Item 5.02 – Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers;
Compensatory Arrangements of Certain Officers.
Appointment of Chief Operating Officer
On March 27,
2023, Cal-Maine Foods,
Inc. (the “Company”)
issued a press
release announcing that
Todd Walters,
Vice President,
Operations, has been appointed Chief Operating Officer effective March 27, 2023.
Walters (age
52) joined
the Company
in 1997.
Since 2011,
he has
served as
Vice President
of Operations
for the
Company’s
operations in
South Texas,
as well
as our
subsidiary Wharton
County Foods,
LLC’s facility
in Boling,
Texas. He
previously served
in management positions at other locations of
the Company in Mississippi, Kansas, New
Mexico, and Ohio. Walters has served
on the Board of The Ohio
Poultry Association and
The Texas Poultry Federation, where
he is currently an ex-officio member.
He
is also
an active
member of
the United
Egg Producers.
Walters is
a graduate
of Mississippi
State University
with a
bachelor's
degree in agriculture with a major in poultry science.
As a member of the
executive management team of the Company, Walters
receives compensation, including base pay, bonuses,
certain employee
benefits, and
awards under
the Company's
long-term incentive
plan. Walters
will receive
a base
pay of
$229,341.
Walter’s will be
eligible to receive
bonus payments under
our general bonus
program. Officers in this
program are eligible
to earn
a bonus equal to 50% of
the sum of the officer’s
base salary plus such officer’s
prior year’s bonus. Walters
will also be eligible
to
receive
stock
grants
under
the
Company’s
long-term
incentive
plan
(“LTIP”)
which
is
administered
by
the
Long-Term
Incentive Plan
Committee. While
the LTIP
Committee has
not developed
formal policies
concerning the
timing of
grants and
other
matters,
its
practice
has
been
to
authorize
grants
of
restricted
shares
annually
in
mid-December,
with
the
grants
being
effective the following
January. Walters will also receive
other customary
benefits provided
to executive
officers of the
Company.
There are no
arrangements or understandings between
Walters and any
other person pursuant
to which Walters was
selected as
an officer of the Company. Walters does not have any family relationship with any director or executive officer of the Company.
There are
no related
party transactions
involving Walters
and the
Company that
require disclosure
under Item
404(a) of
Regulation
S-K.
A copy of the Company’s press release is attached hereto as
Exhibit 99.1 to this Current Report.
Supplemental Executive Retirement Plan and Split Dollar Life Insurance Plan
On March
24, 2023,
the Company
adopted the
Cal-Maine Foods,
Inc. Supplemental
Executive Retirement
Plan (“SERP”),
an
unfunded
deferred
benefit
plan,
and
a
Split
Dollar
Life
Insurance
Plan
(“Split
Dollar Plan”
and
together
with
the
SERP,
the
“Plans”) designed
to provide
deferred compensation
and a
pre-retirement death
benefit for
a select
group of
management or
highly
compensated
employees
of
the
Company.
The
Plans
are
effective
March
1,
2023
and
are
designed
to
be
exempt
from
the
requirements of the
Employee Retirement Income
Security Act of 1974, as
amended (“ERISA”) as
unfunded arrangements for
the benefit of a select group of highly compensated or management employees.
Sherman
Miller,
President
and
CEO,
Max
Bowman,
Vice-President
and
CFO,
and
Rob
Holladay,
Vice-President
–
General
Counsel are participating in the
Plans. Provided the vesting
conditions are met, participants
in the SERP
are eligible to receive an
aggregate Retirement Benefit (as
defined in the SERP) of
$500,000, which is paid in
annual installments of $50,000
for 10 years.
A participant
becomes vested
in the
Retirement Benefit
over five
years of
plan participation
at 20%
per year.
If a
participant
becomes disabled, attains the retirement age of
65, or the Company experiences a change
in control, vesting will be accelerated
to 100%. If a participant dies while employed,
he or she will not receive any benefits
under the SERP, but their beneficiaries will
instead be
entitled to the
life insurance benefit
provided under the
Split Dollar Plan,
which is $500,000.
Participants forfeit all
benefits if terminated for cause.
The Company
has the
right, in
its discretion,
to amend
or terminate
the Plans
at any
time provided
that no
amendment shall
deprive a
participant or beneficiary
of a
vested benefit amount
accrued prior
to the date
of the
amendment without the
written
consent of the
participant or beneficiary. A copy of the
Plans are filed
with this Form
8-K as Exhibits
No. 10.1 and
10.2. As of
the date of this Form 8-K, there are three Participants in the Plans.