By Richard Thomas
Chip Tate, the co-founder of Balcones who is often depicted as the brains behind the Texas distillery, was bought out by his company’s board, according to the Waco Tribune-Herald. Although the full terms of the settlement are confidential, Balcones board chairman Greg Allen confirmed that Tate had agreed to sell his 27% stake in the company as part of an exit deal.
The buy-out follows a court victory for Tate four weeks ago, which ruled that all actions taken by the Balcones board following their August ouster of Tate were invalid under their own bylaws. Although the board could have appealed the ruling, in the short term it handed Tate the clear power to filibuster its governance of the company, since decisions could not be made if he refused to attend meetings.
The bad blood between Tate and Allen continues even after Tate’s departure. In cliched fashion, Allen says Tate was removed from his post as company president, while Tate insists he resigned.
The agreement also includes a no-compete clause that bars Tate from working in distilling until March 2016. As such things go, a year and a half is a relatively short period of time. Tate will be replaced at the helm of Balcones by current Chief Operating Officer Keith Bellinger.
The Whiskey Reviewer predicted a buy-out would be the outcome of the Balcones dispute in September.