<TABLE>
<CAPTION>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) MAY 9, 2000
--------------
<S> <C>
BERRY PLASTICS CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
Delaware 33-75706 35-1813706
(STATE OR OTHER JURISDICTION (COMMISSION (IRS EMPLOYER
OF INCORPORATION) FILE NUMBER) IDENTIFICATION NO.)
BPC HOLDING CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 35-1814673
<S> <C>
(State or other jurisdiction (IRS employer
of incorporation or organization) identification number)
BERRY IOWA CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 42-1382173
<S> <C>
(State or other jurisdiction (IRS employer
of incorporation or organization) identification number)
BERRY TRI-PLAS CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 56-1949250
<S> <C>
(State or other jurisdiction (IRS employer
of incorporation or organization) identification number)
BERRY STERLING CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 54-1749681
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
AEROCON, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 35-1948748
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
PACKERWARE CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 48-0759852
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
BERRY PLASTICS DESIGN CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 62-1689708
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
VENTURE PACKAGING, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 51-0368479
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
VENTURE PACKAGING MIDWEST, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 34-1809003
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
VENTURE PACKAGING SOUTHEAST, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 57-1029638
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
NIM HOLDINGS LIMITED
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
England and Wales N/A
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
BERRY PLASTICS U.K. LIMITED
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
England and Wales N/A
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
KNIGHT PLASTICS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 35-2056610
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
CPI HOLDING CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 34-1820303
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
CARDINAL PACKAGING, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Ohio 34-1396561
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
NORWICH ACQUISITION LIMITED
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
England and Wales N/A
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
POLY-SEAL CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 52-0892112
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
BERRY PLASTICS ACQUISITION CORPORATION II
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware N/A
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
BERRY PLASTICS ACQUISITION CORPORATION III
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware N/A
<S> <C>
(STATE OR OTHER JURISDICTION (IRS EMPLOYER
OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
101 Oakley Street
Evansville, Indiana 47710
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
Registrant's telephone number, including area code (812) 424-2904
---------------
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
</TABLE>
<PAGE>
AMENDMENT NO. 1
The undersigned registrant hereby amends the following items, financial
statements, exhibits or other portions of its Current Report on Form 8-K, Date
of Report May 9, 2000, and filed May 24, 2000, as set forth in the pages
attached hereto:
ITEM 7 (A) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED
Audited Consolidated Financial Statements of Poly-Seal Corporation and
Subsidiaries as of December 31, 1999 and 1998 and for the years ended
December 31, 1999, 1998 and 1997
Independent Auditors' Report of Ellin & Tucker, Chartered
Consolidated Balance Sheets
Consolidated Statements of Operations
Consolidated Statements of Stockholders' Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
Unaudited Consolidated Financial Statements of Poly-Seal Corporation and
Subsidiaries as of May 9, 2000 and for the period from January 1, 2000
to May 9, 2000:
Consolidated Balance Sheets
Consolidated Statements of Operations
Consolidated Statements of Cash Flows
Note to Consolidated Financial Statements
ITEM 7 (B) PRO FORMA FINANCIAL INFORMATION
Pro Forma Unaudited Condensed Consolidated Financial Statements of BPC
Holding Corporation:
Pro Forma Unaudited Condensed Consolidated Balance Sheets as of
April 1, 2000
Notes to Pro Forma Unaudited Condensed Consolidated Balance Sheets
as of April 1, 2000
Pro Forma Unaudited Condensed Consolidated Statements of Operations
for the fiscal year ended January 1, 2000
Notes to Pro Forma Unaudited Condensed Consolidated Statements of
Operations for the fiscal year ended January 1, 2000
Pro Forma Unaudited Condensed Consolidated Statements of Operations
for the three months ended April 1, 2000
Notes to Pro Forma Unaudited Condensed Consolidated Statements of
Operations for the three months ended April 1, 2000
UNAUDITED PRO FORMA FINANCIAL INFORMATION OF BERRY PLASTICS
CORPORATION
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors of
Poly-Seal Corporation
We have audited the accompanying Consolidated Balance Sheets of Poly-Seal
Corporation and Subsidiaries as of December 31, 1999 and 1998, and the related
Consolidated Statements of Operations, Stockholders' Equity, and Cash Flows for
the years ended December 31, 1999, 1998 and 1997. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Poly-Seal
Corporation and Subsidiaries as of December 31, 1999 and 1998, and the results
of their operations and their cash flows for the years ended December 31, 1999,
1998 and 1997 in conformity with generally accepted accounting principles.
/s/ ELLIN & TUCKER, CHARTERED
ELLIN & TUCKER, CHARTERED
Certified Public Accountants
Baltimore, Maryland
February 22, 2000
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 1999 AND 1998
<TABLE>
<CAPTION>
ASSETS
------ 1999 1998
-------------- --------------
<S> <C> <C> <C>
CURRENT ASSETS:
---------------
Cash and Cash Equivalents $ 3,002,012 $ 618,544
Investments (Note 2) 21,260 21,260
Accounts Receivable, Net of allowance for Doubtful
Accounts of $190,000 and $115,000 6,169,703 6,645,697
Inventories (Note 3) 8,685,662 8,105,224
Income taxes Receivable - 352,115
Prepaid Expenses and Other Current Assets 324,615 419,614
Note Receivable (Note 10) 1,850,000 -
Deferred Income Taxes (Note 8) 227,319 733,179
-------------- --------------
Total current assets 20,280,571 16,895,633
PROPERTY, PLANT, AND EQUIPMENT, AT
COST - NET (Note 4) 19,454,513 20,591,173
-------------- --------------
OTHER ASSETS:
-------------
Note Receivable (Note 10) - 1,850,000
Advance Payments on Purchases of Property and
Equipment 2,554,518 1,428,117
Other Assets (Note 9) 893,322 820,891
Goodwill 355,000 415,000
-------------- --------------
Total Other Assets 3,802,840 4,514,008
-------------- --------------
Total Assets $ 43,537,924 $ 42,000,814
============== ==============
(SEE INDEPENDENT AUDITORS' REPORT AND ACCOMPANYING NOTES)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
<S> <C> <C> <C>
1999 1998
-------------- --------------
CURRENT LIABILITIES:
--------------------
Accounts Payable $ 2,364,146 $ 2,785,245
Accrued Expenses 1,735,000 2,443,356
Income Taxes Payable 99,112 -
Current Maturities of Long-Term Debt (Note 7) 800,000 800,000
-------------- --------------
Total current liabilities 4,998,258 6,028,601
LONG-TERM DEBT (Note 7) 3,283,333 4,083,333
DEFERRED INCOME TAXES (Note 8) 2,177,428 1,865,922
-------------- --------------
Total Liabilities 10,459,019 11,977,856
-------------- --------------
COMMITMENTS (Note 14)
STOCKHOLDERS' EQUITY (NOTE 5):
------------------------------
Common Stock; $.005 Par Value; Authorized
1,500,000 Shares; Issued 1,215,400 Shares;
Outstanding 1,051,578 and 1,042,078 Shares 6,077 6,077
Additional Paid-in Capital 7,247,150 7,148,938
Additional Paid-in Capital - Stock Options 97,001 91,389
Retained Earnings 29,055,638 26,170,243
Notes Receivable (120,385) -
Treasury Stock, at Cost; 163,822 and 173,322 Shares (3,206,576) (3,393,689)
-------------- --------------
Total Stockholders' Equity 33,078,905 30,022,958
-------------- --------------
Total Liabilities and Stockholders' Equity $ 43,537,924 $ 42,000,814
============== ==============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
POLY-SEAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
------------------------------------------
1999 1998 1997
------------------------------------------
<S> <C> <C> <C> <C>
NET SALES $ 49,828,139 $48,384,657 $49,751,529
COST OF SALES 37,438,877 40,861,014 40,793,104
------------------------------------------
Gross Profit 12,389,262 7,523,643 8,958,425
SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES 7,248,037 7,546,893 7,603,633
------------------------------------------
Income (Loss) from Operations 5,141,225 (23,250) 1,354,792
------------------------------------------
OTHER INCOME (EXPENSE):
Interest Expense (290,091) (338,142) (230,554)
Restructuring and Idle Facility Expenses (Note 10) - (514,289) (1,491,890)
Gain (Loss) on Disposal of Property, Plant, and
Equipment (Note 10) (10,229) 222,400 737,076
Shut Down Costs (Note 11) - (455,974) -
Unusual Expenses (Note 12) (152,417) - -
Other Income - Net 464,433 367,916 184,277
------------------------------------------
Total Other Income (Expense) 11,696 (718,089) (801,091)
------------------------------------------
Income (Loss) Before Income Taxes 5,152,921 (741,339) 553,701
INCOME TAX (BENEFIT) EXPENSE (Note 8) 2,017,427 (285,495) 224,127
------------------------------------------
Net Income (Loss) $ 3,135,494 $ (455,844) $329,574
============= ============ =========
</TABLE>
(See Independent Auditors' Report and Accompanying Notes)
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
<TABLE>
<CAPTION>
COMMON STOCK
--------------------
ADDITIONAL
ADDITIONAL PAID-IN UNEARNED
NUMBER PAID-IN CAPITAL- PORTION OF
OF CAPITAL STOCK
SHARES AMOUNT OPTIONS
-------------------------------------------
<S> <C> <C> <C> <C> <C>
BALANCE AT January 1, 1997, AS 1,215,400 $ 6,077 $7,794,739 $ -
PREVIOUSLY REPORTED
Cumulative Effect on Prior
Years of Retroactive
Restatement for
Accounting Change (Note 1) - - - -
Prior Period Adjustment (Note 16) - - - -
------------------------------------------
BALANCE AT JANUARY 1, 1997, AS 1,215,400 6,077 7,794,739 -
RESTATED
Purchase of 25,150 Shares of
Common Stock at Prices Ranging
from $10.00 to $19.61 Per
Share - - (148,131) -
Sale of 1,500 Shares of Treasury - - -
Stock At $18.41 per share
Net Income - - - -
Compensation Expense
Cash Dividends, $0.24 Per Share - - - -
------------------------------------------
BALANCE AT December 31, 1997 1,215,400 6,077 7,646,608 -
Purchase of 43,722 Shares of
Common Stock at Prices Ranging
from $10.00 To $22.61 Per Share - - (497,670) -
Net Loss - - -
Compensation Expense - - - 91,389
Cash Dividends, $0.24 Per Share - - - -
------------------------------------------
BALANCE AT DECEMBER 31, 1998 1,215,400 6,077 7,148,938 91,389
Exercise of 9,500 Stock Options
at Prices Ranging $5.00 to
$18.41 Per Share - - (12,218) (54,510)
Tax Benefit of Stock Option
Exercise - - 110,430 -
Net Income - - - -
Compensation Expense - - - 60,122
Cash Dividends, $0.24 Per Share - - - -
------------------------------------------
BALANCE AT DECEMBER 31, 1999 1,215,400 $6,077 $7,247,150 $97,001
========= ====== ========== =======
</TABLE>
(See Independent Auditors' Report and Accompanying Notes)
POLY-SEAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY, CONTINUED
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
<PAGE>
<TABLE>
<CAPTION>
UNEARNED
PORTION OF
TREASURY RETAINED NOTES RESTRICTED
STOCK EARNINGS RECEIVABLE STOCK TOTAL
------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BALANCE AT January 1, 1997, AS $(2,290,576) $26,965,075 $(281,000) $(816,502) $31,377,813
PREVIOUSLY REPORTED
Cumulative Effect on Prior
Years of Retroactive
Restatement for
Accounting Change (Note 1) - 314,793 - - 314,793
Prior Period Adjustment (Note 16) - (465,000) - - (465,000)
------------------------------------------------------------
BALANCE AT JANUARY 1, 1997, AS (2,290,576) 26,814,868 (281,000) (816,502) 31,227,606
RESTATED
Purchase of 25,150 Shares of
Common Stock at Prices Ranging
from $10.00 to $19.61 Per
Share (419,084) - 48,000 148,131 (371,084)
Sale of 1,500 Shares of Treasury 27,615 - - - 27,615
Stock At $18.41 per share
Net Income - 329,574 - - 329,574
Compensation Expense 162,920 162,920
Cash Dividends, $0.24 Per Share (263,607) (263,607)
-------------------------------------------------------------
BALANCE AT December 31, 1997 (2,682,045) 26,880,835 (233,000) (505,451) 31,113,024
Purchase of 43,722 Shares of
Common Stock at Prices Ranging
from $10.00 To $22.61 Per Share (711,644) - 233,000 497,670 (478,644)
Net Loss - (455,844) - - (455,844)
Compensation Expense - - - 7,781 99,170
Cash Dividends, $0.24 Per Share - (254,748) - - (254,748)
-------------------------------------------------------------
BALANCE AT DECEMBER 31, 1998 (3,393,689) 26,170,243 - - 30,022,958
Exercise of 9,500 Stock Options
at Prices Ranging $5.00 to
$18.41 Per Share 187,113 - (120,385) - -
Tax Benefit of Stock Option
Exercise - - - - 110,430
Net Income - 3,135,494 - - 3,135,494
Compensation Expense - - - - 60,122
Cash Dividends, $0.24 Per Share - (250,099) - - (250,099)
-------------------------------------------------------------
BALANCE AT DECEMBER 31, 1999 $(3,206,576) $29,055,638 $(120,385) $ $33,078,905
============ =========== ========== ======= ===========
(See Independent Auditors' Report and Accompanying Notes)
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
POLY-SEAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997
YEAR ENDED
--------------------------------------------
1999 1998 1997
--------------------------------------------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net Income (Loss) $ 3,135,494 $ (455,844) $ 329,574
ADJUSTMENTS TO RECONCILE NET INCOME (LOSS) TO NET
CASH PROVIDED BY OPERATING ACTIVITIES:
Depreciation 4,627,447 4,107,273 3,925,871
Amortization of unearned portion of - 7,780 162,920
restricted stock
Compensation Expense - stock options 60,122 91,389 -
Deferred income taxes 817,366 (264,396) 53,790
Gain on sale of investments - (1,837) (1,532)
(Gain) loss on sale of property and equipment 10,229 (222,400) (737,076)
(Increase) Decrease in accounts receivable 475,994 (356,735) 1,396,039
(Increase) Decrease in inventories (580,438) 1,616,277 279,243
(Increase) Decrease in prepaid expenses and
other current assets 94,999 (54,455) (23,560)
(Increase) Decrease in other assets (11,471) 216,141 (90,425)
Increase (Decrease) in accounts payable
and accrued expenses (1,129,455) (541,406) 564,916
(Increase) Decrease in income taxes receivable 352,115 (281,560) 39,352
Increase in income taxes payable 99,112 - -
--------------------------------------------
Net cash provided by operating activities 7,951,514 3,860,227 5,899,112
INVESTING ACTIVITIES
Purchases and construction of property and (4,523,377) (5,657,802) (6,669,433)
equipment
Proceeds from sale of property and equipment - 384,706 1,466,041
Proceeds from sales of investments - 32,390 152,137
Investment in license agreements (105,000) (150,000) -
--------------------------------------------
Net cash used in investing activities (4,628,377) (5,390,706) (5,051,255)
--------------------------------------------
FINANCING ACTIVITIES
Proceeds from long-term debt - 2,000,000 -
Principle payments on long-term debt (800,000) (583,334) (400,000)
Purchase of treasury stock - (62,328) (371,084)
Tax benefit of stock option exercise 110,430 - -
Proceeds from sale of treasury stock - - 27,615
Payments of dividends (250,099) (254,748) (263,607)
--------------------------------------------
Net cash provided by (used in) financing activities (939,669) 1,099,590 (1,007,076)
--------------------------------------------
Net increase (decrease) in cash and cash equivalents 2,383,468 (430,889) (159,219)
Cash and cash equivalents - Beginning of year 618,544 1,049,433 1,208,652
--------------------------------------------
Cash and cash equivalents - End of year $ 3,002,012 $ 618,544 $ 1,049,433
============================================
</TABLE>
(See Independent Auditors' Report and Accompanying Notes)
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
------------------------------------------
NATURE OF OPERATIONS
--------------------
Poly-Seal Corporation and its subsidiaries are manufacturers of compression
and injection molded plastic closures and figments, which are sold to
customers located throughout the United States.
USE OF ESTIMATES
----------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenue and expenses
during the reporting period. Actual results could differ from those
estimates.
PRINCIPLES OF CONSOLIDATION
---------------------------
The consolidated financial statements include the accounts of Poly-Seal
Corporation and its wholly-owned subsidiaries, Moldcraft Plastics, Inc.
(Moldcraft) and Supply-Line, Inc. (collectively referred to as the
Company). Intercompany transactions and balances have been eliminated. As
of December 31, 1999, the subsidiaries were merged into Poly-Seal
Corporation.
CASH AND CASH EQUIVALENTS
-------------------------
The Company considers all highly liquid investments with a maturity of
three months or less when purchased to be cash equivalents.
The Company has cash and cash equivalents in a major financial institution
which at times may exceed the FDIC insurance limit. The Company believes
it is not exposed to any significant credit risk on cash and cash
equivalents.
(See Independent Auditors' Report)
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
INVENTORIES
-----------
Inventories are valued at the lower of cost, using the first-in, first-out
(FIFO) method, or market.
During 1998, the Company changed its method of determining the cost
of inventories from the last-in, first-out (LIFO) method to the FIFO
method. The Company believes the FIFO method results in a closer matching
of costs and revenue during periods of fluctuating prices. The cumulative
effect of this change on financial statements prior to 1997 has been
recorded as a prior period adjustment. The financial statements for 1997
have been retroactively restated for the change, which resulted in a
decrease in net income of $314,793 (net of taxes of $192,939).
DEPRECIATION
------------
Depreciation is provided on a straight-line basis over the estimated useful
lives of the related assets.
AMORTIZATION
------------
Goodwill is being amortized on a straight-line basis over 15 years.
INCOME TAXES
------------
Deferred income taxes are provided on temporary differences between
financial statement and income tax reporting, arising principally from the
use of accelerated methods of depreciation for income tax purposes.
NET INCOME PER SHARE
--------------------
Net income per share is based on the weighted average number of common
shares outstanding during the year.
RECLASSIFICATIONS
-----------------
Certain amounts in the 1998 financial statements have been reclassified to
conform to the 1999 presentation.
(See Independent Auditors' Report)
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
2. INVESTMENTS
-----------
Marketable equity securities have been classified as available-for-sale and
are stated at cost, which approximates fair value. The corporate bond is
classified as available-for-sale and carried at amortized cost, which
approximates fair value. The Company's investment portfolio at December 31,
1999 and 1998 consisted of the following:
1999 1998
-------- ---------
Equity Securities $ 1,288 $ 1,288
Corporate Bond 19,972 19,972
-------- ---------
$ 21,260 $ 21,260
======== =========
The bond held at December 31, 1999 matures in 2010.
3. INVENTORIES
-----------
Inventories at December 31, 1999 and 1998 consisted of the following:
1999 1998
---------- ----------
Raw Materials $1,942,225 $1,683,612
Work-in-Process 1,630,165 1,802,512
Finished Goods 5,113,272 4,619,100
---------- ----------
$8,685,662 $8,105,224
========== ==========
(See Independent Auditors' Report)
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
4. PROPERTY, PLANT, AND EQUIPMENT
------------------------------
At December 31, 1999 and 1998, property, plant, and equipment consisted of
the following:
1999 1998
----------- -----------
Land $ 500,000 $ 500,000
Buildings and Improvements 9,742,105 9,697,357
Machinery and Equipment 25,296,084 23,774,398
Molds 9,767,981 8,108,355
Automobiles 60,984 128,318
Computer Equipment 3,883,947 3,731,652
Furniture and Fixtures 682,130 673,769
----------- -----------
Total Cost 49,933,231 46,613,849
Less: Accumulated Depreciation 30,478,718 26,022,676
----------- -----------
Property, Plant and Equipment 19,454,513 20,591,173
=========== ===========
5. STOCK OPTION PLANS
------------------
The Company's Restricted Stock Option Plan (1987 Plan) provided for the
grant of options to key managerial employees that were immediately
exercisable for the purchase of restricted common stock generally at a
price below the formula value (estimated fair value) of the stock. As
part of the 1987 Plan, the Company agreed to finance the purchase through
notes. The restrictions, which lapsed ratably over a 10-year period,
generally provided the Company the right to repurchase unvested shares at
the original exercise price. Deferred compensation was recorded equal to
the difference between the exercise price and the formula value and was
amortized to expense as the restrictions lapsed. Deferred compensation
expense was $7,781 and $162,920 for the years ended December 31, 1998 and
1997, respectively.
(See Independent Auditors' Report)
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
The 1987 Plan expired in December 1997 and, during 1998, the Company
repurchased 23,881 shares of common stock, representing all of the
outstanding shares still subject to restrictions, for $30,038 in cash and
the cancellation of notes receivable of $233,000. In connection with that
transaction, additional paid-in capital was reduced by $497,670,
representing the remaining amount of unrecognized deferred compensation.
During 1997, the Company adopted a stock option plan (1997 Plan) under
which key managerial employees may purchase common stock. The 1997 Plan
authorizes the issuance of up to 150,000 options. Employees become 33%
vested in the options two years after the grant date, 66% vested three
years after the grant date, and 100% vested four years after the grant
date. The excess of the fair market value of common stock (determined by
formula) at date of grant over the exercise price is recognized as
compensation expense as employees vest in the options. The options issued
under the 1997 Plan are being accounted for in accordance with Opinion 25
of the Accounting Principles Board (APB No. 25). The Company recognized
compensation expense of $60,122 in 1999, $91,389 in 1998, and $0 in 1997,
under the 1997 Plan. Had compensation expense been determined on the
basis of fair value pursuant to Financial Accounting Standard No. 123,
1999, 1998 and 1997 net income would have been reduced by $59,916, $52,329
and $0, respectively.
(See Independent Auditors' Report)
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
The table below sets forth information regarding options granted under the
1997 Plan:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Weighted
Weighted Average
Number of Average Fair Value Range of
Options Exercise Price of Options Exercise Prices
---------- -------------- ------------ ---------------
Options Outstanding,
January 1, 1997 - - - -
Granted 78,500 $ 16.33 $ 4.49 $ 5.00-$18.41
----------
Options Outstanding,
December 31, 1997 78,500 16.33 4.49 5.00- 18.41
Granted 21,000 10.00 10.60 10.00
----------
Options Outstanding,
December 31, 1998 99,500 14.99 5.78 5.00- 18.41
Granted 33,500 18.74 2.26 18.74
Cancelled (29,000) 16.53 4.57 10.00- 18.41
Exercised (9,500) 12.67 7.40 5.00- 18.41
----------
Options Outstanding,
December 31, 1999 94,500 5.00- 18.41
==========
</TABLE>
At December 31, 1999, 9,166 options were exercisable. The weighted
average remaining term for all options at December 31, 1999 is nine years.
(See Independent Auditors' Report)
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
The Black Scholes option pricing model was used to estimate the fair value
of the options as of the date of the grant. The assumptions used to
determine the fair value included:
Annual Dividend Rate $ 0.24 $ 0.24 $ 0.24
Volatility 0.0% 0.0% 0.0%
Risk Free Interest Rate 5.4% 4.7% 4.7%
6. NOTE PAYABLE
------------
The Company has available unsecured working capital lines of credit totaling
$8 million with two banks. The lines are renewable annually. Loans bear
interest at either fixed or variable rates (as defined in the loan agreement)
at the election of the Company. At December 31, 1999, the Company had $188,000
in letters of credit outstanding under a line of credit. In addition, the
Company has available lines of credit for the acquisition of tooling and
equipment, which expire in July 2001. At December 31, 1999, approximately $5.6
million was available under the equipment lines of credit.
7. LONG-TERM DEBT
--------------
As of December 31, 1999 and 1998, long-term debt consisted of the
following:
1999 1998
-------------- --------------
Banks; monthly payments of $33,334 plus
interest at LIBOR plus .625% until
August 2006 $ 2,666,666 $ 3,066,666
Bank; monthly payments of $33,334 plus
interest at LIBOR plus .625% until
August 2003 1,416,667 1,816,667
-------------- --------------
4,083,333 4,883,333
Less: Current Maturities 800,000 800,000
-------------- --------------
$ 3,283,333 $ 4,083,333
============== ==============
(See Independent Auditors' Report)
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
Maturities of long-term debt at December 31, 1999 for the next five years
were as follows:
Year Ending December 31, 2000 $ 800,000
2001 800,000
2002 800,000
2003 616,667
2004 400,008
The Company is required to maintain certain financial ratios.
To reduce the impact of changes in interest rates on its floating rate
long-term debt, the Company entered into an interest rate swap agreement
with its bank. The agreement entitles the Company to receive from its
bank, on a monthly basis, the amount of any interest paid by the Company
in excess of 6.465% on $1,942,000 of outstanding loans through August
2006.
(See Independent Auditors' Report)
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
8. INCOME TAXES
------------
The provision (benefit) for income taxes consisted of the following:
<TABLE>
<CAPTION>
<S> <C>
1999 1998 1997
---------------------------------------
Current $1,200,061 $ (21,100) $ 170,338
Deferred 817,366 (264,395) 53,789
---------------------------------------
Provision (Benefit) for Income Taxes $2,017,427 $(285,495) $ 224,127
========== ========== =========
Deferred tax assets and liabilities at December 31, 1999 and 1998 were as
follows:
1999 1998
------------ ------------
Deferred Tax Assets $ 394,440 $ 992,506
Deferred Tax Liabilities (2,344,549) (2,125,249)
</TABLE>
9. EMPLOYEE RETIREMENT PLANS
-------------------------
The Company maintains two separate defined benefit pension plans. The plans
cover the Poly-Seal union employees and the Moldcraft salaried and clerical
employees. In 1998 and 1997, the Company maintained an additional defined
benefit pension plan covering the Moldcraft union employees. The Moldcraft
union pension plan was terminated on December 15, 1998. All distributions were
made in accordance with ERISA guidelines.
(See Independent Auditors' Report)
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
The following table provides further information about the plan and amounts
recognized in the Consolidated Balance Sheets:
<TABLE>
<CAPTION>
<S> <C>
1999 1998 1997
---------------------------------------
Fair Value of Plan Assets $ 4,367,449 $ 3,738,447 $ 3,755,329
Less: Benefit Obligation 3,296,774 3,765,658 3,354,993
---------------------------------------
Funded Status $ 1,070,675 $ (27,211) $ 400,336
=========== ============ ===========
Prepaid Pension Cost Recognized as
Other Assets $ 682,392 $ 670,921 $ 792,704
Pension Cost 205,076 240,737 194,486
Employer Contributions 252,184 123,542 299,911
Benefits Paid 101,373 88,009 90,158
Weighted average assumptions are as follows:
1999 1998 1997
---------------------------------------
Poly-Seal (as of September 30):
-------------------------------
Discount Rate 7.50% 6.25% 6.75%
Expected Return on Plan Assets 8.50% 7.25% 7.50%
Rate of Compensation Increase - - -
Moldcraft (as of December 31):
------------------------------
Discount Rate 7.00% 7.50% 7.50%
Expected Return on Plan Assets 8.50% 8.50% 8.50%
Rate of Compensation Increase - - -
(See Independent Auditors' Report)
</TABLE>
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
The Company also maintains a money purchase pension plan for qualified
nonunion employees to which it contributes 9% of compensation, as defined in
the plan. Contributions for the years ended December 31, 1999, 1998 and 1997
were $397,371, $439,062 and $488,091, respectively. In addition, the Company
also maintains two separate 401(k) plans that cover Poly-seal salaried and
union employees, respectively. There were no contributions to either plan
during the years ended December 31, 1999, 1998 and 1997.
10. RESTRUCTURING OF OPERATIONS
---------------------------
In 1996, management adopted a plan to consolidate the operations of three
of its manufacturing facilities into one facility. The consolidation of
these operations was completed during 1998. In December 1997, the Company
sold the land and building at its Pulaski manufacturing facility. This
sale resulted in a gain of $1,047,455.
In January 1998, the Company sold the land, building, and certain
machinery and equipment at its Shannon Drive manufacturing facility for
cash and a note receivable. The sale resulted in a loss of approximately
$214,000, which is reflected in the 1997 Consolidated Statement of
Operations. The Company received the proceeds of the note in February
2000.
Certain costs associated with maintaining the above two facilities
subsequent to the consolidation of their respective operations have been
presented as Restructuring and Idle Facility Expenses in the accompanying
Consolidated Statements of Operations.
In addition, the consolidation resulted in the termination of certain
employees. The Company recorded $300,000 for severance pay relating to
these terminations, which is included in Restructuring and Idle Facility
Expenses in the accompanying 1998 Consolidated Statement of Operations.
11. SHUT DOWN COSTS
---------------
During 1998, the Company shut down its Holabird Plant for a 2-week period
in response to a health related event. The costs for remediation, payroll
costs, and other related costs to restart operations have been presented
as shut down costs in the accompanying Consolidated Statement of
Operations. The Company is negotiating with a third-party contractor for
reimbursement of these costs.
(See Independent Auditors' Report)
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
12. UNUSUAL EXPENSES
----------------
During 1999, the Company experienced a fire, which was contained to the
cooling tower equipment on the roof of its Holabird plant. The costs for
repairs and temporary replacement of assets have been presented as unusual
expenses in the accompanying Consolidated Statement of Operations. The
Company is pursuing reimbursement of these expenses through its property
and casualty insurance coverage and through a potential legal claim.
13. SUPPLEMENTAL CASH FLOW INFORMATION
----------------------------------
Cash paid during the years ended December 31, 1999, 1998 and 1997 included
the following:
<TABLE>
<CAPTION>
<S> <C>
1999 1998 1997
---------------------------------------
Income Taxes $ 951,200 $ 208,000 $ 102,400
Interest 285,894 339,349 231,131
During the year ended December 31, 1999, stock options were exercised for
notes receivable of $120,385 (Note 5).
During the year ended December 31, 1998, purchases of treasury stock
resulted in a reduction in notes receivable of $233,000 and an increase in
accrued liabilities of $416,316. In January 1998, the Company sold a
building in exchange for a note receivable in the amount of $1,850,000
(Note 10).
During the year ended December 31, 1997, purchases of treasury stock
resulted in a reduction of notes receivable of $48,000.
(See Independent Auditors' Report)
<PAGE>
POLY-SEAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS, CONTINUED
14. COMMITMENTS
-----------
LEASES
------
The Company leases a warehouse facility and a sales office under operating
leases expiring in various years through the year 2003. The Company has an
option to renew the warehouse facility lease for six years. The Company also
leases vehicles and office equipment under operating leases through 2003.
Future minimum lease payments required under operating leases are as
follows:
Year Ending December 31, 2000 $ 443,234
2001 408,690
2002 404,548
2003 365,678
Rent expense for the years ended December 31, 1999, 1998 and 1997 was
$478,714, $653,670 and $426,445, respectively.
STOCK REPURCHASE
----------------
The Company has granted certain stockholders, who purchased common stock
under the 1987 Plan, the right to require the Company to repurchase the
shares at formula value. At December 31, 1999, the aggregate formula value
of these shares was $1,076,000.
15. SUBSEQUENT EVENT
----------------
On December 28, 1999, the Company's shareholders signed a letter of intent
to sell all the Company's outstanding common stock to Berry Plastics
Corporation. The terms of the Company's long-term debt allow the lender
to accelerate the debt upon a change in the majority ownership of the
Company. In addition, currently outstanding stock options will become
vested under the terms of the stock option plan. The transaction is
expected to close during the first quarter of 2000.
16. PRIOR PERIOD ADJUSTMENT
-----------------------
During 1999, the Company determined the accrued vacation liability for the
years prior to 1999 had not been properly recorded. As a result, retained
earnings at January 1, 1997 have been reduced by $465,000.
(See Independent Auditors' Report)
<PAGE>
Poly-Seal Corporation and Subsidiaries
Consolidated Balance Sheets
May 9, 2000
(In Thousands of Dollars)
</TABLE>
<TABLE>
<CAPTION>
(UNAUDITED)
<S> <C>
Assets
Current assets:
Cash and cash equivalents $ 349
Accounts receivable(less allowance for doubtful accounts of $182) 5,884
Inventories 9,724
Other current assets 151
-------------
Total current assets 16,108
Property and equipment, cost 54,263
Property and equipment, accumulated depreciation (32,252)
-------------
Property and equipment, net 22,011
Intangible assets, net 524
Other assets 1,882
-------------
Total assets $ 40,525
=============
(UNAUDITED)
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Accounts payable $ 1,294
Accrued expenses and other liabilities 1,822
Current portion of long-term debt 800
-------------
Total current liabilities 3,916
Long-term debt, less current portion 2,233
Other liabilities 2,177
-------------
Total liabilities 8,326
Stockholders' equity 21,199
-------------
Total liabilities and stockholders' equity $ 40,525
=============
SEE ACCOMPANYING NOTE.
<PAGE>
Poly-Seal Corporation and Subsidiaries
Consolidated Statements of Operations
For the period from January 1, 2000 to May 9, 2000
(In Thousands of Dollars)
(UNAUDITED)
<S> <C>
Net sales $ 17,060
Cost of goods sold 16,244
-------------
Gross margin 816
Operating expenses:
Selling 919
General and administrative 1,021
Other 694
-------------
Operating loss (1,818)
Other income:
Interest income 40
Other income 121
-------------
Loss before income taxes (1,657)
Income tax benefit (693)
-------------
Net loss $ (964)
=============
</TABLE>
SEE ACCOMPANYING NOTE
<PAGE>
Poly-Seal Corporation and Subsidiaries
Consolidated Statements of Cash Flows
For the period from January 1, 2000 to May 9, 2000
(In Thousands of Dollars)
<TABLE>
<CAPTION>
UNAUDITED
<S>
OPERATING ACTIVITIES
Net loss $ (964)
<S> <C>
Adjustments to reconcile net loss to net cash provided by
operating activities:
Depreciation 1,815
Deferred income taxes 30
Amortization 27
Changes in operating assets and liabilities:
Accounts receivable, net 286
Inventories (1,039)
Prepaid expenses and other receivables 81
Payables and accrued expenses (786)
Income taxes payable (1,206)
-------------
Net cash used for operating activities (1,756)
INVESTING ACTIVITIES
Additions to property and equipment (1,775)
-------------
Net cash used for investing activities (1,775)
FINANCING ACTIVITIES
Long-term notes receivable 1,970
Payments on long-term borrowings (1,050)
Payments of dividends (63)
-------------
Net cash provided by financing activities 857
-------------
Net decrease in cash and cash equivalents (2,674)
Cash and cash equivalents at beginning of period 3,023
-------------
Cash and cash equivalents at end of period $ 349
=============
</TABLE>
SEE ACCOMPANYING NOTE.
<PAGE>
Poly-Seal Corporation and Subsidiaries
Note to Consolidated Financial Statements
(In Thousands of Dollars)
As of May 9, 2000 and for the period from January 1, 2000 to May 9, 2000
The unaudited consolidated financial statements of Poly-Seal Corporation and
Subsidiaries as of May 9, 2000 and for the period from January 1, 2000 to May
9, 2000 have been prepared in accordance with generally accepted accounting
principles for interim financial information. Accordingly, they do not include
all of the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management,
all adjustments considered necessary for a fair presentation have been
included. Operating results for the period presented are not necessarily
indicative of the results that may be expected for the full fiscal year. These
statements should be read in conjunction with the consolidated audited
financial statements of Poly-Seal Corporation as of December 31, 1999 and 1998
and for the years ended December 31, 1999, 1998 and 1997 included in this Form
8-K/A.
Comparative consolidated financial statements as of May 9, 1999 and for the
period from January 1, 1999 to May 9, 1999 have not been presented as these
statements were not available.
<PAGE>
BPC HOLDING CORPORATION
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS)
The following unaudited pro forma condensed consolidated balance sheet and pro
forma condensed consolidated statements of operations (collectively, the "Pro
Forma Statements") give effect to the purchase of the outstanding common stock
of Poly-Seal Corporation ("Poly-Seal") and CPI Holding Corporation ("CPI
Holding") by Berry Plastics Corporation ("Berry"). Berry is a wholly owned
subsidiary of BPC Holding Corporation ("Holding").
The pro forma information is based on the historical consolidated financial
statements of Holding, the historical financial statements of Poly-Seal and CPI
Holding, giving effect to the acquisitions using the purchase method of
accounting and the assumptions and adjustments in the accompanying notes to the
pro forma condensed consolidated financial statements. The pro forma condensed
balance sheet gives effect to the acquisitions as if they had occurred April 1,
2000 and the condensed statements of operations give effect to the acquisitions
as if it had occurred at the beginning of the respective period. There are no
pro forma condensed balance sheet adjustments as of April 1, 2000 for the
acquisition of CPI Holding as these adjustments are reflected in Holding's
historical balances as of April 1, 2000. There are no pro forma condensed
consolidated statement of operations adjustments for the three months ended
April 1, 2000 for the acquisition of CPI Holding as the operations of this
business are included in Holding's historical balances from January 2, 2000
through April 1, 2000.
The Pro Forma Statements do not purport to represent what Holding's
consolidated financial position or results of operations would actually have
been if such transactions had in fact occurred on such dates or to project
Holding's consolidated financial position or results of operations for any
future date or period. The pro forma adjustments are based upon available
information and upon assumptions that Holding believes to be reasonable. The
Pro Forma Statements and accompanying notes should be read in conjunction with
the historical consolidated financial statements and related notes of Holding
included within its Annual Report on Form 10-K for the year ended January 1,
2000, with the audited consolidated financial statements and related notes of
Poly-Seal as of December 31, 1999 and 1998 and for the years ended December 31,
1999, 1998 and 1997 included in this Form 8-K/A, and with Form 8-K/A filed on
September 20, 1999 which provides similar information related to the
acquisition of CPI Holding.
<PAGE>
BPC HOLDING CORPORATION
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
APRIL 1, 2000
----------------------------------------------------------------------------------
HOLDING POLY-SEAL PRO FORMA CONSOLIDATED
HISTORICAL HISTORICAL ADJUSTMENTS PRO FORMA
------------------ ----------------- ----------------- ------------------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS (UNAUDITED) (UNAUDITED)
Current assets
Cash and cash equivalents $ 2,707 $ 4,459 $ - $ 7,166
Accounts receivable 49,164 6,256 - 55,420
Inventories 44,514 9,210 - 53,724
Other current assets 5,389 424 - 5,813
------------------ ----------------- ----------------- ------------------
Total current assets 101,774 20,349 - 122,123
Property and equipment, net 146,611 21,918 4,148 (a) 172,677
Intangible assets, net 99,992 536 19,225 (b) 119,753
Other assets 2,339 780 - 3,119
------------------ ----------------- ----------------- ------------------
Total assets $ 350,716 $ 43,583 $23,373 $417,672
================== ================= ================= ==================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 30,003 $ 1,333 $ - $ 31,336
Accrued liabilities 35,977 2,484 - 38,461
Current portion of long-term debt 21,593 800 1,857 (c) 24,250
------------------ ----------------- ----------------- ------------------
Total current liabilities 87,573 4,617 1,857 94,047
Long-term debt, less current portion 390,222 3,083 30,222 (d) 423,527
Other liabilities 13,843 2,177 - 16,022
------------------ ----------------- ----------------- ------------------
Total liabilities 491,638 9,877 32,079 533,594
Stockholders' equity (deficit):
Total stockholders' equity (deficit) (140,922) 33,706 (8,706) (e) (115,922)
------------------ ----------------- ----------------- ------------------
Total liabilities and
stockholders' equity $ 350,716 $ 43,583 $23,373 $417,672
================== ================= ================= ==================
</TABLE>
SEE ACCOMPANYING NOTE.
<PAGE>
BPC HOLDING CORPORATION
NOTES TO PRO FORMA UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEET
(DOLLARS IN THOUSANDS)
The historical balance sheet presented for Holding is as of April 1, 2000,
and the historical balance sheet presented for Poly-Seal is as of March 31,
2000. The following adjustments reflect the acquisition of the common
stock of Poly-Seal and the repayment of the outstanding debt of Poly-Seal
on a pro forma basis using proceeds from additional borrowings under
Berry's credit facility and the issuance by Holding of $25.0 million of
14% preferred stock. The pro forma allocations to the assets acquired and
liabilities assumed have been made using estimates by management and may
be adjusted subsequently. The amount allocated to cost in excess of assets
acquired may be subsequently adjusted but any such adjustment is not
expected to be material. The cost in excess of net assets acquired will
be amortized by the straight-line method over a period of 15 years.
<TABLE>
<CAPTION>
(a) Adjustment to property and equipment, net:
<S> <C>
Write up to fair market value $ 4,148
============
(b) Adjustment to intangible assets, net:
Allocation of excess of purchase price over net assets acquired to
intangible assets $ 19,225
============
(c) Adjustments to current portion of long-term debt:
Repayment of debt $ (800)
Additional current borrowings under credit facility 2,657
------------
Net change in current portion of long-term debt $ 1,857
============
(d) Adjustments to long-term debt, excluding current portion:
Repayment of debt $ (3,083)
Additional borrowings under credit facility 33,305
------------
Net change in long-term debt, excluding current portion $ 30,222
============
(e) Adjustments to stockholders' equity:
Elimination of equity prior to acquisition $(33,706)
Additional paid in capital by Holding through the issuance by
Holding of 14% preferred stock 25,000
------------
Net change in stockholders' equity $ (8,706)
============
</TABLE>
<PAGE>
BPC HOLDING CORPORATION
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
FISCAL 1999
--------------------------------------------------------------------------------------------
HOLDING POLY-SEAL CPI HOLDING PRO FORMA CONSOLIDATED
HISTORICAL HISTORICAL HISTORICAL ADJUSTMENTS PRO FORMA
----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net sales $ 328,834 $ 49,828 $ 31,327 $ - $ 409,989
Cost of goods sold 241,067 37,439 25,674 - 304,180
--------------- ------------- --------------- ---------------- ---------------
Gross margin 87,767 12,389 5,653 - 105,809
Operating expenses 54,118 7,248 3,515 1,284 (a)
1,600 (d) 67,765
--------------- ------------- --------------- ---------------- ----------------
Operating income (loss) 33,649 5,141 2,138 (2,884) 38,044
Interest expense, net 40,817 290 3,170 2,690 (b) 48,111
1,144 (e)
Other income (expense) (1,416) 302 - - (1,114)
--------------- ------------- --------------- ---------------- ----------------
Income (loss) before income taxes (8,584) 5,153 (1,032) (6,718) (11,181)
Income tax expense (benefit) 554 2,017 202 (2,017) (c) 554
(202) (f)
--------------- ------------- --------------- ---------------- ----------------
Net income (loss) $ (9,138) $ 3,136 $ (1,234) $ (4,499) $ (11,735)
=============== ============= =============== ================ ================
</TABLE>
SEE ACCOMPANYING NOTES.
<PAGE>
BPC HOLDING CORPORATION
NOTES TO PRO FORMA UNAUDITED CONDENSED
CONSOLIDATED STATEMENT OF OPERATIONS
(DOLLARS IN THOUSANDS)
YEAR ENDED JANUARY 1, 2000
The historical consolidated statement of operations presented for Holding is
for its fiscal year ended January 1, 2000, and the historical statement of
operations presented for Poly-Seal is for the twelve months ended
December 31, 1999. The historical statement of operations presented for CPI
Holding is for its six month period ended May 31, 1999.
<TABLE>
<CAPTION>
POLY-SEAL ADJUSTMENTS
<S> <C>
(a) Adjustment to operating expenses:
Increase in amortization due to increase in cost in excess of net
assets acquired $ 1,284
--------------
(b) Adjustments to interest expense:
Elimination of interest expense on debt extinguished $ (290)
Additional interest incurred on borrowing for acquisition 2,980
--------------
Net change in interest expense 2,690
==============
(c) Adjustment to income tax expense:
Elimination of income tax expense due to Holding's net operating loss
carryforward $(2,017)
==============
CPI HOLDING ADJUSTMENTS
<S> <C>
(d) Adjustment to operating expense:
Increase in amortization due to increase in cost in excess of net
assets acquired $ 1,600
--------------
(e) Adjustments to interest expense:
Elimination of interest expense on debt extinguished $(3,170)
Additional interest incurred on borrowing for acquisition 4,314
--------------
Net change in interest expense $ 1,144
==============
(f) Adjustment to income tax expense:
Elimination of income tax expense due to Holding's net operating loss
carryforward $ (202)
==============
</TABLE>
<PAGE>
BPC HOLDING CORPORATION
PRO FORMA UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED APRIL 1, 2000
-----------------------------------------------------------------------------------
HOLDING POLY-SEAL PRO FORMA CONSOLIDATED
HISTORICAL HISTORICAL ADJUSTMENTS PRO FORMA
---------------- --------------- ----------------- ----------------
<S> <C> <C> <C> <C>
Net sales $ 97,184 $ 12,391 $ - $ 109,575
Cost of goods sold 75,189 9,597 - 84,786
---------------- --------------- ----------------- ----------------
Gross margin 21,995 2,794 - 24,789
Operating expenses 16,228 1,812 321 (a) 18,361
---------------- --------------- ----------------- ----------------
Operating income (loss) 5,767 982 (321) 6,428
Interest expense (income), net 11,539 (4) 749 (b) 12,284
Other income (expense) (528) 85 - (443)
---------------- --------------- ----------------- ----------------
Income (loss) before income taxes (6,300) 1,071 (1,070) (6,299)
Income tax expense (benefit) 16 398 (398) (c) 16
---------------- --------------- ----------------- ----------------
Net income (loss) $ (6,316) $ 673 $ (672) $ (6,315)
================ =============== ================= ================
</TABLE>
SEE ACCOMPANYING NOTES.
<PAGE>
BPC Holding Corporation
Notes to Pro Forma Unaudited Condensed
Consolidated Statement of Operations
(Dollars in thousands)
THREE MONTHS ENDED APRIL 1, 2000
<TABLE>
<CAPTION>
The historical consolidated statement of operations presented for Holding
is for its three months ended April 1, 2000 and the historical statement of
operations presented for Poly-Seal is for the three months ended March 31,
2000.
<S> <C>
(a) Adjustment to operating expenses:
Increase in amortization due to increase in cost in excess of net
assets acquired $ 321
=============
(b) Adjustments to interest expense:
Elimination of interest income $ 4
Additional interest incurred on borrowing for the acquisition 745
-------------
$ 749
=============
(c) Adjustment to income tax expense:
Elimination of income tax expense due to Holding's net operating loss
carryforward $ (398)
=============
</TABLE>
<PAGE>
UNAUDITED PRO FORMA FINANCIAL INFORMATION OF
BERRY PLASTICS CORPORATION
(DOLLARS IN THOUSANDS)
The following summarizes pro forma unaudited financial information of Holding's
wholly owned subsidiary, Berry. The pro forma information is based on the
historical consolidated financial statements of Berry, the historical financial
statements of Poly-Seal, and the historical financial statements of CPI
Holding, giving effect to the acquisitions using the purchase method of
accounting and the assumptions and adjustments in the accompanying notes to the
pro forma condensed consolidated financial statements. The pro forma condensed
balance sheet gives effect to the acquisitions as if they had occurred on April
1, 2000 and the pro forma statements of operations give effect to the
acquisitions as if they had occurred at the beginning of the respective period.
<TABLE>
<CAPTION>
CONSOLIDATED PRO FORMA BALANCE SHEET
<S> <C>
Current assets $ 121,421
Property and equipment, net of accumulated depreciation 172,677
Other noncurrent assets 119,792
Current liabilities 89,436
Noncurrent liabilities 323,559
Equity 895
CONSOLIDATED STATEMENT OF OPERATIONS
Year ended January 1, 2000:
Net sales $ 409,989
Cost of goods sold 304,180
Income before income taxes 2,734
Net income 2,197
Three months ended April 1, 2000:
Net sales $ 109,575
Cost of goods sold 84,786
Loss before income taxes (2,551)
Net loss (2,563)
</TABLE>
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this amendment to be signed on its behalf by the
undersigned, thereunto duly authorized.
Berry Plastics Corporation
BPC Holding Corporation
Berry Iowa Corporation
Berry Tri-Plas Corporation
Berry Sterling Corporation
Aerocon, Inc.
Packerware Corporation
Berry Plastics Design Corporation
Venture Packaging, Inc.
Venture Packaging Midwest, Inc.
Venture Packaging Southeast, Inc.
Knight Plastics, Inc.
CPI Holding Corporation
Cardinal Packaging, Inc.
Poly-Seal Corporation
Berry Plastics Acquisition Corporation II
Berry Plastics Acquisition Corporation III
Dated: July 24, 2000
By: /S/ JAMES M. KRATOCHVIL
James M. Kratochvil
Executive Vice President, Chief Financial
Officer,Treasurer and Secretary of the
entities listed above(Principal Financial
and Accounting Officer)
NIM Holdings Limited
Berry Plastics U.K. Limited
Norwich Acquisition Limited
Dated: July 24, 2000 By: /S/ JAMES M. KRATOCHVIL
James M. Kratochvil
Director of the entities listed above
(Principal Financial and Accounting
Officer)
