UNITED STATES
               SECURITIES AND EXCHANGE COMMISSION
                              Washington, D.C. 20549

                         FORM 10-K

[ X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934

               For the fiscal year ended December 28, 1996

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES AND EXCHANGE ACT OF 1934

     For the transition period from ............ to ...............
        
               Commission file number  1-14092

                 THE BOSTON BEER COMPANY, INC.
      (Exact name of Registrant as specified in its charter)

          Massachusetts                     04-3284048
      (State or other jurisdiction          (IRS Employer
     of incorporation or organization)      Identification Number)

            75 Arlington Street, Boston, Massachusetts  02116
 (Address, including zip code, of Registrant's principal executive office)

                    (617) 368-5000
    (Registrant's telephone number, including area code)

     SECURITIES REGISTERED PURSUANT TO SECTION 12 (b) OF THE ACT:   None

     SECURITIES REGISTERED PURSUANT TO SECTION 12 (g) OF THE ACT:
                    Class A Common Stock


   Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.      Yes [X]    No [ ]

   Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of the registrant's knowledge, in definitive proxy
or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K.  [  ]

   The aggregate market value of the Class A Common Stock ($.01 par value)
held by non-affiliates of the Registrant totaled $98,894,103 (based on the
closing price of the Company's Class A Common Stock on the New York Stock
Exchange on March 14, 1997). All of the Registrant's Class B Common Stock
($.01 par value) is held by an affiliate.

   As of March 14, 1997 there were 16,019,918 shares outstanding of the
Company's Class A Common Stock ($.01 par value) and 4,107,355 shares
outstanding of the Company's Class B Common Stock ($.01 par value).

               DOCUMENTS INCORPORATED BY REFERENCE

   Certain parts of the Registrant's Annual Report to Shareholders for the
fiscal year ended December 28, 1996 are incorporated by reference into
Parts I, II, and IV, of this report.

   Certain parts of the Registrant's definitive Proxy Statement for its
1997 Annual Meeting to be held on June 3, 1997 are incorporated by
reference into Part III of this report.


<PAGE>
                    THE BOSTON BEER COMPANY, INC.


                              PART 1


Item 1.        Business

General

     Boston Beer is the largest craft brewer by volume in the United States.
In fiscal 1996, the Company sold 1,213,000 barrels of beer, which it believes
to be more than the next five largest craft brewers combined.

     The Company's net sales have grown from $29.5 million in 1991 to
$191.1 million in fiscal 1996, representing a compounded annual growth rate
of 46%. The Company's net sales increased 26% in 1996 from 1995.

     In 1996, in addition to its flagship brand, Samuel Adams Boston Lager,
the Company brewed seventeen beers under the Boston Beer Company name:
Boston Ale, Lightship, Cream Stout, Honey Porter, Scotch Ale, Double Bock,
Triple Bock, Octoberfest, Winter Lager, Old Fezziwig, Cherry Wheat, Summer
Ale, Cranberry Lambic, Golden Pilsner, and three beers brewed under the
LongShot label. The Company also sells beer brewed under the Oregon
Original brand name through a separate sales organization and utilizes both
separate and shared brewing operations. The Company brews its beer under
contract at five breweries located in Pittsburgh, Pennsylvania, Lehigh
Valley, Pennsylvania, Portland, Oregon, Rochester, New York, and
Cincinnati, Ohio.  Effective March 1, 1997, the Company, through an
affiliate, Samuel Adams Brewery Company, Ltd., acquired the equipment and
other brewery-related personal property of The Schoenling Brewing Company
in Cincinnati, Ohio and leased the real estate on which the brewery is
located.  The Company intends to purchase the real estate of the Cincinnati
brewery once certain pre-conditions have been satisfied.

     Since its founding in 1984, the Company had operated as Boston Beer
Company Limited Partnership, a Massachusetts limited partnership, through
its sole partner Boston Brewing Company, Inc., a Massachusetts corporation.
Through a Recapitalization effected November 1995, The Boston Beer Company,
Inc., a Massachusetts corporation, became the parent corporation of Boston
Beer Company Limited Partnership and Boston Brewing Company, Inc. As a
result of the Recapitalization, all of the ownership interests in Boston
Beer Company Limited Partnership are owned, directly or indirectly, by The
Boston Beer Company, Inc.

     The Company's principal executive offices are located at 75 Arlington
Street, 5th Floor, Boston, Massachusetts  02116, and its telephone number
is (617) 368-5000.


Industry Background

     The Company is the largest brewer by volume in the craft-brewing/micro-
brewing segment of the U.S. brewing industry. The terms craft brewer and
micro-brewer are often used interchangeably by consumers and within the
industry to mean a small, independent brewer whose predominant product is
brewed with only traditional brewing processes and ingredients. Craft
brewers include contract brewers, small regional brewers, and brewpubs.
Craft beers are full-flavored beers brewed with higher quality hops, malted
barley, yeast, and water, and without adjuncts such as rice, corn, or
stabilizers, or with water dilution used to lighten beer for mass
production and consumption. The Company estimates that in 1996 the craft
brew segment accounted for approximately 4.7 million barrels. Over the five-
year period ended December 31, 1996, craft beer shipments have grown at a
compounded annual rate of approximately 39%, while total U.S. beer industry
shipments have remained substantially level.

     The primary cause for the rapid growth of craft-brewed beers is
consumers' rediscovery of and demand for more traditional, full-flavored
beers. Before Prohibition, the U.S. beer industry consisted of hundreds of
small breweries that brewed such full-flavored beers. Since the end of
Prohibition, U.S. brewers have shifted production to milder, lighter beers,
which use lower cost ingredients, and can be mass-produced to take
advantage of economies of scale in production and advertising. This shift
toward these mass-produced beers has coincided with extreme consolidation
in the beer industry. Today, three major brewers control over 75% of all
U.S. beer shipments.

     Per capita beer consumption in the U.S. has declined from its peak in
the early 1980's. As consumers began to drink less beer, they focused their
consumption on more flavorful or otherwise distinctive beers. Initially,
this demand was met by imported beers from Holland, Germany, Canada, and
Mexico. Beginning in the late 1980's, domestic craft brewers began selling
heavier, more full-flavored beers, usually in small, local geographic
markets, and often through their own brewpubs. When Samuel Adams Boston
Lager entered the market in 1985, only a handful of craft breweries
existed, virtually none of which distributed outside its immediate
geographical area. In response to increased consumer demand for more
flavorful beers, the number of craft-brewed beers has increased
dramatically. Currently there are more than 500 craft brewers. In addition
to the many independent brewers and contract brewers, the three major
brewers (Anheuser-Busch, Inc., Miller Brewing Co., and Coors Brewing Co.)
have all entered this fast-growing market, either through developing their
own specialty beers or by acquiring in whole or part, or forming
partnerships with existing craft brewers. It should be noted that in the
last four months of 1996, the growth of the craft beer market has slowed
materially. This slow down in growth may be accelerating in early 1997.

Business Strategy

     The Company's business strategy is to continue to lead the craft-
brewed beer market by creating and offering a wide variety of the highest
quality full-flavored beers, while increasing sales through new product
introductions and substantial trade and consumer awareness programs,
supported by a large, well trained and rapidly expanding field sales
organization. This strategy is detailed below.

   Quality Assurance

     The Company employs nine brewmasters and retains a world recognized
brewing authority as consulting brewmaster to monitor the Company's
contract brewers. Over 125 test, tastings, and evaluations are typically
required to ensure that each batch of Samuel Adams conforms to the
Company's standards. Its brewing department is supported by a quality
control lab at the Company's small brewery in Boston. In order to assure
that its customers enjoy only the freshest beer, the Company requires its
contract brewers to include a "freshness" date on its bottles of Samuel
Adams products. Boston Beer was among the first craft brewers to follow
this practice. For Samuel Adams products, the Company uses only higher
quality hops grown in Europe and in England.

   Product Innovations

     The Company is committed to developing new products in order to
introduce beer drinkers to different styles of beer and promote the Samuel
Adams product line and to remain a leading innovator in the craft beer
industry. These new products allow the Samuel Adams drinker to try new
styles of beer while remaining loyal to the Samuel Adams brand. New
products also help the Company obtain more shelf space in retail stores and
increased distributor and retailer focus on Boston Beer products. In 1996,
the Company launched a "Homebrew" line of beers, under the LongShot label,
based on selected home brewers' recipes.   Other beers were developed in
1996 under the Company's joint venture with Joseph E. Seagram & Sons, Inc.
("Seagram"). The Company continues to market its line of Oregon Originals
through the Oregon Ale and Beer Company. In 1997, the Company plans to
launch a hard cider line of beverage under the trademark, "HardCore".


   Contract Brewing

     The Company believes that its strategy of contract brewing, which
utilizes the excess capacity of other breweries, gives the Company
flexibility as well as quality and cost advantages over its competitors.
The Company carefully selects breweries with (i1) the capability of
utilizing traditional brewing methods, and (ii) first rate quality control
capabilities throughout brewing, fermentation, finishing, and packaging. By
using the current excess capacity at other breweries, the Company has
avoided potential start up problems of bringing a new brewery on line.
Furthermore, by brewing in multiple locations, the Company can reduce its
distribution costs and deliver fresher beer to its customers than other
craft brewers with broad distribution from a single brewery. While the
Company currently plans to continue its contract-brewing strategy, it has,
as discussed above, acquired an existing brewery in Cincinnati and will
also regularly evaluate the economic and quality issues involved with
acquiring other breweries, as well as continuing with its contract brewing
arrangements. It should be noted that the acquisition of the assets of the
Cincinnati brewery and the subsequent ownership of the brewery assets will
cause an erosion of the Company's consolidated gross profit margin and that
on a line of business basis, the Cincinnati operation is expected to show a
loss.

     The Company currently has contracts with five brewers, one of whom is
an affiliate of the Company, to produce its Samuel Adams lines of beers in
the U.S., each of which is described in greater detail below. The Company
believes that its current contract brewers have capacity, to which the
Company has access, to brew annually approximately one and one half times
as much of the Company's beer as the Company sold during 1996.

     The Company continues to brew its Samuel Adams Boston Lager at each of
its contract brewers but does not brew each of its other products at each
contract brewer. Therefore, at any particular time, the Company may be
relying on only one supplier for its products other than Samuel Adams
Boston Lager.

     In the event of a labor dispute, governmental action or other event
that causes any of the Company's contract breweries to be unable to produce
the Company's beer, the Company believes it would be able to increase
production at its other contract breweries so as to meet demand for its
beer. In such event, however, the Company may experience temporary
shortfalls in production and/or increased production or distribution costs,
the combination of which could have a material adverse effect on the
Company's results of operations.

       Pittsburgh Brewing Company. Pittsburgh Brewing's facilities were
used to brew approximately 45% of the Company's beer in 1995 and
approximately 22% in 1996. The Company's agreement with Pittsburgh Brewing
expires in February 1999, subject to earlier termination as described
below. The Company is charged a per unit rate for brewing, fermenting, and
packaging, as well as the cost of raw materials. Pittsburgh Brewing has the
right of first refusal for all beer requirements for the Samuel Adams
family of beers for a specified region if it has the ability to meet the
quality standards of the Company and is financially sound. Pittsburgh
Brewing is required to maintain product liability insurance coverage for
products produced for the Company and has agreed to indemnify the Company
and its affiliates for certain losses incurred in connection with the
manufacturing or packaging of its products.

     Pittsburgh Brewing was formerly owned by Pittsburgh Food & Beverage
which filed for Chapter 11 bankruptcy protection on February 24, 1995. In
November 1995, the Trustee for Pittsburgh Food & Beverage sold the assets
of Pittsburgh Brewing to Keystone Brewers, Inc. ("Keystone"), which assumed
the brewing contract with the Company. While the Company believes that
Pittsburgh Brewing, under Keystone ownership, will continue as a source of
supply for the Company, no assurance can be given that Keystone will be
able to continue the Pittsburgh operations or that it will not encounter
financial or operating difficulties, such as labor and other employee
relations problems which might disrupt its operations.

       The Stroh Brewery Company. In January 1994, the Company entered into
a brewing contract with Stroh related to the production of Samuel Adams
beer products at Stroh's Allentown (Lehigh Valley), Pennsylvania brewery
(the "Lehigh Valley Brewery"). Production from the Lehigh Valley Brewery
represented approximately 32% and 29% of the Company's total beer
production in 1996 and 1995, respectively.

     On or about June 30, 1996, Stroh acquired the Portland, Oregon brewery
from G. Heileman Brewing Company ("Heileman") the brewery in Portland,
Oregon (the "Portland Brewery") at which the Company had brewed certain of
its beers since 1989.  As part of such acquisition, Stroh assumed the
production agreement entered into between the Company and Heileman in
December, 1995 and agreed that the existing arrangements between the
Company and Heileman would remain in effect until at least June 30, 1998.
Production from the Portland Brewery has been, and is expected to continue
to be, the principal source of supply for markets west of and including
Denver, Colorado. Production from the Portland Brewery represented
approximately 25% and 23% of the Company's beer brewed in 1996 and 1995,
respectively.

     In January 1997, the Company entered into an amended brewing contract
with Stroh, which provides continuing access to the Lehigh Valley Brewery
and the Portland Brewery. At the same time, the Company and Stroh also
executed a letter agreement setting forth the terms on which the Company
may elect to make an investment to facilitate certain expansion efforts at
the Lehigh Valley Brewery. If the Company does not make the proposed
investment, the contract will expire on June 30, 1998.

     Under the amended brewing contract, Stroh has committed access to
certain minimum capacity at the Stroh facilities for the Company to brew
its Samuel Adams line of products, as well as certain seasonal products.
For such access, Stroh will charge the Company a per unit rate for
production and the Company will bear the costs of raw materials, excise
taxes, deposits for case pallets and kegs, and a case unit charge for using
bulk rather than packaged glass. The contract contains provisions relating
to the reallocation of access to specific capacity in certain events.

       The Genesee Brewing Company. In July, 1995, the Company entered into
a brewing contract with Genesee related to the production of Samuel Adams
beer products at its Rochester, New York brewery. The Company is charged a
per unit rate for the production of beer, as well as the costs of raw
materials and excise taxes that Genesee is obligated to pay. This agreement
caps the maximum number of barrels that Genesee is obligated to produce for
the Company. The Company commenced packaging of products at this brewery
during the fourth quarter of  1995. This agreement expires in July 2005.
However, Genesee has the right to terminate this agreement upon ten months
notice to the Company. The Company has the right to terminate immediately
with cause and, subject to the payment of a termination fee to Genesee,
without cause.

       The Schoenling Brewing Company.  The Company commenced brewing
arrangements with the Hudepohl-Schoenling Brewery in Cincinnati, Ohio, on a
limited basis in the fourth quarter of 1995.  In May 1996, the Company
entered into a brewing contract with Schoenling Brewing Company
("Schoenling"), which owns the Hudepohl-Schoenling Brewery, related to the
production of Samuel Adams beer products at its brewery in Cincinnati, and
obtained an option to acquire the brewery assets of the Hudepohl-Schoenling
Brewery. The contract provided that the Company pay a per unit rate for the
production of the beer, as well as the costs of raw materials and excise
taxes that Schoenling was obligated to pay, as well as certain deposit
fees.  Effective March 1, 1997, the Company acquired all of the equipment
and other brewery-related personal property from Schoenling and leased the
real estate on which the brewery is situated.  In addition, subject to the
satisfaction of certain pre-conditions, the Company has agreed to purchase
the real estate on which the brewery is located.  Schoenling produces
certain Samuel Adams beers and the Company's HardCore hard ciders.

   Strong Sales and Distribution Presence

     Boston Beer sells its products  through a dynamic sales force, which
the Company believes is the largest of any craft brewer and one of the
largest in the domestic beer industry. The Company sells its beer through
wholesale distributors, which then sell to retailers such as pubs,
restaurants, grocery chains, package stores, and other retail outlets. The
Company's sales force has a high level of product knowledge, and is trained
in the details of the brewing process. Its sales force receives selling
skills training each year from outside training experts. Sales
representatives typically carry hops, barley, and other samples to educate
wholesale and retail buyers as to the quality and taste of its beers. The
Company has developed strong relationships with its distributors and
retailers, many of which have benefited from the Company's premium pricing
strategy and rapid growth.

   Advertising and Promotion

     The Company has historically invested in advertising and promotion.
The Company uses radio advertising as well as outdoor advertising and,
opportunistically, print media. In the second half of 1996, the Company
began testing its television advertising campaign, which is now being
evaluated. The Company works closely with its distributors and customers to
develop and implement innovative promotions designed to increase consumer
awareness and sales. Its on-premise promotions, where legal, include beer
tastings and extensive use of user-friendly menu cards. Off-premise
promotions include incentive contests, periodic discounts to retailers and
other programs which often combine consumer, distributor, and retailer
elements.

Products

     The Company's product strategy is to create and offer a world class
variety of traditional beers and to promote the Samuel Adams product line.
At the end of 1996, the Company marketed twelve year-round and 6 seasonal
beers under the Samuel Adams and LongShot brand names. These beers and the
years in which they were first brewed or introduced are set forth below.
The Company's Samuel Adams Boston Lager has historically accounted for the
majority of the Company's sales.

       Beers                             Year First Brewed or Introduced

       Year-Round Beers

     Samuel Adams Boston Lager                         1984
     Samuel Adams Boston Ale                           1987
     Boston Lightship                                  1987
     Samuel Adams Cream Stout                          1993
     Samuel Adams Honey Porter                         1994
     Samuel Adams Triple Bock                          1994
     Samuel Adams Scotch Ale                           1995
     Samuel Adams Cherry Wheat                         1995
     Samuel Adams Golden Pilsner                       1996

     LongShot Black Lager                              1996
     LongShot Hazelnut                                 1996
     LongShot American Pale Ale                        1996

      Seasonal Beers

     Samuel Adams Double Bock                          1988
     Samuel Adams Octoberfest                          1989
     Samuel Adams Winter Lager                         1989
     Samuel Adams Cranberry Lambic                     1989
     Samuel Adams Old Fezziwig                         1995
     Samuel Adams Summer Ale                           1996

     The Company uses its Boston brewery to develop new types of innovative
and traditional beers and to supply draft beer for the local market.
Product development entails researching market needs and competitive
products, sample brewing, and market taste testing.

     In 1994, the Company formed the Oregon Ale and Beer Company ("Oregon
Ale and Beer") to develop and market Pacific Northwest style beers. Oregon
Ale and Beer markets its beers under the Oregon Original brand through a
sales force separate from that which sells Samuel Adams' styles. Oregon
Original ales have been brewed in Oregon at two breweries, one in Lake
Oswego and the other in Portland.

     On March 19, 1996, the Company entered into an Agreement with Seagram,
pursuant to which Seagram sells a line of beers developed jointly by it,
the Company and a third party craft brewer, under the "Devil Mountain"
name. As of December 28, 1996, the Company had spent approximately
$1,435,000 with respect to this venture. The Company expects to spend up to
an additional $750,000, principally to cover marketing expenses to aid the
introduction of these new beers and will, in return, receive royalties
commencing on the second anniversary following the date of the first
shipment of such products by Seagram. The Company will also provide certain
technical assistance. The agreement also sets forth the circumstances in
which the relationship can be terminated and the terms on which rights to
the product line will revert to the Company or may be acquired by the
Company.


   Ingredients and Packaging

     The Company has been successful to date in obtaining sufficient
quantities of the ingredients used in the production of its beers. These
ingredients include:

     Malt. The Company currently directs the purchase of the malt used in
the production of its beer to three suppliers, although it enters into
discussions from time to time with other vendors. The two-row varieties of
barley used in the Company's malt are grown in the U.S. and Canada.

     Hops. The Company currently buys principally Noble hops for its Samuel
Adams beers. Noble hops are varieties from specific growing areas usually
recognized for superior taste and aroma properties and include Hallertau-
Hallertauer, Tettnang-Hallertauer, Tettnang-Tettnauer, and Spolt-Spolter
from Germany, and Bohemian Saaz from the Czech Republic. Noble hops are
rarer and more expensive than other varieties of  hops. Traditional English
hops, East Kent Goldings and English Fuggles, are used in the Company's
ales. The Company has yet to find alternative hops which duplicate the
flavor and aroma of the Noble hops and traditional English ale hops. As a
result, the Company must purchase sufficient quantities of these Noble hops
to continue to increase production. The Company has been working with its
Bavarian hops dealers to increase acreage of the Hallertau-Hallertauer
varieties of hops. The Company stores its hops in multiple cold storage
warehouses to minimize the impact of a catastrophe at a single site.

     The Company purchases its hops from hops dealers, the largest of which
(Joh. Barth & Son) has over the past five years accounted for between 30%
and 61% of the hops purchased each year by the Company. The Company
generally enters into forward contracts to ensure its supply of a portion
of its requirements for up to five years.

     The Company's hops contracts are denominated in German marks or
English pounds, depending on the location of the supplier. Prior to late
1996, the Company has, as a practice, not hedged the foreign currency risk
associated with these contracts. Through that date, the Company's gains and
losses from exchange rate volatility have not been material. Beginning in
late 1996, the Company began to hedge some of its currency risks.

       Yeast. The Company maintains a supply of proprietary strains of
yeast that it supplies to its contract brewers. Since these yeasts would be
impossible to duplicate if destroyed, the Company maintains supplies in
several locations. In addition, the Company's contract brewers maintain a
supply of these yeasts that are reclaimed from the batches of beer brewed.
The contract brewers are obligated by their brewing contracts only to use
these yeasts to brew the Company's beers and the Company's yeasts cannot be
used without the Company's approval to brew any other beers produced at the
respective breweries.

       Packaging Materials. The Company maintains multiple competitive
sources of supply of packaging materials, such as bottles and shipping
cases. Other packaging materials, such as labels, crowns. and six-pack
carriers are currently supplied by single sources, although the Company
believes that alternative suppliers of these materials are available. In
those instances where the Company can negotiate preferential pricing, the
Company enters into limited term supply agreements with these vendors.
These materials are supplied to or resold to contract brewers depending on
the arrangement.

     To date, the Company has not experienced material difficulties in
obtaining timely delivery from its suppliers. Although the Company believes
there are alternate sources available for the ingredients and packaging
materials described above, there can be no assurance that the Company would
be able to acquire such ingredients or packaging materials from other
sources on a timely or cost effective basis in the event current suppliers
were unable to supply them on a timely basis. The loss of a supplier could,
in the short-term, adversely affect the Company's business until
alternative supply arrangements were secured.

Sales and Marketing

     The Company's products are sold to independent distributors by a large
field sales. With few exceptions, the Company's products are not the
primary brands in the distributors portfolio. Thus, the Company, in
addition to competing with other beers for a share of the consumer's
business, competes with other beers for a share of the distributor's
attention, time, and selling efforts. The Company considers its
distributors its primary customers and is focused on the relationship it
has with its distributors.

     In addition to this distributor focus, the Company has set up its
sales organization to include on-premise and retail account specialists.
This is designed to develop and strengthen relations at the chain
headquarter level, and to provide educational and promotional programs
aimed at distributors, retailers, and consumers, in each channel of
distribution.

     The Company has also historically engaged in extensive media
campaigns, primarily radio. In addition, its sales force complements these
efforts by engaging in sponsorships of cultural and community events, local
beer festivals, industry-related trade shows, and promotional events at
local establishments for sampling and awareness. All of these efforts are
designed to stimulate consumer demand by educating consumers, retailers,
and distributors, on the qualities of beer. The Company uses a wide array
of point-of-sale items (banners, neons, umbrellas, glassware, display
pieces, signs, menu stands, etc.) designed to stimulate impulse sales and
continued awareness. It should be noted that this rate of increase in sales
versus prior periods is slowing for the Company as well as for the market.

Distribution

     The Company distributes its beers in every state in the U.S., as well
as the District of Columbia and Puerto Rico. The Company distributes its
beer through a network of over 400 distributors. During 1996, the Company's
two largest distributors each accounted for approximately 6% of the
Company's net sales. No other distributors accounted for more than 3% of
the Company's net sales during 1996. In some states, the terms of the
Company's contracts with its distributors may be affected by laws that
restrict enforceability of some contract terms, especially those related to
the Company's right to terminate the services of its distributors.

     The Company also distributes its beers to Canada, Sweden, Germany,
Hong Kong and the United Kingdom, along with select Caribbean islands.
Exports, however, represented less than 1% of 1996 revenues.

     The Company typically receives orders by the tenth of a month with
respect to products to be shipped the following month. Products are shipped
within days of completion and, accordingly, there has historically not been
any significant product order backlog.



Competition

     The craft-brewed and high-end segments of the U.S. beer market are
highly competitive due to continuing product proliferation from craft
brewers and the recent introduction of specialty beers by national brewers.
Recent growth in the sales of craft-brewed beers has increased competition
and, as a result, the Company's growth rate compared to the preceding years
is declining. The Company's products also compete generally with other
alcoholic beverages, including other segments of the beer industry and low
alcohol products. The Company competes with other beer and beverage
companies not only for consumer acceptance and loyalty but also for shelf
and tap space in retail establishments and for marketing focus by the
Company's distributors and their customers, all of which also distribute
and sell other beers and alcoholic beverage products. The principal methods
of competition in the craft-brewed segment of the beer industry include
product quality and taste, brand advertising, trade and consumer
promotions, pricing, packaging, and the development of new products. The
competitive position of the Company is enhanced by its uncompromising
product quality, its development of new beer styles, innovative point of
sale materials, a large motivated sales force, tactical introduction of
seasonal beers and pricing strategies generating above-average profits to
distributors and retailers.

     The Company expects competition with craft brewers to increase as new
craft brewers emerge and existing craft brewers expand their capacity and
distribution.  While some of the smaller micro-brewers and craft brewers
have already left the marketplace due to the intense competition in the
marketplace which they were unable to withstand with their oftentimes
limited resources, new entrants into the market continue and competition,
overall, is high.  In addition, large brewers have developed or are
developing niche brands and are acquiring small brewers to compete in the
craft-brewed segment of the domestic beer market. These competitors may
have substantially greater financial resources, marketing strength, and
distribution networks than the Company.

     The Company competes directly with regional specialty brewers such as
Sierra Nevada Brewing Company, Pyramid Brewing Company,  Anchor Brewing
Company, other contract brewers such as Pete's Brewing Company,
Massachusetts Bay Brewing, foreign brewers such as Heineken, Molson,
Corona, Amstel, and Becks, and other regional craft brewers and brewpubs.
Niche beers produced by affiliates of certain major domestic brewers such
as Anheuser-Busch, Incorporated, Miller Brewing Co., and Coors Brewing Co.,
also compete with the Company's products.

     The Company believes that with the bulk of its production of beers
being produced as a contract brewer, it has competitive advantages over the
regional craft brewers because of its higher quality, greater flexibility,
and lower initial capital costs. Its use of contract brewing frees up
capital for other uses and allows the Company to brew its beer closer to
major markets around the country, providing fresher beer to customers and
affording lower transportation costs. The Company's recent purchase of a
brewery in Cincinnati where it previously contract-brewed its beers, will
continue to provide certain logistical advantages while at the same time
providing the Company with added flexibility of production through its
ownership which complements its strategy of contract brewing. The Company
also believes that its products enjoy competitive advantages over foreign
beers, including lower transportation costs, no import charges, and
superior product freshness.

Alcoholic Beverage Regulation and Taxation

     The manufacture and sale of alcoholic beverages is a highly regulated
and taxed business. The Company's operations are subject to more
restrictive regulations and increased taxation by federal, state, and local
governmental entities than are those of non-alcohol related beverage
businesses. Federal, state, and local laws and regulations govern the
production and distribution of beer. These laws and regulations govern
permitting, licensing, trade practices, labeling, advertising, marketing,
distributor relationships, and related matters. Federal, state, and local
governmental entities also levy various taxes, license fees, and other
similar charges and may require bonds to ensure compliance with applicable
laws and regulations. Failure by the Company to comply with applicable
federal, state, or local laws and regulations could result in penalties,
fees, suspension, or revocation of permits, licenses, or approvals. There
can be no assurance that other or more restrictive laws or regulations will
not be enacted in the future.

   Licenses and Permits

     The Company either purchases beer from one or more contract brewers or
produces beer itself and sells it to distributors pursuant to a federal
wholesaler's basic permit. Brewery and wholesale operations require various
federal, state, and local licenses, permits, and approvals. In addition,
some states prohibit wholesalers and/or retailers from holding an interest
in any supplier, such as the Company. Violation of such regulations can
result in the loss or revocation of existing licenses by the wholesaler,
retailer, and/or the supplier. The loss or revocation of any existing
licenses, permits, or approvals, and/or failure to obtain any additional or
new licenses, including those required as a result of the Recapitalization
in 1995, could have a material adverse effect on the ability of the Company
to conduct its business. On the federal level, brewers are required to file
with the Bureau of Alcohol, Tobacco, and Firearms ("ATF") an amended
Brewer's Notice every time there is a material change in the brewing
process or brewing equipment, change in the brewery's location, change in
the brewery's management, or a material change in the brewery's ownership.
Brewers must notify ATF within 30 days of any change in the wholesaler's
operations, change in the wholesaler's location, change in the wholesaler's
management or a material change in the wholesaler's ownership. The
Company's operations are subject to audit and inspection by ATF at any
time.

     On the state and local level, some jurisdictions merely require notice
of any material change in the operations, management, or ownership of a
permittee or licensee. Some jurisdictions require advance approvals and
require that new licenses, permits, or approvals must be applied for and
obtained in the event of a change in the management or ownership of the
permittee or licensee. State and local laws and regulations governing the
sale of beer within a particular state by an out-of-state brewer or
wholesaler vary from locale to locale.

     ATF permits and brewer's registrations can be suspended, revoked, or
otherwise adversely affected for failure to pay tax, to keep proper
accounts, to pay fees, to bond premises, to abide by federal alcoholic
beverage production and distribution regulations and to notify ATF of any
change (as described above), or if holders of 10% or more of the Company's
equity securities are found to be of questionable character. Permits,
licenses, and approvals from state regulatory agencies can be revoked for
many of the same reasons.

     Because of the many and various state and federal licensing and
permitting requirements, there is a risk that one or more regulatory
authorities could determine that the Company has not complied with
applicable licensing or permitting regulations or does not maintain the
approvals necessary for it to conduct business within their jurisdictions.
There can be no assurance that any such regulatory action would not have a
material adverse effect upon the Company or its operating results.

   Taxation

     The federal government and each of the states levy excise taxes on
alcoholic beverages, including beer. For brewers producing no more than
2,000,000 barrels of beer per calendar year, the federal excise tax is
$7.00 per barrel on the first 60,000 barrels of beer removed for
consumption or sale during a calendar year, and $18.00 per barrel for each
barrel in excess of 60,000. For brewers producing more than 2,000,000
barrels of beer in a calendar year, the federal excise tax is $18.00 per
barrel. As the brewer of record of its beers, the Company has been able to
take advantage of this reduced tax on the first 60,000 barrels of its beers
produced. Individual states also impose excise taxes on alcoholic beverages
in varying amounts, which have also been subject to change. The state
excise taxes are usually paid by the Company's distributors.

     Congress and state legislators routinely consider various proposals to
impose additional excise taxes on the production and distribution of
alcoholic beverages, including beer. Further increases in excise taxes on
beer, if enacted, could result in a general reduction of malt beverages
sales.

Trademarks

     The Company has obtained U.S Trademark Registrations for the marks
Samuel Adams Boston Lager (as well as for its design logo), Boston Ale,
Lightship, Winter Lager, and other marks. The Samuel Adams Boston Lager
mark and other Company marks are also registered or pending in various
foreign countries. The Company regards its Samuel Adams Boston Lager and
other trademarks as having substantial value and as being an important
factor in the marketing of its products. The Company is not aware of any
infringing uses that could materially affect its current business or any
prior claim to the trademarks that would prevent the Company from using
such trademarks in its business. The Company's policy is to pursue
registration of its marks whenever possible and to oppose vigorously any
infringements of its marks.

     The Company occasionally makes available its trademarks to independent
on-premise retailers of its products.

     In 1996, the Company entered into a license arrangement with Whitbread
PLC, the fourth largest brewery in the United Kingdom, pursuant to which a
new hybrid brew was developed and marketed under the trademark, "Boston
Beer".  The recipe was developed by Whitbread Beer Company, a subsidiary of
Whitbread PLC, with assistance from Boston Beer Company's brewers.  The
Company owns the trademarks for the new product and has granted Whitbread
an exclusive license to use that trademark in Great Britain and Ireland.
Boston Beer Company receives a royalty from the sale of this new beer.

     On March 19, 1996, the Company entered into a Trademark License and
Technical Assistance Agreement with Joseph E. Seagram & Sons, Inc.
("Seagram"), pursuant to which the Company licensed the "Devil Mountain"
trademarks for use by Seagram on beers which Seagram developed, with
technical assistance from the Company. The Agreement provides for stated
royalties to commence on the second anniversary following the date of the
first shipment of such products by Seagram.

     In addition, the Company has licensed its trademark, "Samuel Adams
Brew House" to certain entities for purposes of establishing Samuel Adams
Brew Houses at airport locations and elsewhere.  The Company does not
receive a royalty pursuant to these license arrangements.

Environmental Regulations and Operating Considerations

     As the owner of a brewery in Boston, Massachusetts and, effective
March 1, 1997, of a brewery in Cincinnati, Ohio, the Company's operations
are subject to a variety of extensive and changing federal, state, and
local environmental laws, regulations, and ordinances that govern
activities or operations that may have adverse effects on human health or
the environment. Such laws, regulations or ordinances may impose liability
for the cost of remediating, and for certain damages resulting from, sites
of past releases of hazardous materials. The Company believes that it
currently conducts, and in the past has conducted, its activities and
operations in substantial compliance with applicable environmental laws,
and believes that costs arising from existing environmental laws will not
have a material adverse effect on the Company's financial condition or
results of operations. There can be no assurance, however, that
environmental laws will not become more stringent in the future or that the
Company will not incur costs in the future in order to comply with such
laws.

     The Company's operations are subject to certain hazards and liability
risks faced by all brewers, such as potential contamination of ingredients
or products by bacteria or other external agents that may be wrongfully or
accidentally introduced into products or packaging. While the Company has
never experienced a contamination problem in its products, the occurrence
of such a problem could result in a costly product recall and serious
damage to the Company's reputation for product quality, as well as claims
for product liability. The Company and its contract brewers maintain
insurance which the Company believes is sufficient to cover any liability
claims which might result from a contamination problem in its products.

Employees

     The Company employs approximately 350 employees. None of the Company's
employees is represented by a labor union, except for 75 of those employees
employed at the Company's newly-acquired brewery in Cincinnati, Ohio. The
Schoenling Brewing Company, from whom the Company acquired certain brewery
assets in Cincinnati, and from whom the Company hired those employees
represented by labor unions, has enjoyed a good relationship with those
labor unions.   The Company has no reason to believe that a good working
relationship with those labor unions will not continue.  The Company has
experienced no work stoppages and believes that its employee relations are
good.


I
tem 2.        Properties

     The Company maintains its principal corporate offices and a brewery in
Boston, Massachusetts. The Company also maintains sales and administrative
offices in California, Maryland, and Oregon. The Company leases all of its
facilities, but will buy the brewery-related real estate in Cincinnati upon
satisfaction of certain pre-conditions. The Company believes that its
facilities are adequate for its current needs and that suitable additional
space will be available on commercially acceptable terms as required.


Item 3.        Legal Proceedings

     In early 1996, Boston Brewing Company, Inc. ("Boston Brewing"), an
affiliate of both Boston Beer Company Limited Partnership and The Boston
Beer Company, Inc., had an action filed against it by its distributor,
Premier Worldwide Beers PLC ("Premier"), such action having been filed in a
court in England. Premier's action contains a claim to damages for alleged
breach of a Distributorship Agreement between Boston Brewing and Premier.
The action is being vigorously defended and at present is in the discovery
stage.

     The Company is party to certain claims and litigation in the ordinary
course of business. The Company does not believe any of these proceedings
will result, individually or in the aggregate, in a material adverse effect
upon its financial condition or results of operations.


Item 4.        Submission of Matters to a Vote of  Security Holders

     There were no matters submitted to a vote of security holders during
the fourth quarter ended December 28, 1996.


<PAGE>

          PART II



Item 5.        Market for Registrant's Common Equity and Related
               Stockholder Matters

     The Company's Class A Common Stock is listed for trading on the New
York Stock Exchange. The Company's NYSE symbol is SAM. For the fiscal
periods indicated, the high and low sales price for  Boston Beer Company,
Inc. Class A Common Stock as reported on the New York Stock Exchange-
Composite Transaction Reporting System were as follows:

Fiscal 1996              High                Low

First Quarter            $24.750            $18.375
Second Quarter           $24.000            $18.250
Third Quarter            $23.750            $19.000
Fourth Quarter           $20.375            $10.000


Fiscal 1995              High                Low

First Quarter            Not applicable      Not applicable
Second Quarter           Not applicable      Not applicable
Third Quarter            Not applicable      Not applicable
Fourth Quarter           $33.00              $21.50

     There were 19,051 holders of record of the Company's Class A Common
Stock as of March 14, 1997. Included in the number of stockholders of
record are stockholders who hold shares in "nominee" or "street" name. The
closing price per share of the Company's Class A Common Stock as of March
14, 1997, as reported under the New York Stock Exchange-Composite
Transaction Reporting System, was $8.625.

     The Company's Class B Common Stock is not listed for trading. However,
each share of Class B Common Stock is convertible, at any time, at the
option of the holder thereof, into one share of Class A Common Stock.

    As of March 14, 1997, there was one holder of record of the Company's
Class B Common Stock.

         The holders of the Class A and Class B Common Stock are entitled to
dividends, on a share-for-share basis, only when and if declared by the Board
of Directors of the Company out of funds legally available for payment
thereof. The Company does not anticipate paying dividends on the Class A
and Class B Common Stock in the foreseeable future. It should be further
noted that under the terms of the Revolving Credit Agreement, the Company
is prohibited from paying dividends.

<PAGE>

<TABLE>

 Item 6.   Selected Financial Data
                           THE BOSTON BEER COMPANY, INC.
                              SELECTED FINANCIAL DATA
<CAPTION>                                                                     
                                          Year Ended
                      Dec. 28   Dec. 31   Dec. 31   Dec. 31   Dec. 31   Dec. 31
                       1996       1995      1994      1993      1992      1991
               (in thousands, except per share, per barrel and employee data)
                                                                     
Income Statement Data:                                               
<S>                <C>         <C>        <C>        <C>       <C>       <C>   
Sales              $213,879    $169,362   $128,077   $85,758   $53,343   $32,302
Less excise taxes    22,763      18,049     13,244     8,607     5,165     2,845
                   --------    --------   --------   -------   -------   -------
Net sales           191,116     151,313    114,833    77,151    48,178    29,457
Cost of Sales        95,786      73,847     52,851    35,481    22,028    13,039
                    --------    ---------  --------   -------   --------  ------
Gross Profit         95,330      77,466     61,982    41,670    26,150    16,418
Advertising, 
 promotional,                                            
 and selling
 expenses            70,131      60,461     46,503    32,669    21,075    12,105
General and 
 administrative      12,042       7,585      6,593     4,105     3,306     2,247
                   --------    --------    -------   -------   -------   -------
Total operating 
 expenses            82,173      68,046     53,096    36,774    24,381    14,352
                   --------    --------    -------   -------   -------   -------
Operating income     13,157       9,420      8,886     4,896     1,769     2,066
Other income 
 (expense), net       1,714         959        199        (2)     (124)       23
                    --------    --------    -------   --------   -------  ------
Income before 
 income taxes        14,871      10,379      9,085     4,894     1,645     2,089
Provision
 (benefit) for
 income taxes <F1>    6,486      (2,195)         -         -         -         -
                    --------    ---------   -------   --------    ------   -----
Net income           $8,385     $12,574     $9,085    $4,894    $1,645    $2,089
                    ========    =========   =======   ========    ======   =====

Income before
 income taxes                   $10,379     $9,085    $4,894    $1,645    $2,089

Pro forma
 income taxes        
 (unaudited)  <F2>        -       4,483      3,765     2,040        691      859
                    --------    --------    -------    ------   -------  ------
Pro forma net
 income          
 (unaudited) <F2>                $5,896     $5,320     $2,854      $954   $1,230
                    ========    =======     ======     ======    ======   ======
Earnings per share    $0.41
Pro forma earnings
 per share
 (unaudited) <F2>                 $0.33       $.29    
Weighted average 
 shares                          
 outstanding <F3>     20,296       17,949     18,171
                                                                     
Statistical Data:                                                    
Barrels sold           1,213          961        714      475       294      174
Net sales per barrel    $158         $158       $161     $162      $164     $169
Employees                253          196        138      110        87       69
Net sales per employee  $755         $772       $832     $701      $554     $427
                                                                     
Balance Sheet Data at
  period end:
Working capital      $47,769      $45,266     $3,996   $8,173    $6,169   $6,053
Total assets         $96,553      $76,690    $31,776  $24,054    $15,780 $11,981
Total long term debt  $1,800       $1,875     $1,950   $2,000     $2,050  $2,100
Total partners/
  stockholders'
  equity             $64,831      $54,798     $6,600   $8,854     $6,434  $5,954
Dividends                  -            -          -        -          -       -
<FN>                                                                     
<F1>  In 1995, the Company recorded a one-time tax benefit of $1,960,000 upon
      change in tax status of the entity, and a tax benefit of $235,000 for
      the period November 21, 1995 to December 31, 1995.
</FN>                                                                     
<FN>
<F2>  Reflects pro forma provisions for income taxes using statutory federal
      and state corporate income tax rates that would have been applied had
      the Company been required to file income tax returns during the
      indicated period. See Note B of notes to the consolidated financial
      statements.
</FN>                                                                     
<FN>
<F3>  Reflects weighted average number of common and common equivalent shares of
      the Class A and Class B Common Stock assumed to be outstanding during
      the respective periods. For the years ended December 31, 1995
      and December 31, 1994, shares reflect pro forma weighted average
      numbers. See Note B of notes to the consolidated financial statements.
</FN>
</TABLE>


<PAGE>

Item 7.        Management's Discussion and Analysis of Financial Condition
               and Results of Operations.

Overview

     Effective in fiscal 1996, the Company changed its fiscal year to end
on the last Saturday in December. The impact on the current year of two
fewer days of operations was not material.

     The Company's profitability has been affected principally by sales
volume, slow erosion of gross profit margin, the number of sales people
employed, and advertising expenses. As indicated in the table below under
"Quarterly Results", although the Company has historically experienced
higher sales and higher advertising expenses as a percent of sales in the
second through fourth quarters of each year compared to the first quarter
of each year, which has resulted in a higher level of profit in the first
quarter.

     The Company prices its beers at a level higher than domestic mass-
produced beers but at a level consistent with other craft beers. The
Company believes that this pricing is appropriate given the quality and
reputation of its products. The Company expects that its pricing may become
subject to downward pressure as sales volume and competition increase;
however, such expectations have not yet been realized in a material way. In
1996, the Company instituted various modest price increases which to date
have had a favorable impact on the Company's revenue per barrel.

     The Company's gross profit may be affected by the Company's product
mix. Seasonal beers tend to be more expensive to produce and the additional
expenses may not be fully offset by increased pricing. Increases in sales
of seasonal beers, therefore, may reduce the Company's gross profit per
barrel in certain quarters. Although the Company sells its products in
bottles and kegs, the annualized mix of the two has remained relatively
constant. A shift toward a higher proportion of keg sales versus bottle
sales may not have a negative impact on profit due to the fact that while
kegs generate lower revenue per barrel, there is generally a corresponding
reduction in the cost of producing keg products, with the exception of the
aforementioned seasonal beers.

     The financial statements of the Company for the periods prior to the
Recapitalization do not include a provision for income taxes. Prior to the
Recapitalization, the Company operated solely as Boston Beer Company
Limited Partnership. As a partnership, the income of the Company was
included in the income tax returns of the Partnership's partners. For
information purposes, the statements of income include a pro forma income
tax provision on taxable income for financial statement purposes using the
effective federal and state rates that would have resulted if the
Partnership had filed corporate tax returns during those periods. The
Company had historically distributed between 40% and 50% of pre-tax income
to its partners for the purpose of funding their tax obligations. Tax
payments by the Company following the Recapitalization, therefore, have not
caused a material change to the Company's cash flow or liquidity.

<PAGE>

Quarterly Results

     The Company has historically experienced, and expects to continue
experiencing quarterly fluctuations in its sales, operating, and net
income. Historically, the Company's sales tend to be lower in the first
quarter of each year. Sales tend to increase in the third and fourth
quarters, while decreasing in the month of December. The Company has also
historically expended less on advertising, promotion, and selling expenses
in the first quarter. It should be noted that sales from distributors to
retailers are increasing, but at a decreasing rate.

     Quarterly sales and quarterly spending on advertising, promotion, and
selling expenses are shown in the following table which sets forth certain
unaudited quarterly results of operations for each of the twelve quarters
ended December 28, 1996. In management's opinion, this unaudited
information includes all adjustments (consisting only of normal recurring
adjustments) necessary for a fair presentation of the information for the
quarters presented. The operating results for any quarter are not
necessarily indicative of results for any future quarters.

<TABLE>
 The following is a summary of selected unaudited quarterly financial data:
<CAPTION>
                                                           Quarters Ended
                        March 30,    June 29,    Sept. 28,    Dec. 28,   March 31,   June 30,  Sept. 30,   Dec. 31,
                           1996         1996        1996         1996       1995        1995      1995        1995
<S>                     <C>          <C>         <C>          <C>        <C>         <C>       <C>         <C>
Barrels Sold                275          343         294          301        197         245       246         273
                                                                            
Sales                   $48,276      $60,583     $51,598      $53,422    $34,498     $42,885   $44,512     $47,467
Less excise taxes         5,147        6,512       5,486        5,618      3,724       4,564     4,702       5,059
                        -------      -------     -------      -------    -------     -------   -------     -------
Net sales                43,129       54,071      46,112       47,804     30,774      38,321    39,810      42,408
Cost of sales            21,865       27,065      22,901       23,955     15,154      18,212    19,249      21,232
                        -------      -------     -------      -------    -------     -------   -------     -------
Gross profit             21,264       27,006      23,211       23,849     15,620      20,109    20,561      21,176
Advertising,                                                                
  promotional,
  and selling        
  expenses               14,029       20,340      17,118       18,644     10,814       16,358    16,483      16,806
General and
  administrative
  expenses                2,983        2,867       2,402        3,790      1,632        1,906     1,670       2,377
                        -------      -------     -------      -------     ------     --------   -------    --------
Total operating       
expenses                 17,012       23,207      19,520       22,434     12,446       18,264    18,153      19,183
                        -------      -------     -------      -------    -------     --------   -------    --------
Operating income          4,252        3,799       3,691        1,415      3,174        1,845     2,408       1,993
Other income                                                                
  expenses, net             434          370         437          473         49          (19)      804         125
                        -------      -------     -------      -------    -------     --------   -------    --------
Income before
  income taxes            4,686         4,169       4,128        1,888      3,223        1,826     3,212       2,118
Provision (benefit)
  for income taxes        2,046         1,808       1,832          800          -            -         -      (2,195)
                         ------       --------    -------      -------     -------    --------   -------    ---------
Net income               $2,640        $2,361      $2,296       $1,088     $3,223       $1,826    $3,212      $4,313
                         ======       ========    =======      =======     =======    ========   =======    =========
          
                                                                            
Pro forma data:                                                             
Income before             
  income taxes                                                             $3,223        $1,826   $3,212      $2,118
Pro forma income tax                                                        1,387           788    1,384         924
                                                                           -------    ---------   ------    ---------
Pro forma net income                                                       $1,836        $1,038   $1,828      $1,194
                         ======      =========    ========      =======    =======    =========   ======    =========
Effective tax rate        43.7%          43.4%       44.4%        42.4%      43.0%        43.2%    43.1%       43.6%

</TABLE>


<PAGE>

<TABLE>
Period to Period Comparison of Results

The following table sets forth certain items included in the Company's
consolidated statements of income as a percentage of net sales:

                        Percentage of Net Sales
                                                         
                                                         
                             Years  Ended
<CAPTION>                                                         
                           12/28/96     12/31/95    12/31/94   
<S>                         <C>          <C>         <C>        
Sales                       111.9%       111.9%      111.5%
Less Excise Taxes            11.9%        11.9%       11.5%   
                            ------       ------      ------
Net Sales                   100.0%       100.0%      100.0%
                                                         
Cost of Sales                50.1%        48.8%       46.0%   
                           ------        ------      ------
Gross Profit                 49.9%        51.2%       54.0%
                                          
Advertising,                                             
  promotional, and
  selling expense           36.7%         40.0%       40.5%   
General and
  administrative
  expenses                   6.3%          5.0%        5.7%
                           ------        ------      ------
Total operating
  expenses                  43.0%         45.0%       46.2%
                           ------        ------      ------
                                                         
Operating income             6.9%          6.2%        7.7%   
Income before income
  taxes                      7.8%          8.3%        7.9%
                           ------        ------      ------
Net income                   4.4%          3.9% <F1>   4.6% <F1>
                           ------        ------      ------                    
<FN>
<F1> Pro forma unaudited see Note B.
</FN>
</TABLE>


Years Ended December 28, 1996 and December 31, 1995.

Sales.  Volume increased by 26.2% from 961,000 barrels in 1995 to
1,213,000 barrels in 1996. Net sales increased by 26.3% from $151,313,000
in 1995 to $191,116,000 in 1996. Sales volume reflected continued growth in
Sam Adams Boston Lager, increases in the volume of seasonal beers,
increases in the Oregon Original beers, and the introduction of Golden
Pilsner, and the LongShot line of beers. The average net sales price per
barrel increased $.10 due primarily to an increase in selling prices offset
by increases in quality assurance and in customer discounts.

Gross Profit.   Gross profit increased by 23.1% from $77,466,000 in 1995 to
$95,330,000 in 1996. Cost of sales per barrel increased to 50.1% of net sales
in 1996 from 48.8% of net sales in 1995. This increase was due principally to
the following: increased obsolescence expense (consisting primarily of
reserves for re-used glass and work-in-process) higher depreciation (princi-
pally on kegs) and a reduction in re-used glass savings, offset by a net
decrease in raw material cost and packaging costs.

Advertising, Promotional, and Selling.   Advertising,  promotional, and
selling expenses increased by 16.0% from $60,461,000 in 1995 to $70,131,000
in 1996. The per barrel expense actually decreased by $5.09 from $62.91 in
1995 to $57.82 in 1996. As a percentage of net sales, advertising, promo-
tional, and selling expenses decreased from 40.0% in 1995 to 36.7% in 1996.
The aggregate dollar increase in advertising, promotional, and selling
expenses reflected increases in purchases of point of sales materials,
advertising, and promotional expenses, freight, and salaries and related
employee benefits. These expenses include expenditures for advertising,
promotions, and selling expenses for new product introductions not related
to the Samuel Adams product line.

General and Administrative.   General and administrative expenses increased
by 58.8% from $7,585,000 in 1995 to $12,042,000 in 1996. This increase of
$4,457,000 was primarily caused by an increase of $1,722,000 in bad debt
expense, which are both customer specific and general in nature, and
increases in personnel and salaries and related employee benefits, additional
leased space at the executive office, and additional costs related to the
Company becoming a public entity.

Other Income (Expense), Net.  Other income, net, increased by 78.7% from
$959,000 in 1995 to $1,714,000 in 1996. This increase of $755,000 reflects
$1,480,000 increase in interest income on the proceeds of the November, 1995
stock offering, offset by the $807,000 one-time gain on the sale of distri-
bution rights sold in 1995. Interest expense remained relatively stable from
1995 to 1996. It should be noted that the interest income earned during 1995
on the proceeds from the stock offering in November, 1995 reflects a period
of approximately one and one half months versus an entire year during 1996.

Net Income.  Net income decreased by 33.3% to $8,385,000 in 1996 from
$12,574,000 in 1995. The decrease is due to an income tax expense of
$6,486,000 in 1996 versus an income tax benefit of $2,195,000 in 1995. This
decrease is offset by an increase in other income of $755,000 and an increase
in operating income of $3,737,000 as discussed above.

Pro Forma Net Income.  Net income increased by 42.2% to $8,385,000 in 1996
from a pro forma net income of $5,896,000 in 1995. The increase in net income
is comprised of a net increase in other income of $755,000 and a net increase
in operating income of $3,737,000, as discussed above. This increase is
somewhat offset by a $2,003,000 increase in state and federal income taxes
(reflecting the higher graduated tax brackets applicable to the higher income
before tax).

Years Ended December 31, 1995 and 1994.

Sales.  Volume increased by 34.6% from 714,000 barrels in 1994 to
961,000 in 1995. Net sales increased by 31.8% from $114,833,000 in 1994 to
$151,313,000 in 1995. Sales volume reflected continued growth in Samuel
Adams Boston Lager, Honey Porter, and seasonal beers, and the introduction
of Scotch Ale. The average net sales price per barrel decreased  $3.38 due
primarily to an increase in customer discounts, product mix, and expanded
sales in geographic areas where beer prices are slightly lower than in the
Company's original markets.

Gross Profit.   Gross profit increased by 25.0% from $61,982,000 in 1994 to
$77,466,000 in 1995. Cost of sales increased $2.82 per barrel to 48.8% of
net sales in 1995 from 46.0% of net sales in 1994. This increase was due
principally to increased raw material costs, particularly malt; package
design for new products; logistical expenses related to the increase in
sales volume and seasonal products; abnormally high disposal of obsolete
packaging materials; and higher keg depreciation, due to the volume
increase in kegs. The per barrel increases were partially offset by
reductions in other areas, particularly glass packaging costs.

Advertising, Promotional, and Selling.   Advertising, promotional, and
selling expenses increased by 30.0% from $46,503,000 in 1994 to $60,461,000
in 1995. The per barrel expense actually decreased by $2.22 from $65.13 in
1994 to $62.91 in 1995. As a percentage of net sales, advertising,
promotional, and selling expenses decreased from 40.5% in 1994 to 40.0% in
1995. The aggregate dollar increase in advertising, promotional, and
selling expenses reflected increases in purchase of point of sales
materials, advertising expenditures, promotional programs, and salaries and
related employee benefits. These expenses include expenditures for
advertising, promotions, and selling expenses for new product introductions
not related to the Samuel Adams product line.

General and Administrative.   General and administrative expenses increased
by 15.0% from $6,593,000 in 1994 to $7,585,000 in 1995. This increase of
$992,000 was primarily caused by increases in personnel and salaries and
related employee benefits, increases in legal, insurance, and depreciation
and computer services due to the purchase and installation of new computer
equipment and software. These increases were partially offset by reductions
in other areas. As a percentage of net sales, general and administrative
expenses decreased from 5.7% in 1994 to 5.0% in 1995.

Other Income (Expense), Net.   In 1995, the Company recorded a nonrecurring
$807,000 gain related to the sale of certain distribution rights in a major
metropolitan area. Interest income and income expense remained relatively
stable from 1994 to 1995. It should be noted that the interest income earned 
during 1995 on the proceeds from the stock offering in November, 1995 reflects 
a period of approximately one and one half months.

Net Income.   Net income increased by 38.4% to $12,574,000 in 1995 from
$9,085,000 in 1994. The increase includes a one-time tax benefit of
$1,960,000 recorded upon the change in tax status of the entity as required
by SFAS 109, and a tax benefit of $235,000 for the period from November 21
to December 31, 1995. The balance of the increase in net income is
comprised of a net increase in other income of $760,000 and a net increase
in operating income of $534,000, as discussed above.

Pro Forma Net Income.   Pro forma net income increased by 10.8% from
$5,320,000 in 1994 to $5,896,000 in 1995, due to the factors described
above. Operating income was adversely affected by net marketing investment
(advertising, promotional, and other selling expenses in excess of gross
profit generated) in the amount of $2,800,000 from two new product
initiatives not related to the Samuel Adams product line. Management
estimated that cash flows and net income would be adversely affected by
approximately $750,000 during 1996 in a transaction with Joseph E. Seagram
& Sons, Inc. The actual amount of the 1996 expense associated with the
Joseph E. Seagram & Sons, Inc. transaction was $885,000. The Company does
not expect this transaction to generate royalties until 1998. The pro forma
effective tax rate increased from 41.4% in 1994 to 43.2% in 1995. This
increase was primarily due to an increase in meals and entertainment
expenses, which are only 50% tax deductible.

     Operating income increased 6.0% from $8,886,000 in 1994 to $9,420,000
in 1995. This increase was the result of an increase in gross profit of
25.0%, offset by increases in operating expenses of 28.2%.

Liquidity and Capital Resources

     The Company's financial condition continued to be strong  in 1996 due
primarily to the net proceeds raised by its initial public offering. The
Company is currently negotiating two unsecured bank lines of credit which
will provide for borrowings of up to $15,000,000 on one line of credit,
which is an increase of $1,000,000 on the existing $14,000,000 line of
credit, and up to $30,000,000 on the other line of credit. In addition, the
Company has obtained a $9,000,000 foreign exchange credit line. With a
substantial amount of highly liquid assets and working capital of
$47,769,000 at December 28, 1996, capital resources in conjunction with
existing lines of credit should be sufficient to meet the Company's
operating, capital, and debt service requirements over the next year.

     The Company has outstanding borrowings of $1,875,000 which mature in
2007. The Company plans to make approximately $21,000,000 of total capital
expenditures in 1997, principally related to the purchase of packaging and
brewing equipment for its contract breweries and the purchase of the
Schoenling assets.

     Operating activities provided cash of $15,763,000 in 1996 compared to
$2,440,000 in 1995. The primary cause of the improvement was the increase
in accounts payable, principally due to the timing of the receipt of hops,
offset somewhat by increases in inventory and other current assets,
principally due to the Company's investment in The Schoenling Brewery
Company prior to the exercise of the purchase option. Cash used in
investment activities decreased by $18,245,000, primarily due to increased
capital spending. Cash provided by financing activities primarily reflects
the tax benefit related to the exercise of employee stock options.

     Assuming there is no significant change in the Company's business, the
Company believes that the existing cash and short term investments as well
as cash flows from operations and the existing lines of credit will be
sufficient to meet its working capital requirements for at least the next
twelve months.

Recent Accounting Pronouncements

     In February, 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128, "Earnings Per Share"
(SFAS 128), which is effective for fiscal years that end after December 15,
1997, including interim periods. Earlier application is not permitted.
However, an entity is permitted to disclose pro forma earnings per share
amounts computed using SFAS 128 in the notes to financial statements in
periods prior to adoption. The Statement requires restatement of all prior-
period earnings per share data presented after the effective date.  SFAS
128 specifies the computation, presentation, and disclosure requirements
for earnings per share and is substantially similar to the standard
recently issued by the International Accounting Standards Committee
entitled International Accounting Standards, "Earnings Per Share" (IAS 33).
The Company plans to adopt SFAS 128 in 1997 and has not yet determined the
impact.

Certain Factors Affecting Future Operating Results

Statements made or incorporated in this Form 10-K include a number of
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1993 and Section 21E of the Securities Exchange Act of
1934. Forward-looking statements include, without limitation, statements
containing the words "anticipates", "believes", "expects", "intends",
"future" and words of similar import which express management's belief,
expectations, or intentions regarding the Company's future performance. The
Company's actual results could differ materially from those set forth in
the forward-looking statements.

The Company may experience significant fluctuations in future operating
results, which may be caused by many factors, including, but not limited to
(1) further slowing of the growth rate of the craft brewing segment; (2)
share-of-market erosion due to increased competition; (3) increased promo-
tional expenditures versus historical spending and versus the 1997 operating
plan; (4) higher-than-planned costs of operating the Samuel Adams brewery in
Cincinnati; (5) an unexpected increase in raw material or packaging costs 
which cannot be passed along through increased prices; (6) slower-than-
planned acceptance of Hard Core cider by the trade and consumer; (7) 
inability of Oregon Original beers and other Samuel Adams styles to 
maintain historic growth rates.



<PAGE>
 

 
Item 8.      Financial Statements and Supplementary Data

               INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


                                                                       Page(s)
  Report of Independent Accountants ............................          19

  Consolidated Financial Statements of The Boston Beer Company, Inc. 
  
     Consolidated Balance Sheets at December 28, 1996 and 
       December 31, 1995 ........................................         20

     Consolidated Statements of Income for the Years Ended
       December 28, 1996, December 31, 1995, and 
       December 31, 1994 ........................................         21

     Consolidated Statements of Stockholders' Equity
       For the Years Ended December 28, 1996, December 31, 1995, and
       December 31, 1994 ........................................         22

     Consolidated Statements of Cash Flows for the Years Ended
       December 28, 1996, December 31, 1995, and 
       December 31, 1994 ........................................         23

     Notes to the Consolidated Financial Statements .............         24

Financial Statement Schedules for the years ended December 28, 1996,
    December 31, 1995, and December 31,1994
      All schedules are omitted because the required information is
      shown in the financial statements or the notes thereto.

                               Page 18

<PAGE>


 REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors and Stockholders of
The Boston Beer Company, Inc.

     We have audited the accompanying consolidated balance sheets of The
Boston Beer Company, Inc. (formerly Boston Beer Company Limited
Partnership) as of December 28, 1996 and December 31, 1995, and the related
consolidated statements of income, stockholders' equity, and cash flows for
each of the three years in the period ended December 28, 1996, December 31,
1995, and December 31, 1994. These financial statements are the
responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audit.

     We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.

     In our opinion, the financial statements referred to above present
fairly, in all material respects, the consolidated financial position of
The Boston Beer Company, Inc. as of December 28, 1996 and December 31,
1995, and December 31, 1994, and the consolidated results of its operations
and its cash flows for each of the three years in the period ended December
28, 1996, December 31, 1995, and December 31, 1994, in conformity with
generally accepted accounting principles.



                                   Coopers & Lybrand L.L.P.



Boston, Massachusetts
February 21, 1997, except for Note O,

 as to which the date is March 1, 1997.

                               Page 19

<PAGE>

<TABLE>

                        THE BOSTON BEER COMPANY, INC.
                        CONSOLIDATED BALANCE SHEETS
                      (in thousands, except share data)
                                                                 
<CAPTION>                                                            
                                                        December 28,       December 31,
                                                           1996                1995
<S>                                             <C>                <C>
ASSETS
 Current Assets:
  Cash & cash equivalents                       $     5,060        $     1,877
  Short term investments                             35,926             34,730
  Accounts receivable                                18,109             16,265
  Allowance for doubtful accounts                    (1,930)              (175)
  Inventories                                        13,002              9,280
  Prepaid expenses                                      674                437
  Deferred income taxes                               2,968              1,011
   Other current assets                               3,882              1,858
                                                ------------       ------------
      Total current assets                           77,691             65,283
                                                                 
  Restricted investments                                611                602
  Equipment and leasehold improvements, at cost      21,043              9,690
  Accumulated depreciation                           (6,412)            (3,531)
  Deferred income taxes                                 151              1,777
  Other assets                                        3,469              2,869
                                                ------------       ------------
       Total assets                             $    96,553        $    76,690
                                                ===========       ============
                                                        
LIABILITIES AND STOCKHOLDERS' EQUITY
                                                                 
 Current Liabilities:
  Accounts payable                              $    17,783        $     9,793
  Accrued expenses                                   12,064             10,149
  Current maturities of long-term debt                   75                 75
                                                ------------       ------------
       Total current liabilities                     29,922             20,017

                                                                 
  Long-term debt, less current maturities             1,800              1,875
                                                                 
    Commitments and Contingencies (Note I)                -                  -
                                                                 
                                                                 
  Stockholders' Equity:
     Class A Common Stock, $.01 par value;
     20,300,000 shares authorized; 
     15,972,058, and 15,643,664 issued and 
     outstanding as of December 28, 1996 and
     December 31, 1995, respectively                    160                156
     Class B Common Stock, $.01 par value;
     4,200,000 shares authorized; 4,107,355
     issued and outstanding as of December 
     28, 1996 and December 31, 1995,                     
     respectively                                        41                 41
  Additional paid-in-capital                         55,391             53,482
  Unearned compensation                                (363)              (509)
  Unrealized loss on investments in  
     marketable securities                             (442)                 -
  Unrealized gain on forward              
     exchange contract                                   31                  -
  Retained earnings                                  10,013              1,628
                                                ------------       ------------
     Total stockholders' equity                      64,831             54,798
                                                ------------       ------------
     Total liabilities and stockholders'        
       equity                                   $    96,553        $    76,690
                                                ============       ============
 
                                                                 
     The accompanying notes are an integral part of the financial statements.

                               Page 20
</TABLE>


<PAGE>

<TABLE>
                        THE BOSTON BEER COMPANY, INC.
                      CONSOLIDATED STATEMENTS OF INCOME
                    (in thousands, except per share data)
<CAPTION>                                                                       
                                                          For the Years Ended
                           December 28,      December 31,        December 31,
                                1996              1995                1994     
<S>                        <C>                <C>                 <C> 
Sales                      $ 213,879          $ 169,362           $ 128,077    
Less excise taxes             22,763             18,049              13,244    
                           ----------         ----------          ----------
Net sales                    191,116            151,313             114,833    
Cost of sales                 95,786             73,847              52,851    
                           ----------         ----------          ----------
Gross profit                  95,330             77,466              61,982    
                                                                       
Operating expenses:                                                    
Advertising, promotional                       
 and selling expenses         70,131             60,461              46,503
General and administra-
 tive expenses                12,042              7,585               6,593
                           ----------         ----------          ----------
   Total operating
     expenses                 82,173             68,046              53,096    
                           ----------         ----------          ----------
Operating income              13,157              9,420               8,886    
                                                                       
Other income (expense):                                                
Interest income                1,932                452                 429    
Interest expense                (236)              (250)               (233)    
Other income, net                 18                757                   3    
                            ----------         ----------          ----------
   Total other income          1,714                959                 199    

Income before income
 taxes                        14,871             10,379               9,085    
Provision (benefit) 
 for income taxes              6,486             (2,195)                  -
                            ----------         ----------          ----------
Net income                 $   8,385          $  12,574           $   9,085    
                            ==========         ==========          ==========
                                

Pro forma data (unaudited) (Note B):
Income before pro forma
         income taxes                            10,379               9,085    
Pro forma income tax 
 expense                                          4,483               3,765    
                                              ----------          ----------
Pro forma net income                          $   5,896           $   5,320    
                                              ==========          ==========
         
                                                                       
Net income per common and                                              
  common equivalent 
  share                   $    0.41          $    0.33 <F1>      $    0.29 <F1>
                          ==========         ==========          ==========
                  
Weighted average num-
 ber of common and
 common equivalent
 shares                      20,352             17,949 <F1>         18,171 <F1>
                          ==========         ==========          ==========

<FN>
<F1> Pro forma, see Note B.
</FN>                                                                      
      The accompanying notes are an integral part of the financial statements.

                               Page 21
</TABLE>


<PAGE>

<TABLE>


                                THE BOSTON BEER COMPANY, INC.
                        CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
     For the three years ended December 28, 1996, December 31, 1995, and 
      December 31, 1994
                                (in thousands)
                                                                               
<CAPTION>                                                                      
                                                                                
                  General  Limted    Compen-   Partners' 
                  Partner  Partners  sation    Equity    
<S>                <C>       <C>      <C>      <C>       
Balance Dec-              
 ember 31,1993     $   803   $ 8,051            $  8,854 
Net income           2,242     6,843               9,085                        
Compensation                         
 associated
 with stock
 options                 -       280                 280                        
Partner dis-              
 tributions         (2,813)   (8,806)            (11,619)                      
                   ---------------------------------------
Balance Dec-
 ember 31, 1994        232     6,368               6,600

Net income:Jan-      2,694     8,252              10,946                     
 uary 1 through
 November 20, 
 1995 allocated
 to the Part-
 nership;
 thereafter to
 the Company
Partner dis-              
 tributions         (4,712)   (14,343)           (19,055)                     
Conversion of                       
 incentive/
 investment
 stock plans
 to stock
 option/pur-
 chase plans                    4,763     (618)    4,145
Stock options                         
 issued                           141     (141)        -                       
 of unearned
 compensation
 expense                                   250       250                       
Contributed                
 capital upon
 realization         1,786     (5,181)     509    (2,886) 
                   -----------------------------------------
Balance Dec-                                                                    
 ember 31, 1995          -          -        -         -     
                   =========================================
</TABLE>


<TABLE>
<CAPTION>           
                                                   Unreal-           Total  
             Class A   Class B  Add'l    Unearned  ized     Retain-  Stock-   
             Common    Common   Paid in  Comp-     Gains/   ed       holders' 
             Stock     Stock    Capital  ensation  Losses   Earnings Equity
<S>          <C>       <C>     <C>      <C>       <C>      <C>      <C>
Net income 
 of the
 Company
 November
 21, 1995
 to Decem-
 ber 31, 
 1995                                                       $ 1,628  $  1,628   
Contributed 
 capital upon
 recapital-
 ization     $  125   $  41    $ 3,822  $  (509)                        3,479
Common stock 
 issued          31             49,660                                 49,691
             -------------------------------------------------------------------
                156      41     53,482     (509)              1,628    54,798

Net income                                                    8,385     8,385   
Unearned
 comp-                                                                          
 ensation
 on stock
 options
 granted                           157     (157)                            - -
Forfeiture of                                                                  
 unvested
 stock options                    (144)     144                                -
Stock options                                                
 exercised               4         556                                    560
Tax benefit                                                                    
 related to
 exercise of
 employee
 stock options                   1,376                                  1,376
Proceeds from                                                                   
 sale under
 stock purch-
 ase plan                           40                                     40
Repurchase of                                                                  
 shares under
 employee
 investment and
 incentive share
 plans                            (103)                                  (103)
Amortization of                                                                
 unearned comp-
 ensation expense                   27      159                            186
Unrealized loss                                                                
 on short term
 investments                                          (442)               (442)
Unrealized gain                                                                
 on forward
 exchange con-
 tract                                                  31                  31
                ---------------------------------------------------------------
Balance Dec-           
 ember 28, 1996 $  160  $  41 $55,391   $  (363)    $ (411)   $ 10,013 $ 64,831
                ===============================================================
                
     The accompanying notes are an integral part of the financial statements.

                               Page 22
</TABLE>


<PAGE>

<TABLE>
                                THE BOSTON BEER COMPANY, INC.
                            CONSOLIDATED STATEMENTS OF CASH FLOWS
                                     (in thousands)
<CAPTION>                                                               
                                          For the Years Ended
                           ----------------------------------------------
                            December 28,     December 31,    December 31,
                                1996             1995           1994  
<S>                          <C>             <C>              <C>
Cash flows from 
 operating activities:
 Net income                  $   8,385        $  12,574 <F1>  $   9,085 <F1> 
 Adjustments to recon-
  cile net income to
  net cash provided by
  operating activities:                                     
   Depreciation and 
    amortization                 3,030            1,565             925         
   (Gain) loss on 
    disposal of fixed 
    asset                           (4)              38              21 
   Bad debt expense              1,832             (557)            391
   Stock option compen-
    sation expense                 186              250             280
 Changes in assets & liabil-
  ities:
  Accounts receivable           (1,921)          (5,473)         (2,339) 
  Inventory                     (3,722)          (1,525)         (4,049) 
  Prepaids expense                (237)              64            (285) 
  Other current assets          (1,993)            (753)           (593) 
  Deferred taxes                  (331)          (2,195)              -
  Other assets                    (743)          (2,459)           (172) 
  Accounts payable               7,990             (494)          6,353 
  Accrued expenses               3,291            1,405           3,673 
                              -----------      ----------      ----------
   Total adjustments             7,378          (10,134)          4,205
                              -----------      ----------      ----------   
   Net cash provided by
    operating                                   
    activities:                 15,763            2,440          13,290 
                              -----------      ----------      ----------
Cash flows for investing
 activities:
  Purchases of fixed assets    (11,359)          (4,268)         (2,621) 
  Proceeds on disposal of
   fixed assets                      4               45               -
  (Purchases) maturities
   of government                                          
   securities                    2,648          (27,027)         (2,624)  
  Purchase of marketable
   securities                   (4,286)               -               -   
  Purchase of restricted
  investments                   (1,225)            (612)         (1,171)
  Maturities of restricted
   investments                   1,216              615           1,145      
                              ----------       ----------       ---------
      Net cash used in
       investing               (13,002)         (31,247)         (5,271) 
                              ----------       ----------       --------- 
                                               
Cash flows from financing
 activities:
  Proceeds from issuance of
   common stock                      -           49,691               -
  Proceeds from exercise 
   of stock option
   plans                           560                -               -     
  Proceeds from sale under
   stock purchase 
   plan                             40                -               -
  Repurchase of shares under
   employee
   investment and incentive
    share plans                   (103)               -               -
  Principal payments on 
   long-term debt                  (75)             (50)            (50)
  Partners' distributions            -          (19,055)        (11,619)
                             ----------       ----------      ----------
    Net cash provided by 
     (used for)
     financing activities          422           30,586          11,669
                              ----------       ----------      ----------
Net increase (decrease)
 in cash and cash
 equivalents                     3,183            1,779          (3,650)

Cash and cash equivalents 
 at beginning of period          1,877               98           3,748   
                              -----------      ----------      ----------
Cash and cash equivalents
 at end of period            $   5,060        $   1,877       $      98
                              ===========      ==========      ==========
Supplemental disclosure of
 cash flow information:
  Interest paid              $     224        $     252       $     236   
  Taxes paid                 $   5,992                -               -
                              ===========      ==========      ==========

<FN>
<F1>  Net income for the fiscal year ended December 31, 1995 is before pro
      forma income taxes. See Note B.
</FN>
       The accompanying notes are an integral part of the financial statments.
                                
                                         
                               Page 23
</TABLE>


<PAGE>

                        THE BOSTON BEER COMPANY, INC.

                    NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

A.      Basis of Presentation:

The Boston Beer Company, Inc. (the "Company"), is engaged in the business
of marketing and selling beer and ale products throughout the United States
and in select international markets. On November 20, 1995, in connection
with the initial public offering of the Company's stock effected that date,
the non-corporate limited partners transferred their respective partnership
interests to the Company and the owners of the general partner and
corporate limited partners transferred their respective ownership interests
in such entities to the Company. In exchange, the transferors received an
aggregate of 16,641,740 shares of the Company's common stock on a pro rata
basis, based on their then respective percentage equity interests in the
Partnership. The aforementioned transactions are collectively referred to
hereinafter as the "Recapitalization."

B.      Summary of Significant Accounting Policies:

Fiscal Year
Effective in fiscal 1996, the Company changed its fiscal year to end on the
last Saturday in December. The impact on the current year of two fewer days
of operations was not material.

Principles of Consolidation
The consolidated financial statements include the accounts of the Company,
its subsidiaries, and the Partnership. All intercompany accounts and
transactions have been eliminated.

Revenue Recognition
Revenue is recognized when goods are shipped to customers. Accounts
receivable balances are reflected net of an allowance for uncollectible
accounts of approximately $1,930,000 and $175,000 at December 28, 1996 and
December 31, 1995, respectively.

Cash and Cash Equivalents
Cash and cash equivalents include cash in hand and short-term, highly
liquid investments with original maturities of three months or less at the
time of purchase.

Short Term Investments and Restricted Investments
Short term investments consist primarily of U.S. Government securities and
marketable equity securities with original maturities beyond three months
and less than twelve months. All short term investments have been
classified as available-for-sale and are reported at fair value with
unrealized gains and losses included in stockholders' equity. Fair value is
based on quoted market prices as of December 28, 1996.

Restricted investments consist solely of the unexpended proceeds from the
debt as discussed in Note G. These investments, consisting of treasury
notes which mature within one year, are expected to be held to maturity and
accordingly are valued at amortized cost, which approximates fair value.

Inventories
Inventories, which consist principally of hops, bottles, and packaging, are
stated at the lower of cost, determined on a first-in, first-out (FIFO)
basis, or market.

Use of Estimates
The preparation of the financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affected the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of revenue
and expenses during the reporting period. Actual results could differ from
those estimates.

<PAGE>
                        THE BOSTON BEER COMPANY, INC.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                            (Continued)

B.      Summary of Significant Accounting Policies (Continued):

Concentrations of Credit Risk
Financial instruments which potentially subject the Company to
concentrations of credit risk consist principally of temporary cash, short-
term investments, and trade receivables. The Company places its temporary
cash and short-term investments with high credit quality financial
institutions. The Company sells primarily to independent beer and ale
distributors across the United States. Receivables arising from these sales
are not collateralized; however, credit risk is minimized as a result of
the large and diverse nature of the Company's customer base. The Company
establishes an allowance for doubtful accounts based upon factors
surrounding the credit risk of specific customers, historical trends, and
other information.

Equipment and Leasehold Improvements
Equipment and leasehold improvements are recorded at cost. Expenditures for
maintenance, repairs, and renewals are charged to expense; major
improvements are capitalized. Upon retirement or sale, the cost of the
assets disposed of and the related accumulated depreciation are removed
from the accounts and any resulting gain or loss is included in the
determination of net income. Provision for depreciation is computed on the
straight-line method based upon the estimated useful lives of the
underlying assets as follows:

     Kegs and equipment               3 to 10 years
     Office equipment and furniture   3 to 5 years
     Leasehold improvements           5 years, or the life of the lease,
                                        whichever is shorter

Deposits
The Company recognizes a liability for estimated refundable deposits in
kegs and for unclaimed deposits on bottles which are subject to state
regulations. A liability for refundable deposits (redemptions) on reusable
bottles in 1995 was not recorded, nor was there an offsetting adjustment to
inventory. As of December 28, 1996, the Company recorded an estimated liabil-
ity of $587,000, with an offsetting adjustment to cost of goods sold for 
re-used glass which had not been redeemed as of the end of the year. The
Company recorded this liability to recognize that the re-used glass may not  
be placed back into production in the future. Total redemptions associated 
with reusable bottles during the years ended December 28, 1996, December 31, 
1995, and 1994 were $3,053,000, $1,441,000, and $1,402,000 respectively.

Fair Value of Financial Instruments
The carrying amount of the Company's long term debt, including current
maturities, approximates fair value because the interest rates on these
instruments change with market interest rates. The carrying amounts for
accounts receivable and accounts payable approximate their fair values due
to the short term maturity of these instruments.

Advertising and Sales Promotions
Advertising and sales promotional programs are charged to expense during
the period in which they are incurred. Total advertising and sales
promotional expense for the years ended December 28, 1996, December 31,
1995, and 1994, were $35,730,000, $35,039,000, and $27,598,000
respectively.

Purchase Commitments
The Company recognizes losses on hops purchase commitments when amounts
from the sale price of the related product are expected to be less than the
cost of the product. The Company has not historically experienced any
losses related to hops purchase commitments.

Forward Exchange Contracts
Unrealized gains and losses on contracts designated as hedges of existing
assets and liabilities are accrued as exchange rates change and are
recorded as a component of Stockholders' Equity. Realized gains and losses
are recognized in income as contracts expire.

Stock-Based Compensation
Statement of Financial Accounting Standards No. 123 "Accounting for Stock-
Based Compensation" ("SFAS 123"), requires the Company to either elect
expense recognition or the disclosure-only alternative for stock-based
employee compensation. SFAS 123 has been adopted in the Company's 1996
financial statements with comparable disclosures for the prior year. The
Company has reviewed the adoption and impact of SFAS 123, and has elected
to adopt the disclosure-only alternative and accordingly this standard has
no impact on the Company's results of operations or its financial position.

<PAGE>
                    THE BOSTON BEER COMPANY, INC.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                         (Continued)

B.     Summary of Significant Accounting Policies (Continued):

Income Taxes
The Company records income taxes under the liability method whereby
deferred tax assets and liabilities are determined based on differences
between financial reporting  and tax bases of assets and liabilities, and
are measured by applying enacted tax rates for the taxable years in which
those differences are expected to reverse.

Pro Forma Income Taxes (unaudited)
The financial statements of the Company for the periods prior to the
Recapitalization do not include a provision for income taxes because the
taxable income of the Company, up until the effective date of the
Recapitalization, is included in the income tax returns of the
Partnership's partners and former Subchapter S corporation's shareholder.
The statements of income include a pro forma income tax provision on
taxable income for financial statement purposes using an estimated
effective federal and state income tax rate which would have resulted if
the Partnership and Subchapter S corporation had filed a corporate income
tax return during those periods.

Earnings Per Share
Earnings per share is based on the weighted average number of shares
outstanding during the period after consideration of the dilutive effect,
if any, for stock options. Fully diluted net income per share has not been
presented as the amount would not differ significantly from those
presented.

Pro Forma Earnings Per Share (unaudited)
Pro forma earnings per share is based on the weighted average number of
common and common equivalent shares outstanding during the respective
periods (assuming a conversion of partnership units for the periods prior
to the Recapitalization), and an additional 3,109,279 shares issued during
November 1995 in connection with the Company's initial public offering. In
addition, pursuant to the rules of the Securities and Exchange Commission,
approximately 273,000 shares and 965,000 shares in 1995 and 1994,
respectively, have been included in the share calculation representing
distributions in excess of net income and, in 1994, distributions expected
to be funded by debt repaid with the proceeds from the offering. The
calculations include 686,000 and 564,000 common equivalent shares for the
years ended December 31, 1995 and 1994, respectively, using the treasury
stock method. Fully diluted earnings per share is not materially different
from primary earnings per share.

New Accounting Pronouncements
In February, 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128, "Earnings Per Share"
(SFAS 128), which is effective for fiscal years that end after December 15,
1997, including interim periods. Earlier application is not permitted.
However, an entity is permitted to disclose pro forma earnings per share
amounts computed using SFAS 128 in the notes to financial statements in
periods prior to adoption. The Statement requires restatement of all prior-
period earnings per share data presented after the effective date.  SFAS
128 specifies the computation, presentation, and disclosure requirements
for earnings per share and is substantially similar to the standard
recently issued by the International Accounting Standards Committee
entitled International Accounting Standards, "Earnings Per Share" (IAS 33).
The Company plans to adopt SFAS 128 in 1997 and has not yet determined the
impact.

Reclassifications
Beginning in 1996, certain expenses which were previously classified as
general and administrative expenses were reclassified as advertising,
promotional, and selling expenses. All financial information has been
restated to conform with this year's presentation. Certain other prior year
amounts have also been reclassified to conform with the current year's
presentation.

C.      Short Term Investments:

Short term investments consist of marketable equity securities having a
cost of $4,286,000 and a market value of $3,844,000, which resulted in an
unrealized loss of $442,000 at December 28, 1996. The Company did not have
any investments in marketable equity securities as of December 31, 1995. In
addition, the Company has investments in U.S. Government securities having
a cost of $32,082,000 and $34,730,000 at December 28, 1996 and December 31,
1995, respectively, which approximates fair value.

<PAGE>


                    THE BOSTON BEER COMPANY, INC.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                         (Continued)

D.       Inventories:

                                  December 28,        December 31,
                                     1996                1995
                                        (in thousands)
Raw material, principally hops    $ 12,677           $  8,543
Work in process                          -                518
Finished goods                         325                219
                                  --------           --------
                                  $ 13,002           $  9,280
                                  =========          ========

E.      Equipment and Leasehold Improvements:

                                 December 28,        December 31,
                                     1996                1995
                                         (in thousands)
Kegs and equipment                 $  16,457          $  7,012
Office equipment and furniture         3,527             1,623
Leasehold improvements                 1,059             1,055
                                   ----------         --------
                                   $  21,043          $  9,690
Less accumulated depreciation          6,412             3,531
                                   ---------          --------
                                   $  14,631          $  6,159
                                   =========          ========

The Company recorded depreciation expense related to these assets of
$2,886,000, $1,565,000, and $925,000 for the years ended December 28, 1996,
December 31, 1995, and December 31, 1994, respectively.

F.      Accrued Expenses:

                                   December 28,        December 31,
                                       1996                1995
                                           (in thousands)

Advertising                        $   4,019            $  4,451
Keg deposits                           1,813               1,276
Employee wages and reimbursements      1,906               1,586
Point of sale related accruals         1,288               1,000
Other accrued liabilities              3,038               1,836
                                   ---------            --------
                                   $  12,064            $ 10,149
                                   =========            ========


For the year ended December 28, 1996, the Company included $1,117,000 of
accrued freight costs in accounts payable. For the year ended December 31,
1995, $1,189,000 of freight costs previously recognized as a component of
accrued expenses were reclassified to accounts payable.

<PAGE>

                THE BOSTON BEER COMPANY, INC.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                         (Continued)

G.      Long-Term Debt and Line of Credit:

Long-Term Debt
During 1988, the Company entered into a $2,200,000 loan with the
Massachusetts Industrial Finance Authority ("MIFA"), which matures July 15,
2007. As of  December 28, 1996, the loan requires scheduled annual
principal payments as follows:

                                             (in thousands)
     1997  ...............................   $     75
     1998  ...............................         75
     1999  ...............................        100
     2000  ...............................        100
     2001  ...............................        100
     Thereafter  .........................      1,425
                                             --------
                                                1,875
     Less: current portion                         75
                                             --------
     Total long-term debt                    $  1,800
                                             ========

Interest accrues at 11.5 % and is paid semiannually. The proceeds from the
MIFA loan were used to fund approximately $1,500,000 of engineering and
design efforts, which were subsequently abandoned in 1989, and to acquire
approximately $200,000 of various assets for the brewery. The unexpended
proceeds referenced in Note B were restricted to the further development of
the Company's Boston brewery, a leased facility. All assets acquired with the 
proceeds of the loan are reflected as equipment or leasehold improvements. 
The loan is collateralized by the related fixed assets and any unexpended 
proceeds which approximated, including interest, $611,000 and $602,000 at 
December 28, 1996 and December 31, 1995, respectively.

The loan agreement contains various covenants, the most restrictive of
which is that the Company's equity may not be less than $700,000 as of the
end of each fiscal year, and the debt to equity ratio of the Company may
not exceed 4 to 1 at the end of any fiscal year. As of December 28, 1996,
the Company's equity was $65,000,000 and the debt to equity ratio was .03
to 1.

Line of Credit
On May 2, 1995, the Company entered into an unsecured Revolving Line of
Credit Agreement (the "Agreement") with a bank providing for borrowings of
up to $14,000,000 at either the bank's prime rate (8.25% at December 28,
1996) or the applicable Libor Rate plus .50% for terms of 30, 60, or 90
days. The Company pays a commitment fee of .15% of the unused portion of
the line. The Agreement, which expires on May 1, 1997, requires the Company
to maintain certain financial ratios related to tangible net worth,
interest coverage, and profits, and restricts the Company's ability to
incur additional indebtedness, incur certain liens and encumbrances, make
investments in other persons, engage in a new business, or enter into sale
and leaseback transactions. The Agreement also contains certain events of
default, including the failure of the Company's president to control and be
actively engaged on a full-time basis in the business of the Company. As of
December 28, 1996 and December 31, 1995, no borrowings were outstanding
thereunder.

H.     Income Taxes:

Income Taxes
Effective with the Recapitalization described in Note A, the Company became
subject to federal and state income taxes. The historical income tax
benefit reflects the recording of a one-time tax benefit of $1,960,000 upon
the change in tax status of the entity as required by SFAS 109, and a tax
benefit of $235,000 for the period from November 21 to December 31, 1995.


<PAGE>
                        THE BOSTON BEER COMPANY, INC.
               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                         (Continued)

H.     Income Taxes (continued):
Significant components of the Company's deferred tax assets and liabilities
as of December 28, 1996 and December 31, 1995 are as follows:

<TABLE>
<CAPTION>
                                        (in thousands)
                              1996                     1995              

                          Curr-   Long-              Curr-    Long-
                          ent     Term      Total    ent      term      Total
<S>                      <C>       <C>      <C>      <C>      <C>       <C> 
   
Deferred Tax Assets:
 Incentive/invest-
  ment unit and
   option plans          $   11    $ 1,052  $ 1,063   $   21   $ 1,856  $ 1,877
 Accrued expenses not 
  currently deductible      943          -      943      467         -     467
 Reserves                 1,828          -    1,828       88         -      88
 Deferred Compensation        -         90       90        -        65      65
 Net operating loss           -          -        -      334         -     334
 Other                      250         (2)     248      101         -     101
                         --------   -------- -------  -------  -------- -------
   Total deferred
    tax assets            3,032      1,140    4,172    1,011     1,921   2,932
Deferred tax liabil-
 ities:
  Depreciation                -       (814)    (814)       -      (144)   (144)
 Tax installment sale       (64)      (175)    (239)       -         -       -  
                         --------   --------  -------  ------- --------   -----
   Net deferred tax
    assets               $2,968    $   151   $3,119   $1,011    $ 1,777 $ 2,788
                        =========   =======  =======  ========  =======  ======

</TABLE>

The deferred tax asset balance at December 31, 1995 includes a $593,000 net
deferred tax asset of the corporate limited partners recorded upon the
Recapitalization.

Based upon prior earnings history and expected future taxable income, the
Company does not believe that a valuation allowance is required for the net
deferred tax asset.

Significant components of the income tax provision (benefit) for income
taxes for the years ended December 28, 1996 and December 31, 1995 are as
follows:

                                        (in thousands)
                                   1996           1995
Current:
     Federal                    $  5,261             -
     State                         1,556             -
                                --------       --------
Total current                      6,817             -

Deferred:
     Federal                        (251)     $  (1,667)
     State                           (80)          (528)
                                ---------     ----------
Total deferred                   $  (331)     $  (2,195)
                                ---------     ----------
Total income tax expense 
 (benefit)                       $ 6,486      $  (2,195)
                                ========      ==========


<PAGE>

                    THE BOSTON BEER COMPANY, INC.
               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                         (Continued)

H.     Income Taxes (continued):

The reconciliation of income tax computed at statutory rates to actual
income tax expense for the years ended December 28, 1996 and December 31,
1995, are as follows:

                                                1996             1995

Statutory rate                                  35.0%            35.0%
State income tax, net of federal  benefit        6.5             (1.8)
Permanent differences                            1.2              0.3
Income for the period prior to the 
 Recapitalization not subject to tax               -            (36.9)
Deferred tax asset resulting from change
   in tax status                                   -            (15.9)
Other                                            0.9             (1.8)
                                                -----          -------
                                                43.6%           (21.1%)
                                               ======          ========


At December 31, 1995, the Company had a tax net operating loss carryforward
of approximately $765,000, which arose during the period from November 21
to December 31, 1995, which was fully utilized in 1996.

I.      Commitments and Contingencies:

Purchase Commitments
In the normal course of business, the Company has entered into various
supply agreements with brewing companies. These agreements are cancelable
by the Company and by the brewing companies with advanced written notice.
Title to beer products brewed under these arrangements remains with the
brewing company until shipped by it and accordingly, the liquid is not
reflected as inventory by the Company in the accompanying financial
statements. The Company is required to reimburse the supplier for all
unused material and beer products on termination of the agreements and
under certain conditions to purchase excess materials. At December 28,
1996, there was approximately $4,468,000 of material and beer products in
process at the brewing companies which had not yet been transferred to the
Company. Purchases under these agreements for the years ended December 28,
1996, December 31, 1995, and 1994 were approximately $57,766,000,
$41,199,000, and $28,808,000, respectively.

The Company has entered into contracts for the supply of a portion of its
hops requirements. These purchase contracts, which expire at various dates
through 2003, specify both the quantities and prices the Company is
committed to. The prices are denominated in foreign currencies and the
Company does not hedge these commitments in French francs, but does in
German marks and English pound sterling. The amount of these commitments
outstanding at December 28, 1996 in U.S. dollars, is $52,530,000. Purchases
under these contracts for the years ended December 28, 1996, December 31,
1995, and 1994 were approximately $10,000,000, $5,924,000, and $6,061,000
respectively. The performance of the dealers under such contracts may be
materially affected by factors such as adverse weather, the imposition of
export restrictions and changes in currency exchange rates resulting in
increased prices.

At December 28, 1996, the Company had outstanding purchase commitments of
approximately $8,000,000 principally related to capital expenditures,
including the initial payment for the purchase of the Schoenling brewery,
and advertising expenditures through December 1997. There is a possibility
the Company could expend additional capital investments at the brewing
locations in the approximate range of $5,000,000 to $20,000,000 during
1997. It should be noted, that at this point in time, there is no
commitment to expend this additional investment.


<PAGE>

                    THE BOSTON BEER COMPANY, INC.
               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                         (Continued)

I.      Commitments and Contingencies (continued):

Lease Commitments
The Company has various operating lease agreements primarily involving real
estate. Terms of the leases include purchase options, renewals, and
maintenance costs, and vary by lease. These lease obligations expire at
various dates through 2001.

Minimum annual rental payments under these agreements are as follows:
                                   (in thousands)

    1997 ......................      $      802
    1998 ......................             673
    1999 ......................             668
    2000 ......................             565
    2001 ......................             565
    Thereafter ................               -
                                     ----------
                                     $    3,273
                                     ==========

Rent expense for the years ended December 28, 1996, December 31, 1995, and
1994 was approximately $512,000, $340,000, and $276,000 respectively.

Distribution
The Company's two largest distributors each accounted for approximately 6%
of the Company's net sales.

License Agreement
The Company signed a contract in March, 1996, with a major beverage company
with respect to a transaction in which that company will license and sell a
new craft brew beer whose trademark and trade names are owned by the
Company. The Company is expected to expense up to $750,000 in 1997 and 1998,
principally to cover marketing expenses to aid the introduction of this new
beer and will, in return, receive a royalty on sales after a certain period
of time. The Company will also provide certain technical assistance. The
agreement also sets forth the circumstances in which the relationship can
be terminated and the terms on which rights to the product will revert to
the Company or may be reacquired by the Company. There can be no assurance
that any contemplated  royalty will be earned by the Company.

Litigation
In early 1996, Boston Brewing Company, Inc. ("Boston Brewing"), an
affiliate of both Boston Beer Company Limited Partnership and The Boston
Beer Company, Inc., had an action filed against it by one of its
distributors, such action having been filed in a court in England. The
action contains a claim for damages of an alleged breach of a
Distributorship Agreement between Boston Brewing and the plaintiff. The
action is being vigorously defended by the Company and at present is in the
discovery stage.

In addition, the Company is subject to legal proceedings and claims which
arise in the ordinary course of business. In the opinion of management, the
amount of ultimate liability with respect to these actions will not
materially affect the financial position or results of operations of the
Company.

J.      Common Stock:

Initial Public Offering
On November 20, 1995, the Company completed an initial public offering and
sold an aggregate of 3,109,279 shares of Common Stock, of which 990,000
shares were sold for $15.00 per share in a best efforts offering and
2,119,279 shares were sold for $20.00 in an underwritten offering,
resulting in net proceeds, after deducting underwriting discounts and
expenses, of $49,691,000. In addition, as described in Note A, upon
Recapitalization the owners of the general and corporate limited partners
transferred their respective ownership interests to the Company. In
exchange, the transferors received an aggregate of 16,641,740 shares of the
Company's common stock on a pro rata basis based on their then respective
equity interest in the Partnership. The total number of shares of Class A
and Class B Common Stock outstanding after completion of the offering was
19,751,019.

<PAGE>
                    THE BOSTON BEER COMPANY, INC.
          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                         (Continued)

J.      Common Stock (continued):

Initial Public Offering (continued):
Upon Recapitalization, the Company recognized no gain or loss upon receipt
of the units of the Partnership from individual partners, and no gain or
loss upon receipt of stock in the corporate partners from the stockholders
of the corporate partners in exchange for the Company's stock based upon an
opinion from the Company's legal counsel interpreting the Internal Revenue
Code of 1986, as amended (the "Code"), the regulations of the Treasury
Department (the "Regulations"), and judicial opinions interpreting the
Code. The opinion is qualified by detailed and material limitations set
forth in the opinion concerning, among other things, the possibility of
Regulations being adopted with a retroactive effect. Any new legislation,
changes to and clarifications of the administrative positions of the IRS,
including by way of amendments to existing Regulations or adoption of new
Regulations, and subsequent judicial decisions including any retroactive
effects could have a material consequence to the Company.

Stock Compensation Plan
The Company's Employee Equity Incentive Plan (the "Equity Plan") was
adopted effective November 20, 1995 as the successor to the Partnership's
1995 Management Option Plan, which was, in turn, the successor to a series
of the Partnership's Incentive Share Plans. In connection with the
Recapitalization, the grants under the Partnership's Incentive Share Plans,
as adjusted for the one and one half conversion of partnerships units,
became grants to acquire Class A Common Stock.

The Plan permits the grant of management options, discretionary options,
and investment shares. The Plan is administered by the Compensation
Committee of the Board of Directors which consists of non-employee
directors. Management options are granted to selected management optionees
to acquire shares of the Company's Class A Common Stock at an exercise
price of $.01 per share. The number of shares subject to each option shall
be determined by the Committee based on the salary of each elected
management optionee, taking into consideration job performance criteria,
divided by the fair market value of shares of Class A Common Stock as of
January 1 of each year. Vesting shall be over a five year period.

The Committee may also grant to eligible employees discretionary options to
acquire shares of Class A Common Stock upon such terms and conditions,
including exercise price, as the Committee shall determine.

Information related to the options granted under the Equity Plan is as
follows:

<TABLE>                                                        
<CAPTION>
                                                                 Weighted
                                                                 Average
                                              Option             Exercise
                               Shares          Price              Price
<S>                           <C>               <C>           <C>
Outstanding at
 December 31, 1994                 -               -                   -
Granted upon
 conversion of incentive 
 plans to Class A
 Common Stock options         310,871           $ .01         $  .01
Granted upon conversion
 of Class B 
 partnership unit 
 options to Class A 
 Common Stock options         682,383 <F1>      $ 2.00-14.00  $ 6.47
Granted                        10,422           $  .01        $  .01
Canceled                         (999)          $  .01        $  .01
Exercised                      -                     -             -
                         -----------        ------------        --------
Outstanding at 
 December 31, 1995          1,002,677           $  .01-14.00   $ 4.40     
Granted                       403,729           $  .01-25.56   $13.15
Canceled                      (10,749)          $  .01-20.00   $ 2.19
Exercised                    (264,530)          $  .01-20.00   $ 2.45
                        ----------         ------------        --------
Outstanding at
 December 28, 1996          1,131,127           $  .01-25.56   $ 8.00
<FN>
<F1> This amount represents options to purchase partnership units which were 
     outstanding prior to the Recapitalization of the Company in November 
     1995. Compensation expense on these partnership units would have been
     reflected in fiscal 1994 and as result, there is no pro forma
     compensation expense recognized in fiscal 1995 related to these shares.
</FN>   
</TABLE>



As of December 28, 1996, 579,341 stock options were exercisable.

<PAGE>
                    THE BOSTON BEER COMPANY, INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                            (Continued)
J. Common Stock (continued):

Stock Compensation Plan (continued):
The Equity Plan also permits Company employees who have been with the
Company for at least one year to invest up to ten percent of their annual
earnings in Class A Common Stock ("Investment Shares"). The price at which
Investment Shares are issued to participating employees is at a discount
from current market value of from 0% to 40% based on the employee's tenure
with the Company. These shares vest ratably over a five year period. At
December 28, 1996 and December 31, 1995, there were 66,249 and 67,731
investment shares issued and outstanding, of which 55,269 and 40,134
shares were vested.

Prior to the Recapitalization, the Partnership had various other employee
investment unit plans in which eligible employees could purchase the
economic equivalent of partnership units at not less than 60% of the unit
value. The total expense recognized for the years ended December 31, 1995
and 1994, approximated $20,000 representing all discount amortized over the
related vesting period.

Upon Recapitalization, the investment units were replaced with 67,731
investment shares. Effective with the issuance of the shares, approximately
$411,000 of the investment unit plan accrued liability recorded was
reclassified as equity in consideration of the stock issued.

The Company has reserved 235,594 and 1,687,500 shares of Class A Common Stock 
for issuance pursuant to the Equity Plan as December 28, 1996 and December 
31, 1995, respectively.grant.

In October 1995, the FASB issued SFAS 123, "Accounting for Stock-Based
Compensation." SFAS is effective for periods beginning after December 15,
1995. The Company adopted the disclosure provisions of SFAS 123 in 1996 and
has applied APB Opinion 25 and related Interpretations for its stock option
plan. Had compensation cost for the Company's stock-based compensation
plans been determined based on the fair value at the grant dates as
calculated in accordance with SFAS 123, the Company's net income and
earnings per share for the years ended December 28, 1996 and December 31,
1995 would have been reduced to the pro forma amounts indicated below:


<TABLE>
                             (in thousands, except per share amounts)
<CAPTION>
                            1996                          1995
                                  Earnings Per                     Earnings Per
                   Net Income         Share           Net Income       Share   
<S>               <C>               <C>             <C>                <C>
As Reported       $  8,385          $ 0.41          $  5,896 <F1>      $ 0.33  

Pro forma         $  8,305          $ 0.41          $  5,896           $ 0.33

<FN>
<F1> Pro forma, see Note B.
</TABLE>

 
The fair value of each stock option is estimated on the date of grant using
the Black-Scholes option-pricing model with the following weighted average
assumptions: an expected life of from 5.5 years to 6.5 years for stock 
options, expected volatility of 45%, a dividend yield of 0%, and a risk-free 
interest rate that ranges from 5.43% to 7.79%, depending upon the term of 
the respective stock options. The weighted average fair value of stock options
granted in 1996 and 1995 was $7.06 and $19.80, respectively.

Because some options vest over several years and additional awards may be made
each year, the pro-forma amounts above may not be representative of the 
effects on net income for future years.

<PAGE>
                        THE BOSTON BEER COMPANY, INC.
                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

J.  Common Stock (continued):

Stock-Based Compensation (continued):
In 1996, there 10,000 options granted with an exercise price that exceeded
fair value. The weighted average of these grants was $25.56. In 1996, net of
forfeitures, there were 8,729 options granted with an exercise price of less
than fair value, and the weighted average exercise price of these grants was 
$4.82. In 1995, there were 321,293 options granted with an exercise price 
less than fair value, and the weighted average exercise price of these
grants was $.01.

The following table summarizes information about stock options outstanding
at December 28, 1996:


<TABLE>

               Options Outstanding                        Options Exercisable
<CAPTION>                              
                              Weighted-Average
                                  Remaining
Range of          Number         Contractual       Weighted-Average    Number        Weighted-Average
Exercise Prices   Outstanding      Life              Exercise-Price    Exercisable    Exercise Price
<S>                <C>             <C>                <C>                <C>            <C>          
$  .01-$ 2.00        485,744        5 years           $  1.01            439,043        $  .59
$ 9.00-$14.00        590,383       11 years           $ 12.41            148,472        $11.51
$18.00-$26.00         55,000        9 years           $ 21.16             16,666        $19.41
                   ---------                                            ----------
   Total           1,131,127                                             604,181
                   =========                                            ==========
</TABLE>

Under the restricted stock plan, grants were made during 1996 and 1995. 
The shares granted for these years were 2,577 and 34,658, respectively.  
The weighted average grant prices for grants made in 1996 and 1995 were
$15.26 and $8.90, respectively. As of December 28, 1996 and December 31,
1995, the number of restricted shares was 16,399 and 26,584, respectively.

The Company recognized compensation expense of $186,000 and $250,000 under
the described programs for the years ending December 28, 1996 and 
December 31, 1995, respectively.

K.       Financial Instruments

During 1996, the Company entered into a forward exchange contract to reduce
exposure to currency movements affecting existing foreign currency
denominated assets, liabilities, and firm commitments. The contract
duration matches the duration of the currency position. The future value of
the contract and the related currency position is subject to offsetting
market risk resulting form foreign currency exchange rate volatility. The
carrying amounts of the contract and the unrealized gain recognized as a
component of Stockholders' Equity totaled $1,195,000 and $31,070,
respectively, at December 28, 1996. There were no realized gains or losses
on the contract as of December 28, 1996.

L.      Related Party Transactions:

At December 31, 1995, borrowings of $150,000 under a recourse note due on
December 31, 1997 from the Company's Chief Operating Officer were
outstanding. The note bears interest based on the applicable federal rate.
This note was repaid in its entirety during 1996.

The Company has a deferred compensation agreement with its Chief Operating
Officer which calls for specific payments upon retirement on or after April
1, 2000 with pro-rated annual payments called for upon early retirement.
The Company has expensed approximately $59,000, $56,000, and $49,000 for
the three years ended December 28, 1996, December 31, 1995 and 1994,
respectively.

<PAGE>
                   THE BOSTON BEER COMPANY, INC.
              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                       (Continued):

M.     401 (k) Savings Plan:

During 1993, the Company established the Boston Beer Company 401(k) Savings
Plan (the "Plan"). The Plan is a defined contribution plan which covers
substantially all of the Company's employees. Participants may make
voluntary contributions of their annual compensation.

The Company made contributions to the Plan in each of the three years ended
December 28, 1996, December 31, 1995, and 1994 of $280,000, $175,000, and
$142,000 respectively.

N.      Sale of Distribution Rights:

In September 1995, the Company sold its distribution rights to a major
metropolitan area and associated receivables and inventories for
approximately $1,200,000 and the assumption of certain deposit liabilities
and truck leases. On closing approximately $420,000 was paid in cash with
the remainder in the form of a note which is payable in equal monthly
installments of $13,000 plus interest at 10% per annum. This transaction
resulted in a gain to the Company of approximately $807,000 and is included
in other income. The sale of the distribution rights is not expected to
result in any significant change in future operations of the Company when
compared to historical results.

O.      Subsequent Event

Effective March 1, 1997, the Company acquired all of the equipment and
other brewery-related personal property from the Schoenling Brewing Company
and leased the real estate on which the brewery is situated.  In addition,
subject to the satisfaction of certain pre-conditions, the Company has
agreed to purchase the real estate on which the brewery is located. The
acquisition of the brewery assets and real estate will be accounted for
under the purchase method of accounting. The purchase price allocation has
not yet been determined.


P.      Valuation and Qualifying Accounts:

The information required to be included in Schedule II, Valuation and
Qualifying Accounts, for the years ended December 31, 1994, 1995, and
December 28, 1996 is as follows:

                                         Additions
                            Balance at   Charged to    Net          Balance
                            Beginning    Costs and     Additions     At End
                            of Period    Expenses    (Deductions)  of Period
                                      (in thousands)
Allowance for 
 Doubtful Accounts          
   1994                     $  146            47         (11)          182
   1995                        182           107        (114)          175
   1996                        175         1,832         (77)        1,930


Inventory Reserves
   1994                    $   457           381        (590)          248
   1995                        248           782      (1,014)           16
   1996                         16         2,860        (386)        2,490

Deductions from allowance for doubtful accounts represent the write-off of
uncollectible balances whereas deductions from inventory reserves represent
inventory destroyed in the normal course of business.

<PAGE>


I
tem 9.     Changes in and Disagreements with Accountants on Financial
             Disclosures

            None.




                         PART III


Item 10.   Director and Executive Officers of the Registrant

           The information required by Item 10 is hereby incorporated by
           reference from the Registrant's definitive Proxy Statement for
           the 1997 Annual Meeting to be held on June 3, 1997.


Item 11.   Executive Compensation

           The information required by Item 11 is hereby incorporated by
           reference from the Registrant's definitive Proxy Statement for
           the 1997 Annual Meeting to be held on June 3, 1997.


Item 12.   Security Ownership of Certain Beneficial Owners and Management

          The information required by Item 12 is hereby incorporated by
          reference from the Registrant's definitive Proxy Statement for
          the 1997 Annual Meeting to be held on June 3, 1997.


Item 13.  Certain Relationships and Related Transactions

          The information required by Item 13 is hereby incorporated by
          reference from the Registrant's definitive Proxy Statement for
          the 1997 Annual Meeting to be held on June 3, 1997.



Item 14.  Exhibits, Financial Statement Schedules, and Reports on Form
           8-K

          (a)(1) Consolidated Financial Statements

          The following consolidated financial statements of The Boston
          Beer Company, Inc. are included in Item 8 of Part II of this
          report:

               Report of Independent Accountants on page 19 of this report

               Consolidated Balance Sheets at December 28, 1996 and
                December 31, 1995 on page 20 of this report

               Consolidated Statements of Income for the Years Ended
                December 28, 1996, December 31, 1995, and December 31, 
                1994 on page 21 of this report

               Consolidated Statements of Stockholders' Equity for the
                Years Ended December 28, 1996, December 31, 1995, and
                December 31, 1994 on page 22 of this report

               Consolidated Statements of Cash Flows for the Years Ended
                December 28, 1996, December 31, 1995, and December 31,
                1994 on page 23 of this report

               Notes to Consolidated Financial Statements on pages 24 to 36
                of this report

          (a)(2)    Financial Statement Schedule

          The following financial statement schedule is included in page 36
          of this report

               Schedule II -- Valuation and Qualifying Accounts

               The Report of Independent Accountants is included on page 19
                of this report.

               All other schedules for which provision is made in
                Regulation S-X of the Securities and Exchange Commission, 
                are not required under the related instructions or are not
                applicable and, therefore, have been omitted.


          (a)(3)    Exhibits

          The following is a list of exhibits filed as part of this report:

               Exhibit No.                   Title

                     3.1      Articles of Organization (incorporated
                              by reference to Exhibit 3.2 to the Company's
                              Registration Statement No. 33-96162).

                     3.2      By-Laws of the Company (incorporated by
                              reference to Exhibit 3.2 to the Company's
                              Registration Statement No. 33-96162).

                     3.3      Restated Articles of Organization of the
                              Company.

                     3.4      Amended and Restated By-Laws of the Company.

                     4.1      Form of Class A Common Stock Certificate
                              (incorporated by reference to Exhibit 4.1 to
                              the Company's Registration Statement No. 
                              33-96164).

                    10.1      Revolving Credit Agreement between Fleet Bank
                              of Massachusetts, N.A. and Boston Beer Company
                              Limited Partnership (the "Partnership"), dated 
                              as of May 2, 1995 (incorporated by reference 
                              to Exhibit 10.2 to the Company's Registration
                              Statement No. 33-96162).

                    10.2      Loan Security and Trust Agreement, dated
                              October 1, 1987, among Massachusetts Industrial
                              Finance Agency, the Partnership and The First 
                              National Bank of Boston, as Trustee, as amended 
                              (incorporated by reference to Exhibit 10.2 to 
                              the Company's Registration Statement 
                              No. 33-96164).

                    10.3      Deferred Compensation Agreement between the
                              Partnership and Alfred W. Rossow, Jr., effective
                              December 1, 1992 (incorporated by reference to 
                              Exhibit 10.3 to the Company's Registration 
                              Statement No. 33-96162).


                    10.4      The Boston Beer Company, Inc. Employee Equity
                              Incentive Plan, as adopted effective November 
                              20, 1995 and amended effective February 23, 1996 
                              (incorporated by reference to Exhibit 4.1 to the 
                              Company's Registration Statement No. 333-1798).

                    10.5      Form of Employment Agreement between the 
                              Partnership and employees (incorporated by 
                              reference to Exhibit 10.5 to the Company's 
                              Registration Statement No. 33-96162).

                    10.6      Services Agreement between The Boston Beer 
                              Company, Inc. and Chemical Mellon Shareholder 
                              Services, dated as of October 27, 1995.

                    10.7      Form of Indemnification Agreement between the
                              Partnership and certain employees and Advisory
                              Committee members (incorporated by reference to 
                              Exhibit 10.7 to the Company's Registration 
                              Statement No. 33-96162).

                   10.8       Stockholder Rights Agreement, dated as of 
                              December, 1995, among The Boston Beer Company,
                              Inc. and the initial Stockholders.

                  +10.9       Agreement between Boston Brewing Company, Inc. 
                              and The Stroh Brewery Company, dated as of 
                              January 31, 1994 (incorporated by reference 
                              to Exhibit 10.9 to the Company's Registration 
                              Statement No. 33-96164).

                  +10.10      Agreement between Boston Brewing Company, Inc. 
                              and the Genesee Brewing Company, dated as of
                              July 25, 1995 (incorporated by reference to 
                              Exhibit 10.10 to the Company's Registration 
                              Statement No. 33-96164).

                  +10.11      Amended and Restated Agreement between Pittsburgh
                              Brewing Company and Boston Brewing Company, Inc. 
                              dated as of February 28, 1989 (incorporated by 
                              reference to Exhibit 10.11 to the Company's 
                              Registration Statement No. 33-96164).

                   10.12      Amendment to Amended and Restated Agreement
                              between Pittsburgh Brewing Company, Boston
                              Brewing Company, Inc., and G. Heileman Brewing
                              Company, Inc., dated December 13, 1989 
                              (incorporated by reference to Exhibit 10.13 to
                              the Company's Registration Statement 
                              No. 33-96162).

                  +10.13      Second Amendment to Amended and Restated
                              Agreement between Pittsburgh Brewing Company
                              and Boston Brewing Company, Inc. dated as 
                              of August 3, 1992 (incorporated by reference 
                              to Exhibit 10.13 to the Company's Registration 
                              Statement No. 33-96164).

                  +10.14      Third Amendment to Amended and Restated
                              Agreement between Pittsburgh Brewing Company
                              and Boston Brewing Company, Inc. dated 
                              December 1,1994 (incorporated by reference to 
                              Exhibit 10.14 to the Company's Registration 
                              Statement No. 33-96164).

                   10.15      Fourth Amendment to Amended and Restated
                              Agreement between Pittsburgh Brewing Company
                              and Boston Brewing Company, Inc. dated as of 
                              April 7,1995 (incorporated by reference to 
                              Exhibit 10.16 to the Company's Registration 
                              Statement No. 33-96162).

                  +10.16      Letter Agreement between Boston Beer Company
                              Limited Partnership and Joseph E. Seagram & 
                              Sons, Inc. (incorporated by reference to 
                              Exhibit 10.17 to the Company's Registration 
                              Statement No. 33-96162).

                   10.17      Services Agreement and Fee Schedule of Mellon
                              Bank, N.A. Escrow Agent Services for The Boston
                              Beer Company, Inc. dated as of October 27, 1995).

                   10.18      Amendment to Revolving Credit Agreement
                              between Fleet Bank of Massachusetts, N.A. and 
                              the Partnership (incorporated by reference to 
                              Exhibit 10.17 to the Company's Registration 
                              Statement No. 33-96164).

                  *10.19      1996 Stock Option Plan for Non-Employee 
                              Directors.

                 *+10.20      Production Agreement between The Stroh Brewery 
                              Company and Boston Beer Company Limited 
                              Partnership, dated January 14, 1997.

                 *+10.21      Letter Agreement between The Stroh Brewery
                              Company and Boston Beer Company Limited
                              Partnership, dated January 14, 1997.

                 *+10.22      Agreement between Boston Beer Company Limited
                              Partnership and The Schoenling Brewing Company,
                              dated May 22, 1996.

                   11         Schedule of Computation of Pro Forma Earnings
                              Per Share.

                  *21.1       List of subsidiaries of The Boston Beer
                              Company, Inc.

                   23.1       Consent of Coopers and Lybrand L.L.P.,
                              independent accountants with respect to the
                              Partnership, as Exhibit 24 to this report).

                         * Filed with this report.

                         + Portions of this Exhibit have been omitted
                           pursuant to an application for an order
                           declaring confidential treatment filed with 
                           the Securities and Exchange Commission.

                                                      
          (b)  Reports on Form 8-K

                            UNITED STATES
                    SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549


                              FORM 8-K
                             CURRENT REPORT

        Pursuant to Section 13 or 15(d) of the Securities and
         Exchange Act of 1934

 Date of Report        December 24, 1996

                         THE BOSTON BEER COMPANY, INC.
  (Exact name of registrant as specified in its charter)

     Massachusetts            01-14092            04-3284048
     (State or other      (Commission File     (I.R.S. Employer
      Jurisdiction of         Number)       Identification Number)
      Incorporation)

                   75 Arlington Street, Boston Massachusetts 02116
      (Address of principal executive offices)    (Zip Code)

     Registrant's telephone number, including area code (617) 368-5000


     Item 8.        Change in Fiscal Year

     On December 20, 1996, the Registrant's Board of Directors formally
approved a change in Registrant's fiscal year, commencing with fiscal year
1996, such that Registrant's fiscal year shall henceforth end on the
Saturday of the last full calendar week in December in each year, rather
than on December 31, and shall consist of 52 weeks, except that in every
fifth year the fiscal year shall consist of 53 weeks. No transition period
will result from the change.


                         SIGNATURES

     Pursuant to the requirements of the Securities and Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.


                         THE BOSTON BEER COMPANY, INC.
                         (Registrant)

Date:  December 24, 1996                /s/ ALFRED W. ROSSOW, JR.
                              Chief Operating Officer, Treasurer,
                              Chief Financial Officer (principal financial
                              and accounting officer) and Director



<PAGE>


                         SIGNATURES


     Pursuant to the requirements of Section 13 or 15(d) of the Securities
and Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized, on this
27th of March, 1997.




                                   THE BOSTON BEER COMPANY, INC.

                                   /s/ C. JAMES KOCH
                                   -------------------------------------
                                   C. James Koch
                                   President


     Pursuant to the requirements of the Securities and Exchange Act of
1934, this report has been signed by the following persons in the
capacities and on the dates indicated.


     Signature                Title                    Date


     /s/ C. JAMES KOCH            President, Chief Executive Officer,
                                  Clerk and Director (principal
                                  executive officer)

     /s/ ALFRED W. ROSSOW, JR.    Chief Operating Officer, Treasurer,
                                  Chief Financial Officer (principal
                                  financial and accounting officer)
                                  and Director

     /s/ RHONDA L. KALLMAN        Director


     /s/ CHARLES JOSEPH KOCH      Director

     /s/ PEARSON C. CUMMIN, III   Director

         James C. Kautz           Director

     /s/ JOHN B. WING             Director






                THE BOSTON BEER COMPANY, INC.
                              
                   1996 STOCK OPTION PLAN
                 FOR NON-EMPLOYEE DIRECTORS


     1.   PURPOSE

     The purpose of The Boston Beer Company, Inc. 1996 Stock

Option  Plan for Non-Employee Directors (the "Plan")  is  to

attract   and   retain  the  services  of  experienced   and

knowledgeable  independent Directors who are  not  employees

("Non-Employee Directors") of The Boston Beer Company,  Inc.

("Boston  Beer")  for  the benefit of Boston  Beer  and  its

stockholders  and to provide additional incentive  for  Non-

Employee Directors to continue to work in the best interests

of  Boston  Beer  and  its stockholders  through  continuing

ownership of Boston Beer common stock.

     2.   SHARES SUBJECT TO THE PLAN

     The total number of shares of Class A Common Stock, par

value  $.01 per share ("Shares"), of Boston Beer  for  which

options  may  be  granted under the Plan  shall  not  exceed

100,000   in   the  aggregate,  subject  to  adjustment   in

accordance with Section 9 hereof.

     3.   ELIGIBILITY; GRANT OF OPTION

      Each of Pearson C. Cummin III, James C. Kautz, Charles

Joseph  Koch  and  John B. Wing, who are  the  four  current

members  of  the  Board of Directors  of  Boston  Beer  (the

"Board") who are not otherwise employees of Boston  Beer  or

any  subsidiary and who were reelected as Directors  at  the

Boston  Beer Annual
 Meeting held on May 21, 1996,  shall  be

granted  an  option  to  acquire two thousand  five  hundred

(2,500) Shares under the Plan upon the adoption of the  Plan

by  the Board and shall be granted a further option for  two

thousand  five  hundred (2,500) Shares upon each  subsequent

reelection  to  the  Board.  All new Non-Employee  Directors

duly  elected in the ten year period commencing on the  date

of  the adoption of the Plan, shall be granted an option  to

acquire  two thousand five hundred (2,500) Shares under  the

Plan  upon  their  election  to  the  Board  and  upon  each

subsequent  reelection.  The date of grant for such  options

granted  to  the  four current Non-Employee Directors  named

above  shall  be  the date of adoption of the  Plan  by  the

Board,  but such options shall become effective as  of  such

date  of grant only upon approval of the Plan by the holders

of Boston Beer's issued and outstanding Class B Common Stock

in accordance with Section 13 hereof.  The date of the first

grant  for  each subsequently elected Non-Employee  Director

shall  be  the  date  of  election.  The  options  shall  be

non-qualified options not intended to meet the  requirements

of  Section  422 of the Internal Revenue Code  of  1986,  as

amended (the "Code").

     4.   OPTION AGREEMENT

      Each  option granted under the Plan shall be evidenced

by  an  option agreement (the "Agreement") duly executed  on

behalf  of  Boston Beer and by the Non-Employee Director  to

whom  such  option  is  granted.  Each Agreement  shall  (i)

comply  with  and be subject to the terms and conditions  of

the  Plan, (ii) provide that the optionee agrees to continue

to  serve  as a Director of Boston Beer during the term  for

which  he  or she was elected and (iii) contain  such  other

provisions not inconsistent with the provisions of the Plan,

including  with respect to obligations of each  Non-Employee

Director  not to compete with Boston Beer, as the Board  may

determine.

     5.   OPTION EXERCISE PRICE

      Subject  to  the provisions of Section 9  hereof,  the

option  exercise price for options granted  under  the  Plan

shall be the fair market value of the Shares covered by  the

option on the date of grant of the option.  For the purposes

hereof  and of Section 6(b), the fair market value of Shares

shall  be the mean between the high and low sales prices  of

the  Class  A  Common Stock of Boston Beer on the  New  York

Stock  Exchange as reported in the Wall Street  Journal  for

the date of grant, provided that if the Class A Common Stock

of  Boston Beer is not listed on or actually trading on  the

New  York  Stock  Exchange,  fair  market  value  shall   be

determined in good faith by the Board.

     6.   TIME AND MANNER OF EXERCISE OF OPTION

      (a)  Options granted under the Plan shall, subject  to

the  provisions of Section 7, be immediately exercisable  in

full;  provided, however, that no option granted  under  the

Plan  may be exercised prior to approval of the Plan by  the

holders  of  Boston  Beer's issued and outstanding  Class  B

Common Stock, as required by Section 13.

     (b)  The option may be exercised in full at one time or

in part from time to time by giving written notice to Boston

Beer, signed by the person or persons exercising the option,

stating  the  number  of Shares with respect  to  which  the

option  is being exercised, accompanied by payment  in  full

for such Shares, which payment may be in cash or in whole or

in part in Shares of the Class A Common Stock of Boston Beer

already  owned  for a period of at least six months  by  the

person  or  persons exercising the option,  valued  at  fair

market  value, as determined under Section 5 hereof, on  the

date of exercise; provided, however, that there shall be  no

such  exercise at any one time as to fewer than two  hundred

fifty  (250)  Shares  or  all of the remaining  Shares  then

purchasable by the person or persons exercising the  option,

if  fewer  than two hundred fifty (250) Shares.   Upon  such

exercise,   delivery   of   a   certificate   for    paid-up

non-assessable  Shares  shall  be  made  at  the   principal

Massachusetts office of Boston Beer to the person or persons

exercising the option at such time, during ordinary business

hours,  not  more  than thirty (30) days from  the  date  of

receipt  of  the  notice  by  Boston  Beer  ,  as  shall  be

designated in such notice, or at such time, place and manner

as  may  be  agreed upon by Boston Beer and  the  person  or

persons exercising the option.

     7.   TERM OF OPTIONS

      (a)  Each option shall expire ten (10) years from  the

date  of  the  granting thereof, but  shall  be  subject  to

earlier termination as herein provided.

      (b)   In  the  event of the death of an optionee,  the

option  granted  to such optionee may be  exercised  by  the

estate  of  such  optionee or by any person or  persons  who

acquired  the  right to exercise such option by  bequest  or

inheritance  or  otherwise by reason of the  death  of  such

optionee.   Such option may be exercised at any time  within

one  (1)  year after the date of death of such optionee,  at

which time the option shall terminate, or prior to the  date

on   which  the  option  otherwise  expires  by  its  terms,

whichever is earlier.

      (c)   In  the event that an optionee ceases  to  be  a

Director  of Boston Beer the option granted to such optionee

may  be  exercised by him or her, any time within three  (3)

months  after the date such optionee ceases to be a Director

of  Boston  Beer, at which time the option shall  terminate,

but  in  any  event  prior to the date on which  the  option

expires   by   its  terms,  whichever  is  earlier,   unless

termination as a Director (i) was by Boston Beer for  cause,

in  which case the option shall terminate immediately at the

time the optionee ceases to be a Director of Boston  Beer  ,

(ii)  was  because the optionee has become disabled  (within

the  meaning of Section 22(e)(3) of the Code), or (iii)  was

by  reason  of the death of the optionee.  In  the  case  of

death,  see  Section 7(b) above.  In the case of disability,

the  option may be exercised at any time within one (1) year

after the date of termination of the optionee's directorship

with  Boston Beer, at which time the option shall terminate,

but  in  any  event  prior to the date on which  the  option

otherwise expires by its terms, whichever is earlier.

     8.   OPTIONS NOT TRANSFERABLE

     The right of any optionee to exercise an option granted

to  him  or  her  under the Plan shall not be assignable  or

transferable by such optionee otherwise than by will or  the

laws of descent and distribution, or pursuant to a qualified

domestic relations order as defined by the Code or  Title  I

of the Employee Retirement Income Security Act, or the rules

thereunder.   Any  option granted under the  Plan  shall  be

exercisable during the lifetime of such optionee only by him

or her.  Any option granted under the Plan shall be null and

void and without effect upon the bankruptcy of the optionee,

or  upon  any  attempted assignment or transfer,  except  as

herein  provided, including without limitation any purported

assignment,  whether  voluntary  or  by  operation  of  law,

pledge,  hypothecation  or  other  disposition,  attachment,

trustee  process  or  similar  process,  whether  legal   or

equitable, upon such option.

     9.   ADJUSTMENTS UPON CHANGES IN CAPITALIZATION

     In the event that the outstanding shares of the Class A

Common  Stock  of Boston Beer are changed into or  exchanged

for a different number or kind of shares or other securities

of  Boston Beer or of another corporation by reason  of  any

reorganization,   merger,  consolidation,  recapitalization,

reclassification, stock split-up, combination of  shares  or

dividends  payable in capital stock, appropriate  adjustment

shall  be made in the number and kind of shares as to  which

outstanding  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, and such adjustment in outstanding

options  shall  be made without change in  the  total  price

applicable  to the unexercised portion of such  options  and

with  a  corresponding adjustment in the  option  price  per

share.

     10.  RESTRICTIONS ON ISSUE OF SHARES

      Notwithstanding  the provisions of Section  6  hereof,

Boston Beer may delay the issuance of Shares covered by  the

exercise  of  any  option granted under  the  Plan  and  the

delivery of a certificate for such Shares until one  of  the

following conditions shall be satisfied:

           (i)   the Shares with respect to which an  option

has  been  exercised are at the time of the  issue  of  such

Shares  effectively registered under applicable Federal  and

state securities acts now in force or hereafter amended; or

           (ii)  counsel for Boston Beer shall have given an

opinion, which opinion shall not be unreasonably conditioned

or  withheld,  that such Shares are exempt from registration

under  applicable Federal and state securities acts  now  in

force or hereafter amended.

      It  is  intended that all exercises of options granted

under the Plan shall be effective.  Accordingly, Boston Beer

shall  use  its best efforts to bring about compliance  with

the  above conditions within a reasonable time, except  that

Boston  Beer  shall  be  under  no  obligation  to  cause  a

registration statement or a post-effective amendment to  any

registration statement to be prepared at its expense  solely

for  the  purpose of covering the issue of Shares in respect

of  which  any option may be exercised, except as  otherwise

agreed to by Boston Beer in writing.

          11.   RIGHTS OF HOLDER ON PURCHASE FOR INVESTMENT;
          SUBSEQUENT REGISTRATION

      Unless  the  Shares to be issued upon exercise  of  an

option   granted  under  the  Plan  have  been   effectively

registered   under   the  Securities  Act   of   1933   (the

"1933  Act"),  as now in force or hereafter amended,  Boston

Beer  shall  be  under  no obligation to  issue  any  Shares

covered  by any option unless the person who exercises  such

option,   in  whole  or  in  part,  shall  give  a   written

representation  and  undertaking to  Boston  Beer  which  is

satisfactory in form and scope to counsel to Boston Beer and

upon which, in the opinion of such counsel, Boston Beer  may

reasonably  rely,  that he or she is  acquiring  the  Shares

issued  to  him pursuant to such exercise of the option  for

his  or her own account as an investment and not with a view

to,  or for sale in connection with, the distribution of any

such Shares, and that he or she will make no transfer of the

same except in compliance with any rules and regulations  in

force  at the time of such transfer under the 1933  Act,  or

any  other  applicable law, and that if  Shares  are  issued

without  such  registration a legend to this effect  may  be

endorsed  upon the securities so issued.  In the event  that

Boston  Beer  shall,  nevertheless,  deem  it  necessary  or

desirable to register under the 1933 Act or other applicable

statutes  any  Shares with respect to which an option  shall

have  been  exercised, or to qualify  any  such  Shares  for

exemption  from  the 1933 Act or other applicable  statutes,

then  Boston Beer shall take such action at its own  expense

and  may  require  from each optionee  such  information  in

writing  for  use in any registration statement, prospectus,

preliminary prospectus or offering circular as is reasonably

necessary  for  such  purpose  and  may  require  reasonable

indemnity to Boston Beer and its Officers and Directors from

such   holder  against  all  losses,  claims,  damages   and

liabilities  arising  from such use of  the  information  so

furnished and caused by any untrue statement of any material

fact  therein or caused by the omission to state a  material

fact required to be stated therein or necessary to make  the

statements   therein  not  misleading  in   light   of   the

circumstances under which they were made.

     12.  LOANS PROHIBITED

      Boston  Beer  shall not, directly or indirectly,  lend

money to an optionee or to any person or persons entitled to

exercise an option by reason of the death of an optionee for

the  purpose of assisting any of them in the acquisition  of

Shares covered by an option granted under the Plan.

     13.  APPROVAL OF STOCKHOLDERS

       The  Plan  shall  be  subject  to  approval  by   the

affirmative vote of the holders of a majority of the  issued

and outstanding shares of the Class B Common Stock of Boston

Beer  present or represented and entitled to vote at a  duly

held stockholders' meeting, or by written consent of all  of

the  holders  of such Class B Common Stock, and  shall  take

effect  immediately  as of its date of  adoption  upon  such

approval.

     14.  EXPENSES OF THE PLAN

       All   costs   and  expenses  of  the   adoption   and

administration of the Plan shall be borne by Boston  Beer  ,

and none of such expenses shall be charged to any optionee.

     15.  TERMINATION AND AMENDMENT OF PLAN

      Unless sooner terminated as herein provided, the  Plan

shall terminate ten (10) years from the date upon which  the

Plan  was  duly  approved by the holders  of  Boston  Beer's

issued and outstanding Class B Common Stock.  The Board  may

at  any time terminate the Plan or make such modification or

amendment thereof as it deems advisable; provided,  however,

that,   except   as  provided  in  Section  9   hereof,   no

modification or amendment to the provisions of the Plan  may

be  made  more than once every six (6) months other than  to

comport  with  changes in the Code, the Employee  Retirement

Income  Security Act, or the rules thereunder, if the effect

of such amendment or modification would be to change (i) the

requirements for eligibility under the Plan, (ii) the timing

of the grants of options to be granted under the Plan or the

exercise  price  thereof,  or (iii)  the  number  of  Shares

subject  to options to be granted under the Plan  either  in

the  aggregate  or  to one Director.  Any amendment  to  the

provisions  of  the Plan which (i) materially increases  the

number  of  Shares which may be subject to  options  granted

under  the  Plan,  (ii)  materially increases  the  benefits

accruing to Non-Employee Directors under the Plan, or  (iii)

materially  modifies  the  requirement  for  eligibility  to

participate in the Plan, shall be subject to approval by the

holders  of  Boston Beer's Class B Common Stock obtained  in

the  manner stated in Section 13 hereof.  Termination or any

modification or amendment of the Plan shall not, without the

consent  of an optionee, affect his or her rights  under  an

option previously granted to him or her.

     16.  LIMITATION OF RIGHTS IN THE OPTION SHARES

     An optionee shall not be deemed for any purpose to be a

stockholder  of  Boston  Beer with respect  to  any  of  the

options except to the extent that the option shall have been

exercised   with  respect  thereto  and,  in   addition,   a

certificate shall have been issued theretofore and delivered

to the optionee.

     17.  NOTICES

     Any communication or notice required or permitted to be

given  under  the Plan shall be in writing,  and  mailed  by

registered  or certified mail or delivered by  hand,  if  to

Boston Beer , to its principal place of business, Attention:

President,  and,  if  to  an optionee,  to  the  address  as

appearing on the records of Boston Beer .

     18.  COMPLIANCE WITH RULE 16b-3.

     It is the intention of Boston Beer that the Plan comply

in  all  respects with Rule 16b-3 promulgated under  Section

16(b)   of   the  Securities  Exchange  Act  of  1934   (the

"1934  Act")  and  that  Participants  remain  disinterested

persons for purposes of administering other employee benefit

plans  of  Boston  Beer and having transactions  under  such

other  plans be exempt from Section 16(b) of the  1934  Act.

Therefore,  if  any Plan provision is found  not  to  be  in

compliance  with Rule 16b-3 or if any Plan provisions  would

disqualify   Participants   from   remaining   disinterested

persons, that provisions shall be deemed null and void,  and

in  all  events the Plan shall be construed in favor of  its

meeting the requirements of Rule 16b-3.


ADOPTED BY THE BOARD OF DIRECTORS ON MAY 21, 1996
APPROVED  BY THE SOLE HOLDER OF THE CLASS B COMMON STOCK  ON
MAY 21, 1996.
67334-1




                                        EXHIBIT 10.20
                                          *   denotes  expurgated
information
                                
                      PRODUCTION AGREEMENT
                             BETWEEN
                    THE STROH BREWERY COMPANY
                               AND
             BOSTON BEER COMPANY LIMITED PARTNERSHIP


     AGREEMENT  entered into this 14th day of January,  1997,  by
and  between  THE  STROH BREWERY COMPANY, an Arizona  corporation
("Stroh"),  and  BOSTON  BEER  COMPANY,  LIMITED  PARTNERSHIP,  a
Massachusetts  limited partnership ("Boston Beer").  Boston  Beer
and  Stroh  are  sometimes referred to herein individually  as  a
"Party" and collectively as the "Parties."

Stroh and Boston Beer are currently parties to an Agreement dated
as  of January 31, 1994, as amended, pursuant to which Stroh  has
agreed to brew, package and sell certain Boston Beer products  to
Boston  Beer  at Stroh's Allentown (Lehigh Valley),  Pennsylvania
brewery.  Stroh  also produces products for Boston  Beer  at  the
Portland,  Oregon  brewery  acquired  by  Stroh  from  G.Heileman
Brewing  Company ("Heileman") on or about June 30, 1996, pursuant
to  the December, 1995 agreement between Boston Beer and Heileman
which  was assumed by Stroh. Stroh has further agreed that  these
existing production arrangements shall remain in effect until  at
least  June 30, 1998. Stroh and Boston Beer now desire  to  enter
into a new production agreement, effective
 as of January 1, 1997,
to supersede the existing arrangements, and which will govern the
production  of products by Stroh for Boston Beer, provide  Boston
Beer  with greater control over the production process, and  give
Boston Beer access to      *      , which are the principal focus
of  this Agreement, are sometimes referred to herein individually
as  a  "Brewery"  and collectively as the "Breweries"  and  other
breweries owned by Stroh at which Beer Products may from time  to
time  be  produced are sometimes referred to individually  as  an
"Other   Brewery"   and   collectively  as  "Other   Breweries".]
Production under this Agreement shall be deemed to take effect on
the Effective Date, as defined in Section 12.

     ACCORDINGLY,  in  consideration  of  the  mutual  agreements
contained in this Agreement, the Parties, intending to be legally
bound, hereby agree as follows:

     1.   Scope of Agreement.

During the Term, as defined in Section 5, and in accordance  with
the  terms  and  conditions set forth herein,  Stroh  shall  give
Boston  Beer  access  to Stroh's production facilities  and  make
available  to Boston Beer Stroh's production personnel  to  allow
Boston  Beer to produce Boston Beer's proprietary Beer  Products.
For  purposes  of  this Agreement, Boston Beer's "Beer  Products"
shall  include Samuel Adams Boston Lager ("Samuel Adams  Lager");
Boston  Lightship Lager ("Lightship Lager"); Samuel  Adams  Cream
Stout  ("Samuel  Adams  Stout");  and  Samuel  Adams  Boston  Ale
("Samuel Adams Ale"), other products introduced under the "Samuel
Adams"  line,  all products produced and sold under  the  "Oregon
Original"  line,  certain  specially ordered  and  seasonal  malt
beverage  products  identified as such by Boston  Beer  ("Special
Orders  and  Seasonals") and such other beer products  as  Boston
Beer   may  introduce  from  time  to  time.  Boston  Beer  shall
periodically provide to Stroh an updated schedule of  all  Boston
Beer  products  which  Boston Beer deems  to  be  Beer  Products,
subject  to  this Agreement. [Boston Beer agrees,  however,  that
Stroh  need  not permit in excess of      *      wort streams  at
the       *      Brewery,      *      wort streams at the       *
Brewery, and      *      wort streams at the      *      Brewery,
except as the Parties may subsequently agree.]

     2.   Control   of   Production  of  Beer  Products:   Public
          Statements.

          (a)   All  Beer  Products shall be brewed and  packaged
according   to   Boston  Beer's  specifications,  including   the
maintenance  of  standards and quality control  programs.  Boston
Beer  shall have ultimate responsibility and authority over every
detail of the production process for Beer Products at each of the
Breweries,  with such responsibility and authority  as  to  those
parameters affecting beer taste and quality to be the same as  if
Boston Beer were the owner of the Brewery. Boston Beer shall have
the  right, at any time, to monitor and review the practices  and
procedures  of  Stroh  in the production and  packaging  of  Beer
Products and inspect each of the Breweries and any Other  Brewery
at  which  it  is proposed that Beer Products be produced.  If  a
decision  made  by Boston Beer in the exercise of  its  authority
under  this Section 2(a) results in unavoidable incremental costs
to Stroh not envisioned by the Parties in the negotiations of the
pricing  provisions  contained  in  Section  4,  Stroh  shall  be
entitled  to  be  reimbursed by Boston Beer for such  incremental
costs.  In addition, in the exercise of its authority under  this
Section  2(a),  Boston  Beer  shall not  interfere  with  Stroh's
production processes for its own proprietary brands.

          (b)   Consistent with the provisions of paragraph  (a),
Stroh and Boston Beer will,      *     .

     3.   Committed Capacity.

          (a)   Production. During the Term, Stroh shall,  except
as   otherwise  provided  herein,  make  the  following   minimum
production capacities available to Boston Beer for the production
of Beer Products
               Brewery                  Committed Capacity
                      *          *      barrels per month



                               -2
              *                  up to      *      barrels per
month through
                                 *       and up to      *
barrels
                                 per month thereafter
              *                  up to      *      barrels per
month

       The  Committed  Capacity  at  each  Brewery  is  based  on
anticipated tank usage and availability and shall be increased or
decreased in inverse proportion to the extent that actual average
tank usage varies from four and one-half weeks per storage cycle.
Boston Beer shall be under no obligation to avail itself fully of
the Committed Capacity at each Brewery in any month.  Boston Beer
will,  however,  provide  Stroh with  fifty  (50)  days'  advance
written  notice  of  any expected increase  or  decrease  in  its
expected  production requirements which varies more  than       *
from any previously submitted monthly forecasts for the period in
question,   in  order  to  allow  Stroh  to  plan  its   capacity
utilization  at  any Brewery.  Beer Products shall  primarily  be
produced in units consisting of (i) twenty-four 12-ounce  bottles
(a  "12-oz. Case Unit"), (ii) twelve 22-ounce bottles (a  "22-oz.
Case  Unit"),  (iii) 7.75 U.S. Gallons (a "Half-Keg"),  and  (iv)
15.50 U.S. gallons (a "Keg").

  (b)     Packaging.  Stroh shall use all commercially reasonable
efforts  to  accommodate Boston Beer's requested use  of  Stroh's
*       packaging facilities at the      *      Brewery for up to
*       cases of one or more beer styles per month through      *
,  for  which Stroh shall be entitled to be paid      *       per
case.

   (c)     Reallocation of Capacity. Stroh may elect to close one
or  more  of the Breweries and thereafter satisfy its obligations
under paragraph (a), above, by      *     .




                               -3-
          (d)   *      and Other Non-Stroh Breweries. Boston Beer
anticipates  entering  into  production  arrangements   for   the
production  of  Beer  Products  at  the  brewery  (the  "       *
Brewery")  in       *       owned by      *      .  Stroh  hereby
agrees that, (i) if the      *      Brewery is closed or sold and
the  buyer is unwilling to continue production arrangements  with
Boston  Beer  on terms that are acceptable to Boston Beer,  Stroh
will  make  a  like  amount of production capacity  available  to
Boston  Beer at an Other Brewery located  in       *        (a  "
*       Brewery"),  to  the extent that Stroh has  capacity  then
available  in  its  Brewery system for  Stroh's  own  proprietary
brands  which would be displaced from a      *       Brewery,  on
the  same terms and conditions as otherwise then apply hereunder;
provided that      *     , incurred by Stroh directly as a result
of  relocating the production of Stroh products from  the       *
Brewery  in question, to the extent then mutually agreed  by  the
Parties,  and  (ii) in the event that Stroh acquires  the       *
Brewery, it shall assume all then existing obligations of       *
(or any successor in interest) to Boston Beer with respect to the
production   of  Beer  Products  at  the        *        Brewery.
Similarly, Stroh hereby agrees that it will assume all production
obligations  to  Boston  Beer, if any,  of  any  other  breweries
hereafter acquired by Stroh. Notwithstanding the foregoing, Stroh
shall  be  relieved of its obligations under clause (i)  of  this
paragraph (d) to the extent that compliance in full would require
it  to  keep in operation any brewery that it would otherwise  in
the normal course of managing its business elect to close.

               4.   Price and Manner of Payment.

          (a)   Boston Beer shall pay Stroh for Beer Products  an
amount  (the "Price") equal to the sum of (i) a processing charge
(the "Fixed Charge") of      *     .

          (b)   The  Price  is  F.O.B. the  carrier's  trucks  at
Stroh's  dock  (i.e., the Price includes the  cost  and  risk  of
loading  trucks  at Stroh's dock) and includes  labor,  overhead,
profit,  and  other costs incurred in the production of  packaged
Beer Products suitable for shipment by truck.


                               -4-
     (c)   The Price excludes any federal and state excise taxes,
which  Stroh  may pass along to Boston Beer, if Stroh  pays  such
taxes  in  compliance with Federal and state laws.  In  addition,
Stroh shall be entitled to      *     , at a rate equal to      *
 .

     (d)   The  Price also excludes any charge for Boston  Beer's
use of pallets owned by Stroh. Stroh shall invoice Boston Beer on
a  quarterly basis within thirty (30) days after the end of  each
calendar  quarter for Boston Beer's proportionate share based  on
pallets  shipped) of the cost of pallets incurred at each Brewery
during  such prior calendar quarter. Such invoices shall be  paid
by Boston Beer promptly in the ordinary course.

     (e)   Stroh will invoice Boston Beer daily for the Price  of
Beer  Products shipped on the previous day and Boston Beer  shall
pay  such  invoices on Friday of each week for the  prior  week's
invoices by wire or other mutually agreed upon method. All  other
amounts  otherwise chargeable to Boston Beer hereunder  shall  be
invoiced  by Stroh reasonably promptly in accordance with  normal
business  practices  following the month  in  which  incurred  by
Stroh.  Such  timely invoices shall similarly be paid  by  Boston
Beer  promptly in the ordinary course in accordance  with  normal
business practices.

     (f)   Stroh  shall  have the right  to       *      .  Other
pricing  and payment terms for Special Orders or Seasonals  shall
be in accordance with the foregoing provisions of this Section 4,
including the timely invoicing requirements of paragraph (e).

     (g)  Boston Beer shall be entitled to      *     .

     (h)   Boston  Beer  shall  also  be  entitled  to  a       *
contemplated by Section 12 hereof, if made by Boston Beer.
     
    5.   Term.

      The  term of this Agreement (the "Term") shall commence  on
January 1, 1997 and continue until terminated pursuant to Section
6 hereof.  The Parties acknowledge that either Party's obligtions
pursuant to this Agreement to make paymets to the other Party and
the  Parties respective obligations under Sections 6(c),  13  and
14,  and  Stroh's  obligations under Sections  12  and  28  shall
survive the termination of this Agreement.

               6.   Termination.

   (a)      Except as the Parties may then otherwise  agree,  the

Term  shall expire on June 30, 1998 in the event that Boston Beer

elects not to make the Investment.



           (b)  Either Party may terminate this Agreement for any
reason whatsoever on not less than twenty-four (24) months' prior
written  notice to the other Party, effective at any time  on  or
after      *     .

          (c)  Boston Beer may also terminate this Agreement effective
immediately  upon written notice in the event that  Stroh  is  in
default  of any of its obligations to brew, package and ship  any
Beer  Products, which default continues for a period of ten  (10)
business  days following receipt by Stroh of written notice  from
Boston   Beer  regarding  such  default.  [Such  a   default   is
hereinafter  referred to as a "Stroh Production Default".)  Stroh
shall  not  be  deemed  to be in default of its  obligations  for
purposes  of  this  Section 6(c), if it is  in  good  faith  both
seeking  to correct the circumstances giving rise to its  failure
to  brew,  package  and  ship  Beer Products'  and  honoring  its
obligations under Section 13 hereof, to the extent applicable.

          (d)  Stroh may terminate this Agreement on thirty (30) days
prior  written  notice to Boston Beer, in the event  that  Boston
Beer  is in arrears in payment of undisputed amounts representing
in  excess  of one (1) month's production and such arrearage  has
remained outstanding for in excess of one (1) month after written
demand for payment was made by Stroh. Normal credit terms are  as
defined in Section 4(e).

          (e)  Stroh may also terminate this Agreement on thirty-six
(36) months' prior written notice, in the event of      *     .

          (f)  Upon termination of this Agreement, Boston Beer shall
(i)  promptly  pay to Stroh all unpaid invoices in full  and  all
unpaid costs incurred by Stroh pursuant to this Agreement in  the
brewing,  packaging, shipping and storage of Beer  Products,  and
(ii) purchase from Stroh at Stroh's cost all Stroh's inventory of
(i)  work in process of Beer Products, (ii) ingredients  and  raw
materials  unique  to  the  Beer Products,  and  (iii)  Packaging
Materials.   Stroh  will use all reasonable efforts  to  minimize
such  costs upon termination and Boston Beer will have the  right
to review documentation evidencing such costs.

                               -6-
                                
                    7.   Packaging. Deposits. and Minimum Orders.

     (a)   Packaging  of  Beer Products shall consist  of  twelve
ounce  (12 oz.) bottles, twenty-two ounce (22 oz.) bottles, Half-
Kegs  and Kegs, and such other units as Boston Beer may from time
to  time require, exclusive of any units which are proprietary to
Stroh  and which are not then being produced for Boston  Beer  by
Boston Beer or any third party. In that regard, Stroh agrees that
Boston  Beer  may  make use of      *     . Except  for  one  way
pallets paid for by Boston Beer, a deposit per pallet and per keg
as  set  forth in Section 4(a) hereof shall be charged to  Boston
Beer  with  corresponding credit applied upon the safe return  in
good  working order of the pallets or kegs to Stroh. Boston  Beer
shall  also,  at  Stroh's  request,       *       to  the  extent
necessary  as  a  result of Stroh shipping Beer Products  to  the
*       from  the      *      Brewery. Boston Beer has the right,
subject  to  the approval of Stroh, which approval  will  not  be
unreasonably withheld, to make changes in the packaging  used  to
produce  the  Beer Products or the Seasonals, including  but  not
limited to the packaging of the Beer Products or Seasonals in can
units.  The  price  for       *       will  be  adjusted  by  the
difference in costs between      *     .

     (b)  Boston Beer shall order at any given time not less than
one   production  run  (at  present       *      ).  Boston  Beer
acknowledges and agrees that the minimum order applies to       *
;  provided, however, that orders for the      *      of the Beer
Products       *      , except that for      *       bottles,  an
order may be comprised of as many as      *     .

                    8.   Packaging Material and Hops.

      Crowns,  bottles, labels, six-packs, cases, partitions  and
other   packing   materials  for  Beer   Products   (collectively
"Packaging Materials"), or any applicable federal or state  taxes
(but  specifically excluding any taxes in the nature of a tax  on
income or profits) are not included in the Fixed Charge and shall
be  borne  directly by Boston Beer.  All Packaging Materials  and
all  hops  to  be  used in the brewing of Beer Products  ("Hops")
shall  be  (i) purchased directly by Boston Beer at its cost  for
delivery  to  Stroh, (ii) the property solely and exclusively  of
Boston Beer, and (iii) segregated and identified as such.  Boston
Beer  shall  be  responsible for the storage of  Hops  and  shall
release Hops to Stroh for production on a bi-weekly basis.  Stroh
acknowledges that Boston Beer shall be afforded unrestricted  24-
hour  access to all Packaging Materials and Hops when under Stroh
control  for  purposes  of  removal or  otherwise.   Delivery  of
Packaging Materials and Hops (on such bi-weekly basis)  to  Stroh
shall be coordinated between Stroh and Boston Beer, provided that
Stroh shall be ultimately responsible for coordinating the timely
delivery  of  Packaging  Materials and Hops  to  the  appropriate
Breweries  and Other Breweries.  Boston Beer shall invoice  Stroh
for  all Hops delivered to Stroh hereunder upon delivery and  all
such  invoices  shall  be  payable  withi  thirty  (30)  days  of
invoicing.  All vendors shall be selected by Boston Beer  in  its
discretion, subject only to meeting Stroh's customary quality and
performance requirements.

               9.   Risk of Loss

   Stroh  and  Boston Beer acknowledge and agree that, consistent
with  the  F.O.B. pricing terms, the risk of loss in loading  the
carrier's  trucks shall be borne by Stroh. However, the carrier's
driver  shall have the right to inspect each shipment for  damage
prior  to leaving the loading dock and, accordingly, Boston  Beer
shall  bear  the  risk of loss on any shipment of Beer  Products,
once the carrier's truck leaves Stroh's loading dock.

               10.  Brewery of Record.

   (a)    To  the extent requested by Boston Beer and  consistent
with  applicable  laws and regulations, Stroh shall  provide  all
Beer Products brewed hereunder under the name of "The Boston Beer
Company"  as  the Brewer of Record. Stroh shall, to  the  fullest
extent  permissible, secure any permits, licenses, approvals  and
the  like  related  to the production of beer,  required  by  any
federal,  state or local governmental agency on behalf of  Boston
Beer. Boston Beer agrees to reimburse Stroh promptly for any out-
of-pocket  costs, including, without limitation,  legal  expenses
and increased clerical costs, incurred in connection therewith.

   (b)   To the extent requested by Boston Beer, Stroh shall  use
all  commercially reasonable efforts to establish an  alternating
proprietorship  at  each  of  the Breweries  and  at  such  Other
Breweries  to  which  production  of  Beer  Products   has   been
transferred, if necessary, and, subject to and in compliance with
all   applicable  federal,  state,  or  local  laws,  rules   and
regulations, to identify Boston, Massachusetts, as the sole label
source  for Beer Products. Boston Beer agrees to reimburse  Stroh
for its out-of-pocket costs, including, without limitation, legal
expenses  and  increased clerical costs, incurred  in  connection
therewith.

               11.      *   .

  The Price shall include      *     .

               12.       *     .


               *


      13.  Force Majeure.

      (a)   If  Stroh  is unable, by reason of a  labor  dispute,
governmental  action,  act of God or the like,  to  produce  Beer
Products  at  any  Brewery  to the extent  contemplated  by  this
Agreement, it shall, in any event, to the extent it is still able
to  maintain production at such Brewery, continue to produce Beer
Products  at such Brewery in proportion to the capacity  at  such
Brewery dedicated to beer Products prior to the occurrence of the
event  in question.  In addition, Stroh shall advise Boston  Beer
of  the  terms  on  which Stroh is then willing to  produce  Beer
Products  at  Other Breweries while the reduction in capacity  at
the affected Brewery continues.

  (b)     If Boston Beer is unable, by reason of a labor dispute,
governmental  action,  act of God or the like,  to  produce  Beer
Products at any brewery not owned by Stroh but at which from time
to  time  Boston Beer produces Beer Products, and  at  that  time
Stroh  has available production capacity at any of its Breweries,
Stroh  shall  make such production capacity available  to  Boston
Beer at a price equal to Stroh's      *      under this Agreement
for such production.

      14.       *     .

                         *





               15.  Agency and Indemnification.

   Stroh and Boston Beer understand and agree that each party  is
not,  by  this Agreement or anything herein contained,  including
Stroh's affixing to Beer Products or Seasonals and/or registering
the  name  of "The Boston Beer Company" or "Boston Beer Company",
constituted or appointed the agent of each other for any  purpose
whatsoever,  nor  shall anything herein contained  be  deemed  or
construed as granting Boston Beer or Stroh any right or authority
to assume or to operate any obligation or responsibility, express
or  implied, for or on behalf of or in the name of the other,  or
to  bind  the other in any manner or way whatsoever. Boston  Beer
shall indemnify and hold harmless Stroh from and against any  and
all  claims,  expenses, causes of action or  liabilities  of  any
nature  whatsoever (collectively "Damages"), to the  extent  that
Damages  arise  from  the  independent conduct  of  Boston  Beer;
provided that Damages shall not include any loss, liability, cost
or  expense incurred by Stroh as a consequence of an exercise  by
Boston Beer of any of its rights under this Agreement.

               16.  Product Liability"'.

           (a)  Stroh and Boston Beer shall each maintain product
liability  insurance of not less  than       *       and  in  the
amount  of       *       combined single limit in  the  aggregate
relating to the Beer Products produced by Stroh for Boston Beer.

          (b)  Stroh shall indemnify and hold harmless Boston Beer and
all  of  its  affiliates  from and  against  any  and  all  loss,
liability,  cost  or expense of any nature whatsoever,  including
reasonable  attorney's  fees  (collectively,  "Product  Liability
Damages"),  arising  out of or associated with  all  claims  made
against  Boston Beer by any party or parties for personal  injury
or property damage caused by impurities, defects, or adulteration
of  any  kind  in the Beer Products manufactured and packaged  by
Stroh,  regardless of when manufactured or packaged; except  that
Stroh shall have no such indemnification obligations with respect
to (i) Product Liability Damages were caused by (i) Boston Beer's
improper storage, handling, or alteration of the Beer Products in
question  or  (ii) Packaging Materials or ingredients  purchased,
specified  or  otherwise approved by Boston  Beer  subsequent  to
written notice from Stroh reasonably advising that such Packaging
Materials or ingredients should not be used in the Beer  Products
for  health and safety reasons, it being understood that  Stroh's
sole  obligation with respect to providing any such notice  shall
be  to  inform  Boston  Beer of matters  which  come  to  Stroh's
attention and Stroh shall have no independent duty to analyze any
Boston  Beer  Packaging Materials, ingredients or specifications,
and  (iii)  Product  Liability Damages  resulting  from  inherent
properties   and/or   characteristics  of  the   Beer   Products,
including,  by way of example and not of limitation,  health  and
intoxicating effects of the Beer Products.

                                    10                          -
       (c)    Boston   Beer  shall  indemnify  and   hold   Stroh
and  all of its affiliates harmless from and against any and  all
Product  Liability  Damages  to the extent  arising  out  of  the
courses  excepted from Stroh's indemnification obligations  under
paragraph (b), above.

          (d)   Notwithstanding the provisions  of  subparagraphs
(b)  and (c) of this Paragraph 12, in no event shall either Party
be  liable to indemnify the other Party for consequential damages
other   than   consequential  damages  arising  out  of   willful
managerial  misconduct suffered by the other Party  and  even  in
such latter event not in an amount greater than      *     .

               17.  Recipe and Quality.

          (a)   Stroh  shall produce the Beer Products using  the
ingredients  and brewing procedures specified by Boston  Beer  or
its  appointee.  Boston Beer has the right to change  ingredients
and/or  to  specify brewing procedures provided that  (i)       *
,  (ii)  the specified ingredients are readily available  in  the
necessary  time frame, and (iii) if the brewing time  and/or  the
tank  storage time required for fermentation or aging  materially
exceeds  that required for Samuel Adams Lager, Boston  Beer  will
negotiate  in  good faith with Stroh      *      at the  affected
Brewery or Breweries.

          (b)   Stroh shall use its best efforts to meet  all  of
the specifications for each of the Beer Products. Boston Beer has
the  right to reject batches of beer which it determines to taste
or  look materially different from a representative sample of the
Beer Products or Seasonals, such rejection not to be arbitrary or
unreasonable. Any rejected batches may be blended by  Stroh  into
any  other  Beer  Product only in accordance with all  applicable
regulations  and with Boston Beer's prior consent,  such  consent
not to be unreasonably withheld.

               18.  Trademarks.

          (a)  Stroh acknowledges that no trademark or trade name
rights  in any of the trademarks, trade names, service marks,  or
logos  owned  by Boston Beer, including specifically but  without
limitation  those  identified on the Trademark Schedule  attached
hereto  (collectively,  the "Trademarks")  are  granted  by  this
Agreement.

          (b)    Boston  Beer  hereby  represents,  warrants  and
covenants to that it has and will maintain the right to  use  the
Trademarks  and will indemnify and hold harmless Stroh  from  any
claim of alleged infringement brought by any party against Stroh,
including, but not limited to, Stroh's reasonable costs of  legal
expenses.



                             - 11 -
                    19.  Successors and Assigns.

     The Agreement shall be binding upon and inure to the benefit
of  the  successors and assigns of the Parties, but shall not  be
assigned  by any Party without the prior written consent  of  the
other  Parties, which consent will not be unreasonably  withheld.
No  failure of Boston Beer to consent to a proposed assignment of
this  Agreement by Stroh shall be deemed unreasonable  if  Boston
Beer  believes  in good faith that the proposed assignee  is  not
capable  of  performing  the  production  obligations  of   Stroh
hereunder. No assignment of this Agreement by Stroh shall relieve
it   of  its  financial  obligations  hereunder,  including   its
indemnification obligations, or its obligation to      *       to
the extent required under Section 12, if the assignee defaults in
the  performance of its obligations hereunder, or if an  assignee
of   Stroh's  assets  generally  elects  not  to  assume  Stroh's
obligations hereunder.      *

                    20.  Governing Law.

  This agreement shall be interpreted and construed in accordance
with the laws of the State of New York.
                    21.  Arbitration.

     Any disagreement, dispute, controversy or claim with respect
to  the  validity  of  this Agreement or arising  out  of  or  in
relation  to  the Agreement, or breach hereof, shall  be  finally
settled by arbitration in New York, New York, in accordance  with
articles  of the American Arbitration Association for  Commercial
Arbitration.  The arbitrator(s) shall have the  right  to  assess
costs,  including  legal  expenses, in favor  of  the  prevailing
Party,    including,   if   applicable,   Stroh   travel   costs.
Notwithstanding the foregoing, the parties may have  recourse  to
the  courts  of  the United Sates of America for the  purpose  of
obtaining preliminary injunctive relief, including spec  ifically
in  the case of Boston Beer enforcing its rights under Section 12
in the event of a Stroh Production Default.

                    22.  Execution in Counterparts.

          This Agreement may be executed in one or more counterparts,
each  of which shall be deemed to be an original but all of which
together shall constitute one and the same document.
                             - 12 -
                    
                    
                    
                    23.  Amendment.

     No  Amendment, change, or modification of any of the  terms,
provisions  or  conditions of this Agreement shall  be  effective
unless  made in writing and signed or initialed on behalf of  the
parties hereto by their duly authorized representatives.

          24.  No Third Party Beneficiaries.

     Stroh  and  Boston Beer agree that this Agreement is  solely
for  their benefit and does not nor is it intended to create  any
rights  in  favor of, or obligations owing to, any person  not  a
party to this Agreement.

          25.  Merger: Separability.

     Subject  to  the  provisions of Section 26(a),  below,  this
Agreement terminates and supersedes all prior formal or  informal
understandings  among  the parties with respect  to  the  subject
matter contained herein, except the Letter of Intent, which  also
remains  in  full  force  and effect.  Should  any  provision  or
provisions  of this Agreement be deemed ineffective or  void  for
any  reason  whatsoever, such provision or  provisions  shall  be
deemed  separable and shall not effect the validity of any  other
provision.

          26.  Current Practice: Cooperation.

          (a)  Except as set forth in this Agreement, the Parties
agree  to continue their current business practices with  respect
to  the  Beer Products produced by Stroh for Boston Beer, subject
to  modification  from  time to time as the  parties,  exercising
reasonable business judgment, shall mutually agree in writing.

          (b)  *

          (c)  The Parties also agree to cooperate with one another,
consulting  on a regular basis, with a view to achieving  further
financial  economies, e.g.      *     , whether at a Brewery,  an
Other  Brewery or otherwise. In addition, Stroh agrees to  advise
Boston  Beer  of  opportunities of which Stroh becomes  aware  to
purchase from Stroh breweries or brewing,      *     .

           (d)  All publicity concerning this Agreement shall  be
subject to the restrictions on disclosure set forth in the Letter
of Intent.


                             - 13 -
                                
                    27.  Lab Tests.

     Stroh  will  perform at its expense all lab tests  currently
performed by Stroh for

Boston Beer on all Beer Products.

                    28.  Non-Exclusive Nature of Agreement.

     Nothing  contained  in this Agreement shall  require  Boston
Beer to avail itself of the Committed Capacity or preclude Boston
Beer  from engaging any other brewer for the purpose of producing
and distributing Beer Products.

                    29.       *     .

     (a)    For  so  long  as this Agreement remains  in  effect,
without  the  prior written consent of Boston Beer,  Stroh  shall
not, on behalf of any unaffiliated person,      *     .

     (b)     Boston  Beer  acknowledges  that  Stroh's   business
includes  brewing  craft  and specialty malt  beverage  products,
including products that may compete directly with, use  the  same
brewing ingredients and formulae as, and/or are of the same style
as  one  or  more of the Beer Products. Boston Beer  agrees  that
nothing contained in this Section 29 shall in any manner prevent,
limit, restrict or otherwise affect Stroh's right to continue and
expand such aspect of its business, including by introducing  new
products  that compete directly with existing Beer  Products,  so
long  as  Stroh  does  not intentionally (i) copy  the  identical
brewing  formulae and ingredients of any Beer Product,  (ii)  use
any  proprietary yeast specifically supplied to Stroh  by  Boston
Beer  solely  for use in producing Beer Products,  or  (iii)  use
labeling or other packaging. which infringes any of Boston Beer's
Trademarks  or  copies  Boston  Beer's  marketing  position   and
strategy.

                    30.  Yeast Strains.

     Stroh will not use yeast strains supplied by Boston Beer  to
brew  any beers other than the Beer Products. The obligations  of
Stroh under this Section 30 shall survive any termination of this
Agreement.

                    31.  Notices.

     All  notices  required herein shall be given  by  registered
airmail,  return  receipt  requested,  or  by  overnight  courier
service,  to  the following addresses (unless change thereof  has
previously  been given to the party given notice)  and  shall  be
deemed effective when received:

     If to Boston Beer:

          C.     James Koch, President,
          Alfred W. Rossow, Jr., C.O.O. and
          Martin Roper, Vice President
          The Boston Beer Company, Inc.
          75 Arlington Street, Fifth Floor
          Boston, MA 02116

     With a copy to:

          Frederick H. Grein, Jr., Esq.
          Hutchins, Wheeler & Dittmar
          101 Federal Street
          Boston, MA 02110

     if to Stroh:

          James R. Avery, Executive V. Pres.-Operations
          and Christopher T. Sortwell, Executive V. Pres. and
Chief Financial Officer
          The Stroh Brewery Company
          100 River Place
          Detroit, MI 48207

     With a copy to:

          George E. Kuehn, Executive V. Pres. and General Counsel
          The Stroh Brewery Company
          100 River Place
          Detroit, MI 48207

     32.  Rights of Offset.

          Stroh and Boston Beer agree that, to the extent that
either of them is at any time owed money by the other Party,
including on regular invoices sent as provided herein, such Party
may set off such amount against any undisputed monies owed by it
to such Party from time to time, any such set off to be
accomplished by written notice to the owing Party, effective upon
being sent.

     33.  Deliveries to      *     .

          To the extent permitted by applicable law, if so
requested by Boston Beer, Stroh will      *     .

               34.  Adverse Product Statements.

   Each Party agrees to take all commercially reasonable steps to
prevent any of its personnel from making disparaging or otherwise
adverse remarks about the products of the other Party.

               35.  Limitation on Period of Claims.

   All  claims hereunder must be brought no later than  one  year
after  such claim arose or the Party having such claim  shall  be
deemed to have waived and forever released it; provided that, for
purposes  of  this Section 34, a claim shall be  deemed  to  have
arise  at the time that the Party asserting a claim first  became
aware of it.

          IN WITNESS WHEREOF, Stroh and Boston Beer have executed this
Agreement as of the date first above written.

                              BOSTON BEER COMPANY LIMITED
                              PARTNERSHIP


                              By:  Boston Brewing Company, Inc.,
its
                                   General Partner


                              By: C. JAMES KOCH, President

                              THE STROH BREWERY COMPANY



                              By:  CHRISTOPHER T. SORTWELL,
                                   Executive Vice President
                                   and Chief Financial Officer



                                 EXHIBIT 10.21
                                 
                                 * denotes expurgated
                                 information
                                 
                                 January 14, 1997



THE STROH BREWERY COMPANY
100 River Place
Detroit, Michigan 48207

ATTENTION:   Christopher T. Sortwell
            Senior Vice President, Finance

Ladies and Gentlemen:

     The  Boston Beer Company, Inc., a Massachusetts corporation,
for itself and its affiliates ("Boston Beer") hereby confirms its
proposal   with  respect  to  long-term  production  arrangements
between  Boston Beer and The Stroh Brewery Company ("Stroh"),  to
become effective if Boston Beer elects to make an investment (the
"Investment")   in   Stroh's  brewery   located   in   Allentown,
Pennsylvania, known as the "Lehigh Valley Brewery". If it  elects
to  make  the Investment, Boston Beer would invest up  to       *
(sometimes  referred  to as the "Project"). The  Project  entails
*        in  the  brewing  and  packaging  of  beer  products,  a
preliminary  schedule of which is attached hereto  as  Exhibit  A
(the "     *     "). Boston Beer's proposal is as follows:

     1.   Existing Production Arrangements. Boston Beer and Stroh
are  parties to certain existing arrangements, pursuant to  which
beer  products  are produced by Boston Beer at the Lehigh  Valley
Brewery under an alternating proprietorship, and at a brewery  in
Portland, Oregon (the "Portland Brewery"), acquired by Stroh
 from
G.  Heileman  Brewing  Company on or about  July  1,  1996.  Such
existing arrangements are currently intended to remain in  effect
until      *      and are hereby ratified and confirmed by Boston
Beer and Stroh, except as hereinafter provided.

     2.    Investment:  Modification  of  Existing  Arrangements.
Boston  Beer, in consideration for      *     , hereby agrees  to
*       in accordance with the Schedule of      *      Production
Requirements  attached hereto as Exhibit B,  and  further  agrees
that      *     .
                       
                       
                       
                       
                       
                       
                       
THE STROH BREWERY COMPANY
January 14, 1997
Page 2


     3.   New Production Arrangements. Upon the execution of this
Letter  of  Intent, Boston Beer and Stroh shall  enter  into  the
written contract (the "Production Agreement"), attached hereto as
Exhibit  C, pursuant to which such beer products as are requested
from time-to-time by Boston Beer shall be produced by Boston Beer
at  the       *      Brewery under an alternating proprietorship,
the      *      Brewery and the brewery      *      (the "      *
Brewery"), subject to the conditions and limitations set forth in
the  Production Agreement, for a term of up to      *      years,
commencing effective as of      *     .

      4.    Investment by Boston Beer. If Boston Beer  elects  to
*      ,  it shall, in consideration of the Production Agreement,
invest  up to      *      in the      *      Brewery, subject  to
the following provisions of this Section 4:
  
  (a)          Boston  Beer  shall  reimburse  Stroh  for       *
               of  the      *      Brewery and the       *      ,
               including  installation  costs,  up  to  a   total
               reimbursement of      *     .

  (b)          Boston Beer shall be entitled to      *     .

  (c)          Stroh  shall  invoice  Boston  Beer  monthly   for
               amounts  expended  by  Stroh  in  the  immediately
               preceding month for approved Project expenditures.
               Each  invoice  shall be accompanied by  a  Project
               status  report  and copies of all  relevant  third
               party invoices. Unless challenged in writing prior
               thereto, all such invoices shall be payable within
               30 days of receipt.

  (d)          Boston  Beer  shall have the right  on  reasonable
               notice and during normal business hours to inspect
               (i)  the  status of the Project and  (ii)  Stroh's
               books  and  records relating to the Project.  Such
               inspection shall be at the expense of Boston  Beer
               and  may  be conducted by such experts  and  other
               representatives  of Boston Beer,  as  Boston  Beer
               shall select in its sole discretion.

  (e)          As  provided in the Production Agreement,  in  the
               event  of  a  material default  by  Stroh  in  the
               performance  of  its obligations  to  Boston  Beer
               thereunder,
  
               
  THE STROH BREWERY COMPANY
  January 14, 1997
  Page 3
  
               Boston Beer shall be entitled to      *     .

      5.    Possible       *       Investment.    The  Production
Agreement  contains provisions with respect to Stroh's continuing
obligations to provide access to capacity       *      .  In  the
event  that  Boston Beer requests access to      *       capacity
beyond that called for by the Production Agreement at a time when
Stroh  reasonably  believes  that meeting  such  request  is  not
possible, given Stroh's then capacity constraints, Stroh,  if  so
requested  by Boston Beer, will promptly undertake an  evaluation
of   the  cost  and  feasibility  of  expanding  Stroh's        *
production capacity for the benefit of Boston Beer and submit  to
Boston  Beer  for consideration a written       *       shall  be
subject  to  the  terms and conditions then in effect  under  the
Production Agreement.

      6.    Access  to Information: Conditions. Stroh shall  give
Boston  Beer access to such information concerning Stroh and  the
*       Brewery  as Boston Beer may reasonably request to  assist
Boston  Beer in determining      *     . In addition,  if  Boston
Beer  elects to make the      *     , its obligations to  proceed
with  the transactions outlined above are further subject to  the
following  conditions being met or waived by Boston Beer  in  its
discretion prior to      *     :

  (a)          Stroh   shall   have   executed   the   Production
               Agreement.

  (b)          Boston  Beer  shall  have received  all  requisite
               governmental  and other third-party approvals,  as
               may  be  necessary for Boston Beer  and  Stroh  to
               enter into and perform the Production Agreement.

      7.   Exclusivity.  From the date of this Letter  of  Intent
until  the  earlier  of      *      or the  termination  of  this
Letter  of  Intent, Stroh shall      *      , to the extent  that
Stroh's  obligations  under any such agreement  might  materially
adversely  affect Stroh's obligations to Boston Beer  under  this
Letter of Intent or under the Production Agreement.

      8.   Binding Intent. It is the intention of Boston Beer and
Stroh  that  this  Letter of Intent shall be  and  be  deemed  to
constitute  their  respective  legally  binding  and  enforceable
obligations,  with respect to the matters discussed  herein.  Any
other legally binding obligation with respect to the transactions
contemplated  hereby  shall arise only  upon  the  execution  and
delivery  of  the Production Agreement. All other obligations  or
commitments to proceed with the


THE STROH BREWERY COMPANY
January 14, 1997
Page 4

transactions contemplated hereby shall be only those  obligations
as are set forth in the Production Agreement.

      9    No Publicity. Neither Boston Beer nor Stroh shall make
any  public  disclosure relating to the transactions contemplated
hereby or indicate that discussions are taking place between them
regarding      *     , without first notifying the other party of
the intended disclosure in writing.

      10.   No Brokers Each party represents and warrants to  the
other  that  it  has not made any agreement or taken  any  action
which might cause any broker or third-party to become entitled to
a  finder's  fee  or  brokerage commission as  a  result  of  the
transactions contemplated by this Letter of Intent.

11.          Expiration of Letter of Intent. This Letter of Intent is

conditioned  on your acceptance hereof not later than  5:00  P.M.

EST on Friday, January 17, 1997.



                                 Very truly yours,

                                 THE BOSTON BEER COMPANY, INC.


                                   BY:   C. JAMES KOCH, President

ACCEPTED:

THE STROH BREWERY COMPANY



BY:  CHRISTOPHER T. SORTWELL, Senior Vice president


                            EXHIBIT A
          TO THE LETTER AGREEMENT DATED JANUARY 14,1997
                             BETWEEN
                  THE BOSTON BEER COMPANY, INC.
                               AND
                    THE STROH BREWERY COMPANY

PRELIMINARY SCHEDULE OF      *







                                *
                                
                                
                                
                                
                                
                                
                                
                                


                            EXHIBIT B

          TO THE LETTER AGREEMENT DATED JANUARY 14,1997

                             BETWEEN
                  THE BOSTON BEER COMPANY, INC.
                               AND
                    THE STROH BREWERY COMPANY


                                
                                
                                
                                *
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                                
                            EXHIBIT C

          TO THE LETTER AGREEMENT DATED JANUARY 14,1997
                             BETWEEN
                  THE BOSTON BEER COMPANY, INC.
                               AND
                    THE STROH BREWERY COMPANY


                      PRODUCTION AGREEMENT



                                             EXHIBIT 10.22
                                             * denotes expurgated
information
                                
                        AGREEMENT BETWEEN
             BOSTON BEER COMPANY LIMITED PARTNERSHIP
                               AND
                 THE SCHOENLING BREWING COMPANY


     AGREEMENT entered into effective as of the 22nd day of  May,
1996  (the  "Effective Date") by and between BOSTON BEER  COMPANY
LIMITED   PARTNERSHIP,   d/b/a  THE  BOSTON   BEER   COMPANY,   a
Massachusetts  limited  partnership  ("Boston  Beer"),  and   THE
SCHOENLING  BREWING COMPANY, an Ohio corporation  ("Schoenling").
Schoenling  and  Boston  Beer are sometimes  referred  to  herein
individually as a "Party" and collectively as the "Parties".

     Schoenling and Boston Beer desire to enter into an agreement
pursuant  to  which Schoenling shall supply to  Boston  Beer  and
Boston  Beer  shall purchase from Schoenling  on  an  as  ordered
basis, proprietary beer products developed and marketed from time
to time by Boston Beer ("Products").

     ACCORDINGLY,  for  and  in  consideration  of   the   mutual
agreements contained herein, the Parties, intending to be legally
bound, hereby agree as follows:

          SCOPE OF AGREEMENT

          During  the  term  of this Agreement as  set  forth  in
Paragraph  4  hereof and in accordance with the terms  set  forth
herein,  Schoenling agrees to brew, package and sell Products  to
Boston  Beer  and  Boston Beer agrees
 to purchase  Products  from
Schoenling.  Brewing  of Products shall commence  for  commercial
purposes  promptly  after  Boston Beer reasonably  approves  test
brews  of  Products  produced  by  Schoenling  to  Boston  Beer's
specifications.

          PRICE AND MANNER OF PAYMENT: ANNUAL FEE.

          (a)    Except  as  otherwise provided in the  following
subparagraphs  of  this  Paragraph  2,  Boston  Beer  shall   pay
Schoenling  for Products an amount (the "Unit Price")  equal  to:
(i)  with  respect  to  Products packaged in  bottles,  a  "Fixed
Charge"  of      *      per unit of twenty-four 12-ounce  bottles
or twelve 22-ounce bottles (in either instance, a "Case Unit"; it
being the intent that the Fixed Charge for other 22 ounce package
configurations produced by Schoenling be prorated), or (ii)  with
respect  to Products packaged in kegs, a Fixed Charge  of       *
per  unit  of one-half barrel consisting of 15.5 U.S. gallons  (a
"Keg"),  plus (iii) in both cases, the net cost to Schoenling  of
all  Brewing Ingredients (as defined in Paragraph 3(a)) purchased
by  Schoenling and used in producing Products; all federal, state
and local excise taxes attributable to Products that are paid  by
Schoenling;  and a deposit charge of      *      per pallet.  For
this  purpose,  "net cost to Schoenling" shall  include  purchase
discounts, but not discounts resulting from credit terms.
          (b)   Unit  Prices are F.O.B. the carrier's  trucks  at
Schoenling's  docks (i.e., the Unit Price includes the  cost  and
risk   of  loading  trucks  at  Schoenling's  dock)  and  include
Schoenling's  labor  costs,  overhead,  profit  and  other  costs
incurred in the brewing and packaging of Products.

          (c)   Schoenling will invoice Boston Beer for the Fixed
Charge,   all   applicable  Brewing  Ingredients   purchased   by
Schoenling  attributable to Products shipped, all federal,  state
and local excise taxes attributable to Products that are paid  by
Schoenling,  and the pallet deposit charged on the date  Products
are  shipped.  All  invoices  will be  sent  to  Boston  Beer  by
telecopier  and Boston Beer will pay on each Friday by electronic
funds transfer all invoices received by Monday that relate to the
previous   week.  If  Schoenling  should  elect,  in   its   sole
discretion, to utilize electronic invoicing, Boston Beer will pay
on  each Wednesday all invoices received by Monday that relate to
the previous week.

          (d)    Schoenling  shall  be  entitled  to  such  price
increases,  as are negotiated in good faith from time-to-time  by
Schoenling  and  Boston Beer. When negotiating  production  price
increases,  the  parties shall analyze the  historical  financial
information accumulated for Schoenling's production and packaging
operations  and  attempt to determine pricing levels  for  Boston
Beer  products and for Schoenling proprietary products which will
fairly recover normal and necessary costs and provide a level  of
operating income which will allow prudent, stable reinvestment in
Schoenling's real property located in Cincinnati, Ohio (the "Real
Property")  and  Schoenling's fixed assets and equipment  as  are
used or useable in the brewing and packaging of beer products  or
in   the   administration   of   such   operations   ("Production
Equipment"). It is not intended, however, that Boston Beer pay  a
price  for Products which guarantees a fixed or minimum level  of
facility profitability nor replace dollar-for-dollar the  margins
formerly  generated by other contract customers, whether  or  not
Boston  Beer  avails  itself  of production  capacity  previously
dedicated  to  former  third-party  customers.  Boston  Beer  and
Schoenling  agree to consult and cooperate with  one  another  to
achieve  cost  reductions or to minimize cost  increases  to  the
extent  possible,  especially with respect to  the  cost  of  raw
materials and packaging materials.

          (e)  Boston Beer shall also pay to Schoenling an annual
administrative fee equal to      *     , the first such fee to be
due  and  payable  upon  the  execution  of  this  Agreement  and
thereafter  on  April 1 in each year during which this  Agreement
remains in effect.


               3.    BREWING INGREDIENTS. PACKAGING MATERIALS AND
          BREWING SUPPLIES

          (a)    For   purposes   of  this  Agreement,   "Brewing
Ingredients" shall be defined as all malt, yeast and hops used to
produce  Products.  Brewing Ingredients shall  be  purchased  and
supplied as follows:





                 (i)  All  malt used in the brewing  of  Products
shall  be  purchased by Schoenling directly from commercial  malt
suppliers. Schoenling and Boston Beer will use their best efforts
to  agree  upon  malt  specifications for malt  that  will  allow
Schoenling to commingle storage of malt used to produce  Products
with  malt  used  by  Schoenling to produce other  products.   If
Schoenling  and  Boston  Beer cannot  agree  upon  standard  malt
specifications,  the Fixed Charge shall be increased  to  reflect
any  additional cost incurred by Schoenling for separate handling
and storage of malt used in Products.

                (ii)  All  hops used in the brewing  of  Products
shall  be  purchased by Schoenling from Boston Beer. Delivery  of
hops shall be coordinated between Schoenling and Boston Beer.

          (iii)   All yeast used in the brewing of Products shall
be  supplied by Boston Beer at no charge to Schoenling. All yeast
supplied  by  Boston  Beer shall remain the property  solely  and
exclusively of Boston Beer and shall be segregated and identified
by  Schoenling as such. Delivery of yeast to Schoenling shall  be
coordinated between Schoenling and Boston Beer.

               (b)   For  purposes of this Agreement,  "Packaging
Materials"  shall  be  defined as all  bottles,  crowns,  labels,
cases, cartons, kegs, tap covers, pallets and dust covers and the
like  used  in the packaging and shipment of Products.  Packaging
Materials shall be purchased and supplied as follows:

     (i)  Bottles, crowns, labels, cases, cartons, tap covers and
the  like  shall  be  purchased by Boston Beer  and  supplied  to
Schoenling as needed to meet the Packaging Schedule for Products.

     (ii)  Kegs,  pallets and dust covers in quantities  adequate
for  the  volume of Products to be packaged under this  Agreement
shall be purchased by Boston Beer and supplied to Schoenling from
time  to  time. All such kegs, pallets and dust covers  shall  be
returned  and  reused  in accordance with  Schoenling's  standard
policies for keg and pallet return and reuse. From time  to  time
during the term of this Agreement, Boston Beer shall purchase and
supply to Schoenling additional kegs, pallets and dust covers  in
numbers adequate to replace kegs, pallets and dust covers lost or
otherwise  rendered unusable. All kegs, pallets and  dust  covers
shall  conform  to the specifications of kegs, pallets  and  dust
covers  used  by  Schoenling in packaging and  shipping  its  own
products.  Upon  each  delivery  to  Schoenling  of  new  pallets
purchased by Boston Beer, Schoenling shall issue to Boston Beer a
credit of      *      per pallet and the pallets shall thereafier
be the property of Schoenling.

     (iii)      Schoenling shall purchase and supply at  its  own
cost Lock n' Pop, shrink wrap, label adhesive, hot melt glue  and
bungs used in packaging and shipping of Products.

               (c)   For  purpose  of  this  Agreement,  "Brewing
Supplies"  shall  be  defined as      *      .  Schoenling  shall
purchase and supply at its own cost all Brewing Supplies used  in
the brewing of Products.

               (d)   Boston  Beer shall have sole  responsibility
for  the  selection  and  approval of  all  Brewing  Ingredients,
Packaging   Materials  and  Brewing  Supplies  used  to   produce
Products.   Boston  Beer shall have sole responsibility  for  the
content  and  design of all labels, tap covers, crowns,  cartons,
cases and other Packaging Materials.

     (e)   Upon the termination of this Agreement for any reason:
(i)  Boston  Beer will purchase from Schoenling (x) all  finished
Products  at  the  Fixed Charge, (y) all  inventory  of  work  in
process  of Products at Schoenling's cost, and (z) all  inventory
of  Brewing Ingredients, Packaging Materials and Brewing Supplies
purchased  by  Schoenling  that are  not  reasonably  useable  by
Schoenling  in  its own products at Schoenling's cost;  and  (ii)
Schoenling  will  make available for pick up by  Boston  Beer  at
Schoenling's   dock  all  finished  Products  and   all   Brewing
Ingredients, Packaging Materials and Brewing Supplies referred to
in  Subparagraph 3(e)(i) hereof. In the event sales  of  Products
are  substantially less than forecasted by Boston Beer  resulting
in   abnormally   excess  inventories  of  Brewing   Ingredients,
Packaging Materials and Brewing Supplies purchased by Schoenling,
Boston  Beer  will  purchase  such  excess  from  Schoenling   at
Schoenling's cost.

                    4.   TERM

     (a)   The term of this Agreement shall be      *       years
beginning   on  the  Effective  Date,  unless  sooner  terminated
pursuant  to  Paragraph  5 hereof. The Parties  acknowledge  that
Boston  Beer's  obligations pursuant to this  Agreement  to  make
payments  to  Schoenling and the Parties' respective  rights  and
obligations under Paragraphs 3(e), 11, 12, 14, 16(a),  16(c),  17
and 26 shall survive the termination of this Agreement.

                    5.   TERMINATION

     (a)   Either  Party  may terminate this Agreement  effective
immediately upon written notice to the other Party in  the  event
that  the  other  Party is in default of any of  its  obligations
under  this  Agreement, which default continues for a  period  of
thirty  (30)  days following receipt of written  notice  of  such
default.

     (b)   Either  Party  may terminate this Agreement  effective
immediately upon written notice to the other Party in  the  event
that: (i) the other Party makes an assignment for the benefit  of
creditors   or   files   a   voluntary  bankruptcy,   insolvency,
reorganization  or  similar  petition  seeking  protection   from
creditors  petition;  (ii) the other Party fails  to  vacate  any
involuntary  banknuptcy,  insolvency or  reorganization  petition
filed  against such Party within sixty (60) days after the filing
of  such petition; or (iii) the other Party liquidates, dissolves
or ceases to do business as a going concern.

     (c)  Schoenling may terminate this Agreement, if Boston Beer
fails to meet certain minimum purchase requirements, as specified
in Section 6(b).

     (d)   Schoenling may terminate this Agreement effective upon
the  termination of the Option Agreement (the "Option Agreement")
of  even  date herewith pursuant to which Schoenling  granted  to
Boston Beer an option (the "Option") to acquire the Real Property
and certain of the Production Equipment.
     (e)   Upon  termination of this Agreement pursuant  to  this
Paragraph  5,  Boston Beer shall promptly pay to  Schoenling  all
unpaid  invoices  in  full  and  all  unpaid  costs  incurred  by
Schoenling  pursuant to this Agreement in the brewing, packaging,
shipping  and  storage  for Products.  Schoenling  will  use  all
reasonable  efforts to minimize such costs upon  termination  and
Boston   Beer   will  have  the  right  to  review  documentation
evidencing  such  costs. Also upon termination, Schoenling  shall
have the right to terminate the Option, as provided in the Option
Agreement.

                    6.   PACKAGING. DEPOSITS AND MINIMUM ORDERS

     (a)   Packaging of Products shall consist of Kegs and twelve
ounce (12 oz.) and twenty-two ounce (22 oz.) bottles. Except  for
one-way pailets paid for by Boston Beer, a deposit per pallet, as
set  forth  in Paragraph 2(a) hereof, shall be charged to  Boston
Beer with a corresponding credit applied upon the safe return  in
good working order of the pallets to Schoenling. Boston Beer  has
the  right, subject to the approval of Schoenling which  approval
will  not  be  unreasonably withheld,  to  make  changes  in  the
Packaging  Materials,  including but  not  limited  to  packaging
Products  in can units in quantities consistent with Schoenling's
operational  capacities. Costs incurred by Schoenling  in  making
such changes shall be paid by Boston Beer.

     (b)   Boston  Beer  shall  purchase  not  less  than       *
barrels  of  Products  from  Schoenling  during  the  balance  of
calendar year 1996. Minimum production/purchase requirements  for
1997  and  beyond  shall be determined based on 6-month  planning
cycles,  with, for example, proposed commitments for  the  period
January 1 through June 30, 1997 to be submitted to Schoenling  by
Boston  Beer  on or about July 1, 1996. Minimum requirements  for
1997  and  1998  shall in any event be       *       barrels  and
*       barrels, respectively. Minimum requirements for 1999  and
subsequent  years  shall also be      *      barrels.  If  Boston
Beer fails to meet such minimum purchase requirements starting in
1999,  Schoenling  shall have the right to terminate  the  Supply
Contract, as follows:

                              (i)    If  Boston  Beer  fails   to
               purchase at least      *      barrels in  any  six
               (6)  month period January through June and       *
               barrels  in any six (6) month period July  through
               December,  Schoenling may give written  notice  to
               Boston  Beer  of  its intention to  terminate  the
               Supply  Contract if the shortfall iS not  made  up
               during  the  succeeding six (6) month period  (the
               "Make-Up Period"). Any such notice of intention to
               terminate  must be given prior to the end  of  the
               first month of the Make-Up Period.

                              (ii)   If  Boston  Beer  does   not
               purchase  sufficient quantities of  beer  products
               during the Make-Up Period such that for the twelve
               (12)  month period ending on the last day  of  the
               Make-Up  Period, Boston Beer shall  have  met  its
               minimum  purchase  requirements, Schoenling  shall
               have the right to terminate the Supply Contract on
               one   hundred  twenty  (120)  days  prior  written
               notice,  given at any time prior to the expiration
               of  thirty (30) days after in the end of the Make-
               Up Period.

                    (iii)     If Schoenling terminates the Supply
               Contract  pursuant to clauses  (i)  and  (ii),  it
               shall also have the right to terminate the Option,
               effective on termination of the Supply Contract.

Boston  Beer's  commitments are inclusive of  any  beer  products
produced  for      *     , other Boston Beer licensees and  other
parties brought to Schoenling by Boston Beer.  Boston Beer  shall
have  the right to avail itself of all of Schoenling's production
capacity,  excepting  only  such capacity  as  is  identified  on
Schedule B attached hereto, such other third-party commitments as
shall be approved in advance by Boston Beer, which approval shall
not  be  unreasonably  withheld, except  that  it  shall  not  be
unreasonable for Boston Beer to withhold approval if the proposed
commitment  involves  competing products as  defined  in  Section
16(b) hereof, and up to      *      (or such increased amount  as
may  from  time  to time be approved in advance by  Boston  Beer,
which approval shall not be unreasonably withheld) cases per year
of  production of Schoenling's own proprietary alcoholic and non-
alcoholic  products.   Notwithstanding the foregoing,  Schoenling
shall  be  entitled  to  utilize its facilities  for  third-party
products marketed by Schoenling (e.g.,      *      ale), provided
that  to the extent such products utilize Schoenling's production
capacity,  they  will be included  within  the       *       case
capacity  (as such amount may be increased from time to  time  in
accordance  with  the preceding sentence of this subsection  (b))
reserved for Schoenling's proprietary products.

               (c)   Prior to commencing brewing of Products  for
commercial purposes and on a weekly basis thereafter, Boston Beer
shall provide Schoenling with a twelve (12) week Production  Plan
for  Products (the "Production Plan"). The Production Plan  shall
be  a  rolling  twelve week schedule setting  forth  brewing  and
packaging  requirements for Products for  each  week  during  the
twelve   weeks  covered  by  the  Production  Plan.  All  brewing
requirements  for  Products during the first  six  weeks  of  the
Production Plan shall constitute firm orders by Boston Beer.  All
brewing requirements for Products during the second six weeks  of
the  Production Plan and all packaging requirements set forth  in
the  Production  Plan shall be a forecast of Boston  Beer's  best
estimate  of brewing and packaging requirements for Products  and
shall  be  used  by  Schoenling for capacity  planning  purposes.
Boston  Beer  shall  update  the Production  Plan  each  week  by
providing its best estimate of brewing and packaging requirements
for the twelfth week and by revising the schedule for brewing and
packaging requirements in the sixth through eleventh weeks of the
Production Plan. The brew size that Boston Beer shall utilize  in
the  Production Plan shall be Schoenling's maximum brew based  on
Schoenling's  current  brewing vessels,  currently  estimated  to
yield  approximately      *      barrels of Products (a  "Brew").
The  minimum  brewing requirement that Boston  Beer  may  specify
during  any  week  in which it elects to  brew  shall  be       *
Brews.  Schoenling shall have the right, in its sole  discretion,
to  set  the  actual time and date on which each  Brew  shall  be
brewed,  provided that Schoenling shall use its best  efforts  to
minimize  the  length of time that Products  remains  in  storage
prior to packaging.
          (d)   Boston Beer shall place all orders for  packaging
and shipment of Products by the eighth business day of each month
(the  "Packaging  Schedule"). The Packaging  Schedule  shall  set
forth  the quantity of Products by package type and the  week  in
which  each  order  shall  be shipped  in  the  following  month.
Packaging shall be scheduled in increments of       *       cases
for  22  oz. boffles and      *      cases for 12 oz. bottles  in
new glass. The minimum order for packaging Products in Kegs shall
be      *      Kegs.

               7.   RISK OF LOSS

          Boston   Beer   shall  have  sole  responsibility   for
selecting  carriers and making all arrangements for  shipment  of
Products  to its customers. Boston Beer shall pay for  all  costs
associated with shipment of Products from Schoenlingts  facility.
Schoenling and Boston Beer acknowledge and agree that, consistent
with  the  F.O.B. pricing terms, the risk of loss in loading  the
carrier's  trucks  shall  be borne by  Schoenling.  However,  the
carrier's  driver shall have the right to inspect  each  shipment
for  damage  prior to leaving the loading dock and,  accordingly,
Boston  Beer  shall  bear the risk of loss  on  any  shipment  of
Products, once the carrier's truck leaves loading dock.

               8.   BREWERY OF RECORD

          (a)   Schoenling  shall  provide  all  Products  brewed
hereunder  under the narne of "The Boston Beer Company,"  as  the
Brewery  of  Record.  Schoenling shall secure  and  maintain  any
permits,  licenses,  approvals  and  the  like  required  by  any
federal,  state or local governmental agency on behalf of  Boston
Beer.   Boston  Beer agrees to reimburse Schoenling promptly  for
any  out-of-pocket  costs, including, without  limitation,  legal
expenses, incurred in connection therewith.

          (b)    Schoenling  shall,  to  the  extent   reasonably
possible,   by   establishing  and  maintaining  an   alternating
proprietorship  if  necessary, but subject to and  in  compliance
with  all  applicable  federal, state or local  laws,  rules  and
regulations,  identfy Boston, Massachusetts, as  the  sole  label
source  for  Products. Boston Beer agrees to reimburse Schoenling
for its out-of-pocket costs, including, without limitation, legal
expenses, incurred in connection therewith.

               9.   FORCE MAJEURE

          (a)   Schoenling shall not be liable to Boston Beer  in
the  event  that  Schoenling shall delay in or  fail  to  deliver
Products to Boston Beer hereunder for any reason or cause  beyond
its control, including but not limited to a slowdown, stoppage or
reduction of Schoenling's production or delivery due to  strikes,
fire,  flood,  labor  stoppage or slowdown, inability  to  obtain
materials  or  packages,  shortage of  energy,  acts  of  God,  a
limitation  or  restriction of its-production by  action  of  any
military or governmental authority, or any other such causes.

          (b)   In  the  event of any such slowdown, stoppage  or
reduction  of  Schoenling's production or deliveries,  Schoenling
will  allocate  its remaining capacity pro rata between  Products
and  other  products then produced by Schoenling,  provided  that
Boston  Beer  shall use reasonable efforts to move production  of
Products  to  its other suppliers for the duration  of  any  such
slowdown,  stoppage or reduction so as to minimize the amount  of
Products  that Schoenling is required to produce for Boston  Beer
during  such  slowdown,  stoppage or  reduction.   If  the  event
causing   slowddown,  stoppage  or  reduction   of   Schoenling's
production  or  delivery shall occur within two  hundred  seventy
(270) days after the beginning of commercial brewing of Products,
then  the pro rata allocation of Schoenling's remainig production
capacity  shall  be based on the proportionate  volume  of  other
products  produced by Schoenling during the six (6) month  period
immediately preceding the month in which occurred the event which
gave rise to the slowdow, stoppage or reduction and two (2) times
the  volume of Products produced by Schoenling during  the  three
(3)  month  period  immediately  preceding  the  month  in  which
occurred  the event which gave rise to the slowdow,  stoppage  or
reduction.   If  the  event  causing  the  slowdow,  stoppage  or
reduction of Schoenling's production or delivery shall occur more
than  two  hundred  seventy (270) days  after  the  beginning  of
commercial  production of Products, then the pro rata  allocation
of  Schoenling's remaining production capacity shall be based  on
the  proportionate volume of Products and other products produced
by  Schoenling  during  the  six  (6)  month  period  immediately
preceding  the month in which occurred the event which gave  rise
to the slowdown, stoppage or reduction of Schoenling's production
or delivery.

               10.  CHANGE PARTS AND BREWERY MODIFICATIONS

          Boston  Beer  will pay for     *      ,  provided  that
Schoenling  notifies Boston Beer in advance of  making  any  such
expenditures;  and  provided  further  that  Boston  Beer  hereby
acknowledges its obligations to pay for such expenses incurred by
Schoenling prior to the Effective Date. Boston Beer shall own all
*       paid for by Boston Beer and Schoenling shall allow Boston
Beer  to  remove  all  such       *      at  the  termination  or
expiration  of  this Agreement, provided that Boston  Beer  shall
restore,  or  reimburse  Schoenling  for  its  cost  to   restore
Schoenling's equipment or facilities to their condition prior  to
the  installation  of such      *     , ordinary  wear  and  tear
excluded.  The cost and ownership of any change parts or  brewery
modifications that can also be used by Schoenling to produce  its
own  products  shall be allocated between Schoenling  and  Boston
Beer by prior written agreement. Schoenling agrees to execute  an
appropriate  UCC  financing statement to  reflect  Boston  Beer's
ownership of any change parts or brewery modifications  owned  by
Boston  Beer.  Schoenling shall have no obligation  to  make  any
modifications  to its equipment or facilities to accommodate  the
production of Products unless agreed to by Schoenling in writing.

               11.  AGENCY AND INDEMNIFICATION

          Schoenling  and Boston Beer understand and  agree  that
neither  Party  is,  by  virtue of  this  Agreement  or  anything
contained  herein, including Schoenling affixing to any  Products
and/or  registering  the  name of "The Boston  Beer  Company"  or
"Boston Beer Company," constituted or appointed the agent of  the
other Party for any purpose whatsoever, nor shall anything herein
contained  be  deemed  or construed as granting  Boston  Beer  or
Schoenling  any  right or authority to assume or  to  create  any
obligation  or  responsibility, express or  implied,  for  or  on
behalf  of or in the name of the other, or to bind the  other  in
any  manner  or  way whatsoever. Boston Beer shall indemnify  and
hold  harmless  Schoenling from and against any and  all  claims,
expenses,   causes  of  action  or  liabilities  of  any   nature
whatsoever (collectively, "Damages"), to the extent that  Damages
arise from the independent conduct of Boston Beer; provided  that
Damages  shall not include any loss, liability, cost  or  expense
incurred by Schoenling as a consequence of the exercise by Boston
Beer of any of its rights under this Agreement.


               12.  PRODUCT LIABILITY

          (a)   Schoenling  and Boston Beer shall  each  malntain
products  liability insurance coverage in the respective  amounts
of   not  less  than       *       per  occurrence   and        *
combined single limit, and in the amount of not less than       *
combined  single  limit  in the aggregate  relating  to  Products
produced by Schoenling for Boston Beer hereunder.

          (b)   Schoenling  shall indernnify  and  hold  harmless
Boston  Beer and all of its affiliates from and against  any  and
all  loss,  liability, cost or expense of any nature  whatsoever,
including  reasonable  attorney's fees  (collectively,  "Products
Liability  Damages"),  arising out  of  or  associated  with  the
manufacture   and/or   packaging  of  Products   by   Schoenling,
regardless  of  when manufactured or packaged, and whether  under
this  Agreement  or  otherwise, except to  the  extent  that  (i)
Products  Liability  Damages  were caused  by  improper  storage,
handling or alteration of Products after delivery to Boston Beer,
(ii)  Products  Liability Damages are based on or result  from  a
claim  that  any  Products  are inherently  defective,  or  (iii)
Products  Liability  Damages were caused by Brewing  Ingredients,
Packaging  Materials or Brewing Supplies specified  or  otherwise
approved by Boston Beer.

          (c)   Boston  Beer  shall indemnily and  hold  harmless
Schoenling and all of its affiliates from and against any and all
Products  Liability  Damages to the extent  arising  out  of  the
causes  excepted from Schoenling's duty to indemnify Boston  Beer
under  clauses (i), (ii) and (iii) of subparagraph  (b)  of  this
Paragraph 12.

          (d)   Notwithstanding the provisions  of  subparagraphs
(b)  and  (c) of Paragraph 12, in no event shall either Party  be
liable to indemnily the other Party for product liability-related
consequential damages suffered by the other Party  in  an  amount
greater  than  the  lesser of  (i)       *       or  (ii)       *
plus       *       by  Boston  Beer for all Products  during  the
twelve  (12)  months  preceding the month in which  occurred  the
event giving rise to the claim for indemnification.

               13.  RECIPE AND QUALITY

          (a)    Schoenling  shall  produce  Products  using  the
ingredients  and  brewing formula and procedures  specified  from
time-to-time by Boston Beer. Boston Beer shall have the right  to
change  ingredients  and/or brewing formula and  procedures  upon
reasonable  prior written notice, provided that the cost  of  any
such  change shall be borne by Boston Beer and, provided further,
that  the  specified  ingredients are readily  available  in  the
necessary time frame.
          (b)   Schoenling shall use its best efforts to meet the
specifications for Products attached hereto as Schedule A. Boston
Beer  has  the  right  to reject batches  of  Products  which  it
determines  to  taste  materially different  from  representative
sample  of  Products,  such rejection  not  to  be  arbitrary  or
unreasonable.  Any rejected batches may be blended by  Schoenling
into other runs of Products.

               14.  TRADEMARKS

          (a)  Schoenling acknowledges that no trademark or trade
name  rights in "Samuel Adams Cream Stout", "Samuel Adams  Boston
Ale", "Samuel Adams Boston Lager," "Boston Lightship Lager,"  and
"The  Boston Beer Company" and any other trademarks, trade names,
service  marks  or logos owned by Boston Beer (collectively,  the
"Trademarks") are granted by this Agreement.

          (b)    Boston  Beer  hereby  represents,  warrants  and
covenants  to Schoenling that it has and will maintain its  right
to  use  the  Trademarks  and will indemnify  and  hold  harmless
Schoenling  from  any alleged infringement by any  Party  against
Schoenling including, but not limited to, Schoenling's reasonable
costs of legal expenses.

               15.  TEST BREWING

               Notwithstanding anything to the contrary  in  this
Agreement,  Boston  Beer  may,  at  any  time  after  notice   to
Schoenling  engage any other brewer for the purpose of conducting
test  production and distribution of Products in order to  ensure
the delivery of Products following termination of this Agreement.

               16.  COMPETING PRODUCTS

          (a)   Schoenling  will not at anytime use  the  brewing
formula  for Products for which Boston Beer has supplied brewing
formulas  to  Schoenling or any yeast supplied to  Schoenling  by
Boston Beer to produce a malt beverage product for itself (or any
of its affiliates) or on behalf of any unaffiliated person.

          (b)   For  so long as this Agreement remains in effect,
Schoenling shall not, without the prior written consent of Boston
Beer,  which  consent  may be withheld  by  Boston  Beer  in  its
discretion,  produce for or on behalf of any person  unaffiliated
with, Schoenling or Boston Beer a malt beverage product for  sale
in  the United States which (i) has a wholesale F.O.B. price that
is within      *      of the average of the ten (10) highest then
current  wholesale  F.O.B.  prices charged  by  Boston  Beer  for
Products, and (ii) is part of a family of malt beverage  products
having aggregate sales volume for the past twelve (12) months  in
excess  of       *      of Boston Beer's aggregate  sales  volume
during  the  same  twelve  (12) months,  except  for  those  malt
beverage  products being produced by Schoenling pursuant  to  the
arrangements disclosed on Schedule C attached hereto, and  except
for  products  marketed by Schoenling, as provided  in  the  last
sentence of Section 6(b) hereof.
               (c)   Boston Beer acknowledges that Schoenling  is
currently  in  the business of brewing craft and  specialty  malt
beverage products that are sirnilar to and compete with Products,
and  Boston  Beer  agrees that nothing in  this  Agreement  shall
prevent  Schoenling from continuing or expanding  its  craft  and
specialty   business,   provided  that   Schoenling   shall   not
intentionally copy the brewing formula for Products  or  use  any
yeast supplied to Schoenling by Boston Beer to produce craft  and
specialty  products  for  itself or any of  its  affiliates.  All
Products  produced by Schoenling for purposes of this  Agreement,
including all work in process, shall be produced solely  for  the
benefit of Boston Beer and used for no other purpose.

                    17.  RIGHTS OF OFFSET

               The  parties  acknowledge and agree that,  to  the
extent a Party is at any time owed money by the other Party, such
Party  may  set off such amount against any monies owed  by  such
Party  from time to time to such other Party, said set-off to  be
accomplished by written notice to such other Party effective upon
being sent.

                    18.  NOTICES

               All  notices  required herein shall  be  given  by
registered  airmail, return receipt requested,  or  by  overnight
courier  service,  in  both  cases  with  a  copy  also  sent  by
telecopier, to the following addresses (unless change thereof has
previously been given to the Party giving the notice)  and  shall
be deemed effective when received:
               
If to Boston Beer:      C. James Koch, President
                        and Alfred W. Rossow, Jr., COO
                        The Boston Beer Company
                        75 Arlington Street, Fifth Floor
                        Boston, Massachusetts 02116
                        Telecopier: (617) 728-4137

with a copy to:         Frederick H. Grein, Jr., Esq.
                        Hutchins, Wheeler & Dittmar
                        101 Federal Street
                        Boston, Massachusetts 02110
                        Telecopier: (617) 951-1295

If to Schoenling:       Kenneth Lichtendahl, President
                        Schoenling Brewing Company
                        1625 Central Parkway
                        Cincinnati, OH 45214
                        Telecopier: (513) 357-5215
with a copy to:         Thomas J. Westerfield, Esquire
                        Cors & Bassett
                        1200 Carew Tower
                        Cincinnati, OH 45202-2990
                        Telecopier: (513) 852-8222

                19.  SUCCESSORS AND ASSIGNS

          This  Agreement shall be binding upon and inure to  the
benefit  of the successors and assigns of the Parties, but  shall
not  be  assigned by any Party, whether by merger, consolidation,
reorganization, operation of law or otherwise, without the  prior
written  consent of the other Party, which consent  will  not  be
unreasonably withheld. Notwithstanding the foregoing, Boston Beer
may  assign  this Agreement without the consent of Schoenling  to
its  successor corporation or other successor entity in the event
of  any reorganization, public offering or change in the form  of
entity  of Boston Beer, provided that Boston Beer or its  current
stockholders shall own and control at least       *       of  the
outstanding stock of the successor corporation or other successor
entity taking assignment of this Agreement. No failure of a Party
to  consent  to  a proposed assignment of this Agreement  by  the
other  Party shall be deemed unreasonable if such Party  believes
in  good  faith  that the proposed assignee  is  not  capable  of
performing the financial or production obligations of  the  Party
proposing  to assign this Agreement. Assignment of this Agreement
shall   not   relieve  the  assigning  Party  of  its   financial
obligations  hereunder, including its indemnification obligations
hereunder.

                20.  GOVERNING LAW

               This  Agreement shall be interpreted and construed
in accordance with the laws of the Commonwealth of Massachusetts.


                21.  DISPUTE RESOLUTION

Any  disagreement, dispute, controversy or claim with respect  to
the  validity of this Agreement or arising out of or in  relation
to  the  Agreement,  or  breach hereof,  shall  be  submitted  to
arbitration in Boston, Massachusetts, in accordance with articles
of   the   American   Arbitration  Association   for   Commercial
Arbitration.  The arbitrator(s) shall have the  right  to  assess
costs including legal expenses, in favor of the prevailing parry,
including, if applicable, Schoenling's travel costs. The decision
of  the arbitrator(s) shall be final and binding on both Parties.
Notwithstanding  the  foregoing,  the  Parties  may,   prior   to
submitting a dispute to arbitration, have recourse to the  courts
of   the  United  States  of  America  or  the  Commonwealth   of
Massachusetts   for   the  purpose  of  obtaining   a   temporary
restraining  order  or  other preliminary injunctive  relief.  In
particular,  in  the  event of an unsettled dispute  between  the
parties to this Agreement, Boston Beer shall have recourse to the
Courts  of  the Commonwealth of Massachusetts for the purpose  of
obtaining  a  temporary restraining order  or  other  preliminary
injunctive  relief  to require Schoenling to  continue  to  brew,
package  and ship any Products ordered by Boston Beer under  this
Agreement  until Boston Beer shall have secured a new source  for
production   of   its   Products;  provided   that   under   such
circumstances Schoenling shall be entitled to payment in  advance
of production.
                22.  EXECUTION IN COUNTERPARTS

          This   Agreement  rnay  be  executed  in  one  or  more
counterparts each of which shall be deemed to be an original  but
all of which together shall constitute one and the same document.


                23.  AMENDMENTS

               No amendment, change or modification of any of the
terms,  provisions  or  conditions of  this  Agreement  shall  be
effective  unless  made  in writing and signed  or  initialed  on
behalf   of   the   parties  hereto  by  their  duly   authorized
representatives.

                24.  NO THIRD-PARTY BENEFICIARIES

               Schoenling  and  Boston  Beer  agree   that   this
Agreement is solely for their benefit and it does not nor  is  it
intended  to create any rights in favor of, or obligations  owing
to, any person not a Party to this Agreement.

                25.  MERGER; SEPARABILITY

               This Agreement terminates and supersedes all prior
formal  or  informal  understandings  between  the  Parties  with
respect to the subject matter contained herein, provided that the
confidentiality  and all other obligations of the  parties  under
(i)  the Confidentiality Agreement dated March 7, 1995, (ii)  the
letter  agreement  between the parties dated March  7,  1996  and
(iii)  the Option Agreement shall remain in full force and effect
in  accordance  with the terms thereof. Should any  provision  or
provisions  of this Agreement be deemed ineffective or  void  for
any  reason  whatsoever, such provision or  provisions  shall  be
deemed  separable and shall not effect the validity of any  other
provision.

                26.  LIMITATION PERIOD ON CLAIMS

               All claims hereunder must be brought no later than
one  (1)  year after such claims arose or the Party  having  such
claim  shall  be deemed to have waived and forever  released  it:
provided  that for this purpose, a claim will be deemed  to  have
arisen  at  the  time the Paty asserting the claim  first  became
aware of it.
               IN  WITNESS WHEREOF, the parties hereto enter into
this Agreement as of the date first above written.

                              BOSTON BEER LIMITED PARTNERSHIP
                              d/b/a The Boston Beer Company, Inc.

                              By:  Boston Brewing Company, Inc.
                                   its General Partner
Witness:

                                   By:  C. JAMES KOCH, President
_________________________________

                              THE SCHOENLING BREWING COMPANY

Witness:
                              By:  KENNETH LICHTENDAHL, President

_________________________________


                           SCHEDULE A
                               TO
                     SUPPLY CONTRACT BETWEEN
             BOSTON BEER COMPANY LIMITED PARTNERSHIP
                               AND
                 THE SCHOENLING BREWING COMPANY


                     Product Specifications



                    As  determined  from time to time  by  Boston
          Beer and submitted by Boston Beer to Schoenling.
                           SCHEDULE B
                               TO
                     SUPPLY CONTRACT BETWEEN
             BOSTON BEER COMPANY LIMITED PARTNERSHIP
                               AND
                 THE SCHOENLING BREWING COMPANY



                 CURRENT PRODUCTION COMMITMENTS


                                   *




















<TABLE>
Exhibit 11. 
                      THE BOSTON BEER COMPANY, INC. 
           STATEMENT REGARDING COMPUTATION OF NET EARNINGS PER SHARE
                 (in thousands, except per share data)
                                                                 
<CAPTION>
                                                  Year ended
                                    ---------------------------------------------
                                    December 28,   December 31,    December 31,     
                                        1996          1995            1994     
<S>                                 <C>           <C>              <C>    
Weighted average number of                                
  common shares outstanding         19,969,633    16,991,001       16,641,740   
  
Add:Common equivalent shares
    representing shares 
    issuable upon conversion
    of stock options                           
    (using the treasury
    stock method)                      382,363       685,511          563,571   
     
Add:Common equivalent shares per                                        
    SAB Topic 1B                             -       272,884          965,467   
                                    -----------   ----------       ----------
Weighted average number of common                            
  and common equivalent shares      20,351,996    17,949,396       18,170,778   
                                    ===========   ==========       ==========  
                                    
Net income                            $8,385        $5,896 <F1>      $5,320 <F1>
                                    ===========   ==========       ==========

Primary and fully diluted                                 
 earnings per share                    $0.41        $0.33  <F1>        $0.29 <F1>
                                    ===========   ==========       ==========

<FN>                                                                 
<F1>  Pro forma, see Note B on the accompanying Notes to Conolidated Financial Statements.
</FN>
</TABLE>

                                                                 
                                                                 
  (1)                                                            
  Pro
forma
, see
 Note
 B on
  the
accom
panyi
   ng
Notes
   to
  the
Conso
lidat
   ed
Finan
 cial
State
ments
    .







<TABLE> <S> <C>

<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from The Boston
Beer Company, Inc.'s consolidated balance sheet and consolidated statements of
income and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> US DOLLAR
       
<S>                             <C>
<PERIOD-TYPE>                   12-MOS
<FISCAL-YEAR-END>                          DEC-28-1996
<PERIOD-START>                             JAN-01-1996
<PERIOD-END>                               DEC-28-1996
<EXCHANGE-RATE>                                  1.000
<CASH>                                            5060
<SECURITIES>                                     35926
<RECEIVABLES>                                    18109
<ALLOWANCES>                                      1930
<INVENTORY>                                      13002
<CURRENT-ASSETS>                                 77691
<PP&E>                                           21043
<DEPRECIATION>                                    6412
<TOTAL-ASSETS>                                   96553
<CURRENT-LIABILITIES>                            29922
<BONDS>                                           1800
<PREFERRED-MANDATORY>                                0
<PREFERRED>                                          0
<COMMON>                                           201
<OTHER-SE>                                       64630
<TOTAL-LIABILITY-AND-EQUITY>                     96553
<SALES>                                         213879
<TOTAL-REVENUES>                                191116
<CGS>                                            95786
<TOTAL-COSTS>                                   177959
<OTHER-EXPENSES>                                     0
<LOSS-PROVISION>                                     0
<INTEREST-EXPENSE>                                 236
<INCOME-PRETAX>                                  14871
<INCOME-TAX>                                      6486
<INCOME-CONTINUING>                              13157
<DISCONTINUED>                                       0
<EXTRAORDINARY>                                      0
<CHANGES>                                            0
<NET-INCOME>                                      8385
<EPS-PRIMARY>                                      .41
<EPS-DILUTED>                                      .41
        

</TABLE>





                          EXHIBIT 21.1
                                
                      List of Subsidiaries
                                
                  The Boston Beer Company, Inc.
                  (a Massachusetts corporation)
                                
Boston Brewing Company, Inc.
(a Massachusetts corporation)

BBC Mass, Inc. (formerly H & Q Beverage Co., Inc.)
(a Massachusetts corporation)

The Wing Beer Co., Inc.
(a Texas corporation)

Sam Adams Investors, Inc.
(a Massachusetts corporation)

KJW Holdings, Inc.
(a Texas corporation)

Back Bay Beverage Company, Inc.
(a Delaware corporation)

BBC Del, Inc. (formerly Consumer Venture Beverage Co.)
(a Delaware corporation)

The  following  are subsidiaries of Boston Beer  Company  Limited
Partnership,  owned  directly  and  indirectly  (through   Boston
Brewing Company, Inc.) by The Boston Beer Company, Inc.

Oregon Beer and Brewing Co., Inc. I
(an Oregon corporation)

SBCC Company, Inc.
(a Delaware corporation)

Samuel Adams Brewery Company, Ltd.
(an Ohio limited liability company)