CONSTELLATION BRANDS, INC. — Board/Management Information 2008

Apr 7, 2008

8-K 1 form8k-040408.htm FORM 8K-040408 form8k-040408.htm Licensed to: Constellation Brands, inc. Document Created using EDGARizer 4.0.5.0 Copyright 1995 - 2008 EDGARfilings, Ltd., an IEC company. All rights reserved

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) April 1, 2008

| CONSTELLATION BRANDS,
INC.­ |
| --- |
| (Exact
name of registrant as specified in its
charter) |

Delaware	001-08495	16-0716709
(State
or other jurisdiction of
incorporation)	(Commission File
Number)	(IRS
Employer Identification
No.)

370 Woodcliff Drive, Suite 300, Fairport, NY 14450

(Address of Principal Executive Offices) (Zip Code)

Registrant’s telephone number, including area code (585) 218-3600

| Not
Applicable |
| --- |
| (Former
name or former address, if changed since last
report) |

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

| o | Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425) |
| --- | --- |
| o | Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12) |
| o | Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)) |
| o | Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c)) |

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e) Compensatory Arrangements of Certain Officers.

At a meeting held on April 1, 2008, the Human Resources Committee (the “Committee”) of the Board of Directors (the “Board”) of Constellation Brands, Inc. (the “Company”) took the following actions with regard to certain compensatory arrangements for certain of the Company’s senior management personnel, including its Executive Officers.

Approval of Fiscal 2009 Base Salaries

The Committee set annual base salaries, for the fiscal year ending February 28, 2009 (“FY 2009”), for the Company's Executive Officers. The following table sets forth the annual base salary levels for Fiscal 2009 of those Executive Officers identified below:

| Name
and Position | FY
2009 Base Salary |
| --- | --- |
| Richard
Sands, Chairman
of the Board | $1,114,048 |
| Robert
Sands, President
and Chief Executive Officer | $1,081,500 |
| Alexander
L. Berk, Chief
Executive Officer, Constellation
Beers and Spirits | $651,460 |
| Thomas
J. Mullin, Executive
Vice President and General
Counsel | $476,451 |
| Robert
Ryder, Executive
Vice President and Chief
Financial Officer | $530,400 |

FY 2008 Incentive Awards

The Committee determined the amount to be paid as annual incentive awards under the Company’s Annual Management Incentive Plan (the “AMIP”) in accordance with its 2008 Fiscal Year Award Program for Executive Officers (the “2008 Program”). With respect to the Company’s Executive Officers, the amounts of awards were calculated in accordance with the terms of the 2008 Program based on a percentage of base salary, depending upon the participant’s management position, and achieved Company performance or achieved Company and division performance during the plan year. Mr. Ryder became an employee of the Company during the 2008 Fiscal Year and his employment arrangement provided that for purposes of his annual incentive award, “Base Salary” would be his salary on an annualized basis. With respect to the other Executive Officers, “base salary” is base salary earned during the fiscal year. Two individuals who became Executive Officers during the 2008 Fiscal Year also received incentive awards under the AMIP, and these incentive awards were determined in a manner consistent with the awards determined under the 2008 Program based on a percentage of base salary, depending upon the participant’s management position, and a combination of achieved Company performance and division performance for the plan year.

Performance targets for each of the Executive Officers were based upon:

(1) "Earnings Before Interest and Taxes" performance by the Company or applicable division was measured for the period from March 1, 2007 through February 29, 2008.

(2) “Free Cash Flow,” which equals Net Cash Provided by (Used in) Operating Activities minus Purchases of Property, Plant and Equipment. “Free Cash Flow” was measured based on the Company’s or the applicable division’s performance for the period from March 1, 2007 through February 29, 2008.

The following table sets forth the cash payments to those Executive Officers identified below with respect to their annual incentive awards under the AMIP for the fiscal year ended February 29, 2008:

Name	Award
Richard
Sands	$923,025
Robert
Sands	$835,663
Alexander
L. Berk	$211,629
Thomas
J. Mullin	$230,274
Robert
Ryder	$254,184

FY 2008 Cash Bonus Awards

The Committee awarded discretionary cash bonuses to the Company's current Executive Officers in recognition of certain achievements and events that were not otherwise reflected in the AMIP awards. Each current Executive Officer was awarded a bonus amount equal to 36% of salary, other than Richard Sands and Robert Sands who each were awarded a bonus amount equal to 62% of salary, Alexander Berk who was awarded a bonus amount equal to 57% of salary and two other Executive Officers who were respectively awarded a bonus amount equal to 9% of salary. The following table sets forth the cash bonus awards of those Executive Officers identified below:

Name	Award
Richard
Sands	$669,798
Robert
Sands	$606,403
Alexander
L. Berk	$360,516
Thomas
J. Mullin	$166,330
Robert
Ryder	$183,600

Stock Option Awards

The Committee granted options to purchase shares of the Company's Class 1 Common Stock under the Amended and Restated Long-Term Stock Incentive Plan (the “Stock Plan”) to certain of the Company's management personnel, including its Executive Officers. The following table sets forth information regarding grants to those Executive Officers identified below:

| Name | Number
of Stock Options (1) | Exercise
Price Per Share (2) |
| --- | --- | --- |
| Richard
Sands | 437,000 | $
19.12 |
| Robert
Sands | 424,300 | $
19.12 |
| Alexander
L. Berk | 178,900 | $
19.12 |
| Thomas
J. Mullin | 130,900 | $
19.12 |
| Robert
Ryder | 145,700 | $
19.12 |

(1) Each of the options granted has a 10-year term, subject to earlier termination upon the occurrence of certain events related to termination of employment. One-fourth of the options become exercisable on each of the following anniversary dates: April 1, 2009, April 1, 2010, April 1, 2011 and April 1, 2012 provided that the option holder remains employed on that date. Under the terms of the Stock Plan, options become fully exercisable immediately in the event of a change in control.

(2) The exercise price is equal to the closing price of the Class A Common Stock on the New York Stock Exchange on April 1, 2008.

Restricted Stock Awards

The Committee awarded shares of the Company's Class A Common Stock under the Stock Plan to certain of the Company's management personnel, including its Executive Officers, subject to the applicable provisions in the Restricted Stock Award Agreement, the form of which is attached hereto as Exhibit 99.1 and incorporated herein by reference. On April 1, 2008, which was the date of the restricted stock award, the closing price of the Company’s Class A Common Stock was $19.12 per share. The following table sets forth information regarding awards to those Executive Officers identified below:

| Name | Number
of Shares (1) |
| --- | --- |
| Richard
Sands | 58,300 |
| Robert
Sands | 56,600 |
| Alexander
L. Berk | 20,500 |
| Thomas
J. Mullin | 15,000 |
| Robert
Ryder | 16,700 |

(1) Each of the awards is subject to earlier termination upon the occurrence of certain events related to termination of employment. One-fourth of the awarded shares vest on each of the following dates: May 1, 2009, May 1, 2010, May 1, 2011 and May 1, 2012 provided that the recipient of the award remains employed on that date. The awards can vest at an earlier date upon the death or Disability (as that term is defined in the Stock Plan) of the recipient of the award. Under the terms of the Stock Plan, awards become fully vested in the event of a change in control.

Item 9.01. Financial Statements and Exhibits.

| (a) | Financial
statements of businesses acquired. |
| --- | --- |
| | Not
applicable. |
| (b) | Pro
forma financial information. |
| | Not
applicable. |
| (c) | Shell
company transactions. |
| | Not
applicable. |
| (d) | Exhibits. |
| | The
following exhibit is filed as part of this Current Report on Form
8-K: |

| Exhibit
No. | Description |
| --- | --- |
| 99.1 | Form
of Employee Restricted Stock Award Agreement with respect to the Company’s
Amended and Restated Long-Term Stock Incentive
Plan. |

SIGNATURES

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: April
7, 2008 |
| --- |
| By: /s/ Robert
Ryder |
| Robert
Ryder |
| Executive
Vice President and Chief
Financial Officer |

INDEX TO EXHIBITS

Exhibit No. Description

| (1) | UNDERWRITING
AGREEMENT |
| --- | --- |
| | Not
Applicable. |
| (2) | PLAN
OF ACQUISITION, REORGANIZATION, ARRANGEMENT, LIQUIDATION OR
SUCCESSION |
| | Not
Applicable. |
| (3) | ARTICLES
OF INCORPORATION AND BYLAWS |
| | Not
Applicable. |
| (4) | INSTRUMENTS
DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING
INDENTURES |
| | Not
Applicable. |
| (7) | CORRESPONDENCE
FROM AN INDEPENDENT ACCOUNTANT REGARDING NON-RELIANCE ON A PREVIOUSLY
ISSUED AUDIT REPORT OR COMPLETED INTERIM REVIEW |
| | Not
Applicable. |
| (14) | CODE
OF ETHICS |
| | Not
Applicable. |
| (16) | LETTER
RE CHANGE IN CERTIFYING ACCOUNTANT |
| | Not
Applicable. |
| (17) | CORRESPONDENCE
ON DEPARTURE OF DIRECTOR |
| | Not
Applicable. |
| (20) | OTHER
DOCUMENTS OR STATEMENTS TO SECURITY HOLDERS |
| | Not
Applicable. |
| (23) | CONSENTS
OF EXPERTS AND COUNSEL |
| | Not
Applicable. |
| (24) | POWER
OF ATTORNEY |
| | Not
Applicable. |
| (99) | ADDITIONAL
EXHIBITS |
| (99.1) | Form
of Employee Restricted Stock Award Agreement with respect to the Company’s
Amended and Restated Long-Term Stock Incentive Plan. |
| (100) | XBRL-RELATED
DOCUMENTS |
| | Not
Applicable. |