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Brown-Forman and GIV Sign Long-Term Production Agreement

Louisville, KY, September 18, 2006 — Brown-Forman Corporation announced today that it has successfully concluded negotiations with Gruppo Italiano Vini (GIV) for the production of Bolla Italian wines. The company had previously announced (on July 19, 2006) that it was in negotiations with GIV.

Under the agreement signed today by both companies, Brown-Forman has sold its main Bolla wine production facility in Pedemonte, Italy to GIV and GIV will in turn produce Bolla Italian Wines for Brown-Forman. The agreement also names GIV as Bolla’s distributor in the Italian domestic market. Brown-Forman, which has marketed Bolla Wines since 1968, will maintain worldwide ownership of the Bolla trademark and continue to sell Bolla Wines in the U.S. and other markets around the globe.

“This new arrangement will allow Brown-Forman to improve efficiency and gain flexibility in the sourcing of high quality wine for Bolla,” said Paul C. Varga, Brown-Forman’s chief executive officer.

GIV and Brown-Forman have had a long and productive relationship, as the Italian company has provided the wine for Brown-Forman’s Fontana Candida Italian Wines over the last two decades.

Brown-Forman Corporation is a diversified producer and marketer of fine quality consumer products, including Jack Daniel’s, Southern Comfort, Finlandia Vodka, Canadian Mist, Fetzer and Bolla Wines, Korbel California Champagnes, and Hartmann Luggage.

Important Note on Forward-Looking Statements:

This report contains statements, estimates, or projections that constitute “forward-looking statements” as defined under U.S. federal securities laws. Generally, the words “expect,” “believe,” “intend,” “estimate,” “will,” “anticipate,” and “project,” and similar expressions identify a forward-looking statement, which speaks only as of the date the statement is made. Except as required by law, we do not intend to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. We believe that the expectations and assumptions with respect to our forward-looking statements are reasonable. But by their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors that in some cases are out of our control. These factors could cause our actual results to differ materially from Brown-Forman’s historical experience or our present expectations or projections. Here is a non-exclusive list of such risks and uncertainties:

  • changes in general economic conditions, particularly in the United States where we earn the majority of our profits;
  • lower consumer confidence or purchasing in the wake of catastrophic events;
  • tax increases, whether at the federal or state level or in major international markets and/or tariff barriers or other restrictions affecting beverage alcohol;
  • limitations and restrictions on distribution of products and alcohol marketing, including advertising and promotion, as a result of stricter governmental policies adopted either in the United States or globally;
  • adverse developments in the class action lawsuits filed against Brown-Forman and other spirits, beer and wine manufacturers alleging that our industry conspired to promote the consumption of alcohol by those under the legal drinking age;
  • a strengthening U.S. dollar against foreign currencies, especially the British Pound, Euro, and Australian Dollar;
  • reduced bar, restaurant, hotel and travel business in wake of terrorist attacks or threats, such as occurred in September 2001 in the U.S. and in July 2005 in London;
  • lower consumer confidence or purchasing associated with rising energy prices;
  • a decline in U.S. spirits consumption as might be indicated by recent published trends suggesting a slight reduction in the growth rate of distilled spirits consumption;
  • longer-term, a change in consumer preferences, social trends or cultural trends that results in the reduced consumption of our premium spirits brands;
  • changes in distribution arrangements in major markets that limit our ability to market or sell our products;
  • increases in the price of energy or raw materials, including grapes, grain, wood, glass, and plastic;
  • excess wine inventories or a further world-wide oversupply of grapes;
  • termination of our rights to distribute and market agency brands included in our portfolio;
  • adverse developments as a result of state investigations of beverage alcohol industry trade practices of suppliers, distributors and retailers.