-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BIdA7ftDfIqonbK8fMtPzbF6XKwmSxpKaJMS/v7qDqp6pdRQZhDZS7VZsQKGWSn2 efTpL6loUegzei+MgQTdjw== 0000909954-00-000002.txt : 20000302 0000909954-00-000002.hdr.sgml : 20000302 ACCESSION NUMBER: 0000909954-00-000002 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 7 CONFORMED PERIOD OF REPORT: 20000115 FILED AS OF DATE: 20000229 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GREEN MOUNTAIN COFFEE INC CENTRAL INDEX KEY: 0000909954 STANDARD INDUSTRIAL CLASSIFICATION: MISCELLANEOUS FOOD PREPARATIONS & KINDRED PRODUCTS [2090] IRS NUMBER: 030339228 STATE OF INCORPORATION: DE FISCAL YEAR END: 0928 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-12340 FILM NUMBER: 557228 BUSINESS ADDRESS: STREET 1: 33 COFFEE LANE CITY: WATERBURY STATE: VT ZIP: 05676 BUSINESS PHONE: 8022445621 MAIL ADDRESS: STREET 1: 33 COFFEE LANE CITY: WATERBURY STATE: VT ZIP: 05676 10-Q 1 10-Q FORM 10-Q U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) |X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the sixteen weeks ended January 15, 2000 OR |_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the transition period from __________ to ____________ Commission file number 1-12340 GREEN MOUNTAIN COFFEE, INC. ------------------------------------------------------ (Exact name of registrant as specified in its charter) Delaware 03-0339228 - ------------------------------- ------------------------------------ (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 33 Coffee Lane, Waterbury, Vermont 05676 --------------------------------------------------- (Address of principal executive offices) (zip code) (802) 244-5621 ---------------------------------------------------- (Registrant's telephone number, including area code) --------------------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report.) Indicate by check mark whether the registrant has (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES [ X ] NO [ ] As of February 21, 2000, 3,349,141 shares of common stock of the registrant were outstanding. Part I. Financial Information Item I. Financial Statements GREEN MOUNTAIN COFFEE, INC. Consolidated Balance Sheets (Dollars in thousands) January 15, September 25, 2000 1999 ----------- ------------- (unaudited) Assets Current assets: Cash and cash equivalents........................................ $ 1,083 $ 415 Receivables, less allowances of $210 at January 15, 2000 and $190 at September 25, 1999.................................. 6,930 6,223 Inventories...................................................... 5,074 5,409 Income tax receivable............................................ - 233 Other current assets............................................. 164 264 Loans to officers................................................ 210 250 Deferred income taxes, net....................................... 290 490 ----------- ------------- Total current assets....................................... 13,751 13,284 Fixed assets, net................................................... 10,332 10,183 Other long-term assets.............................................. 236 250 Deferred income taxes, net.......................................... 148 161 ----------- ------------- Total assets........................................................ $ 8.827 $ 23,878 =========== ============= Liabilities and Stockholders' Equity Current liabilities: Current portion of long-term debt................................ $ 1,099 $ 1,127 Accounts payable................................................. 4,518 4,551 Accrued payroll.................................................. 1,131 1,005 Accrued expenses................................................. 727 357 Income tax payable............................................... 401 - Accrued losses and other costs of discontinued operations, net... 178 192 ----------- ------------- Total current liabilities................................... 8,054 7,232 ----------- ------------- Long-term debt...................................................... 1,676 1,908 ----------- ------------- Long-term line of credit............................................ 2,780 3,056 ----------- ------------- Commitments and contingencies Stockholders' equity: Common stock, $0.10 par value: authorized - 10,000,000 shares; issued- 3,616,003 shares at January 15, 2000 and 3,615,404 shares at September 25, 1999............................................ 362 362 Additional paid-in capital....................................... 13,410 13,409 Accumulated deficit.............................................. (135) (1,435) Treasury shares, at cost: 217,995 shares at January 15, 2000 and 100,609 shares at September 25, 1999, respectively............... (1,680) (654) ----------- ------------- Total stockholders' equity....................................... 11,957 11,682 ----------- ------------- Total liabilities and stockholders' equity................. $ 24,467 $ 23,878 =========== ============= The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements.
GREEN MOUNTAIN COFFEE, INC. Consolidated Statements of Operations (Dollars in thousands except per share data) Sixteen weeks ended -------------------------- January 15, January 16, 2000 1999 ----------- ----------- (unaudited) Net sales................................ $ 24,742 $ 20,068 Cost of sales............................ 14,696 12,540 ----------- ----------- Gross profit......................... 10,046 7,528 Selling and operating expenses........... 6,049 4,968 General and administrative expenses...... 1,684 1,399 ----------- ----------- Operating income..................... 2,313 1,161 Other income (expense)................... (4) 4 Interest expense......................... (141) (300) ----------- ----------- Income before income taxes........... 2,168 865 Income tax expense....................... (868) (324) ----------- ----------- Net income........................... $ 1,300 $ 541 =========== =========== Basic income per share: Weighted average shares outstanding 3,464,105 3,515,277 Net income $ 0.38 $ 0.15 Diluted income per share: Weighted average shares outstanding 3,542,668 3,533,058 Net income $ 0.37 $ 0.15 The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements.
GREEN MOUNTAIN COFFEE, INC. Consolidated Statements of Cash Flows (Dollars in thousands) Sixteen weeks ended -------------------------- January 15, January 16, 2000 1999 ----------- ---------- (unaudited) Cash flows from operating activities: Net income........................................................... $ 1,300 $ 541 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization................................... 926 925 Loss (gain) on disposal of fixed assets......................... 70 (2) Provision for doubtful accounts................................. 68 108 Deferred income taxes........................................... 213 13 Changes in assets and liabilities: Receivables............................................... (775) (346) Inventories............................................... 335 491 Other current assets...................................... 373 (145) Other long-term assets, net............................... 14 (4) Accounts payable.......................................... (33) 360 Accrued payroll........................................... 126 (122) Accrued expenses.......................................... 771 4 ----------- ----------- Net cash provided by continuing operations................ 3,388 1,823 Net cash provided by (used for) discontinued operations... (14) 256 -------------- ----------- Net cash provided by operating activities................. 3,374 2,079 Cash flows from investing activities: Expenditures for fixed assets........................................ (1,170) (715) Proceeds from disposal of discontinued operations.................... - 86 Proceeds from disposals of fixed assets.............................. 25 23 ----------- ----------- Net cash used for investing activities................... (1,145) (606) ----------- ----------- Cash flows from financing activities: Issuance of new debt................................................. 43 - Stock option exercises .............................................. 1 - Purchase of treasury shares.......................................... (1,026) (257) Repayment of long-term debt.......................................... (303) (84) Principal payments under capital lease obligation.................... - (12) Net change in revolving line of credit............................... (276) (1,250) ----------- ----------- Net cash used for financing activities.................... (1,561) (1,603) ----------- ----------- Net increase (decrease) in cash and cash equivalents.................... 668 (130) Cash and cash equivalents at beginning of period........................ 415 777 ----------- ----------- Cash and cash equivalents at end of period.............................. $ 1,083 $ 647 =========== =========== The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements.
Green Mountain Coffee, Inc. Notes to Consolidated Financial Statements 1. Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information, the instructions to Form 10-Q, and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete consolidated financial statements. In the opinion of management, all adjustments considered necessary for a fair statement of the interim financial data have been included. Results from operations for the sixteen week period ended January 15, 2000 are not necessarily indicative of the results that may be expected for the fiscal year ending September 30, 2000. For further information, refer to the consolidated financial statements and the footnotes included in the annual report on Form 10-K for Green Mountain Coffee, Inc. for the fiscal year ended September 25, 1999. Certain reclassifications of prior year balances have been made to conform to the current presentation. 2. Inventories Inventories consist of the following: January 15, September 25, 2000 1999 ------------- ------------- Raw materials and supplies....... $ 2,336,000 $ 2,809,000 Finished goods................... 2,738,000 2,600,000 ------------- ------------- $ 5,074,000 $ 5,409,000 ============= ============= 3. Earnings per share The following table illustrates the reconciliation of the numerator and denominator of basic and diluted income per share computations as required by SFAS No. 128 (dollars in thousands, except per share data): Sixteen weeks ended --------------------------- January 15, January 16, 2000 1999 ----------- ----------- Numerator - basic and diluted earnings per share : Net income $ 1,300 $ 541 =========== =========== Denominator: Basic earnings per share - weighted average shares outstanding 3,464,105 3,515,277 Effect of dilutive securities - employee stock options 78,563 17,781 ----------- ----------- Diluted earnings per share - weighted average shares outstanding 3,542,668 3,533,058 =========== =========== Basic earnings per share $ 0.38 $ 0.15 Diluted earnings per share $ 0.37 $ 0.15
For the sixteen weeks ended January 15, 2000, options to purchase 92,776 shares of common stock at exercise prices ranging from $8.50 to $10.00 per share were outstanding but were not included in the computation of diluted income per share because the options' exercise price was greater than the market price of the shares of common stock. For the sixteen weeks ended January 16, 1999, options to purchase 457,579 shares of common stock at exercise prices ranging from $5.63 to $10.00 per share were outstanding but were not included in the computation of diluted income per share because the options' exercise price was greater than the market price of the shares of common stock. 4. Segment reporting Business conducted by the Company can be segmented into two distinct areas determined by the distribution channel. The direct mail segment is comprised of all consumer-direct sales and sales to small businesses which are solicited via catalogs and the Company's online store - www.GreenMountainCoffee.com. The wholesale segment is comprised of all sales to customers who resell Green Mountain coffee either as coffee beans or brewed coffee by the cup, such as supermarkets, office coffee distributors, convenience stores, restaurants, and others. Wholesale sales are generated through the Company's direct sales force and a limited number of distributors. Both segments of the Company sell similar products, although the entire Company product range is not fully available to both segments, and direct mail customers do not have access to the same range of equipment service, delivery and merchandising support as wholesale customers. Selling and operating costs directly attributable to the direct mail segment are charged accordingly while all remaining selling, operating, general and administrative expenses (including depreciation and amortization) are charged to the wholesale segment. The Company's management does not review assets by segment. The table below discloses segment net sales and pre-tax income for the sixteen weeks ended January 15, 2000 and January 16, 1999 (in thousands): Sixteen weeks ended --------------------------- January 15, January 16, 2000 1999 ----------- ----------- Net sales Reportable segments: Wholesale $ 23,027 $ 18,741 Direct mail 1,715 1,327 ----------- ----------- Total net sales $ 24,742 $ 20,068 =========== =========== Pre-tax income Reportable segments: Wholesale $ 2,158 $ 1,129 Direct mail 155 32 ----------- ----------- Operating income 2,313 1,161 Reconciling items: Other income (expense) (4) 4 Interest expense (141) (300) ----------- ----------- Pre-tax income $ 2,168 $ 865 =========== =========== 5. Interest rate swap agreement During the first quarter of fiscal 2000, the Company received $34,000 from Fleet National Bank for the termination of its interest rate swap agreement with a $6,000,000 nominal amount. This payment was netted against interest expense for the fiscal quarter. Due to the termination of this agreement, at January 15, 2000, the Company had $5,125,000 of debt subject to variable interest rates (the lower of Fleet bank's prime rate or LIBOR rates for maturities up to one year). 6. Derivative instruments and hedging activities In June 1998, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133"). This pronouncement will require the Company to recognize derivatives on its balance sheet at fair value. Derivatives that are not hedges must be adjusted to fair value through income. If the derivative is a hedge, depending on the nature of the hedge, changes in the fair value of derivatives will either be offset against the change in fair value of the hedged assets, liabilities or firm commitments through earnings or recognized in other comprehensive income until the hedged item is recognized in earnings. The ineffective portion of a derivative's change in fair value will be immediately recognized in earnings. The Company expects that this new standard will not have a significant effect on its results of operations. SFAS 137 deferred the effective date of SFAS 133 to fiscal years beginning after June 15, 2000, which is fiscal year 2001 for the Company. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations OVERVIEW For the sixteen weeks ended January 15, 2000, Green Mountain Coffee, Inc. (the "Company" or "Green Mountain") derived approximately 93.1% of its net sales from its wholesale operation. Green Mountain's wholesale operation sells coffee to retailers and food service concerns including supermarkets, restaurants, convenience stores, specialty food stores, hotels, universities and business offices. The Company's direct mail operation accounted for approximately 6.9% of net sales during the same period. Cost of sales consists of the cost of raw materials including coffee beans, flavorings and packaging materials, a portion of the Company's rental expense, the salaries and related expenses of production and distribution personnel, depreciation on production equipment and freight and delivery expenses. Selling and operating expenses consist of expenses that directly support the sales of the Company's wholesale or direct mail channels, including media and advertising expenses, a portion of the Company's rental expense, and the salaries and related expenses of employees directly supporting sales. General and administrative expenses consist of expenses incurred for corporate support and administration, including a portion of the Company's rental expense and the salaries and related expenses of personnel not elsewhere categorized. The Company's fiscal year ends on the last Saturday in September. The Company's fiscal year normally consists of 13 four-week periods with the first, second and third "quarters" ending 16 weeks, 28 weeks and 40 weeks, respectively, after the commencement of the fiscal year. Fiscal 2000, which began on September 26, 1999 and ends on September 30, 2000, will consist of 53 weeks with the thirteenth fiscal period having 5 weeks. COFFEE PRICES, AVAILABILITY AND GENERAL RISK FACTORS Green coffee commodity prices are subject to substantial price fluctuations, generally caused by multiple factors including weather, political and economic conditions in certain coffee-producing countries and other supply-related concerns. The Company believes that the "C" price of coffee (the price per pound quoted by the Coffee, Sugar and Cocoa Exchange) will remain highly volatile in Fiscal 2000 and beyond. In addition to the "C" price, coffee of the quality sought by Green Mountain also tends to trade on a negotiated basis at a substantial premium or "differential" above the "C" price. These differentials are also subject to significant variations. In the past, the Company has generally been able to pass increases in green coffee costs to its customers. However, there can be no assurance that the Company will be successful in passing such fluctuations on to the customers without losses in sales volume or gross margin in the future. Similarly, rapid sharp decreases in the cost of green coffee could also force the Company to lower sales prices before realizing cost reductions in its green coffee inventory. Because Green Mountain roasts over 25 different types of green coffee beans to produce its more than 60 varieties of coffee, if one type of green coffee bean were to become unavailable or prohibitively expensive, management believes Green Mountain could substitute another type of coffee of equal or better quality, meeting a similar taste profile, in a blend or temporarily remove that particular coffee from its product line. However, frequent substitutions could lead to cost increases and fluctuations in gross margins. Furthermore, a worldwide supply shortage of the high-quality arabica coffees the Company purchases could have an adverse impact on the Company. The Company enters into fixed coffee purchase commitments in an attempt to secure an adequate supply of quality coffees. To further reduce its exposure to rising coffee costs, the Company, from time to time, enters into futures contracts and buys options to hedge price-to-be-established coffee purchase commitments. The Company expects to face increasing competition in all its markets, as competitors improve the quality of their coffees to make them more comparable to Green Mountain's. In addition, specialty coffee is now more widely available and a number of competitors benefit from substantially larger promotional budgets following, among other factors, the acquisition of specialty coffee companies by large, consumer goods multinationals. The Company expects that the continued high quality and wide availability of its coffee across a large array of distribution channels and the added-value of its customer service processes will enable Green Mountain to successfully compete in this environment, although there can be no assurance that it will be able to do so. Certain statements contained herein are not based on historical fact and are "forward-looking statements" within the meaning of the applicable securities laws and regulations. In addition, the Company's representatives may from time to time make oral forward-looking statements. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statements that do not directly relate to any historical or current fact. Words such as "anticipates", "believes", "expects", "estimates", "intends", "plans", "projects", "may", and similar expressions, may identify such forward-looking statements. Owing to the uncertainties inherent in forward-looking statements, actual results could differ materially from those set forth in forward-looking statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, business conditions in the coffee industry and food industry in general, fluctuations in availability and cost of green coffee, the impact of the loss of a major customer, economic conditions, prevailing interest rates, the management challenges of rapid growth, variances from budgeted sales mix and growth rate, consumer acceptance of the Company's new products, the impact of a tighter job market, Year 2000 issues, weather and special or unusual events, as well as other risk factors described in the Company's Annual Report on Form 10-K for the fiscal year ended September 25, 1999 and other factors described from time to time in the Company's filings with the Securities and Exchange Commission. Forward-looking statements reflect management's analysis as of the date of this document. The Company does not undertake to revise these statements to reflect subsequent developments. RESULTS OF OPERATIONS Sixteen weeks ended --------------------------- January 15, January 16, 2000 1999 ----------- ----------- Net sales................................. 100.0 % 100.0 % Cost of sales............................. 59.4 % 62.5 % ----------- ----------- Gross profit......................... 40.6 % 37.5 % Selling and operating expenses............ 24.4 % 24.7 % General and administrative expenses....... 6.8 % 7.0 % ----------- ----------- Operating income..................... 9.4 % 5.8 % Other income.............................. 0.0 % 0.0 % Interest expense.......................... (0.6)% (1.5)% ----------- ----------- Income before income taxes........... 8.8 % 4.3 % Income tax expense........................ (3.5)% (1.6)% ----------- ----------- Net income........................... 5.3 % 2.7 % =========== ===========
SIXTEEN WEEKS ENDED JANUARY 15, 2000 VERSUS SIXTEEN WEEKS ENDED JANUARY 16, 1999 Net sales increased by $4,674,000, or 23.3%, from $20,068,000 for the sixteen weeks ended January 16, 1999 (the "1999 period") to $24,742,000 for the sixteen weeks ended January 15, 2000 (the "2000 period"). Coffee pounds sold increased by approximately 470,000 pounds, or 17.0%, from approximately 2,772,000 pounds in the 1999 period to approximately 3,242,000 pounds in the 2000 period. The difference between the percentage increase in net sales and the percentage increase in coffee pounds sold is primarily due to the increased sales of single-cup Keurig-Brewed TM line of coffees, whose sales price per coffee pound is greater than the Company's traditional product line, and sales of non-coffee products such as the Company's new Monte Verde TM powdered hot cappuccino and frozen granita products. The increase in net sales is primarily attributable to the wholesale segment in which net sales increased by $4,286,000, or 22.9%, from $18,741,000 for the 1999 period to $23,027,000 for the 2000 period. The wholesale net sales increase resulted primarily from the growth in the office coffee service channel. Gross profit increased by $2,518,000, or 33.4%, from $7,528,000 for the 1999 period to $10,046,000 for the 2000 period. As a percentage of net sales, gross profit increased 3.1 percentage points from 37.5% for the 1999 period to 40.6% for the 2000 period. The increase in gross profit as a percentage of sales was due primarily to the lower green coffee costs and certain efficiencies and economies of scale in distribution costs. Selling and operating expenses increased by $1,081,000, or 21.8%, from $4,968,000 for the 1999 period to $6,049,000 for the 2000 period. Selling and operating expenses decreased 0.3 percentage points as a percentage of sales from 24.7% for the 1999 period to 24.4% for the 2000 period. The dollar increase in selling and operating expense was primarily due to increased sales and sales support personnel expenses, as well as increased marketing and promotional expenses. General and administrative expenses increased by $285,000, or 20.4%, from $1,399,000 for the 1999 period to $1,684,000 for the 2000 period, but decreased 0.2 percentage points as a percentage of sales from 7.0% for the 1999 period to 6.8% for the 2000 period. The dollar increase in general and administrative expenses was primarily due to higher employee education and consulting expenses. As a result of the foregoing, operating income increased by $1,152,000, or 99.2%, from $1,161,000 for the 1999 period to $2,313,000 for the 2000 period. Interest expense decreased by $159,000, or 53.0%, from $300,000 for the 1999 period to $141,000 for the 2000 period. The decrease is due to the reduction in the Company's long-term debt made possible by strong cash flows from operations since the last quarter of fiscal 1998. Depending on interest rate fluctuations and the amount of outstanding shares that the Company may repurchase over the course of fiscal 2000, interest expense may not continue to decrease year over year. Income tax expense increased $544,000, or 67.9%, from $324,000 for the 1999 period to $868,000 for the 2000 period. It is expected that the Company's effective tax rate will continue to approximate 40% throughout fiscal 2000. Net income increased by $759,000, or 140.3%, from $541,000 for the 1999 period to $1,300,000 in the 2000 period. LIQUIDITY AND CAPITAL RESOURCES Working capital decreased $355,000 to $5,697,000 at January 15, 2000 from $6,052,000 at September 25, 1999. This decrease is primarily due to higher accrued expenses, including $401,000 income tax payable, and was partially offset by higher cash and accounts receivable. During the 2000 period, Green Mountain had capital expenditures of $1,170,000, including $460,000 for equipment on loan to wholesale customers, $306,000 for production equipment and $201,000 for computer equipment. During the 1999 period, Green Mountain had capital expenditures of $715,000, including $510,000 for equipment on loan to wholesale customers, $84,000 for production equipment and $74,000 for computer equipment. Cash used to fund the capital expenditures in the 2000 period was obtained from net cash provided by operating activities. The Company currently plans to make capital expenditures in fiscal 2000 of approximately $4,500,000. Management continuously reviews capital expenditure needs and actual amounts expended may differ from these estimates. The Company maintains a $9,000,000 line of credit with Fleet Bank - NH, the availability of which is subject to the Company's accounts receivable and inventory levels. At January 15, 2000, the outstanding balance on the Fleet line of credit was $2,780,000 and the amount remaining available was $4,693,000. The facility also provides for a term debt facility, of which $2,275,000 was outstanding at January 15, 2000. The Company presently makes monthly principal payments of $75,000 under the term debt. The Fleet credit facility is subject to certain quarterly covenants, and the Company was in compliance with these covenants at January 15, 2000. In the 2000 period, the Company also used $1,026,000 of its cash flow from operations to repurchase 117,386 of its outstanding shares. As Management believes the market is still undervaluing the Company's stock, Green Mountain may repurchase additional shares in fiscal 2000. Management believes that cash flow from operating activities, existing cash, the currently available credit facility and additional borrowings will provide sufficient liquidity to pay all liabilities in the normal course of business, fund capital expenditures and service debt requirements in fiscal 2000. . DEFERRED INCOME TAXES The Company had net deferred tax assets of $557,000 at January 15, 2000. These assets are reported net of a deferred tax asset valuation allowance at that date of $2,355,000 (including $2,306,000 primarily related to a Vermont investment tax credit). Presently, the Company believes that the deferred tax assets, net of deferred tax liabilities and the valuation allowance, are realizable and represent management's best estimate, based on the weight of available evidence as prescribed in SFAS 109, of the amount of deferred tax assets which most likely will be realized. However, management will continue to evaluate the amount of the valuation allowance based on near-term operating results and longer-term projections. YEAR 2000 In anticipation of the January 1, 2000 date change, Green Mountain developed and implemented a Year 2000 plan to address possible Year 2000 disruptions. The Company had assessed its Year 2000 readiness and identified its Year 2000 risk in three broad categories: internal business software; manufacturing, facilities and embedded chip technology; and external noncompliance by customers and suppliers. During the December 31, 1999 to January 1, 2000 date change, Green Mountain monitored its operations and computer systems and experienced no apparent problems. Since January 1, 2000, the Company has also noted no significant Year 2000 problems with its customers and suppliers. Green Mountain will continue to monitor its internal operations and computer systems, and to watch for Year 2000 problems with its customers and suppliers, during the leap year date changes from February 28, 2000 through March 1, 2000. The total cost associated with required modifications to become Year 2000 compliant did not have a material effect on Green Mountain's results of operations or financial condition. The Company spent approximately $100,000 on a telephone switching and voice mail system replacement project that was accelerated because of the Year 2000 project and approximately $250,000 on a co-generation project which was partly motivated by Year 2000 concerns related to possible power supply problems. Although Green Mountain believes that its Year 2000 plan successfully eliminated potential problems associated with the Year 2000 date change, it cannot guarantee that the plans, work and funds expended corrected all Year 2000 errors or that the information systems will not generate Year 2000 errors in the future, particularly when operating with third party computer systems or data. In addition, the Company cannot reliably predict the effect future third party disruptions may have on Green Mountain, its operations or financial condition. FACTORS AFFECTING QUARTERLY PERFORMANCE Historically, the Company has experienced significant variations in sales from quarter to quarter due to the holiday season and a variety of other factors, including, but not limited to, general economic trends, the cost of green coffee, competition, marketing programs, weather and special or unusual events. Because of the seasonality of the Company's business, results for any quarter are not necessarily indicative of the results that may be achieved for the full fiscal year. Item 3. Quantitative and Qualitative Disclosures About Market Risk There have been no material changes in information relating to commodity price risks since the Company's disclosure included in Item 7A of Form 10-K as filed with the Securities and Exchange Commission on December 22, 1999. During the first quarter of fiscal 2000, the Company received $34,000 from Fleet National Bank for the termination of its interest rate swap agreement with a $6,000,000 nominal amount. This payment was netted against interest expense for the fiscal quarter. Due to the termination of this agreement, at January 15, 2000, the Company had $5,125,000 of debt subject to variable interest rates (the lower of Fleet bank's prime rate or LIBOR rates for maturities up to one year). A hypothetical 100 basis points increase in the LIBOR rate and prime rate would result in additional interest expense of $51,000 on an annualized basis. Part II. Other Information Item 6. Exhibits and Reports on Form 8-K (a) Exhibits: 3.1 Certificate of Incorporation(1) 3.2 Bylaws(1) 10.100 Stock Option Agreement, dated as of December 21, 1999, by and between Robert D. Britt and the Company 10.101 Stock Option Agreement, dated as of December 21, 1999, by and between Agnes M. Cook and the Company 10.102 Stock Option Agreement, dated as of December 21, 1999, by and between Jonathan C. Wettstein and the Company 10.103 Stock Option Agreement, dated as of December 21, 1999, by and between James K. Prevo and the Company 10.104 Stock Option Agreement, dated as of December 21, 1999, by and between Paul Comey and the Company 27 Financial Data Schedule. (b) No reports on Form 8-K were filed during the sixteen weeks ended January 15, 2000. - ---------- (1) Incorporated by reference to the corresponding exhibit number in the Registration Statement on Form SB-2 (Registration No. 33-66646) filed on July 28, 1993, and declared effective on September 21, 1993. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. GREEN MOUNTAIN COFFEE, INC. Date: 2/29/2000 By: /s/ Robert P. Stiller - ----------------- ------------------------------------------------ Robert P. Stiller, President and Chief Executive Officer Date: 2/29/2000 By: /s/ Robert D. Britt - ----------------- ----------------------------------------------- Robert D. Britt, Chief Financial Officer, Treasurer and Secretary EX-10.100 2 AMENDED AND RESTATED STOCK OPTION AGREEMENT AMENDED AND RESTATED STOCK OPTION AGREEMENT AMENDED AND RESTATED STOCK OPTION AGREEMENT, dated as of December 21, 1999 (the "Agreement"), by and between ROBERT D. BRITT, and GREEN MOUNTAIN COFFEE, INC., a Delaware corporation with its principal place of business located at 33 Coffee Lane, Waterbury, Vermont 05676 (the "Corporation"). WHEREAS, the parties hereto are parties to that Stock Option Agreement effective as of April 15, 1993, as amended on July 21, 1993 and July 26, 1996 (the "Original Agreement"), which granted options to Robert D. Britt (the "Optionee") to acquire shares of the Corporation's Common Stock, par value $.10 per share ("Common Stock") pursuant to certain terms and conditions contained therein. WHEREAS, the parties hereto desire to amend and restate the Original Agreement as more fully set forth herein such that the terms and conditions contained in this agreement shall supercede and replace the terms and conditions set forth in the Original Agreement as if this Agreement had been the Original Agreement on its effective date. NOW THEREFORE, in consideration of the mutual covenants and obligations herein contained, the Corporation and the Optionee do hereby agree as follows: 1. GRANT OF OPTION. The Corporation hereby grants to the Optionee the right, privilege, and option to purchase (the "Option") from the Corporation Forty-Seven Thousand One Hundred Forty-Eight (47,148) shares of Common Stock (the "Optioned Shares"), in the manner and subject to conditions set forth in this Agreement, at Eight Dollars and Two Cents ($8.02) per share (the "Exercise Price"). 2. TERM OF OPTION. The Option, to the extent not exercised, shall terminate on the earlier of (a) April 15, 2008, which is the fifteenth (15th) anniversary of the initial grant date of April 15, 1993 (the "Grant Date") or (b) the date on which the Optionee's employment with the Corporation is terminated for Cause. The term "Cause" as used herein shall mean and include any of the following events: fraud or dishonesty, misappropriation or embezzlement by the Optionee involving the Corporation or any subsidiary or affiliate thereof; any violation of civil or criminal law; breach of confidentiality; the willful engaging by the Optionee in conduct which has or could reasonably be expected to have a material adverse effect on the Corporation or any of its subsidiaries or affiliates; or the material breach by the Optionee of any representations, warranties, agreements or covenants made by the Optionee in this Agreement or any other agreement between the Corporation and the Optionee. 3. TIME OF EXERCISE OF OPTION. The Option may be exercised by the Optionee (or, in the event of the Optionee's death, by the Optionee's legal representative or heirs) as to the Optioned Shares on or after the Grant Date, prior to the termination date as determined in accordance with Section 2 hereof. 4. METHOD OF EXERCISE OF OPTION. The Option shall be exercised by written notice (the "Notice of Exercise") from the Optionee (or, in the event of the Optionee's death, from the Optionee's legal representative or heirs) to the Corporation designating the number of Optioned Shares to be purchased and the desired date of purchase, which shall be not less than ten (10) nor more than thirty (30) days thereafter, accompanied by cash or by check, subject to collection and payable to the order of the Corporation, in payment of the Exercise Price for the designated number of Optioned Shares. 5. DELIVERY OF SHARES. Upon receipt by the Corporation from the Optionee of a Notice of Exercise and payment in full of the Exercise Price for the designated number of Optioned Shares, the Corporation shall deliver, as soon as administratively feasible, to the Optionee a certificate for such Optioned Shares issued in the name of the Optionee (the "Issued Shares"). Any such certificate shall bear conspicuously on its face the following legend: "The shares represented by this certificate are "restricted securities" as defined in and for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the "Act") and in the absence of an effective registration statement, these shares may not be sold, transferred, pledged, or hypothecated except in compliance with Rule 144 or another exemption from registration pursuant to the Act. " 6. RIGHTS PRIOR TO EXERCISE OF OPTION. The Option may not be sold, transferred, assigned, pledged, hypothecated, or otherwise disposed of in any way except upon the Optionee's death pursuant to the Optionee's will or the laws of the State of Vermont regarding a testator's estate, a spouse's elective share or other similar provision (the recipient of any such permitted transfer shall be know as a "Permitted Transferee"). The Optionee or any Permitted Transferee shall have no rights as a shareholder with respect to any Optioned Shares until delivery, in accordance with the provisions of Section 5 of this Agreement, of such Optioned Shares as Issued Shares. Any Permitted Transferee shall be subject to the Section 7 of this Agreement as if the Permitted Transferee was the Optionee. 7. RESTRICTED SHARES. The Optionee acknowledges that (a) the Issued Shares shall be "restricted securities" as defined in and for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the "Act"), (b) in the absence of an effective registration statement, the Issued Shares may not be sold, transferred, pledged, or hypothecated except in compliance with Rule 144 or another exemption from registration pursuant to the Act and (c) the Issued Shares will be evidenced by a certificate bearing the legend set forth in Section 5 of this Agreement. 8. NO PREEMPTIVE RIGHTS. The Optionee acknowledges that the acquisition of any Optioned Shares as Issued Shares under this Agreement does not confer on the Optionee any preemptive right to purchase, subscribe to, or be first offered any shares of any class of stock of the Corporation, presently or subsequently authorized, or any notes, debentures, bonds, or other securities of the Corporation convertible into, or carrying options or warrants to purchase, shares of any class of the stock of the Corporation, presently or subsequently authorized. 9. ADJUSTMENTS. In the event of any combination or division of the shares of Common Stock of the Corporation, or the payment of any dividend on such stock in shares of such stock, or any recapitalization in which such stock is changed into a different security, appropriate adjustments shall be made to the Optioned Shares as necessary to allow the provisions of this Agreement to operate as if such event(s) had not occurred. 10. NOTICES. All exercises of options, offers, acceptances, or other notices pursuant to this Agreement shall be made in writing and delivered within the applicable time period to the party entitled to such notice under this Agreement. Any such notice shall be effective either when tendered in person to the party entitled to such notice; or on the third (3rd) day after being deposited in the United States mail in a sealed envelope, registered or certified, with postage and postal charges prepaid, addressed to the address of such party as set forth above, or at such other address as may be designated by any of the parties hereto by notice to the other parties and if to the Corporation, with a copy to H. Kenneth Merritt, Jr., Esq., Merritt & Merritt, 30 Main Street, Suite 330, P.O. Box 5839, Burlington, VT 05402. 11. MISCELLANEOUS. 11.1 ASSIGNMENT. Except as otherwise specifically provided herein, this Agreement may not be assigned by any of the parties hereto. 11.2 BINDING EFFECT. This Agreement shall be binding upon the parties hereto and their respective heirs, distributees, personal representatives, successors and assigns. 11.3 AMENDMENTS. No modifications, amendment, addition to or termination of this Agreement, nor waiver of any of its provisions, shall be valid or enforceable unless in writing and signed by all of the parties hereto. 11.4 SEVERABILITY. The invalidity or unenforceability of any provisions hereof shall in no way affect the validity or enforceability of any other provisions. 11.5 ENTIRE AGREEMENT. This Agreement contains the entire agreement between the parties hereto with respect to the subject matter contained herein and supersedes, nullifies, voids and renders of no further force or effect all prior agreements between the parties hereto with respect to the subject matter contained herein. 11.6 WAIVER. Failure to insist upon strict compliance with any of the terms, covenants, or conditions hereof shall not be deemed a waiver of such term, covenant or condition nor shall any waiver or relinquishment of any right or power hereunder at any one time or more times be deemed a waiver or relinquishment of such right or power at any other time or times. 11.7 COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of which together shall be deemed one and the same instrument. 11.8 TITLES. The titles of all Sections are for convenience only and shall not be considered in construing the provisions hereof. 11.9 GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Vermont. IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement for the purposes contained herein as of the year and day first above written. GREEN MOUNTAIN COFFEE, INC. By: /s/ Robert P. Stiller --------------------------- Robert P. Stiller, President By: /s/ Robert D. Britt --------------------------- Robert D. Britt EX-10.101 3 AMENDED AND RESTATED STOCK OPTION AGREEMENT AMENDED AND RESTATED STOCK OPTION AGREEMENT AMENDED AND RESTATED STOCK OPTION AGREEMENT, dated as of December 21, 1999 (the "Agreement"), by and between AGNES M. COOK, and GREEN MOUNTAIN COFFEE, INC., a Delaware corporation with its principal place of business located at 33 Coffee Lane, Waterbury, Vermont 05676 (the "Corporation"). WHEREAS, the parties hereto are parties to that Stock Option Agreement effective as of April 15, 1993, as amended on July 21, 1993 and July 26, 1996 (the "Original Agreement"), which granted options to Agnes M. Cook (the "Optionee") to acquire shares of the Corporation's Common Stock, par value $.10 per share ("Common Stock") pursuant to certain terms and conditions contained therein. WHEREAS, the parties hereto desire to amend and restate the Original Agreement as more fully set forth herein such that the terms and conditions contained in this agreement shall supercede and replace the terms and conditions set forth in the Original Agreement as if this Agreement had been the Original Agreement on its effective date. NOW THEREFORE, in consideration of the mutual covenants and obligations herein contained, the Corporation and the Optionee do hereby agree as follows: 1. GRANT OF OPTION. The Corporation hereby grants to the Optionee the right, privilege, and option to purchase (the "Option") from the Corporation Eleven Thousand Seven Hundred Eighty-Seven (11,787) shares of Common Stock (the "Optioned Shares"), in the manner and subject to conditions set forth in this Agreement, at Eight Dollars and Two Cents ($8.02) per share (the "Exercise Price"). 2. TERM OF OPTION. The Option, to the extent not exercised, shall terminate on the earlier of (a) April 15, 2008, which is the fifteenth (15th) anniversary of the initial grant date of April 15, 1993 (the "Grant Date") or (b) the date on which the Optionee's employment with the Corporation is terminated for Cause. The term "Cause" as used herein shall mean and include any of the following events: fraud or dishonesty, misappropriation or embezzlement by the Optionee involving the Corporation or any subsidiary or affiliate thereof; any violation of civil or criminal law; breach of confidentiality; the willful engaging by the Optionee in conduct which has or could reasonably be expected to have a material adverse effect on the Corporation or any of its subsidiaries or affiliates; or the material breach by the Optionee of any representations, warranties, agreements or covenants made by the Optionee in this Agreement or any other agreement between the Corporation and the Optionee. 3. TIME OF EXERCISE OF OPTION. The Option may be exercised by the Optionee (or, in the event of the Optionee's death, by the Optionee's legal representative or heirs) as to the Optioned Shares on or after the Grant Date, prior to the termination date as determined in accordance with Section 2 hereof. 4. METHOD OF EXERCISE OF OPTION. The Option shall be exercised by written notice (the "Notice of Exercise") from the Optionee (or, in the event of the Optionee's death, from the Optionee's legal representative or heirs) to the Corporation designating the number of Optioned Shares to be purchased and the desired date of purchase, which shall be not less than ten (10) nor more than thirty (30) days thereafter, accompanied by cash or by check, subject to collection and payable to the order of the Corporation, in payment of the Exercise Price for the designated number of Optioned Shares. 5. DELIVERY OF SHARES. Upon receipt by the Corporation from the Optionee of a Notice of Exercise and payment in full of the Exercise Price for the designated number of Optioned Shares, the Corporation shall deliver, as soon as administratively feasible, to the Optionee a certificate for such Optioned Shares issued in the name of the Optionee (the "Issued Shares"). Any such certificate shall bear conspicuously on its face the following legend: "The shares represented by this certificate are "restricted securities" as defined in and for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the "Act") and in the absence of an effective registration statement, these shares may not be sold, transferred, pledged, or hypothecated except in compliance with Rule 144 or another exemption from registration pursuant to the Act. " 6. RIGHTS PRIOR TO EXERCISE OF OPTION. The Option may not be sold, transferred, assigned, pledged, hypothecated, or otherwise disposed of in any way except upon the Optionee's death pursuant to the Optionee's will or the laws of the State of Vermont regarding a testator's estate, a spouse's elective share or other similar provision (the recipient of any such permitted transfer shall be know as a "Permitted Transferee"). The Optionee or any Permitted Transferee shall have no rights as a shareholder with respect to any Optioned Shares until delivery, in accordance with the provisions of Section 5 of this Agreement, of such Optioned Shares as Issued Shares. Any Permitted Transferee shall be subject to the Section 7 of this Agreement as if the Permitted Transferee was the Optionee. 7. RESTRICTED SHARES. The Optionee acknowledges that (a) the Issued Shares shall be "restricted securities" as defined in and for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the "Act"), (b) in the absence of an effective registration statement, the Issued Shares may not be sold, transferred, pledged, or hypothecated except in compliance with Rule 144 or another exemption from registration pursuant to the Act and (c) the Issued Shares will be evidenced by a certificate bearing the legend set forth in Section 5 of this Agreement. 8. NO PREEMPTIVE RIGHTS. The Optionee acknowledges that the acquisition of any Optioned Shares as Issued Shares under this Agreement does not confer on the Optionee any preemptive right to purchase, subscribe to, or be first offered any shares of any class of stock of the Corporation, presently or subsequently authorized, or any notes, debentures, bonds, or other securities of the Corporation convertible into, or carrying options or warrants to purchase, shares of any class of the stock of the Corporation, presently or subsequently authorized. 9. ADJUSTMENTS. In the event of any combination or division of the shares of Common Stock of the Corporation, or the payment of any dividend on such stock in shares of such stock, or any recapitalization in which such stock is changed into a different security, appropriate adjustments shall be made to the Optioned Shares as necessary to allow the provisions of this Agreement to operate as if such event(s) had not occurred. 10. NOTICES. All exercises of options, offers, acceptances, or other notices pursuant to this Agreement shall be made in writing and delivered within the applicable time period to the party entitled to such notice under this Agreement. Any such notice shall be effective either when tendered in person to the party entitled to such notice; or on the third (3rd) day after being deposited in the United States mail in a sealed envelope, registered or certified, with postage and postal charges prepaid, addressed to the address of such party as set forth above, or at such other address as may be designated by any of the parties hereto by notice to the other parties and if to the Corporation, with a copy to H. Kenneth Merritt, Jr., Esq., Merritt & Merritt, 30 Main Street, Suite 330, P.O. Box 5839, Burlington, VT 05402. 11. MISCELLANEOUS. 11.1 ASSIGNMENT. Except as otherwise specifically provided herein, this Agreement may not be assigned by any of the parties hereto. 11.2 BINDING EFFECT. This Agreement shall be binding upon the parties hereto and their respective heirs, distributees, personal representatives, successors and assigns. 11.3 AMENDMENTS. No modifications, amendment, addition to or termination of this Agreement, nor waiver of any of its provisions, shall be valid or enforceable unless in writing and signed by all of the parties hereto. 11.4 SEVERABILITY. The invalidity or unenforceability of any provisions hereof shall in no way affect the validity or enforceability of any other provisions. 11.5 ENTIRE AGREEMENT. This Agreement contains the entire agreement between the parties hereto with respect to the subject matter contained herein and supersedes, nullifies, voids and renders of no further force or effect all prior agreements between the parties hereto with respect to the subject matter contained herein. 11.6 WAIVER. Failure to insist upon strict compliance with any of the terms, covenants, or conditions hereof shall not be deemed a waiver of such term, covenant or condition nor shall any waiver or relinquishment of any right or power hereunder at any one time or more times be deemed a waiver or relinquishment of such right or power at any other time or times. 11.7 COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of which together shall be deemed one and the same instrument. 11.8 TITLES. The titles of all Sections are for convenience only and shall not be considered in construing the provisions hereof. 11.9 GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Vermont. IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement for the purposes contained herein as of the year and day first above written. GREEN MOUNTAIN COFFEE, INC. By: /s/ Robert P. Stiller --------------------------- Robert P. Stiller, President By: /s/ Agnes M. Cook ---------------------------- Agnes M. Cook EX-10.102 4 AMENDED AND RESTATED STOCK OPTION AGREEMENT AMENDED AND RESTATED STOCK OPTION AGREEMENT AMENDED AND RESTATED STOCK OPTION AGREEMENT, dated as of December 21, 1999 (the "Agreement"), by and between JONATHAN C. WETTSTEIN, and GREEN MOUNTAIN COFFEE, INC., a Delaware corporation with its principal place of business located at 33 Coffee Lane, Waterbury, Vermont 05676 (the "Corporation"). WHEREAS, the parties hereto are parties to that Stock Option Agreement effective as of April 15, 1993, as amended on July 21, 1993 and July 26, 1996 (the "Original Agreement"), which granted options to Jonathan C. Wettstein (the "Optionee") to acquire shares of the Corporation's Common Stock, par value $.10 per share ("Common Stock") pursuant to certain terms and conditions contained therein. WHEREAS, the parties hereto desire to amend and restate the Original Agreement as more fully set forth herein such that the terms and conditions contained in this agreement shall supercede and replace the terms and conditions set forth in the Original Agreement as if this Agreement had been the Original Agreement on its effective date. NOW THEREFORE, in consideration of the mutual covenants and obligations herein contained, the Corporation and the Optionee do hereby agree as follows: 1. GRANT OF OPTION. The Corporation hereby grants to the Optionee the right, privilege, and option to purchase (the "Option") from the Corporation Forty-Seven Thousand One Hundred Forty-Eight (47,148) shares of Common Stock (the "Optioned Shares"), in the manner and subject to conditions set forth in this Agreement, at Eight Dollars and Two Cents ($8.02) per share (the "Exercise Price"). 2. TERM OF OPTION. The Option, to the extent not exercised, shall terminate on the earlier of (a) April 15, 2008, which is the fifteenth (15th) anniversary of the initial grant date of April 15, 1993 (the "Grant Date") or (b) the date on which the Optionee's employment with the Corporation is terminated for Cause. The term "Cause" as used herein shall mean and include any of the following events: fraud or dishonesty, misappropriation or embezzlement by the Optionee involving the Corporation or any subsidiary or affiliate thereof; any violation of civil or criminal law; breach of confidentiality; the willful engaging by the Optionee in conduct which has or could reasonably be expected to have a material adverse effect on the Corporation or any of its subsidiaries or affiliates; or the material breach by the Optionee of any representations, warranties, agreements or covenants made by the Optionee in this Agreement or any other agreement between the Corporation and the Optionee. 3. TIME OF EXERCISE OF OPTION. The Option may be exercised by the Optionee (or, in the event of the Optionee's death, by the Optionee's legal representative or heirs) as to the Optioned Shares on or after the Grant Date, prior to the termination date as determined in accordance with Section 2 hereof. 4. METHOD OF EXERCISE OF OPTION. The Option shall be exercised by written notice (the "Notice of Exercise") from the Optionee (or, in the event of the Optionee's death, from the Optionee's legal representative or heirs) to the Corporation designating the number of Optioned Shares to be purchased and the desired date of purchase, which shall be not less than ten (10) nor more than thirty (30) days thereafter, accompanied by cash or by check, subject to collection and payable to the order of the Corporation, in payment of the Exercise Price for the designated number of Optioned Shares. 5. DELIVERY OF SHARES. Upon receipt by the Corporation from the Optionee of a Notice of Exercise and payment in full of the Exercise Price for the designated number of Optioned Shares, the Corporation shall deliver, as soon as administratively feasible, to the Optionee a certificate for such Optioned Shares issued in the name of the Optionee (the "Issued Shares"). Any such certificate shall bear conspicuously on its face the following legend: "The shares represented by this certificate are "restricted securities" as defined in and for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the "Act") and in the absence of an effective registration statement, these shares may not be sold, transferred, pledged, or hypothecated except in compliance with Rule 144 or another exemption from registration pursuant to the Act. " 6. RIGHTS PRIOR TO EXERCISE OF OPTION. The Option may not be sold, transferred, assigned, pledged, hypothecated, or otherwise disposed of in any way except upon the Optionee's death pursuant to the Optionee's will or the laws of the State of Vermont regarding a testator's estate, a spouse's elective share or other similar provision (the recipient of any such permitted transfer shall be know as a "Permitted Transferee"). The Optionee or any Permitted Transferee shall have no rights as a shareholder with respect to any Optioned Shares until delivery, in accordance with the provisions of Section 5 of this Agreement, of such Optioned Shares as Issued Shares. Any Permitted Transferee shall be subject to the Section 7 of this Agreement as if the Permitted Transferee was the Optionee. 7. RESTRICTED SHARES. The Optionee acknowledges that (a) the Issued Shares shall be "restricted securities" as defined in and for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the "Act"), (b) in the absence of an effective registration statement, the Issued Shares may not be sold, transferred, pledged, or hypothecated except in compliance with Rule 144 or another exemption from registration pursuant to the Act and (c) the Issued Shares will be evidenced by a certificate bearing the legend set forth in Section 5 of this Agreement. 8. NO PREEMPTIVE RIGHTS. The Optionee acknowledges that the acquisition of any Optioned Shares as Issued Shares under this Agreement does not confer on the Optionee any preemptive right to purchase, subscribe to, or be first offered any shares of any class of stock of the Corporation, presently or subsequently authorized, or any notes, debentures, bonds, or other securities of the Corporation convertible into, or carrying options or warrants to purchase, shares of any class of the stock of the Corporation, presently or subsequently authorized. 9. ADJUSTMENTS. In the event of any combination or division of the shares of Common Stock of the Corporation, or the payment of any dividend on such stock in shares of such stock, or any recapitalization in which such stock is changed into a different security, appropriate adjustments shall be made to the Optioned Shares as necessary to allow the provisions of this Agreement to operate as if such event(s) had not occurred. 10. NOTICES. All exercises of options, offers, acceptances, or other notices pursuant to this Agreement shall be made in writing and delivered within the applicable time period to the party entitled to such notice under this Agreement. Any such notice shall be effective either when tendered in person to the party entitled to such notice; or on the third (3rd) day after being deposited in the United States mail in a sealed envelope, registered or certified, with postage and postal charges prepaid, addressed to the address of such party as set forth above, or at such other address as may be designated by any of the parties hereto by notice to the other parties and if to the Corporation, with a copy to H. Kenneth Merritt, Jr., Esq., Merritt & Merritt, 30 Main Street, Suite 330, P.O. Box 5839, Burlington, VT 05402. 11. MISCELLANEOUS. 11.1 ASSIGNMENT. Except as otherwise specifically provided herein, this Agreement may not be assigned by any of the parties hereto. 11.2 BINDING EFFECT. This Agreement shall be binding upon the parties hereto and their respective heirs, distributees, personal representatives, successors and assigns. 11.3 AMENDMENTS. No modifications, amendment, addition to or termination of this Agreement, nor waiver of any of its provisions, shall be valid or enforceable unless in writing and signed by all of the parties hereto. 11.4 SEVERABILITY. The invalidity or unenforceability of any provisions hereof shall in no way affect the validity or enforceability of any other provisions. 11.5 ENTIRE AGREEMENT. This Agreement contains the entire agreement between the parties hereto with respect to the subject matter contained herein and supersedes, nullifies, voids and renders of no further force or effect all prior agreements between the parties hereto with respect to the subject matter contained herein. 11.6 WAIVER. Failure to insist upon strict compliance with any of the terms, covenants, or conditions hereof shall not be deemed a waiver of such term, covenant or condition nor shall any waiver or relinquishment of any right or power hereunder at any one time or more times be deemed a waiver or relinquishment of such right or power at any other time or times. 11.7 COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of which together shall be deemed one and the same instrument. 11.8 TITLES. The titles of all Sections are for convenience only and shall not be considered in construing the provisions hereof. 11.9 GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Vermont. IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement for the purposes contained herein as of the year and day first above written. GREEN MOUNTAIN COFFEE, INC. By: /s/ Robert P. Stiller ------------------------------- Robert P. Stiller, President By: /s/ Jonathan C. Wettstein -------------------------------- Jonathan C. Wettstein EX-10.103 5 AMENDED AND RESTATED STOCK OPTION AGREEMENT AMENDED AND RESTATED STOCK OPTION AGREEMENT AMENDED AND RESTATED STOCK OPTION AGREEMENT, dated as of December 21, 1999 (the "Agreement"), by and between JAMES K. PREVO, and GREEN MOUNTAIN COFFEE, INC., a Delaware corporation with its principal place of business located at 33 Coffee Lane, Waterbury, Vermont 05676 (the "Corporation"). WHEREAS, the parties hereto are parties to that Stock Option Agreement effective as of April 15, 1993, as amended on July 21, 1993 and July 26, 1996 (the "Original Agreement"), which granted options to James K. Prevo (the "Optionee") to acquire shares of the Corporation's Common Stock, par value $.10 per share ("Common Stock") pursuant to certain terms and conditions contained therein. WHEREAS, the parties hereto desire to amend and restate the Original Agreement as more fully set forth herein such that the terms and conditions contained in this agreement shall supercede and replace the terms and conditions set forth in the Original Agreement as if this Agreement had been the Original Agreement on its effective date. NOW THEREFORE, in consideration of the mutual covenants and obligations herein contained, the Corporation and the Optionee do hereby agree as follows: 1. GRANT OF OPTION. The Corporation hereby grants to the Optionee the right, privilege, and option to purchase (the "Option") from the Corporation Eleven Thousand Seven Hundred Eighty-Seven (11,787) shares of Common Stock (the "Optioned Shares"), in the manner and subject to conditions set forth in this Agreement, at Eight Dollars and Two Cents ($8.02) per share (the "Exercise Price"). 2. TERM OF OPTION. The Option, to the extent not exercised, shall terminate on the earlier of (a) April 15, 2008, which is the fifteenth (15th) anniversary of the initial grant date of April 15, 1993 (the "Grant Date") or (b) the date on which the Optionee's employment with the Corporation is terminated for Cause. The term "Cause" as used herein shall mean and include any of the following events: fraud or dishonesty, misappropriation or embezzlement by the Optionee involving the Corporation or any subsidiary or affiliate thereof; any violation of civil or criminal law; breach of confidentiality; the willful engaging by the Optionee in conduct which has or could reasonably be expected to have a material adverse effect on the Corporation or any of its subsidiaries or affiliates; or the material breach by the Optionee of any representations, warranties, agreements or covenants made by the Optionee in this Agreement or any other agreement between the Corporation and the Optionee. 3. TIME OF EXERCISE OF OPTION. The Option may be exercised by the Optionee (or, in the event of the Optionee's death, by the Optionee's legal representative or heirs) as to the Optioned Shares on or after the Grant Date, prior to the termination date as determined in accordance with Section 2 hereof. 4. METHOD OF EXERCISE OF OPTION. The Option shall be exercised by written notice (the "Notice of Exercise") from the Optionee (or, in the event of the Optionee's death, from the Optionee's legal representative or heirs) to the Corporation designating the number of Optioned Shares to be purchased and the desired date of purchase, which shall be not less than ten (10) nor more than thirty (30) days thereafter, accompanied by cash or by check, subject to collection and payable to the order of the Corporation, in payment of the Exercise Price for the designated number of Optioned Shares. 5. DELIVERY OF SHARES. Upon receipt by the Corporation from the Optionee of a Notice of Exercise and payment in full of the Exercise Price for the designated number of Optioned Shares, the Corporation shall deliver, as soon as administratively feasible, to the Optionee a certificate for such Optioned Shares issued in the name of the Optionee (the "Issued Shares"). Any such certificate shall bear conspicuously on its face the following legend: "The shares represented by this certificate are "restricted securities" as defined in and for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the "Act") and in the absence of an effective registration statement, these shares may not be sold, transferred, pledged, or hypothecated except in compliance with Rule 144 or another exemption from registration pursuant to the Act. " 6. RIGHTS PRIOR TO EXERCISE OF OPTION. The Option may not be sold, transferred, assigned, pledged, hypothecated, or otherwise disposed of in any way except upon the Optionee's death pursuant to the Optionee's will or the laws of the State of Vermont regarding a testator's estate, a spouse's elective share or other similar provision (the recipient of any such permitted transfer shall be know as a "Permitted Transferee"). The Optionee or any Permitted Transferee shall have no rights as a shareholder with respect to any Optioned Shares until delivery, in accordance with the provisions of Section 5 of this Agreement, of such Optioned Shares as Issued Shares. Any Permitted Transferee shall be subject to the Section 7 of this Agreement as if the Permitted Transferee was the Optionee. 7. RESTRICTED SHARES. The Optionee acknowledges that (a) the Issued Shares shall be "restricted securities" as defined in and for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the "Act"), (b) in the absence of an effective registration statement, the Issued Shares may not be sold, transferred, pledged, or hypothecated except in compliance with Rule 144 or another exemption from registration pursuant to the Act and (c) the Issued Shares will be evidenced by a certificate bearing the legend set forth in Section 5 of this Agreement. 8. NO PREEMPTIVE RIGHTS. The Optionee acknowledges that the acquisition of any Optioned Shares as Issued Shares under this Agreement does not confer on the Optionee any preemptive right to purchase, subscribe to, or be first offered any shares of any class of stock of the Corporation, presently or subsequently authorized, or any notes, debentures, bonds, or other securities of the Corporation convertible into, or carrying options or warrants to purchase, shares of any class of the stock of the Corporation, presently or subsequently authorized. 9. ADJUSTMENTS. In the event of any combination or division of the shares of Common Stock of the Corporation, or the payment of any dividend on such stock in shares of such stock, or any recapitalization in which such stock is changed into a different security, appropriate adjustments shall be made to the Optioned Shares as necessary to allow the provisions of this Agreement to operate as if such event(s) had not occurred. 10. NOTICES. All exercises of options, offers, acceptances, or other notices pursuant to this Agreement shall be made in writing and delivered within the applicable time period to the party entitled to such notice under this Agreement. Any such notice shall be effective either when tendered in person to the party entitled to such notice; or on the third (3rd) day after being deposited in the United States mail in a sealed envelope, registered or certified, with postage and postal charges prepaid, addressed to the address of such party as set forth above, or at such other address as may be designated by any of the parties hereto by notice to the other parties and if to the Corporation, with a copy to H. Kenneth Merritt, Jr., Esq., Merritt & Merritt, 30 Main Street, Suite 330, P.O. Box 5839, Burlington, VT 05402. 11. MISCELLANEOUS. 11.1 ASSIGNMENT. Except as otherwise specifically provided herein, this Agreement may not be assigned by any of the parties hereto. 11.2 BINDING EFFECT. This Agreement shall be binding upon the parties hereto and their respective heirs, distributees, personal representatives, successors and assigns. 11.3 AMENDMENTS. No modifications, amendment, addition to or termination of this Agreement, nor waiver of any of its provisions, shall be valid or enforceable unless in writing and signed by all of the parties hereto. 11.4 SEVERABILITY. The invalidity or unenforceability of any provisions hereof shall in no way affect the validity or enforceability of any other provisions. 11.5 ENTIRE AGREEMENT. This Agreement contains the entire agreement between the parties hereto with respect to the subject matter contained herein and supersedes, nullifies, voids and renders of no further force or effect all prior agreements between the parties hereto with respect to the subject matter contained herein. 11.6 WAIVER. Failure to insist upon strict compliance with any of the terms, covenants, or conditions hereof shall not be deemed a waiver of such term, covenant or condition nor shall any waiver or relinquishment of any right or power hereunder at any one time or more times be deemed a waiver or relinquishment of such right or power at any other time or times. 11.7 COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of which together shall be deemed one and the same instrument. 11.8 TITLES. The titles of all Sections are for convenience only and shall not be considered in construing the provisions hereof. 11.9 GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Vermont. IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement for the purposes contained herein as of the year and day first above written. GREEN MOUNTAIN COFFEE, INC. By: /s/ Robert P. Stiller --------------------------- Robert P. Stiller, President By: /s/ James K. Prevo ---------------------------- James K. Prevo EX-10.104 6 AMENDED AND RESTATED STOCK OPTION AGREEMENT AMENDED AND RESTATED STOCK OPTION AGREEMENT AMENDED AND RESTATED STOCK OPTION AGREEMENT, dated as of December 21, 1999 (the "Agreement"), by and between PAUL COMEY, and GREEN MOUNTAIN COFFEE, INC., a Delaware corporation with its principal place of business located at 33 Coffee Lane, Waterbury, Vermont 05676 (the "Corporation"). WHEREAS, the parties hereto are parties to that Stock Option Agreement effective as of April 15, 1993, as amended on July 21, 1993 and July 26, 1996 (the "Original Agreement"), which granted options to Paul Comey (the "Optionee") to acquire shares of the Corporation's Common Stock, par value $.10 per share ("Common Stock") pursuant to certain terms and conditions contained therein. WHEREAS, the parties hereto desire to amend and restate the Original Agreement as more fully set forth herein such that the terms and conditions contained in this agreement shall supercede and replace the terms and conditions set forth in the Original Agreement as if this Agreement had been the Original Agreement on its effective date. NOW THEREFORE, in consideration of the mutual covenants and obligations herein contained, the Corporation and the Optionee do hereby agree as follows: 1. GRANT OF OPTION. The Corporation hereby grants to the Optionee the right, privilege, and option to purchase (the "Option") from the Corporation Twenty-Three Thousand Five Hundred Seventy-Four (23,574) shares of Common Stock (the "Optioned Shares"), in the manner and subject to conditions set forth in this Agreement, at Eight Dollars and Two Cents ($8.02) per share (the "Exercise Price"). 2. TERM OF OPTION. The Option, to the extent not exercised, shall terminate on the earlier of (a) April 15, 2008, which is the fifteenth (15th) anniversary of the initial grant date of April 15, 1993 (the "Grant Date") or (b) the date on which the Optionee's employment with the Corporation is terminated for Cause. The term "Cause" as used herein shall mean and include any of the following events: fraud or dishonesty, misappropriation or embezzlement by the Optionee involving the Corporation or any subsidiary or affiliate thereof; any violation of civil or criminal law; breach of confidentiality; the willful engaging by the Optionee in conduct which has or could reasonably be expected to have a material adverse effect on the Corporation or any of its subsidiaries or affiliates; or the material breach by the Optionee of any representations, warranties, agreements or covenants made by the Optionee in this Agreement or any other agreement between the Corporation and the Optionee. 3. TIME OF EXERCISE OF OPTION. The Option may be exercised by the Optionee (or, in the event of the Optionee's death, by the Optionee's legal representative or heirs) as to the Optioned Shares on or after the Grant Date, prior to the termination date as determined in accordance with Section 2 hereof. 4. METHOD OF EXERCISE OF OPTION. The Option shall be exercised by written notice (the "Notice of Exercise") from the Optionee (or, in the event of the Optionee's death, from the Optionee's legal representative or heirs) to the Corporation designating the number of Optioned Shares to be purchased and the desired date of purchase, which shall be not less than ten (10) nor more than thirty (30) days thereafter, accompanied by cash or by check, subject to collection and payable to the order of the Corporation, in payment of the Exercise Price for the designated number of Optioned Shares. 5. DELIVERY OF SHARES. Upon receipt by the Corporation from the Optionee of a Notice of Exercise and payment in full of the Exercise Price for the designated number of Optioned Shares, the Corporation shall deliver, as soon as administratively feasible, to the Optionee a certificate for such Optioned Shares issued in the name of the Optionee (the "Issued Shares"). Any such certificate shall bear conspicuously on its face the following legend: "The shares represented by this certificate are "restricted securities" as defined in and for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the "Act") and in the absence of an effective registration statement, these shares may not be sold, transferred, pledged, or hypothecated except in compliance with Rule 144 or another exemption from registration pursuant to the Act. " 6. RIGHTS PRIOR TO EXERCISE OF OPTION. The Option may not be sold, transferred, assigned, pledged, hypothecated, or otherwise disposed of in any way except upon the Optionee's death pursuant to the Optionee's will or the laws of the State of Vermont regarding a testator's estate, a spouse's elective share or other similar provision (the recipient of any such permitted transfer shall be know as a "Permitted Transferee"). The Optionee or any Permitted Transferee shall have no rights as a shareholder with respect to any Optioned Shares until delivery, in accordance with the provisions of Section 5 of this Agreement, of such Optioned Shares as Issued Shares. Any Permitted Transferee shall be subject to the Section 7 of this Agreement as if the Permitted Transferee was the Optionee. 7. RESTRICTED SHARES. The Optionee acknowledges that (a) the Issued Shares shall be "restricted securities" as defined in and for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the "Act"), (b) in the absence of an effective registration statement, the Issued Shares may not be sold, transferred, pledged, or hypothecated except in compliance with Rule 144 or another exemption from registration pursuant to the Act and (c) the Issued Shares will be evidenced by a certificate bearing the legend set forth in Section 5 of this Agreement. 8. NO PREEMPTIVE RIGHTS. The Optionee acknowledges that the acquisition of any Optioned Shares as Issued Shares under this Agreement does not confer on the Optionee any preemptive right to purchase, subscribe to, or be first offered any shares of any class of stock of the Corporation, presently or subsequently authorized, or any notes, debentures, bonds, or other securities of the Corporation convertible into, or carrying options or warrants to purchase, shares of any class of the stock of the Corporation, presently or subsequently authorized. 9. ADJUSTMENTS. In the event of any combination or division of the shares of Common Stock of the Corporation, or the payment of any dividend on such stock in shares of such stock, or any recapitalization in which such stock is changed into a different security, appropriate adjustments shall be made to the Optioned Shares as necessary to allow the provisions of this Agreement to operate as if such event(s) had not occurred. 10. NOTICES. All exercises of options, offers, acceptances, or other notices pursuant to this Agreement shall be made in writing and delivered within the applicable time period to the party entitled to such notice under this Agreement. Any such notice shall be effective either when tendered in person to the party entitled to such notice; or on the third (3rd) day after being deposited in the United States mail in a sealed envelope, registered or certified, with postage and postal charges prepaid, addressed to the address of such party as set forth above, or at such other address as may be designated by any of the parties hereto by notice to the other parties and if to the Corporation, with a copy to H. Kenneth Merritt, Jr., Esq., Merritt & Merritt, 30 Main Street, Suite 330, P.O. Box 5839, Burlington, VT 05402. 11. MISCELLANEOUS. 11.1 ASSIGNMENT. Except as otherwise specifically provided herein, this Agreement may not be assigned by any of the parties hereto. 11.2 BINDING EFFECT. This Agreement shall be binding upon the parties hereto and their respective heirs, distributees, personal representatives, successors and assigns. 11.3 AMENDMENTS. No modifications, amendment, addition to or termination of this Agreement, nor waiver of any of its provisions, shall be valid or enforceable unless in writing and signed by all of the parties hereto. 11.4 SEVERABILITY. The invalidity or unenforceability of any provisions hereof shall in no way affect the validity or enforceability of any other provisions. 11.5 ENTIRE AGREEMENT. This Agreement contains the entire agreement between the parties hereto with respect to the subject matter contained herein and supersedes, nullifies, voids and renders of no further force or effect all prior agreements between the parties hereto with respect to the subject matter contained herein. 11.6 WAIVER. Failure to insist upon strict compliance with any of the terms, covenants, or conditions hereof shall not be deemed a waiver of such term, covenant or condition nor shall any waiver or relinquishment of any right or power hereunder at any one time or more times be deemed a waiver or relinquishment of such right or power at any other time or times. 11.7 COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of which together shall be deemed one and the same instrument. 11.8 TITLES. The titles of all Sections are for convenience only and shall not be considered in construing the provisions hereof. 11.9 GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of Vermont. IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement for the purposes contained herein as of the year and day first above written. GREEN MOUNTAIN COFFEE, INC. By: /s/ Robert P. Stiller ---------------------------- Robert P. Stiller, President By: /s/ Paul Comey ---------------------------- Paul Comey EX-27 7 FINANCIAL DATA SCHEDULE
5 This schedule contains summary financial information extracted from the Balance Sheet dated 1/15/00 and the Statement of Operations for the twelve weeks ended 1/15/00 and is qualified in its entirety by reference to such financial statements 0000909954 GREEN MOUNTAIN COFFEE, INC. 1,000 U.S. DOLLARS OTHER SEP-30-2000 SEP-26-1999 JAN-15-2000 1.000 1,083 0 7,140 210 5,074 13,751 19,159 8,827 24,467 8,054 4,456 0 0 362 11,595 24,467 24,742 24,742 14,696 14,696 6,049 0 141 2,168 868 1,300 0 0 0 1,300 0.38 0.37
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