This is a Press Release that will be going out on Business Wire first thing in the AM, I am putting it here and on my web site now for a reason....Don't say I don't give you the information!
ARALDICA WINERIES, LTD. announced today that it recently filed a lawsuit in New York State Supreme Court, in Goshen, Orange County, New York, against Jon L. Swan, the owner of Danielle Cheese Distributors, Inc. of Goshen, New York, seeking to enforce Swan's specific performance of an executed contract dated 15 January 1998, whereby Araldica purchased 100%- of the capital stock of Danielle from Swan.
The 20 year old Danielle company, purchased by Swan in 1994, was contracted to be sold to Araldica for $1,800,000 in cash, notes and stock by Swan, of Ambridge, Pennsylvania.
In its prior press releases of (i) 16 January 1998, announcing the Danielle acquisition, and (ii) 10 March 1998, announcing the company's unaudited, consolidated financial statements for the year ending 31 January 1998, the Company had appropriately assumed that the executed Danielle contract would be honored.
This unexpected subsequent event, whereby Swan has reneged on the January contract that he signed with Araldica, may or may not cause the company to have to restate its published financials of 10 March, which included the Danielle operation. Whether or not this proves necessary will be determined by the success or failure of the company's pending specific performance litigation filed against Swan, which is anticipated to be decided by the Court before the end of May, 1998, at which time the company will advise the public of the court's decision, and any impact such decision may have on the company.
In its litigation against Swan, Araldica claims that Swan has reneged on the January contract, refusing both to accept the company's escrowed funds and to go forward as agreed, despite having executed six different agreements, contracts and contract amendments with Araldica.
Louis D. DeSantis, President of Araldica, remarked that "Araldica has every expectation that it will prevail in its attempt to obtain an immediate Court Order forcing the seller to honor the executed contract with our company. The Court has already issued, at the request of Araldica, a Temporary Restraining Order against ...the defendant, commanding that the assets of the Danielle company be protected.
"Further", DeSantis continued, "regardless of the outcome of our request for immediate specific performance relief, Araldica will be pursuing this litigation on behalf of Araldica and its shareholders, seeking compensation for damages relating exclusively to and as a result of Swan's contract default, in the millions of dollars."
In a related development, the Swan default also caused two of Araldica's financing to collapse, the proceeds from which were to fund, among other things, its recent acquisition agreement with Gold Coast Traders, Inc.", a specialty foods distributor, of Bethel, Connecticut.
The Gold Coast acquisition has, now been rescinded by the mutual agreement of the parties involved. This event will cause Araldica to have to amend its recently published financial statements; the company anticipates that such amendment will reflect Balance Sheet (Assets and Liabilities) and Income Statement (Revenues and Earnings) reductions of no more than ten percent in any category.
ARALDICA WINERIES, LTD. (OTC/BB symbol "AWLT") is a public company engaged, since 1993, in the nationwide direct marketing of premium Italian olive oils and specialty/gourmet foods, as well as the direct marketing of custom-labeled premium Italian wines on a state-by-state basis.
FOR FURTHER INFORMATION:
Louis D. DeSantis
President & Chief Executive Officer
Araldica Wineries, Ltd.
2 Hamilton Avenue, Suite 207
New Rochelle, NY 10801-3523
TEL: 914-636-0500
FAX: 914-636-0518 |
