NATIONAL BEVERAGE CORP.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities
Exchange Act of 1934 (Amendment No.
)
Filed by the Registrant
x
Filed by a Party other than the Registrant
o
Check the appropriate box:
| |
|
|
|
o Preliminary
Proxy Statement |
|
|
|
o Confidential,
for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
|
|
|
x Definitive
Proxy Statement
|
|
o Definitive
Additional Materials
|
|
o Soliciting
Material Pursuant to §240.14a-12
|
NATIONAL BEVERAGE CORP.
(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.
|
| |
| o |
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:
|
|
|
| (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:
|
|
|
| o |
Fee paid previously with preliminary materials.
|
| |
| o |
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.:
|
NATIONAL BEVERAGE CORP.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
| |
|
|
TIME:
|
|
2:00 p.m. (local time) |
DATE:
|
|
October 5, 2007 |
PLACE:
|
|
Hyatt Regency Orlando International Airport |
|
|
9300 Airport Boulevard |
|
|
Orlando, Florida 32827 |
At the Annual Meeting of Shareholders of National Beverage Corp. (the “Company”) and any
adjournments or postponements thereof (the “Meeting”), the following proposals are on the agenda
for action by the shareholders:
| |
1. |
|
To elect two directors to serve as Class II directors for a term of
three years. |
| |
| |
2. |
|
To transact such other business as may properly come before the Meeting. |
Only holders of record of common stock, par value $.01 per share, of the Company, at the close
of business on August 20, 2007 are entitled to notice of, and to vote at, the Meeting.
A complete list of the shareholders entitled to vote at the Meeting will be available for
examination by any shareholder, for any proper purpose, at the Meeting and during ordinary
business hours for a period of ten days prior to the Meeting at the principal executive offices of
the Company at One North University Drive, Fort Lauderdale, Florida 33324.
All shareholders are cordially invited to attend the Meeting in person. Admittance to the
Meeting will be limited to shareholders. Shareholders who plan to attend are requested to so
indicate by marking the appropriate space on the enclosed proxy card. Shareholders whose shares
are held in “street name” (the name of a broker, trust, bank or other nominee) should bring with
them a legal proxy, a recent brokerage statement or letter from the “street name” holder confirming
their beneficial ownership of shares.
Whether or not you plan to attend the Meeting, please complete and return the proxy in the
enclosed envelope addressed to the Company or vote electronically by using the Internet or by
telephone, since a majority of the outstanding shares entitled to vote at the Meeting must be
represented at the Meeting in order to transact business. Shareholders have the power to revoke
any such proxy at any time before it is voted at the Meeting and the giving of such proxy will not
affect your right to vote in person at the Meeting. Your vote is very important.
| |
|
|
|
|
By Order of the Board of Directors, |
|
|
|
|
|
|
|
|
Nick A. Caporella |
August
27, 2007
|
|
Chairman of the Board |
Fort Lauderdale, Florida
|
|
and Chief Executive Officer |
PROXY STATEMENT
This Proxy Statement is furnished to shareholders of National Beverage Corp., a Delaware
corporation (the “Company”) in connection with the solicitation, by order of the Board of Directors
of the Company (the “Board of Directors”), of proxies to be voted at the Annual Meeting of
Shareholders of the Company to be held at the Hyatt Regency Orlando International Airport, 9300
Airport Boulevard, Orlando, Florida 32827 on October 5, 2007, at 2:00 p.m., local time, or any
adjournment or postponement thereof (the “Meeting”). The accompanying proxy is being solicited on
behalf of the Board of Directors. The mailing address of the principal executive offices of the
Company is P.O. Box 16720, Fort Lauderdale, Florida 33318. The approximate date on which this Proxy
Statement and the accompanying form of proxy were first sent to shareholders is August , 2007.
Only holders of record of common stock, par value $.01 per share, of the Company (the “Common
Stock”) at the close of business on August 20, 2007 (the “Record Date”) are entitled to notice of,
and to vote at, the Meeting.
A shareholder who gives a proxy may revoke it at any time before it is exercised by sending a
written notice to the Corporate Secretary, at the address set forth above, by returning a later
dated signed proxy, or by attending the Meeting and voting in person. Unless the proxy is revoked,
the shares represented thereby will be voted as specified at the Meeting or any adjournment or
postponement thereof.
The Annual Report of the Company for the fiscal year ended April 28, 2007 (the “Annual
Report”) is being mailed with this Proxy Statement to all holders of record of Common Stock.
Additional copies of the Annual Report will be furnished to any shareholder upon request.
Any proposal of a shareholder intended to be presented at the Company’s 2008 Annual Meeting of
Shareholders must be received by the Company for inclusion in the Proxy Statement and form of proxy
for that meeting no later than May 1, 2008. Additionally, the Company must receive notice of any
shareholder proposal to be submitted at the 2008 Annual Meeting of Shareholders (but not required
to be included in the Proxy Statement) by July 14, 2008, or such proposal will be considered
untimely pursuant to Rule 14a-4 and 14a-5(e) under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”) and the persons named in the proxies solicited by management may exercise
discretionary voting authority with respect to such proposal.
2
SECURITY OWNERSHIP
PRINCIPAL SHAREHOLDERS
Each holder of Common Stock is entitled to one vote for each share held of record at the
close of business on the Record Date. As of such date, 45,601,634 shares of Common Stock were
outstanding. As of the Record Date, the only persons known by the Company to own of record or
beneficially more than 5% of the outstanding Common Stock were the following:
| |
|
|
|
|
|
|
|
|
| Name and Address |
|
Amount and Nature of |
|
|
| Of Beneficial Owner |
|
Beneficial Ownership |
|
Percent of Class |
|
|
|
|
|
|
|
|
|
Nick A. Caporella
One North University Drive
Fort Lauderdale, Florida 33324
|
|
34,241,529(1)
|
|
|
75.1 |
% |
|
|
|
|
|
|
|
|
|
IBS Partners Ltd.
16000 Barker’s Point Lane
Suite 155
Houston, Texas 77079
|
|
|
33,302,246 |
|
|
|
73.0 |
% |
|
|
|
| (1) |
|
Includes 33,302,246 shares owned by IBS Partners Ltd. (“IBS”).
IBS is a Texas limited partnership whose sole general partner is
IBS Management Partners, Inc., a Texas corporation. IBS
Management Partners, Inc. is owned by Mr. Nick A. Caporella. By
virtue of Rule 13d-3 promulgated under the Exchange Act, Mr.
Caporella would be deemed to beneficially own the shares of Common
Stock owned by IBS. Also includes 24,000 shares held by the wife
of Mr. Caporella as to which Mr. Caporella disclaims beneficial
ownership. |
3
MANAGEMENT
The table below reflects as of the Record Date, the number of shares of Common Stock
beneficially owned by the directors and each of the executive officers named in the Summary
Compensation Table hereinafter set forth, and the number of shares of Common Stock beneficially
owned by all directors and executive officers as a group:
| |
|
|
|
|
|
|
|
|
| |
|
Amount and Nature of |
|
|
|
|
| Name of Beneficial Owner |
|
Beneficial Ownership |
|
|
Percent of Class |
|
Nick A. Caporella |
|
|
34,241,529 |
(1) |
|
|
75.1 |
% |
Joseph G. Caporella |
|
|
350,240 |
(2) |
|
|
* |
|
Samuel C. Hathorn, Jr. |
|
|
112,944 |
(3) |
|
|
* |
|
S. Lee Kling |
|
|
272,880 |
(4) |
|
|
* |
|
Joseph P. Klock, Jr. |
|
|
4,320 |
(5) |
|
|
* |
|
Edward F. Knecht |
|
|
83,904 |
(6) |
|
|
* |
|
George R. Bracken |
|
|
114,228 |
(7) |
|
|
* |
|
Dean A. McCoy |
|
|
57,984 |
(8) |
|
|
* |
|
All executive officers and
directors as a group (8 in
number) |
|
|
35,238,029 |
(9) |
|
|
76.8 |
% |
|
|
|
| * |
|
Less than 1% |
| |
| (1) |
|
Includes 33,302,246 shares held by IBS. The sole general partner of IBS is
IBS Management Partners, Inc., a Texas corporation. IBS Management Partners,
Inc. is owned by Mr. Nick A. Caporella. Also includes 24,000 shares held by
the wife of Mr. Caporella, as to which Mr. Caporella disclaims beneficial
ownership. |
| |
| (2) |
|
Includes 53,040 shares issuable upon exercise of currently exercisable
options. Also includes 144,000 shares to be received pursuant to the exercise
of options, the delivery of which was deferred. |
| |
| (3) |
|
Includes 5,760 shares issuable upon exercise of currently exercisable options
and 384 shares held by Mr. Hathorn as custodian for his children. |
| |
| (4) |
|
Includes 10,080 shares issuable upon exercise of currently exercisable options. |
| |
| (5) |
|
Includes 720 shares issuable upon exercise of currently exercisable options. |
| |
| (6) |
|
Includes 18,144 shares issuable upon exercise of currently exercisable options. |
| |
| (7) |
|
Includes 9,108 shares issuable upon exercise of currently exercisable options.
Also includes 24,000 shares to be received pursuant to the exercise of
options, the delivery of which was deferred. |
| |
| (8) |
|
Includes 7,884 shares issuable upon exercise of currently exercisable options.
Also includes 33,600 shares to be received pursuant to the exercise of
options, the delivery of which was deferred. |
| |
| (9) |
|
Includes 104,736 shares issuable upon exercise of currently exercisable options
and 201,600 shares to be received pursuant to the exercise of options, the
delivery of which was deferred. |
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company’s executive officers, directors
and persons who own more than ten percent (10%) of a registered class of the Company’s equity
securities to file reports of ownership and changes in ownership with the Securities and Exchange
4
Commission (the “Commission”). Executive officers, directors and greater than ten percent
(10%) beneficial owners are required by regulation of the Commission to furnish the Company with
copies of all Section 16(a) forms so filed.
Based solely upon a review of the Forms 3, 4 and 5 and amendments thereto and certain
representations furnished to the Company, the Company believes that, during the fiscal year ended
April 28, 2007, its executive officers, directors and greater than ten percent (10%) beneficial
owners complied with all applicable filing requirements.
MEMBERSHIP AND MEETINGS OF THE BOARD OF DIRECTORS AND ITS COMMITTEES
Our business is managed under the direction of the Board of Directors. The Board meets during
our fiscal year to review significant developments affecting us and to act on matters requiring
Board approval.
Current Committee membership and each Committee during fiscal year ended April 28, 2007
(“Fiscal 2007”) are shown in the table below.
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Name |
|
Board |
|
|
Audit |
|
|
Compensation |
|
|
Nominating |
|
|
Strategic Planning |
|
Nick A. Caporella |
|
Chairman |
|
|
|
|
|
|
|
|
|
Member |
|
Chairman |
Joseph G. Caporella |
|
Member |
|
|
|
|
|
Member |
|
|
|
|
|
|
|
|
Samuel C. Hathorn |
|
Member |
|
Chairman |
|
Member |
|
|
|
|
|
Member |
S. Lee Kling |
|
Member |
|
Member |
|
Chairman |
|
|
|
|
|
Member |
Joseph P. Klock |
|
Member |
|
Member |
|
Member |
|
Chairman |
|
|
|
|
Cecil D. Conlee (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Member |
|
|
|
| (1) |
|
Mr. Conlee is a not an officer, director, or employee of the Company. |
INFORMATION REGARDING MEETINGS AND COMMITTEES OF THE BOARD
The Board of Directors held four meetings during Fiscal 2007. The Board of Directors has
standing Audit, Compensation and Stock Option, Nominating and Strategic Planning Committees.
The members of the Company’s Audit Committee are Messrs. Hathorn (Chairman), Kling and Klock.
During Fiscal 2007, the Audit Committee held five meetings. The principal functions of the Audit
Committee are to appoint the independent auditors of the Company and review with the independent
auditors and the Company’s internal audit department, the scope and results of audits, the internal
accounting controls of the Company, audit practices and the professional services furnished by the
independent auditors. The Company’s Board of Directors has determined that Mr. Hathorn and Mr.
Kling satisfy the requirements for an audit committee financial expert under the rules and
regulations of the Securities and Exchange Commission. The Board of Directors has concluded
5
that all three members of the Audit Committee are “independent” as defined in the listing
standards for the NASDAQ Stock Market (“NASDAQ”). None of such persons has a material business
relationship with the Company (either directly or as a partner, shareholder or member of an
organization that has a relationship with the Company).
The members of the Company’s Compensation and Stock Option Committee are Messrs. Kling
(Chairman), Klock, Hathorn and Joseph G. Caporella. During Fiscal 2007, the Compensation and Stock
Option Committee held one meeting. The principal functions of the Compensation and Stock Option
Committee are to consider, review and approve all compensation arrangements, including base salary,
annual incentive awards and stock option grants, for officers and employees of the Company and to
administer the Company’s employee benefit programs. The Compensation and Stock Option Committee
does not have a charter.
The members of the Company’s Nominating Committee are Messrs. Joseph P. Klock, Jr. (Chairman)
and Nick A. Caporella. During Fiscal 2007, the Nominating Committee held two meetings. The
Nominating Committee recommends to the Board of Directors candidates for election to the Board of
Directors. The Nominating Committee considers possible candidates from any sources, including
shareholders, for nominees for Directors. In evaluating the qualifications of nominees for the
Company’s Board of Directors, the Nominating Committee considers a variety of factors, such as
education, work experience, knowledge of the Company’s industry, membership on the Board of
Directors of other corporations and civic involvement. The Nominating Committee will consider any
nomination made by any shareholder of the Company in accordance with the procedures set forth in
the Company’s Restated Certificate of Incorporation. Under the Company’s Restated Certificate of
Incorporation, any nomination shall generally (i) be made no earlier than sixty and no more than
ninety days before the scheduled meeting by notice to the Secretary of the Company, (ii) include
certain information relevant to the shareholder and their nominee and (iii) only be made at a
meeting called for the purpose of electing directors of the Company. Recommendations, which shall
include written materials with respect to the potential candidate, should be sent to Corporate
Secretary, National Beverage Corp., P.O. Box 16720, Fort Lauderdale, Florida 33318. All
shareholder nominees for director will be considered by the Nominating Committee in the same manner
as any other nominee. All recommendations should be accompanied by a complete statement of such
person’s qualifications (including education, work experience, knowledge of the Company’s industry,
membership on the Board of Directors of another corporation, and civic activity) and an indication
of the person’s willingness to serve. The Nominating Committee does not have a charter.
The members of the Company’s Strategic Planning Committee are Messrs. Nick A. Caporella
(Chairman), Hathorn, Kling and Cecil D. Conlee. Mr. Conlee is Founding Partner of CGR Advisors and
was a former member of the Burnup and Sims, Inc. board from 1973
through March 1994. One meeting
was held during Fiscal 2007. The principal function of the Strategic Planning Committee is to
provide the Chairman and Chief Executive Officer of the Company with additional advice and
consultation on the long-term strategies of the Company.
Each director attended all of the meetings of the Board and Committees on which he serves.
Nick Caporella currently beneficially owns 75.1% of the Company’s outstanding Common Stock. As
a result, the Company is a “controlled company” within the meaning of the NASDAQ listing standards
and is not currently required to have independent directors comprise a majority of its Board
6
of Directors or to have independent directors comprise its Compensation and Stock Option
Committee or its Nominating Committee under the listing standards of NASDAQ. Notwithstanding, a
majority of both the Board of Directors of the Company and the Company’s Compensation and Stock
Option Committee are independent. Messrs Hathorn, Kling and Klock qualify as independent directors
within the meaning of the NASDAQ marketplace rules.
QUORUM AND VOTING PROCEDURE
The presence, in person or by proxy, of the holders of a majority of the outstanding shares of
Common Stock entitled to vote at the Meeting is necessary to constitute a quorum. Votes cast by
proxy or in person at the Meeting will be tabulated by the inspectors of elections appointed for
the Meeting and will be counted in determining whether or not a quorum is present. A proxy
submitted by a shareholder may indicate that all or a portion of the shares represented by such
proxy are not being voted by such shareholder with respect to a particular matter (“non-voted
shares”). This could occur, for example, when a broker is not permitted to vote shares held in
“street name” on certain matters in the absence of instructions from the beneficial owner of the
shares. Non-voted shares with respect to a particular matter will not be considered shares present
and entitled to vote on such matter, although such shares may be considered present and entitled to
vote for other purposes and will be counted for purposes of determining the presence of a quorum.
Shares voting to abstain as to a particular matter and directions to “withhold authority” to vote
for directors will not be considered non-voted shares and will be considered present and entitled
to vote with respect to such matter. Non-voted shares and abstentions will have no effect on the
matters brought to a vote at the Meeting. As a result of Mr. Caporella’s beneficial ownership of
approximately 75.1% of the outstanding shares of Common Stock of the Company, all of the proposals
will be approved by vote of shareholders at the Meeting.
MATTER TO BE CONSIDERED AT ANNUAL MEETING
ELECTION OF DIRECTORS
The Board of Directors is currently comprised of five directors elected in three classes
(the “Classes”), with two Class I directors, two Class II directors and one Class III director.
Directors in each class hold office for three-year terms. The terms of the Classes are staggered
so that the term of one Class terminates each year. The term of the current Class II directors
expires at the 2007 Meeting and when their respective successors have been duly elected and
qualified.
The Board of Directors has nominated S. Lee Kling and Joseph P. Klock, Jr. for election as
directors in Class II, each with a term of office of three years expiring at the Annual Meeting of
Shareholders to be held in 2010. In order to be elected as a director, a nominee must receive a
plurality of affirmative votes cast by the shares present or represented at a duly convened
meeting. Shareholders have no right to vote cumulatively.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE NOMINEES FOR THE
CLASS II DIRECTORS.
7
INFORMATION AS TO NOMINEES AND OTHER DIRECTORS
The following information concerning principal occupation or employment during the past five
years and age has been furnished to the Company by the nominees for the Class II directors, and by
the directors in Classes III and I whose terms expire at the Company’s Annual Meeting of
Shareholders in 2008 and 2009, respectively, and when their respective successors have been duly
elected and qualified.
NOMINEES FOR DIRECTOR
CLASS II
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
Principal Occupation |
|
Director |
|
Term |
| Name |
|
Age |
|
or Employment |
|
Since |
|
Expires |
S. Lee Kling
|
|
|
78 |
|
|
Chairman of the Board
of The Kling
Company, a merchant
banking company.
|
|
|
1993 |
|
|
|
2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Joseph P. Klock, Jr.
|
|
|
58 |
|
|
Partner of Epstein,
Becker & Green, a
law firm in Miami,
FL.
|
|
|
1987 |
|
|
|
2007 |
|
DIRECTORS WHOSE TERM OF OFFICE WILL CONTINUE AFTER THE ANNUAL MEETING
CLASS III
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
Principal Occupation |
|
Director |
|
Term |
| Name |
|
Age |
|
or Employment |
|
Since |
|
Expires |
Nick A. Caporella
|
|
|
71 |
|
|
Chairman of the
Board and Chief
Executive Officer of
National Beverage
Corp.
|
|
|
1985 |
|
|
|
2008 |
|
CLASS I
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
Principal Occupation |
|
Director |
|
Term |
| Name |
|
Age |
|
or Employment |
|
Since |
|
Expires |
Joseph G. Caporella
|
|
|
47 |
|
|
President of National
Beverage Corp.
|
|
|
1987 |
|
|
|
2009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Samuel C. Hathorn, Jr.
|
|
|
64 |
|
|
President of Trendmaker Homes,
a subsidiary of Weyerhaeuser
Company.
|
|
|
1997 |
|
|
|
2009 |
|
Additional information regarding the nominees for election as directors and the continuing
directors of the Company is as follows:
8
NOMINEES
S. Lee Kling has served as Chairman of the Board of The Kling Company, a merchant banking
company, since 2002 and prior thereto was Chairman of Kling Rechter & Company, a merchant banking
company, since 1991. Mr. Kling served as Chairman of the Board of Landmark Bancshares Corp., a bank
holding company located in St. Louis, Missouri, from 1974 through December 1991, when Landmark
merged with Magna Group, Inc. Mr. Kling also serves on the Board of Directors of Bernard Chaus,
Inc. and Electro Rent Corp.
Joseph P. Klock, Jr. has been a partner in the law firm of Epstein Becker & Green since
February 2007. From September 2005 to January 2007, he was a partner in the international law firm
of Squire, Sanders & Dempsey, L.L.P. Prior to that date he had been Chairman and Managing Partner
of Steel, Hector & Davis, a law firm located in Miami, Florida, which merged into Squire, Sanders &
Dempsey, L.L.P. in 2005.
CONTINUING DIRECTORS
Nick A. Caporella has served as Chairman of the Board and Chief Executive Officer of the
Company since the Company was founded in 1985. He also served as President until September 2002.
Mr. Caporella served as President and Chief Executive Officer (since 1976) and Chairman of the
Board (since 1979) of Burnup & Sims Inc. until March 11, 1994. Since January 1, 1992,
Mr. Caporella’s services are provided to the Company through Corporate Management Advisors, Inc.
(the “Management Company”), a company which he owns. See “Certain Relationships and Related Party
Transactions.”
Joseph G. Caporella has served as President of the Company since September 2002 and, prior to
that date, served as Executive Vice President since January 1991. He is the son of Mr. Nick A.
Caporella.
Samuel C. Hathorn, Jr. has been employed by Trendmaker Homes since 1981 and has served as
President since 1983. Trendmaker Homes is a Houston, Texas based homebuilding and land development
subsidiary of Weyerhaeuser Company.
9
EXECUTIVE COMPENSATION AND OTHER INFORMATION
COMPENSATION DISCUSSION AND ANALYSIS
The following discussion and analysis is intended to provide an understanding of the actual
compensation earned by each of our named executive officers (“Executive Officers”) from the
Company. It should be noted that neither Mr. Nick Caporella nor Mr. Bracken receive compensation directly
from the Company. The services of both are provided to the Company through a management company,
Corporate Management Advisors, Inc., an entity owned by Mr. Nick Caporella (see “Certain
Relationships and Related Party Transactions” section below).
COMPENSATION PHILOSOPHY
The objectives of the Company’s compensation program are to (1) attract, motivate, develop and
retain top quality executives who will increase long-term shareholder value and (2) deliver
competitive total compensation packages based upon the achievement of both Company and individual
performance goals. The Company expects its executives to balance the risks and related
opportunities inherent in its industry and in the performance of his or her duties and share the
upside opportunity and the downside risks once actual performance is measured.
To achieve the above goals, the Compensation and Stock Option Committee has set forth a
compensation program for its Executive Officers that is reviewed annually. It includes the
following elements:
| |
• |
|
Base annual cash salary; |
| |
| |
• |
|
Annual cash incentive bonuses; |
| |
| |
• |
|
Share-based compensation; and |
| |
| |
• |
|
Retirement, health and other benefits. |
In order to maintain a competitive compensation program for its Executive Officers, the
Compensation and Stock Option Committee, on an annual basis, performs the following: (a) reviews
compensation practices to assure fairness, relevance, support of the strategic goals of the Company
and contribution of the executive to the creation of long-term shareholder value, (b) considers the
relevant mix of compensation based upon three components, each an important factor — base salary,
annual or intermediate incentives and long-term compensation, including stock options and (c)
implements a compensation plan that reasonably allocates a portion of the executives’ total
compensation through incentives and other forms of longer-term compensation linked to Company and
individual performance and the creation of shareholder value, including stock option awards and
programs.
10
FACTORS CONSIDERED IN DETERMINING COMPENSATION
The Compensation and Stock Option Committee reviews executive compensation levels for its
Executive Officers on an annual basis to ensure that they remain competitive within the beverage
industry. The overall value of the compensation package for an Executive Officer is based upon the
achievement of certain Company and individual performance goals which are established by the
Compensation and Stock Option Committee, in consultation with the Chief Executive Officer and the
Board. Consideration is also given to comparable compensation data for individuals holding
similarly responsible positions at other peer group companies in determining appropriate
compensation levels.
With respect to long-term incentive compensation to be awarded to Executive Officers, the Company
maintains three equity based plans: (a) a 1991 Omnibus Incentive Stock Option Plan, (b) a 1995
Special Stock Option Plan and (c) a 1997 Key Employee Equity Partnership Program (each plan to be
discussed in more detail below). The timing, amount and form of awards under these plans for each
of the Executive Officers is made at the discretion of the Compensation and Stock Option Committee
based on recommendations of the Chief Executive Officer. Any such awards are granted only upon the
written approval of the Compensation and Stock Option Committee. No stock based awards or other
equity rights have ever been granted to Mr. Nick A. Caporella since the Company’s inception.
All compensation awards comply with Section 162(m) of the Internal Revenue Code. Section 162(m)
generally provides that a publicly held corporation will not be entitled to deduct for federal
income tax purposes compensation paid to either its chief executive officer or any of its four
other most highly compensated executive officers in excess of $1 million in any year if that
compensation is not performance related. The equity based plans described above were designed and
implemented in such a manner so that most awards granted thereunder will be tax deductible because
they qualify as performance-based compensation under Section 162(m) of the Internal Revenue Code.
Additionally, outstanding stock option grants under the equity based plans are performance-based
for purposes of Section 162(m). We believe all compensation paid to the Executive Officers for
fiscal year 2007, including profit sharing, is deductible under the Internal Revenue Code.
ELEMENTS OF EXECUTIVE COMPENSATION
As discussed above, the Company’s compensation programs for its Executive Officers are based
on four components: base salary, annual cash incentives, stock-based compensation and retirement,
health and other benefits; each intended as an important piece of the overall compensation.
BASE SALARY
Base salary is used to attract and retain the Executive Officers and is determined using
comparisons with industry competitors and other relevant factors including the seniority of the
individual, the functional role of the position, the level of the individual’s responsibility, and
the ability to replace the individual. Salaries for the Executive Officers are reviewed by the
Compensation and Stock Option Committee and the Chief Executive Officer, and the Board on an annual
basis. Changes to base salaries, if any, are affected primarily by individual performance. The
salaries paid to the Executive Officers during fiscal year 2007 are shown in the Summary
Compensation Table presented in this proxy statement.
11
ANNUAL INCENTIVE BONUSES
Annual incentive bonuses are intended to be and are a significant component of the Executive
Officer’s compensation package, reflecting the Company’s belief that management’s contribution to
long-term shareholder returns comes from maximizing earnings and the potential of the Company. The
amount of annual incentive compensation to be awarded to the Executive Officers (if any) is
determined by the Compensation and Stock Option Committee, upon recommendation by the Chief
Executive Officer, in its sole and absolute discretion. The Compensation and Stock Option Committee
considers certain objective and subjective factors when determining the amount of an annual
incentive bonus award for an Executive Officer, including, without limitation, the Executive’s
Officer’s performance for the fiscal year to which the bonus relates.
SHARE BASED COMPENSATION (LONG-TERM INCENTIVE PROGRAMS)
Share based long-term incentive compensation awarded to Executive Officers has been and is
provided through the issuance of stock options. Stock options are an important element of
the Company’s long-term incentives program. The primary purpose of stock options is to provide
Executive Officers and other employees with a personal and financial interest in the Company’s
success through stock ownership, thereby aligning the interests of such persons with those of our
shareholders. The Compensation and Stock Option Committee believes that the value of stock options
will reflect the Company’s financial performance over the long-term. Because the Company’s stock
option program provides for a vesting period before options may be exercised and, in general, an
exercise price at fair market value as of the date of grant, employees benefit from stock options
only when the market value of the common shares increases over time.
Stock-based awards made under the Company’s 1991 Omnibus Incentive Plan typically consist of
options to purchase Common Stock which vest over 5 years and have a term of 10 years. Certain key
executives of the Company also receive grants from time to time under the Company’s Special Stock
Option Plan. The vesting schedule and exercise price of these options are tied to the executive’s
ownership levels of Common Stock and achievement of Company objectives. Generally, the terms of the
Special Stock Options allow for the reduction in exercise price upon each vesting date of the
option. The Company issues stock awards with long-term vesting schedules to increase the level of
the executive’s stock ownership by continued employment with the Company.
In addition, share based compensation is awarded under the Company’s 1997 Key Employee Equity
Partnership Program (the “KEEP Program”). The KEEP Program is designed to positively align
interests between the Company’s executives and its shareholders beyond traditional option programs
while, at the same time, intending to stimulate and reward management in “partnering-up” with the
Company in its quest to create shareholder value. The KEEP Program provides for the granting of
stock options to key employees, officers and directors of the Company who invest their personal
funds in the Common Stock. Participants who purchase shares of the Common Stock in the open market
receive grants of stock options equal to 50% of the number of shares purchased up to a maximum of
6,000 shares in any two-year period. Options under the KEEP Program are automatically forfeited in
case of the sale of shares originally acquired by the participant. The options are granted at an
initial exercise price of 60% of the purchase price paid for the shares acquired and reduce to the
par value of the Common Stock at the end of the six-year vesting period.
12
The Company’s long-term incentive programs are generally intended to provide rewards to executives
only if value is created for shareholders over time and the executive continues in the employ of
the Company. The Compensation and Stock Option Committee believes that employees should have
sufficient holdings of the Company’s Common Stock so that their decisions will appropriately foster
growth in the value of the Company. The Compensation and Stock Option Committee reviews with the
Chief Executive Officer the recommended individual awards and evaluates the scope of
responsibility, strategic and operational goals of individual contributions in making final awards
under the 1991 Omnibus Incentive Plan, the Special Stock Option Plan and determining participants
in the KEEP Program.
Options issued pursuant to the 1995 Special Stock Option Plan and the KEEP Program after December
31, 2004 are considered deferred compensation arrangements under Section 409A on the Internal
Revenue Code of 1986. Accordingly, option recipients must make a written election to exercise
option grants on specified future dates to avoid being subject to additional income
taxes, interest and withholding. The election is irrevocable, but is subject to acceleration upon
termination of employment, disability and certain other limited circumstances. All Executive
Officers holding options granted under these plans have made such election.
With respect to the share based compensation, the Company recognizes stock compensation expense
based on the Statement of Financial Accounting Standard 123R “Share-Based Payments” (“SFAS 123R”).
The standard requires public companies to measure the cost of employee services received in
exchange for an award of equity instruments based on the grant date fair value of the award. The
Company uses the Black-Scholes option-pricing model to determine the grant date fair value.
The Company ensures that stock option awards approved by the Compensation and Stock Option
Committee will be granted subsequent to any planned release of material non-public information.
The Company does not engage in the backdating, cancellation or re-pricing of stock options and have
not engaged in such practices in the past.
RETIREMENT, HEALTH AND OTHER BENEFITS
The Company provides retirement, health and other benefits as an additional incentive to
retain employees. The Company maintains a defined contribution 401(k) plan that allows employees
to make plan contributions on a pre-tax basis, and currently contributes an additional profit
sharing contribution on behalf of each employee, the amount of which is dependent upon years of
service and compensation levels, which amount is subject to change from year to year. Although
Executive Officers are eligible to participate in the 401(k) plan, they are prevented from
participating at the same level as non-executives, due to the rules under the Internal Revenue
Code, Section 401(a)(17) which dictate the application of an annual limitation on contributions.
We currently make available to our Executive Officers and all employees a comprehensive health,
dental, life and disability insurance program. The health care insurance offers a variety of
coverage options, at the employee’s discretion. The Company currently provides a basic term life
insurance policy to all employees and makes additional coverage available at the employee’s expense
and discretion.
13
The Company does not provide any additional perquisites to the Executive Officers, other than a car
allowance (as set forth in the Summary Compensation Table below). The Company values this car
allowance benefit based upon the actual cost to the Company. The total of all perquisites to an
Executive Officer did not equal or exceed $10,000 for fiscal year 2007.
EMPLOYMENT, CHANGE IN CONTROL AND SEVERANCE AGREEMENTS
The Company does not typically enter into, and does not currently have, any formal employment,
change in control, severance or other similar agreements with any of the Executive Officers. The
Company may, from time to time, pay severance to an employee, including an Executive Officer, based
on, among other things, years of service, functional role of position
and level on individual’s responsibility and reasons for
terminating his or her services. The Company believes in trust, loyalty and commitment from both
the Company and the Executive Officers, and believes that such agreements are not necessary to
achieve its goals and meet the needs of the Executive Officers. The Company believes that the fact
that most, if not all, of the executives of the Company have been with the Company for a long
period of time demonstrates and proves this belief.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
The following table sets forth information concerning compensation awarded to, earned by
or paid to our named executive officers during Fiscal 2007, for services rendered to us during
Fiscal 2007.
14
SUMMARY COMPENSATION TABLE
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Name and |
|
|
|
|
|
|
|
|
|
|
|
|
|
Option |
|
|
All Other |
|
|
|
|
| Principal Position |
|
Year |
|
|
Salary ($) |
|
|
Bonus ($) |
|
|
Awards ($) |
|
|
Compensation ($) |
|
|
Total ($) |
|
Nick A. Caporella (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chairman of the Board
and Chief Executive Officer |
|
|
2007 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Joseph G. Caporella |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
President |
|
|
2007 |
|
|
|
375,000 |
|
|
|
289,976 |
|
|
|
— |
|
|
|
6,526 |
|
|
|
671,502 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
George R. Bracken (1)(2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior Vice President-Finance |
|
|
2007 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dean A. McCoy (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior Vice President and Chief
Accounting Officer |
|
|
2007 |
|
|
|
160,000 |
|
|
|
33,000 |
|
|
|
— |
|
|
|
6,046 |
|
|
|
199,046 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Edward F. Knecht (4) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Executive Vice President — Procurement |
|
|
2007 |
|
|
|
152,300 |
|
|
|
102,788 |
|
|
|
— |
|
|
|
946 |
|
|
|
256,034 |
|
|
|
|
| (1) |
|
The services of Messrs. Nick Caporella and Bracken are provided to the Company through the Management Company, an entity
owned by Mr. Caporella. See “Certain Relationships and Related Party Transactions”. |
| |
| (2) |
|
Mr. Bracken, who is 62 years old, has served as Senior Vice President — Finance of the Company since October 2000 and, prior
to that date, served as Vice President and Treasurer since October 1996. |
| |
| (3) |
|
Mr. McCoy, who is 50 years old, has served as Senior Vice President and Chief Accounting Officer since October 2003; Senior
Vice President — Controller of the Company from October 2000 to September 2003; and, prior to that date, served as Vice President
— Controller since July 1993. |
| |
| (4) |
|
Mr. Knecht, who is 73 years old, was elected Executive Vice President — Procurement in October 2003. Since May 1989, Mr.
Knecht has served in various capacities for Shasta Sweetener Corp., a subsidiary of the Company, including President from May
1998 to present. |
15
GRANTS OF PLAN-BASED AWARDS IN FISCAL 2007
There were no equity or non-equity incentive plan-based awards granted during Fiscal 2007 to
our named Executive Officers. The Company did not re-price any equity incentive plan based awards
during Fiscal 2007.
OUTSTANDING EQUITY AWARDS AT END OF FISCAL 2007
The following table provides information about the number of outstanding equity awards held by
our named Executive Officers at April 28, 2007. No equity awards have been granted to Nick A.
Caporella since the inception of the Company.
OUTSTANDING EQUITY AWARDS AT APRIL 28, 2007
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Option
Awards |
| |
|
Number of |
|
Number of |
|
|
|
|
| |
|
Securities |
|
Securities |
|
|
|
|
| |
|
Underlying |
|
Underlying |
|
|
|
|
| |
|
Unexercised |
|
Unexercised |
|
Option |
|
Option |
| |
|
Options |
|
Options |
|
Exercise |
|
Expiration |
| Name |
|
Exercisable (1) |
|
Unexercisable |
|
Price ($) |
|
Date |
Joseph G.
Caporella |
|
|
14,400 |
|
|
|
— |
|
|
$ |
4.11 |
|
|
|
06/21/08 |
|
|
|
|
26,400 |
|
|
|
9,600 |
|
|
$ |
1.67 |
(1) |
|
|
07/05/11 |
|
|
|
|
— |
|
|
|
42,000 |
|
|
$ |
7.48 |
(1) |
|
|
02/13/16 |
|
|
|
|
5,640 |
|
|
|
5,160 |
|
|
$ |
0.01 |
(2) |
|
|
(2 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
George R. Bracken |
|
|
8,316 |
|
|
|
84 |
|
|
$ |
1.20 |
(1) |
|
|
07/05/11 |
|
|
|
|
— |
|
|
|
4,800 |
|
|
$ |
7.48 |
(1) |
|
|
02/13/16 |
|
|
|
|
120 |
|
|
|
180 |
|
|
$ |
0.01 |
(2) |
|
|
(2 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dean A. McCoy |
|
|
6,576 |
|
|
|
4,224 |
|
|
$ |
1.94 |
(1) |
|
|
07/05/11 |
|
|
|
|
— |
|
|
|
7,200 |
|
|
$ |
7.48 |
(1) |
|
|
02/13/16 |
|
|
|
|
300 |
|
|
|
450 |
|
|
$ |
0.01 |
(2) |
|
|
(2 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Edward F. Knecht |
|
|
7,200 |
|
|
|
— |
|
|
$ |
4.11 |
|
|
|
06/22/08 |
|
|
|
|
9,288 |
|
|
|
5,112 |
|
|
$ |
1.85 |
(1) |
|
|
07/05/11 |
|
|
|
|
— |
|
|
|
6,000 |
|
|
$ |
7.48 |
(1) |
|
|
02/13/16 |
|
|
|
|
720 |
|
|
|
1,320 |
|
|
$ |
0.01 |
(2) |
|
|
(2 |
) |
|
|
|
| (1) |
|
Options granted under the Company’s Special Stock Option Plan vest over an 8 year period
in relatively equal amounts at approximately 16 month intervals. The exercise price can be reduced
and the vesting schedule can be accelerated by the optionee purchasing and maintaining ownership
of shares of Common Stock and/or the Company achieving performance objectives as determined by the
Board. Based upon the maximum required ownership of Common Stock as provided in the Stock Option
Agreement together with the Company achieving the performance targets previously established by
the Board, the option can fully vest after approximately 54 months and the exercise price can be
reduced to near the par value of the Common Stock, or $.01 per share. |
| |
| (2) |
|
Options granted under the Company’s KEEP Program. See Compensation Discussion and Analysis —
Share Based Compensation (Long Term Incentive Awards). These options vest over a six year period,
with the current expiration date for full vesting ranging from December 31, 2007 to May 11, 2010. |
16
OPTION EXERCISES AND STOCK VESTED IN FISCAL 2007
The following table shows all stock options exercised and the value realized upon exercise by
the named executive officers during Fiscal 2007. There are no stock awards outstanding.
| |
|
|
|
|
|
|
|
|
| |
|
Option Awards |
|
| |
|
Number of Shares |
|
|
Value Realized |
|
| Name |
|
Acquired on Exercise(#) |
|
|
on Exercise($) |
|
Joseph G. Caporella |
|
|
48,000 |
(1) |
|
$ |
495,600 |
|
George R. Bracken |
|
|
— |
|
|
|
— |
|
Dean A. McCoy |
|
|
— |
|
|
|
— |
|
Edward F. Knecht |
|
|
— |
|
|
|
— |
|
|
|
|
| (1) |
|
The value realized by Mr. Joseph Caporella upon exercise of his
stock options was calculated by taking the difference between the fair
market value per share of our common stock on the date of exercise
(which was $12.41) less the option exercise price ($2.08), and multiply
it by the number of shares acquired upon such exercise. |
17
EQUITY COMPENSATION PLAN INFORMATION
The following table sets forth information about the Company’s shares of Common Stock that may
be issued upon exercise of options and other stock based awards under all of the Company’s equity
compensation plans as of April 28, 2007, including the 1991 Omnibus Incentive Stock Option Plan,
the Special Stock Option Plan and the Key Employee Equity Partnership Program.
| |
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Equity Compensation Plan Information |
|
| |
|
|
|
|
|
|
|
|
|
Number of Securities |
|
| |
|
Number of Securities |
|
|
|
|
|
|
remaining available for |
|
| |
|
to be issued upon |
|
|
Weighted average exercise |
|
|
future issuance under |
|
| |
|
exercise of |
|
|
price of outstanding |
|
|
equity compensation plans |
|
| |
|
outstanding options, |
|
|
options, warrants and |
|
|
(excluding securities |
|
| Plan Category |
|
warrants and rights |
|
|
rights |
|
|
reflected in column (a)) |
|
| |
|
(a) |
|
|
(b) |
|
|
(c) |
|
Equity compensation plans approved
by shareholder |
|
|
723,240 |
|
|
$ |
4.71 |
|
|
|
3,015,672 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity compensation plans not
approved by shareholders (1) |
|
|
111,967 |
|
|
$ |
1.13 |
|
|
|
207,794 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
835,207 |
|
|
$ |
4.23 |
|
|
|
3,223,466 |
|
|
|
|
| (1) |
|
Reflects shares available for grant under the Company’s Key Employee Equity Partnership Program. |
18
DIRECTOR COMPENSATION
Officers of the Company who are also directors do not receive any fee or remuneration for
services as members of the Board of Directors or of any Committee of the Board of Directors. In
Fiscal 2007, non-management directors received a retainer fee of $20,000 per annum, a fee of $1,000
for each Board meeting attended and a fee of $750 ($1,000 in the case of a committee chairman) for
each committee meeting attended. Each non-management member of the Strategic Planning Committee
received a fee of $1,250 for each meeting attended. Set forth below is the amount paid to
non-management Directors in Fiscal 2007:
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Fees Earned of |
|
|
Option |
|
|
All Other |
|
|
|
|
| Name |
|
Paid in Cash($) |
|
|
Awards($) |
|
|
Compensation($) |
|
|
Total($) |
|
Samuel C. Hathorn |
|
$ |
29,750 |
|
|
|
— |
|
|
|
— |
|
|
$ |
29,750 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
S. Lee Kling |
|
$ |
30,250 |
|
|
|
— |
|
|
|
— |
|
|
$ |
30,250 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Joseph P. Klock, Jr. |
|
$ |
30,500 |
|
|
|
— |
|
|
|
— |
|
|
$ |
30,500 |
|
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Mr. Joseph G. Caporella is both a member of the Compensation Committee and an officer of the
Company.
REPORT OF THE AUDIT COMMITTEE
The Audit Committee of the Board of Directors has furnished the following report:
The Audit Committee oversees the Company’s financial reporting process on behalf of the Board
of Directors. The Company’s management has the primary responsibility for the financial statements
and reporting process, including the Company’s systems of internal controls. In fulfilling its
oversight responsibilities, the Audit Committee reviewed and discussed with management the audited
financial statements included in the Annual Report on Form 10-K for the fiscal year ended April 28,
2007. This review included a discussion of the quality and the acceptability of the accounting
principles, the reasonableness of significant judgments, and the clarity of disclosures in the
financial statements.
The Audit Committee discussed with the Company’s independent accountants, who are responsible
for expressing an opinion on the conformity of the Company’s audited financial statements with
generally accepted accounting principles, all matters required to be discussed by Statement on
Auditing Standards No. 61. In addition, the Committee discussed with the independent accountants
their independence from management and the Company, including the matters in their written
disclosures required by the Independence Standards Board Standard No. 1.
The Audit Committee discussed with the Company’s Director of Internal Audit and independent
accountants the overall plans for their respective audits, the results of their examinations, their
evaluations of the Company’s internal controls and the overall quality of the Company’s financial
reporting.
19
In reliance on the reviews and discussions referred to above, the Audit Committee recommended
to the Board of Directors (and the Board has approved) that the audited financial statements be
included in the Company’s Annual Report on Form 10-K for the fiscal year ended April 28, 2007 for
filing with the Securities and Exchange Commission.
Samuel C. Hathorn, Jr. — Chairman
S. Lee Kling
Joseph P. Klock, Jr.
20
INDEPENDENT AUDITORS
The Company’s financial statements for the Fiscal 2007 were examined by McGladrey & Pullen
LLP, independent registered certified public accountants. Representatives of McGladrey & Pullen
LLP are expected to be present at the Meeting to make a statement if they so desire and they are
expected to be available to respond to appropriate questions. The Company’s Board of Directors
intends to review the appointment of independent certified public accountants during Fiscal 2008.
On September 5, 2006, the Company engaged McGladrey & Pullen LLP as the Company’s independent
registered public accounting firm, replacing PricewaterhouseCoopers LLP. The decision to change
independent registered public accounting firms was recommended by the Company’s management and
approved by the Audit Committee of the Company’s Board of Directors. The reports of
PricewaterhouseCoopers LLP on the Company’s financial statements for the fiscal years ended April
29, 2006 (“Fiscal 2006”) and April 30, 2005 (“Fiscal 2005”) did not contain an adverse opinion or a
disclaimer of opinion, and were not qualified or modified as to uncertainty, audit scope or
accounting principle. During Fiscal 2006 and Fiscal 2005 and through September 5, 2006, there were
no disagreements with PricewaterhouseCoopers LLP on any matter of accounting principles or
practices, financial statement disclosure or audit scope or procedure.
During Fiscal 2006 and Fiscal 2005 and through September 5, 2006, neither the Company nor
anyone on its behalf consulted with McGladrey & Pullen LLP regarding either: (i) the application of
accounting principles to a specified transaction, either completed or proposed; or the type of
audit opinion that might be rendered on the Company’s financial statements, and neither a written
report nor oral advice was provided to the Company by McGladrey & Pullen LLP that was an important
factor considered by the Company in reaching a decision as to any accounting, auditing or financial
reporting issue; or (ii) any matter that was either the subject of a disagreement (as defined in
Item 304(a)(1)(iv) of Regulation S-K and the related instructions) or a reportable event (as
described in Item 304(a)(1)(v) of Regulation S-K).
The
Company was billed an aggregate of $619,900 and $226,500 by its auditors for Fiscal 2007
and Fiscal 2006, respectively, as follows:
AUDIT FEES
For professional services rendered for the annual audit of the Company’s consolidated
financial statements, review of its interim financial statements included in the Company’s Form
10-Q and services that are normally provided in connection with statutory and regulatory filings,
$188,900 for Fiscal 2007 and $226,500 for Fiscal 2006.
AUDIT-RELATED FEES
For professional services rendered for fees associated with Sarbanes-Oxley Section 404
requirements, $431,000 for
Fiscal 2007 and none for Fiscal 2006.
During Fiscal 2007 and 2006, neither firm billed the Company for any tax consulting or other
products or services. The Audit Committee pre-approves all audit and permitted non-audit fees
before such service is rendered.
21
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
The Company is a party to a management agreement with Corporate Management Advisors, Inc., a
company owned by Nick A. Caporella. The management agreement originated with the need to employ
professionals at the early stages of the Company’s development, the cost of which could be shared
with others, thus allowing the Company to have a more cost-effective structure.
The management agreement states that the Management Company is to provide to the Company,
subject to the direction and supervision of the Board of Directors of the Company, (i) senior
corporate functions (including supervision of the Company’s financial, legal, executive
recruitment, internal audit and management information systems departments) as well as the services
of a Chief Executive Officer, and (ii) services in connection with acquisitions, dispositions and
financings by the Company, including identifying and profiling acquisition candidates, negotiating
and structuring potential transactions and arranging financing for any such transaction. In July
2005, in connection with providing services under the management agreement, the Management Company
became a twenty percent (20%) joint owner of an aircraft used by the Company. The Management
Company receives an annual base fee from the Company equal to one percent of the consolidated net
sales of the Company, plus incentive compensation based upon certain factors to be determined by
the Compensation and Stock Option Committee of the Board of Directors. The Company has paid
approximately $5.4 million, $5.2 million and $5.0 million for services rendered by the Management
Company for fiscal year 2007, 2006 and 2005 respectively. No incentive compensation has been
incurred or approved under the management agreement since its inception in fiscal year 1992.
PROXY SOLICITATION
The accompanying proxy is solicited by and on behalf of the Board of Directors of the Company.
Proxies may be solicited by personal interview, mail, email, telephone or facsimile. The Company
will also request banks, brokers and other custodian nominees and fiduciaries to supply proxy
material to the beneficial owners of the Company’s Common Stock of whom they have knowledge, and
the Company will reimburse them for their expense in so doing. Certain directors, officers and
other employees of the Company may solicit proxies without additional remuneration. The entire
cost of the solicitation will be borne by the Company.
CONTACTING THE BOARD OF DIRECTORS
Shareholders who wish to communicate with the Board of Directors may do so by writing to Board
of Directors, National Beverage Corp., P.O. Box 16720, Fort Lauderdale, Florida 33318. Such
communications will be reviewed by the Secretary of the Company, who shall remove communications
relating to solicitations, junk mail, or other correspondence relating to customer service issues.
All other communications shall be forwarded to the Board of Directors or specific members of the
Board, as appropriate or as requested in the shareholder communication. The Company encourages,
but does not require, that all members of the Board of Directors attend the Annual Meetings of
Shareholders of the Company and all members attended last year’s annual meeting.
22
DISCRETIONARY VOTING OF PROXIES ON OTHER MATTERS
The Board of Directors does not now intend to bring before the Meeting any matters other than
those disclosed in the Notice of Annual Meeting of Shareholders, and it does not know of any
business which persons other than the Board of Directors intend to present at the Meeting. Should
any other matter requiring a vote of the shareholders arise, the proxies in the enclosed form
confer upon the person or persons entitled to vote the shares represented by any such proxy
discretionary authority to vote the same in respect of any such other matter in accordance with
their best judgment.
Please date, sign and return the proxy at your earliest convenience in the enclosed envelope
addressed to the Company (no postage is required for mailing in the United States) or vote
electronically using the Internet or by telephone. A prompt return of your vote will be
appreciated as it will save the expense of further mailings.
By Order of the Board of Directors,
Nick A. Caporella
Chairman of the Board
and Chief Executive Officer
August 27, 2007
Fort Lauderdale, Florida
23
NATIONAL BEVERAGE CORP.
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS — OCTOBER 5, 2007
SOLICITED BY THE BOARD OF DIRECTORS OF THE COMPANY
The undersigned hereby constitutes and appoints David J. Boden and Dean A. McCoy, and each of
them, with full power of substitution, attorneys and proxies to represent and to vote all of the
shares of Common Stock which the undersigned would be entitled to vote, with all powers the
undersigned would possess if personally present, at the Annual Meeting of the Shareholders of
NATIONAL BEVERAGE CORP. to be held at the Hyatt Regency Orlando International Airport, 9300 Airport
Boulevard, Orlando, Florida 32827 on October 5, 2007 at 2:00 pm local time and at any adjournments
or postponements thereof, on all matters coming before said meeting in the manner set forth below:
(Continued to be signed on reverse side)
Address Change/Comments (Mark the corresponding box on the reverse side)
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
(MARK ONLY ONE OF THE FOLLOWING BOXES)
|
|
Please
Mark Here
for Address
Change or
Comments
SEE REVERSE SIDE |
|
o |
| |
| |
|
|
|
|
|
|
| 1. |
|
Election of two Class II Directors for a term of three years: |
|
|
|
|
|
|
|
| |
|
(Mark only one of the following boxes) |
|
|
|
|
|
|
|
|
|
VOTE FOR
|
|
VOTE WITHHELD
|
|
NOMINEE: |
|
|
the nominee
listed
|
|
for the nominee
listed |
|
|
|
|
|
|
|
|
|
|
|
o
|
|
o
|
|
S. Lee Kling |
|
|
|
|
|
|
|
|
|
o
|
|
o
|
|
Joseph P. Klock, Jr. |
| 2. |
|
In their discretion, upon any other matters which may properly come
before the meeting or any adjournments or postponements thereof. |
| |
| |
|
This proxy when properly executed will be voted in the manner
directed herein by the undersigned shareholder. If no direction is
made, this proxy will be voted FOR the election as Class II Director of
the nominees of the Board of Directors, and with discretionary authority
on all matters which may properly come before the meeting or any
adjournments or postponements thereof. |
| |
| |
|
The undersigned acknowledges receipt of the accompanying Proxy
Statement dated August 27, 2007 |
Please mark here if you plan to attend the meeting o
| |
|
|
|
|
Dated: ____________________________, 2007 |
|
|
|
|
|
|
|
|
Name of Shareholder |
|
|
|
|
|
|
|
|
Signature |
|
|
|
|
|
(When signing as attorney, trustee, executor,
administrator, guardian, corporate officer or other
representative, please give full title. If more than one
trustee, all should sign. Joint owners must each sign.) |
Vote By Internet or Telephone or Mail
24 Hours a Day, 7 Days a Week
Internet and telephone voting is available through 11:59 PM Eastern Time
the day prior to the annual meeting.
Your Internet or telephone vote authorizes the named proxies to vote your shares in the same manner
as if you marked, signed and returned your proxy card.
| |
|
|
|
|
|
|
|
|
Internet
http://www.proxyvoting.com/fiz
Use the Internet to vote your proxy.
Have your proxy card in hand
when voting .
|
|
OR
|
|
Telephone
1-866-540-5760
Use any touch-tone telephone to
vote your proxy. Have your proxy
card in hand when voting.
|
|
OR
|
|
Mail
Mark, sign and date
your proxy card and
return it in the
enclosed postage-paid
envelope. |
If you vote your proxy by Internet or by telephone,
you do NOT need to mail back your proxy card.