Green Mountain Coffee completes $250 million sale to Lavazza, SEC requests documents

first_imgGreen Mountain Coffee Roasters finally acquires Diedrich Coffee …May 12, 2010 … Green Mountain Coffee Roasters, Inc has announced that it has acquired Diedrich Coffee, Inc. (NASDAQ: DDRX) for $35 per share of common … Green Mountain Coffee ranks #2 on Fortune’s global 100 fastest …Aug 19, 2010 … For the second consecutive year, Green Mountain Coffee Roasters, Inc. (NASDAQ: GMCR), of Waterbury, Vermont, has been ranked on Fortune’s … Green Mountain Coffee declares three-for-one stock split, earnings …Apr 28, 2010 … Green Mountain Coffee Roasters, Inc. (NASDAQ: GMCR) today announced that its Board of Directors has approved a three-for-one stock split to … Green Mountain Coffee Roasters sees sales soar | Vermont Business …Jan 15, 2010 … Green Mountain Coffee Roasters ‘ based in Waterbury ‘ had a fairly …Also purchased this year was Timothy’s World Coffee from Toronto for … Green Mountain Coffee Roasters announces $250 million common stock …Aug 11, 2010 … As a leader in the specialty coffee industry, Green Mountain CoffeeRoasters, Inc. is recognized for its award-winning coffees, … According to a Form 8-K report to the Securities & Exchange Commission Tuesday, Green Mountain Coffee Roasters, Inc completed a sale of 8,566,649 shares of its common stock, par value $0.10 per share, to Luigi Lavazza S.p.A., an Italian corporation, for an aggregate purchase price of $250 million. The Waterbury company employs 1,010 in Vermont and more than 2,000 system-wide. It has been in a buying spree lately on the West Coast and in Canada as its stock price has climbed and sales of Keurig-brand single cup serving systems has taken off. The company reported in the same filing that the SEC had requested certain documents, which GMCR believes is related to ” certain revenue recognition practices and the Company’s relationship with one of its fulfillment vendors.” It declined to comment further on the SEC request, other than to say it was cooperating fully. However, its stock price fell on the news 16 percent to $31.06. Its 52-week high is $37.97 and its 52-week low is $19.85. I was at $31.30 late Thursday. http://investor.gmcr.com/stockquote.cfm(link is external)The sale of the Shares to Lavazza was effected pursuant to the Common Stock Purchase Agreement, dated as of August 10, 2010, by and between the Company and Lavazza. The execution of the SPA was previously reported by the Company in its Current Report on Form 8-K filed by the Company with the Securities and Exchange Commission on August 11, 2010, and the full text of the SPA was filed as Exhibit 10.1 thereto. In connection with the closing of the sale of the Shares, the Company and Lavazza entered into a Registration Rights Agreement, dated as of September 28, 2010 (the ‘RRA’).Pursuant to the terms of the RRA, after the first anniversary of the date of the RRA or the earlier occurrence of specified triggering events, Lavazza will have a demand, Form S-3 registration right with respect to the Shares then held by Lavazza and other Common Stock or other securities convertible into or exchangeable for Common Stock acquired by Lavazza in accordance with the terms of the SPA (collectively, the ‘Registrable Securities’). In addition, after the first anniversary of the date of the RRA, Lavazza will have a piggyback registration right to have the Registrable Securities then held by Lavazza included in a Company-effected registration, other than a registration relating to employee benefit plans or resulting from other specified corporate events. Lavazza’s demand and piggyback registration rights are subject to the limitations and conditions set forth in the RRA, including, with respect to underwritten offerings, customary underwriter cutbacks. The RRA also provides that all expenses (other than underwriting commissions, transfer taxes, fees of Lavazza’s counsel and similar fees and commissions) incurred in connection with any registration that is subject to the exercise of Lavazza’s registration rights will generally be borne by the Company, and contains other customary provisions, including those relating to indemnification.Item 2.02 Results of Operations and Financial Condition.The information in Item 7.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.02.Item 3.02 Unregistered Sales of Equity Securities.To the extent required by Item 3.02 of Form 8-K, the information contained or incorporated in Item 1.01 of this Form 8-K is incorporated by reference into this Item 3.02. Exemption from registration under the Securities Act of 1933, as amended (the ‘Securities Act’), for the sale of the Shares to Lavazza was based on Section 4(2) of the Securities Act.Item 7.01 Regulation FD Disclosure.In connection with its acquisition of LJVH Holdings, Inc., or Van Houtte, a leading gourmet coffee brand in Canada in the home and office channels, and the marketing of the associated $1.35 billion debt financing, the Company hereby furnishes the following information:Intercompany adjustment correctionIn connection with the preparation of its financial results for its fourth fiscal quarter, the Company’s management discovered an immaterial accounting error relating to the margin percentage it had been using to eliminate the inter-company markup in its K-Cup inventory balance residing at its Keurig business unit. Management discovered that the gross margin percentage used to eliminate the inter-company markup resulted in a lower margin applied to the Keurig ending inventory balance effectively overstating consolidated inventory and understating cost of sales. Management determined that the accounting error arose during fiscal 2007 and analyzed the quantitative impact from that point forward to June 26, 2010.As of June 26, 2010, there is a cumulative $7.6 million overstatement of pre-tax income. Net of tax, the cumulative error resulted in a $4.4 million overstatement of net income or a $0.03 cumulative impact on earnings per share.After evaluating the quantitative and qualitative aspects of the error in accordance with applicable accounting literature, including Staff Accounting Bulletins published by the SEC, the Company, with the participation of the audit committee of the Board of Directors, has determined that the correction in the margin calculation represents a correction of an error in accordance with Accounting Standards Codification 250 Accounting Changes and Error Corrections, that the correction was not material to the fiscal years and the respective quarters ended 2007, 2008 and 2009 and that the Company anticipates that the correction will not be material to fiscal year 2010 and the respective quarters of fiscal 2010. As a result, the Company anticipates the cumulative amount of the accounting correction will be made in the quarter ended September 25, 2010.The Company does not intend to provide further updates regarding the correction of this error or the Company’s results for fiscal year 2010 until its fiscal 2010 fourth quarter earnings release and conference call. Additional details regarding the correction of this error will be provided in the Company’s Annual Report on Form 10-K for the fiscal year ended September 25, 2010.SEC inquiryOn September 20, 2010, the staff of the SEC’s Division of Enforcement informed the Company that it was conducting an inquiry and made a request for a voluntary production of documents and information. Based on the request, the Company believes the focus of the inquiry concerns certain revenue recognition practices and the Company’s relationship with one of its fulfillment vendors. The Company, at the direction of the audit committee of the Company’s board of directors, is cooperating fully with the SEC staff’s inquiry.Note Regarding Forward-Looking StatementsCertain statements contained herein are not based on historical fact and are ‘forward-looking statements’ within the meaning of the applicable securities laws and regulations. Generally, these statements can be identified by the use of words such as ‘anticipate,’ ‘believe,’ ‘could,’ ‘estimate,’ ‘expect,’ ‘feel,’ ‘forecast,’ ‘intend,’ ‘may,’ ‘plan,’ ‘potential,’ ‘project,’ ‘should,’ ‘would,’ and similar expressions intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Owing to the uncertainties inherent in forward-looking statements, actual results could differ materially from those stated here. Factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the impact on sales and profitability of consumer sentiment in this difficult economic environment, the Company’s success in efficiently expanding operations and capacity to meet growth, the Company’s success in efficiently and effectively integrating Tully’s, Timothy’s, and Diedrich’s wholesale operations and capacity into its Specialty Coffee business unit, the Company’s success in introducing and producing new product offerings, the ability of lenders to honor their commitments under the Company’s credit facility, competition and other business conditions in the coffee industry and food industry in general, fluctuations in availability and cost of high-quality green coffee, any other increases in costs including fuel, Keurig’s ability to continue to grow and build profits with its roaster partners in the At Home and Away from Home businesses, the Company’s ability to continue to protect and enhance its intellectual property, the Company experiencing product liability, product recall and higher than anticipated rates of warranty expense or sales returns associated with a product quality or safety issue, the impact of the loss of major customers for the Company or reduction in the volume of purchases by major customers, delays in the timing of adding new locations with existing customers, the Company’s level of success in continuing to attract new customers, sales mix variances, weather and special or unusual events, the impact of the inquiry initiated by the SEC and any related or additional governmental investigative or enforcement proceedings, as well as other risks described more fully in the Company’s filings with the SEC. Forward-looking statements reflect management’s analysis as of the date of this Current Report on Form 8-K. The Company does not undertake to revise these statements to reflect subsequent developments, other than in its regular, quarterly earnings releases. Source: GMCR. September 28, 2010Green Mountain Coffee Roasters to acquire Van Houtte for $900 …Sep 14, 2010 … Green Mountain Coffee Roasters, Inc (NASDAQ: GMCR) announced today that it has executed a Share Purchase Agreement pursuant to which GMCR … For more stories on Green Mountain Coffee Roasters, go towww.vermontbiz.comlast_img

Leave a Reply

Your email address will not be published. Required fields are marked *