<PAGE>
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------------
FORM 10-Q
------------------------------
(Mark one)
[X] Quarterly Report Pursuant to Section 13 or 15 (d)
of the Securities and Exchange Act of 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1996
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 1-14020
CASTLE & COOKE, INC.
(Exact name of registrant as specified in its charter)
HAWAII 77-0412800
(State or other jurisdiction of (I.R.S. Employer
incorporation ororganization) Identification No.)
10900 WILSHIRE BOULEVARD, 16TH FLOOR
LOS ANGELES, CA 90024
(Address of principal executive offices and zip code)
(310) 208-3636
(Registrant's telephone number, including area code)
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] No [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Shares Outstanding At August 9, 1996
----- ------------------------------------
Common Stock, without par value 19,954,725 shares
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
CASTLE & COOKE, INC.
FORM 10-Q
FOR THE QUARTER ENDED
JUNE 30, 1996
TABLE OF CONTENTS
PAGE
NUMBER
------
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets -- June 30, 1996 and
December 31, 1995 . . . . . . . . . . . . . . . . . . . . . . . . .3
Consolidated Statements of Income -- quarter and half
year ended June 30, 1996 and June 30, 1995. . . . . . . . . . . . .4
Consolidated Statements of Cash Flows -- half year
ended June 30, 1996 and June 30, 1995 . . . . . . . . . . . . . . .5
Notes to Consolidated Financial Statements. . . . . . . . . . . . . .6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . .7-9
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . 10
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2
<PAGE>
CASTLE & COOKE, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
June 30, December 31,
1996 1995
(UNAUDITED) (AUDITED)
----------- -----------
Cash and cash equivalents $ 2,246 $ 4,781
Receivables, net 30,251 35,065
Real estate developments 518,137 571,828
Property, plant and equipment, net 463,555 442,162
Other assets 17,006 17,897
----------- -----------
Total assets $ 1,031,195 $ 1,071,733
----------- -----------
----------- -----------
Notes payable $ 158,145 $ 185,000
Note payable to Dole 10,000 10,000
Accounts payable 17,721 26,697
Accrued liabilities 43,505 39,917
Deferred income taxes 170,158 178,877
Deferred income and other liabilities 14,403 18,070
----------- -----------
Total liabilities 413,932 458,561
----------- -----------
Preferred stock 35,350 35,000
Common shareholders' equity
Common stock 511,000 510,953
Retained earnings 70,913 67,219
----------- -----------
Total common shareholders' equity 581,913 578,172
----------- -----------
Total liabilities and shareholders' equity $ 1,031,195 $ 1,071,733
----------- -----------
----------- -----------
The accompanying notes are an integral part
of these consolidated balance sheets.
3
<PAGE>
CASTLE & COOKE, INC.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(IN THOUSANDS, EXCEPT EARNINGS PER COMMON SHARE AMOUNTS)
<TABLE>
<CAPTION>
Quarter Ended Half Year Ended
---------------------------- ----------------------------
Predecessor Predecessor
(Dole) (Dole)
June 30, June 30, June 30, June 30,
1996 1995 1996 1995
------------ -------------- ------------- -------------
<S> <C> <C> <C> <C>
REVENUES
Residential property sales $ 57,096 $ 60,898 $ 103,229 $ 120,353
Resort revenues 11,169 11,257 30,488 23,952
Commercial and other revenues 12,370 12,566 23,976 22,080
--------- --------- --------- ---------
Total revenues 80,635 84,721 157,693 166,385
COST OF OPERATIONS
Cost of residential property sales 47,854 48,191 88,921 99,976
Cost of resort operations 15,771 18,170 36,160 37,104
Cost of commercial and other operations 8,383 8,209 16,120 15,101
General and administrative expenses 3,262 3,938 6,482 6,299
--------- --------- --------- ---------
Total cost of operations 75,270 78,508 147,683 158,480
--------- --------- --------- ---------
Operating income 5,365 6,213 10,010 7,905
Interest and other income, net 424 739 1,211 1,388
Interest expense 643 - 1,632 -
--------- --------- --------- ---------
Income before income taxes 5,146 6,952 9,589 9,293
Provision for income taxes 2,033 2,850 3,788 3,810
--------- --------- --------- ---------
Net income 3,113 4,102 5,801 5,483
Preferred stock dividend and accretion (1,047) - (2,107) -
--------- --------- --------- ---------
Net income available to common shareholders $ 2,066 $ 4,102 $ 3,694 $ 5,483
--------- --------- --------- ---------
Earnings per common share $ 0.10 $ 0.21 $ 0.19 $ 0.27
--------- --------- --------- ---------
--------- --------- --------- ---------
Average number of common shares outstanding
for 1996 and proforma for 1995 19,955 19,952 19,953 19,952
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>
The accompanying notes are an integral part
of these consolidated financial statements.
4
<PAGE>
CASTLE & COOKE, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(IN THOUSANDS)
Half Year Ended
------------------------
Predecessor
(Dole)
June 30, June 30,
1996 1995
---------- ----------
Operating activities
Net income $ 5,801 $ 5,483
Adjustments to reconcile net income to cash flow
used in operating activities
Depreciation and amortization 8,813 12,814
(Decrease) increase in deferred income taxes (8,719) 3,810
Decrease (increase) in receivables, net 4,814 (6,861)
Decrease in real estate developments 33,809 4,549
Decrease in accounts payable (8,976) (11,793)
Increase (decrease) in accrued liabilities 2,949 (4,694)
Net change in other assets and liabilities (2,776) 600
---------- ----------
Cash flow provided by operating activities 35,715 3,908
---------- ----------
Investing activities
Acquisition of property, plant and equipment (10,324) (6,530)
---------- ----------
Cash flow used in investing activities (10,324) (6,530)
---------- ----------
Financing activities
Net reductions under revolving loan agreement (26,855) -
Proceeds from exercise of stock options 47 -
Preferred stock dividends paid (1,118) -
Contribution from Dole, net - 3,350
---------- ----------
Cash flow used in financing activities (27,926) 3,350
---------- ----------
Decrease in cash and cash equivalents (2,535) 728
Cash and cash equivalents at beginning of period 4,781 1,404
---------- ----------
Cash and cash equivalents at end of period $ 2,246 $ 2,132
---------- ----------
---------- ----------
SUPPLEMENTAL CASH FLOW DATA
- ---------------------------
Cash paid during the first quarter for:
Interest paid $ 5,869 $ -
Income taxes paid 12,507 -
The accompanying notes are an integral part
of these consolidated financial statements.
5
<PAGE>
CASTLE & COOKE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. BASIS OF PRESENTATION
The consolidated financial statements included herein have been prepared by
Castle & Cooke, Inc. ("the Company"), without audit, and include all
adjustments which are, in the opinion of management, necessary for a fair
presentation of the results of operations for the quarters and half years
ended June 30, 1996 and June 30, 1995, respectively, pursuant to the rules
and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations, although the Company believes that the disclosures in such
financial statements are adequate to make the information presented not
misleading. The consolidated financial statements should be read in
conjunction with the Company's financial statements and the notes thereto for
the year ended December 31, 1995, included in the Company's Annual Report on
Form 10-K filed with the Securities and Exchange Commission.
The Company was formed on October 10, 1995 to be the successor of the assets
and related liabilities of the real estate and resorts business of Dole Food
Company, Inc. and its subsidiaries ("Dole"). On December 28, 1995, Dole
completed the separation of its real estate and resorts business from its
food business through a pro rata distribution of the stock of the Company to
its shareholders.
The consolidated statements of income and cash flows contained herein for
periods prior to December 28, 1995 are those of Dole and have been prepared
on the basis that the assets and liabilities of the real estate and resorts
business were transferred using historical carrying values as recorded by
Dole and present the Company's results of operations and cash flows as
derived from Dole's historical financial statements.
The Company's operating results are subject to significant variability as a
result of, among other things, the receipt of regulatory approvals, status of
development in particular projects and the timing of sales in developed
projects. The results of operations for the quarter ended June 30, 1996, are
not necessarily indicative of the results to be expected for the full year.
Operating results for 1995 have been restated to reflect results from January 1,
1995 to June 30, 1995. Results were previously reported for the former parent's
fiscal quarter ending June 17, 1995.
NOTE 2. COMMITMENTS AND CONTINGENCIES
The Company and its subsidiaries are contingently liable as joint indemnitors to
surety companies for subdivision, off-site improvement and construction bonds
issued on their behalf.
The Company is a defendant in several lawsuits arising in the normal course of
business. In the opinion of management, the final resolution of these lawsuits
will not have a material adverse effect on its financial position or results of
operations.
NOTE 3. SUBSEQUENT EVENTS
On July 25, 1996, the Company completed the sale of three apartment complexes
in Mississippi for approximately $32 million. The sale will provide
approximately $4 million in operating income in the third quarter of 1996 and
the net proceeds of $31.1 million will initially be used to reduce borrowings
on the revolving credit facility.
6
<PAGE>
CASTLE & COOKE, INC.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
REVENUES
Second quarter consolidated revenues decreased from $84.7 million in 1995 to
$80.6 million in 1996, and first half consolidated revenues decreased from
$166.4 million in 1995 to $157.7 million in 1996. Second quarter residential
property sales decreased 25% from $60.9 million in 1995 to $45.9 million in
1996, excluding the sale of approximately 3,000 acres of agricultural land in
Bakersfield for $11.2 million in 1996. First half residential property sales
decreased 13% from $105.4 million in 1995 to $92.0 million in 1996, excluding
the agricultural land sale in 1996 and the apartment complex sale in
Bakersfield for $15.0 million in the first quarter of 1995. The decreases in
the residential property sales are primarily due to a decrease in both
deliveries and the average price per homes sold. Total deliveries in the
second quarter of 1996 included 155 homes compared to 203 homes in the
comparable period of 1995. Total deliveries for the first half year of 1996
included 296 homes compared to 348 homes in the comparable period of 1995.
The average price per home in the second quarter of 1996 was $254,000
compared to $263,000 in the comparable period of 1995. The average price per
home in the first half year of 1996 was $266,000 compared to $270,000 in the
comparable period of 1995. The decrease in both deliveries and the average
price per homes sold was primarily due to a soft residential market in Oahu.
First half resort revenues increased 27% to $30.5 million in 1996 from $24.0
million in 1995. This increase was primarily due to improved occupancy and
room rates at the resorts and the sale of four luxury villas at Koele for
$3.4 million.
COST AND EXPENSES
Second quarter consolidated cost of operations decreased from $78.5 million
in 1995 to $75.3 million in 1996, and first half consolidated cost of
operations decreased from $158.5 million in 1995 to $147.7 million 1996. The
cost of residential property sales as a percentage of residential property
sales increased from 79% in the second quarter of 1995 to 84% in 1996,
excluding the 3,000 acre agricultural land sale in 1996. The agricultural
land sale generated approximately $1.9 million in operating income. The cost
of residential property sales as a percentage of residential property sales
increased from 81% in the first half of 1995 to 87% in 1996, excluding the
agricultural land sale in 1996 and the apartment complex sale in 1995. This
increase is primarily due to aggressive marketing programs and sales
incentives used in the Oahu operations which have been necessary to stimulate
activity in the soft market. Second quarter cost of resort operations
decreased from $18.2 million to $15.8 million in 1996 primarily due to a $2.0
million reduction in depreciation that resulted from the $168 million
writedown of long-lived assets recorded in the third quarter of 1995. First
half cost of resort operations decreased from $37.1 million in 1995 to $36.2
million in 1996 primarily due to a $4.2 million reduction in depreciation
partially offset by the cost related to increased occupancy at the hotels and
the sale of four luxury villas at Koele. The cost of resort operations as a
percentage of resort revenues improved from 161% in the second quarter of
1995 to 141% in 1996 and from 155% in the first half of 1995 to 119% in 1996
primarily due to the decrease in depreciation expense. Depreciation for
resorts in the second quarter and first half year was $2.2 million and $4.3
million in 1996, respectively, and $4.1 million and $8.6 million in 1995,
respectively. In addition, a significant portion of the resort operation's
costs are fixed and, accordingly, do not increase proportionately as
occupancy and resort revenues increase.
7
<PAGE>
CASTLE & COOKE, INC.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
COST AND EXPENSES (CONTINUED)
Consolidated general and administrative costs increased from $6.3 million in
1995 to $6.5 million primarily due to increased corporate expenses in 1996 which
were previously absorbed by the Company's former parent in 1995 and to
additional corporate costs incurred as a separate, publicly held company in
1996, partially offset by decreased overhead at the Oahu and resort operations.
Total interest incurred in the second quarter and the first half of 1996 was
$3.1 million and $6.7 million, respectively. Total interest capitalized into
real estate development in the second quarter and first half year of 1996 was
$2.5 million and $5.1 million, respectively. The increase in interest expense
is due to the debt incurred in connection with the Company's separation from its
former parent in December of 1995.
NET INCOME AND EARNINGS PER SHARE
Second quarter net income available to common shareholders decreased 50% from
$4.1 million in 1995 to $2.1 million in 1996, and first half net income
available to common shareholders decreased 33% from $5.5 million in 1995 to
$3.7 million in 1996. The decreases were primarily due to decreased revenue
combined with the charge related to the 10% cumulative preferred stock
dividend and accretion, partially offset by a reduced operating loss from the
resort operations. The dividend relates to the $35 million cumulative
preferred stock issued in connection with the Company's separation from its
former parent in December of 1995.
The Company's effective income tax rate decreased to 39.5% in 1996 from 41% in
1995. This decrease is due to a lower effective tax rate subsequent to the
Company's separation from its former parent in December of 1995.
BACKLOG
The Company's new orders and backlog for homes for 1996 compared to 1995 were as
follows:
<TABLE>
<CAPTION>
Quarter Ended Half Year Ended
-------------------------- ---------------------------
June 30, June 30, June 30, June 30,
1996 1995 1996 1995
------------ ---------- ------------ ------------
<S> <C> <C> <C> <C>
Units
Backlog at beginning of the period 193 182 133 207
Add: new orders 83 192 284 312
Less: deliveries 155 203 296 348
---------- ---------- ---------- ----------
Backlog at end of the period 121 171 121 171
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Dollars
Backlog at beginning of the period $ 48,572 $ 55,824 $ 34,298 $ 61,203
Add: new orders 24,583 50,801 78,138 85,809
Less: deliveries 39,354 53,432 78,635 93,819
---------- ---------- ---------- ----------
Backlog at end of the period $ 33,801 $ 53,193 $ 33,801 $ 53,193
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
</TABLE>
The decrease in new orders and deliveries in 1996 is primarily due to a soft
residential housing market in Oahu.
8
<PAGE>
CASTLE & COOKE, INC.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
The Company requires capital to operate its resorts, purchase and develop land,
construct homes and homesites and to acquire, develop and operate commercial
property.
In connection with the separation from its former parent company in December
of 1995, the Company entered into a Credit Agreement with a syndicate of
banks pursuant to which the banks agreed to provide the Company a three year
revolving Credit Facility of up to $240 million until March of 1997 at which
time the Credit Facility will be reduced to $140 million. In the second
quarter of 1996, the Company voluntarily reduced the available amount of the
revolving Credit Facility to $190 million in order to benefit from a lower
effective interest rate. The Credit Facility bears interest at a variable
rate based on the London Interbank Offered Rate ("LIBOR") or at an
alternative rate based upon a designated Bank's prime rate or the federal
funds rate. At June 30, 1996, total borrowings under this facility were $158
million and the weighted average interest rate was 7.2%.
During the quarter ended June 30, 1996, the Company generated $35.7 million
in cash flow from operating activities, as compared to the corresponding
period in 1995 during which the Company generated $3.9 million. The increase
is primarily due to the timing of development expenditures at the Hawaii
residential operations and resort operations and the sale of 3,000 acres of
agricultural land in Bakersfield for $11.2 million.
The Company believes that funds available under the revolving Credit Facility
and cash generated from operations combined with selective sales of
commercial and other properties from time to time will be adequate for its
short-term and long-term cash needs. There can be no assurance, however,
that the amounts available from such sources will be sufficient. The Company
may be required to seek additional capital in the form of public equity or
debt offerings or from a variety of potential sources, including additional
bank financing.
9
<PAGE>
CASTLE & COOKE, INC.
PART II.
OTHER INFORMATION
JUNE 30, 1996
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
EXHIBIT
NO.
-------
3.3 By-Laws, as amended
10.6 The Company's Deferred Stock Compensation Plan For Non-Employee
Directors, as amended
27 Financial Data Schedule
(b) Reports on Form 8-K
THE REGISTRANT FILED NO REPORTS ON FORM 8-K DURING THE QUARTER ENDED
JUNE 30, 1996.
All other items required under Part II are omitted because they are not
applicable.
10
<PAGE>
CASTLE & COOKE, INC.
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.
CASTLE & COOKE, INC.
Registrant
Date: August 9, 1996 BY EDWARD C. ROOHAN
---------------------
Edward C. Roohan
Vice President and
Chief Financial Officer
(Principal financial officer
and accounting officer)
11
<PAGE>
BYLAWS
(Amended through May 13, 1996)
OF
CASTLE & COOKE, INC.
ARTICLE I
OFFICES AND SEAL
SECTION 1.01. PRINCIPAL OFFICE. The principal office of the
corporation shall be located at 10900 Wilshire Boulevard, Los Angeles,
California 90024. In addition to its principal office at Los Angeles aforesaid,
the corporation may maintain offices in such other place or places within or
without the State of Hawaii as may be from time to time designated by the Board
of Directors.
SECTION 1.02. CORPORATE SEAL. The corporation may have a corporate
seal in such form as may be determined by the board of directors.
ARTICLE II
SHAREHOLDERS' MEETINGS
SECTION 2.01. ANNUAL MEETING. Unless dispensed with by unanimous
written consent of shareholders in accordance with law and with Section 2.05 of
these Bylaws, the annual meeting of the shareholders shall be held at such place
and at such time as the President shall designate and if the President shall
fail to designate such date, then the annual meeting for that year shall be held
at such place and on such date as shall be fixed by the Board of Directors. At
the annual meeting the shareholders shall elect the directors to hold office
until the next annual meeting and thereafter until their successors shall be
duly elected and qualified and, subject to any requirements of law or of the
Articles of Incorporation or of these Bylaws with respect to notice, may
transact any other business which may be brought before the meeting and take any
other corporate action.
SECTION 2.02. SPECIAL MEETINGS. Special meetings of the shareholders
shall be called by the Secretary upon written request of the President, any
director of the corporation, or the holders of not less than one-tenth (1/10th)
of all the shares entitled to vote at the meeting, or upon the resolution of the
Board of Directors. At any special meeting such business shall be brought
before the shareholders and may be transacted as shall have been specified in
the notice of such meeting, but any other business may be transacted subject to
any requirements of law or of the Articles of Incorporation or of these Bylaws
with respect to notice. Special meetings of shareholders shall be held at such
place and at such times as shall be fixed by the Board of Directors.
SECTION 2.03. QUORUM. A majority of the shares entitled to vote,
represented in person or by proxy, shall
<PAGE>
constitute a quorum for the transaction of business at any meeting of the
shareholders. If a quorum is present, the affirmative vote of the majority of
the shares represented at the meeting and entitled to vote on the subject matter
shall be the act of the shareholders and shall be valid and binding upon the
corporation, except as otherwise specifically provided by law, the Articles of
Incorporation, or these Bylaws. Each shareholder entitled to vote at any
meeting of the shareholders shall be entitled to one vote in person or by proxy
for each share registered in the name of such shareholder on the books of the
corporation.
SECTION 2.04. NOTICE OF MEETINGS. Written notice specifying the
place, day and hour of each shareholders' meeting, whether annual or special,
and if a special meeting the purpose or purposes for which the meeting is
called, shall be delivered not less than ten nor more than seventy days before
the date of the meeting, either personally or by mail, by or at the direction of
the President, the Secretary, or the officer or persons calling the meeting, to
each shareholder of record entitled to vote at such meeting. If mailed, such
notice shall be deemed to be delivered when deposited in the United States mail
addressed to the shareholder at the shareholder's address as it appears on the
stock transfer books of the corporation, with postage thereon prepaid. If
notice is given as aforesaid, non-receipt of such notice by any shareholder
shall not invalidate any business done at any meeting, either annual or special,
at which a quorum is present. The presence of any shareholder at any meeting
shall constitute a waiver of the requirement of giving of notice of said meeting
to such shareholder, except where a shareholder attends a meeting for the
express purpose of objecting to the transaction of any business because the
meeting is not lawfully called or convened. Any shareholder may, prior to, at
the meeting, or subsequent thereto, waive notice of any meeting in writing
signed by such shareholder or a duly authorized attorney-in-fact thereof.
SECTION 2.05. ACTION WITHOUT MEETING. Any action required or
permitted to be taken at a meeting of the shareholders may be taken without a
meeting if a consent in writing, setting forth the action so taken, shall be
signed by all of the shareholders entitled to vote with respect to the subject
matter thereof. Such consent shall have the same effect as a unanimous vote of
shareholders.
SECTION 2.06. VOTING RECORD. The Treasurer, or such other officer or
agent of the corporation having charge of the stock transfer books of the
corporation, shall make a complete record of the shareholders entitled to vote
at any shareholders' meeting, whether annual or special, or any adjournment
thereof. Such record shall be arranged in alphabetical order, with the address
of and the number of shares held by each shareholder, and shall be produced and
kept open at the time and place of the meeting and shall be subject to the
inspection of any shareholder
<PAGE>
during the whole time of the meeting for the purposes thereof. Failure to
comply with the requirements of this Section 2.06 shall not affect the validity
of any action taken at such meeting.
SECTION 2.07. PROXIES. At any meeting of the shareholders, a
shareholder may vote in person or by proxy executed in writing by the
shareholder or by his duly authorized attorney-in-fact. Such proxy shall be
filed with the Secretary of the corporation before or at the time of the
meeting. No proxy shall be valid after eleven months from the date of its
execution, unless otherwise provided in the proxy.
ARTICLE III
DIRECTORS
SECTION 3.01. NUMBER AND QUALIFICATIONS. The initial Board of
Directors shall be composed of three (3) members. Before the annual meeting of
shareholders to be held in 1997, the directors are authorized to increase the
number of directors to seven (7) and to appoint directors to fill the vacancies
created by such increase in the size of the Board. Thereafter, the directors
shall be elected by the shareholders at their annual meeting. Each director
shall hold office until the next annual meeting and thereafter until the
successor of such director is duly elected or appointed and qualified, subject,
however, to removal by the shareholders.
SECTION 3.02. QUORUM. A majority of the number of directors fixed in
accordance with Section 3.01 of these Bylaws shall constitute a quorum for the
transaction of business at any meeting of the Board of Directors. The act of
the majority of the directors present at a meeting at which a quorum is present
shall be the act of the Board of Directors.
SECTION 3.03. VACANCIES. In case of any vacancy or vacancies in the
Board of Directors, the remaining directors (although less than a quorum) may
fill the same by the affirmative vote of a majority of the remaining directors.
The director elected to fill such vacancy shall be elected for the unexpired
term of such director's predecessor in office. The determination by the Board
of Directors, as shown in the minutes, of the fact of any vacancy shall be
conclusive as to all persons and the corporation.
SECTION 3.04. REGULAR MEETINGS. The Board of Directors shall hold a
meeting immediately following the annual meeting of the shareholders. No notice
of such meeting need be given. Other regular meetings of the Board of Directors
may be held at such times as the business of the corporation shall require
according to resolutions of the Board of Directors. No notice of regular
meetings of the Board of Directors shall be required.
<PAGE>
SECTION 3.05. SPECIAL MEETINGS. Special meetings of the Board of
Directors may be called by resolutions of the Board of Directors or upon the
call of the President or any director. Such special meetings shall be held at
such place and at such time as shall be fixed by the person or one of the
persons so authorized and calling such special meeting.
SECTION 3.06. NOTICE. Notice of the time and place of any meeting of
the Board of Directors for which notice is required shall be given to each
director by the Secretary or by the person or one of the persons calling the
meeting, not less than twenty-four hours before the date set for the meeting, by
advising each director by telephone, by word of mouth, or by leaving written
notice of such meeting with each director or at the residence or usual place of
business of each director, or by facsimile transmission, or by sending written
notice of such meeting by first-class mail, postage prepaid, not less than three
nor more than fifteen days before the meeting, to each director at such
director's last known address as it appears on the records of the corporation.
Non-receipt of any such notice shall not invalidate any business done at any
meeting at which a quorum is present. The presence of any director at any
meeting shall constitute a waiver of the requirement of giving of notice of said
meeting to such director, except where a director attends a meeting for the
express purpose of objecting to the transaction of any business because the
meeting is not lawfully called or convened. Any director or directors, whether
attending a meeting or not, may, prior to, at the meeting, or subsequent
thereto, waive notice of the meeting by written waiver signed by such director
or directors.
SECTION 3.07. TELEPHONE MEETINGS. Subject to the notice requirements
in Section 3.06 of these Bylaws, members of the Board of Directors or any
committee designated thereby may participate in a meeting of the Board of
Directors or of such committee by means of a conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other at the same time. Participation by such means shall
constitute presence in person at a meeting.
SECTION 3.08. ACTION WITHOUT MEETING. Any action required or
permitted to be taken at any meeting of the Board of Directors or any committee
designated thereby may be taken without a meeting if all the directors or all of
the members of the committee, as the case may be, sign a written consent setting
forth the action taken or to be taken at any time before or after the intended
effective date of such action. Such consent shall be filed with the minutes of
the Board of Directors or committee, as the case may be, and shall have the same
effect as a unanimous vote.
SECTION 3.09. REMOVAL OF DIRECTORS AND FILLING OF VACANCIES.
<PAGE>
(a) At a meeting of shareholders called expressly for that
purpose, any director or the entire Board of Directors may be removed, with or
without cause, by the affirmative vote of the holders of a majority of the
shares then entitled to vote at an election of directors.
(b) The shareholders of the corporation may, at any special
meeting called for that purpose, decrease the number of directors and fill any
vacancies which may then exist in the Board of Directors, whether caused by
resignations, removals or otherwise, including temporary vacancies. No decrease
in the number of directors shall have the effect of shortening the term of any
incumbent director.
SECTION 3.10. POWERS OF DIRECTORS. Subject to any limitations
provided by law or set forth in the Articles of Incorporation or in these
Bylaws, the Board of Directors shall have full power to control and direct the
business and affairs of the corporation and to exercise all the powers and
perform all the acts which the corporation may legally exercise and perform.
SECTION 3.11. PRESUMPTION OF ASSENT. A director present at a meeting
of the Board of Directors at which action on any corporate matter is taken shall
be presumed to have assented to the action taken unless such director's dissent
shall be entered in the minutes of the meeting or unless such director shall
file a written dissent to such action with the secretary of the meeting before
the adjournment thereof or shall forward such dissent by registered mail to the
secretary of the corporation immediately after the adjournment of the meeting.
Such right to dissent shall not apply to a director who voted in favor of such
action.
SECTION 3.12. EXECUTIVE AND OTHER COMMITTEES. The Board of
Directors, by resolution adopted by a majority of the full Board of Directors,
may designate from among its members an executive committee and one or more
other committees each of which, to the extent provided in such resolution, shall
have and may exercise all the authority of the Board of Directors, except as
limited by law, the Articles of Incorporation, or these Bylaws.
SECTION 3.13. NOMINATION OF DIRECTOR CANDIDATES. Nominations of
candidates for election to the Board of Directors of the corporation at any
meeting of the shareholders called for election of directors (an "Election
Meeting") may be made by the Board of Directors or by any shareholder entitled
to vote at such Election Meeting.
Nominations made by the Board of Directors shall be made at a meeting
of the Board of Directors, or by written consent of directors in lieu of a
meeting, not less than 30 days prior to the date of the Election Meeting. At
the request of the
<PAGE>
secretary of the corporation, each person so nominated by the Board of Directors
shall provide the corporation with such information concerning himself as is
required, under the rules of the Securities and Exchange Commission, to be
included in the corporation's proxy statement soliciting proxies for his
election as a director.
Not less than 30 days prior to the date of an Election Meeting, any
shareholder who intends to make a nomination of a candidate for election to the
Board of Directors of the corporation at such Election Meeting shall deliver a
notice to the secretary of the corporation setting forth (i) the name, age,
business address and residence address of each such intended nominee, (ii) the
principal occupation or employment of each such intended nominee, (iii) the
number of shares of capital stock of the corporation which are beneficially
owned by each such intended nominee, and (iv) such other information concerning
each such intended nominee as would be required, under the rules of the
Securities and Exchange Commission, in a proxy statement soliciting proxies for
the election of each such nominee.
In the event that a person is validly designated as a nominee in
accordance with the procedures specified above and shall thereafter become
unable or unwilling to stand for election to the Board of Directors, the Board
of Directors or the shareholder who proposed such nominee, as the case may be,
may designate a substitute nominee.
If the chairman of the Election Meeting determines that a nomination
was not made in accordance with the foregoing procedures, such nomination shall
be void.
<PAGE>
ARTICLE IV
OFFICERS
SECTION 4.01. GENERALLY. The officers of the corporation shall
consist of a Chief Executive Officer/President, one or more Vice Presidents, a
Treasurer and a Secretary and, at the discretion of the Board of Directors, a
Chairman of the Board. Any two or more offices may be held by the same
individual; provided that if there are two or more directors there shall be at
least two individuals as officers. The officers shall be appointed annually by
the Board of Directors at its first meeting after the annual or special meeting
of the shareholders at which the Board of Directors is elected and shall hold
office until the next annual meeting and thereafter until their successors shall
be duly appointed and qualified, subject, however, to removal by the Board of
Directors. The number of Vice Presidents may be changed from time to time by
the Board of Directors at any meeting or meetings thereof and, if increased at
any time, the additional Vice President or Vice Presidents shall be appointed by
the Board of Directors. There may also be one or more Assistant Vice
Presidents, Assistant Treasurers, Assistant Secretaries, and other subordinate
officers who shall be appointed by the Board of Directors and the number thereof
shall be determined from time to time by the Board of Directors.
SECTION 4.02. VACANCIES. Vacancies which may occur in any office
shall be filled by appointment by the Board of Directors for the remainder of
the term of such office.
SECTION 4.03. REMOVALS. Any officer or agent may be removed by the
Board of Directors whenever in its judgment the best interests of the
corporation will be served thereby, but such removal shall be without prejudice
to the contract rights, if any, of the person so removed. Election or
appointment of an officer or agent shall not of itself create such contract
rights.
SECTION 4.04. CHAIRMAN OF THE BOARD. The Chairman shall preside at
all meetings of the shareholders and Board of Directors at which the Chairman is
present, and shall perform such other duties and have such other powers as the
Board of Directors may prescribe.
SECTION 4.05. CHIEF EXECUTIVE OFFICER/PRESIDENT. The President shall
preside at all meetings of the Board of Directors and of the shareholders at
which the Chairman is absent. Subject to the control of the Board of Directors,
the President shall have general charge and care of the business and property of
the corporation, shall appoint and discharge employees and agents of the
corporation and determine their compensation, shall vote the stock of other
companies which is owned by the corporation and shall do and perform such
additional duties as may be prescribed by the Board of Directors. When
authorized by the Board of Directors so to do, the President may delegate to one
of the Vice Presidents the whole or any part of the general management and
<PAGE>
care of the business and property of the corporation, including the employment
and discharge of agents and employees.
SECTION 4.06. VICE PRESIDENTS. It shall be the duty of the Vice
Presidents to assume and perform the duties of the President in the absence or
disability of the President or whenever the office of President is vacant. Each
Vice President shall do and perform such additional duties as may be prescribed
by the Board of Directors.
SECTION 4.07. TREASURER. The Treasurer shall be the financial and
accounting officer of the corporation. The Treasurer shall have custody of all
moneys, valuable papers and documents of the corporation, shall keep the same
for safekeeping in such depositories as may be designated by the Board of
Directors and shall expend the funds of the corporation as directed by the Board
of Directors. The Treasurer shall register and transfer stock of the
corporation under such regulations as may be prescribed by the Board of
Directors. The Treasurer shall keep or cause to be kept a book or books setting
forth a true record of the receipts and expenditures, assets and liabilities,
losses and gains of the corporation and shall, when and as required by the Board
of Directors, render a statement of the financial condition of the corporation.
If required to do so by the Board of Directors, the Treasurer shall give a bond
in such amount and with such surety as may be prescribed by the Board of
Directors for the faithful discharge of the duties of the office. The Treasurer
shall also do and perform such additional duties as may be prescribed by the
Board of Directors. In the absence or disability of the Treasurer, the duties
of the office shall be performed by the Secretary or by an Assistant Treasurer.
SECTION 4.08. SECRETARY. The Secretary shall be ex officio secretary
of the Board of Directors, shall give or cause to be given all required notices
of meetings of the shareholders and the Board of Directors, shall record the
proceedings of meetings of the shareholders and the Board of Directors in a book
or books to be kept for that purpose, and shall perform such other duties as may
be assigned from time to time by the Board of Directors and by the President.
The Secretary shall have custody of the seal of the corporation, if there is
one. In the absence or disability of the Secretary, the duties of the office
shall be performed by the Treasurer or by an Assistant Secretary.
SECTION 4.09. SUBORDINATE OFFICERS. The powers and duties of the
subordinate officers shall be as prescribed by the Board of Directors. In the
absence or disability of the Treasurer and Secretary, the Assistant Treasurer or
the Assistant Secretary may register and transfer stock of the corporation under
such regulations as may be prescribed by the Board of Directors.
ARTICLE V
EXECUTION OF INSTRUMENTS
<PAGE>
SECTION 5.01. INSTRUMENTS IN GENERAL. All checks, dividend warrants,
and other orders for the payment of money, drafts, notes, bonds, acceptances,
contracts, deeds, leases, mortgages, agreements of sale, bills of lading, and
all other instruments except as otherwise provided in these Bylaws, shall be
signed by such person or persons as shall be provided by general or special
resolution of the Board of Directors. In the absence of any such general or
special resolution applicable to any instrument, such instrument shall be signed
by the President or any Vice President and by the Treasurer or the Secretary or
the Assistant Treasurer or the Assistant Secretary.
SECTION 5.02. FACSIMILE SIGNATURES. The Board of Directors may
provide for the execution of checks, stock certificates and other written
instruments by the printed, lithographed or engraved facsimile signature or
signatures of the person or persons authorized by the Board of Directors to sign
such instruments.
SECTION 5.03. SEAL. If the corporation has a seal, any officer or
subordinate officer of the corporation, and any other person authorized to do so
by the Board of Directors, may affix the seal of the corporation to any
instrument and may attest the same.
ARTICLE VI
CAPITAL STOCK
SECTION 6.01. SHARES REPRESENTED BY CERTIFICATES. Except in the case
of uncertificated shares, the President shall issue or cause to be issued to
each shareholder a certificate or certificates signed by the Chairman of the
Board, a Vice Chairman of the Board, the President, or a Vice President, and
countersigned by the Treasurer, the Secretary, an Assistant Treasurer, or an
Assistant Secretary, with the seal of the corporation (or a facsimile thereof)
thereto affixed, if the corporation has a seal. Each such certificate shall
state on its face that the corporation is organized under the laws of the State
of Hawaii, the name of the person to whom issued, the number and class, and
series if any within a class, of the shares of the stock of the corporation
represented by such certificate, the par value of each share represented by such
certificate or a statement that the shares are without par value, and such other
information as may be required by law. No certificate shall be issued for any
share unless the consideration established for its issuance shall have been
paid.
SECTION 6.02. UNCERTIFICATED SHARES. The Board of Directors may
provide by resolution that some or all of any or all classes and series of the
shares of the corporation shall be uncertificated shares, provided that such
resolution shall not apply to shares represented by a certificate until such
certificate is surrendered to the corporation. Within a reasonable time after
issuance or transfer of uncertificated
<PAGE>
shares, the corporation shall send to the registered owner thereof a written
notice containing the information required by law to be set forth or stated in
certificates.
SECTION 6.03. TRANSFERS. Shares of the corporation shall be
transferable only upon its books by the holder or holders thereof in person, or
by the authorized attorney or legal representative of such holder or holders.
If the shares transferred are represented by certificates, the holder or holders
thereof or the authorized attorney or legal representative of such holder or
holders shall, at the time of transfer, surrender to the corporation, duly
endorsed, the old certificate or certificates and receive new certificates in
exchange therefor. Each transfer shall be recorded and the original record or
duplicate thereof shall be kept at an office of the corporation.
SECTION 6.04. CLOSING OF TRANSFER BOOKS AND RECORD DATE.
(a) For the purpose of determining shareholders entitled to
notice of or to vote at any meeting of shareholders or any adjournment thereof,
or entitled to receive payment of any dividend, or in order to make a
determination of shareholders for any other proper purpose, the Board of
Directors may provide that the stock transfer books shall be closed for a stated
period but not to exceed, in any case, seventy days. If the stock transfer
books shall be closed for the purpose of determining shareholders entitled to
notice of or to vote at a meeting of shareholders, such books shall be closed
for at least ten days immediately preceding such meeting.
(b) In lieu of closing the stock transfer books, the Board of
Directors may fix in advance a date as the record date for any such
determination of shareholders, such date in any case to be not more than seventy
days and, in case of a meeting of shareholders, not less than ten days prior to
the date on which the particular action, requiring such determination of
shareholders, is to be taken.
(c) If the stock transfer books are not closed and no record
date is fixed for the determination of shareholders entitled to notice of or to
vote at a meeting of shareholders, or shareholders entitled to receive payment
of a dividend, the date on which notice of the meeting is mailed or the date on
which the resolution of the Board of Directors declaring such dividend is
adopted, as the case may be, shall be the record date for such determination of
shareholders. When a determination of shareholders entitled to vote at any
meeting of shareholders has been made as provided in this section, such
determination shall apply to any adjournment thereof.
ARTICLE VII
DIRECTOR CONFLICTS OF INTEREST
<PAGE>
SECTION 7.01. GENERALLY. No contract or other transaction between
this corporation and one or more of its directors or any other corporation,
firm, association, or entity in which one or more of its directors are directors
or officers or are financially interested, shall be either void or voidable
because of such relationship or interest or because such director or directors
are present at the meeting of the Board of Directors or a committee thereof
which authorizes, approves, or ratifies such contract or transaction or because
the vote or votes of such director or directors are counted for such purpose,
if:
(a) The fact of such relationship or interest is disclosed or known
to the Board of Directors or committee which authorizes, approves, or ratifies
the contract or transaction by a vote or consent sufficient for the purpose
without counting the votes or consents of such interested directors; or
(b) The fact of such relationship or interest is disclosed or known
to the shareholders entitled to vote and they authorize, approve, or ratify such
contract or transaction by vote or written consent; or
(c) The contract or transaction is fair and reasonable to this
corporation.
SECTION 7.02. QUORUM. Common or interested directors may be counted
in determining the presence of a quorum at a meeting of the Board of Directors
or a committee thereof which authorizes, approves, or ratifies such contract or
transaction.
SECTION 7.03. NO LIABILITY. Neither any director or officer of the
corporation, being so interested in any contract, transaction or act of the
corporation which is not void or voidable pursuant to this Article VII, nor any
other corporation, firm, association, or entity in which such director or
officer is a director or officer or is financially interested shall be liable or
accountable to the corporation, or to any shareholder thereof, for any loss
incurred by the corporation pursuant to or by reason of such contract,
transaction or act, or for any gain received by any such other party pursuant
thereto or by reason thereof.
ARTICLE VIII
GENERAL PROVISIONS
SECTION 8.01. ADJOURNMENT. Whenever at any meeting provided for in
these Bylaws less than a quorum shall be present or represented, such meeting
may thereupon be adjourned without notice from time to time by a majority vote
of those present or represented until a quorum shall be present or represented.
Any meeting at which a quorum is present or represented may be adjourned in the
same manner for such time as may be fixed by a majority vote at such meeting.
Whenever a quorum is present at
<PAGE>
any adjourned meeting, any business may be transacted which could have been done
at the meeting originally called.
SECTION 8.02. FISCAL YEAR. The fiscal year of the corporation shall
be as determined from time to time by the Board of Directors.
SECTION 8.03. APPROVAL OF ACTS OF BOARD OF DIRECTORS. At any annual
or special meeting of the shareholders, any or all of the acts of the Board of
Directors may be submitted for ratification and approval and may be ratified or
approved by the shareholders. Such ratification or approval shall be as valid
and binding upon the corporation and upon all the shareholders as though it had
been approved or ratified by every shareholder of the corporation.
ARTICLE IX
AMENDMENTS
These Bylaws may be amended, altered, or repealed and new Bylaws may
be adopted by the affirmative vote of a majority of the members of the Board of
Directors of the corporation, subject to repeal or change by action of the
shareholders.
<PAGE>
CASTLE & COOKE, INC.
DEFERRED STOCK COMPENSATION PLAN
FOR NON-EMPLOYEE DIRECTORS
(as amended through July 2, 1996)
<PAGE>
CASTLE & COOKE, INC.
DEFERRED STOCK COMPENSATION PLAN
FOR NON-EMPLOYEE DIRECTORS
(AS AMENDED THROUGH JULY 2, 1996)
TABLE OF CONTENTS
Page
----
ARTICLE I TITLE, PURPOSE AND AUTHORIZED SHARES. . . . . . . . . . . . . 1
ARTICLE II DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE III PARTICIPATION . . . . . . . . . . . . . . . . . . . . . . . . 4
ARTICLE IV DEFERRAL ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . 4
4.1 Stock Unit Account . . . . . . . . . . . . . . . . . . . 4
4.2 Dividend Equivalents; Dividend
Equivalent Stock Account . . . . . . . . . . . . . . . . 4
4.3 Vesting of Stock Unit Account and
Dividend Equivalent Stock Account. . . . . . . . . . . . 5
4.4 Distribution of Benefits . . . . . . . . . . . . . . . . 5
4.5 Adjustments in Case of Changes
in Common Stock. . . . . . . . . . . . . . . . . . . . . 6
4.6 Corporation's Right to Withhold. . . . . . . . . . . . . 6
4.7 Limitations on Rights Associated
with Units . . . . . . . . . . . . . . . . . . . . . . . 7
4.8 Restrictions on Resale . . . . . . . . . . . . . . . . . 7
ARTICLE V ADMINISTRATION. . . . . . . . . . . . . . . . . . . . . . . . 7
5.1 Formula Plan . . . . . . . . . . . . . . . . . . . . . . 7
5.2 Decisions Final; Delegation; Reliance;
and Limitation on Liability. . . . . . . . . . . . . . . 7
ARTICLE VI PLAN CHANGES AND TERMINATION. . . . . . . . . . . . . . . . . 8
6.1 Amendments . . . . . . . . . . . . . . . . . . . . . . . 8
6.2 Term . . . . . . . . . . . .. . . . . . . . . . . . . . . 8
6.3 Distribution of Shares . . . . . . . . . . . . . . . . . 8
<PAGE>
ARTICLE VII MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . 9
7.1 Limitation on Directors' Rights. . . . . . . . . . . . . 9
7.2 Beneficiaries. . . . . . . . . . . . . . . . . . . . . . 9
7.3 Benefits Not Assignable; Obligations
Binding Upon Successors. . . . . . . . . . . . . . . . . 9
7.4 Governing Law; Severability. . . . . . . . . . . . . . . 9
7.5 Compliance With Laws . . . . . . . . . . . . . . . . . . 10
7.6 Plan Construction. . . . . . . . . . . . . . . . . . . . 10
7.7 Headings Not Part of Plan. . . . . . . . . . . . . . . . 10
7.8 Shareholder Approval; Effective Date . . . . . . . . . . 10
7.9 Irrevocability of Payout Elections . . . . . . . . . . . 10
<PAGE>
CASTLE & COOKE, INC.
DEFERRED STOCK COMPENSATION PLAN
FOR NON-EMPLOYEE DIRECTORS
(AS AMENDED THROUGH JULY 2, 1996)
ARTICLE I
TITLE, PURPOSE AND AUTHORIZED SHARES
This Plan shall be known as "Castle & Cooke, Inc. Deferred Stock
Compensation Plan For Non-Employee Directors" and shall become effective as
provided in Section 7.8. The purpose of this Plan is to compensate directors in
a manner that further aligns their economic interest with the interests of
shareholders generally and by so doing further attract, motivate and retain
experienced and knowledgeable directors of the Corporation. The total number of
shares of Common Stock that may be delivered pursuant to awards under this Plan
is 50,000, subject to adjustments contemplated by Section 4.5.
ARTICLE II
DEFINITIONS
Whenever the following terms are used in this Plan they shall have the
meaning specified below unless the context clearly indicates to the contrary:
ACCOUNTS means a Director's Stock Unit Account and Dividend
Equivalent Stock Account.
AVERAGE FAIR MARKET VALUE means the average of the Fair Market
Values of a share of Common Stock of the Corporation during the last 10 trading
days preceding the applicable date of determination.
AWARD means the crediting of a Unit or Units under this Plan.
AWARD DATE means June 1 of each year, commencing in 1996.
BENEFICIARY shall have the meaning specified in Section 7.2(b).
BOARD OF DIRECTORS or BOARD means the Board of Directors of the
Corporation.
1
<PAGE>
CHANGE IN CONTROL EVENT means and shall be deemed to have
occurred upon:
(1) Approval by the shareholders of the Corporation of the
dissolution or liquidation of the Corporation;
(2) Approval by the shareholders of the Corporation of an
agreement to merge or consolidate, or otherwise reorganize, with or into
one or more entities that are not subsidiaries or other affiliates, as a
result of which less than 50% of the outstanding voting securities of the
surviving or resulting entity immediately after the reorganization are, or
will be, owned, directly or indirectly, by shareholders of the Corporation
immediately before such reorganization (assuming for purposes of such
determination that there is no change in the record ownership of the
Corporation's securities from the record date for such approval until such
reorganization and that such record owners hold no securities of the other
parties to such reorganization, but including in such determination any
securities of the other parties to such reorganization held by affiliates
of the Corporation);
(3) Approval by the shareholders of the Corporation of the sale
of substantially all of the Corporation's business and/or assets to a
person or entity which is not a subsidiary or other affiliate; or
(4) Any "person" (as such term is used in Sections 13(d) and
14(d) of the Exchange Act but excluding any person described in and
satisfying the conditions of Rule 13d-1(b)(1) thereunder), other than a
person who is the beneficial owner (as defined in Rule 13d-3 under the
Exchange Act) of more than 20% of the outstanding shares of Common Stock at
the time of adoption of this Plan (or an affiliate, successor, heir,
descendent or related party of or to any such person), becomes the
beneficial owner (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Corporation representing more
than 50% of the combined voting power of the Corporation's then outstanding
securities entitled to then vote generally in the election of directors of
the Corporation.
CODE means the Internal Revenue Code of 1986, as amended.
COMMON STOCK means shares of Common Stock of the Corporation,
subject to adjustments made under Section 4.5 or by operation of law.
2
<PAGE>
CORPORATION means Castle & Cooke, Inc., a Hawaii corporation, and
its successors and assigns.
DIRECTOR means a member of the Board of Directors of the
Corporation who is eligible to receive compensation in the form of retainer
fees for services in such capacity and who is not an officer or employee of
the Corporation or any of its subsidiaries.
DISABILITY means a "permanent and total disability" within the
meaning of Section 22(e)(3) of the Code.
DISTRIBUTION means the initial distribution of the shares of
Common Stock of the Corporation by Dole Food Company, Inc. to its
shareholders.
DIVIDEND EQUIVALENT means the amount of dividends or other
distributions paid by the Corporation on that number of shares of Common
Stock equivalent to the number of Stock Units then credited to a Director's
Stock Unit Account and Dividend Equivalent Stock Account, which amount
shall be allocated as additional Stock Units to the Director's Dividend
Equivalent Stock Account.
DIVIDEND EQUIVALENT STOCK ACCOUNT means the bookkeeping account
maintained by the Corporation on behalf of a Director which is credited
with Dividend Equivalents in the form of Stock Units in accordance with
Section 4.2.
EFFECTIVE DATE means the effective date referred to in
Section 7.8.
EXCHANGE ACT means the Securities Exchange Act of 1934, as
amended from time to time.
FAIR MARKET VALUE means the closing price of the Stock as
reported on the composite tape of New York Stock Exchange issues (or, if
the Stock is not so listed or if the principal market on which it is traded
is not the New York Stock Exchange, such other reporting system as shall be
selected by the Board) on the relevant date, or, if no sale of the Stock is
reported for that date, the next preceding day for which there is a
reported sale.
PLAN means the Castle & Cooke, Inc. Deferred Stock Compensation
Plan For Non-Employee Directors.
STOCK means Common Stock.
STOCK UNIT OR UNIT means a non-voting unit of measurement that is
deemed for bookkeeping purposes to be equiva-
3
<PAGE>
lent to an outstanding share of Common Stock of the Corporation and
includes fractional units.
STOCK UNIT ACCOUNT means the bookkeeping account maintained by
the Corporation on behalf of each Director which is credited with Stock
Units in accordance with Section 4.1.
ARTICLE III
PARTICIPATION
Each Director shall become a participant in the Plan upon a crediting event
under Article IV.
ARTICLE IV
DEFERRAL ACCOUNTS
4.1. STOCK UNIT ACCOUNT.
The Stock Unit Account of each Director shall be credited on each Award
Date with a number of Units determined by dividing $10,000 by the Average Fair
Market Value of the Common Stock on the Award Date. A Director who is not
serving as a director on an Award Date is not eligible for any portion of the
Award for the applicable year.
4.2. DIVIDEND EQUIVALENTS; DIVIDEND EQUIVALENT STOCK ACCOUNT.
(a) ALLOCATION OF DIVIDEND EQUIVALENTS. Each Director shall be entitled to
receive Dividend Equivalents on the Units credited to his or her Stock Unit
Account and Dividend Equivalent Stock Account, whether before or after a
termination of service, which Dividend Equivalents shall be credited to the
Director's Dividend Equivalent Stock Account in accordance with Section
4.2(b) below.
(b) DIVIDEND EQUIVALENT STOCK ACCOUNT. The Director's Dividend Equivalent
Stock Account shall be credited with an additional number of Units determined by
dividing the amount of Dividend Equivalents by the Fair Market Value of a share
of Common Stock as of each dividend payment date. The Units credited to a
Director's Dividend Equivalent Stock Account shall be allocated (for purposes of
distribution) in accordance with Section 4.4(b) and shall be subject to
adjustment in accordance with Section 4.5.
4
<PAGE>
4.3. VESTING OF STOCK UNIT ACCOUNT AND DIVIDEND EQUIVALENT STOCK ACCOUNT.
The rights of each Director in respect of his or her Stock Unit Account and
related Dividend Equivalent Stock Account shall vest immediately on crediting.
4.4. DISTRIBUTION OF BENEFITS.
(a) COMMENCEMENT OF BENEFITS DISTRIBUTION. Subject to the terms of this
Section 4.4 and Section 4.5, each Director shall be entitled to receive a
distribution in a number of shares of Stock equal to the number of Units in his
or her Accounts upon a termination of service (including but not limited to a
retirement or resignation) as a Director of the Corporation.
(b) MANNER OF DISTRIBUTION. The benefits payable under this Plan shall be
distributed to the Director (or, in the event of his or her death, the
Director's Beneficiary) in a lump sum, unless the Director elects in writing (on
forms provided by the Corporation) by the time specified in Section 4.4(f), to
receive a distribution of his or her benefits in respect of such Units in
approximately equal annual installments (before giving effect to post-
termination crediting of additional Dividend Equivalents before the applicable
payment date) for up to five years thereafter. Elections with respect to any
Units in the Stock Unit Account shall apply to all Dividend Equivalent Units
attributable to those Stock Units, and to all Dividend Equivalent Units
attributable to those Dividend Equivalent Units. Installment payments shall
commence as of the date benefits become distributable under Section 4.4(a).
Notwithstanding the foregoing, if the vested balance remaining in a Director's
Stock Unit Account and Dividend Equivalent Stock Account is less than
1,000 shares, then the remaining balance shall be distributed in shares in a
lump sum. No fractional interests shall be distributed, but they may be
accumulated and paid in cash.
(c) EFFECT OF DEATH OR DISABILITY; CHANGE IN CONTROL. Notwithstanding
Sections 4.4(a) and (b), if a Director or former Director dies or suffers a
Disability resulting in or following a termination of service, the distribution
in Stock of the Director's Accounts (or remaining Accounts, as the case may be)
shall be made immediately in a lump sum. If the Director's service terminates
upon or after a Change in Control Event, or a former Director has any remaining
Accounts at the time of such Change in Control Event, the distribution in Stock
of the Director's Accounts (or remaining Accounts, as the case may be) shall be
made immediately in a lump sum.
(d) FORM OF DISTRIBUTION. Stock Units credited to a Director's Stock Unit
Account and Dividend Equivalent Stock Account shall be paid and distributed by
means of a distribution of an
5
<PAGE>
equivalent whole number of shares of the Common Stock. Fractions shall be
accumulated and converted to Units, but any fractional interest in a Unit shall
be paid in cash on final distribution.
(e) SUB-ACCOUNTS. The Administrator shall retain sub-accounts of a
Director's Accounts as may be necessary to determine which Units are subject to
any distribution elections under Section 4.4(b).
(f) TIMING OF ELECTIONS. A Director may elect (with respect to Units
credited on any June 1 and any related Dividend Equivalent Units) an installment
distribution as provided in Section 4.4(b) within 60 days following the annual
crediting of the Units to his or her Stock Unit Account; provided, however, that
no such election shall be effective until 12 months after the election is filed
with the Corporation. If a director has made such an election, it shall be
deemed a continuing one as to Units to be credited in future years, unless
(subject to Sections 7.6 and 7.9) the Director notifies the Corporation to the
contrary at least 60 days after the applicable June 1st on which the additional
Units are credited.
4.5. ADJUSTMENTS IN CASE OF CHANGES IN COMMON STOCK. If there shall
occur any recapitalization, stock split (including a stock split in the form of
a stock dividend), reverse stock split, merger, combination, consolidation, or
other reorganization or any extraordinary non-cash dividend or other
extraordinary distribution in respect of the Stock (whether in the form of
Stock, other securities, or other property), or any split-up, spin-off,
extraordinary redemption, or exchange of outstanding Stock, or there shall occur
any other similar corporate transaction or event in respect of the Stock, or a
sale of substantially all the assets of the Corporation as an entirety,
proportionate and equitable adjustments consistent with the effect of such event
on shareholders generally (but without duplication of benefits if Dividend
Equivalents are credited) shall be made in the number and type of shares of
Common Stock or other consideration (including cash, property or securities in
respect thereof) reserved and to be distributed, and of Units, under this Plan.
4.6. CORPORATION'S RIGHT TO WITHHOLD. The Corporation shall satisfy state
or federal income tax withholding obligations, if any, arising upon distribution
of a Director's accounts by reducing the number of shares of Common Stock
otherwise deliverable to the Director by the appropriate number of shares (based
on the Average Fair Market Value) required to satisfy such tax withholding
obligation. If the Corporation, for any reason, cannot satisfy the withholding
obligation in accordance with the preceding sentence, the Director shall pay or
provide for payment in cash of the amount of any taxes which the Corporation may
be required to withhold with respect to the benefits hereunder.
6
<PAGE>
4.7. LIMITATIONS ON RIGHTS ASSOCIATED WITH UNITS. A Director's Accounts
shall be memorandum accounts on the books of the Corporation. The Units
credited to a Director's Accounts shall be used solely as a device for the
determination of the number of shares of Common Stock to be eventually
distributed to such Director in accordance with this Plan. The Units shall not
be treated as property or as a trust fund of any kind, although the Corporation
shall reserve shares to satisfy its obligations under this Plan. Each
Director's rights in the Units is limited to the right to receive shares of
Common Stock (or other consideration) in the future as herein provided. No
Director shall be entitled to any voting or other shareholder rights with
respect to Units granted under this Plan. The number of Units credited under
this Section shall be subject to adjustment in accordance with Section 4.5.
4.8. RESTRICTIONS ON RESALE. Stock distributed in respect of those Stock
Units that were first credited under Section 4.1 within six months of the
distribution (and Dividend Equivalent Account Units credited under Section 4.2
solely in respect thereof) may be legended or otherwise restricted so as to
prevent a sale of the Stock within six months of the initial crediting of those
Stock Units. Installments shall be deemed payable and paid in the order (i.e.,
last-in, last-out) of the accrual of the underlying Units.
ARTICLE V
ADMINISTRATION
5.1. FORMULA PLAN. This Plan shall be, to the maximum extent possible,
self-effectuating. This Plan shall be construed, interpreted and, to the extent
required, administered by the Board or a committee duly appointed and authorized
by the Board to act on its behalf under this Plan. To the extent required by
Section 7.6, the Board (or such committee) shall have no discretionary authority
with respect to the amount, price or timing of any Award granted under this
Plan. No director shall participate in any decision relating solely to his or
her benefits. Subject to the terms of this Plan, the Board (or such committee)
may resolve any questions and make all other determinations and adjustments
required by this Plan, maintain all the necessary records for the administration
of this Plan, and provide forms and procedures to facilitate the implementation
of this Plan.
5.2. DECISIONS FINAL; DELEGATION; RELIANCE; AND LIMITATION ON LIABILITY.
Any determination of the Board or a duly authorized committee of the Board made
in good faith shall be conclusive. In performing its duties, the Board or the
committee shall be entitled to rely on public records and on information,
7
<PAGE>
opinions, reports or statements prepared or presented by officers or employees
of the Corporation or other experts believed to be reliable and competent. The
Board or the committee may delegate ministerial, bookkeeping and other non-
discretionary functions to individuals who are officers or employees of the
Corporation.
Neither the Corporation nor any member of the Board, nor any other person
participating in any determination of any question under this Plan, or in the
interpretation, administration or application of this Plan, shall have any
liability to any party for any action taken or not taken in good faith under
this Plan or for the failure of an Award (or action or payment in respect of an
Award) to satisfy Code requirements for realization of intended tax
consequences, to qualify for exemption or relief under Rule 16b-3 under the
Exchange Act, or to comply with any other law, compliance with which is not
required on the part of the Corporation.
ARTICLE VI
PLAN CHANGES AND TERMINATION
6.1. AMENDMENTS. The Board of Directors shall have the right to amend
this Plan in whole or in part from time to time or may at any time suspend or
terminate this Plan; provided, however, that no amendment or termination shall
cancel or otherwise adversely affect in any way, without his or her written
consent, any Director's rights with respect to Stock Units and Dividend
Equivalents credited to his or her Stock Unit Account or Dividend Equivalent
Stock Account. Notwithstanding the preceding, the provisions of this Plan that
determine the amount, price or timing of benefits related to Stock Units or
Dividend Equivalents shall not be amended more than once every six months (other
than as may be necessary to conform to any applicable changes in the Code or the
rules thereunder), unless such amendment would be consistent with the provisions
of Rule 16b-3 (or any successor provision) under the Exchange Act ("Rule 16b-
3").
6.2. TERM. This Plan shall continue for a period of 10 years following
the date of its approval by the Board, but continuance of this Plan is not
assumed as a contractual obligation of the Corporation. In the event that the
Board of Directors decides to terminate this Plan, it shall notify the Directors
of its action in an instrument in writing, and this Plan shall be terminated at
the time therein set forth, and all Directors shall be bound thereby.
6.3. DISTRIBUTION OF SHARES. If this Plan terminates pursuant to
Section 6.2, the distribution of the Accounts of a Director shall be made at the
time provided in Section 4.4(a) and in a manner consistent with the elections
made pursuant to Section 4.4(b).
8
<PAGE>
ARTICLE VII
MISCELLANEOUS
7.1. LIMITATION ON DIRECTORS' RIGHTS. Participation in this Plan shall
not give any Director the right to continue to serve as a member of the Board or
any rights or interests other than as herein provided. No Director shall have
any right to any payment or benefit hereunder except to the extent provided in
this Plan. This Plan shall create only a contractual obligation on the part of
the Corporation as to such amounts and shall not be construed as creating a
trust. This Plan, in and of itself, has no assets. Directors shall have only
the rights of general unsecured creditors of the Corporation with respect to
amounts credited or vested and benefits payable, if any, on their Accounts.
7.2. BENEFICIARIES.
(a) BENEFICIARY DESIGNATION. Upon forms provided and in accordance with
procedures established by the Corporation, each Director may designate in
writing (and change a designation of) the Beneficiary or Beneficiaries (as
defined in Section 7.3(b)) that the Director chooses to receive the Common Stock
payable under this Plan after his or her death, subject to applicable laws
(including any applicable community property and probate laws).
(b) DEFINITION OF BENEFICIARY. A Director's "Beneficiary" or
"Beneficiaries" shall be the person or persons, including a trust or trusts,
validly designated by the Director or, in the absence of a valid designation,
entitled by will or the laws of descent and distribution to receive the
Director's benefits under this Plan in the event of the Director's death.
7.3. BENEFITS NOT ASSIGNABLE; OBLIGATIONS BINDING UPON SUCCESSORS.
Benefits of a Director under this Plan shall not be assignable or transferable
and any purported transfer, assignment, pledge or other encumbrance or
attachment of any payments or benefits under this Plan, or any interest therein,
other than pursuant to Section 7.2, shall not be permitted or recognized.
Obligations of the Corporation under this Plan shall be binding upon successors
of the Corporation.
7.4. GOVERNING LAW; SEVERABILITY. The validity of this Plan or any of its
provisions shall be construed, administered and governed in all respects under
and by the laws of the State of California. If any provisions of this
instrument shall be held by a court of competent jurisdiction to be invalid or
unenforceable, the remaining provisions hereof shall continue to be fully
effective.
9
<PAGE>
7.5. COMPLIANCE WITH LAWS. This Plan and the offer, issuance and delivery
of shares of Common Stock and/or the payment and deferral of compensation under
this Plan are subject to compliance with all applicable federal and state laws,
rules and regulations (including but not limited to state and federal reporting,
registration, insider trading and other securities laws) and to such approvals
by any listing agency or any regulatory or governmental authority as may, in the
opinion of counsel for the Corporation, be necessary or advisable in connection
therewith. Any securities delivered under this Plan shall be subject to such
restrictions, and the person acquiring the securities shall, if requested by the
Corporation, provide such assurances and representations to the Corporation as
the Corporation may deem necessary or desirable to assure compliance with all
applicable legal requirements.
7.6. PLAN CONSTRUCTION. It is the intent of the Corporation that this
Plan satisfy and be interpreted in a manner that satisfies any applicable
requirements of Rule 16b-3 so that Directors will remain "disinterested" to the
extent required by Rule 16b-3 for purposes of administering other stock plans of
the Corporation and will be entitled to the benefits of Rule 16b-3 or other
exemptive rules under Section 16 of the Exchange Act and will not be subjected
to avoidable liability thereunder. Any contrary interpretation shall be
avoided.
7.7. HEADINGS NOT PART OF PLAN. Headings and subheadings in this Plan are
inserted for reference only and are not to be considered in the construction of
this Plan.
7.8. SHAREHOLDER APPROVAL; EFFECTIVE DATE. This Plan has been approved by
the Board of Directors and was approved by Dole Food Company, Inc. as the sole
shareholder of the Corporation.
7.9 IRREVOCABILITY OF PAYOUT ELECTIONS. Subject to Sections 7.5 and 7.6,
a Director may, subject to the approval of the Committee, prospectively change a
distribution election under Section 4.4(b) by a subsequent election that will
take effect at least 12 months after the subsequent election is received by the
Company if, in the opinion of Counsel to the Company, the subsequent election
would not adversely affect the disinterested administration of other plans of
the Company or the availability to other Directors of any exemption under Rule
16b-3 under the Exchange Act or the efficacy of deferrals under the Code in
respect of other Participants in this Plan. The Committee may, subject to
Sections 7.5 and 7.6, permit an election by a Director that would not qualify
for an exemption under Section 16(b) of the Exchange Act, so long as the
disinterested administration of other stock plans of the Company for purposes of
Rule 16b-3, and the availability of any exemption thereunder for other directors
under this Plan, is not compromised.
10
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEETS AND CONSOLIDATED STATEMENTS OF INCOME FOUND ON PAGES
3 AND 4 OF THE COMPANY'S FORM 10-Q FOR THE YEAR-TO-DATE, AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0001002506
<NAME> CASTLE & COOK, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 2,246
<SECURITIES> 0
<RECEIVABLES> 30,251
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 463,555
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,031,195
<CURRENT-LIABILITIES> 0
<BONDS> 0
35,350
0
<COMMON> 511,000
<OTHER-SE> 70,913
<TOTAL-LIABILITY-AND-EQUITY> 1,031,195
<SALES> 157,693
<TOTAL-REVENUES> 157,693
<CGS> 141,201
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,632
<INCOME-PRETAX> 9,589
<INCOME-TAX> 3,788
<INCOME-CONTINUING> 5,801
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,801
<EPS-PRIMARY> .19
<EPS-DILUTED> 0
</TABLE>
