SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
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Check the appropriate box:
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[ ] Confidential, for Use of the Commission Only (as permitted
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[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
Chiquita Brands International, 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.
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1) Title of each class of securities to which transaction
applies:___________________________________________________
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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):______________________________
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previous filing by registration statement number, or the
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4) Date Filed:________________________________________________
<PAGE>
CHIQUITA BRANDS INTERNATIONAL, INC.
Chiquita Center
250 East Fifth Street
Cincinnati, Ohio 45202
________________________________________
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
________________________________________
To be Held on May 14, 1997
To Our Shareholders:
You are invited to attend the 1997 Annual Meeting of
Shareholders of Chiquita Brands International, Inc. ("Chiquita"
or the "Company"). The meeting will be held in the Continental
Room of the Omni Netherland Plaza, 35 West Fifth Street,
Cincinnati, Ohio at 10:00 a.m. on Wednesday, May 14, 1997. At
the meeting, shareholders will:
(1) elect eight directors; and
(2) consider any other matters that may properly be brought
before the meeting.
If you hold your shares through an intermediary such as a
bank or a broker and you wish to attend the meeting, you should
bring proof of share ownership (such as a bank or brokerage firm
account statement) to the meeting or send proof of share
ownership to the Corporate Secretary, Chiquita Center, 250 East
Fifth Street, Cincinnati, Ohio 45202 well in advance of the
meeting to receive an admittance card.
Sincerely,
Carl H. Lindner
Chairman of the Board and
Chief Executive Officer
Cincinnati, Ohio
March 31, 1997
TO ENSURE THAT YOUR SHARES ARE VOTED AT THE MEETING, PLEASE VOTE,
SIGN, DATE AND PROMPTLY RETURN THE ENCLOSED PROXY FORM IN THE ENVELOPE
PROVIDED. PROXIES MAY BE REVOKED AT ANY TIME PRIOR TO THE
MEETING BY GIVING WRITTEN NOTICE OF REVOCATION TO THE COMPANY'S
SECRETARY, BY GIVING A LATER DATED PROXY, OR BY ATTENDING THE
MEETING AND VOTING IN PERSON.
<PAGE>
Chiquita Brands International, Inc.
Annual Meeting of Shareholders
May 14, 1997
PROXY STATEMENT
____________________________________
INTRODUCTION
This Proxy Statement is furnished in connection with the
solicitation by the Board of Directors of Chiquita Brands
International, Inc. ("Chiquita" or the "Company") of proxies to
be voted at the Annual Meeting of Shareholders to be held at
10:00 a.m. on Wednesday, May 14, 1997 and any adjournment of the
meeting. This Proxy Statement, the form of proxy and the
Company's 1996 Annual Report to Shareholders are being mailed to
shareholders on or about March 31, 1997. At the Annual Meeting,
shareholders will be asked to elect eight directors and to
transact any other business that may properly come before the
meeting and any adjournment of the meeting.
VOTING AT THE MEETING
_____________________
Voting Securities Outstanding
_____________________________
As of March 21, 1997, the record date for determining
shareholders entitled to notice of and to vote at the meeting
(the "Record Date"), the Company had one class of voting
securities outstanding consisting of 56,233,210 shares of Capital
Stock, $.33 par value ("Common Stock"). Holders of Common Stock
are entitled to one vote on each matter submitted to the meeting
for each share held of record on the Record Date.
Proxies and Voting
__________________
Shareholders may vote in person or by proxy at the meeting.
Proxies given may be revoked at any time before they are voted at
the meeting by filing with the Company a written revocation, by submitting
a proxy with a later date, or by appearing at the meeting
and voting in person.
Unless a contrary direction is indicated, a properly
executed proxy will be voted "FOR" the election of the nominees
proposed by the Board of Directors. The management of Chiquita
is not aware of any business to be acted upon at this meeting
other than as is described in this Proxy Statement. However, if
any other business is properly brought before the meeting, the
proxy holders indicated on the proxy form will vote the proxies in a
manner considered in their judgment to be in the best interests
of the Company and its shareholders.
Voting of Shares Held by Certain Plan Trustees and Custodians
_____________________________________________________________
Shares of Common Stock held in the Chiquita Dividend
Reinvestment Plan (the "Reinvestment Plan") are voted by the
registered holders of such shares. If a shareholder participates
in the Reinvestment Plan, the proxy represents the number of
whole shares held in the shareholder's account in the Plan as
well as shares registered in the shareholder's name.
If a shareholder participates in the Chiquita Savings and
Investment Plan (the "Savings Plan"), the Chiquita Associate
Stock Purchase Plan (the "ASPP"), or the Friday Canning
Corporation Employee Stock Ownership Plan (the "Friday ESOP"),
the proxy serves as the voting instruction to the respective
trustee or custodian for the plan. Shares held in these three
plans are voted by the respective trustee or custodian as
directed by the plan participants. The voting instructions of
participants in the Friday ESOP are tabulated by Star Bank, N.A.
and forwarded to the trustee in the aggregate to ensure the
confidentiality of the votes. Shares held in the ASPP or the
Friday ESOP will not be voted unless proxies are signed and
returned by the participants. However, if participants in the
Savings Plan do not vote their shares by returning their proxies,
these shares will be voted by the trustee in the same proportion
as those voted by other participants in the Savings Plan.
PRINCIPAL SHAREHOLDERS
______________________
As of the Record Date, the only persons known by the Company
to be the beneficial owners of more than 5% of the Company's
outstanding voting securities entitled to vote at this meeting
are:
<TABLE>
<CAPTION>
Name and Address of Class of Amount and Nature of Percent
Beneficial Owner Shares Beneficial Ownership of Class
_______________________________ ________ ____________________ ________
<S> <C> <C> <C>
American Financial Group, Inc. Common 23,996,295(1) 43%
and its subsidiaries ("AFG") Stock
One East Fourth Street
Cincinnati, Ohio 45202
FMR Corp., and its subsidiaries Common 3,958,472(2) 7%
("FMR") Stock
82 Devonshire Street
Boston, Massachusetts 02109
Norwest Corporation, and its Common 2,973,121(3) 5%
subsidiaries ("Norwest") Stock
Sixth and Marquette
Minneapolis, Minnesota 55479-1026
<FN>
(1) Carl H. Lindner, Carl H. Lindner III, S. Craig Lindner,
Keith E. Lindner, and trusts for their benefit
(collectively, the "Lindner Family"), the beneficial owners
of approximately 44% of AFG's common stock, share with AFG
voting and dispositive power with respect to the shares of
Chiquita's Common Stock owned by AFG. AFG and the Lindner
Family may be deemed to be controlling persons of Chiquita.
(2) In a Schedule 13G filed February 14, 1997, FMR reported
that, through its wholly-owned subsidiaries, Fidelity
Management & Research Company (a registered investment
adviser to various investment companies) and Fidelity
Management Trust Company (a bank serving as investment
manager for various institutional accounts), it has sole
power to dispose or direct the disposition of 3,958,472
shares of Chiquita's Common Stock and has sole power to vote
or direct the voting of 521,571 of these shares.
(3) In a Schedule 13G filed January 29, 1997, Norwest reported
that either directly or through its wholly-owned
subsidiaries, Norwest Bank Colorado, N.A.; Norwest Bank
Indiana, N.A.; and Norwest Bank Minnesota, N.A., it
beneficially owns 2,973,121 shares of Chiquita's Common
Stock, of which it has the sole power to dispose or direct
the disposition of 2,972,200 shares and has the sole power
to vote or direct the voting of 2,601,121 of these shares.
The total number reported as beneficially owned includes 921
shares which are issuable upon conversion of the $2.875 Non-Voting
Cumulative Preferred Stock, Series A.
</FN>
</TABLE>
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
______________________________________________________
The following table shows the number of shares of the
Company's Common Stock and the $2.875 Non-Voting Cumulative
Preferred Stock, Series A (the "Series A Shares"), beneficially
owned as of the Record Date by each current director and nominee,
by each Named Executive Officer identified in this Proxy
Statement, and by all directors and executive officers as a
group. None of the individuals or group of individuals named in
the table owns any of the Company's $3.75 Convertible Preferred
Stock, Series B (the "Series B Shares").
<TABLE>
<CAPTION>
Amount and Nature of Beneficial Ownership
______________________________________________
Common Stock Series A Shares
___________________________ _________________
Percent Percent
Name of Beneficial Owner Shares(1)(2) of Class Shares of Class
________________________ ________________ ________ ______ ________
<S> <C> <C> <C> <C>
Robert F. Kistinger 309,301(3) *
Carl H. Lindner 24,039,429(3)(4) 42.7%
Keith E. Lindner 24,008,182(3)(4) 42.7%
Fred J. Runk 132,295(3) *
Jean Head Sisco 32,460 *
Jos P. Stalenhoef 93,367(3) *
William W. Verity 9,000 *
Oliver W. Waddell 10,300 *
Ronald F. Walker 47,460 *
Steven G. Warshaw 164,653(3) * 100 *
All directors and executive
officers as a group
(12 persons) 24,952,308(3)(5) 43.8% 100 *
* Less than 1% of outstanding shares
<FN>
(1) Unless otherwise noted, the holder has full voting and
dispositive power with respect to the shares listed.
(2) Includes shares of Common Stock which the person or group
has the right to acquire within 60 days after the Record
Date, through the exercise of stock options granted under
Chiquita's stock option plans, in the following amounts:
Robert F. Kistinger, 303,090 shares; Carl H. Lindner, 10,800
shares; Fred J. Runk, 11,700 shares; Jean Head Sisco, 17,460
shares; Jos P. Stalenhoef, 81,468 shares; William W. Verity,
9,000 shares; Oliver W. Waddell, 6,300 shares; Ronald F.
Walker, 17,460 shares; Steven G. Warshaw, 159,000 shares;
and all directors and executive officers as a group, 697,494
shares.
(3) Includes Common Stock Units acquired in the Company's
Savings Plan through December 31, 1996 (the last date for
which information is available). Each Common Stock Unit
represents one share of Chiquita Common Stock plus a
proportionate share of the uninvested cash in the Chiquita
Stock Fund of the Savings Plan.
(4) For Carl H. Lindner and Keith E. Lindner, includes
23,996,295 shares of Common Stock held by AFG and its
subsidiaries. Carl H. Lindner and Keith E. Lindner
beneficially own shares of AFG common stock as follows:
5,101,403 (6.4% of AFG's outstanding shares), and 6,296,109
(7.9% of AFG's outstanding shares), respectively. See "Principal
Shareholders."
(5) The 23,996,295 shares of Common Stock held by AFG and
included in the holdings of both Carl H. Lindner and Keith
E. Lindner (as described in footnote 4 above) are counted
only once in the total number of shares of Common Stock
owned by all directors and executive officers as a group.
</FN>
</TABLE>
In addition to the AFG common stock owned by Carl H.
Lindner and Keith E. Lindner, directors and executive officers of
the Company owned as of the Record Date, or had the right to
acquire within 60 days after the Record Date through the exercise
of stock options, shares of common stock of AFG as follows:
Robert F. Kistinger, 612 shares; Fred J. Runk, 125,428 shares;
Jos P. Stalenhoef, 1,000 shares; Ronald F. Walker, 113,626
shares; and Steven G. Warshaw, 712 shares (the ownership of each
of such persons represents less than 1% of the outstanding common
stock of AFG). All directors and executive officers as a group
owned or had the right to acquire 11,739,065 shares of AFG common
stock, which represents 14.6% of AFG's total outstanding shares.
Additionally, Fred J. Runk owned preferred stock of American
Financial Corporation, a subsidiary of AFG ("AFC"), as follows:
4,281 shares of AFC Series F Preferred Stock and 153 shares of
AFC Series G Preferred Stock (the foregoing represent less than
1% of the outstanding shares of each of AFC's Series F and Series
G Preferred Stock).
ELECTION OF DIRECTORS
_____________________
The Board of Directors has nominated eight individuals
to be elected as a director to hold office until the next Annual
Meeting and until a successor is elected and qualified. Each of
the nominees was previously elected by the shareholders except
Mr. Warshaw, who was elected a director by the Board of Directors
March 25, 1997. If any nominee should become unable to serve as
a director, the proxies will be voted for any substitute nominee
designated by the Board of Directors. No proxy may be voted for
more than eight nominees.
Nominees for Director
_____________________
The nominees for election as a director are CARL H. LINDNER,
KEITH E. LINDNER, FRED J. RUNK, JEAN HEAD SISCO, WILLIAM W. VERITY,
OLIVER W. WADDELL, RONALD F. WALKER and STEVEN G. WARSHAW.
The following biographical information has been furnished by the
nominees.
Carl H. Lindner, 77, has been a director since 1976.
He has been Chairman of the Board of Directors and Chief
Executive Officer of the Company since 1984. He is also Chairman
of the Board and Chief Executive Officer of AFG, a holding
company formed in April 1995 which, through its subsidiaries, is
engaged primarily in specialty and multi-line property and
casualty insurance businesses and in the sale of tax-deferred
annuities. For over 35 years, Mr. Lindner has been Chairman of
the Board and Chief Executive Officer of AFC, which became a
subsidiary of AFG in 1995. Mr. Lindner also serves as Chairman
of the Board of the following companies: American Annuity Group,
Inc. ("AAG"), American Financial Enterprises, Inc. ("AFEI") and
American Premier Underwriters, Inc. ("APU"). AFG owns a
substantial ownership interest (over 80%) in each of these
companies. Mr. Lindner is Chairman of the Executive Committee.
Keith E. Lindner, 37, has been a director since 1984.
He was named Vice Chairman of the Board of Directors in March
1997. He was President and Chief Operating Officer of the
Company from 1989 to 1997. He has served the Company in various
executive capacities since 1984. He is also a Co-President and a
Director of AFG, AFC and APU. Mr. Lindner is a member of the
Executive Committee.
Fred J. Runk, 54, has been a director since 1984. He
has been Senior Vice President and Treasurer of AFG and AFC since
1995. For more than five years prior to that time, he served as
Vice President and Treasurer of AFC. He was a Vice President of
the Company from 1984 to March 1996 and was its Chief Financial
Officer from 1984 to 1994. He is also a director of AFEI.
Jean Head Sisco, 71, has been a director since 1976.
She has been a Partner in Sisco Associates, management
consultants, for more than five years. She is also a director of
American Funds Tax Exempt Series I, K-Tron International, The
Neiman Marcus Group, Inc., Santa Fe Pacific Gold Corporation,
Textron Inc. and Washington Mutual Investors Fund. Mrs. Sisco is
Chairman of the Audit Committee and a member of the Compensation
Committee.
William W. Verity, 38, has been a director since 1994.
He has been Chairman and Chief Executive Officer of ENCOR
Holdings, Inc. ("ENCOR") since 1991. ENCOR develops and
manufactures plastic molded components through two subsidiaries,
ENCOR Technologies, Inc. and Compression, Inc. ENCOR is a
subsidiary of Leaver Corp., an investment holding company. Mr.
Verity served as President of Leaver Corp. from 1987 through 1993
and is currently Chairman of that company. Mr. Verity is a
member of the Audit and Compensation Committees.
Oliver W. Waddell, 66, has been a director since 1994.
He is the former Chairman, President and Chief Executive Officer
of Star Banc Corporation, a multi-state bank holding company.
Prior to his retirement in 1993, Mr. Waddell had served in an
executive capacity with Star Banc Corporation for more than five
years. He is a director of Star Banc Corporation and CINergy
Corp. Mr. Waddell is a member of the Audit and Compensation
Committees.
Ronald F. Walker, 58, has been a director since 1984.
He has been Vice Chairman of Great American Insurance Company
("GAIC"), an AFG subsidiary, for more than five years. He was
President and Chief Operating Officer of AFC from 1984 until
April 1995 and was President and Chief Operating Officer of
Chiquita from 1984 to 1989. He is also a director of AAG, AFEI
and Tejas Gas Company. Mr. Walker is a member of the Executive
Committee.
Steven G. Warshaw, 43, has been a director since March
1997. In March 1997, he was elected President and Chief Operating
Officer of the Company and retained his position as
Chief Financial Officer. He served as Executive Vice President and
Chief Administrative Officer of the Company from 1990 to 1997 and
has been Chief Financial Officer of the Company since 1994. He has
served the Company in various capacities since 1986.
Carl H. Lindner is Keith E. Lindner's father.
In December 1993, Great American Communications
Company, which subsequently changed its name to Citicasters Inc.,
completed a comprehensive financial restructuring which included
a prepackaged plan of reorganization filed in November of that
year under Chapter 11 of the Bankruptcy Code. Carl H. Lindner
and Fred J. Runk had been executive officers of that company
within two years before its bankruptcy reorganization.
Required Vote
_____________
The eight nominees receiving the highest number of
votes will be elected as directors. Abstentions (including
instructions to withhold authority to vote for one or more
nominees) and broker non-votes will be counted for purposes of
determining a quorum but will not be counted as votes cast in the
election of directors. There is no provision for cumulative
voting in the election of directors.
Chiquita has been informed that AFG intends to vote its
shares "FOR" all of the nominees.
THE BOARD OF DIRECTORS
______________________
During 1996, Chiquita's Board of Directors held four
meetings and took action by unanimous written consent four times.
Each incumbent director attended at least 75% of the aggregate of
the total number of meetings of the Board and of the committees
on which he or she served during 1996.
Committees of the Board
_______________________
Chiquita's Board of Directors has three standing
committees: an Executive Committee, an Audit Committee and a
Compensation Committee. The Board does not have a Nominating
Committee.
Executive Committee. Carl H. Lindner, Keith E. Lindner
and Ronald F. Walker are the members of the Company's Executive
Committee. Under New Jersey law and the Company's By-laws, the
Executive Committee is permitted to perform all of the functions
of the Board of Directors except: changes to the By-laws; changes
in directors; removal of officers; submission of matters to
shareholders which require shareholder action; and changes in
resolutions adopted by the Board which by their terms may be
changed only by the Board. During 1996, the Executive Committee
held no meetings but took action by unanimous written consent
nine times.
Audit Committee. Jean Head Sisco, William W. Verity
and Oliver W. Waddell are the members of the Audit Committee.
The functions of the Audit Committee include: reviewing
Chiquita's financial and accounting policies and its annual and
quarterly financial statements; meeting with the Company's
internal audit staff and independent auditors to review the scope
of the annual audit; reviewing the progress and results of the
audit and considering any recommendations made as a result of the
audit and management's response to such recommendations; and
recommending to the Board of Directors the selection of
Chiquita's independent auditors. During 1996, the Audit
Committee held four meetings with members of the Company's
management and internal audit staff and met with the Company's
independent auditors at all of those meetings.
Compensation Committee. The members of the Compensation Committee
are Jean Head Sisco, William W. Verity and Oliver W. Waddell. The
functions of the Compensation Committee include: evaluating the
performance and reviewing and approving all compensation of the
Company's executive officers and certain other designated senior
executives; establishing general compensation policies and standards
for evaluation of all other senior management; evaluating and monitoring
long-range planning for executive development and succession; and
administering the Company's 1986 Stock Option and Incentive Plan. The
Compensation Committee held four meetings during 1996.
Board Compensation
__________________
Directors who are not employees of the Company receive
an annual fee of $40,000 plus $1,500 for each Board meeting
attended. Additionally, Carl H. Lindner receives $15,000 per
year as Chairman of the Executive Committee; Jean Head Sisco
receives $15,000 per year as Chairman of the Audit Committee and
$7,500 per year as a member of the Compensation Committee;
William W. Verity and Oliver W. Waddell each receive $15,000 per
year as members of both the Audit and Compensation Committees.
Beginning in 1997, directors may defer from 10% to 100%
of their Board compensation for a term of 5 years, 10 years or
until death, disability or retirement, pursuant to the Deferred
Compensation Plan for Directors. Amounts deferred under this
plan earn interest at rates established each year depending upon
the length of deferral. In 1997, deferrals will earn interest at
an annual rate of 11% if deferred for 5 years and 13% if deferred
for 10 years or until death, disability or retirement.
Pursuant to the Company's 1986 Stock Option and
Incentive Plan, each non-employee director receives a non-qualified
stock option grant for 10,000 shares of the Company's
Common Stock on the date first elected a director and receives an
additional stock option grant for 10,000 shares each year
thereafter. All options awarded to non-employee directors have
an exercise price per share equal to the market price of the
Common Stock on the date of grant. The options have a 20-year
term and vest over a 10-year period, with 9% of the shares
exercisable on the date of grant and an additional 9% exercisable
on each anniversary of the grant date, except in the tenth year
when the remaining 10% become exercisable.
EXECUTIVE COMPENSATION
______________________
Summary Information
___________________
The following table summarizes the annual and long-term
compensation of the Chairman of the Board and Chief Executive
Officer and the four other most highly paid executive officers of
the Company (collectively, the "Named Executive Officers") for
the fiscal years 1996, 1995 and 1994. A report on executive
compensation by the Compensation Committee of the Board of
Directors appears on page 11 of this Proxy Statement.
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
__________________________
Long-Term
Compensation
____________
Annual Compensation Securities
_____________________________ Underlying All Other
Name and Bonus Stock Options Compensation
Principal Position Year Salary($)(1) ($)(1)(2) (#)(2) ($)(3)
___________________________ ____ ____________ _________ _____________ ____________
<S> <C> <C> <C> <C> <C>
Carl H. Lindner 1996 215,000(4) -0- -0- 4,527
Chairman of the Board and 1995 268,846(4) -0- -0- 1,902
Chief Executive Officer 1994 415,000(4) -0- -0- 4,452
Keith E. Lindner 1996 900,000 -0- -0- 20,698
Vice Chairman of 1995 935,000 -0- -0- 21,346
the Board 1994 1,030,000 -0- -0- 19,727
Steven G. Warshaw 1996 350,000 530,000 80,000 27,809
President, Chief 1995 350,000 450,000 75,000 15,685
Operating Officer and 1994 300,000 330,000 80,000 14,256
Chief Financial Officer
Robert F. Kistinger 1996 300,000 400,000 195,000(5) 38,417
President, Chiquita 1995 300,000 425,000 30,000 46,908
Banana Group 1994 300,000 250,000 30,000 59,053
Jos P. Stalenhoef 1996 250,000 175,000 13,200 32,515
Chief Transformation 1995 250,000 175,000 14,000 32,633
Officer-North America 1994 250,000 157,500 15,000 26,772
<FN>
(1) Includes amounts deferred under the Company's Deferred
Compensation Plan.
(2) Bonus awards and stock option grants were based on 1996 performance
even though most awards were received in 1997.
(3) Amounts disclosed for 1996 are comprised of the following:
(a) Company contributions to the Savings Plan: Carl H. Lindner,
$2,625; Keith E. Lindner, $15,750; Steven G. Warshaw, $12,150;
Robert F. Kistinger, $6,413; and Jos P. Stalenhoef, $10,993.
(b) Company matching contributions on excess deferrals from
the Savings Plan to the Deferred Compensation Plan as a result
of IRS limitations on the amount which can be deferred under a
401(k) savings plan: Steven G. Warshaw, $10,385; and Jos P.
Stalenhoef, $6,950.
(c) Above market interest (assuming the highest rate payable under
the Company's Deferred Compensation Plan, which has a graduated
interest schedule based upon the length of deferral) calculated
(but not paid or currently payable) on deferred compensation:
Keith E. Lindner, $4,870; Steven G. Warshaw, $3,198; Robert F.
Kistinger, $29,766; and Jos P. Stalenhoef, $14,176.
(d) Term life insurance premiums paid by the Company: Carl H.
Lindner, $1,902; Keith E. Lindner, $78; Steven G. Warshaw,
$2,076; Robert F. Kistinger, $2,238; and Jos P. Stalenhoef,
$396.
(4) Includes $15,000 received as Chairman of the Executive
Committee.
(5) See footnote 5 to the table under the caption "Option Grants
for 1996."
</FN>
</TABLE>
Stock Option Grants
___________________
The following table contains information concerning
grants of stock options to the Named Executive Officers under the
Company's 1986 Stock Option and Incentive Plan.
<TABLE>
<CAPTION>
OPTION GRANTS FOR 1996
Individual Grants
_____________________________________________
Number of
Securities % of Total Grant
Underlying Options Exercise Date
Options Granted to or Base Present
Granted Employees Price Expiration Value
Name (#)(1) for 1996 ($/Sh)(2) Date(3) ($)(4)
___________________ __________ __________ _________ __________ __________
<S> <C> <C> <C> <C> <C>
Carl H. Lindner -0- --- --- --- ---
Keith E. Lindner -0- --- --- --- ---
Steven G. Warshaw 80,000 4.0% 13.6875 1/28/17 345,000
Robert F. Kistinger 145,000(5) 7.2% 13.6875 5/07/06 287,000(6)
50,000 2.5% 13.6875 1/28/17 215,000
Jos P. Stalenhoef 13,200 0.7% 13.6875 1/28/17 57,000
<FN>
(1) Unless indicated otherwise, all options were granted
January 28, 1997, based on performance in 1996. Options
vest over a 10-year period with 9% immediately exercisable
on the date of grant and an additional 9% exercisable on
each anniversary of the grant date thereafter until
January 28, 2007 when the remaining 10% will be exercisable.
In the event of death, disability or retirement, options are
fully exercisable by optionee or optionee's legal
representative for one year following such event or until
the normal expiration date of the option, whichever occurs
first.
(2) Represents the market price of a share of Chiquita Common
Stock on the date of grant (calculated as the average of
the highest and lowest selling prices on the New York Stock
Exchange).
(3) Subject to earlier termination in case of termination of
employment.
(4) The grant date present value was calculated using the
Black-Scholes option pricing model. The assumptions used
in the model included (a) an expected Chiquita stock price
volatility of 36%; (b) a risk-free interest rate of 6.6%;
(c) a dividend yield of 1.5%; and (d) an expected option
life of 8 years. In addition, the Black-Scholes model
output was modified by a discount to reflect the risk of
forfeiture (6% per year probability) due to restrictions on
exercise of the option in accordance with the 10-year
vesting provisions. Whether the assumptions used will prove
accurate cannot be known at the date of grant. The actual
value, if any, will depend on the market price of the
Company's Common Stock on the date of exercise.
(5) Option was granted May 7, 1996 and vests over a 3-year
period with shares becoming exercisable on the following
dates: 45,000 shares on April 8, 1997; 27,500 shares on
January 9, 1998; and 36,250 shares on May 7 in 1998 and
1999. The total number of shares exercisable under this
option will automatically be reduced by the total number of
shares, if any, purchased by Mr. Kistinger under either of
two previously granted options having an exercise price of
$13.333 per share, one of which is for 45,000 shares and
expires on April 7, 1997 and the other of which is for
105,000 shares and expires on January 8, 1998.
(6) The grant date present value was calculated using the same
assumptions noted in footnote 4 above, except that (a) the
expected option life was 5 years, and (b) the value was reduced
by the estimated fair value as of May 7, 1996 of the two
previously granted options described in footnote 5 above which
expire in 1997 and 1998.
</FN>
</TABLE>
Option Exercises, Holdings and Year-End Values
______________________________________________
The following table summarizes the value of all
outstanding options for the Named Executive Officers as of
December 31, 1996.
<TABLE>
<CAPTION>
AGGREGATE OPTION EXERCISES IN 1996 AND 1996 YEAR-END OPTION VALUE(1)
Number of Securities
Shares Underlying Unexercised Value of Unexercised
Acquired Options at December 31, In-the-Money Options at
on Value 1996(#)(1) December 31, 1996 ($)(1)(2)
Exercise Realized __________________________ __________________________
Name (#) ($) Exercisable Unexercisable Exercisable Unexercisable
___________________ ________ ________ ___________ _____________ ___________ _____________
<S> <C> <C> <C> <C> <C> <C>
Carl H. Lindner -0- -0- 10,800 9,200 -0- -0-
Keith E. Lindner -0- -0- -0- -0- -0- -0-
Steven G. Warshaw -0- -0- 137,850 237,150 70,200 124,800
Robert F. Kistinger 2,000 10,041 248,190 129,810(3) 52,650 93,600
Jos P. Stalenhoef -0- -0- 77,670 107,480 52,650 93,600
<FN>
(1) Does not include options granted in January 1997 which were
based on performance in 1996.
(2) Value is calculated as the difference between the market
price of the Common Stock on December 31, 1996 ($12.75 per
share) and the exercise prices of the unexercised options.
(3) Does not include 145,000 shares covered by a currently
unexercisable option granted on May 7, 1996 which is
described under footnote 5 to the table under the caption
"Option Grants for 1996" because the number of such shares
will be automatically reduced on a share-for-share basis to
the extent that previously granted options for 150,000
shares are exercised. The 150,000 shares covered by such
previously granted options are included in the exercisable
column of this table.
</FN>
</TABLE>
REPORT OF COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
__________________________________________________________
The Compensation Committee of the Board of Directors
(the "Committee") is composed of Jean Head Sisco, William W.
Verity and Oliver W. Waddell, who are independent outside
directors. The Committee is charged with responsibility for
reviewing the performance and establishing the individual
compensation of the executive officers named in the Summary
Compensation Table ("Executive Officers"), as well as approving
the compensation of other key executives. The Committee also
establishes general compensation policies and standards for
reviewing management performance. In carrying out this function,
the Committee ensures that the Company's compensation philosophy
is appropriate to its business and is implemented effectively
through its various policies and programs.
Compensation Philosophy
_______________________
The Company's compensation philosophy is to motivate
and reward the achievement of long-term growth in shareholder
value. To achieve this objective, the Company has adopted a
program called the Total Compensation System which is designed
to: (i) base cash and non-cash rewards on both individual and
Company performance; (ii) encourage stock ownership in order to
align the interests of management with those of shareholders; and
(iii) emphasize the importance of management's commitment to the
long-term success of the Company.
The program has three basic elements of compensation --
base salary, bonus awards and stock options -- which are designed
to attract, motivate and retain dedicated, talented people who
are capable of achieving the Company's long-term objectives.
These three elements of total compensation are reviewed annually
in connection with the appraisal of each manager's performance
against pre-established goals and objectives as well as the
Company's performance during the year. The program is used to
establish the total compensation of managers at many levels of
the Company, including each of the Executive Officers, except for
the Chief Executive Officer ("CEO") whose compensation is
discussed below.
Compensation of Executive Officers Other Than CEO
_________________________________________________
The primary factors considered by the Committee in
establishing the total annual cash compensation (salary plus
bonus award) of each Executive Officer except for the CEO are:
(i) the responsibilities of the position; (ii) the executive's
potential impact on the annual financial and longer-term
strategic results of the Company; (iii) the long-term
contributions of the executive; and (iv) the performance against
pre-established annual objectives which emphasize business unit
and/or total Company financial results.
Base Salary. Base salaries are established according
to each executive's position, responsibilities and long-term
contribution. Base salaries are not necessarily adjusted
annually but are adjusted only when the Committee, after
soliciting the opinions of senior management, judges that an
Executive Officer's responsibilities and/or long-term
contribution have changed sufficiently to warrant a change in
base salary.
Bonus Awards. The Executive Officers' bonus awards are
determined in accordance with the Company's Total Compensation
Review Plan (the "TCR"), an annual cash bonus incentive plan
which covers most management positions. Under the TCR, each
management position has an annual target bonus which is expressed
as a percentage of base salary and is principally determined
according to the position's potential impact on Company results.
Base salary and target bonus are coordinated so that the combined
amount provides a total annual cash compensation level which, in
the Committee's judgment, is appropriate for the position and the
individual Executive Officer.
Bonus awards are determined by measuring the Executive
Officer's performance against annual objectives in the following
three categories (the relative weight assigned to each category
is indicated in parenthesis): (i) Team Profit Achievement
Objectives (40%), which include return on investment or similar
objectives for the relevant business unit(s); (ii) Individual
Profit Achievement Objectives (40%), which include cost, revenue,
volume, and quality-related objectives appropriate to the
individual; and (iii) Management Achievement, Strategy and
Organization Development Objectives (20%), which include
development and implementation of business strategies and
organizational effectiveness programs.
Accomplishment of each objective is rated
quantitatively and a weighted average overall performance rating
is calculated. The overall performance rating indicates a range
of percentages of target bonus for use in determining the actual
bonus. For 1996, the actual bonus was approved by the Committee
after consultation with and review of the recommendations of the
President and Chief Operating Officer and the Executive Vice
President, Chief Administrative Officer and Chief Financial
Officer. Actual bonus awards may range from 0% of the target
bonus (for overall performance which does not meet annual
objectives) to 200% of target (for overall performance which far
exceeds objectives). The TCR provides for payout of
approximately 100% of target bonus if the overall annual
performance objectives are met.
Stock Options. Stock options are used to reward past
performance and motivate future performance, especially long-term
performance. Most stock options vest over a 10-year period with
9% exercisable immediately upon the grant date and an additional
9% exercisable on each anniversary of the grant until the tenth
anniversary, when the final 10% becomes exercisable. The
Company's standard options have a 20-year exercise period and are
priced at the fair market value of the underlying Common Stock
on the date of the grant. The unusually long vesting and exercise
periods and market pricing are specifically intended to motivate
management decisions which will be in the shareholders' best
long-term interests and will assist in the retention of executive
talent.
Targets for stock option awards are based on the
capital value of the grant (the number of stock options granted
multiplied by the market price of the option) and are established
as a percentage of the targeted total annual cash compensation
(annual salary plus target bonus). Relating stock option award
targets to the capital investment required to purchase an
equivalent number of shares of stock is consistent with the
Company's philosophy that management should be rewarded when it
is successful in increasing the value of the Company's
securities. Stock option award targets increase as the
responsibility, base salary and target bonus of a position
increase. The Company believes that market comparisons are not
meaningful for the Company's stock option award targets because
of the unusually long vesting and exercise periods of the
Company's options.
Actual stock option awards may be larger or smaller
than award targets depending on a number of factors which are
considered by the Committee, including: the Executive Officer's
performance against his annual objectives (described above under
Bonus Awards); changes in responsibility; future potential;
considerations relating to management succession; and the number
of stock options awarded to the Executive Officer in prior years.
Compensation of Chairman and Chief Executive Officer for 1996
_____________________________________________________________
At the request of Mr. Carl H. Lindner, the Compensation
Committee did not increase his base salary during 1996 and did
not award him a bonus or a stock option. Mr. Lindner's base
salary had been reduced from $400,000 to $200,000 in accordance
with his request in April 1995. In establishing Mr. Lindner's
compensation for 1996, as in years past, the Committee considered
the fact that Mr. Lindner had significant responsibilities as an
executive officer of American Financial Group, Inc. and its
subsidiaries and affiliates. Although Mr. Lindner devoted time
to matters more directly related to other enterprises, the
Committee believes his total compensation from the Company for
1996 was appropriate and reasonable. This judgment is based on
the Committee's conclusion that Mr. Lindner has fully and
effectively discharged the responsibilities of his position with
the Company to the Company's substantial benefit. Moreover, the
Committee believes that Mr. Lindner's strong leadership, guidance
and direction to the Company since he became Chairman and Chief
Executive Officer in 1984 have contributed to long-term growth in
shareholder value, as demonstrated by the graph on page 16
showing the cumulative total shareholder return over the 12-year
period from 1984 to 1996.
Compensation of Vice Chairman for 1996
______________________________________
The 1996 bonus target for Mr. Keith E. Lindner, who was
President and Chief Operating Officer of the Company until his
election as Vice Chairman of the Board of Directors in March
1997, was established by the Committee at 100% of his base salary
in consideration of his potential impact on the overall
performance of the Company. Although the Committee believed that
the award of a 1996 bonus for Mr. Lindner would have been
appropriate, particularly in view of the Company's improvement in
the profitability of its core operations, the increase in cash
flow and its strengthened balance sheet, the Committee acceded to
Mr. Lindner's request that his total annual cash compensation
(base salary plus bonus) for 1996 not exceed $900,000, the level
at which the Committee had set his base salary in 1995 and had
maintained in 1996. Consequently, the Committee did not award
Mr. Lindner a bonus for 1996. Also in accordance with
Mr. Lindner's request, the Committee did not grant him any stock
options for 1996.
Compensation of Other Executive Officers for 1996
_________________________________________________
The base salaries of Steven G. Warshaw, Robert F.
Kistinger and Jos P. Stalenhoef remained the same in 1996 as in
1995. The 1996 TCR target bonuses for these Executive Officers
ranged from 70% to 100% of base salary. For 1996, each Executive
Officer met his particular TCR Team Profit Achievement
Objectives, and met or exceeded both his TCR Individual Profit
Achievement Objectives and his Management Achievement, Strategy
and Organization Development Objectives. While the objectives
and achievements were specific to each individual, they included:
improvements in the results of core operations; achievement of
organizational efficiencies for the Company's banana business;
development and implementation of strategic initiatives to reduce
costs and increase long-term growth in the banana business;
refinancing of long-term debt to reduce interest expense; and
entering into an unsecured revolving credit facility to lower
cash balances and enhance future ability to reduce debt and
interest costs. The performance ratings for these individuals
produced 1996 bonuses ranging from 100% to 189% of target.
The Executive Officers received stock options based on
1996 performance totaling 288,200 shares, compared to the 119,000
shares they received for performance in 1995. The awards were
based on a number of factors specific to each individual,
including: the target award level; the individual's specific
contributions during 1996 as well as his long-term contributions
to the Company; any increase or significant change in
responsibilities; and the total number of shares covered by
previous grants.
The Committee did not review or consider compensation
surveys when determining the 1996 bonus and stock option awards
to Executive Officers.
Tax Deductibility of Executive Compensation
___________________________________________
Section 162(m) of the Internal Revenue Code prohibits
the Company from taking an income tax deduction for any
compensation paid to any of the Executive Officers in excess of
$1 million per year unless the compensation qualifies as
performance-based pay.
Compensation received from the exercise of stock
options awarded under the Company's 1986 Stock Option and
Incentive Plan qualifies as performance-based compensation and is
fully deductible by the Company. While the Company's TCR Bonus
Plan does not meet all of the requirements for deductibility, the
compensation paid to the Executive Officers in 1996 is fully
deductible because no Executive Officer was paid in excess of $1
million.
The Committee believes that it would not be in the best
interests of the Company or its shareholders to change its TCR
Bonus Plan to meet the 162(m) requirements for deductibility at
this time because it believes the TCR Bonus Plan is an effective
means of delivering performance-based pay and it is the same plan
used to determine the compensation of most managers within the
Company. Thus, the Committee will continue to use the current
system of managing the compensation of Executive Officers in 1997
but will continue to study the future consequences of compliance
with Section 162(m).
Compensation Committee:
Jean Head Sisco
William W. Verity
Oliver W. Waddell
COMMON STOCK PERFORMANCE GRAPHS
_______________________________
The following performance graphs compare Chiquita's
cumulative shareholder returns over a 5-year and 12-year period,
assuming $100 invested at December 31, 1991 and December 31,
1984, respectively, in Chiquita Common Stock, in the Standard &
Poor's 500 Stock Index, and in an industry group index of 16
other fruit and vegetable companies. The 12-year graph compares
Chiquita's performance over the entire period since 1984, when
the current management assumed responsibility for managing the
Company. The calculation of total shareholder return is based on
the increase in the price of the stock over the relevant period
and assumes the reinvestment of all dividends. In addition,
total return was weighted according to the market capitalization
of each company at the beginning of each period.
The industry group is composed of: Dole Food Co.,
Inc.; Geest PLC; Fyffes PLC; The Albert Fisher Group PLC; Perkins
Foods; Stokely USA, Inc.; Seneca Foods Corporation; United Foods,
Inc.; Dean Foods Co.; Orange-Co., Inc.; Del Monte Royal Foods
Ltd.; Sylvan Foods Holdings, Inc.; Northland Cranberries, Inc.;
Odwalla, Inc.; Fresh America Corporation; and Unimark Group, Inc.
Two new companies (Fresh America Corporation and Unimark Group,
Inc.) were added to the industry group this year to provide
further representation of the performance of companies with
businesses and product lines similar to those of Chiquita. The
cumulative total return over the 5-year and 12-year periods for
the industry group previously used would have been 90 and 259,
respectively, as compared to 90 and 257 for the new industry
group.
<TABLE>
<CAPTION>
CHIQUITA BRANDS INTERNATIONAL, INC.
Cumulative Total Returns (1991-1996)
____________________________________
12/91 12/92 12/93 12/94 12/95 12/96
_____ _____ _____ _____ _____ _____
<S> <C> <C> <C> <C> <C> <C>
Chiquita 100 45 31 37 38 36
S&P 500 100 108 118 120 165 199
Fruit & Veg. Related 100 89 90 76 86 90
</TABLE>
<TABLE>
<CAPTION>
CHIQUITA BRANDS INTERNATIONAL, INC.
Cumulative Total Returns (1984-1996)
12/84 12/85 12/86 12/87 12/88 12/89 12/90 12/91 12/92 12/93 12/94 12/95 12/96
_____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____ _____
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Chiquita 100 259 311 431 470 505 944 1,196 534 369 442 453 426
S&P 500 100 132 156 164 191 252 244 318 343 377 382 526 632
Fruit & Veg. Related 100 127 154 170 213 264 283 272 209 222 197 231 257
</TABLE>
CERTAIN TRANSACTIONS
____________________
The Company estimates that its subsidiaries paid
approximately $110,000 for advertising time on radio and
television stations owned by Citicasters Inc., an AFG affiliate,
during the first nine months of 1996. Citicasters Inc. was sold
by AFG in September 1996.
In 1996, the Company purchased airline tickets and
travel-related services totaling approximately $3.5 million
through Provident Travel Corporation, a travel agency subsidiary
of AFG until March of 1997 when it was sold. The total amount
paid to the travel agency included the amount ultimately paid to
the airlines or other service providers.
In 1996, the Company received net payments of
approximately $595,000 from AAG for the sublease of office space,
the rental of office furniture and the use of the Company's
cafeteria. The payments received from AAG are net of $114,000
paid by Chiquita to AAG as consideration for AAG's early
cancellation of the sublease. In September 1996, Chiquita and
AAG terminated the base lease and sublease in exchange for new,
separate long-term leases. As part of the transaction, Chiquita
agreed to reimburse AAG for the difference between the rent under
the new lease and the rent under the sublease through April 1998,
the original expiration date of the sublease. Chiquita will
reimburse AAG an additional $765,000 through April 1998.
During 1996, the Company paid approximately $60,000 to
The Cincinnatian Hotel, which is owned by a subsidiary of AFG,
for room rentals and use of meeting facilities.
Chiquita believes that the financial terms of the
transactions described above were fair to Chiquita and were
comparable to those that would apply to unrelated parties.
INDEPENDENT AUDITORS
____________________
The accounting firm of Ernst & Young LLP served as the
Company's independent auditors for 1996 and also served as
independent auditors for AFG and its subsidiaries. One or more
representatives of Ernst & Young LLP will attend the Annual
Meeting and will be given the opportunity to comment, if they
desire, and to respond to appropriate questions that may be asked
by shareholders. No auditor has yet been selected for the
current year, since it is Chiquita's practice not to select
independent auditors prior to the Annual Meeting.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
_______________________________________________________
Section 16(a) of the Securities Exchange Act of 1934
requires the Company's executive officers and directors, and
persons who beneficially own more than 10% of the Company's
equity securities, to file reports of security ownership and
changes in such ownership with the Securities and Exchange
Commission (the "SEC") and the New York Stock Exchange.
Officers, directors and beneficial owners of more than 10% of the
Company's equity securities also are required by SEC regulations
to furnish the Company with copies of all Section 16(a) forms
they file.
Based upon a review of copies of such forms and written
representations from its executive officers and directors, the
Company believes that all Section 16(a) filing requirements were
complied with during and for 1996.
SOLICITATION OF PROXIES
_______________________
Chiquita will bear the cost of soliciting proxies and
will reimburse brokers, custodians, nominees and fiduciaries for
their charges and expenses in forwarding proxy material to the
beneficial owners of shares held by such persons. Solicitation
of proxies will be made by management of the Company, without
additional compensation, through the mail, in person, or by
telephone, telegraph or facsimile. The Company has also retained
Kissel-Blake, Inc., New York, New York to assist in the
distribution and solicitation of proxies for a fee of $4,500 plus
reasonable out-of-pocket expenses.
ANNUAL REPORT
_____________
The Company's annual report to shareholders, including
financial statements, for the fiscal year ended December 31, 1996
is being mailed with this Proxy Statement.
SHAREHOLDER PROPOSALS FOR NEXT ANNUAL MEETING
_____________________________________________
Shareholder proposals for the 1998 Annual Meeting of
Shareholders must be received in writing by the Secretary of the
Company at the Company's executive offices by December 1, 1997 in
order to be considered for inclusion in next year's proxy materials.
MISCELLANEOUS
_____________
The Company will send, without charge, a copy of the
Company's current annual report on Form 10-K to any holder of
Common Stock who makes a request in writing to Joseph W. Hagin
II, Vice President, Corporate Affairs, Chiquita Brands
International, Inc., Chiquita Center, 250 East Fifth Street,
Cincinnati, Ohio 45202.
By order of the Board of Directors,
Robert W. Olson
Senior Vice President, General Counsel
and Secretary
Cincinnati, Ohio
March 31, 1997
<PAGE>
CHIQUITA BRANDS INTERNATIONAL, INC.
Proxy for Annual Meeting
Registration Name and Address
P
R
O
X
Y
The undersigned hereby appoints Keith E. Lindner and Robert W.
Olson, or either of them, proxies of the undersigned, each with
the power to appoint his substitute, and authorizes them to
represent and to vote, as designated below, all shares of Common
Stock which the undersigned would be entitled to vote at the
Annual Meeting of Shareholders of Chiquita Brands International,
Inc. to be held May 14, 1997 at 10:00 a.m., and any adjournment
of such meeting.
The Board of Directors recommends a vote FOR the following:
1. Election of directors:
[ ] FOR AUTHORITY to elect the [ ] WITHHOLD AUTHORITY
nominees listed below (except to vote for all nominees
those whose names have been listed below
crossed out)
Carl H. Lindner Keith E. Lindner
Fred J. Runk Jean Head Sisco
William W. Verity Oliver W. Waddell
Ronald F. Walker Steven G. Warshaw
The proxies are further authorized in their discretion to vote upon such
other business as may properly come before the meeting and any adjournment
of the meeting.
Dated: _________, 1997 Signature: ___________________________________
Signature: ___________________________________
(if held Important: Please sign exactly as
jointly) name appears on this form indicating,
where proper, official position or
representative capacity. In case
of joint holders, all should sign.
TO VOTE YOUR SHARES, YOU MUST MARK, SIGN, DATE AND RETURN THIS PROXY FORM.
This proxy, when properly signed, will be voted in the manner directed by
the above signed shareholder(s). A PROPERLY SIGNED PROXY THAT GIVES NO
DIRECTION WILL BE VOTED FOR THE ELECTION OF ALL NOMINEES FOR DIRECTOR.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
