PILGRIM'S PRIDE CORPORATION
110 SOUTH TEXAS STREET
PITTSBURG, TEXAS 75686
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD WEDNESDAY, FEBRUARY 5, 1997
The Annual Meeting of Stockholders of Pilgrim's Pride Corporation (the
"Company") will be held at the Company's headquarters building, 110 South Texas
Street, Pittsburg, Texas, Wednesday, February 5, 1997, at 11:00 a.m., local
time, to consider the following matters:
1. The election of eleven Directors for the ensuing year;
2. The appointment of Ernst & Young as the Company's independent
auditors for the fiscal year ending September 27, 1997;
3. To transact such other business as may be properly brought before
the meeting or any adjournment. No other matters are expected to be voted
on at the meeting.
The Board of Directors has fixed the close of business on December 20,
1996, as the record date for determining stockholders of record entitled to
notice of, and to vote at, the meeting.
RICHARD A. COGDILL
Pittsburg, Texas EECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER,
January 8, 1997 SECRETARY AND TREASURER
YOUR VOTE IS IMPORTANT!
PLEASE SIGN AND RETURN THE ACCOMPANYING PROXY.
PILGRIM'S PRIDE CORPORATION
110 SOUTH TEXAS STREET
PITTSBURG, TEXAS 75686
PROXY STATEMENT
GENERAL INFORMATION
The Board of Directors of Pilgrim's Pride Corporation (the "Company")
solicits stockholders' proxies in the accompanying form for use at the Annual
Meeting of Stockholders to be held on February 5, 1997, at 11:00 a.m., local
time, at the Company's headquarters at 110 South Texas Street, Pittsburg, Texas
and at any adjournments thereof (the "Meeting"). This Proxy Statement, the
accompanying proxy card and the Company's 1996 Annual Report to Stockholders
are being mailed, beginning on or about January 8, 1997, to all stockholders
entitled to receive notice of, and to vote at, the Meeting.
The principal executive offices of the Company are located at 110 South
Texas Street, Pittsburg, Texas 75686. Any writing required to be sent to the
Company should be mailed to this address.
OUTSTANDING VOTING SECURITIES
Each stockholder of record at the close of business on December 20, 1996
(the "Record Date"), will be entitled to one vote for each share of the
Company's common stock held on the Record Date. The accompanying proxy card
indicates the number of shares to be voted. On December 20, 1996, there were
27,589,250 shares of the Company's common stock issued and outstanding.
VOTING OF PROXIES
Because many of the Company's stockholders are unable to attend the
Meeting, the Board of Directors solicits proxies by mail to give each
stockholder an opportunity to vote on all items of business scheduled to come
before the Meeting. Each stockholder is urged to:
(1) read carefully the material in this Proxy Statement;
(2) specify his or her voting instruction on each item by marking the
appropriate boxes on the accompanying proxy card; and
(3) sign, date and return the card in the enclosed, postage prepaid
envelope.
The accompanying proxy card provides a space, with respect to the election
of Directors, for a stockholder to withhold voting for any or all nominees for
the Board of Directors, but does not permit a stockholder to vote for any
nominee not named on the proxy card. The card also allows a stockholder to
abstain from voting on any item if the stockholder chooses to do so.
When the accompanying proxy card is properly executed and returned with
voting instructions with respect to any of the items to be voted upon, the
shares represented by the proxy will be voted in accordance with the
stockholder's directions by the persons named on the card as proxies of the
stockholders. If a proxy card is signed and returned, but no specific voting
instructions are given, the shares represented by the proxy card will be voted
for the election of the eleven nominees for Directors named on the accompanying
proxy card and for the appointment of Ernst & Young as the Company's
independent auditors.
Unless otherwise indicated by the stockholder, returned proxy cards also
confer upon the persons named on the card, as proxies for the stockholder,
discretionary authority to vote all shares of stock represented by the proxy
card on any item of business that is properly presented for action at the
Meeting, even if not described in this Proxy Statement. If any of the nominees
for Director named below should be unable or unwilling to accept nomination,
the proxies will be voted for the election of such other person as may be
recommended by the Board of Directors. The Board of Directors, however, has no
reason to believe that any item of business not set forth in this Proxy
Statement will come before the Meeting or that any of the nominees for Director
will be unavailable for election.
The proxy does not affect a stockholder's right to vote in person at the
Meeting. If a stockholder executes a proxy, he or she may revoke it at any
time before it is voted by submitting a new proxy card, or by communicating his
or her revocation in writing to the Secretary of the Company or by voting by
ballot at the Meeting.
VOTES REQUIRED
The holders of at least a majority of the shares of the Company's common
stock outstanding on the Record Date must be present in person or by proxy at
the Meeting for the Meeting to be held. Abstentions and broker non-votes are
counted in determining whether at least a majority of the shares of the
Company's common stock outstanding on the Record Date are present at the
Meeting. Directors will be elected by a plurality of the votes cast at the
Meeting. The affirmative vote of a majority of the shares represented and
entitled to vote at the Meeting is required for the appointment of the
Company's independent auditors and approval of any other item of business to be
voted upon at the Meeting. Abstentions are counted in tabulations of the votes
cast on proposals presented to stockholders, whereas broker non-votes are not
counted for purposes of determining whether a proposal has been approved.
Lonnie "Bo" Pilgrim owned or controlled 18,006,630 shares (65.3%) of the
Company's common stock on the Record Date and thus will be able to elect all of
the nominees for Directors and to approve Ernst & Young as independent auditors
for the Company.
STOCKHOLDER PROPOSALS FOR 1998 ANNUAL MEETING
Under the rules of the Securities and Exchange Commission, in order to be
included in the Company's Proxy Statement for the 1998 Annual Meeting of
Stockholders, a stockholder proposal must be received by the Secretary of the
Company no later than the close of business on September 11, 1997.
COST OF PROXY SOLICITATION
The Company will bear the cost of the Meeting and the cost of soliciting
proxies in the accompanying form, including the cost of mailing the proxy
material. In addition to solicitation by mail, Directors, officers and other
employees of the Company may solicit proxies by telephone or otherwise. They
will not be specifically compensated for such services. The Company will
request brokers and other custodians, nominees and fiduciaries to forward
proxies and proxy soliciting material to the beneficial owners of the Company's
common stock and to secure their voting instructions, if necessary. The
Company will reimburse them for the expenses in so doing.
BOARD OF DIRECTORS
The Board of Directors has the responsibility for establishing board
corporate policies and for the overall performance of the Company. However, it
is not involved in day-to-day operating details. Members of the Board are kept
informed of the Company's business through discussions with the Chairman and
other officers, by reviewing analyses and reports sent to them each month, as
well as by participating in Board and committee meetings.
BOARD COMMITTEES
To assist in carrying out its duties, the Board of Directors has delegated
certain authority to the Audit and Compensation Committees. The Board of
Directors does not maintain a Nominating Committee. The members of the Audit
Committee are Robert E. Hilgenfeld, Vance C. Miller, Sr. and James G. Vetter,
Jr. The members of the Compensation Committee are Lonnie "Bo" Pilgrim, Robert
E. Hilgenfeld, Vance C. Miller, Sr., Lonnie Ken Pilgrim, James G. Vetter, Jr.,
Donald L. Wass and Charles L. Black. Each Committee meets to examine various
facets of the Company's operations and take appropriate action or make
recommendations to the Board of Directors. The Audit Committee's
responsibilities include making recommendations to the Board of Directors
regarding the selection of independent public accountants and reviewing the
plan and results of the audit performed by the public accountants of the
Company and the adequacy of the Company's systems of internal accounting
controls, and monitoring compliance with the Company's conflicts of interest
and business ethics policies. The Compensation Committee reviews the Company's
remuneration policies and practices and establishes the salaries of the
Company's officers.
MEETINGS
During the Company's fiscal year ending September 28, 1996, there were six
meetings of the Board of Directors, two meetings of the Audit Committee, and
one meeting of the Compensation Committee. During fiscal 1996, each member of
the Board of Directors attended at least 75% of the aggregate number of
meetings of the Board and Board Committees on which the Director served.
ELECTION OF DIRECTORS
At the meeting, eleven Directors are to be elected, each to hold office for
one year or until his successor is duly elected and qualified. It is intended
that the shares represented by the enclosed proxy will be voted for the
election of the eleven nominees named below. The Board of Directors has no
reason to believe that any nominee will be unable to serve if elected. In the
event any nominee shall become unavailable for election, it is intended that
such shares will be voted for the election of a substitute nominee selected by
the Board of Directors.
NOMINEES FOR DIRECTOR
The following information sets forth the name and principal occupation of
each Director and nominee for Director, his age, his position with the Company
and the date he first became a Director and an executive officer.
LONNIE "BO" PILGRIM, 68, has served as Chairman of the Board and Chief
Executive Officer since the organization of the Company in 1968. Prior to the
incorporation of the Company, Mr. Pilgrim was a partner in the Company's
predecessor partnership business founded in 1946.
CLIFFORD E. BUTLER, 54, serves as Vice Chairman of the Board and Executive
President. He joined the Company as Controller and Director in 1969, was named
Senior Vice President of Finance in 1973, became Chief Financial Officer and
Vice Chairman of the Board in July 1983 and effective January 1, 1997 he became
Executive President and continues to serve as Vice Chairman of the Board.
LINDY M. "BUDDY" PILGRIM, 42, serves as President and Chief Operating
Officer of the Company. He was elected as Director in March 1993 and began
employment in April 1993 under the title of President of U.S. Operations and
Sales and Marketing. From April 1993 to March 1994, the President and Chief
Operating Officer reported to him. After that time, the Chief Operating
Officer title and responsibilities were incorporated into his own. Up to
October 1990, Mr. Pilgrim was employed by the Company for 12 years in marketing
and 9 years in operations. From October 1990 to April 1993, he was President
of Integrity Management Services, Inc., a consulting firm to the food industry.
He is a nephew of Lonnie "Bo" Pilgrim.
ROBERT L. HENDRIX, 60, has been Executive Vice President, Operations, of
the Company since March 1994. Prior to that he served as Senior Vice President,
NETEX Processing from August 1992 to March 1994 and as President and Chief of
Complex Operations from September 1988 to March 1992. He was on leave from the
Company from March 1992 to August 1992. He was President and Chief Operating
Officer of the Company from July 1983 to September 1988. He began as Senior
Vice President in September 1981 when Pilgrim's Pride acquired Mountaire
Corporation of DeQueen, Arkansas, and, prior thereto, he was Vice President of
Mountaire Corporation.
JAMES J. MINER, PH.D., 68, has been Senior Vice President, Technical
Services, since April 1994. He has been employed by the Company and its
predecessor partnership since 1966 and served as Senior Vice President
responsible for live production and feed nutrition from 1968 to April 1994. He
has been a Director since the incorporation of the Company in 1968.
LONNIE KEN PILGRIM, 38, has been employed by the Company since 1977 and
has served the Company as its Vice President, Director of Transportation and as
a member of the Board of Directors since March 1985. He is a son of Lonnie
"Bo" Pilgrim.
JAMES G. VETTER, JR., 62, has practiced law in Dallas, Texas, since 1966.
He is a member of the Dallas law firm of Godwin & Carlton, P.C., and has served
as general counsel and a Director since 1981. Mr. Vetter is a Board Certified-
Tax Law Specialist and serves as a lecturer and author in tax matters.
ROBERT E. HILGENFELD, 71, was elected a Director in September 1986. Mr.
Hilgenfeld was Senior Vice President--Marketing/Processing for the Company from
1969 to 1972 and for seventeen years prior to that worked in various sales and
management positions for the Quaker Oats Company. From 1972 until April 1986,
he was employed by Church's Fried Chicken Company ("Church's") as Vice
President--Purchasing Group, Vice President and Senior Vice President. He was
elected a Director of Church's in 1985 and retired from Church's in April 1986.
Since retirement he has served as a consultant to various companies including
the Company.
VANCE C. MILLER, SR., 62, was elected a Director in September 1986. Mr.
Miller has been Chairman of Vance C. Miller Interests, a real estate company
formed in 1977 and has served as the Chairman of the Executive Committee and as
a director of Henry S. Miller Co., a real estate brokerage firm, since 1980.
DONALD L. WASS, PH.D., 64, was elected a Director of the Company in May
1987. He has been President of the William Oncken Company of Texas, a time
management consulting company, since 1970.
CHARLES L. BLACK, 67, was President, Chief Executive Officer and Director
of NationsBank, Mt. Pleasant, Texas, from December 1981 to his retirement in
February 1995. He previously was a Director of the Company from 1968 to August
1992 and has served as a director since his re-election in February 1995.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
During fiscal 1996, the members of the Company's Compensation Committee
were: Lonnie "Bo" Pilgrim, Robert E. Hilgenfeld, Vance C. Miller, Sr., James
G. Vetter, Jr., Donald L. Wass and Charles L. Black. Lonnie Ken Pilgrim was
elected to the Compensation Committee in fiscal 1997.
The Company has been and continues to be a party to certain transactions
with Lonnie "Bo" Pilgrim and a law firm affiliated with James G. Vetter, Jr.
These transactions, along with all other transactions between the Company and
affiliated persons, require the prior approval of the Audit Committee of the
Board of Directors.
The Company's transactions with Lonnie "Bo" Pilgrim, Chairman of the Board
and Chief Executive Officer of the Company, have allowed the Company to obtain
the use of required production facilities and equipment on terms which
management believes are not less favorable to the Company than could have been
arranged with unaffiliated person. Since 1985, Lonnie "Bo" Pilgrim, Chairman
of the Board and Chief Executive Officer of the Company, has engaged in chicken
grow-out operations with the Company which involve the purchase of chicks, feed
and veterinary and technical services from the Company and the growing-out of
chickens to maturity at which time they are purchased by the Company. Chicks,
feed and services are purchased from the Company for their fair market value,
and the Company purchases the mature chickens from Mr. Pilgrim at market-quoted
prices at the time of purchase. Management of the Company believes that this
operation is conducted on terms not less favorable than those which could be
arranged with unaffiliated persons. During fiscal year 1996, the Company paid
Mr. Pilgrim, doing business as Pilgrim Poultry G.P. ("PPGP"), $18,057,000 for
chickens produced in his grow-out operations, and PPGP paid the Company
$18,112,000 for chicks, feed and services. Lonnie "Bo" Pilgrim is the sole
proprietor of PPGP.
PPGP also produces eggs for the Company. In addition to the chicken grow-
out operations described above, PPGP contracts with the Company to house and
care for Company flocks used for egg production and is paid an egg grower fee
based on actual production. The egg grower contract between PPGP and the
Company renews automatically as each expended flock of laying hens is replaced
by a new flock. The contract is cancelable by either party at any time prior
to the time when the then current producing flock is 48 weeks old. Flocks are
normally replaced every 14 months. Management of the Company believes that
these relationships are on terms not less favorable to the Company than those
which could be arranged with unaffiliated persons. During fiscal year 1996,
the Company paid contract egg grower's fees to PPGP of $4,697,000.
Since 1985, the Company has leased an airplane from Mr. Pilgrim under a
lease agreement which provides for monthly lease payments of $33,000 plus
operating expenses, which terms management of the Company believes to be
substantially similar to those obtainable from unaffiliated parties. During
fiscal 1996, the Company had lease expenses of $396,000 and operating expense
of $88,000 associated with the use of this airplane.
Historically, much of the Company's debt has been guaranteed by the major
stockholders of the Company. In consideration of such guarantees, the Company
has paid such stockholders a quarterly fee equal to .25% of the average
aggregate outstanding balance of such guaranteed debt. During fiscal 1996, the
Company incurred $1,027,000 for such guarantees and paid $807,000 to Lonnie
"Bo" Pilgrim and $47,500 to each of his three children (including Lonnie Ken
Pilgrim, a Director of the Company).
Godwin & Carlton, P.C., has represented and currently represents the
Company in connection with a variety of legal matters. James G. Vetter, Jr.,
is a Director of the Company and is an Executive Vice President of Godwin &
Carlton, P.C. During fiscal year 1996, the Company paid Godwin & Carlton,
P.C., legal fees of $363,385 in connection with such matters.
Mr. Hilgenfeld, a member of the Company's Compensation Committee, served as
an officer of the Company prior to 1973.
COMPENSATION
EXECUTIVE COMPENSATION
The following table sets forth a summary of compensation paid to the
Company's Chief Executive Officer and its four other most highly compensated
executive officers.
SUMMARY COMPENSATION TABLE
Annual Compensation
Other Annual All Other
NAME AND PRINCIPAL POSITION Fiscal Year Salary Bonus Compensation Compensation(1)
Lonnie "Bo" Pilgrim 1996 $475,065 $123,443 $26,518 $10,763
Chairman of the Board and 1995 463,016 277,530 17,591 10,359
Chief Executive Officer 1994 452,077 477,943 -- 19,525
Clifford E. Butler 1996 253,368 65,836 7,505 6,204
Vice Chairman of the Board and 1995 246,942 148,016 7,160 9,665
Executive President 1994 241,107 254,902 7,214 5,164
Lindy M. Pilgrim 1996 329,378 270,622 9,275 6,871
President and 1995 321,022 192,419 9,145 10,273
Chief Operating Officer 1994 313,440 331,374 9,173 3,974
David Van Hoose 1996 248,400 65,545 6,000 7,634
President, 1995 242,100 145,114 6,000 10,988
Mexican Operations 1994 162,375 171,665 3,894 3,058
Robert L. Hendrix 1996 248,400 64,545 10,200 7,777
Executive Vice President, 1995 242,100 145,114 8,948 11,486
Operations 1994 192,231 230,230 8,175 3,873
_____________________
(1) Includes the following items of compensation:
a. Company's contribution to the named individual under its 401(k)
Salary Deferral Plan in the following amounts: Lonnie "Bo" Pilgrim, $52 (1996,
1995 & 1994); Clifford E. Butler, $5,033 (1996), $8,543 (1995), $3,936 (1994);
Lindy M. Pilgrim, $5,028 (1996), $8,453 (1995), $3,974 (1994); David Van Hoose,
$4,913 (1996), $8,315 (1995), $2,585 (1994); and Robert L. Hendrix, $5,028
(1996), $8,543 (1995) $2,677 (1994).
b. Section 79 income to the named individual due to group term life
insurance in excess of $50,000 in the following amounts: Lonnie "Bo" Pilgrim,
$10,711 (1996), $10,307 (1995), $19,473 (1994); Clifford E. Butler, $1,171
(1996), $1,122 (1995), $1,228 (1994); Lindy M. Pilgrim, $1,843 (1996), $1,820
(1995); David Van Hoose, $2,721 (1996), $2,673 (1995), $473 (1994); and Robert
L. Hendrix, $2,749 (1996), $2,943 (1995), $1,196 (1994).
DIRECTORS' FEES
The Company pays its Directors who are not employees of the Company $4,000
per meeting attended, plus expenses.
REPORT OF COMPENSATION COMMITTEE
The Compensation Committee establishes executive compensation and oversees
the administration of the bonus plan for key members of management and the
Company's employee benefit plans.
The following is a report submitted by the Compensation Committee members
in their capacity as the Board's Compensation Committee, addressing the
Company's compensation policy as it related to the named executive officers for
fiscal 1996.
PERFORMANCE MEASURES
The Compensation Committees' establishment of annual executive
compensation is a subjective process in which the Committee considers many
factors including the Company's performance as measured by earnings for the
year, each executive's specific responsibilities, the contribution to the
Company's profitability by each executive's specific areas of responsibility,
the level of compensation believed necessary to motivate and retain qualified
executives, and the executive's length of time with the Company.
FISCAL COMPENSATION
For fiscal 1996 the Company's executive compensation program consisted of
(a) base salary, (b) a discretionary bonus based upon the factors described
above, (c) the bonus plan described below, (d) company contributions to the
Company's 401(k) salary deferral plan which are made up of mandatory
contributions of one dollar per week and matching contributions of up to five
dollars per week and additional matching contributions of up to four percent of
an executive's compensation subject to an overall Company contribution limit of
five percent of domestic income before taxes, and (e) Company contributions to
the Employee Stock Investment Plan in an amount equal to 33 1/3 percent of the
officers' payroll deduction for purchases of the Company's common stock under
the plan, which deductions are limited to 7 1/2 percent of the officer's base
pay.
In establishing the fiscal 1996 compensation to Lonnie "Bo" Pilgrim, the
Company's Chief Executive Officer, the Compensation Committee adjusted Mr.
Pilgrim's base salary by 2.6% to reflect changes in cost of living and his
bonus was determined pursuant to the bonus plan discussed below. No
discretionary bonuses were awarded to Mr. Pilgrim for fiscal 1996.
The Company's objective is to obtain financial performance that achieves
increased return on equity, sales volume, earnings per share and net income.
The Committee believes that linking executive compensation to corporate
performance results in a better alignment of compensation with corporate goals
and shareholder interests.
The Company maintains a bonus plan which provides for five percent of the
Company's domestic income before income taxes{ } to be allocated among certain
key members of management. Prior to fiscal 1995, the bonus was determined
based on the Company's total consolidated income before income taxes. The
change was made to restrict the base for determining such bonuses to domestic
income only because a majority of the participants have little or no management
responsibilities over the Company's Mexican operations. Such amount is
allocated among all plan participants based upon the ratio of each
participant's salary to the aggregate salaries of all participants and the
number of months of the fiscal year the participant was approved for
participation. Currently, there are 15 participants in the plan, including the
Chief Executive Officer, the Executive President, the President and Chief
Operating Officer, the President, Mexican Operations, the two Executive Vice
Presidents, Senior Vice Presidents and two other designated employees.
Participants may be added or removed from the plan at the discretion of the
Compensation Committee. Participants must continue to be employed by the
Company on January 1 following the end of a fiscal year in order to be paid a
bonus with respect to that year. Bonuses are typically paid during the January
following the fiscal year with respect to which the bonus has been granted.
Lonnie "Bo" Pilgrim
Robert E. Hilgenfeld
Vance C. Miller, Sr.
Lonnie Ken Pilgrim
James G. Vetter, Jr.
Donald L. Wass
Charles L. Black
COMPANY PERFORMANCE
The following graph shows a five year comparison of cumulative total
returns for the Company, the Russell 2000 composite index and an index of peer
companies selected by the Company.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN*
AMONG PILGRIM'S PRIDE CORPORATION, THE RUSSELL 2000 INDEX AND A PEER GROUP
RESEARCH DATA GROUP Total Return - Data Summary
Cumulative Total Return
-----------------------------------------------------------------------------
9/29/91 9/28/92 9/26/93 10/02/94 10/01/95 9/30/96
PILGRIM'S PRIDE CORPORATION 100 93 122 146 120 132
PEER GROUP 100 108 147 189 174 185
RUSSELL 2000 100 109 145 149 184 208
The total cumulative return on investment (change in the year end stock
price plus reinvested dividends) for each of the periods for the Company, the
Russell 2000 composite index and the peer group is based on the stock price or
composite index at the end of fiscal 1991.
The above graph compares the performance of the Company with that of the
Russell 2000 composite index and a group of peer companies with the investment
weighted on market capitalization. Companies in the peer group are as follows:
Golden Poultry Company, Inc., Hudson Foods, Inc., Sanderson Farms, Inc.,
Cagles, Inc. and the Company. These companies were selected because of their
similar operations and market capitalizations relative to the Company and were
approved by the Compensation Committee.
CERTAIN OTHER TRANSACTIONS
The Company has entered into chicken grower contracts involving farms
owned by certain of its officers, providing the placement of Company-owned
flocks on their farms during the grow-out phase of production. The contracts
are on terms substantially the same as contracts entered into by the Company
with unaffiliated parties and can be terminated by either party upon completion
of the grow-out of each flock. The aggregate amounts paid by the Company to
its officers and Directors under grower contracts during the fiscal year 1996
were as follows: Clifford E. Butler--$177,908 and James J. Miner--$246,671.
See "Compensation Committee Interlocks and Insider Participation" for a
discussion of the Company's transactions with Lonnie "Bo" Pilgrim, Lonnie Ken
Pilgrim and James G. Vetter, Jr.
Archer-Daniels-Midland Company ("ADM") is one of several vendors selling
feed ingredients to the Company in the ordinary course of business. During
fiscal 1996, the Company purchased $23.2 million of feed ingredients from ADM.
The Company purchases such feed at prices based on the quoted market prices at
the time of purchase. See "Security Ownership" below for ADM's current
ownership.
SECURITY OWNERSHIP
The following table sets forth, as of November 30, 1996, certain
information with respect to the beneficial ownership of the Company's common
stock by (i) each stockholder beneficially owning at least 5% of the Company's
outstanding common stock; (ii) each director of the Company who is a
stockholder of the Company; (iii) each of the executive officers listed in the
executive compensation table who is a stockholder of the Company; and (iv) all
executive officers and directors of the Company as a group.
Amount and
Nature of Percent
Beneficial of
NAME OF BENEFICIAL OWNERS Ownership Class
Lonnie "Bo" Pilgrim (a)(b)(c)(d) 18,006,630 65.3%
110 South Texas Street
Pittsburg, Texas 75686
Archer-Daniels-Midland Company (e) 5,514,900 20.0
P.O. Box 1470
Decatur, Illinois
Lonnie Ken Pilgrim (a)(c)(d) 528,966 1.9
Clifford E. Butler (d) 27,009 (f)
Lindy M. "Buddy" Pilgrim(d) 19,454 (f)
Robert L. Hendrix(d) 21,287 (f)
David Van Hoose(d) 12,470
James J. Miner(d) 12,268 (f)
James G. Vetter, Jr. 1,550 (f)
Donald L. Wass 100 (f)
All executive officers and directors as a group (18) person 18,129,539 65.7%
___________________
(a) Includes 60,387 shares held of record by Pilgrim Family Trust I, an
irrevocable trust dated June 16, 1987, for the benefit of Lonnie "Bo" Pilgrim's
surviving spouse and children, of which Lonnie Ken Pilgrim and Patty R.
Pilgrim, Lonnie "Bo" Pilgrim's wife, are co-trustees, and 60,386 shares held of
record by Pilgrim Family Trust II, an irrevocable trust dated December 23,
1987, for the benefit of Lonnie "Bo" Pilgrim and his children, of which Lonnie
"Bo" Pilgrim and Lonnie Ken Pilgrim are co- trustees. Mr. Lonnie "Bo" Pilgrim
disclaims any beneficial interest in the shares held by his children.
(b) Includes 1,109,817 shares owned of record and beneficially by Mr. Lonnie
"Bo" Pilgrim's three adult children, including Lonnie Ken Pilgrim, a Director
of the Company whose shares are also shown separately. Lonnie "Bo" Pilgrim
disclaims any beneficial interest in the shares held by his three adult
children.
(c) Includes 81,469 shares held in seven trusts dated December 15, 1989,
December 21, 1990, and October 31, 1994, for the benefit of Mr. Lonnie "Bo"
Pilgrim's five minor grandchildren. Mr. Lonnie "Bo" Pilgrim is not a trustee
of these trusts and disclaims any beneficial interest in the shares held by the
trusts.
(d) Includes shares held in trust by the Company's 401(k) Salary Deferral
Plan.
(e) As reported in its Statement of Changes in Beneficial Ownership on Form 4
dated December 1, 1993.
(f) Less than 1%.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors, and persons who own more than ten percent of
the Company's common stock, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission and the New York Stock
Exchange. Officers, directors and greater than ten-percent shareholders are
required by SEC regulation to furnish the Company with copies of all Section
16(a) forms they file.
Based on its review of the copies of such forms received by it, the
Company believes that all filing requirements applicable to its officers,
directors and greater than ten-percent beneficial owners were complied with.
ITEM 2. APPOINTMENT OF INDEPENDENT AUDITORS
The Board of Directors recommends the appointment of Ernst & Young as the
Company's independent auditors for the 1997 fiscal year. This firm of
certified public accountants has served as independent auditors of the Company
pursuant to annual appointment by the Board of Directors since 1969 except for
1982 and 1983.
Representatives of Ernst & Young are expected to be present at the Meeting
and to be available to respond to appropriate questions. They will be given
the opportunity to make a statement if they wish to do so.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPOINTMENT OF ERNST &
YOUNG AS THE COMPANY'S INDEPENDENT AUDITORS FOR FISCAL YEAR 1997.
FINANCIAL STATEMENTS AVAILABLE
FINANCIAL STATEMENTS FOR THE COMPANY ARE INCLUDED IN THE ANNUAL REPORT TO
STOCKHOLDERS FOR THE YEAR 1996. ADDITIONAL COPIES OF THESE STATEMENTS, AS WELL
AS FINANCIAL STATEMENTS FOR PRIOR YEARS AND THE ANNUAL REPORT TO THE SECURITIES
AND EXCHANGE COMMISSION ON FORM 10-K, MAY BE OBTAINED WITHOUT CHARGE FROM THE
SECRETARY OF THE COMPANY, 110 SOUTH TEXAS STREET, PITTSBURG, TEXAS 75686.
FINANCIAL STATEMENTS ARE ALSO ON FILE WITH THE SECURITIES AND EXCHANGE
COMMISSION, WASHINGTON, D.C. 20549, AND THE NEW YORK STOCK EXCHANGE.
OTHER BUSINESS
The Board of Directors is not aware of, and it is not anticipated that
there will be presented to the Meeting, any business other than the election of
the Directors and the proposal to appoint Ernst & Young independent auditors
described above. If other matters properly come before the Meeting, the
persons named on the accompanying proxy card will vote the returned proxies as
the Board of Directors recommends.
Please date, sign and return the proxy at your earliest convenience. A
prompt return of your proxy will be appreciated as it will save the expense of
further mailing.
By order of the Board of Directors
RICHARD A. COGDILL
EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER
SECRETARY AND TREASURER
Pittsburg, Texas
January 8, 1997
[ x ]
Please mark
your votes
as this
-------------------
COMMON
1. ELECTION OF DIRECTORS:
FOR all nominees TO WITHHOLD AUTHORITY
listed at right to vote for all
(except as marked nominees listed
to the contrary) at right
[ ] [ ]
Lonnie "Bo" Pilgrim James J. Miner Robert E. Hilgenfeld
Clifford E. Butler Lonnie Ken Pilgrim Vance C. Miller, Sr.
Lindy M. Pilgrim James G. Vetter, Jr. Donald L. Wass
Robert L. Hendrix Charles L. Black
(INSTRUCTION: To withhold authority to vote for any individual nominee,
write that nominee's name on the line provided below.)
- --------------------------------------------------------------------------------
2. The appointment of Ernst & Young as independent auditors for the Company
for the fiscal year.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
- -------------------------------------------------------------------------------
3. In their discretion such other business as may properly come before the
Annual Meeting.
UNLESS OTHERWISE SPECIFIED ON THIS PROXY, THE SHARES REPRESENTED BY THIS PROXY
WILL BE VOTED "FOR" THE ELECTION OF MANAGEMENT'S NOMINEES FOR DIRECTORS AND
"FOR" PROPOSAL 2 ABOVE. DISCRETION WILL BE USED WITH RESPECT TO SUCH OTHER
MATTERS AS MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENT THEREOF.
____________________________________________________________________
Date
____________________________________________________________________
Signature of Stockholder
____________________________________________________________________
Signature if held jointly
Please date this proxy and sign your name exactly as it appears hereon.
Persons signing in a representative capacity should indicate their capacity.
A proxy for shares held in joint ownership should be signed by each owner.
Please Execute This Proxy and Return Promptly in the
Enclosed Self-Addressed Stamped Envelope.
PILGRIM'S PRIDE CORPORATION
110 SOUTH TEXAS STREET
PITTSBURG, TEXAS 75686
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Lonnie "Bo" Pilgrim and Clifford E.
Butler, and each of them, as Proxies, each with the power to appoint his
substitute, and hereby authorizes them, and each of them, to represent and to
vote, as designated below, all the shares of Common Stock of Pilgrim's Pride
Corporation held of record by the undersigned on December 20, 1996 at the
Annual Meeting of Stockholders to be held on February 5, 1997 or any
adjournment thereof.
(CONTINUED ON OTHER SIDE)
