<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant /X/
Filed by a party other than the Registrant / /
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or 240.14a-12
CASTLE & COOKE, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
<PAGE>
<TABLE>
<S> <C>
CASTLE & COOKE, INC.
10900 Wilshire Boulevard
Los Angeles, CA 90024
April 10, 1997
</TABLE>
To the Stockholders of Castle & Cooke, Inc.:
You are cordially invited to attend the Annual Meeting of Stockholders of
Castle & Cooke, Inc. (the "Company") which will be held at the Beverly Hilton
Hotel, 9876 Wilshire Boulevard, Beverly Hills, California at 10:00 a.m. on May
21, 1997.
This booklet includes the Notice of Annual Meeting and the Proxy Statement,
which contain information about the formal business to be acted on at the
meeting by the stockholders. The meeting will also feature a report on the
operations of your Company, followed by a question and discussion period.
We hope that you will be able to attend the meeting. If so, please let us
know by checking the box on the form of proxy. However, whether or not you plan
to attend in person, please complete, sign, date and return the enclosed proxy
card(s) promptly to ensure that your shares will be represented. If you do
attend the meeting and wish to vote your shares personally, you may revoke your
proxy.
Thank you for your continued interest in Castle & Cooke, Inc.
<TABLE>
<S> <C>
Sincerely yours,
/S/ DAVID H. MURDOCK
David H. Murdock
Chairman of the Board and
Chief Executive Officer
</TABLE>
<PAGE>
CASTLE & COOKE, INC.
10900 WILSHIRE BOULEVARD
LOS ANGELES, CALIFORNIA 90024
------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 21, 1997
------------------------
The Annual Meeting of Stockholders of CASTLE & COOKE, INC. (the "Company")
will be held at the Beverly Hilton Hotel, 9876 Wilshire Boulevard, Beverly
Hills, California at 10:00 a.m. on May 21, 1997 for the following purposes:
1. To elect seven (7) directors of the Company, each to serve until the next
Annual Meeting of Stockholders and until his or her successor has been duly
elected and qualified;
2. To elect Arthur Andersen LLP as the Company's independent public accountants
and auditors for the 1997 fiscal year; and
3. To transact such other business as may properly come before the meeting or
any adjournments thereof.
The Board of Directors has fixed April 2, 1997 as the record date for the
determination of stockholders entitled to notice of and to vote at the Annual
Meeting. Accordingly, only stockholders of record at the close of business on
that date are entitled to vote at the Annual Meeting or any adjournments
thereof.
<TABLE>
<S> <C>
By Order of the Board of Directors,
[SIGNATURE]
Roberta Wieman
CORPORATE SECRETARY
</TABLE>
April 10, 1997
IMPORTANT: IF YOU CANNOT BE PRESENT AND DESIRE TO HAVE YOUR STOCK VOTED AT THE
ANNUAL MEETING, PLEASE COMPLETE, SIGN AND DATE THE ENCLOSED PROXY CARD(S) AS
PROMPTLY AS POSSIBLE AND RETURN IT (THEM) IN THE ENCLOSED PRE-ADDRESSED
ENVELOPE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES. IF YOU
RECEIVE MORE THAN ONE PROXY CARD BECAUSE YOU OWN SHARES REGISTERED IN DIFFERENT
NAMES OR AT DIFFERENT ADDRESSES, EACH PROXY CARD SHOULD BE COMPLETED AND
RETURNED.
<PAGE>
CASTLE & COOKE, INC.
10900 WILSHIRE BOULEVARD
LOS ANGELES, CALIFORNIA 90024
------------------------
PROXY STATEMENT
---------------------
This Proxy Statement is furnished to stockholders by the Board of Directors
of Castle & Cooke, Inc. (the "Company") in connection with the solicitation of
proxies for use at the Annual Meeting of Stockholders of the Company to be held
at the Beverly Hilton Hotel, 9876 Wilshire Boulevard, Beverly Hills, California
at 10:00 a.m. on May 21, 1997, and at any adjournments thereof. The Company's
principal executive offices are located at 10900 Wilshire Boulevard, Los
Angeles, California, and its telephone number is (310) 208-3636.
This Proxy Statement, Notice of Annual Meeting and the accompanying proxy
card(s) are being first mailed to stockholders on or about April 14, 1997. The
Company's 1996 Annual Report is being mailed to stockholders with this Proxy
Statement. The Annual Report is not to be regarded as proxy soliciting material
or as a communication by means of which any solicitation of proxies by the
Company is to be made.
GENERAL INFORMATION, VOTING RIGHTS AND PROCEDURES
The Board of Directors has fixed April 2, 1997 as the record date (the
"Record Date") for the determination of stockholders entitled to notice of and
to vote at the Annual Meeting or any adjournments thereof. On the Record Date,
19,957,084 shares of Common Stock of the Company ("Common Stock") were
outstanding and entitled to vote at the meeting. The Common Stock is the only
class of stock of the Company that is outstanding and entitled to vote at the
Annual Meeting.
Stockholders who own shares registered in different names or at different
addresses will receive more than one proxy card. A STOCKHOLDER WHO DOES NOT PLAN
TO ATTEND THE MEETING MUST SIGN AND RETURN EACH OF THE PROXY CARDS RECEIVED TO
ENSURE THAT ALL OF THE SHARES OWNED BY SUCH STOCKHOLDER ARE REPRESENTED AT THE
ANNUAL MEETING. Each accompanying proxy card that is properly signed and
returned to the Company and not revoked will be voted in accordance with the
instructions contained therein.
Any stockholder who gives a proxy has the power to revoke it at any time
before it is exercised by delivery to the Corporate Secretary of the Company
either in person or by mail, of a written notice of revocation. Attendance at
the Annual Meeting will not in itself constitute revocation of the proxy.
Unless contrary instructions are given, the persons designated as proxy
holders in the accompanying proxy card(s) (or their substitutes) will vote FOR
the election of the Board of Directors' nominees, FOR the election of Arthur
Andersen LLP as the Company's independent public accountants and auditors for
the 1997 fiscal year, and in the proxy holders' discretion with regard to any
other matters (of which the Company is not now aware) that may be properly
presented at the meeting or any adjournments thereof, and all matters incident
to the conduct of the meeting.
The presence at the meeting, in person or by proxy, of a majority of the
shares of Common Stock outstanding on the Record Date will constitute a quorum.
The affirmative vote of the holders of at least a majority of the shares of
Common Stock represented in person or by proxy at the meeting and entitled to
vote at the meeting will be required with respect to the election of directors
and the election of Arthur Andersen LLP as the Company's independent public
accountants and auditors.
1
<PAGE>
Votes cast by proxy or in person at the Annual Meeting will be counted by
the persons appointed by the Company to act as the inspectors of election for
the meeting. The inspectors of election will treat shares represented by proxies
that reflect abstentions or include "broker non-votes" as shares that are
present and entitled to vote for purposes of determining the presence of a
quorum. Abstentions or "broker non-votes" do not constitute a vote "for" or
"against" any matter and thus will be disregarded in any calculation of "votes
cast". Under Hawaii law, if a broker or nominee has indicated on the proxy that
it does not have discretionary authority to vote certain shares on a matter,
those shares will be treated as present and entitled to vote with respect to
that matter unless the broker also states that the shares are not to be deemed
present for that purpose.
Any unmarked proxies, including those submitted by brokers or nominees, will
be voted in favor of the proposals and nominees of the Board of Directors, as
indicated in the accompanying proxy card.
Each share of Common Stock entitles the holder thereof to one vote on each
matter to be voted on at the Annual Meeting. Under the Company's By-Laws,
stockholders are not entitled to cumulate their votes in the election of
directors. The By-Laws also provide that the presiding officer at the meeting
may adjourn a meeting at which a quorum is present if a matter to be acted upon
at the meeting requires the affirmative vote of more than a majority of a quorum
at the meeting and the number of shares actually voted (and not abstaining) at
such meeting is insufficient to approve of such matter.
The Company's By-Laws provide that nominations of candidates for election to
the Company's Board of Directors may only be made by the Board or by a
stockholder entitled to vote at the meeting of the stockholders called for the
election of directors (the "Election Meeting"). Any such stockholder who intends
to nominate a candidate for election to the Board must deliver a notice to the
Corporate Secretary of the Company not less than 30 days prior to the date of
the Election Meeting 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 Company beneficially owned by each such intended nominee;
and (iv) such other information concerning each such intended nominee as would
be required to be included, under the rules of the Securities and Exchange
Commission (the "SEC"), in a proxy statement soliciting proxies for the election
of such nominee. Such notice also must include a signed consent of each such
intended nominee to serve as a director of the Company, if elected. To be
timely, any such notice with respect to the upcoming Annual Meeting must be
delivered to the Corporate Secretary, Castle & Cooke, Inc., 10900 Wilshire
Boulevard, Los Angeles, California 90024, no later than April 21, 1997. Any such
notice with respect to any subsequent Election Meeting must be delivered to the
Corporate Secretary not less than 30 days prior to the date of that Election
Meeting. The By-Laws provide that if the Chairman of an Election Meeting
determines that a nomination was not made in accordance with the procedures set
forth in the By-Laws, such nomination shall be void.
2
<PAGE>
BENEFICIAL OWNERSHIP OF CERTAIN STOCKHOLDERS
The following table sets forth, to the best knowledge of the Company,
information as to each person who beneficially owned more than 5% of the Company
Common Stock as of February 28, 1997 unless otherwise noted.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP(1) CLASS(2)
- ------------------------------------------------------------------------ ----------------------- ---------------
<S> <C> <C>
David H. Murdock........................................................ 4,542,600(3) 22.76%
10900 Wilshire Boulevard
Los Angeles, CA 90024
Wellington Management Company, LLP...................................... 2,153,300(4)(5) 10.79%
75 State Street
Boston, MA 02109
The Hartford Investment Management Company.............................. (5) (5)
200 Hopmeadow Street
Sinsbury, CT 06070
Sasco Capital........................................................... 1,807,829(6) 9.06%
10 Sasco Hill Road
Fairfield, CT 06430
Ingalls & Snyder........................................................ 1,006,182(7) 5.04%
61 Broadway
New York, NY 10006
</TABLE>
- ------------------------
(1) Unless otherwise indicated, each person has sole voting and dispositive
power with respect to the shares shown.
(2) The percentages set forth above are calculated on the basis of 19,957,084
shares of Common Stock outstanding on February 28, 1997, plus in the case of
Mr. Murdock, stock options granted to him under the Company's 1995 Stock
Option and Award Plan (the "1995 Plan") to purchase 14,334 shares, which
number includes all such options that are exercisable within 60 days
following March 31, 1997.
(3) Mr. Murdock does not have voting and dispositive power as to 26,956 of these
shares which are beneficially owned by or for his sons.
(4) Based on a report filed on Schedule 13G dated January 24, 1997, Wellington
Management Company, LLP ("Wellington") had shared voting power over
1,395,800 of these shares and shared dispositive power over all of these
shares.
(5) Based on a report on Schedule 13G dated February 10, 1997, The Hartford
Investment Management Company ("HIMC") reported that HIMC and/or its
affiliates beneficially owned 1,009,300 shares of Common Stock, and that
they had shared voting power and shared dispositive power over such shares.
Based on additional information obtained from HIMC, all of these 1,009,300
shares are included in the 1,395,800 shares described in note (4) above for
which Wellington reports shared voting power.
(6) Based on a report on Schedule 13G dated January 30, 1997, Sasco Capital,
Inc. had sole voting power over 1,057,096 of these shares and sole
dispositive power over all of these shares.
(7) Based on a report on Schedule 13G dated January 17, 1997, Ingalls & Snyder
LLC had sole voting power and sole dispositive power over all of these
shares.
3
<PAGE>
PROPOSAL 1
ELECTION OF DIRECTORS
GENERAL
Pursuant to the Articles of Incorporation of the Company, the Board of
Directors is comprised of seven (7) members. The Board of Directors nominated
the seven (7) persons named below for election to the Board of Directors until
the next annual meeting of stockholders and until their successors are duly
elected and qualified.
Current members of the Board will continue to serve until the election and
qualification of directors at the Annual Meeting.
Unless authority to do so is WITHHELD, the persons named in each proxy card
(or their substitutes) will vote the shares represented thereby FOR the election
of ALL the director nominees named below. If any nominee becomes unavailable or
is unable to serve as a director, which is not anticipated, the persons named as
proxies (or their substitutes) shall have full discretion and authority to vote
or refrain from voting for any other nominee in accordance with their judgement.
NOMINEES
The following brief statements contain biographical information concerning
each nominee for election as a director, including information concerning his or
her principal occupation for at least the past five years, as of February 28,
1997. Except for Mr. Murdock, Mr. Miyahira and Ms. Scott Safrit, all nominees
and current directors are otherwise unaffiliated with the Company and its
subsidiaries.
<TABLE>
<CAPTION>
YEAR ELECTED PRINCIPAL OCCUPATION, POSITIONS WITH THE COMPANY
NAME AS A DIRECTOR AGE AND SUBSIDIARIES AND OTHER INFORMATION
- --------------------------- --------------- --- ----------------------------------------------------------------
<S> <C> <C> <C>
David H. Murdock........... 1995 73 Chairman of the Board, Chief Executive Officer and Director of
Dole Food Company, Inc. (the Company's former parent) since July
1985 and of the Company since October 1995. Chairman of the
Board, Chief Executive Officer and Director of Castle & Cooke
Homes, Inc. (formerly a publicly-traded company that was 82%
owned by Dole) from September 1992 until January 1995. Since
June 1982, Chairman of the Board and Chief Executive Officer of
Flexi-Van Leasing, Inc., a Delaware corporation wholly-owned by
Mr. Murdock. Sole owner and developer of the Sherwood Country
Club in Ventura County, California, and numerous other real
estate developments; also sole stockholder of numerous
corporations engaged in a variety of business ventures and in
the manufacture of textile-related products, and industrial and
building products.
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
YEAR ELECTED PRINCIPAL OCCUPATION, POSITIONS WITH THE COMPANY
NAME AS A DIRECTOR AGE AND SUBSIDIARIES AND OTHER INFORMATION
- --------------------------- --------------- --- ----------------------------------------------------------------
<S> <C> <C> <C>
Wallace S. Miyahira........ 1996 64 President--Hawaii Residential and Commercial Operations of the
Company and a Director since December 1996. Senior Vice
President of the Company from October 1995 to December 1996.
Senior Vice President of Castle & Cooke Homes, Inc. from June
1993 to January 1995. Senior Vice President of Castle & Cooke
Properties, Inc. from 1983 to December 1996, and President since
December 1996. President of Castle & Cooke Homes Hawaii, Inc. (a
subsidiary of the Company conducting the residential real estate
business in Hawaii) from 1984 to March 1995 and from December
1995 to present.
Lynne Scott Safrit......... 1995 38 President--North American Commercial Operations of the Company
since October 1995 and Director since December 1995. President
of Mega Management Company, Inc. since December 1993, and
President of Atlantic American Properties, Inc. since August
1989, both of which are real estate management companies
wholly-owned, directly or indirectly, by Mr. David H. Murdock.
Ms. Scott Safrit is also a member of the Board of Directors of
Landis Savings Bank.
Dell Trailor............... 1996 70 President and owner of Dell Trailor Construction Company,
Phoenix, Arizona, a real estate development company. Mr. Trailor
also served on the Board of Directors of Castle & Cooke Homes,
Inc. from April 1993 until January 1995.
Edward J. Hogan............ 1996 69 Chairman of the Board and Chief Executive Officer of Pleasant
Holidays, Inc. and numerous corporations engaged in the travel
industry. Mr. Hogan also served on the Board of Directors of
Castle & Cooke Homes, Inc. from April 1993 until January 1995.
Member of the Board of Directors of the American Society of
Travel Agents, The United States Tour Operators Association,
Loyola Marymount University, ChildHelp USA, and the Hugh O'Brien
Youth Foundation.
Lodwrick M. Cook........... 1996 68 Chairman Emeritus, ARCO. Chairman and Chief Executive Officer of
ARCO from January 1986, retiring as CEO in June 1994 and as
Chairman in June 1995. Mr. Cook is also a member of the Board of
Directors of H.F. Ahmanson & Company and Lockheed-Martin
Corporation.
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
YEAR ELECTED PRINCIPAL OCCUPATION, POSITIONS WITH THE COMPANY
NAME AS A DIRECTOR AGE AND SUBSIDIARIES AND OTHER INFORMATION
- --------------------------- --------------- --- ----------------------------------------------------------------
<S> <C> <C> <C>
Edward M. Carson........... 1996 67 Retired Chairman of the Board and Chief Executive Officer of
First Interstate Bancorp. Chairman of the Board and Chief
Executive Officer of First Interstate Bancorp from June 1990
until May 1995. Mr. Carson is also a member of the Board of
Directors of Wells Fargo Bank, Terra Industries, Inc. and Aztar
Corporation.
</TABLE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF EACH OF THE
NOMINEES DESCRIBED ABOVE.
COMMITTEES OF THE BOARD OF DIRECTORS
There are three standing committees of the Board of Directors of the
Company: the Executive Committee; the Audit Committee; and the Corporate
Compensation and Benefits Committee.
The primary purposes of the Executive Committee are (1) to exercise, during
intervals between meetings of the Board and subject to certain limitations, all
of the powers of the full Board; (2) to monitor and advise the Board on
strategic business and financial planning matters for the Company; and (3) to
deal with matters relating to the directors of the Company. The Board does not
have a nominating committee. The present members of the Executive Committee are
Mr. David Murdock, Mr. Lodwrick Cook and Mr. Edward Carson. The Executive
Committee did not meet during the 1996 fiscal year.
The Audit Committee is comprised entirely of directors who are not officers
or employees of the Company. It is responsible for monitoring and reviewing
accounting methods adopted by the Company, internal accounting procedures and
controls and audit plans. The Audit Committee receives directly the reports of
the Company's independent public accountants and the internal audit staff. It
meets periodically both with the independent public accountants and internal
auditors to review audit results and the adequacy of the Company's system of
internal controls. The Audit Committee also recommends to the Board the
selection of the Company's independent public accountants and auditors. The
present members of the Audit Committee are Mr. Edward Carson, Mr. Edward Hogan
and Mr. Dell Trailor. The Audit Committee held two meetings during the 1996
fiscal year.
The Corporate Compensation and Benefits Committee (the "Compensation
Committee") is comprised entirely of directors who are not current or former
officers or employees of the Company. It is responsible for ensuring that the
officers and key management personnel of the Company are effectively compensated
with salaries, supplemental compensation and benefits that are equitable and
competitive. In addition, the Compensation Committee serves as the "named
fiduciary" (as defined in the Employee Retirement Income Security Act of 1974,
as amended) of certain employee pension and welfare benefit plans with
responsibility for the adoption, operation, administration and amendment of such
plans and the administration of the Company's discretionary stock award plans.
The present members of the Compensation Committee are Mr. Lodwrick Cook, Mr.
Edward Hogan and Mr. Dell Trailor. The Compensation Committee held five meetings
during the 1996 fiscal year.
MEETINGS OF THE BOARD OF DIRECTORS
During the 1996 fiscal year there were six regularly scheduled meetings of
the Board of Directors. The incumbent directors attended at least 75% of the
aggregate number of Board meetings and meetings of committees on which they
serve.
COMPENSATION OF DIRECTORS
Directors who are not employees of the Company ("Non-Employee Directors")
are compensated for their services according to a standard arrangement
authorized by the Board of Directors. Non-Employee
6
<PAGE>
Directors receive an annual retainer fee of $10,000 payable quarterly in cash
and $10,000 in share credits under the Company's Directors Deferred Stock
Compensation Plan (the "DSC Plan"), a deferred compensation, stock-indexed plan
payable solely in shares of the Company's Common Stock as described below.
Additional cash fees of $1,000 are paid to each Non-Employee Director for each
regularly scheduled meeting of the Board that he or she attends, and a fee of
$500 is paid for each telephonic meeting of the Board in which the Non-Employee
Director participates. In addition, Non-Employee Director members of the
committees are compensated at the rate of $1,000 for each committee meeting
actually attended, and the Non-Employee Director chairperson of a committee
receives an additional annual amount of $2,500. The reasonable expenses incurred
by each Non-Employee Director in connection with his or her duties as a director
are also reimbursed by the Company, including certain expenses incurred by
Non-Employee Directors' spouses in accompanying Non-Employee Directors to one
Board meeting each year. Board members who are officers or other employees of
the Company do not receive compensation for their services as directors.
Under the DSC Plan, each eligible director received on June 1, 1996 and will
receive, on June 1 of each subsequent year, share credits equal to the number of
shares of Common Stock that $10,000 would then buy (based on an average pricing
formula). All share credits are fully vested as accrued. Share credits
constitute bookkeeping entries that will be settled and paid in an equivalent
number of shares of Common Stock upon the director's termination of service on
the Board. A director may irrevocably elect to receive his or her accrued share
credits in a lump-sum or in equal annual installments over a period of up to
five years after termination of service. However, notwithstanding installment
elections, if a director dies or the director is disabled or a change in control
occurs, the share credits will be paid in a lump-sum when the director's service
ends. During the period that the director's interest is represented by share
credits, a director will have no voting, dividend or other rights of a
shareholder with respect to the shares to be issued in his or her name, but will
be entitled to additional share credits representing dividend equivalents based
on cash dividends and distributions (if any) on the underlying shares (converted
to share credits based on the market value of shares on the applicable dividend
or distribution payment dates). The number of share credits and shares subject
to the DSC Plan are subject to appropriate adjustment in the event of a stock
split, recapitalization, or other reorganization or similar events.
7
<PAGE>
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information with respect to shares of
the Company's Common Stock beneficially owned (or deemed to be beneficially
owned) by the Company's directors, its Named Executive Officers (as defined
under "Compensation of Executive Officers") and by all directors and executive
officers of the Company as a group, as of February 28, 1997.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF
NAME AND ADDRESS OF BENEFICIAL PERCENT OF
BENEFICIAL OWNER(1) OWNERSHIP(2) OUTSTANDING SHARES(3)
- ------------------------------------------------------------------- ---------------------- -----------------------
<S> <C> <C>
David H. Murdock................................................... 4,542,600(4) 22.76%
Lodwrick M. Cook................................................... 1,500(5) *
Edward J. Hogan.................................................... 10,000(5) *
Dell Trailor....................................................... 17,000(5) *
Edward M. Carson................................................... 2,500(5) *
Thomas C. Leppert.................................................. 0(6) *
Lynne Scott Safrit................................................. 5,000(6) *
Wallace S. Miyahira................................................ 36,399(6) *
Bruce M. Freeman................................................... 4,334(6) *
Thomas C. Hoadley.................................................. 2,334(6) *
Edward C. Roohan................................................... 2,334(6) *
Roberta Wieman..................................................... 3,334(6) *
All Directors and Executive Officers as a Group (12 Individuals
including Mr. Leppert)............................................ 4,627,335(6) 23.19%
</TABLE>
- --------------------------
* Represents less than 1% of the class of securities.
(1) The mailing address for each of the individuals listed is Castle & Cooke,
Inc., 10900 Wilshire Boulevard, Los Angeles, California 90024.
(2) Unless otherwise indicated in these notes, each person has sole voting and
dispositive power with respect to the shares shown. Some directors and
executive officers may share the voting and dispositive power over their
shares with their spouses as community property, joint tenants or tenants in
common, and some of them may hold the shares through revocable living trusts
of which they are trustees solely for their benefit during their lifetimes
or through family trusts of which they are a trustee and under which they
and immediate family members are beneficiaries and/or trustees.
(3) The percentages set forth above are calculated on the basis of 19,957,084
shares of Common Stock outstanding on February 28, 1997, plus, where
applicable, all stock options granted under the Company's stock option plans
that are exercisable within 60 days following March 31, 1997.
(4) Mr. Murdock customarily maintains revolving lines of credit in conjunction
with his various business activities, under which borrowings and security
vary from time to time, and pursuant to which he provides collateral owned
by him, including his Company securities. His reported holdings include
4,501,310 shares of Common Stock held by Flexi-Van Leasing, Inc., a
corporation wholly-owned by Mr. Murdock, and 26,956 shares of Common Stock
held by or for the benefit of Mr. Murdock's sons.
(5) In addition to these amounts, each of the individuals indicated has 570.19
stock units credited to his account pursuant to the DSC Plan, described
above under "Compensation of Directors."
(6) Shares reported include non-transferable, non-voting employee stock options.
The individuals and group indicated beneficially own the following number of
shares of Common Stock that may be purchased upon the exercise of employee
stock options exercisable on March 31, 1997, or within 60 days thereafter:
Mr. Murdock, 14,334; Mr. Miyahira, 36,399; Ms. Scott Safrit, 5,000; Mr.
Freeman, 4,334; Mr. Hoadley, 2,334; Mr. Roohan, 2,334; Ms. Wieman, 3,334;
and all directors and executive officers as a group, 68,069. Mr. Leppert, a
former executive officer of the Company, owned no shares as of February 28,
1997.
8
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth, as to the Chief Executive Officer, the other
four most highly-compensated executive officers of the Company, and one
individual who would have been among the other four most highly compensated
officers of the Company but for the fact that the individual was not serving as
an executive officer at the end of the 1996 fiscal year (the "Named Executive
Officers"), information concerning the compensation paid by the Company and
certain related entities (including all subsidiaries) for services in all
capacities rendered to or for the benefit of the Company.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
SECURITIES
OTHER ANNUAL UNDERLYING ALL OTHER
NAME AND BONUS $ COMPENSATION OPTIONS COMPENSATION
PRINCIPAL POSITION YEAR SALARY ($) (2) ($)(3) (#)(6) $(4)
- ------------------------------- --------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
David H. Murdock(5) ........... 1996 400,010(1) 125,000(1) -- 43,000 0
Chairman & CEO 1995 -- (1) -- (1) -- -- 0
1994 323,090(1) -- (1) -- -- 0
Thomas C. Leppert(7) .......... 1996 351,056 0 -- 33,000 177,564(10)
President, Residential and 1995(1) 350,012 52,500 -- 0 4,500
Hawaii Commercial Operations 1994(1) 350,012 337,500 -- 7,079 4,500
Bruce M. Freeman(7) ........... 1996 250,000 110,000 -- 13,000 4,500
Senior Vice President 1995(1) 250,000 100,000 -- 0 4,500
1994(1) 233,777 0 29,342(8) 0 3,269
Wallace S. Miyahira(7) ........ 1996 226,576 48,800 -- 20,000 4,500
President--Hawaii Residential 1995(1) 220,492 30,000 -- 0 4,500
and Commercial Operations 1994(1) 216,500 180,000 -- 0 4,500
Lynne Scott Safrit(5) ......... 1996 150,000 96,800 -- 15,000 3,635
President--North American 1995 150,000 75,000 -- 0 0
Commercial Operations 1994 150,000 50,000 -- 0 0
Thomas C. Hoadley ............. 1996 150,729(9) 12,600 -- 7,000 4,246
Senior Vice President 1995 112,309(9) 30,000 -- 0 1,788
1994 71,618 9,192 -- 0 0
</TABLE>
- ------------------------------
(1) Amounts reported do not include cash compensation paid to Mr. Murdock by
Dole for these years. Cash compensation paid by Dole to Mr. Murdock prior to
the distribution to its stockholders of all of the common stock of the
Company on December 28, 1995 (the "Distribution"), was as follows:
1996--$700,000 (salary) and $630,000 (bonus); 1995--$700,000 (salary) and
$787,500 (bonus); 1994--$676,923 (salary) and $0 (bonus). Amounts reported
as cash compensation to Mr. Murdock, Mr. Leppert, Mr. Freeman and Mr.
Miyahira for the 1994 and 1995 fiscal years include amounts paid by Castle &
Cooke Homes, Inc. ("CKI").
(2) Bonus amounts shown reflect payments made in the subsequent year with
respect to performance for the identified year.
(3) Does not include perquisites which total the lesser of $50,000 or 10% of the
reported annual salary plus bonus for any year.
(4) The amounts shown in this column include contributions by the Company (for
1996) under the Company's tax deferred investment plans and by Dole (for
1995 and 1994) under Dole's tax deferred investment plans for the benefit of
the individuals listed, but do not include payments made to Mr. Murdock
under Dole's defined benefit pension plan. See "Pension Plans."
(5) Mr. Murdock is also the Chairman and Chief Executive Officer of Dole and (in
1993 and 1994) was also Chairman and Chief Executive Officer of CKI. Mr.
Murdock and Ms. Scott Safrit also hold positions with certain business
entities owned by Mr. Murdock that are not controlled directly or indirectly
by Dole or the Company. Such other entities pay compensation and provide
fringe benefits to Mr. Murdock for his services to Dole and the other
entities. Commencing January 1, 1996, Mr. Murdock and Ms. Scott Safrit were
paid for their services to the Company by the Company; their annual base
salaries were $400,000 and $150,000, respectively, and they participated in
bonus programs with other executive officers of the Company. During 1994,
1995 and 1996, Ms. Scott Safrit served as President of Mega Management
Company, Inc. ("Mega"), a corporation wholly owned by Mr. Murdock. All
compensation reflected with respect to Ms. Scott Safrit in the above table
for 1994 and 1995 was paid by Mega. During 1996, Mega did not pay
compensation to Ms. Scott Safrit; however, Mega reimbursed the Company for
services provided by Ms. Scott Safrit to Mega during 1996. See "Certain
Transactions."
9
<PAGE>
(6) Reported amounts include grants of options "at market" by the Company in
1996 and by Dole in 1994 and 1995 as to Dole options that were converted, as
further described below. Reported amounts for Mr. Murdock do not include
unconverted Dole options. Unconverted Dole options granted to Mr. Murdock
included options (adjusted in connection with the Distribution) for 55,595
shares in 1995 and 44,990 shares in 1994. In connection with the
Distribution, certain adjustments were made to outstanding employee stock
options under Dole's 1982 Stock Option and Award Plan (the "1982 Dole Plan")
and 1991 Stock Option and Award Plan (the "1991 Dole Plan"). Dole options
held by persons who were employees of the Company after the Distribution
were exchanged in 1996 for options to purchase shares of the Company's
Common Stock ("Converted Options"). Dole options held by Mr. Murdock, who is
the only Named Executive Officer option holder who remained an employee of
Dole while also becoming an employee of the Company after the Distribution,
were not exchanged for Converted Options. The conversion amounts were
determined on January 5, 1996 by multiplying the original number of Dole
shares by 2.3597; the original exercise price of the Dole options was
divided by 2.3597. The conversion was made pursuant to the anti-dilution
provisions of the 1982 Dole Plan and 1991 Dole Plan. The intent of the
conversion exchange adjustment was to preserve and not to increase or
decrease benefits under the outstanding option grants. The vesting
provisions (with prior service to Dole counting for vesting purposes) and
remaining duration of the Converted Options were unchanged by the
conversion. Reported amounts for 1996 do not include Converted Options
granted to Messrs. Leppert and Miyahira upon the Distribution. These
Converted Options (on an "as converted" basis) are reported in the Summary
Compensation Table for the year corresponding to the year in which the
original Dole options were granted.
(7) In 1994, Mr. Leppert was also a Director and President--Hawaii Operations of
CKI; Mr. Miyahira was also a Senior Vice President of CKI; and Mr. Freeman
was also President--Bakersfield/Arizona of CKI.
(8) Includes $26,239 for reimbursement of relocation expenses.
(9) Includes $10,900 housing allowance for 1996 and $10,162 housing allowance
for 1995.
(10) Includes $150,977 paid in 1997 in connection with Mr. Leppert's December
1996 resignation from the Company, as part of a total payment of $175,000,
which also included the assigned value (differences between market and
exercise prices) of vested, unexercised employee stock options for Company
Common Stock that were held by Mr. Leppert on October 31, 1996, which was
the time the total payment was determined.
10
<PAGE>
OPTION/SAR GRANTS IN THE LAST FISCAL YEAR
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
-----------------------------------------------------------
PERCENT OF
NUMBER OF TOTAL POTENTIAL REALIZABLE VALUE AT
SECURITIES OPTIONS/SARS ASSUMED ANNUAL RATES OF STOCK
UNDERLYING GRANTED TO PRICE APPRECIATION FOR OPTION
OPTIONS/SARS EMPLOYEES IN EXERCISE OR TERM(1)
GRANTED LAST FISCAL BASE EXPIRATION ---------------------------------
NAME (2)(3) YEAR PRICE/($/SH) DATE(4) 0%($) 5%($) 10%($)
- ------------------------ ------------- --------------- ----------- -------------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
David H. Murdock........ 43,000 19.0% $ 12.375 Feb. 7, 2006 0 334,651 848,070
Thomas C. Leppert....... 33,000 14.6% $ 12.375 Feb. 7, 2006(5) 0 (5) (5)
Wallace S. Miyahira..... 20,000 8.8% $ 12.375 Feb. 7, 2006 0 155,651 394,451
Lynne Scott Safrit...... 15,000 6.6% $ 12.375 Feb. 7, 2006 0 116,739 295,838
Bruce M. Freeman........ 13,000 5.8% $ 12.375 Feb. 7, 2006 0 101,173 256,393
Thomas C. Hoadley....... 7,000 3.1% $ 12.375 Feb. 7, 2006 0 54,475 138,058
</TABLE>
- ------------------------
(1) The amounts under the columns labeled "5%" and "10%" are included pursuant
to certain rules promulgated by the SEC and are not intended to forecast
future appreciation, if any, in the price of the Company's Common Stock. As
set forth in note 4 below, the option grants vest over a three year period.
The reported amounts are based on the assumption that the named persons hold
the options granted for their full ten-year term. The actual value of the
options will vary in accordance with the market price of the Company's
Common Stock. The column headed "0%" is included to demonstrate that the
options were granted at fair market value and optionees will not recognize
any gain without an increase in the stock price, which increase benefits all
stockholders commensurately.
(2) Stock options were granted under the Company's 1995 Stock Option and Award
Plan (the "1995 Plan"). Options under the 1995 Plan may result in payments
following the resignation, retirement or other termination of employment
with the Company or its subsidiaries or as a result of a change in control
of the Company. Vested options under the 1995 Plan may be exercised within a
period of twelve months following a termination by reason of disability or
(in the case of Converted Options replacing 1991 Dole Plan options) death or
retirement, and three months following a termination for other reasons,
except that Converted Options replacing 1982 Dole Plan options may be
exercised following an employee optionee's death for the remainder of their
term. The 1995 Plan permits the Compensation Committee, which administers
the 1995 Plan, to accelerate, extend or otherwise modify benefits payable
under the applicable awards in various circumstances, including a
termination of employment or change in control. Under the 1995 Plan, if
there is a change in control of the Company (as defined in the 1995 Plan),
all options become immediately exercisable unless the Compensation Committee
otherwise determines.
(3) These Options vest one-third each year over a three year period from the
date of grant, which was February 8, 1996.
(4) These Options were granted for a term of ten (10) years, subject to earlier
termination in certain events such as termination of employment (see note 2
above). The Company's 1995 Plan contemplates customary adjustments if a
reorganization event occurs.
(5) Mr. Leppert resigned from the Company in 1996. In connection with this
event, he received a total payment from the Company of $175,000, which
included the assigned value (namely, $24,023 which was the difference
between the market and exercise prices) of vested, unexercised Converted
Options held by Mr. Leppert on October 31, 1996, which was the time the
total payment was determined. All options granted in 1996 terminated prior
to vesting.
11
<PAGE>
AGGREGATED OPTION/SAR EXERCISES IN THE LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUE
The following table and the notes thereto set forth for the Named Executive
Officers, information with respect to options for the Company's Common Stock
settled under the 1995 Plan during the 1996 fiscal year and the number and value
of unexercised in-the-money options for the Company's Common Stock held as of
the end of fiscal 1996.
AGGREGATED OPTION/SAR EXERCISES AND
FISCAL YEAR-END OPTION/SAR VALUE (1996 FISCAL YEAR)
<TABLE>
<CAPTION>
NUMBER OF VALUE OF
SECURITIES UNEXERCISED
UNDERLYING OPTIONS IN-THE-MONEY
AT FY-END (#) OPTIONS AT FY- END
SHARES ACQUIRED EXERCISABLE/ ($) EXERCISABLE/
ON VALUE UNEXERCISABLE UNEXERCISABLE
NAME EXERCISE (#) REALIZED ($) (#)(1) ($)(2)
- ------------------------------------------ ----------------- ------------- ------------------- -------------------
<S> <C> <C> <C> <C>
David H. Murdock.......................... 0 0 0/43,000 0/150,500
Thomas C. Leppert......................... (3) 24,023(3) 0 0
Wallace S. Miyahira....................... 0 0 29,732/20,000 33,828/70,000
Lynne Scott Safrit........................ 0 0 0/15,000 0/52,500
Bruce M. Freeman.......................... 0 0 0/13,000 0/45,500
Thomas C. Hoadley......................... 0 0 0/7,000 0/24,500
</TABLE>
- ------------------------
(1) As discussed in note 6 to the Summary Compensation Table, some of these
stock options, called the Converted Options, replace options originally
granted under the 1982 Dole Plan and the 1991 Dole Plan. Under the 1995
Plan, each of these options has a term of ten (10) years from the applicable
grant date of the option under the applicable Dole Plan, subject to earlier
termination in certain events related to termination of employment described
below. These Company options may result in payments following the
resignation, retirement or other termination of employment with the issuer
or its subsidiaries or as a result of a change in control, recapitalization
or reorganization of the Company. Vested options under the 1995 Plan may be
exercised within a period of twelve months following a termination by reason
of disability or (in the case of options replacing 1991 Dole Plan options)
death or retirement, and three months following a termination for other
reasons, except that options replacing 1982 Dole Plan options may be
exercised following an employee optionee's death for the remainder of their
term. The 1995 Plan permits the Compensation Committee, which administers
the Plan, to accelerate, extend and otherwise modify benefits payable under
the applicable awards in various circumstances, including a termination of
employment or a change in control. Under the 1995 Plan, if there is a change
in control of the Company, all options become immediately exercisable unless
the Compensation Committee otherwise determines.
(2) This amount represents solely the difference between the market value on the
last trading day of the year of those unexercised options which had an
exercise price below such market price (I.E., "in-the-money options") and
the respective exercise prices of the options. No assumptions or
representations regarding the "value" of such options are made or intended.
(3) Mr. Leppert resigned from the Company in 1996. In anticipation of and in
connection with this event, on October 31, 1996, he agreed to receive a
total payment of $175,000, which included the value of his vested
unexercised options (namely, $24,023, an amount equal to the difference
between their market price and exercise price on that date). The payment of
$175,000 was made to Mr. Leppert in January 1997. His unvested options
expired in December 1996.
12
<PAGE>
PENSION PLANS
The Company maintains a noncontributory pension plan which provides
benefits, following retirement at age 65 or older with one or more years of
credited service (or age 55 with five or more years of credited service), to
certain salaried, non-union employees of the Company, including executive
officers of the Company. This plan provides a monthly pension to supplement
personal savings and Social Security benefits. The following table shows as of
January 1, 1997, the estimated annual benefits payable under the pension plan in
which the Named Executive Officers participated in 1996. As of January 1, 1997,
employees of Lanai Company, Inc., a subsidiary of the Company, including Mr.
Hoadley and Ms. Scott Safrit, ceased accruing further pension benefits. In lieu
of this, Mr. Hoadley and Ms. Scott Safrit will receive supplemental
contributions to their respective 401(k) plan accounts equal to two percent (2%)
of their respective annual base salaries and bonus payments, subject to
limitations imposed by the Internal Revenue Code as described below.
PENSION PLAN TABLE
<TABLE>
<CAPTION>
REMUNERATION 10 15 20 25 30 35
- ---------------------------------------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
$200,000................................ $ 22,000 $ 33,000 $ 47,300 $ 61,600 $ 75,900 $ 90,200
$300,000................................ $ 33,000 $ 49,500 $ 70,950 $ 92,400 $ 113,850 $ 135,300
$400,000................................ $ 44,000 $ 66,000 $ 94,600 $ 123,200 $ 151,800 $ 180,400
$500,000................................ $ 55,000 $ 82,500 $ 118,250 $ 154,000 $ 189,750 $ 225,500
$600,000................................ $ 66,000 $ 99,000 $ 141,900 $ 184,800 $ 227,700 $ 270,600
$700,000................................ $ 77,000 $ 115,500 $ 165,550 $ 215,600 $ 265,650 $ 315,700
$800,000................................ $ 88,000 $ 132,000 $ 189,200 $ 246,400 $ 303,600 $ 360,800
$900,000................................ $ 99,000 $ 148,500 $ 212,850 $ 277,200 $ 341,550 $ 405,900
$1,000,000.............................. $ 110,000 $ 165,000 $ 236,500 $ 308,000 $ 379,500 $ 451,000
</TABLE>
The table shows the estimated annual retirement benefits payable as straight
life annuities, assuming normal retirement at age 65, to persons in specified
final average compensation and years of service classifications. The plan has no
offsets for Social Security. The table shows amounts prior to offsets for
benefits payable from other plans. Covered compensation under the plan includes
base pay, bonus, performance incentives (if any) and severance pay.
The accrued benefit under the plan is 1.1% of final average annual
compensation multiplied by years of service, plus .33% of final average annual
compensation multiplied by years of service in excess of 15 years. Benefits
accrued as of September 30, 1992 under a prior benefit formula serve as minimum
entitlements. The ages, credited years of service and covered compensation as of
December 31, 1996 for individuals named in the Summary Compensation Table are as
follows: Mr. Murdock (age 73)--1 year, $525,010; Ms. Scott Safrit (age 38)--1
year, $225,000; Mr. Miyahira (age 64)--13 years, $275,376; Mr. Freeman (age
47)--3 years, $360,000; and Mr. Hoadley (age 63)--2 years, $180,729. Mr.
Leppert's employment ended in 1996 and his annual benefit payable at normal
retirement (June 15, 2019) will be $54,505. Effective January 1, 1996, Mr.
Murdock became eligible to participate in the Company's non-contributory pension
and supplemental pension benefit plan(s) which, because of Mr. Murdock's age,
will provide pension benefits to him in 1997 of approximately $4,400. Mr.
Murdock's benefits under the Company plans will be based on his service with the
Company following the Distribution.
The Internal Revenue Code places an annual maximum limit of $120,000 (at
December 31, 1996) on the benefits available to an individual under pension
plans. Furthermore, effective January 1, 1994, the Internal Revenue Code placed
an annual maximum limit of $150,000 (adjusted for inflation) on compensation
which may be considered in determining a participant's benefit under qualified
retirement programs. If an individual's benefit under the plans exceeds the
$120,000 limit or compensation exceeds the $150,000 limit, the excess will be
paid by the Company from an unfunded excess and supplemental benefit plan.
13
<PAGE>
NOTWITHSTANDING ANYTHING TO THE CONTRARY SET FORTH IN ANY OF THE COMPANY'S
FILINGS UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES EXCHANGE
ACT OF 1934, AS AMENDED, THAT MIGHT INCORPORATE FUTURE FILINGS, INCLUDING THIS
PROXY STATEMENT, IN WHOLE OR IN PART, THE FOLLOWING COMPENSATION COMMITTEE
REPORT AND PERFORMANCE GRAPH SHALL NOT BE INCORPORATED BY REFERENCE, EXCEPT TO
THE EXTENT THE COMPANY EXPRESSLY INCORPORATES SUCH REPORT OR GRAPH BY SPECIFIC
REFERENCE THERETO. THE REPORT AND GRAPH SHALL NOT BE DEEMED SOLICITING MATERIAL
OR OTHERWISE DEEMED FILED UNDER EITHER OF SUCH ACTS.
CORPORATE COMPENSATION AND BENEFITS COMMITTEE REPORT TO STOCKHOLDERS
COMPENSATION PHILOSOPHY
The Company's compensation philosophy is to relate the compensation of the
Company's executive officers to measures of Company performance that contribute
to increased value for the Company's stockholders.
GOALS
To assure that compensation policies appropriately consider the value the
Company creates for stockholders, the Company's compensation philosophy for
executive officers takes into account the following goals:
- Executive officer compensation must be focused on enhancing stockholder
value;
- Compensation must reflect a competitive and performance-oriented
environment that motivates executive officers to achieve a high level of
individual, business unit and corporate results in the business
environment in which they operate;
- Incentive-based compensation should be related to the performance of each
executive officer against financial and strategic performance goals; and
- The Company's compensation policies must enable the Company to attract and
retain top quality management.
The Compensation and Benefits Committee (the "Committee") periodically
reviews the components of compensation for the Company's executive officers on
the basis of this philosophy. Further, as the situation warrants, the Company
also retains the services of a qualified executive compensation consulting firm
to provide recommendations to the Committee to enhance the linkage of executive
officer compensation to the above goals and to obtain information as to how the
Company's compensation of executive officers compares with peer companies.
EXECUTIVE COMPENSATION COMPONENTS
The major components of compensation for executive officers consist of base
salary, annual bonuses and stock option grants. The Company periodically
evaluates the competitiveness of its executive compensation program relative to
comparable publicly-traded companies.
A group of 13 real estate development companies the ("peer group") has been
used for the past reviews of compensation for proxy-named officers. The peer
group was identified by the Committee's executive compensation consulting firm
through a comparability screening process that considered such variables as
total assets, revenue size, and product line diversity.
Broader published surveys of real estate development and hotel operations
companies, as well as the real estate industry in general, are used to evaluate
the competitiveness of total compensation for other Company executives.
The aggregate pay package for executive officers of the Company, consisting
of salary, annual bonus, and long-term incentives, principally in the form of
stock options, generally was structured to approximate
14
<PAGE>
the 50th percentile of the Company's peer group based on an analysis conducted
by the Committee's executive compensation consultant in 1995. Aggregate
compensation should exceed that level if performance exceeds expectations.
Each component of the total executive compensation package emphasizes a
different aspect of the Company's compensation philosophy:
- BASE SALARY. Base salaries for executive officers (other than the Chairman
and CEO whose salary is discussed below) are initially set upon hiring by
the Chairman and CEO (subject to periodic review by the Compensation
Committee) based on recruiting requirements (i.e., market demand),
competitive pay practices, individual experience and breadth of knowledge,
internal equity considerations and other objective and subjective factors.
Increases to base salary are made by or upon the recommendation of the
Chairman and CEO and are determined primarily on an evaluation of
competitive data and the individual's performance and contribution to the
Company. Salary reviews for senior executives typically occur at intervals
greater than twelve months. One of the officers named in the Summary
Compensation Table received a base salary increase in 1996 due to his
promotion. The Chairman and CEO's compensation is discussed below.
- ANNUAL INCENTIVES. The Company relies to a large degree on annual
incentive compensation to attract, retain and reward executive officers of
outstanding abilities and to motivate them to perform to the full extent
of these abilities.
Executive officers are eligible for annual cash bonuses under an executive
annual incentive plan. These annual cash bonuses are determined after
evaluating business and individual results, with reference to a formulaic
model and other criteria. Under the formulaic model, target bonus
opportunities for executive officers, as a percentage of base salary,
range from 30% to 50% (75% in the case of the Chairman and CEO) and
maximum bonus opportunities are twice those amounts, depending on the
Company's performance relative to performance targets set in the first
quarter for the applicable year. Specific target percentages for each
individual are determined on the basis of competitive bonus levels (as a
percent of salary), level of responsibility, ability to influence results
on a corporate or business unit level, and on occasion, subjective
factors.
In 1996, the formula bonus opportunity for executive officers was based
upon earnings before taxes ("EBT") at the consolidated (in the case of the
Chairman and CEO and two other persons) or business unit level (in the
case of other officers).
Bonuses are payable if the specified minimum level of performance is
realized and are increased to maximum levels only if substantially higher
performance levels are attained. In accordance with Company policy,
whether or not specified performance criteria are achieved, the Committee
has the discretion to authorize bonuses above or below the formula
determined amounts.
In 1996, certain business units and the consolidated corporate unit did
not reach their respective targeted performance levels. The Chairman and
CEO recommended and the Committee approved for executive officers in these
units discretionary bonuses based on an evaluation of individual
performance and the individuals's ability to influence the Company's
results, either on a corporate or business unit level, ranging from 30% to
70% of their target award level. Other business units exceeded targeted
performance levels. Based upon 1996 results, the executive officers
associated with these units received from 90% to 130% of their target
award level, based principally on the formulaic model.
- LONG-TERM INCENTIVES. The only current long-term incentive opportunity for
senior executives is the Company's stock option and award plan, which was
approved by the Board of Directors and shareholder prior to the separation
from Dole Food Company, Inc. In contrast to bonuses that are
15
<PAGE>
paid for prior year accomplishments, stock option grants represent
incentives tied to future stock appreciation. They are intended to provide
executives and managers with a direct incentive to enhance the value of
the Common Stock.
Options are granted at the discretion of the Committee (based
substantially on recommendations of the Chairman and CEO as to grants for
other officers) to persons holding key management positions above a
specified salary level. Management and the Committee review information on
option levels of other companies provided by the compensation consultants
to assure that the Company's practices are within an acceptable range of
competitive pay practices.
In 1996, the Committee approved initial stock option grants for all
executives, including the Chairman and CEO and other executive officers of
the Company. Options were granted at the fair market value of the Common
Stock on February 8, 1996 (representing a discount in the case of one
person who became an executive officer later in the year). Options vest
over a three-year period, with a maximum term of ten years. Guidelines for
the initial stock option grants, expressed as multiples of base salary,
were derived from a combination of competitive market data and subjective
judgment and, on average, approximated the 75th percentile of annual stock
option grants for the peer group companies. The specific number of option
shares in each grant was generally based on a multiple of base salary,
divided by the fair market value of the stock at the date of grant. In
general, the multiples for executive officers (which ranged from 62% to
133%) increased with the level of responsibility and the perceived impact
of each position on the strategic direction of the Company. The Chairman's
recommendations for individual option grant decisions reflected his
assessment of the effect of promotions, individual performance and other
factors. An individual's outstanding stock options and current stock
ownership generally were not considered in making stock option awards.
When combined with salary and target bonuses, the 1996 grants projected
total compensation at approximately the 50th to the 75th percentile of the
peer group companies.
The Committee anticipates an annual review of option grant recommendations
based on competitive data and other factors.
CEO COMPENSATION
The Compensation Committee followed the same general compensation policy
described above for all other executives to determine Mr. Murdock's 1996
compensation.
Under the formula provisions of the executive annual incentive plan, Mr.
Murdock was eligible for an annual bonus for 1996 from 37.5% to 150% of base
salary if the performance of the Company met or exceeded threshold levels
established at the beginning of the year, or up to 22.5% of base salary for
below-threshold results, subject to the Committee's further discretion. Although
1996 results did not meet the applicable threshold for a formula award, the
Committee awarded Mr. Murdock a bonus of $125,000 or 31.25% of base salary under
its general discretionary authority based on the Company's financial results and
other strategic initiatives and accomplishments, and, in particular, Mr.
Murdock's leadership in the reduction of the Company's debt levels, the
development of new business opportunities, and the careful expansion of existing
land holdings.
Mr. Murdock's base salary was approved by the Committee in February 1996. In
connection with its 1996 bonus determinations and salary review in February
1997, the Committee reviewed survey data prepared by the Company's compensation
consultant on base salary and total cash compensation for the chairman and chief
executive officer positions of the peer group of companies described above, as
well as the aggregate compensation of the top two executive officers of those
companies. The compensation consultant presented its findings regarding a
competitive range of base salary and bonus for the Chairman and Chief Executive
Officer. As a result of this review, the Committee concluded that for 1996
16
<PAGE>
Mr. Murdock's base salary was near the median of the competitive salary range
for Chairman and Chief Executive Officers and at the lower end of that range for
total cash compensation, including salary and bonus. In the context of its
annual review in February 1997, the Committee also reviewed the expected salary
adjustment budget for all employees in the Company. Following this review, the
Committee increased Mr. Murdock's salary from $400,000 to $425,000, effective
February 24, 1997, which it believes will place him within the median
competitive salary range in the peer group for 1997. In making these decisions,
the Committee took into account the fact that Mr. Murdock also serves as
Chairman and Chief Executive Officer of Dole Food Company, Inc.
Acting on the recommendation of the Committee's compensation consultant, in
February 1996, the Committee approved an initial stock option grant for Mr.
Murdock in the amount of 43,000 options. This grant, which was made at fair
market value on the date of grant and vests over three years, reflects a salary
multiple of 1.33 (which was at the 75th percentile of annual stock option grants
for CEOs within the real estate development peer group used by the consultant).
The Committee anticipates an annual review of option grant recommendations for
the CEO along with its annual review of other option grant recommendations.
SECTION 162(M) CONSIDERATIONS
The United States Internal Revenue Service has promulgated rules affecting
all publicly held United States corporations (the "162(m) Rules ") that impose
limits on the tax deductibility of compensation in excess of $1 million in any
year for certain executive officers, except for "performance-based compensation"
meeting the conditions of the 162(m) Rules. No covered executive's compensation
for these purposes exceeded $1 million for 1996. The Compensation Committee
considers the 162(m) Rules as one of the factors it reviews with respect to
compensation matters. The Compensation Committee, generally speaking, plans to
limit compensation to amounts deductible under Section 162(m) of the Code,
either by structuring qualifying performance awards in the future, or by
deferral of payment or other means. However, changes in the tax laws or
interpretations, other priorities, or special circumstances may result in or
warrant exceptions to this plan.
The Corporate Compensation
and Benefits Committee
Lodwrick M. Cook, Chairman
Edward J. Hogan, Director
Dell Trailor, Director
17
<PAGE>
PERFORMANCE GRAPH
The Company became a public company as a result of the Distribution. The
following graph compares the cumulative total return to the stockholders of the
Company's Common Stock from December 31, 1995, to December 31, 1996, with the
cumulative total return on the Standard & Poor's 500 Index of widely held common
stocks (the "S&P 500 Index") and a group of peer issuers (the "Peer Group"). The
Peer Group was selected on the basis of being in the same line or lines of
business as the Company. The following companies are the members of the Peer
Group: The Rouse Company; Catellus Development Corporation; Pulte Corporation;
Toll Brothers, Inc.; Lennar Corporation; Forest City Enterprises, Inc.; Newhall
Land & Farming Company; Kaufman & Broad Home Corporation; Avatar Holdings, Inc.;
Del Webb Corporation; Standard-Pacific Corp.; Ryland Group, Inc.; Schuler Homes,
Inc.; Beazer Homes USA, Inc.; Hovnanian Enterprises, Inc.; and Presley
Companies.
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
CASTLE & COOKE, INC. S&P 500 INDEX PEER GROUP INDEX
<S> <C> <C> <C>
12/31/95 $100 $100 $100
12/31/96 $95 $123 $114
</TABLE>
- ------------------------
Assumes $100 invested on December 31, 1995 in Castle & Cooke, Inc. Common Stock,
the S&P 500 Index and an index comprised of members of the Peer Group (weighted
according to each member's market capitalization). The total returns represent
stock price changes plus the reinvestment of dividends.
18
<PAGE>
CERTAIN TRANSACTIONS
The transactions described below in which Mr. Murdock or his affiliates or
Dole had an interest during 1996 were reviewed by the Audit Committee of the
Board of Directors of the Company.
TRANSACTIONS WITH DOLE
David H. Murdock is Chairman and CEO of the Company and of Dole, and
beneficially owns approximately 18% of the outstanding common stock of Dole.
In connection with the Distribution, the Company and Dole entered into
various agreements to define ongoing relationships, including, without
limitation, an Allocation Agreement and an Aircraft Co-Ownership Agreement. In
1996, the Company received a general excise tax refund of $273,027 from the
State of Hawaii which, pursuant to the Allocation Agreement, the Company owed
and paid to Dole in the first quarter of 1997. In addition, the Company charged
Dole rent of $749,140 for Dole's use of office space in 1996 in buildings owned
by the Company in Bakersfield California and Honolulu Hawaii. During 1996, the
Company purchased $277,440 of products from Dole for the Company's Lanai resorts
and Oahu retail operation.
In connection with the Distribution, the Company received a 50% undivided
interest in a corporate aircraft that was owned by Dole. Dole retained the other
50% undivided interest in the aircraft. Under the Aircraft Co-Ownership
Agreement, the Company and Dole agreed that each party would be responsible for
the direct costs associated with its use of the aircraft, and that all indirect
costs would be equally shared. The Company's and Dole's shares of such costs for
1996 were $547,729 and $576,306, respectively. Dole generally pays such costs
and the Company reimburses Dole for the Company's share on an ongoing basis.
In connection with the Distribution, and as partial consideration for Dole's
real estate and resorts business, the Company issued to Dole two promissory
notes. The principal amount of one of these, a $200 million Interim Note, was
repaid in 1995. Interest of $738,889 incurred on the Interim Note was paid by
the Company to Dole in February 1996. The second note, a $10 million Term Note,
is payable on December 8, 2000 and bears interest, from December 8, 1995 until
paid, at the rate of 7% per annum, payable quarterly. Interest accrued and paid
by the Company on the Term Note for 1996 was $700,000.
TRANSACTIONS WITH OTHER ENTITIES
David H. Murdock, the Company's Chairman and Chief Executive Officer, owns a
real estate management company, which is managed by Ms. Lynne Scott Safrit, a
director and executive officer of the Company. During 1996, this real estate
management company provided certain support services to the Company and the
Company provided certain management services to the real estate management
company resulting in a net amount due from the real estate management company to
the Company of $73,371. This amount was paid to the Company in the first quarter
of 1997. Mr. Murdock also paid the Company and Dole, as co-owners of the
aircraft which is the subject of the Aircraft Co-Ownership Agreement described
above, a total of $56,286 representing the incremental cost to the Company and
Dole for Mr. Murdock's personal use of the aircraft during 1996. This payment
was shared equally by the Company and Dole.
PROPOSAL 2
ELECTION OF
INDEPENDENT PUBLIC ACCOUNTANTS AND AUDITORS
Upon the recommendation of the Audit Committee, the Board of Directors of
the Company has appointed Arthur Andersen LLP as the Company's independent
public accountants and auditors for the 1997 fiscal year ending December 31,
1997, subject to stockholder approval. Arthur Andersen LLP (and its
19
<PAGE>
predecessors) has served as the Company's (or its predecessor, Dole Food
Company, Inc.) independent public accountants and auditors since 1985.
Services which will be provided to the Company and its subsidiaries by
Arthur Andersen LLP with respect to the 1997 fiscal year include the examination
of the Company's consolidated financial statements, reviews of quarterly
reports, services related to filings with the SEC and consultations on various
tax matters.
A representative of Arthur Andersen LLP will be present at the Annual
Meeting to respond to appropriate questions and to make such statements as he or
she may desire.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF ARTHUR
ANDERSEN LLP AS THE COMPANY'S INDEPENDENT PUBLIC ACCOUNTANTS AND AUDITORS.
MISCELLANEOUS
OTHER MATTERS
If any other matters properly come before the meeting, it is the intention
of the proxy holders to vote in their discretion on such matters pursuant to the
authority granted in the proxy and permitted under applicable law.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires that executive
officers, directors, and holders of more than 10% of a company's registered
class of securities file reports of their ownership of a company's securities
with the SEC. Based on a review of these reports, the Company believes that its
reporting persons complied with all applicable filing requirements, except for
one year-end report concerning an earlier exempt grant of non-transferable,
non-voting stock options made under the 1995 Plan to Ms. Wieman. Her report for
this transaction was filed after the applicable due date once the oversight was
discovered.
COST OF SOLICITING PROXIES
The expenses of preparing and mailing the Notice of Annual Meeting, the
Proxy Statement and the proxy card(s) will be paid by the Company. In addition
to the solicitation of proxies by mail, proxies may be solicited by directors,
officers and employees of the Company (who will receive no additional
compensation) by personal interviews, telephone, telegraph and facsimile. The
Company has retained D. F. King & Co., Inc. to assist in the solicitation of
proxies. D. F. King & Co., Inc. will be paid approximately $5,000, plus
out-of-pocket expenses, for its services. It is anticipated that banks,
custodians, nominees and fiduciaries will forward proxy soliciting material to
beneficial owners of the Company's Common Stock and that such persons will he
reimbursed by the Company for their expenses incurred in so doing.
FORM 10-K AND ANNUAL REPORT TO SHAREHOLDERS
Enclosed with this Proxy Statement is the Annual Report on Form 10-K of the
Company for the 1996 fiscal year. The Annual Report on Form 10-K is enclosed for
the convenience of stockholders only and should not be viewed as part of the
proxy solicitation material. If any person who was a beneficial owner of Common
Stock of the Company on the record date for the 1997 Annual Meeting desires
additional copies of the Company's Annual Report on Form 10-K, the same will be
furnished without charge upon receipt of a written request. The request should
identify the person making the request as a stockholder of the Company as of
April 2, 1997 and should be directed to Debbie Rau, Castle & Cooke, Inc., 10900
Wilshire Blvd., Ste. 1600, Los Angeles, CA 90024.
20
<PAGE>
PROPOSALS OF STOCKHOLDERS
The 1998 Annual Meeting of Stockholders is presently expected to be held on
or about May 15, 1998. To be considered for inclusion in the Company's Proxy
Statement for the 1998 Annual Meeting, proposals of stockholders intended to be
presented at the Meeting must be received by the Corporate Secretary, Castle &
Cooke, Inc., 10900 Wilshire Boulevard, Los Angeles, California 90024, no later
than December 14, 1997.
<TABLE>
<S> <C>
By Order of the Board of Directors,
[SIGNATURE]
Roberta Wieman
CORPORATE SECRETARY
</TABLE>
April 10, 1997
21
<PAGE>
PROXY
CASTLE & COOKE, INC.
PROXY FOR COMMON STOCK
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints DAVID H. MURDOCK, WALLACE S. MIYAHIRA AND
ROBERTA WIEMAN, and each of them, as Proxies, each with full power of
substitution and each with all powers that the undersigned would possess if
personally present, to vote all of the shares of Common Stock of Castle &
Cooke, Inc. (the "Company") which the undersigned may be entitled to vote at
the Annual Meeting of Stockholders of the Company to be held at the Beverly
Hilton Hotel, 9876 Wilshire Boulevard, Beverly Hills, California, on
Wednesday, May 21, 1997 at 10:00 a.m. local time, and any adjournments
thereof. The undersigned instructs each of said Proxies, or their
substitutes, to vote as specified by the undersigned on the reverse side and
to vote in such manner as they may determine on any other matters which may
properly come before the meeting as indicated in the Notice of Annual Meeting
of Stockholders and Proxy Statement, receipt of which is hereby acknowledged.
Election of Directors. NOMINEES:
Edward M. Carson, Lodwrick M. Cook, Edward J. Hogan, Wallace S. Miyahira,
David H. Murdock, Lynne Scott Safrit and Dell Trailor
(IMPORTANT - TO BE SIGNED AND DATED ON REVERSE SIDE)
PLEASE VOTE, SIGN, DATE AND PROMPTLY RETURN THIS CARD
IN THE ENCLOSED PREPAID ENVELOPE
SEE REVERSE
SIDE
<PAGE>
CASTLE & COOKE, INC.
/X/ Please mark votes as in this example.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED OR, IF NO
DIRECTION IS MADE, FOR ITEMS 1 AND 2 AND AS SAID PROXIES DEEM ADVISABLE ON
SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING.
The Board of Directors recommends a vote FOR Items 1 and 2
1. Election of Directors (see reverse)
/ / For / / Withheld
--------------------------------------
/ / For all nominees except as noted above
2. Elect Arthur Andersen LLP as independent public
accountants and auditors for the 1997 fiscal year.
/ / For / / Against / / Abstain
MARK HERE
FOR ADDRESS / /
CHANGE AND
NOTE AT LEFT
Note: Please sign exactly as your name appears on this proxy card. If
shares are held jointly, each holder should sign. Executors, administrators,
trustees, guardians, attorneys and agents should give their full titles. If
shareholder is a corporation, sign in full corporate name by the authorized
officer.
- ------------------------- --------- --------------------------- ---------
Signature Date Signature Date
