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 Exchange Act of 1934
Date of Report (Date of earliest event reported):
August 25, 2006
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Brown-Forman Corporation
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(Exact name of registrant as specified in its charter)
Delaware 002-26821 61-0143150
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(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
850 Dixie Highway, Louisville, Kentucky 40210
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (502) 585-1100
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Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
ITEM 1.01. ENTRY INTO MATERIAL DEFINITIVE AGREEMENT
On August 28, 2006, Brown-Forman Corporation ("Brown-Forman") announced
that it has entered into an Asset Purchase Agreement dated as of August 25, 2006
with Jose Guillermo Romo de la Pena, Luis Pedro Pablo Romo de la Pena, Grupo
Industrial Herradura, S.A. de C.V. ("Grupo Industrial Herradura"), certain of
their respective affiliates, and Brown-Forman Tequila Mexico, S. de R.L. de
C.V., a subsidiary of Brown-Forman (the "Purchase Agreement"). Pursuant to the
Purchase Agreement, Brown-Forman will acquire substantially all of the assets of
Grupo Industrial Herradura and its affiliates relating to the tequila business,
including the Herradura and el Jimador tequilas, the New Mix tequila-based
ready-to-drink brand, related production facilities and a sales and distribution
organization in Mexico, for an aggregate purchase price of $876 million in cash
and the assumption of selected liabilities, in each case on the terms and
conditions set forth in the Purchase Agreement (the "Acquisition").
The Purchase Agreement has been approved by all necessary corporate and
shareholder actions, including the approval of the shareholders of Grupo
Industrial Herradura. The closing of the Acquisition, which is expected to occur
in the fourth calendar quarter of 2006, is subject to a number of conditions,
including expiration or termination of the applicable waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, issuance of a
non-objection opinion in respect of the Acquisition by the Mexican Federal
Competition Commission, receipt of other material regulatory approvals and
permits, and other customary conditions.
Under the terms of the Purchase Agreement, the aggregate purchase price
is subject to increase or decrease based on the closing amount of working
capital and will be reduced based on the amount of accounts receivable retained
by the sellers in accordance with the Purchase Agreement. In addition, the
Purchase Agreement includes representations, covenants, seller non-competition
arrangements and indemnification obligations customary for transactions of this
nature, as well as an escrow for the benefit of Brown-Forman, consisting of $22
million of the purchase price. Half of the escrow amount is expected to be
released to the sellers at the second anniversary of the closing date and the
remainder at the third anniversary, in each case subject to any claims. The
Purchase Agreement may be terminated upon the occurrence of certain events,
including the failure to complete the Acquisition on or before 120 calendar days
after the date of the Purchase Agreement, subject to certain conditions.
The Acquisition is anticipated to be financed by cash and debt.
The foregoing description of the Purchase Agreement does not purport to
be complete and is qualified in its entirety by reference to the Purchase
Agreement, which is filed as Exhibit 2.1 hereto and is incorporated into this
report by reference.
This report contains statements that constitute "forward-looking
statements" as defined under U.S. federal securities laws. Generally, words such
as "expects," "will," "projects," "anticipates" and similar expressions identify
a forward-looking statement, which speaks only as of the date the statement is
made. Except as required by law, we do not intend to update or revise any
forward-looking statements, whether as a result of new information, future
events, or otherwise. We believe that the expectations and assumptions with
respect to our forward-looking statements are reasonable. But by their nature,
forward-looking statements involve known and unknown risks, uncertainties and
other factors that in some cases are out of our control. These factors could
cause our actual results to differ materially from Brown-Forman's historical
experience or our present expectations or projections.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS
(D) EXHIBITS
EXHIBIT DESCRIPTION
2.1 Asset Purchase Agreement, dated as of August 25, 2006, by and among
Jose Guillermo Romo de la Pena, Luis Pedro Pablo Romo de la Pena,
Grupo Industrial Herradura, S.A. de C.V., certain of their
respective affiliates, Brown-Forman Corporation and Brown-Forman
Tequila Mexico, S. de R.L. de C.V.
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Brown-Forman Corporation
(Registrant)
August 29, 2006 By: /s/ Nelea A. Absher
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(Date) Name: Nelea A. Absher
Title: Vice President and Assistant
Corporate Secretary
EXHIBIT INDEX
2.1 Asset Purchase Agreement, dated as of August 25, 2006, by and among
Jose Guillermo Romo de la Pena, Luis Pedro Pablo Romo de la Pena,
Grupo Industrial Herradura, S.A. de C.V., certain of their
respective affiliates, Brown-Forman Corporation and Brown-Forman
Tequila Mexico, S. de R.L. de C.V.