Tyson Foods 2005 Annual Report Download - page 52

>> NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
TYSON FOODS, INC. 2005 ANNUAL REPORT
Tyson Foods, Inc. >> 50
assumed as part of the TFM acquisition. The Company received
formal approval during fiscal 2004 from The Joint Committee
on Taxation of the U.S. Congress for issues relating to certain
pre-acquisition years. As a result of this approval, the accrual of
$91 million of pre-acquisition tax liability was no longer needed.
The following table summarizes cash payments for interest and
income taxes:
in millions 2005 2004 2003
Interest $218 $316 $269
Income taxes, net of refunds 107 244 36
Cash payments for interest in fiscal 2005 decreased as compared
to fiscal 2004 primarily due to lower debt levels and the timing of
interest payments made related to the senior notes. The decrease
in income taxes paid from fiscal 2004 to fiscal 2005 is primarily due
to lower current taxable income as well as the benefit of some
overpayments carried over from fiscal 2004. The increase in income
taxes paid from fiscal 2003 to fiscal 2004 is primarily due to a
refund received in fiscal 2003.
TRANSACTIONS WITH RELATED PARTIES
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The Company has operating leases for farms, equipment and other
facilities with Don Tyson, a director of the Company, certain members
of his family and the Randal W. Tyson Testamentary Trust. Total
payments of $8 million in fiscal years 2005, 2004 and 2003 were
paid to entities in which these parties had an ownership interest.
Additionally, other facilities have been leased from other officers
and directors. Rentals paid to entities in which these parties had
an ownership interest totaled $1 million in fiscal years 2005 and
2004, and $2 million in fiscal 2003.
In the fourth quarter of fiscal 2005, the company purchased a
parcel of land adjacent to the Company’s Corporate Center for
approximately $600,000 from JHT, LLC, a limited liability company
of which Don Tyson, a director of the Company, and the Randal W.
Tyson Testamentary Trust, are members. The land is to be used for
expansion of corporate offices.
In the fourth quarter of fiscal 2005, the Company received approxi-
mately $4 million from entities owned by Don Tyson, a director
of the Company, and John Tyson, Chairman and CEO of the
Company, as payment for the purchase of certain properties
owned by the Company.
In the third quarter of fiscal 2004, the Company purchased a
parcel of land adjacent to the Company’s Corporate Center for
approximately $356,000 from JHT, LLC, a limited liability company
of which Don Tyson, a director of the Company, and the Randal W.
Tyson Testamentary Trust are members. The land is to be used for
expansion of corporate offices.
In the second quarter of fiscal 2004, the Company purchased
1,028,577 shares of Class A stock in a private transaction with
Don Tyson, a director and managing partner of the Tyson Limited
Partnership, a principal shareholder of the Company. The purchase
of those shares from Mr. Tyson, was based on the closing price
of the Class A stock on the New York Stock Exchange on the
date of purchase.
During fiscal 2004, the Company received cash payments from
Don Tyson, a director of the Company, totaling $1.5 million, as
reimbursement for certain perquisites and personal benefits
received during fiscal years 1997 through 2003.
Certain officers and directors were engaged in chicken and swine
growout operations with the Company whereby these individuals
purchased animals, feed, housing and other items to raise the
animals to market weight. The total value of these transactions,
which were discontinued during fiscal 2003, amounted to
$11 million in fiscal 2003.
A former director who resigned from the Board of Directors during
2003, received $10 million in fiscal 2003 from the sale of cattle to a
subsidiary of the Company.