3 million.
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits (the following exhibits are listed and
numbered in accordance with Item 601 of Regulation S-K
as of the date of this filing)
Exhibit Number Description
______________ ___________
10.1 Amendment to Separation
Agreement and Release Dated
March 31, 1994 between
Doskocil and John Hanes
10.2 Amendment to Private Label
Manufacturing Agreement dated
April 15, 1994 between Wilson
Foods Corporation and Farmland
Foods, Inc.
11.1 Calculation of Earnings per
Share
15.1 Letter from Coopers & Lybrand
dated May 6, 1994, Regarding
Unaudited Interim Financial
Information
(b) Reports on Form 8-K
Current Report on Form 8-K, dated March 17, 1994, of
Doskocil Companies Incorporated was filed with the SEC
on April 1, 1994 with respect to the Company entering
into an agreement to purchase the stock of
International Multifoods Foodservice Corporation under
Item 2 (acquisition and disposition of assets), Item 5
(other events) and Item 7 (financial statements,
proforma financial information and exhibits).
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this Report to be
signed on its behalf by the undersigned thereunto duly
authorized.
DOSKOCIL COMPANIES INCORPORATED
Dated: May 17, 1994 By:/s/ William L. Brady
__________________________
William L. Brady
Vice President, Controller
and Assistant Secretary
EXHIBIT 10.1
AMENDMENT TO SEPARATION AGREEMENT AND RELEASE
This Amendment ("Amendment") to that certain Separation Agreement and
Release dated December 31, 1993 (the "Agreement") is made and entered into
this 31st day of March, 1994 by and between Doskocil Companies Incorporated,
a Delaware corporation ("Company"), and John T. Hanes ("JH"), an individual.
WHEREAS, the Company and JH wish to amend the above referenced Agreement in
certain respects.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Company and JH agree as
follows:
1. Separation. The Effective Date shall be May 31st, 1994.
2. 2(b) Automobile and Club Allowance. 2(b) of the Agreement is
amended by the addition of the following sentence:
In addition, a lump sum payment of $2,390 shall be payable on or about
April 1, 1994.
3. 2(c) Medical Insurance. 2(c) of the Agreement is deleted and a new
paragraph 2(c) shall read as follows:
Medical Insurance. Continued coverage equal to current coverage under the
Company's group medical insurance plan for JH and his spouse until the
beginning of the month following the date on which JH reaches, or would
have reached, age 65.
4. 2(f) Bonus. 2(f) of the Agreement is deleted and is hereby amended to
read as follows:
Bonus. If the relevant performance objectives described in the Doskocil
Companies Incorporated Annual Incentive Plan (the "Annual Incentive
Plan") are met with respect to the Company's 1994 fiscal year, then JH
shall be entitled to receive, at the time incentive bonuses would
ordinarily be paid to participants in the Annual Incentive Plan with
respect to the 1994 plan year, an incentive bonus equal to that he
would otherwise have received if he had been employed until December 31,
1994.
5. 2(i) Reimbursement for Professional Fees. The last sentence of
paragraph 2(i) of the Agreement is hereby amended to read as follows:
Such payment by the Company shall not exceed $10,500.
All other provisions of the Agreement shall remain in full force and
effect.
Doskocil Companies Incorporated
By: (Charles I. Merrick) (John T. Hanes)
____________________ _______________
Charles I. Merrick John T. Hanes
Vice President
Dated: March 31, 1994 Dated: March 31, 1994
EXHIBIT 10.2
AMENDMENT TO PRIVATE LABEL MANUFACTURING AGREEMENT
THIS AMENDMENT amends, changes and modifies that certain
AGREEMENT dated as of the 13th day of May, 1992, (the "Agreement")
by and between Wilson Foods Corporation, a corporation organized
under the laws of the State of Delaware, having offices at 2601
N.W. Expressway, Suite 1000W, Oklahoma City, Oklahoma 73112
(hereinafter called "Wilson Foods") and Farmland Foods, Inc. a -
Kansas corporation, having offices at P.O. Box 7527, Kansas City,
Missouri 64116-0227 (hereinafter called "Farmland"),
WITNESSETH:
In consideration of the mutual covenants contained
herein and other valuable consideration, the parties hereto agree
as follows:
This Amendment amends, changes and modifies the
Agreement as follows:
1. Section 5 of the Agreement is amended, changed and
modified so that after April 12, 1994, it will read as follows:
5. Term-Termination. This Agreement
may be terminated by either party hereto at
any time 36 months after April 12, 1994,
provided prior written notice has been given
to the other party at least one hundred
twenty (120) days prior to such termination,
specifying the date of such termination.
2. Schedule 1 (Annual Volume Requirements) is amended
to read as Revised Schedule 1 attached hereto and made a part
hereof effective April 12, 1994. Annual Volume Requirements shall
be reviewed annually.
3. Schedule 2 (Pricing Schedule) is amended to read as
Revised Schedule 2 attached hereto and made a part hereof effective
April 12, 1994.
IN WITNESS WHEREOF, the parties hereto, intending to be
legally bound, have executed this Agreement on the date first above
written.
ATTEST: Wilson Foods Corporation
(Darian B. Andersen) By: (James J. Krause)
____________________ _____________________
Secretary Name: James J. Krause
Title: Vice President
ATTEST: Farmland Foods, Inc.
(Patsy Grieb) By: (Christopher B. Hodges)
_____________ ___________________________
Secretary Name: Christopher B. Hodges
Title: Vice President Marketing
SCHEDULE 1
Revised 4/12/94
Annual Volume Requirements
Wilson will purchase the following volumes on an annual basis
effective with such date as shall be mutually agreed in writing by
the parties.
PRODUCT CATEGORY ANNUAL PURCHASE VOLUME
Sliced Cold Cuts 19.2 Mil Lbs -10%/+20%
Smoked Sausage 4.4 Mil Lbs -10%/+20%
Stick Sausage Products 1.0 Mil Lbs -10%/+20%
Pork Sausage .75 Mil Lbs -10%/+20%
Total Volume 25.350 Mil Lbs
The loss of any major customer that accounts for at least 5% of
Wilson's business of any product category or product within a
product category, will at the option of Wilson reduce the Annual
Purchase Volume in proportion to such loss.
Approved By:
Wilson Foods Corporation Farmland Foods, Inc.
By: (James J. Krause) By:(Christopher B. Hodges)
______________________ __________________________
Date April 15, 1994 Date April 17, 1994
SCHEDULE 2
Revised 4/12/94
This Amendment, changes and modifies the Schedule as
follows:
1. Section 2(c) of the Schedule is amended, changed and
modified so that after April 12, 1994, it will read as follows:
2(c) For the term of the Agreement, Farmland will
priceTrace Lean Pork Trimmings in the standard cost at
$15.00 plus $1.50/cwt. for freight.
2. Section 3 of the Schedule is amended, changed and
modified so that after April 12, 1994, it will read as follows:
Labor and benefit costs are indicated in the
standard cost details of each product. Labor cost may
be modified for operational changes by mutual agreement,
but will not be increased from the original base. Labor
and benefit costs will be updated when contractual
agreements between Farmland and their unions cause the
actual rates to change.
Approved By:
Wilson Foods Corporation Farmland Foods, Inc.
By: (James J. Krause) By:(Christopher B. Hodges)
_____________________ __________________________
Date April 15, 1994 Date April 17, 1994
<TABLE>
EXHIBIT 11.1
DOSKOCIL COMPANIES INCORPORATED AND SUBSIDIARIES
CALCULATION OF EARNINGS PER SHARE - UNAUDITED
(Dollar amounts in thousands, except per share figures)
<CAPTION>
Three Months Ended
___________________
April 2, April 3,
1994 1993
________ ________
<S> <C> <C>
Income (loss) before cumulative effect
of change in accounting principal $ (478) $ (1,530)
Cumulative effect of change in accounting
for postretirement benefits other than
pensions - (34,426)
________ ________
Net income (loss) $ (478) $(35,956)
======== ========
Primary earnings per share:
Weighted average number of common
shares outstanding 7,921 6,115
Common stock equivalents:
Dilutive options and warrants - -
_____ _____
Weighted average number of common and
common equivalent shares outstanding 7,921 6,115
===== =====
Income (loss) before cumulative effect
of change in accounting principal $(0.06) $(0.25)
Cumulative effect of change in accounting
for postretirement benefits other than
pensions - (5.63)
______ ______
Net income (loss) per share $(0.06) $(5.88)
====== ======
Fully diluted earnings per share:
Weighted average number of common
shares outstanding 7,921 6,115
Common stock equivalents:
Dilutive options and warrants - -
_____ _____
Weighted average number of common and
common equivalent shares outstanding 7,921 6,115
===== =====
Income (loss) before cumulative effect
of change in accounting principal $(0.06) $(0.25)
Cumulative effect of change in accounting
for postretirement benefits other than
pensions - (5.63)
______ ______
Net income (loss) per share $(0.06) $(5.88)
====== ======
</TABLE>
EXHIBIT 15.1
May 6, 1994
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: Doskocil Companies Incorporated
Registration on Form S-8
We are aware that our report dated April 29, 1994 on our review
of interim financial information of Doskocil Companies
Incorporated for the period ended April 2, 1994, and included in
the Company's quarterly report on Form 10-Q for the quarter then
ended is incorporated by reference in the Registration Statement
on Form S-8 (File No. 33-45974). Pursuant to Rule 436(c) under
the Securities Act of 1933, this report should not be considered
a part of the Registration Statement prepared or certified by us
within the meaning of Sections 7 and 11 of that Act.
COOPERS & LYBRAND
