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This excerpt taken from the CALM DEF 14A filed Aug 26, 2009. Employee Stock Ownership
Plan
We
maintain a payroll-based ESOP. Pursuant to the ESOP, originally
established in 1976, all full time employees over age 21 with one or more years
of service, participate. Its assets, which currently consist
primarily of common stock of the Company, are managed by a trustee designated by
the Board. Contributions by us 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 percent 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 for calendar year 2008 (up to $230,000
per employee), of all participating employees for calendar year 2008. Company
contributions vest immediately upon the commencement of an employee's
participation in the ESOP.
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. Our contributions to the ESOP
amounted to approximately $1,212,726 in calendar year 2008. For
calendar year 2008, our contributions to the ESOP on behalf of each of the
executive officers named in the Summary Compensation Table were: Mr. Adams –
$6,900; Mr. Baker – $6,900; Mr. Dawson – $6,900; Mr. Scott – $6,900; and Mr.
Wyatt – $6,900. 15
1993
Stock Option Plan
Our 1993
Amended and Restated Stock Option Plan was adopted on May 25, 1993, and amended
and restated on October 10, 1996. This Plan was approved by our
shareholders on May 25, 1993. A total of 1,000,000 shares of our
common stock was reserved for issuance under this Plan.
Inasmuch
as 10 years have passed since the adoption of this Plan, by its terms no more
options may be granted thereunder.
The
exercise price for shares of stock subject to options under the Plan were not
less than 100 percent of fair market value of our common stock on the date of
grant of the options. The shares under this Plan are subject to
adjustment to prevent dilution. There are currently options
outstanding under this Plan for a total of 19,200 shares. All must be
exercised within 10 years of grant. The exercise price is $2.125
(reflects stock split).
Shares
subject to the 1993 Plan have been registered under the Securities Act of
1933.
1999
Stock Option Plan
Our 1999
Stock Option Plan was adopted on April 15, 1999, and approved by the
shareholders on October 11, 1999. Under the 1999 Plan, 1,000,000 shares of
Common Stock were reserved for issuance upon the exercise of options that could
be granted under the 1999 Plan. Options granted under the 1999 Plan
are accompanied by tandem stock appreciation rights ("SARs"). Options
for 1,000,000 shares were awarded on December 13, 1999 by the Board of
Directors.
No
options are presently outstanding under the 1999 Plan. Shares subject
to the 1999 Plan have been registered under the Securities Act of
1933.
2005
Incentive Stock Option Plan
Our 2005
Incentive Stock Option Plan was adopted by our Board of Directors on
August 15, 2005, and ratified by our shareholders on October 13,
2005. Under the 2005 Plan, 500,000 shares of common stock were
reserved for issuance upon the exercise of options that could be granted under
the 2005 plan.
All
options to be granted are intended to qualify as incentive stock options under
Section 422 of the Internal Revenue Code. The options vest at the
rate of 20 percent per year.
The
exercise price per share for any options granted may not be less than 100
percent of the fair market value of the Common Stock on the date of
grant. The number of shares subject to an option and the exercise
price may be adjusted in certain circumstances to prevent
dilution. The method of payment of the exercise price will be as
prescribed by the Board of Directors in the individual stock option
agreements.
The
options presently outstanding, all of which are held by officers of the Company,
total 156,000. The options were granted on August 17, 2005, for an
exercise price of $5.93.
Shares
subject to the 2005 Plan have been registered under the Securities Act of
1933.
Cal-Maine
Foods, Inc. Stock Appreciation Rights Plan
The
Cal-Maine Foods Stock Appreciation Rights Plan (the “SARs Plan”) was adopted by
our Board of Directors on August 15, 2005, and ratified by our shareholders on
October 13, 2005. The SARs Plan covers 1,000,000 shares of common
stock and is administered by the Executive Committee of the Board of
Directors. 16
The SARs
Plan continues for a period of 10 years from August 15, 2005, unless earlier
terminated. SARs vest at the rate of 20 percent per year, are
non-transferable and contain anti-dilution provisions. Upon exercise,
the Company will pay the holder of the SARs an amount in cash equal to the
difference between the fair market value on the date of grant and the fair
market value as of the date of exercise.
As of
August 1, 2009, employees and directors hold a total of 233,250 SARs with a base
price of $5.93 per share, 9,000 SARs with a base price of $6.71 per share, and
12,000 SARs with a base price of $6.93 per share. Shares of common
stock are not issued under the SARs Plan, but only serve as the measure for
determining the amount to be paid by the Company.
As of
August 1, 2009, our independent directors, Dr. Triplett and Ms. Hughes,
each hold 15,000 and 16,250 SARs, respectively, while Mr. Poole holds 15,000
SARs all with a base price of $5.93.
Shares
covered by the SARs Plan are registered under the Securities Act of
1933. The settlement of awards in cash resulted from an amendment to
the SARs Plan on August 24, 2006, as permitted by its terms.
Savings
and Retirement Plan
Since
1985, we have 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 after having attained age 21 and after one year of full time
service. The Retirement Plan permits participants to contribute up to
the maximum allowed by the IRS regulations. Participating employees
are 100 percent vested in their account balances under the Retirement Plan. We
may make discretionary contributions. At the present time, we do not
make discretionary contributions. The Retirement Plan is intended to
comply with the Employee Retirement Income Security Act of 1974, as
amended.
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.
Compensation
Committee Interlocks and Insider Participation
In 1996,
the Board of Directors established a Compensation Committee. As
indicated above, the members of the Committee are Mr. Adams, Chairman of the
Board of Directors and Chief Executive Officer, Mr. Poole, and Dr.
Triplett, independent directors of the Company. Only Mr. Adams is an
employee of the Company.
PROPOSAL
OF THE HUMANE SOCIETY OF THE UNITED STATES
Under
Rule 14a-8 promulgated under the Securities Exchange Act of 1934, as amended, a
shareholder of the Company meeting prescribed eligibility standards may request
that the Company include in its proxy statement a proposal from such eligible
shareholder. The Humane Society of the United States
(the “Humane Society”) has requested its proposal for a resolution to be
adopted by the shareholders of the Company be included in this proxy
statement.
The
Humane Society has furnished evidence of its eligibility to request its proposed
resolution be included in this proxy statement. The full name and
address of the requesting shareholder is The Human Society of the United States,
2100 L Street NW, Washington, D.C. 20037. The Humane Society
beneficially owns 476 shares of the Company’s common stock.
17
The full
text of the resolution submitted by the Humane Society for consideration by the
shareholders of the Company is as follows:
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