Note G: Commitments and Contingencies

In order to ensure a steady supply of hogs and turkeys and to keep the cost of products stable, the company has entered into contracts with producers for the purchase of hogs and turkeys at formula- based prices over periods of up to 15 years. Under these contracts, the company is committed at October 28, 2000, to purchase hogs and turkeys, assuming current price levels, as follows:

(In Thousands)                                                

2001                                                $  869,388
2002                                                   761,953
2003                                                   728,979
2004                                                   716,274
2005                                                   415,937
Later years                                          1,365,648
Total                                               $4,858,179

Estimated purchases under these contracts for fiscal 2000, 1999 and 1998 were $815.9 million, $582.1 million and $514.4 million, respectively.

The company has noncancelable operating lease commitments on facilities and equipment at October 28, 2000, as follows:

(In Thousands)                                                

2001                                                   $ 6,914
2002                                                     7,628
2003                                                     6,883
2004                                                     5,649
2005                                                     5,109
Later years                                              8,217
Total                                                  $40,400

The company has commitments to expend approximately $64.1 million to complete construction in progress at various locations at October 28, 2000. The company has also pledged $28.9 million of securities as collateral guaranteeing loans at October 28, 2000.

The company is involved on an ongoing basis in litigation arising in the ordinary course of business. In the opinion of management, the outcome of litigation currently pending will not materially affect the company's results of operations, financial condition or liquidity.