10-Q

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

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

         For the period ended:   June 28, 2002

                                       OR

[   ]    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934
                        For the transition period from       to

                        Commission file number: 001-13403

                        American Italian Pasta Company
             (Exact name of Registrant as specified in its charter)


                Delaware                                  84-1032638
      (State or other jurisdiction of                  (I.R.S. Employer
       incorporation or organization)                 Identification No.)

4100 N. Mulberry Drive, Suite 200, Kansas City, Missouri      64116
 (Address of principal executive office)                    (Zip Code)

       Registrant's telephone number, including area code: (816) 584-5000


- --------------------------------------------------------------------------------
             (Former name, former address and former fiscal year, if
                           changed since last report)

         Indicate by check mark whether the Registrant has (1) filed all
documents and reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the Registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

         The number of shares outstanding as of August 5, 2002 of the
Registrant's Class A Convertible Common Stock was 17,954,952 and there were no
shares outstanding of the Class B Common Stock.

                         American Italian Pasta Company
                                    Form 10-Q
                           Quarter Ended June 30, 2002


                                Table of Contents


Part I - Financial Information                                                                             Page

         Item 1.  Financial Statements (unaudited)

                  Consolidated Balance Sheets at June 30, 2002 and
                  September 30, 2001.                                     3

                  Consolidated Statements of Income for the three
                  months ended June 30, 2002 and 2001.                    4

                  Consolidated Statements of Income for the nine
                  months ended June 30, 2002 and 2001.                    5

                  Consolidated Statement of Stockholders' Equity
                  for the nine months ended June 30, 2002.                6

                  Consolidated Statements of Cash Flows for the nine
                  months ended June 30, 2002 and 2001.                    7

                  Notes to Consolidated Financial Statements              8


         Item 2.  Management's Discussion and Analysis of
                           Financial Condition and Results of Operations  9

         Item 3.  Quantitative and Qualitative Disclosures About
                           Market Risk                                   14

Part II - Other Information

         Item 1.           Legal Proceedings                             15

         Item 2.           Changes in Securities                         15

         Item 3.           Defaults Upon Senior Securities               15

         Item 4.           Submission of Matters to a Vote of Security
                           Holders                                       15

         Item 5.           Other Information                             15

         Item 6.           Exhibits and Reports on Form 8-K              15


Signature Page                                                           16

                         PART I - FINANCIAL INFORMATION
             Item 1 - Consolidated Financial Statements (Unaudited)

                         AMERICAN ITALIAN PASTA COMPANY
                           Consolidated Balance Sheets
                                                                 June 30,2002 Sept. 30, 2001
                                                                       (In thousands)
                                                                         (Unaudited)

Assets
Current assets:
   Cash and temporary investments                                 $   9,015    $   5,284
   Trade and other receivables                                       39,450       37,546
   Prepaid expenses and deposits                                      8,059        8,024
   Inventory                                                         56,676       43,866
   Deferred income taxes                                              4,057        3,565
                                                                  ---------    ---------
Total current assets                                                117,257       98,285
Property, plant and equipment:
     Land and improvements                                           11,086        8,123
   Buildings                                                        103,269       99,548
     Plant and mill equipment                                       309,402      269,751
   Furniture, fixtures and equipment                                 14,071       10,957
                                                                  ---------    ---------
                                                                    437,828      388,379
     Accumulated depreciation                                       (94,546)     (80,453)
                                                                  ---------    ---------
                                                                    343,282      307,926
     Construction in progress                                        34,162       31,236
                                                                  ---------    ---------
Total property, plant and equipment                                 377,444      339,162
Intangible assets                                                   117,042      116,707
Other assets                                                          5,853        5,989
                                                                  ---------    ---------
Total assets                                                      $ 617,596    $ 560,143
                                                                  =========    =========

Liabilities and stockholders' equity
Current liabilities:
     Accounts payable                                             $  18,021    $  22,416
     Accrued expenses                                                14,571       19,652
     Income tax payable                                               1,711          877
     Current maturities of long-term debt                             4,879        1,559
                                                                  ---------    ---------
Total current liabilities                                            39,182       44,504
Long-term debt                                                      249,392      236,783
Deferred income taxes                                                43,737       33,664
Commitments and contingencies
Stockholders' equity:
   Preferred stock, $.001 par value:
         Authorized shares - 10,000,000                                --           --
          Issued and outstanding shares - none
     Class A common stock, $.001 par value:
         Authorized shares - 75,000,000                                  20           19
         Issued and outstanding shares - 19,658,629 and
         18,003,648 at June 30, 2002 and 19,217,694 and
         17,562,713 at September 30, 2001 Class B common stock,
         $.001 par value:
          Authorized shares - 25,000,000                               --           --
          Issued and outstanding shares - none
     Additional paid-in capital                                     212,958      202,674
     Treasury stock                                                 (34,394)     (34,394)
     Notes receivable from officers                                     (61)         (61)
     Unearned compensation                                             (423)        (223)
     Retained earnings                                              110,481       80,563
   Accumulated other comprehensive income (loss)                     (3,296)      (3,386)
                                                                  ---------    ---------
Total stockholders' equity                                          285,285      245,192
                                                                  ---------    ---------
Total liabilities and stockholders' equity                        $ 617,596    $ 560,143
                                                                  =========    =========

See accompanying notes to consolidated financial statements.


                                       3

                         AMERICAN ITALIAN PASTA COMPANY

                        Consolidated Statements of Income

                                                   Three Months Ended
                                                        June 30,
                                                     2002      2001
                                                    (In thousands)
                                                      (Unaudited)


Revenues                                            $91,773   $77,300
Cost of goods sold                                   59,283    52,018
                                                    -------   -------
Gross profit                                         32,490    25,282
Selling and marketing expense                        10,841     7,413
General and administrative expense                    2,811     2,735
                                                    -------   -------
Operating profit                                     18,838    15,134
Interest expense, net                                 2,161     2,161
                                                    -------   -------
Income before income tax expense                     16,677    12,973
Income tax expense                                    5,670     4,482
                                                    -------   -------
Net income                                          $11,007   $ 8,491
                                                    =======   =======

Earnings Per Common Share:
    Net income per common share                     $   .61   $   .49
                                                    =======   =======

    Weighted-average common shares outstanding       17,969    17,498
                                                    =======   =======

Earnings Per Common Share - Assuming Dilution:
    Net income per common share assuming dilution   $   .59   $   .46
                                                    =======   =======

    Weighted-average common shares outstanding       18,806    18,353
                                                    =======   =======



See accompanying notes to consolidated financial statements.




                                       4

                         AMERICAN ITALIAN PASTA COMPANY

                        Consolidated Statements of Income

                                                    Nine Months Ended
                                                        June 30,
                                                     2002       2001
                                                     (In thousands)
                                                       (Unaudited)


Revenues                                            $278,619   $218,734
Cost of goods sold                                   179,568    150,974
                                                    --------   --------
Gross profit                                          99,051     67,760
Selling and marketing expense                         37,482     19,975
General and administrative expense                     8,997      7,480
Provision for acquisition expenses                      --        1,827
                                                    --------   --------
Operating profit                                      52,572     38,478
Interest expense, net                                  7,139      5,762
                                                    --------   --------
Income before income tax expense                      45,433     32,716
Income tax expense                                    15,515     11,287
                                                    --------   --------
Net income                                          $ 29,918   $ 21,429
                                                    ========   ========

Earnings Per Common Share:

    Net income per common share                     $   1.68   $   1.23
                                                    ========   ========

    Weighted-average common shares outstanding        17,824     17,360
                                                    ========   ========

Earnings Per Common Share - Assuming Dilution:

    Net income per common share assuming dilution   $   1.60   $   1.19
                                                    ========   ========

    Weighted-average common shares outstanding        18,671     18,050
                                                    ========   ========



See accompanying notes to consolidated financial statements.


                                       5

                         AMERICAN ITALIAN PASTA COMPANY

                 Consolidated Statement of Stockholders' Equity

                                                               Nine months
                                                              ended June 30,
                                                                  2002
                                                          ----------------------
                                                             (In thousands)
                                                               (unaudited)
Class A Common Shares
  Balance, beginning of period                                      19,218
  Issuance of shares of Class A Common stock to option holders
   & other issuances                                                   441
                                                                 ---------
  Balance, end of period                                            19,659
                                                                 =========

Class A Common Stock
  Balance, beginning of period                                   $      19
  Issuance of shares of Class A Common stock to option holders
   & other issuances                                                     1
                                                                 ---------
  Balance, end of period                                         $      20
                                                                 =========

Additional Paid-in Capital
  Balance, beginning of period                                   $ 202,674
  Issuance of shares of Class A Common stock to option holders
   & other issuances                                                 5,910
  Tax benefit from stock compensation                                4,374
                                                                 ---------
  Balance, end of period                                         $ 212,958
                                                                 =========

Treasury Stock
  Balance, beginning and end of period                           $ (34,394)
                                                                 =========

Notes Receivable from Officers
  Balance, beginning and end of period                           $     (61)
                                                                 =========

Unearned Compensation
  Balance, beginning of period                                   $    (223)
  Issuance of common stock                                            (284)
  Earned compensation                                                   84
                                                                 ---------
  Balance, end of period                                         $    (423)
                                                                 =========

Accumulated Other Comprehensive Income (Loss)
  Balance, beginning of period                                   $  (3,386)
  Foreign currency translation adjustment                            1,292
  Interest rate swaps fair value adjustment                         (1,202)
                                                                 ---------
  Balance, end of period                                         $  (3,296)
                                                                 =========

Retained Earnings
  Balance, beginning of period                                   $  80,563
  Net income                                                        29,918
                                                                 ---------
  Balance, end of period                                           110,481
                                                                 ---------

Total Stockholders' Equity                                       $ 285,285
                                                                 =========



See accompanying notes to consolidated financial statements.


                                       6

                         AMERICAN ITALIAN PASTA COMPANY

                      Consolidated Statements of Cash Flows

                                                                             Nine Months Ended
                                                                                 June 30,
                                                                             2002        2001
                                                                              (In thousands)
                                                                                (Unaudited)


Operating activities:
Net income                                                                $ 29,918    $ 21,429
Adjustments to reconcile net income to net cash provided by operations:
    Depreciation and amortization                                           15,156      12,530
    Deferred income tax                                                     10,073       9,254
    Changes in operating assets and liabilities,
      net of Mueller's brand acquisition:
           Trade and other receivables                                      (2,153)     (5,566)
           Prepaid expenses and deposits                                     1,977      (3,604)
           Inventory                                                       (12,634)     (2,946)
           Accounts payable and accrued expenses                            (9,302)      4,791
           Income tax payable                                                4,951         719
           Other                                                              (869)     (1,445)
                                                                          --------    --------
Net cash provided by operating activities                                   37,117      35,162

Investing activities:
Purchase of Mueller's pasta brand                                             --       (23,816)
Additions to property, plant and equipment                                 (48,979)    (25,284)
Other                                                                       (2,000)       --
                                                                          --------    --------
Net cash used in investing activities                                      (50,979)    (49,100)

Financing activities:
Proceeds from issuance of debt                                              39,473      24,000
Principal payments on debt and capital lease obligations                   (27,537)     (3,114)
Proceeds from issuance of common stock, net of
   issuance costs                                                            5,628       1,809
Purchases of Treasury Stock                                                   --        (3,032)
                                                                          --------    --------
Net cash provided by financing activities                                   17,564      19,663
Effect of exchange rate changes on cash                                         29      (2,121)
                                                                          --------    --------
Net increase in cash and temporary investments                               3,731       3,604

Cash and temporary investments at beginning of period                        5,284       6,677
                                                                          --------    --------
Cash and temporary investments at end of period                           $  9,015    $ 10,281
                                                                          ========    ========


See accompanying notes to consolidated financial statements.


                                       7

                         AMERICAN ITALIAN PASTA COMPANY
                   Notes to Consolidated Financial Statements

                                  June 30, 2002


1.       Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared
in accordance with accounting principles generally accepted in the United States
for interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by accounting principles generally accepted
in the United States for complete financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. Operating results for the
three and nine-month periods ended June 30, 2002 are not necessarily indicative
of the results that may be expected for the year ended September 30, 2002. These
financial statements should be read in conjunction with the consolidated
financial statements and footnotes thereto and management's discussion and
analysis thereof included in the Company's Annual Report on Form 10-K for the
year ended September 29, 2001 and management's discussion and analysis included
in Item 2 hereof.

American Italian Pasta Company (the "Company" or "AIPC") uses a 52/53-week
financial reporting cycle with a fiscal year which ends on the last Friday of
September or the first Friday of October. The Company's first three fiscal
quarters end on the Friday last preceding December 31, March 31, and June 30 or
the first Friday of the following month. For purposes of this Form 10-Q, the
third fiscal quarter of fiscal years 2002 and 2001 both included thirteen weeks
of activity and are described as the three month periods ended June 30, 2002 and
2001.

2.   Earnings Per Share

Dilutive securities, consisting of options to purchase the Company's Class A
common stock, included in the calculation of diluted weighted average common
shares were 837,000 and 847,000 shares for the three-month and nine-month
periods ended June 30, 2002, respectively, and 855,000 and 690,000 shares for
the three-month and nine-month periods ended June 30, 2001, respectively.

A summary of the Company's stock option activity:

                                                      Number of Shares
         Outstanding at September 30, 2001                 2,630,864
            Exercised                                       (426,396)
            Granted                                          142,990
            Canceled/Expired                                 (58,567)
                                                           ---------
         Outstanding at June 30, 2002                      2,288,891
                                                           =========

3.   Continued Dumping and Subsidy Offset Act of 2000

On October 28, 2000, the U.S. government enacted the "Continued Dumping and
Subsidy Offset Act of 2000" (the "Act") which provides that assessed
anti-dumping and subsidy duties liquidated by the Department of Commerce after
October 1, 2000 will be distributed to affected domestic producers. Accordingly,
in late December, AIPC received payment from the Department of Commerce of $7.6
million as the Company's calculated share, based on tariffs liquidated by the
government from October 1, 2000 to September 30, 2001 on Italian and Turkish
imported pasta.

According to Congressional documents, these payments to affected U.S. producers
are for the purpose of maintaining jobs and investments that might

                                       8

be affected through unfair trade practices, and to offset revenues lost through
foreign companies' dumping practices and foreign governments' subsidy practices.
There are no specific requirements on how the funds are to be used by the
Company other than the funds are intended to benefit future periods. As such,
the Company used a significant portion to increase investment in long-term brand
building activities (for example, slotting to expand or recapture distribution;
cooperative advertising and consumer promotion reinforcing the long-term quality
tradition of the Company's brands), and continued strengthening of the Company's
organization.

The Company is recognizing the receipt ratably over the current fiscal year
which patterns the program year under which the payment was received.
Accordingly, during the first nine months of 2002, the Company recognized $5.7
million of retail revenue, which equals 75% of the $7.6 million payment
received. The Company expects to recognize an additional 25%, or $1.9 million,
in the last quarter of the fiscal year.

It is the Company's understanding that procedures will be established by U.S.
Customs to recover potential overpayments under this program to U.S. producers.
Overpayments may be recovered by U.S. Customs for a number of reasons up to one
year after payment is made. The Company has not received any claims of
overpayment.

At this time, indications are that the Company may receive additional payments
under this Act in subsequent years, along with others in the industry. It is not
possible to reasonably estimate the potential amount to be received in future
periods, or to state with certainty whether any payment will be received at all.


Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

The discussion set forth below, as well as other portions of this Quarterly
Report, contains statements concerning potential future events. Such
forward-looking statements are based upon assumptions by our management, as of
the date of this Quarterly Report, including assumptions about risks and
uncertainties faced by AIPC. Readers can identify these forward-looking
statements by their use of such verbs as expects, anticipates, believes or
similar verbs or conjugations of such verbs. If any management assumptions prove
incorrect or should unanticipated circumstances arise, our actual results could
materially differ from those anticipated by such forward-looking statements. The
differences could be caused by a number of factors, including but not limited
to, our dependence on a limited number of customers for a substantial portion of
our revenue, our ability to manage rapid growth, our ability to obtain necessary
raw materials and minimize fluctuations in raw material prices, the impact of
the highly competitive environment in which we operate, reliance exclusively on
a single product category, our limited experience in the branded retail pasta
business, our ability to attract and retain key personnel, our ability to
cost-effectively transport our products and the significant risks inherent in
our recent international expansion. For additional discussion of the principal
factors that could cause actual results to be materially different, refer to our
Annual Report on Form 10-K filed by the Company on December 26, 2001 with the
Securities and Exchange Commission (Commission File No. 001-13403), any
amendments thereto and other matters disclosed in the Company's other public
filings. This report has been filed with the Securities and Exchange Commission
(the "SEC" or the "Commission") in Washington, D.C. and can be obtained by
contacting the SEC's public reference operations or obtaining it through the
SEC's web site on the World Wide Web at http://www.sec.gov. Readers are strongly
encouraged to consider those factors when evaluating any such forward-looking
statement. We will not update any forward-looking statements in this Quarterly
Report to reflect future events or developments.


                                       9

Results of Operations

General

     Markets. We are the largest producer and one of the fastest-growing
marketers of dry pasta in North America. We produce and sell our pasta products
from three plants in the United States and one plant in Italy.

     Our customers are generally separated into two groups: Retail, which
includes our own product brands (e.g. Mueller's, Anthony's, Globe/A-1, Luxury,
Mrs. Grass, Pennsylvania Dutch, R & F, and Ronco), and our private label
business and comprised 73.1% and 74.4% of revenue for the three and nine month
periods ended June 30, 2002, respectively; and Institutional, which includes
ingredient, foodservice and government contracts, and comprised 26.9% and 25.6%
of revenue for the three and nine month periods ended June 30, 2002,
respectively.

     Costs. Our primary costs are durum wheat, packaging materials, labor, and
selling and marketing. Durum wheat is a cash crop, the average monthly market
price of which fluctuates. We manage our durum wheat cost risk through cost
pass-through mechanisms and other arrangements with our customers and advance
purchase contracts which are generally less than twelve months' duration. Our
labor costs remain relatively stable, but are declining as a percentage of
revenue.

     Selling and marketing costs have increased substantially over the last two
years in line with the significant expansion of our Retail business. These costs
increased 114.4% from our 1999 fiscal year through our 2001 fiscal year,
increasing from $14.9 million to $31.8 million over this three-year period, and
constituted 13.5% of revenues for the nine months ended June 30, 2002. We expect
selling and marketing expense to continue in excess of 12% of revenues for the
foreseeable future.

     Brand Acquisitions. In November 2000, we purchased the Mueller's pasta
brand from Bestfoods. In July 2001, we purchased seven pasta brands from Borden
Foods. As discussed below, the timing of these brand acquisitions had an impact
on the period-to-period comparisons.

Third quarter fiscal 2002 compared to third quarter fiscal 2001.

     Revenues. Total revenues increased $14.5 million, or 18.7%, to $91.8
million for the three-month period ended June 30, 2002, from $77.3 million for
the three-month period ended June 30, 2001. The increase for the three-month
period ended June 30, 2002 was due primarily to organic volume growth and volume
growth from acquisitions. In addition, we benefited from a U.S. government
dumping and subsidy offset payment (see Note 3 to the Consolidated Financial
Statements), with $1.9 million recorded as gross revenue in the current quarter.
There was little change to average prices during the quarter, compared to a year
ago.

     Revenues for the Retail market increased $11.9 million, or 21.6%, to $67.1
million in the current period, compared to $55.2 million for the three-month
period ended June 30, 2001. The increase primarily reflects volume growth of
20.1%, much of which came from the brand acquisitions, and Retail revenue of
$1.9 million, which represents 25% of the $7.6 million U.S. government payment
received in December 2001. (See Note 3 to the Consolidated Financial
Statements.) There was little change to average prices during the quarter,
compared to a year ago.

     Revenues for the Institutional market increased $2.6 million, or 11.5%, to
$24.7 million for the three-month period ended June 30, 2002, from $22.1

                                       10

million for the three-month period ended June 30, 2001. This increase was
primarily a result of higher volumes in all Institutional businesses.

     Gross Profit. Gross profit increased $7.2 million, or 28.5%, to $32.5
million for the three-month period ended June 30, 2002, from $25.3 million for
the three-month period ended June 30, 2001. This increase was primarily
attributable to revenue growth associated with increased volumes and the higher
per unit selling prices of our branded products. Additionally, gross margin
benefited from lower manufacturing and logistics costs. Gross profit as a
percentage of revenues increased to 35.4% for the three-month period ended June
30, 2002, from 32.7% for the three-month period ended June 30, 2001. The
increase in gross profit as a percentage of revenues relates to incremental
gross profit on branded products subsequent to the acquisitions. For the
remainder of the 2002 year, we expect year over year increases in gross profit
percentage to continue as a result of the brand acquisitions.

     Selling and Marketing Expense. Selling and marketing expense increased $3.4
million, or 46.2%, to $10.8 million for the three-month period ended June 30,
2002, from $7.4 million for the three-month period ended June 30, 2001. Selling
and marketing expense as a percentage of revenues increased to 11.8% for the
three-month period ended June 30, 2002, from 9.6% for the comparable prior year
period. This increase was primarily due to higher marketing costs associated
with higher retail revenues, as well as the incremental marketing and personnel
costs associated with our branded business. Going forward, we expect selling and
marketing expenses to exceed 12% of net revenues due to the additional
promotional expenses associated with the branded retail business.

     General and Administrative Expense. General and administrative expense
increased $0.1 million, or 2.8%, to $2.8 million for the three-month period
ended June 30, 2002, from $2.7 million for the comparable prior year period.
General and administrative expense as a percentage of revenues decreased to 3.1%
from 3.5%.

     Operating Profit. Operating profit for the three-month period ended June
30, 2002, was $18.8 million, an increase of $3.7 million or 24.5% over the $15.1
million reported for the three-month period ended June 30, 2001. Operating
profit increased as a percentage of revenues to 20.5% for the three-month period
ended June 30, 2002, from 19.6% for the three-month period ended June 30, 2001,
as a result of the factors discussed above.

     Interest Expense. Interest expense was $2.2 million for the three-month
periods ended June 30, 2002 and June 30, 2001. The effect of higher borrowings
to fund acquisitions and capital expenditures was offset by lower interest rates
in the current period.

     Income Tax. Income tax expense for the three-month period ended June 30,
2002, was $5.7 million, increasing $1.2 million from the $4.5 million reported
for the three-month period ended June 30, 2001, and reflects an effective income
tax rate of approximately 34.0% and 34.5%, respectively.

     Net Income. Net income for the three-month period ended June 30, 2002, was
$11.0 million, increasing $2.5 million or 29.6% from the $8.5 million reported
for the three-month period ended June 30, 2001. Net income as a percentage of
revenues was 12.0% compared with 11.0% for the same period of 2001. Diluted
earnings per share were $0.59 per share for the three-month period ended June
30, 2002 compared to $0.46 per share in the comparable prior year period,
representing an increase of 28.3%.


                                       11

Nine months fiscal 2002 compared to nine months fiscal 2001.

     Revenues. Revenues increased $59.9 million, or 27.4%, to $278.6 million for
the nine-month period ended June 30, 2002, from $218.7 million for the
nine-month period ended June 30, 2001. The increase for the nine-month period
ended June 30, 2002 was primarily due to higher volumes (up 22.5%) from the
brand acquisitions and organic growth (up 12.1%). In addition to volume growth,
average prices were higher primarily due to the brand acquisitions. Also
included in Retail revenue is $5.7 million, which represents 75% of the $7.6
million Department of Commerce payment received in December 2001. (See Note 3 to
the Consolidated Financial Statements.)

     Revenues for the Retail market increased $51.4 million, or 33.0%, to $207.3
million for the nine-month period ended June 30, 2002, from $155.8 million for
the nine-month period ended June 30, 2001. The increase primarily reflects
volume growth of 26.7%, much of which came from the brand acquisitions, and the
higher per unit selling prices of the acquired brands.

     Revenues for the Institutional market increased $8.5 million, or 13.5%, to
$71.4 million for the nine-month period ended June 30, 2002, from $62.9 million
for the nine-month period ended June 30, 2001. This increase was primarily due
to volume growth in the ingredient market of 12.9%, and higher average selling
prices.

     Gross Profit. Gross profit increased $31.3 million, or 46.2%, to $99.1
million for the nine-month period ended June 30, 2002, from $67.8 million for
the nine-month period ended June 30, 2001. This increase was primarily
attributable to revenue growth associated with increased volumes and the higher
per unit selling prices of our branded products. Additionally, gross margin
benefited from lower manufacturing and logistics costs. Gross profit as a
percentage of revenues increased to 35.6% for the nine-month period ended June
30, 2002 from 31.0% for the nine-month period ended June 30, 2001. The increase
in gross profit as a percentage of revenues relates primarily to incremental
gross profit on our branded products subsequent to the acquisitions. For the
remainder of the 2002 year, we expect year over year increases in gross profit
to continue as a result of our brand acquisitions.

     Selling and Marketing Expense. Selling and marketing expense increased
$17.5 million, or 87.6%, to $37.5 million for the nine-month period ended June
30, 2002, from $20.0 million for the nine-month period ended June 30, 2001.
Selling and marketing expense as a percentage of revenues was 13.5% for the
nine-month period ended June 30, 2002, up from 9.1% for the comparable prior
year period. This increase was primarily due to higher marketing costs
associated with higher retail revenues as well as incremental marketing and
personnel costs associated with our branded business. Going forward, we expect
selling and marketing expenses to exceed 12% of net revenues due to the
additional promotional support dedicated to the branded business.

     General and Administrative Expense. General and administrative expense
increased $1.5 million, or 20.3%, to $9.0 million for the nine-month period
ended June 30, 2002, from $7.5 million for the comparable prior year period.
General and administrative expense as a percentage of revenues was 3.2% for the
nine-month period ended June 30, 2002, down from 3.4% for the comparable prior
year period. The majority of the increase relates to personnel costs associated
with the brand acquisitions.

     Provision for Acquisition Related Expenses. The provision for acquisition
related expense of $1.8 million for the nine-month period ended June 30, 2001
consisted of one-time costs associated with the Mueller's acquisition.

     Operating Profit. Operating profit for the nine-month period ended June 30,
2002, was $52.6 million, an increase of $14.1 million or 36.6% over the


                                       12

$38.5 million reported for the nine-month period ended June 30, 2001, and
increased as a percentage of revenues to 18.9% for the nine-month period ended
June 30, 2002, from 17.6% for the nine-month period ended June 30, 2001 as a
result of the factors discussed above.

     Interest Expense. Interest expense for the nine-month period ended June 30,
2002, was $7.1 million, increasing $1.4 million from the $5.8 million reported
for the nine-month period ended June 30, 2001. The increase is related to
borrowings associated with the brand acquisitions and capital expenditures,
offset by lower interest rates in the current period.

     Income Tax. Income tax expense for the nine-month period ended June 30,
2002, was $15.5 million, increasing $4.2 million from the $11.3 million reported
for the nine-month period ended June 30, 2001, and reflects an effective income
tax rate of approximately 34.1% and 34.5%, respectively.

     Net Income. Net income for the nine-month period ended June 30, 2002, was
$29.9 million, increasing $8.5 million or 39.6% from the $21.4 million reported
for the nine-month period ended June 30, 2001. Diluted earnings per common share
were $1.60 per share for the nine-month period ended June 30, 2002 compared to
$1.19 per share for the nine-month period ended June 30, 2001.


Financial Condition and Liquidity

     Our primary sources of liquidity are cash provided by operations and
borrowings under our credit facility. Cash and temporary investments totaled
$9.0 million, and net working capital totaled $78.1 million at June 30, 2002.

     Our net cash provided by operating activities totaled $37.1 million for the
nine-month period ended June 30, 2002 compared to $35.2 million for the
nine-month period ended June 30, 2001. Improved operating results were offset by
increased working capital requirements, primarily related to an increase in
inventory.

     Cash used in investing activities principally relates to our investments in
manufacturing, distribution and milling assets. Capital expenditures were $51.0
million for the nine-month period ended June 30, 2002 compared to $25.3 million
in the comparable prior fiscal year period. The primary increase in such
spending for the nine-month period ended June 30, 2002 was related to
significant capital expenditures for our new Arizona manufacturing facility. The
total cost of this facility is expected to be approximately $45 million, and
completion is expected in early fiscal year 2003. In addition to the new Arizona
facility, we plan to spend approximately $5.0 million in the remainder of fiscal
year 2002, primarily for cost saving projects, maintenance projects, and
capacity expansion projects. We anticipate completion of these projects during
the year ending September 30, 2002.

     Net cash provided by financing activities was $17.6 million for the
nine-month period ended June 30, 2002 compared to net cash provided of $19.7
million for the nine-month period ended June 30, 2001. The increase is primarily
the result of borrowings to fund the new Arizona facility.

     We currently use cash from operations and borrowings to fund capital
expenditures, repayments of debt, and working capital requirements. We expect
that future cash requirements will continue to be principally for capital
expenditures, repayments of indebtedness, and working capital requirements.



                                       13

     We have current commitments for $19.3 million in raw material purchases for
fiscal year 2002 and 2003. Additionally, we have approximately $24.0 million in
expenditures remaining under the previously referenced capital programs.
Included in this total is $20.0 million for the Arizona facility, which is
expected to be spent over the remainder of 2002 and early in fiscal 2003. We
expect to fund these commitments from operations and borrowings under our credit
facility. The credit facility currently has available capacity of approximately
$69 million. At this time, the current and projected borrowings under the credit
facility do not exceed the facility's available commitment. The facility matures
on October 2, 2006. We currently have no other material commitments.

     We believe that net cash provided by operating and financing activities
will be sufficient to meet our expected capital and liquidity needs for the
foreseeable future.


Item 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         Our principal exposure to market risk associated with financial
instruments relates to interest rate risk associated with variable rate
borrowings and foreign currency exchange rate risk associated with borrowings
denominated in foreign currency. We occasionally utilize simple derivative
instruments such as interest rate swaps to manage our mix of fixed and floating
rate debt. We had various fixed interest rate swap agreements with notional
amounts of $145 million outstanding at June 30, 2002. The estimated fair value
of the interest rate swap agreements of $(1,631,000) is the amount we would be
required to pay to terminate the swap agreements at June 30, 2002. If interest
rates for our long-term debt under our credit facility had averaged 10% more and
the full amount available under our credit facility had been outstanding for the
entire year, our interest expense would have increased, and income before taxes
would have decreased by $0.5 million for the quarter ended June 30, 2002. We
hedge our net investment in our foreign subsidiaries with euro borrowings under
our credit facility. Changes in the U.S. dollar equivalent of euro-based
borrowings are recorded as a component of the net translation adjustment in the
consolidated statement of stockholders' equity.

     The functional currency for our Italy operation is the Euro. At June 30,
2002, long-term debt includes obligations of 37.5 million Euros ($35.8 million)
under a credit facility which bears interest at a variable rate based upon the
Euribor rate.

                                       14

PART II - OTHER INFORMATION

Item 1.           Legal Proceedings
- -----------------------------------
                  Not applicable

Item 2.           Changes in Securities
- ---------------------------------------
                  Not applicable

Item 3.           Defaults Upon Senior Securities
- -------------------------------------------------
                  Not applicable

Item 4.           Submission of Matters to a Vote of Security Holders
- ---------------------------------------------------------------------
                  Not applicable

Item 5.           Other Information
- -----------------------------------
                  Not applicable

Item 6.           Exhibits and Reports on Form 8-K
- --------------------------------------------------
(a)      Exhibits.

         10.  Employment Agreement with Timothy S. Webster dated May 30, 2002.

         99.  Certification pursuant to Section 906 of the Sarbanes-Oxley Act
              of 2002

(b)      Reports on Form 8-K

         None.


                                       15

SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

American Italian Pasta Company



August 5, 2002                  /s/ Timothy S. Webster
- -------------------------       --------------------------------------------
Date                             Timothy S. Webster
                                 President and Chief Executive Officer
                                 (Principal Executive Officer)



August 5, 2002                  /s/ Warren B. Schmidgall
- -----------------------         --------------------------------------------
Date                             Warren B. Schmidgall
                                 Executive Vice President and Chief
                                 Financial Officer
                                 (Principal Financial and Accounting Officer)



                                       16

                                  EXHIBIT INDEX


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

10.             Employment Agreement with Timothy S. Webster dated May 30, 2002.

99.             Certification pursuant to Section 906 of the Sarbanes-Oxley Act
                of 2002

EX-10.1

                         AMERICAN ITALIAN PASTA COMPANY
                              EMPLOYMENT AGREEMENT

                               TIMOTHY S. WEBSTER



     THIS EMPLOYMENT AGREEMENT (this "Agreement"), effective May 30, 2002 is
by and between American Italian Pasta Company ("Employer"), and Timothy S.
Webster, an individual ("Employee") (collectively "the parties") and supersedes
any and all prior oral or written agreements between the parties with respect to
the subject matter hereof.

                                   WITNESSETH:

     WHEREAS, Employer is engaged in the business of durum wheat milling and
pasta product production/marketing; and

     WHEREAS, in connection with such business, Employer desires to employ
Employee in the capacity of President and Chief Executive Officer; and

     WHEREAS, Employee desires to be employed by Employer in the aforesaid
capacities.

     NOW, THEREFORE, in consideration of the promises and mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:

     1. Term of Employment. Subject to the provisions of Section 7 hereof, the
term of Employee's employment under this Agreement (the "Employment Term") will
commence as of the date hereof (the "Effective Date") and terminate on September
30, 2005. The provisions of Sections 4, 5 and 6, below, will survive and
continue to be enforceable regardless of any termination of this Agreement.

     2. Duties of Employee.

          2.1 In accepting such employment, Employee shall undertake and assume
the responsibility of performing for and on behalf of Employer such duties as
shall be assigned to Employee by Employer at any time and from time to time and
in accordance with all of Employer's policies, practices and procedures. It is
understood and agreed that Employee's principal duties on behalf of Employer at
the date of execution hereof are and shall be to serve as President and Chief
Executive Officer and it is further understood and agreed that any modification
in or expansion of Employee's duties hereunder shall not, unless specifically
agreed to by Employee and Employer in a duly-executed amendment of this
Agreement in accordance with Section 10.6 hereof, result in any modification in
Employee's compensation referred to in Section 3 hereof.

          2.2 Employee will to the reasonable satisfaction of Employer at all
times faithfully, industriously, and to the best of Employee's ability,
experience, and talents perform

all of the duties that may be required of and from Employee pursuant to the
express and implicit terms hereof.

          2.3 Employee shall devote substantially all of Employee's professional
time, attention, knowledge, and skills solely to the business and interests of
Employer; provided, however, that Employee shall be entitled annually to five
(5) weeks vacation, and Employer shall be entitled to all of the benefits,
profits, and other issues arising from or incident to all professional work,
services, and advice of Employee.

     3. Compensation. Employer shall pay Employee, and Employee shall accept
from Employer, in payment for Employee's services rendered to Employer hereunder
an annual base salary ("Base Salary") equal to Four Hundred Sixty Thousand
Dollars ($460,000) for calendar year 2002. Base Salary shall be reviewed
annually by the Board for possible adjustment. In considering any possible
adjustment to the Base Salary, the Board will consider the reports and/or
methodology of the Hay Group or a similar consultant as reasonably selected by
the Board, with the intent that the Base Salary will be competitive with
salaries for similar executive officers at comparable companies of similar size
and scope of operations to Employer, but no less than the mid-point of the range
of salaries indicated by the consultant for such comparable executives. Such
Base Salary shall be paid in equal bi-weekly installments.

          3.1 Bonuses. During the term of this Agreement, Employee will be
eligible to participate in and bonuses may be awarded to Employee at the
discretion of the Board of Directors in accordance with the terms of Employer's
1998 Salaried Bonus Plan (the "Bonus Plan"), as the same may be amended,
modified, or terminated from time to time, and at the target levels shown on
Exhibit A, hereto.

          3.2 Reimbursement of Business Expenses. Employer agrees to reimburse
Employee for reasonable travel, entertainment, and other business expenses
incurred in the performance of Employee's duties hereunder in accordance with
Employer's policies on terms no less favorable than those policies in effect
immediately prior to the date hereof.

          3.3 Benefits. Employee shall be entitled to participate in an
equitable manner with other senior executive employees of Employer in all
welfare benefit, incentive compensation, or other plans or arrangements
authorized, adopted, and maintained from time to time by Employer, including,
without limitation, the following: automobile allowance, medical reimbursement
plan, group life insurance plan, medical and dental insurance plan, and
long-term disability income plan, if in effect with Employer.

          3.4 Benefit Schedule. As further clarification of the compensation and
benefits to be provided to Employee hereunder, Employee will receive the
benefits listed on Exhibit A attached hereto.

     4. Non-Competition.

          4.1 Employee acknowledges and recognizes the highly competitive nature
of the business of Employer and its affiliates and accordingly agrees as
follows: during the Employment Term and until the date that is twenty-four (24)
months after the date that Employee ceases employment with Employer for any
reason (such period hereinafter referred to

                                      -2-

as the "Noncompetition Period"), Employee will not, in any area in the world
where Employer conducts business, directly or indirectly own, manage, operate,
control, be employed by, consult with, or be connected in any manner with the
ownership (other than passive investments of not more than one percent of the
outstanding shares of, or any other equity interest in, any company or entity
listed or traded on a national securities exchange or in an over-the-counter
securities market), management, operation, or control of any business engaged in
the production and/or marketing of pasta products for human consumption.
Notwithstanding any provision of this Agreement to the contrary, if Employee is
employed by Employer, then any breach of the provisions of this Section 4.1
shall permit Employer to terminate the employment of Employee for Cause (as
defined below), and, whether or not Employee is employed by Employer, from and
after any breach by Employee of the provisions of this Section 4.1, then
Employer shall cease to have any obligations to make payments to Employee under
this Agreement.

          4.2 During the Noncompetition Period, Employee will not directly or
indirectly induce or attempt to induce any employee of Employer or any of its
affiliates to engage in any activity in which Employee is prohibited from
engaging by Section 4.1 hereof or to terminate Employee's or her employment with
Employer or any of its affiliates, will not directly or indirectly assist or
attempt to assist others in engaging in any of the activities in which Employee
is prohibited from engaging by Section 4.1 hereof, and will not directly or
indirectly employ or offer employment to any person who was employed by Employer
or any of its affiliates unless such person shall have ceased to be employed by
Employer or any of its affiliates for a period of at least 12 months.

          4.3 During the Noncompetition Period, Employee will not directly or
indirectly induce or attempt to induce any customer or supplier of Employer or
any of its affiliates to move, reduce or not increase its trade or business with
Employer or any of its affiliates.

          4.4 Employee acknowledges that the restrictions contained in Sections
4.1, 4.2 and 4.3 are reasonable and appropriate. However, in the event that a
court of competent jurisdiction determines that such restrictions are not
reasonable and therefore unenforceable, the parties agree that such court may
modify the restrictions in order for, but only to the least extent necessary
for, the restrictions to be enforced by such court. In the event such court
finds that any such restriction cannot be modified so as to make it enforceable,
such restriction may be deleted by such court and the enforceability of all
other restrictions will be unaffected by such deletion.

     5. Confidentiality. Employee acknowledges that, in and as a result of
Employee's employment by Employer, Employee has been and will be making use of,
acquiring, and/or adding to confidential information of a special and unique
nature and value relating to such matters as Employer's trade secrets, systems,
procedures, manuals, confidential reports, and lists of customers and/or other
services rendered by Employer, the equipment and methods used and preferred by
Employer's customers, and the prices paid by such customers. As a material
inducement to Employer to enter into this Agreement, and to pay to Employee the
compensation referred to in Section 3 hereof, Employee covenants and agrees
Employee shall not, at any time during or after the Employment Term, directly or
indirectly disclose, divulge, or use for Employee's own benefit or purposes or
the benefit or purposes of any other person, firm, partnership, joint venture,
association, corporation, or other business organization, entity, or enterprise
other than Employer and any of its subsidiaries or affiliates any trade secrets,


                                      -3-

information, data, or other confidential information relating to customers,
development programs, costs, prices, marketing, trading, investment, sales
activities, promotion, credit and financial data, manufacturing processes,
financing methods, plans, or the business and affairs of Employer generally or
of any subsidiary or affiliate of Employer, provided, however, that the
foregoing shall not apply to information that is not unique to Employer or that
is generally known to the industry or the public other than as a result of
breach of this covenant. Employee agrees that, upon termination of Employee's
employment with Employer for any reason, Employee will return to Employer
immediately all memoranda, books, manuals, training materials, records, computer
software, papers, plans, contracts, agreements, information, letters, and other
data, and all copies thereof or therefrom, in any way relating to the business
of Employer and its affiliates, except that Employee may retain personal notes,
notebooks, and diaries. Employee further agrees that Employee will not retain or
use for Employee's account at any time any trade names, trademark, or other
proprietary business designation used or owned in connection with the business
of Employer or its affiliates.

     6. Specific Performance and Survival.

          6.1 Employee acknowledges and agrees that Employer's remedies at law
for a breach or threatened breach of any of the provisions of Section 4 hereof
or Section 5 hereof would be inadequate and, in recognition of this fact,
Employee agrees that, in the event of such a breach or threatened breach, in
addition to any remedies at law, Employer, without posting any bond, shall be
entitled to obtain equitable relief in the form of specific performance,
temporary restraining order, temporary or permanent injunction, or any other
equitable remedy that may then be available.

          6.2 The parties agree that the terms of Sections 4, 5 and 6 are
independent of and separable from the other provisions of this Agreement and
that the termination of this Agreement for any reason will not affect the
continued existence and enforceability of Sections 4, 5 and 6. Those Sections
will survive and continue to be fully binding on and enforceable against
Employee and Employer after any termination of this Agreement.

     7. Termination of Employment.

          7.1 Termination without Cause; Resignation for Good Reason.

          7.1.1 General. Subject to the provisions of Sections 7.1.2 and 7.1.3
hereof, if Employee's employment is terminated by Employer without Cause, as
defined in Section 7.3, or if Employee resigns from Employee's employment for
Good Reason, as defined in Section 7.4, then Employer shall pay Employee
Employee's accrued unpaid Base Salary to the date of termination or resignation
and any bonus earned but not paid as of that date, and shall continue to pay
Employee Employee's annual Base Salary, as adjusted under Section 3, as of the
date of termination or resignation plus Employee's bonus, if any, for the year
in which such termination or resignation occurs (calculated as if the Normal
Bonus for that year is earned) for a period of twenty-four (24) months following
the date of termination or resignation (such period, as applicable, being
referred to hereinafter as the "Severance Period"). The Base Salary shall be
payable in equal bi-weekly installments during the Severance Period, and any
bonus shall be payable at the conclusion of the Severance Period. During the
Severance Period and for a period

                                      -4-

of twelve (12) months thereafter, Employee shall also be eligible to participate
on the same terms and conditions as in effect immediately prior to such
termination or resignation in all health, medical, supplemental medical, and
life insurance plans or programs provided to Employee by Employer pursuant to
Section 3.7 hereof ("Employee Welfare Plans") at the time of such termination or
resignation and which are provided by Employer to its employees following the
date of such termination or resignation; provided, however, that Employee's
eligibility to participate in these Employee Welfare Plans shall end at such
time as Employee becomes eligible to receive coverage under comparable programs
of a subsequent employer and further provided that if Employee participates in
the Employee Welfare Plans for a period of eighteen (18) months from the date of
termination or resignation, then Employee's COBRA rights shall commence at the
end of such eighteen (18) month period. If, during the Severance Period,
Employee is precluded from participating in any Employee Welfare Plan by its
terms or applicable law, then Employer will provide Employee with benefits that
are reasonably equivalent to those Employee would have received under such plan
had Employee been eligible to participate therein. Anything to the contrary
herein notwithstanding, Employer shall have no obligation to continue to
maintain any Employee Welfare Plan during the Severance Period solely as a
result of this Agreement. As an example and solely for purposes of illustration:
If Employer were to terminate its dental insurance plan prior to or during the
Severance Period, then Employer would have no obligation to maintain such plan
or provide to Employee individual dental insurance to satisfy its obligations
under this Section 7.1.1.

          7.1.2 Mitigation. Employee will not be required to mitigate the amount
of any payment provided for in Section 7.1.1 hereof by seeking other employment,
and the amount of any such payment will not be reduced by any compensation
earned by Employee as the result of Employee's employment by another employer
subsequent to termination of Employee's employment with Employer.

          7.1.3 Death During Severance Period. If Employee dies during the
Severance Period, then the Severance Period shall immediately cease, Employer
shall not be obligated to make any further payments pursuant to this Section 7,
and the provisions of Section 8.1 hereof shall apply as though Employee's death
had occurred immediately prior to termination of Employee's employment
hereunder.

          7.1.4 Date of Termination. The date of termination of employment
without Cause shall be the date specified in a written notice of termination to
Employee which in no case shall be more than 30 days following the date of
notice. The date of resignation for Good Reason shall be the date specified in
the written notice of resignation from Employee to Employer which in no case
shall be more than 30 days following the date of notice.

     7.2 Termination for Cause; Resignation Without Good Reason.

          7.2.1 General. If Employee's employment hereunder is terminated by
Employer for Cause, or if Employee resigns from Employee's employment hereunder
other than for Good Reason (a "Voluntary Termination"), then Employee shall be
entitled only to payment of Employee's Base Salary, as adjusted under Section 3,
earned through and including the date of termination or resignation. Employee
shall have no further right to receive any other

                                      -5-

compensation or to participate in any other plan, arrangement, or benefit, after
such termination for Cause or Voluntary Termination.

          7.2.2 Date of Termination. Subject to Section 7.3 hereof, the date of
termination for Cause shall be the date of receipt by Employee of notice such
termination. The date of Voluntary Termination shall be the date of receipt by
Employer of the notice of resignation.

     7.3 Cause. Terminate for "Cause" means termination of Employee's employment
because, in Employer's good faith belief, (i) Employee willfully and continually
failed substantially to perform Employee's duties under the Agreement (other
than as a result of Permanent Disability, as defined below), (ii) Employee
failed to comply with any of the material term(s) of this Agreement, including,
but not limited to, Sections 4 and 5 hereof, (iii) Employee committed an act or
acts that constituted a misdemeanor (other than a minor traffic violation) or a
felony under the law of the United States (including any subdivision thereof) or
any country to which Employee is assigned (including any subdivision thereof),
including, but not limited to, Employee's conviction for or plea of guilty or no
contest ("nolo contrendre") to any such misdemeanor or felony, (iv) Employee
committed an act or acts in violation of Employer's policies and/or practices
applicable to employees at the level of Employee within Employer's organization,
(v) Employee willfully acted, or willfully failed to act, in a manner that was
injurious to the financial condition or business reputation of Employer or any
of its subsidiaries or affiliates, (iv) Employee acted in a manner that is
unbecoming of Employee's position with Employer, regardless of whether such
action or inaction occurs in the course of the performance of Employee's duties
with Employer, or (v) Employee was subject to any fine, censure or sanction of
any kind, permanent or temporary, issued by the Securities and Exchange
Commission or the New York Stock Exchange.

     7.4 Good Reason. For purposes of this Agreement, "Good Reason" means any of
the following actions taken by Employer without Employee's prior written
consent: (i) the continued failure of Employer to pay compensation due to
Employee under this Agreement, which failure is uncorrected for a period of 15
days following receipt by Employer of written notice thereof from Employee; (ii)
a material diminution in Employee's position, authority, duties, or
responsibilities, excluding for this purpose an isolated, insubstantial, or
inadvertent action not taken in bad faith and that is remedied by Employer
promptly after receipt of written notice thereof given by Employee; provided,
however, that a mere change of Employee's title shall not constitute Good Reason
so long as Employee continues to perform duties, functions, and responsibilities
substantially equivalent to those performed by Employee prior to such change of
title; (iii) Employer's material failure or refusal to comply with the
provisions of this Agreement, which failure or refusal to comply is uncorrected
for a period of 15 days following receipt by Employer of written notice thereof
from Employee. It is expressly understood and agreed by the parties hereto that
Employer's failure to deliver a notification extending the Initial Employment
Term as referred to in Section 1 hereof shall not constitute a termination
without Cause.


                                      -6-

     8. Death or Permanent Disability.

          8.1 Death. If Employee's employment hereunder is terminated by death,
then Employer shall, within 90 days of the date of death, make a lump sum
payment to Employee's estate (or other beneficiary designated by Employee in
writing) equal to all Base Salary and bonuses, if any, earned and accrued
through the date of death. Thereafter, Employer shall have no further obligation
to Employee under the Agreement.

          8.2 Permanent Disability. If Employee becomes physically or mentally
disabled while employed by Employer under this Agreement so that Employee
is--with or without reasonable accommodation--unable to render the services
provided for by this Agreement for a period of six consecutive months or for
shorter periods aggregating six months during any 24-month period, or so that
Employee has a Disability (as defined under Employer's then-current disability
policy), then Employer may, at any time after the last day of the six
consecutive months of disability, the day on which the shorter periods of
disability equal an aggregate of six months, or the day on which Employee is
determined to have a Disability, terminate Employee's employment hereunder for
"Permanent Disability" by written notice to Employee. Following such
termination, Employee shall be entitled to receive from Employer (i) all Base
Salary and bonuses, if any, accrued through the date of termination and (ii) any
other benefits payable under Employer's then-current disability policy, but all
other rights of Employee hereunder shall terminate as of the date of Employee's
termination.

     9. Change of Control.

          9.1 Notwithstanding anything to the contrary contained herein, if
Employer terminates Employee without Cause upon or within six months following a
Change of Control (as defined below), then Employer shall pay Employee
Employee's accrued unpaid Base Salary to the date of termination and any bonus
earned but not paid and shall continue to pay Employee Employee's annual Base
Salary as of the date such termination occurs (calculated as if the Normal Bonus
for that year is earned) for a period of twenty-four (24) months following the
date of termination as severance pay (such period, as applicable, being referred
to hereinafter as the "Change of Control Severance Period"). Any severance
payable pursuant to this Section 9.1 will be in substitution for and not in
addition to any severance that might be payable pursuant to Section 7 hereof. To
the extent Employer makes payments pursuant to this Section 9.1, it will have no
additional obligations under Section 7 hereof. The Base Salary shall be payable
in bi-weekly payments during the Change of Control Severance Period, and the
bonus shall be paid at the conclusion of the Change of Control Severance Period.

          9.2 Upon a Change in Control, all options to purchase stock of
Employer held by Employee, to the extent not then exercisable, will immediately
become fully vested and exercisable and all restrictions on any stock grants
will immediately be removed.

          9.3 For purposes of this Agreement, "Change of Control" means any one
of the following:

               (a) any person or group (as defined in Section 13(d)(3) of the
          Securities Exchange Act of 1934, as amended (the "Exchange Act"))
          acquiring beneficial ownership of

                                      -7-

          more than 50% of Employer's then outstanding Common Stock or 51 % or
          more of the combined voting power of Employer's then outstanding
          securities entitled generally to vote for the election of Employer's
          Directors;

               (b) the consummation of the merger or consolidation of Employer
          with any other corporation, other than a merger with a wholly-owned
          subsidiary, the sale of substantially all of the assets of Employer,
          or the liquidation or dissolution of Employer, unless, in the case of
          a merger or consolidation, (x) the Directors in office immediately
          prior to such merger or consolidation will constitute at least
          majority of the Board of Directors of the surviving corporation of
          such merger or consolidation and any parent (as such term is defined
          in Rule 12b-2 under the Exchange Act) of such corporation, or (y) the
          voting securities of Employer outstanding immediately prior thereto
          represent (either by remaining outstanding or by being converted into
          voting securities of the surviving entity) more than 66 2/3% of the
          combined voting power of the voting securities of Employer or such
          surviving entity and are owned by all or substantially all of the
          persons who were the holders of the voting securities of Employer
          immediately prior to the transaction in substantially the same
          proportions as such holders owned such voting securities immediately
          prior to the transaction; or

               (c) Continuing Directors (as defined below) no longer constitute
          at least a majority of the Board or a similar body of any successor to
          Employer. For purposes of this Agreement, "Continuing Directors" means
          any individual who either (i) is a member of Employer's Board of
          Directors on the Effective Date, (ii) who becomes a director after the
          Effective Date whose election or nomination for election by Employer's
          shareholders, was approved by a vote of at least a majority of the
          Continuing Directors (either by a specific vote or by approval of the
          proxy statement of Employer in which such person is named as nominee
          for director, without objection to such nomination), or (iii) is
          designated by any party pursuant to its rights under Section 2.1 of
          Employer's Amended and Restated Shareholders' Agreement dated as of
          October 4, 1997, as amended.

          9.4 Excess Parachute Payments. If any payment or the receipt of
any benefit under this Agreement shall be deemed to constitute an "excess
parachute payment" as such term is described in Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"), so as to result in the loss of a
deduction to Employer under Code Section 280G or in the imposition of an excise
tax on the Employee under Code Section 4999, or any successor sections thereto,
then the amounts payable or the benefits provided under this Agreement shall be
reduced to the minimum extent necessary so that no such deduction will be lost
by Employer and no such excise tax will be imposed on the Employee. Employer, in
its sole discretion, shall determine whether or not an "excess parachute
payment" would otherwise occur and shall determine the amount and method of the
foregoing reduction.

     10. Miscellaneous.

          10.1 Assignment of Employee Benefits. Absent the prior written consent
of Employer, and subject to will and the laws of descent and distribution,
Employee shall have no right to exchange, convert, encumber, or dispose of the
rights of Employee to receive benefits and payments under this Agreement, which
payments, benefits, and rights thereto are non-assignable and non-transferable.


                                      -8-

          10.2 Burden and Benefit. This Agreement shall be binding upon,
and shall inure to the benefit of, Employer and Employee, their respective
heirs, personal, and legal representatives, successors, and assigns.

          10.3 Governing Law. In view of the fact that the principal
office of Employer is located in the State of Missouri, the parties understand
and agree that the construction and interpretation of this Agreement shall at
all times and in all respects be governed by the laws of the State of Missouri,
that the state and federal courts situated in the State of Missouri shall have
exclusive jurisdiction over any claims arising under or in relation to this
Agreement, and that the parties consent to personal jurisdiction in such state
and federal courts.

          10.4 Headings. The headings of the Sections of this Agreement
are for reference only and not to limit, expand, or otherwise affect the
contents of this Agreement.

          10.5 Entire Agreement; Modification. Except as to Employer's Stock
Option Plans, any instrument relating to an Option granted thereunder and
written agreements signed by both of the parties hereto from time to time after
the date hereof, this Agreement contains the entire agreement and understanding
by and between Employer and Employee with respect to the subject matter hereof,
and any representations, promises, agreements, or understandings, written or
oral, not herein contained shall be of no force or effect. No change, waiver, or
modification of any provision of this Agreement shall be valid or binding unless
the same is in writing and duly executed by both parties and no evidence of any
waiver or modification shall be offered or received in evidence of any
proceeding, arbitration, or litigation between the parties hereto arising out of
or affecting this Agreement, or the rights or obligations of the parties
hereunder, unless such waiver or modification is in writing, duly executed as
aforesaid, and the parties further agree that the provisions of this Section
10.6 may not be waived except as set forth herein.

          10.6 Waiver of Breach. The waiver by Employer of a breach of any
provision of this Agreement by Employee shall not operate or be construed as a
waiver of any subsequent breach by Employee.

          10.7 Notice. For the purpose of this Agreement, notices and all other
communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, addressed to the
respective addresses set forth on the execution page of this Agreement,
provided, however, that all notices to Employer shall be directed to the
attention of the Board of Directors of Employer with a copy to the Secretary of
Employer, or to such other address as either party may have furnished to the
other in writing in accordance herewith, except that notice of change of address
shall be effective only upon receipt.

          10.8 Withholding Taxes. Employer may withhold from any amounts
payable under this Agreement such federal, state, and local taxes as may be
required to be withheld pursuant to any applicable law or regulation.


                                      -9-

          10.9 Counterparts. This Agreement may be signed in counterparts, each
of which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.

     IN WITNESS WHEREOF, Employer and Employee have duly executed this Agreement
as of the day and year first hereof written.


                                  EMPLOYEE:



                                  Signature:   /s/ Timothy S. Webster
                                            ------------------------------------
                                  Printed Name:    Timothy S. Webster
                                               ---------------------------------
                                  Address:         3700 West 65th Street
                                          --------------------------------------
                                                   Mission Hills, Kansas 66208
                                          --------------------------------------



                                  AMERICAN ITALIAN PASTA COMPANY



                                  By:           /s/ Horst W. Schroeder
                                     -------------------------------------------
                                  Printed Name:     Horst W. Schroeder
                                               ---------------------------------
                                  Address:          4100 North Mulberry Drive
                                          --------------------------------------
                                                    Suite 200
                                          --------------------------------------
                                                    Kansas City MO 64116-0696
                                          --------------------------------------



                                      -10-

                                    EXHIBIT A
                                       to
                     Timothy S. Webster Employment Agreement

                               dated May 30, 2002


     1.   Normal bonus percentage - 67% of annual Base Salary.

     2.   Max bonus percentage - 100% of annual Base Salary.

     3.   One-time stock option grant of 125,000 shares vesting 31,250 shares on
          the date hereof and 31,250 shares on each of the first three
          anniversaries of the date hereof, at an exercise price per share equal
          to the closing price on the NYSE on the date hereof, and a ten year
          option life.

     4.   One-time restricted stock award of 12,000 shares with cliff vesting on
          the third anniversary of the date hereof, subject to immediate
          acceleration in full in the event of Employee's death or Disability
          (as defined in Section 8.2).

     5.   Annual allowance for personal legal and accounting fees of $25,000.

     6.   All stock options will accelerate and immediately vest in the event
          Employee terminates employment for Good Reason.


                                      -11-

EX-99

                            CERTIFICATION PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


         In connection with the Quarterly Report of American Italian Pasta
Company (the "Company") on Form 10-Q for the quarterly period ended June 28,
2002, as filed with the Securities and Exchange Commission on the date hereof
(the "Report"), the undersigned, in the capacities and dates indicated below,
hereby certify pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of
the Sarbanes-Oxley Act of 2002, that, to our knowledge: (1) The Report fully
complies with the requirements of Section 13(a) or 15(d) of the Securities
Exchange Act of 1934; and (2) The information contained in the Report fairly
presents, in all material respects, the financial condition and results of
operations of the Company.



                                 /s/  Timothy S. Webster
                                 --------------------------------------------
                                 Timothy S. Webster
                                 President and Chief Executive Officer
August 8, 2002
- --------------
Date


                                 /s/  Warren B. Schmidgall
                                 --------------------------------------------
                                 Executive Vice President and Chief
                                 Financial Officer


August 8, 2002
- --------------
Date