FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________________________________________________
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)OF
THE SECURITIES EXCHANGE ACT OF 1934
For The Quarterly Period Ended December 31, 1997
_____________________________
Commission File Number 0-16251
GALAXY FOODS COMPANY
(Exact name of registrant as specified in its charter)
Delaware 25-1391475
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2441 Viscount Row
Orlando, Florida 32809
(Address of principal executive offices) (Zip Code)
(407) 855-5500
(Registrant's telephone number, including area code)
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
On December 31, 1997, there were 61,619,060 shares of Common
Stock $.01 par value per share, outstanding.
<PAGE>2
GALAXY FOODS COMPANY
Index to Form 10-QSB
For Quarter Ended December 31, 1997
PAGE NO.
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets 3
Condensed Statements of Operations 4
Condensed Statements of Stockholders' Equity 5
Condensed Statements of Cash Flows 6-7
Notes to Condensed Financial Statements 8-9
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 10-12
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 13-16
SIGNATURES 17
<PAGE>3
PART I. FINANCIAL INFORMATION
GALAXY FOODS COMPANY
CONDENSED BALANCE SHEETS
DECEMBER 31, MARCH 31,
1997 1997
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 19,378 $ 16,485
Marketable securities -- 298,671
Trade receivables, net 2,470,375 1,631,268
Inventories 2,387,785 1,802,244
Prepaid expenses 410,435 346,082
Total current assets 5,287,973 4,094,750
PROPERTY & EQUIPMENT, NET 10,484,613 8,186,009
OTHER ASSETS 98,564 211,687
TOTAL $ 15,871,150 $ 12,492,446
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Line of credit $ 3,021,626 $ 1,370,953
Accounts payable - trade 1,795,326 449,227
Accrued liabilities 382,658 418,968
Current portion of obligations
under capital leases 22,434 24,396
Total current liabilities 5,222,044 2,263,544
OBLIGATIONS UNDER CAPITAL LEASES,
less current portion 13,639 32,668
Total liabilities 5,235,683 2,296,212
COMMITMENTS AND CONTINGENCIES -- --
STOCKHOLDERS' EQUITY:
Convertible preferred stock -- 26
Common stock 616,191 571,282
Additional paid-in capital 45,827,684 45,780,462
Accumulated deficit (23,036,208) (23,383,336)
23,407,667 22,968,434
Less: Notes receivable arising from
the exercise of stock options and
sale of common stock 12,772,200 12,772,200
Total stockholders' equity 10,635,467 10,196,234
TOTAL $ 15,871,150 $ 12,492,446
See accompanying notes to condensed financial statements.
<PAGE> 4
GALAXY FOODS COMPANY
CONDENSED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED NINE MONTHS ENDED
DECEMBER 31, DECEMBER 31,
(unaudited) (unaudited)
1997 1996 1997 1996
NET SALES $ 4,568,397 $ 4,376,126 $ 15,483,848 $ 12,864,562
COST OF GOODS SOLD 3,238,034 3,842,937 11,789,444 11,074,438
Gross Margin 1,330,363 533,189 3,694,404 1,790,124
OPERATING EXPENSES:
Selling 622,390 564,895 1,562,580 1,404,974
Delivery 224,254 186,305 664,121 456,574
General and administrative 243,579 316,035 965,544 965,082
Research and development 18,816 48,350 114,963 153,953
Total 1,109,039 1,115,585 3,307,208 2,980,583
OPERATING INCOME (LOSS) 221,324 (582,396) 387,196 (1,190,459)
OTHER INCOME (EXPENSE):
Interest expense (25,297) (7,700) (65,127) (17,581)
Interest income 2,197 17,242 4,744 100,910
Other income 391 (2,268) 20,315 2,833
Total (22,709) 7,274 (40,068) 86,162
NET INCOME (LOSS) 198,615 (575,122) 347,128 (1,104,297)
PREFERRED STOCK DIVIDENDS -- -- -- (1,594,406)*
NET INCOME (LOSS) APPLICABLE
TO COMMON STOCK $ 198,615 $ (575,122) $ 347,128 $ (2,698,703)*
NET INCOME (LOSS) PER
COMMON SHARE $ -- $ (.02) $ .01 $ (.08)*
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING 63,429,730 35,114,929 62,997,802 34,574,224
* Amounts have been restated to reflect a stock dividend on preferred stock
which is convertible at a discount from market value at the date of issuance
(See Note 3).
See accompanying notes to condensed financial statements.
<PAGE> 5
GALAXY FOODS COMPANY
CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
Common Stock Preferred Stock Additional Notes
Rec &
Par Par Paid-In Accumulated Subs.
for
Shares Value Shares Value Capital Deficit Common
Stock Total
<S> <C> <C> <C> <C><C> <C> <C>
<C>
Balance at March 31,
1996, as restated 53,421,848 $ 534,218 -- $ -- $ 38,582,938* $ (19,052,270)
$(12,796,200) $ 7,268,686
Exercise of options 96,166 962 -- -- 47,321 --
- -- 48,283
Exercise of warrants 215,000 2,150 -- -- 120,163 --
- -- 122,313
Issuance of common stock
under employee stock
purchase plan 91,879 919 -- -- 86,681 --
- -- 87,600
Collection of note
receivable -- -- -- -- -- --
24,000 24,000
Issuance of common
stock through Reg D
offering 1,337,524 13,375 -- -- 1,846,096 --
- -- 1,859,471
Issuance of convertible
preferred stock through
Reg D offering -- -- 4,000 40 3,733,901 --
- -- 3,733,941
Conversion of
preferred stock into
common stock 1,965,824 19,658 (1,443) (14) (19,644) --
- -- --
Issuance and revaluation
of warrants -- -- -- -- (211,400) --
- -- (211,400)
Preferred stock
dividend -- -- -- -- 1,594,406 (1,594,406)
- -- --
Net loss -- -- -- -- -- (2,736,660)
- -- (2,736,660)
Balance at
March 31, 1997 57,128,241 $ 571,282 2,557 $ 26 $ 45,780,462 $ (23,383,336)
$(12,772,200) $ 10,196,234
Exercise of options 114,100 1,141 -- -- 56,143 --
- -- 57,284
Conversion of
preferred stock
into common stock 4,352,776 43,528 (2,557) (26) (43,502) --
- -- --
Issuance of warrants -- -- -- -- 9,550 --
- -- 9,550
Refund of stock
issuance costs -- -- -- -- 8,750 --
- -- 8,750
Issuance of common stock
under Employee stock
purchase plan 23,943 240 -- -- 16,281 --
- -- 16,521
Net income -- -- -- -- -- 347,128
- -- 347,128
Balance
Dec. 30, 1997 61,619,060 $ 616,191 -- $ -- $ 45,827,684 $ (23,036,208) $
(12,772,200) $ 10,635,467
</TABLE>
* Amounts have been restated to reflect a stock dividend on preferred stock
which is convertible at a discount from market value at the date of issuance
(See Note 3).
See accompanying notes to condensed financial statements.
<PAGE>6
GALAXY FOODS COMPANY
CONDENSED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED
DECEMBER 31,
1997 1996
(Unaudited) (Unaudited)
CASH FLOWS FROM/(USED IN) OPERATING
ACTIVITIES:
Net Income (Loss) $ 347,128 $ (1,104,297)
ADJUSTMENTS TO RECONCILE NET INCOME
(LOSS) TO NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES:
Depreciation expense 484,451 297,032
(Gain) loss on sale of assets (1,329) 4,877
Consulting and director fee expense paid
through issuance of common stock warrants 122,673 5,236
(Increase) decrease in:
Trade receivables (839,107) (906,450)
Inventories (585,541) (1,214,911)
Prepaid expenses (64,353) (149,885)
Increase (decrease) in:
Accounts payable 1,346,099 (43,282)
Accrued liabilities (36,310) 629
NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES 773,711 (3,111,051)
CASH FLOWS FROM/(USED IN) INVESTING
ACTIVITIES:
Purchase of marketable securities -- (491,480)
Purchase of property and equipment (1,336,493) (2,574,258)
Sale of property and equipment -- 22,500
Increase in other assets -- (36,343)
Sale of marketable securities 300,000 --
NET CASH USED IN INVESTING
ACTIVITIES (1,036,493) (3,079,581)
CASH FLOWS FROM/(USED IN) FINANCING
ACTIVITIES:
Borrowings on line of credit 14,757,312 96,559
Repayments on line of credit (14,553,201) --
Book overdraft -- 269,020
Principal payments on note payable -- (63,451)
Principal payments on capital lease obligations (20,991) (50,197)
Proceeds from issuance of common stock, net 16,521 1,928,811
Proceeds from issuance of convertible preferred
stock, net of offering costs -- 3,733,941
Proceeds from exercise of common stock options 57,284 39,283
Proceeds from exercise of common stock warrants -- 103,719
Refund of stock issuance costs 8,750 --
Collection of note receivable for common stock -- 24,000
NET CASH FROM FINANCING
ACTIVITIES 265,675 6,081,685
<PAGE>7
GALAXY FOODS COMPANY
CONDENSED STATEMENTS OF CASH FLOWS (continued)
NINE MONTHS ENDED
DECEMBER 31,
1997 1996
(Unaudited) (Unaudited)
NET INCREASE IN CASH AND CASH EQUIVALENTS 2,893 (108,947)
CASH AND CASH EQUIVALENTS, BEGINNING
OF PERIOD 16,485 127,936
CASH AND CASH EQUIVALENTS, END
OF PERIOD $ 19,378 $ 18,989
See accompanying notes to condensed financial statements.
<PAGE>8
GALAXY FOODS COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
(1) Management Representation
In the opinion of Galaxy Foods Company (the "Company"),
the accompanying unaudited financial statements contain all
adjustments necessary to present fairly the Company's
financial position, results of operations and cash flows for
the periods presented. The results of operations for the
interim periods presented are not necessarily indicative of
the results to be expected for the full year.
The condensed financial statements should be read in
conjunction with the financial statements and the related
disclosures contained in the Company's Form 10-KSB dated
June 20, 1997, filed with the Securities and Exchange
Commission.
(2) Reclassifications
Certain items in the financial statements of prior periods
have been reclassified to conform to current period
presentation.
(3) Restatement of Stockholders' Equity
In March 1997, the Securities and Exchange Commission Staff
(the "Staff") announced its position on accounting for
preferred stock which is convertible into common stock at a
discount from the market rate at the date of issuance. The
Staff's position is that a preferred stock dividend should
be recorded for the difference between the conversion price
and the quoted market price of common stock at the date of
issuance. To comply with this position, the Company
restated its prior year's financial statements to reflect a
dividend of $3,130,294 related to the fiscal 1996 sales of
convertible preferred stock. In compliance with the Staff's
position, the Company also recorded a preferred stock
dividend in the amount of $1,594,406 in fiscal 1997, for the
April 1996 sale of convertible preferred stock.
(4) Inventories
Inventories are summarized as follows:
DECEMBER 31, MARCH 31,
1997 1997
(unaudited)
Raw materials $ 1,444,316 $ 1,136,269
Finished goods 943,469 665,975
Total $ 2,387,785 $ 1,802,244
(5) Net Income (Loss) per Share
Net income per share is computed based on the weighted
average number of shares outstanding during the period,
plus common equivalent shares arising from the effect of
convertible preferred stock and the assumed exercise of
dilutive common stock warrants and employees' stock options,
less the number of treasury shares assumed to be purchased
from the proceeds under the treasury stock method and the
per share market value of the common stock. The difference
between shares for primary and fully diluted income per
share was not material; accordingly, fully diluted income
per share is not presented.
Net loss per share is computed based on the weighted average
number of shares outstanding during the period. Common
stock equivalents have not been included in the calculation
of net loss per share as the effect would be antidilutive.
<PAGE>9
GALAXY FOODS COMPANY
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Continued)
(5) Net Income (Loss) per Share - Continued
In February 1997, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standards No. 128
"Earnings Per Share" ("SFAS 128"). SFAS 128 establishes
new standards for computing and presenting earnings per
share ("EPS"). Specifically, SFAS 128 replaces the
presentation of primary EPS with a presentation of basic
EPS, requires dual presentation of basic and diluted EPS on
the face of the income statement for all entities with
complex capital structures and requires a reconciliation of
the numerator and denominator of the basic EPS computation
to the numerator and denominator of the diluted EPS
computation. SFAS 128 is effective for financial statements
issued for periods ending after December 15, 1997; earlier
application is not permitted. EPS for the quarters ended
December 31, 1997 and December 31, 1996 computed under SFAS
128 would not be materially different than previously
computed.
(6) Supplemental Cash Flow Information
For purposes of the statement of cash flows, all highly
liquid investments with a maturity date of three months or
less are considered to be cash equivalents. Cash and cash
equivalents include checking accounts, money market funds
and certificates of deposits.
For the nine months ended December 31, 1997 1996
Noncash financing and investing activities:
Consulting and directors fees paid through
issuance of common stock warrants 122,673 --
Purchase of equipment under capital lease option -- 26,105
Warrants issued for consulting services 9,550 251,750
Cash paid for:
Interest 39,830 24,560
<PAGE>10
GALAXY FOODS COMPANY
Management's Discussion and Analysis of
Financial Condition and Results of Operations
The following discussion and analysis should be read in
conjunction with the Condensed Financial Statements and Notes
thereto appearing elsewhere in this report.
The following discussion contains certain forward-looking
statements, within the meaning of the "safe-harbor" provisions
of the Private Securities Reform Act of 1995, the attainment of
which involves various risks and uncertainties. Forward-looking
statements may be identified by the use of forward-looking
terminology such as "may", "will", "expect", "believe",
"estimate", "anticipate", "continue", or similar terms,
variations of these terms or the negative of those terms. The
Company's actual results may differ materially from those
described in these forward-looking statements due to among other
factors, competition in the Company's product markets, dependence
on suppliers, the Company's manufacturing experience, and
production delays or inefficiencies.
The Company has conducted a comprehensive review of its computer
systems to identify systems that could be affected by the "Year
2000" issue and has developed an implementation plan to resolve
the issue. The Year 2000 problem is the result of computer
programs being written using two digits rather than four to
define the applicable year. Any of the Company's programs that
have time-sensitive software may recognize a date using "00" as
the year 1900 rather than the year 2000. This could result in a
major system failure or miscalculations if not appropriately
addressed. The Company presently believes that, with
modifications to existing software and by converting to new
software, the Year 2000 problem will not pose significant
operational problems for the Company's computer systems as so
modified and converted.
The Company is principally engaged in the development,
manufacturing and marketing of a variety of healthy cheese and
dairy-related products, as well as other cheese alternatives.
These healthy cheese and dairy-related products include low or no
fat, low or no cholesterol and lactose-free varieties. These
products are sold throughout the United States and
internationally to customers in the retail, foodservice and
industrial markets. The Company's headquarters and manufacturing
facilities are located in Orlando, Florida.
Results of Operations
Net Sales increased 4.4% to $4,568,397 for the quarter ended
December 31, 1997, compared to net sales of $4,376,126 for the
quarter ended December 31, 1996. Sales for the nine months ended
December 31, 1997 increased by 20.4% to $15,483,848, compared to
$12,864,562 for the same period in fiscal 1997. Sales for the
quarter have increased due to the introduction of new products to
the retail market and an increase in marketing activities to
promote these new products. In addition, there has been an
escalation of orders from major retail customers. The Company
expects increased sales for the fourth quarter as retail sales
continue to increase and foodservice sales improve with the
introduction of new equipment and product positions.
Cost of Goods Sold were $3,238,034 representing 70.9% of net
sales for the quarter ended December 31, 1997, compared with
$3,842,937 or 87.8% of net sales for the same period ended
December 31, 1996. For the nine month period ended December 31,
1997, cost of sales represented 76.1% of sales as compared to
86.1% for the same period in fiscal 1997. The Company was able
to improve gross margin by strategically eliminating selected
lower margin foodservice sales and re-balancing the product mix.
In addition, the company has been focusing its efforts on
production efficiencies to minimize the cost of sales percentage.
<PAGE>11
Selling expenses were $622,390 for the quarter ended December 31,
1997, compared with $564,895 for the same period ended December
31, 1996, an increase of 10.2%. In addition, selling expenses
for the nine months ended December 31, 1997 increased 11.2% to
$1,562,580 as compared to $1,404,974 for the nine months ended
December 31, 1996. The increase in expenses over the same period
a year ago is mainly attributed to the increase in sales, an
increase in marketing efforts resulting in initial product
introduction charges, and increased advertising and brokerage
costs associated with the increase in sales volume.
Delivery expenses increased 20.4% to $224,254 for the quarter
ended December 31, 1997, compared with $186,305 for the same
period ended December 31, 1996. For the nine months ended
December 31, 1997, delivery expenses increased 45.5% as compared
to the same period in fiscal 1997. The significant increase in
delivery costs is the direct result of an increase in sales to
retail customers across the country and internationally and an
increase in delivery costs overall for the industry.
General and Administrative expenses were $243,579 for the quarter
ended December 31, 1997, compared with $316,035 for the same
period ended December 31, 1996, a decrease of 22.9%. Conversely,
general and administrative expenses for the nine months ended
September 30, 1997 increased by $462 compared with the same
period in fiscal 1997. The decrease for the quarter ended
December 31, 1997 is attributable to a reduction in general and
administrative costs in an effort to bolster profitability as
well as the capitalization of certain expenses related to the
design and installation of the new foodservice equipment.
Research and Development expenses were $18,816 for the quarter
ended December 31, 1997, compared with $48,350 for the quarter
ended December 31, 1996, a decrease of 61.1%. These expenses
were $114,963 for the nine months ended December 31, 1997 as
compared to $153,953 for the nine months ended December 31, 1996.
The decrease in expenses during the third quarter is due to the
capitalization of development costs associated with the new
foodservice product positions.
Other Income and Expenses netted to $22,709 in expense for the
quarter ended December 31, 1997 as compared to $7,274 in income
for the quarter ended December 31, 1996. During the first three
quarters of fiscal 1998, interest expense was increased due to
the addition of the line of credit secured by the Company on
November 1, 1997. Additionally, during fiscal 1997, the Company
held marketable securities which earned interest income; these
marketable securities were partially sold during fiscal 1997 and
were completely liquidated as of June 30, 1997.
Liquidity and Capital Resources
Operating Activities -- Net cash provided by operating activities
was $773,711 for the nine months ended December 31, 1997 compared
to net cash used of $3,111,051 for the same period in fiscal
1997. This change in operating activities is the result of the
Company achieving profitability during fiscal 1998 following an
improvement in gross margin.
Investing Activities -- Net cash used in investing activities
totaled $1,036,493 for the nine months ended December 31, 1997
compared to net cash used of $3,079,581 for the same period in
fiscal 1997. The decline in cash used for investing activities
resulted from the purchase of marketable securities with cash
reserves from financing activities in the first quarter of fiscal
1997 and the subsequent sale of these securities during fiscal
1997 and in the first quarter of fiscal 1998. As of December 31,
1997, all marketable securities had been sold by the Company. In
addition, purchases of property and equipment were higher in
fiscal 1997 as a result of the introduction of new equipment for
the retail line.
<PAGE>12
Financing Activities -- Net cash provided by financing activities
was $265,675 for the nine months ended December 31, 1997 compared
to $6,081,685 for the same period in 1996.
On April 16, 1996, the Company completed a private placement of
1,337,524 shares of the Company's common stock at an aggregate
price of $2,000,000, and 4,000 shares of the Company's
convertible preferred stock at an aggregate price of $4,000,000.
On November 1, 1996, the Company secured a $2 million line of
credit with Finova Capital Corporation with interest at the prime
rate plus two percent. At December 31, 1997, the balance
outstanding under this line of credit agreement was $1,575,064.
On June 27, 1997, the Company secured a $1.5 million Purchase
Money Machinery and Equipment Accommodation with Finova Capital
Corporation to finance the acquisition of certain production
equipment. The agreement calls for interest at the prime rate
plus two percent. As of December 31, 1997, the balance
outstanding under this agreement was $1,446,562.
<PAGE>13
PART II. OTHER INFORMATION
GALAXY FOODS COMPANY
ITEM 6. Exhibits and Reports on Form 8-K
The following exhibits are filed as part of this Form 10-QSB.
Exhibit Exhibit Description
No.
*3.1 Certificate of Incorporation of the Company, as amended
(Filed as Exhibit 3.1 to the Company's Registration
Statement on Form S-18, No. 33-15893-NY, incorporated
herein by reference.)
*3.2 Amendment to Certificate of Incorporation of the
Company, filed on February 24, 1992 (Filed as Exhibit
4(b) to the Company's Registration Statement on Form S-
8, No. 33-46167, incorporated herein by reference.)
*3.3 By-laws of the Company, as amended (Filed as Exhibit
3.2 to the Company's Registration Statement on Form S-
18, No. 33-15893-NY, incorporated herein by reference.)
*3.4 Amendment to Certificate of Incorporation of the
Company, filed on January 19, 1994 (Filed as Exhibit
3.4 to the Company's Registration Statement on Form SB-
2, No. 33-80418, and incorporated herein by reference.)
*3.5 Amendment to Certificate of Incorporation of the
Company, filed on July 11, 1995 (Filed as Exhibit 3.5
on Form 10-KSB for fiscal year ended March 31, 1996,
and incorporated herein by reference.)
*3.6 Amendment to Certificate of Incorporation of the
Company, filed on January 31, 1996 (Filed as Exhibit
3.6 on Form 10-KSB for fiscal year ended March 31,
1996, and incorporated herein by reference.)
*10.1 1987 Stock Plan of the Company, as amended (Filed as
Exhibit 4(d) to the Company's Registration Statement on
Form S-8, No. 33-46167, incorporated herein by
reference.)
*10.2 Form of Non-Qualified Stock Option Agreement between
the Company and certain directors (Filed as Exhibit 10
(n) to the Company's Report on Form 10-KSB for fiscal
year ended March 31, 1988, and incorporated herein by
reference.)
*10.3 Form of Incentive Stock Option Agreement issued
pursuant to the Company's 1987 Stock Plan (Filed as
Exhibit 10 (o) to the Company's Report on Form 10-KSB
for fiscal year ended March 31, 1988, and incorporated
herein by reference.)
*10.4 1991 Non-Employee Director Stock Option Plan of the
Company (Filed as Exhibit 4 (g) to the Company's
Registration Statement on Form S-8, No. 33-46167,
incorporated herein by reference.)
*10.5 1991 Employee Stock Purchase Plan of the Company
(Filed as Exhibit 4 (h) to the Company's Registration
Statement on Form S-8, No. 33-46167, incorporated
herein by reference.)
* Previously filed
<PAGE> 14
Exhibit No Exhibit Description
No.
*10.6 Lease Agreement between ANCO Company and Company
dated as of November 13, 1991 (Filed as Exhibit 10 (bb)
to the Company's Report on Form 10-KSB for fiscal year
ended March 31, 1992, and incorporated herein by
reference.)
*10.7 Factoring Agreement, Assignment and Repurchase
Agreement, Security Agreement and Power of Attorney,
dated as of June 1, 1993, between the Company and
J.T.A. Factors, Inc. (Filed as Exhibit 10 (nn) to the
Company's Report on Form 10-QSB for the quarterly
period ended June 30, 1993.)
*10.8 Company's Registration Statement on Form S-8, Number
33-69546, filed September 28, 1993 (Filed as Exhibit
10.40 to the Company's Registration Statement on Form
SB-2, No. 33-80418, and incorporated herein by
reference.)
*10.9 Post-Effective Amendment No. 1 to Company's
Registration Statement on Form S-8, No. 33-69546, filed
October 28, 1993 (Filed as Exhibit 10.41 to the
Company's Registration Statement on Form SB-2, No. 33-
80418, and incorporated herein by reference.)
*10.10 Company's Registration Statement on Form S-8, No.
33-78684, filed May 6, 1994 (Filed as Exhibit 10.42 to
the Company's Registration Statement on Form SB-2, No.
33-80418, and incorporated herein by reference.)
*10.11 Post-Effective Amendment No. 1 to Company's
Registration Statement on Form S-8, No. 33-78684 (Filed
June 6, 1994, and incorporated herein by reference.)
*10.12 Company's Registration Statement on Form S-8, No.
33-81636 (Filed July 18, 1994, and incorporated herein
by reference.)
*10.13 Post-Effective Amendment No. 1 to Company's
Registration Statement on Form S-8, No. 33-81636 (Filed
August 10, 1994, and incorporated herein by reference.)
*10.14 Subscription for shares and investment letter, dated
November 4, 1994, between the Company and Angelo S.
Morini (Filed as Exhibit 10.122 on report 10-QSB, for
the quarterly period ended December 31, 1994, and
incorporated herein by reference.)
*10.15 Balloon promissory note, dated November 4, 1994
(Filed as Exhibit 10.123 on report 10-QSB, for the
quarterly period ended December 31, 1994, and
incorporated herein by reference.)
*10.16 Stock pledge and security agreement dated November
4, 1994 (Filed as Exhibit 10.124 on report 10-QSB, for
the quarterly period ended December 31, 1994, and
incorporated herein by reference.)
*10.17 First Amendment to Lease Agreement between ANCO
Company and the Company dated as of April 1, 1994
(Filed as Exhibit 10.76 on report 10-KSB for the fiscal
year ended March 31, 1995, and incorporated herein by
reference.)
*10.18 Consulting Agreement, dated March 15, 1995, between
Lee Chira and the Company (Filed as Exhibit 10.77 on
report 10-KSB for the fiscal year ended March 31, 1995,
and incorporated herein by reference.)
* Previously filed
<PAGE>15
Exhibit No Exhibit Description
*10.19 Consulting Agreement, dated March 15, 1995, between
Martin Consulting, Inc. and the Company (Filed as
Exhibit 10.78 on report 10-KSB for the fiscal year
ended March 31, 1995, and incorporated herein by
reference.)
*10.20 Selling Agreement, dated February 6, 1995, between
Sands Brothers & Co., Ltd. and the Company (Filed as
Exhibit 10.79 on report 10-KSB for the fiscal year
ended March 31, 1995, and incorporated herein by
reference.)
*10.21 Amendment Number 1 to Selling Agreement, dated
February 14, 1995, between Sands Brothers & Co., Ltd.
and the Company (Filed as Exhibit 10.80 on report 10-
KSB for the fiscal year ended March 31, 1995, and
incorporated herein by reference.)
*10.22 Amendment Number 2 to Selling Agreement, dated March
8, 1995, between Sands Brothers & Co., Ltd. and the
Company (Filed as Exhibit 10.81 on report 10-KSB for
the fiscal year ended March 31, 1995, and incorporated
herein by reference.)
*10.23 Consulting agreement between the Company and Koi
Communications Corporation, dated June 1, 1995. (Filed
as Exhibit 10.82 on report 10-QSB for the quarterly
period ended June 30, 1995, and incorporated herein by
reference.)
*10.24 Employment Agreement dated as of October 10, 1995,
by and between the Company and Angelo S. Morini (Filed
as Exhibit 10.83 on report 8-K, and incorporated herein
by reference.)
*10.25 Balloon Promissory Note dated as of October 11,
1995, by Angelo S. Morini in favor of the Company
(Filed as Exhibit 10.84 on report 8-K, and incorporated
herein by reference.)
*10.26 Stock Pledge and Security Agreement dated as of
October 11, 1995, by and between the Company and Angelo
S. Morini (Filed as Exhibit 10.85 on report 8-K, and
incorporated herein by reference.)
*10.27 Consulting agreement between the Company and
Marshall K. Luther dated August 28, 1995 (Filed as
Exhibit 10.86 on Form 10-QSB/A for the nine months
ended December 31, 1995, and incorporated herein by
reference.)
*10.28 Amendment to Factoring Agreement (original agreement
dated June 1, 1993) dated January 29, 1996 between the
Company and J.T.A. Factors, Inc. (Filed as Exhibit
10.28 on Form 10-KSB for fiscal year ended March 31,
1996, and incorporated herein by reference.)
*10.29 1996 Amendment and Restatement of the 1991 Non-
Employee Director Stock Option Plan (Filed as Exhibit
10.29 on Form 10-KSB for fiscal year ended March 31,
1997, and incorporated herein by reference.)
*10.30 1996 Stock Plan (Filed as Exhibit 10.30 on Form 10-
KSB for fiscal year ended March 31, 1997, and
incorporated herein by reference.)
* Previously file
<PAGE>16
Exhibit Exhibit Description
No.
*10.31 Line of Credit Agreement with Finova Financial
Services (Filed as Exhibit 10.31 on Form 10-KSB for
fiscal year ended March 31, 1997, and incorporated
herein by reference.)
*10.32 Second Amendment to the Lease Agreement between ANCO
Company and the Company dated as April 1, 1994 (Filed
as Exhibit 10.32 on Form 10-KSB for fiscal year ended
March 31, 1997, and incorporated herein by reference.)
*10.33 Purchase Money Accommodation for the Purchase of
Specific Equipment with FINOVA Financial Services
(Filed as exhibit 10.33 on Form 10-QSB for quarter
ended June 30, 1997, and incorporated herein by
reference.)
27 Financial Data Schedule (Filed herewith.)
Reports on Form 8-K
No reports on Form 8-K were filed during the three or
nine months ended December 31, 1997.
* - Previously filed
<PAGE>17
SIGNATURES
In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
GALAXY FOODS COMPANY
Date: January 28, 1998 /s/Angelo S. Morini
Angelo S. Morini
Chairman and President
(Principal Executive Officer)
Date: January 28, 1998 /s/Cynthia L. Hunter
Cynthia L. Hunter, CPA
Chief Financial Officer
(Principal Financial and
Accounting Officer)
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<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> DEC-31-1997
<CASH> 19,378
<SECURITIES> 0
<RECEIVABLES> 2,470,375
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