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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
(AMENDMENT NO. 2)*
Under the Securities Exchange Act of 1934
Saratoga Beverage Group, Inc.
-----------------------------------------
(Name of Issuer)
Common Stock, $.01 par value
-----------------------------------------
(Title of Class of Securities)
803436 10 4
-----------------------------------------
(CUSIP Number)
Anthony Malatino
c/o Morgan Stanley Dean Witter & Company
340 Broadway
Saratoga Springs, NY 12866
-----------------------------------------
(Name, Address and Telephone Number
of Person Authorized to
Receive Notices and Communications)
October 13, 1998
-----------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of ss.ss. 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check
the following box: [ ].
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See ss. 240.13d-7(b) for other
parties to whom copies are to be sent.
* The remainder of this cover page shall be filling out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
Page 1 of 19 sequentially numbered pages.
Exhibit index is located on page 8.
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SCHEDULE 13D
- -------------------------------------------------------------------------------
CUSIP No. 803436 10 4 Page 2 of 19 Pages
- -------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Anthony Malatino
- -------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [ ]
- -------------------------------------------------------------------------------
3 SEC USE ONLY
- -------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF
- -------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or 2(e) [ ]
- -------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
- -------------------------------------------------------------------------------
7 SOLE VOTING POWER
0
-------------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY 450,995
OWNED BY -------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 450,995
WITH -------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- -------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
450,995
- -------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* [ ]
- -------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
14.2%
- -------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- -------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE
ATTESTATION.
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SCHEDULE 13D
AMENDMENT NO. 2
This Amendment No. 2 to the Statement on Schedule 13D amends
and supplements the Statement on Schedule 13D with an event date of July 30,
1997 ("Schedule 13D") and Amendment No.1 to the Schedule 13D with an event date
of April 17, 1998 ("Amendment No. 1"), which amended and supplemented the
Schedule 13D originally filed by Anthony Malatino and Robin Prever with the
Securities and Exchange Commission (the "SEC") on August 17, 1995, as amended
by Amendment No. 1 to the Schedule 13D with an event date of June 17, 1997,
relates to the beneficial ownership of shares of the Class A Common Stock, $.01
par value per share (the "Class A Common Stock"), of Saratoga Beverage Group,
Inc. (the "Issuer").
ITEM 2. IDENTITY AND BACKGROUND
Items 2(b) and 2(c) of the Schedule 13D is hereby amended to
read in their entirety as follows:
(b) The principal address and/or office of the Reporting
Person is c/o Morgan Stanley Dean Witter & Company, 340 Broadway, Saratoga
Springs, NY 12866.
(c) The Reporting Person is a Senior Vice President,
Investments of Morgan Stanley, Dean Witter & Company in the firm's Saratoga
Springs, New York office located at 340 Broadway, Saratoga Springs, NY 12866.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
Item 5 of the Schedule 13D is hereby amended to read in its
entirety as follows:
(a) The Reporting Person is the beneficial owner of 450,995
shares (14.2%) of Class A Common Stock and Class B Common Stock, $.01 par value
per share (the "Class B Common Stock" and, together with the Class A Common
Stock, the "Common Stock"), of the Issuer. The number of shares of Common Stock
beneficially owned by the Reporting Person and the percentage of outstanding
shares represented thereby have been computed in accordance with Rule 13d-3.
The percentage of shares of Common Stock beneficially owned by the Reporting
Person has been calculated based upon 3,169,094 shares of Common Stock
outstanding at September 15, 1998.
(b) Except as set forth in this paragraph (b), the Reporting
Person has the sole power to vote or to direct the vote of, and dispose or
direct the disposition of, 450,995 shares of Common Stock.
(i) On October 13, 1998, the Reporting Person, Robin
Prever, the President and Chief Executive Officer of the
Issuer, and Steven Bogen, the President and Chief Executive
Officer of The Fresh Juice Company, Inc., entered into a
Stockholder Agreement. Pursuant to the Stockholder Agreement,
the Reporting Person and Ms. Prever each agreed to vote all
of his or her shares of Common Stock to elect, re-elect and
prevent any purposed removal of Mr. Bogen as a member of the
Issuer's Board of Directors. In addition, the Reporting
Person and Ms. Prever have appointed Mr. Bogen as their true
and lawful proxy and attorney-in-fact to vote the shares of
Common Stock then owned by them for the election of the Mr.
Bogen as a director of Saratoga in the event that they do not
vote to elect, re-elect and prevent any purposed removal of
Mr. Bogen as a member of the Issuer's Board of Directors. The
Stockholder Agreement expires on the earliest to occur of the
date: (w) after
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the effective date of the merger of the Issuer and The Fresh
Juice Company, Inc. that Mr. Bogen directly owns less than
400,000 shares of Class A Common Stock, (x) the termination
of the merger agreement among the Issuer, and The Fresh Juice
Company, Inc. by any party thereto pursuant to the terms
thereof, (y) Mr. Bogen is convicted of a felony or a
misdemeanor involving moral turpitude, dishonesty, theft or
and unethical conduct, or (z) Mr. Bogen breaches his
fiduciary duties, in a material fashion, to the Issuer and
its Stockholders. Mr. Bogen does not have the power to
dispose and direct the disposition of the Reporting Person's
shares of Common Stock.
(ii) On October 22, 1998, the Reporting Person and
Robin Prever entered into a Stockholders' Agreement. Pursuant
to the Stockholders' Agreement, the Reporting Person and Ms.
Prever each agreed that, upon the death of one of them, the
surviving person shall have an option, exercisable within
ninety (90) after the death of the decedent, to purchase all
or a portion of the shares of Class B Common Stock then owned
by the decedent. The purchase price for each share of Class B
Common Stock then owned by the decedent shall be equal to the
greater of (i) the average Fair Market Value (as defined in
the Stockholders' Agreement) of the Class A Common Stock of
the Issuer for twenty (20) consecutive trading days ending
one (1) business day before the date of the notice of
purchase (the "Closing Date") and (ii) if the shares of Class
A Common Stock are publicly traded, an amount equal to eight
times (8x) the published fully diluted earnings per share of
the Issuer for the four fiscal quarters prior to the date of
the notice of purchase. The purchase price shall be made by
certified check, by wire transfer or by a promissory note
secured by the shares of Class B Common Stock acquired. The
Closing Date shall be within sixty (60) days following the
date of notice of exercise of the option. For purposes of the
charter of the Issuer, the purchase of the shares of Class B
Common Stock by the surviving person shall be deemed to have
occurred immediately prior to the decedent's death. Until the
death of both the Reporting Person and Ms. Prever or until
one of them no longer owns any shares of Class B Common
Stock, from and after the death of a decedent, (x) the
surviving person shall have the right to vote the shares of
Class B Common Stock of the decedent in a manner determined
by the surviving person, in his or her sole and absolute
discretion, and (y) the decedent shall appoint the surviving
person to act as the decedent's true and lawful proxy and
attorney-in-fact to vote the shares of Class B Common Stock
upon the failure of the decedent's estate to vote in a manner
determined by the surviving person. Pursuant to the
Stockholders' Agreement, the Reporting Person and Ms. Prever
also each agreed that, if at any time on or after the date of
the Stockholders' Agreement either of them (a "Selling
Stockholder") desires to sell, pledge, gift or otherwise
transfer all or any portion of the shares of Class B Common
Stock owned by the Selling Stockholder to any person other
than the other party to the Stockholders' Agreement or on the
open securities markets, the Selling Stockholder shall have
the irrevocable and exclusive right of first refusal to
purchase all or a portion of such shares of Class B Common
Stock at a purchase price in cash equal to the price offered
by the third party or, in the event of a gift by a Selling
Stockholder, the right of first refusal shall be at a
purchase price in cash equal to the average fair market value
of the Class A Common Stock for twenty (20) consecutive
trading days ending one (1) business day before the date of
the notice of a proposed sale of shares by the Selling
Stockholder was delivered. If the right of first refusal to
purchase the shares of Class B Common Stock is accepted, the
closing of such purchase shall be not more than five (5)
business days after the date on which the notice of a
proposed sale of shares by the Selling Stockholder was
delivered.
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(c) Schedule I indicates the transactions effected by the
Reporting Person in the Common Stock since the filing of Amendment No. 1. All
such trades were purchases effected through the public market except as
otherwise noted in Schedule I.
(d) Not applicable.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER
Item 6 of the Schedule 13D is supplemented by the
descriptions of the Stockholder Agreement and the Stockholders' Agreement
provided in Item 5 above.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Exhibit A Stockholder Agreement dated as of October
13, 1998 by and among the Issuer, the
Reporting Person, Steven Bogen and Robin
Prever.
Exhibit B Stockholders' Agreement dated as of
October 22, 1998 by and among the Reporting
Person and Robin Prever.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
Dated: October 22, 1998
/s/ Anthony Malatino
----------------------
Anthony Malatino
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SCHEDULE I
Date Aggregate Share Amount Price Per Share ($) Net Amount ($)
- ---- ---------------------- ------------------- --------------
09/11/98 6,000 2.4375 14,956.42
10/08/98 5,000 2.00 10,231.85
10/09/98 5,000 2.0625 10,562.50
10/09/98 5,000 2.00 10,252.35
10/13/98 15,000 2.0625 31,687.50
10/13/98 5,000 2.00 10,252.35
10/16/98 10,000 2.00 20,461.35
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EXHIBIT INDEX
Exhibit A Stockholder Agreement dated as of October
13, 1998 by and among the Issuer, the
Reporting Person, Steven Bogen and Anthony
Malatino.
Exhibit B Stockholders' Agreement dated as of
October 22, 1998 by and among the Reporting
Person and Anthony Malatino.
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EXHIBIT A
STOCKHOLDER AGREEMENT
This Stockholder Agreement (this "Agreement") is made and
entered into as of October 13, 1998 by and among SARATOGA BEVERAGE GROUP, INC.,
a Delaware corporation ("Saratoga"), STEVEN BOGEN ("Bogen"), ROBIN PREVER
("Prever") and ANTHONY MALATINO ("Malatino").
WHEREAS, The Fresh Juice Company, Inc., Saratoga, Rowale
Corp., a wholly-owned subsidiary of Saratoga ("Sub"), entered into, as of the
date hereof, a Restated Agreement and Plan of Merger (the "Merger Agreement";
terms used herein and not otherwise defined are used herein as defined in the
Merger Agreement), pursuant to which Sub will merge with and into Saratoga (the
"Merger"); and
WHEREAS, each of Prever and Malatino currently owns the
number of shares of Class A common stock, $.01 par value per share, of Saratoga
("Class A Common Stock") and shares of Class B common stock, $.01 par value per
share, of Saratoga ("Class B Common Stock") set forth opposite his or her name
on Schedule A annexed hereto (collectively, the "Saratoga Securities" and, with
respect to the Saratoga Securities owned by a specific Saratoga Stockholder,
the "Saratoga Stockholder's Securities"); and
WHEREAS, execution and delivery of this Agreement by the
parties hereto is desired by the parties hereto in connection with the Merger.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein, the parties hereto agree as follows:
1. Term. This Agreement shall expire on the earlier of the
date (i) after the Effective Date (as defined in the Merger Agreement) that
Bogen directly owns less than 400,000 shares of Class A Common Stock, (ii) of
the termination of the Merger Agreement by any party thereto pursuant to the
terms thereof, (iii) Bogen is convicted of a felony or a misdemeanor involving
moral turpitude, dishonesty, theft or unethical business conduct, or (iv) Bogen
breaches his fiduciary duties, in a material fashion, to Saratoga or its
stockholders.
2. Covenant of the Saratoga Stockholders. Until such time as
this Agreement is terminated in accordance with Section 1,
a. each Saratoga Stockholder, in his or her capacity
as such, agrees to vote all of his or her Saratoga Securities then
owned by such Saratoga Stockholder, to the extent that any of the
following matters are submitted to the stockholders of Saratoga, and
to take all other actions reasonably necessary (in his or her capacity
as a Saratoga Stockholder) to elect, re-elect and prevent any proposed
removal of, Bogen as a member of Saratoga's Board of Directors; and
b. Prever, in her capacity as a member of Saratoga's
Board of Directors, agrees to all take all actions reasonably
necessary to nominate, elect, re-elect and prevent any proposed
removal of, Bogen as a member of Saratoga's Board of Directors.
3. Disposition of Saratoga Securities. Subject to applicable
law, nothing contained herein shall, directly or indirectly, prohibit or limit
the offer for sale, sale, assignment, transfer, pledge, encumbrance, or other
disposition of any Saratoga Securities now owned or hereafter acquired,
beneficially or of record, by the Saratoga Stockholders or Bogen.
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4. Representations and Warranties of the Saratoga
Stockholders. Each Saratoga Stockholder represents and warrants to Bogen as
follows:
a. the Saratoga Stockholder owns such Saratoga
Securities of record or beneficially free and clear of any lien,
security interest, encumbrance or other adverse claim;
b. such Saratoga Stockholder's Securities set forth
on Schedule A hereto are the only securities of Saratoga owned of
record or beneficially by such Saratoga Stockholder or in which such
Saratoga Stockholder has any interest; and
c. such Saratoga Stockholder has the right, power
and authority to execute and deliver this Agreement and to perform his
or her obligations hereunder; such execution, delivery and performance
will not violate any applicable law, rule or regulation or any
outstanding agreement or instrument to which such Saratoga Stockholder
is a party; and this Agreement constitutes a legal, valid and binding
agreement on the part of such Saratoga Stockholder enforceable against
such Saratoga Stockholder in accordance with its terms.
5. Representations and Warranties of Saratoga. Saratoga
represents and warrants to the Company that the execution and delivery of this
Agreement by Saratoga and the performance by it of its obligations hereunder
have been duly authorized by all necessary corporate action, do not violate the
terms of its Certificate of Incorporation, its By-Laws, any law, rule or
regulation or any outstanding agreement or instrument to which it is a party or
is bound or subject to, and this Agreement constitutes a legal, valid and
binding agreement on its part.
6. Representations and Warranties of Bogen. Bogen represents
and warrants to the Saratoga Stockholders that he has the right, power and
authority to execute and deliver this Agreement and to perform his or her
obligations hereunder; such execution, delivery and performance will not
violate any applicable law, rule or regulation or any outstanding agreement or
instrument to which such Saratoga Stockholder is a party; and this Agreement
constitutes a legal, valid and binding agreement on the part of Bogen
enforceable against Bogen in accordance with its terms.
7. Saratoga Proxy.
a. Each Saratoga Stockholder hereby irrevocably
makes, constitutes and appoints Bogen to act as such Saratoga
Stockholder's true and lawful proxy and attorney-in-fact in the name
and on behalf of such Saratoga Stockholder, with full power to appoint
a substitute or substitutes, to vote all of his or her Saratoga
Securities then owned by such Saratoga Stockholder for the election of
Bogen as a director of Saratoga as set forth in Section 2 hereof. By
giving this proxy, each such Saratoga Stockholder hereby revokes any
other proxy granted by such Saratoga Stockholder to vote any of such
Saratoga Stockholder's Securities (then owned by such Saratoga
Stockholder) with respect to such matter. This proxy, and the power of
attorney and all authority contained herein, shall become effective as
to any Saratoga Stockholder only upon the failure of such Saratoga
Stockholder to vote or consent with respect to his or her shares then
owned by such Saratoga Stockholder in accordance with Section 2
hereof, following notice to such Saratoga Stockholder to that effect.
b. All power and authority hereby conferred is
coupled with an interest and is irrevocable, shall not be terminated
by any act of such Saratoga Stockholder or by operation of law, by
lack of appropriate power or authority, or by the occurrence of any
other event or events and shall be binding upon all beneficiaries,
heirs at law, legatees, distributees, successors,
10
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assigns and legal representatives of such Saratoga Stockholder;
subject to the right of such Saratoga Stockholders to sell or
otherwise dispose of his or her Saratoga Securities (as described in
Section 3). If after the execution of this Agreement any Saratoga
Stockholder shall cease to have appropriate power or authority, or if
any other such event or events shall occur (other than the sale or
other disposition of his or her Saratoga Securities by such Saratoga
Stockholder, as described in Section 3), Bogen is nevertheless
authorized and directed to vote the Saratoga Securities in accordance
with the terms of this Agreement as if such lack of appropriate power
or authority or other event or events had not occurred and regardless
of notice thereof.
8. Further Assurances. Each party hereto shall perform such
further acts and execute such further documents as may reasonably be required
to carry out the provisions of this Agreement.
9. Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any party hereto
(whether by operation of law or otherwise) without the prior written consent of
the other parties hereto.
10. Specific Performance. The parties agree that irreparable
damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with their specific terms or were otherwise
breached. It is accordingly agreed that the parties shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions hereof, this being in addition to any
other remedy to which they are entitled at law or in equity.
11. Notices. All notices or other communications required or
permitted hereunder shall be in writing and shall be deemed duly given when
delivered in person or by telecopier, cable, telex or telegram or three (3)
days after mailed by certified mail, postage prepaid.
12. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be an original, but all of which
together shall constitute one and the same agreement.
13. Governing Law; Jurisdiction. This Agreement shall be
governed by and construed in accordance with the laws of the Delaware without
giving effect to the conflicts of laws principles thereof.
14. Binding Effect: Benefits. This Agreement shall inure to
the benefit of and shall be binding upon the parties hereto and their
respective permitted assigns. Nothing in this Agreement, expressed or implied,
is intended to or shall confer on any person other than the parties hereto and
their respective permitted assigns any rights, remedies, obligations or
liabilities under or by reason of this Agreement.
11
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IN WITNESS WHEREOF, the parties have executed this Agreement
or caused this Agreement to be executed by their respective officers thereunto
duly authorized, as the case may be, as of the date first above written.
SARATOGA BEVERAGE GROUP, INC.
/s/ Robin Prever
--------------------------------------------
Name: Robin Prever
Title: President and Chief Executive Officer
/s/ Steven Bogen
--------------------------------------------
Steven Bogen
/s/ Robin Prever
--------------------------------------------
Robin Prever
/s/ Anthony Malatino
--------------------------------------------
Anthony Malatino
12
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SCHEDULE A
<TABLE>
<CAPTION>
NAME NUMBER OF SARATOGA SECURITIES
---- -----------------------------
<S> <C>
Roin Prever 20,345 shares of Class A Common Stock
167,960 shares of Class B Common Stock
Anthony Malatino 51,000 shares of Class A Common Stock
354,995 shares of Class B Common Stock
</TABLE>
13
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EXHIBIT B
---------
STOCKHOLDERS' AGREEMENT
-----------------------
This Stockholders' Agreement (this "Agreement") made as of October 22,
1998, between Robin Prever ("Prever") and Anthony Malatino ("Malatino"; Prever
and Malatino sometimes are referred to herein individually as a "Stockholder"
and collectively as the "Stockholders").
W I T N E S S E T H
WHEREAS, as of the date hereof, Prever owns 167,960 shares of Class B
common stock, par value $.01 per share ("Class B Common Stock"), of Saratoga
Beverage Group, Inc., a Delaware corporation (the "Corporation"), 20,325 shares
of Class A common stock, par value $.01 per share ("Class A Common Stock"), of
the Corporation and options to purchase 135,000 shares of Class A Common Stock;
WHEREAS, as of the date hereof, Malatino owns 354,995 shares of Class B
Common Stock and 96,000 shares of Class A Common Stock;
WHEREAS, Prever and Malatino desire to enter into this Agreement in order
to set forth certain procedures for the voting and transfer of the shares of
Class B Common Stock owned by Prever and Malatino upon death.
NOW, THEREFORE, the parties agree as follows:
1. Transfers upon Death.
(a) Purchase of Stock by the Corporation. Upon the death of a Stockholder,
the other Stockholder (the "Surviving Stockholder") shall have an option to
purchase, and the estate (the "Estate") of the deceased Stockholder (the
"Decedent") shall, if notified in writing by the Surviving Stockholder in the
manner set forth in clause (b) below, be obligated to sell to the Surviving
Stockholder, all of the shares of Class B Common Stock of the Corporation owned
by the Decedent at his or her death ("Purchase Obligation"). The Purchase Price
for each share of Class B Common Stock of the Corporation owned by the Decedent
at his or her death shall be equal to the greater of (i) the average Fair
Market Value (as hereinafter defined) of the Class A Common Stock for twenty
(20) consecutive trading days ending one (1) business day before the date of
the Notice (as hereinafter defined) and (ii) if the shares of Class A Common
Stock are publicly traded, an amount equal to eight times (8x) the published
fully diluted earnings per share of the Corporation for the four fiscal
quarters prior to the date of the Notice (such greater aggregate amount is
hereby referred to as the "Purchase Price"). For purposes of this Agreement,
"Fair Market Value" shall mean: (i) if the shares of Class A Common Stock are
publicly traded, the mean between the closing representative bid and asked
prices for the shares on such date; or (ii) if the shares of Class A Common
Stock are not publicly traded, the fair market value agreed to by the Surviving
Stockholder and the Estate acting in good faith.
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(b) Exercise of Purchase Obligation. Within ninety (90) days after the
death of a Decedent, the Surviving Stockholder shall provide the Estate with
written notice of the Surviving Stockholder's election to purchase, and the
Estate's obligation to sell, all or a portion of the shares of Class B Common
Stock of the Corporation owned by the Decedent at his or her death, at the
purchase price per share determined in accordance with Section 1(a) above (the
"Notice"). The Notice shall state that it is being given pursuant to Section 1
of this Agreement. In the event that the Surviving Stockholder dies prior to
providing the Estate with the Notice, the rights granted pursuant to this
Section 1 of the Agreement shall immediately terminate. In the event that no
Notice is given or if the Notice is given and the purchase is not consummated
for any reason, the Stockholders hereby agree that the Class B Common Stock
owned by the Decedent at his or her death shall be immediately converted into
shares of Class A Common Stock of the Corporation.
(c) Closing Date. The Notice shall fix a closing date within sixty (60)
days following the date of the Notice (the "Closing Date"). In the event that
the Surviving Stockholder dies after providing the Estate with the Notice, the
estate of the Surviving Stockholder shall not be required to consummate the
transaction described in this Section 1.
(d) Payment of Purchase Price. On the Closing Date, the Surviving
Stockholder shall pay to the Estate, by certified check, by wire transfer or by
promissory note, an amount equal to (i) the Purchase Price, multiplied by (ii)
the number of shares of Class B Common Stock of the Corporation specified in
the Notice. In exchange for the amount so paid, on the Closing Date, the Estate
shall deliver to the Surviving Stockholder the shares of Class B Common Stock
specified in the Notice. All shares of Class B Common Stock to be transferred
to the Surviving Stockholder shall be reissued as shares of Class B Common
Stock. FOR PURPOSES OF THE CHARTER OF THE CORPORATION, BOTH THE NOTICE AND THE
PURCHASE OF THE SHARES OF CLASS B COMMON STOCK BY THE SURVIVING STOCKHOLDER
SHALL BE DEEMED TO HAVE OCCURRED IMMEDIATELY PRIOR TO THE DECEDENT'S DEATH. If
the Purchase Price is paid by promissory note, such promissory note shall bear
interest at a rate equal to the then current prime rate, which interest shall
be payable quarterly in arrears. Such promissory note shall mature in two (2)
years (if the Closing Date is on or prior to the fifth anniversary of this
Agreement) or one (1) year (if the Closing Date is after the fifth anniversary
of this Agreement) and the obligations under such promissory note shall be
secured by the shares of Class B Common Stock acquired by the Surviving
Stockholder.
(e) Voting. Upon the death of the Decedent, the Estate hereby agrees that
the shares of Class B Common Stock of the Corporation owned by the Decedent at
his or her death shall be voted as set forth in Section 2 hereof.
(f) Right to Sell or Dispose of Shares Prior to Death. Except as set forth
in clause (g) hereof, nothing in this Agreement shall limit the ability of the
Stockholders to sell or otherwise dispose of their shares of Class A Common
Stock or Class B Common Stock prior to their death; provided, however, that,
except as expressly set forth in this Agreement, (i) no Stockholder may sell or
otherwise dispose of their shares of Class B Common Stock in any transaction
conditioned on the death of the Stockholder and (ii) unless a Notice is not
delivered in a timely manner, the Estate may
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not sell or otherwise dispose of its shares of Class B Common Stock within the
first one hundred fifty days (150) after the death of a Decedent.
(g) Right of First Refusal. If at any time on or after the date hereof any
Stockholder (a "Selling Stockholder") desires to sell, pledge, gift or
otherwise transfer (collectively, a "Transfer") all or any portion of the
shares of Class B Common Stock owned by the Selling Stockholder to any person
other than the other Stockholder or on the open securities markets, the Selling
Stockholder shall deliver written notice ("Offer Notice"), to the other
Stockholder (the "Offeree") stating its desire to make such Transfer, the
number of shares of Class B Common Stock proposed to be transferred (the
"Offered Shares") and the terms of the Transfer, including a statement of the
aggregate consideration (the "Offered Price"). If the Class B Common Stock
is sold on the open securities markets, the Offered Price shall be equal to
the bid price. The Offeree shall have the irrevocable and exclusive right of
first refusal (the "Right of First Refusal") to purchase all or a portion of
such Offered Shares at a purchase price in cash equal to the Offered Price;
provided, however, that, in the event of a gift by a Selling Stockholder, the
Right of First Refusal shall be at a purchase price in cash equal to the
average Fair Market Value of the Class A Common Stock for twenty (20)
consecutive trading days ending one (1) business day before the date of
the Offer Notice. In order to exercise the Right of First Refusal to purchase
the Offered Shares, the Offeree shall deliver a written notice (the
"Acceptance Notice") to the Selling Stockholder within one (1) business day
after delivery by the Selling Stockholder of an Offer Notice. An Acceptance
Notice shall state that the Offeree elects to purchase the Offered Shares and
shall fix a date for the closing of such purchase (the "Closing Date"), which
date shall be not more than five (5) business days after the date on which the
Offer Notice was delivered. Notwithstanding the provisions of the charter of
the Corporation, the parties hereby agree that all shares of Class B Common
Stock to be Transferred from a Selling Stockholder to a party other than the
Offeree shall be reissued as shares of Class A Common Stock.
2. Voting Provisions.
(a) Term. This Section 2 is effective immediately and shall continue until
the death of both Stockholders or until one of the Stockholders (or his or her
Estate) no longer owns any shares of Class B Common Stock.
(b) Grant of Proxy.
(i) Upon the death of a Decedent, the Decedent hereby irrevocably
makes, constitutes and appoints the Surviving Stockholder to act as the
Decedent's true and lawful proxy and attorney-in-fact in the name and on
behalf of the Decedent, with full power to appoint a substitute or
substitutes. The Decedent further directs the Surviving Stockholder, and
the Surviving Stockholder hereby agrees, to vote the shares of Class B
Common Stock of the Corporation in a manner determined by the Surviving
Stockholder, in his or her sole and absolute discretion, to be in the best
interests of the Corporation at any meeting of the stockholders of the
Corporation or by written consent in the place and stead of the Decedent.
By giving this proxy, the Decedent hereby revokes any other proxy granted
by the Decedent to vote any of the shares of Class B Common Stock of the
Corporation then owned by the Decedent (or the Estate).
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(ii) All power and authority hereby conferred is coupled with an
interest and is irrevocable, shall not be terminated by any act of the
Decedent (or the Estate) or by operation of law, by lack of appropriate
power or authority, or by the occurrence of any other event or events and
shall be binding upon all beneficiaries, heirs at law, legatees,
distributees, successors, assigns and legal representatives of the
Decedent. If after the execution of this Agreement, the Decedent shall
cease to have appropriate power or authority, or if any other such event
or events shall occur, the Surviving Stockholder is nevertheless
authorized and directed to vote the shares of Class B Common Stock of the
Corporation owned by the Decedent (or the Estate or its beneficiaries) in
accordance with the terms of this Agreement as if such lack of appropriate
power or authority or other event or events had not occurred and
regardless of notice thereof.
(iii) The Decedent (or the Estate or its beneficiaries, as
applicable) shall perform such further acts and execute such further
documents as may be required to vest in the Surviving Stockholder the sole
power to vote the shares of Class B Common Stock of the Corporation owned
by the Decedent (or the Estate or its beneficiaries, as applicable) during
the term of the proxy granted herein.
3. Endorsement on Stock Certificates. Upon the death of a Decedent, the
Estate shall deliver to the Corporation the certificates for all of the shares
of Class B Common Stock owned by the Decedent and the Corporation shall endorse
on the face of each such certificate a legend reading substantially as follows:
Any sale, assignment, pledge, transfer or other encumbrance or
disposition of any shares of stock represented by this certificate is
restricted by, and subject to, the terms and provisions of an
Stockholders' Agreement, dated as of October 22, 1998. A copy of the
Agreement is on file with the Secretary of the Corporation.
A copy of this Agreement shall be kept on file with the Secretary of the
Corporation.
4. Termination. In the event the Class B Common Stock of the Corporation
held by the Decedent or the Estate is purchased by the Surviving Stockholder
pursuant to the provisions of Section 1 of this Agreement, this Agreement shall
terminate upon the Closing Date, except for the payment obligations and other
terms set forth in a promissory note which shall terminate only when such
payment obligations have been satisfied. This Agreement may also be terminated
upon the written agreement of both Prever and Malatino.
5. Notices. All notices or other communications required or permitted
hereunder shall be in writing and shall be deemed duly given when delivered in
person or by telecopier, cable, telex or telegram or three (3) days after
mailed by certified mail, postage prepaid, addressed as set forth below, or to
such other address as any party hereto shall designate to the other party in
writing:
If to Prever, to: c/o Saratoga Beverage Group, Inc.
11 Geyser Road
Saratoga Springs, New York 12866
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Page 18 of 19
If to Malatino, to: c/o Morgan Stanley Dean Witter & Company
340 Broadway
Saratoga Springs, NY 12866
6. Miscellaneous.
(a) This Agreement shall be binding upon and inure to the benefit of (i)
the Stockholders and (ii) each Stockholder's heirs at law, distributees,
executors, administrators and other legal representatives in the event such
Stockholder dies.
(b) Each of the parties hereby covenants and agrees that he or it shall
hereafter execute and delivery any and all further instruments, documents and
agreements and do such other and further acts and things as may be required or
useful to carry out the intent or purpose of this Agreement and to assure to
the other parties the benefits contemplated by this Agreement.
(c) The parties recognize that irreparable damage will be suffered by the
parties if all the terms of this Agreement are not specifically enforced.
Therefore, it is agreed that this Agreement may be enforced by injunction or
specific performance; such right shall be in addition, to and not in lieu or,
any other rights or remedies.
(d) This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original, and all of which together shall constitute
one instrument.
(e) This Agreement contains the full understanding of the parties hereto
with respect to the subject matter hereof and may be amended only by a document
in writing signed by all parties hereto.
(f) Each of the parties to this Agreement has been represented from time
to time by the law firm of Swidler Berlin Shereff Friedman, LLP (the "Firm").
Given the ownership interests of the Stockholders in the Corporation, the
relationship of the Stockholders with the Corporation and the parties'
relationship with the Firm, the parties to this Agreement have concluded that
separate representation of their interests in the negotiation of the terms of
this Agreement is unnecessary, wasteful and would not further the interests of
any party to this Agreement. Each party to this Agreement acknowledges that it
has been advised of its right to retain separate counsel. Each party to this
Agreement hereby waives any conflict of interest that may be entailed in the
Firm undertaking the role described above, and consents to the Firm undertaking
such a role.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the day and year first written above.
/s/ Robin Prever
--------------------
Robin Prever
/s/ Anthony Malatino
--------------------
Anthony Malatino
