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 Quarter Ended September 28, 1996 Commission File No.
0-14960
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
GOLDEN POULTRY COMPANY, INC.
(Exact name of registrant as specified in its charter)
GEORGIA 58-1492075
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
244 Perimeter Center Parkway, N.E., Atlanta, Georgia 30346
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code) (770) 393-
5050
N/A
(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
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
OUTSTANDING AS OF
CLASS November 11, 1996
Common Stock, No
Par Value 14,527,433
GOLDEN POULTRY COMPANY, INC. AND SUBSIDIARY
INDEX
Page No.
Part I. Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets -
September 28, 1996 and June 29, 1996 . . 1
Consolidated Statements of Operations -
Three Months ended September 28, 1996 and
September 30, 1995 . . . . . . . . . . . 2
Consolidated Statements of Cash Flows -
Three Months Ended September 28, 1996
and September 30, 1995. . . . . . . . . . 3
Notes to Consolidated Financial
Statements . . . . . . . . . . . . . . 4 - 5
Item 2. Management's Discussion and Analysis of
Consolidated Results of Operations and
Financial Condition . . . . . . . . . . . 6 - 8
Part II. Other Information
Item 1. Legal Proceedings . . . . . . . . . . . . . 9
Item 6. Exhibits and Reports on Form 8-K . . . . . 9
<TABLE>
Page 1
GOLDEN POULTRY COMPANY, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
(Unaudited)
<CAPTION>
Sept. 28, 1996 June 29, 1996
ASSETS
<S> <C> <C>
Current assets:
Cash and cash equivalent $ 3,704 2,599
Trade accounts receivable less allowance
for doubtful accounts of $31 at
Sept. 28, 1996 and at June 29, 1996 27,884 23,654
Inventories (note 3) 62,031 54,903
Other 6,559 2,468
Total current assets 100,178 83,624
Property, plant and equipment, net 86,834 73,738
Other assets 4,487 6,617
$191,499 163,679
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 599 585
Short-term borrowings from Gold Kist
(note 4) 9,503 -
Accounts payable 36,729 26,292
Due to Gold Kist 5,520 1,207
Income taxes payable 2,477 2,705
Accrued compensation and related expenses 6,608 8,300
Total current liabilities 61,436 39,089
Long-term debt, excluding current portion 6,590 4,840
Other liabilities 5,495 5,495
Total liabilities 73,521 49,424
Minority interest in consolidated partnership 10,468 10,198
Shareholders' equity:
Preferred stock, $1.00 par value.
Authorized 1,000 shares; no shares issued - -
Common stock, no stated par value.
Authorized 20,000 shares; issued 14,882
shares at Sept. 28, 1996 and at
June 29, 1996 65,464 65,464
Retained earnings 44,265 41,112
109,729 106,576
Less treasury stock, at cost, 358 shares
at Sept. 28, 1996 and June 29, 1996 2,219 2,219
Total shareholders' equity 107,510 104,357
Contingency (note 5)
$191,499 163,979
See Accompanying Notes to Consolidated Financial Statements.
</TABLE>
<TABLE>
Page 2
GOLDEN POULTRY COMPANY, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share data)
(Unaudited)
<CAPTION>
Three Months Ended
Sept. 28, Sept. 30
1996 1995
<S> <C> <C>
Net sales $175,700 143,624
Cost of sales 164,689 132,321
Gross profit 11,011 11,303
Selling, administrative and general
expenses 5,306 5,102
Operating income 5,705 6,201
Other (expense) income:
Interest expense (256) (455)
Miscellaneous, net 123 76
(133) (379)
Earnings before minority interest
and income taxes 5,572 5,822
Minority interest in partnership loss (271) 563
Earnings before income taxes 5,301 6,385
Income taxes 2,003 2,383
Net earnings $ 3,298 4,002
Net earnings per share $ .23 .28
Weighted average outstanding shares 14,523 14,518
Cash dividends per share $ .01 .01
See Accompanying Notes to Consolidated Financial Statements.
</TABLE>
<TABLE>
Page 3
GOLDEN POULTRY COMPANY, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(Amounts in thousands)
<CAPTION>
Three Months Ended
Sept. 28, Sept. 30,
1996 1995
<S> <C> <C> <C>
Cash flows from operating activities:
Net earnings $ 3,298 4,002
Non-cash items included in net earnings:
Depreciation 3,278 4,256
Minority interest in partnership gain (loss) 271 (563)
Deferred taxes (399) (212)
Other - (10)
Changes in operating assets and liabilities:
Trade accounts receivable (4,230) 275
Inventories (7,128) 483
Accounts payable and accrued compensation and
related expenses 8,745 4,228
Due to Gold Kist 3,641 (162)
Income taxes (228) 2,118
Other (4,066) (3,594)
Net cash provided by operating activities 3,182 10,821
Cash flows from investing activities:
Acquisitions of property, plant and equipment (13,875) (2,100)
Other 3 23
Net cash used in investing activities (13,872) (2,077)
Cash flows from financing activities:
Short-term borrowings (repayments), net, payable
to Gold Kist 10,176 (2,086)
Principal payments of long-term debt (36) (6,186)
Proceeds from long-term debt 1,800 -
Dividends paid (145) (145)
Net cash used in financing activities 11,795 (8,417)
Net change in cash and cash equivalents 1,105 327
Cash and cash equivalents at beginning of period 2,599 2,720
Cash and cash equivalents at end of period $ 3,704 3,047
Supplemental disclosure of cash flow information:
Cash paid during the periods for:
Interest (net of amounts capitalized) $ 256 458
Income taxes $ 2,630 477
See Accompanying Notes to Consolidated Financial Statements.
</TABLE>
Page 4
GOLDEN POULTRY COMPANY, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in thousands)
(Unaudited)
1. The accompanying unaudited consolidated financial statements
reflect the accounts of Golden Poultry Company, Inc. and its
subsidiary and a majority owned partnership, Carolina Golden
Products Company (collectively, "the Company"). These
consolidated financial statements should be read in
conjunction with Management's Discussion and Analysis of
Financial Condition and Results of Operations and the Notes
to Consolidated Financial Statements on pages 11 through 15
and pages 22 through 29, respectively, of the Company's
Annual Report in the previously filed Form 10-K for the year
ended June 29, 1996.
2. In the opinion of management, the accompanying unaudited
consolidated financial statements contain all adjustments
(consisting of normal recurring accruals) necessary to
present fairly the financial position, results of operations,
and cash flows. Results of operations for interim periods
are not necessarily indicative of results for the entire
year.
3. Inventories consist of the following:
<TABLE>
<CAPTION>
September 28, 1996 June 29, 1996
<S> <C> <C>
Live poultry $38,732 32,255
Feed, eggs, and supplies 13,091 13,069
Marketable products 10,208 9,579
$62,031 54,903
</TABLE>
4. The amounts outstanding represent borrowings by Carolina
Golden Products under a $15.0 million Revolving Credit
Agreement with Gold Kist.
5. In January 1993, certain Alabama member patrons of Gold Kist
Inc. filed a lawsuit in the Circuit Court of Jefferson
County, Alabama, Tenth Judicial Circuit against the Company
and Gold Kist Inc. and certain directors and officers of the
companies. (Ronald Pete Windham and Windham Enterprises,
Inc. on their behalf and on behalf of and for the use and
benefit of Gold Kist, Inc. and its shareholders/members v.
Harold O. Chitwood, individually in his capacity as an
officer of Gold Kist and a Director of Golden Poultry; et
al). The lawsuit alleges that the named defendants violated
their fiduciary duties by diverting corporate opportunities
from Gold Kist to the Company and Carolina Golden Products
Company in connection with the creation of the Company and
Carolina Golden Products Company and by permitting their
continued operations. Among the remedies requested were the
transfer of the Company's operations to Gold Kist. In March
1994, the Court certified the Windham litigation as a class
action. In September 1995, the Company and Carolina Golden
Products Company were dismissed from the litigation. On
October 25, 1995, the jury in the Windham case returned
verdicts in favor of the plaintiffs in the litigation. On
July 2, 1996, the Jefferson County, Alabama Circuit Court
Judge entered a memorandum opinion and non-final judgment in
the case directing Gold Kist to acquire the approximately 27%
of Company shares currently owned by investors so that all of
the issued and outstanding stock of the Company would be
owned by Gold Kist. The Court denied the plaintiffs' demands
for additional allocations and cash distributions to the
class members. On September 13, 1996, subsequent to Motions
for Reconsideration filed by the plaintiffs and Gold Kist,
Page 5
the court entered a Final Judgment and Decree amending its July
2, 1996 Order. The Final Judgment and Decree, clarified and
reaffirmed by order of the Court dated November 4, 1996, relieves
Gold Kist of the requirement to acquire the 27% of Golden Poultry
common stock not already owned by Gold Kist. This Final Judgment
and Decree requires Gold Kist to acquire or redeem all Golden
Poultry common stock and/or stock options held or issued to Gold
Kist officers and directors. An appeal of the Final Judgment may
be filed by the parties, which could have the effect of staying
the Final Judgment pending the outcome of any appeal. These are
approximately 309,000 shares and options of the Golden Poultry
common stock owned by Gold Kist officers and directors. The
Company is also party to other various legal and administrative
proceedings, all of which management believes constitute ordinary
routine litigation incident to the business conducted by the
Company, or are not material in amount.
Page 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF RESULTS OF OPERATIONS
AND FINANCIAL CONDITION
RESULTS OF OPERATIONS
Net sales
Net sales for the quarter ending September 28, 1996 were 175.1
million, an increase of 22.3% from 143.6 million in the quarter
ended September 30, 1995. The net sales increase was primarily
the result of a 8.9% increase in average selling prices and a
12.5% increase in pounds of broiler products sold. Broiler market
prices for the quarter ended September 28, 1996 increased as
compared to the same quarter last year due to the slowdown in
industry expansion and the continuation of strong export sales.
The increase in broiler pounds sold was due to the Siler City
acquisition in July 1996 and changes in product mix. During the
quarter ended September 28, 1996, the Company sold approximately
235.6 million pounds of broiler products as compared to 209.5
million in the comparable quarter a year ago.
Consolidated net sales include the net sales of Carolina Golden
Products Company, a consolidated partnership, which had net sales
of $48.5 million for the three months ended September 28, 1996 as
compared to $39.5 million for the comparable period a year ago.
The Company's food distribution facility in South Florida had net
sales of $9.0 million for the quarter ended September 28, 1996 as
compared to $7.0 million for the same period last fiscal year.
Cost of sales
Cost of sales, as a percentage of net sales, for the quarter
ended September 28, 1996 was 93.7%, as compared to 92.1% for the
quarter ended September 30, 1995. The increase in the percentage
relationship was primarily the result of the increase in feed
ingredient costs. The 12.5% increase in pounds sold during the
current quarter contributed to the dollar increase in cost of
sales. For the quarter ended September 28, 1996, feed ingredient
costs were approximately 33% higher than in the comparable
quarter a year ago. The increase in the percentage relationship
was partially offset by the increase in average selling prices.
During July - August 1996, market prices for feed grains
continued to increase to record highs due to the weather reduced
1995 crop, export demand and the reluctance of U.S. livestock and
poultry producers to significantly reduce animal numbers.
However, market prices for corn and soybeans since August 1996
have declined in anticipation of a substantial 1996 U.S.
harvest.
Selling, administrative, and general expenses
Selling, administrative and general expenses, as a percentage of
net sales, was 3.0% for the three months ended September 28,
1996 as compared to 3.6% for the comparable period last fiscal
year. The decrease in the percentage relationship was the result
of the growth in net sales and the decrease in litigation related
expenses.
Interest and other income
Interest expense for the three months ended September 28, 1996
was $256,000 as compared to $455,000 in the comparable period a
year ago. The decrease was due primarily to lower average
borrowings.
Page 7
Minority interest in partnership loss
Minority interest in partnership gain of $271,000 for the three
months ended September 28, 1996 represents Gold Kist Inc.'s 49%
prorata share of the Carolina Golden Products Company's loss.
For the comparable period last fiscal year, Gold Kist's prorata
share of the loss was $563,000. Earnings for the quarter ended
September 28, 1996 resulted from improved performance in further-
processing operations and higher average selling prices.
Earnings before income taxes
The Company had earnings before income taxes of $5.3 million for
the three months ended September 28, 1996 as compared to $6.4
million for the comparable quarter last fiscal year. The
decrease was due primarily to higher feed ingredient costs which
were partially offset by increased selling prices.
Income Taxes
The Company's combined Federal and state income tax rate was
37.8% for the quarter ended September 28, 1996 as compared to
37.3% for the same quarter a year ago.
LIQUIDITY AND CAPITAL RESOURCES
At September 28, 1996, working capital, the current ratio, and
shareholders' equity were $38.7 million, 1.63 to 1 and $107.5
million, respectively, as compared to $44.5 million, 2.14 to 1
and $104.4 million, respectively, at June 29, 1996. The
Company's ratio of long-term debt to total capitalization was
5.8% at September 28, 1996 as compared to 4.4% at June 29, 1996.
The Company has revolving credit facilities with two commercial
banks totaling $45.0 million, of which $1.8 million was
outstanding at September 28, 1996. Also, the Company has a $15.0
million short-term credit facility with Gold Kist of which $9.5
million was outstanding at September 28, 1996.
Net cash provided by operating activities of $3.3 million for the
three months ended September 28, 1996 resulted from net earnings
adjusted for noncash charges. Increased trade accounts receivable
and inventories at September 28, 1995 as compared to June 29,
1996 resulted from the acquisition of the Siler City, N.C.
operation in July 1996 and the impact of increased feed grain
prices on field inventories. Uses of cash for the current
quarter included $13.9 million in expenditures for property,
plant and equipment.
Additional capital improvements totaling $5.0 million were
approved for equipment necessary to produce chill-pak poultry
products at the Siler City, N.C. operation. The Company expects
capital expenditures of approximately $56.0 million for fiscal
1997.
Approximately 19% of the Company's net sales in the current
quarter were to one customer, a major retail grocery chain.
Management is unable to predict with any degree of certainty what
effect the loss of this major customer would have on future
results of operations and liquidity. However, the loss of the
customer would, in the opinion of management, adversely affect
results of operations if sales from the customer were not
replaced by comparable sales to other customers.
Page 8
Management believes existing cash, amounts available under
existing credit arrangements, and expected cash to be provided
from operations will be sufficient to maintain cash flows
adequate for the Company's growth and operational objectives
during fiscal 1997.
PART II: OTHER INFORMATION
Item 1. Legal Proceedings.
In January 1993, certain Alabama member patrons of Gold
Kist Inc. filed a lawsuit in the Circuit Court of Jefferson
County, Alabama, Tenth Judicial Circuit against the Company
and Gold Kist Inc. and certain directors and officers of the
companies. (Ronald Pete Windham and Windham Enterprises,
Inc. on their behalf and on behalf of and for the use and
benefit of Gold Kist, Inc. and its shareholders/members v.
Harold O. Chitwood, individually in his capacity as an
officer of Gold Kist and a Director of Golden Poultry; et
al). The lawsuit alleged that the named defendants violated
their fiduciary duties by diverting corporate opportunities
from Gold Kist to the Company and Carolina Golden Products
Company in connection with the creation of the Company and
Carolina Golden Products Company and by permitting their
continued operations. Among the remedies requested are the
transfer of the Company's operations to Gold Kist. In March
1994, the Court certified the Windham litigation as a class
action. In September 1995, the Company and Carolina Golden
Products Company were dismissed from the litigation. On
October 25, 1995, the jury in the Windham case returned
verdicts in favor of the plaintiffs in the litigation. On
July 2, 1996, the Jefferson County, Alabama Circuit Court
Judge entered a memorandum opinion and non-final judgment in
the case directing Gold Kist to acquire the approximately
27% of the Company shares currently owned by investors so
that all of the issued and outstanding stock of the Company
would be owned by Gold Kist or a wholly owned subsidiary,
either through a merger or a tender offer for the minority
shares of the Company stock outstanding. Upon motions for
reconsideration filed by both parties to the action, the
Court modified its memorandum opinion in a Final Judgment
and Decree entered upon September 13, 1996, which was
clarified and reaffirmed by order of the Court dated
November 4, 1996, under which Gold Kist was relieved of the
Court's requirement to acquire all of the shares of Company
common stock not owned by Gold Kist and was directed to
acquire only that Company stock held by any current officers
or directors of Gold Kist and their spouses and minor
children. The Court also ordered Gold Kist to cause the
surrender of all Golden Poultry stock options held by Gold
Kist officers and directors or the exercise of such options
and purchase by Gold Kist of the resultant stock, to redeem
certain outstanding notified equity of Gold Kist, to pay
$4.2 million in attorney's fees to the plaintiffs attorneys
and to establish a policy prohibiting officers and directors
of Gold Kist from future ownership of Golden Poultry stock.
The Company is also party to various legal and
administrative proceedings, all of which management believes
constitute ordinary routine litigation incident to the
business conducted by the Company, or are not material in
amount.
Page 9
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibit
Designation of Exhibit
in this Report Description of Exhibit
4 (h) $25,000,000 Master Note
dated August 19, 1996
with Wachovia Bank of
Georgia, N.A.
27 Financial Data Schedule
(b) Reports on Form 8-K. Golden Poultry has not filed any
reports on Form 8-K during the three months ended
September 28, 1996.
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.
GOLDEN POULTRY COMPANY INC.
(Registrant)
Date November 11, 1996
Kenneth N. Whitmire
Chief Executive Officer
Date November 11, 1996
Langley C. Thomas, Jr.
Chief Financial Officer
Page 9
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibit
Designation of Exhibit
in this Report Description of Exhibit
4 (h) $25,000,000 Master Note
dated August 19, 1996
with Wachovia Bank of
Georgia, N.A.
27 Financial Data Schedule
(b) Reports on Form 8-K. Golden Poultry has not filed any
reports on Form 8-K during the three months ended
September 28, 1996.
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.
GOLDEN POULTRY COMPANY, INC.
(Registrant)
Date November 11, 1996 /s/ Kenneth N. Whitmire
Kenneth N. Whitmire
Chief Executive Officer
Date November 11, 1996 /s/Langley C. Thomas, Jr.
Langley C. Thomas, Jr.
Chief Financial Officer
WACHOVIA
MASTER NOTE
Date August 19, 1996 $25,000,000
For Value Received, the undersigned (hereinafter called the
"Borrower"), hereby promises to pay on demand but not later
than the maturity date or dates determined as herein set forth
to the order of WACHOVIA BANK OF GEORGIA, N.A. (hereinafter
called the "Lender"), at its office where borrowed, the
principal sum of TWENTY-FIVE MILLION DOLLARS or the aggregate
unpaid principal sum of all advances which the Lender actually
makes hereunder to the Borrower, whichever amount is less,
together with interest in arrears payable on each Interest Due
Date (as hereinafter defined) at a rate computed on the basis
of a 360-day year for the actual number of days in each
interest period, determined as herein set forth.
Lender, at its sole discretion, is hereby authorized to make
advances under this Note upon telephonic or written communication
of a borrowing request from any person representing himself or
herself to be the Borrower or, in the event Borrower is a
partnership or corporation, a duly authorized officer or
representative of Borrower. At the time of each advance
hereunder, the Borrower and the Lender shall agree on the
maturity date for the payment of the principal amount of such
advance (in the absence of earlier demand), the interest rate for
such advance and the dates interest on such advance shall be
payable (the "Interest Due Dates"). The Lender or other holder
shall be and is hereby authorized by the Borrower to set forth
on the reverse side of this Note, or on an attachment hereto:
(1) the amount and date of each advance made hereunder; (2) the
maturity date of each such advance (absent earlier demand); (3)
the interest rate for each such advance; (4) the Interest Due
Dates for each such advance; and (5) each payment of principal
received thereon and the date of such payment; provided, however,
any such notation or the failure to make any such notation shall
not limit or otherwise affect the obligation of the Borrower
with respect to the repayment of all advances actually made
hereunder. In the event of a good faith dispute among the
parties to this Note as to rate, the rate shall be the Prime
Rate.
After this Note or any advance of this Note shall become due,
whether on demand or otherwise, the unpaid principal of this
Note shall bear interest at a rate per annum equal to 150% of
the Prime Rate, or if greater, 2% above the rate applicable prior
to the due date, not to exceed the maximum rate permitted by
applicable law. As used herein, "Prime Rate" refers to that
interest rate so denominated and set by the Lender from time to
time as an interest rate basis for borrowings. The Prime Rate is
one of several interest rate bases used by the Lender. The
Lender lends at rates above and below the Prime Rate. Changes in
the Prime Rate shall be effective as of the day of each such
change.
Advances made hereunder shall not be used to purchase or carry
margin stock, such terms having the same meanings used in
Regulation U of the Federal Reserve Board.
All payments of any advances hereunder shall be applied first
to accrued interest and then to principal.
The Borrower may prepay any advance hereunder prior to the
maturity date specified for such advance only with the consent
or upon the demand of the Lender.
No waiver by the Lender of any provision of this Note shall be
effective unless in writing. To the extent not prohibited by
law the Borrower hereby grants to the Lender and to such Lender's
Affiliates (as the case may be) a security interest in and
security title to and does hereby assign, pledge, transfer and
convey to Lender and to such Lender's Affiliates (as the case
may be) (i) all property of the Borrower of every kind or
description now or hereafter in the possession or control of the
Lender or of any of Lender's Affiliates, exclusive of any such
property in the possession or control of the Lender or Lender's
Affiliates as a fiduciary other than as agent, for any reason
including, without limitation, all cash, stock or other dividends
and all proceeds thereof, and all rights to subscribe
for securities incident thereto and any substitutions or
replacements for, or other rights in connection with, any of such
collateral and (ii) any balance or deposit accounts of the
Borrower, whether such accounts be general or special, or
individual or multiple party, and upon all drafts, notes, or
other items deposited for collection or presented for payment by
the Borrower with the Lender or the Lender's Affiliates (as the
case may be), exclusive of any such property in the possession or
control of the Lender or Lender's Affiliates as a fiduciary other
than as agent, and the Lender and the Lender's Affiliates (as the
case may be) may at any time, without demand or notice,
appropriate and apply any of such to the payment of any
indebtedness, obligations and liabilities of the Borrower to the
Lender or to any of Lender's Affiliates (as the case may be), now
existing or hereafter incurred or arising, whether or not due,
with the exception of indebtedness, obligations and liabilities
owing to any of Lender's Affiliates the constitute open-end
credit under, or are subject to, the disclosure requirements of
the Truth-In-Lending Act and Federal Reserve Board Regulation Z
or any applicable state consumer protection laws. As used
herein, "Lender's Affiliates" means any entity or entities now or
hereafter directly or indirectly controlled by Wachovia
Corporation or any successor thereto. All parties to this Note,
including makers, endorsers, sureties and guarantors, whether
bound by this or by separate instrument or agreement, shall be
jointly and severally liable for the indebtedness evidenced by
this Note and hereby (1) waive presentment for payment, demand,
protest, notice of nonpayment or dishonor and of protect and any
and all other notices and demands whatsoever; (2) consent that at
any time, or from time to time, payment of any sum payable under
this Note may be extended without notice, whether for a definite
or indefinite time; and (3) agree to remain liable until the
indebtedness evidenced hereby is paid in full irrespective of any
extension, modification or renewal. No conduct of the holder
shall be deemed a waiver or release of such liability, unless
the holder expressly releases such party in writing. In the
event the indebtedness evidenced hereby is collected by or
through an attorney, the holder shall be entitled to recover
reasonable attorneys' fees and all other costs and expenses of
collection. Time is of the essence. Notwithstanding the
statement of any specific maturity date for any specific advance
and the requirement for the payment of interest from time to
time, this Note is demand instrument and is due and payable
at any time without cause or reason and is not subject to the
terms of Sections 1-203 or 1-208 of the Uniform Commercial
Code of Georgia, as the same may be amended from time to time.
This Note shall evidence all advances and payments of
principal made hereunder until it is surrendered to the Borrower
by the Lender, and it shall continue to be used even though there
may be periods prior to such surrender when no amount of
principal or interest is owing hereunder.
This Note, and the rights and obligations of the parties
hereunder, shall be governed by and construed in accordance
with the laws of the State of Georgia.
IN WITNESS WHEREOF, the Borrower has executed this Note under
seal the day and year set forth above.
Witness: Borrower:
/s/ Jean B. Holbrook Golden Poultry Company, Inc.
Attest: By: /s/ Langley C. Thomas, Jr.
/s/ J. David Dyson Title: Treasurer & Chief Financial Officer
Title: Assistant Secretary
[Corporate Seal]
Wachovia Bank of Georgia, N.A.
[7244/S-1-D-4]
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER>1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-28-1996
<PERIOD-END> SEP-28-1996
<CASH> 3,704
<SECURITIES> 0
<RECEIVABLES> 27,915
<ALLOWANCES> 31
<INVENTORY> 62,031
<CURRENT-ASSETS> 100,178
<PP&E> 189,414
<DEPRECIATION> 102,580
<TOTAL-ASSETS> 191,499
<CURRENT-LIABILITIES> 61,436
<BONDS> 6,590
0
0
<COMMON> 65,464
<OTHER-SE> 42,046
<TOTAL-LIABILITY-AND-EQUITY> 191,499
<SALES> 175,700
<TOTAL-REVENUES> 175,823
<CGS> 164,689
<TOTAL-COSTS> 164,689
<OTHER-EXPENSES> 0
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</TABLE>
