<PAGE> 1
Schedule 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, For Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
ODWALLA, INC.
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on the table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials:
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[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount previously paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
<PAGE> 2
[ODWALLA LOGO]
Dear Shareholder:
You are cordially invited to attend the annual meeting of shareholders of
Odwalla, Inc., which will be held on February 6, 2001, at 1:30 p.m. local time,
at Mel Mello Center for the Arts, 1167 Main Street, Half Moon Bay, California.
At the annual meeting you will consider and vote upon the following
proposals: (i) to elect seven (7) directors of the Company and (ii) to ratify
the appointment of PricewaterhouseCoopers LLP as independent accountants of the
Company for the fiscal year ending September 1, 2001.
The enclosed Proxy Statement more fully describes the details of the
business to be conducted at the Annual Meeting. AFTER CAREFUL CONSIDERATION, THE
COMPANY'S BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED THE PROPOSALS AND
RECOMMENDS THAT YOU VOTE FOR EACH SUCH PROPOSAL.
After reading the Proxy Statement, please mark, date, sign and return the
enclosed proxy card in the accompanying reply envelope by no later than February
2, 2001. If you decide to attend the Annual Meeting and would prefer to vote in
person, please notify the Secretary of the Company that you wish to vote in
person and your proxy will not be voted. YOUR SHARES CANNOT BE VOTED UNLESS YOU
SIGN, DATE AND RETURN THE ENCLOSED PROXY OR ATTEND THE ANNUAL MEETING IN PERSON.
A copy of Odwalla's 2000 Annual Report has been mailed concurrently
herewith to all shareholders entitled to notice of and to vote at the annual
meeting.
Sincerely yours,
/s/ D. STEPHEN C. WILLIAMSON
--------------------------------------
D. STEPHEN C. WILLIAMSON
Chairman of the Board
Chief Executive Officer
Half Moon Bay, California
December 26, 2000
<PAGE> 3
ODWALLA, INC.
120 STONE PINE ROAD
HALF MOON BAY, CALIFORNIA 94019
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD FEBRUARY 6, 2001
The annual meeting of shareholders of Odwalla, Inc., a California
corporation, will be held on Tuesday, February 6, 2001, at 1:30 p.m. local time,
at Mel Mello Center for the Arts, 1167 Main Street, Half Moon Bay, California
to:
1. Elect seven (7) directors of Odwalla to serve until the 2001 annual
meeting of shareholders or until their successors are elected and
qualified;
2. Ratify the appointment of PricewaterhouseCoopers LLP as independent
accountants of Odwalla for the fiscal year ending September 1, 2001; and
3. Transact any other business as may properly come before the meeting
or any adjournments or postponements thereof.
Each of the foregoing items of business are more fully described in the
proxy statement that accompanies this Notice.
Only shareholders of record at the close of business on December 19, 2000
are entitled to notice of and to vote at the annual meeting and at any
continuation or adjournment thereof.
All shareholders are cordially invited and encouraged to attend the annual
meeting. In any event, to assure your representation at the annual meeting,
please carefully read the accompanying proxy statement which describes the
matters to be voted on at the annual meeting and sign, date and return the
enclosed proxy card in the reply envelope provided. Should you receive more than
one proxy because your shares are registered in different names and addresses,
each proxy should be returned to assure that all your shares will be voted. If
you attend the annual meeting and vote by ballot, your proxy will be revoked
automatically and only your vote at the annual meeting will be counted. The
prompt return of your proxy card will assist us in preparing for the annual
meeting.
BY ORDER OF THE BOARD OF DIRECTORS,
JAMES R. STEICHEN
Secretary
Half Moon Bay, California
December 26, 2000
<PAGE> 4
PROXY STATEMENT
FOR THE ANNUAL MEETING OF SHAREHOLDERS OF
ODWALLA, INC.
TO BE HELD FEBRUARY 6, 2001
INFORMATION CONCERNING THE ANNUAL MEETING
DATE, TIME AND PLACE OF THE ANNUAL MEETING
This proxy statement is furnished in connection with the solicitation by
the Board of Directors of Odwalla, Inc., a California corporation, of proxies to
be voted at the annual meeting of shareholders to be held on February 6, 2001,
or at any adjournment or postponement thereof, for the purposes set forth in the
accompanying Notice of Annual Meeting of Shareholders. Shareholders of record on
December 19, 2000, will be entitled to vote at the annual meeting. The annual
meeting will be held at Mel Mello Center for the Arts, 1167 Main Street, Half
Moon Bay, California.
It is anticipated that this proxy statement and the enclosed proxy card
will be first mailed to shareholders on or about January 2, 2001.
PURPOSES OF THE ANNUAL MEETING
At the Odwalla annual meeting, holders of Odwalla common stock will
consider and vote upon proposals to:
1. Elect seven (7) directors of Odwalla to serve until the 2001 annual
meeting of shareholders or until their successors are elected and
qualified;
2. Ratify the appointment of PricewaterhouseCoopers LLP as independent
accountants of Odwalla for the fiscal year ending September 1, 2001.
VOTING RIGHTS OF SHAREHOLDERS
The close of business on December 19, 2000, has been fixed as the record
date for determining the holders of shares of Odwalla common stock entitled to
notice of and to vote at the annual meeting and at any adjournments thereof. As
of the close of business on the record date, Odwalla had 11,037,780 shares of
its common stock outstanding and entitled to vote at the annual meeting, held by
304 shareholders of record. The presence at the annual meeting of a majority of
these shares of common stock, either in person or by proxy, will constitute a
quorum for the transaction of business at the annual meeting. An automated
system administered by Odwalla's transfer agent tabulates shareholder votes.
Each outstanding share of Odwalla common stock on the record date is entitled to
one vote on all matters. Directors shall be elected by a plurality of the votes
cast.
If any shareholder is unable to attend the annual meeting, the shareholder
may vote by proxy. The enclosed proxy is solicited by Odwalla's Board of
Directors, and, when the proxy card is returned properly completed, it will be
voted as directed by the shareholder on the proxy card. Shareholders are urged
to specify their choices on the enclosed proxy card. If a proxy card is signed
and returned without choices specified, in the absence of contrary instructions,
the shares of common stock represented by the proxy will be voted FOR Proposals
1 and 2 and will be voted in the proxy holders' discretion as to other matters
that may properly come before the annual meeting.
Each of the proposals requires the affirmative vote of the holders of a
majority of the shares of Odwalla common stock voting together as a class
present, or represented, and voting at the Odwalla annual meeting. For purposes
of determining whether the proposals have been approved, the inspector of
election will exclude abstentions and broker non-votes from the number of shares
deemed to be present, or represented, and entitled to vote on the matters at the
Odwalla annual meeting. Accordingly, abstentions and broker non-votes will have
no effect, on the voting of the proposals.
<PAGE> 5
As of the record date, directors and executive officers of Odwalla and
their affiliates were beneficial owners of an aggregate of 6,490,722 shares of
Odwalla common stock or approximately 58.8% of the 11,037,780 shares of Odwalla
common stock that were issued and outstanding as of that date. See "Security
Ownership of Certain Beneficial Owners and Management of Odwalla" on page 12 of
this proxy statement.
REVOCABILITY OF PROXIES
Any person giving a proxy has the power to revoke it at any time before its
exercise. A proxy may be revoked by (1) filing with the Secretary of Odwalla an
instrument of revocation or a duly executed proxy bearing a later date, or (2)
attending the annual meeting and voting in person.
SOLICITATION OF PROXIES
Odwalla will bear the cost of soliciting proxies. Copies of solicitation
material will be furnished to brokerage houses, fiduciaries, and custodians
holding shares in their names that are beneficially owned by others to forward
to the beneficial owners. Odwalla may reimburse these persons for their costs of
forwarding the solicitation material to these beneficial owners. The original
solicitation of proxies by mail may be supplemented by solicitation by
telephone, telegram, or other means by directors, officers, employees or agents
of Odwalla. No additional compensation will be paid to these individuals for any
of these services. Except as described above, Odwalla does not intend to solicit
proxies other than by mail.
ODWALLA'S ANNUAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 2, 2000, HAS
BEEN MAILED CONCURRENTLY WITH THE MAILING OF THE NOTICE OF ANNUAL MEETING AND
PROXY STATEMENT TO ALL SHAREHOLDERS ENTITLED TO NOTICE OF AND TO VOTE AT THE
ANNUAL MEETING. THE ANNUAL REPORT IS NOT INCORPORATED INTO THIS PROXY STATEMENT
AND IS NOT CONSIDERED PROXY SOLICITING MATERIAL.
PROPOSALS AT THE ANNUAL MEETING
PROPOSAL NO. 1:
ELECTION OF DIRECTORS
At the annual meeting of Odwalla shareholders, seven directors, which
constitute the entire Odwalla Board, are to be elected to serve until the next
annual meeting of shareholders and until a successor for the director is elected
and qualified, or until the death, resignation, or removal of the director. It
is intended that the proxies will be voted for the seven nominees named below
for election to Odwalla's Board of Directors unless authority to vote for any
the nominee is withheld. There are seven nominees, all of whom are currently
directors of Odwalla. Each person nominated for election has agreed to serve if
elected, and the Board of Directors has no reason to believe that any nominee
will be unavailable or will decline to serve. In the event, however, that any
nominee is unable or declines to serve as a director at the time of the annual
meeting, the proxies will be voted for any nominee who is designated by the
current Board of Directors to fill the vacancy. Unless otherwise instructed, the
proxyholders will vote the proxies received by them for the nominees named
below. The seven candidates receiving the highest number of the affirmative
votes of the shares entitled to vote at the annual meeting will be elected
directors of Odwalla. The proxies solicited by this proxy statement may not be
voted for more than seven nominees.
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<PAGE> 6
NOMINEES
Set forth below is information regarding the nominees to the Board of
Directors.
<TABLE>
<CAPTION>
FIRST ELECTED
NAME POSITION WITH ODWALLA AGE DIRECTOR
---- --------------------- --- -------------
<S> <C> <C> <C>
D. Stephen C. Williamson.................. Chairman of the Board 42 1992
and Chief Executive Officer
Andrew B. Balson(2)....................... Director 34 2000
Richard L. Grubman(1)(2).................. Director 38 1997
Ellis B. Jones(1)......................... Director 46 2000
Mark E. Nunnelly.......................... Director 42 2000
Juan I. Prado............................. Director 40 2000
Craig H. Sakin(1)(2)...................... Director 40 1999
</TABLE>
---------------
(1) Member of the Audit Committee
(2) Member of the Compensation Committee
D. STEPHEN C. WILLIAMSON currently serves as Chairman of the Board and as
Chief Executive Officer, a position he has held since June 1996. Prior to that
time, Mr. Williamson served as Co-Chairman of the Board and Co-Chief Executive
Officer from January 1995 to June 1996 and as Chief Financial Officer of the
Company from March 1991 to August 1996. Mr. Williamson also served as the
Company's President from May 1992 until January 1995. Mr. Williamson holds a
B.A. degree in history from the University of California at Berkeley. He is also
Chairman of Avenal Land & Oil Company, a private investment company.
ANDREW B. BALSON has served as a director of the Company since May 2000.
Mr. Balson has been a Managing Director of Bain Capital since December 2000.
Previously, Mr. Balson was a Principal of Bain Capital since June 1998 and had
been an Associate at Bain Capital since November 1996. Prior to this, Mr. Balson
was a consultant with Bain & Company since August 1994. Mr. Balson is also a
director of Domino's Pizza, Inc., Stream International and Interpath, Inc.
RICHARD L. GRUBMAN has served as a director of the Company since August
1997. Mr. Grubman has been a Managing Director of Highfields Capital Management,
LP since April 1998. Prior to this, Mr. Grubman was a Managing Director of
Development Capital, LLC since January 1997 and a general partner of its
affiliate, Corporate Value Partners, LP, since November 1996. Mr. Grubman was
also previously President of Sycamore Capital Management, Inc., a position he
held since January 1996. From December 1992 to November 1995, Mr. Grubman was a
general partner of Lakeview Partners, L.P. During 1992, he was a vice president
of Gollust, Tierney and Oliver, Incorporated. Mr. Grubman holds an A.B. degree
in Art and Archaeology from Princeton University.
ELLIS B. JONES has served as a director of the Company since May 2000. Mr.
Jones currently serves as Managing Director of Wasserstein Perella & Co., Inc.
and President of Wasserstein Perella Asset Management, the firm's merchant
banking and venture capital businesses. Prior to joining Wasserstein Perella in
February 1995, Mr. Jones was Managing Director/Head of Los Angeles Corporate
Finance at Salomon Brothers, Inc. from 1989 through 1994. Mr. Jones graduated
from the Yale School of Management and the University of California at Berkeley.
He currently serves as a director for a number of privately held companies.
MARK E. NUNNELLY has served as a director of the Company since May 2000.
Mr. Nunnelly has been a Managing Director of Bain Capital since 1990. Prior to
that time, Mr. Nunnelly was a partner at Bain & Company and was employed by
Procter & Gamble Company Inc. in product management. Mr. Nunnelly serves on the
board of directors of several companies, including Domino's Pizza, eCredit.com,
Modus Media, Stream International, Inc., Advanced Telecommunications, Inc. and
DoubleClick, Inc.
JUAN I. PRADO has served as a director of the Company since August 2000.
Mr. Prado has served as Chairman and CEO of Promisant Ltd., a provider of
internet financial services since March 1999. Prior to this, Mr. Prado served as
a senior officer of the Coca-Cola Company's Latin American Group since 1991.
3
<PAGE> 7
Mr. Prado received an MBA from The Wharton School, an MA in languages and
international studies from The University of Pennsylvania, and a B.S. in
industrial engineering from Tufts University.
CRAIG H. SAKIN has served as a director of the Company since February 1999.
Mr. Sakin has served as Managing Director of Catterton Partners, a group of
affiliated venture capital funds, since August 1996. From November 1991 to
August 1996, Mr. Sakin was Chairman of Gold Coast Beverage Distributors, a beer
distribution company, and also served as the Chief Executive Officer during this
period. Mr. Sakin holds a B.S. from St. Lawrence University.
VOTE REQUIRED
The approval of the nominees as directors requires the affirmative vote of
the holders of a plurality of the shares of Odwalla common stock and preferred
stock, voting together as a class, present or represented at the Odwalla annual
meeting.
RECOMMENDATION OF THE BOARD
The Board of Directors unanimously recommends that shareholders vote FOR
election of all of the nominees for directors.
BOARD MEETINGS AND COMMITTEES
The Board of Directors held eight (8) meetings during fiscal 2000. During
fiscal 2000, each director, other than Mr. Nunnelly, attended more than
seventy-five percent (75%) of the aggregate of (1) the total number of meetings
of the Board of Directors and (2) the total number of meetings held by all
committees of the Board on which the director served. There are no family
relationships among executive officers or directors of Odwalla. The Board of
Directors has an Audit Committee and a Compensation Committee. Odwalla does not
have a nominating committee.
The Audit Committee of the Board of Directors held one (1) meeting during
fiscal 2000.
The Compensation Committee of the Board of Directors held six (6) meetings
during fiscal 2000. The Compensation Committee, which is currently comprised of
Directors Grubman, Balson and Sakin, has overall responsibility for Odwalla's
compensation policies and determines the compensation payable to Odwalla's
executive officers, including their participation in Odwalla's employee benefit
and stock option plans.
REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
The Audit Committee is composed of Directors Jones, Grubman and Sakin. Each
of the members of the Audit Committee is independent (as defined in NASD's
listing standards). The Board of Directors adopted a written charter for the
Audit Committee in June 2000. The Audit Committee Charter is attached as
Appendix A to this Proxy Statement.
The primary function of the Audit Committee is to assist the Board of
Directors in fulfilling its oversight responsibilities by reviewing the
financial reports and other financial information provided by the Company to any
governmental body or the public, the Company's system of internal controls
regarding finance, accounting, legal compliance and ethics that management and
the Board have established, the audit efforts of the Company's independent
accountants, and the Company's auditing, accounting and financial reporting
processes generally. The Audit Committee annually recommends to the Board of
Directors the appointment of a firm of independent auditors to audit the
financial statements of the Company and meets with such independent auditors,
the CEO and the principal financial and accounting personnel of the Company to
review the scope and the results of the annual audit, the Company's financial
statements contained in the Company's Annual Report to Stockholders and other
related matters.
4
<PAGE> 8
The Audit Committee has reviewed and discussed with management the
financial statements for the fiscal year ended September 2, 2000 audited by
PricewaterhouseCoopers LLP and reviewed with PricewaterhouseCoopers various
matters related to the financial statements, including those matters required to
be discussed by SAS 61 (Codification of Statements on Auditing Standards, AU
380). The Audit Committee has also received the written disclosures and the
letter from PricewaterhouseCoopers LLP required by Independence Standards Board
Standard No. 1 (Independence Standards Board Standard No. 1, Independence
Discussions with Audit Committee), and has discussed with PricewaterhouseCoopers
LLP its independence. Based upon such review and discussions, the Audit
Committee 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 September 2, 2000 for filing with the Securities and Exchange
Commission.
With respect to the above matters, the Audit Committee submits this report.
Ellis B. Jones, Board Member and Audit Committee Chairman
Richard L. Grubman, Board Member and Audit Committee Member
Craig H. Sakin, Board Member and Audit Committee Member
EXECUTIVE OFFICER AND DIRECTOR COMPENSATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following Summary Compensation Table sets forth the compensation earned
by Odwalla's current Chief Executive Officer and the four other most highly
compensated executive officers in fiscal 2000 for services rendered in all
capacities to Odwalla and its subsidiaries for the fiscal years ended August 29,
1998, August 28, 1999 and September 2, 2000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
---------------------------- ------------
SECURITIES
UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEARS SALARY BONUS OPTIONS(1) COMPENSATION(2)
--------------------------- ----- -------- ------- ------------ ---------------
<S> <C> <C> <C> <C> <C>
D. Stephen C. Williamson.......... 2000 $242,308 $30,000 110,000 $ --
Chairman of the Board and 1999 $185,000 $ -- 160,000 $ --
Chief Executive Officer 1998 $159,375 $ -- -- $ --
James R. Steichen................. 2000 $193,750 $20,000 40,000 $ 772
Senior Vice President, Finance 1999 $169,577 $ -- 70,000 $1,081
and Chief Financial Officer 1998 $160,154 $ -- 25,000 $1,131
Theodore R. Leaman III............ 2000 $163,077 $15,000 -- $ 554
Vice President, 1999 $ 64,615 $ -- 50,000 $ --
Manufacturing 1998 $ -- $ -- -- $ --
Karen Lucas....................... 2000 $154,614 $15,070 20,000 $ 717
Vice President, Marketing 1999 $ 3,217 $ -- -- $ --
and East Coast Sales 1998 $ -- $ -- -- $ --
Susan M. Kirmayer................. 2000 $124,692 $15,000 -- $ 681
Vice President, 1999 $103,994 $ -- 20,000 $ 868
Human Resources 1998 $ 90,462 $ -- 9,000 $ 727
</TABLE>
---------------
(1) The options listed in the table were granted under Odwalla's 1997 Stock
Option/Stock Issuance Plan.
(2) Represents Odwalla's matching 401(k) plan contribution.
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<PAGE> 9
STOCK OPTIONS
The following table contains information concerning the stock options
granted in fiscal 2000 to Odwalla's Chief Executive Officer and each of the four
(4) other most highly compensated executive officers of Odwalla for fiscal 2000.
No stock appreciation rights were granted to those individuals during the year.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
INDIVIDUAL GRANT VALUE AT ASSUMED
-------------------------------------------- ANNUAL RATES OF
NUMBER OF PERCENT OF TOTAL STOCK PRICE
SECURITIES OPTIONS APPRECIATION
UNDERLYING GRANTED EXERCISE FOR OPTION TERM(2)
OPTIONS TO EMPLOYEES IN PRICE EXPIRATION ---------------------
NAME GRANTED FISCAL YEAR ($/SHARE)(1) DATE 5% 10%
---- ---------- ---------------- ------------ ---------- -------- ----------
<S> <C> <C> <C> <C> <C> <C>
D. Stephen C. Williamson... 110,000(3) 26.44% $ 6.75 5/11/10 $466,954 $1,183,354
James R. Steichen.......... 40,000(3) 9.61% $ 6.75 5/11/10 $169,802 $ 430,310
Karen Lucas................ 20,000(4) 4.81% $7.125 9/22/09 $ 89,617 $ 227,108
</TABLE>
---------------
(1) The exercise price may be paid in cash, in shares of common stock valued at
fair market value on the exercise date or through a cashless exercise
procedure involving a same-day sale of the purchased shares. Odwalla may
also finance the option exercise by loaning the optionee sufficient funds to
pay the exercise price for the purchased shares and the Federal and state
income and employment tax liability incurred by the optionee in connection
with the exercise.
(2) There is no assurance provided to the option holder or any other holder of
Odwalla's securities that the actual stock price appreciation over the five-
or 10-year option term will be at the 5% and 10% assumed annual rates of
compounded stock price appreciation.
(3) The options were granted under the Odwalla 1997 Stock Option/Stock Issuance
Plan on May 11, 2000, with a vesting commencement date of the same date. The
options granted have a maximum term of 10 years, all measured from the grant
date, subject to earlier termination upon the optionee's cessation of
service with Odwalla. All options will vest as to 1/36 of the shares each
month.
(4) The options were granted under the Odwalla 1997 Stock Option/Stock Issuance
Plan on September 22, 1999, with a vesting commencement date of the same
date. The options granted have a maximum term of 10 years, all measured from
the grant date, subject to earlier termination upon the optionee's cessation
of service with Odwalla. All options will vest as to 1/36 of the shares each
month.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES
The following table sets forth information concerning option holdings for
the 2000 fiscal year by Odwalla's Chief Executive Officer and each of the four
other most highly compensated executive officers of Odwalla for fiscal 2000.
There were no option exercises during fiscal 2000. No stock appreciation rights
were exercised during the year or were outstanding at the end of the year.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS AT
OPTIONS AT FY-END FY-END(1)
--------------------------- ---------------------------
NAME EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
D. Stephen C. Williamson......................... 232,554 212,446 $32,292 $25,209
James R. Steichen................................ 77,044 83,056 $ 8,650 $15,420
Theodore R. Leaman III........................... 21,112 28,888 $20,828 $26,032
Karen Lucas...................................... 6,667 13,333 $ -- $ --
Susan M. Kirmayer................................ 16.278 12.722 $ -- $ --
</TABLE>
---------------
(1) Based on the fair market value of the shares at the end of the 2000 fiscal
year ($7.00 per share) less the option exercise price payable for those
shares.
6
<PAGE> 10
EMPLOYMENT CONTRACTS, TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL AGREEMENTS
On December 14, 2000, Douglas Levin resigned as president and entered into
a Separation Agreement and Release with Odwalla. Under the terms of that
agreement, Mr. Levin will receive payments of approximately $215,000 per year
through December 31, 2003. In addition, Mr. Levin will receive health benefits
similar to those received by Odwalla employees for the same time period and a
housing allowance of approximately $72,000 through June 2001. Mr. Levin also
entered into a consulting agreement with Odwalla on December 14, 2000, under
which he will receive $60,000 annually through December 31, 2003. On December
14, 2000, Mr. Levin also forfeited his rights to all stock options, vested or
unvested, that he held at that time.
On December 21, 1999, D. Stephen C. Williamson, Odwalla's Chief Executive
Officer, and James R. Steichen, Odwalla's Senior Vice President, Finance and
Chief Financial Officer, entered into employment agreements with Odwalla that
are effective until December 21, 2002. Thereafter, these agreements are subject
to three (3) consecutive automatic one-year renewals. The agreements generally
provide for annual salaries to be paid at the most recently approved salary
approved by the Compensation Committee of the Board of Directors and the right
to participate in and to receive those employee benefits that are generally
provided to similarly situated employees at Odwalla. If Mr. Williamson's or Mr.
Steichen's employment is terminated due to death, a disability that prevents him
from performing his duties for six months, termination for cause, or resignation
without good reason, payment of his salary and benefits will cease.
If Mr. Williamson or Mr. Steichen is terminated other than for cause or is
terminated in connection with a change of control or corporate transaction (as
those terms are defined in Odwalla's 1997 Stock Option/ Issuance Plan), the
terminated employee is entitled to receive specified payments that are
substantially equivalent to the remaining payments he would have received had he
remained employed through the term of his agreement. The terminated employee
also would be entitled to reimbursement for the cost of acquiring health
benefits through the term of his agreement. All stock options held by the
terminated employee would automatically become vested and fully exercisable at
the time his termination becomes effective. The total payments or benefits
received by Mr. Williamson or Mr. Steichen from Odwalla resulting from
termination in connection with a change of control or corporate transaction
shall not exceed three times the terminated employee's annualized compensation
minus $1.00. If Mr. Williamson or Mr. Steichen resigns for good reason, the
resigning employee is entitled to received severance pay equal to his base
salary for a period of twelve months. The resigning employee also would be
entitled to reimbursement for the cost of acquiring health benefits for a period
of twelve months.
DIRECTOR COMPENSATION
Odwalla's non-employee directors currently receive $10,000 per year, in
addition to reimbursement for some expenses incurred in connection with
attendance at Board and committee meetings.
Under the Automatic Option Grant Program of the Odwalla 1997 Stock
Option/Stock Issuance Plan, each individual who first becomes a non-employee
Board member, whether through election by the shareholders or appointment by the
Board, is automatically granted, at the time of the initial election or
appointment, a non-statutory option to purchase 5,000 shares of common stock,
provided the individual was not previously in Odwalla's employment. In addition,
on the date of each annual meeting, each individual who is to continue to serve
as a non-employee Board member, whether or not that individual is standing for
re-election to the Board at that particular annual meeting, will automatically
be granted at that meeting a non-statutory option to purchase 3,000 shares of
common stock, provided the individual has served as a non-employee Board member
for at least six months. There is no limit on the number of these 3,000-share
option grants any one non-employee Board member may receive over his or her
period of Board service, and non-employee Board members who have previously
served in Odwalla's employ will be fully eligible for one or more 3,000-share
option grants.
7
<PAGE> 11
Each option granted under the Automatic Option Grant Program is subject to
the following terms and conditions:
1. The exercise price per share will be equal to 100% of the fair
market value per share of common stock on the automatic grant date.
2. Each option will have a maximum term equal to the lesser of (a) ten
years measured from the grant date or (b) twelve months following
termination of Board service.
3. Each option will be immediately exercisable for all the option
shares, but any purchased shares will be subject to repurchase by Odwalla,
at the exercise price paid per share, upon the optionee's cessation of
Board service prior to vesting in those shares.
4. The shares subject to each initial 5,000 share grant will vest in
four successive equal annual installments over the optionee's period of
Board service, with the first installment to vest upon the completion of
one year of Board service, measured from the automatic grant date. All of
the shares subject to each annual 3,000 share grant will vest upon the
optionee's completion of one year of Board service, measured from the
automatic grant date.
5. The shares subject to each outstanding automatic option grant will
immediately vest should the optionee die or become permanently disabled
while a Board member or should any of the following events occur while the
optionee continues in Board service: (a) an acquisition of Odwalla by
merger or asset sale; (b) the successful completion of a hostile tender
offer for more than 50% of the total combined voting power of Odwalla's
outstanding securities; or (c) a change in the majority of the Board
occasioned by one or more contested elections for Board membership.
6. Upon the successful completion of a hostile tender offer for
securities possessing more than fifty percent (50%) of the total combined
voting power of Odwalla's outstanding securities, each outstanding
automatic option grant may be surrendered to Odwalla for a cash
distribution per surrendered option share in an amount equal to the excess
of (a) the greater of (1) the fair market value per share of common stock
on the date the option is surrendered to Odwalla in connection with a
hostile tender offer or (2) the highest price per share of common stock
paid in the hostile tender offer over (b) the exercise price payable per
share.
Under the Automatic Option Grant Program described above, the following
options were granted to non-employee directors under the Odwalla 1997 Stock
Option/Stock Issuance Plan in fiscal 2000: Mr. Grubman and Mr. Sakin were each
granted 3,000 shares of Odwalla common stock at an exercise price of $6.375 per
share; Mr. Balson and Mr. Nunnelly were each granted 5,000 shares of Odwalla
common stock at an exercise price of $6.375 per share; Mr. Jones was granted
5,000 shares of Odwalla common stock at an exercise price of $6.875 per share;
Mr. Prado was granted 5,000 shares of Odwalla common stock at an exercise price
of $7.00 per share.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee of the Board of Directors was formed on October
26, 1993, and is currently comprised of Mr. Grubman, Mr. Balson and Mr. Sakin.
None of these individuals were at any time during fiscal 2000, or at any other
time, an officer or employee of Odwalla. No executive officer of Odwalla serves
as a member of the board of directors or compensation committee of any other
entity that has one or more executive officers serving as a member of Odwalla's
Board of Directors or Compensation Committee.
REPORT OF THE COMPENSATION COMMITTEE ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors, subject to review by
the full Board, is responsible for the establishment of remuneration
arrangements for senior management and the administration of compensation and
employee benefit plans. In addition, the Compensation Committee sets the base
salary of Odwalla's executive officers, approves individual bonus programs for
executive officers, and administers Odwalla's stock option plans under which
grants may be made to executive officers and other key
8
<PAGE> 12
employees. The following is a summary of policies of the Compensation Committee
that affect the compensation paid to executive officers, as reflected in the
tables and text set forth elsewhere in this document.
General Compensation Policy. The objectives of Odwalla's executive
compensation program are to motivate and retain current executives and to
attract future ones. Odwalla's executive compensation program is designed to:
(1) provide a direct and substantial link between Odwalla's performance and
executive pay, (2) consider individual performance and accomplishments and
compensate accordingly, and (3) determine Odwalla's position in the specialty
beverage and food labor markets and be competitive in those labor markets.
Odwalla's intent is to position its executive pay levels at the median of U.S.
specialty beverage and food companies. The Committee also considers geographic
location and companies that may compete with Odwalla in recruiting executive
talent.
Factors. The principal factors which the Compensation Committee considered
in establishing the components of each executive officer's compensation package
for fiscal 2000 are summarized below. The Compensation Committee may, however,
in its discretion apply entirely different factors in setting executive
compensation for future years.
Base Salary. The base salary for each officer is set on the basis of
personal performance, the Compensation Committee's assessment of salary levels
in effect for comparable positions with Odwalla's principal competitors, and
internal comparability considerations. The weight given to each of these factors
may vary from individual to individual, and the Compensation Committee did not
rely upon any specific compensation surveys for comparative compensation
purposes. Instead, the Compensation Committee made its decisions as to the
appropriate market level of base salary for each executive officer on the basis
of its understanding of the salary levels in effect at companies with which
Odwalla competes for executive talent. Base salaries will be reviewed on an
annual basis, and adjustments will be made in accordance with the factors
indicated above.
Long-Term Incentive Compensation. Long-term incentives are provided through
stock option grants. The grants are designed to align the interests of the
executive officers with those of the shareholders, and to provide each officer
with a significant incentive to manage Odwalla from the perspective of an owner
with an equity stake in the business. The stock option plan encourages long term
retention and provides rewards to executives and other eligible employees
commensurate with growth in shareholder value. It is the Committee's practice to
grant options to purchase shares at the market price on the date of grant with a
term of up to ten years. The options granted to Odwalla's executive officers
during fiscal 2000 will vest from the date of grant in thirty-six or forty-eight
equal monthly installments. Accordingly, the options will provide a return to
the executive officer only if he or she remains in Odwalla's employ and the
market price of the underlying shares of common stock appreciates.
The number of shares subject to each option grant is set at a level
intended to create a meaningful opportunity for stock ownership based on the
officer's current position with Odwalla, the base salary associated with that
position, the size of comparable awards made to individuals in similar positions
within the industry, the individual's potential for increased responsibility and
promotion over the option term, and the individual's personal performance in
recent periods. The Committee also takes into account the number of unvested
options held by the executive offer in order to maintain an appropriate level of
equity incentive for that individual. However, the Committee does not adhere to
any specific guidelines as to the relative option holdings of Odwalla's
executive officers.
CEO Compensation. The compensation payable to Mr. Williamson, Odwalla's
Chief Executive Officer, was determined by the Compensation Committee. Mr.
Williamson's base salary was set at a level which the Board believed would be
competitive with the base salary levels in effect for chief executive officers
at similarly-sized companies within the industry. For the 2000 fiscal year, Mr.
Williamson's compensation package was set by the Compensation Committee on the
basis of the compensation policy summarized in this report.
9
<PAGE> 13
Compliance with Internal Revenue Code Section 162(m). Section 162(m) of the
Internal Revenue Code, enacted in 1993, generally disallows a tax deduction to
publicly-held companies for compensation paid to executive officers, to the
extent that compensation exceeds $1.0 million per officer in any year. The
compensation paid to Odwalla's executive officers for fiscal 2000 did not exceed
the $1.0 million limit per officer, and it is not expected the compensation to
Odwalla's executive officers for fiscal 2001 will exceed that limit. In
addition, the Odwalla 1997 Stock Option/Stock Issuance Plan is structured so
that any compensation deemed paid to an executive officer in connection with the
exercise of his or her outstanding options under the 1997 Stock Option/Stock
Issuance Plan will qualify as performance-based compensation which will not be
subject to the $1.0 million limitation.
Submitted by the Compensation
Committee of Odwalla's Board of
Directors:
Richard L. Grubman, Board Member and
Compensation Committee Chairman
Andrew B. Balson, Board Member and
Compensation Committee Member
Craig H. Sakin, Board Member and
Compensation Committee Member
10
<PAGE> 14
PERFORMANCE GRAPH
The following graph compares the cumulative total shareholder return on
Odwalla common stock with that of the Standard & Poor's 500 Index and the
Standard & Poor's Foods Index. The comparison for each of the periods assumes
that $100 was invested on August 31, 1994 in Odwalla common stock including
reinvestment of dividends. These indices, which reflect formulas for dividend
reinvestment and weighing of individual stocks, do not necessarily reflect
returns that could be achieved by individual investors.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
AMONG ODWALLA, INC., THE NASDAQ STOCK MARKET (U.S.) INDEX
AND THE RUSSELL 2000 INDEX
[PERFORMANCE GRAPH]
<TABLE>
<CAPTION>
NASDAQ STOCK
ODWALLA, INC. MARKET (U.S.) RUSSELL 2000
------------- ------------- ------------
<S> <C> <C> <C>
8/95 100 100 100
8/96 90.97 112.79 110.82
8/97 62.5 157.36 142.91
8/98 50 148.7 115.19
8/99 39.93 276.25 147.86
8/00 38.89 421.8 169.47
</TABLE>
Notwithstanding anything to the contrary set forth in any of Odwalla's
previous filings under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, that might incorporate future filings,
including this proxy statement, in whole or in part, the preceding Compensation
Committee Report on Executive Compensation and the preceding Performance Graph
shall not be incorporated by reference into any of these filings; nor shall the
Report or graph be incorporated by reference into any future filings.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
Odwalla's directors and executive officers, and persons who own more than ten
percent of a registered class of Odwalla's equity securities, to file with the
SEC initial reports of ownership and reports of changes in ownership of common
stock and other equity securities of Odwalla. Officers, directors and greater
than ten percent shareholders are required by SEC regulations to furnish Odwalla
with copies of all Section 16(a) forms they file.
To Odwalla's knowledge, based solely on a review of the copies of the
reports furnished to Odwalla and written representations that no other reports
were required during the fiscal year ended September 2, 2000, all Section 16(a)
filing requirements applicable to its officers, directors and greater than ten
percent beneficial owners for fiscal 2000 were complied with on a timely basis
with the exception of the following late filings: (a) Mr. Levin inadvertently
failed to file a Form 3 in a timely manner upon becoming an executive officer of
11
<PAGE> 15
Odwalla; (b) Mr. Stankiewicz inadvertently failed to file a Form 3 in a timely
manner upon becoming an executive officer of Odwalla.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT OF ODWALLA
The following table sets forth information regarding the ownership of
Odwalla common stock as of December 19, 2000, by (1) each director, (2) the
Chief Executive Officer and each of the four other most highly compensated
executive officers of Odwalla, determined for Odwalla's fiscal year ended
September 2, 2000, (3) all those known by Odwalla to be beneficial owners of
more than five percent of its common stock, and (4) all directors and executive
officers as a group.
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP(1)
------------------------
NUMBER OF PERCENT OF
BENEFICIAL OWNER SHARES TOTAL(2)
---------------- ---------- -----------
<S> <C> <C>
Samantha Investors, LLC(3).................................. 3,612,122 32.73%
c/o Bain Capital, Inc.
Two Copley Square, 7th Floor
Boston, MA 02116
Catterton-Simon Partners III, L.P. ......................... 1,493,461 13.53%
7 Greenwich Office Park
Greenwich, CT 06830
D. Stephen C. Williamson(4)................................. 898,327 7.94%
c/o Odwalla, Inc.
120 Stone Pine Road
Half Moon Bay, CA 94019
U.S. Equity Partners, LP and U.S. Equity Partners
(Offshore), LP(5)......................................... 764,612 6.93%
1999 Avenue of the Stars, Suite 2950
Los Angeles, CA 90067
Richard Grubman(6).......................................... 45,298 *
Craig H. Sakin(7)........................................... 2,500 *
James R. Steichen(8)........................................ 96,627 *
Theodore R. Leaman III(9)................................... 30,971 *
Karen Lucas(10)............................................. 11,943 *
Susan M. Kirmayer(11)....................................... 21,938 *
Directors and executive officers as
a group (13 persons)(12).................................. 1,122,552 10.17%
</TABLE>
---------------
* Less than one percent
(1) This table is based upon information supplied by officers, directors and
principal shareholders and Schedules 13D and 13G filed with the SEC. Unless
otherwise indicated in the footnotes to this table and subject to community
property laws applicable, Odwalla believes that each of the shareholders
named in this table has sole voting and investment power with respect to
the shares indicated as beneficially owned.
(2) Beneficial ownership is determined in accordance with the rules of the SEC
and generally includes voting or investment power with respect to
securities. Shares of Odwalla common stock, subject to options currently
exercisable or exercisable within 60 days of December 15, 2000, are deemed
outstanding for computing the percentage of the person holding the options,
but aren't deemed outstanding for computing the percentage of any other
person. Percentage of ownership is based on 11,037,780 shares of common
stock outstanding on December 15, 2000.
(3) The members of Samantha LLC are: Bain Capital Fund VI, L.P.; BCIP
Associates II; BCIP Associates II-B; BCIP Associates II-C; BCIP Trust
Associates II; BCIP Trust Associates II-B; JIP Enterprises, Inc.; PEP
Investments PTY Ltd.; RGIP, LLC; Douglas Levin; Abby Carter; Michael
12
<PAGE> 16
Carter; Martha Carter; Robert Carter; Julie Carter. Mr. Balson, Mr.
Nunnelly and Mr. Levin disclaim beneficial ownership of the shares held by
Samantha Investors, LLC, a Massachusetts limited liability company. Mr.
Balson is a Managing Director of Bain Capital, Inc. Mr. Nunnelly is a
Managing Director of Bain Capital, Inc. Mr. Levin was an executive officer
of Odwalla until December 14, 2000.
(4) Includes 41,250 shares of common stock held by Alexandra Bowes, Mr.
Williamson's wife, and 194,851 shares held by Willy Juice Partners, a
limited partnership of which Mr. Williamson is the general partner. Mr.
Williamson disclaims beneficial ownership of shares held by Willy Juice
Partners, except to the extent of his pecuniary interest therein. Also
includes 280,110 shares of common stock subject to options exercisable
within 60 days of December 15, 2000.
(5) Includes 601,667 shares of common stock held by U.S. Equity Partners, L.P.
and 162,945 shares of common stock held by U.S. Equity Partners (Offshore),
L.P. managed by Wasserstein Perella, of which Mr. Jones disclaims
beneficial ownership. Mr. Jones is Managing Director of Wasserstein Perella
& Co., Inc. and President of Wasserstein Perella Asset Management.
(6) Includes 41,750 shares of common stock subject to options exercisable
within 60 days of December 15, 2000, plus Mr. Grubman's interest in 1,548
shares of common stock held by Willy Juice Partners.
(7) Excludes 1,493,461 shares of common stock held by Catterton-Simon Partners
III, L.P., a Delaware limited partnership. Mr. Sakin disclaims beneficial
ownership of the shares held by Catterton-Simon Partners III, L.P. Mr.
Sakin is a manager of Catterton-Simon Managing Partners III, L.L.C., the
general partner of Catterton-Simon Partners III, L.P. Includes 2,500 shares
of common stock subject to options exercisable within 60 days of December
15, 2000.
(8) Includes 96,627 shares of common stock subject to options exercisable
within 60 days of December 15, 2000.
(9) Includes 30,971 shares of common stock subject to options exercisable
within 60 days of December 15, 2000.
(10) Includes 11,943 shares of common stock subject to options exercisable
within 60 days of December 15, 2000.
(11) Includes 21,638 shares of common stock subject to options exercisable
within 60 days of December 15, 2000.
(12) Includes 457,775 shares of common stock subject to options exercisable
within 60 days of December 15, 2000, and excludes common stock held by
Samantha Investors, LLC, Catterton-Simon Partners III, L.P., U.S. Equity
Partners, LP and U.S. Equity Partners (Offshore), LP of which Mr. Balson,
Mr. Nunnelly, Mr. Sakin and Mr. Jones disclaims beneficial ownership as
discussed in Notes 3, 5, and 7.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS OF ODWALLA
Odwalla has no relationships or related party transactions to report.
PROPOSAL NO. 2:
RATIFICATION OF INDEPENDENT PUBLIC ACCOUNTANTS
PricewaterhouseCoopers LLP served as Odwalla's independent public
accountants for fiscal 2000. Odwalla is asking the shareholders to ratify the
selection of PricewaterhouseCoopers as Odwalla's independent public accountants
for the fiscal year ending September 1, 2001. The affirmative vote of the
holders of a majority of the shares represented and voting at the annual meeting
will be required to ratify the selection of PricewaterhouseCoopers.
In the event the shareholders fail to ratify the appointment, the Audit
Committee of the Board of Directors will consider it as a direction to select
other auditors for the subsequent year. Even if the selection is ratified, the
Board in its discretion may direct the appointment of a different independent
accounting firm at
13
<PAGE> 17
any time during the year if the Board determines that the change would be in the
best interest of Odwalla and its shareholders.
A representative of PricewaterhouseCoopers is expected to be present at the
annual meeting, will have the opportunity to make a statement if he or she
desires to do so, and will be available to respond to appropriate questions.
VOTE REQUIRED
The approval of the ratification of the selection of PricewaterhouseCoopers
as Odwalla's independent public accountants for the fiscal year ended September
1, 2001 requires the affirmative vote of the holders of a majority of the shares
of Odwalla common stock voting together as a class present, or represented, and
voting at the Odwalla annual meeting. Abstentions and broker non-votes will have
no effect on the voting of the proposal.
RECOMMENDATION OF THE BOARD
The Board of Directors unanimously recommends that Odwalla shareholders
vote FOR the proposal to ratify the selection of PricewaterhouseCoopers as
Odwalla's independent public accountants for the fiscal year ending September 1,
2001.
OTHER MATTERS
SHAREHOLDER PROPOSALS
Proposals of shareholders that are intended to be presented at Odwalla's
annual meeting of shareholders for the fiscal 2001 year must be received by
September 1, 2001, to be included in the proxy statement and proxy relating to
that meeting.
OTHER BUSINESS
The Board of Directors knows of no other business that will be presented
for consideration at the annual meeting. If other matters are properly brought
before the annual meeting, however, it is the intention of the persons named in
the accompanying proxy to vote the shares represented thereby on the matters in
accordance with their best judgment.
BY ORDER OF THE BOARD OF DIRECTORS,
JAMES R. STEICHEN
Secretary
December 26, 2000
14
<PAGE> 18
APPENDIX A
ODWALLA, INC.
AUDIT COMMITTEE CHARTER
PURPOSE
The Audit Committee is a committee of the Board of Directors. Its primary
function is to assist the Board in fulfilling its oversight responsibilities by
reviewing:
The financial reports and other financial information provided by the
Company to any governmental body or the public.
The Company's system of internal controls regarding finance,
accounting, legal compliance and ethics that management and the Board have
established.
The audit efforts of the Company's independent accountants, who are
accountable to the Audit Committee and to the entire Board of Directors.
The Company's auditing, accounting and financial reporting processes
generally.
COMMITTEE MEMBERSHIP
The Committee shall consist of at least three Directors appointed annually
by the Board of Directors. The Board of Directors shall also designate a
committee chairman. The Board of Directors shall have the power at any time to
change the membership of the committee and to fill vacancies. Each member of the
Committee shall be an independent director. Members of the Committee shall be
considered independent if they have no relationship to the Company or management
that, in the opinion of the Board of Directors, would interfere with their
exercise of independent judgment as a committee member.
RESPONSIBILITIES AND DUTIES
The Audit Committee shall:
(1) Hold such regular meetings as may be necessary and such special
meetings as may be called by the Chairman of the Committee; provided that the
Committee shall meet at least three times annually.
(2) Review and update this Charter at least annually or more frequently as
conditions dictate.
(3) Recommend to the Board of Directors the independent accountant to be
nominated, approve the compensation of the independent accountant, and review
and approve the discharge of the independent accountant.
(4) Confirm and assure the independence of the independent accountant,
including insuring receipt of an ISB-1 letter from the independent account and a
review of management consulting services and related fees provided by the
independent accountant.
(5) Inquire of management and the independent accountant about significant
risks or exposures and assess the steps management has taken to minimize such
risk to the Company.
(6) Consider, in consultation with the independent accountant, the audit
scope and plan of the independent accountant.
(7) Review on a continuing basis:
(a) The adequacy of the Company's system of internal controls,
including activities, organizational structure and qualifications of the
Company's internal audit function.
(b) The Company's financial accounting and reporting processes.
(c) Any related significant findings and recommendations of the
independent accountant together with management's responses thereto.
<PAGE> 19
(8) Review with management and the independent accountant at the completion
of the annual examination:
(a) The Company's annual financial statements and related footnotes.
(b) The independent accountant's audit of the financial statements and
their report thereon.
(c) Any significant changes required in the independent accountant's
audit plan.
(d) Any significant changes to the Company's auditing and accounting
principles and practices.
(e) Any serious disputes or difficulties with management encountered
during the course of the audit.
(f) Other matters related to the conduct of the audit which are to be
communicated to the Committee under generally accepted auditing standards
and Statement of Accounting Standards No. 61.
(9) Review prior to release documents containing the Company's financial
statements filed with the Securities and Exchange Commission or otherwise
distributed to consider whether the information contained in these documents is
consistent with the information in the financial statements.
(10) Review prior to release the interim financial reports filed with the
Securities and Exchange Commission or otherwise distributed.
(11) Oversee compliance with the requirements of the Securities and
Exchange Commission for disclosure of independent auditor's services and audit
Committee members and activities.
(12) Provide oversight and review of the Company's asset management
policies, including an annual review of the Company's investment policies and
performance for cash and short-term investments.
(13) Review policies and procedures with respect to officers' expense
accounts and perquisites, including their use of corporate assets, and consider
the results of any review of these areas by the independent accountant.
(14) Review of related party transactions for potential conflicts of
interest.
(15) Review legal and regulatory matters that may have a material impact on
the financial statements, related Company compliance policies, and programs and
reports received from regulators.
(16) Provide the opportunity to meet with the independent accountant and
management in separate executive sessions to discuss any matters that the
Committee or the other party believes should be discussed privately with the
Committee.
(17) Review periodically Company policy statements to determine adherence
to the Company's code of conduct or core values, and legal requirements.
(18) Prepare the report required by the rules of the Securities and
Exchange Commission to be included in the Company's annual proxy statement.
(19) Conduct or authorize investigations into any matters within the
Committee's scope of responsibilities. The Committee shall be empowered to
retain independent counsel and other professionals to assist in the conduct of
any investigation.
(20) Prepare minutes of all Committee meetings and activities and submit
such minutes, including any recommendations as the Committee may deem
appropriate, to the Board of Directors.
<PAGE> 20
PROXY
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
ODWALLA, INC.
FOR THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON FEBRUARY 6, 2001
The undersigned shareholder of ODWALLA, INC., a California corporation, hereby
acknowledges receipt of the Notice of Annual Meeting of Shareholders and Proxy
Statement, each dated December 26, 2000 and the Annual Report to Shareholders,
and hereby appoints D. Stephen C. Williamson and James R. Steichen or either of
them, proxies, with full power to each of substitution, on behalf and in the
name of the undersigned, to represent the undersigned at the Annual Meeting of
Shareholders of ODWALLA, INC. to be held on February 6, 2001 at 1:30 p.m., local
time, at the Mel Mello Center for the Arts located at 1167 Main Street, Half
Moon Bay, California, and at any adjournment or adjournments thereof, and to
vote all shares of Common Stock which the undersigned would be entitled to vote
if then and there personally present, on the matters set forth below.
THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO CONTRARY DIRECTION IS INDICATED,
WILL BE VOTED FOR THE ELECTION OF DIRECTORS, FOR THE RATIFICATION OF THE
APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS INDEPENDENT ACCOUNTANTS OF ODWALLA,
AND AS SAID PROXIES DEEM ADVISABLE ON SUCH MATTERS AS MAY PROPERLY COME BEFORE
THE MEETING.
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE.)
FOLD AND DETACH HERE
<PAGE> 21
Please mark
your votes as
indicated in
this example. /X/
<TABLE>
<CAPTION>
FOR WITHHOLD
all nominees AUTHORITY
listed below (except to vote for all
as indicated) nominees listed below
<S> <C> <C>
1. ELECTION OF OFFICERS
If you wish to withhold authority to vote for any / / / /
individual nominee, strike a line through that
nominee's name in the list below.
</TABLE>
<TABLE>
<S> <C> <C>
Nominees: D. Stephen C. Williamson Mark E. Nunnelly
Andrew B. Balson Juan I. Prado
Richard L. Grubman Craig H. Sakin
Ellis B. Jones
</TABLE>
<TABLE>
<CAPTION>
FOR AGAINST ABSTAIN
<S> <C> <C> <C>
2. Proposal to ratify the appointment of / / / / / /
PricewaterhouseCoopers LLP as the independent
accountants of Odwalla for the fiscal year ending
September 1, 2001.
</TABLE>
Signature(s) Dated: ,2001
------------------------------------------ --------------
This Proxy should be marked, dated and signed by the shareholder(s) exactly as
his or her name appears hereon, and returned promptly in the enclosed envelope.
Persons signing in a fiduciary capacity should so indicate. If shares are held
by joint tenants or as community property, both should sign.
FOLD AND DETACH HERE
