<PAGE>   1
================================================================================
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
    OF 1934

                   FOR THE FISCAL YEAR ENDED DECEMBER 2, 1995

                                       OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

                          COMMISSION FILE NUMBER 1-1210
                               CULBRO CORPORATION
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

               NEW YORK                                    13-0762310
    (STATE OR OTHER JURISDICTION OF                    (I.R.S. EMPLOYER
     INCORPORATION OR ORGANIZATION)                    IDENTIFICATION NO.)
                                                  
387 PARK AVENUE SOUTH, NEW YORK, NEW YORK                  10016-8899
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)                   (ZIP CODE)

(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)     (212) 561-8700

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:


                                                       NAME OF EACH EXCHANGE
        TITLE OF EACH CLASS                            ON WHICH REGISTERED  

     COMMON STOCK, $1 PAR VALUE                    NEW YORK STOCK EXCHANGE, INC.

SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:

                          NONE

     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]

     INDICATE BY CHECK MARK IF DISCLOSURE OF DELINQUENT FILERS PURSUANT TO ITEM
405 OF REGULATION S-K IS NOT CONTAINED HEREIN, AND WILL NOT BE CONTAINED, TO THE
BEST OF REGISTRANT'S KNOWLEDGE, IN DEFINITIVE PROXY OR INFORMATION STATEMENTS
INCORPORATED BY REFERENCE IN PART III OF THIS FORM 10-K OR ANY AMENDMENT TO THIS
FORM 10-K. [X]

     STATE THE AGGREGATE MARKET VALUE OF THE VOTING STOCK HELD BY NON-AFFILIATES
OF THE REGISTRANT. THE AGGREGATE MARKET VALUE SHALL BE COMPUTED BY REFERENCE TO
THE PRICE AT WHICH THE STOCK WAS SOLD, OR THE AVERAGE BID AND ASKED PRICES OF
SUCH STOCK, AS OF A SPECIFIED DATE WITHIN 60 DAYS PRIOR TO THE DATE OF FILING:
$128,000,000 APPROXIMATELY, BASED ON THE CLOSING SALES PRICE ON THE NEW YORK
STOCK EXCHANGE ON FEBRUARY 20, 1996.

     INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE REGISTRANT'S
CLASSES OF COMMON STOCK, AS OF THE LATEST PRACTICABLE DATE: COMMON STOCK:
4,431,005 SHARES AS OF FEBRUARY 20, 1996.

     THE FOLLOWING DOCUMENTS, OR PORTIONS THEREOF AS INDICATED IN THE FOLLOWING
REPORT, ARE INCORPORATED BY REFERENCE IN THE PARTS OF FORM 10-K INDICATED: 


   PART                                    DOCUMENT
   ----                                    --------

     I ANNUAL REPORT TO SHAREHOLDERS FOR THE FISCAL YEAR ENDED DECEMBER 2, 1995

    II ANNUAL REPORT TO SHAREHOLDERS FOR THE FISCAL YEAR ENDED DECEMBER 2, 1995

   III PROXY STATEMENT IN CONNECTION WITH THE 1996 ANNUAL MEETING OF
       SHAREHOLDERS 

    IV ANNUAL REPORT TO SHAREHOLDERS FOR THE FISCAL YEAR ENDED
       DECEMBER 2, 1995 (SUCH ANNUAL REPORT IS REFERRED TO HEREINAFTER AS THE 
       "ANNUAL REPORT")

================================================================================


<PAGE>   2
FORM 10-K 1995                                               CULBRO  CORPORATION

                                     PART I

ITEM 1 - BUSINESS

         Culbro Corporation and its subsidiaries (the "Corporation") comprise a
diversified consumer and industrial products company. The Corporation engages in
four principal lines of business: (1) Consumer Products, comprised of the
manufacturing and marketing of cigars and the growing, processing and selling of
cigar wrapper tobacco; (2) Nursery Products, growing for sale container and
field grown nursery products principally to nursery mass merchandisers, and
owning and operating wholesale sales and service centers; (3) Industrial
Products, which consists of the manufacturing and marketing of packaging and
labeling systems which include plastic shrink film labels and tamper-evident
seals and the production of packaging and labeling machinery to apply them; and
(4) Real Estate, owning, building and managing commercial and industrial
properties and developing residential subdivisions on real estate owned by the
Corporation in Connecticut and Massachusetts, and owning and managing its
headquarters building at 387 Park Avenue South in New York City.

         The approximate net sales and other revenue, operating profit and
identifiable assets attributable to each reportable segment of the Corporation
in each of the last three fiscal periods are set forth in Note 2 to the
Consolidated Financial Statements.

         On February 1, 1996 the Corporation announced its intention to sell its
Industrial Products unit.

EQUITY INVESTMENTS

         On April 25, 1994, The Eli Witt Company ("Eli Witt") acquired the net
assets of the six Southern distribution facilities of NCC L.P. in exchange for
595,000 newly issued common shares of Eli Witt. The six facilities, designated
as NCC South, comprised a portion of the overall distribution business of NCC
L.P. Prior to this acquisition, the Corporation owned 85% of the outstanding
common stock of Eli Witt and the former shareholders of Certified Grocers of
Florida, Inc. ("Certified Grocers") held 15% which they received in connection
with Eli Witt's acquisition of Certified Grocers in 1993. In a transaction
executed simultaneously with Eli Witt's acquisition of the net assets of NCC
South, the Corporation sold 400,000 shares of its Eli Witt common stock to MS
Distribution, Inc. ("MSD"), a former limited partner of NCC and an affiliate of
the Morgan Stanley Leveraged Equity Fund II L.P., and issued a $15 million
subordinated note to MSD. The Corporation received proceeds of $12 million and
entered into an agreement with MSD to exchange, in 1998, the subordinated note
for the $15 million face value Eli Witt Series B Preferred Stock held by the
Corporation. As a result of these transactions, MSD owns shares totalling
approximately 38% of the outstanding common stock of Eli Witt.

         As a result of Eli Witt's issuance of additional common stock in
connection with the acquisition and the concurrent sale by the Corporation of
certain of its Eli Witt common stock holdings in the transaction, the
Corporation's ownership of Eli Witt's outstanding common stock was reduced from
85% to 50.1%. In connection with these transactions, the Corporation entered
into a Shareholders Agreement with MSD. This Agreement contains certain
governance provisions which require prior approval by MSD for substantially all
major transactions by Eli Witt, including (but not limited to) incurrence of
debt, acquisitions, material contracts, the sale of assets, stock issuance and
repurchase, changes in Eli Witt's charter and by-laws, and capital expenditures.
Due to the shareholder rights granted to MSD, the Corporation no longer has
unilateral control over Eli Witt. Therefore, the Corporation deconsolidated Eli
Witt as of April 25, 1994 and is accounting for its remaining investment in Eli
Witt under the equity method in its 1995 financial statements. See Notes 1 and 8
to the Consolidated Financial Statements.



                                      -2-
<PAGE>   3
FORM 10-K 1995                                               CULBRO  CORPORATION

         The Corporation owns approximately 25% of the stock of Centaur
Communications Limited, a privately-held publisher of business magazines in the
United Kingdom.

CONSUMER PRODUCTS

         The Consumer Products segment is comprised of the Cigar Business.

         CIGAR BUSINESS

         The cigar business is comprised principally of (a) the manufacture and
sale, by General Cigar Co., Inc. ("General Cigar"), of domestic and imported
cigars in all major price categories under numerous trademarks, including the
premium cigar brands of Macanudo, Partagas, Temple Hall, Ramon Allones, Cohiba
and Canaria D'Oro and the domestic cigar brands of Garcia y Vega, White Owl,
Tiparillo, Robt. Burns, Wm. Penn and Tijuana Smalls and (b) the growing,
processing and sale of cigar wrapper tobacco by the Culbro Tobacco Division of
General Cigar.

         Cigars are produced with three tobacco components: filler, binder and
wrapper. Filler tobacco is purchased from a large number of growers and
suppliers in many areas of the world. The binder is principally natural binder
leaf or a homogenized tobacco binder. General Cigar's premium brands and its
Garcia y Vega brand are wrapped with natural cigar wrapper tobacco. Its other
domestic cigars are primarily wrapped with homogenized tobacco wrappers. Some of
the natural leaf wrapper tobacco used for General Cigar's cigars is grown by
General Cigar on farms it leases from the Corporation in the Connecticut River
Valley. The remainder of General Cigar's requirements for natural leaf wrapper
tobacco is purchased from a number of foreign growers and suppliers. A portion
of the wrapper tobacco grown by General Cigar is sold to others, including
export sales principally in Europe. General Cigar annually adjusts acreage grown
to reflect changing market demands anticipated from export customers and for its
own use.

         General Cigar maintains inventories of wrapper and filler tobacco for
cigars sufficient to meet its estimated requirements for more than one year.
Most of its inventories are stored in warehouses in the United States and the
Dominican Republic. General Cigar believes that its inventories are adequately
insured.

         The markets for General Cigar's cigars are highly competitive. The
industry, through 1993, had experienced a long continuing decline in cigar
consumption and substantial consolidation. The most recent cigar statistics
reflect a significant reversal of this trend with unit sales turning positive in
1994 and accelerating in 1995. Dollar sales have increased as a result of price
increases and a substantial increase in the demand for all classifications of
cigars, including high priced premium, natural-leaf cigars, and homogenized
wrapper cigars. As a result of increasing demand, backorders for General Cigar
cigars increased substantially during 1995. General Cigar intends to increase
capital spending to provide additional facilities and equipment to increase
production capacity. In order to maintain its position in its markets, General
Cigar advertises and employs a variety of promotional activities. General Cigar
believes that it is among the industry leaders in the manufacture and sale of
cigars in the United States, with particular strength in the higher priced,
premium and super premium segments.



                                      -3-
<PAGE>   4
FORM 10-K 1995                                               CULBRO  CORPORATION

         General Cigar's products are distributed in the United States through
approximately 1,300 wholesale distributors and direct retail and chain store
accounts.

         The cigar business carried on by General Cigar in Jamaica and the
Dominican Republic, where the Corporation produces its highest priced, handmade
cigars, and warehouses certain of its inventories, and some of the sources of
tobacco purchased by General Cigar, are subject to the risks associated with
foreign operations.

         General Cigar's handmade cigars include Macanudo, Macanudo Vintage
Cabinet, Partagas, Partagas Limited Reserve, Temple Hall, Cohiba, Ramon Allones
and Canaria D'Oro. General Cigar cannot predict the effect on its cigar business
of a reopening of trade with Cuba, if that should occur, except that such trade
may adversely affect its handmade cigar manufacturing business.

         In 1993 General Cigar reappointed its independent sales agent in Europe
to take advantage of increased opportunities resulting from the eradication of
trade barriers among Common Market countries. In 1994 and 1995 direct contacts
were made with distributors in Eastern European and Far Eastern Countries to
explore possible sales opportunities in these emerging markets. Cigar export
sales, revenues from royalties and other revenues from foreign operations are
not material. General Cigar imports for sale in the United States on an
exclusive basis the Djeep lighter - a disposable butane gas lighter made in
France. In recent years, one customer has comprised up to 75% of General Cigar's
Djeep lighter sales. In 1994 Djeep and the disposable lighter industry
introduced a child resistant lighter in accordance with regulations promulgated
by the U.S. Consumer Products Safety Commission. In 1995, General Cigar
introduced a line of Macanudo and Partagas branded clothing. The line consists
of baseball caps, t-shirts, sweat-shirts and leather bomber jackets. General
Cigar sub-contracted out the embroidering work and sells the clothing through
retail tobacconists. Revenues from these products are not material.

                                      * * *

         While the substantial adverse publicity resulting from the 1964 Report
of the Surgeon General and subsequent reports with respect to studies linking
the use of tobacco with human disease have not been principally directed at
cigars, General Cigar believes such publicity and the health concerns it has
provoked contributed to the long decline of sales in the cigar industry.
The reported health effects upon non-smokers of so-called "passive" or
"environmental tobacco smoke" have caused the U.S. Surgeon General and others to
support restrictive legislation. Federal and state regulations designating
certain areas as non-smoking areas and the prohibition of smoking cigars in
certain areas have adversely affected the sales of cigar products. Various
legislative initiatives affecting tobacco, including warnings of carcinogenic
chemical contents, advertising bans and nondeductibility of advertising expenses
have been implemented or proposed. Tobacco products, including cigars, may also
face increased federal excise taxes and potential litigation to fund various
health care costs and legislative initiatives. The cigars made by General Cigar
are not subject to the regulations recently proposed by the U.S. Food and Drug
Administration. See also Item 3(a)(ii).

NURSERY PRODUCTS BUSINESS

         Imperial Nurseries, Inc. ("Imperial"), which previously operated as a
division of the Corporation, became in 1993 a wholly-owned subsidiary of the
Corporation. Imperial is a grower, distributor and broker of wholesale nursery
stock. The nursery industry is extremely fragmented, with the industry leader
having less than 1% of total market share. Imperial believes that its volume
places it among the ten largest nursery companies in the country.


                                      -4-
<PAGE>   5
FORM 10-K 1995                                               CULBRO  CORPORATION

         Imperial's growing operations are located on property owned by the
Corporation and leased to Imperial in Connecticut (1,000 acres) and in northern
Florida (350 acres). Such operations mainly serve landscapers, retail chain
store garden departments, retail nurseries and garden centers, and wholesale
nurseries and distributors. Imperial-grown products are also distributed through
the company's own wholesale horticultural sales and service centers. Imperial's
major markets service the Northeast, Mid-Atlantic, Southeast and Mid-West.
Nursery sales are seasonal, peaking in spring, and are affected by commercial
and residential building activity as well as weather conditions.

         Imperial operates eight wholesale sales and service centers which sell
a wide range of plant material and horticultural tools and products to the
trade. The centers owned by the Corporation and leased to Imperial, are located
in Windsor, Connecticut; Aston, Pennsylvania; Pittsburgh, Pennsylvania;
Columbus and Cincinnati, Ohio; White March, Maryland; and Manassas, Virginia.

         In 1995, Imperial continued to diversify its customer base in order to
reduce its dependence on a few large customers. Much of this growth continues to
be in independent retail garden centers and landscape contractors. Approximately
30% of the nursery stock sold by Imperial is purchased from other growers.
Imperial plans to reduce its current investment in field grown plant inventories
and limit future investments in this segment of the nursery products business.

         Growing and shipping capacity has been increased to meet the potential
volume and quality needs of Imperial's customers and to capitalize on any growth
in the Mid-Atlantic and Midwest markets.


INDUSTRIAL PRODUCTS BUSINESS

         Industrial Products consists of CMS Gilbreth Packaging Systems, Inc.
("CMS Gilbreth") which manufactures high quality plastic labels and a variety of
application equipment. These markets are both highly specialized and fragmented.
CMS Gilbreth believes it is a leader in the several markets in which it
participates.

         CMS Gilbreth has manufacturing plants in Bensalem and Bristol,
Pennsylvania (labeling materials), Turlock, California (application machinery),
and its headquarters is located in Trevose, Pennsylvania. It also has regional
sales offices located in Chicago, Illinois and Brussels, Belgium.

         CMS Gilbreth has established strategic business groups to develop new
markets for the company's product line. The company continued to commit to its
philosophy of continuous improvement by achieving ISO (International
Organization for Standardization) 9001 certification for its manufacturing
facilities. This comprehensive standard covers the quality policies and
procedures that CMS Gilbreth uses to design, manufacture, install and service
the product line.


                                      -5-
<PAGE>   6
FORM 10-K 1995                                               CULBRO  CORPORATION

         Operating profit at CMS Gilbreth increased in 1995. Higher operating
profit in the packaging machinery portion of this business was due to higher
sales and cost reduction benefits from closing a facility in 1994, partially
offset by higher spending on research and development and establishing a
Technology Center in Allentown, Pennsylvania to concentrate such research and
development in one location. The higher sales were due principally to the
introduction of new machines. Lower operating profit in the packaging materials
of CMS Gilbreth reflected a sales volume decline due to CMS Gilbreth's largest
customer changing its label technology, therefore reducing the quantity of
labels purchased from CMS Gilbreth. This change was phased in during 1995, and
is expected to be fully implemented in 1996.

         Certain of CMS Gilbreth's shrink label printing business is dependent
upon its ability to source raw material of print quality film. Such film is
available only from a limited number of suppliers, but CMS Gilbreth believes its
sources to be adequate.

         The machine manufacturing operations of Trine Manufacturing Company,
Inc. ("Trine"), a subsidiary of the Corporation and a separate legal entity
whose operations are integrated with CMS Gilbreth, are dependent on the validity
and enforceability of various patents issued to it or others by the United
States Patent and Trademark Office and internationally. Sales of its machines
may be affected by patents issued to others and the commercial exploitation of
technological advances in the design and production of labeling machinery may be
limited by such patents. The patent litigation which has involved Trine for many
years has been settled in a manner which should preclude indemnity actions
against it in the U.S. as a result of patents held by its major competitor. 
The settlement did not limit foreign actions against Trine by its foreign 
customers but none such are pending.

         Due to the nature of Trine's business, purchases of its machines are
often on a onetime basis. The major continuing business is for parts and
service. Trine's sales are principally in the food and beverage industry,
including substantial sales to soft drink bottlers. Approximately 35% of its
sales are to foreign customers. Trine sales in the domestic market are
principally to companies in the food and dairy industry, although other outlets
for its machinery are being developed.

         On February 1, 1996, the Corporation announced its intention to sell
CMS Gilbreth.

REAL ESTATE

         The Corporation's Real Estate segment is comprised of Culbro Land
Resources, Inc. and 387 Park Avenue South, the New York City building which the
Corporation owns and operates.

         CULBRO LAND RESOURCES

         The Corporation is engaged in the real estate development business on
portions of its land in Connecticut through Culbro Land Resources, Inc.
("Resources"), headquartered in Windsor, Connecticut. Resources develops
portions of the Corporation's properties for office, residential and commercial
use.

         Resources' most substantial development is Griffin Center in Windsor,
Connecticut and Griffin Center South in Bloomfield, Connecticut. Together these
master planned developments comprise approximately 600 acres, half of which have
been developed with nearly 2,000,000 square feet of office and industrial space.

         Griffin Center currently includes nine Class A corporate office
buildings built by Resources. Prior to 1983, Resources sold 70% interests in
five of the buildings to a bank-managed real estate investment fund, which is
currently seeking a purchaser for these properties. In 1984, Resources sold one
office building and a 70% interest in a second to an insurance company; and, in
1986, Resources sold a 70% interest in a building to the same insurance company.
Resources manages these properties for its investor-partners.


                                      -6-
<PAGE>   7
FORM 10-K 1995                                               CULBRO  CORPORATION

         At year end, approximately 80% of the rentable space in Griffin Center
was rented. Conditions in the commercial real estate market in the greater
Hartford area continue to hamper development activities. Although leasing
activities were strong in 1995, lower lease rates reflect the soft commercial
market. To attract and retain tenants, Resources continues to provide a variety
of amenities to maintain Griffin Center as a highly competitive, prime office
park offering quality services to tenants.

         Griffin Center South, a 130-acre tract, comprises fifteen buildings of
industrial and research/development space. Nine of these buildings have been
retained by Resources for rental and are 78% rented. The other buildings have
been built on land sold by Resources to commercial users who occupy the space.
Resources has a master plan state traffic certificate which allows for the
development of an additional 500,000 square feet of space.

         Resources owns a 600-acre tract of land near Bradley International
Airport and Interstate 91 now known as New England Tradeport. To date, 140,000
square feet of warehouse and light manufacturing space have been developed and
are 100% occupied. A state traffic certificate for the future development of 1.3
million square feet has been obtained for the Tradeport.

         Two additional Resources' parcels available for development include 33
acres in the Day Hill Technology Center in Windsor, and 100 acres in the South
Windsor Technology Center. State traffic certificates have been obtained for
500,000 square feet and 750,000 square feet of development, respectively.

         In 1988, Culbro Homes, Inc. ("Culbro Homes"), a subsidiary of
Resources, began infrastructure work at Walden Woods, a 153- acre site in
Windsor, Connecticut which is planned to contain more than 400 residential
units. Prior to 1992 Culbro Homes had built and sold 45 homes before
discontinuing the home building part of developing Walden Woods. Since then,
Culbro Homes has concluded agreements with two third-party home builders which
would ultimately transfer the building rights to a total of 110 units at Walden
Woods. A second section of Walden Woods was opened for development in 1993, and
another 64 homes have been constructed since then.

         The development of Resources' land in Simsbury, Connecticut commenced
in 1994 with the sale of an approved 14-lot residential subdivision to a local
builder. Resources has several other tracts in the Greater Hartford area
suitable for residential development but cannot predict when, or if, development
will begin due to the continuing slowdown in the residential market throughout
the region.

         387 PARK AVENUE SOUTH

         In 1983 the Corporation acquired all of the outstanding stock of a
corporation whose principal asset was an office building in New York City. The
building is 12 stories and contains approximately 210,000 square feet of rental
space. The purchase price was approximately $15 million. The Corporation has
advanced substantial amounts for building improvements. On April 21, 1995, the
Corporation entered into a $5 million mortgage on the building. Approximately
11% of the space in the building has been leased to the Corporation for use as
its offices and the remaining space is being leased or is available for lease as
commercial rental property. Currently approximately 16% of rentable space is
available for lease in this building. Results in 1995 increased slightly due to
higher rental income from temporary leases.


                                      -7-
<PAGE>   8
FORM 10-K 1995                                               CULBRO  CORPORATION

SUBSIDIARIES

         In 1987 the Corporation established several wholly-owned subsidiaries
and transferred to them the assets and liabilities of formerly unincorporated
divisions. The Corporation serves as the parent company of separate subsidiaries
operating its cigar, nursery, machine and labeling systems and land development
operations. Imperial Nurseries, Inc., formerly a Division of the Corporation,
was incorporated as a separate company in February 1993. See Exhibit 21 hereto.
In connection with the loan agreements entered into by the Corporation in
February 1993 (see Note 3 to the Consolidated Financial Statements), the
Corporation pledged the stock of all of its active subsidiaries as collateral
for such loans.

EMPLOYEES

         The Corporation employs approximately 2,910 persons (excluding seasonal
help employed in wrapper tobacco and nursery operations).

NOTE:    The brand names mentioned in this Report are trademarks owned by or
         licensed to the Corporation or its subsidiaries. All rights with
         respect thereto are reserved.

ITEM 2 - PROPERTIES

         LAND HOLDINGS

         The Corporation is a major landholder in the State of Connecticut and
owns some land in the State of Massachusetts, with holdings of approximately
5,600 acres, located principally in the Connecticut River Valley. In addition,
the Corporation owns approximately 1,100 acres in Florida, a portion of which is
used for Imperial Nurseries' growing operations, and owns sites for Imperial
Nurseries' seven sales and service centers. Each such center typically has a
warehouse/office facility and 10-15 acres of nursery stock.

         The book value of undeveloped land holdings, which includes land
currently needed for tobacco and nursery operations, owned by the Corporation
and Resources in the Connecticut River Valley is approximately $5,000,000. The
Corporation believes the fair market value is very substantially in excess of
such book value. The Corporation is developing certain of these holdings. (See
the description of Culbro Land Resources, Inc. under "Real Estate"). Such
development activities have increased the value of the Corporation's adjoining
properties. Of the Corporation's land not currently needed for tobacco or
nursery operations, only a portion is currently suitable for development.


                                      -8-
<PAGE>   9
FORM 10-K 1995                                               CULBRO  CORPORATION

         FACILITIES

         The table below sets forth the general character and location of
certain of the principal facilities of the Corporation and its subsidiaries. It
does not include the facilities of Culbro Land Resources, Inc. (See discussion
of Real Estate under Item 1 Business).

<TABLE>
<CAPTION>
                                OWNED                                                   APPROXIMATE
                                  OR                                                    FLOOR SPACE
     LOCATION                   LEASED             NATURE OF OPERATION                 (SQUARE FEET)
     --------                   ------             -------------------                 -------------

<S>                             <C>                <C>                                   <C>
New York, New York              Owned              Executive Offices
                                                     -Corporate Operations                25,000
Bensalem, Pennsylvania          Owned              Labeling Systems Operations            63,000
Bristol Township,                                                                       
  Pennsylvania                  Owned              Labeling Systems Operations           101,000
Turlock, California             Owned              Production Machinery                   32,000
Trevose, Pennsylvania           Leased             Executive Offices                    
                                                     -Labeling Systems Operations          9,000
Kingston, Jamaica, W.I.         Owned              Cigar Manufacturing                   117,000
Dothan, Alabama                 Leased (1)         Cigar Manufacturing & Warehousing     166,000
Hatfield, Massachusetts         Owned              Tobacco Warehousing & Processing       94,000
Santiago, Dominican                                                                     
  Republic                      Leased             Tobacco Processing & Cigar Mfg.       171,000
Granby, Connecticut             Owned              Executive Offices                    
                                                     -Nursery Operations                   8,000
Bloomfield, Connecticut         Owned              Executive Offices                    
                                                     -Cigar Operations                    11,000
</TABLE>



(1)    Industrial Revenue Bond financing lease

          In addition to the above, the Corporation owns a 48,000 square foot
warehouse in Alabama that is leased out.

          The Corporation and its General Cigar Co., Inc. subsidiary lease
approximately 80 acres of land for growing tobacco in the Dominican Republic. In
addition, the Corporation leases approximately four other facilities for
production support and related office locations which have an aggregate of
approximately 54,206 square feet of floor space.

          In May 1994 a building used by General Cigar Co., Inc. for farm
administration and tobacco warehousing in Windsor, Connecticut was totally
destroyed by fire. The Corporation is currently negotiating a settlement for
this loss with its insurance carrier.

          The Corporation's subsidiary, Club Macanudo, Inc. ("Club Macanudo"),
has entered into a 10 year lease for commercial space at 26 East 63rd Street in
New York City. Club Macanudo will operate a cigar bar at the location. The
Corporation is a guarantor of the lease payments of Club Macanudo.



                                      -9-
<PAGE>   10
FORM 10-K 1995                                               CULBRO  CORPORATION

ITEM 3 - LEGAL PROCEEDINGS

         The Corporation is involved in various legal actions including the
         following:

         (a)     LITIGATION

         (i)     TOWN OF WEST SPRINGFIELD V. CULBRO CORPORATION

                 In 1986 the State of Massachusetts closed certain public and
         private wells in the West Springfield, Massachusetts area, where the
         Corporation has farmed tobacco, because of contamination by ethylene
         dibromide (EDB) and other pesticides. Subsequently the Corporation's
         farms were identified as a probable source of the EDB contamination. In
         1987 the Town of West Springfield, Massachusetts filed suit in Hampden
         County Superior Court against the Corporation, another tobacco farmer
         and nine chemical manufacturers.

                 In November 1995 the parties agreed to settle this litigation.
         The Corporation agreed to pay $50,000 toward such settlement, all of
         which will be paid, or reimbursed to it, by its insurance carriers.

         (ii)    TOBACCO LITIGATION

                 In 1995 and early 1996 the Corporation's General Cigar Co.,
         Inc. subsidiary ("General Cigar") and/or the Corporation were named as
         defendants, together with a variety of numerous other tobacco product
         manufacturers and retailers, in six Florida state circuit court actions
         alleging adverse health effects from the use by the plaintiffs of such
         tobacco products. The Corporation and/or General Cigar were
         subsequently dismissed from two of these actions in October and
         November of 1995. General Cigar understands that these actions were
         filed by several law firms which, according to press reports,
         coordinate their filings, make substantially identical allegations and
         are considering many such lawsuits against numerous tobacco product
         manufacturers.

                 These are individual actions for products liability and are not
         class actions. They are based on traditional tort law and include fraud
         claims and are not based on recent legislation passed in Florida and
         certain other states relating to reimbursement of health care costs.
         These lawsuits are in the very preliminary stages and in certain of
         them the Corporation and General Cigar have not been served with
         process.

         (iii)   FRAUD LITIGATION - DRUG INVESTIGATION - WRONGFUL DISCHARGE 
                 LITIGATION

                 In the spring of 1995 General Cigar learned that packages of
         marijuana were passing through its Dothan, Alabama plant. The drugs
         were apparently being secreted by persons currently unknown in cigar
         shipping cartons originating from General Cigar's Kingston, Jamaica
         plant.

                 General Cigar immediately notified and has since fully
         cooperated with Customs and other federal and state officials
         throughout their investigation of this alleged drug trafficking. A
         federal Grand Jury in Birmingham, Alabama has the matter under
         investigation. As a result of the investigation, two former General
         Cigar non-management employees have been indicted and are awaiting
         trial on drug-related charges.


                                      -10-
<PAGE>   11
FORM 10-K 1995                                               CULBRO  CORPORATION

                 The investigation described above led in the summer of 1995 to
         the discovery of almost $1,000,000 of fraudulent trucking invoices
         submitted to General Cigar's Dothan facility by an Alabama trucking
         concern. As a result of this discovery General Cigar suspended and
         subsequently terminated one of its senior management employees because
         of his involvement in the processing of the trucking invoices, which
         were processed in a way which was an unacceptable deviation from the
         company's business practices. General Cigar has reason to believe this
         former employee and the principals of the trucking concern are expected
         to be indicted by the Alabama Grand Jury as a result of an
         investigation by the U.S. Attorney in Alabama.

                 In September 1995 General Cigar filed in Alabama federal court
         a civil suit under the RICO statute against the trucking concern. The
         former employee and the principals of the trucking concern were later
         added as defendants in that action.

                 In late October 1995 the former employee filed suit in the
         Judicial District of Hartford - New Britain (a Connecticut state court)
         against General Cigar and its president, alleging wrongful constructive
         termination and a variety of other claims of illegal activities by
         General Cigar, including payments to officials of foreign governments,
         pricing practices and election campaign contribution violations. The
         alleged improper campaign contributions aggregating $11,000 have been
         refunded by such campaigns and the Corporation is seeking a 
         conciliation agreement with respect thereto with the Federal Election
         Commission.  
                           
                 Subsequently General Cigar was served with a Grand Jury
         subpoena in Connecticut through which an Assistant U.S. Attorney is
         seeking any documents relevant to many of the charges contained in the
         lawsuit filed by the former employee.

            (b)  INVESTIGATION

                 In May 1995 the U.S. Securities and Exchange Commission ("SEC")
         began an investigation into trading in Culbro shares in the period
         prior to the Corporation's announcement of an agreement in principle to
         sell a 51% interest in its General Cigar subsidiary to Tabacalera, S.A.
         The New York Stock Exchange subsequently initiated a similar inquiry.
         The transaction with Tabacalera, S.A. was subsequently terminated.

                 The SEC staff was provided with numerous documents they
         requested and they interviewed several officers of the Corporation and
         General Cigar. The Corporation also supplied the SEC with numerous
         reports in various financial media and the general press about the
         resurgence in interest in cigars and the substantial interest in Culbro
         and General Cigar in early 1995. The Corporation does not know the
         status of these investigations except that they are apparently still
         pending.

                                      * * *

                 Management does not believe that the above described actions
         will have a material adverse effect upon the financial condition of the
         Corporation.

ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

          None


                                      -11-
<PAGE>   12
FORM 10-K 1995                                               CULBRO  CORPORATION

                                     PART II

ITEM 5.   MARKET FOR THE REGISTRANT'S COMMON STOCK
          AND RELATED SECURITY HOLDER MATTERS

          On February 15, 1996 the approximate number of record holders of
Common Stock of the Corporation was approximately 900 which does not include
beneficial owners whose shares are held of record in the names of brokers or
nominees. The closing market price as quoted on the New York Stock Exchange on
such date was $60.00 per share. The information appearing (i) under Quarterly
Data on Common Shares the Annual Report, (ii) in Note 4 to the Consolidated
Financial Statements and (iii) in Note 10 to the Consolidated Financial
Statements are hereby incorporated by reference.

ITEM 6.   SELECTED FINANCIAL DATA

          The Consolidated Statement of Operations and the Selected Financial
Data appearing in the Annual Report are hereby incorporated by reference.

ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS

         The Management's Discussion and Analysis in the Annual Report is hereby
incorporated by reference.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

         The Consolidated Financial Statements together with the Report of
Independent Accountants are hereby incorporated by reference.

ITEM 9.  DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

         Not applicable.

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE CORPORATION

         In accordance with General Instruction G-3 to Form 10-K, the
information called for in this Item 10 with respect to directors is not
presented here since such information is included in the definitive proxy
statement which involves the election of directors which will be filed pursuant
to Regulation 14A not later than 120 days after the close of the fiscal year,
and such information is hereby incorporated by reference from such proxy
statement.


                                      -12-
<PAGE>   13
FORM 10-K 1995                                               CULBRO  CORPORATION

          The following table sets forth the information called for in this Item
10 with respect to executive officers of the Corporation.

<TABLE>
<CAPTION>
NAME OF EXECUTIVE                          OTHER PRESENT          YEAR               OTHER POSITIONS
OFFICER AND                                POSITIONS AND          SERVICE            OR OTHER BUSINESS
PRESENT PRINCIPAL                          OFFICES (2)            AS EXECUTIVE       EXPERIENCE DURING
POSITION (1)                               (BEGINNING             OFFICER            PAST FIVE
(BEGINNING YEAR)               AGE          YEAR)                 BEGAN              YEARS (YEARS)      
------------------             ---         --------------         ------------       -----------------

<S>                            <C>         <C>                      <C>              <C>
EDGAR M. CULLMAN               78          Director                 1963             None
Chairman of the Board                      (1961)
  (1975)

EDGAR M. CULLMAN, JR.          50          Director                 1983             None
President (1984)                           (1982)


JOSEPH C. AIRD                 50          None                     1987             None
Senior Vice President-
Controller (1987)

JAY M. GREEN                   48          Treasurer                1988             None
Executive Vice                             (1988)
President Finance &
Administration (1988)

DAVID M. DANZIGER              30          None                     1996             Director of Operational Projects - The Eli Witt
Vice President                                                                       Company (7/95-1/96); Harvard Business School 
Corporate Development                                                                (MBA) (9/92-6/94); Deputy Director Budget
  (1996)                                                                             and Analysis - NYC Department of 
                                                                                     Transportation (8/90-7/92)

ANTHONY J. GALICI              38          None                     1995             None
Vice President-Assistant
Controller
  (1995)     

JANET A. KRAJEWSKI             41          None                     1993             None
Vice President-Taxes
  (1993)

MARY L. RAFFANIELLO            42          None                     1995             None
Vice President-
Human Resources (1995)

A. ROSS WOLLEN                 52          Senior Vice              1977             None
General Counsel                            President (1983)
   (1980)                                  & Secretary (1987)  
</TABLE>



                                      -13-
<PAGE>   14
FORM 10-K 1995                                               CULBRO  CORPORATION

(1) All of the Corporation's executive officers are subject to annual
reelection. There were and are no understandings or arrangements between any of
the Corporation's executive officers and any other person (except directors and
officers acting solely in their capacities as such) pursuant to which any
executive officer was selected as an officer. Mr. Green has an employment
agreement terminating in 1999. See page 17 of the Corporation's Proxy Statement
for the 1994 Annual Meeting. (See Item 14, Exhibit 10(E)). Positions not
otherwise identified are with the Corporation.

(2) Some of the Corporation's executive officers also serve as officers and
directors of The Eli Witt Company. Eli Witt became a public company on February
19, 1993 although it is not currently registered under the Securities and
Exchange Act of 1934. The Corporation owns 50.1% of Eli Witt's common stock. See
Note 8 to the Consolidated Financial Statements.

                                     PART IV

ITEM 14.   EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

         (a)(1) Financial Statements (annexed hereto): There are filed as part 
of this Report on Form 10-K: the Consent and Report of Independent Accountants;
and the Consolidated Financial Statements (including Notes) of the Corporation.
See Index To Financial Statements and Additional Financial Data.

         (a)(2) Schedules (annexed hereto): Financial Statement Schedules
required by Item 8 of Form 10-K for the fiscal years ended 1995, 1994 and 1993.
See Index To Financial Statements and Additional Financial Data.

         (a)(3) Exhibits. (Enumeration corresponds to the Exhibit Table, Item
601, Regulation S-K. Items not enumerated are not applicable).

                             (3) THE ARTICLES OF INCORPORATION AND BY-LAWS OF 
                    THE CORPORATION.

                             (A) The Articles of Incorporation, as amended to
                    date (Incorporated by reference to Exhibits to Form 10- K of
                    the Corporation filed for the fiscal year 1984 - (Exhibit
                    3(A)) and to the definitive proxy statement of Registrant,
                    dated April 11, 1988, for its Annual Meeting of Shareholders
                    held on May 12, 1988).

                             (B) The By-Laws, as amended to date (Incorporated 
                    by reference to Exhibits to Form 10-K of the Corporation 
                    filed for the fiscal year 1984 - (Exhibit 3(B)) and to the
                    definitive proxy statement of Registrant, dated April 11,
                    1988, for its Annual Meeting of Shareholders held on May 12,
                    1988).

                             (4) INSTRUMENTS DEFINING THE RIGHTS OF SECURITY
                    HOLDERS, INCLUDING INDENTURES.

                             (A) Note Purchase Agreement, dated July 15, 1988,
                    respecting 9.87% Series C Senior Notes due 1998 and 9.93%
                    Series D Senior Notes due 1998 (Incorporated by reference to
                    Exhibits to Form 10-Q of the Corporation filed for the
                    thirteen weeks ended July 2, 1988 - (Exhibit (a)(2)).

                             (B) Credit Agreement, dated May 24, 1990 with
                    several banks and Manufacturers Hanover Trust Company, as
                    Agent. (Incorporated by reference to Exhibits to Form 10-Q
                    of the Corporation filed for the thirteen weeks ended June
                    30, 1990 - (Exhibit (a)).


                                      -14-
<PAGE>   15
FORM 10-K 1995                                               CULBRO  CORPORATION

                             (C) Amended and Restated Note Purchase Agreement
                    among the Corporation and six institutional investors
                    relating to the private placement of $35,000,000 of Senior
                    Notes, dated July 15, 1988 amended and restated as of
                    February 19, 1993, including Exhibits (which have been
                    omitted but will be furnished to the Commission upon
                    request). (Incorporated by reference to Exhibits to Form
                    10-K of the Corporation filed for the fiscal year 1992).

                             (D) Amended and Restated Credit Agreement, dated
                    February 19, 1993 with several banks and Chemical Bank, as
                    Agent, including Exhibits (which have been omitted but will
                    be furnished to the Commission upon request). (Incorporated
                    by reference to Exhibits to Form 10-K of the Corporation
                    filed for the fiscal year 1992).

                             (E) Credit Agreement among The Eli Witt Company, 
                    The Several Lenders from Time to Time Parties Hereto and
                    Chemical Bank, as Agent, Dated as of February 19, 1993.
                    (Incorporated by reference to Exhibits to Form 10-K of the
                    Corporation filed for the fiscal year 1992).

                    Certain other documents evidencing indebtedness of the
          Corporation are not filed herewith in reliance upon the exemption
          provided by Item 601(b)(4)(iii)(A); the Registrant hereby undertakes
          to furnish a copy of such documents to the Commission upon request.

                             (10) EXECUTIVE COMPENSATION PLANS AND ARRANGEMENTS.

                             (A) 1992 Stock Plan of Registrant, dated December
                    10, 1993 (Incorporated by reference to the definitive proxy
                    statement of Registrant, dated March 3, 1993, for its Annual
                    Meeting of Shareholders held on April 8, 1993).

                             (B) Stock Option Plan for Non-employee Directors of
                    Registrant, dated December 10, 1993 (Incorporated by
                    reference to the definitive proxy statement of Registrant,
                    dated March 3, 1993, for its Annual Meeting of Shareholders
                    held on April 8, 1993).

                             (C) 1991 Employees Incentive Stock Option Plan of
                    Registrant (Incorporated by reference to the definitive
                    proxy statement of Registrant, dated April 9, 1991, for its
                    1991 Annual Meeting of Shareholders held on May 9, 1991).

                             (D) 1983 Employees Incentive Stock Option Plan of
                    Registrant, as amended (Incorporated by reference to the
                    definitive proxy statement of Registrant, dated April 6,
                    1983, for its Annual Meeting of Shareholders held on May 12,
                    1983 and to the Appendix filed pursuant to Rule 424(c) under
                    the Securities Act of 1933, as amended, dated March 3,
                    1987).

                             (E) Employment Contract between the Registrant and
                    Jay M. Green (Incorporated by reference to the definitive
                    proxy statement of Registrant, dated March 14, 1994, for its
                    Annual Meeting of Shareholders held April 7, 1994).

                             (F) Shareholders Agreement dated as of April 25,
                    1994 among Culbro Corporation, MS Distribution, Inc. and The
                    Eli Witt Company (Incorporated by reference to Exhibits to
                    Form 10-K of the Corporation filed for fiscal year 1994).

                             (G) Culbro Corporation 10% Exchangeable Note Due
                    1998 in the amount of $15,000,000, issued April 25, 1994 to
                    MS Distribution, Inc. (Incorporated by reference to Exhibits
                    to Form 10-K of the Corporation filed for fiscal year 1994).



                                      -15-
<PAGE>   16
FORM 10-K 1995                                               CULBRO  CORPORATION

                             (11) STATEMENT RE: COMPUTATION OF EARNINGS PER
                                  SHARE.

                             See Index to Financial Statements and Additional
                    Financial Data.

                             (13) ANNUAL REPORT TO SECURITY HOLDERS.

                             The Corporation's Annual Report to Shareholders for
                    1995 (annexed hereto). Such Annual Report, except for those
                    portions which are expressly incorporated by reference, is
                    furnished for the information of the Securities and Exchange
                    Commission and is not to be deemed "filed" or incorporated
                    by reference as part of this Form 10-K.

                             (21) SUBSIDIARIES.

                             List of Subsidiaries. See Index to Financial
                    Statements and Additional Financial Data.

                             (23) REPORT OF INDEPENDENT ACCOUNTANTS ON FINANCIAL
                                  STATEMENT SCHEDULES AND CONSENT OF INDEPENDENT
                                  ACCOUNTANTS. 

                             See Index to Financial Statements and Additional
                    Financial Data.

                             (27) FINANCIAL DATA SCHEDULE.

                             See Index to Financial Statements and Additional
                    Financial Data.

                             (28) UNDERTAKING.

                             For the purposes of complying with the amendments
                    to the rules governing Form S-8 (effective July 13, 1990)
                    under the Securities Act of 1933, the undersigned registrant
                    hereby undertakes as follows, which undertaking shall be
                    incorporated by reference to registrant's Registration
                    Statement on Form S-8 (Incorporated by reference to Exhibits
                    to Form 10-K of the Corporation filed for the fiscal year
                    1984 - (Exhibit 28)) and subsequent Form S-8's:

                             Insofar as indemnification for liabilities arising
                    under the Securities Act of 1933 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 Securities and Exchange Commission such
                    indemnification is against public policy as expressed in the
                    Securities Act of 1933 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 whether such
                    indemnification by it is against public policy as expressed
                    in the Act and will be governed by the final adjudication of
                    such issue.

                    (b) The Corporation filed a report on Form 8-K on October
                    3, 1995 stating that it had ended its previously announced
                    negotiations for Tabacalera, S.A. to acquire a 51% interest 
                    in General Cigar Co., Inc.
        
                    (c) See (a)(3) above.

                    (d) See Index to Financial Statements and Additional
                    Financial Data.


                                      -16-
<PAGE>   17
FORM 10-K 1995                                               CULBRO  CORPORATION

                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Corporation has duly caused this annual report to be
signed on its behalf by the undersigned, thereunto duly authorized.

                         CULBRO CORPORATION
                      
                         By  /s/ JAY M. GREEN         
                             ---------------------------------------------------
                             Jay M. Green
                             Executive Vice President-Finance and Administration
                     
Dated:  February 29, 1996

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this annual report has been signed by the following persons on behalf of the
Corporation and in the capacities indicated as of February 29, 1996.


   SIGNATURES                               TITLE
   ----------                               -----

/s/ BRUCE A. BARNET                        Director
----------------------------
(Bruce A. Barnet)

/s/ JOHN L. BERNBACH                       Director
----------------------------
(John L. Bernbach)

/s/ EDGAR M. CULLMAN                       Chairman of the Board, Director and
----------------------------
(Edgar M. Cullman)                         Principal Executive Officer

/s/ EDGAR M. CULLMAN, JR.                  President, Director and
----------------------------
(Edgar M. Cullman, Jr.)                    Principal Operating Officer

/s/ FREDERICK M. DANZIGER                  Director
----------------------------
(Frederick M. Danziger)

/s/ JOHN L. ERNST                          Director
----------------------------
(John L. Ernst)

/s/ JAY M. GREEN                           Executive Vice President and
----------------------------
(Jay M. Green)                             Principal Financial Officer

/s/ THOMAS C. ISRAEL                       Director
----------------------------
(Thomas C. Israel)

/s/ DAN W. LUFKIN                          Director
----------------------------
(Dan W. Lufkin)

/s/ GRAHAM V. SHERREN                      Director
----------------------------
(Graham V. Sherren)

/s/ PETER J. SOLOMON                       Director
----------------------------
(Peter J. Solomon)

/s/ FRANCIS T. VINCENT, JR.                Director
----------------------------
(Francis T. Vincent, Jr.)

/s/ JOSEPH C. AIRD                         Senior Vice President
----------------------------
(Joseph C. Aird)                           and Controller



                                      -17-
<PAGE>   18
                   CULBRO CORPORATION AND SUBSIDIARY COMPANIES

           INDEX TO FINANCIAL STATEMENTS AND ADDITIONAL FINANCIAL DATA

         The financial statements together with the report thereon of Price
Waterhouse LLP dated February 2, 1996, appearing in the accompanying 1995 Annual
Report to Shareholders, are incorporated by reference in this Form 10-K Annual
Report. With the exception of the aforementioned information and such other
information specifically incorporated by reference herein, the 1995 Annual
Report to Shareholders is not to be deemed filed or incorporated by reference as
part of this report.

         The following exhibits and additional financial data should be read in
conjunction with the financial statements in such 1995 Annual Report to
Shareholders. Schedules not included with this additional financial data have
been omitted because they are not applicable or the required information is
shown in the financial statements or notes thereto.


<TABLE>
<CAPTION>
                                                                                                   PAGE
                                                                                                   ----
         <S>               <C>                                                                   <C>
         Consent of Independent Accountants and Financial Statements of 
         Equity Investee - The Eli Witt Company                                                     F-1


         Schedules:

            VIII           Valuation and Qualifying Accounts and
                            Reserves                                                                S-1
                     
             XI            Real Estate and Accumulated Depreciation                             S-2/S-3

         Exhibit 11 -      Statement Re: Computation of Earnings Per Share                          E-1

         Exhibit 21 -      List of Subsidiaries                                                     E-2

         Exhibit 23 -      Report of Independent Accountants on Financial
                           Statement Schedules and Consent of Independent
                           Accountants                                                              E-3

         Exhibit 27 -      Financial Data Schedule                                                  E-4


</TABLE>           
<PAGE>   19
               CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 (No. 2 - 94202) of Culbro Corporation of our report dated
February 23, 1996 appearing in this Form 10-K.

/s/  Price Waterhouse LLP

PRICE WATERHOUSE LLP

Tampa, Florida
February 23, 1996




                                      F-1


<PAGE>   20
               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To the Board of Directors and Shareholders
of The Eli Witt Company

In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of operations, of cash flows and changes in
stockholders' equity present fairly, in all material respects, the financial
position of The Eli Witt Company and its subsidiaries at December 2, 1995 and
December 3, 1994, and the results of their operations and their cash flows for
each of the three years in the period ended December 2, 1995, in conformity with
generally accepted accounting principles. These financial statements are the
responsibility of the Company's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these statements in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.

The Eli Witt Company is a subsidiary of Culbro Corporation and, as disclosed in
the Notes accompanying the consolidated financial statements, has had extensive
transactions and relationships with Culbro Corporation. Because of these
relationships, it is possible that the terms of these transactions are not the
same as those that would result from transactions amoung wholly unrelated
parties.

/s/ Price Waterhouse LLP

PRICE WATERHOUSE LLP
Tampa, Florida
February 23, 1996

<PAGE>   21

The Eli Witt Company

CONSOLIDATED BALANCE SHEET
(dollars in thousands)
--------------------------------------------------------------------------------



<TABLE>
<CAPTION>
                                                             DECEMBER 2,  December 3,
ASSETS                                                          1995          1994
<S>                                                           <C>          <C>      
Cash                                                          $   8,769    $   9,216
Trade receivables, less allowance of $1,093 (1994 - $2,336)      55,424       64,576
Inventories                                                      43,288       54,576
Other current assets                                              1,310        1,860
                                                              ---------    ---------
      Total current assets                                      108,791      130,228

Property and equipment, net                                      37,651       43,353
Other assets                                                      7,664       15,535
                                                              ---------    ---------
      Total assets                                            $ 154,106    $ 189,116
                                                              =========    =========


LIABILITIES AND SHAREHOLDERS' EQUITY

Accounts payable and accrued expenses                         $  59,143    $  69,058
Current portion of long-term debt                                 9,316        8,151
                                                              ---------    ---------
      Total current liabilities                                  68,459       77,209
Long-term debt                                                   90,811       97,248
Other noncurrent liabilities                                     11,660       10,141

Commitments and contingencies (Notes 2 and 9)

Mandatorily redeemable Series B preferred stock                  19,150       17,650

Series C preferred stock                                          1,744        1,464
Series A preferred stock                                         12,011       10,080
Common stock                                                         23           23
Class C common stock                                                  3            3
Capital in excess of par value                                      994          994
Retained earnings (dividends in excess of)                      (50,749)     (25,696)
                                                              ---------    ---------
      Total liabilities and shareholders' equity              $ 154,106    $ 189,116
                                                              =========    =========
</TABLE>
                                 See Notes to Consolidated Financial Statements.

<PAGE>   22
The Eli Witt Company

CONSOLIDATED STATEMENT OF OPERATIONS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------


<TABLE>
<CAPTION>
                                                       1995           1994          1993
<S>                                                <C>            <C>            <C>       
NET SALES AND OTHER REVENUE                        $ 1,506,612    $ 1,521,796    $1,197,346

COSTS AND EXPENSES
   Cost of goods sold                                1,406,946      1,422,446     1,112,264
   Selling, general and administrative expenses        104,986        106,003        75,048
   Write-down of impaired assets                         3,645           --            --
   Restructuring charges                                  --            3,696          --
                                                   -----------    -----------    ----------

OPERATING PROFIT (LOSS)                                 (8,965)       (10,349)       10,034

   Interest expense, net                                 8,296          7,298         6,998
                                                   -----------    -----------    ----------
   (Loss) income before income taxes                   (17,261)       (17,647)        3,036

   Income tax (benefit) provision                        4,081         (3,236)          702
                                                   -----------    -----------    ----------

Net (loss) income                                  $   (21,342)   $   (14,411)   $    2,334
                                                   ===========    ===========    ==========

NET (LOSS) INCOME PER COMMON SHARE                 $     (9.65)   $     (7.40)   $      .25
                                                   ===========    ===========    ==========

AVERAGE COMMON SHARES OUTSTANDING                    2,595,000      2,359,245     1,930,769
                                                   ===========    ===========    ==========
</TABLE>


                 See Notes to Consolidated Financial Statements.

<PAGE>   23

The Eli Witt Company

CONSOLIDATED STATEMENT OF CASH FLOWS
(dollars in thousands)
--------------------------------------------------------------------------------


<TABLE>
<CAPTION>
                                                                 1995       1994        1993
<S>                                                           <C>         <C>         <C>     
OPERATING ACTIVITIES:
   Net (loss) income                                          $(21,342)   $(14,411)   $  2,334
   Adjustments to reconcile net income (loss) to net
    cash provided by (used in) operating activities:
      Depreciation and amortization                              8,021       7,332       4,553
      Gain on sale of distribution centers                      (1,400)       --          --
      Write-down of impaired assets                              3,645        --          --
      Non-cash interest expense                                    765         231        --
      Restructuring charge                                        --         3,696        --
      Deferred income taxes                                      4,081      (3,236)        428
      Negative goodwill amortization                              --          --          (623)
      Changes in assets and liabilities which increase
        (decrease) cash, net of effects from acquisitions:
        Trade receivables                                        5,914       6,950     (10,758)
        Intercompany receivable                                   --          --        19,473
        Inventories                                              8,321      19,876      61,838
        Other current assets                                       482       2,467       1,300
        Accounts payable and accrued expenses                   (9,910)     (5,025)     (8,358)
      Increases in other non-current liabilities                 1,519         237        (769)
                                                              --------    --------    --------

Net cash provided by operating activities                           96      18,117      69,418
                                                              --------    --------    --------

INVESTING ACTIVITIES:
   Proceeds from sale of distribution centers                    8,410        --          --
   Additions to property and equipment                          (2,801)     (2,629)     (3,413)
   Dispositions of property and equipment                          999       1,099       1,268
   Payments in connection with acquisitions, net of
    cash acquired                                                 --        (2,289)     (2,762)
   Other, net                                                      690        (273)       (366)
                                                              --------    --------    --------

Net cash provided by (used in) investing activities              7,298      (4,092)     (5,273)
                                                              --------    --------    --------

FINANCING ACTIVITIES:
   (Repayments) borrowings under bank financing, net            (9,625)      9,775      69,376
   Proceeds from issuance of convertible subordinated notes      5,000       3,000        --
   Principal payments on other debt                             (3,216)     (1,520)     (3,100)
   Proceeds from mortgages                                        --         8,000      10,000
   Repayment of bank indebtedness assumed
    in acquisition                                                --       (23,904)    (24,339)
   Repayment on mortgage                                          --        (8,000)       --
   Cash dividend to parent                                        --          --       (41,529)
   (Decrease) increase in intercompany debt, net                  --          --       (67,817)
                                                              --------    --------    --------

Net cash used in financing activities                           (7,841)    (12,649)    (57,409)
                                                              --------    --------    --------

Net change in cash                                                (447)      1,376       6,736

Cash at beginning of period                                      9,216       7,840       1,104
                                                              --------    --------    --------

Cash at end of period                                         $  8,769    $  9,216    $  7,840
                                                              ========    ========    ========
</TABLE>

                 See Notes to Consolidated Financial Statements.

<PAGE>   24

The Eli Witt Company

CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
(dollars in thousands)
--------------------------------------------------------------------------------


<TABLE>
<CAPTION>
                                                                                                            RETAINED
                                               SERIES C       SERIES A                          CAPITAL     EARNINGS
                                               PREFERRED      PREFERRED  COMMON   CLASS C      IN EXCESS (DIVIDENDS IN
                                                 STOCK          STOCK    STOCK  COMMON STOCK   PAR VALUE   EXCESS OF)
                                               ---------      ---------  ------ ------------   --------- -------------
<S>                                             <C>           <C>         <C>       <C>         <C>        <C>              
Balance November 28, 1992                       $ --          $   --      $17       $-          $ 4,438    $ 40,369  
Net income                                        --              --       --        -             --         2,334  
Dividend to parent company                        --              --       --        -           (7,435)    (49,094) 
Issuance of Class C common stock                  --              --       --        3            2,997        --    
Issuance of Series A preferred stock              --             9,300     --        -             --          --    
Accretion of Series A preferred stock             --               705     --        -             --          (705) 
Dividends accrued on                                                                                                 
 Series B preferred stock                         --              --       --        -             --        (1,150) 
                                                ------        --------    ---       --          -------    --------  
                                                                                                                     
Balance November 27, 1993                         --            10,005     17        3             --        (8,246) 
                                                                                                                     
Net loss                                          --              --       --        -             --       (14,411) 
Issuance of Series C                                                                                                 
   preferred stock                               1,321          (1,321)    --        -             --          --    
Accretion of Series A                                                                                                
   preferred stock                                --             1,396     --        -             --        (1,396) 
Dividends accrued on                                                                                                 
   Series B preferred stock                       --              --       --        -             --        (1,500) 
Accretion of Series C                                                                                                
   preferred stock                                 143            --       --        -             --          (143) 
Issuance of common stock                          --              --        6        -              994        --    
                                                ------        --------    ---       --          -------    --------  
                                                                                                                     
Balance December 3, 1994                         1,464          10,080     23        3              994     (25,696) 
                                                                                                                     
Net loss                                          --              --       --        -             --       (21,342) 
Accretion of Series A preferred stock             --             1,931     --        -             --        (1,931) 
Dividends accrued on Series B preferred stock     --              --       --        -             --        (1,500) 
Accretion of Series C preferred stock              280            --       --        -             --          (280) 
                                                ------        --------    ---       --          -------    --------  
                                                                                                                     
Balance December 2, 1995                        $1,744        $ 12,011    $23       $3          $   994    $(50,749) 
                                                ======        ========    ===       ==          =======    ========  
</TABLE>                                                              


                 See Notes to Consolidated Financial Statements.

<PAGE>   25

The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      BASIS OF PRESENTATION

      The consolidated financial statements reflect the accounts of The Eli Witt
      Company (the "Company") and its wholly-owned subsidiaries. Prior to
      February 19, 1993, the Company and Flaks, Inc. ("Flaks") were wholly-owned
      subsidiaries of Culbro Corporation ("Culbro"), but were operated as a
      single company. On February 19, 1993, in conjunction with the acquisition
      of Certified Grocers of Florida, Inc. described in Note 3, Flaks became a
      direct subsidiary of the Company in a transaction among related parties
      which has been accounted for in a manner similar to a pooling of
      interests. Accordingly, the accompanying consolidated financial statements
      reflect the consolidated financial position, consolidated results of
      operations and consolidated cash flows of the Company and Flaks after
      elimination of intercompany accounts and transactions.

      BUSINESS SEGMENT

      The Company is a wholesale distributor of cigarettes, tobacco products,
      candy, food, health and beauty aids and general merchandise and at
      December 2, 1995 was primarily concentrated in the southeastern United
      States. Cigarette sales represent a significant percentage of the
      Company's total net sales and other revenue.

      FISCAL YEAR

      The Company's fiscal year ends on the Saturday nearest November 30. Fiscal
      1995, 1994, and 1993 ended December 2, 1995, December 3, 1994, and
      November 27, 1993, respectively. The 1995 and 1993 fiscal years included
      52 weeks, the 1994 fiscal year included 53 weeks.

      INVENTORIES

      The Company's inventories are stated at the lower of cost or market using
      the last-in, first-out ("LIFO") method. The inventories of Flaks (which
      were liquidated in 1995) of $3,948 (1994) were stated on the first-in,
      first-out ("FIFO") method. Inventories consist mainly of cigarettes,
      tobacco, candy, food, health and beauty aids and general merchandise.

      LONG-LIVED ASSETS

      During fiscal 1995, the Company adopted Statement of Financial Accounting
      Standards ("SFAS") No. 121, "Accounting for the Impairment of Long-Lived
      Assets and for Long-Lived Assets to be Disposed Of." The statement
      establishes standards for measurement of recoverability of long-lived
      assets, certain identifiable intangibles, and goodwill based on changed
      circumstances identified to determine whether impairment of such assets
      exists.

                                        1
<PAGE>   26


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

      In accordance with the application of SFAS No. 121, the Company has
      reviewed the recoverability of goodwill and certain computer software
      development costs and has determined that the carrying amount of goodwill
      and software development costs should be adjusted by $1,645 and $2,000,
      respectively to their estimated recoverable costs. Accordingly, a total of
      $3,645 has been recognized as a loss in the accompanying Statement of
      Operations.

      PROPERTY AND EQUIPMENT

      Property and equipment are carried at cost. Depreciation is determined on
      a straight-line basis over the estimated useful asset lives for financial
      reporting purposes and principally on accelerated methods for tax
      purposes. Upon sale or retirement of property and equipment, the cost and
      related accumulated depreciation are removed from the accounts and the
      difference between book value and any proceeds realized on sale is charged
      or credited to income. Expenditures for maintenance and repairs are
      charged to income as incurred; renewals and improvements are capitalized.

      POSTRETIREMENT BENEFITS

      Effective at the beginning of the 1993 fiscal year, the Company adopted
      Statement of Financial Accounting Standards ("SFAS") No. 106 "Employers'
      Accounting for Postretirement Benefits Other Than Pensions," which
      requires the Company to recognize postretirement benefits on the accrual
      basis. The Company elected to amortize its accumulated liability for
      postretirement benefits over twenty years.

      REVENUE RECOGNITION

      Sales are recognized when product is delivered and accepted by the
      customer. Sales incentives are granted to customers based upon the volume
      of purchases. These sales incentives are recorded at the time of sale as a
      reduction of gross sales.

      PROMOTIONAL AND INCENTIVE PROGRAMS

      The Company records amounts relating to incentive programs for cigarette
      purchases on an accrual basis. Other promotional and incentive program
      amounts based on purchases are recognized as received. Prior to fiscal
      1994, the Company recorded amounts relating to incentive programs for
      cigarette purchases on a cash basis. Had the Company recorded such amounts
      on an accrual basis, the resulting reduction in cost of goods sold would
      have been approximately $1.1 million for fiscal 1993.

      INTANGIBLES

      Included in other assets are the excess of the costs of businesses
      acquired over the fair value of their net tangible assets of $1,866 and
      $3,622, at December 2, 1995 and December 3, 1994, which are being
      amortized on a straight-line basis over 25 years and

                                        2
<PAGE>   27


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

      $3 million related to Supply Agreements which are being amortized over ten
      years. Accumulated amortization of intangible assets resulting from
      business acquisitions was $328 and $294, at December 2, 1995 and December
      3, 1994, respectively.

      INCOME TAXES

      The Company uses the liability method of accounting for income taxes in
      accordance with SFAS No. 109, Accounting for Income Taxes.

      Prior to April 25, 1994, the Company joined with Culbro in filing
      consolidated federal income tax returns. In connection with the
      acquisition of the southern divisions of NCC L.P. on April 25, 1994,
      described in Note 3, the Company was disaffiliated as of that date from
      Culbro for purposes of filing federal income tax returns. In subsequent
      periods, the Company files a separate consolidated federal income tax
      return.

      EARNINGS (LOSS) PER SHARE

      Earnings (loss) per share of common stock are based on the weighted
      average number of shares of common stock outstanding during the year. Net
      income (loss), applicable to earnings (loss) per common share, consists of
      reported net income (loss) and dividend requirements and accretion on
      preferred stock.

      FAIR VALUE OF FINANCIAL INSTRUMENTS

      The amounts included in the financial statements for trade receivables,
      accounts payable and accrued expenses reflect their fair values because of
      the short-term maturity of these instruments. The fair values of the
      Company's other financial instruments are discussed in Notes 5 and 8.

2.    RESTRUCTURING

      1995

      On April 10, 1995, the Company sold the assets of its Denver and
      Albuquerque divisions for $8,510 and assumption of capital lease
      obligations of $269. Operating lease commitments with annual rental
      payments of $458 were also assumed by the buyer. The buyer obtained a
      non-compete agreement for the area serviced by these divisions for a
      period of three years. The Company recognized a gain on sale after all
      transaction costs of $1.4 million, which is included in other revenues in
      the consolidated statement of operations.

      During November 1995, the Company entered into a memorandum of
      understanding to sell the assets of its Baltimore and Richmond Divisions.
      The sale is contingent upon the

                                        3
<PAGE>   28


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

      negotiation of a definitive agreement. If the sale is consummated as
      proposed, the Company expects no significant gain or loss from the sale.

      1994

      Restructuring charges in 1994 principally relate to the closing of certain
      Eli Witt facilities and a corporate reorganization necessitated by the
      acquisition of NCC as described in Note 3.

3.    ACQUISITIONS

      ACQUISITION OF SOUTHERN DIVISIONS OF NCC L.P.

      On April 25, 1994, the Company purchased the net assets of the southern
      divisions of NCC L.P. ("NCC"), a limited partnership engaged in the
      wholesale distribution business for 595,000 shares of common stock of the
      Company. Concurrent with this acquisition, a partner of NCC purchased from
      Culbro, for proceeds of $12 million, a 10% exchangeable note of Culbro
      with a face value of $15 million and 400,000 shares of the Company's
      common stock held by Culbro. The Culbro note is exchangeable into the
      Series B Preferred Stock of the Company. The NCC partner also purchased
      for $3 million, a newly issued $5 million convertible subordinated note of
      the Company discounted to yield 12.5%. The note is convertible into Series
      D preferred stock of the Company. In addition, the Company amended the
      terms of the Series A preferred stock, provided for the issuance of the
      Series C preferred stock and split the Series A preferred stock into
      Series A and Series C preferred stock.

      The acquisition was accounted for as a purchase. The accompanying
      financial statements reflect the fair value of the assets and liabilities
      acquired. Prior to this acquisition, Culbro owned 85% of the outstanding
      common stock of the Company and former shareholders of Certified Grocers
      of Florida, Inc. ("Certified Grocers") held 15% of the outstanding common
      stock of the Company, which they received in connection with the
      acquisition of Certified Grocers in 1993. In connection with the NCC
      acquisition, NCC and one of its partners received a total of 995,000
      shares, described above, representing approximately 38% of the outstanding
      common stock of the Company. Culbro retained a 50.1% ownership in the
      common stock of the Company and the former shareholders of Certified
      Grocers now hold approximately 12% of the outstanding common stock of the
      Company.

                                        4
<PAGE>   29


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

      Unaudited pro forma condensed consolidated financial information, assuming
      the acquisition of NCC had taken place at the beginning of 1994 and 1993
      fiscal years and the acquisition of Certified Grocers (as described below)
      had taken place at the beginning of 1993, are as follows:

<TABLE>
<CAPTION>
                                               1994          1993
<S>                                        <C>            <C>       
      Net sales and other revenue          $ 1,739,000    $1,929,000
      Net loss                                 (21,000)      (10,000)
      Net loss per common share                  (9.39)        (4.90)
</TABLE>


      The unaudited pro forma condensed financial information is presented for
      comparative purposes and does not necessarily reflect the results of
      operations which would have occurred had the acquisitions been completed
      at the beginning of the years presented.

      ACQUISITION OF CERTIFIED GROCERS OF FLORIDA, INC.

      On February 19, 1993, pursuant to an Agreement and Plan of Merger (the
      "Agreement") dated November 3, 1992 the Company acquired Certified Grocers
      of Florida, Inc., a full-service grocery wholesale distribution company
      for approximately $12.9 million consisting of $9.3 million of Series A
      preferred stock and the direct costs of the acquisition. Pursuant to the
      Agreement, each share of Certified Grocers' common stock (except
      dissenters' shares) was converted to one share of newly issued Eli Witt
      Series A preferred stock and the shareholders of Certified Grocers who
      entered into three-year Supply Agreements received newly issued Eli Witt
      Class C common stock (300,000 shares of $0.01 par value Class C Common).
      The holders of the Certified Grocers' preferred stock and dissenting
      common shareholders had their shares redeemed at their respective
      liquidation values, which was approximately $600 in the aggregate. Culbro
      retained an 85% common equity interest in the Company after issuance of
      the Class C common stock. In addition, as part of the financing required
      to consummate the transaction, Culbro was issued $15 million of newly
      issued Eli Witt 10% Series B preferred stock which is mandatorily
      redeemable in five and one half years from the date of issuance.

      The acquisition was accounted for as a purchase and accordingly, the
      assets and liabilities of Certified Grocers were recorded at their
      estimated fair values and the accompanying financial statements include
      all activities subsequent to the acquisition date. Goodwill of
      approximately $1.9 million, reflecting the excess of the fair value of the
      Series A preferred stock and other costs and expenses related to the
      acquisition over the fair value of the net assets acquired, is being
      amortized over twenty-five years.

      In connection with the merger, the Company paid Culbro a Special Dividend,
      calculated based on the net book value (on a FIFO basis, as defined) less
      $25 million and other adjustments, and certain non-operating facilities of
      the Company with a net book value of $.4 million were transferred to
      Culbro. The Company's intercompany indebtedness to

                                        5
<PAGE>   30


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

      Culbro and Certified Grocers' indebtedness that was assumed by the Company
      were repaid from the $125 million of bank financing.

      Unaudited pro forma condensed consolidated financial information, assuming
      the acquisition of Certified Grocers had taken place at the beginning of
      the 1993 fiscal year, is as follows:

<TABLE>
<CAPTION>
                                                    1993
<S>                                              <C>        
      Net sales and other revenue                $ 1,262,000
      Net income                                         532
      Net loss per common share                         (.95)
</TABLE>

      The unaudited pro forma condensed financial information is presented for
      comparative purposes and does not necessarily reflect the results of
      operations which would have occurred had the acquisition been completed at
      the beginning of the years presented.

      ACQUISITION OF TRINITY DISTRIBUTORS

      In June 1993, the Company acquired certain assets and liabilities of
      Trinity Distributors, Inc. ("Trinity") for approximately $4 million.
      Trinity was a wholesale distributor of tobacco, candy, and other products
      servicing Texas and Louisiana. The effect of the acquisition was not
      significant, the transaction was financed through cash and notes payable
      and was accounted for as a purchase.

4.    RELATED PARTY TRANSACTIONS

      INTERCOMPANY DEBT AND INTEREST

      Prior to the acquisition of Certified Grocers and separate financing of
      the Company, the Company was financed under long-term debt and revolving
      credit facilities maintained by Culbro on behalf of all of its
      subsidiaries. Culbro charged the Company a 10% rate on the average monthly
      balance of the intercompany debt. Intercompany interest expense charges
      were $1,787 in 1993 prior to the Company obtaining its separate financing.
      Such intercompany interest expense charges may not be indicative of the
      level of interest charges the Company would have incurred if it were
      separately financed. Long-term debt includes indebtedness to Culbro
      consisting of a $2 million mortgage, and a $5.3 million subordinated note.
      See Note 5.

      INVENTORY PURCHASES AND EXPENSE ALLOCATIONS FROM RELATED PARTIES

      In connection with the establishment of its separate financing
      arrangement, the Company and Culbro executed a Management Services
      Agreement. This arrangement at December 2, 1995 under Culbro continues to
      provide the Company with certain

                                        6
<PAGE>   31


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

      administrative services primarily legal and tax. Prior to the execution of
      the Management Services Agreement, Culbro provided these and other
      services to the Company and the Company's results for the fiscal periods
      prior to the Management Services Agreement reflect the estimated costs of
      such services. The Company purchases certain tobacco products from a
      subsidiary of Culbro.

      A summary of these related party purchases and charges is as follows:
<TABLE>
<CAPTION>

                                                      1995     1994     1993
<S>                                                  <C>      <C>      <C>    
      COSTS OF GOODS SOLD                                                     
      Tobacco products purchased                     $2,872   $3,336   $2,334 
                                                     ======   ======   ====== 
                                                                              
      SELLING, GENERAL AND ADMINISTRATIVE EXPENSES                            
      Culbro general and administrative service                               
        cost allocation                              $  350   $  410   $  462 
      Insurance - workers' compensation and                                   
        property/liability                             --       --         72 
      Third-party administrative services              --       --         82 
                                                     ------   ------   ------ 
                                                     $  350   $  410   $  616 
                                                     ======   ======   ====== 
</TABLE>

      Such intercompany charges for selling, general and administrative expenses
      may not be indicative of the level of charges the Company would have
      incurred if the goods or services were obtained from an unrelated third
      party.

                                        7
<PAGE>   32


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

5. LONG-TERM DEBT

      Long-term debt includes:

<TABLE>
<CAPTION>
                                                                                 Amount Outstanding

                                                                       Loan         DECEMBER 2,      December 3,
                                                                    Commitment         1995             1994
<S>                                                                 <C>              <C>              <C>       
      Credit agreement:
      Revolving credit agreement                                    $   83,000       $   65,500       $   57,000
      Term loan, payable in 1996                                         5,500            5,500           23,625
                                                                    ----------       ----------       ----------
                                                                    $   88,500           71,000           80,625

      Mortgages payable, primarily at 10%, secured
       by warehouses                                                                     11,679           11,819
      Subordinated notes payable to shareholders,
       due in 1998                                                                        8,942            3,231
      Other indebtedness                                                                  2,268            2,309
      Capital leases                                                                      6,238            7,415
                                                                                     ----------       ----------
                                                                                        100,127          105,399
      Less amount due within one year                                                     9,316            8,151
                                                                                     ----------       ----------
      Long-term                                                                      $   90,811       $   97,248
                                                                                     ==========       ==========
</TABLE>



      At December 2, 1995, the Company was operating under a waiver of certain
      covenants of its 1993 Credit Agreement. On January 31, 1996 the Agreement
      was amended. In accordance with the terms of the amendment interest rates
      are at LIBOR plus 3-1/4% and prime plus 1-1/2%, and the commitment will be
      reduced to $72.5 million in connection with the anticipated receipt of
      proceeds from the transaction described in Note 2. An amendment fee
      ranging from $500 to $1,000 will be eliminated if the amounts outstanding
      under the Agreement are repaid during 1996. The amendment established a
      revised termination date of February 1, 1997, eliminated covenants
      relating to the maintenance of minimum earnings to fixed charges and
      working capital, and established or modified covenants to maintain minimum
      net worth and EBIT, as defined. Unamortized deferred financing costs of
      $2.4 million at December 2, 1995 related to the Credit Agreement are
      included in other assets and are being amortized over the life of the
      Credit Agreement. The Credit Agreement has a commitment fee of .5% for
      unused lines. Annual payment requirements excluding the revolving
      facilities of the Credit Agreement and capital leases for the years 1997
      through 1999 are $450, $13,033, and $7,520.

      The Credit Agreement is secured by accounts receivable, inventories and
      certain property and equipment, and places certain restrictions on the
      Company, including

                                        8
<PAGE>   33


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------
       prohibition of dividends, limitation on capital expenditures, lease
      commitments, ownership changes, and assets sales.

      On April 21, 1995, Culbro purchased from the Company a 10% subordinated
      note in the amount of $5 million. The note matures in 1998. Proceeds of
      the note were used for general working capital purposes.

      At December 2, 1995, the Company held interest rate swap agreements with
      major banks as a hedge against interest rate exposure on variable rate
      debt. The agreements which expire in March 1996, effectively convert $30
      million of variable rate debt under the Credit Agreement to fixed rate
      debt at an average rate of 8.0%. The difference to be paid or received on
      the interest rate swap agreements is charged or credited to interest
      expense over the life of the swap agreements. The effect of the swap
      agreements, including certain agreements which expired in 1995, was to
      decrease interest expense in 1995 by $524 and to increase interest expense
      in 1994 and 1993 by $200 and $558, respectively, when interest rates
      varied from the swap rates. The Company considers the fixed rate and
      variable rate financial instruments, excluding the related party mortgage,
      to be representative of current market interest rates and, accordingly,
      the recorded amounts approximate their present fair market value.

                                        9

<PAGE>   34


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

6. INCOME TAXES

      The provision (benefit) for income taxes charged (credited) to operations
was as follows:

<TABLE>
<CAPTION>
                                      1995      1994     1993
<S>                                  <C>      <C>        <C>  
     Current:                                                 
       Federal                       $ --     $  --      $204 
       State                           --        --        70 
     Deferred, principally federal    4,081    (3,236)    428 
                                     ------   -------    ---- 
                                                              
     Total provision (benefit)       $4,081   $(3,236)   $702 
                                     ======   =======    ==== 
</TABLE>

      Deferred tax liabilities (assets) are comprised of the following at
      December 2, 1995 and December 3, 1994:

<TABLE>
<CAPTION>
                                                  1995           1994
<S>                                           <C>            <C>          
      LIFO inventory                          $     5,984    $       6,955
      Depreciation                                  5,135            5,251
      Other                                         2,402              928
                                               ----------      -----------

      Gross deferred tax liabilities               13,521           13,134
                                               ----------       ----------

      Tax net operating loss carryforward         (17,300)          (9,646)
      Pension liability                            (3,617)          (3,355)
      Restructuring reserves                       (2,707)          (3,211)
      Insurance and compensation reserves          (1,959)          (2,288)
      Other                                        (1,928)          (2,470)
                                              -----------       ----------

      Gross deferred tax assets                   (27,511)         (20,970)
                                              -----------       ----------

      Valuation allowance                          13,990            3,755
                                              -----------      -----------

      Net deferred tax asset                  $       -        $    (4,081)
                                              ===========      ===========
</TABLE>

                                       10
<PAGE>   35


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

      The provision for income taxes differs from the amount of income tax
      determined by applying the applicable U.S. statutory federal income tax
      rate to pretax income from continuing operations as a result of the
      following differences:

<TABLE>
<CAPTION>
                                                            1995              1994             1993
<S>                                                       <C>              <C>             <C>        
      Federal tax (benefit) expense at statutory rate     $   (5,869)      $   (5,993)     $     1,032
      Increase in valuation allowance                         10,235            3,358              -
      State and local income tax (benefit)                      (684)            (698)              66
      Negative goodwill                                          -                -               (212)
      Other                                                      399               97             (184)
                                                         -----------       ----------      -----------

                                                         $     4,081       $   (3,236)     $       702
                                                         ===========       ==========      ===========
</TABLE>

      The Company has net operating loss carryforwards of $45,500 including
      $7,800 related to Certified Grocers. The Internal Revenue code limits
      utilization of the Certified Grocers' net operating loss carryforwards to
      $624 per year. Net operating loss carryforwards expire substantially
      between 2006 and 2010.

      Net operating losses are recognized to the extent of deferred tax
      liabilities that will reverse in the carryforward period and certain tax
      planning strategies identified by management. The valuation allowance has
      been increased to fully reserve for the net deferred tax asset that more
      than likely will not be realized, resulting in an increase in the
      valuation allowance for deferred tax assets of $10,235 during fiscal year
      1995.

7.    EMPLOYEE RETIREMENT BENEFITS

      The Company maintains a noncontributory defined benefit pension plan which
      formerly provided for benefits to employees until 1992 when benefits were
      curtailed. The Plan provided benefits based on employees' years of service
      and compensation. Contributions to the Plan are made in accordance with
      the provisions of the Employee Retirement Income Security Act of 1974.

      Pension expense included in the consolidated statement of operations was
      as follows:

<TABLE>
<CAPTION>
                                                                        1995             1994             1993
<S>                                                               <C>              <C>              <C>         
      Administrative costs                                        $        163     $        161     $        162
      Interest on projected benefit obligations                          1,157            1,123            1,114
      Actual return on plan assets                                      (1,637)            (312)            (955)
      Net amortization and deferral of gains (losses)                    1,001            (411)              271
                                                                  ------------    ------------      ------------

      Net pension expense                                         $        684     $        561     $        592
                                                                  ============     ============     ============
</TABLE>

                                       11
<PAGE>   36


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

   At December 2, 1995 and December 3, 1994, the funded status of the Plan was
as follows:

<TABLE>
<CAPTION>
                                                      1995     1994
<S>                                                 <C>       <C>    
Plan assets as fair value, primarily equities
  and fixed income instruments                      $ 8,171   $ 7,621

Present value of benefits earned by participants,
  including vested benefit of $15,432 and
  $13,567 at December 2, 1995 and December 3,
  1994, respectively                                 15,579    13,835
                                                    -------   -------

Present value of benefit obligations in excess
  of plan assets                                      7,408     6,214

Unrecognized net gain                                   381     1,218
                                                    -------   -------


Net pension liability included in consolidated
  balance sheet                                     $ 7,789   $ 7,432
                                                    =======   =======
</TABLE>

      Discount rates of 7.5% and 8.5% were used to compute the present value of
      pension benefits at December 2, 1995 and December 3, 1994, respectively.
      The expected rate of return on pension plan assets in 1995, 1994, and 1993
      was estimated at 9% representing the average long-term rate expected from
      investment of the Plan's assets.

      The Company also maintains The Eli Witt Company Savings Plan which
      formerly provided employer matching contributions at the rate of 60% of
      employees' contributions. During fiscal 1994, the rate of employer
      matching was reduced to 30%, and matching contributions were discontinued
      in November 1994. Such contributions when made are limited to 5% of such
      employee's eligible compensation. The Company's matching contribution in
      1994 was $499 and 1993 was $384.

      The Company also provides other postretirement benefits, principally
      health and life insurance benefits, to certain of its retired employees.
      Effective at the beginning of the 1993 fiscal year, the Company adopted
      SFAS No. 106, "Employers' Accounting for Postretirement Benefits Other
      Than Pensions." This statement required the Company to recognize
      postretirement benefits other than pensions on the accrual basis and
      record a liability for the present value of its unfunded accumulated
      postretirement benefit obligation. Previously, the Company expensed the
      cost of postretirement benefits when paid. The Company has elected to
      recognize the cumulative effect of the change in accounting for other
      postretirement benefits by amortizing the accumulated obligation

                                       12
<PAGE>   37


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

      over 20 years. The components of periodic expense for other postretirement
      benefits were as follows:

<TABLE>
<CAPTION>
                                                     1995    1994   1993
<S>                                                 <C>      <C>    <C>    
      Service cost - benefits earned during year    $  41    $ 53   $ 58   
      Interest cost on accumulated postretirement                          
         benefit obligation                           365     389    349   
      Amortization of unrecognized (gain)/loss         (5)     14    --    
      Amortization of accumulated postretirement                           
         benefit obligation                           246     246    246   
                                                    -----    ----   ----   
                                                                           
      Total expense                                 $ 647    $702   $653   
                                                    =====    ====   ====   
</TABLE>

      At December 2, 1995 and December 3, 1994, the actuarial present value of
      the Company's future liability for these postretirement benefits, was as
      follows:

<TABLE>
<CAPTION>
                                                                       1995           1994
<S>                                                                 <C>            <C>        
        Retirees                                                    $   3,755      $  4,136
        Active plan participants                                        1,006           822
                                                                    ---------      --------
                                                                        4,761         4,958
        Less:  Unrecognized transition obligation                      (4,180)       (4,426)
                Unrecognized experience (gain)/loss                        37          (104)
                                                                    ---------      --------

        Net liability included in consolidated balance sheet        $     618      $    428
                                                                    =========      ========
</TABLE>


      The accumulated postretirement benefit obligation was determined using a
      discount rate of 7.5% and 8.5% at December 2, 1995 and December 3, 1994,
      respectively. Because the Company's obligation for retirees' medical
      benefits is fixed, any increase in the medical cost trend would have no
      effect on the accumulated postretirement benefit obligation, service cost
      or interest cost.

      In connection with the Certified Grocers' acquisition, the Company assumed
      postretirement benefits for current and former management personnel. The
      remaining obligation of $807 is included in the accompanying consolidated
      balance sheet.

      During 1995, the Company's Board of Directors approved the 1995 Long Term
      Incentive Unit Plan which provides for grant of up to 250,000 stock units.
      The Plan provides for payment subsequent to an initial public offering or
      a change of control of the Company. Each unit granted is to be paid
      equivalent to the value of one share of common stock, as defined, in cash
      or common stock, if approved by the Board of Directors. At December 2,
      1995, 90,930 units were outstanding to officers and directors which will
      vest in June, 1996.

                                       13
<PAGE>   38


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

8. CAPITAL ACCOUNTS

      The consolidated capital accounts as of December 2, 1995 are comprised of
      the following:

      SERIES A PREFERRED STOCK

      Dividends on the Series A preferred commence accruing February 19, 1996.
      Dividends are cumulative and will be accrued at a rate of 8% through
      February 28, 1997, and thereafter the dividend rate will be adjusted
      quarterly with a ceiling of 12% and a floor of 7%. Dividend payments will
      be prohibited by the terms of the credit agreement and the priority of
      Series B and Series C preferred stock. The Series A preferred stock is
      redeemable at the Company's option at the stated value, plus all accrued
      dividends. An aggregate of $8 million of Series A and Series C preferred
      stock is subject to mandatory redemption if there is a change in control,
      as defined, or sale of 50% or more of the common stock of the Company, as
      defined. Holders of the Series A preferred stock do not have voting
      rights, however, they can appoint two non-voting representatives to the
      Company's Board of Directors. Also, the holders of Series A preferred
      stock may appoint a majority number of representatives to the Company's
      Board of Directors if certain events occur. The face value of the Series A
      preferred stock was discounted to its fair value at the date of issuance.
      The difference between the fair value of the Series A preferred stock and
      its stated value is being accreted using the interest method. This stock
      has a $.005 par value per share, and there are 788,199 shares authorized
      and outstanding.

      SERIES B PREFERRED STOCK

      Dividends on the Series B preferred are cumulative and accrue at 10%.
      Dividend payments are restricted under the Credit Agreement. The Series B
      preferred stock has liquidation preferences prior to all other classes or
      series of preferred and common stock, except the Series C preferred stock.
      The holder of the Series B preferred stock does not have voting rights.
      This Series B stock including accrued dividends is mandatorily redeemable
      in 1998 subject to loan covenant restrictions. As of December 2, 1995, no
      dividends on the Series B preferred stock had been declared or paid.
      Dividends aggregating $4,150 have been accrued and included in the
      preferred stock balance. The $19,150 recorded value approximates the
      redemption value of the Series B preferred stock. This stock has a $.01
      par value per share, and there are 15,000 shares authorized and
      outstanding.

      SERIES C PREFERRED STOCK

      Dividends are cumulative and commence accruing February 19, 1996. The
      dividend rate will be 8% through February 28, 1997 and thereafter the
      dividend rate will be adjusted quarterly with a ceiling of 12% and a floor
      of 7%. Dividend payments and liquidation preferences of the Series C
      preferred stock have priority to all other classes or series of

                                       14
<PAGE>   39


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

      preferred and common stock. The Series C preferred stock is redeemable at
      the Company's option at the stated value plus all accrued dividends.
      Holders of Series C preferred stock do not have voting rights. The face
      value of the Series C preferred stock of $2,000 was discounted to its
      pro-rata fair value prior to being split from the Series A preferred. The
      difference between the fair value of the Series C preferred stock and its
      stated value is being accreted using the interest method. This stock has a
      $.005 par value per share, and there are 788,199 shares authorized and
      outstanding.

      COMMON STOCK

      There are 5,000,000 shares of common stock authorized and 2,295,000 shares
      issued and outstanding at December 2, 1995 and December 3, 1994.

      CLASS C COMMON STOCK

      In connection with the acquisition of Certified Grocers, the Company
      issued 300,000 shares of $.01 par value Class C common stock in exchange
      for three-year Supply Agreements. Holders of the Class C common stock may
      elect two voting members of the Board of Directors of the Company. The
      Class C common stock is convertible into ordinary common stock at any time
      at the election of the holders, has anti-dilution protection, stock sale
      participation rights, and piggy-back registration rights. There are
      300,000 shares authorized, issued, and outstanding.

9.    COMMITMENTS AND CONTINGENCIES

      LEASE COMMITMENTS

      The Company has noncancelable leases relating principally to
      transportation equipment, data processing, and warehouse and office
      facilities.

                                       15
<PAGE>   40

The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

      CAPITAL LEASES

      Future minimum lease payments under capital leases and the present value
      of such payments as of December 2, 1995 were:

<TABLE>

             <S>                                                      <C>     
                1996                                                  $  2,379
                1997                                                     2,180
                1998                                                     1,409
                1999                                                       921
                2000                                                       355
              Later years                                                  133
                                                                      --------
              Total minimum lease payments                               7,377

                Less:  Amounts representing interest                     1,139
                                                                      --------
              Present value of minimum lease payments (a)             $  6,238
                                                                      ========
</TABLE>

      (a)  Includes current portion of $1,929 at December 2, 1995.

      At December 2, 1995, machinery and equipment included capital leases
      amounting to $4,777 (1994 - $6,672), which is net of accumulated
      depreciation of $6,446 (1994 - $6,533). Depreciation expense relating to
      capital leases was $1,514 in 1995 (1994 - $1,099; 1993 - $824).

      OPERATING LEASES

      Future minimum rental payments under noncancellable leases as of December
      2, 1995 were:

<TABLE>
             <S>                                                        <C>
              1996                                                      $  5,973
              1997                                                         4,459
              1998                                                         4,159
              1999                                                         2,884
              2000                                                         1,961
              Later years                                                  8,196
                                                                        --------
              Total minimum lease payments                              $ 27,632
                                                                        ========
</TABLE>


      Total rental expense for all operating leases in 1995 was $8,226 (1994 -
      $7,687; 1993 - $3,375).

      LITIGATION

      The Company is subject to legal proceedings and claims which arise in the
      ordinary course of business. In the opinion of management, the ultimate
      resolution with respect to these actions will not have a material adverse
      effect upon the consolidated financial position of the Company.

                                       16
<PAGE>   41


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------

10.   SUPPLEMENTARY CONSOLIDATED FINANCIAL STATEMENT INFORMATION

      NET SALES AND OTHER REVENUE

      Excise taxes paid on cigarette sales in 1995 were $180,000 (1994 -
      $180,000; 1993 - $130,000) and are included in net sales and other revenue
      and cost of goods sold. Negative goodwill amortization in 1993 which
      related to the acquisition of the Company by Culbro was $623 and is
      included in net sales and other revenue.

      INVENTORIES

      The cost of the Company's inventories at LIFO was $43,288 and $50,628 at
      December 2, 1995 and December 3, 1994, respectively. On a FIFO basis, the
      cost of the inventories would have been $58,983 and $64,803, respectively.
      Cost of sales on a FIFO basis would have been lower by $1,520 and $875 in
      1995 and 1994, respectively, and higher by $2,090 in 1993. The Company
      believes that the LIFO method generally results in a better matching of
      costs and revenues. This supplemental information is presented for
      comparative purposes.

      PROPERTY AND EQUIPMENT

      Property and equipment, net, consist of:

<TABLE>
<CAPTION>
                                   DEPRECIABLE             DEC. 2            DEC. 3
                                      LIVES                 1995              1994
<S>                                <C>                  <C>               <C>         
      Land                                              $     2,606       $     2,606
      Buildings                        30                    23,515            23,952
      Machinery and equipment          4-10                  27,367            32,789
                                                        -----------       -----------
                                                             53,488            59,347

      Accumulated depreciation                              (15,837)          (15,994)
                                                        -----------       -----------
                                                        $    37,651       $    43,353
                                                        ===========       ===========
</TABLE>

      ACCOUNTS PAYABLE AND ACCRUED EXPENSES

      Accounts payable and accrued expenses include trade payables of $47,432
      (1994 - $52,697) and various accrued expenses totaling $11,711 (1994 -
      $16,361).

      OTHER NONCURRENT LIABILITIES

      Other noncurrent liabilities include pension liability of $7,471 (1994 -
      $7,432).

                                       17
<PAGE>   42


The Eli Witt Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(dollars in thousands except per share data)
--------------------------------------------------------------------------------



      SUPPLEMENTAL CASH FLOW INFORMATION

<TABLE>
<CAPTION>
                                              1995              1994              1993
<S>                                       <C>              <C>               <C>          
      Cash paid during the year for:
        Interest - third party:
           Bank debt                      $      5,990     $       5,670     $       4,086
           Other indebtedness                    1,628             1,539               940
                                          ------------        ----------       -----------

                                          $      7,618     $       7,209     $       5,026
                                          ============     =============     =============
</TABLE>



      In addition, the Company had the following non-cash investing and
financing activities:

<TABLE>
<CAPTION>
                                                        1995      1994        1993
<S>                                                    <C>      <C>         <C>     
      Capital lease assets and obligations             $2,071   $  5,838    $    388
                                                       ------   --------    --------
      Dividend of Series B preferred stock to parent   $ --     $   --      $ 15,000
                                                       ------   --------    --------
      Dividend accrued on Series B preferred stock     $1,500   $  1,500    $  1,150
                                                       ------   --------    --------
      Class C common stock issued in exchange
       for supply contracts                            $ --     $   --      $  3,000
                                                       ------   --------    --------
      Fair value of assets acquired, including
       goodwill                                        $ --     $ 50,770    $ 64,295
      Liabilities assumed                                --      (47,437)    (48,990)
      Series A preferred stock issued                    --         --        (9,300)
      Long term debt issued                              --         --        (2,467)
      Common stock issued                                --       (1,000)       --
                                                       ------   --------    --------
      Payments in connection with acquisitions           --        2,333       3,538

      Cash acquired                                      --          (44)       (776)
                                                       ------   --------    --------
      Payments in connection with acquisitions,
       net of cash acquired                            $ --     $  2,289    $  2,762
                                                       ======   ========    ========
</TABLE>



                                       18
<PAGE>   43
                               CULBRO CORPORATION
         SCHEDULE VIII - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
                             (dollars in thousands)


<TABLE>
<CAPTION>
                                              Balance at        Charged to       Charged to        Deductions          Balance at
                                              beginning         costs and           other             from                end
Description                                     of year         expenses          accounts          reserves            of year
-----------                                   ----------        ----------        ---------        ----------          ----------

<S>                                              <C>             <C>                 <C>             <C>                 <C>   

                                           FOR THE FISCAL YEAR ENDED DECEMBER 2, 1995
                                           ------------------------------------------
Reserves:

Uncollectible accounts - Trade                   $1,426          $  545              $ 20            $  832    (1)       $1,159
                                                 ======          ======              ====            ======              ======

Inventories                                      $1,479          $1,374              $ 65            $1,470    (2)       $1,448
                                                 ======          ======              ====            ======              ======

                                           FOR THE FISCAL YEAR ENDED DECEMBER 3, 1994
                                           ------------------------------------------
Reserves:

                                                                                                      1,220    (3)

Uncollectible accounts - Trade                   $2,364          $  764              $ 39            $  521    (1)       $1,426
                                                 ======          ======              ====            ======              ======

Inventories                                      $  832          $1,422              $ 90            $  865    (2)       $1,479
                                                 ======          ======              ====            ======              ======

                                           FOR THE FISCAL YEAR ENDED NOVEMBER 27, 1993
                                           ------------------------------------------
Reserves:

Uncollectible accounts - Trade                   $2,650          $1,332              $617            $2,235    (1)       $2,364
                                                 ======          ======              ====            ======              ======

Inventories                                      $1,247          $  534              $ -             $  949    (2)       $  832
                                                 ======          ======              ====            ======              ======
</TABLE>



NOTES:

(1) Accounts receivable written-off.
(2) Inventories disposed.
(3) Deconsolidation of Eli Witt.


                                      S-1

<PAGE>   44
                               CULBRO CORPORATION
             SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION
                             (dollars in thousands)

<TABLE>
<CAPTION>
                                              Cost Capitalized
                                                Subsequent             Gross Amount
                              Initial Cost     to Acquisition       At December 2, 1995
                            ---------------   ----------------    ------------------------

                    Encum-           Bldg &           Carrying            Bldg &              Accum    Date of    Date of     Depr
Description        brances   Land    Impr.    Impr     Costs      Land    Impr       Total    Depr     Constr      Acq        Life
-----------        -------   ----   -------  -------  --------    ----   -------     -----   -------   -------    -------     -----


<S>                 <C>     <C>     <C>      <C>       <C>      <C>      <C>        <C>        <C>      <C>       <C>        <C>
Land - CT           $    -  $2,925  $    -   $ 6,981   $   80   $3,005   $ 6,981    $9,986     ($288)

Restaurant
Bloomfield, CT           -       1       -     1,266        -        1     1,266     1,267      (458)   1983                 40 yrs

Rsdntl Develpmt
Windsor, CT              -      78       -     1,764    2,156       78     3,920     3,998

Comm. Office Bldg  
Bloomfield, CT         736      47       -     2,190        -       47     2,190     2,237    (1,069)   1977                 40 yrs

Comm. Office Bldg
Bloomfield CT            -       3       -     1,815        -        3     1,815     1,818      (503)   1985                 40 yrs

Comm. Office Bldg
Bloomfield, CT           -       1       -     1,542       24        1     1,566     1,567      (263)   1988                 40 yrs

Comm. Office Bldg                                                                               (288)
Bloomfield CT            -       1       -     1,452       23        1     1,475     1,476              1988                 40 yrs

Comm. Office Bldg
Bloomfield, CT           -       1       -       666        -        1       666       667      (140)   1988                 40 yrs

Comm. Office Bldg
Bloomfield CT            -       5       -     3,288       40        5     3,328     3,333      (386)   1991                 40 yrs

Comm. Office Bldg
E. Granby, CT        1,972      74       -     3,148        -       74     3,148     3,222    (1,530)   1978                 40 yrs

Comm. Office Bldg
E. Granby, CT            -      32   1,723       179        -       32     1,902     1,934      (441)             1989       40 yrs

Comm. Office Bldg  
Windsor, CT          3,817      69     ---     4,415      149       68     4,565     4,633      (813)   1989                 40 yrs
                    ------  ------  ------   -------   ------   ------   -------   -------   -------  
                                         -
                    $6,525  $3,237  $1,723   $28,706   $2,472   $3,316   $32,822   $36,138   ($6,179)                             
                    ======  ======  ======   =======   ======   ======   =======   =======   ========  
</TABLE>



                                      S-2

<PAGE>   45
                               CULBRO CORPORATION

             SCHEDULE XI - REAL ESTATE AND ACCUMULATED DEPRECIATION
                             (dollars in thousands)


<TABLE>
<CAPTION>
FISCAL YEAR ENDED DECEMBER 2, 1995
----------------------------------
                                                                              Cost                    Reserve
                                                                             -------                  --------

<S>                                                                          <C>                      <C>     
Balance at beginning of period                                               $36,491                  ($5,118)
   Changes during the period:
     Improvements                                                                802
     Additions to reserve charged to costs and expenses                                                  (814)
     Reclassification                                                                                    (247)
     Cost of sales                                                            (1,155)                                             
                                                                             -------                  ------- 

Balance at end of period                                                     $36,138                  ($6,179)
                                                                             =======                  ========


FISCAL YEAR ENDED DECEMBER 3, 1994
----------------------------------
                                                                              Cost                    Reserve
                                                                             -------                  ------- 

Balance at beginning of period                                               $39,676                  ($4,338)
   Changes during the period:
     Improvements                                                              1,624
     Additions to reserve charged to costs and expenses                                                  (780)
     Cost of sales (including writeoffs)                                      (4,809)                         
                                                                             -------                  -------

Balance at end of period                                                     $36,491                  ($5,118)
                                                                             =======                  ========

FISCAL YEAR ENDED NOVEMBER 27, 1993
-----------------------------------
                                                                               Cost                   Reserve
                                                                             -------                  ------- 

Balance at beginning of period                                               $39,328                  ($3,664)
   Changes during the period:
     Improvements                                                              1,352
     Additions to reserve charged to costs and expenses                                                  (748)
     Cost of sales                                                            (1,004)                      74
                                                                             -------                  ------- 
Balance at end of period                                                     $39,676                  ($4,338)
                                                                             =======                  ======= 
</TABLE>


                                      S-3


<PAGE>   46
                               EXHIBIT INDEX


                     Exhibit No.           Description
                     -----------           -----------

                             (3) THE ARTICLES OF INCORPORATION AND BY-LAWS OF 
                    THE CORPORATION.

                             (A) The Articles of Incorporation, as amended to
                    date (Incorporated by reference to Exhibits to Form 10- K of
                    the Corporation filed for the fiscal year 1984 - (Exhibit
                    3(A)) and to the definitive proxy statement of Registrant,
                    dated April 11, 1988, for its Annual Meeting of Shareholders
                    held on May 12, 1988).

                             (B) The By-Laws, as amended to date (Incorporated 
                    by reference to Exhibits to Form 10-K of the Corporation 
                    filed for the fiscal year 1984 - (Exhibit 3(B)) and to the
                    definitive proxy statement of Registrant, dated April 11,
                    1988, for its Annual Meeting of Shareholders held on May 12,
                    1988).

                             (4) INSTRUMENTS DEFINING THE RIGHTS OF SECURITY
                    HOLDERS, INCLUDING INDENTURES.

                             (A) Note Purchase Agreement, dated July 15, 1988,
                    respecting 9.87% Series C Senior Notes due 1998 and 9.93%
                    Series D Senior Notes due 1998 (Incorporated by reference to
                    Exhibits to Form 10-Q of the Corporation filed for the
                    thirteen weeks ended July 2, 1988 - (Exhibit (a)(2)).

                             (B) Credit Agreement, dated May 24, 1990 with
                    several banks and Manufacturers Hanover Trust Company, as
                    Agent. (Incorporated by reference to Exhibits to Form 10-Q
                    of the Corporation filed for the thirteen weeks ended June
                    30, 1990 - (Exhibit (a)).
                                      
                             (C) Amended and Restated Note Purchase Agreement
                    among the Corporation and six institutional investors
                    relating to the private placement of $35,000,000 of Senior
                    Notes, dated July 15, 1988 amended and restated as of
                    February 19, 1993, including Exhibits (which have been
                    omitted but will be furnished to the Commission upon
                    request). (Incorporated by reference to Exhibits to Form
                    10-K of the Corporation filed for the fiscal year 1992).

                             (D) Amended and Restated Credit Agreement, dated
                    February 19, 1993 with several banks and Chemical Bank, as
                    Agent, including Exhibits (which have been omitted but will
                    be furnished to the Commission upon request). (Incorporated
                    by reference to Exhibits to Form 10-K of the Corporation
                    filed for the fiscal year 1992).

                             (E) Credit Agreement among The Eli Witt Company, 
                    The Several Lenders from Time to Time Parties Hereto and
                    Chemical Bank, as Agent, Dated as of February 19, 1993.
                    (Incorporated by reference to Exhibits to Form 10-K of the
                    Corporation filed for the fiscal year 1992).

                    Certain other documents evidencing indebtedness of the
          Corporation are not filed herewith in reliance upon the exemption
          provided by Item 601(b)(4)(iii)(A); the Registrant hereby undertakes
          to furnish a copy of such documents to the Commission upon request.

                             (10) EXECUTIVE COMPENSATION PLANS AND ARRANGEMENTS.

                             (A) 1992 Stock Plan of Registrant, dated December
                    10, 1993 (Incorporated by reference to the definitive proxy
                    statement of Registrant, dated March 3, 1993, for its Annual
                    Meeting of Shareholders held on April 8, 1993).

                             (B) Stock Option Plan for Non-employee Directors of
                    Registrant, dated December 10, 1993 (Incorporated by
                    reference to the definitive proxy statement of Registrant,
                    dated March 3, 1993, for its Annual Meeting of Shareholders
                    held on April 8, 1993).

                             (C) 1991 Employees Incentive Stock Option Plan of
                    Registrant (Incorporated by reference to the definitive
                    proxy statement of Registrant, dated April 9, 1991, for its
                    1991 Annual Meeting of Shareholders held on May 9, 1991).

                             (D) 1983 Employees Incentive Stock Option Plan of
                    Registrant, as amended (Incorporated by reference to the
                    definitive proxy statement of Registrant, dated April 6,
                    1983, for its Annual Meeting of Shareholders held on May 12,
                    1983 and to the Appendix filed pursuant to Rule 424(c) under
                    the Securities Act of 1933, as amended, dated March 3,
                    1987).

                             (E) Employment Contract between the Registrant and
                    Jay M. Green (Incorporated by reference to the definitive
                    proxy statement of Registrant, dated March 14, 1994, for its
                    Annual Meeting of Shareholders held April 7, 1994).

                             (F) Shareholders Agreement dated as of April 25,
                    1994 among Culbro Corporation, MS Distribution, Inc. and The
                    Eli Witt Company (Incorporated by reference to Exhibits to
                    Form 10-K of the Corporation filed for fiscal year 1994).

                             (G) Culbro Corporation 10% Exchangeable Note Due
                    1998 in the amount of $15,000,000, issued April 25, 1994 to
                    MS Distribution, Inc. (Incorporated by reference to Exhibits
                    to Form 10-K of the Corporation filed for fiscal year 1994).
                                      
                             (11) STATEMENT RE: COMPUTATION OF EARNINGS PER
                                  SHARE.

                             See Index to Financial Statements and Additional
                    Financial Data.

                             (13) ANNUAL REPORT TO SECURITY HOLDERS.

                             The Corporation's Annual Report to Shareholders for
                    1995 (annexed hereto). Such Annual Report, except for those
                    portions which are expressly incorporated by reference, is
                    furnished for the information of the Securities and Exchange
                    Commission and is not to be deemed "filed" or incorporated
                    by reference as part of this Form 10-K.

                             (21) SUBSIDIARIES.

                             List of Subsidiaries. See Index to Financial
                    Statements and Additional Financial Data.

                             (23) REPORT OF INDEPENDENT ACCOUNTANTS ON FINANCIAL
                                  STATEMENT SCHEDULES AND CONSENT OF INDEPENDENT
                                  ACCOUNTANTS. 

                             See Index to Financial Statements and Additional
                    Financial Data.

                             (27) FINANCIAL DATA SCHEDULE.

                             See Index to Financial Statements and Additional
                    Financial Data.

                             (28) UNDERTAKING.

                             For the purposes of complying with the amendments
                    to the rules governing Form S-8 (effective July 13, 1990)
                    under the Securities Act of 1933, the undersigned registrant
                    hereby undertakes as follows, which undertaking shall be
                    incorporated by reference to registrant's Registration
                    Statement on Form S-8 (Incorporated by reference to Exhibits
                    to Form 10-K of the Corporation filed for the fiscal year
                    1984 - (Exhibit 28)) and subsequent Form S-8's:

                             Insofar as indemnification for liabilities arising
                    under the Securities Act of 1933 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 Securities and Exchange Commission such
                    indemnification is against public policy as expressed in the
                    Securities Act of 1933 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 whether such
                    indemnification by it is against public policy as expressed
                    in the Act and will be governed by the final adjudication of
                    such issue.