<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
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 Section 240.14a-11(c) or Section 240.14a-12
THE BOSTON BEER COMPANY, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[_] $125 Per Exchange Act Rules O-11(c)(1)(ii), 14a-6(I)(2) or Item 22(a)(2) of
Schedule 14A.
[_] Fee computed on table below per Exchange Act Rules 14a-6(I)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
-------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-------------------------------------------------------------------------
(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):
-------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-------------------------------------------------------------------------
(5) Total fee paid:
-------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] 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:
-------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-------------------------------------------------------------------------
(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
THE BOSTON BEER COMPANY, INC.
NOTICE OF THE 2000 ANNUAL MEETING OF STOCKHOLDERS
May 30, 2000
To the Stockholders:
The 2000 Annual Meeting of the Stockholders of THE BOSTON BEER COMPANY, INC.
(the "Corporation") will be held on Tuesday, May 30, 2000, at 10:00 a.m. at The
Brewery located at 30 Germania Street, Jamaica Plain, Boston, Massachusetts,
for the following purposes:
1. The election by the holders of the Class A Common Stock of three (3)
Class A Directors, each to serve for a term of one (1) year.
2. For the election by the sole holder of the Class B Common Stock of four
(4) Class B Directors, each to serve for a term of one (1) year.
3. To consider and act upon any other business which may properly come
before the meeting.
The Board of Directors has fixed the close of business on March 31, 2000 as
the record date for the meeting. All stockholders of record on that date are
entitled to notice of and to vote at the meeting.
PLEASE COMPLETE AND RETURN THE ENCLOSED PROXY IN THE ENVELOPE PROVIDED WHETHER
OR NOT YOU INTEND TO BE PRESENT AT THE MEETING IN PERSON.
By order of the Board of Directors
C. James Koch, Clerk
Boston, Massachusetts
April 14, 2000
<PAGE>
THE BOSTON BEER COMPANY, INC.
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of The Boston Beer Company, Inc. (the
"Corporation", which is sometimes referred to in this Proxy Statement,
together with its affiliate, Boston Beer Company Limited Partnership (the
"Partnership"), as the "Company") for use at the 2000 Annual Meeting of
Stockholders to be held on Tuesday, May 30, 2000, at the time and place set
forth in the notice of the meeting, and at any adjournments thereof. The
approximate date on which this Proxy Statement and form of proxy are first
being mailed to stockholders is April 14, 2000.
If the enclosed proxy is properly executed and returned, it will be voted in
the manner directed by the stockholder. If no instructions are specified with
respect to any particular matter to be acted upon, proxies will be voted in
favor thereof. Any person giving the enclosed form of proxy has the power to
revoke it by voting in person at the meeting, or by giving written notice of
revocation to the Clerk of the Corporation at any time before the proxy is
exercised.
The holders of a majority in interest of the issued and outstanding Class A
Common Stock are required to be present in person or to be represented by
proxy at the Meeting in order to constitute a quorum for the election of the
Class A Directors. The election of each of the nominees for Class A Director,
as hereinafter set forth in greater detail, will be decided by plurality vote
of the holders of Class A Common Stock present in person or represented by
proxy at the Meeting. The affirmative vote of the sole holder of the
outstanding shares of Class B Common Stock voting in person or by proxy at the
meeting is required to elect the Class B Directors, as hereinafter set forth
in greater detail, and to approve all other matters listed in the notice of
meeting.
The Corporation will bear the cost of the solicitation. In addition to
mailing this material to shareholders, the Corporation has asked banks and
brokers to forward copies to persons for whom they hold stock of the
Corporation and request authority for execution of the proxies. The
Corporation will reimburse the banks and brokers for their reasonable out-of-
pocket expenses in doing so. Officers and regular employees of the Company,
without being additionally compensated, may solicit proxies by mail,
telephone, telegram, facsimile or personal contact. All reasonable proxy
soliciting expenses will be paid by the Corporation in connection with the
solicitation of votes for the Annual Meeting.
The Corporation's principal executive offices are located at 75 Arlington
Street, Boston, Massachusetts 02116, telephone number (617) 368-5000.
RECORD DATE AND VOTING SECURITIES
Only stockholders of record at the close of business on March 31, 2000 are
entitled to notice of and to vote at the meeting. On that date, the
Corporation had outstanding and entitled to vote 14,352,056 shares of Class A
Common Stock, $.01 par value per share, and 4,107,355 shares of Class B Common
Stock, $.01 par value per share. Each outstanding share of the Corporation's
Class A and Class B Common Stock entitles the record holder to one (1) vote on
each matter properly brought before the Class. The 2,103,900 shares of Class A
Common Stock, $.01 par value per share, held in treasury by the Company at
March 31, 2000 are not deemed outstanding and, therefore, are not entitled to
vote.
Items 1 and 2. ELECTION OF CLASS A AND CLASS B DIRECTORS
The Board of Directors proposes that the total number of Directors be fixed
for the ensuing year at seven (7), consisting of three (3) Class A Directors
to be elected by the holders of the Class A Common Stock for a term of one (1)
year, and four (4) Class B Directors to be elected by the sole holder of the
Class B Common Stock, also for a term of one (1) year.
1
<PAGE>
It is proposed that each of the three (3) nominees for Class A Director and
each of the four (4) nominees for Class B Director listed below whose term
expires at this meeting, be re-elected as Class A and Class B Directors,
respectively, each to serve for a term of one year and until his successor is
duly elected and qualified or until he sooner dies, resigns or is removed.
The person named in the accompanying proxy will vote, unless authority is
withheld, for the election of the nominees named below. In the event that any
of the nominees should become unavailable for election, which is not
anticipated, the person named in the accompanying proxy will vote for such
substitute nominees as the incumbent Class A Directors, acting pursuant to
Section 4.8 of the Corporation's By-Laws as a Nominating Committee, may
nominate. As indicated below, except for Messrs. Cummin, Wing and Hiatt, all
Directors are either Executive Officers of the Corporation or its subsidiaries
or related to such Executive Officers.
Nominees Proposed in Accordance with the Terms of the Articles of
Organization and By-Laws of the Corporation. Set forth below are the nominees
for election as Class A and Class B Directors, respectively, for terms ending
in 2001 and certain information about each of them.
Class A Directors:
<TABLE>
<CAPTION>
Year First
Elected a Position With the Corporation or Principal
Name of Nominee Age Director Occupation During the Past Five Years
--------------- --- ---------- ------------------------------------------
<C> <C> <C> <S>
Pearson C. Cummin, III.. 57 1995 Mr. Cummin has served as a general partner of
Consumer Venture Partners, a Greenwich, Connecticut
based venture capital firm, since January 1986. He
also serves as a Director of Pacific Sunwear of
California, Inc. and Natural Wonders, Inc.
James C. Kautz.......... 69 1995 Mr. Kautz is a non-profit trustee, private investor
and is the second cousin of the Company's founder
and chief executive officer, C. James Koch. Until
1999, Mr. Kautz was a limited partner of The Goldman
Sachs Group, L.P.
Robert N. Hiatt......... 63 1998 Mr. Hiatt was Chairman of Maybelline, Inc. from 1996
until he retired in 1997. From 1990 until 1996, Mr.
Hiatt was President and CEO of Maybelline, Inc. Mr.
Hiatt also served as a Director of Genovese Drug
Stores, Inc. from 1997 to 1999.
Class B Directors:
<CAPTION>
Year First
Elected a Position With the Corporation or Principal
Name of Nominee Age Director Occupation During the Past Five Years
--------------- --- ---------- ------------------------------------------
<C> <C> <C> <S>
C. James Koch........... 50 1995 Mr. Koch founded the Company in 1984 and has been
the Chairman and Chief Executive Officer throughout
the Company's history. Mr. Koch also serves as the
Corporation's Clerk and is the Company's principal
executive officer.
Charles Joseph Koch..... 77 1995 Mr. Koch is the father of founder C. James Koch. In
1989, Mr. Koch retired as founder and co-owner of
Chemicals, Inc., a distributor of brewing and
industrial chemicals in southwestern Ohio.
John B. Wing............ 53 1995 Mr. Wing has been Chairman and CEO of The Wing Group
Limited, Co., a developer of energy projects in
Turkey, Kuwait and China, since 1991.
Martin F. Roper......... 37 1999 Mr. Roper has served as the President of the Company
since December 1999. Mr. Roper joined the Company as
Vice President of Manufacturing and Business
Development in September 1994 and became the COO in
April 1997. Prior to joining the Company, Mr. Roper
had been President of the MEG Division of Steel
Works, Inc. From July 1990 to October 1992, Mr.
Roper was Executive Vice President of Blocksom & Co.
</TABLE>
2
<PAGE>
INFORMATION CONCERNING THE BOARD OF DIRECTORS
During the Corporation's 1999 fiscal year, there were five (5) meetings of
the Board of Directors of the Corporation. All of the Directors, except for
Charles J. Koch, attended at least 75% of the aggregate of (i) the total
number of meetings of the Board of Directors which they were entitled to
attend and (ii) the total number of meetings held by Board of Directors
committees on which they served which they were entitled to attend. In 1999,
Mr. Charles J. Koch attended three (3) of the five (5) meetings of the Board
of Directors. The Class A Directors in office from time to time serve as a
nominating committee for the purpose of nominating persons for election as
Class A Directors. The Corporation does not otherwise have a nominating
committee.
The Audit Committee of the Board of Directors reviews with the Corporation's
independent auditors the scope of the audit for the year, the results of the
audit when completed and the independent auditors' fees for services
performed. The Audit Committee also recommends independent auditors to the
Board of Directors and reviews with management various matters related to its
internal accounting controls. The present members of the Audit Committee are
Pearson C. Cummin, III (Chairman), Robert N. Hiatt, James C. Kautz and John B.
Wing. The Audit Committee met on three (3) occasions in 1999.
The Corporation also has a Compensation Committee, whose purposes are to
make recommendations to the full Board of Directors concerning the
Corporation's Employee Equity Incentive Plan and to otherwise act with respect
to matters of executive compensation. The members of such Committee are
Pearson C. Cummin, III, Robert N. Hiatt, James C. Kautz (Chairman) and John B.
Wing. The Compensation Committee met on two (2) occasions in 1999.
3
<PAGE>
SECURITY OWNERSHIP OF PRINCIPAL HOLDERS OF
VOTING SECURITIES, DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information regarding beneficial
ownership of the Company's Class A Common Stock and Class B Common Stock as of
March 31, 2000 (i) by each person (or group of affiliated persons) known by
the Company to be the beneficial owner(s) of more than five percent (5%) of
the outstanding Class A Common Stock, (ii) by each Director of the Company,
(iii) by each person nominated as a Director of the Company, (iv) by the
Company's Chief Executive Officer and the other officers named below in the
Summary Compensation Table and (v) by all of the Company's executive officers
and Directors as a group. Unless otherwise indicated, the individuals named
below held sole voting and investment power over the shares listed below:
<TABLE>
<CAPTION>
Shares Beneficially Owned(1)
Named Executive Officers, -------------------------------
Directors and 5% Stockholders Number Percent
----------------------------- ---------------- --------------
<S> <C> <C>
C. James Koch(2)(3)............................ 5,343,118 28.9%
Martin F. Roper(3)(4).......................... 389,148 2.1%
Richard P. Lindsay(3)(5)....................... 5,700 *
Jeffrey D. White(3)(6)......................... 11,647 *
Pearson C. Cummin, III(7)...................... 73,923 *
James C. Kautz(3)(8)........................... 532,531 2.9%
Charles Joseph Koch(3)(9)...................... 12,000 *
John B. Wing(10)............................... 381,892 2.1%
Robert N. Hiatt(3)(11)......................... 8,000 *
All Directors and Executive Officers as a group
(10 people)................................... 6,790,836 36.8%
</TABLE>
- --------
*Less than 1% of the outstanding shares of Class A Common Stock.
(1) Beneficial ownership is determined in accordance with the rules of the
Securities and Exchange Commission and includes general voting and/or
investment power with respect to securities. Shares of Class A Common
Stock subject to options and warrants currently exercisable or
exercisable within 60 days after the record date are deemed outstanding
for computing the percentage of a person holding such options but are not
deemed outstanding for computing the percentage of any other person. No
shares of Class B Common Stock are subject to options or warrants. All
shares are Class A Common Stock except for shares of Class B Common Stock
held by C. James Koch. See Note 2 below.
(2) Includes 4,107,355 shares of Class B Common Stock, constituting all of
the outstanding shares of Class B Common Stock. Includes 353,107 shares
of Class A Common Stock held in several trusts for the benefit of C.
James Koch and certain of his family members; does not include shares
deposited in Exchange Funds which have been treated as sales for
reporting purposes. Includes options to acquire 5,927 shares of Class A
Common Stock exercisable currently or within 60 days.
(3) Executive officer and/or Director and/or nominee for Director of the
Company. Mailing address is c/o The Boston Beer Company, Inc., 75
Arlington Street, Boston, MA 02116.
(4) Includes options to acquire 389,148 shares of Class A Common Stock
exercisable currently or within 60 days.
(5) Includes options to acquire 5,500 shares of Class A Common Stock
exercisable currently or within 60 days.
(6) Consists of options to acquire 11,647 shares of Class A Common Stock
exercisable currently or within 60 days.
(7) Director of the Company. Consists of (i) options to acquire 10,000 shares
of Class A Common Stock exercisable currently or within 60 days; (ii)
61,630 shares of Class A Common Stock owned outright; and (iii) 2,293
shares of Class A Common Stock owned by a profit sharing plan of which
Mr. Cummin is trustee. Mailing address is Three Pickwick Plaza,
Greenwich, Connecticut 06830.
(8) Director of the Company. Shares are owned of record by Kautz Family
Partners, L.P. of which Mr. Kautz is general partner. Includes options to
acquire 10,000 shares of Class A Common Stock exercisable currently or
within 60 days.
4
<PAGE>
(9) Director of the Company and father of C. James Koch. Includes options to
acquire 10,000 shares of Class A Common Stock exercisable currently or
within 60 days and 2,000 shares owned by the spouse of Mr. Charles Joseph
Koch.
(10) Director of the Company. Includes options to acquire 10,000 shares of
Class A Common Stock exercisable currently or within 60 days. Mailing
address is c/o The Wing Group, 1610 Woodstead Court, Suite 200, The
Woodlands, Texas 77380.
(11) Includes options to acquire 5,000 shares of Class A Common Stock
exercisable currently or within 60 days and 1,000 shares of Class A
Common Stock owned by the spouse of Mr. Hiatt.
DIRECTOR COMPENSATION FOR THE LAST FISCAL YEAR
Except as described in the following paragraph, the Company's Directors are
not compensated for their services as such, although they are on occasion
reimbursed for out-of-pocket expenses incurred in attending meetings.
On May 21, 1996, the Company adopted a Non-Employee Director Stock Option
Plan pursuant to which each non-employee director of the Company receives the
grant of 2,500 shares of the Company's Class A Common Stock annually as of the
date of the Annual Stockholders' Meeting of the Company. The grant price for
such options is based upon the fair market value of the Company's stock as of
the date of grant. On May 21, 1996, each non-employee director was granted an
option to purchase up to 2,500 shares at a per share price of $18.5625 per
share; on June 3, 1997, each non-employee director was granted an option to
purchase up to 2,500 shares of the Company's stock at $9.50 per share; on June
1, 1998, each non-employee director was granted an option to purchase up to
2,500 shares at a per share price of $11.1875; and on June 1, 1999, each non-
employee director was granted an option to purchase up to 2,500 shares at a
per share price of $8.125. The grant of stock options under this Non-Employee
Director Stock Option Plan is subject to the requirement that each director
comply with his fiduciary obligations with the Company. If any breach of such
obligations should occur, the Company shall be entitled, in addition to any
other remedies available to it, to recover all profit realized by him as a
result of the exercise of such option during the last 12 months of his term as
director and at any time after the expiration of such term. On December 19,
1997, the Board amended the terms of such Non-Employee Director Stock Option
Plan (and of each stock option grant made pursuant to the terms of such Plan)
to increase from ninety (90) days to three (3) years the period within which
each option would remain exercisable following the date on which the optionee
ceased to be a Director of the Company, subject in any case to the ten (10)
year term of each option.
5
<PAGE>
COMPENSATION COMMITTEE
REPORT ON EXECUTIVE COMPENSATION
Compensation Philosophy. The Company's executive compensation system
continues to be comprised of base salaries, annual bonuses and stock option
awards. Executive compensation is subject to the oversight and approval of the
Compensation Committee of the Board of Directors (the "Committee"), which
reviews executive officer compensation annually. Executive compensation is
designed to be competitive within the alcoholic beverages industry and other
companies of comparable size and complexity, so as to enable the Company to
continue to attract and retain talented and motivated individuals in key
positions.
Compensation paid to the Company's executive officers is intended to reflect
the responsibility associated with each executive officer's position, the past
performance of the specific executive officer, the goals of management and the
profitability of the Company. Compensation in any particular case may vary
from any industry average on the basis of annual and long-term Company
performance, as well as individual performance. The Compensation Committee
will exercise its discretion to set compensation where, in its judgment,
external or individual circumstances warrant it.
Equity-Based Compensation. During 1999, the Compensation Committee again
devoted significant attention to the grant of so-called Discretionary Options
under the Company's Employee Equity Incentive Plan. The Discretionary Options
feature of the Employee Equity Incentive Plan has been used by the
Compensation Committee as an integral part of the overall compensation
approach for the officers of the Company. Such stock option awards are
designed to provide incentive to the Company's key management employees to
increase the market value of the Company's stock, thus linking corporate
performance and stockholder value to executive compensation.
As amended and restated in 1997, the Employee Equity Incentive Plan calls
for the Committee to make recommendations to the full Board with respect to
the grant of Discretionary Options. In recommending the grant of options, the
Compensation Committee takes into account the position and responsibilities of
the optionee being considered, the nature and value to the Company of his or
her service and accomplishments, his or her present and potential
contributions to the success of the Company and such other factors as the
Compensation Committee deems relevant. In carrying out these responsibilities
in 1999, the Committee met with the Company's Chief Executive Officer in
October to review Management's preliminary thinking with respect to
Discretionary Options to be granted effective January 1, 2000. The Committee
met again with the Chief Executive Officer in December to review final
recommendations in the context of the overall compensation plan for
executives. Based on this review, the Committee recommended that options
covering an aggregate of 275,000 shares of Class A Common Stock be granted by
the Board, effective as of January 1, 2000. The Committee also recommended,
and the Board approved, that a portion of the options granted to the Company's
two most senior executives carry exercise prices representing a premium over
the current market price for the Company's Class A Common Stock.
Up to an aggregate of 2,687,500 shares of Class A Common Stock may be issued
under the Employee Equity Incentive Plan. As of March 31, 2000, there were
approximately 600,000 shares of Class A Common Stock available for grant under
the Employee Equity Incentive Plan.
A detailed description of the Employee Equity Incentive Plan is included
elsewhere in this Proxy Statement. The Employee Equity Incentive Plan may be
amended or terminated by the Board of Directors, subject to the approval of
the holders of a majority in interest of the Class B Common Stock of the
Company.
Chief Executive Officer Compensation. The Compensation Committee reviewed
and approved the compensation paid to the Company's Chief Executive Officer,
C. James Koch, during 1999. In reviewing such compensation, the Committee
evaluated the Company's success in executing against the Company's strategic
plan for maintaining its leading position in the highly competitive craft beer
industry. The Compensation Committee believes that the compensation paid to
Mr. Koch in 1999 was reasonable in light of the Company's
6
<PAGE>
overall performance, especially in the area of profitability. The Committee
also now believes that, even though Mr. Koch already has a significant equity
position in the Company, his compensation should also be aligned with the
interests of all stockholders. Accordingly, the Compensation Committee
recommended, and the Board approved, the grant to Mr. Koch of a Discretionary
Option covering 30,000 shares, effective January 1, 2000, of which 6,000
shares carry an exercise price of $7.15625; 7,500 shares carry an exercise
price of $9.5178; 7,500 shares carry an exercise price of $11.9509; and 9,000
shares carry an exercise price of $14.3125.
The Compensation Committee:
James C. Kautz, Chairman
Pearson C. Cummin, III
Robert N. Hiatt
John B. Wing
7
<PAGE>
EXECUTIVE OFFICERS OF THE COMPANY
Information required by Item 7(b) of Schedule 14A with respect to executive
officers of the Corporation is set forth below. The executive officers of the
Corporation are elected annually by the Board of Directors and hold office
until their successors are elected and qualified, or until their earlier
removal or resignation.
C. James Koch, 50, co-founded the Company in 1984 and has been the Chief
Executive Officer throughout the Company's history.
Martin F. Roper, 37, was appointed President of the Corporation in December,
1999, after having served as its Chief Operating Officer since April, 1997. He
joined the Company as Vice President--Operations in September 1994 from Steel
Works Inc. where he was President of the MEG Division. From July 1990 to
October 1992, Mr. Roper was Executive Vice President of Blocksom & Co.
Richard P. Lindsay, 38, serves as Chief Financial Officer of the
Corporation. Mr. Lindsay joined the Company in early 1997 to assist in the
acquisition and integration of the Company's Cincinnati brewery. Immediately
following the acquisition, Mr. Lindsay served as Corporate Controller until he
was appointed Vice President--Finance in November 1998 and assumed his current
position in October 1999. Prior to joining the Company, Mr. Lindsay held
various finance and consulting positions at Agility, Inc., KPMG Peat Marwick
LLP and Shawmut Bank.
Jeffrey White, 42, is Vice President of Operations. Mr. White has served in
his current position since April 1997. He had served as Director of Operations
of the Company from 1994 to 1997, Operations Manager from 1991 to 1994, and as
Distribution Manager from 1989 to 1991. Mr. White worked for Anheuser-Busch
from 1988 to 1989 as a Packaging Supervisor and prior to that, for New
Amsterdam Brewing Company as Operations Manager.
David Grinnell, 41, has been Manager of Brewing Operations of the Company
since 1988.
EXECUTIVE COMPENSATION
The following table sets forth all compensation awarded to, earned by or
paid to the Corporation's Chief Executive Officer and each of the
Corporation's executive officers (other than the Chief Executive Officer)
whose total annual salary and bonus exceeded $100,000 for all services
rendered in all capacities to the Company for the Company's three most recent
fiscal years ended December 25, 1999, December 26, 1998, and December 27,
1997.
8
<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Other
Compensation(1) Compensation
Name and Principal ----------------- Other Annual from
Position Year Salary Bonus(2) Compensation Securities
------------------ ---- -------- -------- ------------ ------------
<S> <C> <C> <C> <C> <C>
C. James Koch................. 1999 $184,465 -- $976 $ 2,072
Chairman and Chief 1998 $184,465 -- $745 --
Executive Officer 1997 $184,465 $36,750 $185 --
Martin F. Roper............... 1999 $324,461 $45,000 $168 --
President and Chief 1998 $281,511 $40,000 $539 --
Operating Officer 1997 $213,302 $ 500 $209 --
Richard P. Lindsay............ 1999 $128,017 $11,500 $ 84 --
Chief Financial Officer 1998 $102,898 $15,000 $ 50 --
and Treasurer 1997 $ 63,452 $ 6,500 $ 24 --
Jeffrey D. White.............. 1999 $109,339 $13,000 $ 89 $ 5,471
Vice President of Operations 1998 $105,651 $11,640 $ 58 $12,500
1997 $ 93,264 $ 500 $ 88 $22,084
</TABLE>
- --------
(1) Included in this column are amounts earned, though not necessarily
received, during the corresponding fiscal year.
(2) The bonus amounts for the executive officers have been restated so that
the bonus for all fiscal year periods is recorded for each officer in the
year in which such bonus is paid.
The following sets forth, as of December 25, 1999, information regarding
options exercised by the Executive Officers during the fiscal year ended
December 25, 1999 as well as information regarding unexercised options held by
such Executive Officers and the value of "in-the-money" options.
AGGREGATED OPTION EXERCISES AND YEAR-END OPTION VALUES AS OF DECEMBER 25, 1999
<TABLE>
<CAPTION>
Number of Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options at Options at
FY-End (#) FY-End ($)(2)
Shares Acquired Value Realized ------------------------- -------------------------
Name on Exercise (#) ($)(1) Exercisable Unexercisable Exercisable Unexercisable
---- --------------- -------------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
C. James Koch........... 0 0 2,927 15,000 $21,001 0
Martin F. Roper......... 0 0 321,148 223,735 0 0
Richard P. Lindsay...... 0 0 1,250 18,750 0 0
Jeffrey D. White........ 654 $5,471 4,999 20,435 0 $3,114
David Grinnell.......... 0 0 17,055 25,381 $14,745 $2,734
</TABLE>
- --------
(1) Excludes value realized from the vesting of Investment Shares purchased in
prior year periods.
(2) Based upon a fair market value at December 25, 1999 of $7.185 per share,
determined in accordance with the rules of the Securities and Exchange
Commission, less the option exercise price or purchase price.
Employment Agreements
The Company has not entered into employment agreements with any of its
employees. However, the Stockholder Rights Agreement between the Company and
initial stockholders of the Company provides that so long as Mr. Koch remains
an employee of the Company (i) he will devote such time and effort, as a full-
time, forty (40) hours per week occupation, as may be reasonably necessary for
the proper performance of his duties and to satisfy the business needs of the
Company, (ii) the Company will provide Mr. Koch benefits no less favorable
than those formerly provided to him by the Partnership and (iii) the Company
will purchase and maintain in effect term life insurance on the life of Mr.
Koch.
9
<PAGE>
The Employee Equity Incentive Plan
The Employee Equity Incentive Plan is the successor to the Partnership's
1995 Management Option Plan, the various Partnership employee investment unit
plans, and various discretionary options granted by the Partnership. The
predecessor Incentive Share Plans entitled eligible employees to certain
deferred compensation, generally payable after termination of employment and
calculated based on appreciation in the value of equity interests in the
Company from the date of an award, and (ii) a series of plans under which a
broader group of employees of the Partnership were permitted to purchase
similar deferred compensation rights.
As of March 31, 2000, there are (i) outstanding Management Options for
45,244 shares of Class A Common Stock at an exercise price of $0.01 per share,
of which options to purchase 39,536 shares are immediately exercisable; (ii)
outstanding Discretionary Options for 1,316,216 shares of Class A Common Stock
at an average exercise price of $11.32 per share of which the options to
purchase 687,147 shares are immediately exercisable; and (iii) rights to
receive 107,670 Investment Shares, of which rights to receive 49,736 shares
have vested.
A more complete discussion of the specific terms and provisions of the
Employee Equity Incentive Plan is provided below.
Stock Options
The following table sets forth certain information concerning grants of
stock options made during the year ended December 25, 1999 to the executive
officers named below:
OPTION GRANTS IN YEAR ENDED DECEMBER 25, 1999
<TABLE>
<CAPTION>
Individual Grants
------------------------------------------------------------
Potential
Number of Percent of Realizable Value at
Securities Total Exercise Assumed Annual Rates of
Underlying Options or Stock Price Appreciation
Options Granted to Base for Option Term(2)
Granted Employees in Price Expiration --------------------------
Name (#)(1) Fiscal Year Per Share Date 0% 5% 10%
---- ---------- ------------ --------- ---------- ---------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
C. James Koch........... 15,000 5.5% [See Note [See Note $ 0.00 $ 54,199 $ 119,765
3 below] 4 below]
Martin F. Roper......... 40,000 14.5% [See Note [See Note $ 0.00 $ 144,530 $ 319,373
5 below] 4 below]
Richard P. Lindsay...... 15,000 5.5% $ 8.4375 1/1/09 $ 0.00 $ 79,594 $ 201,708
Jeffrey D. White........ 15,000 5.5% $ 8.4375 1/1/09 $ 0.00 $ 79,594 $ 201,708
David Grinnell.......... 10,000 3.6% $ 8.4375 1/1/09 $ 0.00 $ 53,063 $ 134,472
</TABLE>
- --------
(1) Options vest at 20% each year. Options become immediately exercisable in
full in the event that C. James Koch and/or members of his family cease to
control a majority of the Company's issued and outstanding Class B Common
Stock.
(2) The potential realizable value of the options reported above was
calculated by assuming 0%, 5% and 10% annual rates of appreciation above
the fair market value of the Class A Common Stock of the Company from the
date of grant (determined in accordance with the rules of the Securities
and Exchange Commission) of the options until the expiration of the
options. These assumed annual rates of appreciation were used in
compliance with the rules of the Securities and Exchange Commission and
are not intended to forecast future price appreciation of the Class A
Common Stock of the Company. The actual value realized from the options
could be higher or lower than the values reported above, depending upon
the future appreciation or depreciation of the Class A Common Stock during
the option period, the option holder's continued employment through the
option period and the timing of the exercise of the options.
(3) Options for 3,000 shares carry an exercise price of $8.4375; 3,750 shares
carry an exercise price of $11.2219; 3,750 shares carry an exercise price
of $14.0906; and 4,500 shares carry an exercise price of $16.8750.
10
<PAGE>
(4) The Options terminate on the expiration of the 10-day period that
commences on the third business day after the Company files with the
Securities and Exchange Commission its Annual Report on Form 10-K for its
2003 fiscal year.
(5) Options for 8,000 shares carry an exercise price of $8.4375; 10,000 shares
carry an exercise price of $11.2219; 10,000 shares carry an exercise price
of $14.0906; and 12,000 shares carry an exercise price of $16.8750.
Other Related Transactions
Company Stock Performance
The chart set forth below shows the value of an investment of $100 on
November 21, 1995 in each of the Corporation's stock ("Boston Beer"), the
Standard & Poor's 500 Index ("S&P 500") and a peer group as of December 31,
1999.
[GRAPH]
COMPARISON OF CUMULATIVE TOTAL RETURNS*
STARTING
BASIS
November
DESCRIPTION 1995 1995 1996 1997 1998 1999
- --------------------------------------------------------------------------------
BOSTON BEER INC ($) $100.00 $118.75 $ 51.25 $ 39.06 $ 42.50 $ 35.94
S&P 500 ($) $100.00 $106.40 $130.83 $174.48 $224.34 $271.55
S&P BEVERAGES--
ALCOHOLIC ($) $100.00 $ 99.85 $119.78 $124.85 $177.46 $190.21
PEER GROUP ONLY ($) $100.00 $ 88.14 $ 28.41 $ 16.92 $ 12.72 $ 8.96
PEERS+YOUR COMPANY ($) $100.00 $110.09 $ 42.59 $ 30.07 $ 29.87 $ 24.37
NOTE: Data complete through last fiscal year.
NOTE: Corporate Performance Graph with peer group uses peer group only
performance (excludes your company).
NOTE: Peer group indices use beginning of period market capitalization
weighting.
*TOTAL RETURN BASED ON $100 INITIAL INVESTMENT & REINVESTMENT OF DIVIDENDS
THE EMPLOYEE EQUITY INCENTIVE PLAN
On November 20, 1995, the Company adopted the Employee Equity Incentive Plan
which provided for the grant of Management Options, Discretionary Options and
Investment Shares (each is described below). The maximum number of shares of
the Company's Class A Common Stock originally authorized for issuance under
the Employee Equity Incentive Plan was 1,687,500 shares. On October 20, 1997,
the Board of Directors (the "Board') and the sole holder of the Corporation's
Class B Common Stock amended the Employee Equity Incentive Plan to provide for
an additional 1,000,000 authorized shares and, on December 19, 1997, the
Company further amended the Employee Equity Incentive Plan to delete the
provision which had permitted the grant of Management Options which had been
granted at a per share exercise price of $0.01 and to provide for a shift
11
<PAGE>
from the Compensation Committee to the full Board of Directors authority to
act under the Employee Equity Incentive Plan, based on recommendations brought
to it by the Compensation Committee. Shares of Class A Common Stock which are
the subject of Management Options or Discretionary Options which lapse
unexercised or Investment Shares which do not vest and are repurchased by the
Company or which are redeemed by the Company shall again be available for
issuance under the Employee Equity Incentive Plan. The maximum number of
shares available for grants is subject to adjustment for capital changes.
In adopting the Employee Equity Incentive Plan, the Company has also
approved, subject to certain further restrictions described below, the
assumption of rights to acquire equity interests in the Company granted under
certain predecessor plans of the Partnership.
Administration, Termination and Amendment
The Employee Equity Incentive Plan is administered by the Board of Directors
(the "Board") and the sole holder of the Corporation's Class B Common Stock,
taking into account recommendations from the Compensation Committee of the
Board. The Compensation Committee consists of at least two (2) members of the
Board, none of whom shall be or at any time have been employees of the
Company. The members of the Compensation Committee are appointed by the Board
and the Board may at any time, subject to the above restrictions, appoint one
or more members of the Compensation Committee in substitution for or in
addition to the member or members then in office and may fill vacancies on the
Compensation Committee, however caused. The Board, subject to the approval of
the holders of a majority in interest of the Company's then issued and
outstanding Class B Common Stock, may modify, amend or terminate the Employee
Equity Incentive Plan at any time. Termination or amendment of the Employee
Equity Incentive Plan shall not, without the consent of any person affected
thereby, modify or in any way affect any Discretionary Options granted or
Investment Shares purchased prior to such termination or amendment.
Eligibility to Participate
Employees eligible to participate in the Employee Equity Incentive Plan
("Eligible Employees") are those employees of the Company who:
(i) have been employed by the Company for at least one (1) year; and
(ii) have entered into an Employment Agreement with the Company
containing certain terms and conditions as the Board, in its discretion,
may from time to time require. Only full-time management-level Eligible
Employees, as determined by the Compensation Committee in its sole
discretion, shall be selected by the Compensation Committee for a
recommendation to the Board to be granted Discretionary Options. In
designating Optionees for Discretionary Options, the Compensation Committee
shall take into account each prospective Optionee's level of
responsibility, performance, potential and such other considerations as the
Compensation Committee deems appropriate.
Terms and Provisions
Management Options and Discretionary Options. While Management Options
granted prior to December 31, 1997 remain outstanding, effective as of
December 19, 1997, the Employee Equity Incentive Plan no longer provides for
the grant of Management Options. Therefore, as of the date of its meeting in
October of each year, the Compensation Committee shall make its recommendation
to the Board concerning the overall total number of shares which are eligible
for option grants and such other and further details as the Compensation
Committee may deem appropriate. Immediately prior to the Board's meeting in
December of each year, the Compensation will finalize its recommendation,
taking into consideration the recommendations of management, and will
thereafter makes its final recommendation to the Board with respect to the
grant of Discretionary Options to
12
<PAGE>
selected Optionees. The terms of each Discretionary Option shall be set forth
in an Option Agreement, which shall include the following terms, conditions
and restrictions:
(i) The right to exercise a Discretionary Option shall vest over the
period of five (5) years after the Option Date at the rate of twenty
percent (20%) of the Option Shares covered thereby per year, or upon such
other vesting schedule as the Compensation Committee recommends, and the
Board shall so approve, so long as the Optionee continues to be employed by
the Company as of each vesting date, provided, however, that (i) the Board
may permit accelerated vesting in its discretion, (ii) Discretionary
Options shall become exercisable in full in the event of an Optionee's
retirement at or after reaching age 65, death or disability, and (iii) the
Compensation Committee may recommend, and the Board may so approve, tying
exercisability to compliance by an Optionee with any applicable restrictive
covenants; and
(ii) Except as recommended by the Compensation Committee, and approved by
the Board, from time to time, a Discretionary Option shall terminate on the
earlier to occur of the expiration of (i) ninety (90) days after the
Optionee ceases to be an employee of the Company and (ii) ten (10) years
after the Option Date.
Investment Shares. Eligible Employees may also become Participants in the
Employee Equity Incentive Plan and invest up to ten percent (10%) of their
most recent annual W-2 earnings in shares ("Investment Shares") of Class A
Common Stock. The number of Investment Shares which can be purchased by each
Participant will be computed by dividing 10% of the Participant's W-2 earnings
by the Investment Share Value. The "Investment Share Value" shall be the mean
between the high and the low prices at which shares of Class A Common Stock
traded on the New York Stock Exchange or on any other exchange on which such
shares may be traded, on the day next preceding the date of a Participant's
investment in Investment Shares, which ordinarily shall be effective as of
January 1 in each applicable year (based upon the market value of the shares,
determined as set forth above, as of the last trading day in December
immediately preceding such January 1) and discounted, according to the
Participant's years of service with the Company, as follows:
<TABLE>
<CAPTION>
Years of Service Discount
---------------- --------
<S> <C>
Less than 2 years.............................................. 0%
2-3 years...................................................... 20%
3-4 years...................................................... 30%
More than 4 years.............................................. 40%
</TABLE>
For each full year Investment Shares are held after issuance and the
Participant remains employed with the Company, twenty percent (20%) of such
Investment Shares will become vested. All Investment Shares which have not yet
vested shall automatically vest in the event of the termination of a
Participant's employment with the Company by reason of his or her retirement
at or after reaching age 65, death or disability. The Compensation Committee
may also accelerate vesting at any time in its discretion. All unvested
Investment Shares shall be held in escrow by an escrow agent selected by the
Compensation Committee, pursuant to a Restricted Stock Escrow Agreement.
Any Participant who is not subject to the provisions of Section 16(b) of the
Securities Exchange Act of 1934, as amended, shall have the right at any time
to cause the Company to redeem all, but not less than all, of such
Participant's Investment Shares at a price equal to the lesser of (i) the
Discounted Investment Share Value at which the Investment Shares were issued
and (ii) the fair market value of such Investment Shares, as of the date next
preceding the date on which the Investment Shares are tendered for redemption.
In the event that a Participant's employment with the Company is terminated
other than because of retirement at or after the age of 65, death or
disability, the Company has the right, but not the obligation, to redeem
within ninety (90) days after such termination any or all of the Investment
Shares previously purchased by the Participant which have not vested, at a
price, payable in cash, equal to the lesser of (i) the Discounted Investment
Share Value at which the Shares were issued and (ii) the fair market value of
such Investment Shares, as of the date next preceding the date on which the
Investment Shares are called for redemption.
13
<PAGE>
Except as otherwise specifically provided for above, no right or interest
under the Employee Equity Incentive Plan of any Eligible Employee shall be
assignable or transferable, in whole or in part, either directly or by
operation of law or otherwise, including, but not by way of limitation,
execution, levy, garnishment, attachment, pledge, bankruptcy or in any other
manner, other than by will or the laws of descent and distribution; and no
such right or interest of any Eligible Employee shall be subject to any
obligation or liability of such Eligible Employee. A Management Option or
Discretionary Option shall be null and void and without effect upon the
bankruptcy of the Optionee or upon the attempted assignment or transfer,
except as hereinabove provided, including without limitation any purported
assignment, whether voluntary or by operation of law, pledge, hypothecation or
other disposition contrary to the provisions hereof, or levy of execution,
attachment, trustee process or similar process, whether legal or equitable,
upon the option.
Recent Grants
The following summarizes the total grants of Management Options and
Discretionary Options during fiscal year 1999. Dollar values below are based
upon a fair market value of Class A Common Stock at December 25, 1999 of
$7.185 per share, determined in accordance with the rules of the Securities
and Exchange Commission, less the option exercise price. No Management Options
granted to the executive officers or employees of the Company during the year
ended December 25, 1999.
The following sets forth the details of Discretionary Options granted during
the year ended December 25, 1999:
<TABLE>
<CAPTION>
Discretionary Option Grants
-------------------------------
Dollar Number of
Name and Position Value(1) Shares
----------------- --------------- --------------
<S> <C> <C>
C. James Koch, Chairman and Chief Executive
Officer....................................... $ (88,397) 15,000
Martin F. Roper, President and Chief Operating
Officer....................................... $ (235,725) 40,000
Richard P. Lindsay, Chief Financial Officer and
Treasurer..................................... $ (18,788) 15,000
Jeffrey D. White, Vice President of
Operations.................................... $ (18,788) 15,000
David Grinnell, Manager of Brewing Operations.. $ (12,525) 10,000
Rhonda L. Kallman, Executive Vice President of
Sales & Brand Development(2).................. $ (235,725) 40,000
Alfred W. Rossow, Jr., Executive Vice President
and Chief Financial Officer(3)................ $ (58,931) 10,000
Roberta A. Merkel, Vice President of Brand
Development(4)................................ $ (62,625) 50,000
All Directors (excluding Executive Officers)... $ (11,750) 12,500
Employees as a Group (excluding Executive
Officers)..................................... $ (100,200) 80,000
</TABLE>
- --------
(1) Calculated by multiplying the difference between the per share value of
Class A Common Stock on December 25, 1999 and the respective option
exercise price, and multiplying by the number of shares subject to
Discretionary Options granted.
(2) Ms. Kallman, former Executive Vice President of Sales and Brand
Development, is no longer an employee of the Company and her Options have
lapsed.
(3) Mr. Rossow, former Executive Vice President and Chief Financial Officer,
is no longer an employee of the Company and all of his Options have
lapsed.
(4) Ms. Merkel, former Vice President of Brand Development, is no longer an
employee of the Company and her Options have lapsed.
Recapitalization, Reorganizations
The Employee Equity Incentive Plan provides that in the event that the
outstanding shares of Class A Stock are changed into or exchanged for a
different number or kind of shares or other securities of the Company or of
another corporation by reason of any reorganization, merger, consolidation,
recapitalization, reclassification,
14
<PAGE>
stock split-up, combination of shares, or dividends payable in capital stock,
appropriate adjustment shall be made in the number and kind of shares which
may be issued under the Employee Equity Incentive Plan and as to which
outstanding Management Options or Discretionary Options or portions thereof
then unexercised shall be exercisable, to the end that the proportionate
interest of the Optionee shall be maintained as before the occurrence of such
event; such adjustment in outstanding Discretionary Options shall be made
without change in the total price applicable to the unexercised portion of
such Discretionary Options and with a corresponding adjustment in the exercise
price per share. The exercise price per share of Management Options shall
remain $0.01 per share.
Previously Granted Options and Investment Shares
All options granted by the Partnership prior to November 20, 1995, which
were assumed under the Employee Equity Incentive Plan on that date and became
Management Options or Discretionary Options, first became exercisable, to the
extent that the right to exercise had otherwise then vested, on March 1, 1996,
except that any such options held by Optionees subject to the provisions of
Section 16(b) of the 1934 Act did not become exercisable until May 20, 1996.
All Investment Shares purchased from the Partnership prior to November 20,
1995, which had vested prior to March 1, 1996, were issued to the applicable
Participants on that date, except that vested Investment Shares otherwise then
issuable to Participants subject to the provisions of Section 16 (b) of the
1934 Act did not become issuable until May 20, 1996.
Resale Restrictions
Notwithstanding any other provision of the Employee Equity Incentive Plan,
the Company may delay the issuance of shares covered by the exercise of a
Management Option or a Discretionary Option or any Investment Shares which
have vested (in any such case, "Shares") until one of the following conditions
shall be satisfied:
(i) Such Shares are at the time of issuance effectively registered under
applicable federal and state securities acts, as now in force or hereafter
amended; or
(ii) Counsel for the Company shall have given an opinion, which opinion
shall not be unreasonably conditioned or withheld, that the issuance of
such Shares is exempt from registration under applicable federal and state
securities acts, as now in force or hereafter amended.
Moreover, unless the Shares to be issued have been effectively registered
under the Securities Act of 1933, as amended (the "1933 Act"), the Company
shall be under no obligation to issue such Shares unless the Optionee or
Participant shall first give written representation to the Company,
satisfactory in form and scope to the Company's counsel and upon which in the
opinion of such counsel the Company may reasonably rely, that he or she is
acquiring the Shares to be issued to him or her as an investment and not with
a view to or for sale in connection with any distribution thereof in violation
of the 1933 Act. The Company shall have no obligation, contractual or
otherwise, to any Optionee or Participant to register under any federal or
state securities laws any Shares issued under the Employee Equity Incentive
Plan to such Optionee or Participant.
Notwithstanding the above, Shares acquired under the Employee Equity
Incentive Plan while a Registration Statement relating to such Shares is in
effect under the 1933 Act, by persons who are not affiliates of the Company
may be sold by such persons without registration under the 1933 Act, and
without the need to comply with Rule 144 thereunder. Public resales of shares
acquired (while a Registration Statement relating to such shares is in effect
under the 1933 Act) under the Employee Equity Incentive Plan by persons who
are affiliates of the Company will be subject to registration or compliance
with the requirements of Rule 144 under the 1933 Act, other than the holding
period requirement of paragraph (d) of that Rule. Employees who are Directors
or officers of the Company may be deemed to be affiliates of the Company.
Tax Effects of Employee Equity Incentive Plan Participation
The Employee Equity Incentive Plan described herein is not a qualified plan
under Section 401 of the Internal Revenue Code and is not subject to the
provisions of the Employee Retirement Income Security Act of 1974.
15
<PAGE>
Management and Discretionary Options. Upon the grant of a Management Option
or Discretionary Option, the Participant will not recognize ordinary income
nor will the Company be entitled to a deduction. Upon the exercise of a
Management Option or a Discretionary Option, the Participant will generally
recognize ordinary income in the amount by which the fair market value of
Class A Common Stock at the time of exercise exceeds the exercise price for
the Shares then purchased and the Company will generally be entitled to a
deduction for such amount of ordinary income recognized. Upon a subsequent
disposition of Class A Common Stock, the Participant will realize a short-term
or long-term capital gain or loss, depending upon the holding period of the
Class A Common Stock, with the basis for computing such gain or loss equal to
the fair market value of Class A Common Stock on the date of exercise.
Investment Shares. Upon the purchase of an Investment Share, the Participant
will not recognize ordinary income provided the Participant makes an election
under Section 83(b) of the Internal Revenue Code (such election is referred to
herein as a "Section 83(b) election"). If the Participant makes a Section
83(b), election then the Participant will immediately recognize ordinary
income in the amount by which the fair market value of the Investment Shares
on the date of acquisition exceeds the purchase price therefor. If the
Participant does not make a Section 83(b) election, then, upon vesting of the
Investment Shares, the Participant will recognize ordinary income in the
amount by which the fair market value of the Investment Shares then vesting,
as of the date of vesting, exceeds the purchase price therefor. The Company
will generally be allowed a deduction in an amount equal to the income
recognized by the Participant in the tax year in which such income is
recognized. Upon the disposition of Investment Shares, the Participant will
realize a short-term or long-term capital gain or loss, depending upon the
holding period of the Investment Shares, after they have vested, with the
basis for computing such gain or loss equal to the amount of ordinary income
realized on such shares plus the purchase price therefor. Participants
purchasing Investment Shares should consult their tax advisors regarding the
advisability of making a Section 83(b) election. A Section 83(b) election must
be made within thirty (30) days of the purchase of Investment Shares.
INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors has appointed Arthur Andersen, L.L.P. as independent
auditors to examine the consolidated financial statements of the Company for
the fiscal year ending December 25, 1999. A representative of Arthur Andersen,
L.L.P. is expected to be present at the meeting and will have the opportunity
to make a statement if he or she so desires and to respond to appropriate
questions. The engagement of Arthur Andersen, L.L.P. was approved by the Board
of Directors, at the recommendation of the Audit Committee of the Board of
Directors, and by the sole holder of the Corporation's Class B Common Stock.
COMPLIANCE WITH SECTION 16(a) OF
THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's officers and Directors and persons owning more than 10% of the
outstanding Class A Common Stock of the Corporation to file reports of
ownership and changes in ownership with the Securities and Exchange
Commission. Officers, Directors and greater than 10% holders of Class A Common
Stock are required by SEC regulation to furnish the Corporation with copies of
all Section 16(a) forms they file.
Based solely on copies of such forms furnished as provided above, the
Company believes that during the fiscal year ended December 25, 1999, all
Section 16(a) filing requirements applicable to its officers, Directors and
owners of greater than 10% of its Class A Common Stock were complied with,
except that, through inadvertence, one report relating to two transactions by
Charles Joseph Koch was not reported on a timely basis.
16
<PAGE>
DEADLINES FOR SUBMISSION OF STOCKHOLDER PROPOSALS
Under regulations adopted by the Securities and Exchange Commission, any
proposal submitted for inclusion in the Corporation's Proxy Statement relating
to the Annual Meeting of Stockholders to be held in 2001 must be received at
the Corporation's principal executive offices in Boston, Massachusetts on or
before December 17, 2000. Receipt by the Corporation of any such proposal from
a qualified stockholder in a timely manner will not ensure its inclusion in
the proxy material because there are other requirements in the proxy rules for
such inclusion.
OTHER MATTERS
Management knows of no matters which may properly be and are likely to be
brought before the meeting other than the matters discussed herein. However,
if any other matters properly come before the meeting, the persons named in
the enclosed proxy will vote in accordance with their best judgment.
The cost of this solicitation will be borne by the Corporation. It is
expected that the solicitation will be made primarily by mail, but regular
employees or representatives of the Corporation may also solicit proxies by
telephone, telegraph and in person and arrange for brokerage houses and other
custodians, nominees and fiduciaries to send proxies and proxy material to
their principals at the expense of the Corporation.
10-K REPORT
THE CORPORATION WILL PROVIDE EACH BENEFICIAL OWNER OF ITS SECURITIES WITH A
COPY OF AN ANNUAL REPORT ON FORM 10-K, INCLUDING THE FINANCIAL STATEMENTS AND
SCHEDULES THERETO, REQUIRED TO BE FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION FOR THE CORPORATION'S MOST RECENT FISCAL YEAR, WITHOUT CHARGE, UPON
RECEIPT OF A WRITTEN REQUEST FROM SUCH PERSON. SUCH REQUEST SHOULD BE SENT TO
RICHARD P. LINDSAY, CHIEF FINANCIAL OFFICER, THE BOSTON BEER COMPANY, INC., 75
ARLINGTON STREET, BOSTON, MA 02116.
VOTING PROXIES
The Board of Directors recommends an affirmative vote for all nominees
specified herein. Proxies will be voted as specified. If signed proxies are
returned without specifying an affirmative or negative vote, the shares
represented by such proxies will be voted in favor of the nominees.
By order of the Board of Directors
C. JAMES KOCH, Clerk
Boston, Massachusetts
April 14, 2000
17
<PAGE>
THE BOSTON BEER COMPANY, INC.
PROXY - Annual Meeting of Stockholders - May 30, 2000
CLASS A COMMON STOCK
The undersigned, a stockholder of THE BOSTON BEER COMPANY, INC., does
hereby appoint C. James Koch the undersigned's proxy, with full power of
substitution, to appear and vote at the Annual Meeting of Stockholders, to be
held on May 30, 2000 at 10:00 A.M., local time, or at any adjournments thereof,
upon such matters as may come before the Meeting.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby instructs said proxy, or his substitute, to vote as
specified on the reverse side on the following matters and in accordance with
his judgment on other matters which may properly come before the Meeting.
(Continued and to be Completed on Reverse Side)
. FOLD AND DETACH HERE .
Admission Ticket
THE BOSTON BEER COMPANY, INC.
2000 ANNUAL MEETING
Tuesday, May 30, 2000
10:00 A.M.
The Brewery
30 Germania Street
Boston, MA
<PAGE>
TO VOTE IN ACCORDANCE WITH THE BOARD OF DIRECTORS' RECOMMENDATION, SIGN AND DATE
THIS CARD IN THE SPACE BELOW. NO BOXES NEED TO BE CHECKED.
Please mark
your vote as
indicated in [x]
this example
Election of Class A Directors.
FOR all nominees listed. (Except as marked to the contrary to the right.) [ ]
WITHHOLD authority for all nominees listed. [ ]
Pearson C. Cummin, III, James C. Kautz and Robert N. Hiatt
(Instructions: To withhold authority to vote for any individual nominee, write
that nominee's name in the space provided below.)
- ------------------------------------------------------------------------------
I plan to attend the meeting. [ ]
PLANNING TO ATTEND? Please help our planning efforts by letting us know if you
expect to attend the Annual Meeting. Please call (617) 368-5050, and check the
box above.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DIRECTED. IF NO DIRECTION
IS INDICATED SUCH SHARES WILL BE VOTED IN FAVOR OF SUCH ITEM.
IMPORTANT: Before returning this Proxy, please sign your name or names on the
line(s) below exactly as shown hereon. Executors, administrators, trustees,
guardians or corporate officers should indicate their full title when signing.
Where shares are registered in the name of joint tenants or trustees, each joint
tenant or trustee should sign.
Dated , 2000
------------------------------
- ------------------------------------ (L.S.)
- ------------------------------------ (L.S.)
Stockholder(s) Sign Here
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
. FOLD AND DETACH HERE .
[MAP APPEARS HERE]
DIRECTIONS TO THE BREWERY
FROM THE SOUTH OF BOSTON
Take 93N to exit 18 (Mass Ave. and Roxbury Exit). Go straight down Melnea Cass
Blvd toward Roxbury. Once on Melnea Cass Blvd you will go through seven lights.
At the eighth light take a left on Tremont St. (Landmark: Northeastern
University and Ruggles T Station will be on your right when you turn onto
Tremont St. Note: Tremont St. eventually becomes Columbus Ave.). Follow Tremont
St. through seven lights. Take a right on Amory St. (Landmark: look for a big,
powder blue Muffler Mart shop on the right - directly after Centre Street).
Follow Amory St. through 2 lights. After the 2nd light take a left on Porter St.
(Landmark: Directly after Boylston St.). Go to the end of Porter St. and the
Brewery is on the right.
FROM THE NORTH OF BOSTON
Take 93S to exit 18 (Mass Ave. and Roxbury exit) and follow the above
directions.
FROM THE SUBWAY
Take the Orange Line outbound toward Forest Hills. Exit at the Stony Brook stop.
Above ground take a left onto Boylston St. Take your first right onto Amory St.
Then take your first left onto Porter St. to Brewery gate (the Brewery will be
at the end of Porter St. on your right).
