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Exhibit 4.1
To Annual Report
 
on Form 10-K for Fiscal 2024
Of Cal-Maine Foods, Inc.
 
 
DESCRIPTION OF CAPITAL STOCK
The amount of capital stock which Cal-Maine Foods, Inc. (the “Company” or “Corporation”)
 
is authorized to issue (the “Capital
Stock”) is 124,800,000
 
shares, consisting of
 
(a) 120,000,000 shares
 
of Common
 
Stock with a
 
par value
 
of One Cent
 
($.01) per
share and (b) 4,800,000 shares of Class A Common Stock with a par value of One Cent ($.01) per share.
The
 
following
 
summary
 
describes
 
the
 
Capital
 
Stock
 
under
 
the
 
Company’s
 
Second
 
Amended
 
and
 
Restated
 
Certificate
 
of
Incorporation (the
 
“Restated Charter”)
 
and Amended and Restated
 
Bylaws (“the
 
Bylaws”). The summary
 
may not be
 
complete
and is subject
 
to, and qualified
 
in its entirety by,
 
the applicable provisions
 
of Delaware law and
 
the terms and
 
provisions of our
Restated Charter and our Bylaws.
 
You should refer to, and read this
 
summary together with, our Restated Charter and
 
our Bylaws
to review all provisions applicable to our Capital Stock that may be important
 
to you.
Equal Treatment
Except as otherwise provided in the Restated Charter
 
as described below, or required by applicable
 
law, shares of Common Stock
and Class A
 
Common Stock shall have the same rights and powers, rank equally (including as to dividends and distributions, and
upon any
 
liquidation, dissolution
 
or winding
 
up of
 
the Corporation),
 
share ratably
 
and be
 
identical in
 
all respects
 
and as
 
to all
matters.
Voting Rights
Holders of shares of Capital Stock vote as a single class on all matters submitted to a vote of the stockholders, with each share of
Common Stock entitled to one vote
 
and each share of Class A
 
Common Stock entitled to ten votes.
 
Holders of Capital Stock have
the right
 
of cumulative
 
voting in
 
the election
 
of directors.
 
Cumulative voting
 
means that
 
each stockholder
 
is 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, and
such stockholder may cast all of such votes for a single director or may distribute
 
them among the number to be voted for, or for
any two or more of them as such stockholder may see fit.
Under Delaware
 
law, the affirmative
 
vote of the
 
holders of a
 
majority of the
 
outstanding shares of
 
any class of
 
Capital Stock is
required to approve, among other
 
things, any amendment to the
 
certificate of incorporation that would
 
alter or change the
 
powers,
preferences
 
or special
 
rights of
 
such class
 
so as
 
to affect
 
such class
 
adversely. In
 
addition, as
 
long as
 
any of
 
the shares
 
of the
Class A Common
 
Stock are
 
outstanding,
 
the consent
 
of not
 
less than
 
66 2/3
 
% of
 
the total
 
shares of
 
Class A Common
 
Stock
outstanding is required to
 
(1) alter or change the rights
 
and privileges of Class A Common Stock;
 
(2) to amend any provision of
Paragraph 4 of the Restated Charter affecting the Class A
 
Common Stock or (3) effect any re-classification or re-capitalization of
the Company’s Capital Stock.
Dividends
Holders of
 
shares of
 
Capital Stock
 
are entitled
 
to receive
 
such dividends
 
as may
 
be declared
 
by our
 
Board of
 
Directors out
 
of
funds legally available for such purpose.
Shares of Common
 
Stock and Class A Common
 
Stock are required
 
to be treated
 
equally, identically
 
and ratably, on
 
a per share
basis, with respect to any dividends or distributions as may be declared and paid from time to time by the Board of Directors out
of any assets of the Company legally available therefor.
However, in the event a dividend is paid in the form of
 
shares of Capital Stock (or rights to acquire such shares), then
 
holders of
Common Stock shall receive
 
shares of Common Stock
 
(or rights) and holders of
 
Class A Common Stock shall receive shares of
Class A Common
 
Stock (or
 
rights), with
 
holders of
 
shares of
 
Common Stock
 
and Class A Common
 
Stock receiving,
 
on a
 
per
share basis, an identical number of shares of Common Stock or Class A Common Stock, as applicable.
Exhibit 4.1
To Annual Report
 
on Form 10-K for Fiscal 2024
Of Cal-Maine Foods, Inc.
 
 
Notwithstanding the foregoing, the
 
Board of Directors may
 
pay or make a
 
disparate dividend or distribution
 
per share of
 
Common
Stock or Class A Common
 
Stock (whether
 
in the amount
 
of such dividend
 
or distribution payable
 
per share,
 
the form
 
in which
such dividend
 
or distribution
 
is payable,
 
the timing
 
of the
 
payment,
 
or otherwise)
 
if such
 
disparate dividend
 
or distribution
 
is
approved in advance by the affirmative vote of the holders of a majority of the outstanding shares of Common Stock and Class
 
A
Common Stock, each voting separately as a class.
Ownership of Class A Common Stock
The Class A Common
 
Stock may
 
only be
 
issued to
 
Immediate Family
 
Members and
 
Permitted Transferees
 
(each as
 
defined in
the
 
Restated
 
Charter,
 
and
 
as
 
summarized
 
below).
 
In
 
the
 
event
 
any
 
share
 
of
 
Class A Common
 
Stock,
 
by
 
operation
 
of
 
law
 
or
otherwise is, or
 
shall be deemed
 
to be owned
 
by any person
 
other than
 
an Immediate Family
 
Member or
 
Permitted Transferee,
such share of Class A Common Stock shall
 
automatically convert into
 
Common Stock, whereby the
 
voting power of such
 
stock
would be reduced from ten votes per share to one vote per share.
The
 
term
 
“Immediate
 
Family
 
Member”
 
includes:
 
the
 
natural
 
children
 
(the
 
“Daughters”)
 
of
 
our
 
late
 
founder
 
and
 
Chairman
Emeritus Fred R. Adams, Jr., his sons-in-law (including
 
our Chairman Adolphus B. Baker), and his grandchildren,
 
including the
estates of all of such persons.
The term “Permitted Transferee” includes:
(i)
 
an Immediate Family Member;
(ii)
 
a trust
 
held for
 
the sole
 
or primary
 
benefit of
 
one or
 
more Immediate
 
Family Members
 
or Permitted
 
Transferees,
including any trustee in such trustee’s capacity as such,
 
provided that if a trust is not for the sole benefit of
 
one or more
Immediate
 
Family
 
Members
 
or
 
Permitted
 
Transferees,
 
an
 
Immediate
 
Family
 
Member
 
or
 
Permitted
 
Transferee
 
must
retain sole
 
dispositive and
 
exclusive power
 
to direct
 
the voting
 
of the
 
shares of
 
Class A Common Stock
 
held by
 
such
trust;
(iii)
 
a corporation, limited liability company or partnership, including but not limited to, a family limited partnership or
similar limited liability
 
company or corporation,
 
or a single
 
member limited
 
liability company, provided
 
that all of
 
the
equity interest in
 
such entity is owned,
 
directly or indirectly,
 
by one or more
 
Immediate Family Members
 
or Permitted
Transferees and an
 
Immediate Family Member
 
or Permitted Transferee retains
 
sole dispositive and
 
exclusive power to
direct the voting of the shares of Class A Common Stock held by such entity;
 
(iv)
 
a qualified
 
Individual Retirement
 
Account, pension,
 
profit sharing,
 
stock bonus
 
or other
 
type of
 
plan or
 
trust of
which an Immediate
 
Family Member or Permitted
 
Transferee is a participant
 
or beneficiary, provided that
 
in each case
an Immediate Family Member or
 
Permitted Transferee retains sole dispositive and
 
exclusive power to direct the voting
of the shares of Class A Common Stock held by such account, plan or trust; or
(v)
 
any guardianship, conservatorship or custodianship
 
for the benefit of an Immediate Family
 
Member who has been
adjudged
 
disabled,
 
incapacitated,
 
incompetent
 
or
 
otherwise
 
unable
 
to
 
manage
 
his
 
or
 
her
 
own
 
affairs
 
by
 
a
 
court
 
of
competent jurisdiction, including any guardian,
 
conservator or custodian in
 
such guardian’s, conservator’s or
 
custodian’s
capacity as such.
Other Provisions
The holders of Common Stock and Class A Common Stock are not entitled to preemptive or subscription rights.
Exhibit 4.1
To Annual Report
 
on Form 10-K for Fiscal 2024
Of Cal-Maine Foods, Inc.
 
 
Unless approved in advance by the affirmative vote of the holders of
 
a majority of the outstanding shares of Common Stock and
Class A Common
 
Stock,
 
each
 
voting
 
separately
 
as
 
a
 
class,
 
shares
 
of
 
Common
 
Stock
 
or Class
 
A Common
 
Stock
 
may
 
not
 
be
subdivided, combined
 
or reclassified unless
 
the shares of
 
the other class
 
are concurrently therewith
 
proportionately subdivided,
combined
 
or
 
reclassified
 
in
 
a
 
manner
 
that
 
maintains
 
the
 
same
 
proportionate
 
equity
 
ownership
 
between
 
the
 
holders
 
of
 
the
outstanding Common Stock and Class A
 
Common Stock on the record date for such subdivision, combination or reclassification.
Unless approved in advance by the affirmative vote of the holders of
 
a majority of the outstanding shares of Common Stock and
Class A Common
 
Stock, each
 
voting separately
 
as a
 
class, upon
 
the dissolution,
 
liquidation or
 
winding up
 
of the
 
corporation,
whether voluntary
 
or involuntary,
 
holders of
 
Common Stock
 
and Class A Common
 
Stock will
 
be entitled
 
to receive
 
ratably all
assets of the Corporation available for distribution to its stockholders.
In the event of
 
(i) a merger, consolidation
 
or other business combination
 
requiring the approval of
 
the holders of the
 
Corporation’s
capital stock entitled to vote thereon, (ii) a tender or exchange offer to acquire any shares of Common Stock or Class
 
A Common
Stock by a third party pursuant to
 
an agreement to which the Corporation is
 
a party, or (iii) a tender or exchange
 
offer to acquire
any
 
shares of
 
Common
 
Stock or
 
Class A Common
 
Stock
 
by the
 
Corporation,
 
holders of
 
the
 
Common
 
Stock and
 
the Class
 
A
Common Stock
 
shall have the
 
right to receive,
 
or the right
 
to elect to
 
receive, the
 
same form and
 
amount of
 
consideration on
 
a
per share basis.
 
Each share
 
of Class A Common
 
Stock is
 
convertible, at
 
the option
 
of its
 
holder, into
 
one share
 
of Common
 
Stock at
 
any time.
Once shares of Class A Common Stock are
 
converted into Common
 
Stock, the shares of Class A Common Stock
 
will be retired
and
 
may
 
not
 
be
 
reissued. The
 
number
 
of
 
shares
 
of
 
Common
 
Stock
 
into
 
which
 
the
 
shares of
 
Class A Common
 
Stock
 
may
 
be
converted is
 
subject to
 
adjustment from
 
time to
 
time in
 
the event
 
of any
 
capital reorganization,
 
reclassification of
 
stock of
 
the
Company or consolidation
 
or merger of the Company with or into another corporation.
The
 
Restated
 
Charter
 
includes
 
a
 
sunset
 
provision
 
pursuant
 
to
 
which
 
all
 
of
 
the
 
outstanding
 
Class
 
A
 
Common
 
Stock
 
will
automatically
 
convert
 
to
 
Common
 
Stock
 
if:
 
(a)
 
less
 
than
 
4,300,000
 
shares
 
of
 
Class A
 
Common
 
Stock,
 
in
 
the
 
aggregate,
 
are
beneficially owned by Immediate
 
Family Members and/or Permitted
 
Transferees, or (b) if less
 
than 4,600,000 shares
 
of Class A
Common Stock
 
and Common Stock,
 
in the aggregate,
 
are beneficially owned
 
by Immediate Family
 
Members and/or Permitted
Transferees.
Control by Immediate Family Members, Anti-Takeover Considerations and Forum for Adjudication of Disputes
General
Mr. Adams founded the Company
 
and served as its CEO
 
from the formation
 
of the Company in 1969
 
until 2010, when his son-
in-law, Mr. Baker,
 
became CEO.
 
Mr. Adams died
 
on March
 
29, 2020.
 
Mr. Baker
 
stepped down
 
from CEO
 
in September
 
2022,
and remains Chairman of the Board and as an executive officer of the Company.
As of July
 
23, 2024, a
 
limited liability company
 
(the “Daughters’
 
LLC”), owned by
 
Mr.
 
Adams’
 
son-in-law Mr. Baker,
 
Mr. Baker’s
spouse and
 
her three
 
sisters (Mr. Adams’
 
four
 
daughters) (collectively,
 
the “Family”),
 
owns 100%
 
of our
 
outstanding Class
 
A
Common Stock
 
(which has
 
10 votes
 
per share),
 
controlling approximately
 
52.0% of
 
our total
 
voting power. As
 
sole managing
member of
 
the Daughters’ LLC,
 
Mr. Baker
 
controls the
 
vote of
 
100% of
 
our outstanding
 
Class A Common
 
Stock, except
 
that
certain extraordinary matters requiring the vote
 
of the Company’s stockholders such as
 
a merger or amendment of
 
the Company’s
Restated Charter require
 
joint approval of
 
Mr. Baker and
 
members of the
 
Daughters’
 
LLC holding a
 
majority of its
 
voting interests.
Family members also
 
have additional voting
 
power due to beneficial
 
ownership of our
 
Common Stock (which has
 
one vote per
share), directly or
 
indirectly through the
 
Daughter’s LLC and
 
other entities, resulting
 
in family voting
 
control of approximately
53.8%
 
of
 
our
 
total
 
voting
 
power.
 
The
 
Daughters’
 
LLC
 
and
 
its
 
members
 
are
 
all
 
Immediate
 
Family
 
Members
 
or
 
Permitted
Transferees as defined in the Restated Charter.
Exhibit 4.1
To Annual Report
 
on Form 10-K for Fiscal 2024
Of Cal-Maine Foods, Inc.
 
 
The Common
 
Stock is
 
listed on
 
The Nasdaq
 
Global Select
 
Market (“Nasdaq”)
 
and qualifies
 
as a
 
“controlled company”
 
under
Nasdaq’s rules. As a
 
controlled company, the Company is not subject to certain Nasdaq listing standards such
 
as those that would
otherwise
 
require
 
that
 
a
 
majority
 
of
 
a
 
listed
 
company’s
 
directors
 
be
 
independent
 
and
 
that
 
a
 
compensation
 
committee
 
and
nominating committee of the board of directors composed solely of independent
 
directors be established. Although not required,
the Company’s
 
board is comprised
 
of a majority
 
of independent directors
 
and the compensation
 
committee is comprised
 
solely
of independent directors.
 
The Company is,
 
however, subject to
 
Nasdaq’s listing standards
 
requiring that the
 
audit committee be
composed solely
 
of independent
 
directors. Delaware
 
law provides
 
that the
 
holders of
 
a majority
 
of the
 
voting power
 
of shares
entitled
 
to
 
vote
 
must
 
approve
 
certain
 
fundamental
 
corporate
 
transactions
 
such
 
as
 
a
 
merger,
 
consolidation
 
and
 
sale
 
of
 
all
 
or
substantially all of a corporation’s assets. Immediate Family Members and Permitted Transferees currently hold a majority of the
voting power of all shares of capital stock of the Company and have indicated that they intend to retain ownership of a sufficient
amount of Common Stock and
 
Class A Common Stock to assure continued ownership of more than
 
50% of the voting power of
our outstanding shares of capital stock. Accordingly,
 
a merger, consolidation, sale of all
 
or substantially all of the assets or
 
other
business combination
 
or transaction
 
involving the
 
Company, which
 
requires a
 
stockholder vote,
 
cannot be
 
effected without
 
the
approval of the Immediate Family Members and Permitted Transferees.
As a result, majority control may make an unsolicited acquisition of
 
the Company more difficult and discourage certain types
 
of
transactions involving a change of control of our Company, including transactions in which the holders of Common Stock might
otherwise receive a premium for
 
their shares over then
 
current market prices.
 
Also, the controlling ownership of
 
our Capital Stock
by Immediate Family
 
Members and Permitted Transferees
 
may adversely affect
 
the market price
 
of our Common
 
Stock, due in
part to lack of speculation that there may be a change in control.
Delaware Anti-Takeover Law
We
 
are
 
subject
 
to
 
Section 203
 
(“Section 203”)
 
of
 
the
 
Delaware
 
General
 
Corporation
 
Law.
 
Under
 
this
 
provision,
 
we
 
may
 
not
engage
 
in
 
any
 
“business
 
combination”
 
with
 
any
 
interested
 
stockholder
 
for
 
a
 
period
 
of
 
three
 
years
 
following
 
the
 
date
 
the
stockholder became an interested stockholder, unless:
i.
 
prior to that date our Board of Directors approved either the business combination
 
or the transaction that resulted in the
stockholder becoming an interested stockholder;
ii.
 
upon completion
 
of the
 
transaction that
 
resulted in
 
the stockholder
 
becoming an
 
interested stockholder,
 
the interested
stockholder owned at least 85% of the voting stock outstanding at the
 
time the transaction began; or
iii.
 
on or following
 
that date, the business
 
combination is approved
 
by our Board of
 
Directors and authorized
 
at an annual
or special meeting of stockholders by the affirmative vote of at least two-thirds of the outstanding
 
voting stock that is not owned
by the interested stockholder.
Section 203 defines “business combination” to include, subject to limited exceptions:
i.
 
any merger or consolidation involving the corporation and the interested stockholder;
ii.
 
any sale,
 
transfer, pledge
 
or other
 
disposition of
 
10% or
 
more of
 
the assets
 
of the
 
corporation involving
 
the interested
stockholder;
iii.
 
any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested
stockholder;
iv.
 
any transaction
 
involving the
 
corporation
 
that has
 
the effect
 
of increasing
 
the proportionate
 
share of
 
the stock
 
of any
class or series of the corporation beneficially owned by the interested stockholder; or
Exhibit 4.1
To Annual Report
 
on Form 10-K for Fiscal 2024
Of Cal-Maine Foods, Inc.
 
 
v.
 
the receipt
 
by the
 
interested
 
stockholder of
 
the benefit
 
of any
 
loans, advances,
 
guarantees, pledges
 
or other
 
financial
benefits provided by or through the corporation.
In
 
general,
 
Section 203
 
defines
 
an
 
“interested
 
stockholder”
 
as
 
any
 
entity
 
or
 
person
 
beneficially
 
owning
 
15%
 
or
 
more
 
of
 
the
outstanding voting
 
stock of the
 
corporation and
 
any entity
 
or person affiliated
 
with or controlling
 
or controlled
 
by the entity
 
or
person.
The restrictions of
 
Section 203 of the
 
Delaware General Corporation
 
Law do not
 
apply to corporations
 
that have elected,
 
in the
manner provided therein, not to be subject to Section 203 of
 
the Delaware General Corporation Law. The Company has
 
not made
such an election. Accordingly, the Company would be subject to Section 203 in the event of a business combination.
Forum for Adjudication of Disputes
Article VIII of
 
our Amended and Restated
 
Bylaws provides
 
that, unless the
 
Company consents in
 
writing to the
 
selection of an
alternative
 
forum,
 
the Court
 
of
 
Chancery
 
of the
 
State of
 
Delaware
 
(or
 
if
 
such court
 
does not
 
have
 
subject
 
matter
 
jurisdiction
another state or
 
federal court (as appropriate)
 
located within the
 
State of Delaware)
 
shall, to the
 
fullest extent permitted
 
by law,
be the
 
sole and
 
exclusive forum
 
for (i)
 
any derivative
 
action or
 
proceeding brought
 
on behalf
 
of the
 
Company; (ii)
 
any action
asserting a claim of breach of a
 
fiduciary duty owed by any current
 
or former director, officer or other
 
employee, or stockholder
of the Company to the
 
Company or its stockholders,
 
creditors or other constituents;
 
(iii) any action asserting
 
a claim against
 
the
Company or any current
 
or former director, officer,
 
employee, or stockholder of
 
the Company arising pursuant
 
to any provision
of the DGCL or
 
the certificate of incorporation
 
or the bylaws (as
 
they may be
 
amended and/or restated
 
from time to time)
 
or as
to which the
 
DGCL confers jurisdiction on
 
the Court of
 
Chancery of the
 
State of Delaware;
 
or (iv) any
 
action asserting a claim
governed by the internal
 
affairs doctrine.
 
A stockholder
 
bringing any such action
 
will be deemed to
 
have consented to the
 
personal
jurisdiction of
 
the state and
 
federal courts located
 
within the State
 
of Delaware
 
and to service
 
of process on
 
such stockholder’s
counsel in
 
such action
 
as agent
 
for such
 
stockholder. To
 
the fullest
 
extent permitted
 
by law,
 
any person
 
or entity
 
purchasing or
otherwise
 
acquiring
 
or holding
 
any
 
interest
 
in shares
 
of capital
 
stock
 
of the
 
Company
 
shall
 
be deemed
 
to have
 
notice of
 
and
consented to the provisions of this paragraph.
This choice
 
of forum
 
provision may
 
limit a
 
stockholder’s ability
 
to bring
 
a claim
 
in a
 
judicial forum
 
that it
 
finds favorable
 
for
disputes with us or any
 
of our directors, officers, other
 
employees, or stockholders, which may
 
discourage lawsuits with respect
to such claims.
 
Alternatively, if a court
 
were to find
 
the choice of
 
forum provision to be
 
inapplicable or unenforceable in
 
an action,
we may incur additional
 
costs associated with resolving
 
the matter in the
 
other jurisdiction. This choice of
 
forum provision will
not apply
 
to suits
 
brought to
 
enforce a
 
duty or
 
liability created
 
by the
 
federal securities
 
laws and
 
our stockholders
 
will not
 
be
deemed to have waived (and cannot waive) compliance with the federal
 
securities laws and the rules and regulations thereunder.
 
Transfer Agent
Computershare Trust Company of Louisville, Kentucky, is the Transfer Agent and Registrar for our Common Stock.