Chalone Wine Group to obtain new equity and acquire ownership in Chateau Duhart-Milon.NAPA, Calif.--(BUSINESS WIRE)--April 27, 1995--The Board of Directors of The Chalone chalone /chal·one/ (kal´on) a group of tissue-specific water-soluble substances that are produced within a tissue and that inhibit mitosis of cells of that tissue and whose action is reversible. Wine Group, Ltd. (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :CHLN) has reached an agreement with two of its largest shareholders, Domaines Barons de Rothschild (Lafite)(DBR DBR Drum-Buffer-Rope DBR Distributed Bragg Reflector dBr Decibel (reference value) DBR Deterministic Bit Rate DBR Daily Business Review DBR Dual Band Radar DBR Disclosure-Based Regulation ) and Summus Financial, Inc., to substantially increase its equity base. Subject to the successful conclusion of definitive agreements and approval by Chalone's shareholders, Chalone will receive equity of $5 million at $6.00 per share provided equally by DBR and Summus. DBR and Summus will also receive an equivalent number of warrants to purchase additional shares at $8.00 per share. In addition, DBR has agreed to convert its $12.4 million holding of debentures, at $7.00 per share, into 1.77 million shares of Chalone common stock. All other holders of the remaining outstanding debentures will be offered the same conversion terms. The Company will use the proceeds to pay down its bank lines of credit. Along with the conversion of DBR's debentures, the resulting annual interest savings will be over $1 million. Chalone's shareholder equity will increase from $24 million to a minimum of $41 million. Chalone will exchange substantially all of its existing ownership in DBR for a 23.5% partnership interest in Chateau Duhart-Milon, a classified fourth growth Bordeaux estate in Pauillac. DBR will continue as the managing partner. Also as part of the agreement, Chalone will increase its Board of Directors from nine to eleven members. DBR and Summus will each receive the right to designate a nominee for one of the two new seats. Philip Woodward Philip Woodward, retired Deputy Chief Scientific Officer of the British Defence Evaluation and Research Agency (DERA), is a mathematician, radar engineer and horologist. He has achieved notable success in all three fields. , Chalone's President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , will remain on the Board of Directors of DBR. "These positive changes in Chalone's balance sheet and in its vineyard portfolio will allow the Company to be in a stronger position to take advantage of future opportunities," commented Woodward. The Chalone Wine Group is a Napa-based company that produces, markets and sells premium white and red varietal table wines. The company owns and operates Chalone Vineyard Chalone Vineyard is located in the Chalone AVA south of San Francisco, California, United States, on an unusual geological formation called the Gavilan benchland. The soil is rich in limestone and calcium carbonate and also contains a significant amount of decomposed granite. in Monterey County, Acacia acacia (əkā`shə), any plant of the large leguminous genus Acacia, often thorny shrubs and trees of the family Leguminosae (pulse family). Winery in the Carneros District of Napa County, Carmenet Vineyard in Sonoma County; in conjunction with its joint-venture partner, Paragon Vineyard Co., owns and operates Edna Valley Vineyard in San Luis Obispo San Luis Obispo (săn l  `ĭs ōbĭs`pō), city (1990 pop. 41,958), seat of San Luis Obispo co., S Calif., near San Luis Obispo Bay; inc. 1856. county; and owns a 50% interest in Canoe Ridge Vineyard and a 51% interest in Canoe Ridge Winery, both in Washington State. Additionally, Chalone has a cross-investment and marketing alliance with Domaines Barons de Rothschild (Lafite)(DBR), owners of the Bordeaux estates of Chateau Duhart-Milon, Chateau Rieussec, Chateau L'Evangile and general manager of Chateau Lafite-Rothschild. DBR also has wine-making interests in Chile (Vina Los Vascos) and Portugal (Quinta do Carmo). CONTACT: Chalone Wine Group William L. Hamilton, 707/254-4220 |
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