<PAGE> 1
US SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
Form 10-QSB
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
( )TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF
The EXCHANGE ACT
For the transition period from ____to ___
Commission File Number 33-62038NY
SARATOGA BEVERAGE GROUP, INC.
Delaware 14-1749554
(State of Incorporation) (IRS Employer ID Number)
11 Geyser Road, Saratoga Springs, New York 12866
(518) 584-6363
Check whether issuer (1) filed all reports required to be filed by Section 13 or
15(d) for the Exchange Act during the past 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.
YES X NO ___
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
Common Stock - 1,691,224 shares of Class A Common Stock,
$.01 par value, and 1,036,036 shares of Class B
Common Stock, $.01 par value,
were outstanding as of June 30, 1996
This document contains 13 pages
<PAGE> 2
SARATOGA BEVERAGE GROUP, INC.
FORM 10-QSB
INDEX
<TABLE>
<CAPTION>
Page Number
Part I - FINANCIAL INFORMATION
<S> <C> <C>
Item 1 - Consolidated Financial Statements
Consolidated Balance Sheets as of June 30, 1996 (Unaudited) and 1
as of December 31, 1995
Consolidated Statements of Operations and Accumulated Deficit for 2
the three month and six months ended June 30, 1996 and 1995
(Unaudited)
Consolidated Statements of Cash Flow for the six months ended 3
June 30, 1996 and 1995 (Unaudited)
Notes to Consolidated Financial Statements (Unaudited) 4-5
Item 2 - Management's Discussions and Analysis of Financial Condition and Results of 6-9
Operations
Part II - OTHER INFORMATION
Item 1 - Legal Proceedings 10
Item 2 - Changes in Securities 10
Item 3 - Defaults upon Senior Securities 10
Item 4 - Submission of Matter to a Vote of Security Holders 10
Item 5 - Other Information 10
Item 6 - Exhibits and Reports on Form 8-K 11-12
Signatures 13
</TABLE>
<PAGE> 3
SARATOGA BEVERAGE GROUP, INC.
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
<TABLE>
<CAPTION>
June 30, 1996 December 31, 1995
------------- -----------------
(Unaudited) (a)
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents $ 49,752 $ 352,797
Accounts receivable, net of allowance for doubtful
accounts of $30,000 and $57,540 632,244 286,360
Inventories 318,218 405,208
Prepaid expenses and other current assets 95,054 24,920
----------- -----------
Total current assets 1,095,268 1,069,285
Property, plant and equipment, net 1,793,227 1,813,843
Deferred financing costs, net 76,642 85,158
Other assets 18,266 22,090
----------- -----------
Total assets $ 2,983,403 $ 2,990,376
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts Payable and accrued liabilities $ 692,180 $ 662,995
Short-term debt 59,992
Short-term debt - Currently callable 13,700
Long-term debt - Currently callable 91,000
Current portion of obligation under capital lease 5,077
----------- -----------
Total current liabilities 710,957 813,987
Long-term debt:
Obligation under capital lease 11,308
Revolving credit facility 100,000
----------- -----------
Total long-term debt 111,308
Total liabilities 822,265 813,987
----------- -----------
Commitments and contingencies
Stockholders' Equity
Preferred Stock, $.01 par value; 5,000,000 shares authorized,
no shares issued and outstanding
Class A Common Stock, $.01 par value; 50,000,000 shares
authorized; 1,691,224 issued and outstanding in 1996 and
outstanding in 1995 16,912 16,863
Class B Common Stock, $.01 par value, 2,000,000 shares
authorized, 1,036,036 shares issued and outstanding in 1996 10,360 10,410
and 1,042,036 issued and outstanding in 1995
Paid-in capital 9,247,247 9,268,874
Accumulated deficit (7,113,381) (7,119,758)
----------- -----------
Total stockholders' equity 2,161,138 2,176,389
----------- -----------
Total liabilities and stockholders' equity $ 2,983,403 $ 2,990,376
=========== ===========
</TABLE>
(a) Condensed from audited financial statements.
The accompanying notes are an integral part of the consolidated financial
statements
1
<PAGE> 4
SARATOGA BEVERAGE GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND ACCUMULATED DEFICIT
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenue:
Product Sales $ 1,249,955 $ 735,798 $ 1,794,405 $ 1,598,295
Co-pack Revenue 244,098 141,286 452,514 141,286
----------- ----------- ----------- -----------
Total Revenue 1,494,053 877,084 2,246,919 1,739,581
Cost of Goods Sold, exclusive of
depreciation and amortization shown
separately below 867,575 593,121 1,302,976 1,290,244
----------- ----------- ----------- -----------
Gross Profit 626,478 283,963 943,943 449,337
----------- ----------- ----------- -----------
Operating Expenses:
Marketing and sales 285,238 231,987 390,696 322,693
General and administrative 205,659 259,940 401,132 511,408
Depreciation and amortization 92,764 83,645 182,607 167,085
----------- ----------- ----------- -----------
583,661 575,572 974,435 1,001,186
----------- ----------- ----------- -----------
Operating Income (Loss) 42,817 (291,609) (30,492) (551,849)
----------- ----------- ----------- -----------
Other Income (Expense):
Commission Income 18,599 45,070 40,566 62,743
Interest income 597 9,413 3,779 9,870
Interest expense (4,792) (7,476) 2,727
Net (loss) on disposal of equipment (5,392)
----------- ----------- ----------- -----------
Other Income (Expense) 14,404 54,483 36,869 69,948
----------- ----------- ----------- -----------
Net Income (loss) 57,221 (237,126) 6,337 (481,901)
Accumulated Deficit:
Beginning of period (7,170,602) (6,441,103) (7,119,758) (6,196,328)
----------- ----------- ----------- -----------
End of Period $(7,113,381) $(6,678,229) $(7,113,381) $(6,678,229)
=========== =========== =========== ===========
Per Share Information:
Primary earnings per share $ 0.01 $ (0.09) $ 0.00 $ (0.18)
Fully-diluted earnings per share $ 0.01 $ 0.00
Weighted average number of common and
equivalent shares outstanding
Primary 4,224,297 2,626,179 4,224,297 2,625,081
Fully diluted 4,227,510 4,227,510
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
2
<PAGE> 5
SARATOGA BEVERAGE GROUP, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Six Months Six Months
Ended Ended
June 30, 1996 June 30, 1995
------------- -------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (loss) $ 6,377 $(481,901)
Adjustment to reconcile net income (loss) to cash
used in operating activities:
Depreciation and amortization 182,607 167,085
Provision for doubtful accounts (27,540) 10,000
Net loss (gain) on sale of equipment 5,391
Changes in operating assets and liabilities:
Accounts receivable (318,344) (125,713)
Inventories 86,990 7,629
Prepaid expenses and other current assets (70,134) (44,774)
Accounts payable and accrued liabilities 29,185 89,261
--------- ---------
Net cash used in operating activities (110,859) (373,022)
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of equipment 4,500
Purchase of property, plant, and equipment (152,081) (10,129)
Decrease (increase) in other assets 2,429 (3,500)
--------- ---------
Net cash used in investing activities (149,652) (9,129)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from short-term borrowings 80,000
Proceeds from capital lease obligations 18,393
Proceeds from long-term borrowings 100,000
Principal payments on long-term borrowings (77,300) (31,850)
Principal reductions on capital lease obligation (2,007) (5,151)
Principal payments on short-term borrowings (59,992)
Proceeds from exercise of stock options 24,798
Distribution of minority interest (21,628) (107,253)
--------- ---------
Net cash used in financing activities (42,534) (39,456)
--------- ---------
Decrease in cash and cash equivalents (303,045) (421,607)
Cash and cash equivalents at beginning of period 352,797 985,440
--------- ---------
Cash and cash equivalents at end of period $ 49,752 $ 563,833
========= =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION
Interest Paid during the period $ 4,921 $ 1,334
========= =========
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
3
<PAGE> 6
SARATOGA BEVERAGE GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-QSB. Accordingly, they do not include all
of the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring adjustments) considered necessary
for a fair presentation have been included. Operating results for the
three-month and six month periods ended June 30, 1996 are not necessarily
indicative of the results that may be expected for the year ended December 31,
1996.
The accompanying financial statements include Saratoga Beverage Group,
Inc., and its wholly-owned subsidiary, Saratoga Springs Distribution
Corporation. Saratoga Springs Distribution Corporation owns a 51% interest in
Sample New Age Distributors ("Sample," a non-operating partnership in 1996 and
1995).
Certain items have been reclassed from general and administrative
expense to cost-of-goods sold in 1995 to conform with the 1996 presentation.
2. WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING
The calculations of weighted average shares of common and common stock
equivalents excludes outstanding options and warrants in 1995, since these
securities effect on per share data is anti-dilutive and include certain options
and warrants in 1996 because of their dilutive effect on per share data.
3. RELATED PARTY TRANSACTIONS
Included in cash and cash equivalents at June 30, 1996 is approximately
$16,767 of cash equivalents invested in a money market account with Dean Witter
Reynolds, Inc. A principal stockholder of the Company is an officer of Dean
Witter Reynolds, Inc.
The Company signed a Sales and Marketing Services Agreement with Royal
Crown Company, Inc. ("RCC"), a wholly-owned subsidiary of Triarc Companies, Inc.
("Triarc"), in May 1995 wherein RCC handles all sales and marketing in return
for a fee of $.50 on each case sold of the Company's branded product. The
Company incurred commissions totaling $144,444 for the twelve month period ended
June 30, 1996, of which $30,994 remained unpaid at June 30, 1996. The Company
also entered into a Credit Agreement with Triarc dated July 13, 1995 pursuant to
which Triarc agreed to supply the Company with $3,000,000 revolving credit
facility in return for warrants to purchase 51% of the Company's outstanding
stock on a fully-diluted basis. The note is collateralized by substantially all
of the assets of the Company. In February 1996 the Company borrowed $100,000
against the revolving credit facility and incurred $3,819 of interest expense
for the six month period ending June 30, 1996, all of which was paid in July
1996.
4
<PAGE> 7
4. PROPERTY, PLANT, EQUIPMENT AND INTANGIBLE ASSETS
Property, plant, equipment and intangible assets are carried at a cost
less allowances for accumulated depreciation and amortization. The cost of
properties held under capital leases is equal to the lower of the net present
value of the minimum lease payments or the fair market value of the leased
property at the inception of the lease. Significant additions or improvements
extending the assets' useful lives are capitalized. Normal maintenance and
repair costs are expensed as incurred. When assets are sold, retired, or
otherwise disposed of, the applicable costs and accumulated depreciation are
removed from the accounts and resulting gain or loss recognized.
Organizational and trademark costs are included in the caption "Other
assets." These costs are amortized over periods of 5 to 15 years on the
straight-line basis. Deferred financing costs are amortized over five years, the
life of the related credit agreement. When intangible assets become fully
amortized, the applicable costs and accumulated amortization are removed from
the accounts.
The Company evaluates impairment of intangible and long lived assets
whenever circumstances indicate that the carrying amount of the assets exceeds
its fair value.
5
<PAGE> 8
SARATOGA BEVERAGE GROUP, INC.
FORM 10-QSB
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND
RESULTS OF OPERATION
BUSINESS
GENERAL
The Company is primarily engaged in the bottling, marketing and
distribution of natural spring and mineral water products from naturally
free-flowing springs located on the Company's property in Saratoga Springs, New
York and in the packaging of products for others (co-packing). The Company's
product line currently includes five water products, including a sparkling
spring water product, three sparkling essence-flavored spring water products and
a non-carbonated spring water product. All of the Company's products are
marketed as premium domestic bottled water under the proprietary name
"Saratoga." The Saratoga brand name has been in existence for over 120 years.
The Company's springs and bottling facilities have been operated
through the years by a number of owners, including Anheuser-Busch and, most
recently, Evian Waters of France, a division of BSN, S.A. Anheuser-Busch and
Evian Waters of France each operated the business for approximately two years.
The Company was organized and acquired the assets of its business in April 1992
from the owners of Evian Waters of France. The Company's bottling facilities,
which had been closed since May 1991 by the previous owners, recommenced
operations in May 1992. Since that time, the Company has undertaken the task of
rebuilding a distribution network and customer base for the Saratoga brand
beverage products.
TRIARC ALLIANCE
On December 13, 1995, the Company consummated a strategic alliance with
Triarc, a publicly-held company listed on the New York Stock Exchange. The
Company and Triarc previously entered into a Credit Agreement, dated as of July
13, 1995, which provides for a five-year secured revolving credit facility (the
"Credit Facility") with borrowings of up to $3,000,000. Pursuant to the Credit
Facility, Triarc will provide an aggregate principal amount outstanding at any
one time of up to $3,000,000; however, Triarc will not make any loans during any
calendar quarter in excess of $250,000 unless (i) after giving effect to such
loan the aggregate principal amount of all indebtedness under the Credit
Facility does not exceed the borrowing base (as described below) or (ii) a
committee (the "Loan Committee"), comprised of a representative of each of
Triarc, RCC, and the Company determines that loans in excess of $250,000, and in
excess of the borrowing base, should be made. The borrowing base, as of a given
date, will consist of (a) 85% of the aggregate amount of eligible receivables at
such date plus (b) 60% of the aggregate value of eligible inventory at such
date; however, the portion of the borrowing base attributable to eligible
inventory may not exceed 60% of the borrowing base (and will be reduced to the
extent that it would otherwise exceed 60%). A condition precedent to any
borrowings under the Credit Facility is that the aggregate cash and permitted
investments held by the Company is less than $100,000 throughout the ten (10)
business days immediately preceding the date of any loan, unless the Loan
Committee decides otherwise.
In connection with the Credit Agreement, the Company executed a
Security Agreement and a Mortgage. The Security Agreement grants Triarc a
security interest in substantially all of the assets of the Company, including
accounts receivable, inventory, general intangibles, equipment, documents and
intellectual property of the Company. The Mortgage grants Triarc a first
security mortgage interest in the Company's premises and facilities in Saratoga
Springs, New York.
6
<PAGE> 9
Borrowings under the Credit Facility will bear interest at a rate per
annum equal to the prime rate plus 2% if paid in cash quarterly, or the prime
rate plus 3% if not paid in cash quarterly. The entire principal amount
outstanding under the Credit Facility is due December 12, 2000 and may become
due immediately upon the occurrence of an event of default.
The Credit Agreement contains certain covenants and conditions which,
among other things, (i) prohibit the payment of dividends, (ii) prohibit
fundamental changes (including certain types of mergers, consolidations,
dispositions, acquisitions, or dissolutions), (iii) require a minimum
consolidated tangible net worth of the Company of $1,500,000, less reductions in
consolidated tangible net worth incurred as a result of the Triarc transactions,
(iv) require the maintenance of corporate existence, (v) require compliance with
governmental and regulatory rules and regulations, (vi) require the maintenance
of insurance and (vii) place limitations on future liens, indebtedness,
investments, transactions with affiliates and the creation of subsidiaries.
As consideration for the execution of the Credit Agreement by Triarc
and the execution of the Sales and Marketing Services Agreement as described
below by RCC, the Company issued two warrants to Triarc: (I) one Non-Callable
Warrant A (the "A Warrant") to purchase a number of shares of Common Stock which
would equal 25% of the total number of shares of Common Stock outstanding on a
fully-diluted basis on the date of exercise, at an exercise price of $.01 per
share, and (ii) one Non-Callable Warrant B (the "B Warrant") to purchase a
number of shares of Common Stock which would equal 26% of the total number of
shares of Common Stock outstanding on a fully-diluted basis on the date of
exercise, at an exercise price of $3.50 per share. The exercise price of the B
Warrant is subject to a reduction from $3.50 per share to $2.46 per share if the
Company sells more than 1,250,000 cases of the Company's branded product (i.e.
"Saratoga" products) during the 12-month period prior to the date of exercise of
the B Warrant. During the twelve month period ended June 30, 1996, 388,888 cases
of the Company's branded product were sold. Both Warrants are exercisable in
whole, but not in part, at any time prior to December 12, 2000; however, the B
Warrant may not be exercised prior to the exercise by Triarc of the A Warrant.
SALES AND MARKETING SERVICES AGREEMENT
Effective May 1, 1995, the Company and RCC entered into a five-year
Sales and Marketing Services Agreement, in which the Company appointed RCC as
its sole and exclusive sales agent for the purpose of selling the Company's
products and RCC accepted such appointment. In connection therewith, RCC agreed
to use commercially reasonable efforts at all times to promote the sale of the
Company's products, including servicing and soliciting retailers, wholesalers,
distributors, and national accounts, and to provide advice and assistance
relating to the marketing of the Company's products, including advice regarding
branding, packaging and positioning for the product, design of trade promotions
and advertising, public relations, and the establishment of relationships with
distributors and the pricing of products to distributors. RCC is required to
stay informed of the conditions in the markets for the Company's products
including, in particular, pricing, trade statistics and demand forecasting by
product and package and shall provide such data to the Chief Executive Officer
and Board of Directors (or duly appointed committee thereof) of the Company on a
monthly basis. In addition, RCC will provide consulting services with respect to
financial and operational issues. In return for such services, the Company will
pay RCC a commission of $.50 per case of products sold by the Company.
After completion of the five-year term, the Sales and Marketing
Services Agreement will continue for successive one-year periods unless the
Company or RCC give notice of its intent not to renew six months prior to the
expiration of the term.
CO-PACKING
During the first quarter of 1995, the Company was selected by Cott USA,
Inc. to co-pack Cott's private label spring water products at its Saratoga
Springs bottling facility. Cott Corp., Cott USA, Inc.'s parent company, is the
nation's largest producer of retailer brand carbonated soft drinks and other
beverages. Actual co-packing began in April 1995.
7
<PAGE> 10
RESULTS OF OPERATIONS
The following is management's discussion and analysis of certain
significant factors which have affected the Company's financial position and
operating results for the three and six month periods ended June 30, 1996.
NET REVENUE
Net revenue for the three month period ended June 30, 1996 was
$1,494,053, an increase of $616,969 or 70%, as compared to net revenue of
$877,084 for the same period in 1995. Net revenue for the six month period ended
June 30, 1996 was $2,246,919, an increase of $507,338 or 29% as compared to net
revenue of $1,739,581 for the same period in 1995. The increase for both the
three and six month periods is primarily attributable to a substantial increase
in both Saratoga branded product sales and co-pack revenue during the second
quarter of $514,157 (70%) and $102,812 (73%) respectively.
GROSS PROFIT
The gross profit margin, exclusive of depreciation and amortization,
was 42% for both the three and six month periods ended June 30, 1996 and 32% and
26% for the comparable periods ended June 30, 1995. The increased gross profit
margins are primarily attributable to a decrease in the fixed cost per case
resulting from increased volume of cases produced.
MARKETING
Marketing and selling expenses increased $53,251 and $68,003 to
$285,238 and $390,696, or 19% and 17% of net sales, for the three and six month
periods ended June 30, 1996, respectively. This compares with $231,987 and
$322,693, or 26% and 19% of net sales for the comparable 1995 periods,
respectively. The increase in marketing and sales expenses for the three and six
month periods ended June 30, 1996 is attributable to: (i) increased discounts on
distributor sales and (ii) increased commissions accrued for RCC as part of the
Sales and Marketing Services Agreement, both of which are a result of the
increase in sales.
GENERAL AND ADMINISTRATIVE
General and administrative expenses for the three and six month periods
ended June 30, 1996 were $205,659 and $401,132, respectively, a decrease of
$54,281 (21%) and $110,276 (22%) from the same periods in 1995. This decrease
for both the three and six month periods is primarily attributable to a
reduction in certain insurance expenses, utilities, bad debt expense, and the
Company's ongoing cost-cutting program.
OTHER INCOME AND EXPENSE
Net other income for the three and six month periods ended June 30,
1996 decreased $40,079 and $33,079, respectively, from the same periods in 1995.
The decrease for both the three and six month periods is primarily attributable
to: (i) a $26,471 and $22,177 decrease in commission income; and (ii) an $8,816
and $8,818 decrease in interest income, and a $4,792 and $7,476 increase in
interest expense, respectively. The decrease in commission income is due to the
decrease of $.50 per case in royalties beginning in February 1996. The royalties
are generated from the sale of the Mistic Distribution Agreement by Sample in
the first quarter of 1995. The decreases in interest income for the three and
six month periods is primarily attributable to a decline in capital available
for investment. The increase in interest expense for the three and six month
periods is primarily attributable to a reduced interest subsidy from the NYS
Energy Office in 1996 and interest incurred in 1996 on the newly acquired
Revolving Credit Facility.
8
<PAGE> 11
NET INCOME AND LOSS
Net income for the three and six month period ended June 30, 1996 was
$57,221 and $6,377, respectively, an increase of $294,347 and $488,278,
respectively. The net income for the three and six month periods is primarily
attributable to the substantial increase in sales, an overall decrease in cost
of goods sold as a percentage of sales with operating expenses remaining stable,
partially offset by the decrease in other income.
LIQUIDITY AND CAPITAL RESOURCES
For the six months ended June 30, 1996 and 1995, cash flows used in
operating activities were $110,859 and $373,022, respectively. At June 30, 1996,
cash and cash equivalents was $49,752, while working capital was $384,311. The
current ratio at June 30, 1996 was 1.54 : 1. The Company believes that it has
sufficient liquidity to meet anticipated needs for the next twelve (12) months.
However, there can be no assurance that, after such time, the Company will
achieve the sales and maintain the profitability necessary to generate
sufficient cash flow for its operations.
The Company has a $3,000,000 line of credit with the Triarc (see Item
2, Business) of which $100,000 was borrowed in February 1996 and remains
outstanding at June 30, 1996.
Debt includes the outstanding balance of $13,700 on a bank loan used
for the acquisition of equipment and is collateralized by that equipment. The
loan agreement contains various restrictive covenants requiring, among other
matters, the maintenance of a minimum current ratio of 2:1 and net worth of $4.8
million. As of June 30, 1996, the Company was not in compliance with the current
ratio or the net worth covenant. The Company's intention is to continue to make
monthly installments of approximately $4,550 principal, plus interest. As of
August 14, 1996, all installments were current. Management believes the lack of
compliance with the net worth covenant will have no effect on the results of
operation and financial condition as long as the monthly installments are
current. The outstanding balance on this loan will be paid by December 31, 1996.
There are no material commitments or contingencies at this time not
disclosed in the financial statements.
9
<PAGE> 12
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
NONE.
ITEM 2 - CHANGES IN SECURITIES
NONE.
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
NONE.
ITEM 4 - SUBMISSIONS OF MATTERS TO A VOTE OF SECURITY HOLDERS
The annual meeting of the stockholders was held on June 26, 1996 for
the following purposes:
1. To elect directors of the Company by holders of Class A and
Class B Common Stock.
The directors elected were: Peter R. Campbell, Alan G.
Leyland, Warren Lichtenstein, John A. Morabito, Robin Prever,
Kenneth A. Thomas, and Leonard Toboroff.
All of the directors received 4,602,303 votes cast for and
7,122 cast against, with no abstentions, except for Robin
Prever, who received 4,600,703 votes cast for and 8,722 cast
against, with no abstentions.
2. To ratify the appointment of Coopers and Lybrand, L.L.P., as
auditors for the Company for the fiscal year ending December
31, 1996.
There were 4,603,671 votes cast for, 3,100 votes cast against
and 2,654 abstentions.
Stockholders of record at the close of business on May 17, 1996 were
entitled to vote at the meeting or any adjournment thereof.
ITEM 5 - OTHER INFORMATION
NONE.
10
<PAGE> 13
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
(a) The following documents are filed as part of this report:
1. Exhibits included herein:
a) Exhibits and Index
Exhibit No.
2.1* Agreement and Plan of Merger
3.1* Restated Certificate of Incorporation of the Company
3.2* By-Laws of the Company
4.1* Specimen of Class A Common Stock Certificate
4.2*** Non-Callable Warrant A dated December 13, 1995 by the Company
to Triarc to purchase 25% of the number of shares of Class A
Common Stock of Saratoga then issued and outstanding, on a
fully-diluted basis
4.3*** Non-Callable Warrant B dated December 13, 1995 by the Company
to Triarc to purchase 26% of the number of shares of Class A
Common Stock of Saratoga then issued and outstanding, on a
fully-diluted basis
4.4* Form of Underwriter's Warrant
4.5* Form of Escrow Agreement entered into by the current
stockholders of the Company and the Underwriter
9.1* Agreement, dated August 12, 1992, by and between Anthony
Malatino and Robin Prever, as amended by Amendment No. 1
thereto dated as of April 30, 1993
1-.1* Asset Purchase Agreement, dated as of March 31, 1992, by and
between Saratoga Springs Mineral Water Company and Mineral
Springs Acquisition Group, Inc.
10.2* General Assignment and Bill of Sale, dated April 3, 1992, by
Saratoga Springs Mineral Water Company to Mineral Springs
Acquisition Group, Inc.
10.3* Assignment and Assumption Agreement, dated April 3, 1992, by
and between Saratoga Springs Mineral Water Company and Mineral
Springs Acquisition Group, Inc.
10.4* Assignment, dated April 3, 1992, by Saratoga Springs Mineral
Water Company to Mineral Springs Acquisition Group, Inc.
10.5* Assignment, dated April 3, 1992, by Saratoga Springs Mineral
Water Company to Mineral Springs Acquisition Group, Inc.
10.6* Letter Agreement, dated as of May 1, 1993, by and between the
Company and Mark Wiggins
10.7** Employment Agreement, entered into by the Registrant and Robin
Prever
10.8* Form of the Saratoga Spring Water Company 1993 Stock Option
Plan
10.9** Consulting Agreement entered into by the Company and Leonard
Toboroff
10.10* Form of consulting agreement entered into by the Company and
the Underwriter
10.11* Note, dated August 31, 1992, from the Company to Fleet Bank of
New York, including guarantees
10.12* Letter from Fleet Bank of New York to the Company regarding
waiver of defaults
10.13* Letter Agreement between the Company and Owens-Brockway Glass
Containers
10.14* Form of Mergers and Acquisitions Agreement entered into by the
Company and the Underwriter
10.15** Partnership Agreement, dated July 21, 1993, by and between JNJ
Distributors, Inc. and Saratoga Springs Distribution Corp., as
amended by Amendment of Partnership Agreement thereto dated
November 9, 1993
10.16** Stock agreement, dated July 21, 1993, by and between JNJ
Distributors, Inc. and Saratoga Spring Water Company
10.17** Distribution Agreement, dated March 25, 1993, by and between
Joseph Victori Wines, I Inc. and JNJ Distributors, Inc.
10.18*** Credit Agreement, dated as of July 13, 1995, by and between
the Company and Triarc
11
<PAGE> 14
10.19*** Amendment, Waiver and Acknowledgment Agreement, dated as of
December 13, 1995, by and between the Company and Triarc
10.20*** Sales and Marketing Services Agreement, dated as of May 1,
1995, between the Company and RCC
10.21*** Cott Co-pack Agreement, dated as of June 8, 1995
22** Subsidiaries
24*** Power of Attorney
27**** Financial Data Schedule for the six months ended June 30, 1996
(*) Incorporated herein by reference to the Company's
Registration Statement on Form SB-2 filed with the Commission
on June 16, 1993 (Registration No. 33-62038NY)
(**) Incorporated herein by reference to the Company's form
10-KSB filed with the Commission on March 30, 1994
(***) Incorporated herein by reference to the Company's Form
10-KSB filed with the Commission on March 29, 1996
(****) Filed herewith
(b) Reports on From 8-K: No reports on Form 8-K were filed in the quarter ended
June 30, 1996
12
<PAGE> 15
SIGNATURES
IN ACCORDANCE WITH THE REQUIREMENTS OF THE EXCHANGE ACT, THE REGISTRANT CAUSED
THIS REPORT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREINTO DULY
AUTHORIZED.
SARATOGA BEVERAGE GROUP, INC.
(REGISTRANT)
DATE: AUGUST 13, 1996 BY: /s/ ROBIN PREVER
---------------- ------------------------------
ROBIN PREVER
CHIEF EXECUTIVE OFFICER
DATE: AUGUST 13, 1996 BY: /s/ ANTHONY PRINCIPE
--------------- ------------------------------
ANTHONY PRINCIPE
CHIEF FINANCIAL OFFICER
13
<PAGE> 16
INDEX TO EXHIBITS
EXHIBIT NO.
------- ---
Financial Data Schedule................................... 27
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE JUNE 30,
1996 FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 49,752
<SECURITIES> 0
<RECEIVABLES> 662,244
<ALLOWANCES> 30,000
<INVENTORY> 318,218
<CURRENT-ASSETS> 1,095,268
<PP&E> 2,958,957
<DEPRECIATION> 1,165,730
<TOTAL-ASSETS> 2,983,403
<CURRENT-LIABILITIES> 710,957
<BONDS> 111,308
0
0
<COMMON> 27,272
<OTHER-SE> 2,133,866
<TOTAL-LIABILITY-AND-EQUITY> 2,983,403
<SALES> 2,246,919
<TOTAL-REVENUES> 2,291,264
<CGS> 1,302,976
<TOTAL-COSTS> 1,693,672
<OTHER-EXPENSES> 583,739
<LOSS-PROVISION> 922
<INTEREST-EXPENSE> 7,476
<INCOME-PRETAX> 6,337
<INCOME-TAX> 0
<INCOME-CONTINUING> 6,337
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,337
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
