Common use of Constellation Clause in Contracts

Constellation. Huneeus and DBR (collectively, the "PRINCIPALS") intend to enter into certain transactions among themselves and, in connection therewith and prior thereto, to propose to a special committee of the Board of Directors of Chalone (the "SPECIAL COMMITTEE") that Chalone enter into certain transactions, based on and consistent with th▇ ▇▇▇▇▇ set forth herein and other terms to be agreed upon. The Principals have agreed to establish a joint venture company (the "JOINT VENTURE" or "JV") to which Constellation will contribute $54 million in cash and certain assets and Huneeus will contribute certain assets and liabilities, and to which DBR will, upon the completion of the merger of Holdco into Chalone described below, cause Chalone to contribute substantially all of its assets and liabilities. The Principals propose to effect the proposed transactions as follows: (i) DBR will form a corporation ("HOLDCO") and contribute $10 million in cash to Holdco and contribute its Chalone shares (including any shares obtained upon conversion of the Chalone convertible debt held by DBR) (the "SHARES") to Holdco in exchange for Holdco shares, (ii) the JV will loan to Holdco an amount equal to the difference between the aggregate cash amount to be paid in exchange for the outstanding publicly held shares of Chalone (other than the shares held by DBR, Holdco and their affiliates) in the merger described in (iv) below and the $10 million in cash to be contributed by DBR to Holdco; (iii) the source of funds for the loan by the JV will be $54 million in cash contributed by Constellation; (iv) DBR will propose to the Special Committee of the Board of Directors of Chalone that Holdco enter into a merger agreement with Chalone providing for the merger of Holdco with and into Chalone (the "MERGER"), in which merger all of the outstanding publicly held shares of Chalone (other than the shares held by DBR, Holdco and their affiliates, which shares shall be cancelled) shall be converted into cash and the stockholders (other than Holdco) will receive the wine purchase rights described on Annex G (such transactions, including the Merger, collectively, the "TRANSACTIONS"). The Principals will jointly and severally guarantee the obligations of Holdco under the merger agreement between Holdco and Chalone (the "MERGER AGREEMENT"). The closing of the Transactions will occur simultaneously. The material terms of the Merger Agreement setting forth the terms and conditions of the Merger, including the cash price per share to be paid to holders of Chalone shares (other than DBR, Holdco or its affiliates) shall require the approval of each of the Principals.

Constellation. Huneeus and DBR (collectively, the "PRINCIPALSPrincipals") intend to enter into certain transactions among themselves and, in connection therewith and prior thereto, to propose to a special committee of the Board of Directors of Chalone ▇▇▇▇▇▇▇ (the "SPECIAL COMMITTEESpecial Committee") that Chalone ▇▇▇▇▇▇▇ enter into certain transactions, based on and consistent with th▇ ▇▇▇▇▇ the terms set forth herein and other terms to be agreed upon. The Principals have agreed to establish a joint venture company (the "JOINT VENTUREJoint Venture" or "JV") to which Constellation will contribute $54 million in cash and certain assets and Huneeus will contribute certain assets and liabilities, and to which DBR will, upon the completion of the merger of Holdco into Chalone described below, cause Chalone to contribute substantially all of its assets and liabilities. The Principals propose to effect the proposed transactions as follows: (i) DBR will form a corporation ("HOLDCOHoldco") and contribute $10 million in cash to Holdco and contribute its Chalone shares (including any shares obtained upon conversion of the Chalone convertible debt held by DBR) (the "SHARESShares") to Holdco in exchange for Holdco shares, (ii) the JV will loan to Holdco an amount equal to the difference between the aggregate cash amount to be paid in exchange for the outstanding publicly held shares of Chalone (other than the shares held by DBR, Holdco and their affiliates) in the merger described in (iv) below and the $10 million in cash to be contributed by DBR to Holdco; (iii) the source of funds for the loan by the JV will be $54 million in cash contributed by Constellation; (iv) DBR will propose to the Special Committee of the Board of Directors of Chalone that Holdco enter into a merger agreement with Chalone providing for the merger of Holdco with and into Chalone (the "MERGERMerger"), in which merger all of the outstanding publicly held shares of Chalone (other than the shares held by DBR, Holdco and their affiliates, which shares shall be cancelled) shall be converted into cash and the stockholders (other than Holdco) will receive the wine purchase rights described on Annex G (such transactions, including the Merger, collectively, the "TRANSACTIONSTransactions"). The Principals will jointly and severally guarantee the obligations of Holdco under the merger agreement between Holdco and Chalone (the "MERGER AGREEMENTMerger Agreement"). The closing of the Transactions will occur simultaneously. The material terms of the Merger Agreement setting forth the terms and conditions of the Merger, including the cash price per share to be paid to holders of Chalone shares (other than DBR, Holdco or its affiliates) shall require the approval of each of the Principals.