As filed with the Securities and Exchange Commission on May 23, 1997
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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SENECA FOODS CORPORATION
(Exact name of registrant as specified in its charter)
New York 16-0733425
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1162 Pittsford-Victor Road
Pittsford, New York 14534
(716) 385-9500
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
KRAIG H. KAYSER
President and Chief Executive Officer
1162 Pittsford-Victor Road
Pittsford, New York 14534
(716) 385-9500
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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Copies to:
WILLIAM I. SCHAPIRO, Esq.
Jaeckle Fleischmann & Mugel, LLP
800 Fleet Bank Building
Buffalo, New York 14202
(716) 856-0600
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Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
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If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 (the "Securities Act"), other than securities offered only in connection
with dividend or interest reinvestment plans, check the following box. X
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<TABLE>
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CALCULATION OF REGISTRATION FEE
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<CAPTION>
Proposed Maximum Proposed Maximum
Title of Each Class Amount to be Offering Price Aggregate Amount of
to be Registered Registered Per Share (1) Offering Price Registration Fee
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<S> <C> <C> <C> <C>
Shares of Class A Common Stock,
par value $0.25 per share................ 346,570 $17.125 $5,935,011 $1,788.49
====================================================================================================================================
<FN>
(1) Estimated solely for the purpose of determining the registration fee in
accordance with Rule 457(c) under the Securities Act on the basis of the
average of the high and low price of the Registrant's Class A Common
Stock, as reported by the NASDAQ National Market on May 20, 1997 which was
$17.125.
</FN>
</TABLE>
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The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act or until the Registration Statement shall
become effective on such date as the Commission, acting pursuant to said Section
8(a), may determine.
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PROSPECTUS
346,570 Shares
SENECA FOODS CORPORATION
Class A Common Stock
All of the shares of Class A Common Stock, $0.25 par value per share
("Class A Common Stock") of Seneca Foods Corporation (the "Company") offered
hereby (the "Offering") are being sold by The Pillsbury Company, a Delaware
corporation ("Pillsbury" or the "Selling Security Holder"). See "Selling
Security Holder" and "Risk Factors -- Leverage Considerations." The Company will
receive no portion of the proceeds of the Offering. The Company's Class A Common
Stock is traded in the over-the-counter market and quoted on the NASDAQ National
Market under the symbol "SENEA" On May 20, 1997, the average of the high and low
price of the Class A Common Stock as reported by the NASDAQ National Market was
$17.125 per share.
See "Risk Factors" on page 4 for a discussion of certain factors that
should be considered by prospective purchasers of the Class A Common Stock
offered hereby.
------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
------------------------------------
THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED ON
OR ENDORSED THE MERITS OF THIS OFFERING.
ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
------------------------------------
The date of this Prospectus is ______________, 1997.
No dealer, salesmen or other person has been authorized to give any
information or to make any representation not contained or incorporated by
reference in this Prospectus, and any information or representation not
contained or incorporated by reference herein must not be relied upon as having
been authorized by the Company. This Prospectus does not constitute an offer to
sell, or a solicitation of any offer to buy, any of the securities offered
hereby in any jurisdiction to any person whom it is unlawful to make such offer
or solicitation. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create any implication that the
information herein is correct as of any date subsequent to the date hereof or
that there has been no change in the affairs of the Company since such date or,
in the case of information incorporated herein by reference, the date of filing
with the Securities and Exchange Commission (the "Commission").
---------------------------
TABLE OF CONTENTS
Page
AVAILABLE INFORMATION........................................................ 2
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE............................. 3
RISK FACTORS................................................................ 4
THE COMPANY................................................................. 12
SELLING SECURITY HOLDER..................................................... 13
PLAN OF DISTRIBUTION........................................................ 13
DESCRIPTION OF CAPITAL STOCK................................................ 14
LEGAL MATTERS............................................................... 19
EXPERTS ................................................................... 20
---------------------------
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934 ("Exchange Act") and, in accordance therewith,
files reports and other information with the Commission. Such reports and other
information can be inspected and copied at the public reference facilities
maintained by the Commission at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the following Regional Offices of the Commission:
Midwest Regional Office, Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661 and Northeast Regional Office, Seven World Trade Center,
Suite 1300, New York, New York 10048. Copies of such material can also be
obtained from the Public Reference Section of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549 at prescribed rates. The Commission
maintains a Web site that contains reports, proxy and information statements and
other information regarding registrants that file electronically with the
Commission. The Commission's Web site can be found at http://www.sec.gov.
The Class A Common Stock is listed on the NASDAQ National Market and
reports, proxy statements and other information concerning the Company may be
inspected at the offices of the National Association of Securities Dealers,
Inc., 1735 K Street, N.W., Washington, D.C.
20006.
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<PAGE>
The Company has filed with the Commission a Registration Statement on
Form S-3 (the "Registration Statement") under the Securities Act of 1933
("Securities Act"), with respect to the Class A Common Stock offered hereby. The
Prospectus does not contain all of the information set forth in the Registration
Statement and the exhibits and schedules thereto (certain parts of which have
been omitted in accordance with the rules and regulations of the Commission).
For further information with respect to the Company and the Class A Common Stock
offered hereby, reference is made to the Registration Statement and to the
exhibits filed as a part thereof. Statements contained in this Prospectus as to
the contents of any contract, agreement or any other document are not
necessarily complete, and, in each instance, reference is made to the copy of
such document filed as an exhibit to the Registration Statement or otherwise
with the Commission, each such statement being qualified in all respects by such
reference, schedules and exhibits. The Registration Statement including all
exhibits thereby may be inspected without charge at the Commission's principal
office in Washington, D.C., and copies of all or any part thereof may be
obtained from such office after payment of the fees prescribed by the
Commissioner.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents heretofore filed by the Company with the
Commission are incorporated by reference in this Prospectus:
1. Annual Report on Form 10-K for the fiscal year ended March 31, 1996.
2. Quarterly Report on Form 10-Q for the fiscal quarter ended June 29,
1996.
3. Quarterly Report on Form 10-Q for the fiscal quarter ended
September 28, 1996.
4. Quarterly Report on Form 10-Q for the fiscal quarter ended December
28, 1996.
5. All other reports filed with the Commission by the Company
pursuant to Sections 13(a) or 15(d) of the Exchange Act, as
amended since March 31, 1996 and prior to the date of this
Prospectus.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Exchange Act, after the date of this Prospectus and prior to
the termination of the Offering shall be deemed to be incorporated by reference
into this Prospectus and to be a part of this Prospectus from the respective
dates of the filing of such documents. The Company will provide without charge
to each person to whom this Prospectus is delivered, on the written or oral
request of such person, a copy of any or all of the documents incorporated by
reference herein (other than exhibits not specifically incorporated by reference
into the text of such documents). Requests should be directed to Devra A.
Bevona, Treasurer, Seneca Foods Corporation, 1162 Pittsford-Victor Road,
Pittsford, New York 14534 (telephone (716) 385-9500).
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<PAGE>
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained in this
Prospectus or in any other subsequently filed document which also is or is
deemed to be incorporated herein by reference modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus.
RISK FACTORS
PROSPECTIVE PURCHASERS OF THE CLASS A COMMON STOCK OFFERED HEREBY SHOULD
CONSIDER CAREFULLY THE FOLLOWING CONSIDERATIONS, AS WELL AS THE OTHER
INFORMATION APPEARING ELSEWHERE IN THIS PROSPECTUS, IN EVALUATING AN INVESTMENT
IN THE CLASS A COMMON STOCK.
Industry Conditions and Price and Volume Fluctuations
The Company's financial performance and growth are related to
conditions in the food processing industry, particularly the vegetable
processing industry. The United States vegetable processing industry is a mature
industry, with a relatively modest 1.8% compounded annual growth rate from 1988
to 1993. The Company's net sales are a function of product availability and
market pricing. In the vegetable processing industry, product availability and
market prices tend to have an inverse relationship: market prices tend to
decrease as more product is available, whereas if less product is available,
market prices tend to increase. Product availability is a direct result of
plantings, growing conditions, crop yields and inventories, all of which vary
from year to year. In addition, market price can be affected by the planting,
inventory level and individual pricing decisions of the three or four largest
processors in the industry. Generally, the market prices in the vegetable
processing industry tend to adjust more quickly to variations in product
availability than an individual processor can adjust its cost structure; thus,
in an oversupply situation, a processor's margins likely will weaken, as
suppliers generally are not able to adjust their cost structure as rapidly as
market prices adjust for the over-supply. The Company typically has experienced
lower margins during times of industry over-supply. There can be no assurance
that the Company's margins will improve in response to favorable market
conditions or that the Company will be able to operate profitably during
depressed market conditions. See "Risk Factors -- Losses Incurred In The 1996
Fiscal Year."
Dependence on Alliance Agreement
In connection with the acquisition by the Company of certain assets of
the Green Giant(R) Division of Pillsbury, the Company entered into a 20 year
First Amended and Restated Alliance Agreement dated December 8, 1994 and amended
on February 10, 1995 (the "Alliance Agreement") with Pillsbury and Grand
Metropolitan Incorporated ("GMI"), the parent of Pillsbury and a wholly-owned
subsidiary of Grand Metropolitan plc. Pursuant to the Alliance
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<PAGE>
Agreement, the Company will process and sell to Pillsbury on a "cost plus" basis
cases of shelf-stable vegetables and process or partially process certain
frozen vegetables and asparagus for Pillsbury.
In a transaction concurrent with the Alliance Agreement, the Company
acquired from Pillsbury a substantial percentage of tangible assets used by
Pillsbury for the production of its Green Giant(R) brand of shelf-stable and
frozen vegetable products, including six plants located in the midwestern and
northwestern United States (the "Alliance Plants"). Five Green Giant(R)
production plants were retained by Pillsbury with the intention to close them.
The purchase price for the acquired assets was $86.1 million, in payment of
which the Company paid Pillsbury $13.1 million in cash and issued to Pillsbury
an 8% Secured Nonrecourse Subordinated Promissory Note due September 30, 2009
(the "Pillsbury Note") in the principal amount of $73,025,000. The Company
acquired additional Pillsbury assets in 1996, and, as a result, the principal
amount of the Pillsbury Note was increased by $7,558,000. The Pillsbury Note
requires the Company to pay annual installments of principal and a final major
principal payment on September 30, 2009. Interest on the Pillsbury Note is
required to be paid quarterly on each of the last days of March, June, September
and December. As a result of Pillsbury's conversion of two principal
installments totalling $6,000,000 into the Offered Shares (see "Selling Security
Holder -- Pillsbury's Acquisition of the Offered Shares"); the next principal
installment on the Pillsbury Note is due October 20, 1997, and the outstanding
principal balance at December 28, 1996 is $74,583,000.
Inasmuch as Pillsbury will have sold to the Company or closed
substantially all of its Green Giant(R) production facilities and hopes to
benefit under the Alliance Agreement by paying lower product costs than it might
otherwise incur, both parties expect the Company to be a major supplier of
Pillsbury's Green Giant(R) vegetable products. Green Giant(R) products packed by
the Company in the Company's fiscal year ended March 31, 1996 and the nine-month
period ended December 28, 1996 constituted approximately 30% and 59%,
respectively, of the Company's sales for such period. The Company expects that,
in the foreseeable future while the Alliance Agreement remains in effect, Green
Giant(R) vegetables will be the largest single product line of the Company.
During the Company's 1997 fiscal year, the Company and Pillsbury entered into an
agreement pursuant to which the Company was permitted to sell Green Giant(R)
products to an intervening buyer, which made agreements for the sale of those
products to Pillsbury.
The Alliance Agreement contains detailed provisions for determining
fixed and variable manufacturing costs (including amortization of certain
capital expenditures mutually agreed upon), warehousing costs, and costs of
ancillary and special services requested by Pillsbury and provides for payment
of certain fees to the Company. The parties intend that the result of all
payments made each fiscal year by Pillsbury to the Company, exclusive of
incentive payments described below, will result in the Company's having realized
a recovery of its allowed costs, plus a profit on its sales to Pillsbury. The
Company and Pillsbury have not publicly disclosed the profit targets, as they
believe that disclosure would give competitors an unfair advantage. For the
periods through March 31, 2000, Pillsbury will pay to the Company certain annual
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<PAGE>
incentive payments which constitute a specified portion of any cost savings
achieved by the Company and passed on to Pillsbury over targeted cost savings
fixed by the parties for each such year.
The Alliance Agreement has an initial term ending December 31, 2014,
and will be automatically extended for additional five year terms unless
terminated in accordance with the provisions of the Alliance Agreement. Under
virtually all of the causes of termination enumerated in the Alliance Agreement,
transfer to Pillsbury of legal title to the Alliance Plants and certain of the
other assets which the Company acquired from Pillsbury and various financial
adjustments between the parties will occur. Pillsbury holds mortgage and
security interests in the property transferred to the Company and any
replacement property to enforce its rights under the Alliance Agreement and the
Pillsbury Note. Pillsbury will look to that property, and not to the other
property of the Company, to satisfy its claims under the Pillsbury Note (except
for damages in certain circumstances, such as the Company's fraud or intentional
misconduct or its failure to turn over insurance or condemnation proceeds of the
secured property or its failure to turn over the property as required by the
Pillsbury Note or its failure to comply with the termination provisions of the
Alliance Agreement). The Pillsbury Note has extensive provisions defining
relative rights and remedies against the Company of Pillsbury and of the
Company's long-term insurance lenders and revolving credit bank lenders in
certain circumstances such as default by the Company.
Termination of the Alliance Agreement will, in most cases, entitle the
Company's principal lenders, including long-term insurance lenders and revolving
credit bank lenders (and other bank lenders whose loan agreements incorporate
the default provisions of the Company's revolving credit agreement), to declare
a default under the Company's loan agreements with them. The principal lenders
have a security interest in certain payments to be received by the Company from
Pillsbury on termination of the Alliance Agreement. Unless the Company were to
enter into a new substantial supply relationship with Pillsbury or another major
vegetable marketer and acquire substantial production capacity to replace the
Alliance Plants, any such termination would very substantially reduce the
Company's sales. If termination were to occur while substantial indebtedness of
the Company to its insurance lenders and revolving credit bank lenders were
outstanding, a restructuring of the debt payment terms might be necessary to
avoid a payment default.
The Company's sales and financial performance under the Alliance
Agreement and its sales of Green Giant(R) products will depend to a significant
extent on the Company's success in producing quality Green Giant(R) vegetables
at competitive prices and Pillsbury's success in marketing the products produced
by the Company. The ability of Pillsbury to successfully market these products
will depend upon its sales force, as well as the factors described above under
"Risk Factors -- Industry Conditions and Price and Volume Fluctuations." The
Company cannot give assurance as to the volume of Pillsbury's sales and cannot
control many of the key factors affecting that volume. Further, the Alliance
Agreement contains extensive covenants by the Company with respect to quality
and delivery of products, maintenance of the Alliance Plants and other standards
related to performance. If the Company were to fail in its performance of
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<PAGE>
these covenants, Pillsbury would be entitled to terminate the Alliance
Agreement. There can be no assurance that the Company will successfully perform
its obligations under the Alliance Agreement so as not to permit a termination
of the Alliance Agreement by Pillsbury.
Losses Incurred in the 1996 Fiscal Year
The 1995 packing season, which occurred in the Company's fiscal year
ended March 31, 1996, resulted in an after-tax loss of $10,147,000 for the
Company. The major causes of the losses were:
(1) Reduced production, particularly in the Company's Eastern
Division vegetable plants. The Company experienced start-up problems
during and after installation of new equipment and relocation and
modification of existing Pillsbury equipment which was removed from
closed Pillsbury plants and installed in Company plants. The Company
made aggregate capital expenditures of $67,897,000 involving 37
separate projects to prepare for a larger volume pursuant to the
Alliance Agreement. The magnitude of that capital program, which had to
be completed in approximately six months' time to be ready for the 1995
pack season, exceeded any prior capital program by the Company within a
comparable period of time. During the 1996 packing season, the Eastern
Division plants, which had generated the greatest problems in 1995,
generally performed in accordance with the Company's expectations.
(2) During the summer of 1995, operations in the Eastern
Division (New York plants) were adversely affected by the worst drought
in New York in 20 years, which further reduced Eastern Division
vegetable production.
The combination of these two factors resulted in a non-recurring charge of
$15,078,000, before income tax benefit, for the 1996 fiscal year.
The 1996 fiscal year was the first year of operation under the Alliance
Agreement. The Company did not receive orders from Pillsbury at the
originally-anticipated levels because of the existence of substantial Green
Giant(R) vegetable inventories carried over from the prior (pre-Alliance
Agreement) year. Consequently, the Company substantially increased its finished
inventory levels and had to defer the conversion of inventory to sales. This
adversely affected the Company's cash flow and income and necessitated a
modification of certain financial covenants in the Company's loan agreements
with its revolving credit bank lenders and its insurance lenders, as the Company
could not have complied with the unmodified covenants.
As a fruit processor, the Company's profit margins are also affected by
fluctuations in fruit prices, which have affected the Company's operating
margins throughout its history. The Company produces approximately two-thirds of
the apple concentrate which it uses in its own products and purchases the
remainder from apple-producing regions throughout the world. During the two-year
period ended March 31, 1997, apple concentrate was in relatively short
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supply, and its cost increased substantially. Consumer demand for apple juice is
price-sensitive, so that, in periods of high concentrate costs, the Company
cannot raise selling prices high enough to maintain its desired profit margins
without sacrificing sales volume. The disparity between cost of supply and
selling price adversely affected the Company's frozen apple juice profit margins
during the two-year period ended March 31, 1997. The high apple concentrate
prices in mid-1997 are expected to adversely affect apple juice revenues for at
least the first half of fiscal year 1998. Thereafter, the direction of apple
concentrate prices will be alternately affected by the autumn apple harvests in
the Northern Hemisphere and March to May harvests in the Southern Hemisphere.
See "Risk Factors -- Industry Conditions and Price and Volume Fluctuations."
Nine-Month Period Ended December 28, 1996. In the 1997 fiscal year, the
Company's unaudited financial results through the first nine months ended
December 28, 1996, showed income before income taxes of $12,606,000 as compared
to a loss of $15,267,000 in the comparable nine months of the 1996 fiscal year.
The December 28, 1996 income includes gain on the sale of Moog Inc. common stock
of $7,501,000 and gain on the sale of a warehouse of $1,640,000. The prior
period results include gain on the sale of a warehouse of $4,279,000 and the
non-recurring charge of $15,078,000, before income tax benefit, mentioned above.
Leverage Considerations
The purchase of the Alliance Plants, the cost of the substantial
capital improvements effected prior to the 1995 packing season and the
significant increase in the Company's working capital requirements to produce
and hold large inventories of products packed for Pillsbury under the Alliance
Agreement, has resulted not only in substantially increased sales, but has also
increased Company debt and total debt relative to total assets. The following
table illustrates the increased leverage position of the Company at the fiscal
year and period-end dates listed below.
<TABLE>
<CAPTION>
December 28,
1996 March 31, March 31, July 31,
(unaudited) 1996 1995 1994
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<S> <C> <C> <C> <C>
Total outstanding debt (000 omitted) $259,703 $340,264 $227,074 $59,425
Current ratio 2.07:1.00 1.57:1.00 3.21:1.00 2.22:1.00
(current assets:current liabilities)
Ratio of total assets to total liabilities 1.26:1.00 1.21:1.00 1.31:1.00 1.76:1.00
Long-term debt/equity 245% 249% 244% 58%
Total liabilities/equity 388% 476% 324% 131%
</TABLE>
To reduce the current relative level of debt, in the last quarter of
fiscal year 1996, the Company consummated a transaction whereby Pillsbury
converted $6,000,000 of the Company's principal indebtedness to Pillsbury under
the Pillsbury Note into Class A Common Stock of the Company (which is the stock
being sold in the Offering). Also, in the first quarter of the fiscal
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year ended March 31, 1997, the Company sold for $12,863,000 a portion of its
investment in the stock of Moog Inc., realizing a gain of $7,501,000 before
income tax and expenses.
The Alliance Agreement does not require Pillsbury to adhere to any
particular schedule of interim purchases of inventory; however, Pillsbury is
required to purchase from the Company, by various specified dates, all remaining
unpurchased inventory which was packed for Pillsbury in the preceding fiscal
year's pack plan. These required purchase dates, which differ for particular
products, occur on various dates from April 1 through October 1 following the
fiscal year of the pack. From time to time the Company has accelerated the sale
inventories of finished goods packed for Pillsbury by selling the goods to an
unrelated investor which owned the goods until it affected their subsequent sale
to Pillsbury. The Company is anticipating similar transactions in the future to
accelerate sales of Green Giant(R) goods and reduce its working capital
requirements, but it can give no assurance that these transactions will be
consummated.
The terms and conditions of the Company's revolving credit facility and
the other indebtedness of the Company currently impose restrictions that affect,
among other things, the ability of the Company to incur debt, create liens, pay
dividends, make acquisitions and make capital expenditures. Terms of the
Company's indebtedness also require it to satisfy certain financial covenants on
a monthly basis. The ability of the Company to make cash payments to satisfy its
indebtedness and to comply with such financial or similar covenants as may be
contained in future agreements will depend upon its future operating
performance, which is subject to prevailing economic conditions, and to
financial, business and other factors beyond the Company's control. See "Risk
Factors -- Dependence on Alliance Agreement," and "-- Losses Incurred in the
1996 Fiscal Year" immediately preceding this paragraph. In addition, the
Company's debt service obligations and related financial and operating covenants
could limit its ability to withstand competitive pressures or a downturn in its
business or in the economy.
Seasonality and Quarterly Fluctuations
The Company's operations are affected by the growing cycle of the
vegetables it processes. When the vegetables are ready to be picked, the Company
must harvest and process the vegetables or forego the opportunity to process
fresh picked vegetables for an entire year. Most of the Company's vegetables are
grown by farmers under contract to the Company. Consequently, the Company must
pay the contract grower for the vegetables even if the Company cannot or does
not harvest or process them. Most of the Company's production occurs during the
second quarter of each fiscal year (due to the timing of crop production and
climate conditions) and a majority of sales occur during the third and fourth
quarter of each fiscal year (due to seasonal consumption patterns for its
products). Accordingly, inventory levels are highest during the second and third
quarters, and accounts receivable levels are highest during the third and fourth
quarters. Net sales generated during the third and fourth quarters of each
fiscal year have a significant impact on the Company's results of operations.
Because
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<PAGE>
of seasonal fluctuations, there can be no assurance that the results of any
particular quarter will be indicative of results for the full year or for future
years.
Competition
All of the Company's products compete with those of other national,
major and smaller regional food processing companies under highly competitive
conditions. Some of the Company's major competitors are Del Monte Corporation
and Dean Foods in the vegetable business. The Company also sells vegetable
products which may compete with products manufactured for Pillsbury under the
Alliance Agreement or by other companies. The Company's competitors in the fruit
juice business and fruit products include the Minute Maid division of Coca-Cola
Company, the Mott's product line of Cadbury-Schweppes plc, Tropicana Products,
Ocean Spray, TreeTops and others. All of the competitors specifically identified
in this paragraph have greater sales and assets than the Company. Continued
industry consolidation also may increase the market strength of the Company's
larger competitors.
Each of the Shares Being Offered Has Low Voting Power
Each share of Class A Common Stock has one-twentieth (1/20) of one vote
on all matters requiring a shareholder vote, while each share of Class B Common
Stock, $0.25 par value per share ("Class B Common Stock"), as well as each share
of the Company's outstanding preferred stock, has one vote. As of the date of
this offering, the families of Arthur S. Wolcott and Kraig H. Kayser (the
"Wolcott and Kayser Families" or the "Wolcott or Kayser Families") collectively
exercise approximately 50% of the total voting power of the Company. This
capital structure and the concentrated ownership of the Wolcott and Kayser
Families in the Class B Common Stock and the Company's preferred stock are
likely to limit or preclude the chances of success for a tender offer or other
takeover proposal or proxy contest which could remove directors if the Wolcott
and Kayser Families are opposed. Accordingly, there is a diminished possibility
of the shareholders receiving and accepting hostile takeover bids, which are
usually made at premiums over then-current market prices of the target company
stock. Moreover, in the election of directors and other matters which are not
subject to a class vote, holders of Class A Common Stock have substantially less
voting power than holders of the Class B Common Stock proportionate to the
relative market value of those two classes of stock. See "Description of Capital
Stock -- Description of Class A Common Stock and Class B Common Stock --
Voting."
Certain Anti-Takeover Provisions
Certain provisions of the Alliance Agreement and the Company's credit
facilities, Charter and Bylaws could have the effect of preventing or delaying a
person from acquiring or seeking to acquire a substantial equity interest in, or
control of, the Company. The Bylaws and Charter provide, among other things, for
staggered board of directors' terms. See "Description of
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Capital Stock -- Restrictions on Acquisition of the Company -- Certain Charter
and Bylaw Provisions." The Alliance Agreement states that it may be terminated
by Pillsbury if any person acquires 30% or more of the combined voting power of
the Company's then outstanding voting securities, or the shareholders of the
Company approve certain specified business transactions. The Company's long term
credit facility provides that certain lenders may require the Company to prepay
certain of its indebtedness if (i) any person or group (other than directly or
indirectly through the Wolcott or Kayser Families) acquires shares of the
Company representing more than 50% of the total number of votes which the
Company's Shareholders shall be entitled to cast in the election of directors;
or (ii) the Wolcott and Kayser Families shall cease to own, directly or
indirectly, at least 25% of the Company. The Company's revolving credit facility
provides that an event of default occurs if (i) any person or group, other than
the Wolcott or Kayser Families, acquires capital stock possessing either 30% or
more of the total number of votes which the Company's shareholders shall be
entitled to cast or the right to elect 30% or more of the Company's Board of
Directors, or (ii) during any period of 12 consecutive months, the individuals
who at the beginning of such 12 month period were directors of the Company cease
for any reason to constitute a majority of the Board of Directors of the
Company.
No Dividends
The Company has historically not declared or paid any cash dividends on
its shares of common stock, and does not anticipate paying such dividends in the
foreseeable future. Furthermore, the Company's multi-year credit facilities
restrict, and future credit agreements may restrict, the payment of dividends
without lender permission. See "Risk Factors -- Leverage Considerations."
Dependence on Key Personnel
The Company's success is dependent to a great extent on its current
management team and other key personnel, the loss of one or more of whom could
have a material adverse effect on the Company. The Company does not maintain key
person life insurance policies on any of its executive officers.
Regulation
United States and foreign governmental laws, regulations and policies
directly affect the agricultural industry and the vegetable processing industry.
The Company is subject to regulation by the Food and Drug Administration, the
United States Department of Agriculture, the Federal Trade Commission, the
Environmental Protection Agency and various state agencies with respect to the
production, packaging, labeling and distribution of its food products. In
addition, the disposal of solid and liquid vegetable waste material resulting
from the preparation and processing of foods is subject to various federal,
state and local laws and regulations relating
- 11 -
<PAGE>
to the protection of the environment. In some international markets, there are
regulations and policies designed to discourage the importation of agricultural
commodities. The application or modification of existing, or the adoption of new
laws, regulations or policies could have an adverse effect on the Company's
business and results of operations.
THE COMPANY
The Company, a New York corporation, conducts its business almost
entirely in food processing which currently contributes approximately 99% of the
Company's sales. The Company is a leading producer of canned and frozen
vegetables, apple products, grape products and bottled, canned and frozen fruit
juice drinks. For the fiscal year ended March 31, 1996, canned and frozen
vegetables represented approximately 66% of the Company's food processing volume
and the apple products category contributed 17% of the Company's processed food
sales. The Company's Seneca(R) brand frozen apple concentrate continues its
position as the nation's number one seller. Of the remaining food processing
sales, grape products accounted for 4% and bottled, canned, and frozen fruit
juice drinks accounted for the remaining 13% in the March 31, 1996 fiscal year.
The Company sells its products to retail and institutional markets. The
products sold in retail markets are sold (i) under the Company's own brands,
including Seneca(R), Libby's(R), Nature's Favorite(R) and TreeSweet(R), (ii)
under private labels, including food markets' private brands and brands of other
producers and distributors of food products and (iii) under the brand name Green
Giant(R) pursuant to agreements with Pillsbury. See "Risk Factors -- Dependence
on Alliance Agreement."
In the Company's fiscal year ended March 31, 1996, the Company's
revenues from food products sales were attributable approximately 26% to its own
brands, 31% to private labels, 33% to Pillsbury and 10% to institutional food
distributors.
The Company also operates a non-food division, Seneca Flight
Operations, which provides air charter service primarily to industries located
in upstate New York. Seneca Flight Operations contributes approximately 1% to
the Company's sales.
- 12 -
<PAGE>
<TABLE>
SELLING SECURITY HOLDER
<CAPTION>
Number of Shares
Number of Shares Number of Shares of Class A Common
of Class A Common of Class A Stock Assuming
Name of Selling Stock Owned as of Common Stock to be Sale of Shares
Security Holder May 23, 1997 Registered Registered Hereunder
- --------------- ----------------- ------------------ --------------------
<S> <C> <C> <C>
The Pillsbury Company 346,570 346,570 0
The shares to be registered constitute approximately 11% of the outstanding
Class A Common Stock of the Company.
</TABLE>
Pillsbury's Acquisition of the Offered Shares
The Offered Shares are owned by Pillsbury and were issued to Pillsbury
by the Company on March 20, 1996, pursuant to Pillsbury's exercise of an option
granted to it on September 28, 1995, to convert $6,000,000 principal amount of
indebtedness owed by the Company on the Pillsbury Note into Class A Common
Stock. The option was exercised on December 21, 1995, at an exercise price of
$17.3125 per share. The indebtedness so converted constituted the first two
installments of principal, each installment in the sum of $3,000,000. The two
principal installments converted to Class A Common Stock were originally due on
October 20, 1995 and 1996, respectively.
PLAN OF DISTRIBUTION
The Offered Shares are offered for the Selling Security Holder or for
the account of pledgees, donees, transferees or other successors in interest of
the Selling Security Holder. Such sales may be made on the NASDAQ National
Market at prices and at terms then prevailing or at prices related to the
then-current market price, or in negotiated transactions. Such transactions may
include, but are not limited to, one or more of the following: (i) a block trade
in which the broker or dealer so engaged will attempt to sell the Offered Shares
as an agent, but may position and resell a portion of the block as principal to
facilitate the transaction; (ii) purchases by a broker or dealer for its account
pursuant to this Prospectus; or (iii) ordinary brokerage transactions and
transactions in which the broker solicits purchases. In effecting sales, brokers
or dealers engaged by the Selling Security Holder may arrange for other brokers
or dealers to participate. In the event of a transaction hereunder in which a
broker or dealer acts as a principal (other than to facilitate an installment
sale transaction, or to a market maker acting
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<PAGE>
as such in routine transactions in the over-the-counter market), this Prospectus
will be supplemented to provide material facts with respect to such transaction.
Brokers or dealers involved in sales hereunder will receive commissions
or discounts from the Selling Security Holder in amounts to be negotiated
immediately prior to the sale. Such brokers or dealers and any other
participating brokers or dealers may be deemed to be "underwriters" within the
meaning of the Securities Act, in connection with such sales, and any profits or
commissions earned by them in such transactions may be deemed to be underwriting
discounts or commissions under the Securities Act. The Selling Security Holder
has been advised that it is subject to the applicable provisions of the Exchange
Act, including without limitation, Rules 10b-5, 10b-6 and 10b-7 thereunder.
DESCRIPTION OF CAPITAL STOCK
The Company is authorized to issue 10,000,000 shares of Class A Common
Stock, 10,000,000 shares of Class B Common Stock (Class A Common Stock and Class
B Common Stock collectively are referred to as "Common Stock"), 200,000 shares
of Six Percent (6%) Voting Cumulative Preferred Stock, $0.25 par value per share
("6% Preferred Stock"), 30,000 shares of Preferred Stock Without Par Value,
1,000,000 shares of Ten Percent (10%) Cumulative Convertible Voting Preferred
Stock - Series A Preferred Stock, $0.25 stated value per share ("10% Series A
Preferred Stock") and 400,000 shares of Ten Percent (10%) Cumulative Convertible
Voting Preferred Stock - Series B Preferred Stock, $0.25 stated value per share
("10% Series B Preferred Stock") (the 6% Preferred Stock, No Par Value Preferred
Stock, 10% Series A Preferred Stock and 10% Series B Preferred Stock are
collectively referred to as "Preferred Stock"). The Company currently has issued
and outstanding: 3,143,125 shares of Class A Common Stock, 2,796,555 shares of
Class B Common Stock, 200,000 shares of 6% Preferred Stock, 407,240 shares of
10% Series A Preferred Stock and 400,000 shares of 10% Series B Preferred Stock.
Description of Class A Common Stock and Class B Common Stock
Voting. Under the Company's Charter, the holders of Class A Common
Stock and Class B Common Stock have the right to vote for the election of all
directors and on all other matters submitted to the shareholders of the Company.
Subject to the Class A Special Rights discussed in detail below, each share of
Class B Common Stock is entitled to one full vote on all matters on which
shareholders currently are entitled to vote, including the election of
directors. Each holder of Class A Common Stock is entitled to one-twentieth
(1/20) of one vote per share on all matters on which shareholders are entitled
to vote, including the election of directors. Cumulative voting is not
authorized for the holders of Common Stock. See "Risk Factors -- Each of The
Shares Being Offered Has Low Voting Power."
- 14 -
<PAGE>
The holders of Class A Common Stock are entitled to vote as a
separate class on any proposal to amend the Charter to increase the authorized
number of shares of Class B Common Stock, unless the increased authorization
does not exceed the number of shares of Class B Common Stock which must be
issued in a proposed stock dividend with respect to Class B Common Stock and an
equivalent stock dividend of Class A Common Stock will be effected concurrently
with respect to Class A Common Stock.
In addition, Section 804 of the Business Corporation Law of
New York confers upon the holders of Class A Common Stock the right to vote as a
class on any amendment to the Company's Charter which would (i) exclude or limit
the shareholders' right to vote on any matter, except as such rights may be
limited by voting rights given to new shares then being authorized; (ii) change
Class A Common Stock by (a) reducing the par value, (b) changing the shares into
a different number of the same class or into a different or same number of
shares of a different class, or (c) fixing, changing or abolishing the
designation of Class A Common Stock or any series thereof or any of the relative
rights, preferences, and limitations of the shares; or (iii) subordinate their
rights by authorizing shares having preferences which would be in any respect
superior to their rights. Other provisions of the New York Business Corporation
Law would entitle holders of Class A Common Stock to vote as a separate class
for approval of any plan of merger, consolidation or exchange which would effect
any change in Class A Common Stock described in the preceding sentence.
On proposals on which holders of Class A Common Stock are
entitled to vote as a separate class, the proposal must be approved by a
majority of the Class A Common Stock votes cast at the meeting at which the
voting occurs. Consequently, holders of Class A Common Stock, by withholding
such approval, can defeat a proposal notwithstanding that holders of a majority
of Class B Common Stock vote in favor of the proposal.
Dividends and Other Distributions. Each share of Class A Common Stock
and Class B Common Stock is equal in respect to dividends and other
distributions in cash, stock or property except that (i) if declared, a dividend
or distribution in shares of the Company on Class A Common Stock will be paid
only in Class A Common Stock, and (ii) if declared, a dividend or distribution
in shares of the Company on Class B Common Stock will be paid only in Class B
Common Stock. The number of shares so paid as a dividend or distribution on each
share of Class A Common Stock and Class B Common Stock shall be equal, although
the class of the shares so paid shall differ depending upon whether the
recipient of the dividend is a holder of Class A Common Stock or Class B Common
Stock.
Mergers and Consolidations. In the event of a merger, consolidation, or
combination of the Company with another entity (whether or not the Company is
the surviving entity) or in the event of dissolution of the Company, the holders
of Class A Common Stock will be entitled to receive the same per share
consideration as the per share consideration, if any, received by holders of
Class B Common Stock in that transaction. However, any shares of common stock
that holders of Class A Common Stock become entitled to receive in the
transaction may have terms substantially similar to the Class A Common Stock
themselves. Thus, the surviving entity
- 15 -
<PAGE>
in any such transaction could have a dual-class capital structure like that of
the Company and could, upon consummation of the merger or consolidation, give
full voting shares to the holders of Class B Common Stock and one-twentieth
(1/20) voting shares to the holders of Class A Common Stock.
Class A Special Rights. The Company's Certificate of Incorporation
contains a two- pronged "Class A Special Rights" provision which ensures that
holders of Class A Common Stock will not be unfairly treated in the event that a
person attempts to gain control of the Company.
First, the Class A Special Rights seek to prevent a person who
has crossed a certain ownership threshold from gaining control of the Company by
acquiring Class B Common Stock without buying Class A Common Stock. If any
person acquires more than 15% of the outstanding Class B Common Stock after
August 5, 1995 (the "Threshold Date"), and does not acquire after the Threshold
Date a percentage of the Class A Common Stock outstanding at least equal to the
percentage of Class B Common Stock that the person acquired in excess of the 15%
threshold, such person will not be allowed to vote shares of Class B Common
Stock acquired in excess of the 15% threshold. For example, if a person acquires
20% of the outstanding Class B Common Stock after the Threshold Date but
acquires no Class A Common Stock, that person would be unable to vote the 5% of
the Class B Common Stock acquired in excess of the 15% threshold. With respect
to persons who owned Common Stock of the Company on or prior to the Threshold
Date, only shares of Class B Common Stock acquired after the Threshold Date will
be counted in determining whether that shareholder has exceeded the 15%
threshold for acquisitions of Class B Common Stock and only acquisitions of
Class A Common Stock after the Threshold Date will be counted in determining
whether that shareholder's Class A Common Stock acquisitions have been at least
equal to the acquisition of Class B Common Stock in excess of the 15% threshold.
The inability of the person to vote the excess Class B Common Stock will
continue until such time as a sufficient number of shares of Class A Common
Stock have been acquired by the person to satisfy the requirements of the Class
A Special Rights.
The second prong of the Class A Special Rights is an
"Equitable Price" requirement. It is intended to prevent a person seeking to
acquire control of the Company from paying a discounted price for the Class A
Common Stock required to be purchased by the acquiring person under the first
prong of the Class A Special Rights. These provisions provide that an Equitable
Price has been paid for shares of Class A Common Stock only when they have been
acquired at a price at least equal to the greater of (i) the highest per share
price paid by the acquiring person, in cash or in non-cash consideration, for
any Class B Common Stock acquired within the 60 day periods preceding and
following the acquisition of the Class A Common Stock or (ii) the highest
closing market sale price of Class B Common Stock during the 30 day periods
preceding and following the acquisition of the Class A Common Stock. The value
of any non-cash consideration will be determined by the Board of Directors of
the Company acting in good faith. The highest closing market sale price of a
share of Class B Common Stock will be the highest closing sale price reported by
NASDAQ National Market or on any such other securities exchange then
constituting the principal trading market for either
- 16 -
<PAGE>
class of the Common Stock. In the event that no quotations are available, the
highest closing market sale price will be the fair market value during the 30
day periods preceding and following the acquisition of a share of Class B Common
Stock as determined by the Board of Directors of the Company acting in good
faith. The Equitable Price Provision is intended to require a person seeking to
acquire control of the Company to buy the Class B Common Stock and the Class A
Common Stock at virtually the same time and the same price, as might occur in a
tender offer, to ensure that the acquiring person would be able to vote the
Class B Common Stock acquired in excess of the 15% threshold.
Under the Class A Special Rights, an acquisition of Class B
Common Stock is deemed to include any shares that an acquiring Person acquires
directly or indirectly, in one transaction or a series of transactions, or with
respect to which that person acts or agrees to act in concert with any other
person (an "Acquisition"). As used in the preceding sentence, "Person" includes
one or more persons and entities who act or agree to act in concert with respect
to the Acquisition or disposition of Class B Common Stock or with respect to
proposing or effecting a plan or proposal to (a) a merger, reorganization or
liquidation of the Company or a sale of a material amount of its assets, (b) a
change in the Company's Board of Directors or management, including any plan or
proposal to fill vacancies on the Board of Directors or change the number or
term of Directors, (c) a material change in the business or corporate structure
of the Company, or (d) any material change in the capitalization or dividend
policy of the Company. Unless there are affirmative attributes of concerted
action, however, "acting or agreeing to act in concert with any other Person"
does not include acts or agreements to act by Persons pursuant to their official
capacities as directors or officers of the Company or because they are related
by blood or marriage.
For purposes of calculating the 15% threshold, the following
Acquisitions and increases are excluded: (i) shares of Class B Common Stock held
by any Person on the Threshold Date, (ii) an increase in a holder's percentage
ownership of Class B Common Stock resulting solely from a change in the total
number of shares of Class B Common Stock outstanding as a result of a repurchase
of Class B Common Stock by the Company since the last date on which that holder
acquired Class B Common Stock, (iii) Acquisitions of Class B Common Stock (a)
made pursuant to contracts existing prior to the Threshold Date, including the
Acquisition of Class B Common Stock pursuant to the conversion provisions of
the Preferred Stock outstanding prior to the Threshold Date, (b) by bequest
or inheritance or by operation of law upon the death or incompetency of any
individual, and (c) by any other transfer made without valuable consideration,
in good faith and not for the purpose of circumventing the Class A Special
Rights. A gift made to any Person who is related to the donor by blood or
marriage, a gift made to a charitable organization qualified under Section
501(c)(3) of the Internal Revenue Code of 1986 or a successor provision and a
gift to a Person who is a fiduciary solely for the benefit of, or which is owned
entirely by, one or more persons or entities (a) who are related to the donor by
blood or marriage or (b) which is a tax-qualified charitable organization or (c)
both will be presumed to be made in good faith and not for purposes of
circumventing the restrictions imposed by the Class A Special Rights.
- 17 -
<PAGE>
The Class A Special Rights also provide that, to the extent
that the voting power of any share of Class B Common Stock cannot be exercised
pursuant to the provision, that share will be excluded from the determination of
the total shares eligible to vote for any purpose for which a vote of
shareholders is taken.
Convertibility. The Class B Common Stock is convertible into Class A
Common Stock at any time on a share-for-share basis. The Class A Common Stock is
not convertible into shares of Class B Common Stock unless the number of
outstanding shares of Class B Common Stock falls below 5% of the aggregate
number of outstanding shares of Class B Common Stock and Class A Common Stock.
In that event, immediately upon the occurrence thereof, all of the outstanding
Class A Common Stock is converted automatically into Class B Common Stock on a
share-for-share basis and Class B Common Stock will no longer be convertible
into Class A Common Stock. For purposes of this provision, Class B Common Stock
or Class A Common Stock repurchased by the Company and not reissued is not
considered to be "outstanding" from and after the date of repurchase.
In the event of any such conversion of the Class A Common
Stock, certificates which formerly represented outstanding shares of Class A
Common Stock thereafter will be deemed to represent a like number of shares of
Class B Common Stock, and all common stock then authorized will be deemed to be
Class B Common Stock.
Preemptive Rights. Neither the Class A Common Stock nor the Class B
Common Stock carry any preemptive rights enabling a holder to subscribe for or
receive shares of the Company of any class or any other securities convertible
into any class of the Company's shares.
Transferability; Trading Market. The Class A Common Stock and the Class
B Common Stock are freely transferable and are listed for trading on the NASDAQ
National Market.
Description of Preferred Stock
None of the Company's Preferred Stock will be issued in the Offering.
No dividends or other distributions are payable on the Company's Common Stock
unless such dividends or distributions are first paid on the Preferred Stock. In
the event of a liquidation or dissolution of the Company, the outstanding shares
of Preferred Stock would have priority over the Common Stock in the distribution
of the remaining assets of the Company. The 10% Series A Preferred Stock is
convertible into shares of Common Stock on the basis of one share of Class A
Common Stock and one share of Class B Common Stock for every 20 shares of 10%
Series A Preferred Stock. The 10% Series B Preferred Stock is convertible into
Common Stock on the basis of one share of Class A Common Stock and one share of
Class B Common Stock for every 30 shares of 10% Series B Preferred Stock.
- 18 -
<PAGE>
Restrictions on Acquisition of the Company--Certain Charter and Bylaw Provisions
In addition to the restrictions imposed by the "Class A Special Rights"
provisions, the Company's Certificate of Incorporation contains two
super-majority voting provisions. Paragraph 5 of the Company's Certificate of
Incorporation provides that the affirmative vote of two-thirds of the shares
present and entitled to vote at the meeting is necessary to amend the Bylaws of
the Company. Paragraph 6 provides that a director may be removed regardless of
cause only upon the affirmative vote of two-thirds of the shares entitled to
vote for the election of that director. Both of these provisions reduce the
possibility of the shareholders receiving and accepting hostile takeover bids,
mergers, proxy contests, removal of current management, removal of directors or
other changes in control.
The Bylaws of the Company require the affirmative vote of two-thirds of
the shares present and entitled to vote to (i) effectuate an amendment to the
Bylaws of the Company and (ii) remove a director of the Company.
The Bylaws provide for the staggered voting of directors for three-year
terms so that shareholders desiring to replace the incumbent directors and gain
control of the Board would be required to win at least two successive annual
contests before their nominees constituted a majority of directors. See "Risk
Factors -- Certain Anti-Takeover Provisions."
Agreements Restricting Change in Control of the Company
The Alliance Agreement and certain significant agreements between the
Company and its lenders provide for penalties in the event of a change of
control of the Company as defined in the respective agreements.
LEGAL MATTERS
Jaeckle Fleischmann & Mugel, LLP, Buffalo, New York will pass upon
certain legal matters with respect to the shares offered hereby for the Company.
- 19 -
<PAGE>
EXPERTS
The consolidated financial statements and the related consolidated
financial statement schedule incorporated in this Prospectus by reference from
the Company's Annual Report on Form 10-K for the year ended March 31, 1996 have
been audited by Deloitte & Touche LLP, independent auditors, as stated in their
reports, which are incorporated herein by reference, and have been so
incorporated in reliance upon the reports of such firm given upon their
authority as experts in accounting and auditing. The reports of Deloitte &
Touche LLP refer to a change in the Company's method of accounting for
inventories and to a change in accounting for income taxes to conform with
Statement of Financial Accounting Standards No. 109.
- 20 -
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following is a list of the expenses the Registrant expects to pay
in connection with the issuance and distribution of the shares registered
hereby. The Company will be responsible for the payment of these expenses;
provided, however, that Pillsbury will be responsible for costs of printing to
the extent such costs exceed $2,500.
Filing and Registration Fees............................... $ 1,798.49
Legal Fees and Expenses*................................... $15,000.00
Cost of Printing*.......................................... $ 1,000.00
Accounting Fees and Expenses*.............................. $ 0.00
Miscellaneous Expenses*......................................$ 2,201.51
Total...................................................$20,000.00
----------------
* Estimated
Item 15. Indemnification of Directors and Officers.
The Company's Certificate of Incorporation provides that the Company is
required to indemnify each and every officer or director of the Company, even
those whose term has expired, for any and all expenses actually and necessarily
incurred by such director or officer in connection with the defense of any
action, suit or proceeding in which he is made a party by reason of being or
having been a director or officer of the Company. The Company is not required to
indemnify a director or officer for matters as to which such officer or director
is adjudged to be liable for neglect or misconduct in the performance of his
duties as director or officer. Further, the rights of the officers or directors
to indemnification are not exclusive of any other rights to which an officer or
director of the Company is entitled.
Under the Company's Bylaws, the Company has the authority to indemnify
its directors and officers to the fullest extent permitted by the New York
Business Corporation Law (sections 721-726) (the "BCL"). The Bylaws, reflecting
New York law, extend such protection to any person made or threatened to be made
a party to any action or proceeding, including an action by or in the right of
any other corporation, partnership, joint venture, trust, employee benefit plan
or other enterprise, which any director, officer or employee of the Company
served in any capacity at the request of the Company, by reason of the fact that
such director or officer, his testator
II-1
<PAGE>
or intestate, is or was a director or officer of the Company or is or was
serving such enterprise at the request of the Company. The Bylaws provide that
such indemnification may be authorized pursuant to the terms and conditions of
(i) a resolution of shareholders; (ii) a resolution of the Board of Directors;
(iii) an agreement providing for such indemnification or (iv) any judicial or
other legal authority which entitles the director, officer or employee to such
indemnification.
The BCL provides that, if successful on the merits or otherwise, an
officer or director is entitled to indemnification by the Company against
amounts paid in settlement and reasonable expenses, including attorneys' fees,
actually and necessarily incurred in connection with the defense of such action
or proceeding, or any appeal therein, if such director or officer acted in good
faith, for a purpose which he reasonably believed to be in, or at least not
opposed to, the best interests of the Company. The termination of any action or
proceeding by judgment, settlement, conviction or plea of nolo contendere, or
its equivalent, does not itself create the presumption that such director or
officer did not act, in good faith, for a purpose which he reasonably believed
to be in, or not opposed to, the best interests of the Company or that he had
reasonable cause to believe that his conduct was unlawful.
If a corporation fails to provide indemnification to its directors or
officers, the BCL provides that despite any contrary resolution of the board of
directors or shareholders, indemnification may be awarded by application to the
appropriate judicial authority. Application for such court-ordered
indemnification may be made either in the civil action or proceeding in which
the expenses were incurred or other amounts were paid or to the supreme court in
a separate proceeding.
II-2
<PAGE>
Item 16. Exhibits.
Exhibit
Number Description
3(i) The Company's Restated Certificate of Incorporation, as
amended (Incorporated by reference to Exhibit 3.1 to the
Company's 10-Q/A filed August 1995 for the quarter ended July
1, 1995)
3(ii) The Company's Bylaws, as amended (Incorporated by reference to
Exhibit 3.3 to the Company's 10-Q/A filed August 1995 for the
quarter ended July 1, 1995)
4(i) Note Agreement related to the $75,000,000 note with The
Prudential Insurance Company of America (Incorporated by
reference to Exhibit 99 to the Company's 10-Q for the quarter
ended January 28, 1995)
4(ii) Note Agreement related to the $50,000 note with John Hancock
Mutual Life Insurance Company (Incorporated by reference to
Exhibit 99 to the Company's 10-Q for the quarter ended January
28, 1995)
5 Opinion of Jaeckle Fleischmann & Mugel, LLP (filed herewith)
10(i) Asset Purchase Agreement related to the transaction with the
Green Giant(R) Division of Pillsbury (Incorporated by
reference to Exhibit 2(A) to the Company's statement on Form
8-K dated February 24, 1995)
10(ii) Alliance Agreement related to the transaction with the Green
Giant(R)Division of Pillsbury (Incorporated by reference to
Exhibit 2(B) to the Company's statement on Form 8-K dated
February 24, 1995)
10(iii) Secured Nonrecourse Subordinated Promissory Note related to
the transaction with the Green Giant(R) Division of Pillsbury
(Incorporated by reference to Exhibit 2(C) to the Company's
statement on Form 8-K dated February 24, 1995)
23(i) Consent of Deloitte & Touche LLP (filed herewith)
23(ii) Consent of Jaeckle Fleischmann & Mugel, LLP (contained in
Exhibit 5 above)
24 Power of Attorney (filed herewith at page II-6)
II-3
<PAGE>
Item 17. Undertakings.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the
Securities Act, the information omitted from the form of prospectus
filed as part of this registration statement in reliance upon Rule 430A
and contained in a form of prospectus filed by the registrant pursuant
to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be
deemed to be part of this registration statement as of the time it was
declared effective.
(2) For the purpose of determining any liability under the
Securities Act, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(3) For purposes of determining any liability under the
Securities Act, each filing of the registrant's annual report pursuant
to Section 13(a) or Section 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Exchange Act) that is incorporated by
reference in the registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(4) Insofar as indemnification for liabilities arising under
the Securities Act may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in the
opinion of the Commission such indemnification is against public policy
as expressed in the Securities Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or paid
by a director, officer, or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion
of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question of whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such
issue.
(5) It will (i) file, during any period in which offers or
sales are being made, a post-effective amendment to this registration
statement; (ii) include any prospectus required by Section 10(a)(3) of
the Securities Act; (iii) reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or the
most recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information set
forth in the registration statement; and (iv) include any material
information with respect to the plan of distribution not previously
II-4
<PAGE>
disclosed in the registration statement or any material change to such
information in the registration statement.
(6) For purposes of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered
therein; and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(7) It will remove from registration by means of a
post-effective amendment any of the securities being registered which
remain unsold at the termination of the offering.
II-5
<PAGE>
SIGNATURES AND POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized in Pittsford, New York, on May 23, 1997.
SENECA FOODS CORPORATION
By: /s/ Kraig H. Kayser
Kraig H. Kayser, President
and Chief Executive Officer
Each person whose signature appears below constitutes and appoints
Kraig H. Kayser and Arthur S. Wolcott, and each of them, his or her true and
lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for him or her and in his or her name, place and stead, in any
and all capacities, to sign any and all amendments to this Registration
Statement, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Commission, granting unto said
attorneys-in-fact and agents full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or their substitute or substitutes, may lawfully do or cause to be done
by virtue hereof.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed below by the following persons in the capacities and
on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/s/ Arthur S. Wolcott Chairman and Director May 11, 1997
Arthur S. Wolcott
/s/ Kraig H. Kayser President, Chief Executive May 12, 1997
Kraig H. Kayser Officer and Director
/s/ Philip G. Paras Vice President-Finance May 9, 1997
Philip G. Paras
II-6
<PAGE>
Signature Title Date
/s/ Jeffrey L. Van Riper Controller and Secretary May 12, 1997
Jeffrey L. Van Riper (Principal Accounting Officer)
/s/Robert T. Brady Director May 14, 1997
Robert T. Brady
/s/ David L. Call Director May 13, 1997
David L. Call
Director ______________, 1997
Edward O. Gaylord
/s/ G. Brymer Humphreys Director May 13, 1997
G. Brymer Humphreys
Director ______________, 1997
Susan W. Stuart
</TABLE>
223866
II-7
<PAGE>
Jaeckle Fleischmann & Mugel, LLP EXHIBIT 5
A T T O R N E Y S A T L A W
FLEET BANK BUILDING TWELVE FOUNTAIN PLAZA BUFFALO, NEW YORK
14202-2292 USA
TEL (716) 856-0600 FAX (716) 856-0432
May 23, 1997
Seneca Foods Corporation
1162 Pittsford-Victor Road
Pittsford, New York 14534
Ladies and Gentlemen:
Re: Registration Statement on Form S-3 under the
Securities Act of 1933, covering the registration of shares of Class
A Common Stock, $0.25 par value per share (the "Securities") of
Seneca Foods Corporation ("Seneca")
As your counsel we have examined the above Registration Statement and we
are familiar with the documents referred to therein, as well as Seneca's
Certificate of Incorporation, as amended and restated, and Bylaws, such records
of proceedings of Seneca as we deemed material, and such other proceedings of
Seneca as we deemed necessary for the purpose of this opinion.
We have examined the proceedings heretofore taken and we are informed as to
the procedures proposed to be followed by Seneca in connection with the
authorization, issuance and sale of the above described Securities. In our
opinion the Securities have been duly authorized for issuance by all necessary
corporate action and are legally issued, fully paid and non-assessable.
We consent to the filing of this opinion letter as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Jaeckle Fleischmann & Mugel, LLP
261615
EXHIBIT 23(i)
EXHIBIT 23(i)
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement
of Seneca Foods Corporation and subsidiaries on Form S-3 of our reports dated
May 31, 1996 (which express an unqualified opinion and refer to a change in the
Company's method of accounting for inventories and to a change in accounting for
income taxes to conform with Statement of Financial Accounting Standards No.
109), appearing in and incorporated by reference in the Annual Report on Form
10-K of Seneca Foods Corporation and subsidiaries for the year ended March 31,
1996 and to the reference to us under the heading "Experts" in the Prospectus,
which is part of this Registration Statement.
Deloitte & Touche LLP
Rochester, New York
May 22, 1997
261700
