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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-K/A
AMENDMENT NO. 1
to
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 June 30, 2000
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number: 000-23175
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BERINGER WINE ESTATES HOLDINGS, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
Delaware 68-0370340
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
</TABLE>
610 Airpark Road, P.O. Box 4500, Napa, California 94558
(Address of principal executive offices) (Zip Code)
(707) 259-4500
(Registrant's telephone number, including area code)
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Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
Class B Common Stock, Par Value $0.01
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities and Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. [X]
As of August 28, 2000, there were issued and outstanding (i) 1,337,962
shares of Class A Common Stock and (ii) 18,439,214 shares of Class B Common
Stock.
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TABLE OF CONTENTS
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Page
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<C> <S> <C>
ITEM 11. EXECUTIVE COMPENSATION...................................... 1
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.................................................. 4
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.............. 5
</TABLE>
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ITEM 11. EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth the cash compensation paid by the Company in
Fiscal Years 1998-2000 as well as certain other compensation paid, awarded or
accrued for those years to the Company's Chief Executive Officer and the other
four highest-paid executive officers during the 2000 fiscal year.
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<CAPTION>
Long-Term Compensation
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Annual Compensation Awards Payouts
------------------------------ --------------------- -------
Base Other Annual Restricted Securities LTIP All Other
Name and Principal Salary Bonus Compensation Stock Underlying Payouts Compensation
Position Year ($) ($)(2) ($)(3) Awards Options ($) ($)(1)
------------------ ---- -------- -------- ------------ ---------- ---------- ------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Walter T. Klenz......... 2000 $400,000 $253,460 0 25,000 0 $25,429
President, Chief 1999 $380,000 $462,500 0 45,000 0 $28,128
Executive Officer and 1998 $350,000 $ 97,500 0 68,000 0 $26,113
Chairman of the Board
of Directors
Peter F. Scott.......... 2000 $325,000 $ 83,100 0 12,000 0 $13,739
Executive Vice- 1999 $235,833 $217,000 0 12,000 0 $19,116
President Chief 1998 $225,000 $ 20,000 0 24,000 $10,782
Financial and
Administrative Officer
Edward B. Sbragia....... 2000 $275,000 $ 96,200 0 11,000 0 $10,804
Senior Vice-President 1999 $240,000 $115,000 0 12,000 0 $16,275
and Winemaster 1998 $225,000 $ 34,650 0 24,000 0 $15,946
James W. Watkins (4).... 2000 $266,042 $100,000 $73,252 0 135,000 0 --
Executive Vice 1999 -- -- 0 -- 0 --
President Chief 1998 -- -- 0 -- 0 --
Operating Officer
Robert E. Steinhauer.... 2000 $234,513 $ 72,800 0 9,000 0 $ 9,604
Senior Vice-President 1999 $212,000 $103,000 0 12,000 0 $11,360
Vineyard Operations 1998 $200,000 $ 31,500 0 24,000 0 $14,145
</TABLE>
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(1) These amounts represent matching contributions made by the Company under
its 401-K, Executive Savings Plan, Executive Deferred Compensation Plans
plus the Basic and Special Contributions to the 401-K Plan.
(2) The bonus paid in fiscal 1998 was for the six month period beginning
January 1, 1997 and ending June 30, 1997. The period was changed in
connection with the change from a calendar year to a fiscal year ending
June 30.
(3) The Other Annual Compensation that Mr. Watkins received was for moving
expenses in connection with accepting his position with Beringer Wine
Estates.
(4) Mr. Watkins joined the Company in September 1999.
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The following table presents additional information concerning the option
awards shown in the Summary Compensation Table for fiscal year 2000. These
options to purchase Class B Common Stock were granted to the named executive
officers under the 1996 Stock Option Plan.
OPTION GRANTS IN FISCAL 2000
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Individual Grants
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Percent of Potential Realizable
Securities Total Value at Assumed
Underlying Options Annual Rates of Stock
Options Granted Granted to Exercise Price Appreciation for
(2) Employees of Base Option Term (1)
--------------- in Fiscal Price Expiration ----------------------
Name Date Number Year ($/share) Date 5% 10%
---- ------- ------- ---------- --------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Walter T. Klenz......... 9/15/99 25,000 4.7909 $40.50 9/15/09 $1,649,250 $ 2,626,250
President, Chief
Executive Officer and
Chairman of the Board
of Directors
Peter F. Scott.......... 9/15/99 12,000 2.2996 $40.50 9/15/09 $ 791,640 $ 1,260,600
Executive Vice-
President Chief
Financial and
Administrative Officer
Edward B. Sbragia....... 9/15/99 11,000 2.1080 $40.50 9/15/09 $ 725,670 $ 1,155,550
Senior Vice-President
and Winemaster
James W. Watkins........ 8/11/99 135,000 25.8707 $38.19 8/10/09 $8,398,011 $13,373,100
Executive Vice-
President Chief
Operating Officer
Robert E. Steinhauer.... 9/15/99 9,000 1.7247 $40.50 9/15/09 $ 593,730 $ 945,450
Senior Vice-President
Vineyard Operations
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(1) These dollar amounts are not intended to forecast future appreciation of
the common stock price. There is no assurance provided to any executive
officer or any other holder of the Company's securities that the actual
stock price appreciation over the 10-year option term will be at the
assumed 5% or 10% annual rates of compounded stock price appreciation or at
any other defined level. Unless the market price of the shares appreciates
over the option term, no value will be realized from the option grants made
to the executive officers. Any gain to the executives resulting from common
stock appreciation would benefit all stockholders of the common stock.
(2) The option grants to the named executive officers were made at the fair
market value at the time of grant. These options are exercisable on the
fifth anniversary of the grant, except for those granted to Mr. Watkins,
whereby 27,000 shares are exercisable on each of the next five
anniversaries of the grant.
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Aggregated Option Exercises in Last Fiscal Year
and Fiscal Year-End Option Values
The following table shows information for the named executive officers,
concerning:
(i) exercises of stock options during 2000; and
(ii) the amount and values of unexercised stock options as of June 30,
2000.
Aggregated Option Exercises in 2000 and Year-End Option Values
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Number of Number of Securities Value of Unexercised
Securities Underlying Options In-the-Money
Underlying Value Granted (#) Options at Year-End ($)
Options Realized ------------------------- -------------------------
Name Exercised (#) ($) Exercisable Unexercisable Exercisable Unexercisable
---- ------------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Walter T. Klenz......... 11,684 $384,788.04 103,930 145,654 $3,670,080 $5,143,480
President, Chief
Executive Officer and
Chairman of the Board
of Directors
Peter F. Scott.......... 0 $ 0.00 56,000 82,000 $1,977,528 $2,895,666
Executive Vice-
President Chief
Financial and
Administrative Officer
Edward B. Sbragia....... 0 $ 0.00 57,188 55,186 $2,019,480 $1,948,783
Senior Vice-President
and Winemaster
Robert E. Steinhauer.... 20,057 $608,373.88 37,131 53,186 $1,311,207 $1,878,157
Senior Vice-President
Vineyard Operations
James W. Watkins........ 0 $ 0.00 27,000 108,000 $ 953,451 $3,813,804
Executive Vice-
President Chief
Operating Officer
</TABLE>
Director Compensation
Each director (except Walter T. Klenz, who is an employee) receives $2,500
for each Company Board meeting attended. Directors had been allowed to elect to
receive this compensation in cash, in shares of the Company's Class B Common
Stock or 50% in cash and 50% in stock. The program whereby the directors were
allowed to receive stock of the Company as compensation for attending meetings
of the Company Board was voluntarily suspended by the Company Board at a
meeting held on August 22, 2000. All eligible directors currently elect to
receive all the Board meeting compensation in cash. Company Board members are
also paid $1,000 for each committee meeting they attend. Company Board members
are reimbursed for travel expenses to the meetings. They also each receive ten
cases of the Company's wines each year. Employee directors are not eligible for
any additional compensation for service on the Company Board or its committees.
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Employment Agreements and Change in Control Agreements
Severance Agreements
We entered into a severance agreement with Ben Lawrence on December 27,
1999. In the event Mr. Lawrence is terminated without cause, or his position is
eliminated, within the two years following the starting date of his employment,
he is entitled to receive nine months of his then current salary as severance.
We entered into a severance agreement with Lloyd Chasey on May 30, 2000. In the
event Mr. Chasey is terminated without cause, or his position is eliminated,
within the two years following the starting date of his employment, he is
entitled to receive twelve months of his then current salary as severance. We
entered into a severance agreement with Ivano Reali on March 13, 2000. In the
event Mr. Reali is terminated without cause, or his position is eliminated,
within the three years following the starting date of his employment, he is
entitled to receive one year of his then current salary as severance. If Mr.
Reali is terminated without cause following the third anniversary of his
starting date, he is entitled to receive six months salary as severance.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of August 22, 2000
with respect to the beneficial ownership of the outstanding shares of Class A
Common Stock and Class B Common Stock by (i) all persons owning of record, or
beneficially to the knowledge of the Company, more than five percent of the
outstanding shares of any class, (ii) each director and executive officer of
the Company individually, and (iii) all directors and executive officers of the
Company as a group.
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Shares of
Common Stock
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Beneficially Percent
Name Owned Owned
---- ------------ -------
<S> <C> <C>
Walter T. Klenz.......................................... 182,010 **
Robert E. Steinhauer..................................... 81,813 **
Edward B. Sbragia........................................ 94,205 **
Peter F. Scott........................................... 61,101 **
James W. Watkins......................................... 27,000 **
Richard L. Adams......................................... 2,746 **
David Bonderman.......................................... *9,542,007 46.71%
Randy Christofferson..................................... 6,264 **
James G. Coulter......................................... *9,542,007 46.71%
Timm F. Crull............................................ 158,099 **
William A. Franke........................................ 3,144 **
E. Michael Moone......................................... 526,938 2.58%
William S. Price III..................................... *9,542,007 46.71%
Jesse Rogers............................................. 25,109 **
George A. Vare........................................... 207,840 1.02%
Texas Pacific Group and its related entities............. 9,542,007 46.71%
All directors and executive officers as group included
those named above....................................... 11,236,061 55.00%
Wellington Management Company, LLC....................... 1,480,800 7.25%
Capital Research & Management............................ 1,479,600 7.24%
</TABLE>
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* Denotes stock owned by TPG Partners, L.P. and three of its related limited
partnerships ("TPG"). Mr. Bonderman, Mr. Coulter and Mr. Price are officers
of TPG Advisors, Inc., which ultimately controls TPG. Each of them disclaims
beneficial ownership of Shares except to the extent of their respective
proportionate interest in each entity. TPG maintains an office of 301
Commerce Street, Suite 3300, Fort Worth, Texas 76120.
** owns less than 1%.
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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Rutherford Quarry Vineyard, which is owned by a family trust for which Timm
Crull is a trustee, has a long-term crop share agreement with Beringer Wine
Estates Company, as subsidiary of the Company ("BWEC"). During fiscal 2000 the
trust was paid $42,214.51 under this agreement.
William S. Price III controls Sand Hill L.L.C. This company operates Durrell
Vineyards, a well-established and renowned vineyard in the Carneros and Sonoma
Valley appellations of Sonoma Valley appellations of Sonoma County, California.
In fiscal 1998 Mr. Price's company entered into a multi-year agreement with
BWEC to supply grapes from Durrell Vineyards. During fiscal 2000 this company
was paid $244,755.89 for these grapes.
BWEC entered into a warehouse lease agreement in December 1990 with a
partnership in which E. Michael Moone and Walter T. Klenz hold interests. BWEC
paid this partnership rent expense payments of $1,045,671 in fiscal 2000 and
the rent is scheduled to increase in fiscal 2001.
BWEC sold wine in the amount of $13,990 to America West Airlines in fiscal
2000. William A. Franke is Chairman and Chief Executive Officer of America West
Airlines.
The Company made loans to Walter T. Klenz and Edward G. Sbragia in 1996 to
purchase our common and preferred stock. These loans bear interest at the prime
rate and are secured by 21,124 and 12,342 shares, respectively, of common
stock. These loans were paid in full in fiscal 2000. We made a $300,000 loan to
Mr. Watkins on October 15, 1999, payable on October 14, 2005, in connection
with our offer of employment. This loan has an interest rate of 5.8% and
interest is payable on or about September 15 of each year of the term. The
principal balance is forgiven at the rate of $50,000 per year. In the event Mr.
Watkins is terminated for cause, the loan is payable in full within 30 days.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this amended report on
Form 10-K for the fiscal year ended June 30, 2000 to be signed on its behalf by
the undersigned, thereunto duly authorized.
BERINGER WINE ESTATES HOLDINGS, INC.
/s/ Douglas W. Roberts
By __________________________________
Douglas W. Roberts
Vice President, General Counsel
and Secretary
Date: September 1, 2000
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