SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) August 5, 1994
______
Delaware Canandaigua Wine Company, Inc. and its 16-0716709
subsidiaries
New York Batavia Wine Cellars, Inc. 16-1222994
Delaware Bisceglia Brothers Wine Co. 94-2248544
California California Products Company 94-0360780
New York Canandaigua West, Inc. 16-1462887
New York Guild Wineries & Distilleries, Inc. 16-1401046
South Carolina Tenner Brothers, Inc. 57-0474561
New York Widmer's Wine Cellars, Inc. 16-1184188
Delaware Barton Incorporated 36-3500366
Delaware Barton Brands, Ltd. 36-3185921
Maryland Barton Beers, Ltd. 36-2855879
Connecticut Barton Brands of California, Inc. 06-1048198
Georgia Barton Brands of Georgia, Inc. 58-1215938
New York Barton Distillers Import Corp. 13-1794441
Delaware Barton Financial Corporation 51-0311795
Wisoncsin Stevens Point Beverage Co. 39-0638900
New York Monarch Wine Company, Limited Partnership 36-3547524
Illinois Barton Management, Inc. 36-3539106
New York Vintners International Company, Inc. 16-1443663
_____________ _______________________________________ __________
(State or other (Exact Name of registrant as specified (I.R.S.
incorporation or in its charter) Employer
organization) Identification
Number)
116 Buffalo Street, Canandaigua, New York 14424
___________________________________________________________
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (716)394-7900
_____________
Former Name, Former Adress and Former Fiscal Year, if Changed Since
Last Report
Item 2.
On August 5, 1994, Canandaigua Wine Company, Inc. (the
"Registrant"), through its wholly-owned subsidiary, Canandaigua
West, Inc., acquired certain of the assets of Heublein, Inc.
("Heublein"). The acquisition was made pursuant to an Asset
Purchase Agreement dated August 3, 1994 (the "Asset Purchase
Agreement") entered into between Heublein and the Registrant.
The acquisition included the wine brands Almaden and Inglenook as
well as Belaire Creek Cellars, Chateau La Salle and Charles Le
Franc table wines, Le Domaine Champagne and Almaden, Hartley and
Jacques Bonet brandy. The Registrant also acquired wineries in
Madera and Escalon, California and the grape juice concentrate
business which Heublein had conducted at the Madera winery, along
with certain foreign duty credits related thereto. The
Registrant intends to operate such wineries and continue the sale
of products under the acquired brands. The consideration for the
transaction was the result of arms-length negotiations and
consisted of the following (the terms used hereinafter have the
same respective meanings as set forth in the Asset Purchase
Agreement which is attached hereto as an exhibit):
(a) Cash Purchase Price in the amount of $130,554,577, which
is the sum of (i) the estimated Book Values, as of the
closing date, of the inventories, prepaid expenses, and
property, plant and equipment and deferred mold charges
included in the assets acquired by the Registrant (the
"Purchased Assets"), (ii) $25,000,000, paid by the
Registrant for the Almaden brands, and (iii) $500,000,
paid by the Registrant as consideration for Heublein's
covenant not to compete with the Registrant in the United
States for a period of 5 years following the Closing in
the production and sale of grape juice concentrate or
sale of packaged wines bearing the designation "Chablis"
or "Burgundy" except where, among other exceptions, such
designations are currently used with certain brands
retained by Heublein, less the sum of (a) the estimated
Book Value, as of the Closing Date, of the liabilities
assumed by the Registrant (the "Assumed Balance Sheet
Liabilities"), and (b) $47,575,000. Following the
Closing, Heublein will deliver to the Registrant a
Closing Statement setting forth the aggregate Book Value,
as of the Closing Date, of those items included in part
(i), above, and deducting therefrom the aggregate Book
Value, as of the Closing Date, of the items included in
part (a), above. The Closing Statement will also set
forth the amount (the "Adjustment Amount"), by which the
actual Book Value of the Purchased Assets, as of the
Closing Date, exceeds or is less than $152,629,577, the
estimate of such amounts as of the Closing Date. The
Adjustment Amount will be paid by the Registrant or by
Heublein, as appropriate, provided that the Registrant
will be entitled to raise objections to the Book Values
set forth in the Closing Statement. If, following such
objections, the Registrant and Heublein are unable to
agree on such Book Values, then the objections will be
submitted to an internationally recognized firm of
independent public accountants, designated jointly by the
Registrant and Heublein, whose decision regarding the
resolution of the objections shall be final and binding
on the Registrant and Heublein.
(b) The issuance to Heublein of options (the "Options") to
purchase an aggregate of 600,000 shares of the
Registrant's Class A Common Stock, consisting of (i)
200,000 shares at an exercise price of $30.00 per share
and (ii) 400,000 shares at an exercise price of $35.00
per share. The Options are immediately exercisable by
Heublein and expire on August 5, 1996. The Options are
subject to anti-dilution adjustments and will not be
registered under the Securities Act of 1933, as amended.
(c) The assumption of certain operating liabilities relating
to the assets and business acquired from Heublein which
are subject to adjustment pending receipt of the final
Closing Statement.
(d) The issuance to Heublein of a certain nonrecourse
promissory note (the "Foreign Duty Credit Note" in the
amount of $3,673,766.21 pursuant to which the Registrant
shall pay to Heublein certain duty drawback amounts which
the Registrant receives resulting from the exportation of
certain grape juice concentrate.
The source of the cash payment made at closing, together with
payment of other costs and expenses required by the transaction,
was financing provided to the Registrant pursuant to a certain
Second Amendment and Restatement dated as of August 5, 1994 of
Amendment and Restatement of Credit Agreement dated as of
June 29, 1993 (the "Amended Credit Agreement") among the
Registrant, its principal operating subsidiaries (the
"Subsidiaries"), and a syndicate of 11 banks for which The Chase
Manhattan Bank (National Association) ("Chase") acts as agent.
The syndicate includes Chase, Chase's Rochester Division, the
First National Bank of Boston, Manufacturers and Traders Trust
Company, NBD Bank, N.A., National City Bank, PNC Bank, National
Association, Wells Fargo Bank, N.A., American National Bank and
Trust Company of Chicago, The First National Bank of Chicago and
the Dawia Bank, Ltd. (the "Banks"). The Amended Credit Agreement
provides for (i) a $224,000,000 term loan facility due in
June 2000, (ii) a $185,000,000 Revolving Credit Facility expiring
in June 2000 and (iii) the previously existing $28,200,000
irrevocable letter of credit issued in connection with the
Registrant's June 29, 1993 acquisition of Barton Incorporated.
In connection with the Amended Credit Agreement, the Banks have
continued their liens and security interests in substantially all
of the assets of the Registrant and the Subsidiaries and were
given liens and security interests in the assets acquired from
Heublein, including mortgage liens and security interests in all
accounts and general intangibles, inventory, equipment,
trademarks and other properties. Repayment of the loans is also
guaranteed by the Subsidiaries.
The foregoing information contained in this Form 8-K with
respect to the acquisition and the financing thereof is qualified
in its entirety by reference to the complete text of the Asset
Purchase Agreement and the Amended Credit Agreement, copies of
which are attached hereto as Exhibits.
Item 5. Press Release
On August 5, 1994, the Registrant and Heublein issued the
following joint press release:
Canandaigua Wine Company, Inc. (NASDAQ/NMS:WINEA & WINEB) and
Heublein, Inc., a U.S. subsidiary of International Distillers and
Vintners, the drinks sector of Grand Metropolitan PLC
(NYSE/ADR.:GRM), announced today that they have completed the
transaction under which Canandaigua has acquired from Heublein
the brands Almaden and Inglenook, as well as the Belaire Creek
Cellars, Chateau La Salle and Charles Le Franc table wines,
Le Domaine Champagne and Almaden, Hartley and Jacques Bonet
brandy. Canandaigua also acquired Heublein's wineries in Madera
and Escalon, California, and the grape juice concentrate business
operated by Heublein at the Madera winery.
Marvin Sands, Chairman of the Board of Canandaigua said,
"This acquisition, which includes the Nation's third and sixth
largest wine brands, strategically positions Canandaigua as a
leader in the domestic table wine business. With separate sales
forces and distribution networks for the acquired brands and
Canandaigua's current brands, we believe we will succeed in
maintaining the continued success of our entire portfolio,
including the newly acquired brands." Sands added, "Having
recently visited the Madera winery, one of the largest in the
world, I found a high level of excitement among our new employees
who joined Canandaigua which is highly devoted to the continued
development of the wine business in the United States."
Robert M. Furek, President and Chief Executive Officer,
Heublein, said, "The sale positions us for continued growth and
illustrates our long-term strategy of focusing on premium brands
while reducing our cost base." He added, "We can now provide
even stronger support for our portfolio of vintage dated and
varietal wines, including such highly successful brands as
Beaulieu Vineyard, Glen Ellen, Blossom Hill and M.G. Vallejo."
The consideration for the transaction consisted of a cash
purchase price of approximately $130.5 million, the assumption by
Canandaigua of approximately $4.8 million of operating
liabilities, and the issuance to Heublein by Canandaigua of
options to purchase 200,000 shares of Canandaigua's Class A
Common Stock at an exercise price of $30 per share and 400,000
shares of its Class A Common Stock at $35 per share. As a result
of discussions between Heublein and Canandaigua following the
initial announcement regarding this transaction, Heublein has
retained its wineries in Paicines and Reedley, California and its
minority interest in the Madera Glass Company. Heublein has also
retained accounts receivable associated with the business being
sold.
The acquisition and related activities were financed by a
$180 million increase in Canandaigua's term loans and a $90
million increase in its revolving credit line under Canandaigua's
existing credit facility, all of which was arranged through The
Chase Manhattan Bank (National Association). The increase in
Canandaigua's revolving credit line will be used primarily to
purchase grapes from the 1994 harvest relative to the acquired
business.
For Heublein's fiscal year ended September 30, 1993, net
sales (excluding federal excise taxes) related to the assets and
business being sold were approximately $235 million.
Effective upon closing, Canandaigua consolidated the acquired
business into its wine division and hired virtually all of the
employees from Heublein related to the acquired business.
Employees who were not offered jobs by Canandaigua or not
retained by Heublein will receive severance benefits and
outplacement services from Heublein.
International Distillers and Vintners is the world's largest
wine and spirits business by volume. Heublein, based in
Farmington, Connecticut, produces, imports and markets more than
100 brands of wines and spirits, including Beaulieu Vineyard,
Glen Ellen, Blossom Hill and Mouton Cadet wines, Smirnoff vodka,
Jose Cuervo tequila, Black Velvet Canadian whisky and Christian
Brothers brandy. The company's domestic wine business is managed
by the San Mateo, California-based Heublein wine division under
the direction of Christopher P. Mottern, Executive Vice
President.
Canandaigua Wine Company, headquartered in Canandaigua, New
York, is the second largest wine producer, fourth largest
marketer of imported beers and eighth largest producer and
marketer of distilled spirits in the United States. The
Company's principal brands, giving effect to the acquisition,
include Corona beer, Almaden Wines, Inglenook Wines, Richards
Wild Irish Rose wines, Paul Masson wines, Taylor California
Cellars wines, Cook's champagne, St. Pauli Girl beer, Cribari
wines, Manischewitz wines, J. Roget champagne, Barton gin and
vodka, Tsingtao beer, Ten High bourbon and Montezuma tequila.
Canandaigua's Wine Division is managed by Chris Kalabokes, Sr.
Vice President and President of the Wine Division.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits.
(a) Financial Statements of Business Acquired.
At the time of the filing of this Report, it is impracticable
to provide the financial statements required by Item 7 of Form 8-
K and Rule 3-05(b) of Regulation S-X and the manually-signed
accountants' report required by Rule 2-02 of Regulation S-X. The
required financial statements and the manually-signed
accountants' report will be filed by the Registrant, under cover
of Form 8-K/A, as soon as practicable, but not later than
October 19, 1994.
(b) Pro Forma Financial Information.
At the time of the filing of this Report, it is impracticable
to provide the unaudited pro forma financial information required
by Article 11 of Regulation S-X. The pro forma financial
information required by Article 11 of Regulation S-X will be
filed by the Registrant, under cover of Form 8-K/A, as soon as
practicable, but not later than October 19, 1994.
(c) Exhibits.
See Index to Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, each Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
CANANDAIGUA WINE COMPANY, INC.
Dated: August 22, 1994 By: /s/Richard Sands
Richard Sands, President and
Chief Executive Officer
SUBSIDIARIES
Batavia Wine Cellars, Inc.
Dated: August 22, 1994 By:/s/Richard Sands
Richard Sands, Vice President
Bisceglia Brothers Wine Co.
Dated: August 22, 1994 By: /s/Richard Sands
Richard Sands, Vice
President
Canandaigua West, Inc.
Dated: August 22, 1994 By:/s/Richard Sands
Richard Sands, President
California Products Company
Dated: August 22, 1994 By: /s/Richard Sands
Richard Sands, Vice
President
Guild Wineries & Distilleries,
Inc.
Dated: August 22, 1994 By: /s/Richard Sands
Richard Sands, Chairman of
the Board
Tenner Brothers, Inc.
Dated: August 22, 1994 By: /s/Richard Sands
Richard Sands, Vice
President
Widmer's Wine Cellars, Inc.
Dated: August 22, 1994 By:/s/Richard Sands
Richard Sands, Vice
President
Barton Incorporated
Dated: August 22, 1994 By: /s/Richard Sands
Richard Sands, Vice
President
Barton Brands, Ltd.
Dated: August 22, 1994 By:/s/Richard Sands
Richard Sands, Vice
President
Barton Beers, Ltd.
Dated: August 22, 1994 By: /s/Richard Sands
Richard Sands, Vice
President
Barton Brands of California, Inc.
Dated: August 22, 1994 By:/s/Richard Sands
Richard Sands, Vice
President
Barton Brands of Georgia, Inc.
Dated: August 22, 1994 By:/s/ Richard Sands
Richard Sands, Vice President
Barton Distillers Import Corp.
Dated: August 22, 1994 By: /s/Richard Sands
Richard Sands, Vice
President
Barton Financial Corporation
Dated: August 22, 1994 By:/s/David S. Sorce
David S. Sorce, Vice President
Stevens Point Beverage Co.
Dated: August 22, 1994 By:/s/Richard Sands
Richard Sands, Vice President
Monarch Wine Company, Limited
Partnership
Dated: August 22, 1994 By:/s/Richard Sands
Richard Sands, Vice
President Barton
Management, Inc., General
Partner
Barton Management, Inc.
Dated: August 22, 1994 By: /s/Richard Sands
Richard Sands, Vice
President
Vintners International Company, Inc.
Dated: August 22, 1994 By:/s/Richard Sands
Richard Sands, President
INDEX TO EXHIBITS
(1) Underwriting agreement
Not Applicable.
(2) Plan of acquisition, reorganization, arrangement, liquidation
or succession
(a) Asset Purchase Agreement between Heublein, Inc. and
Canandaigua Wine Company, Inc. dated August 3, 1994
(including a list briefly identifying all contents of all
omitted exhibits and schedules thereto *) is included
herein as Exhibit 2(a) at pages ___ through _____ of this
Report.
(b) Second Amendment and Restatement dated as of August 5,
1994 of Amendment and Restatement of Credit Agreement
dated as of June 29, 1993 among the Registrant, its
subsidiaries and certain banks for which The Chase
Manhattan Bank (National Association) act as agent
(including a list briefly identifying the contents of all
omitted exhibits and schedules thereto *) is included
herein as Exhibit 2(b) at pages ___ through ___ of this
Report.
(c) Security Agreement dated as of August 5, 1994 among the
Registrant, its Subsidiaries and certain banks for which
The Chase Manhattan Bank (National Association) acts as
agent (including a list briefly identifying the contents
of all omitted exhibits and schedules thereto *) is
included herein as Exhibit 2(c) at pages ___ through
___of this Report.
(4) Instruments defining the rights of security holders,
including indentures
Not Applicable.
(16) Letter re change in certifying accountant
Not Applicable.
(17) Letter re director resignation
Not Applicable.
(20) Other documents or statements to security holders
Not Applicable.
(23) Consents of experts and counsel
Not Applicable.
(24) Power of attorney
Not Applicable.
(27) Financial Data Schedule
Not Applicable.
(99) Additional Exhibits
None.
*The Registrant will provide copies to security holders of any of
the referenced omitted exhibits upon written request.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, each Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
CANANDAIGUA WINE COMPANY, INC.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, President and
Chief Executive Officer
SUBSIDIARIES
Batavia Wine Cellars, Inc.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Vice President
Bisceglia Brothers Wine Co.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands,Vice President
Canandaigua West, Inc.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, President
California Products Company
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Vice President
Guild Wineries & Distilleries, Inc.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Chairman of the Board
Tenner Brothers, Inc.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Vice President
Widmer's Wine Cellars, Inc.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Vice
President
Barton Incorporated
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Vice
President
Barton Brands, Ltd.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Vice
President
Barton Beers, Ltd.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Vice
President
Barton Brands of California, Inc.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Vice
President
Barton Brands of Georgia, Inc.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Vice
President
Barton Distillers Import Corp.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Vice
President
Barton Financial Corporation
Dated: August 22, 1994 By: s/David S. Sorce
David S. Sorce, Vice President
Stevens Point Beverage Co.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Vice
President
Monarch Wine Company, Limited
Partnership
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Vice
President Barton Management,
Inc., General Partner
Barton Management, Inc.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, Vice
President
Vintners International Company,
Inc.
Dated: August 22, 1994 By: s/Richard Sands
Richard Sands, President
INDEX TO EXHIBITS
(1) Underwriting agreement
Not Applicable.
(2) Plan of acquisition, reorganization, arrangement, liquidation or
succession
(4) Instruments defining the rights of security holders, including
indentures
Not Applicable.
(16) Letter re change in certifying accountant
Not Applicable.
(17) Letter re director resignation
Not Applicable.
(20) Other documents or statements to security holders
Not Applicable.
(23) Consents of experts and counsel
Not Applicable.
(24) Power of attorney
Not Applicable.
(27) Financial Data Schedule
Not Applicable.
(99) Additional Exhibits
None.