Pacific Grove Spice Company

Exhibit 1 - Income Statement ($ in millions except for price per share)

Income Statement 06/30/07 06/30/08 06/30/09 06/30/10 06/30/11 06/30/12

Net Sales $46.180 $53.107 $57.887 $68.017 $80.940 $93.081

Cost of Goods Sold 26.784 30.802 33.575 39.790 47.512 54.452
Gross Profit Margin 19.396 22.305 24.312 28.227 33.428 38.629

R&D Expense 0.739 0.850 0.926 1.088 1.295 1.489

SG&A Expense 14.916 17.260 18.871 21.902 26.063 29.321
Earnings Before Interest & Taxes 3.741 4.195 4.515 5.237 6.070 7.819

Interest Expense 2.906 2.940 2.668 2.423 2.817 3.237

Earnings Before Income Taxes 0.835 1.255 1.847 2.814 3.253 4.581

Income Taxes 0.225 0.339 0.499 0.760 0.879 1.237

Net Income 0.610 0.916 1.348 2.054 2.374 3.344

Growth rate of sale 15.00% 9.00% 17.50% 19.00% 15.00%

Income tax rate assumed 27.00%
Price/Earnings Ratio 16.0
Market Value of Equity $37.990

Common Shares Outstanding 1,165,327

Price per share $32.60

Note: 2012-2015 are projected data

06/30/13 06/30/14 06/30/15

$105.182 $116.751 $127.259

61.531 68.300 74.447
43.650 48.452 52.813

1.683 1.868 2.036

33.132 36.777 40.087
8.835 9.807 10.690

3.582 3.894 4.124

5.254 5.913 6.566

1.418 1.597 1.773

3.835 4.316 4.793 37.984

13.00% 11.00% 9.00%

27.00% 27.00% 27.00%
Pacific Grove Spice Company

Exhibit 2 - Balance Sheet ($ in millions)

proyecta
Assets 06/30/07 06/30/08 06/30/09 06/30/10 06/30/11 06/30/12

Cash $2.325 $2.680 $2.924 $3.440 $4.102 $4.672

Accounts Receivable 9.489 10.912 11.895 13.976 16.632 19.126
Inventories 6.697 7.701 8.394 9.947 11.878 13.613
Prepaid Expenses 0.770 0.840 0.910 0.828 0.969 1.117
Total Current Assets 19.281 22.133 24.123 28.191 33.581 38.528

Net Property & Equipment * 15.200 16.000 17.300 19.100 22.400 25.157
Other Long-Term Assets 2.241 2.479 2.671 3.074 3.639 4.189
Total Assets 36.722 40.612 44.094 50.365 59.620 67.874

Growth rate of assets 10.6% 8.6% 14.2% 18.4% 13.8%

Liabilities & Owners' Equity 06/30/07 06/30/08 06/30/09 06/30/10 06/30/11 06/30/12

Bank Notes Payable $7.669 $8.820 $9.613 $11.295 $13.442 $15.492

Accounts Payable 2.203 2.532 2.760 3.271 3.905 4.476
Current Portion of Long-Term Debt 0.973 1.060 1.124 1.240 1.483 1.614
Accrued Expenses 0.771 0.884 0.965 1.129 1.345 1.545
Total Current Liabilities 11.616 13.296 14.462 16.935 20.175 23.127

Long-Term Debt 14.600 15.894 16.862 18.606 22.247 24.204

Total Liabilities 26.216 29.190 31.324 35.541 42.422 47.331

Common Stock 6.881 6.881 6.881 6.881 6.881 6.881

Retained Earnings 3.625 4.541 5.889 7.943 10.317 13.661
Total Shareholder Equity 10.506 11.422 12.770 14.824 17.198 20.543

Total Liabilities & Net Worth 36.722 40.612 44.094 50.365 59.620 67.874

* Net property & equipment for all years is calculated as net property & equipment from the prior year, plus capital expenditures in the same ye
depreciation expense in the same year. Depreciation expense is included in reported operating expenses; it is not broken out separately.

Note: 2012-2015 are projected data

 proyectado
06/30/13 06/30/14 06/30/15
LEYEND
AS
$5.279 $5.860 $6.387 DEUDA TOTAL DE LA EMPRESA US$ 37,172 EQUIVALE AL 62%
DE LOS ACTIVOS Y 216 DEL PATRIMONIO NETO
21.613 23.990 26.149
15.383 17.075 18.612 MULTIPLICADOR DEL CAPITAL 3.466621701
1.262 1.401 1.527
43.537 48.326 52.675

28.427 31.554 34.395

4.733 5.254 5.727
76.697 85.134 92.797

13.0% 11.0% 9.0%

06/30/13 06/30/14 06/30/15

$17.506 $19.432 $21.181

5.057 5.614 6.119
1.751 1.842 1.869
1.746 1.938 2.113
26.061 28.826 31.282

26.258 27.614 28.028

52.319 56.440 59.310

6.881 6.881 6.881

17.497 21.813 26.606
24.378 28.694 33.488

76.697 85.134 92.797

al expenditures in the same year, minus

not broken out separately.
Pacific Grove Spice Company

Exhibit 3 - Capital Budgeting Analysis of Television Program Opportunity

Initial Investment Cash Flows Year 0

Equipment -$1,440,000

Growth Rate of Sales 5.0% 5.0%

Operating Cash Flows Year 1 Year 2 Year 3

Sales $8,100,000 $8,505,000 $8,930,250

Cost of Goods Sold at 58.5% of sales 4,738,500 4,975,425 5,224,196
Gross Profit Margin 3,361,500 3,529,575 3,706,054

Promotion Expense at 11% of sales 891,000 935,550 982,328

General & Administrative Expense 760,000 798,000 837,900
Depreciation Expense 288,000 288,000 288,000
Incremental Operating Profit 1,422,500 1,508,025 1,597,826

Income Taxes at 27% 384,075 407,167 431,413

Incremental Net Income 1,038,425 1,100,858 1,166,413

+ Depreciation Expense 288,000 288,000 288,000

Incremental Operating Cash Flow 1,326,425 1,388,858 1,454,413

Yearly Net Working Capital Investment Year 1 Year 2 Year 3

Additional A/R at 75 Days Sales Outstanding $1,664,384 $83,219 $87,380
Additional Inventory at 4 Inventory Turns 1,184,625 59,231 62,193
Additional A/P at 30 Days COGS 389,466 19,473 20,447
Total NWC Investment -2,459,543 -122,977 -129,126

Terminal Cash Flows Year 1 Year 2 Year 3

Recovery of NWC

Total Project Cash Flows -$1,440,000 -$1,133,118 $1,265,881 $1,325,287

Internal Rate of Return 41.28%

Net Present Value at 20% $1,716,414

Net Present Value at 15% $2,405,498
Net Present Value at 10% $3,278,174
 5.0% 5.0%
Year 4 Year 5

$9,376,763 $9,845,601
5,485,406 5,759,676
3,891,356 4,085,924

1,031,444 1,083,016
879,795 923,785
288,000 288,000
1,692,118 1,791,123

456,872 483,603
1,235,246 1,307,520

288,000 288,000
1,523,246 1,595,520

Year 4 Year 5
$91,749 $96,337
65,302 68,568
21,469 22,543
-135,582 -142,361

Year 4 Year 5
$2,989,590

$1,387,664 $4,442,748
Pacific Grove Spice Company

Exhibit 4 - High Country Seasonings Income Statement ($ in millions)

Income Statement 06/30/08 06/30/09 06/30/10 06/30/11

Net Sales $15.401 $15.919 $16.664 $17.564

Cost of Goods Sold 9.887 10.284 10.732 11.329
Gross Profit Margin 5.514 5.635 5.932 6.235

R&D Expense 0.000 0.000 0.000 0.000

SG&A Expense 4.359 4.553 4.816 5.041
Earnings Before Interest & Taxes 1.155 1.082 1.116 1.194

Interest Expense 0.057 0.072 0.060 0.063

Earnings Before Income Taxes 1.098 1.010 1.056 1.131

Income Taxes 0.297 0.273 0.285 0.306

Net Income 0.801 0.737 0.771 0.825

Dividends Paid 0.288 0.254 0.422 0.401

Pacific Grove Spice Company

Exhibit 5 - High Country Seasonings Balance Sheet ($ in millions)

Assets 06/30/08 06/30/09 06/30/10 06/30/11

Cash $0.585 $0.610 $0.639 $0.673

Accounts Receivable 3.165 3.271 3.424 3.609
Inventories 2.060 2.142 2.236 2.360
Prepaid Expenses 0.231 0.239 0.250 0.263
Total Current Assets 6.041 6.262 6.549 6.905

Net Property & Equipment * 3.831 4.146 4.273 4.424

Other Long-Term Assets 0.462 0.477 0.500 0.527
Total Assets 10.334 10.885 11.322 11.856

Liabilities + Owners' Equity 06/30/08 06/30/09 06/30/10 06/30/11

Bank Notes Payable $0.791 $0.818 $0.856 $0.902

Accounts Payable 0.813 0.845 0.882 0.931
Current Portion of Long-Term Debt 0.000 0.000 0.000 0.000
Accrued Expenses 0.262 0.271 0.283 0.299
Total Current Liabilities 1.866 1.934 2.021 2.132

Long-Term Debt 0.000 0.000 0.000 0.000

Total Liabilities 1.866 1.934 2.021 2.132

Common Stock 4.584 4.584 4.584 4.584

Retained Earnings 3.884 4.367 4.716 5.140
Total Shareholder Equity 8.468 8.951 9.300 9.724

Total Liabilities & Net Worth 10.334 10.885 11.322 11.856

* Net property & equipment for all years is calculated as net property & equipment from the
prior year, plus capital expenditures in the same year, minus depreciation expense in the
same year. Depreciation expense is included in reported operating expenses; it is not
broken out separetely.
Pacific Grove Spice Company

Exhibit 6 - Industry Information

McCormick & Company* ConAgra Foods**

2010 2011 2010 2011

Sales revenue (in millions) $3,336.8 $3,440.5 $12,014.9 $12,303.1

Net income (in millions) $370.2 $386.5 $725.8 $817.0
Earnings per share $2.79 $2.92 $1.63 $1.90
Closing stock price $44.01 $49.60 $24.02 $25.76
Price/earnings ratio 15.8 17.0 14.7 13.6

Total liabilities (in millions) $1,957.0 $1,947.3 $6,809.1 $6,700.2

Interest-bearing debt (in millions) $880.3 $989.7 $3,487.2 $3,233.8

Book value of equity (in millions) $1,462.7 $1,642.1 $4,928.9 $4,708.5

Shares outstanding (in millions) 133.1 132.4 443.6 429.7

Market value of equity (in millions) $5,857.7 $6,567.0 $10,655.3 $11,069.1

Equity beta coefficient 0.50 0.60

* McCormick's fiscal year-end is November 30. The 2011 data presents the most recent four quarters of
income statement information and the May 31, 2011, balance sheet information.

** ConAgra's fiscal year-end is May 31. The 2011 data presents the full 2011 fiscal year.

Current market interest rates in July of 2011:

Long-term U.S. Treasury Bonds 4.25%

Long-term AA Corporate Bonds 5.20%

Long-Term BBB Corporate Bonds 5.65%

Market Risk Premium, S&P 500 vs. Long-term Treasuries 7.00%

Prime Interest Rate 3.25%

Pacific Grove Spice Co.
2010 2011

$68.0 $80.9
$2.1 $2.4
$1.76 $2.04
$25.87 $32.60
14.7 16.0

$35.5 $42.4
$31.1 $37.2

$14.8 $17.2

1.2 1.2
$30.1 $38.0

0.85
 2012.000 2013.000 2014.000 2015.000
Crecimiento de ventas 7.0% 6.0% 5.0% 4.8%
Net Sales 2011 17.564

Año 2012.000 2013.000 2014.000 2015.000

Costo de los bienes vendidos 62% 59% 59% 59%

Investigación y desarrollo 1% 2% 2% 2%
Ventas, generales y administrativos 30% 32% 32% 32%
Efectivo 20 días de gastos operativos
Periodo promedio de cuentas por cobrar 75 días
Rotación de inventarios 4
Rotación de propiedad planta y equipo ne 4
Gastos pre-pagados 1.20% de las ventas
Otros activos de largo plazo 4.50% de las ventas
Periodo promedio de cuentas por pagar 30 días
Gastos devengados 1.66% de las ventas

Tasa Impositiva 27%

Estructura de Capital
Monto Porcentaje
Deuda 0.902 8.5%
Patrimonio 9.724 91.5%
Capital Invertido 10.626 100.0%

McCormick ConAgra Pacific Grove

& Company* Foods** Spice Co.

Beta apalancado 0.50 0.60 0.85

Interest-bearing debt (in millions) 989.7 3233.8 37.172
Market value of equity (in millions) 6567.04 11069.072 37.979
Beta no apalancado 0.4504 0.4643 0.4296
Beta no apalancado promedio 0.4481

Equity beta coefficient de High Country 0.48

Long-term U.S. Treasury Bonds 4.25%

Market Risk Premium, S&P 500 vs. Long-te 7%

Costo de las acciones 7.6%
Costo de deuda antes de impuestos 7.25%
Impuesto a la renta 27%
WACC 7.403%
Crecimiento de largo plazo 3.5%
 2012 2013 2014 2015
Ingreso por ventas 18.793 19.921 20.917 21.921
Costos de ventas -11.558 -11.654 -12.237 -12.824
Utilidad Bruta 7.235 8.267 8.681 9.097
Investigación y desarrollo -0.19 -0.32 -0.33 -0.35
Ventas, generales y
administrativos
-5.66 -6.28 -6.59 -6.91
Utilidad Operativa 1.39 1.67 1.76 1.84
Impuestos -0.38 -0.45 -0.47 -0.50
Flujo Efectivo Operativo 1.02 1.22 1.28 1.34
Cápex -0.59 -0.33 -0.29 -0.30
Inversión en capital de trabajo -0.99 -0.29 -0.35 -0.35
Perpetuidad 18.49
Flujo de caja libre -0.57 0.60 0.64 19.19
Valor de la empresa 14.926

Flujo de caja libre -0.57 0.60 0.64 0.70

Variación de flujo caja libre 6.82% 8.80%

Caja 0.95 1.00 1.05 1.10

cuentas por cobrar 3.86 4.09 4.30 4.50
Inventarios 2.89 2.91 3.06 3.21
propiedad y equipo neto 4.70 4.98 5.23 5.48
Gastos pre-pagados 0.23 0.24 0.25 0.26
cuentas por pagar 0.95 0.96 1.01 1.05

Gastos devengados 0.31 0.33 0.35 0.36

Otros activos de largo plazo 0.85 0.90 0.94 0.99
Capital de trabajo neto 6.67 6.96 7.31 7.66
propiedad y equipo neto y otros act 5.54 5.88 6.17 6.47

Capital de trabajo neto 2011 5.68

propiedad y equipo neto y otros 4.951
activos LP 2011
 06/30/12 06/30/13 06/30/14 06/30/15
Net Sales 120.0 133.6 146.6 158.6
Cost of Goods Sold -70.7 -78.2 -85.8 -92.8
Gross Profit Margin 49.2 55.4 60.8 65.8

Promotion Expense at 11% of sales -0.89 -0.94 -0.98 -1.03

R&D Expense -1.68 -2.00 -2.20 -2.39
SG&A Expense -35.74 -40.21 -44.20 -47.87
Earnings Before Interest & Taxes 10.9 12.3 13.4 14.5

Interest Expense -3.437 -3.682 -3.994 -4.224

Earnings Before Income Taxes 7.48 8.62 9.46 10.29

Income Taxes -2.02 -2.33 -2.55 -2.78

Net Income 5.46 6.29 6.90 7.51

Incremento en los intereses de las CIAS combinadas 0.2 0.1 0.1 0.1

06/30/12 06/30/13 06/30/14 06/30/15

Cash 5.63 6.28 6.91 7.49
Accounts Receivable 23.08 25.80 28.38 30.65
Inventories 17.69 18.36 20.20 21.88
Prepaid Expenses 1.34 1.50 1.65 1.79
Total Current Assets 47.73 51.93 57.14 61.81

Net Property & Equipment * 29.9 33.4 36.8 39.9

Other Long-Term Assets 5.03 5.63 6.20 6.71
Total Assets 82.62 90.97 100.12 108.40

Bank Notes Payable 16.39 18.41 20.33 22.08

Accounts Payable 5.81 6.03 6.64 7.19
Current Portion of Long-Term Debt 1.614 1.751 1.842 1.869
Accrued Expenses 1.857 2.077 2.285 2.476
Total Current Liabilities 25.68 28.27 31.10 33.62

Long-Term Debt 24.204 26.258 27.614 28.028

Total Liabilities 49.88 54.53 58.71 61.65
Common Stock 10.95 10.95 10.95 10.95
Retained Earnings 21.78 25.49 30.45 35.80
Total Shareholder Equity 32.74 36.44 41.41 46.75

Total Liabilities & Net Worth 82.62 90.97 100.12 108.40

número de acciones emitidas 0.4 millones

precio de la acción 27.5
Ingreso por ventas de las acciones emitidas 11

Patrimonio de Pacific antes de la adquisición de 17.198

Country y con el programa de tv
Nuevo valor del patrimonio de Pacific 32.735
Nuevo valor del activo total de Pacific 82.620
Multiplicador de capital 2.524
Deuda Pacific Grover 41.311
Deuda de de High Country 0.902
Deuda Total 42.213
% de Deuda respecto al activo total 51.09%