<PAGE>
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
/X/ Filed by Registrant
/ / Filed by a Party other than the Registrant
Check the appropriate box:
/X/ Preliminary Proxy Statement
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
BEV-TYME, INC.
(Name of Registrant As Specified in its Charter)
ROBERT FORST, SECRETARY, BEV-TYME, INC.
(Name of Person(s) Filing the Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
N/A
2) Aggregate number of securities to which transaction applies:
N/A
3) Per unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11:(1)
N/A
4) Proposed maximum aggregate value of transaction:
N/A
(1) Set forth the amount on which the filing fee is calculated and state how it
was determined.
/ / 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 date of its filing.
1) Amount Previously Paid:
N/A
2) Form, Schedule or Registration Statement No.:
N/A
3) Filing Party:
N/A
4) Date Filed:
N/A
<PAGE>
BEV-TYME, INC.
134 Morgan Avenue
Brooklyn, New York 11237
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON JULY 16, 1996
To the Stockholders of Bev-Tyme, Inc.:
NOTICE IS HEREBY GIVEN that the special meeting of stockholders (the
"Special Meeting") of Bev-Tyme, Inc., a Delaware corporation (the "Company"),
will be held on July 16, 1996 at 10:00 A.M., local time, at The Doral Inn, 541
Lexington Avenue, New York, NY to consider and vote upon the following proposals
and such business as may properly come before the Special Meeting:
1. To effect a reverse stock split of the Company's issued common stock, par
value $.0001 per share ("Common Stock") on the basis of one (1) new share
of Common Stock for each ten (10) shares of Common Stock outstanding (the
"Reverse Stock Split"); and
2. To transact such other business as may properly come before the Special
Meting or any adjournments thereof.
The Board of Directors has fixed the close of business on June 10, 1996 as
the record date (the "Record Date") for the determination of stockholders
entitled to notice and vote at the Special Meeting, or any adjournment or
postponements thereof.
You are cordially invited to attend the Special Meeting. Whether or not you
plan to attend the meeting, please sign, date and return your proxy in the reply
envelope provided. Your cooperation in promptly signing and returning your proxy
will help avoid further solicitation expense.
Stockholders are requested to carefully read and review the accompanying
Proxy Statement before executing and returning the Proxy to the Company or
voting in person at the Special Meeting.
By Order of the Board of Directors
of Bev-Tyme, Inc.
Robert Sipper, Chief Executive
Officer, President and Director
Dated: June , 1996
<PAGE>
BEV-TYME, INC.
134 MORGAN AVENUE
BROOKLYN, NEW YORK 11237
(718) 894-4300
PROXY STATEMENT FOR SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON JULY 16, 1996
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
GENERAL
This Proxy Statement is furnished to stockholders of Bev-Tyme, Inc., a
Delaware corporation (the "Company"), in connection with the solicitation of
proxies by the Board of Directors for the special meeting of stockholders to be
held at The Doral Inn, 541 Lexington Avenue, New York, New York on July 16, 1996
at 10:00 A.M., local time, and any adjournments or postponements thereof (the
"Special Meeting"). This Proxy Statement and the attached Notice of Special
Meeting are first being mailed to stockholders of the Company on or about June ,
1996.
At the Special Meeting, stockholders will be asked to approve and consent:
1. To effect a reverse stock split of the Company's issued common stock,
par value $.0001 per share ("Common Stock") on the basis of one (1) new
share of Common Stock for each ten (10) shares of Common Stock
outstanding (the "Reverse Stock Split"); and
2. To transact such other business as may properly come before the Special
Meeting or any adjournments thereof.
Voting at the Special Meeting
The Board of Directors of the Company has fixed the close of business on
June 10, 1996 as the record date (the "Record Date") for the determination of
stockholders entitled to notice of and to vote at the Special Meeting. At the
close of business on the Record Date, there were (i) [9,242,204] shares of the
Company's common stock, $.0001 par value (the "Common Stock"), issued and
outstanding, each of which is entitled to one vote at the Special Meeting and
(ii) [1,652,225] shares of the Company's Series C Convertible Preferred Stock,
par value $.0001 per share (the "Series C Preferred Stock"), each of which is
entitled to eighteen votes at the Special Meeting. The Company has approximately
holders of record.
The presence in person or by proxy of holders of record of a majority of
the shares outstanding and entitled to vote as of the Record Date shall be
required for a quorum to transact business at the Special Meeting. If a quorum
should not be present, the Special Meeting may be adjourned until a quorum is
obtained. The affirmative vote of the holders of a majority of the issued and
outstanding shares of the capital stock of the Company entitled to vote is
necessary to approve the Reverse Stock Split. Accordingly, an abstention or
broker non-votes with respect to Proposal 1 will have the effect as a negative
vote on Proposal 1. Brokers who hold shares in street name may vote on behalf of
beneficial owners with respect to Proposal 1 so long as such broker has not been
instructed as to how to vote by the beneficial owner. The Board of Directors
recommends voting FOR Proposals 1. Unless otherwise instructed, proxies
solicited by the Board of Directors will be voted FOR Proposals.
In order to vote in favor of or against any of the proposals at the Special
Meeting, stockholders may attend the Special Meeting or deliver executed proxies
to the Secretary of the Company at 134 Morgan
<PAGE>
Avenue, Brooklyn, NY 11237 on or before the date of the Special Meeting.
Stockholders attending the meeting may abstain from voting by marking the
appropriate boxes designated as Abstain on the Proxy. Abstentions shall be
counted separately and shall be used for purposes of calculating a quorum.
It is not anticipated that any other matters will be brought before the
Special Meeting.
Proxy Solicitation
The expense of preparing, printing and mailing this Proxy Statement,
exhibits and the proxies solicited hereby will be borne by the Company. In
addition to the use of the mails, proxies may be solicited by officers and
directors and regular employees of the Company, without additional remuneration,
by personal interviews, telephone, telegraph or facsimile transmission. The
Company will also request brokerage firms, nominees, custodians and fiduciaries
to forward proxy materials to the beneficial owners of shares of capital stock
held of record and will provide reimbursements for the cost of forwarding the
material in accordance with customary charges.
Voting Securities and Principal Holders Thereof
The following table sets forth as of the Record Date, certain information
with respect to the beneficial ownership of Common Stock by each person or
entity known by the Company to be the beneficial owner of 5% or more of such
shares, each director of the Company, and all officers and directors of the
Company as a group:
<TABLE>
<CAPTION>
Shares of Common Stock Shares of Preferred Stock
------------------------------------------------------------
Amount Approximate Amount Approximate
Name and Address Beneficially Percentage (%) Beneficially Percentage (%)
of Beneficial Owner Owned of Class Owned of Class
- ------------------- ----------- -------------- ------ --------
<S> <C> <C> <C> <C>
Robert Sipper.................. 75,000(1) .8 75,000(2) 4.3
President and Chairman of
the Board
c/o Bev-Tyme, Inc.
134 Morgan Avenue
Brooklyn, NY 11237
Hartley T. Bernstein........... 75,000(1) .8 75,000(2) 4.3
Director
c/o Bernstein & Wasserman
950 Third Avenue
New York, NY 10022
Alfred Sipper .................. 150,676(1) 1.6 75,000(2) 4.3
Director
c/o Mootch & Muck, Inc.
134 Morgan Avenue
Brooklyn, NY 11237
Bruce Logan................... 75,000(1) 4.1 75,000(2) 4.3
Director
25 Central Park West
New York, NY 10023
2
<PAGE>
</TABLE>
<TABLE>
<CAPTION>
Shares of Common Stock Shares of Preferred Stock
Amount Approximate Amount Approximate
Name and Address Beneficially Percentage (%) Beneficially Percentage (%)
of Beneficial Owner Owned of Class Owned of Class
- ------------------- ----------- -------------- ------ --------
<S> <C> <C> <C> <C>
Robert Forst ---- ---- 75,000(2) 4.3 ----
Chief Financial Officer
Bev-Tyme, Inc.
134 Morgan Avenue
Brooklyn, NY 11237
All Officers & Directors 375,676 3.9 375,000 18.5%
as a Group (4 Persons)
- --------------
(1) Includes 75,000 shares of Common Stock issuable upon the exercise of 75,000
stock options at an exercise price of $0.69 per share.
(2) Includes 75,000 shares of Series C Preferred Stock issuable upon the
exercise of 75,000 stock options at an exercise price of $2.00 per share.
Executive Compensation
The following table sets forth the compensation paid to the Named Executive
Officers for the calendar years ending December 31, 1995, December 31, 1994 and
December 31, 1993.
</TABLE>
<TABLE>
<CAPTION>
Summary Compensation Table
--------------------------
Annual Compensation Awards Long-Term Compensation
-------------------------- ----------------------
(a) (b) (c) (d) (e) (f)
Other Annual Restricted Stock Option
Name and Principal Position Year Salary Compensation Award Grants
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>>
Robert Sipper, President and 1995 $95,457 150,000
Chief Executive Officer 1994 $87,333 -- -- 75,000
Marshall Becker, President 1993 $140,192 -- -- --
and Chief Executive 1992 62,790 -- -- 67,259
Officer(1) 1991 --- $41,052 $42,000 --
Alfred Sipper 1995 155,235 150,000
President and Chief 1994 $142,024 -- -- 75,000
Executive Officer of 1993 $124,685 -- -- --
Mootch & Muck, Inc. (2)
</TABLE>
(1) Resigned as Chairman of the Board and Chief Executive Officer on
January 7, 1994. Of the 67,259 stock options granted 40,299 options did
not vest as of the date of Mr. Becker's resignation. Mr. Becker has
waived all rights to the remaining stock options. In April 1991, Mr.
Becker received 84,996 shares of restricted stock in exchange for services
rendered.
(2) Mootch & Muck, Inc. became a subsidiary when the Company acquired a 51%
interest in May 1993. Prior to that Mootch & Muck, Inc. was an unaffiliated
company.
The following table sets forth certain information with respect to options
granted during the last fiscal year to the Company's Chief Executive Officer and
the other executive officers named in the above Summary Compensation Table.
3
<PAGE>
Option/SAR Grants In Last Fiscal Year
<TABLE>
<CAPTION>
Name Number of Securities Percent of Total Exercise or
Underlying Options/SARS Granted to Base Price
Options/SARS Granted Employees in Fiscal Year ($/Sh) Expiration Date
(#)(1)
<S> <C> <C> <C> <C>
Robert Sipper 75,000 9.1% 2.00 May 31, 2000
75,000 9.1% 2.00 Nov. 30, 2000
Alfred Sipper 75,000 9.1% 2.00 May 31, 2000
75,000 9.1% 2.00 Nov. 30, 2000
</TABLE>
- ------------------------
(1) Options are exercisable for shares of Series C Preferred Stock.
Aggregate Option/SAR Exercises In Last Fiscal Year And
Fiscal Year-End Option/SAR Values
The following table sets forth certain information with respect to options
exercised during the last fiscal year by the Company's Chief Executive Officer
and the executive officers named in the Summary Compensation Table, and with
respect to unexercised options held by such persons at the end of the last
fiscal year:
<TABLE>
<CAPTION>
Shares Number of Securities Value of Unexercised in the
Acquired on Value Realized Underlying Unexercised Money Options/SARs at
Name Exercise (#)(1) $ Options/SARS at FY-End (#) FY-End ($) (2)
---- --------------- -------------- -------------------------- ---------------------------
<S> <C> <C> <C> <C> <C> <C>
Exercisable Unexercisable Exercisable Unexercisable
Robert Sipper 75,000 168,750 ------- 75,000 ------ 375,000
Alfred Sipper 75,000 168,750 ------- 75,000 ------ 375,000
</TABLE>
- ----------------------
(1) Options are exercisable for shares of Series C Preferred Stock.
(2) Based upon a closing bid price December 29, 1995 of $7.00 per share as
reported by The Nasdaq Stock Market.
The Company pays its directors who are not also employees of the Company
$500 for each meeting attended and reimburses such directors for travel and
other expenses incurred by them in connection with attending Board of Directors
meetings.
On August 5, 1994, the Company issued options to purchase 75,000 shares of
Common Stock at $.69 per share (the fair market value of the Company's Common
Stock on the date of grant) to certain members of senior management and to each
of the members of the Company's Board of Directors.
In May 1995, the Company issued to certain officers and directors options
to purchase an aggregate of 525,000 shares of the Company's Series C Preferred
Stock at an exercise price of $2.00 per share, all of which shares were
registered with the Securities and Exchange Commission on Form S-8. In October,
1995,
4
<PAGE>
the holders thereof exercised such options.
In November 1995, the Company issued to the directors of the Company
options to purchase an aggregate of 450,000 shares of Series C Preferred Stock
at an exercise price of $2.00 per share. None of such options have been
exercised.
In March 1995, the Company issued to an officer of the company an option to
purchase an aggregate of 75,000 shares of Series C Preferred Stock at an
exercise price of $2.00 per shares. None of such optoins have been exercised.
Employment Agreements
On May 12, 1993, Mootch & Muck, Inc., the Company's wholly owned
subsidiary, entered into a twelve (12) year full-time employment agreement with
Alfred Sipper, which may be extended for two years at Mr. Sipper's option.
Pursuant to the agreement, he will serve as President and Chief Executive
Officer of M&M at an annual compensation of $140,000 per year, subject to
cost-of-living adjustments, bonuses and salary increases based upon performance.
As of May 12, 1995, Alfred Sipper's employment agreement with Mootch & Muck,
Inc. was amended and restated. Pursuant to the terms of the amended and restated
employment, (i) Mr. Sipper has agreed to serve as President and Chief Executive
Officer of Mootch & Muck, Inc. until May 12, 2009, (ii) Mr. Sipper will receive
an annual salary of $165,200 per year, plus an annual salary increase of 5% or
such greater amount as determined by the Board of Directors of the Company based
upon reasonable criteria. The Company also agreed to provide (i) an annual bonus
of options to purchase (x) 75,000 shares of Series C Preferred Stock at an
exercise price equal to 80% of the fair market value of the Company's Series C
Preferred Stock at the time of grant and (y) 150,000 shares of Common Stock at
an exercise price equal to 80% of the fair market value of the Company's Common
Stock of the time of grant and (ii) to reimburse Mr. Sipper for all
out-of-pocket business expenses, including automobile expenses up to $800 per
month.
On May 12, 1993, the Company's wholly owned subsidiary, Mootch & Muck,
Inc., entered into Employment Agreements with Robert J. Sipper, the Company's
Chief Executive Officer and President, Khosrow Foroughi, the Company's Executive
Vice President, and William Swedelson, the Company's Vice President of Sales.
Each of the Agreements was for a period of four years and contained customary
provisions regarding termination, confidentiality and reimbursement of bona fide
business expenses. Mr. Sipper, Mr. Foroughi and Mr. Swedelson each received an
annual salary of $85,750, $64,090 and $70,720, respectively, subject to increase
by the Board of Directors based upon the Company's performance and other
reasonable criteria.
As of May 12, 1995, Robert Sipper's employment agreement with Mootch &
Muck, Inc. was amended and restated. Pursuant to the terms of the amended and
restated employment, (i) Mr. Sipper has agreed to serve as Senior Vice President
and Chief Operating Officer of Mootch & Muck, Inc. until May 12, 2001, (ii) Mr.
Sipper will receive an annual salary of $101,600 per year, plus an annual salary
increase of 5% or such greater amount as determined by the Board of Directors of
the Company based upon reasonable criteria. The Company also agreed to provide
(i) an annual bonus of options to purchase (x) 75,000 shares of Series C
Preferred Stock at an exercise price equal to 80% of the fair market value of
the Company's Series C Preferred Stock at the time of grant and (y) 150,000
shares of Common Stock at an exercise price equal to 80% of the fair market
value of the Company's Common Stock of the time of grant and (ii) to reimburse
Mr. Sipper for all out-of-pocket business expenses, including automobile
expenses up to $800 per month.
As of May 12, 1995, William Swedelson's employment agreement with Mootch &
Muck, Inc. was
5
<PAGE>
amended and restated. Pursuant to the terms of the amended and restated
employment, (i) Mr. Swedelson has agreed to serve as Vice President - Sales of
Mootch & Muck, Inc. until May 12, 2001, (ii) Mr. Swedelson will receive an
annual salary of $83,800 per year, plus an annual salary increase of 5% or such
greater amount as determined by the Board of Directors of the Company based upon
reasonable criteria. The Company also agreed to provide (i) an annual bonus of
options to purchase (x) 75,000 shares of Series C Preferred Stock at an exercise
price equal to 80% of the fair market value of the Company's Series C Preferred
Stock at the time of grant and (y) 150,000 shares of Common Stock at an exercise
price equal to 80% of the fair market value of the Company's Common Stock of the
time of grant and (ii) to reimburse Mr. Swedelson for all out-of-pocket business
expenses, including automobile expenses up to $800 per month.
As of April 1, 1994, the Company entered into an Employment Agreement with
A. Alexander Watson. Pursuant to the terms of the agreement, Mr. Watson serves
as the Company's Manager of Marketing and Product Development on a full time
basis for a period of five years. Mr. Watson is entitled to receive a base
annual salary of $20,800 plus a monthly commission based upon sales of the
Company's Taste of Jamaica(Registered) products.
Stock Option Plans and Agreements
Incentive Option and Stock Appreciation Rights Plan--In November 1992, the
Directors of the Company adopted and the stockholders of the Company approved
the adoption of the Company's 1992 Incentive Stock Option and Stock Appreciation
Rights Plan ("Incentive Option Plan"). The purpose of the Incentive Option Plan
is to enable the Company to encourage key employees and Directors to contribute
to the success of the Company by granting such employees and Directors incentive
stock options ("ISOs"), as well as non-qualified options and stock appreciation
rights ("SARs").
The Incentive Option Plan will be administered by the Board of Directors or
a committee appointed by the Board of Directors (the "Committee") which will
determine, in its discretion, among other things, the recipients of grants,
whether a grant will consist of ISOs, non-qualified options or SARs (in tandem
with an option or freestanding) or a combination thereof, and the number of
shares to be subject to such options and SARs.
The Incentive Option Plan provides for the granting of ISOs to purchase
Common Stock at an exercise price to be determined by the Board of Directors or
the Committee not less than the fair market value of the Common Stock on the
date the option is granted. Non-qualified options and freestanding SARs may be
granted with any exercise price. SARs granted in tandem with an option have the
same exercise price as the related option.
The total number of shares with respect to which options and SARs may be
granted under the Incentive Option Plan is 75,000. ISOs may not be granted to an
individual to the extent that in the calendar year in which such ISOs first
become exercisable the shares subject to such ISOs have a fair market value on
the date of grant in excess of $100,000. No option or SAR may be granted under
the Incentive Option Plan after November 24, 2002 and no option or SAR may be
outstanding for more than ten years after its grant. Additionally, no option or
SAR can be granted for more than five (5) years to a shareholder owning 10% or
more of the Company's outstanding Common Stock.
Upon the exercise of an option, the holder must make payment of the full
exercise price. Such payment may be made in cash or in shares of Common Stock,
or in a combination of both. The Company
6
<PAGE>
may lend to the holder of an option funds sufficient to pay the exercise price,
subject to certain limitations. SARs may be settled, in the Board of Directors'
discretion, in cash, Common Stock, or in a combination of cash and Common Stock.
The exercise of SARs cancels the corresponding number of shares subject to the
related option, if any, and the exercise of an option cancels any associated
SARs. Subject to certain exceptions, options and SARs may be exercised any time
up to three months after termination of the holder's employment.
The Incentive Option Plan may be terminated or amended at any time by the
Board of Directors, except that, without stockholder approval, the Incentive
Option Plan may not be amended to increase the number of shares subject to the
Incentive Option Plan, change the class of persons eligible to receive options
or SARs under the Incentive Option Plan or materially increase the benefits of
participants.
The Company issued incentive options to purchase an aggregate of 60,000
shares of Common Stock to four sales management personnel. The options are
exercisable at $1.00 per share for a period of four years commencing in August
1994.
Non-Qualified Option Plan--In November 1992, the Directors and
stockholders of the Company adopted the 1992 Non-Qualified Stock Option Plan
(the "Non-Qualified Option Plan"). The purpose of the Non-Qualified Option Plan
is to enable the Company to encourage key employees, Directors, consultants,
distributors, professionals and independent contractors to contribute to the
success of the Company by granting such employees, Directors, consultants,
distributors, professionals and independent contractors non-qualified options.
The Non-Qualified Option Plan will be administered by the Board of Directors or
the Committee in the same manner as the Incentive Option Plan.
The Non-Qualified Option Plan provides for the granting of non-qualified
options at such exercise price as may be determined by the Board of Directors,
in its discretion. The total number of shares with respect to which options may
be granted under the Non-Qualified Option Plan is 125,000.
Upon the exercise of an option, the holder must make payment of the full
exercise price. Such payment may be made in cash or in shares of Common Stock
(based on the fair market value of the Common Stock on the date prior to
exercise), or in a combination of both. The Company may lend to the holder of an
option funds sufficient to pay the exercise price, subject to certain
limitations. Subject to certain exceptions, options may be exercised any time up
to three months after termination of the holder's employment.
The Non-Qualified Option Plan may be terminated or amended at any time by
the Board of Directors, except that, without stockholder approval, the
Non-Qualified Option Plan may not be amended to increase the number of shares
subject to the Non-Qualified Option Plan, change the class of persons eligible
to receive options under the Non-Qualified Option Plan or materially increase
the benefits of participants.
In August 1994, the Company issued to certain sales representatives an
aggregate of 25,000 non-qualified options under the Non Qualified Option Plan.
The options are exercisable at $1.00 per share for a period of four years
commencing in August 1994.
Other Options
In May, 1995, the Company issued to certain officers and directors options
to purchase an aggregate
7
<PAGE>
of 525,000 shares of the Company's Series C Preferred Stock at an exercise price
of $2.00 per share, all of which shares were registered with the Securities and
Exchange Commission on Form S-8. In October, 1995, the holders thereof exercised
such options.
In November 1995, the Company issued to the directors of the Company
options to purchase an aggregate of 525,000 shares of Series C Preferred Stock
at an exercise price of $2.00 per share. None of such options have been
exercised.
Directors and Executive Officers
The names and ages of the directors and executive officers of the Company
are set forth below:
<TABLE>
<CAPTION>
Name Age Position
- ---- --- --------
<S> <C> <C>
Robert Sipper....................... 42 Chief Executive Officer,
President and Director
Hartley T. Bernstein.............. 44 Director
Alfred Sipper...................... 62 Director
Bruce Logan....................... 64 Director
Robert Forst(1)...................... 46 Chief Financial Officer
</TABLE>
- ----------------
(1) Mr. Forst commenced working for the Company in March 1996.
Robert Sipper has been a director of the Company since November 1993 and
Chief Executive Officer and President of the Company since January, 1994. He
graduated with a J.D. degree from Vermont Law School in 1978 and entered private
practice, He was associated with Dubbs, Leopold, Davis & DePodwin, Attorneys at
Law from 1979-1981. He became a partner in the law firm of Leopold & Sipper.
Attorneys at Law, from 1981 to March 1989. In March, 1989, Mr. Sipper left the
private practice of law and became Chief Operating Officer/Executive Vice
President of Mootch & Muck, a position he holds today, which was the master
Evian distributor for the Metropolitan New York - New Jersey territory as well
as the distributor of many other beverages and selected specialty foods. Mr.
Sipper established a subdistributor network for Evian and other products in this
territory. In 1990, Mr. Sipper negotiated the sale of Mootch & Muck's Evian
Master Distributor Agreement to Canada Dry Bottling Company of New York.
Hartley T. Bernstein has been a Director since June, 1992 and is a member
of the law firm of Bernstein & Wasserman specializing in corporate and
securities law. Mr. Bernstein graduated from Columbia University with a B.A. in
1973 and received his J.D. from New York University School of Law in 1976. He
was associated with the firm of Parker Chapin Flattau & Klimpl from 1976-1977,
served as an Assistant District Attorney for New York County from 1977-1979 and
was associated with the law firm of Guggenheimer & Untermyer from 1979-1982. In
1982, Mr. Bernstein formed his own law practice which subsequently merged with
his present firm. Mr. Bernstein also serves as a director of PDK Labs Inc., and
Futurebiotics, Inc., each a public company. Mr. Bernstein has served as a
director of Celebrity Resorts, Inc.
8
<PAGE>
from November 20, 1989 to February 27, 1992. Mr. Bernstein also served as a
director of DreamCar Holdings, Inc., commencing July 13, 1989 and ending as of
August 1992. Mr. Bernstein is a member of the adjunct faculty of Yale Law School
where he teaches a course in securities law and has served previously on the
adjunct faculties of New York Law School and Mercy College. He is also an
instructor at the National Institute of Trial Advocacy and a member of the
Boards of Arbitration of the National Association of Securities Dealers, Inc.
and the New York Stock Exchange. Mr. Bernstein serves as a commentator on
securities law matters on the nationally syndicated Business Radio Network and
Money Radio. The law firm of Bernstein & Wasserman, of which Mr. Bernstein is a
partner, has acted as legal counsel to the Company and has represented the
Underwriter on matters unrelated to this offering.
Bruce Logan, has been a director of the Company since August 1994. Since
1991, Mr. Logan has been the chairman of New York Media, Inc., a New York City
based producer of custom publications, and newsletters for the restaurant
industry. Mr. Logan co-founded Magazine Networks and it was subsequently sold to
3M Corporation. Mr. Logan is currently Chairman of New York Hospital's Community
Advisory Board.
Alfred Sipper, has been a director of the Company since March 1994. Mr.
Sipper has been President of Mootch & Muck, Inc. since 1977 and was President of
PIK Groceries, Inc. from 1952 until 1983.
Robert Forst, has been the Chief Financial Officer of the Company since
March 1996. Mr. Forst was Controller of Empire Taxi and Limo Co. from August,
1985 through August, 1995. Mr. Forst was the Assistant Controller of Value Line,
Inc. from July, 1979 through July, 1985. He also worked for Americana Hotels,
Inc. from June 1972 through July 1979. Mr. Forst received his undergraduate
degree from St. John's University.
There are no family relationships among any of the directors or executive
officers of the Company, except that Alfred Sipper, a director of the Company
and Chief Executive Officer of Mootch & Muck, Inc., is the father of Robert
Sipper, President and Chairman of the Board of the Company and Chief Operating
Officer of Mootch & Muck. The Company pays its directors who are not also
employees of the Company $500 for each meeting attended and reimburses such
directors for travel and other expenses incurred by them in connection with
attending Board of Directors meetings. In November 1993, the board suspended the
payment of director's fees indefinitely. Directors are elected annually at the
Company's regular annual meeting of stockholders.
In May, 1995, the Company issued to certain of the Company's officers,
directors and employees options to purchase an aggregate of 525,000 shares of
Series C Preferred Stock at an exercise price of $2.00 per share, all of which
shares were registered with the Securities and Exchange Commission on Form S-8
for sale to the public. In October, 1995, all of such options were exercised.
In November 1995, the Company issued to the directors of the Company
options to purchase an aggregate of 300,000 shares of Series C Preferred Stock
at an exercise price of $2.00 per share. None of such options have been
exercised.
Compliance with Section 16(a) of The Securities Exchange Act of 1934
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Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than ten percent
(10%) of a registered class of the Company's equity securities, to file with the
Securities and Exchange Commission initial reports of ownership and reports of
changes in ownership of common stock and other equity securities of the Company.
Officers, directors and greater than ten percent shareholders are required by
SEC regulation to furnish the Company with copies of all Section 16(a) forms
they file.
Except as provided below, to the Company's knowledge, based solely on its
review of the copies of such reports furnished to the Company during the years
ended December 31, 1994 and December 31, 1995, all Section 16(a) filing
requirements applicable to its officers, directors and greater than ten percent
beneficial owners were satisfied.
PROPOSAL NO. 1:
REVERSE STOCK SPLIT
General. Stockholders are being asked to approve a one-for-ten reverse
stock split of the Common Stock of the Company which may be considered a
modification or exchange of securities invoking the requirements of Item 12 of
Rule 14a-101 of the Securities Exchange Act of 1934. In compliance therewith,
the Company has attached hereto its Annual Report on Form 10-KSB (as amended)
for the year ended December 31, 1995 which is incorporated by reference herein.
The Board of Directors believes that it would be in the best interests of
both the Company and its stockholders to effect the reverse stock split of one
share of newly issued Common Stock ("New Common Stock") for each ten (10) shares
of the Company's presently issued and outstanding Common Stock (the "Reverse
Stock Split"). This amendment has been adopted by the Board of Directors subject
to approval of the Company's stockholders. Approval will require the affirmative
vote of the holders of a majority of the outstanding shares of Common Stock. The
Board of Directors reserves the right, notwithstanding stockholder approval and
without further action by the stockholders, not to proceed with the Reverse
Stock Split, if, at any time prior to filing the amendment with the Secretary of
State of the State of Delaware, the Board of Directors, in its sole discretion,
determines that the Reverse Stock Split is no longer in the best interests of
the Company and its stockholders.
The Company is authorized to issue 75,000,000 shares of Common Stock,
$.0001 par value, of which 9,242,204 shares were issued and outstanding at the
close of business on the Record Date. As proposed and if effected, the Reverse
Stock Split would reduce the number of issued and outstanding shares to
approximately 925,000. The proposed Reverse Stock Split would not affect any
stockholder's proportionate equity interest in the Company, except for those
stockholders who would receive cash in lieu of fractional shares. Neither the
par value of the Common Stock nor any rights presently accruing to holders of
Common Stock would be affected by this transaction.
Reasons for the Proposed Stock Split. The Company's Common Stock is traded on
The Nasdaq SmallCap Market ("Nasdaq"). Under the rules of Nasdaq in order to
qualify for continued quotation of securities on Nasdaq, the Company, among
other things, must have either (i) $2,000,000 in assets, $1,000,000 in
stockholder equity and a minimum bid price of $1.00 per share (the " Minimum Bid
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Requirement") or alternatively (ii) $2,000,000 in total capital and surplus, and
$1,000,000 in market value of public float (the "Capital/Market Value
Requirement"). On , 1996, the Company's Common Stock had a closing price of
$.___.
On December 22, 1995, the Staff of Nasdaq advised the Company that the
Company failed to satisfy the Capital/Market Value Requirement and the Minimum
Bid Requirement with respect to its shares of Common Stock. The Company was then
provided 90 days to comply with either of such requirements in order to continue
the listing of its Common Stock on Nasdaq. Failure to do so would result in
delisting the Company's shares of Common Stock. On February 29, 1996, the
Company notified the staff that it had satisfied the Capital/Market Value
Requirement, and therefore, requested confirmation of continued listing. On
April 22, 1996, the Staff, indicated its concern with the Company's continued
ability to satisfy the Capital/Market Value requirement. The Company then
requested a hearing at which it could demonstrate compliance and satisfy the
concerns of Nasdaq.
At the hearing on May 14, 1996, the Company demonstrated its compliance
with the Capital/Market Value Requirement, which had been satisfied, in part,
through the issuance of shares of common stock to non-affiliates of the Company.
In addition, the Company offered to effect a reverse split with respect to its
shares of Common Stock with the intent of satisfying the Minimum Bid Requirement
as well. By letter dated May 20, 1996, the staff advised the Company that it
would grant continued listing of the Company's shares of Common Stock so long as
the Company effected a reverse split with respect to its shares of Common Stock
by July 19, 1996 and the bid price for the shares of Common Stock remains at or
above $1.00 for 10 consecutive trading days thereafter. If the Company fails to
comply with this request, the shares of Common Stock would be delisted.
The Board of Directors believes that a Reverse Stock Split will, among
other things, enable the Company to meet the Minimum Bid Requirement.
Furthermore, a relatively low stock price may affect not only the liquidity of
the Company's Common Stock, but also its ability to raise additional capital
through the sale of equity securities. Thus, the Company believes that the
expected increase in trading price is expected to be attractive to the financial
community, the investing public, and to users of the Company's products.
The Board of Directors is hopeful that a decrease in the number of shares
of Common Stock outstanding, as a consequence of the proposed Reverse Stock
Split, and the anticipated corresponding increase price per share will stimulate
interest in the Company's Common Stock and possibly promote greater liquidity
for the Company's Common stockholders with respect to those shares presently
held by them. However, the possibility does exist that such liquidity could be
adversely affected by the reduced number of shares which would be outstanding if
the proposed Reverse Stock Split is effected.
If, in the future, the Company is unable to satisfy either the Minimum Bid
Requirement or the Capital/Market Requirement, trading, if any, in the Company's
securities would be conducted in the over-the-counter market in what are
commonly referred to as the "pink sheets", or the NASD Electronic Bulletin
Board. As a result, an investor may find it more difficult to dispose of, or to
obtain accurate quotation as to the price of, the securities of the Company. In
addition, if the securities are removed from Nasdaq, they could be subject to
rules that impose additional sales practice requirements on broker-dealers who
sell such securities.
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Management of the Company is not aware of any present efforts of any
persons to accumulate Common Stock or to obtain control of the Company, and the
proposed Reverse Stock Split of Common Stock is not intended to be an
anti-takeover device. The amendment is being sought solely to enhance the image
of the Company, its corporate flexibility, and to price the Common Stock in the
price range that would meet the Minimum Bid Requirements and be more acceptable
to the brokerage community, and to investors generally.
Exchange of Stock Certificates. If the amendment is approved by the Company's
stockholders, the Company will instruct its transfer agent will act as its
exchange agent (the "Exchange Agent") and to act for holders of Common Stock in
implementing the exchange of their certificates.
Commencing on July 17, 1996 (the "Effective Date"), stockholders will be
notified and requested to surrender their certificates representing shares of
Common Stock to the Exchange Agent in exchange for certificates representing New
Common Stock. One share of New Common Stock will be issued in exchange for each
ten (10) presently issued and outstanding shares of Common Stock. Beginning on
the Effective Date, each certificate representing shares of the Company's Common
Stock will be deemed for all corporate purposes to evidence ownership of shares
of New Common Stock. To the extent a stockholder holds a number of shares not
evenly divisible by ten (10), the Company will issue additional shares of Common
Stock.
Liquidation of Fractional Shares. No scrip or fractional certificates will be
issued in connection with the Reverse Stock Split. Stockholders who ostensibly
would be entitled to receive fractional shares because they hold a number of
shares of Common Stock not evenly divisible by ten (10) will be entitled, upon
surrender to the Exchange Agent of certificates representing such shares, to
receive one (1) additional share of Common Stock for any fractional share they
may be entitled to. Stockholders may now hold "odd lots" as a result of the
Reverse Stock Split and as such may be subject to increased transaction costs on
the sale of their Common Stock.
Stockholders are encouraged to surrender their certificates to the Exchange
Agent for certificates evidencing whole shares of the Common Stock due them for
fractional interests.
Federal Income Tax Consequences. The Reverse Stock Split should not result in
the recognition of gain or loss (except in the case of additional shares
received for fractional shares as described below). The holding period of the
shares of New Common Stock will include the stockholders' respective holding
periods for the shares of Common Stock exchanged therefore, provided that the
shares of Common Stock were held as a capital asset. The adjusted basis of the
shares of New Common Stock will be the same as the adjusted basis of the Common
Stock exchanged therefore, reduced by the basis applicable to the receipt of
additional shares in lieu of fractional shares described below.
A stockholder who receives additional shares in lieu of fractional shares
will be treated as if the Company would issue additional shares to him. Such
stockholder should generally recognize gain or loss, as the case may be,
measured by the difference between the number of additional shares received and
the basis of his old Common Stock applicable to such fractional shares had they
actually been issued. Such gain or loss shall be a capital gain or loss (if such
stockholder's Common Stock was held as a capital asset), any such capital gain
or loss shall generally be long-term capital gain or loss to the extent such
stockholder's holding for his Common Stock exceeds twelve months.
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No Dissenter's Rights. Under Delaware law, stockholders are not entitled to
dissenter's rights of appraisal with respect to the Reverse Stock Split.
MISCELLANEOUS
Revocation of Proxies
If the Special Meeting is adjourned, for whatever reason, Proposal 1 shall
be considered and voted upon by stockholders at the subsequent "adjourned or
postponed meeting", if any.
You may revoke your proxy at any time prior to its exercise by attending
the Special Meeting and voting in person, although attendance at the Special
Meeting will not in and of itself constitute revocation of a proxy, by giving
notice of revocation of your proxy at the Special Meeting, or by delivering a
written notice of revocation or a duly executed proxy relating to the matters to
be considered at the Special Meeting and bearing a later date to the Secretary
of the Company at 134 Morgan Avenue, Brooklyn, New York 11237. Unless revoked in
the manner set forth above, proxies on the form enclosed will be voted at the
Special Meeting in accordance with your instructions.
Additional Available Information
The Company is subject to the informational filing requirements of the
Securities and Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith, the Company files periodic reports, proxy statements and
other information with the Commission under the Exchange Act relating to its
business, financial condition and other matters. The Company is required to
disclose in such proxy statements certain information as of particular dates,
concerning the Company's directors and officers, their remuneration, options
granted to them, the principal holders of the Company's securities and any
material interests of such persons in transactions with the Company. Such
reports, proxy statements and other information may be inspected at the
Commission's office at 450 Fifth Street, N.W., Washington, D.C. 20549. Copies
may be obtained on payment of the Commission's customary fees by writing to its
principal office at 450 Fifth Street, N.W., Washington, D.C. 20549.
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Other Matters
The Board of Directors of the Company does not intend to bring any other
matters before the Special Meeting and does not know of any other matter that
may be brought before the Special Meeting.
By Order of the Board of Directors
of Bev-Tyme, Inc.
Robert Sipper
Chief Executive Officer
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BEV-TYME, INC.
THIS PROXY IS BEING SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
PLEASE CLEARLY INDICATE A RESPONSE BY CHECKING EITHER THE PROXY (THE "PROXY")
[FOR] OR [AGAINST] BOX NEXT TO EACH OF THE TWO (2) PROPOSALS
The undesigned hereby appoint(s) Mr. Robert Sipper with the power of
substitution and resubstitution to vote any and all shares of capital stock of
Bev-Tyme, Inc. (the "Company") which the undersigned would be entitled to vote
as fully as the undersigned could do if personally present at the Special
Meeting of the Company, to be held on July 16, 1996, at 10:00 A.M. local time,
and at any adjournments thereof, hereby revoking any prior proxies to vote said
stock, upon the following items more fully described in the notice of any proxy
statement for the Special Meeting (receipt of which is hereby acknowledged):
1. REVERSE STOCK SPLIT
VOTE
/ / FOR effecting a 1 for 10 Reverse Stock Split
/ / WITHHOLD AUTHORITY
/ / ABSTAIN
<PAGE>
In his discretion, the Proxy is authorized to vote upon such other business
as may properly come before the meeting.
Please mark, sign date and return this Proxy promptly using the
accompanying postage pre-paid envelope. THIS PROXY IS SOLICITED ON BEHALF OF THE
BOARD OF DIRECTORS OF BEV-TYME, INC.
Dated: _____________________, 1996
__________________________________
Signature
__________________________________
Signature if jointly owned:
__________________________________
Print name:
Please sign exactly as the name appears on your stock certificate. When shares
of capital stock are held by joint tenants, both should sign. When signing as
attorney, executor, administrator, trustee, guardian, or corporate officer,
please include full title as such. If the shares of capital stock are owned by a
corporation, sign in the full corporate name by an authorized officer. If the
shares of capital stock are owned by a partnership, sign in the name of the
partnership by an authorized officer.
PLEASE MARK, DATE, SIGN AND RETURN THIS PROXY PROMPTLY
IN THE ENCLOSED ENVELOPE
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