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 October 20, 2000
reported) ---------------------------------------
AMERICAN ITALIAN PASTA COMPANY
--------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 001-13403 84-1032638
--------------------------------------------------------------------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
4100 N. Mulberry Drive, Suite 200 Kansas City, Missouri 64116
--------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including (816) 584-5000
area code -----------------------------------
1000 Italian Way, Excelsior Springs, Missouri 64024
--------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE>
Item 5. Other Events.
As previously announced, AIPC has entered into a definitive agreement to
purchase the Mueller's brand pasta business from Bestfoods. Today the Company
announced further details of the transaction.
PURCHASED ASSETS. Mueller's is the largest single pasta brand in the United
States, with particularly strong distribution in the eastern part of the
country. The acquisition emcompasses the trademarks and goodwill associated with
the brand, the customer accounts and relationships, and certain tangible assets,
primarily inventory. Tangible assets purchased are expected to be approximately
$6 million.
PURCHASE PRICE. Total consideration for the purchased assets, excluding
tangible assets, is approximately $38.2 million, consisting of $17.6 million in
cash and 686,666 shares of common stock valued at $30 per share. On the date of
the agreement (October 4, 2000), the current value of the consideration was
$29.8 million based on a share price of $19.50.
The contract calls for a target price of $30 per share to be realized by
Bestfoods from sale of the shares. The Company has agreed to register the shares
shortly after the transaction closes. Bestfoods may then sell the shares in open
market or negotiated transactions, and is contractually obligated after one year
from the closing date to use reasonable best efforts to sell the shares for the
target price of $30 per share. For shares sold by Bestfoods after two years, but
less than three years after the closing date, the Company has agreed to a
make-whole cash payment to Bestfoods related to any shares sold for less than
the target price of $30. Any payments made by AIPC under this provision will
lead to adjustments to the equity accounts of AIPC and will not affect purchase
price, goodwill, or the Company's earnings. The Company may call the shares at
any time for $30 per share.
The Company will finance the cash portion of the acquisition price from its
current debt facility.
BUSINESS VALUE PROTECTIONS AND TIMING. To assure Mueller's business value
is protected, Bestfoods has agreed to maintain all marketing and trade
promotions at budgeted levels through the closing and, for up to 90 days after
closing, to provide the Company with transition services. In addition, the
purchase agreement contains sales volume protections through the closing. The
transaction is expected to close in AIPC's first fiscal quarter, subject to
normal regulatory review. AIPC has agreed to honor Bestfood's marketing
commitments through April 2001; therefore, any major strategic changes to the
business will not occur until in the second half of AIPC's fiscal year 2001.
<PAGE>
SIGNATURE
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.
Date: October 20, 2000
AMERICAN ITALIAN PASTA COMPANY
By:
/s/ Timothy S. Webster
Timothy S. Webster,
President and Chief Executive
Officer
