CAL-MAINE FOODS, INC.
NOTICE OF ANNUAL MEETING
October 8, 1997
TO THE SHAREHOLDERS:
The Annual Meeting of the shareholders of Cal-Maine Foods,
Inc. will be held at the corporate offices of Cal-Maine Foods, Inc.
at 3320 Woodrow Wilson Drive, Jackson, Mississippi 39207, at 10:00
a.m. (Local Time), on Wednesday, October 8, 1997, to consider and
vote on:
1. The election of directors to serve on the Board of
Directors of Cal-Maine Foods, Inc. for the ensuing year.
2. The ratification of the appointment of Ernst & Young LLP
as independent auditors for fiscal year 1998.
3. Such other matters as may properly come before the Annual
Meeting or any adjournments thereof.
August 27, 1997 has been fixed as the record date for
determination of shareholders entitled to vote at the Annual
Meeting and to receive notice thereof.
The directors sincerely desire your presence at the meeting.
However, so that we may be sure your vote will be included, please
sign, date and return the enclosed proxy card promptly. A self-
addressed, postage-paid return envelope is enclosed for your
convenience.
<TABLE>
<S> <C>
FOR THE BOARD OF DIRECTORS
s/Bobby J. Raines
_________________________
BOBBY J. RAINES
SECRETARY
</TABLE>
DATED: September 8, 1997.
SHAREHOLDERS ARE URGED TO VOTE BY DATING, SIGNING AND RETURNING THE
ENCLOSED PROXY CARD IN THE ENCLOSED ENVELOPE TO WHICH NO POSTAGE
NEED BE AFFIXED IF MAILED IN THE UNITED STATES.
SCHEDULE 14A
INFORMATION REQUIRED IN PROXY STATEMENT
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
Section 240.14a-12
CAL-MAINE FOODS, INC.
- --------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
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(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)(4) and 0-
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(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(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
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/ / 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:
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(2) Form, Schedule or Registration Statement No.:
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(4) Date Filed:
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CAL-MAINE FOODS, INC.
3320 Woodrow Wilson Drive
Jackson, Mississippi 39207
PROXY STATEMENT FOR ANNUAL MEETING
OF SHAREHOLDERS TO BE HELD OCTOBER 8, 1997
The information set forth in this proxy statement is furnished
in connection with the Annual Meeting of Shareholders of Cal-Maine
Foods, Inc. ("Cal-Maine" or the "Company") to be held on Wednesday,
October 8, 1997, at 10:00 a.m., Jackson time, at the Company's
headquarters, 3320 Woodrow Wilson Drive, Jackson, Mississippi. A
copy of the Company's annual report to shareholders for the fiscal
year ended May 31, 1997, accompanies this proxy statement.
Additional copies of the annual report, notice, proxy statement,
and proxy card may be obtained from the Company's Secretary, Bobby
J. Raines, Post Office Box 2960, Jackson, Mississippi 39207. The
Company's telephone number is 601/948-6813.
The enclosed proxy is solicited by the Board of Directors of
the Company. The proxy may be revoked by a shareholder at any time
before it is voted by filing with the Company's Secretary a written
revocation or a duly executed proxy bearing a later date. The proxy
also may be revoked by a shareholder attending the meeting,
withdrawing the proxy, and voting in person.
All expenses incurred in connection with the solicitation of
proxies will be paid by the Company. In addition to the
solicitations of proxies by mail, directors, officers, and regular
employees of the Company may solicit proxies in person or by
telephone. The Company will, upon request, reimburse banks,
brokerage houses and other institutions, and fiduciaries for their
expenses in forwarding proxy material to their principals.
This proxy statement and the enclosed form of proxy are first
being mailed to shareholders on or about September 8, 1997.
Shareholders of record at the close of business on August 27, 1997,
are eligible to vote at the Annual Meeting. As of the record date,
11,994,388 shares of the Company's Common Stock were outstanding,
and 1,200,000 shares of the Company's Class A Common Stock were
outstanding. Each share of Common Stock is entitled to one vote on
each matter to be considered at the Annual Meeting. Each share of
Class A Common Stock is entitled to ten votes on each such matter.
Both the shares of Common Stock and the shares of Class A Common
Stock have the right of cumulative voting in the election of
directors. Cumulative voting means that each shareholder will be
entitled to cast as many votes as he or she has the right to cast
(before cumulating votes), multiplied by the number of directors to
be elected. All such votes may be cast for a single nominee or may
be distributed among the nominees to be voted for as the
shareholder sees fit. To exercise cumulative voting rights by
Proxy, a shareholder must clearly designate the number of votes to
be cast for any given nominee.
Shares represented by a properly executed and returned proxy
card will be voted at the Annual Meeting in accordance with the
instructions indicated thereon. If no instructions are indicated,
the proxy will be voted for the election of nine nominees to serve
as directors of the Company and for the ratification of the
appointment of Ernst & Young, LLP as the Company's independent
auditors for the fiscal year ending May 30, 1998.
The election of directors requires a plurality of the votes
cast and the ratification of the appointment of independent
auditors requires the affirmative vote of a majority of the votes
cast at the meeting. For purposes of determining the number of
votes cast with respect to a particular matter, only those cast
"For" or "Against" are included. Abstentions and broker non-votes
are counted only for purposes of determining whether a quorum is
present at the meeting.
In accordance with the Company's bylaws and Delaware law, the
Board will appoint two inspectors of election. The inspectors will
take charge of, and will count, the votes and ballots cast at the
Annual Meeting and will make a written report on their
determination.
OWNERSHIP OF VOTING SECURITIES BY CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth information as to the
beneficial ownership of the Company's Common Stock as of August 1,
1997, by (i) each person known by the Company to beneficially own
more than 5% of the class outstanding and (ii) each director, each
nominee, each executive officer named in the Summary Compensation
Table (see "Compensation of Executive Officers and Directors") and
by all directors and officers as a group. Each executive officer
also is a director of the Company.
<TABLE>
Common Stock
------------
<S> <C> <C> <C>
Name of Beneficial Number of Percent of Class Percent of Total
Owner(2) Shares(1)<PAGE>
Voting Power
- ----------------- ---------- ----------------- -----------------
Fred R. Adams, Jr. (4) 5,226,663 42.5% 70.9%
Cal-Maine Foods, Inc.
Employee Stock
Ownership Plan 3,654,642 29.7% 15.0%
Richard K. Looper 323,097(6) 2.6% 1.3%
Adolphus B. Baker 257,240(7) 2.1% 1.1%
Bobby J. Raines 297,973(8) 2.4% 1.2%
Jack B. Self 122,012(9) 1.0% *
Joe M. Wyatt 179,428(10) 1.5% *
Charles F. Collins 103,917(11) * *
W. D. (Jack) Cox --- * *
R. Faser Triplett, M.D. 8,000 * *
All directors and executive
officers as a group (nine
persons) (12) 6,510,330 53.0% 76.2%
______________________
* Less than 1%.
</TABLE>
(1) The information as to beneficial ownership is based on
information known to the Company or statements furnished to
the Company by the beneficial owners. As used in this table,
"beneficial ownership" means the sole or shared power to vote
or to direct the voting of a security, or the sole or shared
investment power with respect to a security (i.e. the power to
dispose of, or to direct the disposition of a security). For
purposes of this table, a person is deemed as of any date to
have "beneficial ownership" of any security that such person
has the right to acquire within 60 days after such date, such
as under the Company's 1993 Stock Option Plan.
(2) The address of each person, except W.D. Cox and R. Faser
Triplett, M.D., is Cal-Maine Foods, Inc., 3320 Woodrow Wilson
Drive (Post Office Box 2960), Jackson, Mississippi 39207. Mr.
Cox's address is 1161 Oak River Road, Memphis, Tennessee 39120
and Dr. Triplett's address is 940 North State Street, Jackson,
Mississippi 39202.
(3) Percent of total voting power is based on the total votes to
which the Common Stock (one vote per share) and Class A Common
Stock (ten votes per share) are entitled. Mr. Adams
beneficially owns 100% of the Class A Common Stock.
(4) The number of shares shown in the table include 344,400 shares
of Common Stock owned by Mr. Adams' spouse and 127,200 shares
pledged to a bank to secure a promissory note obligation in
relation to which the Company has a repurchase obligation (See
"Certain Relationships and Related Transactions" under
"Election of Directors"). The Class A Common Stock is
convertible on a shares-for-share basis into shares of Common
Stock, but such Class A shares are not included in the table,
except as indicated in Note (3) above.
(5) Includes 284,148 shares accumulated under the Cal-Maine Foods,
Inc. Employee Stock Ownership Plan ("ESOP").
(6) Includes 101,403 shares accumulated under ESOP and 96,000
shares subject to stock options exercisable within 60 days.
(7) Includes 38,400 shares subject to stock options exercisable
within 60 days and 67,257 shares owned by Mr. Baker's spouse
separately and as custodian for their children as to which Mr.
Baker disclaims any beneficial ownership, and 23,921 shares
accumulated under the ESOP.
(8) Includes 201,762 shares accumulated under the ESOP, and 65,800
shares subject to stock options exercisable within 60 days.
(9) Includes 36,612 shares accumulated under the ESOP and 38,400
shares subject to stock options exercisable within 60 days.
(10) Includes 139,828 shares accumulated under the ESOP and 38,400
shares subject to stock options exercisable within 60 days.
(11) Includes 65,517 shares accumulated under the ESOP and 38,400
shares subject to stock options exercisable within 60 days.
(12) Includes shares as to which Messrs. Adams and Baker disclaim
any beneficial ownership. See Notes (4) and (8) above.
The shares of Common Stock accumulated in the ESOP, as
indicated in Notes (5) through (11) above, also are included in the
3,654,642 shares shown in the table as owned by the ESOP.
ELECTION OF DIRECTORS
The Company's bylaws provide that the number of directors
shall be fixed by resolution of the Board of Directors and that the
number may not be less than three nor more than 15. Pursuant to the
bylaws, the Board of Directors has fixed the number of directors at
nine. Unless otherwise specified, proxies will be voted FOR the
election of the nine nominees named below to serve until the next
annual meeting of shareholders and until their successors are
elected and qualified. If, at the time of the meeting, any of the
nominees named below is unable or declines to serve as director
(which is not anticipated), the proxies will be voted for the
election of such other person or persons as the Board of Directors
may designate in their discretion. The directors recommend a vote
FOR the nine nominees listed below. All nominees presently serve as
directors of the Company.
Nominees for Director
The table below sets forth certain information regarding the
nominees for election to the Board of Directors:
<TABLE>
<S> <C> <C>
Name Age Tenure and Business Experience
- --------- ---- ------------------------------
Fred R. Adams,Jr. (1) (3) 65 Fred R. Adams, Jr. has served as the
Chairman of the Board Chief Executive Officer and director
of Directors and Chief of the Company since its formation in
Executive Officer 1969 and as the Chairman of its Board
of Directors since 1982. He is a
director and past chairman of
National Egg Company, United Egg
Producers, Mississippi Poultry
Association, U.S. Egg Marketers,
Inc., and Egg Clearinghouse, Inc.
Mr. Adams is the father-in-law of Mr.
Baker.
Richard K. Looper (1) 70 Richard K. Looper served as President
Vice Chairman of the and Chief Operating Officer of the
Board of Directors Company from 1983 to January 1997.
Previously, he had served as
Executive Vice President of the
Company since 1982 and was originally
employed by the Company in 1974. Mr.
Looper is a past chairman of the
American Egg Board and U.S. Egg
Marketers, Inc. He has served as a
director of the Company since 1982.
Adolphus B.Baker (1) 40 Adolphus B. Baker was elected
President and Chief President and Chief Operating Officer
Operating Officer in January 1997. He was serving as
Vice President and Director of
Marketing of the Company when elected
President. Previously, he had served
as Assistant to the President since
1987 and has been employed by the
Company since 1986. Mr. Baker is a
member of the American Egg Board,
chairman of Mississippi Poultry
Association, and is a past chairman
of Egg Clearinghouse, Inc. He has
been a director of the Company since
1991. Mr. Baker is Mr. Adams' son-
in-law.
Bobby J. Raines (1) (2) 64 Bobby J. Raines has served as Vice
President, Chief Financial President, Chief Financial Officer,
Officer, Treasurer, Treasurer and Secretary of the
Secretary and Director Company since 1972. Previously, he
had handled various operational
responsibilities and has been
employed by the Company since its
formation in 1969. He has served as
a director of the Company since 1982.
Jack B. Self, Vice 67 Jack B. Self has been Vice
President/Operations and President/Operations and Production
Production and Direction of the Company since 1977. He has
served as a director of the Company
since 1983.
Joe M. Wyatt 58 Joe M. Wyatt has been Vice
Vice President/Feed Mill President/Feed Mill Division since
Division and Director 1977 and has been employed by the
Company since its formation in 1969.
He has served as a director of the
Company since 1983.
Charles F. Collins 53 Charles F. Collins has served as Vice
Vice President, Controller President and Controller of the
and Director Company since 1978. He has served as
a director of the Company since 1983.
He has been employed by the Company
since 1969.
W. D. (Jack) Cox (2) (3) 71 W.D. (Jack) Cox has served as a director
Director of the Company since
September 1996. Mr. Cox has been a
consultant to various food
companies and a major farm implement
company since October 1990. Prior
thereto, he served as Vice President for
vegetable oil procurement at Kraft, Inc.
("Kraft"), and was a consultant to
offshore and Canadian locations of Kraft's
facilities. In the early
1980s, Mr. Cox was Vice President for
commodities and ingredients
of Nabisco Brands, Inc. From 1970 to
1972 Mr. Cox was employed
by the Company as Vice President for egg
products.
R. Faser Triplett, M.D. (2) 63 R. Faser Triplett, M.D., has served as a
Director director of the Company since September
1996. Dr. Triplett is a practicing
physician and a Clinical Assistant
Professor at the University of Mississippi
School of Medicine. He is the majority
owner of Avanti Travel, Inc. and a
director of Mobile Telecommunications
Technologies Corp.
________________
(1) Member of the Executive Committee
(2) Member of the Audit Committee
(3) Member of the Compensation Committee
The Company's executive officers, each of whom is also a
director of Cal-Maine, serve as executive officers at the pleasure
of the Board.
Board and Committee Meetings
The Board of Directors of the Company held 4 meetings in
fiscal year 1997, and all directors attended the meetings held. The
Executive Committee of the Board consists of Messrs. Adams, Looper,
Baker and Raines. The Board also has a Compensation Committee
consisting of Messrs. Adams, Cox and Triplett, and an Audit
Committee consisting of Messrs. Raines, Cox and Triplett. The
Compensation and Audit Committees were established in October 1997,
after Messrs. Cox and Triplett became members of the Board of
Directors, in anticipation of Cal-Maine becoming a public company.
The Board does not have a nominating committee or committee
performing similar functions.
The Executive Committee may exercise all of the powers of the
full Board of Directors, except for certain major actions, such as
the adoption of any agreement of merger or consolidation, the
recommendation to stockholders of any disposition of substantially
all of the Company's assets or a dissolution of the Company, and
the declaration of a dividend or authorization of an issuance of
stock. The Executive Committee acts on matters, within the scope of
its authority, between meetings of the full Board. During the last
fiscal year, no formal meetings of the Executive Committee were
held, but the Committee, pursuant to Delaware law, took action by
unanimous written consent on 15 occasions.
The Compensation Committee reviews and recommends to the Board
of Directors the compensation and benefits of all officers of the
Company, reviews general policy matters relating to compensation
and benefits of employees of the Company, including the issuance of
stock options to the Company's officers, employees and directors.
Inasmuch as the Company did not become a public company until
December 1996, the Compensation Committee did not meet during the
remainder of fiscal year 1997, or otherwise consider compensation
matters for that year.
The Audit Committee meets with management and the Company's
independent auditors to determine the adequacy of internal controls
and other financial reporting matters. Inasmuch as the Company did
not become a public company until December 1996, the Audit
Committee did not meet during the remainder of fiscal year 1997,
but it did meet with the Company's independent auditors
immediately following the close of that year.
Certain Relationships and Related Transactions
Fred R. Adams, Jr., Chairman of the Board and Chief Executive
Officer of the Company, was a selling stockholder in the Company's
December 1996 underwritten public offering of a total of 2,530,000
shares of Common Stock, including 330,000 over-allotment shares. Of
the total number of shares included in the underwriting, the
Company sold 1,730,000 shares and Mr. Adams sold 800,000 shares,
all at $7.00 per share, before deduction of underwriting discounts
and expenses of the offering. Mr. Adams has reimbursed the Company
in the amount of $115,498 for his share of the expenses of the
offering.
Mr. Adams was indebted to the Company in the amount of
$1,694,444 under a noninterest bearing demand note receivable. In
December 1996, Mr. Adams used an equal amount of the proceeds from
his sale of Common Stock in the December 1996 public offering to
pay his note in full.
During the fiscal year 1997, through September 1996, the
Company and the ESOP repurchased, for cash, shares of Cal-Maine
capital stock owned by Mr. Adams and members of his family and his
spouse's family in the following aggregate amounts: Fred R. Adams,
Jr. - 18,000 shares for $63,150; Jean Adams (Mr. Adams' spouse) -
2,400 shares for $10,400; Mr. Adams' children and their spouses -
2,400 shares for $ $10,400; and Mrs. Adams' children and their
spouses - 6,000 shares for $21,050. All of such repurchases were
made a prices approximating book value, as determined by an
unaffiliated, independent business appraiser.
Under a Redemption Agreement with Mr. Adams executed March 7,
1994 (the "Agreement"), the Company agreed to purchase certain
shares of the Company's capital stock owned by Mr. Adams (the
"Collateralized Shares"), which secured Mr. Adams' obligation under
a promissory note (the "Note") payable to a bank. The Company
agreed to repurchase the Collateralized Shares from the bank, at a
purchase price related to the market value thereof, in the event of
a default under the Note, based on the determination of the Board
of Directors that it would be in the best interest of the Company
for the Collateralized Shares to be acquired, if necessary, by the
Company rather than by an unrelated party. There has been no
default under the Note. At May 31, 1997, Mr. Adams had reduced the
principal amount of the Note to $302,000 and the number of
Collateralized Shares securing his obligation amounted to 127,200
shares of Common Stock.
Compliance with Section 16(a) of the Securities Exchange Act of
1934
Section 16(a) of the Securities Exchange Act of 1934 requires
the Company's directors and executive officers, and persons who own
more than 10% of a registered class of the Company's equity
securities, such as the Common Stock, to file with the Securities
and Exchange Commission initial reports of ownership and reports of
changes in ownership of Common Stock and other equity securities of
the Company. Such persons are also required to furnish the Company
with copies of all forms they file under this regulation. To the
Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company and representations that no other
reports were required, for the fiscal year ended May 31, 1997, all
Section 16(a) reports applicable to its directors and executive
officers were timely filed.
COMPENSATION OF EXECUTIVE OFFICERS AND DIRECTORS
The following Summary Compensation Table sets forth all
compensation awarded to, earned by or paid for services rendered to
the Company in all capacities during the fiscal year ended May 31,
1997 by (i) the Company's chief executive officer and (ii) the
Company's four other most highly compensated executive officers who
were serving as executive officers at the end of that year.
</TABLE>
<TABLE>
SUMMARY COMPENSATION TABLE
Annual Compensation Long-Term
------------------- Compensation
------------
<S> <C> <C> <C> <C>
Name and Principal Positions Salary Bonus (1) LTIP All Other
- ---------------------------- ------ --------- Payouts Compensation(2)
------- ------------
Fred R. Adams, Jr.-
Chairman of the Board and
Chief Executive Officer $253,890 $250,000 None $83,797
Richard K. Looper -
Vice Chairman of
the Board of Directors $138,392 $125,000 $50,000(3) $ 1,246
Adolphus B. Baker -
President, Chief
Operating Officer
and Director $103,890 $100,000 $ 710
Bobby J. Raines -
Vice President,
Chief Financial
Officer, Treasurer
and Secretary $127,065 $110,000 (4) $ 977
Jack B. Self - Vice
President/Operations
and Production $91,330 $64,188 $1,102
</TABLE>
_____________________
(1) With consideration of the recommendations of the Compensation
Committee, bonuses are determined annually by the Board of
Directors on a discretionary basis based on the results of the
Company's operations and the Board's evaluation of the executive
officer's contribution to such performance. However, because of
its recent formation, in October 1996, the Compensation
Committee did not participate in the determination of the
compensation amounts for the fiscal year 1997, as shown in the
Summary Compensation Table.
(2) The amounts shown represent premiums paid under separate life
insurance policies purchased by the Company for each person
named in the table. The policy on Mr. Adams' life is owned by
an Adams family intervivos trust, and the beneficiaries are Mr.
Adams' four daughters and their descendants. Messrs. Looper,
Raines and Self are the owners of their respective policies, and
members of their families are the beneficiaries. The Company is
not a beneficiary under any of such policies and will not
receive any portion of the proceeds paid thereunder upon the
death of any of the insureds. In addition, the Company made
contributions to the account of each named executive maintained
under the Company's Employee Stock Ownership Plan. See "Employee
Stock Ownership Plan" below.
(3) Paid pursuant to Mr. Looper's incentive compensation agreement
with the Company. See "Long Term Incentive Plans," below.
(4) Messrs. Raines and Self earn compensation payable in the future
pursuant to long term incentive plans. See "Long Term Incentive
Plans" below.
No options were granted to the above-named executive officers in fiscal 1997.
Fiscal Year End Option Value Table
The following table sets forth information as of May 31, 1997,
concerning the unexercised options held by executive officers named
in the Summary Compensation Table, none of whom exercised options in
fiscal year 1997. Options are "in-the-money" when the fair market of
underlying Common Stock exceeds the exercise price of the option.
The closing price of Common Stock on May 31, 1997 was $6.75 per
share.
<TABLE>
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options at
Options at May 31, 1997 May 31, 1997 (1)
<S> <C> <C> <C> <C>
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ----------- -------------
Richard K.
Looper 96,000 24,000 319,680 79,920
Adolphus B.
Baker 38,400 9,600 127,872 31,968
Bobby J.
Raines 76,800 19,200 255,744 63,936
Jack B. Self 38,400 9,600 127,872 31,968
- -----------------
</TABLE>
(1) Market value of underlying securities on May 31, 1997,
minus the exercise price.
Employee Stock Ownership Plan
The Company maintains a payroll-based Employee Stock Ownership
Plan (the "ESOP"). Pursuant to the ESOP, originally established in
1976, substantially all persons employed at January 1, 1994, as well
as substantially all new full-time employees over age 21 with one or
more years of service, participate. Its assets, which are managed by
a trustee designated by the Board, consist primarily of Common Stock
of the Company. Contributions by the Company may be made in cash or
shares of Common Stock, as determined by the Board of Directors.
Employee contributions are not permitted. Company contributions
generally may not exceed 15% of the aggregate annual compensation of
participating employees. Contributions are allocated to the
accounts of participating employees in the proportion which each
employee's compensation for the year bears to the total compensation
(up to $150,000 per employee) of all participating employees.
Company contributions vest 20% annually beginning with the
participating employee's third year of service.
Shares of Common Stock held in an employee's account are voted
by the ESOP trustee in accordance with the employee's instructions.
An employee or his or her beneficiary is entitled to distribution of
the balance of his or her account upon termination of employment.
The Company's contributions to the ESOP amounted to approximately
$1,284,000 in fiscal year 1997. For fiscal year 1997, the Company's
contributions to the ESOP on behalf of each of the executive
officers named in the Summary Compensation Table were: Fred R.
Adams, Jr. - $4,240, Richard K. Looper - $8,452, Adolphus B. Baker -
$7,453, Bobby J. Raines - $2,022, and Jack B. Self - $8,019.
1993 Stock Option Plan
Pursuant to the Company's 1993 Stock Option Plan, which was
adopted on May 25, 1993 and amended on September 23, 1996, with
stockholder approval, (the "1993 Plan") a total of 800,000 shares of
Common Stock are reserved for issuance upon the exercise of options
that may be granted to directors, officers and key employees of the
Company. Options are awarded by the Board of Directors of the
Company and may be either incentive stock options ("ISOs") that
satisfy the requirements of Section 422 of the Code or nonstatutory
options ("NSOs") which are not intended to satisfy such
requirements.
The exercise price per share under any option granted under
the 1993 Plan may not be less than 100% of the fair market value of
the Common Stock on the date of grant, or in the case of ISOs, less
than 110% of such fair market value if the option is granted to a
person who holds 10% or more of the voting power of the capital
stock of the Company. The number and kind of shares subject to an
option, and the option exercise price, may be adjusted in certain
circumstances to prevent dilution. The method of payment of an
option exercise price will be as determined by the Board of
Directors and set forth in the individual stock option agreement.
No options may be granted under the 1993 Plan more than ten
years after the date of its adoption, and no option may exercised
more than 10 years after the date of its grant, or in the case of an
ISO, more than five years after the date of grant if granted to a
person holding more than 10% of the voting power of the Common
Stock. The term or times at which an option may be exercised and
any conditions or restrictions relating thereto will be as
determined by the Board of Directors and set forth in the individual
stock option agreement. Options are not transferable or assignable
otherwise than by will or the laws of descent and distribution, and
during his or her lifetime may only be exercised by the optionee.
The presently outstanding options granted under the 1993 Plan
are exercisable on a cumulative basis over a period of six years
from the date of grant at the rate of 20% per year beginning twelve
months after the date of grant. The shares subject to the 1993 Plan
have been registered under the Securities Act of 1933.
Savings and Retirement Plan
Since 1985, the Company has maintained a defined contribution
savings and retirement plan (the "Retirement Plan"), which is
designed to qualify under Sections 401 (a) and 401 (k) of the Code.
An employee is eligible to participate in the Retirement Plan on or
after having attained age 21 and after one year of service. The
Retirement Plan is administered by the Company and permits covered
employees to contribute up to the maximum allowed by the IRS
regulations. Highly compensated employees may be subject to further
limitations on the amount of their maximum contribution. The Company
may make discretionary contributions matching each employee's pre-
tax contributions. At the present time, the Company does not make
discretionary contributions. The Retirement Plan is intended to
comply with the Employee Retirement Income Security Act of 1974, as
amended.
Participating employees are at all times 100% vested in their
account balances under the Retirement Plan. Benefits are paid at the
time of a participant's death, retirement, disability, termination
of employment, and, under limited circumstances, may be withdrawn
prior to the employee's termination of service. Contributions are
not taxable to employees until such funds are distributed to them.
Long Term Incentive Plans
The Company has entered into certain incentive compensation
continuation agreements (the "Agreements") with Richard K. Looper,
Bobby J. Raines, and Jack B. Self. Pursuant to the Agreements, each
such executive officer may earn up to ten years of compensation
payments if he remains with the Company until age 65. If the
officer's employment ends before his 65th birthday, he would be
entitled to fewer years of incentive compensation payments,
depending on the length of time served as an officer. The incentive
compensation payments are made monthly, beginning immediately after
the officer's 65th birthday, at the annual rate of $50,000 per year
for Messrs. Looper and Raines, and $20,000 per year for Mr. Self.
Further, the Agreement with Mr. Self was amended, effective
September 2, 1994, so that for each subsequent year, after age 65,
Mr. Self serves as an officer of the Company, he is entitled to
receive one additional year of incentive compensation payable at the
annual rate of $20,000 per year. The Agreements provide that once
payments begin or have been earned, any remaining payments will
continue to be made to the officer's estate after his death.
Messrs. Looper and Raines have each earned 10 years of
incentive compensation payments under the Agreements, and Mr. Self
has earned 12 years of such payments. Mr. Looper began receiving
his payments on December 1, 1991, while Mr. Raines' payments will
not begin until after his 65th birthday. Mr. Self's payments will
not begin until he retires.
Director Compensation
The Company's non-employee directors are each entitled to
receive $10,000 annually as compensation for their services as a
director and may be granted options to purchase Common Stock under
the 1993 Plan. Options to purchase 12,000 shares of Common Stock at
a price of $4.33 per share were granted on October 15, 1996 to each
of W. D. (Jack) Cox and R. Faser Triplett, the non-employee
directors of the Company. All options expire ten years after grant.
Directors also may be compensated for any services performed in
addition to their normal duties as a director of the Company.
Employee-directors receive no additional compensation for their
services as directors of the Company.
Compensation Committee Interlocks and Insider Participation
In October 1996, in anticipation of the Company's public
offering, the Board of Directors established a Compensation
Committee. As indicated above, the members of the Committee are Fred
R. Adams, Jr., Chairman of the Board of Directors and Chief
Executive Officer, and W.D. (Jack) Cox and R. Faser Triplett,
independent directors of the Company.
Mr. Adams, as previously discussed, has been, and is, a party
to certain transactions to which Cal-Maine also has been, or is, a
party. See "Certain Relationships and Related Transactions" under
"Election of Directors." From 1970 to 1972, Mr. Cox was employed by
the Company as Vice President for egg products.
Compensation Committee Report and Stock Performance Graph
In view of the fact that the Compensation Committee was
established in October 1996, and Cal-Maine became a public company
in December 1996, the Compensation Committee did not participate in
any consideration of any executive officer's compensation for the
fiscal year ended May 31, 1997. Accordingly, no Compensation
Committee report on executive compensation is included in this proxy
statement. Commencing with the Company's proxy statement for the
1998 annual meeting of shareholders, the Compensation Committee will
provide a report of its policies applicable to executive officer
compensation, and the basis for the Chief Executive Officer's
compensation.
As Cal-Maine has been a public company for less than six months
at May 31, 1997, the end of its last fiscal year, a graph comparing
cumulative annual total shareholder return with that of particular
market indices had not been included in this proxy statement, but
will be provided commencing with the Company's proxy statement for
the 1998 annual meeting of the shareholders.
RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors, upon recommendation of the Audit
Committee, has appointed Ernst & Young LLP, independent public
accountants, to act as auditors for the fiscal year ending May 30,
1998. Ernst & Young LLP has audited the accounts of the Company
since 1989. Representatives of Ernst & Young LLP are expected to be
present at the annual meeting and will have an opportunity to make
a statement if they desire to do so and will be available to respond
to appropriate questions.
SHAREHOLDER PROPOSALS
Shareholder proposals must be received in writing by the
Company no later than May 5, 1998, to be considered for inclusion in
the Company's proxy materials for the 1998 Annual Meeting.
Shareholder proposals should be addressed to Cal-Maine Foods, Inc.,
Post Office Box 2960, Jackson, Mississippi 39207, Attention:
Secretary. No shareholder proposals were received for inclusion in
the proxy materials for the 1997 meeting.
OTHER MATTERS
The Board of Directors is not aware of any other matters which
may come before the meeting. However, if any other matters are
properly brought before the meeting, the proxies in the enclosed
proxy will vote in accordance with their best judgment on such
matters.
Holders of Common Stock are urged to complete, sign and date
the accompanying proxy card and return it in the enclosed envelope.
No postage is necessary if the proxy card is mailed in the United
States.
<TABLE>
<S> <C>
By order of the Board of Directors,
s/Bobby J. Raines
___________________________________
Bobby J. Raines, Secretary
</TABLE>
Jackson, Mississippi
September 8, 1997
CAL-MAINE FOODS, INC.
THIS PROXY IS BEING SOLICITED BY THE COMPANY'S
BOARD OF DIRECTORS.
The undersigned hereby appoints Fred R. Adams, Jr. and Bobby
J. Raines, or either of them, as proxies with the power to appoint
their substitutes and hereby authorizes them to represent and vote,
as designated below, all the shares of Common Stock of Cal-Maine
Foods, Inc. (the "Company"), held of record by the undersigned on
August 27, 1997, at the Annual Meeting of Stockholders of the
Company, to be held on October 8, 1997, and at any adjournments
thereof, with all powers the undersigned would possess if
personally present.
1. Election of Directors (Check only one box below. To
withhold authority for any individual nominee, strike
through the name of nominee.)
To vote for all the nominees listed below:
Fred R. Adams, Jr., Richard K. Looper, Adolphus B.
Baker, Bobby J. Raines, Jack B. Self, Joe M. Wyatt,
Charles F. Collins, W. D. (Jack) Cox, and R. Faser
Triplett
OR
To withhold authority to vote for all nominees
listed above.
2. Ratification of the appointment of Ernst & Young LLP as
the Company's independent auditors (check only one box
below).
_____ FOR _____AGAINST _____ABSTAIN
3. In their discretion, the proxies are authorized to vote
upon such other business as may properly come before the
meeting and any adjournments thereof. If a nominee for
director is unable to serve or, for good cause, will not
serve as director, the proxies may vote for any person
for director in their discretion.
When properly executed, this proxy will be voted in the manner
directed. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE
ELECTION OF ALL NOMINEES LISTED AND FOR PROPOSAL 2. The undersigned
hereby revokes any proxy heretofore given by the undersigned to
vote at the Annual Meeting. This proxy may be revoked prior to its
exercise, either in person or in writing.
<TABLE>
<S> <C>
__________________________________________
Signature
__________________________________________
Signature if held jointly
_____________________________________, 1997.
(Date)
1. Sign your name exactly as
it appears on the label.
2. When signing as attorney,
executor, administrator,
trustee, or guardian,
please state full title
as such.
3. If a corporation, please
sign in full corporate
name by president or
other authorized officer.
4. If a partnership, please
sign in partnership name
by authorized person.
5. When shares are held
jointly, both
stockholders must sign
this proxy.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY USING THE ENCLOSED
POSTAGE-PAID ENVELOPE.
</TABLE>
