__________________________________________________________________________
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 March 31, 1996
[ ] 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: 2-98277C
THE COLONEL'S INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
MICHIGAN 38-3262264
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
620 SOUTH PLATT ROAD, MILAN, MICHIGAN 48160
(Address of principal executive offices) (Zip code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (313) 439-4200
Securities registered pursuant to Section 12(g) of the Act: Common Stock,
$0.01 Par Value
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 the registrant's Common Stock, $0.01 par
value as of May 13, 1996: 24,177,830
__________________________________________________________________________
1
PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
The financial statements required under Item 1 are set forth in
Appendix A to this Report on Form 10-Q and are here incorporated by
reference.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
BACKGROUND
Effective December 31, 1995, Brainerd International, Inc. ("Brainerd")
merged (the "Merger") with and into The Colonel's International, Inc. (the
"Company"). The Company was the surviving corporation in the Merger.
Prior to the Merger, Brainerd had 677,830 shares of its common stock
outstanding and traded on the Nasdaq SmallCap Market (symbol BIRI).
Pursuant to the Merger, these shares were converted into the same number
of shares of common stock in the Company.
Also effective December 31, 1995, Brainerd Merger Corporation, a
Michigan corporation and a wholly owned subsidiary of Brainerd, merged with
and into The Colonel's, Inc. ("The Colonel's"). The Colonel's was the
surviving corporation in this merger. In consideration of this merger, the
Company issued 23,500,000 shares of its common stock to Donald J. Williamson
and Patsy L. Williamson, who were the sole shareholders in The Colonel's.
In addition, Brainerd transferred all of its operating assets to its newly
formed subsidiary, Brainerd International Raceway.
As a result of these transactions, the Company now has two wholly
owned subsidiaries: The Colonel's and Brainerd International Raceway.
For accounting purposes, the transaction was treated as a
recapitalization of the Company with the Company as the acquiror (a reverse
acquisition). The effective date of the Merger was December 31, 1995.
Therefore, the assets acquired and liabilities assumed are included in the
Company's balance sheet at December 31, 1995. The historical financial
statements prior to December 31, 1995 are those of the Company only and
do not include any operating results of Brainerd. Beginning January 1,
1996, the incomes of both The Colonel's and Brainerd International
Raceway are reflected and reported as combined income in the
consolidated income statement.
THE COLONEL'S, INC.
The Colonel's was organized in 1982 and began producing and selling
plastic bumpers and facias in 1983. By the start of 1996, The Colonel's
2
had grown through acquisitions, joint ventures, and normal expansion to two
manufacturing plants, four distribution warehouses and a network of
independent distributors that sell The Colonel's products throughout the
United States, Canada, Mexico, Puerto Rico, Bahamas, and the District of
Columbia. The start up of a new truck accessory division (the "Truck
Accessory Division") that will manufacture and sell pickup truck bedliners
and tail gate covers, and the formation of Brainerd International Raceway
as a subsidiary of the Company, represent efforts by the Company to begin
to diversify into other areas outside the automotive collision parts
industry.
The Colonel's designs, manufactures and distributes plastic bumpers,
facias, support beams and brackets for the automotive collision parts
industry. The Colonel's also purchases and resells replacement steel and
chrome bumpers, facias, header panels, steel bumpers, rebars, step bumpers,
paint, and body shop repair supplies through its distributors as
replacement collision parts for most domestic and imported automobiles and
light trucks.
The Colonel's is a leading domestic manufacturer of plastic
replacement bumpers and facias for the automotive and light truck after
market industry. The Colonel's competes with the original equipment
manufacturers ("OEMs"), other domestic and import manufacturers for the
aftermarket who offer new replacement bumpers, and the recycled and junk
yard industry who repairs and resells previously damaged or salvaged
automotive parts.
The Truck Accessory Division will sell new pickup truck bedliners,
tail gate covers, trim pieces, and other items and will compete in the
growing pickup truck and sport utility liner market. Newly installed
custom built equipment will make it one of the world's most modern
bedliner production plants. The Company believes that the Truck
Accessory Division can effectively compete in the market because it
has the ability to manufacture its own plastic sheet stock instead
of purchasing it from outside vendors and it has specialized tooling
with a dedicated mold for each part. The Company registered two patents
on this specialized tooling, which required extensive development.
The products of the Truck Accessory Division will be sold through a world
wide distributor network.
The Colonel's participates in the Certified Auto Parts Association
(CAPA) certification program. This independent association inspects and
promulgates guidelines that form strict standards for quality. CAPA works
closely with insurance carriers to relate their concerns and quality issues
to the manufacturing sector. The manufacturing sector places CAPA
certification stickers on each of the parts that have been tested and
certified. The serial number of the certification sticker is the means for
CAPA to trace the part back to it original manufacturer. A non-conforming
part may cause CAPA to call for an inspection of the part or facility and
may lead to the de-certification of that part or part lot. Any part that
3
is decertified has to start over with the certification process in order to
be re-certified. A CAPA catalogue is distributed quarterly listing all
certified and decertified parts or lots. Additionally, CAPA issues monthly
bulletins to keep everyone advised of the status of all the parts in its
program. Currently, The Colonel's has 202 applications that are certified
by CAPA. At the present time, CAPA only has a certification program for
the Reaction Injection Molding (RIM) process. It does not have a
certification program for the 56 parts made by the injection molding (IM)
process. It would be expected that once CAPA has incorporated this process
into its certification program that The Colonel's may spend resources for
certification of the parts it produces from the IM process.
The Colonel's competes mainly on quality, price and delivery. Prices
are driven by the pricing levels that the respective OEM is currently
charging. The Colonel's considers price adjustments whenever an OEM
changes its prices. The Colonel's made general price changes in September
1995 in an effort to stabilize market share and boost sales exposure. The
Colonel's believes that it can stay competitive with OEM pricing because of
its extensive distributor network, which allows it to bring products to
market with less cost or markup than the OEM. OEM price changes cannot be
anticipated and could have a major impact either favorably (price increase)
or unfavorably (price reduction) on The Colonel's competitive position.
The Colonel's produces consistent quality products using state of the
art, domestically made machinery, domestically engineered raw materials,
and local labor forces. The Colonel's proudly displays "Made in USA" on
all of its products, packaging materials, and literature. The
manufacturing process, plant and parts are checked and certified by an
independent quality agency (CAPA) to assure that parts meet or exceed
acceptable industry standards.
BRAINERD INTERNATIONAL RACEWAY, INC.
From the time of its formation in 1982, Brainerd has operated a motor
sports facility located approximately six miles northwest of Brainerd,
Minnesota. As of 1996, this facility is now operated by Brainerd
International Raceway, a subsidiary of the Company. Substantially all of
Brainerd International Raceway's revenues have been obtained from motor
sports racing events at the raceway. Historically, Brainerd International
Raceway has scheduled racing and other events to be held at the racetrack
during weekends in the months of May through September each year. However,
Brainerd International Raceway conducted a snowmobile racing event during
the 1994-1995 New Year's weekend.
While Brainerd International Raceway has scheduled approximately 35
events during each season, a limited number of the major spectator events
provide a substantial portion of Brainerd International Raceway's revenues
with one event, the Champion Auto Stores Nationals, having provided
approximately 56 percent of Brainerd International Raceway's operating
revenue for the past three years. Revenues from the major spectator events
4
are provided from the sale of admissions to the event, the sale of
concessions, and fees paid by the spectators and participants for camping
access on the grounds of Brainerd International Raceway. The receipt of
such revenues is affected by weather conditions. Even if an event is not
canceled due to rain or other adverse conditions, poor weather will reduce
the attendance and the sale of concessions.
In addition to spectator-related revenues, Brainerd International
Raceway receives: (i) sponsorship fees from businesses which promote their
products and services at Brainerd International Raceway; (ii) entry fees
from participants in the races and other events; and (iii) rent for use of
the track for private racing events, driving schools and the testing or
filming of motor vehicle operations.
COMBINED OPERATIONS
The Milan manufacturing plant is a 350,000 square foot facility (plus
a 45,000 square foot covered crane bay) situated on a 62 acre site on the
outskirts of Milan, Michigan. Milan is located approximately 10 miles
south of Ann Arbor, Michigan, 60 miles west of Detroit, and 25 miles
northwest of Toledo, Ohio. There is sufficient room to expand the physical
plant. The Milan plant manufactures the aftermarket bumper facias. This
facility is leased from a company owned by Donald and Patsy Williamson.
The new Owosso manufacturing facility occupies a 210,000 square foot
building located on 27 acres on the outskirts of Owosso, Michigan. Owosso is
located about 100 miles north west of Milan, Michigan and about 30 miles north
east of Lansing, Michigan. The building has power capacities exceeding
current use and would permit expansion if necessary. This plant manufactures
the truck accessories. It is leased from a company owned by Donald and Patsy
Williamson.
Brainerd International Raceway owns and operates a three mile race
track including a one-quarter mile drag strip located approximately six
miles northwest of Brainerd, Minnesota. The terrain of the 600 acre site
is slightly rolling hills and partially wooded. The track and various
roads are composed of blacktop. The Brainerd International Raceway
contains several buildings including a four-story tower containing twelve
executive viewing suites, a control tower, various single story buildings
containing concession stands, restrooms, and storage and service facilities
located throughout the property. The buildings are concrete or wood frame
and constructed for warm weather use only. Grandstand bleachers for
approximately 18,000 spectators are primarily located along the dragstrip.
LIQUIDITY AND CAPITAL RESOURCES
The Company's consolidated current assets were reduced from
$11,483,000 at December 31, 1995 to $11,298,000 at March 31, 1996. Current
5
liabilities were reduced from $15,026,000 in 1995 to $13,358,000 in the
first quarter of 1996. The improvement in working capital was due mainly
to the retirement of long-term debt and the reduction of trade accounts
payable. The Company's subsidiaries made all of their scheduled principal
and interest payments on their outstanding debt during the first quarter of
1996.
Accounts receivables increased from $2,292,000 at December 31, 1995 to
$3,076,000 at March 31, 1996. This increase is due largely to the
increased sales activity during this period and some customers opting not
to take early payment discounts and incentives for prompt payments.
Inventories decreased by $736,000 during the first quarter of 1996
because of above average sales levels. The Colonel's routinely attempts to
keep a minimum 60-day supply available to ship for each application. This
allows it to adjust its production rates in an orderly, controlled manner.
Inventory levels traditionally fall during the first quarter of each year
and are replenished by late summer.
Prepaid expenses increased in the first quarter of 1996 due to an
advance payment of $100,000 toward the rental of the Owosso building. In a
related party lease signed in October 1995, the landlord agreed to free
rent of the building for six months with rent of $20,000 per month starting
in May 1996. The advance payment represents five months' rent.
No significant new plant property and equipment was purchased during
the first quarter of 1996. The Company expects to sign permanent capital
leases to replace the interim leases for the remaining Truck Accessory
Division equipment before the end of the second quarter of 1996. Brainerd
International Raceway's recapitalized assets began to be depreciated in
1996 based on their average useful life at the time of acquisition.
Note receivables have dropped by $350,000 as a result of the repayment
of two notes receivable of $270,000 in the first quarter of 1996 and the
scheduled repayment of related party notes receivable. The Company has one
related party loan with a balance of $430,000 (at March 31, 1996) which is
performing and being paid back at $20,000 per month plus interest. The
Colonel's sold property during the year which was financed through note
receivables due the Company at year end. These were subsequently paid in
full in February 1996.
The Colonel's deposits on tools and machinery increased by $85,000 to
$4,842,000, at March 31, 1996 because of additional equipment purchased for
the start up of the Truck Accessory Division. The Company treats advance
deposits made toward machinery as separate from regular assets until the
equipment has been delivered, made operational, and placed "in service."
$1,600,000 of the above balance is for tools manufactured overseas.
Although the Company anticipates that such tooling will be delivered as
ordered, some risk of default by the manufacturers does exist.
6
As a result of the Merger, the value paid for Brainerd International
Raceway exceeded the value of the assets by $425,000. This excess has been
recorded as goodwill and will be amortized over 15 years.
OUTSTANDING LOANS
The Colonel's has a $4,500,000 line of credit secured by accounts
receivable and inventory with a term that expires in August 1996. The
Colonel's expects to negotiate a renewal with the current lending
institution. Interest is paid at prime on a monthly basis. The
outstanding balance on the line of credit was $3,900,000 at March 31, 1996.
Brainerd International Raceway has a $300,000 line of credit which is
secured by all of its assets, of which none was outstanding at March 31,
1996.
The Colonel's received new financing of $6,000,000 in April 1995,
under a facility which calls for payments of $200,000 in principal plus
interest on a monthly basis calculated at 1/2 percent over prime on the
outstanding balance. The loan is secured by machinery and equipment and
had a balance of $4,200,000 at March 31, 1996. If the need arose in the
future, the Company believes it could obtain additional financing using
these assets as collateral.
Brainerd International Raceway has a mortgage in the amount of
$525,000, which is secured by property. This loan requires quarterly
interest payments at 2 percent above prime and a single principal payment
of $50,000 per year through 2004.
The balance on the Colonel's mortgage of its former Owosso facility
was $1,200,000 at the end of the first quarter 1996.
The Colonel's entered into a capital lease to finance equipment for
the new Owosso location. The Colonel's leased $2,689,000 worth of that
equipment under a six-year agreement that calls for monthly payments of
$41,000 and includes an option for the Company to purchase the equipment
for $1.00 upon expiration of the lease term. That amount represents
principal and interest at 7.5 percent. The leases are collateralized by
the machinery. In addition, The Colonel's has also financed interim leases
in the amount of $2,087,000, which has been deposited with the machinery
manufacturers as advance payments. Upon final acceptance of the machinery
by The Colonel's, the leasing company will advance the remaining amount on
the machinery of $650,000. Once the equipment has been accepted and paid
for, The Colonel's will convert the interim leases to long-term capital
leases with similar terms.
RESULTS OF OPERATIONS
Revenues for The Colonel's were $9,900,000 for the first quarter
ending March 31, 1996 compared to $7,819,000 for the same period in 1995.
7
The growth in 1996 was primarily due to the fairly severe winter conditions
and extra sales efforts. In addition, The Colonel's continued to offer
free freight on truck load purchases. The Colonel's continues to
aggressively market its products through improved quality, services and
delivery. The Truck Accessory Division started marketing its products in
April of 1996. To date, the Truck Accessory Division has contributed
$5,000 in sales.
Cost of Sales have increased from 67 percent of sales for the first
quarter of 1995 to 71 percent for the same three months in 1996. Although
general economic levels of supplies and labor have increased over the past
year, The Colonel's is offsetting these by operating more efficiently. The
first quarter of 1996 was affected by the start up costs of the Truck
Accessory Division, which started production in mid January and has
steadily built up inventory. The costs associated with this start up are
$553,000. Without the costs relating to the Truck Accessory Division the
first quarter of 1996 cost of sales would have been 66 percent, an amount
comparable to the same period in 1995.
Gross profits are also affected by the start up costs from the Truck
Accessory Division. Gross profits for the three month period dropped from
33 percent in 1995 to 29 percent in 1996. The gross losses for Owosso of
approximately 4 percent will diminish in the second quarter because sales
for the Truck Accessory Division started in April 1996.
Selling and general and administrative expenses have significantly
decreased from $1,103,000 (14 percent of sales) for the first quarter 1995
to $1,089,000 (11 percent of sales) in the same period of 1996. This was
primarily due to the consolidation of the Flint sales office to Milan in
1995. The duplicated services that were performed at each site are in the
process of being eliminated and a reduction of registration costs from
first quarter 1995.
Interest expense increased by $255,000 over the same period last year,
due mainly to the addition of the new equipment leases (permanent and
interim) that the Company has for the Owosso facility.
To date, the Company has accrued $481,000 for income taxes, which
reflects the Company's expected effective tax rate of 35 percent.
SUBSEQUENT EVENTS
The Colonel's entered into a lease for a fifth warehouse in Totawa,
New Jersey. The lease, which was signed in April 1996, is for three years
and covers 25,000 square feet. This lease will operate in a manner similar
to the warehouses that exist in Dallas, Houston, Phoenix, and West Memphis.
The Company drew an additional $244,000 toward the Owosso interim
leases in April 1996.
8
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
During the first quarter of 1996, there were no material
developments in legal proceedings involving the Company or its
subsidiaries. These proceedings were described in the Company's Annual
Report on Form 10-K for the year ended December 31, 1995.
ITEM 6. EXHIBITS AND REPORTS ON FORM 10-K.
(a) EXHIBITS. The following documents are filed as exhibits to this
report on Form 10-Q:
2.1 Agreement and Plan of Merger between The Colonel's, Inc. and
Brainerd Merger Corporation and joined in by Brainerd
International, Inc. Incorporated by reference from Exhibit A to
the Proxy Statement of Brainerd International, Inc. for the
Annual Meeting of Shareholders of Brainerd International, Inc.
held on November 21, 1995.
2.2 Agreement and Plan of Reorganization among Brainerd
International, Inc. and The Colonel's Holdings, Inc. Incorporated
by reference from Exhibit D to the Proxy Statement of Brainerd
International, Inc. for the Annual Meeting of Shareholders of
Brainerd International, Inc. held on November 21, 1995.
3.1 Articles of Incorporation of the Company, as amended.
Incorporated by reference from Exhibit E to the Proxy Statement
of Brainerd International, Inc. for the Annual Meeting of
Shareholders of Brainerd International, Inc. held on November 21,
1995.
3.2 Certificate of Amendment to the Articles of Incorporation
changing name from "The Colonel's Holdings, Inc." to "The
Colonel's International, Inc." Incorporated by reference from
Exhibit 3.2 to the Registrant's Report on Form 10-K for the
fiscal year ended December 31, 1995.
3.3 Bylaws of the Company. Incorporated by reference from Exhibit F
to the Proxy Statement of Brainerd International, Inc. for the
Annual Meeting of Shareholders of Brainerd International, Inc.
held on November 21, 1995.
4.1 Articles of Incorporation. See Exhibit 3.1 above.
9
10.1 The Company's 1995 Long-Term Incentive Plan. Incorporated by
reference from Exhibit G to the Proxy Statement of Brainerd
International, Inc. for the Annual Meeting of Shareholders of
Brainerd International, Inc. held on November 21, 1995.
10.2 Incentive Stock Option Plan. Incorporated by reference from the
Annual Report on Form 10-K of Brainerd International Inc. for the
fiscal year ended December 31, 1987.
10.3 Form of Non-Statutory Stock Option Agreement used under the
Incentive Stock Option Plan. Incorporated by reference from the
Annual Report on Form 10-K of Brainerd International Inc. for the
fiscal year ended December 31, 1987.
10.4 Form of Incentive Stock Option Agreement used under the Incentive
Stock Option Plan. Incorporated by reference from the Annual
Report on Form 10-K of Brainerd International Inc. for the fiscal
year ended December 31, 1987.
10.5 Office Lease Agreement dated January 23, 1991 between Brainerd
International, Inc. and Woodland Office Partnership.
Incorporated by reference from the Annual Report on Form 10-K of
Brainerd International Inc. for the fiscal year ended December
31, 1990.
10.6 Amendment dated December 11-12, 1991 to Office Lease Agreement
(see Exhibit 10(e) above) between Brainerd International, Inc.
and Woodland Office Partnership. Incorporated by reference from
Brainerd International, Inc.'s Annual Report on Form 10-K for the
fiscal year ended December 31, 1991.
10.7 $404,700 Promissory Note dated January 1, 1992, from Brainerd
International, Inc. payable to Gene Snow and James W. Littlejohn.
Incorporated by reference from Brainerd International, Inc.'s
Annual Report on Form 10-K for the fiscal year ended December 31,
1991.
10.8 Lease Agreement between Issuer and National Hot Rod Association,
Inc. consisting of March 17, 1984 Lease Agreement; April 28, 1986
letter extending term to 1991; March 12, 1987 Letter of
Amendment; and April 7, 1992 letter extending term to 1996 and
amending agreement. Incorporated by reference from Brainerd
International, Inc.'s Registration Statement on Form S-1
(Registration No. 33-055876).
10.9 November 8, 1988 Sponsorship Agreement between Champion Auto
Stores, Inc. and National Hot Rod Association, Inc. Incorporated
by reference from Brainerd International, Inc.'s Registration
Statement on Form S-1 (Registration No. 33-055876).
10
10.10 June 22, 1992 Title Rights Sponsorship Agreement between Champion
Auto Stores, Inc. and National Hot Rod Association, Inc.
Incorporated by reference from Brainerd International, Inc.'s
Registration Statement on Form S-1 (Registration No. 33-055876).
10.11 February 16, 1994 Loan Agreement with American National Bank of
Brainerd; $550,000 Promissory Note; and $300,000 Line of Credit
Note. Incorporated by reference from Brainerd International,
Inc.'s Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1993.
10.12 December 21, 1993 Agreement among Issuer, Motor Stadium, Inc. and
Gene M. Snow providing for termination of March 23, 1993
Financing Agreement, dissolution of Motor Sports Stadium, Inc.
and grant of interest by Mr. Snow in potential future project.
Incorporated by reference from Brainerd International, Inc.'s
Annual Report on Form 10-KSB for the fiscal year ended December
31, 1993.
10.13 Amendment dated February 1, 1994 to Office Lease Agreement (See
Exhibits 10(e) and 10(f)). Incorporated by reference from
Brainerd International, Inc.'s Annual Report on Form 10-KSB for
the fiscal year ended December 31, 1993.
10.14 September 1994 Stock Purchase Agreement among Gene M. Snow, James
W. Littlejohn and Donald J. Williamson. Incorporated by
reference from Brainerd International, Inc.'s Annual Report on
Form 10-KSB for the fiscal year ended December 31, 1993.
10.15 December 1994 Letter of Intent between Issuer and The Colonel's,
Inc. Incorporated by reference from Brainerd International,
Inc.'s Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1993.
10.16 Addendum to Lease dated December 16, 1994 (See Exhibits 10(e),
10(f) and 10(m)). Incorporated by reference from Brainerd
International, Inc.'s Annual Report on Form 10-KSB for the fiscal
year ended December 31, 1993.
10.17 Variable Rate-Installment Note ($6,000,000) between The Colonel's
and Comerica Bank dated April 14, 1995. Incorporated by reference
from Amendment No. 1 to Brainerd International, Inc.'s
Registration Statement on Form S-4 (Registration No. 33-91374).
10.18 Master Revolving Note ($4,500,000) between The Colonel's and
Comerica Bank dated May 1, 1995. Incorporated by reference from
Amendment No. 1 to Brainerd International, Inc.'s Registration
Statement on Form S-4 (Registration No. 33-91374).
11
10.19 Security Agreement between The Colonel's and Comerica Bank (f/k/a
Manufacturers National Bank of Detroit) dated December 4, 1991.
Incorporated by reference from Amendment No. 1 to Brainerd
International, Inc.'s Registration Statement on Form S-4
(Registration No. 33-91374).
10.20 Amended and Restated Security Agreement between The Colonel's and
Comerica Bank (f/k/a Manufacturers National Bank of Detroit)
dated December 4, 1991. Incorporated by reference from Amendment
No. 1 to Brainerd International, Inc.'s Registration Statement on
Form S-4 (Registration No. 33-91374).
10.21 Amended and Restated Guaranty between Donald and Patsy Williamson
and Comerica Bank dated October 8, 1992. Incorporated by
reference from Amendment No. 1 to Brainerd International, Inc.'s
Registration Statement on Form S-4 (Registration No. 33-91374).
10.22 Lease Agreement between 620 Platt Road, Inc. and The Colonel's
dated June 18, 1993 (for Milan, Michigan manufacturing facility).
Incorporated by reference from Amendment No. 1 to Brainerd
International, Inc.'s Registration Statement on Form S-4
(Registration No. 33-91374).
10.23 First Amendment to Lease Agreement between 620 Platt Road, L.L.C.
(f/k/a 620 Platt Road, Inc.) and The Colonel's dated June 16,
1995. Incorporated by reference from Amendment No. 1 to Brainerd
International, Inc.'s Registration Statement on Form S-4
(Registration No. 33-91374).
10.24 Industrial/Warehouse Lease between JMB/Warehouse Associates
Limited Partnership and The Colonel's dated August 1, 1993 (for
Houston, Texas warehouse distribution facility). Incorporated by
reference from Amendment No. 1 to Brainerd International, Inc.'s
Registration Statement on Form S-4 (Registration No. 33-91374).
10.25 Lease Agreement between Industrial Properties Corporation and The
Colonel's dated September 15, 1992 (for Dallas, Texas warehouse
distribution facility). Incorporated by reference from Amendment
No. 1 to Brainerd International, Inc.'s Registration Statement on
Form S-4 (Registration No. 33-91374).
10.26 Standard Industrial Lease between Revco D.S., Inc. and The
Colonel's dated February 5, 1993 (for Phoenix (Glendale), Arizona
warehouse distribution facility). Incorporated by reference from
Amendment No. 1 to Brainerd International, Inc.'s Registration
Statement on Form S-4 (Registration No. 33-91374).
10.27 Interim Equipment Lease Schedule ($2,729,370) between The
Colonel's and Comerica Leasing Corporation dated July 27, 1995.
Incorporated by reference from Amendment No. 2 to Brainerd
12
International, Inc.'s Registration Statement on Form S-4
(Registration No. 33-91374).
10.28 Interim Equipment Lease Schedule ($2,044,000) between The
Colonel's and Comerica Leasing Corporation dated July 27, 1995.
Incorporated by reference from Amendment No. 2 to Brainerd
International, Inc.'s Registration Statement on Form S-4
(Registration No. 33-91374).
10.29 Interim Equipment Lease Schedule ($383,468) between The Colonel's
and Comerica Leasing Corporation dated July 27, 1995.
Incorporated by reference from Amendment No. 2 to Brainerd
International, Inc.'s Registration Statement on Form S-4
(Registration No. 33-91374).
10.30 Lease Schedule ($3,464,557) between The Colonel's, Inc. and
Comerica Leasing Corporation dated December 27, 1995.
Incorporated by reference from Exhibit 10.30 to the Registrant's
Report on Form 10-K for the fiscal year ended December 31, 1995.
10.31 Interim Lease Schedule ($960,000) between The Colonel's, Inc. and
Comerica Leasing Corporation dated December 27, 1995.
Incorporated by reference from Exhibit 10.31 to the Registrant's
Report on Form 10-K for the fiscal year ended December 31, 1995.
10.32 Interim Lease Schedule ($542,811) between The Colonel's, Inc. and
Comerica Leasing Corporation dated December 27, 1995.
Incorporated by reference from Exhibit 10.32 to the Registrant's
Report on Form 10-K for the fiscal year ended December 31, 1995.
10.33 Interim Lease Schedule ($85,800) between The Colonel's, Inc. and
Comerica Leasing Corporation dated January 26, 1996.
Incorporated by reference from Exhibit 10.33 to the Registrant's
Report on Form 10-K for the fiscal year ended December 31, 1995.
10.34 Interim Lease Schedule ($52,556) between The Colonel's, Inc. and
Comerica Leasing Corporation dated February 16, 1996.
Incorporated by reference from Exhibit 10.34 to the Registrant's
Report on Form 10-K for the fiscal year ended December 31, 1995.
10.35 Interim Lease Schedule ($584,250) between The Colonel's, Inc. and
Comerica Leasing Corporation dated December 27, 1995.
Incorporated by reference from Exhibit 10.35 to the Registrant's
Report on Form 10-K for the fiscal year ended December 31, 1995.
10.36 Interim Lease Schedule ($364,650) between The Colonel's, Inc. and
Comerica Leasing Corporation dated January 26, 1996.
Incorporated by reference from Exhibit 10.36 to the Registrant's
Report on Form 10-K for the fiscal year ended December 31, 1995.
13
10.37 Interim Lease Schedule ($178,200) between The Colonel's, Inc. and
Comerica Leasing Corporation dated February 16, 1996.
Incorporated by reference from Exhibit 10.37 to the Registrant's
Report on Form 10-K for the fiscal year ended December 31, 1995.
11.1 Computation of Per Share Earnings.
27.1 Financial Data Schedule.
(b) REPORTS ON FORM 8-K. No reports on Form 8-K have been filed
during the quarter for which this report is filed.
14
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.
THE COLONEL'S INTERNATIONAL, INC.
Date: May 15, 1996 /S/ JEFFREY A. CHIMOVITZ
Vice President, Secertary and
General Counsel (Duly Authorized
Signatory for Registrant)
Date: May 15, 1996 /S/ RICHARD S. SCHOENFELDT
Vice President-Finance and
Chief Financial Officer
(Principal Financial Officer
and Duly Authorized Signatory for
Registrant)
15
APPENDIX A
<TABLE>
THE COLONEL'S INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
<CAPTION>
MAR 31 DEC 31
1996 1995
(UNAUDITED) (AUDITED)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash $ 492,642 $ 634,290
Accounts receivable:
Trade (net of allowance for doubtful accounts of 3,075,589 2,292,112
$401,200 and $434,600 at December 31, 1995
and March 31, 1996, respectively)
Inventories (Note 2) 6,069,880 6,805,906
Prepaid expenses 263,273 164,692
Notes receivable:
Related party 240,000 240,000
Other 12,669 302,401
Deferred taxes - current 1,017,000 917,000
Current portion of deferred compensation 52,000 52,000
Assets held for sale 75,000 75,000
Total current assets 11,298,053 11,483,401
PROPERTY, PLANT, AND EQUIPMENT - Net (Note 3) 20,251,048 20,876,669
OTHER ASSETS:
Notes receivable--Related Party 190,000 250,000
Long-term portion of deferred compensation 266,163 266,163
Deposits 4,841,981 4,757,342
Goodwill 425,609 425,609
Other 184,802 184,802
Total other assets 5,908,555 5,883,916
TOTAL ASSETS $37,457,656 $38,243,986
16
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable $ 3,900,000 $ 4,180,000
Current portion of long-term obligations 4,911,632 5,424,455
Accounts payable-trade 1,585,882 2,938,494
Accrued expenses (Note 4) 2,908,584 2,431,074
Current portion of deferred compensation 52,000 52,000
Total current liabilities 13,358,098 15,026,023
LONG-TERM OBLIGATIONS, NET OF CURRENT 6,044,498 6,064,705
PORTION (Note 5)
LONG-TERM PORTION OF DEFERRED COMPENSATION 266,163 266,163
DEFERRED TAXES - LONG-TERM 4,014,000 4,014,000
SHAREHOLDERS' EQUITY:
Common stock: 35,000,000 shares authorized at $0.01
par value, 24,177,830 shares issued and outstanding 241,778 241,778
Additional paid-in capital 5,557,833 5,557,833
Retained earnings 7,975,286 7,073,484
Total shareholders' equity 13,774,897 12,873,095
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $37,457,656 $38,243,986
</TABLE>
17
<TABLE>
THE COLONEL'S INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF INCOME
<CAPTION>
THREE MONTHS ENDING
MARCH 31
1996 1995
(UNAUDITED) (UNAUDITED)
<S> <C> <C>
SALES $9,900,074 $7,819,252
COST OF SALES 7,008,906 5,251,660
GROSS PROFIT 2,891,168 2,567,592
SELLING, GENERAL AND ADMINISTRATIVE 1,089,226 1,103,757
INCOME FROM OPERATIONS 1,801,942 1,463,835
OTHER INCOME (EXPENSE):
Interest expense (456,453) (201,351)
Interest income 31,570 59,194
Rental income 10,000 18,000
Other (4,257) 5,646
Other income (expense), net (419,140) (118,511)
NET INCOME BEFORE TAXES $1,382,802 $1,345,324
PROVISION FOR INCOME TAXES (Note 5) 481,000
NET INCOME $ 901,802 $1,345,324
EARNINGS PER SHARE (Note 6) $ 0.04
PRO FORMA EARNINGS
PER SHARE (Note 6) $ 0.04
</TABLE>
18
<TABLE>
THE COLONEL'S INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
THREE MONTHS ENDING
MARCH 31
1996 1995
(UNAUDITED) (UNAUDITED)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 901,802 $ 1,345,324
Adjustments to reconcile net income to net
cash provided by operations:
Depreciation 833,813 661,500
Change in Deferred Taxes (100,000)
Loss on sale of assets 5,255
Changes in assets and liabilities that provided
(used) cash:
Accounts receivable:
Trade (783,477) (90,526)
Related Parties 0 (272,418)
Insurance 0 4,352,239
Inventories 736,026 230,350
Prepaid expenses (98,581) 20,997
Accounts payable (1,352,612) 169,002
Accrued expenses 477,510 (81,974)
Net cash provided by operating activities 619,736 6,334,493
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for property, plant and equipment (232,947) (1,296,559)
Proceeds from sale of property, plant and equipment 19,500
Net change in deposits (principally for tooling
and equipment) (84,639) (123,200)
Additions to notes receivable-related party 0 (427,944)
Payments received on notes receivable - related party 60,000
Additions to notes receivable - other (770)
Payments received on notes receivable - other 290,502 57,971
Proceeds from sale of investments in affiliated companies 0
Net cash provided by investing activities 51,646 (1,780,937)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings (Payments) under notes payable (280,000) (1,050,000)
Proceeds from long-term obligations 75,000
Principal payments on long-term debt (560,435) (1,127,453)
Principal payment on obligations under capital leases (47,595)
19
Distributions paid to shareholders 0 (2,449,631)
Net cash used in financing activities (813,030) (4,627,084)
NET DECREASE IN CASH $ (141,648) $ (73,528)
CASH BEGINNING OF YEAR 634,290 164,286
CASH END OF PERIOD $ 492,642 $ 90,758
</TABLE>
20
THE COLONEL'S INTERNATIONAL, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Note 1 BASIS OF PRESENTATION
The financial information included herein is unaudited; however
such information reflects all adjustments (including normal
recurring adjustments) that are, in the opinion of management,
necessary for a fair presentation of the results of operations,
financial position and cash flows for the periods presented.
The results of operations for the three months ended March 31,
1996 are not necessarily indicative of the results expected for
the full year.
Note 2 INVENTORIES
Inventories are summarized as follows:
<TABLE>
<CAPTION>
MAR 31 DEC 31
1996 1995
<S> <C> <C> <C>
Finished products $5,257,865 $6,168,440
Raw materials 812,015 637,466
Total inventories 6,069,880 6,805,906
</TABLE>
Note 3 PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment is summarized by major classification as
follows:
<TABLE>
<CAPTION>
MAR 31 DEC 31
1996 1995
<S> <C> <C> <C>
Land and improvements $ 2,442,424 $ 2,269,400
Track 1,406,634 1,537,800
Buildings 1,172,860 622,000
Leasehold improvements 157,681 707,076
Bleachers & fencing 432,200 432,200
Equipment (including equipment
under capital lease) 10,497,586 10,460,954
Transportation equipment
(including equipment 724,824 609,097
under capital lease)
Furniture & fixtures 534,839 537,230
Tooling 19,658,447 19,658,447
21
Total 37,027,495 38,834,204
Less accumulated depreciation
and amortization (16,776,447) (15,957,535)
Net property, plant and
equipment 20,251,048 20,876,669
</TABLE>
Certain transfers were made between the classifications of
property, plant and equipment obtained from Brainerd to represent
the proper classification of these assets based on their useful
lives.
Note 4 ACCRUED EXPENSES
Accrued expenses consist of the following:
<TABLE>
<CAPTION>
MAR 31 DEC 31
1996 1995
<S> <C> <C> <C>
Accrued legal $ 308,207 $ 349,331
Accrued compensation for NuPar 900,000 900,000
Accrued environmental costs 598,717 598,717
Accrued federal income taxes 421,000 66,000
Accrued taxes 181,797 276,619
Other 498,863 420,407
Total $2,908,584 $2,431,074
</TABLE>
Note 5 INCOME TAXES
Effective December 31, 1995 The Colonel's, Inc. changed its tax
status from an "S" corporation to a "C" corporation. The
provision for income taxes reflects the Company's expected
estimated effective tax rate of approximately 35 percent.
Note 6 EARNINGS PER SHARE
The computation of earnings per share is based on the weighted
average number of shares of common stock outstanding the during
the three month period ended March 31, 1996. The proforma earnings
per share for the three month period ended March 1995 has been
calculated as if the Merger and the Company's change in tax status
had occurred on January 1, 1995.
Note 7 LITIGATION
A suit was filed against The Company in 1992 claiming The Company
violated anti-trust laws and alleging that The Company has
22
engaged in predatory pricing, monopolization and anti-competitive
acquisitions. Discovery has narrowed the plaintiffs' theories of
recoveries and the allegedly offending predatorily priced sales
at issue to only two bumper models of which fewer than 2,000
parts were sold during the relevant period. The Company has
offered to settle the dispute for $160,000. The Company has
accrued its best estimate of the cost of litigation based on
known facts. It is possible that this estimate may change in the
near term as the lawsuit progresses. Although the final
resolution of any such matters could have a material effect on
The Company's operating results for the particular reporting
period in which an adjustment of the estimated liability is
recorded, The Company believes that any resulting liability
should not materially affect its financial position.
The Company is involved in various other legal proceedings which
have arisen in the normal course of the operations. The Company
has accrued its best estimate of the cost of litigation based on
known facts. It is possible that this estimate may change in the
near term as the lawsuits progress. Although the final
resolution of any such matters could have a material effect on
The Company's operating results for the particular reporting in
which an adjustment of the estimated liability is recorded, The
Company believes that any resulting liability should not
materially affect its financial position.
Note 8 ENVIRONMENTAL REMEDIATION
The Company is responsible for the remediation of hazardous
materials and ground contamination located at the Owosso facility
as a result of the fire. In August 1993, the Michigan Department
of Natural Resources required that The Company perform a complete
hydrogeological study of the site to determine the extent of the
contamination. The Company plans to engage environmental
consultants in the summer of 1998 to determine the extent of the
hazardous materials located at this site, if any, and the cost of
any remediation. The Company has accrued its best estimate of
the cost of remediation based on known facts. It is possible
that this estimate may change in the near term as the project
progresses. Although the final resolution of any such matters
could have a material effect on The Company's operating results
for the particular reporting period in which an adjustment of the
estimated liability is recorded, The Company believes that any
resulting liability should not materially affect its financial
position.
As part of the lease agreement with a related party for the
Milan, Michigan facility, The Company is also responsible for the
remediation of hazardous material, up to an amount of $2,000,000,
23
which existed at this site prior to The Colonel's entering into
the lease in June 1993. The Company has accrued for estimated
remediation costs based on an environmental study of the site.
The Company has accrued its best estimate of the cost of
remediation based on known facts. It is possible that this
estimate may change in the near term as the project progresses.
Although the final resolution of any such matters could have a
material effect on The Company's operating results for the
particular reporting period in which an adjustment of the
estimated liability is recorded, The Company believes that any
resulting liability should not materially affect its financial
position.
24
EXHIBIT INDEX
2.1 Agreement and Plan of Merger between The Colonel's, Inc. and
Brainerd Merger Corporation and joined in by Brainerd International,
Inc. Incorporated by reference from Exhibit A to the Proxy
Statement of Brainerd International, Inc. for the Annual Meeting of
Shareholders of Brainerd International, Inc. held on November 21,
1995.
2.2 Agreement and Plan of Reorganization among Brainerd International,
Inc. and The Colonel's Holdings, Inc. Incorporated by reference from
Exhibit D to the Proxy Statement of Brainerd International, Inc. for
the Annual Meeting of Shareholders of Brainerd International, Inc.
held on November 21, 1995.
3.1 Articles of Incorporation of the Company, as amended. Incorporated
by reference from Exhibit E to the Proxy Statement of Brainerd
International, Inc. for the Annual Meeting of Shareholders of
Brainerd International, Inc. held on November 21, 1995.
3.2 Certificate of Amendment to the Articles of Incorporation changing
name from "The Colonel's Holdings, Inc." to "The Colonel's
International, Inc." Incorporated by reference from Exhibit 3.2 to
the Registrant's Report on Form 10-K for the fiscal year ended
December 31, 1995.
3.3 Bylaws of the Company. Incorporated by reference from Exhibit F to
the Proxy Statement of Brainerd International, Inc. for the Annual
Meeting of Shareholders of Brainerd International, Inc. held on
November 21, 1995.
4.1 Articles of Incorporation. See Exhibit 3.1 above.
10.1 The Company's 1995 Long-Term Incentive Plan. Incorporated by
reference from Exhibit G to the Proxy Statement of Brainerd
International, Inc. for the Annual Meeting of Shareholders of
Brainerd International, Inc. held on November 21, 1995.
10.2 Incentive Stock Option Plan. Incorporated by reference from the
Annual Report on Form 10-K of Brainerd International Inc. for the
fiscal year ended December 31, 1987.
10.3 Form of Non-Statutory Stock Option Agreement used under the
Incentive Stock Option Plan. Incorporated by reference from the
Annual Report on Form 10-K of Brainerd International Inc. for the
fiscal year ended December 31, 1987.
10.4 Form of Incentive Stock Option Agreement used under the Incentive
Stock Option Plan. Incorporated by reference from the Annual Report
on Form 10-K of Brainerd International Inc. for the fiscal year
ended December 31, 1987.
25
10.5 Office Lease Agreement dated January 23, 1991 between Brainerd
International, Inc. and Woodland Office Partnership. Incorporated
by reference from the Annual Report on Form 10-K of Brainerd
International Inc. for the fiscal year ended December 31, 1990.
10.6 Amendment dated December 11-12, 1991 to Office Lease Agreement (see
Exhibit 10(e) above) between Brainerd International, Inc. and
Woodland Office Partnership. Incorporated by reference from
Brainerd International, Inc.'s Annual Report on Form 10-K for the
fiscal year ended December 31, 1991.
10.7 $404,700 Promissory Note dated January 1, 1992, from Brainerd
International, Inc. payable to Gene Snow and James W. Littlejohn.
Incorporated by reference from Brainerd International, Inc.'s Annual
Report on Form 10-K for the fiscal year ended December 31, 1991.
10.8 Lease Agreement between Issuer and National Hot Rod Association,
Inc. consisting of March 17, 1984 Lease Agreement; April 28, 1986
letter extending term to 1991; March 12, 1987 Letter of Amendment;
and April 7, 1992 letter extending term to 1996 and amending
agreement. Incorporated by reference from Brainerd International,
Inc.'s Registration Statement on Form S-1 (Registration No. 33-055876).
10.9 November 8, 1988 Sponsorship Agreement between Champion Auto Stores,
Inc. and National Hot Rod Association, Inc. Incorporated by
reference from Brainerd International, Inc.'s Registration Statement
on Form S-1 (Registration No. 33-055876).
10.10 June 22, 1992 Title Rights Sponsorship Agreement between Champion
Auto Stores, Inc. and National Hot Rod Association, Inc.
Incorporated by reference from Brainerd International, Inc.'s
Registration Statement on Form S-1 (Registration No. 33-055876).
10.11 February 16, 1994 Loan Agreement with American National Bank of
Brainerd; $550,000 Promissory Note; and $300,000 Line of Credit
Note. Incorporated by reference from Brainerd International, Inc.'s
Annual Report on Form 10-KSB for the fiscal year ended December 31,
1993.
10.12 December 21, 1993 Agreement among Issuer, Motor Stadium, Inc. and
Gene M. Snow providing for termination of March 23, 1993 Financing
Agreement, dissolution of Motor Sports Stadium, Inc. and grant of
interest by Mr. Snow in potential future project. Incorporated by
reference from Brainerd International, Inc.'s Annual Report on Form
10-KSB for the fiscal year ended December 31, 1993.
10.13 Amendment dated February 1, 1994 to Office Lease Agreement (See
Exhibits 10(e) and 10(f)). Incorporated by reference from Brainerd
International, Inc.'s Annual Report on Form 10-KSB for the fiscal
year ended December 31, 1993.
26
10.14 September 1994 Stock Purchase Agreement among Gene M. Snow, James W.
Littlejohn and Donald J. Williamson. Incorporated by reference from
Brainerd International, Inc.'s Annual Report on Form 10-KSB for the
fiscal year ended December 31, 1993.
10.15 December 1994 Letter of Intent between Issuer and The Colonel's,
Inc. Incorporated by reference from Brainerd International, Inc.'s
Annual Report on Form 10-KSB for the fiscal year ended December 31,
1993.
10.16 Addendum to Lease dated December 16, 1994 (See Exhibits 10(e), 10(f)
and 10(m)). Incorporated by reference from Brainerd International,
Inc.'s Annual Report on Form 10-KSB for the fiscal year ended
December 31, 1993.
10.17 Variable Rate-Installment Note ($6,000,000) between The Colonel's
and Comerica Bank dated April 14, 1995. Incorporated by reference
from Amendment No. 1 to Brainerd International, Inc.'s Registration
Statement on Form S-4 (Registration No. 33-91374).
10.18 Master Revolving Note ($4,500,000) between The Colonel's and
Comerica Bank dated May 1, 1995. Incorporated by reference from
Amendment No. 1 to Brainerd International, Inc.'s Registration
Statement on Form S-4 (Registration No. 33-91374).
10.19 Security Agreement between The Colonel's and Comerica Bank (f/k/a
Manufacturers National Bank of Detroit) dated December 4, 1991.
Incorporated by reference from Amendment No. 1 to Brainerd
International, Inc.'s Registration Statement on Form S-4
(Registration No. 33-91374).
10.20 Amended and Restated Security Agreement between The Colonel's and
Comerica Bank (f/k/a Manufacturers National Bank of Detroit) dated
December 4, 1991. Incorporated by reference from Amendment No. 1 to
Brainerd International, Inc.'s Registration Statement on Form S-4
(Registration No. 33-91374).
10.21 Amended and Restated Guaranty between Donald and Patsy Williamson
and Comerica Bank dated October 8, 1992. Incorporated by reference
from Amendment No. 1 to Brainerd International, Inc.'s Registration
Statement on Form S-4 (Registration No. 33-91374).
10.22 Lease Agreement between 620 Platt Road, Inc. and The Colonel's dated
June 18, 1993 (for Milan, Michigan manufacturing facility).
Incorporated by reference from Amendment No. 1 to Brainerd
International, Inc.'s Registration Statement on Form S-4
(Registration No. 33-91374).
10.23 First Amendment to Lease Agreement between 620 Platt Road, L.L.C.
(f/k/a 620 Platt Road, Inc.) and The Colonel's dated June 16, 1995.
27
Incorporated by reference from Amendment No. 1 to Brainerd
International, Inc.'s Registration Statement on Form S-4
(Registration No. 33-91374).
10.24 Industrial/Warehouse Lease between JMB/Warehouse Associates Limited
Partnership and The Colonel's dated August 1, 1993 (for Houston,
Texas warehouse distribution facility). Incorporated by reference
from Amendment No. 1 to Brainerd International, Inc.'s Registration
Statement on Form S-4 (Registration No. 33-91374).
10.25 Lease Agreement between Industrial Properties Corporation and The
Colonel's dated September 15, 1992 (for Dallas, Texas warehouse
distribution facility). Incorporated by reference from Amendment
No. 1 to Brainerd International, Inc.'s Registration Statement on
Form S-4 (Registration No. 33-91374).
10.26 Standard Industrial Lease between Revco D.S., Inc. and The Colonel's
dated February 5, 1993 (for Phoenix (Glendale), Arizona warehouse
distribution facility). Incorporated by reference from Amendment
No. 1 to Brainerd International, Inc.'s Registration Statement on
Form S-4 (Registration No. 33-91374).
10.27 Interim Equipment Lease Schedule ($2,729,370) between The Colonel's
and Comerica Leasing Corporation dated July 27, 1995. Incorporated
by reference from Amendment No. 2 to Brainerd International, Inc.'s
Registration Statement on Form S-4 (Registration No. 33-91374).
10.28 Interim Equipment Lease Schedule ($2,044,000) between The Colonel's
and Comerica Leasing Corporation dated July 27, 1995. Incorporated
by reference from Amendment No. 2 to Brainerd International, Inc.'s
Registration Statement on Form S-4 (Registration No. 33-91374).
10.29 Interim Equipment Lease Schedule ($383,468) between The Colonel's
and Comerica Leasing Corporation dated July 27, 1995. Incorporated
by reference from Amendment No. 2 to Brainerd International, Inc.'s
Registration Statement on Form S-4 (Registration No. 33-91374).
10.30 Lease Schedule ($3,464,557) between The Colonel's, Inc. and Comerica
Leasing Corporation dated December 27, 1995. Incorporated by
reference from Exhibit 10.30 to the Registrant's Report on Form 10-K
for the fiscal year ended December 31, 1995.
10.31 Interim Lease Schedule ($960,000) between The Colonel's, Inc. and
Comerica Leasing Corporation dated December 27, 1995. Incorporated
by reference from Exhibit 10.31 to the Registrant's Report on Form
10-K for the fiscal year ended December 31, 1995.
10.32 Interim Lease Schedule ($542,811) between The Colonel's, Inc. and
Comerica Leasing Corporation dated December 27, 1995. Incorporated
by reference from Exhibit 10.32 to the Registrant's Report on Form
10-K for the fiscal year ended December 31, 1995.
28
10.33 Interim Lease Schedule ($85,800) between The Colonel's, Inc. and
Comerica Leasing Corporation dated January 26, 1996. Incorporated
by reference from Exhibit 10.33 to the Registrant's Report on Form
10-K for the fiscal year ended December 31, 1995.
10.34 Interim Lease Schedule ($52,556) between The Colonel's, Inc. and
Comerica Leasing Corporation dated February 16, 1996. Incorporated
by reference from Exhibit 10.34 to the Registrant's Report on Form
10-K for the fiscal year ended December 31, 1995.
10.35 Interim Lease Schedule ($584,250) between The Colonel's, Inc. and
Comerica Leasing Corporation dated December 27, 1995. Incorporated
by reference from Exhibit 10.35 to the Registrant's Report on Form
10-K for the fiscal year ended December 31, 1995.
10.36 Interim Lease Schedule ($364,650) between The Colonel's, Inc. and
Comerica Leasing Corporation dated January 26, 1996. Incorporated
by reference from Exhibit 10.36 to the Registrant's Report on Form
10-K for the fiscal year ended December 31, 1995.
10.37 Interim Lease Schedule ($178,200) between The Colonel's, Inc. and
Comerica Leasing Corporation dated February 16, 1996. Incorporated
by reference from Exhibit 10.37 to the Registrant's Report on Form
10-K for the fiscal year ended December 31, 1995.
11.1 Computation of Per Share Earnings.
27.1 Financial Data Schedule.
29
EXHIBIT 11.1
A statement of computation of per share earnings can be found
in Note 6 to the financial statements contained in Appendix A to
this Report on Form 10-Q.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE CONSOLIDATED STATEMENT OF INCOME, BALANCE SHEETS, AND
STATEMENT OF CASH FLOWS OF THE COLONEL'S INTERNATIONAL, INC. AND
ITS SUBSIDIARIES AS OF AND FOR THE QUARTER ENDED MARCH 31, 1996
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 492,642
<SECURITIES> 0
<RECEIVABLES> 3,075,589
<ALLOWANCES> (434,600)
<INVENTORY> 6,069,880
<CURRENT-ASSETS> 11,298,053
<PP&E> 37,027,495
<DEPRECIATION> (16,776,447)
<TOTAL-ASSETS> 37,457,656
<CURRENT-LIABILITIES> 13,358,098
<BONDS> 0
<COMMON> 241,778
0
0
<OTHER-SE> 13,533,119
<TOTAL-LIABILITY-AND-EQUITY> 37,457,656
<SALES> 9,900,074
<TOTAL-REVENUES> 9,900,074
<CGS> 7,008,906
<TOTAL-COSTS> 7,008,906
<OTHER-EXPENSES> 1,089,226
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (456,453)
<INCOME-PRETAX> 1,382,802
<INCOME-TAX> 481,000
<INCOME-CONTINUING> 901,802
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 901,802
<EPS-PRIMARY> 0.04
<EPS-DILUTED> 0
</TABLE>
