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 ss. 240.14a-11(c) or ss. 240.14a-12
RICA FOODS, INC.
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(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)(1) and 0-11.
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 determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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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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3) Filing Party:
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4) Date Filed:
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<PAGE>
RICA FOODS, INC.
95 MERRICK WAY
SUITE 507
CORAL GABLES, FLORIDA, 33134
-------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON JUNE 18, 1999
-------------------------
To the Shareholders of
Rica Foods, Inc.:
NOTICE IS HEREBY GIVEN that the 1999 Annual Meeting of Shareholders
(the "Annual Meeting") of Rica Foods, Inc., a Nevada corporation (the "Company")
will be held on June 18, 1999, at 10:00 a.m., local time, at the Sheraton
Biscayne Bay Hotel, 495 Brickell Avenue, Miami, Florida, 33131, for the
following purposes:
1. To elect seven members of the Company's Board of Directors to hold
office until the Company's 2000 Annual Meeting of Shareholders or until
their successors are duly elected and qualified;
2. To consider and vote upon a proposal to ratify the selection of Arthur
Andersen LLP as the Company's independent auditors for the fiscal year
ended September 30, 1998; and
3. To transact such other business as may properly come before the Annual
Meeting or any adjournments or postponements thereof.
All shareholders are cordially invited to attend; however, only
shareholders of record at the close of business on April 30, 1999 are entitled
to vote at the Annual Meeting or any adjournments thereof.
By Order of the Board of Directors,
MONICA CHAVES
SECRETARY
Coral Gables, Florida
May 28, 1999
THIS IS AN IMPORTANT MEETING AND ALL SHAREHOLDERS ARE INVITED TO ATTEND THE
MEETING IN PERSON. WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON,
PLEASE COMPLETE, SIGN AND DATE THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY IN
THE ENCLOSED RETURN ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED
STATES. SHAREHOLDERS WHO EXECUTE A PROXY CARD MAY NEVERTHELESS ATTEND THE
MEETING, REVOKE THEIR PROXY AND VOTE THEIR SHARES IN PERSON.
<PAGE>
1999 ANNUAL MEETING OF SHAREHOLDERS
OF
RICA FOODS, INC.
-----------------------------------------
PROXY STATEMENT
-----------------------------------------
June 18, 1999, 10:00 a.m. local time,
Sheraton Biscayne Bay Hotel, Miami, Florida 33131
This Proxy Statement is furnished in connection with the solicitation
by the Board of Directors of Rica Foods, Inc., a Nevada corporation (the
"Company"), of proxies from the holders of the Company's common stock, par value
$.001 per share (the "Common Stock"), for use at the 1999 Annual Meeting of
Shareholders of the Company to be held at the Sheraton Biscayne Bay Hotel, 495
Brickell Avenue, Miami, Florida, 33131, on June 18, 1999, at 10:00 a.m. local
time, or at any adjournment(s) or postponement(s) thereof (the "Annual
Meeting"), pursuant to the foregoing Notice of Annual Meeting of Shareholders.
The approximate date that this Proxy Statement and the enclosed form of
proxy are first being sent to shareholders is May 28, 1999. Shareholders should
review the information provided herein in conjunction with the Company's 1998
Annual Report on Form 10K. The complete mailing address, including zip code, of
the Company's principal executive offices is 95 Merrick Way, Suite 507, Coral
Gables, Florida, 33134, and its telephone number is (305) 476-1757.
INFORMATION CONCERNING PROXY
The enclosed proxy is solicited on behalf of the Company's Board of
Directors. The giving of a proxy does not preclude the right to vote in person
should any shareholder giving the proxy so desire. Shareholders have an
unconditional right to revoke their proxy at any time prior to the exercise
thereof, either in person at the Annual Meeting or by filing with the Company's
Secretary at the Company's headquarters a written revocation or duly executed
proxy bearing a later date; however, no such revocation shall be effective until
written notice of the revocation is received by the Company at or prior to the
Annual Meeting.
The cost of preparing, assembling and mailing this Proxy Statement, the
Notice of Annual Meeting of Shareholders and the enclosed proxy is to be borne
by the Company. In addition to the use of mail, employees of the Company may
solicit proxies personally and by
<PAGE>
telephone. The Company's employees will receive no compensation for soliciting
proxies other than their regular salaries. The Company may request banks,
brokers and other custodians, nominees and fiduciaries to forward copies of the
proxy material to their principals and to request authority for the execution of
proxies. The Company may reimburse such persons for their expenses in so doing.
PURPOSES OF THE MEETING
At the Annual Meeting, the Company's shareholders will consider and
vote upon the following matters:
1. The election of seven members to the Company's Board of
Directors to serve until the Annual Meeting of Shareholders of
the Company's fiscal year 1999, or until their successors are
duly elected and qualified;
2. To consider and vote upon a proposal to ratify the selection of
Arthur Andersen LLP as the Company's independent auditors for
the fiscal year ended September 30, 1998; and
3. Such other business as may properly come before the Annual
Meeting, including any adjournments or postponements thereof.
Unless contrary instructions are indicated on the enclosed proxy, all
shares represented by valid proxies received pursuant to this solicitation (and
which have not been revoked in accordance with the procedures set forth above)
will be voted: (1) FOR the election of the seven nominees for director named
below; and FOR the ratification of Arthur Andersen LLP as the Company's
independent auditors for the fiscal year ended September 30, 1998.
In the event a shareholder specifies a different choice by means of the
enclosed proxy, his shares will be voted in accordance with the specification so
made. The Board does not know of any other matters that may be brought before
the Annual Meeting nor does it foresee or have reason to believe that proxy
holders will have to vote for substitute or alternate director nominees. In the
event that any other matter should come before the Annual Meeting or any
director nominee is not available for election, the persons named in the
enclosed proxy will have discretionary authority to vote all proxies not marked
to the contrary with respect to such matters, in accordance with their best
judgment.
OUTSTANDING VOTING SECURITIES AND VOTING RIGHTS
The Board of Directors has set the close of business on April 30, 1999
as the record date (the "Record Date") for determining shareholders of the
Company entitled to notice of and to vote at the Annual Meeting. As of the
Record Date, there were 7,419,138 shares of Common Stock issued and outstanding,
all of which are entitled to be voted at the Annual Meeting. Each share of
Common Stock is entitled to one vote on each matter submitted to shareholders
for approval at the Annual Meeting. Shareholders do not have the right to
cumulate their votes for directors.
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<PAGE>
The Company's Bylaws provide that the presence, in person or by proxy,
of the holders of record of one-third of the outstanding shares of Common Stock
entitled to vote at the Annual Meeting are necessary to constitute a quorum.
Pursuant to the Nevada General Corporation Law, directors (Proposal No. 1) will
be elected by a plurality of the votes cast by the shares of Common Stock
represented in person or by proxy at the Annual Meeting. Pursuant to the
Company's Bylaws, the affirmative vote of a majority of the outstanding shares
of Common Stock represented in person or by proxy at the Annual Meeting is
required to approve the ratification of auditors (Proposal No. 2). Abstentions
and broker non-votes are counted as present for purposes of determining the
presence of a quorum. Abstentions are not counted as votes cast "for" or
"against" any proposal or any person nominated for director. A broker non-vote
on a matter is considered not entitled to vote on that matter and this is not
counted in determining whether a matter requiring approval of a majority of the
shares present and entitled to vote has been approved or whether a plurality of
the shares present and entitled to vote has been voted in favor of a proposal.
If less than one-third of the outstanding shares of Common Stock
entitled to vote are represented at the meeting, a majority of the shares so
represented may adjourn the meeting to another date, time or place, and notice
need not be given for the new date, time or place, if the new date, time or
place is announced at the meeting before an adjournment is taken. Prior to the
Annual Meeting, the Company will select one or more inspectors of election for
the meeting. Such inspectors shall determine the number of shares of Common
Stock represented at the meeting, the existence of a quorum and the validity and
effect of proxies and shall receive, count and tabulate ballots and votes and
determine the results thereof.
A list of shareholders entitled to vote at the Annual Meeting will be
available at the Company's offices, 95 Merrick Way, Suite 507, Coral Gables,
Florida 33134, for a period of ten days prior to the Annual Meeting and at the
Annual Meeting itself, for examination by any shareholder.
DATE OF RECEIPT OF SHAREHOLDER PROPOSALS
Shareholder proposals for inclusion in the Proxy Statement for the
Annual Meeting of Shareholders to be held in the year 2000 must be received at
the principal executive offices of the Company on or before February 1, 2000. If
the Company does not receive notice at its principal executive offices on or
before February 1, 2000 of a shareholder proposal for consideration at the
Annual Meeting of Shareholders to be held in the year 2000, the proxies named by
the Company's Board of Directors with respect to that meeting shall have
discretionary voting authority with respect to that proposal.
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<PAGE>
ELECTION OF DIRECTORS
(PROPOSAL NO. 1)
The Company's Articles of Incorporation and Bylaws provide that the
number of directors shall consist of at least three members and not more than
nine members, as shall be designated by the Board of Directors from time to
time. The director nominees are: (1) Calixto Chaves; (2) Jorge M. Quesada; (3)
Luis Guinot, Jr.; (4) Luis J. Lauredo; (5) Federico Vargas; (6) Alfred E. Smith
IV; and (7) Jose Pablo Chaves. Each such nominee currently serves as a Director
of the Company. The Board of Directors has no reason to believe that any nominee
will refuse or be unable to accept election; however, in the event that one or
more nominees are unable to accept election or if any other unforeseen
contingencies should arise, each proxy that does not direct otherwise will be
voted for the remaining nominees, if any, and for such other persons as may be
designated by the Board of Directors. Certain information regarding each nominee
follows. Each nominee has consented to being named in the Proxy Statement and to
serve if elected.
CALIXTO CHAVES. Mr. Chaves was the founder and President of Corporacion
Pipasa, S.A. from its inception in 1969 to the present. He was the founder and
President of Aero Costa Rica, S.A., a private Costa Rican airline. He is
currently on the Boards of Directors of Central American Oils and Derivatives,
S.A., and American Oleaginous Industry ("Inolasa"). From 1994 to 1996, he was a
Board member of Cerveceria Americana, a private brewery. In 1994, he served as
an advisor to the Ministry of Economic Business Affairs. From 1983 to 1985, he
was a member of the Board of Directors of the Sugar Cane Agricultural League.
From 1982 to 1986, he served in the Costa Rican Ministry of Industry, Energy and
Mines and became Minister of Natural Resources in 1986. From 1982 to 1986, he
was a member of the Board of Directors of MINASA, a Costa Rican mining company.
Mr. Chaves was founder of the Chamber of Industries in the Costa Rican province
of Heredia. From 1973 to 1974, he was President of the Board of Directors of
Banco Nacional de Belen.
LIC. JORGE M. QUESADA. Mr. Quesada has held numerous positions with
Corporacion Pipasa, S.A. since 1985 and has been Executive Vice President since
1990. In May, 1999, he was appointed as the Executive President of Corporacion
Pipasa, S.A. He was a member of the Boards of Directors of Banco Fomento
Agricola from 1991 until 1997. From 1987 to 1991, he was on the Board of
Directors of Financiera Belen, S.A. Mr. Quesada has conducted numerous seminars
regarding marketing issues. He obtained his Degree in Business Administration,
with emphasis on Public Accounting, from the University of Costa Rica in 1984.
HONORABLE AMBASSADOR MR. LUIS GUINOT, JR. Luis Guinot Jr. was born in
San Juan, Puerto Rico on April 8, 1935. He attended college in the United
States, where he graduated from the Catholic University of America School of Law
in Washington, D.C. After completing his undergraduate studies at New York
University, he was commissioned an Ensign in the U.S. Navy where he served in
several billets-both shore and afloat - including a tour of duty as gunnery
officer of the destroyer USS Gearing (DD710) and Senior Shore Patrol Officer of
the U.S. Sixth Fleet based in Naples, Italy. After completion of his military
obligation, Mr. Guinot entered the private practice of law in Washington, D.C.
Mr. Guinot has served as United States Ambassador to the Republic of Costa Rica,
as the Assistant General Counsel of the United States
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<PAGE>
Department of Agriculture and as Administrator of the Office of the Commonwealth
of Puerto Rico in Washington, D.C. Additionally, Mr. Guinot has also appeared as
speaker and lecturer on United States-Latin American Trade, North American Free
Trade Agreement ("NAFTA"), and General Agreement on Trade and Tariffs ("GATT")
related matters, and he is the author of several newspaper articles on the same
subject. Mr. Guinot is a member of the Commonwealth of Virginia and the District
of Columbia Bar Association and has been admitted to practice before the bars of
the U.S. Supreme Court, the 1st and the 11th Circuit Court of Appeals, the Bars
of the Southern District of New York, and the Southern District of Florida,
Eastern Districts of Virginia, and the Court of military appeals. Mr. Guinot is
also a fellow of the American Bar Foundation, a former member of the U.S.
Presidential Commission on Civil Disorders (Kerner Commission) and former member
of the Board of Directors of the Legal Services Corporation. Mr. Guinot was
awarded the Grand Order of Juan Mora (Silver Plaque) by the Government of Costa
Rica. He has been featured speaker on Conferences on the general subject of
hemispheric free trade and served as legal advisor to U.S. corporations doing
business in Latin America as well as legal advisor to ministries of Central and
South American Countries. He is currently a member of the U.S. law firm of
Shapiro and Olander. He devotes such time as is necessary to fulfill his
obligations as an outside director of the Company.
LUIS J. LAUREDO. From 1995 to the present, he has been the Director of
the International Consulting Group for the law firm of Greenberg Traurig, of
Miami, Washington, and New York. From 1994 to 1995, he was Executive Director of
the Summit of the Americas, a non-profit organization. From 1992 to 1994, he was
a Commissioner on the Florida Public Service Commission, as well as Chairman of
the International Relations Committee of the National Association of Regulatory
Utility Commissioners. In his career, Mr. Lauredo has had a number of positions
in the banking industry. He has served on numerous advisory committees,
including the Export-Import Bank of the U.S. He has represented the President of
the United States as special U.S. Ambassador to the inaugurations of the
Presidents of Colombia, Venezuela, Brazil, and Costa Rica. He also served as a
founding Director of the Hispanic Council on Foreign Affairs, Washington, D.C.
Mr. Lauredo received his Bachelors degree from Columbia University in New York
City and has attended the University of Madrid in Spain and Georgetown
University Law Center in Washington, D.C. He devotes such time as is necessary
to fulfill his obligations as an outside director of the Company.
DR. FEDERICO VARGAS. He has served as a Professor of Economics and
Social Sciences at the University of Costa Rica from 1963 to the present. Dr.
Vargas has been involved in extensive political activities since 1974. From 1990
to 1994, he served as a Deputy in the Costa Rican Assembly. From 1993 to 1994,
he was Chairman of the Legislative Section of the National Liberation Party of
Costa Rica. Prior to 1990, Dr. Vargas held a number of political offices,
including Ambassador of Costa Rica to the United States, Ambassador of Costa
Rica to the Organization of American States, Counselor to the President of Costa
Rica in Finance and External Debt, with the rank of Minister, and Economics
Advisor to the President of Costa Rica. His teaching activities included serving
as the Chairman of Economists at the Instituto de Investigaciones Economicas,
University of Costa Rica and Director of the Economics Department, School of
Economics and Social Sciences, University of Costa Rica. Dr. Vargas serves on
the boards and advisory bodies of numerous charitable and educational
organizations and is the author of a number of publications on economic and
educational matters. He obtained
-5-
<PAGE>
his Bachelors in Business Administration from Nichols College in Massachusetts
in 1954 and his Ph.D. from the University of Colorado in 1967. He has also
attended the Wharton School of Finance and Commerce at the University of
Pennsylvania. He devotes such time as may be necessary to fulfill his
obligations as an outside director of the Company.
ALFRED E. SMITH, IV. Mr. Smith has been a director of the Company since
June 1, 1994. He was a partner of the New York Stock Exchange member firm of
Adler, Coleman & Co., Inc. from 1979 to 1994. Since 1998, he has been with Bear,
Hunter Specialist, a New York Stock Exchange member firm. In September, 1994,
Adler, Coleman & Co. sold the Adler, Coleman Cleaning division to an
unaffiliated third party. In February, 1995, the entity that acquired the Adler,
Coleman Cleaning division filed for bankruptcy protection under Chapter 11. Mr.
Smith is a member of the Government Relations Committee of the New York
Exchange, Director and Secretary of the Alfred Emanuel Smith Memorial
Foundation, Chairman of the Cardinal's Committee for the Laity-Wall Street
Division, Director of the Center for Hope, a Trustee of St. Vincent's Hospital
and a Trustee of Iona Prep School. He is a member of the New York City Advisory
Board of the Enterprise Foundation and the American Association of the Sovereign
Military Order of Malta. He has received numerous awards for his charity and
humanitarian work. Mr. Smith was educated at Villanova University. He devotes
such time as may be necessary to fulfill his obligations as an outside director
of the Company.
JOSE PABLO CHAVES. Mr. Chaves assists the Board of Directors of Pipasa
and As de Oros, as well as Restaurantes As de Oros, S.A., and is a board member
of the Company and the Company's Chief Operating Officer. Mr. Chaves studied
Business Administration with emphasis in Marketing in the U.S. at Babson
College in Massachusetts and in Costa Rica. Mr. Chaves is the founder of three
Costa Rican Companies, and is the son of Calixto Chaves.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE COMPANY'S
SHAREHOLDERS VOTE "FOR" THE ELECTION
OF THE SEVEN DIRECTOR NOMINEES
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<PAGE>
MANAGEMENT
COMMITTEES AND MEETINGS OF THE BOARD OF DIRECTORS
During the fiscal year ended September 30, 1998, the Company's Board of
Directors held four regularly scheduled meetings, and took action one time by
unanimous written consent. Each Director of the Company attended at least 75% of
the aggregate of (i) the number of the meetings of the Board which were held
during the period that such person served on the Board and (ii) the number of
meetings of committees of the Board of Directors held during the period that
such person served on such committee.
The Company has two committees: the Audit Committee and the
Compensation Committee. The Company does not have a nominating committee.
The Audit Committee is currently comprised of Luis Lauredo, Federico
Vargas and Jorge Quesada. The Audit Committee's functions include reviewing
reports and audits with the Company's independent public accountants, and
reporting their findings to the full Board of Directors. The Audit Committee met
one time during the fiscal year ended September 30, 1998.
The Compensation Committee is currently comprised of Calixto Chaves and
Jorge Quesada. The Compensation Committee's functions consist of recommending,
reviewing and approving the salary and fringe benefit policies of the Company,
including compensation of the executive officers of the Company. The
Compensation Committee met one time during the fiscal year ended September 30,
1998.
ADDITIONAL INFORMATION CONCERNING DIRECTORS
The Company reimburses all members of the Board of Directors for their
expenses in connection with their activities as Directors of the Company. In
addition, Directors of the Company receive additional compensation for their
services as Directors at the rate of $200 for each Board Meeting that they
attend.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT 1934
Section 16(a) of the Securities Exchange Act 1934, as amended (the
"1934 Act"), requires the Company's directors and executive officers, and
persons who own more than 10% of the Company's outstanding Common Stock, to file
with the Securities and Exchange Commission (the "SEC") initial reports of
ownership and report of changes in ownership of Common Stock. Such persons are
required by SEC regulations to furnish the Company with copies of all such
reports they file.
To the Company's knowledge, during the fiscal year ended September 30,
1998, none of the Company's directors, executive officers, and persons who own
more than 10% of the Company's outstanding Common Stock engaged in any trading
of the Company's Common Stock. The Company believes that the Company's executive
officers and directors complied with the SEC's requirements with respect to
transactions during the fiscal year.
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<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the number of post-split shares of
Common Stock of the Company which were owned beneficially by (i) each person who
is known by the Company to own beneficially more than 5% of its Common Stock,
(ii) each director and nominee for director, (iii) certain executive officers of
the Company, and (iv) all directors and officers as a group, prior to the
acquisitions and after the acquisitions of 100% of Pipasa and As de Oros:
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF PERCENT OF AMOUNT AND NATURE PERCENT OF
BENEFICIAL SHARES OWNED OF BENEFICIAL SHARES OWNED
NAME AND ADDRESS OF OWNERSHIP PRIOR TO PRIOR TO OWNERSHIP AFTER AFTER
BENEFICIAL OWNER(1) ACQUISITIONS (2)(3) ACQUISITIONS (2) ACQUISITIONS(2)(3) ACQUISITIONS(2)
- ----------------------------------------- ---------------------- ----------------- ------------------- ---------------
<S> <C> <C> <C> <C>
Calixto Chaves...................... 1,993,315(4) 26.87% 5,676,910(5) 44.44%
Comercial Angui, S.A................ 815,686 10.99% 2,486,607(6) 19.46%
c/o Bufete Chaverri, Soto & Asociados
Barrio Escalante de Cine Magaly,
400 Metros Este
San Jose, Costa Rica
Jorge M. Quesada.................... 52,295(7) * 52,295(7) *
Monica Chaves....................... 133,333(8) * 133,333(8) *
Luis Guinot, Jr. ................... 0 0 0 0
Luis J. Lauredo .................... 0 0 0 0
Federico Vargas..................... 0 0 0 0
Alfred E. Smith IV.................. 33,333 * 33,333 *
Jose Pablo Chaves................... 279,324(9) * 279,324(9) *
</TABLE>
* Indicates less than 1% of outstanding shares owned.
(1) Unless otherwise indicated, the address of each beneficial owner is
RICA FOODS, INC., 95 Merrick Way, Suite 507, Coral Gables, Florida
33134.
(2) A person is deemed to be the beneficial owner of securities that can be
acquired by such person within 60 days from the date hereof upon
exercise of options, warrants and convertible securities. Each
beneficial owner's percentage ownership is determined by assuming that
options, warrants and convertible securities that are held by such
person (but not those held by any other person) and that are
exercisable within 60 days from the date hereof have been exercised.
(3) Unless otherwise noted, the Company believes that all persons named in
the table have sole voting and investment power with respect to all
shares of common stock beneficially owned by them.
(4) Includes 861,315 shares of common stock owned of record by Atisbos de
Belen, S.A., a Costa Rican corporation wholly-owned by Mr. Chaves and
his wife, 833,333 shares of common stock owned of record by Inversiones
Leytor, S.A., a Costa Rican company wholly-owned by Mr. Chaves, and
298,667 shares of common stock owned of record by OCC, S.A., a Costa
Rican company wholly-owned by Mr. Chaves and his wife. Does not include
133,333 shares and 279,324 shares owned by his adult daughter and adult
son respectively.
(5) Includes 3,683,595 shares of common stock to be acquired pursuant to
the acquisition of the minority interest in Pipasa.
(6) Includes 1,670,921 shares of common stock to be acquired pursuant to
the acquisition of the minority interest in As de Oros.
(7) Includes 52,295 shares owned by Jorque, S.A., a closely-held Costa
Rican company whose principal shareholders are the wife and adult son
of Mr. Jorge Quesada.
(8) Owned of record by Moninternacional, S.A., a Costa Rican corporation
owned by Monica Chaves, the adult daughter of Calixto Chaves. Mr.
Chaves disclaims any beneficial ownership of these shares.
(9) Owned of record by Rtrosptva, S.A., a Costa Rican corporation owned by
J. P. Chaves, the adult son of Calixto Chaves. Calixto Chaves disclaims
any beneficial ownership of these shares.
-8-
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth the Summary Compensation Table for the
Chief Executive Officer and the most highly compensated executive officer other
than the Chief Executive Officer who was serving as executive officer at the end
of the last fiscal year:
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
--------------------------
SALARY OTHER
NAME AND MAIN POSITION YEARS COMPENSATION (1) COMPENSATION(2)
---------------------- ----- ---------------- ---------------
<S> <C> <C> <C>
Calixto Chaves 1998 $126,780 $1,993
Chief Executive Officer 1997 104,477 5,098
1996 94,780 3,864
</TABLE>
(1) All salary compensation was paid in Costa Rican colones, rather than
U.S. dollars. For the purposes of this presentation, all compensation
has been converted to U.S. dollars at the then current exchange rate
for Costa Rican colones.
(2) Represents Director's fees payable for action as a Director of Pipasa.
OPTION GRANTS
There were no stock options, stock appreciation rights or long-term
incentive awards granted to Calixto Chaves as compensation during the fiscal
year ended September 30, 1998.
EMPLOYMENT AGREEMENTS AND CHANGE IN CONTROL AGREEMENTS
The Company has no employment agreements and no change in control
agreements with any executive officer.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company has a Compensation Committee consisting of Calixto Chaves,
Chairman of the Board and Jorge Quesada, Director. This Committee makes the
determinations for stock issuances pursuant to the Company's compensation plans.
The Company has no retirement, pension or profit sharing plans covering its
officers and directors, but does contemplate implementation of such plans in the
future through Pipasa, As de Oros and ASERICA (the Company's Employee
Association).
PERFORMANCE GRAPH
The following graph compares the cumulative total shareholder return to
the Company's shareholders of Common Stock with the cumulative total return of
the peer issuers in the business of Poultry Slaughter & Processing as shown in
the Standard Industrial Classification Code Index for Poultry Slaughter &
Processing (the "SIC Code 2015 Index") and the NASDAQ Market Index. The graph
assumes that one hundred dollars ($100.00) was invested on October 1, 1993 in
each of the Company's Common Stock, the SIC Code 2015 Index and the NASDAQ
Market Index, and that all dividends were reinvested.
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<PAGE>
COMPARE 5-YEAR CUMULATIVE TOTAL RETURN
AMONG RICA FOODS, INC.
NASDAQ MARKET INDEX AND SIC CODE INDEX
[GRAPHIC OMITTED]
1993 1994 1995 1996 1997 1998
---- ---- ---- ---- ---- ----
RICA FOODS, INC 100.00 16.26 11.38 97.56 39.02 43.90
SIC CODE INDEX 100.00 116.63 126.74 126.07 170.68 153.44
NASDAQ MARKET INDEX 100.00 100.83 139.28 165.24 226.81 231.81
- -U.S. COS.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Company has not and does not directly provide any compensation of
any kind to any of its executive officers. Currently, the Company's executive
officers are directly compensated by Pipasa. For fiscal year 1998, the Board of
Directors of Pipasa determined the salaries and directors' fees of the executive
officers of the Company. Such compensation was based on the experience, job
level, and individual performances of the executive officers. As a result of the
foregoing factors, the President and Chief Executive Officer's salary was
increased in 1998. In addition, he received director fees in connection with his
director's duties for one of the Company's subsidiaries, Pipasa. The
determination of this increase was subjective.
The Company's Compensation Committee met once during fiscal year 1998
to determine how the Company or its subsidiaries should provide executive
officer compensation. Presently, the Compensation Committee's two members are
executive officers of the Company. The Compensation Committee's general
philosophy with respect to the compensation of the Company's executive officers
will be to offer competitive compensation programs designed to attract and
retain qualified executives, to motivate performance to achieve specific goals
and to align the interests of senior management with the long-term interests of
the Company's shareholders.
In determining compensation for fiscal year 1998, job level, individual
performance and Company performance are factors that the Compensation Committee
considered. In addition, the Compensation Committee considered the specific
accomplishments of the executive officers, the Company's historical and
projected performance, sales, earnings, financial condition and return on equity
and economic conditions. Consideration of these factors and the ultimate
determination of compensation are subjective. The Company will attempt to
provide incentives
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<PAGE>
to retain qualified executive officers, but also believes that the compensation
paid to its executives is well within the range of compensation paid to
similarly situated executives at other companies in similar industries or at
companies having a similar market capitalization. Given the level of the
Company's executive officer compensation, the committee does not believe that it
is necessary to incur the expense of formal studies or market analysis.
In December 1993, the Internal Revenue Service issued regulations
concerning compliance with Section 162(m) of the Internal Revenue Code of 1986,
as amended (the "Code"). Section 162(m) generally disallows a public company's
deduction for compensation in excess of $1 million per year to the Company's
Chief Executive Officer or any one of the four most highly compensated executive
officers unless certain requirements are met and have been disclosed to
shareholders and approved by a majority of the vote in a separate shareholder
vote before the payment of such compensation. While the tax impact of any
compensation is one factor to consider, such impact is evaluated in light of the
Compensation Committee's overall compensation philosophy. The compensation
committee intends to establish executive officer compensation programs which
will maximize the Company's deduction if the Compensation Committee determines
that such actions are consistent with its philosophy and in the best interests
of the Company and its shareholders.
APPOINTMENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
(PROPOSAL NO. 2)
As recommended by the Audit Committee, the Board of Directors
designated, subject to ratification by the shareholders, the firm of Arthur
Andersen LLP as independent auditors to audit and report on the Company's
financial statements for the fiscal year ended September 30, 1998. Action by
shareholders is not required by law in the appointment of independent auditors,
but their appointment is submitted by the Board in order to give shareholders
the final choice in the designation of independent auditors.
Arthur Andersen LLP has no direct or indirect financial interest in the
Company or in any of its subsidiaries, nor has it had any connection with the
Company or any of its subsidiaries in the capacity of promoter, underwriter,
voting trustee director, officer or employee. Representatives of Arthur Andersen
LLP will be present at the meeting of shareholders and will be afforded an
opportunity to make a statement, if they desire to do so. It is also expected
that they will be available to respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE COMPANY'S
SHAREHOLDERS VOTE "FOR" THE RATIFICATION
OF ARTHUR ANDERSEN LLP AS INDEPENDENT AUDITORS.
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<PAGE>
REPORT ON FORM 10-K
The Company's Annual Report on Form 10-K for the fiscal year ended
September 30, 1998, as filed with the Securities and Exchange Commission, is
available to shareholders, without charge, upon written request directed to
Monica Chaves, Secretary, Rica Foods, Inc., 95 Merrick Way, Suite 507, Coral
Gables, Florida 33134.
OTHER MATTERS
Management knows of no other business to be presented for action at the
Annual Meeting, but if any other business should properly come before the
meeting, it is intended that the proxies will be voted in accordance with the
best judgment of the persons acting thereunder, in their discretion.
By Order of the Board of Directors
Monica Chaves
May 28, 1999 Corporate Secretary
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<PAGE>
RICA FOODS, INC.
95 Merrick Way
Suite 507
Coral Gables, Florida 33134
THIS PROXY IS SOLICITED ON BEHALF OF THE
COMPANY'S BOARD OF DIRECTORS
The undersigned holder of Common Stock of Rica Foods, Inc., a Nevada corporation
("Rica"), hereby appoints Monica Chaves and Jorge M. Quesada, and each of them,
as proxies for the undersigned, each with full power of substitution, for and in
the name of the undersigned to act for the undersigned and to vote, as
designated on the reverse, all of the shares of stock of Rica that the
undersigned is entitled to vote at the 1999 Annual Meeting of Stockholders of
Rica to be held on June 18, 1999 at 10:00 a.m., local time, at the Sheraton
Biscayne Bay Hotel, 495 Brickell Avenue, Miami, Florida, and at any
adjournment(s) or postponement(s) thereof.
(SEE REVERSE SIDE)
<PAGE>
PLEASE SIGN, DATE AND MAIL YOUR
PROXY CARD BACK AS SOON AS POSSIBLE!
ANNUAL MEETING OF STOCKHOLDERS
RICA FOODS, INC.
JUNE 18, 1999
/arrow/ Please Detach and Mail in the Envelope Provided /arrow/
- --------------------------------------------------------------------------------
A [X] PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE
The Board of Directors unanimously recommends a vote FOR
the election of all the nominees for director listed below.
VOTE FOR all nominees
listed below, except vote VOTE WITHHELD
withheld from the following FROM
nominee (if any): ALL NOMINEES
(1) To elect seven (7) [ ] [ ]
directors to the
Board of Directors
of Rica to hold
office until the next Annual Meeting of Stockholders of Rica following their
election or until their successors are duly elected and qualified.
Nominees: Calixto Chaves; Jorge M. Quesada; Luis Guinot, Jr.; Luis Lauredo;
Federico Vargas; Alfred E. Smith IV; and Jose P. Chaves
INSTRUCTION: To withhold authority to vote for any individual nominee, write the
nominee's name in the space provided below.
________________________________________________________________________________
FOR AGAINST ABSTAIN
(2) Ratification of the appointment of Arthur Andersen [ ] [ ] [ ]
LLP to serve as Rica's independent accountants
for the year ended September 30, 1998.
(3) In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the Annual Meeting and any adjournments
or postponements thereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED "FOR" THE ELECTION OF ALL DIRECTOR NOMINEES LISTED ABOVE, AND THE
RATIFICATION OF THE APPOINTMENT OF ARTHUR ANDERSEN LLP.
PLEASE MARK, SIGN AND DATE THIS PROXY CARD AND PROMPTLY RETURN IT IN THE
ENVELOPE PROVIDED. NO POSTAGE NECESSARY IF MAILED IN THE UNITED STATES.
<TABLE>
<S> <C>
Signature _______________________________ Signature if held jointly________________________________ Dated: _________, 1999
(SIGNATURE IF HELD JOINTLY)
</TABLE>
IMPORTANT: Please sign exactly as your name appears hereon and mail it promptly
even though you now plan to attend the meeting. When shares held by
joint tenants, both should sign. When signing as attorney, executor,
administrator, trustee or guardian, please give full title as such.
If a corporation, please sign in full corporate name by president or
other authorized officer. If a partnership please sign in partnership
name by authorized person.
