-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, F1/advCs+Gso6CrOyIEpG5j7maNQLPiIxTIqNtIte8FQJbNq8tadko2/Dw6I2rBZ x8RuLjEIaQDKuKEwFLKW3A== 0000819527-98-000001.txt : 19980129 0000819527-98-000001.hdr.sgml : 19980129 ACCESSION NUMBER: 0000819527-98-000001 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19971231 FILED AS OF DATE: 19980128 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: GALAXY FOODS CO CENTRAL INDEX KEY: 0000819527 STANDARD INDUSTRIAL CLASSIFICATION: DAIRY PRODUCTS [2020] IRS NUMBER: 251391475 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-16251 FILM NUMBER: 98515270 BUSINESS ADDRESS: STREET 1: 2441 VISCOUNT ROW CITY: ORLANDO STATE: FL ZIP: 32809 BUSINESS PHONE: 4078555500 MAIL ADDRESS: STREET 1: 2441 VISCOUNT ROW CITY: ORLANDO STATE: FL ZIP: 32809 FORMER COMPANY: FORMER CONFORMED NAME: GALAXY CHEESE CO DATE OF NAME CHANGE: 19920302 10QSB 1 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. 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 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. 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. 5 GALAXY FOODS COMPANY CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY
Common Stock Preferred Stock Additional Notes Rec & Par Par Paid-In Accumulated Subs. for Shares Value Shares Value Capital Deficit Common Stock Total 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
* 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. 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 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. 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. 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 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. 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. 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. 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 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 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 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 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) EX-27 2 FINANCIAL DATA SCHEDULE
5 3-MOS MAR-31-1998 DEC-31-1997 19,378 0 2,470,375 0 2,387,785 410,435 12,539,898 2,055,285 15,871,150 5,222,044 0 616,191 0 0 35,563,676 15,871,150 4,568,397 4,570,985 3,238,034 1,109,039 0 0 25,297 198,615 0 198,615 0 0 0 198,615 .00 .00
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