SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment
No. 5
to
Schedule TO
Tender Offer
Statement under Section 14(d)(1) or 13(e)(1)
of the Securities Exchange Act of 1934
Diedrich Coffee, Inc.
(Name of Subject Company
(Issuer))
Marty Acquisition Sub, Inc. (Offeror)
Peets Coffee & Tea, Inc. (Parent of Offeror)
(Names of
Filing Persons (Identifying Status as Offeror, Issuer or Other Person)
COMMON STOCK, PAR VALUE $0.01 PER SHARE
(Title of Class of Securities)
253675201
(CUSIP Number of Class of Securities)
Thomas P. Cawley
Chief Financial Officer
Peets Coffee & Tea, Inc.
1400 Park Avenue
Emeryville, California 94608-3520
Tel: (510) 594-2100
(Name, address, and telephone number of person authorized to
receive
notices and communications on behalf of filing persons)
with copies to:
Kenneth L. Guernsey
David A. Lipkin
Gian-Michele a Marca
Cooley Godward Kronish LLP
101
California Street, 5
th
Floor
San Francisco, California 94111-5800
Tel: (415) 693-2000
Fax: (415) 693-2222
CALCULATION OF FILING FEE
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Transaction valuation(1)
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Amount of filing fee(2)
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$164,502,698.25
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$9,179.25
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(1)
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Estimated solely for the purpose of calculating the registration fee in accordance with the Securities Exchange Act of 1934, as amended, based on the product of
(i) $26.125, the average of the high and low per share prices of Diedrich Coffee, Inc. common stock, par value of $0.01 per share, as reported on the Nasdaq Capital Market on November 16, 2009, and (ii) 6,296,754, the estimated
maximum number of shares of Diedrich Coffee, Inc. common stock to be received by Peets Coffee & Tea, Inc. pursuant to the exchange offer and subsequent Merger.
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(2)
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The amount of the filing fee calculated in accordance with the Securities Exchange Act of 1934, as amended, equals $55.80 for each $1,000,000 of value. The filing fee
was calculated in accordance with Rule 0-11 under the Securities Exchange Act of 1934 and Fee Rate Advisory #3 for fiscal year 2010, issued October 30, 2009.
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x
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Check the box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the
previous filing by registration statement number or the form or schedule and the date of its filing.
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Amount Previously Paid: $9,179.25
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Filing Party: Peets Coffee & Tea, Inc.
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Form or Registration No.: Schedule TO-T
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Date Filed: November 17, 2009
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¨
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Check the box if the filing relates to preliminary communications made before the commencement of a tender offer.
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Check the appropriate boxes below to designate any transactions to which the statement relates:
x
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third-party tender offer subject to Rule 14d-1.
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¨
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issuer tender offer subject to Rule 13e-4.
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¨
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going-private transaction subject to Rule 13e-3.
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¨
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amendment to Schedule 13D under Rule 13d-2.
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Check the following box if the filing is a final amendment reporting the results of the tender offer:
¨
2
This Amendment No. 5 to Schedule TO (
Amendment No. 5
) amends
and supplements the Tender Offer Statement on Schedule TO, as amended (the
Schedule TO
), originally filed on November 17, 2009, relating to the offer by Marty Acquisition Sub, Inc., a Delaware corporation (the
Purchaser
) and a wholly-owned subsidiary of Peets Coffee & Tea, Inc., a Washington corporation (
Peets
), to purchase each outstanding share of common stock, par value $0.01 per share, of
Diedrich Coffee, Inc., a Delaware corporation (
Diedrich
), for consideration consisting of $17.33 in cash, without interest, and a fraction of a share of Peets common stock, no par value, having a value equal to $8.67 based
on a formula as provided in the Merger Agreement (as defined below), provided that in no event will such fraction exceed 0.315 of a share of Peets common stock, upon the terms and subject to the conditions set forth in the Prospectus/Offer to
Purchase, dated November 17, 2009 (the
Prospectus/Offer to Purchase
), and in the related Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the
Offer
). All capitalized terms used and not otherwise defined herein shall have the meanings given to such terms in the Prospectus/Offer to Purchase.
The Offer was made pursuant to an Agreement and Plan of Merger, dated as of November 2, 2009 (the
Original Merger Agreement
), as amended by Amendment No. 1 thereto dated as of
November 17, 2009, by and among Peets, the Purchaser and Diedrich (the Original Merger Agreement, as amended by such amendment, the
Merger Agreement
), which contemplates the Offer and the subsequent merger of the
Purchaser with and into Diedrich (the
Merger
) with Diedrich surviving as a wholly-owned subsidiary of Peets. Peets has filed a registration statement with the Securities and Exchange Commission on Form S-4
relating to the shares of Peets common stock to be issued to stockholders, and holders of options and warrants to purchase shares of common stock, of Diedrich in the Offer and the Merger (the
Registration Statement
). The
terms and conditions of the Offer and the Merger are described in the Prospectus/Offer to Purchase which is a part of the Registration Statement, and the related Letter of Transmittal, which were filed as Exhibits (a)(1) and (a)(2) to the Schedule
TO.
As previously disclosed, on December 1, 2009, Peets was notified by Diedrich that Diedrich had received a
binding offer from Green Mountain Coffee Roasters, Inc. (
GMCR
) to enter into a transaction pursuant to which GMCR would acquire all of the outstanding shares of common stock of Diedrich for $35.00 per share in cash. Diedrich also
notified Peets that Diedrichs board of directors had determined that the $35.00 per share proposal from GMCR was superior to the November 30, 2009 enhanced acquisition proposal submitted by Peets, under which Peets had
proposed to pay, for each share of Diedrich common stock tendered and accepted in its exchange offer, a combination of (a) 0.321 of a share of Peets common stock and (b) cash equal to the amount by which $32.50 exceeds the product of
0.321 multiplied by the Parent Average Stock Price (Peets stock price over a designated period prior to the completion of the exchange offer, as more fully defined in the Merger Agreement), provided that the cash amount of the
offer consideration would not be less than $21.265 nor greater than $22.870. Peets enhanced acquisition proposal expired at 5:00 p.m. Pacific Time on December 1, 2009.
Under its terms, and as publicly announced by Diedrich, the Merger Agreement (including the original terms of Peets offer to acquire
Diedrich set forth therein) would remain in effect until at least 5:00 p.m. Pacific Time on Monday, December 7, 2009, and until that time, Peets had the right to amend its offer such that Diedrichs board of directors could no longer
determine that GMCRs proposal continues to be a superior proposal. At approximately 1:40 p.m. Pacific Time on December 7, 2009, Peets issued a press release announcing that in response to Diedrichs determination that the most
recent proposal from GMCR to acquire Diedrich was superior to Peets most recent proposal, Peets would not be further enhancing its expired acquisition proposal. Peets further announced that it will leave in place the Offer, which
contemplates the acquisition of Diedrich for a combination of cash and stock valued at $26.00 per share, as more fully described in the Schedule TO (as amended by this Amendment No. 5). At approximately 5:00 p.m. Pacific Time on
December 7, 2009, Peets received a written communication from Diedrich that stated, among other things, the following: (a) that the Diedrich Board had held a meeting on December 7, 2009 and effected a Recommendation Change
pursuant to Section 5.3(g)(ii) of the Merger Agreement (which Recommendation Change would be effective at 5:00 p.m. Pacific Time on Monday, December 7, 2009); (b) that Diedrich had terminated the Merger Agreement pursuant to
Section 8.1(e) thereof in order to accept GMCRs most recent proposal and to enter into a definitive agreement with GMCR for the acquisition of Diedrich; and (c) that Diedrich intended to enter into such definitive agreement with GMCR
immediately after 5:00 p.m. Pacific Time on Monday, December 7, 2009. Diedrich also delivered to Peets a check in the amount of $8,517,000, representing the nonrefundable fee (the
Termination Fee
) payable to
Peets, pursuant to Section 8.3(c) of the Merger Agreement, in the event of any termination of the Merger Agreement by Diedrich pursuant to Section 8.1(e) thereof following expiration of the go-shop period (which expired on
November 23, 2009). On December 8, 2009, GMCR announced that it has entered into a definitive merger agreement to acquire Diedrich for $35 per share in cash pursuant to a cash tender offer, in a transaction with a total value of approximately
$290 million.
ITEMS 1 THROUGH 11
As permitted by General Instruction F to the Schedule TO, all of the information in the Prospectus/Offer to Purchase and the related Letter of Transmittal, and any prospectus supplement or other
supplement thereto related to the Offer filed with the Securities and Exchange Commission after the date of the Prospectus/Offer to Purchase, is hereby incorporated by reference in answer to Items 1 through 11 of the Schedule TO, subject to any
statements made in the preamble to this Amendment No. 5 above or in any prior amendments to the Schedule TO, and subject to the following additional statements and disclosures:
3
A. Termination of Merger Agreement
All references in the Schedule TO and in the Prospectus/Offer to Purchase (which have been incorporated by reference into the Schedule TO) to
the Merger Agreement are hereby qualified by reference to the fact that the Merger Agreement has been terminated, and thus except as provided below, none of the parties to the Merger Agreement continues to have any obligations thereunder.
Section 8.2 of the Merger Agreement provides that: (a) Sections 8.2, Section 8.3 and Section 9 of the Merger Agreement survive the termination of the Merger Agreement and remain in full force and effect; (b) the
termination of the Merger Agreement does not relieve any party from any liability for any prior material breach of any covenant or obligation contained in the Merger Agreement and does not relieve any party from any liability for any material breach
of any representation or warranty contained in the Merger Agreement; and (c) except with respect to any liability of Diedrich for any willful or intentional breach of any covenant or obligation contained in the Merger Agreement, the payment of
the Termination Fee is the exclusive remedy of Peets and the Purchaser with respect to a termination of the Merger Agreement pursuant to Section 8.1(e). In addition, certain definitions previously used in the Merger Agreement and other
provisions of the Merger Agreement continue to be relevant to the Offer to the extent provided herein; references to the Merger Agreement or provisions of the Merger Agreement below shall, unless the context otherwise require, be deemed
to be references to the previous language of the Merger Agreement, notwithstanding that the Merger Agreement has been terminated. Thus, although the Offer is no longer being made pursuant to the Merger Agreement, and is being continued by
Peets and the Purchaser notwithstanding the termination of the Merger Agreement, the prior provisions of the Merger Agreement continue to be relevant to the Offer to the extent that the continuing terms of the Offer include references to the
Merger Agreement.
B. Termination of Stockholder Agreements
All references in the Schedule TO and in the Prospectus/Offer to Purchase (which have been incorporated by reference into the Schedule TO) to
the stockholder agreements between Peets and certain offers and directors of Diedrich (
Stockholder Agreements
) are hereby qualified by reference to the fact that the Stockholder Agreements have been terminated in accordance
with their terms as a result of the termination of the Merger Agreement. Accordingly, none of the persons who were previously parties to the Stockholder Agreements continues to be bound by any of the terms thereof, including the obligation to tender
any shares of Diedrich common stock into the Offer or vote in favor of the adoption of the Merger Agreement.
C. Financing
Arrangements; Source and Amount of Funds
All references in the Schedule TO and in the Prospectus/Offer to Purchase (which
references have been incorporated into the Schedule TO) to the debt financing arrangements and commitments obtained by Peets to finance the Offer and the Merger, or to Peets ability to finance the Offer and the Merger, are hereby
qualified by reference to the fact that following the termination of the Merger Agreement, none of the financing arrangements or financing arrangements or commitments previously disclosed by Peets (including the arrangements with Wells Fargo
Bank, National Association and Wells Fargo Securities, LLC described in the Prospectus/Offer to Purchase (and incorporated by reference into the original Schedule TO, and the arrangements with Rabobank Nederland disclosed in Amendment No. 3 to
the Schedule TO) remain in effect. If Peets is unable to arrange the necessary financing for the proposed acquisition of Diedrich, the acquisition will not be completed.
D. Background of the Transaction
The information set forth in the section of the Prospectus/Offer to Purchase entitled Background of the Transaction (which information has been incorporated by reference into the Schedule TO)
is hereby supplemented with all information regarding material developments with respect to the transaction subsequent to the date of the Prospective/Offer to Purchase that have been set forth in amendments to the Schedule TO, including this
Amendment No. 5. In addition, since the board of directors of Diedrich is no longer supporting the transaction with Peets to holders of Diedrich common stock, the description of Diedrichs Reasons for the Transaction in
the section of the Prospectus/Offer to Purchase entitled Background of the Transaction is hereby deleted.
E.
Top-Up Option
All references in the Schedule TO and in the Prospectus/Offer to Purchase (which references have been
incorporated into the Schedule TO) to the top-up option granted by Diedrich to Peets and the Purchaser (the
Top-Up Option
) are hereby qualified by reference to the fact that as a result of the termination of the
Merger Agreement, there is no longer a Top-Up Option. Accordingly, following any acceptance of shares of Diedrich common stock for exchange pursuant to the Offer, Peets and the Purchaser will not have the opportunity to increase the number of
shares held by them pursuant to the Top-Up Option, for the purpose of completing a short-form merger in accordance with Section 253 of the Delaware General Corporation Law. Accordingly, unless the Purchaser were to acquire at least 90% of the
outstanding shares of Diedrich common stock in the Offer or otherwise (including as a result of purchases by the Purchaser during any subsequent offering period), a vote of Diedrichs stockholders will be required under Delaware law to complete
the Merger.
4
F. Conditions to the Offer; Expiration of the Offer
Although the Merger Agreement has been terminated, this has no effect on the conditions to the Offer, except for certain conditions that
Peets has waived as set forth below. Notwithstanding any other provision of the Offer to the contrary, the Purchaser will not be required to accept for exchange or deliver consideration for, and may delay the acceptance for exchange or the
delivery of consideration for, any tendered shares of Diedrich common stock, if the minimum condition described in the Prospectus/Offer to Purchase has not been satisfied by midnight (one minute after 11:59 pm), Eastern Time, on the
expiration date of the Offer, taking into account any extensions made, or if any of the following additional conditions shall not be satisfied or have been waived in writing by Peets:
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each of the representations and warranties of Diedrich contained in the Merger Agreement with respect to capitalization shall have been accurate in all
material respects as of the date of the Original Merger Agreement and shall be accurate in all material respects at and as of the expiration time of the Offer with the same force and effect as if made on at and as of such time (except for
representations and warranties that by their terms are made only as of a specific date or time, which need only be accurate in all material respects as of such date or time);
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each of the other representations and warranties of Diedrich contained in the Merger Agreement shall have been accurate in all respects as of the date
of the Original Merger Agreement and shall be accurate in all respects at and as of the expiration time of the Offer as if made on and as of such expiration time with the same force and effect as if made at and as of such time (except for
representations and warranties that by their terms are made only as of a specific date or time, which need only be accurate in all respects as of such date or time), provided that, for purposes of determining the accuracy of all of the foregoing
representations and warranties, all company material adverse effect (as defined below) and other qualifications based on the word material contained in such representations and warranties shall be disregarded;
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each covenant that Diedrich is required to comply with or to perform at or prior to the acceptance of shares of Diedrich common stock for exchange
pursuant to the Offer shall have been complied with or performed in all material respects, or, if not complied with or performed in all material respects, such noncompliance or failure to perform shall have been cured (provided that the question of
Diedrichs compliance with such covenants shall be taken into account only up to the time as of which the Merger Agreement was terminated);
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since the date of the Original Merger Agreement, no Company Material Adverse Effect (as defined in the Merger Agreement) shall have occurred and be
continuing;
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the waiting period applicable to the Offer under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the
HSR Act
)
shall have expired or been terminated;
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no temporary restraining order, preliminary or permanent injunction or other order preventing the acquisition of or payment for shares of Diedrich
common stock pursuant to the Offer or preventing completion of the Merger shall have been issued by any court of competent jurisdiction or other Governmental Body (as defined in the Merger Agreement) and remain in effect, and there shall not have
been any Legal Requirement (as defined in the Merger Agreement) enacted or deemed applicable to the Offer or the Merger by a Governmental Body that makes the acquisition of or payment for shares of Diedrich common stock pursuant to the Offer or the
completion of the Merger illegal;
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there shall not be pending, or threatened in writing, any Legal Proceeding (as defined in the Merger Agreement) by any Governmental Body challenging or
seeking to restrain or prohibit the acquisition of or payment for shares of Diedrich common stock pursuant to the Offer or the completion of the Merger or any of the other transactions contemplated by the Merger Agreement; and
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the Registration Statement shall have become effective.
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The conditions set forth above remain conditions to the Offer, notwithstanding the termination of the Merger Agreement, except that
Peets and the Purchaser have waived the following conditions that previously applied to the Offer:
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the condition that Peets and Diedrich shall have received a certificate executed by the Chief Executive Officer or Chief Financial Officer of
Diedrich confirming that the conditions described in the first three bulleted paragraphs above have been duly satisfied;
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the condition that no Triggering Event shall have occurred; and
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the condition that the Merger Agreement shall not have been validly terminated.
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5
As a result of the termination of the Merger Agreement, the provisions thereof that required
the Purchaser to extend the Offer on one or more occasions under the circumstances set forth in the Merger Agreement are no longer applicable, and the Purchaser is not obligated to extend the Offer beyond the original expiration date thereof or any
extended expiration date. The Purchaser may, however, in its sole discretion, extend the Offer beyond the original expiration date thereof or any extended expiration date, for such period or periods as it may determine appropriate.
All references in the Schedule TO and in the Prospectus/Offer to Purchase (which references have been incorporated into the Schedule TO) to
the conditions to the Offer and to the Purchasers obligation to extend the Offer are hereby qualified by reference to the foregoing.
G. Conditions to the Merger
Although the Merger Agreement has been
terminated, this has no effect on the conditions to the Merger, except for certain conditions that Peets has waived as set forth below. The obligation of Peets and the Purchaser to complete the Merger are subject to the following
conditions: (1) if required by applicable law in order to complete the Merger, a merger agreement contemplating the merger of the Purchaser with and into Diedrich shall have been duly adopted by the required vote of Diedrichs
stockholders; (2) no temporary restraining order, preliminary or permanent injunction or other order preventing the completion of the Merger shall have been issued by any court of competent jurisdiction and remain in effect, and there shall not
be any law enacted or deemed applicable to the Merger by a Governmental Body having authority over any of the parties that makes completion of the Merger illegal; (3) the Registration Statement and any required post-effective amendment thereto
relating to the Merger shall have become effective in accordance with the provisions of the Securities Act of 1933, as amended, and no stop order shall have been issued by the Securities and Exchange Commission (the
SEC
) and be
outstanding, and no proceeding for that purpose shall have been initiated by the SEC and be outstanding or be threatened by the SEC; and (4) shares of Diedrich common stock validly tendered (and not withdrawn) pursuant to the Offer shall have
been accepted for exchange and paid for pursuant to the Offer. All references in the Schedule TO and in the Prospectus/Offer to Purchase (which references have been incorporated into the Schedule TO) to the conditions to the completion of the Merger
are hereby qualified by reference to the foregoing.
H. Withdrawal of Board Recommendation
All references in the Schedule TO and in the Prospectus/Offer to Purchase (which have been incorporated by reference into the Schedule TO) to
the determinations and findings made by the board of directors of Diedrich with respect to the Offer and the Merger are hereby qualified by reference to the fact that the board of directors of Diedrich has withdrawn its recommendation that the
stockholders of Diedrich accept the Offer and tender their shares of Diedrich common stock pursuant to the Offer and (to the extent necessary) adopt the Merger Agreement. As required by SEC rules, Diedrich has filed or will be filing an amendment to
its solicitation/recommendation statement on Schedule 14D-9 describing the withdrawal of its recommendation in favor of the Offer and the Merger.
I. Continuing Directors
All references in the Schedule TO and in the
Prospectus/Offer to Purchase (which have been incorporated by reference into the Schedule TO) to the constituency of Diedrichs board of directors following the acceptance for exchange of shares of Diedrich common stock pursuant to the Offer
and prior to the completion of the Merger are hereby qualified by reference to the fact that as a result of the termination of the Merger Agreement, the provisions of the Merger Agreement that previously provided for continuing directors
during such period are no longer in effect. During the period between the completion of the Offer and the completion of the Merger, Peets will be entitled to appoint or designate directors to Diedrichs board of directors to the extent
that its ownership of shares of Diedrich common stock at that time permit it to do so under Diedrichs certificate of incorporation and bylaws.
J. Treatment of Diedrich Common Stock
All references in the Schedule TO
and in the Prospectus/Offer to Purchase (which have been incorporated by reference into the Schedule TO) to the treatment of Diedrich common stock in the Offer and the Merger are hereby qualified by reference to the fact that notwithstanding the
termination of the Merger Agreement: (a) upon the acceptance for exchange of Diedrich common stock pursuant to the Offer, each share of Diedrich common stock validly tendered to the Purchaser in the Offer and not withdrawn prior to the
expiration time of the Offer will be exchanged for consideration consisting of a combination of $17.33 in cash, without interest, and a fraction of a share of common stock, no par value, of Peets having a value equal to $8.67 based on the
formula set forth in the Merger Agreement, provided that in no event will such fraction exceed 0.315 of a share of Peets common stock, subject to adjustment for stock splits, stock dividends and similar events to the extent provided in the
Merger Agreement; and (b) as a result of the Merger, (1) all of the outstanding shares of Diedrich common stock that are not accepted for exchange in the Offer, other than shares owned by Peets, the Purchaser or Diedrich or any
wholly-owned subsidiary of Peets or Diedrich, or held in Diedrichs treasury, or owned by any stockholder of Diedrich who properly exercises appraisal rights under Delaware law, will be canceled and converted into the right to receive the
same amount of cash and fraction of a share of Peets common stock that was paid in the Offer (subject to adjustment for stock splits, stock dividends and events to the extent provided in the Merger Agreement).
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K. Treatment of Diedrich Stock Options
All references in the Schedule TO and in the Prospectus/Offer to Purchase (which have been incorporated by reference into the Schedule TO) to
the treatment of stock options to purchase shares of Diedrich common stock from Diedrich (
Company Options
) are hereby qualified by reference to the fact that notwithstanding the termination of the Merger Agreement, upon the
acceptance for exchange of Diedrich common stock pursuant to the Offer, each Company Option that is outstanding and unexercised immediately prior to such acceptance will automatically be cancelled and converted into the right to receive the
consideration provided therefor in the Merger Agreement (without the need for any exercise of the Company Option or other action on the part of Diedrich or any option holder).
L. Treatment of Diedrich Warrants
All references in the Schedule TO and in the Prospectus/Offer to Purchase (which have been incorporated by reference into the Schedule TO) to the treatment of warrants to acquire shares of Diedrich common
stock from Diedrich (
Company Warrants
) are hereby qualified by reference to the fact that notwithstanding the termination of the Merger Agreement, upon the acceptance for exchange of Diedrich common stock pursuant to the Offer,
each Company Warrant that is outstanding immediately prior to such acceptance will automatically be cancelled and converted into the right to receive the consideration provided therefor in the Merger Agreement (without the need for any exercise of
the Company Warrant or other action on the part of Diedrich or any warrant holder).
M. Ownership of Diedrich Stock
All references in the Schedule TO and in the Prospectus/Offer to Purchase (which have been incorporated by reference into the
Schedule TO) to Peets ownership of Diedrich common stock are hereby qualified by reference to the fact that Peets no longer owns any shares of Diedrich common stock.
N. Financial Statements
Item 10 of the Schedule TO is hereby amended and supplemented to include the following:
SUMMARY SELECTED CONSOLIDATED FINANCIAL DATA
The tables below present
summary selected consolidated financial data of Peets prepared in accordance with U.S. generally accepted accounting principles, or GAAP. The following selected financial data should be read in conjunction with Peets consolidated
financial statements and related notes, Managements Discussion and Analysis of Financial Condition and Results of Operations, and other financial information in Peets Annual Report on Form 10-K for the fiscal year ended
December 28, 2008 as filed with the SEC on March 13, 2009, which is incorporated by reference into this Schedule TO.
The summary selected consolidated statements of income for the thirty-nine weeks ended September 27, 2009 and September 28, 2008 and the summary selected consolidated balance sheet data as of September 27, 2009 and
September 28, 2008, are derived from the unaudited consolidated financial statements of Peets and the related notes thereto that are incorporated by reference into this Schedule TO. The summary selected consolidated statements of income
for the fiscal years ended December 28, 2008, December 30, 2007 and December 31, 2006, and the summary selected consolidated balance sheet data as of December 28, 2008, December 30, 2007 and December 31, 2006,
are derived from the audited financial statements of Peets and the related notes thereto that are incorporated by reference into this Schedule TO. The summary selected consolidated statements of income for the fiscal years ended
January 1, 2006 and January 2, 2005, and the summary selected consolidated balance sheet data as of January 1, 2006 and January 2, 2005 of Peets and the related notes thereto, are derived from audited financial statements
not included in, or incorporated by reference into, this Schedule TO.
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(in thousands, except per share data and ratio of earnings to fixed charges)
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Year
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September 27,
2009
(39
weeks)
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September 28,
2008
(39
weeks)
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December 28,
2008
(52 weeks)
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December 30,
2007
(52 weeks)
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December 31,
2006
(52 weeks)
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January 1,
2006
(52 weeks)
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January 2,
2005
(53 weeks)
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Statement of Income Data:
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Net revenue
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$
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219,575
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$
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205,676
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$
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284,822
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$
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249,389
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$
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210,493
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$
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175,198
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$
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145,683
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Cost of sales and related occupancy expenses
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99,812
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96,478
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133,537
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118,389
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98,928
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80,837
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67,806
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Operating expenses
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76,804
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72,934
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98,844
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85,800
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72,272
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57,879
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47,645
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General and administrative expenses
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17,782
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16,233
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22,519
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22,682
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20,634
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13,341
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11,439
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Depreciation and amortization expenses
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11,200
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9,395
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12,921
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10,912
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8,609
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7,293
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5,787
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Income from operations
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13,977
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10,636
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17,001
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11,606
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10,050
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15,848
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13,006
|
Interest income, net
|
|
|
111
|
|
|
636
|
|
|
726
|
|
|
1,446
|
|
|
2,456
|
|
|
1,769
|
|
|
922
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
|
14,088
|
|
|
11,272
|
|
|
17,727
|
|
|
13,052
|
|
|
12,506
|
|
|
17,617
|
|
|
13,928
|
Income tax provision
|
|
|
5,158
|
|
|
4,127
|
|
|
6,562
|
|
|
4,675
|
|
|
4,690
|
|
|
6,842
|
|
|
5,218
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
8,930
|
|
$
|
7,145
|
|
$
|
11,165
|
|
$
|
8,377
|
|
$
|
7,816
|
|
$
|
10,775
|
|
$
|
8,710
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.69
|
|
$
|
0.52
|
|
$
|
0.81
|
|
$
|
0.61
|
|
$
|
0.57
|
|
$
|
0.78
|
|
$
|
0.65
|
Diluted
|
|
$
|
0.67
|
|
$
|
0.51
|
|
$
|
0.80
|
|
$
|
0.59
|
|
$
|
0.55
|
|
$
|
0.74
|
|
$
|
0.62
|
Shares used in calculation of net income per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
12,977
|
|
|
13,825
|
|
|
13,723
|
|
|
13,724
|
|
|
13,733
|
|
|
13,801
|
|
|
13,308
|
Diluted
|
|
|
13,267
|
|
|
14,111
|
|
|
13,997
|
|
|
14,120
|
|
|
14,202
|
|
|
14,469
|
|
|
13,949
|
|
|
|
|
|
|
|
|
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
16,966
|
|
$
|
3,889
|
|
$
|
4,719
|
|
$
|
15,312
|
|
$
|
7,692
|
|
$
|
20,623
|
|
$
|
11,356
|
Current assets
|
|
|
73,380
|
|
|
66,865
|
|
|
61,482
|
|
|
63,249
|
|
|
59,314
|
|
|
80,115
|
|
|
32,468
|
Non current assets
|
|
|
112,810
|
|
|
114,457
|
|
|
114,870
|
|
|
114,298
|
|
|
93,691
|
|
|
68,637
|
|
|
96,476
|
Current liabilities
|
|
|
23,138
|
|
|
24,881
|
|
|
25,060
|
|
|
24,869
|
|
|
22,060
|
|
|
17,531
|
|
|
15,742
|
Long-term liabilities
|
|
|
8,214
|
|
|
7,030
|
|
|
7,385
|
|
|
5,425
|
|
|
3,506
|
|
|
4,343
|
|
|
3,020
|
Total shareholders equity
|
|
|
154,838
|
|
|
149,411
|
|
|
143,907
|
|
|
147,253
|
|
|
127,439
|
|
|
126,878
|
|
|
109,905
|
Book value per outstanding share
|
|
|
11.93
|
|
|
10.94
|
|
|
10.92
|
|
|
10.57
|
|
|
9.43
|
|
|
9.13
|
|
|
8.14
|
Ratio of earnings to fixed charges (1)
|
|
|
4.59
|
|
|
4.13
|
|
|
4.66
|
|
|
4.15
|
|
|
4.77
|
|
|
7.36
|
|
|
6.40
|
(1)
|
The ratio of earnings to fixed charges was computed by dividing earnings by fixed charges for the periods indicated. Earnings consist of income from
operations before income taxes plus fixed charges and certain other adjustments as set forth in the Instruction to Item 503(d) of Regulation S-K. Fixed charges consist of interest expense, if applicable, and one-third of rental
expense, which is estimated to be representative of the interest factor.
|
7
SUMMARY SELECTED UNAUDITED PRO FORMA
CONDENSED COMBINED FINANCIAL DATA
The following table presents summary unaudited pro forma condensed combined financial data which gives effect to the proposed offer and acquisition by Peets of Diedrich. The summary unaudited pro
forma condensed combined financial data is derived from and should be read in conjunction with the unaudited pro forma condensed combined financial information and related notes thereto included in the Prospectus/Offer to Purchase. The historical
consolidated financial statements have been adjusted in the unaudited pro forma condensed combined financial information to give effect to pro forma events that are (1) directly attributable to the offer and the merger, (2) factually
supportable, and (3) with respect to the statements of operations, expected to have a continuing impact on the combined results of Peets and Diedrich. See Unaudited Pro Forma Condensed Combined Financial Information beginning
on page 75 of the Prospectus/Offer to Purchase including the subsection thereof entitled Notes to Unaudited Pro Forma Condensed Combined Financial Information beginning on page 79 of the Prospectus/Offer to Purchase.
|
|
|
|
|
|
|
|
(in thousands, except per share data and ratio of earnings to fixed charges)
|
|
|
Unaudited Pro Forma Condensed Combined Statement of Operations Data:
|
|
|
|
Nine Months
Ended
September 28,
2009
|
|
Year
Ended
December 28,
2008
|
|
Net revenue
|
|
$
|
273,380
|
|
$
|
331,854
|
|
Cost of sales and related occupancy expenses
|
|
|
139,588
|
|
|
172,653
|
|
Operating income (loss) from continuing operations
|
|
|
11,658
|
|
|
(2,802
|
)
|
Income (loss) from continuing operations
|
|
|
5,725
|
|
|
(9,821
|
)
|
|
|
|
Net income (loss) per share from continuing operations:
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.39
|
|
$
|
(0.64
|
)
|
Diluted
|
|
$
|
0.38
|
|
$
|
(0.64
|
)
|
Shares used in calculation of net income (loss) per share from continuing operations:
|
|
|
|
|
|
|
|
Basic
|
|
|
14,687
|
|
|
15,433
|
|
Diluted
|
|
|
15,221
|
|
|
15,433
|
|
Ratio of earnings to fixed charges (1)
|
|
|
1.60
|
|
|
N/A
|
|
|
|
|
|
Unaudited Pro Forma Condensed Combined Balance Sheet Data:
|
|
|
|
|
|
As of
September 28,
2009
|
Cash and cash equivalents
|
|
$
|
8,556
|
Current assets
|
|
|
76,523
|
Non current assets
|
|
|
377,789
|
Current liabilities
|
|
|
42,075
|
Long-term liabilities
|
|
|
193,613
|
Total stockholders equity
|
|
|
218,624
|
Book value per outstanding share
|
|
|
14.88
|
(1)
|
The ratio of earnings to fixed charges was computed by dividing pro forma earnings by pro forma fixed charges for the periods indicated. Earnings consist of
pro forma income (loss) from continuing operations before income taxes plus fixed charges and certain other adjustments as set forth in the Instruction to Item 503(d) of Regulation S-K. Fixed charges consist of pro forma interest
expense and amortization of deferred financing fees and one-third of rental expense, which is estimated to be representative of the interest factor. Pro forma earnings would have been insufficient for the year ended December 28, 2008 to cover
fixed charges by approximately $2.8 million.
|
Item 12
of the Schedule TO is hereby amended and supplemented to include the following:
|
|
|
(a)(13)
|
|
Press Release issued by Peets Coffee & Tea, Inc. on December 8, 2009 (incorporated by reference from the Form 425 filed by Peets Coffee & Tea, Inc. with the
Securities and Exchange Commission on December 8, 2009)
|
8
SIGNATURES
After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete
and correct.
|
|
|
MARTY ACQUISITION SUB, INC.
|
|
|
By:
|
|
/
S
/ P
ATRICK
J.
OD
EA
|
Name:
|
|
Patrick J. ODea
|
Title:
|
|
President and Chief Executive Officer
|
|
|
|
PEETS COFFEE & TEA, INC.
|
|
|
By:
|
|
/
S
/ P
ATRICK
J.
OD
EA
|
Name:
|
|
Patrick J. ODea
|
Title:
|
|
President and Chief Executive Officer
|
Dated: December 9, 2009
INDEX TO EXHIBITS
|
|
|
Exhibit No.
|
|
Document
|
|
|
(a)(1)
|
|
Prospectus/Offer to Purchase relating to shares of Peets Common Stock to be issued in the Offer and the Merger (incorporated by reference from the Registration Statement on
Form S-4, filed by Peets Coffee & Tea, Inc. with the Securities and Exchange Commission on November 17, 2009)
|
|
|
(a)(2)
|
|
Form of Letter of Transmittal (incorporated by reference to Exhibit 99.1 from the Registration Statement on Form S-4, filed by Peets Coffee & Tea, Inc. with the
Securities and Exchange Commission on November 17, 2009)
|
|
|
(a)(3)
|
|
Form of Notice of Guaranteed Delivery (incorporated by reference to Exhibit 99.2 from the Registration Statement on Form S-4, filed by Peets Coffee & Tea, Inc. with
the Securities and Exchange Commission on November 17, 2009)
|
|
|
(a)(4)
|
|
Form of Letter from the Information Agent to Brokers, Dealers, Banks, Trust Companies and Other Nominees (incorporated by reference to Exhibit 99.3 from the Registration Statement
on Form S-4, filed by Peets Coffee & Tea, Inc. with the Securities and Exchange Commission on November 17, 2009)
|
|
|
(a)(5)
|
|
Form of Letter to Clients with respect to the Prospectus/Offer to Purchase for use by Brokers, Dealers, Banks, Trust Companies and Other Nominees (incorporated by reference to
Exhibit 99.4 from the Registration Statement on Form S-4, filed by Peets Coffee & Tea, Inc. with the Securities and Exchange Commission on November 17, 2009)
|
|
|
(a)(6)
|
|
Instructions for Certification of Taxpayer Identification Number on Substitute Form W-9 (incorporated by reference to Exhibit 99.5 from the Registration Statement on Form S-4,
filed by Peets Coffee & Tea, Inc. with the Securities and Exchange Commission on November 17, 2009)
|
|
|
(a)(7)
|
|
Press Release issued by Peets Coffee & Tea, Inc. on November 2, 2009 (incorporated by reference from the Form 425 filed by Peets Coffee & Tea, Inc. with the
Securities and Exchange Commission on November 3, 2009)
|
|
|
(a)(8)
|
|
Summary Newspaper Advertisement published in The Wall Street Journal on November 17, 2009
|
|
|
(a)(9)
|
|
Press Release issued by Peets Coffee & Tea, Inc. on November 23, 2009 (incorporated by reference from the Form 425 filed by Peets Coffee & Tea, Inc. with
the Securities and Exchange Commission on November 23, 2009)
|
|
|
(a)(10)
|
|
Press Release issued by Peets Coffee & Tea, Inc. on November 25, 2009 (incorporated by reference from the Form 425 filed by Peets Coffee & Tea, Inc.
with the Securities and Exchange Commission on November 25, 2009)
|
|
|
(a)(11)
|
|
Press Release issued by Peets Coffee & Tea, Inc. on November 30, 2009 (incorporated by reference from the Form 425 filed by Peets Coffee & Tea, Inc. with
the Securities and Exchange Commission on December 1, 2009)
|
|
|
(a)(12)
|
|
Press Release issued by Peets Coffee & Tea, Inc. on December 2, 2009 (incorporated by reference from the Form 425 filed by Peets Coffee & Tea, Inc. with the
Securities and Exchange Commission on December 2, 2009)
|
|
|
(a)(13)
|
|
Press Release issued by Peets Coffee & Tea, Inc. on December 8, 2009 (incorporated by reference from the Form 425 filed by Peets Coffee & Tea, Inc. with the
Securities and Exchange Commission on December 8, 2009)
|
|
|
(d)(1)
|
|
Agreement and Plan of Merger, dated as of November 2, 2009, by and among Peets Coffee & Tea, Inc., Marty Acquisition Sub, Inc. and Diedrich Coffee, Inc. (incorporated
by reference to Exhibit 2.1 from the Form 8-K filed by Peets Coffee & Tea, Inc. with the Securities and Exchange Commission on November 4, 2009)
|
|
|
(d)(2)
|
|
Amendment No. 1 to Agreement and Plan of Merger, dated as of November 17, 2009, by and among Peets Coffee & Tea, Inc., Marty Acquisition Sub, Inc. and Diedrich
Coffee, Inc. (incorporated by reference to Exhibit 2.2 from the Registration Statement on Form S-4, filed by Peets Coffee & Tea, Inc. with the Securities and Exchange Commission on November 17, 2009)
|
|
|
(d)(3)
|
|
Confidentiality Agreement, dated as of September 27, 2008, by and between Diedrich Coffee, Inc., Heeschen & Associates and Paul C. Heeschen, on the one hand, and
Peets Coffee & Tea, Inc. on the other
|
|
|
(g)
|
|
Not applicable
|
|
|
(h)
|
|
Not applicable
|
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