Edgar Filing: ALICO INC

SCHEDULE 14A

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934

Filed by the Registrant [ ]
Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the Commission
[X] Definitive Proxy Statement Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12

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ALICO, INC.
(Name of Registrant as Specified in its Charter)

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[ ] Fee paid previously with preliminary materials.
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fee was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.

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ALICO, INC.
Post Office Box 338
La Belle, Florida 33975

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Notice of Annual Meeting of Stockholders
To be held December 5, 2002

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November 8, 2002

To the Stockholders of ALICO, INC.:

NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of ALICO,
INC., a Florida Corporation (the "Company"), will be held at the Holiday Inn
Select, 13051 Bell Tower Drive, Fort Myers, Florida, at Ten O'clock A.M., On
Thursday, December 5, 2002, for the following purposes:

1. To elect ten Directors to serve until the next Annual Meeting of
Stockholders or until their respective successors have been elected and
qualified.

2. To transact such other business as may properly come before the meeting
or any and all adjournments thereof.

Only stockholders of record on the Company's books at the close of business
on October 11, 2002 will be entitled to notice of, and to vote at, said meeting
and any and all adjournments thereof.

If you are unable to attend the meeting in person but wish your shares to
be voted upon the matters to come before it, please complete, sign and date the
accompanying proxy card and mail it in the enclosed envelope. Postage is not
required if mailed in the United States.

A copy of the Company's Forty-Third Annual Report to Stockholders, dated
November 8, 2002, is enclosed herewith.

By Order of the Board of Directors

Denise Plair
Secretary

ALICO, INC.
Post Office Box 338
La Belle, Florida 33975

PROXY STATEMENT
SOLICITATION

November 8, 2002
La Belle, Florida

The Board of Directors of ALICO, INC. (the "Company") hereby solicits
proxies to be used at the Annual Meeting of Stockholders of the Company to be
held on December 5, 2002, and at any and all adjournments thereof, and this
proxy statement is furnished in connection therewith. Every proxy may be revoked
at any time prior to the exercise thereof by any stockholder giving such proxy,
by giving written notice of revocation to the secretary of the Company at or
before the annual meeting by duly executing a subsequent proxy relating to the
same shares or by attending the annual meeting. In addition to the use of the
mails, directors, officers and regular employees of the Company may, without
additional compensation, solicit proxies in person or by telephone, mail or
telegraph. All costs of solicitation will be borne by the Company. Brokerage
houses, bankers and others holding stock in their names or names of nominees or
otherwise will be reimbursed for reasonable out-of-pocket expenses incurred by
them in sending proxies and proxy material to the beneficial owners of such
stock.

It is anticipated that this proxy statement and accompanying notice, form
of proxy card and Company's Annual Report will be first sent to the Stockholders
of the Company on or about November 8, 2002.

VOTING SECURITIES

The Company has only one class of voting securities outstanding, its Common
Stock, $0.35 par value per share of which 7,093,092 were outstanding as of
October 11, 2002. Each share entitles the holder thereof to one vote. Only
stockholders of record at the close of business on October 11, 2002 will be
entitled to vote at the meeting or at any and all adjournments thereof.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AS OF OCTOBER
11, 2002:

(a) Beneficial Ownership of more than 5 percent of Voting Securities:

The following table sets forth certain information as of October 11, 2002,
relating to the beneficial ownership of shares of Common Stock of the Company by
any person known to the Company to be the beneficial owner of more than five
percent (5%) of the Common Stock of the Company. To the best knowledge of the
Company, there are no other persons who own beneficially more than five percent
(5%) of the Company's Common Stock.

Amount and Nature of Percent of
Name and Address of Beneficial Owners Beneficial Ownership Class
------------------------------------- -------------------- ----------

Ben Hill Griffin, III ................... 3,536,226(1) 49.85
P.O. Box 127
Frostproof, FL 33843
Dimensional Fund Advisors, Inc. ......... 408,400 5.76
1299 Ocean Avenue, 11th Floor
Santa Monica, CA 90401
Beck, Mack & Oliver ..................... 363,000 5.12
330 Madison Ave
New York, NY 10017

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(1) Includes 3,493,777 shares held through Ben Hill Griffin Investments, Inc.
(3993 Howard Hughes Parkway, Suite 460, Las Vegas, NV 89109), a wholly
owned subsidiary of Ben Hill Griffin, Inc., of which Mr. Griffin, III may
be considered to be the indirect beneficial owner by virtue of his power to
direct the voting and disposition of such shares of the Company's Common
Stock.

(b) Security Ownership of Management:

Amount and Nature of Percent of
Name of Beneficial Owner Beneficial Ownership Class
------------------------ -------------------- ----------

All Directors and Executive Officers
as a group (10 persons) ........... 3,604,111(1) 50.81

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(1) Includes 3,493,777 shares held through Ben Hill Griffin Investments, Inc.
(3993 Howard Hughes Parkway, Suite 460, Las Vegas NV 89109), a wholly owned
subsidiary of Ben Hill Griffin, Inc., of which Mr. Griffin, III may be
considered to be the indirect beneficial owner by virtue of his power to
direct the voting and disposition of such shares of the Company's Common
Stock.

SECTION 16 (a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

To the Company's knowledge, based solely upon a review of forms 3,4 and 5
and amendments thereto, furnished to the company during it's most recent fiscal
year, all statements of beneficial ownership required to be filed with the
Securities and Exchange Commission in fiscal 2002 were timely filed.

NOMINEES FOR ELECTION AS DIRECTORS

At the Annual Meeting ten Directors will be elected to hold office for the
ensuing year or until their respective successors are duly elected and
qualified. Unless authority is withheld on the attached form of proxy card, such
proxy will be voted FOR the election of the nominees set forth below to serve as
such Directors. All nominees are currently members of the Board of Directors and
have consented to being named in this proxy statement and have notified
management that they will serve, if elected. If any of the nominees should be
unable to serve as a Director, the persons designated as proxies reserve full
discretion to cast their votes for another person in his place. A plurality of
the votes received will elect each director. Abstentions will not be counted for
such purposes.

The Board of Directors recommends that the stockholders vote FOR the
proposal to elect the ten nominees listed below as Directors of the Company.

The information set forth below as to age, shareholdings, and business
experience for the past five years, including principal occupation or employment
(other than with the Company), has been furnished by each nominee.

Shares of Company
Common Stock
Position with Beneficially
Company, if any, Owned as of Percent of
Nominee Age Principal Occupation October 24, 2002 Class
------- --- -------------------- ------------------ ----------

Ben Hill Griffin, III 60 Chairman of the Board Chief Executive 3,536,226(1) 49.85
Frostproof, Florida (2) Officer; Director since 1973. Chairman and
Chief Executive Officer of Ben Hill Griffin,
Inc. (citrus production and packing,
fertilizer manufacturing and ranching
company)

Richard C. Ackert 60 Director since 1998. President and Chief 300 .0042
Fort Myers, Florida Executive Officer of SouthTrust Bank,
Southwest FL (1994 to Present)

William L. Barton 63 Director since 1998. Chairman/CEO Wilson, 500 .007
Naples, Florida Miller, Inc. (1995 to 1999) (Retired)
Director and President Mitigation Land
Partners, Inc. (1999 to Present)

Walker E. Blount, Jr. 82 Director since 1973. Business Advisor to 1,600 .0226
Bartow, Florida Wright, Walker & Company, P.A. (1980-
1987). Vice President & Director, Citrus
and Chemical Bancorporation, Inc. (1980 to
Present) Director, Citrus & Chemical Bank.
(1965 to Present)

Monterey Campbell 72 Director since February 2001. Of Counsel, 215 .0030
Bartow, Florida Gray Harris Robinson, Attorney's At Law.
Judge, Second District Court of Appeal
(1980 to 2001) (Retired)

Amy Gravina 47 Director since 2002. President, Gravina, 0 0
Fort Myers, Florida Smith & Matte (1986 to Present) Director,
Florida Gulf Bank (2001 to Present)

Ben Hill Griffin, IV 34 Director since 1994. President, Ben Hill 2,000 .028
Frostproof, Florida (2) Griffin, Inc. (2001 to Present) Vice
President Ben Hill Griffin, Inc. (1994
to 2001)

K. E. Hartsaw 76 Director since 1991. Partner KPMG LLP 1,000 .0141
Orlando, Florida (Retired 7/1/87) Consultant KPMG LLP
(7/1/86 to 6/30/91)

W. Bernard Lester 63 Director since 1987. President (1998 to 6,820 .0961
La Belle, Florida Present) Chief Operating Officer (1988 to
Present) Executive Vice President (1988
to 1997)

Thomas E. Oakley 60 Director since 1992. President, Oakley 50 .0007
Winter Haven, Florida Transport, Inc. (1968 to Present)
(international food transportation company)

(2) Mr. Griffin, III is father of Mr. Griffin, IV. No other nominees are
related.

REPORT ON BOARD SELECTION/INCLUSIVENESS REVIEW

In recognition of the fact that our employees, customers and stockholders
represent a greater diversity of backgrounds than ever before, in 2002 we
adopted a Policy for Board Inclusiveness Review to ensure that, in seeking
qualified candidates to fill vacancies on our Board of Directors, the Company
makes a greater commitment to locate candidates whose backgrounds reflect the
diversity we see in our employee, stockholder and customer base. While we have
never discriminated against any employee, applicant, board candidate, or anyone
on the basis of race, color, religion, sex, national origin, age, ancestry or
disability, we found that often, in order to achieve diversity, we need to take
more affirmative steps to identify qualified candidates who can enhance our
Board by bringing a different perspective. This does not mean that we will
solicit for association with Alico, Inc. anyone other than those whose skills,
education, experience and performance are of the highest caliber. However, it
does mean that we will actively seek to ensure that our candidate pool includes
persons with diverse backgrounds.

Typically, Board vacancies are filled after considering nominees proposed
by Board members or who come to the attention of the Board through their
performance in areas of benefit to the company. Each nominee's qualifications
are reviewed by the Board, and the final selection is made on the basis of the
nominee whose experience and background are deemed to provide a more valuable
contribution to the Board. On an annual basis, at the shareholder's meeting, the
slate of Board members is put to the shareholders for re-election. Board members
are selected to serve on those committees where their individual talents and
background would most benefit the Company. For the audit committee in
particular, committee members are selected based on their expertise in
accordance with current SEC and Nasdaq rules. These processes will remain the
same, but we have made an increased effort to enlarge our initial candidate
pool. Our Policy of Inclusiveness Review will thus ensure that the candidate
pool is itself diverse, thus making it more likely that the composition of the
Board will also be diverse.

LITIGATION PROCEEDINGS INVOLVING DIRECTORS OR NOMINEES

The Company has been informed by Ben Hill Griffin, III, Chairman of the
Board, that he is party to a lawsuit filed against him in Polk County, Florida
Circuit Court by the families of his four sisters, most of the members of whom
are beneficiaries of a trust, entitled the Ben Hill Griffin, Jr. Revocable Inter
Vivos Trust #1 (the "Trust"). The plaintiffs in the lawsuit (The Four Sisters
Protectorate, et al. v. Ben Hill Griffin, III, Trustee, Case No. GC-G-0054,
Section 81) sought to impose judicial sanctions on Mr. Griffin, III, including
his removal as Trustee of the Trust based on allegations of over-compensation
and receipt of an illegal bonus. On March 29, 2001, after court-ordered
mediation pending completion of which the trial was adjourned, Mr. Griffin, III
and a representative of the Four Sisters Protectorate, joined by their
respective counsel, executed a "Settlement Agreement" which set forth the basic
elements of a settlement of the lawsuit, contingent upon several events,
including Internal Revenue Service approval of the proposed transaction as a tax
free split-off for federal income tax purposes, and the Court's judicial
termination of the Trust. The terms contained in the "Settlement Agreement" were
not intended, nor were they sufficient, to resolve all specific items necessary
to consummate a

settlement of the lawsuit. The Settlement Agreement provided that the shares of
Alico stock then owned by Ben Hill Griffin Investments, Inc., would be utilized
in the tax free split-off, along with other assets, as a means of allocating to
the Four Sisters Protectorate assets approximating the value of their interests
in Ben Hill Griffin Investments, Inc., a holding company wholly owned by the
Trust, Ben Hill Griffin, III, the Four Sisters Protectorate and its members.

Mr. Griffin, III has indicated that following execution of the Settlement
Agreement the parties disagreed as to its validity or enforceability on various
grounds. On May 14, 2001, the Harris Family filed a motion in the Circuit Court
of the 10th Judicial Circuit in and for Polk County, Florida (Case No.
GC-G-0054) seeking to have the Settlement Agreement set aside as invalid and
unenforceable. On November 2, 2001 the Court entered a written order that the
Settlement Agreement is enforceable. The Harris family has filed an appeal, in
response to the order. Mr. Griffin, III has informed the Company that the issues
related to the mechanism and terms of the proposed distribution of certain of
the assets of the Trust to the families of the four sisters, including the Alico
stock beneficially owned by the Trust, have been worked out between the
representatives of the four sisters and Ben Hill Griffin, III and are set forth
in a definitive separation agreement. The Company further understands that
consummation of the settlement continues to be subject to certain conditions
which are still pending, specifically, the Harris family litigation. The Company
has been informed by Mr. Griffin, III that the parties have received a favorable
IRS Revenue Ruling. Neither the Company nor Mr. Griffin, III or his attorneys
know when the settlement will be implemented but believe related litigation
proceedings could take 6 months to a year to be resolved.

Mr. Griffin, III has also informed the Company that immediately before the
hearing on the enforcement of the State court action, lawyers for the Harris
family provided Mr. Griffin, III's attorneys with copies of a federal court
action naming among others as defendants, Mr. Griffin, III, individually and as
Trustee of the Ben Hill Griffin, Jr. Revocable Inter Vivos Trust #1, and BHG,
Inc. According to Mr. Griffin, III's attorneys, this litigation was filed in the
federal district court for the Northern District of Florida (Case No: 4:olcv
432-5PM). The complaint, among other things, seeks to set aside the settlement
agreement based on alleged violations of the securities laws, fraud, and
negligence. This suit was filed on October 2, 2001. Mr. Griffin, III's attorneys
have indicated that they believe this suit is without merit, if not frivolous,
and have stated that Mr. Griffin, III will defend it vigorously.

Since the Company opted out of the Florida Business Corporation Act's
provision on Affiliated Transactions and Control Share Acquisitions (currently
FBCA s. 607.0901 and s. 607.0902) under the predecessor statutes to such
sections, transactions contemplated by the Settlement Agreement may not be
subject to shareholder approval or review by the Company's Board of Directors.

DIRECTORS' COMPENSATION, COMMITTEES OF THE
BOARD OF DIRECTORS AND CERTAIN MEETINGS

The Company's Board of Directors held 15 meetings in fiscal 2002. Each
member of the Board of Directors, including employees of the Company, received
$1,000 for each board meeting attended. During the year ended August 31, 2002,
no director attended fewer than 75% of the aggregate of (1) the total number of
meetings of the Board and (2) the total number of meetings of all the Committees
of the Board on which he served.

The Company has an Executive Committee, an Audit Committee and a
Compensation Committee; it does not have a Nominating Committee.

The Executive Committee, which exercises, to the extent permitted by
Florida Law, all the powers of the Board of Directors during intervals between
Board meetings, consists of Ben Hill Griffin, III, W. Bernard Lester and Ben
Hill Griffin, IV. The Executive Committee met 7 times during fiscal 2002. No
compensation is paid for executive committee meetings.

The Audit committee, which is composed of six independent non-employee
directors, met twice during the fiscal year. The principal functions of the
Audit Committee are to recommend to the Board of Directors the engagement of the
Company's independent public accountants, to review with such accountants the
plan for and results of their examination of the financial statements of the
Company, to determine the independence of such accountants, and to review the
adequacy of the system of internal accounting controls, procedures and
practices.

The Audit Committee operates pursuant to a Charter approved by the Board, a copy
of which was attached to last year's Proxy Statement. All members of the Audit
Committee are independent directors as defined by the National Association of
Securities Dealers listing standards. Each outside director received $1,000 for
the committee meetings, and the chairman received $1,250.

The Compensation Committee reviews the compensation of the executive
officers of the Company and makes recommendations to the Board of Directors
regarding such compensation. The Compensation Committee met two times during the
fiscal year 2002. Outside directors were paid $1,000 for the committee meetings,
and the chairman was paid $1,250.

Audit Committee Report

The Committee has prepared the following report on its activities with
respect to the Company's audited financial statements for the fiscal year ended
August 31, 2002 (the "audited financial statements").

o The Committee has reviewed and discussed the audited financial
statements with management of the Company.

o The Committee has discussed with KPMG LLP, the Company's independent
auditors, the matters required to be discussed by Statement on Auditing
Standards No. 61.

o The Committee has received the written disclosures and the letter from
KPMG LLP required by Independence Standards Board Standard No. 1, and has
discussed with KPMG LLP its independence from the Company.

o Based on and relying on the review and discussions described above, the
Committee has recommended to the Board of Directors that the audited financial
statements be included in the Company's Annual Report on Form 10-K for the
fiscal year ended August 31, 2002, for filing with the U.S. Securities and
Exchange Commission.

AUDIT COMMITTEE

Richard C. Ackert, Chairman
William L. Barton
Walker E. Blount, Jr.
Monterey Campbell
Amy Gravina
Thomas E. Oakley

Compensation Committee Interlocks and Insider Participation

The Compensation Committee of the Board is composed of six directors:
Walter E. Blount, Jr., Richard C. Ackert, William L. Barton, Monterey Campbell,
Amy Gravina, Thomas E. Oakley and none of whom is an officer or employee of the
Company or its subsidiaries. In addition, there are no interlocking
relationships between any of these directors and any other executive officer of
the Company.

Compensation Committee Report

The Company's general compensation philosophy aims to provide base
compensation comparable with similar Florida businesses, allowing the Company to
attract and retain qualified employees. In addition, the Company provides
incentive compensation through a bonus program which is dependent on the
individual's performance and which will also vary with the Company's
performance. Accordingly, while the executive compensation program provides an
overall level of compensation that is competitive within the Florida
agribusiness industry, actual compensation levels in any given year may be
greater or less than average competitive levels in comparable companies,
depending on the Company's overall performance for such year and on the specific
individual's performance or contribution to the Company. As additional incentive
compensation, the Company adopted the 1998 Incentive Equity Plan, pursuant to
which employees of the Company may be selected by the Board, in the Board's sole
discretion, to receive stock options, restricted stock awards, or stock
appreciation rights.

The Compensation Committee, comprised of independent directors on the
Company's Board of Directors, reviews executive compensation and determines
compensation levels which it then recommends to the Board of Directors. In
determining the base compensation and any bonuses to be awarded to its
executives, the Compensation Committee uses no set formula but rather evaluates
a series of factors, including but not limited to (i) industry performance for
such year, (ii) the Company's performance as compared to others in the industry
that year, (iii) the Company's performance for such year as compared to the
Company's performance with the pervious year, and (iv) the individual's
performance or contributions for such year as compared with such individual's
performance or contributions the previous year, if applicable. In addition, the
Compensation Committee will, in its discretion, evaluate other external and
internal factors affecting performance, including individual circumstances.

The Chief Executive Officer's compensation is established using the same
criteria as set forth above generally for executive compensation. For fiscal
2002, Mr. Ben Hill Griffin, III's base salary was comparable to that of the
previous year, with a bonus award reflecting the Company's performance vis a vis
comparable businesses and Mr. Griffin's contribution to such performance. In
addition to his base salary and bonus pursuant to the terms of the Company's
1998 Incentive Equity Plan, Mr. Griffin received a grant of options to purchase
12,500 shares of the Company's common stock on September 11, 2001. The exercise
price was based on the market price of the Company's common stock on August 31,
2001. Other Company employees also received stock options as part of their
compensation during 2002.

Certain non-performance-based compensation to executives of public
companies in excess of $1,000,000 is not deductible for tax purposes. It is the
responsibility of the Compensation Committee to determine whether any actions
with respect to this compensation limit should be taken by the Company. During
fiscal year 2002 no executive officers of the Company received any compensation
in excess of this limit nor is it anticipated that any executive officer will
receive any such compensation during fiscal year 2003. Therefore, the
Compensation Committee has not taken any action to date to comply with this
limit.

COMPENSATION COMMITTEE

Walker E. Blount, Jr., Chairman
Richard C. Ackert
William L. Barton
Monterey Campbell
Amy Gravina
Thomas E. Oakley

EXECUTIVE OFFICERS

The following table sets forth certain information on the Named Executive
Officers other than those already listed in the table for Nominees for Election
as Directors:

Name and Age of
Executive Officer Position and Background with the Company
----------------- ----------------------------------------

L. Craig Simmons ......... 50 Vice President and Chief Financial Officer
La Belle, Florida (since February 7, 1995)

EXECUTIVE COMPENSATION

The following table sets forth all cash compensation paid or to be paid by
the Company to the executive officers of the Company, identifying those whose
cash and non-cash compensation exceeded $100,000:

SUMMARY COMPENSATION TABLE

Annual Compensation Securities
Fiscal ----------------------- Underlying All Other
Name and Principal Position Year Salary (a) Bonus (b) Options/SAR (c) # Compensation (d)
--------------------------- ------ ---------- --------- ----------------- ----------------

Ben Hill Griffin, III .......... 2002 $335,000 $206,000 12,500 $ 44,371
Chairman and Chief 2001 281,767 222,000 12,500 44,107
Executive Officer 2000 239,870 222,000 11,651 45,052

W. Bernard Lester .............. 2002 251,200 171,000 12,500 84,097
President and Chief 2001 235,600 202,000 12,500 83,847
Operating Officer 2000 223,200 185,000 11,651 63,846

L. Craig Simmons ............... 2002 86,666 20,275 5,000 30,974
Vice President and 2001 77,200 23,450 5,000 32,999
Chief Financial Officer 2000 67,100 20,025 4,112 33,744

All Executive Officers ......... 2002 672,866 397,275 30,000 159,442
as a group (d) 2001 594,567 447,450 30,000 160,953
2000 530,170 427,025 27,414 142,642

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(a) Represents total cash compensation earned.

(b) Represents compensation for discretionary cash bonuses which are based on
individual and company performance.

(d) Represents Company contributions to the Employees' Profit Sharing Plan, a
nonqualified defined benefit retirement plan and Directors' Fees for
Messrs. Griffin, III and Lester (2002 - $15,000 each; 2001 - $15,200 each;
2000 - $13,000 each, respectively.)

The following table sets forth stock options granted during fiscal 2002 to
each of the Company's executive officers named in the Summary Compensation Table
and stock options granted to all employees as a group. The table also sets forth
the hypothetical gains that would exist for the options at the end of their
ten-year terms for the executive officers named in the Summary Compensation
Table and for all employees as a group (assuming their options had ten-year
terms) at assumed compound rates of stock appreciation of 5% and 10%. The actual
future value of the options will depend on the market value of the Company's
Common Stock. All option exercise prices are based on market price on the date
of grant.

Option/SAR Grants in Last Fiscal Year

Individual Grants (a)
----------------------------------------------- Potential Realizable Value
Number of Percent of Total at Assumed Annual Rates
Securities Options/SARs Exercise of Stock Price Appreciation
Underlying Granted to or Base for Option Term (b)
Options/SARSs Employees Price --------------------------------
Name Granted (#) in Fiscal Year ($Sh) 0%($) 5%($) 10% ($)
---- ------------- ---------------- -------- ------ -------- ----------

Ben Hill Griffin, III ............ 12,500 22.48 15.68 -- 123,264 312,365

W. Bernard Lester ................ 12,500 22.48 15.68 -- 123,264 312,365

L. Craig Simmons ................. 5,000 8.99 15.68 -- 49,306 124,946

All Employees as a group ......... 55,598 100.00 (c) -- 548,260 1,389,350

------------
(a) Options and stock appreciation rights granted under the Incentive Equity
Plan (the "Plan") to the Company's executive officers named in the Summary
Compensation Table, are first exercisable on August 31, 2002. The Company
issued stock appreciation rights, during fiscal 2002, to each of the
executive officers named in the Summary Compensation Table.

(b) These amounts, based on assumed appreciation rates of 0% and 5% and 10%
rates presented by the Securities and Exchange Commission rules, are not
intended to forecast possible future appreciation, if any, of the Company's
stock price.

(c) Options and stock appreciation rights granted under the Plan during fiscal
2002 were all granted on September 11, 2001, became exercisable on August
31, 2002, and have a contractual life of ten years expiring August 31,
2012. The exercise price of all options granted to employees during fiscal
2002 is $15.68.

(d) No gain to the optionees is possible without an increase in stock price,
which will benefit all stockholders.

Common Stock Performance

The following graph compares the value of $100 invested on September 1,
1996 in the Company's common stock, the S&P 500 and a Company-constructed peer
group. The S&P 500 index represents a broad equity index and the peer group
index consists of four companies, all of which are agribusiness concerns, one
of which is based in Florida: Alexander & Baldwin, Inc., Consolidated Tomoka
Land Co., Scheid Vineyards, Inc., and Tejon Ranch Co. The total return includes
the reinvestment of dividends. There can be no assurance that the Company's
stock performance will continue in the future with the same or similar trends
depicted in the graph below:

[THE FOLLOWING DATA WAS ALSO REPRESENTED AS A LINE CHART IN THE PRINTED
MATERIAL.]

Base
Period Years Ending
Aug 97 Aug 98 Aug 99 Aug 00 Aug 01 Aug 02
------ ------ ------ ------ ------ ------

ALICO INC. ................ 100.00 75.25 71.41 72.24 135.73 140.91
S&P 500 INDEX (1) ......... 100.00 108.09 151.14 175.81 132.93 109.01
PEER GROUP (2) ............ 100.00 78.30 91.28 94.10 102.73 91.99

------------
(1) Total return calculations for the S&P 500 Index were performed by Standard
& Poor's Compustat Services, Inc.

(2) Total return calculations for the peer group index (consisting of four
companies) were performed by Standard and Poor's Compustat Services, Inc.

Contingent Compensation

1998 Incentive Equity Plan

The Company maintains an incentive equity plan (the "Incentive Equity
Plan") pursuant to which Board members and employees selected by the Board of
Directors may receive options to purchase Company common stock, awards of
restricted stock, and stock appreciation rights (SARs). The purpose of the plan
is to advance the interests of the company and its stockholders by offering
participants an opportunity to acquire or increase their proprietary interests
in the Company, and thereby receiving additional incentives to achieve the
Company's objectives. No stock options, SARs or restricted stock may be granted
under the plan on or after the tenth anniversary of the plan's effective date.
The Incentive Equity Plan is administered by the Board of Directors.

Pension and Profit Sharing

The Company operates a Profit Sharing Plan under Section 401 (k) of the
Internal Revenue Code (the "Plan"). Under this Plan a regular employee of the
Company becomes eligible to participate upon employment provided he or she
continues such employment through the following August 31. Vesting of the Plan
begins after two (2) years of service with the Company at which time an employee
becomes 20% vested. Vesting increases by 20% with each additional year of
service. Employees become fully vested upon completion of six (6) years of
service.

The Plan is fully funded by contributions by the Company, except for such
contributions of employees electing to take advantage of the salary reduction
feature (Section 401 (k) Internal Revenue Code). Contributions by the Company
are determined by its Board of Directors from time to time with allocations to
employee accounts based on each participant's salary. The Plan also includes a
voluntary employee contribution provision pursuant to Section 40l (k) of the
Internal Revenue Code which allows employees to contribute up to 20% of their
salary, or a maximum of $11,000. All 40l (k) accounts are 100% vested.

Employees will be deemed 100% vested and receive full benefits from the
Plan, regardless of their standing on vesting schedules, upon retirement on or
after age 65, death or permanent disability. Benefits commence within 60 days
after request following one of the qualifying events, referred to above, and can
be taken as periodic payments or in a lump sum. For the year ended August 31,
2002, the Company contributed a total of $284,649 to the Profit Sharing Plan.

Additional Plan

The Company has a nonqualified defined benefit retirement plan, which
covers officers of the Company, as well as certain management and key personnel
(the "Nonqualified Plan"). The Nonqualified Plan is being funded by the purchase
of insurance contracts and is designed to provide a set monthly benefit after
the participant reaches ages 65. The participants are required to pay a portion
of the cost of the Nonqualified Plan and the Company pays the remaining amount.
The expense and monthly benefit amount are based on the participant's annual
salary and age at the date of entry into the Nonqualified Plan.

Pension expense for the additional retirement benefits was approximately
$488,000, $395,000 and $128,000 for the years ended August 31, 2002, 2001 and
2000, respectively.

INTEREST OF MANAGEMENT IN CERTAIN TRANSACTIONS

Effective Novmber 2, 1983, the Company entered into a continuing marketing
contract covering the majority of its citrus crop with Ben Hill Griffin, Inc., a
company which is controlled by Ben Hill Griffin, III, the Company's Chairman of
the Board and Chief Executive Officer. This contract provides for modifications
to meet changing conditions and cancellation by either party by giving notice
prior to August first preceding the next fruit season. Modifications to the
terms of the contract are made upon the mutual agreement of both parties and can
relate to numerous provisions of the contract including the quantity of fruit to
be delivered and service fees to be collected by Ben Hill Griffin, Inc. Such
modifications may be necessary depending on factors such as weather and general
market conditions. During the year ended August 31, 2002 approximately 77
percent of the Company's crop was marketed under this contract. Under the terms
of this contract, the Company's fruit is

harvested, packed and/or otherwise processed and sold along with fruit from
other growers, including Ben Hill Griffin, Inc., and the proceeds distributed on
a pro rata basis as sales of the finished product are made by the buyer. The
Company bears the cost of harvesting. The co-mingling of fruit with other
growers permits Alico to participate in the negotiation of higher prices from
buyers that would not likely be available if price negotiations were limited
only to Alico's fruit. The marketing contract also permits Alico's fruit to be
sold in either fresh or processed form, in whichever market will provide the
highest return. Historically, this contract has provided highly competitive
returns. Ben Hill Griffin, Inc. receives a handling fee and a marketing fee out
of sales proceeds. The assistance provided for by the contract is considerable
and reduces the number of staff which the Company would otherwise have to
employ. Additionally, the Company may receive advances on sales which are then
deducted from its share of the distributed proceeds. Substantially all of the
2002-2003 citrus crop will be marketed under the terms of this contract; also,
Ben Hill Griffin, Inc. provides harvesting services for citrus sold to unrelated
processors. The total amount paid to Ben Hill Griffin, Inc., under the terms of
the marketing contract, for harvesting and other costs was $7,125,761 during the
year ended August 31, 2002. In addition Griffin was paid $2,006,535 for
harvesting citrus sold to unrelated processors. These charges are comparable to
similar services available in the industry.

The Company purchased from Ben Hill Griffin, Inc., on a competitive bid
basis, fertilizer, spray, herbicides and other miscellaneous supplies at a total
cost of $6,202,461 during the year.

INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

The firm of KPMG LLP, Certified Public Accountants, 111 North Orange
Avenue, Suite 1600, Orlando, Florida 32801, has served as the Company's
independent certified public accountants since January 1, 1984. In addition to
performing the year-end audit of the financial statements, the independent
public accountant: (1) performs a limited review of the quarterly financial
statements, reviews the financial information included in the annual report to
shareholders and the Forms 10-Q and 10-K filed with the Securities and Exchange
commission; and (2) prepares the federal and state income tax returns. All
services performed by the independent accountants are approved by the Audit
Committee of the Board of Directors prior to performance.

Representatives of KPMG LLP are expected to be present at the Annual
Meeting of Stockholders and will be given an opportunity to make a statement if
they so desire and will be available to respond to appropriate questions from
stockholders. Upon the Audit Committee's recommendation, the Board of Directors
reaffirmed continuation of KPMG LLP as auditors.

The following list details the aggregate fees billed by KPMG LLP for
professional services:

Audit Fees .......................... $84,500
All Other Fees ...................... $351,500(1)

------------
(1) This number includes $54,500 billed for Tax Fees and $297,000 Billed for
other Consulting Fees. There were no fees billed or paid for financial
information systems design and/or implementation.

The Audit Committee of the Board of Directors has determined that the
provision of the non-audit professional services is compatible with maintaining
KPMG LLP's independence.

SHAREHOLDERS' PROPOSALS

Shareholders' proposals intended to be presented at the next annual meeting
should be sent by certified mail, return receipt requested, and must be received
by the Company at its principal executive offices (Attention: Corporate
Secretary) by July 14, 2003 for inclusion in the proxy statement and the form of
proxy for that meeting. Such proposals may be made only by persons who are
shareholders, beneficially or of record, on the date the proposals are submitted
and who continue in such capacity through the 2003 annual meeting date, of at
least 1% or $1,000 in market value of securities entitled to be voted at the
meeting, and have held such securities for at least one year.

For any stockholder proposal that is not submitted for inclusion in the
2003 Proxy Statement, but is instead sought to be presented directly at the 2003
Annual Meeting, management will be able to vote proxies in its discretion if the
Company: (i) does not receive notice of the proposal prior to the close of
business on July 25, 2003; or (ii) receives notice of the proposal before the
close of business on July 25, 2003 and advises stockholders in the 2003 Proxy
Statement about the nature of the matter and how management intends to vote on
such matter.

OTHER BUSINESS

The Board of Directors is aware of no other matter that will be presented
for action at the meeting. If any other matter requiring a vote of the
shareholders properly comes before the meeting, the persons authorized under
management proxies will vote and act according to their best judgment.

By Order of the Board of Directors

Denise Plair
Secretary

--------------------------------------------------------------------------------
FORM 10-K

A copy of the 2002 Annual Report on Form 10-K for the fiscal year ended August
31, 2002, as filed with the Securities and Exchange Commission, May be obtained
upon request and without charge, by writing:

Alico, Inc.
Post Office Box 338
LaBelle, Florida 33975
--------------------------------------------------------------------------------

ALICO, INC.
P.O. BOX 338
LABELLE, FL 33975

VOTE BY MAIL
Mark, sign, and date your proxy card and return it in the postage-paid envelope
we have provided or return it to Alico, Inc., c/o ADP, 51 Mercedes Way,
Edgewood, NY 11717.

TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
ALICO1 KEEP THIS PORTION FOR YOUR RECORDS
--------------------------------------------------------------------------------
DETACH AND RETURN THIS PORTION ONLY

THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
________________________________________________________________________________

ALICO, INC.

1. ELECTION OF DIRECTORS:
Nominees:
01) Ben Hill Griffin, III 06) Amy Gravina
02) Richard C. Ackert 07) Ben Hill Griffin, IV
03) William L. Barton 08) K. E. Hartsaw
04) Walker E. Blount, Jr. 09) W. Bernard Lester
05) Monterey Campbell 10) Thomas E. Oakley

For Withhold For All To withhold authority to vote, mark "For All Except"
All All Except and write the nominee's number on the line below.

[ ] [ ] [ ] ___________________________________________________

2. In their discretion, the proxy or proxies are authorized to vote upon such
other business as may properly come before the meeting or any and all
adjournments thereof.

THIS PROXY CARD, 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 PROPOSAL 1.

PLEASE MARK, DATE, SIGN AND MAIL YOUR PROXY CARD PROMPTLY IN THE ENCLOSED
ENVELOPE. YOUR PROMPT ATTENTION WILL BE APPRECIATED. NO POSTAGE IS NEEDED IF
MAILED WITHIN THE UNITED STATES.

(Executors, Administrators, Trustees, Guardians, etc. will so indicate
when signing.)

----------------------------------------- --------------------------------
Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date

________________________________________________________________________________

PROXY

ALICO, INC.
P.O. Box 338
La Belle, Florida 33975

THIS PROXY IS SOLICITED ON BEHALF OF THE COMPANY'S BOARD OF DIRECTORS

The undersigned stockholder(s) of Alico, Inc., a Florida corporation (the
"Company"), hereby appoints BEN HILL GRIFFIN, III and W. BERNARD LESTER, or
either of them, the proxy or proxies of the undersigned, each with the power to
appoint his substitute, and hereby authorizes them to represent and to vote, as
designated on the reverse side, all the shares of Common Stock of the Company,
held of record by the undersigned on October 11, 2002, at the Annual Meeting of
Stockholders of the Company, to be held on Thursday, December 5, 2002, and at
any and all adjournments thereof, with all powers the undersigned would possess
if personally present.

(Continued and to be signed on the other side)

________________________________________________________________________________