UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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): June 15, 1999
The Chalone Wine Group, Ltd.
(Exact Name of Registrant as Specified in Charter)
California 0-13406 94-1696731
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
621 Airpark Road
Napa, California 94558-4291
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: 707-254-4200
Item 2. Acquisition or Disposition of Assets
On June 15, 1999, The Chalone Wine Group, Ltd. (the "Company") acquired
all of the outstanding equity (the "Staton Hills Equity") of Staton Hills Winery
Company Limited ("Staton Hills") pursuant to a stock purchase agreement (the
"Purchase Agreement") between Peter Ansdell ("Ansdell"), SHW Equity Co., a
company wholly owned by Ansdell that held all of the outstanding equity of
Staton Hills ("SHW"), and the Company. Staton Hills produces, markets, and sells
premium white and red table wines.
Staton Hills has a wine production facility and approximately 21 acres
of real property located in Washington State, of which approximately ten acres
are producing vineyards (the "Winery"). Staton Hills also has ongoing contracts
to acquire grapes from approximately 90 acres of vineyards located in Washington
State. The Company intends to continue to use the Winery for the production and
marketing of Staton Hills-branded wine. The Winery will also form the core of a
new wine brand focusing on Cabernet Sauvignon and Merlot, which the Company
expects to introduce later this year.
Pursuant to the terms of the Purchase Agreement (attached hereto as
Exhibit 10.1 and incorporated herein by reference), the Company acquired the
Staton Hills Equity for $6,125,000, from which substantially all of Staton
Hills' existing liabilities were repaid, and of which $125,000 will be held back
by the Company for one year in order to secure Ansdell's indemnification
obligations. The source of funding for the acquisition was the Company's
existing line of credit with Rabobank Nederland, New York branch.
The Company anticipates that Ansdell will remain in a consulting
capacity with the Winery. Kevin Mott, formerly of Sainte Chapelle Winery in
Idaho, will assume responsibility for the Winery's management and grower
relations, under the direction of the Company.
When used in this Report, the words "anticipates," "intends," "expects"
and similar expressions are intended to identify forward-looking statements,
which are subject to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Such statements are subject to risks and
uncertainties that could cause actual results to differ materially. Each of
these factors, and other risks pertaining to the Company, the premium wine
industry and general business and economic conditions, are more fully discussed
in the Company's reports under the Securities Exchange Act of 1934, as amended,
filed from time to time with the Securities and Exchange Commission. Readers are
cautioned not to place undue reliance on these forward-looking statements, which
speak only as of the date hereof. The Company undertakes no obligation to
publicly release updates or revisions to these statements.
Item 7. Financial Statements and Exhibits.
(a) Financial statements of business acquired.
After reviewing the financial statements of the Company and Staton Hills, the
Company has determined that the threshold for filing audited financial
statements as required by this Item 7(a) has not been met.
(b) Pro Forma Financial Information.
After reviewing the financial statements of the Company and Staton Hills, the
Company has determined that the threshold for filing pro forma financial
statements as required by this Item 7(b) has not been met.
(c) Exhibits.
Exhibit No. Description
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10.1 Purchase Agreement among Peter Ansdell,
SHW Equity Co. and the Company, dated
as of June 15, 1999
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: June 30, 1999
THE CHALONE WINE GROUP, LTD.
By: /s/ Francois P. Muse
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Francois P. Muse
Chief Financial Officer