10-K

UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C. 20549

FORM 10-K

(Mark One)
ý	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
	For the fiscal year ended September 27, 2014
OR
o	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

KEURIG GREEN MOUNTAIN, INC.
(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization)	03-0339228 (I.R.S. Employer Identification No.)
33 Coffee Lane, Waterbury, Vermont 05676 (Address of principal executive offices) (zip code)

(802) 244-5621
(Registrants' telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report.)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Stock, $0.10 par value per share	The Nasdaq Global Select Market

Securities registered pursuant to Section 12(g) of the Act: NONE

         Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes ý    No o

         Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes o    No ý

         Indicate by check mark whether the registrant (1) has 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 ý    No o

         Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes ý    No o

         Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o

         Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	ý	Accelerated filer	o
Non-accelerated filer	o	Smaller Reporting Company	o

         Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes o    No ý

         The aggregate market value of the voting stock of the registrant held by non-affiliates of the registrant on March 29, 2014 was approximately $17,446,088,000 based upon the closing price of such stock on March 28, 2014.

         As of November 14, 2014, 162,009,539 shares of common stock of the registrant were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

         Portions of the registrant's definitive Proxy Statement for the 2015 Annual Meeting of Stockholders to be filed with the Securities and Exchange Commission pursuant to Regulation 14A not later than 120 days after the end of the fiscal year covered by this Form 10-K, are incorporated by reference in Part III, Items 10-14 of this Form 10-K.

KEURIG GREEN MOUNTAIN, INC,

Annual Report on Form 10-K

For

Fiscal Year Ended September 27, 2014

Table of Contents

PART I		1
Item 1.	Business	1
Item 1A.	Risk Factors	14
Item 1B.	Unresolved Staff Comments	24
Item 2.	Properties	24
Item 3.	Legal Proceedings	25
Item 4.	Mine Safety Disclosures	25
PART II		26
Item 5.	Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Securities	26
Item 6.	Selected Financial Data	29
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	30
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	49
Item 8.	Financial Statements and Supplementary Data	52

Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	107
Item 9A.	Controls and Procedures	107
Item 9B.	Other Information	108
PART III		109
Item 10.	Directors, Executive Officers and Corporate Governance	109
Item 11.	Executive Compensation	109
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	109
Item 13.	Certain Relationships and Related Transactions, and Director Independence	109
Item 14.	Principal Accounting Fees and Services	109
PART IV		110
Item 15.	Exhibits, Financial Statement Schedules	110

PART I

FORWARD-LOOKING STATEMENTS

This report contains information that constitutes "forward-looking statements." Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as "believes," "expects," "anticipates," "estimates," "intends," "plans," "seeks" or words of similar meaning, or future or conditional verbs, such as "will," "should," "could," "may," "aims," "intends," or "projects." However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. These statements may relate to: the expected impact of raw material costs and our pricing actions on our results of operations and gross margins, expected trends in net sales and earnings performance and other financial measures, the expected productivity and working capital improvements, the success of introducing and producing new product offerings, the impact of foreign exchange fluctuations, the adequacy of internally generated funds and existing sources of liquidity, such as the availability of bank financing, our ability to issue debt or additional equity securities, our expectations regarding purchasing shares of our common stock under the existing authorizations, projections of payment of dividends, the impact of pending shareholder litigation, and the impact of pending antitrust litigation against the Company in the United States and Canada. A forward-looking statement is neither a prediction nor a guarantee of future events or circumstances, and those future events or circumstances may not occur. Management believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. We expressly disclaim any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our Company's historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to, those described in Part I, "Item 1A. Risk Factors," and Part II "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" and elsewhere in this report and those described from time to time in our future reports filed with the Securities and Exchange Commission.

Item 1.    Business

Overview

We believe that we are a leader in specialty coffee, coffeemakers, teas and other beverages in the United States and Canada. We consider ourselves an innovative, technology-driven, values-based personal beverage system company. Our multi-brand beverage and brewer portfolio is aimed at changing the way consumers prepare and enjoy coffee and other beverages both at home and away from home. We develop and sell a variety of Keurig® brewers and produce and sell specialty coffee and other specialty beverages in portion packs including hot apple cider, hot and iced teas, iced coffees, iced fruit brews, hot cocoa and other beverages for use with our Keurig® hot brewing systems. We also offer traditional whole bean and ground coffee in other package types including bags, fractional packages and cans. We market and sell our products to retailers including supermarkets, department stores, mass merchandisers, club stores, and convenience stores; to restaurants, hospitality accounts, office coffee distributors, and partner brand owners; and to consumers through our Company websites. We have differentiated our Company and our Keurig® brand with our ability to partner with other beverage brand companies in order to bring consumers significant beverage and brand choice in our Keurig® Brewing systems. We currently offer more than 385 beverage varieties and over 50 brands as part of the Keurig® system. Unless the context indicates otherwise, the terms "Keurig", the "Company", "we", "our", or "us" refer to Keurig Green Mountain, Inc., together with its subsidiaries.

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As of the end of our 2014 fiscal year, we had the top four best-selling coffeemakers by dollar volume in the United States according to the NPD Group for consumer market research data. Under the Keurig® brand name, we offer a variety of brewers for commercial use in the Away From Home ("AFH") channel and for home use in the At Home ("AH") channel that are differentiated by features and size.

In recent years, growth in the coffee industry has come primarily from the specialty coffee category, fueled by the emergence of specialty coffee shops throughout the U.S. and Canada. Single-serve has been the fastest growing segment of the specialty coffee category. Concurrently, consumers are more frequently seeking to enjoy premium experiences within the comfort and convenience of their own homes, including the consumption of specialty coffee. In addition to what we believe to be our carefully developed and distinctive advantages over our competitors, the Company has been benefiting from these broad consumer trends.

Our growth strategy involves using our consumer insights to develop innovative new brewing systems and beverages; continually improving and refining our current systems and beverages; and, developing and managing marketing programs to drive Keurig® Brewing system adoption in order to generate ongoing demand for portion packs. We currently target opportunities primarily in American and Canadian households, food service, educational and office locations. Over the longer term, we also will work to expand our addressable opportunity globally. As part of our strategy, we work to sell our at-home hot system brewers at attractive price points which are approximately at cost, or at a loss when factoring in the incremental costs related to sales, in order to drive the sales of profitable portion packs. In addition, we have license agreements with Breville PTY Limited (producer of Breville® brand coffeemakers), Jarden Consumer Solutions (producer of Mr. Coffee® brand coffeemakers) and Conair Corporation (producer of Cuisinart® brand coffeemakers), under which each produce, market and sell coffeemakers co-branded with Keurig®.

In recent years, our growth has been driven predominantly by an increase in adoption of Keurig® hot brewing systems, which include both the brewer and the related portion packs. In fiscal 2014, approximately 94% of our consolidated net sales were attributed to the combination of portion packs and Keurig® brewers and related accessories.

While our recent growth has been predominantly driven by an increase in adoption of Keurig® hot brewing systems, we have been developing the Keurig Cold™ beverage system for more than five years. During fiscal 2014, we continued to work towards commercializing the Keurig Cold™ beverage system and we plan to introduce the product in fiscal 2015. Keurig Cold™ is an in-home cold beverage system that will use precisely formulated single-serve pods to dispense freshly-made cold beverages including carbonated drinks, enhanced waters, sports drinks and teas with the one-touch simplicity, quality and variety that North American consumers love about the Keurig® brand hot system platform.

We believe that the Keurig Cold™ beverage system will meet a number of consumer needs, including:

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delivering the beverage cold versus ambient;

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offering a consistent and simple carbonation process at the touch of a button;

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enabling consistent and exact dosing of different levels of carbonation and flavoring;

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offering wide brand choice and variety; and

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being offered at an attractive price point similar to our Keurig® hot platform brewer line-up, with a footprint suitable for a kitchen counter.

In support of the manufacturing of Keurig Cold™ single-serve pods, in fiscal 2014 we began construction on a Keurig Cold™ early production center in Vermont, where we will operate the first pod production lines. Additionally, during fiscal 2014, we purchased a 585,000 square foot facility in Lithia Springs, Georgia that will be dedicated to Keurig Cold™ production. We anticipate that we will make significant investments in ramping up this new Keurig Cold™ production facility in

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order to meet anticipated consumer demand for Keurig Cold™ single-serve pods.

As with our Keurig® hot platform, we plan to have multiple brands and multiple partners in our Keurig Cold™ beverage system over time to offer the world's finest cold beverages to Keurig consumers.

During fiscal 2014, we announced the first significant partnership related to the Keurig Cold™ beverage system: a 10-year agreement to collaborate on the development and introduction of The Coca-Cola Company® global brand portfolio for use in the Keurig Cold™ beverage system. Under the global strategic agreement, Keurig and The Coca-Cola Company will cooperate to bring the Keurig Cold™ beverage system to consumers around the world. We believe that having The Coca Cola Company as our strategic partner and collaborator will amplify and accelerate changing the way consumers create and enjoy beverages at home. We are working closely with The Coca-Cola Company to develop and perfect some of their brands for our Keurig Cold™ system, as well as developing a variety of our own new brands to be launched in the Keurig Cold™ beverage system and working with other potential Keurig Cold™ beverage system partners.

Business Segments

Segment information is prepared on the same basis that our CEO, who is our chief operating decision maker, manages the business, evaluates financial results, and makes key operating decisions. The structure includes a Domestic segment containing all U.S. Operations and immaterial operations related to international expansion, and a Canada segment containing all Canadian operations. See Note 4, Segment Reporting, of the Notes to Consolidated Financial Statements included in this Annual Report.

Domestic.    The Domestic segment designs and sells hot beverage system brewers and accessories and sources, produces and sells coffee, hot cocoa, teas and other beverages under a variety of brands in K-Cup®_, Vue®, Rivo®, K-Carafe™ and Bolt™ portion packs ("portion packs"), and coffee in more traditional packaging, including bags and fractional packs, to retailers including supermarkets, department stores, mass merchandisers, club stores, and convenience stores; to restaurants, hospitality accounts, office coffee distributors, and partner brand owners; and to consumers through a consumer-facing website.

Canada.    The Canada segment sells hot beverage system brewers and accessories, and sources, produces and sells coffee and teas and other beverages under a variety of brands in K-Cup®, Rivo® and K-Carafe™ portion packs, and coffee in more traditional packaging, including cans, bags and fractional packs, to retailers including supermarkets, department stores, mass merchandisers, club stores, office coffee distributors, and, through its office coffee services business, to offices, convenience stores, restaurants, hospitality accounts, and to consumers through its consumer-facing website.

Business Relationships

Our business relationships with participating brands are generally established through licensing or manufacturing arrangements.

Under licensing arrangements, we license the right to manufacture, distribute and sell the finished products through our distribution channels using the brand owners' marks. For the right to use a brand owner's mark, we pay a royalty to the brand owner based on our sales of finished products that contain the brand owner's mark.

Under manufacturing arrangements, we manufacture finished beverage products using raw materials sourced by us or provided by the brand owner. In both instances, once the manufacturing process is complete, we sell the finished product either to the brand owner or to our customers. Under certain manufacturing arrangements, our sole customer is the brand owner and we are prohibited from selling the beverage products to other types of customers through our distribution channels. Under other manufacturing arrangements, in addition to manufacturing the beverage for sale to the brand owner, we have the right to sell the beverages using the brand owner's marks in certain of our channels through a licensing arrangement, as described above.

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Our Strengths

We believe our innovative system approach provides us with a unique competitive advantage in the marketplace, as we design all aspects of the system, including the beverage, the portion pack, the portion pack manufacturing lines, the appliance and its components. We believe that the consumer benefits delivered by our Keurig® beverage system will preserve our leadership position in the marketplace and give us significant opportunity to continue to grow our coffee business and do for other beverage categories what we have done for coffee. We also believe we have differentiated our Company and our Keurig® brand with our ability to partner with other beverage brand companies in order to bring consumers significant beverage and brand choice in our Keurig® Brewing systems. Finally, we continue to invest to ensure innovation in our current brewing systems and to enable us to develop and market new systems for adjacent categories.

We believe the primary consumer benefits delivered by our Keurig® Brewing system are as follows:

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Quality—expectations of the quality of coffee consumers drink have increased over the last several years and, we believe, with the Keurig® system, consumers can be certain they will get a high-quality, consistently produced beverage every time.



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Convenience—the Keurig® system prepares beverages generally in less than a minute at the touch of a button with no mess, no fuss.



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Choice—with many beverage brands across multiple beverage categories, Keurig offers more than 385 individual varieties, allowing consumers to enjoy and explore a wide range of beverages. In addition to a variety of brands of coffee and tea, we also produce and sell iced teas, iced coffees, hot and iced fruit brews, hot cocoa and other dairy-based beverages, in portion packs.

We see these benefits as being our competitive advantage and believe it is the combination of these attributes that makes Keurig® Brewing systems appealing to consumers.

Our Strategy

We are focused on building our brands, diversifying our product lines and profitably growing our business. We believe we can continue to grow sales by increasing consumer awareness of the Keurig® brand in the United States and Canada; expanding into new geographic regions; expanding consumer choice of coffee, tea and other beverages in our existing brewing systems; developing and introducing new brewing platforms; expanding sales in adjacent beverage industry segments; and/or selectively pursuing other synergistic opportunities.

The key elements of our business strategy are as follows:

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Increasing adoption of the Keurig® hot brewing systems in the United States and Canada;

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Expanding beverage choice through both our owned and partner brand offerings;

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Expanding in current channels;

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Launching new, innovative beverage system technologies and platforms; and,

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Continuing international expansion.

Increasing adoption of the Keurig® hot brewing systems in the United States and Canada.    While we are positioned as a leader in the hot beverage marketplace, we have opportunities in the United States and Canada to increase brand awareness and household penetration. In our fiscal year 2014 we launched our Keurig® 2.0 Beverage System—the first Keurig® brewer to brew both a single cup and a carafe. Extending the Keurig® value proposition to include a carafe option for at-home users allows us to target an incremental need of consumers for brewing larger volumes quickly and simply. We are also implementing measures to improve the shopping experience at retail to further distinguish the Keurig® brand

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and enhance brand recognition. Additionally, we are launching targeted marketing campaigns to increase regional household penetration in certain geographic areas through increased awareness, trial and conversion. As we continue to introduce the new Keurig® 2.0 Beverage System in fiscal 2015, we anticipate that we will continue to incur transition costs through the first year of launch including higher brewer costs for the new 2.0 appliances as compared to the earlier reservoir model appliances leading to lower gross margins.

Expanding beverage choice through both our owned and partner brand offerings.    In fiscal 2014, we continued to expand consumer choice in the Keurig® Brewing system by entering into or extending a number of business relationships across multiple channels and geographies for use with Keurig® brewers. Expanded or new brand partnerships announced in fiscal year 2014 included Krispy Kreme®, Lavazza, Laura Second®, Peet's Coffee & Tea, Folgers®, Folgers Gourmet Selections®, Café Bustelo®, Millstone®, Seattle's Best Coffee®, Nestle® Coffee-mate®, Maxwell House®, Gevalia®, Yuban®, McCafé® and Honest Tea®. In addition, we also signed agreements to produce store brands for stores including BJ's Wholesale Club, Harris Teeter, Target and W.B. Mason. These are in addition to our existing relationship to produce Costco Wholesale Corporation's Kirkland Signature™ brand. We believe these new brand and product offerings fuel excitement for current Keurig® brewer owners and users; raise system awareness; attract new consumers to the system; and promote expanded use of the Keurig® Brewing system. These relationships are established with careful consideration of potential economics. As we continue to add new brands including store brands into our system, some of which do not involve the Company in all activities in the value chain, we expect to see period-to-period fluctuations in our portion pack net sales and gross profit depending on the sales mix by brand. We expect to continue to enter into these mutually beneficial relationships in our efforts to expand choice and diversify our portfolio of brands with the expectation that they will lead to increased Keurig® Brewing system awareness and household adoption, in part through the participating brands' advertising and merchandising activities.

Expanding in current channels.    We have identified and are targeting specific opportunities within our existing channels, specifically the AFH channel, including food service, workplace, higher education and hospitality locations. These are areas where we have substantial room to grow, considering we are currently in less than one percent of food service outlets. We began addressing this opportunity by forming a partnership with the SUBWAY® restaurant chain to bring Keurig® brewers to many of the restaurant brand's North American locations.

Launching new, innovative beverage system technologies and platforms.    We are also focused on continued innovation in both hot and cold beverage systems. Some of our recent initiatives and planned product introductions include:

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An expansion of the Keurig® hot beverage brewing system with the introduction of Keurig® Bolt™, a new commercial grade batch brewing platform which became available in spring of 2014;

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The introduction of Keurig® 2.0, our next generation at-home hot beverage system. Keurig® 2.0 is the first Keurig® brewer to brew both a single cup and up to a four-cup carafe from a Keurig® brand pack providing Keurig® consumers with even greater beverage choice with the same Keurig simplicity and convenience they expect from Keurig. Keurig® 2.0 also is the first Keurig® brewer to feature Keurig® 2.0 Brewing Technology™, which enables the brewer to recognize the inserted Keurig® portion pack and optimize to the recommended, customized setting for that particular beverage. The Keurig® 2.0 Brewing Technology™ ensures that the Keurig® 2.0 system delivers on the promise of excellent quality beverages, produced simply and consistently, every single time;

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An estimated launch of the Keurig Cold™ beverage system in fiscal 2015. Keurig Cold™ will deliver freshly prepared cold carbonated, sparkling and still beverages. During fiscal 2014, we announced the first significant partnership related to the Keurig Cold™ beverage system: a 10-year agreement to collaborate on the development and introduction of The Coca-Cola Company's®

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global brand portfolio for use in the Keurig Cold™ at-home beverage system. Under the global strategic agreement, Keurig and The Coca-Cola Company will cooperate to bring the Keurig Cold™ beverage system to consumers around the world.

Continuing international expansion.    Continuing into fiscal 2015, we are planning to launch our Keurig® hot system global platform in targeted countries outside of North America. In our fiscal 2014, we launched a Keurig® brewer in the away from home channel in the United Kingdom.

Corporate Objective and Philosophy

Our Company's objective is to be a leader in the beverage business by selling high-quality, premium beverages and innovative brewing systems that consistently provide a superior beverage experience. Increasingly, we are also developing expertise in providing other brewing system choices.

Our purpose: "Create the ultimate beverage experience in every life we touch from source to cup—transforming the way the world understands business" guides our approach to business.

Our mission: "A Keurig® brewer on every counter and a beverage for every occasion" drives our strategy.

Essential elements of our philosophy and approach include:

High-Quality Beverages.    We are passionate about providing high quality beverages including roasting great coffees from some of the highest-quality Arabica beans available from the world's coffee-producing regions and using a roasting process designed to optimize each coffee's individual taste and aroma. We are also passionate about providing other high-quality beverages such as teas, sourced from premium tea growing regions.

Innovative Brewing Technology.    Our proprietary brewing technology, embodied in our portfolio of premium quality beverage machines and portion packs, provides the benefits of convenience, variety and great taste consistently. Keurig® Brewing systems include the following elements:

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Proprietary portion packs, which contain precisely portioned amounts of gourmet coffees, cocoa, teas and other products/offerings in a sealed, low oxygen environment to help maintain freshness.

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Premium quality brewers and beverage systems that precisely control the amount, temperature and pressure of water to provide a cup of coffee, tea, cocoa or other beverage of a consistent high quality when used with our own or licensed portion packs.

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Convenience of one-touch brewing which allows consumers to enjoy the perfect cup simply and quickly, in some cases in less than a minute, as well as the ability to increasingly customize beverages with accessible software-enabled user interfaces.

Keurig's hot beverage brewing system has been designed and optimized for producing consistent, high-quality coffee. In addition, we have expanded our hot system beverage selection to include other beverages such as hot apple cider, hot cocoa, brew-over-ice teas, coffees and fruit brews. We believe these beverages can help to increase brewer usage occasions and enhance consumer satisfaction. New beverage development work has also generated proprietary know how and/or patent applications. The Company holds U.S. and international patents covering a range of its portion pack and brewing technology innovations, with additional patent applications in process. We believe our constant innovation and focus on quality, all directed to delivering a consistently superior beverage, are what differentiates us among competitors in the beverage and beverage system industry.

Product Distribution.    The Company seeks to create consumers for life. We believe that coffee and other beverages are convenience purchases, and we utilize our multi-channel distribution network of distributor, retail and consumer direct options to make our products widely and easily available to consumers.

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Sustainable Business Practices.    We view sustainability as integral to our success. We have a long history of supporting social and environmental initiatives, particularly in our operations, communities and supply chain. We strive to manage and minimize negative impacts throughout the value chain where possible and have three sustainable business practice areas where we define goals and measure our progress: Resilient Supply Chain, Sustainable Products, and Thriving People and Communities. We believe our Company can uniquely contribute to local and global water challenges by combining our strengths in sustainability, innovation, and partnership. To start, by 2020 we aim to provide access to clean water to one million people worldwide in addition to educating and mobilizing North Americans around the water crisis. To learn more about our programs visit www.keuriggreenmountain.com/Sustainability/Overview.aspx.

Corporate Culture.    At Keurig, we believe in doing business with a purpose. Since our beginning in 1981, we have operated to benefit our consumers, our customers, our employees, and our communities by deeply embedding our values, ethics and integrity into all that we do. The way we think, act, lead, partner, and execute is guided by our values. Our Code of Conduct is posted on our corporate website and explains how we integrate our purpose, mission, and values into our daily decisions. It demonstrates our Company's commitment to our stakeholders to be a responsible corporate citizen and a good business partner.

The Products

Portion Packs

The Company offers portion packs of varying sizes including single-serve K-Cup®, Vue® and Rivo® packs as well as multi-serve K-Carafe™ packs capable of producing a three to four cup carafe and Bolt™ packs capable of producing a 64 ounce carafe. We offer high-quality Arabica bean coffee including single-origin, Fair Trade Certified™, Rain Forest Alliance Certified™, organic, flavored, limited edition and proprietary blends. We also procure Robusta bean coffee for use in certain blends. We carefully select our coffee beans and appropriately roast the coffees to optimize their taste and flavor differences. We manufacture and sell portion packs of our own brands and participating brands through licensing and manufacturing agreements. We offer brand choice such as Caribou Coffee®, Dunkin' Donuts™, Eight O'Clock®, Emeril's®, Folgers®, Folgers Gourmet Selections®, Gloria Jean's®, Kirkland Signature™, Krispy Kreme®, Lavazza®, Millstone®, Newman's Own® Organics and Starbucks®. The Company has licensing agreements for tea with Unilever North America (Lipton®), Celestial Seasonings, Inc. (Celestial Seasonings® branded teas and Perfect Iced Tea®), Good Earth® Corporation and Tetley® USA, Inc. (Good Earth® and Tetley® branded teas), R. C. Bigelow, Inc. (Bigelow® branded teas), Snapple Beverage Corp. (Snapple® branded teas), Starbucks Corporation (Tazo® and Teavana®) and Associated British Foods plc (Twinings of London®) for manufacturing, distribution, and sale of portion packs. In addition to coffee and tea, we also produce and sell portion packs for lemonade and hot apple cider under our Green Mountain Naturals™ brand, iced fruit brews under our Vitamin Burst™ brand, cocoa and other dairy-based beverages under our Café Escapes™ brand, and cocoa under the Swiss Miss® brand.

Brewers and Accessories

We are a leader in sales of coffeemakers in the U.S. and Canada. As of the end of our 2014 fiscal year, we had the top four best-selling at-home coffeemakers by dollar volume in the United States according to the NPD Group for consumer market research data in the United States. Under the Keurig® K-Cup®, Keurig® Vue®, Keurig Bolt™, Keurig® 2.0 and co-branded Keurig® Rivo® brand names, we offer a variety of commercial and home use brewers for the AFH and AH channels differentiated by features and size.

In addition, we have license agreements under which licensees manufacture, market and sell coffeemakers co-branded with "Keurig® Brewed". Licensees include Breville PTY Limited (producer of Breville® brand coffeemakers), Jarden Consumer Solutions selling a "Mr. Coffee®" branded brewer and Conair Corporation selling a "Cuisinart®" branded brewer.

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We offer a variety of accessories for the Keurig® Brewing platforms including K-Cup®, Vue®, Rivo®, K-Carafe™, and Bolt™ pack storage racks, baskets, and brewer carrying cases. We also sell other coffee-related equipment and accessories, gift assortments, hand-crafted items from coffee-source countries and gourmet food items covering a wide range of price points.

Other Products and Royalties

The Company sells coffee in other package types in addition to portion packs such as bagged coffee and cans (for the grocery and mass channels) and fractional packages and ancillary products (for the office coffee and food service channels). The Company also earns royalties from licensees under various licensing agreements.

Customers

For our at home business sold through retailers, department stores and mass merchants in the Domestic segment, we rely primarily on one fulfillment entity, M.Block & Sons, Inc. ("MBlock"), to process the majority of orders. Our sales processed through MBlock represented 36%, 37% and 38% of the Company's consolidated net sales for fiscal years 2014, 2013 and 2012, respectively. To a lesser extent, we also use other third-parties in the U.S. and Canada for fulfillment services in the AH channel. Further, we are reliant on certain customers for a substantial portion of our revenues, whether the related orders are processed through fulfillment entities or by us. Wal-Mart Stores, Inc. and its affiliates represented approximately 17%, 14% and 12% of our consolidated net sales for fiscal 2014, 2013 and 2012, respectively; and Costco Wholesale Corporation and affiliates represented approximately 12% and 11% of our consolidated net sales for fiscal 2014 and 2013, respectively.

Net Sales

For fiscal 2014, approximately 94% of our consolidated net sales were attributed to the combination of portion packs and Keurig® brewers and related accessories. Fiscal 2014 net sales of $4,707.7 million were comprised of $3,604.5 million portion pack net sales, $822.3 million Keurig® brewer and accessories net sales and $280.9 million of other product net sales such as whole bean and ground coffee selections in bags, fractional packages, and cans, as well as cups, lids and ancillary items to our customers primarily in the U.S. and Canada.

Supply Chain

We operate production and distribution facilities in North America in Castroville, California; Knoxville, Tennessee; Essex, Waterbury and Williston, Vermont; Windsor, Virginia; Sumner, Washington; and Montreal, Quebec. Our production facilities include specially designed proprietary high-speed packaging lines that manufacture portion packs using freshly-roasted and ground coffee as well as tea, cocoa and other products.

In addition, during fiscal 2014 we began construction on a Keurig Cold™ early production center in Vermont, purchased a 585,000 square foot facility in Lithia Springs, Georgia that will be dedicated to Keurig Cold™ production, consolidated all of our Canadian coffee and portion pack production in Montreal, Quebec, and discontinued production in Toronto, Ontario.

We utilize third-party contract manufacturers located primarily in China and Malaysia for brewer manufacturing. In order to ensure the quality and consistency of our products manufactured by third-party manufacturers in Asia, we have an Asian-based research and development and quality control function that provides manufacturing oversight, project management, and quality support.

Green Coffee Cost and Supply

We purchased approximately 228 million pounds of coffee in fiscal 2014. We utilize a combination of outside brokers and direct relationships with farms, estates, cooperatives and cooperative groups for our supply of green coffee. Outside brokers provide the largest supply of our green coffee.

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In fiscal 2014, approximately 19% of our purchases were from Fair Trade certified sources. This provides an assurance that farmer groups are receiving the Fair Trade minimum price and an additional premium for certified organic products. In fiscal 2014, approximately 4% of our purchases were from Rain Forest Alliance Certified™ farms. Rainforest Alliance Certified™ coffee is grown using methods that help promote and preserve biodiversity, conserve scarce natural resources, and help farmers build sustainable lives. In fiscal 2014, approximately 64% of our purchases were from traceable sources, which means that we can identify the farms, estates or co-ops, and develop a relationship directly with the farmers. We believe that the traceability helps us secure long-term supplies of high-quality coffee.

The supply and price of coffee are subject to high volatility. Supply and price of all coffee grades are affected by multiple factors, such as weather, pest damage, politics, competitive pressures, the relative value of the United States currency and economics in the producing countries.

Marketing and Distribution

To support customer growth in the U.S. and Canada, we utilize separate selling organizations and different selling strategies for each of our multiple channels of distribution. Both of our segments operate in the AH, AFH and consumer direct channels.

In the AH channel, we target coffee drinkers who wish to enjoy the speed, convenience and quality of Keurig® brewed beverages. We promote our AH brewing system which includes portion packs manufactured by the Domestic and Canada segments primarily through mass merchants, specialty and department store retailers, select wholesale clubs and on our website. We also use regionally targeted and national television advertising to promote our AH brewing systems. We rely on MBlock to process a significant amount of our sales orders for our AH business with retailers in the United States. In addition, we rely on a single order fulfillment entity to process the majority of sales orders for our AH business with retailers in Canada. In the AH channel within both the Domestic and Canada segments, our personnel work closely with key retail channel entities on product plans, marketing programs and other product sales support. Initiatives could include online promotional campaigns, circular advertising, in-store demos, mobile marketing, merchandising features and display, and local and national advertising. The Domestic and Canada segments market and sell portion packs for use in Keurig® brewers, as well as other package formats, such as bagged coffee, to supermarkets, grocery stores and certain wholesale clubs for use in AH applications.

In the AFH channel, our Domestic segment primarily targets the office coffee channel with a broad offering of brewing platforms that we believe significantly upgrade the quality of the coffee served in the workplace, as well as the food service and hospitality industries. The Domestic segment promotes its AFH brewing system through a selective, but non-exclusive, network of AFH distributors in the U.S. ranging in size from local to national. Keurig® brewers and portion packs are also available at retail in office superstore locations and directly to small offices through our e-commerce platform. To a lesser degree, the Canada segment markets and sells its coffee and beverage products to the office coffee channel through their AFH distributors. The Canada segment operates a coffee service and distribution network primarily in Canada. The office coffee services business provides office coffee products including a variety of coffee brands and blends, brewing and beverage equipment and beverage supplies directly to offices. Beyond the office coffee channel, we are active in marketing and selling our products to other AFH channels such as food service, convenience, hospitality and business-oriented e-commerce.

We also operate websites and social media pages that present our brands to consumers, and serve as e-commerce platforms. This channel provides the opportunity for us to develop relationships with our consumers via electronic communication.

Competition

We compete primarily in the coffee and coffeemaker marketplaces.

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The coffee marketplace is highly competitive and fragmented. Our coffee, tea and other beverages compete directly against coffees and teas sold through supermarkets, club stores, mass merchants, specialty retailers and food service accounts, and indirectly against all other coffees. Our competitors in the coffee marketplace include large national and international companies, some of which have greater resources, including marketing and operating resources, and numerous local and regional companies. We compete for limited retailer shelf space for our products, and some of those retailers also market competitive products under their own private labels. We also compete with the conventional products of larger companies. Products are distinguished based on quality, price, brand recognition and loyalty, innovation, promotions, nutritional value, and further by our ability to identify and satisfy consumer preferences.

Similar to the coffee marketplace, the coffeemaker marketplace is also highly competitive, and we compete against larger companies that possess greater marketing and operating resources than our Company. The primary methods of competition are essentially the same as in the coffee marketplace: price, quality, product performance and brand differentiation. In coffeemakers, we compete against all sellers of coffeemakers including companies that produce traditional pot-brewed coffeemakers and other single serve manufacturers, which include, but are not limited to the following:

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Bunn-O-Matic Corporation

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Mars, Inc. (through its FLAVIA® unit)

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Conair, Inc.

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Hamilton Beach / Proctor-Silex, Inc.

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Jarden Corporation

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Nestle S.A. (including its Dolce-Gusto® and Nespresso® brewing systems)

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D.E. Master Blenders 1753 N.V., controlled by JAB Holding Co. (including its SENSEO® brewing system)

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Mondelez International, Inc. (including its TASSIMO® brewing system)

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Stanley Black & Decker, Inc.

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Starbucks Corporation (including its Verismo® brewing system)

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Whirlpool Corporation

We expect competition in coffee and coffeemakers to remain intense, both within our existing customer base and as we expand into new regions. In both coffee and coffeemakers, we compete primarily by providing a wide variety of high-quality coffee including flavored, Fair Trade Certified™ and organic coffees as well as other beverages, coffeemakers, easy access to our products, superior customer service and a comprehensive approach to customer relationship management. We believe that our ability to provide a convenient and broad network of outlets from which to purchase our products is an important factor in our ability to compete. Through our multi-channel distribution network of wholesale, retail and consumer direct operations we believe we differentiate ourselves from many of our larger competitors, who specialize in only one primary channel of distribution. We believe our constant innovation and focus on quality, all directed to delivering a consistently superior cup of coffee, differentiate us among competitors in the coffeemaker industry. We also seek to differentiate ourselves through our socially and environmentally responsible business practices. While we believe we currently compete favorably with respect to all of these factors, there can be no assurance that we will be able to compete successfully in the future.

We compete not only with other widely advertised branded products, but also with private label or generic products that generally are sold at lower prices.

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Research and Development

Our research and development team includes scientists and engineers who are focused on developing beverage and appliance technology platforms that have broad appeal to consumers and consistently deliver on the key attributes of quality, convenience and choice. Research and development costs are expensed as incurred and amounted to $76.5 million, $57.7 million and $41.7 million for fiscal years 2014, 2013 and 2012, respectively. These costs primarily consist of salary and consulting expenses and are recorded in selling and operating expenses in each respective segment.

Intellectual Property

The Company owns a number of United States trademarks and service marks that have been registered with the United States Patent and Trademark Office. We anticipate maintaining our trademark and service mark registrations with the United States Patent and Trademark Office. We also own other trademarks and service marks for which we have applications for U.S. registration. The Company has further registered or applied for registration of certain of its trademarks and service marks in the United Kingdom, the European Union, Canada, Japan, the People's Republic of China, South Korea, Taiwan and other foreign countries. The Company has licenses to use other marks, all subject to the terms of the agreements under which such licenses are granted. We believe, as we continue to build brands, most notably today in the U.S. and Canada, our trademarks are valuable assets. Although the laws vary by jurisdiction, trademarks generally are valid as long as they are in use and/or their registrations are properly maintained and have not been found to have become generic. Trademark registrations generally can be renewed indefinitely as long as the trademarks are in use. We believe that our core brands are covered by trademark registrations in the countries where we do business and/or may do business in the near future. We have an active program designed to ensure that our marks and other intellectual property rights are registered, renewed, protected and maintained. In addition, the Company owns numerous copyrights, registered and unregistered, and proprietary trade secrets, technology, know-how processes and other proprietary rights that are not registered.

The Company holds U.S. patents and international patents related to our Keurig® Brewing and portion pack technology. Of these, a majority are utility patents and the remainder are design patents. We view these patents as very valuable but do not view any single patent as critical to the Company's success. We own patents that cover significant aspects of our products. We have pending patent applications associated with certain elements of current K-Cup® pack technology which, if ultimately issued as patents, would extend coverage over all or some portion of K-Cup® packs, and have expiration dates extending to 2023. We have patents associated with certain elements of our K-Cup® pack technology issued in various countries outside the United States. Certain elements of the current generation of Vue® and K-Carafe™ packs are covered by patents which expire in 2021 and by others that are still pending. In addition, the Company has various issued and pending patents that relate to the Keurig® 2.0 Beverage System, as well as to Keurig Cold™. Our pending patent applications may not issue, or if they issue, they may not be enforceable, may be challenged, invalidated or circumvented by others. Further, we continue to invest in further innovation in beverage packs and appliance technology that will enhance our patent position and that may lead to new patents, and take steps we believe are appropriate to protect all such innovation.

We have diligently protected our intellectual property through the use of domestic and international patents and trademark registrations and through enforcement efforts in litigation. We regularly monitor commercial activity in the countries where we do business and/or may do business and evaluate potential infringement.

Seasonality

Our business is subject to seasonal fluctuations, including fluctuations resulting from the holiday season. As a result, total inventory, and specifically, brewers and accessories finished goods inventory is

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considerably higher during the last fiscal quarter than other quarters during the fiscal year, as we prepare for the holiday season. Due to the shift in product mix toward brewers and accessories in the first quarter of our fiscal year, gross margin, as a percentage of net sales, is typically lower in the first fiscal quarter than in the remainder of the fiscal year. Historically, in addition to variations resulting from the holiday season, we have experienced variations in sales from quarter-to-quarter due to a variety of other factors including, but not limited to, the cost of green coffee, competitor initiatives, marketing programs and weather. Because of the seasonality of our business, results for any quarter are not necessarily indicative of the results that may be achieved for the full fiscal year.

Working Capital

In order to meet the increased level of demand for our consumer products, we typically build our inventory of brewers and accessories during the fourth quarter of our fiscal year. Funding for working capital items, including inventory and receivables, has been obtained through cash flows from operations, and historically included borrowings from our existing credit facilities. For a description of our liquidity and capital resources, see the "Liquidity and Capital Resources" section of "Management's Discussion and Analysis of Financial Condition and Results of Operations," and Note 10, Long-Term Debt, of the Notes to Consolidated Financial Statements.

Employees

As of September 27, 2014, the Company had approximately 6,600 full-time, part-time, and seasonal employees. We believe our current relations with our employees are good. The number of employees covered by collective bargaining agreements is not significant. We supplement our workforce with temporary workers from time to time, especially in the first quarter of each fiscal year to service increased customer and consumer demand during the peak November-December holiday season and January-March post-holiday season.

Executive Officers of the Registrant

Certain biographical information regarding each executive officer of our Company as of November 14, 2014 is set forth below:

Name	Age		Position	Officer since
Brian P. Kelley		53	President, Chief Executive Officer and Director		2012
Frances G. Rathke		54	Chief Financial Officer and Treasurer		2003
Robert P. Ostryniec		53	Chief Product Supply Officer		2013
Stéphane Glorieux		47	President, Keurig Canada		2014
Linda Longo-Kazanova		61	Chief Human Resources Officer		2011
Michael J. Degnan		50	Chief Legal Officer, Corporate General Counsel and Corporate Secretary		2013
Stephen L. Gibbs		42	Vice President and Chief Accounting Officer		2011
John F. Whoriskey		64	President, U.S. Sales and Marketing		2013

Brian P. Kelley joined Keurig as President, Chief Executive Officer and Director in December 2012. From 2011 until November 2012, Mr. Kelley served as Chief Product Supply Officer, Coca-Cola Refreshments. From 2010 to 2011 Mr. Kelley served as President of Coca-Cola's North America Business Integration, and from 2007 until 2010 Coca-Cola's President and General Manager, Still Beverages and Supply Chain North America. Mr. Kelley originally joined Coca-Cola in 2007.

Frances G. Rathke has served as Chief Financial Officer and Treasurer of Keurig since October 2003, and as Interim Chief Financial Officer from April 2003 until October 2003.

Robert P. Ostryniec joined Keurig as Chief Product Supply Officer in August 2013. From February 2010 until August 2013, Mr. Ostryniec

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served as Senior Vice President, Global Chief Supply Chain Officer and Quality & Chief Risk Officer of H.J. Heinz Company. At H.J. Heinz Company he also served as Chief Supply Chain officer of North America from May 2005 to January 2010 and Group Vice President Consumer Products—Product Supply from July 2003 to April 2005.

Stéphane Glorieux was named President, Keurig Canada in May 2014. Mr. Glorieux previously served as Vice President, Cold Platform & International Supply Chain for the Company from 2014 until his promotion in May 2014. From 2012 until 2014, Mr. Glorieux served as Vice President, Supply Chain and Manufacturing for Keurig Canada. Prior to joining the Company, Mr. Glorieux was the Director, Customer Service and Logistics Director, Procurement, for Kraft Food France from 2008 until 2011. From 1991 until 2008, Mr. Glorieux held various management positions with Kraft Food Canada.

Linda Longo-Kazanova has served as Chief Human Resources Officer of Keurig since March 2011. Prior to joining Keurig, Ms. Kazanova was Vice President, Human Resources and Medical for the Burlington Northern Santa Fe Corporation (later acquired by Berkshire Hathaway Inc.) from May 2007 until September 2010.

Michael J. Degnan was named Chief Legal Officer, Corporate General Counsel of Keurig in March 2013 and appointed Corporate Secretary in June 2014. From January 2011 until March 2013, Mr. Degnan served as Keurig's Vice President, Associate General Counsel—Operations. Mr. Degnan also served as Vice President—General Counsel and Secretary of Keurig, Incorporated from April 2005 until December 2010.

Stephen L. Gibbs has served as Vice President and Chief Accounting Officer of Keurig since August 2011. Prior to joining the Company, Mr. Gibbs served as Vice President and Chief Accounting Officer for Scientific Games Corporation from April 2006 to August 2011 and Vice President of Finance for Scientific Games Racing from April 2005 to March 2006.

John F. Whoriskey was named President, U.S. Sales and Marketing in December 2013. From May 2013 until December 2013, Mr. Whoriskey served as President, U.S. Sales of Keurig, and from 2012 until May 2013, as Vice President and General Manager, Commercial Operations. From 2002 until 2012 Mr. Whoriskey held the position of Vice President and General Manager—At Home for Keurig.

There is no family relationship among any of the Directors or executive officers of the Company.

Corporate Information

Keurig Green Mountain, Inc. is a Delaware corporation formed in July 1993. Our corporate offices are located at 33 Coffee Lane, Waterbury, Vermont 05676. The main telephone number is (802) 244-5621, and our e-mail address for investor information is investor.services@gmcr.com. The address of our Company's website is www.KeurigGreenMountain.com.

Available information

Our Company files annual, quarterly, and current reports, proxy statements, and other documents with the Securities and Exchange Commission ("SEC") under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). The public may read and copy any materials that the Company files with the SEC at the SEC's Public Reference Room at 100 F Street, NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. Also, the SEC maintains an Internet website that contains reports, proxy and information statements, and other information regarding issuers, including Keurig, that file electronically with the SEC. The public can obtain any documents that we file with the SEC at www.sec.gov.

Our Company maintains a website at www.KeurigGreenMountain.com. Our filings with the SEC, including without limitation, our Annual Reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, are available through a link maintained on our

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website under the heading "Investor Relations—Financial Information." Our website also includes our Corporate Governance Principles, Code of Conduct and charters of the Audit and Finance, Compensation and Organizational Development, Governance and Nominating, and Sustainability committees of our Board of Directors. Information contained on our website is not incorporated by reference into this report.

Item 1A.    Risk Factors

In addition to the other information set forth in this report, you should carefully consider the following factors, which could materially affect our business, financial condition or results of operations in future periods. The risks described below are not the only risks facing our Company. Additional risks not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition or results of operations in future periods.

Our financial performance is highly dependent upon the sales of Keurig® Brewing systems and portion packs.

A significant percentage of our total revenue is attributable to sales of portion packs for use with our Keurig® Brewing systems, including earlier reservoir model appliances and our newly launched Keurig® 2.0 brewers. For the year ended September 27, 2014, total consolidated net sales of portion packs and Keurig® brewers and related accessories represented approximately 94% of consolidated net sales. Continued acceptance of Keurig® Brewing systems and sales of portion packs to an increasing installed base of brewers are significant factors in our growth plans. Any substantial or sustained decline in the sale of Keurig® Brewing systems or sales of our portion packs would materially adversely affect us. Keurig® Brewing systems compete against all sellers of coffeemakers. These companies include Bunn-O-Matic Corporation, Mars, Inc. (through its FLAVIA® unit), Conair, Inc., Hamilton Beach / Proctor-Silex, Inc., Jarden Corporation, Nestle S.A. (including the Nescafe Dolce-Gusto® beverage system), Stanley Black & Decker, Inc., Starbucks Corporation (including its Verismo® brewing system), Whirlpool Corporation, two brewing systems and brands to be merged in 2015 in joint venture under parent JAB Holding Co., (including the SENSEO® brewing system, owned by D.E. Master Blenders 1973 N.V. and the TASSIMO® brewing system, owned by Mondelez International, Inc.), as well as a number of additional brewing systems and brands. If we do not succeed in effectively differentiating ourselves from our competitors, based on technology, quality of products, desired brands or otherwise, or our competitors adopt our strategies, then our competitive position may be weakened and our sales of Keurig® Brewing systems and portion packs, and accordingly, our profitability may be materially adversely affected.

Our ongoing investment in the cold platform is risky, and could disrupt our ongoing businesses.

We have invested and expect to continue to invest significantly in our Keurig Cold™ beverage system, our cold brewing platform technology, and related infrastructure and product development. Such endeavors involve significant risks and uncertainties, including distraction of management from our existing hot platform operations, a delayed launch, insufficient revenues to offset liabilities assumed and expenses associated with the new cold platform, inadequate return of capital on our investments, not accurately predicting consumer tastes and the market opportunity for a cold platform, and unidentified issues not discovered in our due diligence and planning of such strategies and offerings. Because the introduction of and investment in a new platform is risky, no assurance can be given that the cold system will ultimately be successful and will not materially adversely affect our reputation, financial condition, and operating results.

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Continued innovation and the successful development and timely launch of new platforms, products and product extensions are critical to our financial results and achievement of our growth strategy.

Achievement of our growth strategy is dependent, among other things, on our ability to extend the product offerings of our existing brands and introduce innovative new products, including new platforms such as our cold technology. Although we devote significant focus to the development of new products, we may not be successful in developing innovative new products or our new products may not be commercially successful. Additionally, our new product introductions are often time sensitive, and thus failure to deliver innovations on schedule could be detrimental to our ability to successfully launch such new products, in addition to potentially harming our reputation and customer loyalty. Our financial results and our ability to maintain or improve our competitive position will depend on our ability to effectively gauge the direction of our key marketplaces and successfully identify, develop, manufacture, market and sell new or improved products in these changing marketplaces.

Changes in the beverage environment and retail landscape could impact our financial results.

The beverage environment is rapidly evolving as a result of, among other things, changes in consumer preferences; shifting consumer tastes and needs; changes in consumer lifestyles; and competitive product and pricing pressures. In addition, the beverage retail landscape is very dynamic and constantly evolving, not only in emerging and developing marketplaces, where modern trade is growing at a faster pace than traditional trade outlets, but also in developed marketplaces, where discounters and value stores, as well as the volume of transactions through e-commerce, are growing at a rapid pace. If we are unable to successfully adapt to the rapidly changing environment and retail landscape, our share of sales, volume growth and overall financial results could be negatively affected.

Increased competition could hurt our business.

The beverage industry is intensely competitive and we compete with respect to product, quality, convenience and price. We face significant competition in each of our channels and marketplaces. We compete with major international beverage companies that operate in multiple geographic areas, as well as numerous companies that are primarily local in operation. Our beverages also compete against local or regional brands as well as against private label brands developed by retailers. Our ability to gain or maintain share of sales in the global marketplace or in various local marketplaces may be limited as a result of actions by competitors.

Consolidation in the retail channel or the loss of key retail or grocery customers could adversely affect our financial performance.

Our industry is being affected by the trend toward consolidation in the retail channel. Larger retailers may seek lower prices from us, may demand increased marketing or promotional expenditures, and may be more likely to use their distribution networks to introduce and develop private label brands, any of which could negatively affect the Company's profitability. In addition, our success depends in part on our ability to maintain good relationships with key retail and grocery customers. The loss of one or more of our key customers could have an adverse effect on our financial performance. In addition, because of the competitive environment facing retailers, many of our customers have increasingly sought to improve their profitability through increased promotional programs, pricing concessions, more favorable trade terms and increased emphasis on private label products. To the extent we provide concessions or trade terms that are favorable to customers, our margins would be reduced. Further, if we are unable to continue to offer terms that are acceptable to our significant customers or our customers determine that they need fewer inventories to service consumers; these customers could reduce purchases of our products or may increase purchases of products from our competitors, which would harm our sales and profitability.

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Increases in the cost of high-quality Arabica coffee beans or other commodities or decreases in the availability of high quality Arabica coffee beans or other commodities could have an adverse impact on our business and financial results.

We purchase, roast, and sell high-quality whole bean Arabica coffee and related coffee products. The price of coffee is subject to significant volatility and recently the price of coffee has been increasing, and may continue to increase significantly due to factors described below. The Arabica coffee of the quality we seek tends to trade on a negotiated basis at a premium above the "C" price of coffee. This premium depends upon the supply and demand at the time of purchase and the amount of the premium can vary significantly. Increases in the "C" coffee commodity price do increase the price of high-quality Arabica coffee and also impact our ability to enter into fixed-price purchase commitments. We frequently enter into supply contracts whereby the quality, quantity, delivery period, and other negotiated terms are agreed upon, but the date, and therefore price, at which the base "C" coffee commodity price component will be fixed has not yet been established. These are known as price-to-be-fixed contracts. The supply and price of coffee we purchase can also be affected by multiple factors in the producing countries, including weather, natural disasters, crop disease (such as coffee rust), general increase in farm inputs and costs of production, inventory levels and political and economic conditions, as well as the actions of certain organizations and associations that have historically attempted to influence prices of green coffee through agreements establishing export quotas or by restricting coffee supplies. Speculative trading in coffee commodities can also influence coffee prices. Because of the significance of coffee beans to our operations, combined with our ability to only partially mitigate future price risk through purchasing practices and hedging activities, increases in the cost of high-quality Arabica coffee beans could have an adverse impact on our profitability. In addition, if we are not able to purchase sufficient quantities of green coffee due to any of the above factors or to a worldwide or regional shortage, we may not be able to fulfill the demand for our coffee, which could have an adverse impact on our profitability.

Price increases may not be sufficient to offset cost increases and maintain profitability or may result in sales volume declines.

We may be able to pass some or all raw materials, energy and other input cost increases to customers by increasing the selling prices of our products or decreasing the size of our products; however, higher product prices or decreased product sizes may also result in a reduction in sales volume and/or consumption. If we are not able to increase our selling prices or reduce product sizes sufficiently to offset increased raw material, energy or other input costs, including packaging, direct labor, overhead and employee benefits, or if our sales volume decreases significantly, there could be a negative impact on our results of operations and financial condition.

Failure to maintain profitable, strategic relationships with well-recognized brands/brand owners such as Caribou Coffee®, Dunkin' Brands, Folgers®, Newman's Own® Organics, Kraft Foods Group, Starbucks® and The Coca-Cola Company®, could adversely impact our future growth and business.

We have entered into strategic relationships for the manufacturing, distribution, and sale of portion pack products with well-regarded beverage companies such as Caribou Coffee®, Dunkin' Brands, The J.M. Smucker Company, Newman's Own® Organics, Kraft Foods Group, Starbucks® and The Coca-Cola Company®. As independent companies, our strategic partners, some of which are publicly traded companies, make their own business decisions that may not always align with our interests. In addition, many of our strategic partners have the right to manufacture or distribute their own specialty beverage products. If we are unable to provide an appropriate mix of incentives to our strategic partners through a combination of pricing and marketing and advertising support, or if our strategic partners are not satisfied with our brand innovation and development efforts, they may take actions that could adversely impact our overall future profitability and growth,

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awareness of our Keurig® Brewing systems, and our ability to attract new consumers to the Keurig® Brewing system.

If we are not able to achieve our overall long-term goals, the value of an investment in our Company could be negatively affected.

We have established and publicly announced certain long-term growth objectives, including the launch of our cold platform. These objectives were based on our evaluation of our hot platform's growth prospects, which are generally driven by volume and sales potential of many product types, some of which are more profitable than others, on an assessment of the potential price and product mix, and on the launch and ultimate adoption of our cold platform. There can be no assurance that we will achieve, for our hot platform, the required volume or revenue growth or the mix of products and, for our cold platform, a successful launch and adoption by consumers, in each case as would be necessary to achieve our long-term growth objectives.

If we are unable to expand our operations in new countries, our long-term growth rate could be negatively affected.

Our success depends in part on our ability to grow our business in new countries, which in turn depends on economic and political conditions in those countries, our ability to establish operations in those countries or to form strategic business partnerships including with established brands and to make necessary infrastructure enhancements to production facilities, distribution networks, order processing and fulfillment systems and technology. Moreover, the supply of our products in new countries marketplaces must match consumers' demand for those products. Due to product price, limited purchasing power and cultural differences, there can be no assurance that our existing products or new products currently under development will be accepted in any particular new country or that we will be able to develop new products that will be successful in any particular new country.

If we are not able to build and sustain proper information technology infrastructure or successfully implement our business transformation initiative, our business could suffer.

We depend on information technology to improve the effectiveness of our operations, to interface with our customers, to maintain financial accuracy and efficiency, to comply with regulatory financial reporting, legal and tax requirements, and for digital marketing activities and electronic communication among our locations and between our personnel and the personnel of our contract manufacturers, suppliers or other third-party partners. If we do not allocate and effectively manage the resources necessary to build and sustain the proper information technology infrastructure, we could be subject to transaction errors, processing inefficiencies, the loss of customers, business disruptions, the loss of or damage to intellectual property, or the loss of sensitive or confidential data through security breach or otherwise.

Beginning in fiscal 2013, we embarked on a multi-year business transformation initiative to streamline business processes and migrate certain of our financial processing systems to an enterprise-wide system solution. Our transition to the enterprise-wide system solution commenced in the first quarter of fiscal 2015. There can be no certainty that this initiative will deliver the expected benefits. The failure to deliver our goals may impact our ability to process transactions accurately and efficiently and remain in step with changing business needs, which could result in the loss of customers. In addition, the failure to either deliver the applications on time, or anticipate the necessary readiness and training needs, could lead to business disruption and loss of customers and revenue.

Damage to our reputation or brand name, loss of brand relevance, product recalls, product liability, sales returns and warranty expense could negatively impact us.

We believe our success depends on our ability to maintain consumer confidence in the safety and quality of our products. Our success also depends on our ability to maintain the brand image of our existing

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products, build up brand image for new products and brand extensions, and maintain our corporate reputation. We cannot assure you, however, that our commitment to product safety and quality and our continuing investment in advertising and marketing will have the desired impact on our products' brand image and on consumer preferences. Product safety or quality issues, actual or perceived, or allegations of product contamination or safety issues, even when false or unfounded, could subject us to product liability and consumer claims, tarnish the image of the affected brands and may cause consumers to choose other products. Product safety or quality issues or contamination, actual or perceived, may require us from time to time to recall a beverage, brewer or other product from all of the channels in which the affected product was distributed and result in higher than anticipated rates of warranty returns and other returns of goods. Our brand name and image could also be negatively affected by claims made against us by third parties alleging violations of law, including antitrust or competition laws. If we are unable to meet our sustainability targets, consumers may lose trust and confidence in our brand and our Company's commitment to sustainability, and our brand could be damaged. Such issues, recalls, warranty expenses and claims could negatively affect our profitability and brand image.

The loss of key personnel or difficulties recruiting and retaining our senior management team could adversely impact our business and financial results.

Much of our future success depends on the continued availability and service of our senior management. The loss of any of our executive officers or other key senior management personnel could harm our business and our ability to timely achieve our strategic initiatives, including the launch of our Keurig Cold™ beverage system. If we are unable to retain and motivate our senior management team sufficiently to maintain our current business and support our projected growth and initiatives, our business and financial performance may be adversely affected.

Failure to meet expectations for our financial performance will likely adversely affect the price and volatility of our stock.

Failure to meet expectations, particularly with respect to operating margins, earnings per share, operating cash flows, and net revenues, will likely result in a decline and/or increased volatility in the price of our stock. In addition, price and volume fluctuations in the stock market as a whole may affect the price of our stock in ways that may be unrelated to our financial performance.

Obsolete inventory may result in reduced prices or write-downs.

We must manage our inventory effectively. As we innovate and introduce new brewers to the marketplace, our existing brewers are at an increased risk of inventory obsolescence. If we ultimately determine that we have excess brewers, we may have to reduce our prices and write-down inventory which could have an adverse effect on our business, financial condition, and results of operations. Conversely, if new brewers' launches are delayed, we may have insufficient existing brewer inventory to meet our customer demand which could result in lost revenue opportunities and have an adverse impact on our financial results. Risks of inventory obsolescence also exist with our products that are subject to expiration, such as portion pack components and beverage ingredients. If we are unable to accurately forecast demand for our products, and inventory expires or becomes unusable prior to its use, our business, financial condition and results of operations could be adversely affected.

We rely on a limited number of companies for certain strategic material, product manufacturing and order fulfillment, and currently have a limited number of roasting and manufacturing facilities, so a significant disruption in the operation of any of these companies or in any of these facilities could materially adversely affect us.

We have a limited number of suppliers for certain strategic raw materials critical for the manufacture of portion packs and the processing of certain key ingredients in our portion packs. In addition, a

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single company manufactures the vast majority of our brewers. We also currently roast and manufacture our coffee and other beverage products in facilities in the United States (in Vermont, Tennessee, Washington, Virginia, and California) and one facility in Canada. Any disruption in operation of these companies or facilities, whether as a result of a natural disaster, contractual dispute or other causes, could significantly impair our ability to meet demand for our products and adversely affect our business, financial condition and results of operations. Moreover, if demand increases more than we currently forecast, we will need to either expand our current capabilities internally or acquire additional capacity and the failure to do so in a timely or cost effective manner could have a negative impact on our business.

In addition, we rely primarily on one order fulfillment entity, M.Block & Sons, Inc. ("MBlock"), to process the majority of orders sold through to retailers, department stores and mass merchants in the United States. See Note 2, Significant Accounting Policies for the Company's revenue recognition policy on how we recognize revenue on orders processed through fulfillment entities. The inability of MBlock to perform its obligations to us, whether due to deterioration in its financial condition, integrity or failure of its business systems or otherwise, could result in significant losses that could materially adversely affect us. If our relationship with MBlock is terminated, we can provide no assurance that we would be able to contract with another third-party to provide these services to us in a timely manner or on favorable terms or that we would be able to internalize the related services effectively or in a timely manner.

Our long-term purchase commitments for certain strategic raw materials critical for the manufacture of portion packs could impair our ability to be flexible in our business without penalty.

In order to ensure a continuous supply of high quality raw materials some of our inventory purchase obligations include long-term purchase commitments for certain strategic raw materials critical for the manufacture of portion packs. The timing of these may not always coincide with the period in which we need the supplies to fulfill customer demand. This could lead to higher and more variable inventory levels and/or higher raw material costs.

We rely on independent certification for a number of our products. Loss of certification within our supply chain or as related to our manufacturing processes could harm our business.

We rely on independent certification, such as certifications of our products as "organic" or "Fair Trade," to differentiate some of our products from others, such as the Newman's Own® Organics product line, Green Mountain Coffee® Fair Trade Certified™ coffee line and the Canada segment's Fair Trade Organic Collection. In fiscal 2014, approximately 23% of our coffee purchases were from certified sources. We must comply with the requirements of independent organizations or certification authorities in order to label our products as certified. The loss of any independent certifications could adversely affect our marketplace position, which could harm our business.

Due to the seasonality of many of our products and other factors such as adverse weather conditions, our operating results are subject to fluctuations.

Historically, we have experienced increased sales of our Keurig® Brewing systems in our first fiscal quarter due to the holiday season. Because of the seasonality of our business, results for any quarter are not necessarily indicative of the results that maybe achieved for the full fiscal year. The impact on sales volume and operating results due to the timing and extent of these factors can significantly impact our business. For these reasons, quarterly operating results should not be relied upon as indications of our future performance.

The sales of our products are influenced to some extent by weather conditions in the geographies in which we operate. Unusually warm weather during the winter months may have a temporary decrease on the demand for some of our products and contribute to lower sales, which could have an adverse effect on our results of operations for such periods.

19

Our failure to accurately forecast customer demand for our products, or to quickly adjust to forecast changes, could adversely affect our business and financial results.

There is inherent risk in forecasting demand due to the uncertainties involved in assessing the current level of maturity of the single-serve component of our business. We set target levels for the manufacture of brewers and portion packs and for the purchase of green coffee in advance of customer orders based upon our forecasts of customer demand.

If our forecasts exceed demand, we could experience excess inventory in the short-term, excess manufacturing capacity in the short and long-term, and/or price decreases, all of which could impact our financial performance. Alternatively, if demand exceeds our forecasts significantly beyond our current manufacturing capacity, we may not be able to satisfy customer demand, which could result in a loss of share if our competitors are able to meet customer demands. A failure to accurately predict the level of demand for our products could adversely affect our net revenues and net income.

Increases or changes in income or indirect tax rates could have a material adverse impact on our financial results.

As a multinational corporation, we are subject to income taxes as well as non-income based taxes, in both the United States and various foreign jurisdictions.

Our tax filings for various periods in the jurisdictions in which we do business may be subjected to audit by the relevant tax authorities. These audits may result in assessments of additional taxes, including interest and penalties, which are subsequently resolved with the authorities or potentially through the courts.

Increases in income tax rates could reduce our after-tax income from affected jurisdictions. Other changes in tax laws, regulations, related interpretations, and tax accounting standards in the U.S. and various foreign jurisdictions in which we operate may adversely affect our financial results. For example, the United States, many countries in the European Union, and other foreign jurisdictions where we do business, are actively considering changes in relevant tax, accounting and other laws, regulations and interpretations, including changes to tax laws applicable to corporate multinationals, which, if enacted, could have a significant adverse impact on our effective tax rate.

Exposure to foreign currency risk and related hedging activities may result in significant losses and fluctuations to our periodic income statements.

Our foreign operations are primarily related to our Canada segment, which is subject to risks, including, but not limited to, unique economic conditions, changes in political climate, differing tax structures, other regulations and restrictions, and foreign exchange rate volatility. Accordingly, our future results could be materially adversely affected by changes in these or other factors. We also source our green coffee, certain production equipment, and components of our brewers and manufacturing of our brewers from countries outside the United States, which are subject to the same risks described for Canada above.

The majority of the transactions conducted by our Canada segment are in the Canadian dollar. As a result, our revenues are adversely affected when the United States dollar strengthens against the Canadian dollar and are positively affected when the United States dollar weakens. Conversely, our Canadian dollar-denominated expenses decrease when the United States dollar strengthens against the Canadian dollar and increase when the United States dollar weakens. Additionally, our assets and liabilities denominated in Canadian dollars are similarly affected when the United States dollar fluctuates against the Canadian dollar. From time to time we engage in transactions involving various derivative instruments to mitigate our foreign currency rate exposures. More specifically, we hedge, on a net basis, the foreign currency exposure of a portion of our assets and liabilities that are denominated in Canadian dollars. As we expand geographically, we expect to have increasing foreign currency risk associated with cash flows from foreign subsidiaries, foreign currency purchase commitments, and foreign currency intercompany debt. There can be no assurance, however, that

20

these contracts will effectively protect us from fluctuations in foreign currency exchange rates, and we may incur material losses from such hedging transactions.

If we are unable to protect our information systems against service interruption or failure, misappropriation of data or breaches of security, our operations could be disrupted, we could be subject to costly government enforcement actions and private litigation and our reputation may be damaged.

Our businesses involve the collection, storage and transmission of users' personal information. Our efforts to protect such information may be unsuccessful due to the actions of third parties, computer viruses, physical or electronic break-ins, catastrophic events, employee error or malfeasance or other attempts to harm our systems. Because the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems, change frequently and often are not recognized until launched against a target, we may be unable to anticipate these techniques or to implement adequate preventative measures in time. We could also experience a loss of critical data and delays or interruptions in our ability to manage inventories or process transactions. Some of our commercial partners, such as those that help us deliver our website, may receive or store information provided by us or our users through our websites. If these third parties fail to adopt or adhere to adequate information security practices, or fail to comply with our online policies, or in the event of a breach of their networks, our users' data may be improperly accessed, used or disclosed.

If our systems are harmed or fail to function properly, we may need to expend significant financial resources to repair or replace systems or to otherwise protect against security breaches or to address problems caused by breaches. If we experience a significant security breach or fail to detect and appropriately respond to a significant security breach, we could be exposed to costly legal or regulatory actions against us in connection with such incidents, which could result in orders or consent decrees forcing us to modify our business practices. Any incidents involving unauthorized access to or improper use of user information, or incidents that are a violation of our online privacy policy could harm our brand reputation and diminish our competitive position. Any of these events could have a material and adverse effect on our business, reputation or financial results. Our insurance policies carry coverage limits, which may not be adequate to reimburse us for losses caused by security breaches.

Our intellectual property may not be valid, enforceable, or commercially valuable.

While we make efforts to develop and protect our intellectual property, the validity, enforceability and commercial value of our intellectual property rights may be reduced or eliminated by the discovery of prior inventions by third-parties, the discovery of similar marks previously used by third-parties, the successful independent development by third-parties of the same or similar confidential or proprietary innovations or changes in the supply or distribution chains that render our rights obsolete.

We rely on trademark, trade secret, patent and copyright laws to protect our intellectual property rights. We cannot be sure that these intellectual property rights will be maximized or that they can be successfully asserted. There is a risk that we will not be able to obtain and perfect our own or, where appropriate, license intellectual property rights necessary to support new product introductions. We cannot be sure that these rights, if obtained, will not be invalidated, circumvented or challenged in the future. In addition, even if such rights are obtained in the United States, the laws of some of the other countries in which our products are or may be sold do not protect our intellectual property rights to the same extent as the laws of the United States. Our failure to perfect or successfully assert our intellectual property rights could make us less competitive and could have an adverse effect on our business, operating results and financial condition.

21

Litigation pending against us could materially impact our business and results of operations.

We are currently party to various legal and other proceedings. In particular, numerous putative class actions and stockholder derivative actions have been filed against us in response to our disclosures in the Current Reports on Forms 8-K dated September 28, 2010 and November 15, 2010. In addition, two individual and numerous class actions have been filed against us asserting claims under United States federal antitrust laws and various state laws, claiming that the Company has monopolized alleged markets for single serve coffee brewers and single serve coffee portion packs, including through its contracts with suppliers and distributors and in connection with the launch of our next generation hot brewing system, Keurig® 2.0 and seeking to block the launch of Keurig® 2.0. A claim was also filed against us in Canada by Club Coffee L.P., a Canadian manufacturer of single-serve beverage packs, claiming damages of $600 million and asserting a breach of competition law and false and misleading statements by the Company. We have also been sued in California state court, for an alleged violation of California's Proposition 65 law in connection with the presence of acrylamide in coffee. See Note 19, Commitments and Contingencies, of the Notes to Consolidated Financial Statements included within Part II of this Annual Report on Form 10-K. These matters may involve substantial expense and operational disruption to us, which could have a material adverse impact on our financial position and our results of operations. These matters may also lead to reputational harm. We can provide no assurances as to the outcome of any litigation.

Laws and regulations could adversely affect our business.

Our products are extensively regulated in every jurisdiction in which we operate and, as we continue to expand geographically, will become subject to the laws and regulations of additional jurisdictions. Our products are subject to numerous food safety and other laws and regulations relating to the sourcing, manufacturing, storing, marketing, advertising, and distributing of these products. Other laws and regulations relate to labeling requirements, the environment, relations with distributors and retailers, employment, privacy, health and safety and trade practices. Enforcement of existing laws and regulations, changes in legal requirements, and/or evolving interpretations of existing regulatory requirements, may result in increased compliance costs and create other obligations, financial or otherwise, that could adversely affect our business, financial condition or operating results.

Significant additional labeling or warning requirements or limitations on the availability of our products may inhibit sales of affected products.

Various jurisdictions may seek to adopt significant additional product labeling or warning requirements or limitations on the availability of our products relating to the content or perceived adverse health consequences of certain of our products. If these types of requirements become applicable to one or more of our major products under current or future environmental or health laws or regulations, they may inhibit sales of such products. One such law, which is in effect in California and is known as Proposition 65, requires that a warning appear on any product sold in California that contains a substance that, in the view of the state, causes cancer or birth defects. The state maintains lists of these substances and periodically adds other substances to these lists. Proposition 65 exposes all food and beverage producers to the possibility of having to provide warnings on their products in California because it does not provide for any generally applicable quantitative threshold below which the presence of a listed substance is exempt from the warning requirement. Consequently, the detection of even a trace amount of a listed substance can subject an affected product to the requirement of a warning label. However, Proposition 65 does not require a warning if the manufacturer of a product can demonstrate that the use of the product in question exposes consumers to a daily quantity of a listed substance that is below a "safe harbor" threshold that may be established, is naturally occurring, is the result of necessary cooking, or is subject to another applicable exception. One or more substances that are currently on the Proposition 65 lists, or that may be added to the lists in the future, can be detected in Company products,

22

including coffee, at low levels that are safe. With respect to substances that have not yet been listed under Proposition 65, the Company takes the position that listing is not scientifically justified. With respect to substances that are already listed, the Company takes the position that the presence of each such substance in Company products is subject to an applicable exemption from the warning requirement. The State of California or other parties, however, may take a contrary position. If we were required to add Proposition 65 warnings on the labels of one or more of our beverage products produced for sale in California, the resulting consumer reaction to the warnings and possible adverse publicity could negatively affect our sales both in California and in other marketplaces.

Adverse changes in global and domestic economic conditions or a worsening of the United States economy could materially adversely affect us.

For the year ended September 27, 2014, our net sales in the United States were approximately $4.1 billion, or 87% of our total net sales. Our sales and performance depend significantly on consumer confidence and discretionary spending, which are under pressure from United States and global economic conditions. Unfavorable general economic conditions, such as a worsening of economic conditions and/or decrease in consumer spending in the United States may adversely impact our sales, reduce our profitability and could negatively affect our overall financial performance. We also have exposure to various financial institutions under coffee hedging arrangements and interest rate swaps, and the risk of counterparty default.

Climate change may have a long-term adverse impact on our business and results of operations.

There is increasing concern that a gradual increase in global average temperatures due to increased concentration of carbon dioxide and other greenhouse gases in the atmosphere will cause significant changes in weather patterns around the globe and an increase in the frequency and severity of natural disasters. Decreased agricultural productivity in certain regions of the world as a result of changing weather patterns may limit availability or increase the cost of key agricultural commodities, such as coffee and tea, which are important sources of ingredients for our products, and could impact the food security of communities around the world. Increased frequency or duration of extreme weather conditions could also impair production capabilities, disrupt our supply chain or impact demand for our products. As a result, the effects of climate change could have a long-term adverse impact on our business and results of operations.

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Item 1B.    Unresolved Staff Comments

None.

Item 2.    Properties

Our significant facilities are as follows:

Business Segment	Purpose	Location	Approximate Square Feet		Owned or Leased		Expiration of Lease (fiscal year)
Domestic	Warehouse and Distribution	California		62,000		Leased		2016
Domestic	Warehouse and Distribution	New Jersey		344,000		Leased		2017
Domestic	Warehouse and Distribution	Vermont		72,000		Owned		—
Domestic	Warehouse and Distribution	Washington		224,000		Leased		2015 - 2017
Domestic	Manufacturing	California		55,000		Leased		2015
Domestic	Manufacturing	Georgia		585,000		Owned		—
Domestic	Manufacturing	Tennessee		334,000		Owned		—
Domestic	Manufacturing	Vermont		806,000		Leased		2016 - 2026
Domestic	Manufacturing	Vermont		123,000		Owned		—
Domestic	Manufacturing	Virginia		330,000		Owned		—
Domestic	Manufacturing	Washington		198,000		Leased		2017
Domestic	Research and Development	Massachusetts		151,000		Leased		2030
Domestic	Research and Development	Shenzhen, China		7,000		Leased		2015
Domestic	Research and Development	Vermont		55,000		Owned		—
Domestic	Administrative	Massachusetts		369,000		Leased		2015 - 2030
Domestic	Administrative	Vermont		73,000		Leased		2015 - 2018
Domestic	Administrative	Vermont		72,000		Owned		—
Canada	Warehouse and Distribution	Alberta		58,000		Leased		2015 - 2020
Canada	Warehouse and Distribution	British Columbia		53,000		Leased		2015 - 2017
Canada	Warehouse and Distribution	Ontario		55,000		Leased		2015 - 2017
Canada	Warehouse and Distribution	Quebec		139,000		Owned		—
Canada	Warehouse and Distribution	Quebec		82,000		Leased		2015 - 2023
Canada	Warehouse and Distribution	Saskatchewan		20,000		Leased		2015 - 2018
Canada	Manufacturing	Quebec		59,000		Leased		2020
Canada	Manufacturing	Quebec		80,000		Owned		—
Canada	Administrative	Alberta		24,000		Leased		2015 - 2020
Canada	Administrative	British Columbia		7,000		Leased		2015 - 2019
Canada	Administrative	Ontario		31,000		Leased		2015 - 2022
Canada	Administrative	Quebec		22,000		Leased		2015 - 2023
Canada	Administrative	Quebec		98,000		Owned		—
Corporate	Administrative	Vermont		153,000		Leased		2018 - 2021

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In addition to the locations listed above, the Company has inventory at various locations managed by third-party warehouses and order fulfillment entities.

We have consolidated all of our Canadian coffee and portion pack production in Montreal, Quebec and have discontinued production in Toronto, Ontario.

Item 3.    Legal Proceedings

For information regarding legal proceedings in which we are involved, see Note 19, Commitments and Contingencies, to the Consolidated

Financial Statements included in Item 8 of Part II of this Annual Report on form 10-K.

Item 4.    Mine Safety Disclosures

Not applicable.

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PART II

Item 5.    Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Price Range of Securities

The Company's common stock trades on the NASDAQ Global Select Market under the symbol GMCR. The following table sets forth the high and low closing prices as reported by NASDAQ and the quarterly cash dividend declared per share of our common stock for the periods indicated:

		High		Low		Dividend declared per share
Fiscal 2013	13 weeks ended December 29, 2012	$	42.59	$	22.00	$	—
	13 weeks ended March 30, 2013	$	56.76	$	39.25	$	—
	13 weeks ended June 29, 2013	$	81.78	$	53.23	$	—
	13 weeks ended September 28, 2013	$	88.78	$	68.88	$	—
Fiscal 2014	13 weeks ended December 28, 2013	$	77.25	$	58.18	$	0.25
	13 weeks ended March 29, 2014	$	123.74	$	74.63	$	0.25
	13 weeks ended June 28, 2014	$	126.09	$	90.61	$	0.25
	13 weeks ended September 27, 2014	$	137.48	$	113.20	$	0.25

Number of Equity Security Holders

As of November 14, 2014, the number of record holders of the Company's common stock was 390.

Dividends

While we paid dividends to the holders of our common stock on a quarterly basis in fiscal 2014, decisions to declare and pay future cash dividends are at the discretion of the Board of Directors and are dependent on several factors, including our operating performance, financial condition, capital expenditure requirements and other measures deemed relevant by the Board of Directors.

Securities Authorized for Issuance Under Equity Compensation Plans

Plan category	Number of securities to be issued upon exercise of outstanding options, warrants and rights		Weighted average exercise price of outstanding options, warrants and rights			Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))(4)
	(a)		(b)			(c)
Equity compensation plans approved by security holders(1)		4,064,020	$	25.27	(3)		9,828,746
Equity compensation plans not approved by security holders(2)		39,251	$	23.15			—
Total		4,103,271	$	25.25			9,828,746

⁽¹⁾

Includes the 1999 Stock Option Plan, the 2000 Stock Option Plan, the 2006 Incentive Plan, the 2002 Deferred Compensation Plan, the 2014 Amended and Restated Employee Stock Purchase Plan and the 2014 Omnibus Plan. See Note 15, Employee Compensation Plans, of the Consolidated Financial Statements included in this Annual Report.

⁽²⁾

Includes 2005 compensation plan assumed in the 2006 acquisition of Keurig, Incorporated and inducement grants to Gérard Geoffrion and Linda Longo-Kazanova. See Note 15, Employee Compensation Plans, of the Consolidated Financial Statements included in this Annual Report.

⁽³⁾

Restricted stock units and performance stock units are not included in the weighted average exercise price. These grant types do not have an exercise price.

⁽⁴⁾

Includes the 2014 Amended and Restated Employee Stock Purchase Plan, 2002 Deferred Compensation Plan and the 2014 Omnibus Plan. For the portion covering the 2014 Omnibus Plan (7,298,292 securities) (the "Fungible Pool Limit"), each share of common stock issued or to be issued in connection with any award that is not a stock option or stock appreciation right shall be counted against the Fungible Pool Limit as 1.704 Fungible Pool Units. Stock options and stock appreciation rights are counted against the Fungible Pool Limit as 1.0 Fungible Pool Unit.

26

Issuer Purchases of Securities

Period(1)	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plan(2)		Maximum Remaining Amount Available Under the Plan (in thousands)
June 29, 2014 to July 26, 2014		149,177	$	119.58		149,177	$	1,220,027
July 27, 2014 to August 23, 2014		60,339	$	119.84		60,339	$	1,212,796
August 24, 2014 to September 27, 2014		230,000	$	130.32		230,000	$	1,182,821
Total		439,516	$	125.24		439,516

⁽¹⁾

Monthly information corresponds to our fiscal months during the fourth quarter of fiscal 2014.

⁽²⁾

All shares purchased during the period were made as part of plans approved by the Board of Directors in November 2013, to purchase up to $1.0 billion in Company shares, and in May 2014 to purchase up to an additional $1.0 billion in Company shares.

See Note 14, Stockholders' Equity, of the Notes to Consolidated Financial Statements included in this Annual Report.

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Performance Graph

Due to the inclusion of the Company in Standard & Poor's 500 Index in fiscal 2014, the following graph depicts the total return to shareholders from September 26, 2009 through September 27, 2014, relative to the performance of the Standard & Poor's 500 Index, the NASDAQ Composite Index, Standard & Poor's 500 Packaged Foods and Meats sector and Standard & Poor's 600 Packaged Foods and Meats Sector peer groups that include the Company. All indices shown in the graph and table below assume an investment of $100 on September 26, 2009 and the reinvestment of dividends paid since that date. The stock price performance shown in the graph is not necessarily indicative of future price performance.

5 Year Cumulative Total Return

	9/26/2009		9/25/2010		9/24/2011		9/29/2012		9/28/2013		9/27/2014
Keurig Green Mountain, Inc.	$	100.00	$	157.64	$	453.76	$	103.32	$	325.90	$	572.77
NASDAQ Composite	$	100.00	$	112.55	$	116.28	$	153.12	$	189.49	$	227.09
S&P 500 Index	$	100.00	$	110.16	$	111.42	$	145.07	$	173.13	$	207.30
S&P 500 Packaged Foods and Meats	$	100.00	$	118.48	$	134.28	$	158.22	$	193.87	$	219.12
S&P 600 Packaged Foods & Meats	$	100.00	$	113.53	$	151.00	$	149.60	$	186.50	$	219.06

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Item 6.    Selected Financial Data

The following data should be read in conjunction with Management's Discussion and Analysis of Financial Condition and Results of Operations and the consolidated financial statements of the Company, including the notes thereto, in Items 7 and 8, respectively, of this Annual Report in order to fully understand factors that may affect the comparability of the financial data. The following selected Consolidated Balance Sheet data as of September 27, 2014, and September 28, 2013 and selected Consolidated Statements of Operations for the fiscal years ended September 27, 2014, September 28, 2013 and September 29, 2012 are derived from our audited financial statements included in Item 8 of this Annual Report. The historical results do not necessarily indicate results expected for any future period.

Our fiscal year ends on the last Saturday in September. Fiscal years 2014, 2013, 2011 and 2010 consist of 52 weeks. Fiscal 2012 consists of 53 weeks.

	Fiscal Years Ended
	September 27, 2014			September 28, 2013		September 29, 2012(4)		September 24, 2011(2)			September 25, 2010(1)
	In thousands, except per share data
Net sales	$	4,707,680		$	4,358,100	$	3,859,198	$	2,650,899		$	1,356,775
Net income attributable to Keurig	$	596,518		$	483,232	$	362,628	$	199,501		$	79,506
Net income per share-diluted	$	3.74		$	3.16	$	2.28	$	1.31		$	0.58
Total assets	$	4,797,307		$	3,761,548	$	3,615,789	$	3,197,887		$	1,370,574
Long-term debt, less current portion	$	140,937		$	160,221	$	466,984	$	575,969		$	335,504
Total stockholders' equity	$	3,458,681	(5)	$	2,635,570	$	2,261,228	$	1,912,215	(3)	$	699,245
Cash dividends declared per common share	$	1.00		$	—	$	—	$	—		$	—

⁽¹⁾

Fiscal 2010 information presented reflects the acquisition of Timothy's Coffee of the World Inc. on November 13, 2009 and the acquisition of Diedrich Coffee, Inc. on May 11, 2010.

⁽²⁾

Fiscal 2011 information presented reflects the acquisition of LJVH Holdings, Inc. and Subsidiaries ("Van Houtte") on December 17, 2010.

⁽³⁾

Fiscal 2011 stockholders' equity balance reflects the impact of the May 11, 2011 equity offering and concurrent private placement and the September 28, 2010 sale of common stock to Luigi Lavazza S.p.A. ("Lavazza").

⁽⁴⁾

Fiscal 2012 information presented reflects the sale of Van Houtte USA Holdings, Inc., also known as the Van Houtte U.S. Coffee Service business or the "Filterfresh" business, on October 3, 2011.

⁽⁵⁾

Fiscal 2014 stockholders' equity balance reflects the impact of the February 27, 2014 sale of common stock to Atlantic Industries, an indirect wholly owned subsidiary of The Coca-Cola Company, and the March 28, 2014 sale of common stock to Lavazza.

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Item 7.    Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis is intended to help you understand the results of operations and financial condition of Keurig Green Mountain, Inc. (together with its subsidiaries, the "Company", "Keurig", "we", "our", or "us"). You should read the following discussion and analysis in conjunction with our consolidated financial statements and related notes included elsewhere in this report.

Overview

We believe that we are a leader in specialty coffee, coffeemakers, teas and other beverages in the United States and Canada. We consider ourselves an innovative, technology-driven, values-based personal beverage system company. Our multi-brand beverage and brewer portfolio is aimed at changing the way consumers prepare and enjoy coffee and other beverages both at home and away from home. We develop and sell a variety of Keurig® brewers and produce and sell specialty coffee and other specialty beverages in portion packs including hot apple cider, hot and iced teas, iced coffees, iced fruit brews, hot cocoa and other beverages for use with our Keurig® hot brewing systems. We also offer traditional whole bean and ground coffee in other package types including bags, fractional packages and cans.

Products

Portion Packs

We offer portion packs of varying sizes including single-serve K-Cup®, Vue® and Rivo® packs as well as multi-serve K-Carafe™ packs capable of producing a three to four cup carafe and Bolt™ packs capable of producing a 64 ounce carafe. We offer high-quality Arabica bean coffee including single-origin, Fair Trade Certified™, Rain Forest Alliance Certified™, organic, flavored, limited edition and proprietary blends. We also procure Robusta bean coffee for use in certain blends. We carefully select our coffee beans and appropriately roast the coffees to optimize their taste and flavor differences. We manufacture and sell portion packs of our own brands and participating brands through licensing and manufacturing agreements. We offer brand choice such as Caribou Coffee®, Dunkin' Donuts™, Eight O'Clock®, Emeril's®, Folgers®, Folgers Gourmet Selections®, Gloria Jean's®, Kirkland Signature™, Krispy Kreme®, Lavazza®, Millstone®, Newman's Own® Organics Peet's Coffee & Tea, and Starbucks®. The Company has licensing agreements for tea with Unilever North America (Lipton®), Celestial Seasonings, Inc. (Celestial Seasonings® branded teas and Perfect Iced Tea®), Good Earth® Corporation and Tetley® USA, Inc. (Good Earth® and Tetley® branded teas), R. C. Bigelow, Inc. (Bigelow® branded teas), Snapple Beverage Corp. (Snapple® branded teas), Starbucks Corporation (Tazo® and Teavana®) and Associated British Foods plc (Twinings of London®) for manufacturing, distribution, and sale of portion packs. In addition to coffee and tea, we also produce and sell portion packs for lemonade and hot apple cider under our Green Mountain Naturals™ brand, iced fruit brews under our Vitamin Burst™ brand, cocoa and other dairy-based beverages under our Café Escapes™ brand, and cocoa under the Swiss Miss® brand.

Brewers and Accessories

We are a leader in sales of coffeemakers in the U.S. and Canada. As of the end of our 2014 fiscal year, we had the top four best-selling at-home coffeemakers by dollar volume in the United States according to the NPD Group for consumer market research data in the United States. Under the Keurig® K-Cup®, Keurig® Vue®, Keurig Bolt™, Keurig® 2.0 and co-branded Keurig® Rivo® brand names, we offer a variety of commercial and home use brewers for the away from home ("AFH") and at home ("AH") channels differentiated by features and size.

In addition, we have license agreements under which licensees manufacture, market and sell coffeemakers co-branded with "Keurig® Brewed". Licensees include Breville PTY Limited selling a "Breville®" branded brewer; Jarden Consumer Solutions selling a "Mr. Coffee®"

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branded brewer and Conair Corporation selling a "Cuisinart®" branded brewer.

We offer a variety of accessories for the Keurig® Brewing platforms including K-Cup®, Vue®, Rivo®, K-Carafe™, and Bolt™ pack storage racks, baskets, and brewer carrying cases. We also sell other coffee-related equipment and accessories, gift assortments, hand-crafted items from coffee-source countries and gourmet food items covering a wide range of price points.

Other Products and Royalties

We sell coffee in other package types in addition to portion packs such as bagged coffee and cans (for the grocery and mass channels) and fractional packages and ancillary products (for the office coffee and food service channels). We also earn royalties from licensees under various licensing agreements.

In recent years, growth in the coffee industry has come from the specialty coffee category fueled by the emergence of specialty coffee shops throughout the U.S. and Canada. Single-serve has been the fastest growing segment of the specialty coffee category. Concurrently, consumers are more frequently seeking to enjoy premium experiences within the comfort and convenience of their own homes, including the consumption of specialty coffee. In addition to what we believe to be our carefully developed and distinctive advantages over our competitors, including quality, convenience and choice, the Company has been benefiting from these broad consumer trends.

Our growth strategy involves using our consumer insights to develop innovative new brewing systems and beverages; continually improving and refining our current systems and beverages; and, developing and managing marketing programs to drive Keurig® Brewing system adoption in order to generate ongoing demand for portion packs. We currently target opportunities primarily in American and Canadian households, foodservice, educational and office locations. Over the longer term, we also will work to expand our addressable opportunity globally. As part of our strategy, we work to sell our at-home hot system brewers at attractive price points which are approximately at cost, or at a loss when factoring in the incremental costs related to sales, in order to drive the sales of profitable portion packs. As we introduce new innovative beverage systems such as the Keurig® 2.0 Beverage System or Keurig Cold™ beverage system, we expect to experience higher appliance costs as we scale the related manufacturing processes followed by lower appliance cost structures as the supply chain creates more efficient manufacturing processes. During the early years of the launch of these innovative new beverage systems, we will continue to sell the at-home appliances at attractive price points which we expect will result in selling these new innovative at-home appliances at a loss prior to factoring in the incremental costs related to these sales.

In addition, we have license agreements with Breville PTY Limited (producer of Breville® brand coffeemakers), Jarden Consumer Solutions (producer of Mr. Coffee® brand coffeemakers) and Conair Corporation (producer of Cuisinart® brand coffeemakers), under which each produce, market and sell coffeemakers co-branded with Keurig®.

In recent years, our growth has been driven predominantly by an increase in adoption of Keurig® hot brewing systems, which include both the brewer and the related portion packs. In fiscal 2014, approximately 94% of our consolidated net sales were attributed to the combination of portion packs and Keurig® brewers and related accessories.

We believe the primary consumer benefits delivered by our Keurig® Brewing system are as follows:

1

Quality—expectations of the quality of coffee consumers drink has increased over the last several years and, we believe, with the Keurig® system, consumers can be certain they will get a high-quality, consistently produced beverage every time.



2

Convenience—the Keurig® system prepares beverages generally in less than a minute at the touch of a button with no mess, no fuss.

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3

Choice—with many beverage brands across multiple beverage categories, Keurig offers more than 385 individual varieties, allowing consumers to enjoy and explore a wide range of beverages. In addition to a variety of brands of coffee and tea, we also produce and sell iced teas, iced coffees, hot and iced fruit brews, hot cocoa and other dairy-based beverages, in portion packs.

We see these benefits as being our competitive advantage and believe it's the combination of these attributes that make Keurig® Brewing systems appealing to consumers.

We are focused on building our brands, diversifying our product lines and profitably growing our business. We believe we can continue to grow sales by increasing consumer awareness of the Keurig® brand in the United States and Canada; expanding into new geographic regions; expanding consumer choice of coffee, tea and other beverages in our existing brewing systems; developing and introducing new brewing platforms; expanding sales in adjacent beverage industry segments; and/or selectively pursuing other synergistic opportunities.

The key elements of our business strategy are as follows:

•

Increasing adoption of the Keurig® hot brewing systems in the United States and Canada;

•

Expanding beverage choice through both our owned and partner brand offerings;

•

Expanding in current channels;

•

Launching new, innovative beverage system technologies and platforms; and,

•

Continuing international expansion.

Increasing adoption of the Keurig® hot brewing systems in the United States and Canada. While we are positioned as a leader in the hot beverage marketplace, we have opportunities in the United States and Canada to increase brand awareness and household penetration. In our fiscal year 2014 we launched our Keurig® 2.0 Beverage System—the first Keurig® brewer to brew both a single cup and a carafe. Extending the Keurig® value proposition to include a carafe option for at-home users allows us to target an incremental need of consumers for brewing larger volumes quickly and simply. We are also implementing measures to improve the shopping experience at retail to further distinguish the Keurig® brand and enhance brand recognition. Additionally, we are launching targeted marketing campaigns to increase regional household penetration in certain geographic areas through increased awareness, trial and conversion. As we continue to introduce the new Keurig® 2.0 Beverage System in fiscal 2015, we anticipate that we will continue to incur transition costs through the first year of launch including higher brewer costs for the new 2.0 appliances as compared to the earlier reservoir model appliances leading to lower gross margins.

Expanding beverage choice through both our owned and partner brand offerings.    In fiscal 2014, we continued expanding consumer choice in the Keurig® Brewing system by entering into or extending a number of business relationships across multiple channels and geographies for use with Keurig® brewers. Expanded or new brand partnerships announced in fiscal year 2014 included Krispy Kreme®, Lavazza, Laura Second®, Peet's Coffee & Tea, Folgers®, Folgers Gourmet Selections®, Café Bustelo®, Millstone®, Seattle's Best Coffee®, Nestle® Coffee-mate®, Maxwell House®, Gevalia®, Yuban®, McCafé® and Honest Tea®. In addition, we also signed agreements to produce store brands for stores including BJ's Wholesale Club, Harris Teeter, Target and W.B. Mason. These are in addition to our existing relationship to produce Costco Wholesale Corporation's Kirkland Signature™ brand. We believe these new brand and product offerings fuel excitement for current Keurig® brewer owners and users; raise system awareness; attract new consumers to the system; and promote expanded use of the Keurig® Brewing system. These relationships are established with careful consideration of potential economics. We expect to continue to enter into these mutually beneficial relationships in our efforts to expand choice and diversify our portfolio of brands with the expectation that they will lead to increased Keurig®

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Brewing system awareness and household adoption, in part through the participating brands' advertising and merchandising activities.

Expanding in current channels.    We have identified and are targeting specific opportunities within our existing channels, specifically the AFH channel, including food service, workplace, higher education and hospitality locations. These are areas where we have substantial room to grow, considering we are currently in less than one percent of food service outlets. We began addressing this opportunity by forming a partnership with the SUBWAY® restaurant chain to bring Keurig® brewers to many of the restaurant brand's North American locations.

Launching new, innovative beverage system technologies and platforms.    We are also focused on continued innovation in both hot and cold beverage systems. Some of our recent initiatives and planned product introductions include:

•

An expansion of the Keurig® hot beverage brewing system with the introduction of Keurig® Bolt™, a new commercial grade batch brewing platform which became available in spring of 2014;

•

The introduction of Keurig® 2.0, our next generation at-home hot beverage system. Keurig® 2.0 is the first Keurig® brewer to brew both a single cup and up to a four-cup carafe from a Keurig® brand pack providing Keurig® consumers with even greater beverage choice with the same Keurig simplicity and convenience they expect from Keurig. Keurig® 2.0 is also the first Keurig® brewer to feature Keurig® 2.0 Brewing Technology™, which enables the brewer to recognize the inserted Keurig® pack and optimize to the recommended, customized setting for that particular beverage. The Keurig® 2.0 Brewing Technology™ ensures that the Keurig® 2.0 system delivers on the promise of excellent quality beverages, produced simply and consistently, every single time;

•

An estimated launch of the Keurig Cold™ beverage system in fiscal 2015. Keurig Cold™ will deliver freshly prepared cold carbonated, sparkling and still beverages. During fiscal 2014, we announced the first significant partnership related to the Keurig Cold™ beverage system: a ten-year agreement to collaborate on the development and introduction of The Coca-Cola Company's® global brand portfolio for use in the Keurig Cold™ at-home beverage system. Under the global strategic agreement, Keurig and The Coca-Cola Company will cooperate to bring the Keurig Cold™ beverage system to consumers around the world.

Continuing international expansion.    Continuing into fiscal 2015, we are planning to launch our Keurig® hot system global platform in targeted countries outside of North America. In fiscal 2014, we launched a Keurig® brewer in the away from home channel in the United Kingdom.

Our business relationships with participating brands are generally established through licensing or manufacturing arrangements.

Under licensing arrangements, we license the right to manufacture, distribute and sell the finished products through our distribution channels using the brand owners' marks. For the right to use a brand owner's mark, we pay a royalty to the brand owner based on our sales of finished products that contain the brand owner's mark.

Under manufacturing arrangements, we manufacture finished beverage products using raw materials sourced by us or provided by the brand owner. In both instances, once the manufacturing process is complete, we sell the finished product either to the brand owner or to our customers. Under certain manufacturing arrangements, our sole customer is the brand owner and we are prohibited from selling the beverage products to other types of customers through our distribution channels. Under other manufacturing arrangements, in addition to manufacturing the beverage for sale to the brand owner, we have the right to sell the beverages using the brand owner's marks in certain of our channels through a licensing arrangement, as described above.

No individual licensing or manufacturing arrangement (including arrangements covering multiple brands) has accounted for more than 10% of our consolidated net sales in any period. We analyze the impact

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of each arrangement on consolidated net sales on an individual basis. We have determined that it is unlikely that we would lose our licensing or manufacturing rights to multiple brands at the same time. Each of our licensing and manufacturing arrangements are separately negotiated with unrelated parties, and each has distinct terms and conditions, including the duration of agreement and termination rights. Further, based upon the number of business relationships as well as the depth of our owned-brands, it is our belief that no individual business relationship is critical to the execution of our growth strategy.

Management is focused on executing our growth strategy to drive Keurig® hot beverage brewer adoption in households and offices in the U.S. and Canada in order to generate ongoing demand for portion packs.

We compete not only with other widely advertised branded products, but also with private label or generic products that generally are sold at lower prices.

For fiscal 2014, the Company's net sales of $4,707.7 million represented growth of 8% over fiscal 2013. Approximately 94% of our fiscal 2014 consolidated net sales were attributed to the combination of portion packs and Keurig® brewers and related accessories. Gross profit for fiscal 2014 was $1,815.9 million, or 38.6% of net sales, as compared to $1,619.4 million, or 37.2% of net sales, in fiscal 2013. Selling, operating, and general and administrative expenses ("SG&A") increased 2% to $868.6 million in fiscal 2014 from $854.2 million in fiscal 2013. As a percentage of sales, SG&A expenses decreased from 19.6% in fiscal 2013, to 18.5% in fiscal 2014. Our operating margin improved to 20.1% in fiscal 2014 from 17.6% in fiscal 2013.

We continually monitor all costs, including coffee, as we review our pricing structure, as cyclical swings in commodity markets are common. The recent years have seen significant volatility in the "C" price of coffee (i.e. the price per pound quoted by the Intercontinental Exchange). We expect coffee prices to remain volatile in the coming years.

We offer a one-year warranty on all Keurig® hot beverage brewers we sell and provide for the estimated cost of product warranties, primarily using historical information and current repair or replacement costs, at the time product revenue is recognized. In addition, sales of Keurig® hot beverage brewers are recognized net of an allowance for returns using an average return rate based on historical experience and an evaluation of contractual rights or obligations. We focus some of our research and development efforts on improving brewer reliability, strengthening its quality controls and product testing procedures. As we have grown, we have added significantly to our product testing, quality control infrastructure and overall quality processes. As we continue to innovate, and our products become more complex, both in design and componentry, product performance may modulate, causing warranty or sales returns rates to possibly fluctuate going forward. As a result, future warranty claims rates may be higher or lower than we are currently experiencing and for which we are currently providing for in our warranty or sales return reserves.

We generated $719.4 million in cash from operations during fiscal 2014 as compared to $836.0 million in fiscal 2013. During fiscal 2014, we completed two sales of our common stock resulting in proceeds of $1,348.4 million, net of transaction expenses. We used cash during fiscal 2014 primarily to repurchase shares of our common stock for $1,052.4 million, fund capital expenditures of $337.9 million and pay dividends of $118.4 million.

We consistently analyze our short-term and long-term cash requirements to continue to grow the business. We expect that most of our cash generated from operations will continue to be used to fund cash dividends, share repurchases, capital expenditures and the working capital required for our growth over the next few years.

Business Segments

We manage our operations through two operating segments, a Domestic segment including all U.S. Operations and immaterial operations related to international expansion, and a Canada segment including all

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Canadian operations. See Note 4, Segment Reporting, of the Notes to Consolidated Financial Statements included in this Annual Report.

We evaluate the performance of our operating segments based on several factors, including net sales to external customers and operating income. Net sales are recorded on a segment basis and intersegment sales are eliminated as part of the financial consolidation process. Operating income represents gross profit less selling, operating, general and administrative expenses. Our manufacturing operations occur within both the Domestic and Canada segments, and the costs of manufacturing are recognized in cost of sales in the operating segment in which the sale occurs. Information system technology services are mainly centralized while finance and accounting functions are primarily decentralized. Expenses consisting primarily of compensation and depreciation related to certain centralized administrative functions including information system technology are allocated to the operating segments. Expenses not specifically related to an operating segment are presented under "Corporate—Unallocated." Corporate—Unallocated expenses are comprised mainly of the compensation and other related expenses of certain of our senior executive officers and other selected employees who perform duties related to the entire enterprise. Corporate Unallocated expenses also include depreciation for corporate headquarters, corporate sustainability expenses, interest expense not directly attributable to an operating segment, the majority of foreign exchange gains or losses, certain corporate legal expenses and compensation of the Board of Directors.

Basis of Presentation

Included in this presentation are discussions and reconciliations of income before taxes, net income and diluted earnings per share in accordance with accounting principles generally accepted in the United States of America ("GAAP") to income before taxes, net income and diluted earnings per share excluding certain expenses and losses. We refer to these performance measures as non-GAAP net income and non-GAAP net income per share. These non-GAAP measures exclude any gain from the sale of Filterfresh U.S. based coffee services business including the effect of any tax benefits resulting from the use of net operating and capital loss carryforwards as a result of the Filterfresh sale; legal and accounting expenses related to the SEC inquiry and associated pending securities and stockholder derivative class action litigation; and non-cash related items such as amortization of identifiable intangibles and loss on extinguishment of debt, each of which include adjustments to show the tax impact of excluding these items. Each of these adjustments was selected because management uses these non-GAAP measures in discussing and analyzing its results of operations and because we believe the non-GAAP measures provide investors with greater transparency by helping to illustrate the underlying financial and business trends relating to our results of operations and financial condition and comparability between current and prior periods. For example, we excluded acquisition-related transaction expenses because these expenses can vary from period to period and transaction to transaction and expenses associated with these activities are not considered a key measure of our operating performance.

We use the non-GAAP measures to establish and monitor budgets and operational goals and to evaluate the performance of the Company. These non-GAAP measures are not in accordance with, or an alternative to, GAAP and should be considered in addition to, and not as a substitute or superior to, the other measures of financial performance prepared in accordance with GAAP. Using only the non-GAAP financial measures to analyze our performance would have material limitations because their calculation is based on the subjective determination of management regarding the nature and classification of events and circumstances that investors may find significant. We compensate for these limitations by presenting both the GAAP and non-GAAP measures of its results.

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Divestitures

On October 3, 2011, we sold all the outstanding shares of Van Houtte USA Holdings, Inc., also known as the Van Houtte U.S. Coffee Service business, or "Filterfresh" business, to ARAMARK Refreshment Services, LLC ("ARAMARK") in exchange for $149.5 million in cash. Approximately $4.4 million of cash was transferred to ARAMARK as part of the sale and $7.4 million was repaid to ARAMARK upon finalization of the purchase price, resulting in a net cash inflow related to the Filterfresh sale of $137.7 million.

Filterfresh was reported in the Canada segment prior to being sold. See Note 3, Divestitures, of the Notes to Consolidated Financial Statements included in this Annual Report.

Summary Financial Data of the Company

Our fiscal year ends on the last Saturday in September. Fiscal years 2014, 2013 and 2012 represent the years ended September 27, 2014, September 28, 2013 and September 29, 2012, respectively. Fiscal 2014 and 2013 consist of 52 weeks, and fiscal 2012 consists of 53 weeks.

The following table presents certain financial data of the Company expressed as a percentage of net sales for the periods denoted below:

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Net sales		100.0	%		100.0	%		100.0	%
Cost of sales		61.4	%		62.8	%		67.1	%
Gross profit		38.6	%		37.2	%		32.9	%
Selling and operating expenses		11.9	%		12.9	%		12.5	%
General and administrative expenses		6.5	%		6.7	%		5.7	%
Operating income		20.1	%*		17.6	%		14.7	%
Other income, net		0.0	%		0.0	%		0.0	%
Gain (loss) on financial instruments, net		0.2	%		0.1	%		(0.1	)%
(Loss) gain on foreign currency, net		(0.4	)%		(0.3	)%		0.2	%
Gain on sale of subsidiary		—	%		—	%		0.7	%
Interest expense		(0.2	)%		(0.4	)%		(0.6	)%
Income before income taxes		19.6	%*		17.0	%		14.9	%
Income tax expense		(6.9	)%		(5.9	)%		(5.5	)%
Net Income		12.7	%		11.1	%		9.4	%
Net income attributable to noncontrolling interests		0.0	%		0.0	%		0.0	%
Net income attributable to Keurig		12.7	%		11.1	%		9.4	%

*

Does not add due to rounding

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Segment Summary

Net sales and operating income for each of our operating segments are summarized in the tables below:

	Net sales (in millions)						2014 over 2013						2013 over 2012
	Fiscal 2014		Fiscal 2013		Fiscal 2012		$ Increase (Decrease)			% Increase (Decrease)			$ Increase (Decrease)		% Increase (Decrease)
Domestic	$	4,083.3	$	3,725.0	$	3,233.7	$	358.3			10	%	$	491.3		15	%
Canada		624.4		633.1		625.5		(8.7	)		(1	)%		7.6		1	%
Total net sales	$	4,707.7	$	4,358.1	$	3,859.2	$	349.6			8	%	$	498.9		13	%

	Operating income (loss) (in millions)									2014 over 2013						2013 over 2012
	Fiscal 2014			Fiscal 2013			Fiscal 2012			$ Increase (Decrease)			% Increase (Decrease)			$ Increase (Decrease)			% Increase (Decrease)
Domestic	$	1,016.6		$	826.1		$	576.9		$	190.5			23	%	$	249.2			43	%
Canada		102.6			87.7			76.2			14.9			17	%		11.5			15	%
Corporate—Unallocated		(172.0	)		(148.6	)		(84.2	)		(23.4	)		(16	)%		(64.4	)		(76	)%
Total operating income	$	947.2		$	765.2		$	568.9		$	182.0			24	%	$	196.3			35	%

Revenue

Company Summary

The following table presents consolidated net sales by major product category:

	Net Sales (in millions)						2014 over 2013						2013 over 2012
	Fiscal 2014		Fiscal 2013		Fiscal 2012		$ Increase (Decrease)			% Increase (Decrease)			$ Increase (Decrease)			% Increase (Decrease)
Portion packs	$	3,604.5	$	3,187.3	$	2,708.9	$	417.2			13	%	$	478.4			18	%
Brewers and accessories		822.3		827.6		759.8		(5.3	)		(1	)%		67.8			9	%
Other products and royalties		280.9		343.2		390.5		(62.3	)		(18	)%		(47.3	)		(12	)%
Total net sales	$	4,707.7	$	4,358.1	$	3,859.2	$	349.6			8	%	$	498.9			13	%

53rd Week

Fiscal 2012 had an additional week of sales (53rd week) due to the fact that our fiscal year ends the last Saturday of each September. The 53rd week increased fiscal 2012 net sales by approximately $90.0 million and net income by approximately $11.0 million (net of income taxes of $5.8 million), or $0.07 per share. The 53rd week is included in all comparisons to fiscal 2012 operating results.

Fiscal 2014

Net sales for fiscal 2014 increased by $349.6 million, or 8%, to $4,707.7 million as compared to $4,358.1 million reported in fiscal 2013. The 8% increase includes the unfavorable impact of foreign currency exchange rates which reduced net sales by approximately 1%.

The primary drivers of the 8% increase in our net sales as compared to the prior year were a $417.2 million, or 13%, increase in total portion pack net sales partially offset by a $5.3 million, or 1%, decrease in Keurig® brewer and accessory sales and a $62.3 million, or 18%, net decrease in other products.

The increase in portion pack net sales as compared to the prior year was driven by an approximate 18 percentage point increase due to volume, partially offset by (i) an approximate 3 percentage point decrease due to net price realization, (ii) an approximate 1 percentage point decrease due to sales mix and (iii) an approximate 1 percentage point decrease due to the impact of foreign currency exchange rates. During the fiscal year, the negative price realization was attributable to a price reduction, while the negative mix was attributable to the fact that we sold proportionately more packs to brand owners, where there is a lower wholesale selling price, than to retailers and consumers, where there is a higher wholesale average selling price. We anticipate this decrease in net sales due to mix change to fluctuate over time, and, as we anticipate adding more brand owners, we believe this negative mix trend may continue.

The decrease in brewer and accessory net sales as compared to the prior year was primarily driven by a $9.8 million decrease in brewer net sales offset by a $4.5 million increase in accessory net sales. The decrease in brewer net sales was primarily driven by (i) an approximate 10 percentage point decrease due to brewer net price realization resulting from a continued strategic decision to drive brewer volume and to further expand the installed base of our Keurig® hot platform

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and (ii) a roughly 1 percentage point decrease due to the impact of foreign currency exchange partially offset by (i) an approximate 6 percentage point increase due to brewer sales volume and (ii) an approximate 3 percentage point increase due to brewer sales mix.

Net sales of other products decreased $62.3 million, or 18%, as compared to the prior year primarily due to the continuing demand shift from traditional coffee package format to portion packs.

Fiscal 2013

Net sales for fiscal 2013 increased 13% to $4,358.1 million, up from $3,859.2 million reported in fiscal 2012. The primary drivers of the increase in the Company's net sales were a 18%, or $478.4 million, increase in portion pack net sales, a 9%, or $67.8 million, increase in Keurig® brewer and accessories sales, offset by a 12%, or $47.3 million, net decrease in other products and royalties primarily by a demand shift from coffee sold in traditional package formats to portion packs. Net sales for fiscal 2013 as compared to fiscal 2012 were not materially affected by fluctuations in foreign currency exchange rates.

The increase in portion pack net sales was driven primarily by a 22 percentage point increase in sales volume, offset by a 3 percentage point reduction due to portion pack mix and a 1 percentage point decrease in portion pack net price realization.

Domestic

Fiscal 2014

The Domestic segment net sales increased by $358.3 million, or 10%, to $4,083.3 million in fiscal 2014 as compared to $3,725.0 million in fiscal 2013. The increase was due primarily to a $373.7 million, or 13%, increase related to sales of portion packs.

Fiscal 2013

Domestic segment net sales increased by $491.3 million or 15%, to $3,725.0 million in fiscal 2013 as compared to $3,233.7 million in fiscal 2012. The increase was due primarily to a $438.6 million, or 18%, increase related to sales of portion packs and a $60.9 million, or 9%, increase related to sales of Keurig® brewers and accessories.

Canada

Fiscal 2014

Canada segment net sales decreased by $8.7 million, or 1%, to $624.4 million in fiscal 2014 as compared to $633.1 million in fiscal 2013. Excluding a $39.0 million, or 6%, decrease related to the unfavorable impact of foreign currency exchange rates, Canada segment net sales increased $30.3 million, or 5%, over the prior year period. This increase was due primarily to a $65.7 million, or 21%, increase related to the sale of portion packs, partially offset by (i) a $24.3 million, or 11%, decrease in sales of other products, such as coffee sold in traditional package formats, driven by a demand shift from coffee sold in traditional package formats to portion packs, and (ii) a $11.1 million, or 11%, decrease related to sales of Keurig® brewers and accessories, driven primarily by a decrease in net price realization related to brewers.

Fiscal 2013

Canada net sales increased by $7.6 million, or 1%, to $633.1 million in fiscal 2013 as compared to $625.5 million in fiscal 2012. The increase in net sales, excluding a $9.2 million, or 1.5%, decrease related to the unfavorable impact of foreign currency exchange rates, was due primarily to (i) a $44.9 million, or 16%, increase related to the sale of portion packs, partially offset by a $35.8 million, or 14%, decrease in sales of other products, such as coffee sold in traditional package formats, driven by a demand shift from coffee sold in traditional package formats to portion packs, and (ii) a $7.7 million, or 8%, increase related to sales of Keurig® brewers and accessories.

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Gross Profit

Fiscal 2014

Gross profit for fiscal 2014 was $1,815.9 million, or 38.6% of net sales, as compared to $1,619.4 million, or 37.2% of net sales, in fiscal 2013. The increase in gross margin as compared to the prior year was primarily attributable to (i) an increase of approximately 330 basis points due to favorable green coffee costs, (ii) an increase of approximately 120 basis points due to logistics productivity and (iii) an increase of approximately 90 basis points due to a shift in sales mix between Keurig® brewers and portion packs. This was partially offset by (i) a decrease of approximately 210 basis points due to lower net price realization associated with both portion packs and brewers, (ii) a decrease of approximately 100 basis points due to brewer and portion pack sales mix, (iii) a decrease of approximately 90 basis points due to increased portion pack packaging material costs and (iv) a decrease of approximately 50 basis points due to higher warranty expense.

Fiscal 2013

Gross profit for fiscal 2013 was $1,619.4 million, or 37.2% of net sales as compared to $1,269.4 million, or 32.9% of net sales, in fiscal 2012. Gross margin increased approximately (i) 290 basis points due to lower green coffee costs, (ii) 100 basis points due to lower labor and overhead manufacturing costs, (iii) 80 basis points due to a decrease in warranty expense related to the Keurig® brewers in fiscal 2013, as compared to the prior year, and (iv) 60 basis points due to lower sales returns primarily related to Keurig® brewers. The increase in gross margin was partially offset by a 100 basis point decrease due to net price realization.

Selling, General and Administrative Expenses

Fiscal 2014

Selling, operating, and general and administrative ("SG&A") expenses increased 2% to $868.6 million in fiscal 2014 from $854.2 million in fiscal 2013. As a percentage of sales, SG&A expenses decreased to 18.5% in fiscal 2014 from 19.6% in the prior year period. The 2% increase in fiscal 2014 over the prior year period was primarily attributable to increased information technology expenditures to support infrastructure and an increase in research and development expenditures to support the launch of new product platforms, partially offset by decreases in marketing and sales related activity.

Fiscal 2013

SG&A expenses increased 22% to $854.2 million in fiscal 2013 from $700.5 million in fiscal 2012. As a percentage of sales, SG&A expenses increased to 19.6% in fiscal 2013 from 18.2% in fiscal 2012 due to additional brand support through marketing activities and increased expenditures to support infrastructure and planned product introductions in fiscal 2013. The increase in SG&A expenses in fiscal 2013 over the prior year period was primarily attributed to increases of $60.4 million in marketing and sales related expenses, $16.0 million in research and development expenses, and increases in general and administrative expenses, primarily $23.4 million in incentive compensation and $19.7 million in salaries associated with building infrastructure to support the business.

Segment Operating Income (Loss)

Fiscal 2014

Operating income for the Domestic segment increased by $190.5 million, or 23%, as compared to the prior year period which was primarily attributable to higher sales volume for portion packs as well as favorable green coffee costs. Operating income for the Canada segment increased by $14.9 million, or 17%, as compared to the prior year period which was primarily attributable to favorable green coffee costs and logistics productivity. The operating loss for Corporate—Unallocated increased by $23.4 million, or 16%, as compared to the prior year period which was primarily due to increased facilities expenses.

39

Fiscal 2013

Operating income for the Domestic segment increased by $249.2 million, or 43%, as compared to the prior year period which was primarily attributable to higher sales volume for portion packs and favorable green coffee costs. Operating income for the Canada segment increased by $11.5 million, or 15%, as compared to the prior year period which was primarily attributable to favorable green coffee costs. The operating loss for Corporate—Unallocated increased by $64.4 million, or 76%, as compared to the prior year period which was primarily due to increased personnel, consulting and facilities expenses.

Gain (Loss) on Financial Instruments

Fiscal 2014

We incurred $8.3 million in net gains on financial instruments not designated as hedges for accounting purposes during fiscal 2014 as compared to $5.5 million in net gains during fiscal 2013. For fiscal 2014 and 2013, the net gains were primarily attributable to the fair value adjustment of our cross currency swap, which hedges the risk in currency movements on an intercompany note denominated in Canadian currency.

Fiscal 2013

We incurred $5.5 million in net gains on financial instruments not designated as hedges for accounting purposes during fiscal 2013 as compared to $4.9 million in net losses during fiscal 2012. For fiscal 2013, the net gains were primarily attributable to the fair value adjustment of our cross currency swap, which hedges the risk in currency movements on an intercompany note denominated in Canadian currency.

Foreign Currency Exchange Gain (Loss), Net

Fiscal 2014

We have certain assets and liabilities that are denominated in foreign currencies. During fiscal 2014, we incurred a net foreign currency loss of approximately $19.7 million as compared to a net loss of $12.6 million during fiscal 2013. The net foreign currency exchange losses were both attributable to re-measurement of certain intercompany notes with our foreign subsidiaries which fluctuate due to the relative strength or weakness of the U.S. dollar against the Canadian dollar.

Fiscal 2013

We have certain assets and liabilities that are denominated in foreign currencies. During fiscal 2013, we incurred a net foreign currency loss of approximately $12.6 million as compared to a net gain of $7.0 million during fiscal 2012. The net foreign currency exchange gains and losses primarily related to re-measurement of our alternative currency revolving credit facility and certain intercompany notes with our foreign subsidiaries.

Gain on Sale of Subsidiary

On October 3, 2011, we sold all the outstanding shares of the Filterfresh business resulting in a gain of $26.3 million.

Interest Expense

Fiscal 2014

Interest expense was $11.7 million in fiscal 2014, as compared to $18.2 million in fiscal 2013. The decrease in interest expense was primarily due to lower average outstanding debt during fiscal 2014 as compared to the average outstanding debt during fiscal 2013.

40

Fiscal 2013

Interest expense was $18.2 million in fiscal 2013, as compared to $23.0 million in fiscal 2012. The decrease in interest expense was primarily due to lower average outstanding debt during fiscal 2013 as compared to the average outstanding debt during fiscal 2012.

Income Taxes

Fiscal 2014

Our effective income tax rate was 35.4% for fiscal 2014 as compared to a 34.7% effective tax rate fiscal 2013. The higher effective rate in fiscal 2014 was primarily attributable to a reduction in our available research and development federal tax credit.

Fiscal 2013

Our effective income tax rate was 34.7% for fiscal 2013 as compared to a 36.9% effective tax rate for fiscal 2012. The lower effective rate in fiscal 2013 was due primarily to a $14.3 million increase related to domestic production activities deductions, and a $4.2 million increase related to research and development federal tax credits, primarily attributed to a catch-up adjustment from fiscal 2012 and a credit for fiscal 2013 due to the enactment of the American Taxpayer Relief Act of 2012 on January 2, 2013.

Net Income, Non-GAAP Net Income and Diluted EPS

Net income in fiscal 2014 was $596.5 million, an increase of $113.3 million or 23%, as compared to $483.2 million in fiscal 2013.

Company net income in fiscal 2012 was $362.6 million. Non-GAAP net income for fiscal 2014, when excluding amortization of identifiable intangibles related to the Company's acquisitions and legal and accounting expenses related to the SEC inquiry and associated pending securities and stockholder derivative class action litigation, increased 21% to $627.9 million from $517.6 million non-GAAP net income in fiscal 2013. Fiscal 2013 non-GAAP net income, when excluding amortization of identifiable intangibles related to the Company's acquisitions and legal and accounting expenses related to the SEC inquiry and associated pending securities and stockholder derivative class action litigation, increased 36% to $517.6 million from $381.6 million in fiscal 2012. Non-GAAP net income in fiscal 2012 was $381.6 million, which excludes transaction-related expenses amortization of identifiable intangibles related to the Company's acquisitions; legal and accounting expenses related to the SEC inquiry and associated pending securities and stockholder derivative class action litigation; and the gain from the sale of Filterfresh based coffee services business.

In fiscal 2012, we had an additional week of activity (53rd week) due the fact that our fiscal year ends the last Saturday of each September. The 53rd week increased fiscal 2012 non-GAAP net income by approximately $11.0 million and non-GAAP diluted EPS by approximately $0.07 per share.

Company diluted EPS was $3.74 per share in fiscal 2014, as compared to $3.16 per share in fiscal 2013 and $2.28 per share in fiscal 2012. Non-GAAP diluted EPS was $3.93 per share in fiscal 2014, as compared to $3.39 per share in fiscal 2013 and $2.40 per share in fiscal 2012.

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The following tables show a reconciliation of net income and diluted EPS to non-GAAP net income and non-GAAP diluted EPS for fiscal years 2014, 2013 and 2012 (in thousands, except per share data):

	Fiscal 2014		Fiscal 2013		Fiscal 2012
Net income attributable to Keurig	$	596,518	$	483,232	$	362,628
After tax:
Expenses related to SEC inquiry and pending litigation(1)		2,023		3,208		4,073
Amortization of identifiable intangibles(2)		29,324		31,128		31,555
Gain on sale of subsidiary(3)		—		—		(16,685	)
Non-GAAP net income attributable to Keurig	$	627,865	$	517,568	$	381,571

	Fiscal 2014		Fiscal 2013			Fiscal 2012
Diluted income per share	$	3.74	$	3.16		$	2.28
After tax:
Expenses related to SEC inquiry and pending litigation(1)	$	0.01	$	0.02		$	0.03
Amortization of identifiable intangibles(2)	$	0.18	$	0.20		$	0.20
Gain on sale of subsidiary(3)	$	—	$	—		$	(0.10	)
Non-GAAP net income per share	$	3.93	$	3.39	*	$	2.40	*

*

Does not add due to rounding.

⁽¹⁾

Represents legal and accounting expenses, net of income taxes of $1.1 million, $1.7 million and $2.6 million for fiscal 2014, fiscal 2013 and fiscal 2012, respectively, related to the SEC inquiry and pending securities and stockholder derivative class action litigation classified as general and administrative expense. Income taxes were calculated at our effective tax rate.

⁽²⁾

Represents the amortization of intangibles, net of income taxes of $13.7 million for fiscal 2014, $14.3 million for fiscal 2013, and $14.4 million for fiscal 2012, related to the Company's acquisitions classified as general and administrative expense. Income taxes were calculated at our deferred tax rates.

⁽³⁾

Represents the gain recognized on the sale of Filterfresh, net of income taxes of $9.6 million. The income taxes of $9.6 million include the tax benefit of $6.2 million resulting from the release of the valuation allowance in fiscal 2011.

Liquidity and Capital Resources

We principally have funded our operations, working capital needs, capital expenditures, share repurchases and cash dividends from operations, equity offerings and borrowings under our credit facilities. At September 27, 2014, we had $160.0 million in outstanding debt, $118.5 million in capital lease and financing obligations, $761.2 million in cash and cash equivalents and $1,602.5 million of working capital (including cash). At September 28, 2013, we had $173.2 million in outstanding debt, $77.8 million in capital lease and financing obligations, $260.1 million in cash and cash equivalents and $924.4 million of working capital (including cash).

Our cash and cash equivalents totaled $761.2 million and $260.1 million as of September 27, 2014, and September 28, 2013, respectively. We actively manage our cash and cash equivalents in order to internally fund our operating needs, make scheduled interest and principal payments on our borrowings, invest in our innovation pipeline and business growth opportunities, and return cash to shareholders through common stock cash dividend payments and share repurchases.

With the exception of the repayment of intercompany debt, all earnings of our foreign subsidiaries are considered indefinitely reinvested and no U.S. deferred taxes have been provided on those earnings. If these amounts were distributed to the U.S. in the form of dividends or otherwise, we would be subject to additional U.S. income taxes, which could be material. Determination of the amount of any unrecognized

42

deferred income tax on these earnings is not practicable because such liability, if any, is dependent on circumstances existing if and when remittance occurs. As of September 27, 2014, we had $36.5 million of cash and cash equivalents held in international jurisdictions which will be used to fund capital and other cash requirements of international operations, primarily held by our Canadian business.

Operating Activities:

Net cash provided by operations is principally comprised of net income and is primarily affected by the net change in working capital and non-cash items relating to depreciation and amortization.

Net cash provided by operating activities was $719.4 million in fiscal 2014 as compared to $836.0 million in fiscal 2013. We generated $597.4 million in net income in fiscal 2014. Significant non-cash items primarily consisted of $257.6 million in depreciation and amortization expense and $114.1 million in charges related to our provision for sales returns. Other significant changes in assets and liabilities affecting net cash provided by operating activities were increases in accounts receivable and inventories of $274.9 million and $166.5 million, respectively, offset by increases in accounts payable and accrued expenses and tax payable of $133.8 million and $120.6 million, respectively. The increase in accounts receivable was primarily attributable both to an overall increase in net sales in the fourth quarter of fiscal 2014 as compared to the fourth quarter of fiscal 2013, and to an increase in net sales in advance of the go-live of components of our new enterprise-wide system solution subsequent to the end of fiscal 2014. The increase in inventories was primarily attributable to increases in brewer and portion pack inventories as the company prepares for its seasonal increase in sales volume and inventory build in advance of the go-live of components of our new enterprise-wise system solution, partially offset by a decrease in raw material inventories. The increase in accounts payable and accrued expenses was primarily attributable to increases in accounts payable, accrued bonus compensation, and accrued customer incentives and promotions.

Investing Activities:

Investing activities in fiscal 2014 primarily included purchase of short-term and long-term investments along with capital expenditures for equipment and building improvements.

Capital expenditures were $337.9 million in fiscal 2014 as compared to $232.8 million in fiscal 2013. Capital expenditures incurred on an accrual basis during fiscal 2014 consisted primarily of $138.2 million related to new product platforms, $121.8 million related to facilities and related infrastructure, $65.2 million related to information technology infrastructure and systems, $34.8 million related to coffee processing and other equipment, and $32.4 million related to increasing packaging capabilities for the Keurig® brewer platforms. Of the $121.8 million in capital expenditures related to facilities and related infrastructure, $40.1 million relates to fixed assets acquired through financing obligations. For fiscal 2015, we currently expect to invest between $425.0 million to $475.0 million in capital expenditures to support our future growth.

Financing Activities:

Cash provided by financing activities for fiscal 2014 totaled $253.0 million. We received $1,348.4 million, net of transaction-related expenses, from the issuance of 16,684,139 shares of common stock to Atlantic Industries, a wholly owned subsidiary of The Coca-Cola Company, and the issuance of 1,407,000 shares of common stock to Lavazza. In fiscal 2014, we used $1,052.4 million of cash to repurchase approximately 8.1 million of our common shares pursuant to repurchase programs under which our Board of Directors has authorized the repurchase of up to an aggregate of $2.5 billion of our common shares through various times from fiscal 2012 through fiscal 2014, at such times and prices as determined by the Company's management. In fiscal 2014, we also made payments related to our debt of $13.4 million, principally under our term loan A. Cash flows from operating and financing activities included a $55.4 million tax benefit from the exercise of non-qualified options and disqualifying dispositions of incentive stock

43

options. As stock is issued from the exercise of options and the vesting of restricted stock units, we will continue to receive proceeds and a tax deduction where applicable; however we cannot predict either the amounts or the timing of any such proceeds or tax benefits.

Long Term Debt

Under our current credit facility ("Restated Credit Agreement"), we maintain senior secured credit facilities consisting of (i) an $800.0 million U.S. revolving credit facility, (ii) a $200.0 million alternative currency revolving credit facility, and (iii) a term loan A facility. At September 27, 2014, we had $158.4 million outstanding under the term loan A facility, no balances outstanding under the revolving credit facilities and $7.8 million in letters of credit with $992.2 million available for borrowing. The Restated Credit Agreement also provides for an increase option for an aggregate amount of up to $500.0 million.

The term loan A facility requires quarterly principal repayments. The term loan and revolving credit borrowings bear interest at a rate equal to an applicable margin plus, at our option, either (a) a eurodollar rate determined by reference to the cost of funds for deposits for the interest period and currency relevant to such borrowing, adjusted for certain costs, or (b) a base rate determined by reference to the highest of (1) the federal funds rate plus 0.50%, (2) the prime rate announced by Bank of America, N.A. from time to time and (3) the eurodollar rate plus 1.00%. The applicable margin under the Restated Credit Agreement with respect to the term loan A and revolving credit facilities is a percentage per annum varying from 0.5% to 1.0% for base rate loans and 1.5% to 2.0% for eurodollar rate loans, based upon our leverage ratio. Our average effective interest rate at September 27, 2014 and September 28, 2013 was 3.7% and 3.5%, respectively, excluding amortization of deferred financing charges and including the effect of interest rate swap agreements. We also pay a commitment fee on the average daily unused portion of the revolving credit facilities.

All of our assets and the assets of our domestic wholly-owned material subsidiaries are pledged as collateral under the Restated Credit Agreement. The Restated Credit Agreement contains customary negative covenants, subject to certain exceptions, including limitations on: liens; investments; indebtedness; mergers and consolidations; asset sales; dividends and distributions or repurchases of our capital stock; transactions with affiliates; certain burdensome agreements; and changes in our lines of business.

The Restated Credit Agreement requires us to comply on a quarterly basis with a consolidated leverage ratio and a consolidated interest coverage ratio. At September 27, 2014, we were in compliance with these covenants. In addition, the Restated Credit Agreement contains certain mandatory prepayment requirements and customary events on default.

Interest Rate Swaps

We are party to interest rate swap agreements, the effect of which is to limit the interest rate exposure on a portion of the loans under our credit facilities to a fixed rate versus the 30-day Libor rate. The total notional amount of these swaps at September 27, 2014 was $130.0 million.

The fair market value of the interest rate swaps is the estimated amount that we would receive or pay to terminate the agreements at the reporting date, taking into account current interest rates and the credit worthiness of the counterparty. At September 27, 2014, we estimate we would have paid $3.4 million (gross of tax), if we terminated the swap agreements. We designate the swap agreements as cash flow hedges and the changes in the fair value of these derivatives are classified in accumulated other comprehensive income (loss) (a component of equity). During fiscal years 2014, 2013 and 2012, we paid approximately $3.2 million, $3.4 million and $4.7 million, respectively, in additional interest expense pursuant to interest rate swap agreements.

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Stock Issuances

On February 27, 2014, we sold 16,684,139 shares of common stock to Atlantic Industries, an indirect wholly owned subsidiary of The Coca-Cola Company, at $74.98 per share for an aggregate purchase price of $1,251.0 million, pursuant to a common stock purchase agreement dated February 5, 2014.

In addition, pursuant to pre-emptive rights set forth in the Common Stock Purchase Agreement between us and Lavazza dated August 10, 2010, we agreed not to sell or issue any shares of Common Stock for a period of five years and six months after September 28, 2010 without first offering Lavazza the opportunity to purchase an amount of newly issued securities which entitles Lavazza to maintain its current percentage ownership, on terms and conditions not less favorable than those proposed for such offering, including price. As a result of the February 27, 2014 issuance of common stock to Atlantic Industries described above, on March 28, 2014, we entered into a common stock purchase agreement with Lavazza to sell 1,407,000 shares of our common stock to Lavazza at $74.98 per share for an aggregate purchase price of $105.5 million. The transaction closed on April 17, 2014.

Share Repurchases and Dividends

Throughout various times during fiscal 2012, 2013, and 2014, our Board of Directors authorized the Company to repurchase a total of $2.5 billion of the Company's common stock. As of September 27, 2014, $1,182.8 million of this aggregate authorized amount remained available for common stock repurchases. Additional repurchases will be made with cash on hand, cash from operations and funds available through our existing credit facility. See Note 14, Stockholders' Equity, of the Notes to the audited Consolidated Financial Statements included in this Annual Report.

On February 28, 2014, we entered into an accelerated share repurchase ("ASR") agreement with a major financial institution ("Bank") pursuant to the repurchase programs. The ASR allows us to buy a large number of shares immediately at a purchase price determined by an average market price over a period of time. Under the ASR, we agreed to purchase $700.0 million of our common stock, in total, with an initial delivery to us of 4,340,508 shares ("Initial Shares") of our common stock by the Bank. The Initial Shares represent the number of shares at the current market price equal to 70% of the total fixed purchase price of $700.0 million. The repurchased shares were retired and returned to an unissued status. The remainder of the total purchase price of $210.0 million reflects the value of the stock held by the Bank pending final settlement and, accordingly, was recorded as a reduction to additional paid-in capital. Final settlement of the ASR will occur no sooner than November 24, 2014 and no later than February 27, 2015 at the Bank's discretion. Upon settlement of the ASR, the total shares repurchased by us will be determined based on a share price equal to the daily volume weighted-average price ("VWAP") of our common stock during the term of the ASR program, less a fixed per share discount amount. At settlement, the Bank will deliver additional shares to us in the event total shares are greater than the 4,340,508 shares initially delivered, and we will issue additional shares to the Bank in the event total shares are less than the shares initially delivered. The receipt or issuance of additional shares will result in a reclassification between additional paid-in capital and common stock equal to the par value of the additional shares received or issued. The number of shares that we may be required to issue to the Bank is limited to 10.0 million shares under the ASR.

During fiscal 2014, we declared a quarterly dividend of $0.25 per common share, or $158.9 million in the aggregate. During the fiscal year ended September 27, 2014, we paid dividends of approximately $118.4 million.

On November 13, 2014, our Board of Directors declared the next quarterly cash dividend of $0.2875 per common share, an increase of 15 percent over previous quarters, payable on February 12, 2015 to shareholders of record as of the close of business on January 13, 2015.

We believe that our cash flows from operating activities, existing cash and our credit facilities will provide sufficient liquidity through the next

45

12 months to pay all liabilities in the normal course of business, fund anticipated capital expenditures, service debt requirements, fund any purchases of our common shares under the repurchase program, and pay dividends. We continually evaluate our capital requirements and access to capital. We may opt to raise additional capital through equity and/or debt financing to provide flexibility to assist with managing several risks and uncertainties inherent in a growing business including potential future acquisitions or increased capital expenditure requirements.

A summary of future cash requirements related to our outstanding long-term debt, minimum lease payments and purchase commitments as of September 27, 2014 is as follows (in thousands):

	Long-Term Debt		Interest Expense(1)		Operating Lease Obligations		Capital Lease Obligations(2)		Financing Obligations(3)		Purchase Obligations(4)		Total
FY 2015	$	19,077	$	5,668	$	15,856	$	3,838	$	8,828	$	901,612	$	954,879
FY 2016 - FY 2017		140,370		1,992		22,324		7,676		19,546		503,402		695,310
FY 2018 - FY 2019		567		31		11,138		7,676		19,824		328,801		368,037
Thereafter		—		—		26,736		27,820		105,833		109,805		270,194
Total	$	160,014	$	7,691	$	76,054	$	47,010	$	154,031	$	1,843,620	$	2,288,420

⁽¹⁾

Based on rates in effect at September 27, 2014.

⁽²⁾

Includes principal and interest payments under capital lease obligations.

⁽³⁾

Represents portion of the future minimum lease payments allocated to the building which will be recognized as reductions to the financing obligation and interest expense upon completion of construction.

⁽⁴⁾

Certain purchase obligations are determined based on a contractual percentage of forecasted volumes.

In addition, we have $14.8 million in unrecognized tax benefits primarily as the result of acquisitions of which we are indemnified for $9.2 million expiring through June 2015. We are unable to make reasonably reliable estimates of the period of cash settlement, if any, due to the uncertain nature of the unrecognized tax benefits.

Factors Affecting Quarterly Performance

Historically, the Company has experienced variations in sales and earnings from quarter to quarter due to the holiday season and a variety of other factors, including, but not limited to, the cost of green coffee, competitor initiatives, marketing programs, weather and special or unusual events. Because of the seasonality of our business, results for any quarter are not necessarily indicative of the results that may be achieved for the full fiscal year.

Critical Accounting Policies

This discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which we prepare in accordance with GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period (see Note 2, Significant Accounting Policies, to our Consolidated Financial Statements included in this Annual Report on Form 10-K). Actual results could differ from those estimates. We believe the following accounting policies and estimates require us to make the most difficult judgments in the preparation of our consolidated financial statements and accordingly are critical.

Goodwill and Intangibles

Goodwill is tested for impairment annually at the end of our fiscal year or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Goodwill is assigned to reporting units for purposes of impairment testing. A reporting unit is the same as an operating segment or one level below an operating segment. We have defined three reporting units in our evaluation of goodwill for potential impairment: Domestic; Canada—Roasting and Retail; and Canada—Coffee Services, based on the availability of discrete financial information that is regularly reviewed by management. We may assess qualitative factors to determine if it is more likely than not (i.e., a likelihood of more than 50%) that the fair value of a reporting unit is less than its carrying amount, including goodwill. If we determine that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, no further testing is necessary. If, however, we determine that it is more likely than not that the fair

46

value of a reporting unit is less than its carrying amount, we perform the first step of a two-step goodwill impairment test. The assessment of qualitative factors is optional and at our discretion. We may bypass the qualitative assessment for any reporting unit in any period and perform the first step of the quantitative goodwill impairment test. We may resume performing the qualitative assessment in any subsequent period. The first step is a comparison of each reporting unit's fair value to its carrying value. We estimate fair value based on discounted cash flows. The reporting unit's discounted cash flows require significant management judgment with respect to sales forecasts, gross margin percentages, SG&A expenses, capital expenditures and the selection and use of an appropriate discount rate. The projected sales, gross margin and SG&A expense rate assumptions and capital expenditures are based on our annual business plan or other forecasted results. Discount rates reflect market-based estimates of the risks associated with the projected cash flows directly resulting from the use of those assets in operations. The estimates of fair value of reporting units are based on the best information available as of the date of the assessment. If the carrying value of a reporting unit exceeds its estimated fair value in the first step, a second step is performed, which requires us to allocate the fair value of the reporting unit derived in the first step to the fair value of the reporting unit's net assets, with any fair value in excess of amounts allocated to such net assets representing the implied fair value of goodwill for that reporting unit. If the implied fair value of the goodwill is less than the book value, goodwill is impaired and is written down to the implied fair value amount.

Intangible assets that have finite lives are amortized over their estimated economic useful lives on a straight line basis. Intangible assets that have indefinite lives are not amortized and are tested for impairment annually or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Similar to the qualitative assessment for goodwill, we may assess qualitative factors to determine if it is more likely than not (i.e., a likelihood of more than 50%) that the fair value of the indefinite-lived intangible asset is less than its carrying amount. If we determine that it is not more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount, no further testing is necessary. If, however, we determine that it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount, we compare the fair value of the indefinite-lived asset with its carrying amount. If the carrying value of an individual indefinite-lived intangible asset exceeds its fair value, the individual indefinite-lived intangible asset is written down by an amount equal to such excess. The assessment of qualitative factors is optional and at our discretion. We may bypass the qualitative assessment for any indefinite-lived intangible asset in any period and resume performing the qualitative assessment in any subsequent period.

Due to the inherent uncertainty involved in estimating sales growth and related expense growth, we believe that these are critical estimates for us. We have not made any material changes to the accounting methodology we use to assess the necessity of an impairment charge, either for goodwill or for both finite and indefinite-lived intangible assets. Based upon the results of our fiscal 2014 impairment tests (See Note 7, Goodwill and Intangible Assets, of the Notes to Consolidated Financial Statements included in this Annual Report), there were no material impairment charges recognized for goodwill or intangible assets. Further, the fair values of all reporting units were significantly in excess of the carrying values. As we continually reassess our fair value assumptions, including estimated future cash flows, changes in our estimates and assumptions could cause us to recognize future material charges.

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Sales Return Allowance

Sales of coffee brewers, portion packs and other coffee products are recognized net of any discounts, returns, allowances and sales incentives, including coupon redemptions and rebates. We estimate the allowance for returns using an average return rate based on historical experience and an evaluation of contractual rights or obligations.

Product Warranty

We provide for the estimated cost of product warranties in cost of sales, at the time product revenue is recognized. Warranty costs are estimated primarily using historical warranty information in conjunction with current engineering assessments applied to our expected repair or replacement costs. The estimate for warranties requires assumptions relating to expected warranty claims which can be impacted significantly by quality issues. We currently believe that our warranty reserves are adequate; however, there can be no assurance that we will not experience some additional warranty expense in future periods related to previously sold brewers. A 10 percentage point increase in the fiscal 2014 overall claims estimate would have resulted in additional expense, net of recoveries, of approximately $2.7 million in the accompanying fiscal 2014 Consolidated Statement of Operations.

Inventories

Inventories consist primarily of green and roasted coffee, including coffee in portion packs, purchased finished goods such as coffee brewers, and packaging materials. Inventories are stated at the lower of cost or market. Cost is being measured using an adjusted standard cost method which approximates FIFO (first-in first-out). We regularly review whether the net realizable value of our inventory is lower than its carrying value. Based upon the specific identification method, if the valuation shows that the net realizable value is lower than the carrying value, we take a charge to expense and reduce the carrying value of the inventory.

We estimate any required write-downs for inventory obsolescence by examining our inventories on a quarterly basis to determine if there are indicators that the carrying values could exceed net realizable value. Indicators that could result in additional inventory write-downs include age of inventory, damaged inventory, slow moving products and products at the end of their life cycles. While significant judgment is involved in determining the net realizable value of inventory, we believe that inventory is appropriately stated at the lower of cost or market.

Recent Accounting Pronouncements

Information required by this Item is contained in Note 2, Significant Accounting Policies, of the Notes to the audited Consolidated Financial Statements included within Part II of this Annual Report on Form 10-K.

Off-Balance Sheet Arrangements

The Company's off-balance sheet arrangements consist of certain letters of credit and are detailed in Note 10, Long-Term Debt, of the Notes to Consolidated Financial Statements in this Annual Report on Form 10-K. We do not have, nor do we engage in, transactions with any special purpose entities.

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Item 7A.    Quantitative and Qualitative Disclosures About Market Risk

Market risks relating to our operations result primarily from changes in interest rates and the commodity "C" price of coffee (the price per pound quoted by the Intercontinental Exchange). To address these risks, we enter into hedging transactions as described below. We do not use financial instruments for trading purposes.

For purposes of specific risk analysis, we use sensitivity analysis to determine the impacts that market risk exposures may have on our financial position or earnings.

Interest rate risks

The table below provides information about our debt obligations, some of which are sensitive to changes in interest rates. The table presents principal cash flows and weighted average interest rates by fiscal year:

	2015			2016			2017			2018			2019			Thereafter			Total Debt Outstanding and average effective interest rate at September 27, 2014
Variable rate (in thousands)	$	18,755		$	9,688		$	—		$	—		$	—		$	—		$	28,443
Average interest rate		1.7	%		1.7	%		—	%		—	%		—	%		—	%		1.7	%
Fixed rate (in thousands)	$	322		$	130,334		$	348		$	364		$	203		$	—		$	131,571
Average interest rate		4.0	%		4.0	%		3.9	%		3.9	%		3.9	%		—	%		4.0	%

At September 27, 2014, we had $28.4 million of outstanding debt obligations subject to variable interest rates. Should all our variable interest rates increase by 100 basis points, we would incur additional interest expense of $0.3 million annually. Additionally, should Canadian Bankers' Acceptance Rates increase by 100 basis points over US Libor rates, we would incur additional interest expense of $0.9 million annually, pursuant to the cross-currency swap agreement (see Foreign Currency Exchange Risk below). As discussed further under the heading Liquidity and Capital Resources the Company is party to interest rate swap agreements. On September 27, 2014, the effect of our interest rate swap agreements was to limit the interest rate exposure on $130.0 million of the outstanding balance of the term loan A facility under the Restated Credit Agreement to a fixed rate versus the 30-day Libor rate. The total notional amount covered by these interest rate swaps will terminate in November 2015.

Commodity price risks

The "C" price of coffee is subject to substantial price fluctuations caused by multiple factors, including but not limited to weather and political and economic conditions in coffee-producing countries. Our gross profit margins can be significantly impacted by changes in the "C" price of coffee. We enter into fixed coffee purchase commitments in an attempt to secure an adequate supply of coffee. These agreements are tied to specific market prices (defined by both the origin of the coffee and the time of delivery) but we have significant flexibility in selecting the date of the market price to be used in each contract. At September 27, 2014, the Company had approximately $407.7 million in green coffee purchase commitments, of which approximately 88% had a fixed price. At September 28, 2013, the Company had approximately $245.1 million in green coffee purchase commitments, of which approximately 84% had a fixed price.

Commodity price risks at September 27, 2014 are as follows (in thousands, except average "C" price):

Purchase commitments	Total Cost(1)		Pounds		Average "C" Price
Fixed(2)	$	347,847		157,439	$	1.78
Variable	$	47,178		20,575	$	1.93
	$	395,025		178,014

⁽¹⁾

Total coffee costs typically include a premium or "differential" in addition to the "C" price.

⁽²⁾

Excludes $12.7 million in price-fixed coffee purchase commitments (4.6 million pounds) that are not determined by the "C" price.

49

We regularly use commodity-based financial instruments to hedge price-to-be-established coffee purchase commitments with the objective of minimizing cost risk due to market fluctuations. These hedges generally qualify as cash flow hedges. Gains and losses are deferred in other comprehensive income until the hedged inventory sale is recognized in earnings, at which point gains and losses are recognized in cost of sales. At September 27, 2014, we held outstanding futures contracts covering 7.5 million pounds of coffee with a fair market value of $3.4 million, gross of tax. At September 28, 2013, we held outstanding futures contracts covering 28.6 million pounds of coffee with a fair market value of $(3.8) million, gross of tax. Purchase commitments hedged with financial instruments are classified as fixed in the table above.

At September 27, 2014, we are exposed to approximately $47.2 million in unhedged green coffee purchase commitments that do not have a fixed price as compared to $40.1 million in unhedged green coffee purchase commitments that did not have a fixed price at September 28, 2013. A hypothetical 10% movement in the "C" price would increase or decrease our financial commitment for these purchase commitments outstanding at September 27, 2014 by approximately $4.7 million.

We are also subject to commodity price risk as our manufacturing and transportation costs are affected by various market factors including the availability of supplies of particular forms of energy and energy prices, as well as price risk for utilities and various manufacturing inputs which are used in our manufacturing operations. Derivative instruments have not been used to manage these risks.

Foreign currency exchange rate risk

Presently, our foreign operations are primarily related to our Canada segment, which is subject to risks, including, but not limited to, unique economic conditions, changes in political climate, differing tax structures, other regulations and restrictions, and foreign exchange rate volatility. Accordingly, our future results could be materially adversely affected by changes in these or other factors. We also source our green coffee, certain production equipment, and components of our brewers and manufacturing of our brewers from countries outside the United States, which are subject to the same risks described for Canada above; however, most of our green coffee and brewer purchases are transacted in the United States dollar.

The majority of the transactions conducted by our Canada segment are in the Canadian dollar. As a result, our revenues are adversely affected when the United States dollar strengthens against the Canadian dollar and are positively affected when the United States dollar weakens against the Canadian dollar. Conversely, our expenses are positively affected when the United States dollar strengthens against the Canadian dollar and adversely affected when the United States dollar weakens against the Canadian dollar.

As described in Note 11, Derivative Financial Instruments, in the Notes to Consolidated Financial Statements contained in Item 8 of this Annual Report on Form 10-K, from time to time we engage in transactions involving various derivative instruments to mitigate our foreign currency rate exposures. More specifically, we hedge, on a net basis, the foreign currency exposure of a portion of our assets and liabilities that are denominated in Canadian dollars. These contracts are recorded at fair value and are not designated as hedging instruments for accounting purposes. As a result, the changes in fair value are recognized in the Gain (loss) on financial instruments, net line in the Consolidated Statements of Operations. We do not engage in speculative transactions, nor do we hold derivative instruments for trading purposes.

At September 27, 2014 we had approximately one year remaining on a 5-year cross-currency swap of CDN $90.0 million that was not designated as a hedging instrument for accounting purposes, which largely offsets the financial impact of the re-measurement of an inter-company note receivable denominated in Canadian dollars for the same amount. Principal payments on the cross-currency swap are settled on an annual basis to match the repayments on the note receivable and the cross-currency swap is adjusted to fair value each period. Increases or

50

decreases in the cross-currency swap are generally offset by corresponding decreases or increases in the U.S. dollar value of the Canadian dollar inter-company note.

We occasionally use foreign currency forward contracts to hedge certain capital purchase liabilities for production equipment with the objective of minimizing cost risk due to market fluctuations. We designate these contracts as fair value hedges and measure the effectiveness of these derivative instruments at each balance sheet date. The changes in the fair value of these instruments along with the changes in the fair value of the hedged liabilities are recognized in net gains or losses on foreign currency on the consolidated statements of operations. We had no outstanding foreign currency forward contracts designated as fair value hedges at September 27, 2014. In addition, we use foreign currency forward contracts to hedge the purchase and payment of certain green coffee purchase commitments. We designate these contracts as cash flow hedges and measure the effectiveness at each balance sheet date. The changes in the fair value of these instruments are classified in accumulated other comprehensive income (loss). The gains or losses on these instruments are reclassified from other comprehensive income into earnings in the same period or periods during which the hedged transaction affects earnings. If it is determined that a derivative is not highly effective, the gain or loss is reclassified into earnings. We had outstanding foreign currency forward contracts designated as cash flow hedges with a notional value of $0.1 million at September 27, 2014.

Movements in foreign currency exchange rates exposes us to market risk resulting from the re-measurement of our net assets that are denominated in a currency different from the functional currency of the entity in which they are held. The market risk associated with the foreign currency exchange rate movements on foreign exchange contracts is expected to mitigate the market risk of the underlying obligation being hedged. Our net unhedged assets (liabilities) denominated in a currency other than the functional currency were approximately $122.4 million at September 27, 2014. Based on our net unhedged assets that are affected by movements in foreign currency exchange rates as of September 27, 2014, a hypothetical 10% movement in the foreign currency exchange rate would increase or decrease net assets (liabilities) by approximately $12.2 million with a corresponding charge to operations. In addition, at September 27, 2014, our net investment in our foreign subsidiaries with a functional currency different from our reporting currency was approximately $638.4 million. A hypothetical 10% movement in the foreign currency exchange rate would increase or decrease our net investment in our foreign subsidiaries by approximately $63.8 million with a corresponding charge to other comprehensive income.

51

Item 8.    Financial Statements and Supplementary Data

	Page
Index to Consolidated Financial Statements		52
Report of Independent Registered Public Accounting Firm		53
Consolidated Balance Sheets as of September 27, 2014 and September 28, 2013		54
Consolidated Statements of Operations for each of the three years in the period ended September 27, 2014		55
Consolidated Statements of Comprehensive Income for each of the three years in the period ended September 27, 2014		56
Consolidated Statements of Changes in Stockholders' Equity for each of the three years in the period ended September 27, 2014		57
Consolidated Statements of Cash Flows for each of the three years in the period ended September 27, 2014		58
Notes to Consolidated Financial Statements		60
Financial Statement Schedule—Schedule II—Valuation and Qualifying Accounts		106

52

Report of Independent Registered Public Accounting Firm

To the Board of Directors and the Stockholders of Keurig Green Mountain, Inc.

In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all material respects, the financial position of Keurig Green Mountain, Inc. and its subsidiaries at September 27, 2014 and September 28, 2013, and the results of their operations and their cash flows for each of the three years in the period ended September 27, 2014 in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedule listed in the accompanying index presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of September 27, 2014, based on criteria established in Internal Control—Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management is responsible for these financial statements and financial statement schedules, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in Management's Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on these financial statements, on the financial statement schedule, and on the Company's internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ PricewaterhouseCoopers LLP

Boston, Massachusetts
November 19, 2014

53

Keurig Green Mountain, Inc.

Consolidated Balance Sheets
(Dollars in thousands)

	September 27, 2014			September 28, 2013
Assets
Current assets:
Cash and cash equivalents	$	761,214		$	260,092
Restricted cash and cash equivalents		378			560
Short-term investment		100,000			—
Receivables, less uncollectible accounts and return allowances of $66,120 and $33,640 at September 27, 2014 and September 28, 2013, respectively		621,451			467,976
Inventories		835,167			676,089
Income taxes receivable		—			11,747
Other current assets		69,272			46,891
Deferred income taxes, net		58,038			58,137
Total current assets		2,445,520			1,521,492
Fixed assets, net		1,171,425			985,563
Intangibles, net		365,444			435,216
Goodwill		755,895			788,184
Deferred income taxes, net		131			149
Other long-term assets		58,892			30,944
Total assets	$	4,797,307		$	3,761,548
Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt	$	19,077		$	12,929
Current portion of capital lease and financing obligations		2,226			1,760
Accounts payable		411,107			312,170
Accrued expenses		305,677			242,427
Income tax payable		53,586			—
Dividend payable		40,580			—
Deferred income taxes, net		340			233
Other current liabilities		10,395			27,544
Total current liabilities		842,988			597,063
Long-term debt, less current portion		140,937			160,221
Capital lease and financing obligations, less current portion		116,240			76,061
Deferred income taxes, net		202,936			252,867
Other long-term liabilities		23,085			28,721
Commitments and contingencies (See Notes 5 and 19)
Redeemable noncontrolling interests		12,440			11,045
Stockholders' equity:
Preferred stock, $0.10 par value: Authorized—1,000,000 shares; No shares issued or outstanding		—			—
Common stock, $0.10 par value: Authorized—500,000,000 shares; Issued and outstanding—162,318,246 and 150,265,809 shares at September 27, 2014 and September 28, 2013, respectively		16,232			15,026
Additional paid-in capital		1,808,881			1,387,322
Retained earnings		1,687,619			1,252,407
Accumulated other comprehensive (loss) income		(54,051	)		(19,185	)
Total stockholders' equity	$	3,458,681		$	2,635,570
Total liabilities and stockholders' equity	$	4,797,307		$	3,761,548

The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements.

54

Keurig Green Mountain, Inc.

Consolidated Statements of Operations
(Dollars in thousands except per share data)

	Fiscal years ended
	September 27, 2014			September 28, 2013			September 29, 2012
Net sales	$	4,707,680		$	4,358,100		$	3,859,198
Cost of sales		2,891,820			2,738,714			2,589,799
Gross profit		1,815,860			1,619,386			1,269,399
Selling and operating expenses		561,573			560,430			481,493
General and administrative expenses		307,046			293,729			219,010
Operating income		947,241			765,227			568,896
Other income, net		262			960			1,819
Gain (loss) on financial instruments, net		8,307			5,513			(4,945	)
(Loss) gain on foreign currency, net		(19,746	)		(12,649	)		7,043
Gain on sale of subsidiary		—			—			26,311
Interest expense		(11,691	)		(18,177	)		(22,983	)
Income before income taxes		924,373			740,874			576,141
Income tax expense		(326,959	)		(256,771	)		(212,641	)
Net Income	$	597,414		$	484,103		$	363,500
Net income attributable to noncontrolling interests		896			871			872
Net income attributable to Keurig	$	596,518		$	483,232		$	362,628
Net income attributable to Keurig per common share:
Basic	$	3.80		$	3.23		$	2.34
Diluted	$	3.74		$	3.16		$	2.28
Cash dividends declared per common share	$	1.00		$	—		$	—
Weighted-average common shares outstanding:
Basic		157,085,574			149,638,636			154,933,948
Diluted		159,568,342			152,801,493			159,075,646

The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements.

55

Keurig Green Mountain, Inc.

Consolidated Statements of Comprehensive Income
(Dollars in thousands)

	Fiscal years ended
	September 27, 2014									September 28, 2013									September 29, 2012
	Pre-tax			Tax (expense) benefit			After-tax			Pre-tax			Tax (expense) benefit			After-tax			Pre-tax			Tax (expense) benefit			After-tax
Net income							$	597,414								$	484,103								$	363,500
Other comprehensive income (loss):
Cash flow hedges:
Unrealized gains (losses) arising during the period	$	20,641		$	(8,307	)	$	12,334		$	(3,732	)	$	1,489		$	(2,243	)	$	(1,234	)	$	498		$	(736	)
Losses reclassified to net income		6,315			(2,556	)		3,759			1,484			(599	)		885			1,359			(549	)		810
Foreign currency translation adjustments		(52,068	)		—			(52,068	)		(28,742	)		—			(28,742	)		25,353			—			25,353
Other comprehensive (loss) income	$	(25,112	)	$	(10,863	)	$	(35,975	)	$	(30,990	)	$	890		$	(30,100	)	$	25,478		$	(51	)	$	25,427
Total comprehensive income								561,439									454,003									388,927
Total comprehensive (loss) income attributable to noncontrolling interests								(203	)								156									1,524
Total comprehensive income attributable to Keurig							$	561,642								$	453,847								$	387,403

The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements.

56

Keurig Green Mountain, Inc.

Consolidated Statements of Changes in Stockholders' Equity
For the three fiscal years in the period ended September 27, 2014 (Dollars in thousands)

	Common stock												Accumulated other comprehensive income (loss)
							Additional paid-in capital			Retained earnings						Stockholders' Equity
	Shares			Amount
Balance at September 24, 2011		154,466,463		$	15,447		$	1,499,616		$	411,727		$	(14,575	)	$	1,912,215
Options exercised		940,369			94			3,300			—			—			3,394
Issuance of common stock under employee stock purchase plan		301,971			30			8,668			—			—			8,698
Restricted stock awards and units		55,747			5			(5	)		—			—			—
Issuance of common stock under deferred compensation plan		37,005			4			(4	)		—			—			—
Repurchase of common stock		(3,120,700	)		(312	)		(76,158	)		—			—			(76,470	)
Stock compensation expense		—			—			17,868			—			—			17,868
Tax benefit from equity-based compensation plans		—			—			11,064			—			—			11,064
Deferred compensation expense		—			—			211			—			—			211
Adjustment of redeemable noncontrolling interests to redemption value		—			—			—			(3,155	)		—			(3,155	)
Other comprehensive income, net of tax		—			—			—			—			24,775			24,775
Net income		—			—			—			362,628			—			362,628
Balance at September 29, 2012		152,680,855		$	15,268		$	1,464,560		$	771,200		$	10,200		$	2,261,228
Options exercised		2,849,308			285			19,532			—			—			19,817
Issuance of common stock under employee stock purchase plan		343,678			34			9,926			—			—			9,960
Restricted stock awards and units		34,761			3			(3	)		—			—			—
Repurchase of common stock		(5,642,793	)		(564	)		(187,714	)		—			—			(188,278	)
Stock compensation expense		—			—			26,081			—			—			26,081
Tax benefit from equity-based compensation plans		—			—			54,706			—			—			54,706
Deferred compensation expense		—			—			234			—			—			234
Adjustment of redeemable noncontrolling interests to redemption value		—			—			—			(2,025	)		—			(2,025	)
Other comprehensive loss, net of tax		—			—			—			—			(29,385	)		(29,385	)
Net income		—			—			—			483,232			—			483,232
Balance at September 28, 2013		150,265,809		$	15,026		$	1,387,322		$	1,252,407		$	(19,185	)	$	2,635,570
Sale of common stock		18,091,139			1,809			1,346,605			—			—			1,348,414
Options exercised		1,872,448			187			27,930			—			—			28,117
Issuance of common stock under employee stock purchase plan		170,531			18			12,546			—			—			12,564
Restricted stock awards and units		56,911			6			(6	)		—			—			—
Repurchase of common stock		(8,138,592	)		(814	)		(1,051,616	)		—			—			(1,052,430	)
Stock compensation expense		—			—			30,673			—			—			30,673
Tax benefit from equity-based compensation plans		—			—			55,218			—			—			55,218
Deferred compensation expense		—			—			209			—			—			209
Adjustment of redeemable noncontrolling interests to redemption value		—			—			—			(2,368	)		—			(2,368	)
Cash dividends declared		—			—			—			(158,938	)		—			(158,938	)
Other comprehensive loss, net of tax		—			—			—			—			(34,866	)		(34,866	)
Net income		—			—			—		$	596,518			—			596,518
Balance at September 27, 2014		162,318,246			16,232			1,808,881			1,687,619			(54,051	)		3,458,681

The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements.

57

Keurig Green Mountain, Inc.

Consolidated Statements of Cash Flows
(Dollars in thousands)

	Fiscal years ended
	September 27, 2014			September 28, 2013			September 29, 2012
Cash flows from operating activities:
Net income	$	597,414		$	484,103		$	363,500
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of fixed assets		214,607			183,814			135,656
Amortization of intangibles		43,032			45,379			45,991
Amortization of deferred financing fees		5,651			7,125			6,050
Unrealized loss (gain) on foreign currency, net		15,196			9,159			(6,557	)
(Gain) loss on disposal of fixed assets		(602	)		(85	)		2,517
Gain on sale of subsidiary, excluding transaction costs		—			—			(28,914	)
Provision for doubtful accounts		1,782			689			3,197
Provision for sales returns		114,057			79,747			107,436
(Gain) loss on derivatives, net		(1,582	)		(4,507	)		6,310
Excess tax benefits from equity-based compensation plans		(55,444	)		(54,699	)		(12,070	)
Deferred income taxes		(52,708	)		(17,701	)		60,856
Deferred compensation and stock compensation		30,882			26,315			18,079
Other		4,826			844			(672	)
Changes in assets and liabilities
Receivables		(274,884	)		(187,221	)		(159,317	)
Inventories		(166,473	)		87,677			(92,862	)
Income tax payable/receivable, net		120,553			46,290			16,457
Other current assets		(838	)		(12,668	)		(6,900	)
Other long-term assets, net		3,162			3,915			(469	)
Accounts payable and accrued expenses		133,818			133,532			17,125
Other current liabilities		(7,521	)		3,100			(2,718	)
Other long-term liabilities		(5,495	)		1,161			5,090
Net cash provided by operating activities		719,433			835,969			477,785
Cash flows from investing activities:
Change in restricted cash		182			3,005			(2,875	)
Purchase of short-term investment		(100,000	)		—			—
Purchase of long-term investment		(35,905	)		—			—
Proceeds from the sale of subsidiary, net of cash retained		—			—			137,733
Capital expenditures for fixed assets		(337,860	)		(232,780	)		(401,121	)
Other investing activities		1,164			4,208			618
Net cash used in investing activities		(472,419	)		(225,567	)		(265,645	)

58

Keurig Green Mountain, Inc.

Consolidated Statements of Cash Flows—(Continued)
(Dollars in thousands)

	Fiscal years ended
	September 27, 2014			September 28, 2013			September 29, 2012
Cash flows from financing activities:
Net change in revolving line of credit		—			(226,210	)		(108,727	)
Proceeds from issuance of common stock under compensation plans		40,681			29,777			12,092
Proceeds from issuance of common stock for private placement		1,348,414			—			—
Repurchase of common stock		(1,052,430	)		(188,278	)		(76,470	)
Excess tax benefits from equity-based compensation plans		55,444			54,699			12,070
Payments on capital lease and financing obligations		(1,931	)		(8,288	)		(7,558	)
Proceeds from borrowings of long-term debt		403			—			—
Repayment of long-term debt		(13,361	)		(71,620	)		(7,814	)
Dividends paid		(118,358	)		—			—
Purchase of noncontrolling interest		(4,752	)		—			—
Other financing activities		(1,124	)		(1,406	)		3,283
Net cash provided by (used in) financing activities		252,986			(411,326	)		(173,124	)
Change in cash balances included in current assets held for sale		—			—			5,160
Effect of exchange rate changes on cash and cash equivalents		1,122			2,727			1,124
Net increase in cash and cash equivalents		501,122			201,803			45,300
Cash and cash equivalents at beginning of period		260,092			58,289			12,989
Cash and cash equivalents at end of period	$	761,214		$	260,092		$	58,289
Supplemental disclosures of cash flow information:
Cash paid for interest	$	12,043		$	9,129		$	20,783
Cash paid for income taxes	$	270,367		$	223,580		$	136,407
Dividends declared not paid at the end of each period	$	40,580		$	—		$	—
Fixed asset purchases included in accounts payable and not disbursed at the end of each year	$	64,202		$	30,541		$	56,127
Noncash financing and investing activity:
Fixed assets acquired under capital lease and financing obligations	$	40,125		$	27,791		$	66,531
Settlement of acquisition-related liabilities through release of restricted cash	$	—		$	9,227		$	18,788

The accompanying Notes to Consolidated Financial Statements are an integral part of these financial statements.

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Keurig Green Mountain, Inc.

Notes to Consolidated Financial Statements

1.     Nature of Business and Organization

Keurig Green Mountain, Inc. (together with its subsidiaries, "the Company") is a leader in the specialty coffee and coffeemaker businesses. Keurig Green Mountain, Inc. is a Delaware corporation.

The Company manages its operations through two business segments, its United States operations within the Domestic segment and its Canadian operations within the Canada segment. The Company distributes its products in two channels: at-home ("AH") and away-from-home ("AFH").

The Domestic segment sells brewers, accessories, and sources, produces and sells coffee, hot cocoa, teas and other beverages in K-Cup®, Vue®, Rivo®, K-Carafe™ and Bolt™ packs ("portion packs") and coffee in more traditional packaging including bags and fractional packs to retailers including supermarkets, department stores, mass merchandisers, club stores, and convenience stores; to restaurants, hospitality accounts, office coffee distributors, and partner brand owners; and to consumers through Company websites. Substantially all of the Domestic segment's distribution to major retailers is processed by fulfillment entities which receive and fulfill sales orders and invoice certain retailers primarily in the AH channel. The Domestic segment also earns royalty income from portion packs sold by a third-party licensed roaster.

The Canada segment sells brewers, accessories, and sources, produces and sells coffee and teas and other beverages in portion packs and coffee in more traditional packaging including bags, cans and fractional packs under a variety of brands to retailers including supermarkets, department stores, mass merchandisers, club stores, through office coffee services to offices, convenience stores, restaurants, hospitality accounts, and to consumers through its website. The Canada segment included Filterfresh through October 3, 2011, the date of sale (see Note 3, Divestitures).

The Company's fiscal year ends on the last Saturday in September. Fiscal years 2014, 2013 and 2012 represent the years ended September 27, 2014, September 28, 2013 and September 29, 2012, respectively. Fiscal years 2014 and 2013 each consist of 52 weeks and fiscal 2012 consists of 53 weeks.

2.     Significant Accounting Policies

Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Company to make estimates and assumptions that affect amounts reported in the accompanying Consolidated Financial Statements. Significant estimates and assumptions by management affect the Company's inventory, deferred tax assets, allowance for sales returns, warranty reserves and certain accrued expenses, goodwill, intangible and long-lived assets and stock-based compensation.

Although the Company regularly assesses these estimates, actual results could differ from these estimates. Changes in estimates are recorded in the period they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances.

Principles of Consolidation

The Consolidated Financial Statements include the accounts of the Company and all of the entities in which the Company has a controlling financial interest, most often because the Company

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Notes to Consolidated Financial Statements—(Continued)

holds a majority voting/ownership interest. All intercompany transactions and accounts are eliminated in consolidation.

Noncontrolling Interests

Noncontrolling interests ("NCI") are evaluated by the Company and are shown as either a liability, temporary equity (shown between liabilities and equity) or as permanent equity depending on the nature of the redeemable features at amounts based on formulas specific to each entity. Generally, mandatorily redeemable NCI's are classified as liabilities and non-mandatorily redeemable NCI's are classified outside of shareholders' equity in the Consolidated Balance Sheets as temporary equity under the caption, Redeemable noncontrolling interests, and are measured at their redemption values at the end of each period. If the redemption value is greater than the carrying value, an adjustment is recorded in retained earnings to record the NCI at its redemption value. Redeemable NCIs that are mandatorily redeemable are classified as a liability in the Consolidated Balance Sheets under either Other current liabilities or Other long-term liabilities, depending on the remaining duration until settlement, and are measured at the amount of cash that would be paid if settlement occurred at the balance sheet date with any change from the prior period recognized as interest expense. See Note 8, Noncontrolling Interests in the Consolidated Financial Statements included in this Annual Report for further information.

Net income attributable to NCIs reflects the portion of the net income (loss) of consolidated entities applicable to the NCI shareholders in the accompanying Consolidated Statements of Operations. The net income attributable to NCIs is classified in the Consolidated Statements of Operations as part of consolidated net income and deducted from total consolidated net income to arrive at the net income attributable to the Company.

If a change in ownership of a consolidated subsidiary results in a loss of control or deconsolidation, any retained ownership interests are remeasured with the gain or loss reported to net earnings.

Business Combinations

The Company uses the acquisition method of accounting for business combinations and recognizes assets acquired and liabilities assumed measured at their fair values on the date acquired. Goodwill represents the excess of the purchase price over the fair value of the net assets. The fair values of the assets and liabilities acquired are determined based upon the Company's valuation. The valuation involves making significant estimates and assumptions which are based on detailed financial models including the projection of future cash flows, the weighted average cost of capital and any cost savings that are expected to be derived in the future.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents include money market funds which are carried at cost, plus accrued interest, which approximates fair value. The Company does not believe that it is subject to any unusual credit or market risk.

Restricted Cash and Cash Equivalents

Restricted cash and cash equivalents represents cash that is not available for use in our operations. The Company had restricted cash and cash equivalents of $0.4 million and $0.6 million as of September 27, 2014 and September 28, 2013, respectively.

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Notes to Consolidated Financial Statements—(Continued)

Short-Term Investments

The Company considers all investments purchased with an original maturity of more than three months but less than one year to be short-term investments. The short-term investment balance as of September 27, 2014 represents a certificate of deposit that the Company has the intent and ability to hold to maturity. It is therefore classified as held-to-maturity and carried at amortized cost. The fair value of this instrument is equal to its amortized cost and therefore there are no unrealized gains or losses associated with the instrument.

Allowance for Doubtful Accounts

A provision for doubtful accounts is provided based on a combination of historical experience, specific identification and customer credit risk where there are indications that a specific customer may be experiencing financial difficulties.

Inventories

Inventories consist primarily of green and roasted coffee, including coffee in portion packs, purchased finished goods such as coffee brewers, and packaging materials. Inventories are stated at the lower of cost or market. Cost is being measured using an adjusted standard cost method which approximates FIFO (first-in, first-out). The Company regularly reviews whether the net realizable value of its inventory is lower than its carrying value. If the valuation shows that the net realizable value is lower than the carrying value, the Company takes a charge to cost of sales and directly reduces the carrying value of the inventory.

The Company estimates any required write downs for inventory obsolescence by examining its inventories on a quarterly basis to determine if there are indicators that the carrying values exceed net realizable value. Indicators that could result in additional inventory write downs include age of inventory, damaged inventory, slow moving products and products at the end of their life cycles. While management believes that inventory is appropriately stated at the lower of cost or market, significant judgment is involved in determining the net realizable value of inventory.

Financial Instruments

The Company enters into various types of financial instruments in the normal course of business. Fair values are estimated based on assumptions concerning the amount and timing of estimated future cash flows and assumed discount rates reflecting varying degrees of perceived risk. Cash, cash equivalents, short-term investments, accounts receivable, accounts payable and accrued expenses are reported at carrying value and approximate fair value due to the short maturity of these instruments. Long-term debt is also reported at carrying value, which approximates fair value due to the fact that the interest rate on the debt is based on variable interest rates.

The fair values of derivative financial instruments have been determined using market information and valuation methodologies. Changes in assumptions or estimates could affect the determination of fair value; however, management does not believe any such changes would have a material impact on the Company's financial condition, results of operations or cash flows. The fair values of short-term investments and derivative financial instruments are disclosed in Note 12, Fair Value Measurements, in the Consolidated Financial Statements included in this Annual Report.

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Keurig Green Mountain, Inc.

Notes to Consolidated Financial Statements—(Continued)

Derivative Instruments

The Company enters into over-the-counter derivative contracts based on coffee futures ("coffee futures") to hedge against price increases in price-to-be-coffee purchase commitments and anticipated coffee purchases. Coffee purchases are generally denominated in the U.S. dollar. The Company also enters into interest rate swap agreements to mitigate interest rate risk associated with the Company's variable-rate borrowings and foreign currency forward contracts to hedge the purchase and payment of certain green coffee purchase commitments as well as certain recognized liabilities in currencies other than the Company's functional currency. All derivatives are recorded at fair value. Interest rate swaps, coffee futures, and certain foreign currency forward contracts which hedge the purchase and payment of green coffee purchase commitments are designated as cash flow hedges with the effective portion of the change in the fair value of the derivative instrument recorded as a component of other comprehensive income ("OCI") and subsequently reclassified into net earnings when the hedged exposure affects net earnings. Foreign currency forward contracts which hedge certain recognized liabilities denominated in non-functional currencies are designated as fair value hedges with the changes in the fair value of these instruments along with the changes in the fair value of the hedged liabilities recognized in gain or loss on foreign currency, net in the Consolidated Statements of Operations.

Effectiveness is determined by how closely the changes in the fair value of the derivative instrument offset the changes in the fair value of the hedged item. The ineffective portion of the change in the fair value of the derivative instrument is recorded directly to earnings.

The Company formally documents hedging instruments and hedged items, and measures at each balance sheet date the effectiveness of its hedges. When it is determined that a derivative is not highly effective, the derivative expires, or is sold or terminated, or the derivative is discontinued because it is unlikely that a forecasted transaction will occur, the Company discontinues hedge accounting prospectively for that specific hedge instrument.

The Company also occasionally enters into certain foreign currency forward contracts to hedge certain exposures that are not designated as hedging instruments for accounting purposes. These contracts are recorded at fair value, with the changes in fair value recognized in the Consolidated Statements of Operations.

The Company does not engage in speculative transactions, nor does it hold derivative instruments for trading purposes. See Note 11, Derivative Financial Instruments and Note 14, Stockholders' Equity in the Consolidated Financial Statements included in this Annual Report for further information.

Deferred Financing Costs

Deferred financing costs consist primarily of commitment fees and loan origination fees and are being amortized over the respective life of the applicable debt using a method that approximates the effective interest rate method. Deferred financing costs included in Other long-term assets in the accompanying Consolidated Balance Sheets as of September 27, 2014 and September 28, 2013 were $9.6 million and $15.2 million, respectively.

Goodwill and Intangibles

Goodwill is tested for impairment annually at the end of the Company's fiscal year or whenever events or changes in circumstances indicate that the carrying value may not be

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Notes to Consolidated Financial Statements—(Continued)

recoverable. Goodwill is assigned to reporting units for purposes of impairment testing. A reporting unit is the same as an operating segment or one level below an operating segment. The Company may assess qualitative factors to determine if it is more likely than not (i.e., a likelihood of more than 50%) that the fair value of a reporting unit is less than its carrying amount, including goodwill. If the Company determines that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, no further testing is necessary. If, however, the Company determines that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the Company performs the first step of a two-step goodwill impairment test. The assessment of qualitative factors is optional and at the Company's discretion. The Company may bypass the qualitative assessment for any reporting unit in any period and perform the first step of the quantitative goodwill impairment test. The Company may resume performing the qualitative assessment in any subsequent period. The first step is a comparison of each reporting unit's fair value to its carrying value. The Company estimates fair value based on discounted cash flows. The reporting unit's discounted cash flows require significant management judgment with respect to sales forecasts, gross margin percentages, selling, operating, general and administrative ("SG&A") expenses, capital expenditures and the selection and use of an appropriate discount rate. The projected sales, gross margin and SG&A expense rate assumptions and capital expenditures are based on the Company's annual business plan or other forecasted results. Discount rates reflect market-based estimates of the risks associated with the projected cash flows directly resulting from the use of those assets in operations. The estimates of fair value of reporting units are based on the best information available as of the date of the assessment. If the carrying value of a reporting unit exceeds its estimated fair value in the first step, a second step is performed, which requires the Company to allocate the fair value of the reporting unit derived in the first step to the fair value of the reporting unit's net assets, with any fair value in excess of amounts allocated to such net assets representing the implied fair value of goodwill for that reporting unit. If the implied fair value of the goodwill is less than the book value, goodwill is impaired and is written down to the implied fair value amount.

Intangible assets that have finite lives are amortized over their estimated economic useful lives on a straight line basis. Intangible assets that have indefinite lives are not amortized and are tested for impairment annually or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Similar to the qualitative assessment for goodwill, the Company may assess qualitative factors to determine if it is more likely than not (i.e., a likelihood of more than 50%) that the fair value of the indefinite-lived intangible asset is less than its carrying amount. If the Company determines that it is not more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount, no further testing is necessary. If, however, the Company determines that it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount, the Company compares the fair value of the indefinite-lived asset with its carrying amount. If the carrying value of an individual indefinite-lived intangible asset exceeds its fair value, the individual indefinite-lived intangible asset is written down by an amount equal to such excess. The assessment of qualitative factors is optional and at the Company's discretion. The Company may bypass the qualitative assessment for any indefinite-lived intangible asset in any period and resume performing the qualitative assessment in any subsequent period.

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Notes to Consolidated Financial Statements—(Continued)

Impairment of Long-Lived Assets

When facts and circumstances indicate that the carrying values of long-lived assets, including fixed assets, may be impaired, an evaluation of recoverability is performed by comparing the carrying value of the assets, at an asset group level, to undiscounted projected future cash flows in addition to other quantitative and qualitative analyses. When assessing impairment, property, plant and equipment assets are grouped at the lowest level for which there are identifiable cash flows that are largely independent of other groups of assets. Upon indication that the carrying value of such assets may not be recoverable, the Company recognizes an impairment loss as a charge against current operations based upon an assessment of fair value of such assets. Long-lived assets to be disposed of are reported at the lower of the carrying amount or fair value, less estimated costs to sell. The Company makes judgments related to the expected useful lives of long-lived assets and its ability to realize undiscounted cash flows in excess of the carrying amounts of such assets which are affected by factors such as the ongoing maintenance and improvements of the assets, changes in economic conditions and changes in operating performance.

Fixed Assets

Fixed assets are carried at cost, net of accumulated depreciation. Expenditures for maintenance, repairs and renewals of minor items are expensed as incurred. Expenditures for refurbishments and improvements that significantly improve the productive capacity or extend the useful life of an asset are capitalized. Depreciation is calculated using the straight-line method over the assets' estimated useful lives. The cost and accumulated depreciation for fixed assets sold, retired, or otherwise disposed of are relieved from the accounts, and the resultant gains and losses are reflected in income.

The Company follows an industry-wide practice of purchasing and loaning coffee brewing and related equipment to wholesale customers. These assets are also carried at cost, net of accumulated depreciation.

Depreciation costs of manufacturing and distribution assets are included in cost of sales on the Consolidated Statements of Operations. Depreciation costs of other assets, including equipment on loan to customers, are included in selling and operating expenses on the Consolidated Statements of Operations.

Leases

Occasionally, the Company is involved in the construction of leased properties. Due to the extent and nature of that involvement, the Company is deemed the owner during the construction period and is required to capitalize the construction costs on the Consolidated Balance Sheets along with a corresponding financing obligation for the project costs that are incurred by the lessor. Upon completion of the project, a sale-leaseback analysis is performed to determine if the Company can record a sale to remove the assets and related obligation and record the lease as either an operating or capital lease obligation. If the Company is precluded from derecognizing the assets when construction is complete due to continuing involvement beyond a normal leaseback, the lease is accounted for as a financing transaction and the recorded asset and related financing obligation remain on the Consolidated Balance Sheet. Accordingly, the asset is depreciated over its estimated useful life in accordance with the Company's policy. If the Company is not considered the owner of the land, a portion of the lease payments is allocated to ground rent and treated as an operating lease. The portion of the lease payment allocated to ground rental expense is based on the fair value of the land at the commencement of construction. Lease payments allocated to the buildings are

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Notes to Consolidated Financial Statements—(Continued)

recognized as reductions to the financing obligation and interest expense. See Note 19, Commitments and Contingencies, for further information.

Leases that qualify as capital leases are recorded at the lower of the fair value of the asset or the present value of the future minimum lease payments over the lease term generally using the Company's incremental borrowing rate. Assets leased under capital leases are included in fixed assets and generally are depreciated over the lease term. Lease payments under capital leases are recognized as a reduction of the capital lease obligation and interest expense.

All other leases are considered operating leases. Assets subject to an operating lease are not recorded on the balance sheet. Lease payments are recognized on a straight-line basis as rent expense over the expected lease term.

Revenue Recognition

Revenue from sales of brewer systems, coffee and other specialty beverages in portion packs, and coffee in more traditional packaging including whole bean and ground coffee selections in bags and ground coffee in fractional packs is recognized when title and risk of loss passes to the customer, which generally occurs upon shipment or delivery of the product to the customer as defined by the contractual shipping terms. Shipping charges billed to customers are also recognized as revenue, and the related shipping costs are included in cost of sales. Cash received in advance of product delivery is recorded in deferred revenue, which is included in other current liabilities on the accompanying Consolidated Balance Sheets, until earned.

The majority of the Company's distribution to major retailers is processed by fulfillment entities. The fulfillment entities receive and fulfill sales orders and invoice certain retailers. All product shipped by the Company to the fulfillment entities are owned by the Company and included in inventories on the accompanying consolidated balance sheets. The Company recognizes revenue when delivery of the product from the fulfillment entity to the retailer has occurred based on the contractual shipping terms and when all other revenue recognition criteria are met.

Sales of brewers, portion packs and other products are recognized net of any discounts, returns, allowances and sales incentives, including coupon redemptions and rebates. The Company estimates the allowance for returns using an average return rate based on historical experience and an evaluation of contractual rights or obligations. The Company routinely participates in trade promotion programs with customers, including customers whose sales are processed by the fulfillment entities, whereby customers can receive certain incentives and allowances which are recorded as a reduction to sales when the sales incentive is offered and committed to or, if the incentive relates to specific sales, at the later of when that revenue is recognized or the date at which the sales incentive is offered. These incentives include, but are not limited to, cash discounts and volume based incentive programs. Allowances to customers that are directly attributable and supportable by customer promotional activities are recorded as selling expenses at the time the promotional activity occurs.

Roasters licensed by the Company to manufacture and sell portion packs, both to the Company for resale and to their other coffee customers, are obligated to pay a royalty to the Company upon shipment to their customer. The Company records royalty revenue upon shipment of portion packs by licensed roasters to third-party customers as set forth under the terms and conditions of various licensing agreements. For shipments of portion packs to the Company for resale, this royalty payment is recorded as a reduction

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Notes to Consolidated Financial Statements—(Continued)

to the carrying value of the related portion packs in inventory and as a reduction to cost of sales when sold through to third-party customers by the Company.

Cost of Sales

Cost of sales for the Company consists of the cost of raw materials including coffee beans, hot cocoa, flavorings and packaging materials; a portion of our rental expense; production, warehousing and distribution costs which include salaries; distribution and merchandising personnel; leases and depreciation on facilities and equipment used in production; the cost of brewers manufactured by suppliers; third-party fulfillment charges; receiving, inspection and internal transfer costs; warranty expense; freight, duties and delivery expenses; and certain third-party royalty charges. All shipping and handling expenses are also included as a component of cost of sales.

Product Warranty

The Company provides for the estimated cost of product warranties in cost of sales, at the time product revenue is recognized. Warranty costs are estimated primarily using historical warranty information in conjunction with current engineering assessments applied to the Company's expected repair or replacement costs. The estimate for warranties requires assumptions relating to expected warranty claims which can be impacted significantly by quality issues.

Advertising Costs

The Company expenses the costs of advertising the first time the advertising takes place, except for direct mail campaigns targeted directly at consumers, which are expensed over the period during which they are expected to generate sales. As of September 27, 2014 and September 28, 2013, prepaid advertising costs of $3.3 million and $4.1 million, respectively, were recorded in Other current assets in the accompanying Consolidated Balance Sheets. Advertising expense totaled $137.2 million, $193.2 million, and $147.7 million, for fiscal years 2014, 2013, and 2012, respectively.

Income Taxes

The Company recognizes deferred tax assets and liabilities for the expected future tax benefits or consequences of temporary differences between the financial statement carrying amounts of existing assets and liabilities, and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Judgment is required in determining the provision for income taxes and related accruals, deferred tax assets and liabilities. These include establishing a valuation allowance related to the ability to realize certain deferred tax assets. The Company currently believes that future earnings and current tax planning strategies will be sufficient to recover substantially all of the Company's recorded net deferred tax assets. To the extent future taxable income against which these assets may be applied is not sufficient, some portion or all of our recorded deferred tax assets would not be realizable.

Accounting for uncertain tax positions also requires significant judgments, including estimating the amount, timing and likelihood of ultimate settlement. Although the Company believes that its estimates are reasonable, actual results could differ from these estimates. The Company uses a more-likely-than-not measurement attribute for all tax positions taken or expected to be taken on a tax return in order for those tax positions to be recognized in the financial statements.

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Notes to Consolidated Financial Statements—(Continued)

Stock-Based Compensation

The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. Equity awards consist of stock options, restricted stock units ("RSUs"), restricted stock awards ("RSAs"), and performance stock units ("PSUs"). The cost is recognized over the period during which an employee is required to provide service in exchange for the award.

The Company measures the fair value of stock options using the Black-Scholes model and certain assumptions, including the expected life of the stock options, an expected forfeiture rate and the expected volatility of its common stock. The expected life of options is estimated based on options vesting periods, contractual lives and an analysis of the Company's historical experience. The expected forfeiture rate is based on the Company's historical employee turnover experience and future expectations. The risk-free interest rate is based on the U.S. Treasury rate over the expected life. The Company uses a blended historical volatility to estimate expected volatility at the measurement date. The fair value of RSUs, RSAs and PSUs is based on the closing price of the Company's common stock on the grant date.

Foreign Currency Translation and Transactions

The financial statements of the Company's foreign subsidiaries are translated into the reporting currency of the Company which is the U.S. dollar. The functional currency of certain of the Company's foreign subsidiaries is the local currency of the subsidiary. Accordingly, the assets and liabilities of the Company's foreign subsidiaries are translated into U.S. dollars using the exchange rate in effect at each balance sheet date. Revenue and expense accounts are generally translated using the average rate of exchange during the period. Foreign currency translation adjustments are accumulated as a component of other comprehensive income or loss as a separate component of stockholders' equity. Gains and losses arising from transactions denominated in currencies other than the functional currency of the entity are charged directly against earnings in the Consolidated Statement of Operations. Gains and losses arising from transactions denominated in foreign currencies are primarily related to inter-company loans that have been determined to be temporary in nature, cash, long-term debt and accounts payable denominated in non-functional currencies.

Significant Customer Credit Risk and Supply Risk

The majority of the Company's customers are located in the U.S. and Canada. With the exception of M.Block & Sons ("MBlock") as described below, concentration of credit risk with respect to accounts receivable is limited due to the large number of customers in various channels comprising the Company's customer base. The Company does not require collateral from customers as ongoing credit evaluations of customers' payment histories are performed. The Company maintains reserves for potential credit losses and such losses, in the aggregate, have not exceeded management's expectations.

The Company procures the majority of the brewers it sells from one third-party brewer manufacturer. Purchases from this brewer manufacturer amounted to approximately $735.2 million, $637.0 million and $721.3 million in fiscal years 2014, 2013 and 2012, respectively.

The Company primarily relies on MBlock to process the majority of sales orders for our AH business with retailers in the United States. The Company is subject to significant credit risk regarding the creditworthiness of MBlock and, in turn, the creditworthiness of

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Notes to Consolidated Financial Statements—(Continued)

the retailers. Sales processed by MBlock to retailers amounted to $1,706.1 million, $1,600.2 million and $1,458.4 million for fiscal years 2014, 2013 and 2012, respectively. The Company's account receivables due from MBlock amounted to $148.2 million and $157.4 million at September 27, 2014 and September 28, 2013, respectively.

Sales to customers that represented more than 10% of the Company's net sales included Wal-Mart Stores, Inc. and affiliates ("Wal-Mart"), representing approximately 17%, 14% and 12% of consolidated net sales for fiscal years 2014, 2013 and 2012 respectively; and Costco Wholesale Corporation and affiliates ("Costco"), representing approximately 12% and 11% of consolidated net sales for fiscal 2014 and 2013, respectively. For Wal-Mart, the majority of U.S. sales are processed through MBlock whereby MBlock is the vendor of record. Starting in fiscal 2012, for U.S. sales to Costco, the Company became the vendor of record and although the sales are processed through MBlock, the Company records the account receivables from the customer and pays MBlock for their fulfillment services. The Company's account receivables due from Costco amounted to $104.5 million and $65.7 million, net of allowances, at September 27, 2014 and September 28, 2013, respectively.

Research & Development

Research and development charges are expensed as incurred. These expenses amounted to $76.5 million, $57.7 million and $41.7 million in fiscal years 2014, 2013 and 2012, respectively. These costs primarily consist of salary and consulting expenses and are recorded in selling and operating expenses in each respective segment of the Company.

Recent Accounting Pronouncements

In August 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-15 "Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern," which requires management to assess whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern within one year after the financial statements are issued. If substantial doubt exists, additional disclosures are required. ASU 2014-15 will be effective for the Company in the fourth quarter of 2017. The adoption of ASU 2014-15 is not expected to have a material impact on the Company's disclosures.

In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers (Topic 606)" ("ASU 2014-09"). ASU 2014-09 supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition, and most industry-specific guidance. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard will require the Company to separate performance obligations within a contract, determine total transaction costs, and ultimately allocate the transaction costs across the established performance obligations. This ASU will become effective for the Company beginning in fiscal 2018 under either full or modified retrospective adoption, with early adoption not permitted. The Company is currently assessing the potential effects of these changes on the Company's net income, financial position, cash flows and disclosures.

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In April 2014, FASB issued ASU No. 2014-08, "Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity," which raises the threshold for disposals to qualify as discontinued operations ("ASU 2014-08"). A discontinued operation is defined as: (1) a component of an entity or group of components that has been disposed of or classified as held for sale and represents a strategic shift that has or will have a major effect on an entity's operations and financial results; or (2) an acquired business that is classified as held for sale on the acquisition date. ASU 2014-08 also requires additional disclosures regarding discontinued operations, as well as material disposals that do not meet the definition of discontinued operations. It is effective for annual periods beginning on or after December 15, 2014. Early adoption is permitted but only for disposals that have not been reported in financial statements previously issued. The adoption of ASU 2014-08 is not expected to have a material impact on the Company's net income, financial position, cash flows or disclosures.

In July 2013, the FASB issued ASU No. 2013-11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists" ("ASU 2013-11"). ASU 2013-11 was issued to eliminate diversity in practice regarding the presentation of unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. Under ASU 2013-11, an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. Otherwise, to the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The amendments in this ASU are effective prospectively for reporting periods beginning after December 15, 2013, and early adoption is permitted. The adoption of ASU 2013-11 in the first quarter of fiscal 2015 is not expected have an impact on the Company's net income, financial position or cash flows.

In March 2013, the FASB issued ASU No. 2013-05, "Foreign Currency Matters (Topic 830): Parent's Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity" ("ASU 2013-05"). ASU 2013-05 provides clarification regarding whether Subtopic 810-10, Consolidation—Overall, or Subtopic 830-30, Foreign Currency Matters—Translation of Financial Statements, applies to the release of cumulative translation adjustments into net income when a reporting entity either sells a part or all of its investment in a foreign entity or ceases to have a controlling financial interest in a subsidiary or group of assets that constitute a business within a foreign entity. The amendments in this ASU are effective prospectively for reporting periods beginning after December 15, 2013, and early adoption is permitted. The adoption of ASU 2013-05 in the first quarter of fiscal 2015 is not expected to have an impact on the Company's net income, financial position or cash flows.

In February 2013, the FASB issued ASU No. 2013-04, "Liabilities (Topic 405): Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date" ("ASU 2013-04"). ASU 2013-04

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Notes to Consolidated Financial Statements—(Continued)

provides guidance for the recognition, measurement and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this ASU is fixed at the reporting date. The guidance requires an entity to measure those obligations as the sum of the amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors as well as any additional amount the reporting entity expects to pay on behalf of its co-obligors. ASU 2013-04 also requires an entity to disclose the nature and amount of those obligations. The amendments in this ASU are effective for reporting periods beginning after December 15, 2013, with early adoption permitted. Retrospective application is required. The adoption of ASU 2013-04 in the first quarter of fiscal 2015 is not expected have an impact on the Company's net income, financial position, cash flows or disclosures.

3.     Divestitures

Fiscal 2012

On October 3, 2011, all the outstanding shares of Van Houtte USA Holdings, Inc., also known as the Van Houtte U.S. Coffee Service business or the "Filterfresh" business, were sold to ARAMARK Refreshment Services, LLC ("ARAMARK") in exchange for $149.5 million in cash. Approximately $4.4 million of cash was transferred to ARAMARK as part of the sale and $7.4 million was repaid to ARAMARK upon finalization of the purchase price, resulting in a net cash inflow related to the Filterfresh sale of $137.7 million. The Company recognized a gain on the sale of $26.3 million during the thirteen weeks ended December 24, 2011. Filterfresh had been included in the Canada segment.

Filterfresh revenues and net income included in the Company's consolidated statement of operations were as follows (dollars in thousands, except per share data):

	For the period September 25, 2011 through October 3, 2011 (date of sale)
Net sales	$	2,286
Net income	$	229
Less income attributable to noncontrolling interests		20
Net income attributable to Keurig	$	209
Diluted net income per share	$	—

After the disposition, the Company continues to sell coffee and brewers to Filterfresh, which prior to the sale of Filterfresh were eliminated and were not reflected in the Consolidated Statement of Operations. For fiscal 2012, the Company's sales to Filterfresh through October 3, 2011 (date of sale) that were eliminated in consolidation were $0.6 million.

4.     Segment Reporting

Segment information is prepared on the same basis that our CEO, who is our chief operating decision maker, manages the business, evaluates financial results, and makes key operating decisions. The structure includes a Domestic segment containing all U.S. Operations and immaterial operations related to international expansion, and a Canada segment containing all Canadian operations.

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For a description of the operating segments, see Note 1, Nature of Business and Organization.

Management evaluates the performance of the Company's operating segments based on several factors, including net sales to external customers and operating income. Net sales are recorded on a segment basis and intersegment sales are eliminated within the operating segment as part of the financial consolidation process. Operating income represents gross profit less selling, operating, general and administrative expenses. The Company's manufacturing operations occur within both the Domestic and Canada segments, and the costs of manufacturing are recognized in cost of sales in the operating segment in which the sale occurs. Information system technology services are mainly centralized while finance and accounting functions are primarily decentralized. Expenses consisting primarily of compensation and depreciation related to certain centralized administrative functions including information system technology are allocated to the operating segments.

Expenses not specifically related to an operating segment are presented under "Corporate Unallocated." Corporate Unallocated expenses are comprised mainly of the compensation and other related expenses of certain of the Company's senior executive officers and other selected employees who perform duties related to the entire enterprise. Corporate Unallocated expenses also include depreciation for corporate headquarters, sustainability expenses, interest expense not directly attributable to an operating segment, the majority of foreign exchange gains or losses, legal expenses and compensation of the Board of Directors. The Company does not disclose assets or property additions by segment as only consolidated asset information is provided to the CODM for use in decision making.

The following tables summarize selected financial data for segment disclosures for fiscal 2014, 2013 and 2012.

	For Fiscal 2014 (Dollars in thousands)
	Domestic		Canada		Corporate- Unallocated			Consolidated
Net sales	$	4,083,326	$	624,354	$	—		$	4,707,680
Operating income (loss)	$	1,016,577	$	102,605	$	(171,941	)	$	947,241
Depreciation and amortization	$	185,874	$	61,989	$	9,776		$	257,639
Stock compensation expense	$	14,071	$	2,729	$	13,873		$	30,673

	For Fiscal 2013 (Dollars in thousands)
	Domestic		Canada		Corporate- Unallocated			Consolidated
Net sales	$	3,725,008	$	633,092	$	—		$	4,358,100
Operating Income (loss)	$	826,092	$	87,674	$	(148,539	)	$	765,227
Depreciation and amortization	$	162,359	$	65,334	$	1,500		$	229,193
Stock compensation expense	$	9,909	$	2,519	$	13,653		$	26,081

	For Fiscal 2012 (Dollars in thousands)
	Domestic		Canada		Corporate- Unallocated			Consolidated
Net sales	$	3,233,674	$	625,524	$	—		$	3,859,198
Operating Income (loss)	$	576,949	$	76,198	$	(84,251	)	$	568,896
Depreciation and amortization	$	116,722	$	62,984	$	1,941		$	181,647
Stock compensation expense	$	7,808	$	1,890	$	8,170		$	17,868

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Notes to Consolidated Financial Statements—(Continued)

Geographic Information

Net sales are attributed to countries based on the location of the customer. Information concerning net sales of principal geographic areas is as follows (in thousands):

	Fiscal 2014		Fiscal 2013		Fiscal 2012
Net Sales:
United States	$	4,074,968	$	3,721,182	$	3,248,543
Canada		621,460		634,360		609,828
Other		11,252		2,558		827
	$	4,707,680	$	4,358,100	$	3,859,198

Sales to customers that represented more than 10% of the Company's net sales included Wal-Mart, representing approximately 17%, 14% and 12% of consolidated net sales for fiscal years 2014, 2013 and 2012, respectively, and Costco, representing approximately 12% and 11% of consolidated net sales for fiscal 2014 and 2013, respectively. Sales to Wal-Mart and Costco in fiscal years 2014, 2013 and 2012 were through both the Domestic and Canada segments.

Information concerning long-lived assets of principal geographic area is as follows (in thousands) as of:

	September 27, 2014		September 28, 2013
Fixed Assets, net:
United States	$	1,010,181	$	844,471
Canada		125,155		135,440
Other		36,089		5,652
	$	1,171,425	$	985,563

Net Sales by Major Product Category

Net sales by major product category (in thousands):

	Fiscal 2014		Fiscal 2013		Fiscal 2012
Portion Packs	$	3,604,539	$	3,187,350	$	2,708,886
Brewers and Accessories		822,271		827,570		759,805
Other Products and Royalties		280,870		343,180		390,507
	$	4,707,680	$	4,358,100	$	3,859,198

5.     Inventories

Inventories consisted of the following (in thousands) as of:

	September 27, 2014		September 28, 2013
Raw materials and supplies	$	169,858	$	182,882
Finished goods		665,309		493,207
	$	835,167	$	676,089

As of September 27, 2014, the Company had approximately $407.7 million in green coffee purchase commitments, of which approximately 88% had a fixed price. These commitments primarily extend through fiscal 2016. The value of the variable portion of these commitments was calculated using an average "C" price of coffee of $1.93 per pound at September 27, 2014. In addition to its green coffee commitments, the Company had approximately $256.4 million in fixed price brewer and related accessory purchase commitments and $1,108.7 million in production raw materials commitments at September 27, 2014. The Company believes, based on relationships established with its suppliers, that the risk of non-delivery on such purchase commitments is remote.

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Notes to Consolidated Financial Statements—(Continued)

As of September 27, 2014, minimum future inventory purchase commitments were as follows (in thousands):

Fiscal Year	Inventory Purchase Obligations(1)
2015		830,788
2016		252,623
2017		250,779
2018		263,039
2019		65,762
Thereafter		109,805
	$	1,772,796

⁽¹⁾

Certain purchase obligations are determined based on a contractual percentage of forecasted volumes.

6.     Fixed Assets

Fixed assets consisted of the following (in thousands) as of:

	Useful Life in Years		September 27, 2014			September 28, 2013
Production equipment		1-15	$	779,850		$	680,457
Coffee service equipment		3-7		61,029			59,169
Computer equipment and software		1-6		177,878			146,246
Land		Indefinite		12,767			11,520
Building and building improvements		4-30		238,945			134,495
Furniture and fixtures		1-15		36,899			33,975
Vehicles		4-5		13,032			11,786
Leasehold improvements		1-20 or remaining life of lease, whichever is less		95,373			98,990
Assets acquired under capital leases		5-15		41,200			41,200
Construction-in-progress				308,976			202,940
Total fixed assets			$	1,765,949		$	1,420,778
Accumulated depreciation				(594,524	)		(435,215	)
			$	1,171,425		$	985,563

Assets acquired under capital leases, net of accumulated amortization, were $34.1 million and $36.9 million at September 27, 2014 and September 28, 2013, respectively.

Total depreciation and amortization expense relating to all fixed assets was $214.6 million, $183.8 million and $135.7 million for fiscal years 2014, 2013, and 2012, respectively.

Assets classified as construction-in-progress are not depreciated, as they are not ready for productive use.

During fiscal years 2014, 2013 and 2012, $8.0 million, $6.1 million, and $2.8 million, respectively, of interest expense was capitalized.

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Notes to Consolidated Financial Statements—(Continued)

7.     Goodwill and Intangible Assets

The following represented the change in the carrying amount of goodwill by segment for fiscal 2014 and 2013 (in thousands):

	Domestic		Canada			Total
Balance as of September 29, 2012	$	369,353	$	438,723		$	808,076
Foreign currency effect		—		(19,892	)		(19,892	)
Balance as of September 28, 2013	$	369,353	$	418,831		$	788,184
Other	$	—	$	(233	)	$	(233	)
Foreign currency effect	$	—	$	(32,056	)	$	(32,056	)
Balance as of September 27, 2014	$	369,353	$	386,542		$	755,895

Indefinite-lived intangible assets included in the Canada operating segment consisted of the following (in thousands) as of:

	September 27, 2014		September 28, 2013
Trade names	$	90,257	$	97,740

The Company conducted its annual impairment test of goodwill and indefinite-lived intangible assets as of September 27, 2014, and elected to bypass the optional qualitative assessment and performed a quantitative impairment test. Goodwill was evaluated for impairment at the following reporting unit levels:

•

Domestic

•

Canada—Roasting and Retail

•

Canada—Coffee Services Canada

For the goodwill impairment test, the fair value of the reporting units was estimated using the Discounted Cash Flow ("DCF") method. A number of significant assumptions and estimates are involved in the application of the DCF method including discount rate, sales volume and prices, costs to produce and working capital changes. For the indefinite-lived intangible assets impairment test, the fair value of the trade name was estimated using the Relief-from-Royalty Method. This method estimates the savings in royalties the Company would otherwise have had to pay if it did not own the trade name and had to license the trade name from a third-party with rights of use substantially equivalent to ownership. The fair value of the trade name is the present value of the future estimated after-tax royalty payments avoided by ownership, discounted at an appropriate, risk-adjusted rate of return. For goodwill and indefinite-lived intangible impairment tests, the Company used a royalty rate of 3.0%, an income tax rate of 38.0% for the United States and 27.5% for Canada, and discount rates ranging from 13% to 14%. There was no material impairment of goodwill or indefinite-lived intangible assets in fiscal years 2014, 2013, or 2012.

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Notes to Consolidated Financial Statements—(Continued)

Intangible Assets Subject to Amortization

Definite-lived intangible assets consisted of the following (in thousands) as of:

			September 27, 2014					September 28, 2013
	Useful Life in Years		Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Acquired technology		4-10	$	16,501	$	(13,713	)	$	21,609	$	(17,123	)
Customer and roaster agreements		8-11		8,939		(5,303	)		26,977		(19,750	)
Customer relationships		2-16		390,563		(141,163	)		414,967		(113,061	)
Trade names		9-11		35,911		(16,548	)		37,200		(13,353	)
Non-compete agreements		2-5		—		—			374		(364	)
Total			$	451,914	$	(176,727	)	$	501,127	$	(163,651	)

Definite-lived intangible assets are amortized on a straight-line basis over the period of expected economic benefit. Total amortization expense was $43.0 million, $45.4 million, and $46.0 million for fiscal years 2014, 2013, and 2012, respectively. The weighted average remaining life for definite-lived intangibles at September 27, 2014 is 7.4 years.

The estimated aggregate amortization expense over each of the next five years and thereafter, is as follows (in thousands):

2015	40,452
2016	39,727
2017	38,331
2018	38,331
2019	38,231
Thereafter	80,115

8.     Noncontrolling Interests

The changes in the liability and temporary equity attributable to redeemable NCIs for the three fiscal years in the period ended September 27, 2014 are as follows (in thousands):

	Liability attributable to mandatorily redeemable noncontrolling interests			Equity attributable to redeemable noncontrolling interests
Balance at September 24, 2011	$	—		$	21,034
Disposition of noncontrolling interest		—			(10,331	)
Redeemable noncontrolling interest reclassified to other long-term liabilities		4,708			(4,708	)
Net income		60			812
Adjustment to redemption value		167			3,155
Cash distributions		(204	)		(513	)
Other comprehensive loss, net of tax		197			455
Balance at September 29, 2012	$	4,928		$	9,904
Net income		462			409
Adjustment to redemption value		372			2,025
Cash distributions		(583	)		(823	)
Other comprehensive loss, net of tax		(245	)		(470	)
Balance at September 28, 2013	$	4,934		$	11,045
Net income		344			552
Adjustment to redemption value		47			2,368
Cash distributions		(348	)		(651	)
Other comprehensive loss, net of tax		(225	)		(874	)
Purchase of noncontrolling interest		(4,752	)		—
Balance at September 27, 2014	$	—		$	12,440

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Notes to Consolidated Financial Statements—(Continued)

Mandatorily Redeemable Noncontrolling Interest

On June 22, 2012, the Company executed a Share Purchase and Sale Agreement under which the Company was required to purchase a noncontrolling interest holder's shares in an entity in which the Company held a controlling interest within 30 days of the end of the Company's third quarter of fiscal 2014. The mandatorily redeemable noncontrolling interest was classified as a liability in the accompanying Consolidated Balance Sheet as of September 28, 2013 under the caption, Other current liabilities.

On August 22, 2014, the Company purchased the noncontrolling interest holder's shares for approximately $5.6 million, resulting in the subsidiary being wholly-owned by the Company. Of the $5.6 million purchase price, $0.8 million is in escrow and is contingently returnable to the Company upon final determination of fair value of the noncontrolling interest holder's shares. The contingent consideration is recorded in the accompanying Consolidated Balance Sheet as of September 27, 2014 under the caption, Other current assets, and any changes in the fair value of the contingent consideration will be recognized in earnings until resolved.

9.     Product Warranties

The Company offers a one-year warranty on all Keurig® brewers it sells. The Company provides for the estimated cost of product warranties, primarily using historical information and current repair or replacement costs, at the time product revenue is recognized. Brewer failures may arise in the later part of the warranty period, and actual warranty costs may exceed the reserve. As the Company has grown, it has added significantly to its product testing, quality control infrastructure and overall quality processes. Nevertheless, as the Company continues to innovate, and its products become more complex, both in design and componentry, product performance may tend to modulate, causing warranty rates to possibly fluctuate going forward. As a result, future warranty claims rates may be higher or lower than the Company is currently experiencing and for which the Company is currently providing in its warranty reserve.

The changes in the carrying amount of product warranties for fiscal years 2014 and 2013 are as follows (in thousands):

	Fiscal 2014			Fiscal 2013
Balance, beginning of year	$	7,804		$	20,218
Provision related to current period		27,484			20,447
Change in estimate		(1,485	)		(12,720	)
Usage		(20,953	)		(20,141	)
Balance, end of year	$	12,850		$	7,804

During fiscal years 2014 and 2013, the Company recovered approximately $1.8 million and $0.8 million respectively, as reimbursement from suppliers related to warranty issues. The recoveries are under an agreement with a supplier and are recorded as a reduction to warranty expense. The recoveries are not reflected in the provision charged to income in the table above.

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Notes to Consolidated Financial Statements—(Continued)

10.   Long-Term Debt

Long-term debt outstanding consists of the following (in thousands) as of:

	September 27, 2014		September 28, 2013
Term loan A		158,438		170,937
Other		1,576		2,213
Total long-term debt	$	160,014	$	173,150
Less current portion		19,077		12,929
Long-term portion	$	140,937	$	160,221

Under the Company's current credit facility ("Restated Credit Agreement"), the Company maintains senior secured credit facilities consisting of (i) an $800.0 million U.S. revolving credit facility, (ii) a $200.0 million alternative currency revolving credit facility, and (iii) a term loan A facility. The Restated Credit Agreement also provides for an increase option for an aggregate amount of up to $500.0 million.

The term loan A facility requires quarterly principal repayments. The term loan and revolving credit borrowings bear interest at a rate equal to an applicable margin plus, at our option, either (a) a eurodollar rate determined by reference to the cost of funds for deposits for the interest period and currency relevant to such borrowing, adjusted for certain costs, or (b) a base rate determined by reference to the highest of (1) the federal funds rate plus 0.50%, (2) the prime rate announced by Bank of America, N.A. from time to time and (3) the eurodollar rate plus 1.00%. The applicable margin under the Restated Credit Agreement with respect to term loan A and revolving credit facilities is a percentage per annum varying from 0.5% to 1.0% for base rate loans and 1.5% to 2.0% for eurodollar loans, based upon the Company's leverage ratio. The Company's average effective interest rate as of September 27, 2014 and September 28, 2013 was 3.7% and 3.5%, respectively, excluding amortization of deferred financing charges and including the effect of interest swap agreements. The Company also pays a commitment fee of 0.2% on the average daily unused portion of the revolving credit facilities.

All the assets of the Company and its domestic wholly-owned material subsidiaries are pledged as collateral under the Restated Credit Agreement. The Restated Credit Agreement contains customary negative covenants, subject to certain exceptions, including limitations on: liens; investments; indebtedness; merger and consolidations; asset sales; dividends and distributions or repurchases of the Company's capital stock; transactions with affiliates; certain burdensome agreements; and changes in the Company's lines of business.

The Restated Credit Agreement requires the Company to comply on a quarterly basis with a consolidated leverage ratio and a consolidated interest coverage ratio. As of September 27, 2014 and throughout fiscal year 2014, the Company was in compliance with these covenants. In addition, the Restated Credit Agreement contains certain mandatory prepayment requirements and customary events of default.

As of September 27, 2014 and September 28, 2013, outstanding letters of credit under the Restated Credit Agreement, totaled $7.8 million and $5.0 million, respectively. No amounts have been drawn against the letters of credit as of September 27, 2014 and September 28, 2013.

In connection with the Restated Credit Agreement, the Company incurred debt issuance costs of $46.0 million which were deferred and included in Other Long-Term Assets on the Consolidated

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Notes to Consolidated Financial Statements—(Continued)

Balance Sheet and amortized as interest expense over the life of the respective loan using a method that approximates the effective interest rate method.

The Company enters into interest rate swap agreements to limit a portion of its exposure to variable interest rates by entering into interest rate swap agreements which effectively fix the rates. In accordance with the interest rate swap agreements and on a monthly basis, interest expense is calculated based on the floating 30-day Libor rate and the fixed rate. If interest expense as calculated is greater based on the 30-day Libor rate, the interest rate swap counterparty pays the difference to the Company; if interest expense as calculated is greater based on the fixed rate, the Company pays the difference to the interest rate swap counterparty. See Note 11, Derivative Financial Instruments.

Below is a summary of the Company's derivative instruments in effect as of September 27, 2014 mitigating interest rate exposure of variable-rate borrowings (in thousands):

Derivative Instrument	Hedged Transaction	Notional Amount of Underlying Debt		Fixed Rate Received			Maturity (Fiscal Year)
Swap	30-day Libor		30,000		2.54	%		2016
Swap	30-day Libor		50,000		2.54	%		2016
Swap	30-day Libor		20,000		2.54	%		2016
Swap	30-day Libor		30,000		2.54	%		2016
		$	130,000

In fiscal years 2014, 2013 and 2012 the Company paid approximately $3.2 million, $3.4 million and $4.7 million, respectively, in additional interest expense pursuant to the interest rate swap agreements.

Maturities

Scheduled maturities of long-term debt are as follows (in thousands):

Fiscal Year
2015		19,077
2016		140,022
2017		348
2018		364
2019		203
	$	160,014

11.   Derivative Financial Instruments

Cash Flow Hedges

The Company is exposed to certain risks relating to ongoing business operations. The primary risks that are mitigated by financial instruments are interest rate risk, commodity price risk and foreign currency exchange rate risk. The Company uses interest rate swaps to mitigate interest rate risk associated with the Company's variable-rate borrowings, enters into coffee futures contracts to hedge future coffee purchase commitments of green coffee with the objective of minimizing cost risk due to market fluctuations, and uses foreign currency forward contracts to hedge the purchase and payment of green coffee purchase commitments denominated in non-functional currencies.

The Company designates these contracts as cash flow hedges and measures the effectiveness of these derivative instruments at each balance sheet date. The changes in the fair value of these instruments are classified in accumulated other comprehensive income (loss). The gains or loss on these instruments is reclassified

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Notes to Consolidated Financial Statements—(Continued)

from OCI into earnings in the same period or periods during which the hedged transaction affects earnings. If it is determined that a derivative is not highly effective, the gain or loss is reclassified into earnings.

Fair Value Hedges

In prior fiscal years, the Company entered into foreign currency forward contracts to hedge certain recognized liabilities in currencies other than the Company's functional currency. The Company designated these contracts as fair value hedges and measured the effectiveness of the derivative instruments at each balance sheet date. The changes in the fair value of these instruments along with the changes in the fair value of the hedged liabilities were recognized in net gains or losses on foreign currency on the consolidated statements of operations.

Other Derivatives

The Company is also exposed to certain foreign currency and interest rate risks on an intercompany note with a foreign subsidiary denominated in Canadian currency. At September 27, 2014, the Company has approximately one year remaining on a CDN $90.0 million, Canadian cross currency swap to exchange interest payments and principal on the intercompany note. This cross currency swap is not designated as a hedging instrument for accounting purposes and is recorded at fair value, with the changes in fair value recognized in the Consolidated Statements of Operations. Gains and losses resulting from the change in fair value are largely offset by the financial impact of the re-measurement of the intercompany note. In accordance with the cross currency swap agreement, on a quarterly basis, the Company pays interest based on the three month Canadian Bankers Acceptance rate and receives interest based on the three month U.S. Libor rate. The Company incurred $1.3 million, $1.7 million, and $1.8 million in additional interest expense pursuant to the cross currency swap agreement during fiscal 2014, 2013, and 2012 respectively.

The Company also occasionally enters into certain foreign currency forward contracts to hedge certain exposures that are not designated as hedging instruments for accounting purposes. These contracts are recorded at fair value, with the changes in fair value recognized in the Consolidated Statements of Operations.

The Company does not hold or use derivative financial instruments for trading or speculative purposes.

The Company is exposed to credit loss in the event of nonperformance by the counterparties to these financial instruments, however, nonperformance is not anticipated.

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Notes to Consolidated Financial Statements—(Continued)

The following table summarizes the fair value of the Company's derivatives included on the Consolidated Balance Sheets (in thousands) as of:

	September 27, 2014			September 28, 2013			Balance Sheet Classification
Derivatives designated as hedges:
Interest rate swaps	$	(3,371	)	$	(6,004	)	Other current liabilities
Coffee futures		3,437			—		Other current assets
Coffee futures		—			(3,809	)	Other current liabilities
Foreign currency forward contracts		—			(141	)	Other current liabilities
Foreign currency forward contracts		108			13		Other current assets
		174			(9,941	)
Derivatives not designated as hedges:
Cross currency swap		5,951			—		Other current assets
Cross currency swap		—			(1,253	)	Other current liabilities
		5,951			(1,253	)
Total	$	6,125		$	(11,194	)

Offsetting

Generally, all of the Company's derivative instruments are subject to a master netting arrangement under which either party may offset amounts if the payment amounts are for the same transaction and in the same currency. By election, parties may agree to net other transactions. In addition, the arrangements provide for the net settlement of all contracts through a single payment in a single currency in the event of default or termination of the contract. The Company's policy is to net all derivative assets and liabilities in the accompanying audited Consolidated Balance Sheets when allowable by GAAP.

Additionally, the Company has elected to include all derivative assets and liabilities, including those not subject to a master netting arrangement, in the following offsetting tables.

Offsetting of financial assets and derivative assets as of September 27, 2014 and September 28, 2013 is as follows (in thousands):

						Net amount of assets presented in the Consolidated Balance Sheet
			Gross amounts offset in the Consolidated Balance Sheet					Gross amounts not offset in the Consolidated Balance Sheet
	Gross amounts of recognized assets
								Financial instruments		Cash collateral received		Net amount
Derivative assets, as of September 27, 2014	$	9,830	$	(334	)	$	9,496	$	—	$	—	$	9,496
Derivative assets, as of September 28, 2013		13		—			13		—		—		13

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Notes to Consolidated Financial Statements—(Continued)

Offsetting of financial liabilities and derivative liabilities as of September 27, 2014 and September 28, 2013 is as follows (in thousands):

						Net amount of assets presented in the Consolidated Balance Sheet
			Gross amounts offset in the Consolidated Balance Sheet					Gross amounts not offset in the Consolidated Balance Sheet
	Gross amounts of recognized assets
								Financial instruments		Cash collateral received		Net amount
Derivative liabilities, as of September 27, 2014	$	3,705	$	(334	)	$	3,371	$	—	$	—	$	3,371
Derivative liabilities, as of September 28, 2013		11,207		—			11,207		—		—		11,207

The following table summarizes the coffee futures contracts outstanding as of September 27, 2014 (in thousands, except for average contract price and "C" price):

Coffee Pounds		Average Contract Price		"C" Price		Maturity		Fair Value of Futures Contracts
	900	$	1.27	$	1.94		July 2015	$	602
	4,725	$	1.27	$	1.94		July 2015		3,169
	938	$	2.13	$	1.94		July 2015		(174	)
	937	$	2.12	$	1.95		September 2015		(160	)
	7,500							$	3,437

The following table summarizes the coffee futures contracts outstanding as of September 28, 2013 (in thousands, except for average contract price and "C" price):

Coffee Pounds		Average Contract Price		"C" Price		Maturity		Fair Value of Futures Contracts
	375	$	1.50	$	1.14		December 2013	$	(138	)
	5,887	$	1.39	$	1.17		March 2014		(1,308	)
	11,438	$	1.30	$	1.19		May 2014		(1,222	)
	10,875	$	1.32	$	1.21		July 2014		(1,141	)
	28,575							$	(3,809	)

The following table summarizes the amount of gain (loss), gross of tax, arising during the period on financial instruments that qualify for hedge accounting included in OCI (in thousands):

	Fiscal 2014		Fiscal 2013			Fiscal 2012
Cash Flow Hedges:
Interest rate swaps	$	2,634	$	3,014		$	1,250
Coffee futures		17,824		(6,617	)		(2,484	)
Foreign currency forward contracts		183		(129	)		—
Total	$	20,641	$	(3,732	)	$	(1,234	)

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Notes to Consolidated Financial Statements—(Continued)

The following table summarizes the amount of gain (loss), gross of tax, reclassified from OCI to income (in thousands):

	Fiscal 2014			Fiscal 2013			Fiscal 2012			Location of Gain or (Loss) Reclassified from OCI into Income
Coffee futures		(6,387	)		(1,482	)		(1,359	)	Cost of sales
Foreign currency forward contracts		74			—			—		Cost of sales
Foreign currency forward contracts		(2	)		(2	)		—		(Loss) gain on foreign currency, net
Total	$	(6,315	)	$	(1,484	)	$	(1,359	)

The Company expects to reclassify $9.4 million of net gains, net of tax, from OCI to earnings on coffee derivatives within the next twelve months.

See note 14, Stockholders' Equity for a reconciliation of derivatives in beginning accumulated other comprehensive income (loss) to derivatives in ending accumulated other comprehensive income (loss).

The following table summarizes the amount of gain (loss), gross of tax, on fair value hedges and related hedged items (in thousands):

	Fiscal 2014		Fiscal 2013			Fiscal 2012			Location of gain (loss) recognized in income on derivative
Foreign currency forward contracts
Net loss on hedging derivatives	$	—	$	(10	)	$	(48	)	(Loss) gain on foreign currency, net
Net gain on hedged items	$	—	$	10		$	48		(Loss) gain on foreign currency, net

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Notes to Consolidated Financial Statements—(Continued)

Net gains (losses) on financial instruments not designated as hedges for accounting purposes are as follows (in thousands):

	Fiscal 2014		Fiscal 2013		Fiscal 2012			Location of net gain (loss) in Consolidated Statements of Operations
Net gain (loss) on cross currency swap	$	8,307	$	5,513	$	(4,918	)	Gain (loss) on financial instruments, net
Net gain on coffee futures		7,005		—		—		Cost of sales
Net loss on interest rate cap		—		—		(34	)	Gain (loss) on financial instruments, net
Net gain on coffee futures		—		—		7		Gain (loss) on financial instruments, net
Total	$	15,312	$	5,513	$	(4,945	)

In addition, for fiscal year 2014, the Company recognized $1.7 million in net gains, as cost of sales, representing the ineffective portion on coffee futures designated as cash flow hedges. No amounts were recognized in fiscal 2013 and 2012 for ineffectiveness.

12.   Fair Value Measurements

The Company measures fair value as the selling price that would be received for an asset, or paid to transfer a liability, in the principal or most advantageous market on the measurement date. The hierarchy established by the Financial Accounting Standards Board prioritizes fair value measurements based on the types of inputs used in the valuation technique. The inputs are categorized into the following levels:

Level 1 — Observable inputs such as quoted prices in active markets for identical assets or liabilities.

Level 2 — Inputs other than quoted prices that are observable, either directly or indirectly, which include quoted prices for similar assets or liabilities in active markets and quoted prices for identical assets or liabilities in markets that are not active.

Level 3 — Unobservable inputs not corroborated by market data, therefore requiring the entity to use the best available information, including management assumptions.

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Notes to Consolidated Financial Statements—(Continued)

The following table summarizes the fair values and the levels used in fair value measurements as of September 27, 2014 for the Company's financial (liabilities) assets (in thousands):

	Fair Value Measurements Using
	Level 1		Level 2			Level 3
Derivatives:
Interest rate swaps	$	—	$	(3,371	)	$	—
Cross currency swap		—		5,951			—
Coffee futures		—		3,437			—
Foreign currency forward contracts		—		108			—
Total	$	—	$	6,125		$	—

The following table summarizes the fair values and the levels used in fair value measurements as of September 28, 2013 for the Company's financial liabilities (in thousands):

	Fair Value Measurements Using
	Level 1		Level 2			Level 3
Derivatives:
Interest rate swaps	$	—	$	(6,004	)	$	—
Cross currency swap		—		(1,253	)		—
Coffee futures		—		(3,809	)		—
Foreign currency forward contracts		—		(128	)		—
Total	$	—	$	(11,194	)	$	—

Level 2 derivative financial instruments use inputs that are based on market data of identical (or similar) instruments, including forward prices for commodities, interest rates curves and spot prices that are in observable markets. Derivatives recorded on the balance sheet are at fair value with changes in fair value recorded in OCI for cash flow hedges and in the Consolidated Statements of Operations for fair value hedges and derivatives that do not qualify for hedge accounting treatment.

Derivatives

Derivative financial instruments include coffee futures contracts, interest rate swap agreements, a cross-currency swap agreement and foreign currency forward contracts. The Company has identified significant concentrations of credit risk based on the economic characteristics of the instruments that include interest rates, commodity indexes and foreign currency rates and selectively enters into the derivative instruments with counterparties using credit ratings.

To determine fair value, the Company utilizes the market approach valuation technique for coffee futures and foreign currency forward contracts and the income approach for interest rate and cross currency swap agreements. The Company's fair value measurements include a credit valuation adjustment for the significant concentrations of credit risk.

As of September 27, 2014, the amount of loss estimated by the Company due to credit risk associated with the derivatives for all significant concentrations was not material based on the factors of an industry recovery rate and a calculated probability of default.

Long-Term Debt

The carrying value of long-term debt was $160.0 million and $173.2 million as of September 27, 2014 and September 28, 2013, respectively. The inputs to the calculation of the fair value of long-term debt are considered to be Level 2 within the fair value

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Notes to Consolidated Financial Statements—(Continued)

hierarchy, as the measurement of fair value is based on the net present value of calculated interest and principal payments, using an interest rate derived from a fair market yield curve adjusted for the Company's credit rating. The carrying value of long-term debt approximates fair value as the interest rate on the debt is based on variable interest rates that reset every 30 days.

Long-Term Investment

The Company has a long-term investment of approximately $35.9 million included in other long-term assets in the accompanying audited Consolidated Balance Sheet as of September 27, 2014, that is not publicly traded. This investment is carried at cost and reviewed quarterly for indicators of other-than-temporary impairment. There were no events or circumstances during the fiscal year ended September 27, 2014 that indicated a decline in the fair value of the investment.

13.   Income Taxes

Income before income taxes and the provision for income taxes for fiscal years 2014, 2013 and 2012, consist of the following (in thousands):

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Income before income taxes:
Domestic	$	856,240		$	675,438		$	486,258
Foreign		68,133			65,436			89,883
Total income before income taxes	$	924,373		$	740,874		$	576,141
Income tax expense:
United States federal:
Current	$	288,757		$	202,006		$	75,932
Deferred		(41,589	)		(8,654	)		74,042
		247,168			193,352			149,974
State and local:
Current		61,839			47,930			40,270
Deferred		(811	)		(1,695	)		(712	)
		61,028			46,235			39,558
Total United States		308,196			239,587			189,532
Foreign:
Current		36,903			29,901			26,860
Deferred		(18,140	)		(12,717	)		(3,751	)
Total foreign		18,763			17,184			23,109
Total income tax expense	$	326,959		$	256,771		$	212,641

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Notes to Consolidated Financial Statements—(Continued)

Net deferred tax liabilities consist of the following (in thousands) as of:

	September 27, 2014			September 28, 2013
Deferred tax assets:
Section 263A capitalized expenses	$	9,011		$	1,876
Deferred hedging gains		—			4,774
Deferred compensation		17,053			13,632
Capital loss carryforward		1,568			1,418
Valuation allowance—capital loss carryforward		(1,568	)		(1,418	)
Warranty, obsolete inventory and bad debt allowance		42,903			32,692
Tax credit carryforwards		2,085			3,651
Other reserves and temporary differences		10,053			15,558
Gross deferred tax assets		81,105			72,183
Deferred tax liabilities:
Prepaid expenses		(6,190	)		(2,994	)
Deferred hedging losses		(6,059	)		—
Depreciation		(97,977	)		(125,504	)
Intangible assets		(115,812	)		(138,262	)
Other reserves and temporary differences		(174	)		(237	)
Gross deferred tax liabilities		(226,212	)		(266,997	)
Net deferred tax liabilities	$	(145,107	)	$	(194,814	)

A reconciliation for continuing operations between the amount of reported income tax expense and the amount computed using the U.S. Federal Statutory rate of 35% is as follows (in thousands):

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Tax at U.S. Federal Statutory rate	$	323,530		$	259,306		$	201,692
Increase (decrease) in rates resulting from:
Foreign tax rate differential		(13,614	)		(13,087	)		(18,072	)
Non-deductible stock compensation expense		1,562			2,700			1,024
State taxes, net of federal benefit		47,195			31,869			27,114
Provincial taxes		8,080			7,878			10,591
Domestic production activities deduction		(32,568	)		(23,558	)		(9,245	)
Federal tax credits		(336	)		(4,506	)		(282	)
Release of capital loss valuation allowance		—			—			(3,071	)
Other		(6,890	)		(3,831	)		2,890
Tax at effective rates	$	326,959		$	256,771		$	212,641

As of September 27, 2014, the Company had a $17.7 million state capital loss carryforward and a state net operating loss carryforward of $11.5 million available to be utilized against future taxable income for years through fiscal 2015 and 2029, respectively, subject to annual limitation pertaining to change in ownership rules under the Internal Revenue Code of 1986, as amended (the "Code"). Based upon earnings history, the Company concluded that it is more likely than not that the net operating loss carryforward will be utilized prior to its expiration but that the capital loss carryforward will not. The Company has recorded a valuation

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Notes to Consolidated Financial Statements—(Continued)

allowance against the entire deferred tax asset balance for the capital loss carryforward.

The total amount of unrecognized tax benefits as of September 27, 2014 and September 28, 2013 was $14.8 million and $23.3 million, respectively. The amount of unrecognized tax benefits at September 27, 2014 that would impact the effective tax rate if resolved in favor of the Company is $14.8 million. As a result of prior acquisitions, the Company is indemnified for up to $9.2 million of the total reserve balance, and the indemnification is capped at CDN $30.0 million. If these unrecognized tax benefits are resolved in favor of the Company, the associated indemnification receivable, recorded in other long-term assets would be reduced accordingly. As of September 27, 2014 and September 28, 2013, accrued interest and penalties of $2.4 million and $2.0 million, respectively, were included in the Consolidated Balance Sheets. The Company recognizes interest and penalties in income tax expense. The Company released $0.2 million of unrecognized tax benefits in the fourth quarter of fiscal 2014 due to the expiration of the statute of limitations. Income tax expense included $0.4 million, $0.4 million and $0.2 million of interest and penalties for fiscal 2014, 2013, and 2012, respectively.

A reconciliation of increases and decreases in unrecognized tax benefits, including interest and penalties, is as follows (in thousands):

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Gross tax contingencies—balance, beginning of year	$	23,283		$	23,956		$	24,419
Increases from positions taken during prior periods		—			438			2,864
Decreases from positions taken during prior periods		—			—			(4,093	)
Increases from positions taken during current periods		504			2,709			906
Decreases resulting from the lapse of the applicable statute of limitations		(8,948	)		(3,820	)		(140	)
Gross tax contingencies—balance, end of year	$	14,839		$	23,283		$	23,956

The Company expects to release $5.0 million of unrecognized tax benefits during fiscal 2015 due to the expiration of the statute of limitations.

As of September 27, 2014, the Company had approximately $200.9 million of undistributed international earnings, most of which are Canadian-sourced. With the exception of the repayment of intercompany debt, all earnings of the Company's foreign subsidiaries are considered indefinitely reinvested and no U.S. deferred taxes have been provided on those earnings. If these amounts were distributed to the U.S. in the form of dividends or otherwise, the Company would be subject to additional U.S. income taxes, which could be material. Determination of the amount of any unrecognized deferred income tax on these earnings is not

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Notes to Consolidated Financial Statements—(Continued)

practicable because such liability, if any, is dependent on circumstances existing if and when remittance occurs.

In the normal course of business, the Company is subject to tax examinations by taxing authorities both inside and outside the United States. With some exceptions, the Company is no longer subject to examinations with respect to returns filed for fiscal years prior to 2010.

14.   Stockholders' Equity

Stock Issuances

On February 27, 2014, pursuant to a common stock purchase agreement dated February 5, 2014, the Company sold 16,684,139 shares of its common stock to Atlantic Industries, an indirect wholly owned subsidiary of The Coca-Cola Company, at $74.98 per share for an aggregate purchase price of $1,251.0 million. In addition, on April 17, 2014, pursuant to a common stock purchase agreement dated March 28, 2014 and the pre-emptive rights of Luigi Lavazza S.p.A. ("Lavazza") set forth in the common stock purchase agreement (the "CSPA") between the Company and Lavazza dated August 10, 2010, the Company sold 1,407,000 shares of its common stock to Lavazza at $74.98 per share for an aggregate purchase price of $105.5 million. Pursuant to the CSPA, in connection with the offering of common stock to Atlantic Industries, Lavazza is entitled to maintain its current percentage ownership of the Company's outstanding common stock on terms (including price) not less favorable than those proposed for the Atlantic Industries offering. Both common stock sales were recorded to stockholders' equity, net of transaction-related expenses of approximately $8.0 million.

Stock Repurchase Program

Under its existing repurchase programs, on February 28, 2014, the Company entered into an accelerated share repurchase ("ASR") agreement with a major financial institution ("Bank"). The ASR allows the Company to buy a large number of shares immediately at a purchase price determined by an average market price over a period of time. Under the ASR, the Company agreed to purchase $700.0 million of its common stock, in total, with an initial delivery to the Company of 4,340,508 shares ("Initial Shares") of the Company's common stock by the Bank. The Initial Shares represent the number of shares at the current market price equal to 70% of the total fixed purchase price of $700.0 million. The repurchased shares were retired and returned to an unissued status. The par value of the repurchased shares of $0.4 million was deducted from common stock and the excess repurchase price over the par value of $489.6 million was deducted from additional paid-in capital. The remainder of the total purchase price of $210.0 million reflects the value of the stock held by the Bank pending final settlement and, accordingly, was recorded as a reduction to additional paid-in capital. Final settlement of the ASR will occur no sooner than November 24, 2014 and no later than February 27, 2015 at the Bank's discretion. Upon settlement of the ASR, the total shares repurchased by the Company will be determined based on a share price equal to the daily volume weighted-average price ("VWAP") of the Company's common stock during the term of the ASR program, less a fixed per share discount amount. At settlement, the Bank will deliver additional shares to the Company in the event total shares are greater than the 4,340,508 shares initially delivered, and the Company will issue additional shares to the Bank in the event total shares are less than the shares initially delivered. The receipt or issuance of additional shares will result in a reclassification between additional paid-in

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Notes to Consolidated Financial Statements—(Continued)

capital and common stock equal to the par value of the additional shares received or issued. The number of shares that may be required to be issued by the Company to the Bank is limited to 10.0 million shares under the ASR.

The Company reflected the unsettled portion of the ASR ($210.0 million) as a repurchase of common stock for purposes of calculating earnings per share and as a forward contract indexed to its own common stock. The forward contract met all of the applicable criteria for equity classification, and, therefore, was not accounted for as a derivative instrument.

As of September 27, 2014, based on the VWAP of the Company's common stock for the period February 28, 2014 through September 27, 2014, settlement of the ASR would have resulted in 1.9 million additional shares delivered by the Bank to the Company.

An aggregate amount of $1,182.8 million remained authorized for common stock repurchase as of September 27, 2014.

	Fiscal 2014(1)		Fiscal 2013
Number of shares acquired		8,138,592		5,642,793
Average price per share of acquired shares	$	103.51	$	33.37
Total cost of acquired shares (in thousands)	$	1,052,430	$	188,278

⁽¹⁾

Number of shares acquired and average price per share reflect Initial Shares at then current market price, subject to change pending final settlement, and total cost of acquired shares includes total purchase price of $700.0 million under the ASR.

Common Stock Dividends

Each quarter during fiscal 2014, the Company declared a quarterly dividend of $0.25 per common share, or $158.9 million in the aggregate. During the fiscal year ended September 27, 2014, the Company paid dividends of approximately $118.4 million.

On November 13, 2014, Keurig's Board of Directors declared the next quarterly cash dividend of $0.2875 per common share, an increase of 15 percent as compared to quarterly cash dividends in fiscal 2014, payable on February 12, 2015 to shareholders of record as of the close of business on January 13, 2015.

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Notes to Consolidated Financial Statements—(Continued)

Accumulated Other Comprehensive Income (Loss)

The following table provides the changes in the components of accumulated other comprehensive income (loss), net of tax (in thousands):

	Cash Flow Hedges			Translation			Accumulated Other Comprehensive Income (Loss)
Balance at September 24, 2011		(5,866	)		(8,709	)		(14,575	)
Other comprehensive income during the period		74			24,701			24,775
Balance at September 29, 2012		(5,792	)		15,992			10,200
Other comprehensive loss during the period		(1,358	)		(28,027	)		(29,385	)
Balance at September 28, 2013		(7,150	)		(12,035	)		(19,185	)
Other comprehensive income during the period		16,093			(50,968	)		(34,875	)
Foreign currency exchange impact on cash flow hedges		9			—			9
Balance at September 27, 2014	$	8,952		$	(63,003	)	$	(54,051	)

The unfavorable translation adjustments change during fiscal 2014 and fiscal 2013 was primarily due to the weakening of the Canadian dollar against the U.S. dollar. The favorable translation adjustment change during fiscal year 2012 was primarily due to the strengthening of the Canadian against the U.S. dollar. See also Note 11, Derivative Financial Instruments.

15.   Employee Compensation Plans

Equity-Based Incentive Plans

On March 6, 2014, the Company registered on Form S-8 shares of common stock pursuant to the 2014 Omnibus Plan (the "2014 Plan"), which replaced the 2006 Incentive Plan (the "2006 Plan") and increased the total shares of common stock authorized for issuance to 8,000,000 (the "Fungible Pool Limit"). Both plans provide for the issuance of several types of share-based incentive compensation including stock options, stock appreciation rights, restricted stock, restricted stock units and performance stock units. Following shareholder approval of the 2014 Plan, there were no further awards made under the 2006 Plan. Under the 2014 Plan, each share of common stock issued or to be issued in connection with any award that is not a stock option or stock appreciation right shall be counted against the Fungible Pool Limit as 1.704 Fungible Pool Units. Stock options and stock appreciation rights shall be counted against the Fungible Pool Limit as 1.0 Fungible Pool Unit. Both the 2014 Plan and 2006 Plan require the exercise price for all awards requiring exercise to be no less than 100% of fair market value per share of common stock on the date of grant, with certain provisions which increase the option exercise price of an incentive stock option to 110% of the fair market value of the common stock if the grantee owns in excess of 10% of the Company's common stock at the date of grant. As of September 27, 2014, 7.3 million shares of common stock were available for grant for future equity-based compensation awards under the 2014 Plan.

Options under the 2006 Plan and 2014 Plan become exercisable over periods determined by the Board of Directors, generally in the range of three to five years.

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Notes to Consolidated Financial Statements—(Continued)

As of September 27, 2014, 39,251 options remain outstanding under Keurig, Incorporated 2005 Stock Option Plan assumed in the 2006 acquisition of Keurig, Incorporated as well as stock options related to two previous inducement grants of non-qualified options to two officers of the Company which were not subject to shareholder approval.

Option activity is summarized as follows:

	Number of Shares			Weighted Average Exercise Price (per share)
Outstanding at September 28, 2013		5,022,340		$	18.30
Granted		386,309		$	73.53
Exercised		(1,872,448	)	$	15.02
Forfeited/expired		(99,474	)	$	54.56
Outstanding at September 27, 2014		3,436,727		$	25.24
Exercisable at September 27, 2014		2,541,149		$	13.68

The following table summarizes information about stock options that have vested and are expected to vest at September 27, 2014:

Number of options outstanding	Weighted average remaining contractual life (in years)		Weighted average exercise price		Intrinsic value at September 27, 2014 (in thousands)
3,428,994		4.66	$	25.15	$	361,691

The following table summarizes information about stock options exercisable at September 27, 2014:

Number of options exercisable	Weighted average remaining contractual life (in years)		Weighted average exercise price		Intrinsic value at September 27, 2014 (in thousands)
2,541,149		3.40	$	13.68	$	297,200

Compensation expense is recognized only for those options expected to vest, with forfeitures estimated based on the Company's historical employee turnover experience and future expectations.

The Company uses a blend of recent and historical volatility to estimate expected volatility at the measurement date. The expected life of options is estimated based on options vesting periods, contractual lives and an analysis of the Company's historical experience.

The intrinsic values of options exercised during fiscal years 2014, 2013 and 2012 were approximately $167.0 million, $165.5 million and $46.6 million, respectively. The Company's policy is to issue new shares upon exercise of stock options.

The grant-date fair value of employee share options and similar instruments is estimated using the Black-Scholes option-pricing

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Notes to Consolidated Financial Statements—(Continued)

model with the following assumptions for grants issued during fiscal years 2014, 2013 and 2012:

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Average expected life		5.5 years			6.0 years			6.0 years
Average volatility		74	%		81	%		69	%
Dividend yield		1.30	%		—	%		—	%
Risk-free interest rate		1.70	%		1.02	%		1.31	%
Weighted average fair value	$	42.38		$	31.23		$	30.10

Restricted Stock Units and Other Awards

The Company awards restricted stock units ("RSUs"), restricted stock awards ("RSAs"), and performance stock units ("PSUs") to eligible employees ("Grantee") which entitle the Grantee to receive shares of the Company's common stock. RSUs and PSUs are awards denominated in units that are settled in shares of the Company's common stock upon vesting. RSAs are awards of common stock that are restricted until the shares vest. In general, RSUs and RSAs vest based on a Grantee's continuing employment. The fair value of RSUs, RSAs and PSUs is based on the closing price of the Company's common stock on the grant date. Compensation expense for RSUs and RSAs is recognized ratably over a Grantee's service period. Compensation expense for PSUs is also recognized over a Grantee's service period, but only if and when the Company concludes that it is probable (more than likely) the performance condition(s) will be achieved. The assessment of probability of achievement is performed each period based on the relevant facts and circumstances at that time, and if the estimated grant-date fair value changes as a result of that assessment, the cumulative effect of the change on current and prior periods is recognized in the period of change. In addition, the Company has awarded deferred cash awards ("DCAs"), to Grantees which entitle a Grantee to receive cash paid over time upon vesting. The vesting of DCAs is conditioned on a Grantee's continuing employment. All awards are reserved for issuance under the 2006 Plan, and beginning with awards granted after March 6, 2014, the 2014 Plan. These awards vest over periods determined by the Board of Directors, generally in the range of three to four years for RSUs, RSAs and DCAs, and three years for PSUs.

The following table summarizes the number and weighted average grant-date fair value of nonvested RSUs (amounts in thousands except grant date fair value and weighted average remaining contractual life):

	Share Units			Weighted Average Grant-Date Fair Value		Weighted Average Remaining Contractual Life (in Years)		Intrinsic Value (in Thousands)
Nonvested, September 28, 2013		221,502		$	42.74		1.71	$	16,586
Granted		259,507		$	119.95
Vested		(56,781	)	$	61.04
Forfeited		(15,055	)	$	82.00
Nonvested, September 27, 2014		409,173		$	86.50		3.26	$	53,450

As of September 27, 2014, total RSUs expected to vest totaled 406,521 shares with an intrinsic value of $53.1 million. The weighted average grant-date fair value of RSUs granted was $119.95 and $45.19 for fiscal 2014 and fiscal 2013, respectively.

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Notes to Consolidated Financial Statements—(Continued)

The total intrinsic value of RSUs converted to shares of common stock during fiscal 2014 and fiscal 2013 was $6.1 million and $2.2 million, respectively.

The following table summarizes the number and weighted average grant-date fair value of nonvested PSUs based on the target award amounts in the PSU agreements as of September 27, 2014:

	Share Units			Weighted Average Grant-Date Fair Value
Outstanding on September 28, 2013		120,668		$	41.10
Granted		84,232		$	107.12
Forfeited		(9,118	)	$	86.87
Outstanding on September 27, 2014(1)		195,782		$	67.38

⁽¹⁾

The outstanding PSUs as of September 27, 2014, at the threshold award and maximum award levels were 172,313 and 297,689, respectively.

The weighted average grant-date fair value of PSUs granted was $107.12 in fiscal 2014 compared to $41.28 in 2013. There were no PSUs converted to shares of common stock during fiscal 2014.

In addition, during fiscal 2012 the Company issued a grant for 55,432 RSAs which vested in fiscal 2013 with a total intrinsic value of $2.7 million.

Employee Stock Purchase Plan

On March 6, 2014, the Company registered on Form S-8 shares pursuant to the 2014 Amended and Restated Employee Stock Purchase Plan ("2014 ESPP") which replaced the Amended and Restated Employee Stock Purchase Plan ("2008 ESPP"). Under both plans, eligible employees may purchase shares of the Company's common stock, subject to certain limitations, at the lesser of 85 percent of the beginning or ending withholding period fair market value as defined in the plan. There were two six-month withholding periods in each fiscal year. As of September 27, 2014, rights to acquire 2,045,520 shares of common stock were available for issuance under the 2014 ESPP.

The grant-date fair value of employees' purchase rights granted during fiscal years 2014, 2013 and 2012 under the Company's ESPP is estimated using the Black-Scholes option-pricing model with the following assumptions:

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Average expected life		6 months			6 months			6 months
Average volatility		55	%		86	%		70	%
Dividend yield		1.14	%		—	%		—	%
Risk-free interest rate		0.06	%		0.13	%		0.90	%
Weighted average fair value	$	26.06		$	14.38		$	11.61

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Stock-Based Compensation Expense

Stock-based compensation expense recognized in the Consolidated Statements of Operations in fiscal years 2014, 2013, and 2012 (in thousands):

	Fiscal 2014		Fiscal 2013		Fiscal 2012
Options	$	13,029	$	14,151	$	12,595
RSUs/PSUs/RSAs		13,200		7,529		1,861
ESPP		4,444		4,401		3,412
Total stock-based compensation expense recognized in the Consolidated Statements of Operations	$	30,673	$	26,081	$	17,868
Total related tax benefit	$	12,005	$	9,936	$	6,004

As of September 27, 2014, total unrecognized compensation cost related to all nonvested stock-based compensation arrangements was approximately $55.2 million net of estimated forfeitures. This unrecognized cost is expected to be recognized over a weighted-average period of approximately 1.8 years at September 27, 2014.

16.   Employee Retirement Plans

Defined Contribution Plans

The Company has a defined contribution plan which meets the requirements of section 401(k) of the Internal Revenue Code. All regular full-time U.S. employees of the Company who are at least eighteen years of age and work a minimum of 36 hours per week are eligible to participate in the plan. The plan allows employees to defer a portion of their salary on a pre-tax basis and the Company contributes 50% of amounts contributed by employees up to 6% of their salary. Company contributions to the plan were $6.4 million, $5.2 million, and $4.4 million, for fiscal years 2014, 2013, and 2012, respectively.

In conjunction with the Van Houtte acquisition, the Company also has several Canadian Group Registered Retirement Savings Plans ("GRRSP") and a Deferred Profit Sharing Plan ("DPSP"). Under these plans, employees can contribute a certain percentage of their salary and the Company can also make annual contributions to the plans. Company contributions to the Canadian plans were $1.5 million, $1.4 million and $1.0 million for fiscal years 2014, 2013, and 2012, respectively.

Defined Benefit Plans

The Company has a supplementary defined benefit retirement plan and a supplementary employee retirement plan (collectively the "Plans") for certain management employees in the Canada segment. The cost of the Plans is calculated according to actuarial methods that encompass management's best estimate regarding the future evolution of salary levels, the age of retirement of salaried employees and other actuarial factors. These Plans are not funded and there are no plan assets. Future benefits will be paid from the funds of the Company.

For each of the years ended September 27, 2014 and September 28, 2013, the projected benefit obligation was $1.4 million and is classified in other long-term liabilities. Net periodic pension expense (income) was $0.2 million, $0.3 million and $(0.1) million for fiscal years 2014, 2013, and 2012, respectively.

17.   Deferred Compensation Plan

The 2002 Deferred Compensation Plan, amended in December 2007 and June 2014, permits certain highly compensated officers and employees of the Company and non-employee directors to

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defer eligible compensation payable for services rendered to the Company. On March 8, 2013, the Company registered on Form S-8 shares related to the 2002 Deferred Compensation Plan. Participants may elect to receive deferred compensation in the form of cash payments or shares of Company Common Stock on the date or dates selected by the participant or on such other date or dates specified in the Deferred Compensation Plan. The Deferred Compensation Plan is in effect for compensation earned on or after September 29, 2002. As of September 27, 2014, and September 28, 2013, 351,276 shares and 353,434 shares of Common Stock were available for future issuance under this Plan, respectively. During fiscal 2014, rights to acquire 2,158 shares of Common Stock were granted and vested, and 130 rights to shares of Common Stock were exercised. As of September 27, 2014 and September 28, 2013, rights to acquire 61,589 and 59,561 shares of Common Stock were outstanding under this plan.

18.   Accrued Expenses

Accrued expenses consisted of the following (in thousands) as of:

	September 27, 2014		September 28, 2013
Accrued compensation costs	$	101,734	$	91,418
Accrued customer incentives and promotions		74,578		53,689
Accrued freight, fulfillment and transportation costs		30,108		21,941
Accrued legal and professional services		18,635		8,278
Warranty reserve		12,850		7,804
Other		67,772		59,297
	$	305,677	$	242,427

19.   Commitments and Contingencies

Lease Commitments

The Company leases office and retail space, production, distribution and service facilities, and certain equipment under various non-cancellable operating leases, with terms ranging from one to twenty years. Property leases normally require payment of a minimum annual rental plus a pro-rata share of certain landlord operating expenses. Total rent expense, under all operating leases approximated $24.8 million, $23.1 million, and $25.1 million in fiscal years 2014, 2013, and 2012, respectively. The Company has subleases relating to certain of its operating leases. Sublease

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income approximated $1.0 million, $1.1 million and $0.3 million for fiscal years 2014, 2013 and 2012, respectively.

In addition, the Company leases a manufacturing facility which is accounted for as a capital lease. The initial term of the lease is 15 years with six additional renewal terms of five years each at the Company's option. The lease requires payment of a minimum annual rental and the Company is responsible for property taxes, insurance and operating expenses.

In June 2012, the Company entered into an arrangement to lease approximately 425,000 square feet located in Burlington, Massachusetts; the building was completed in July 2014.

Due to the Company's involvement in the Burlington, Massachusetts construction project, including its obligations to fund certain costs of construction exceeding amounts incurred by the lessor, the Company was deemed to be the owner of the project, which includes a pre-existing structure on the site, even though the Company is not the legal owner. Accordingly, total project costs incurred during construction were capitalized along with a corresponding financing obligation for the project costs that were incurred by the lessor. In addition, the Company capitalized the estimated fair value of the pre-existing structure of $4.1 million at the date construction commenced as construction-in-progress with a corresponding financing obligation. Upon completion of the project, the Company has continued involvement beyond a normal leaseback, and therefore has not recorded a sale or derecognized the assets. As a result, the lease is accounted for as a financing transaction and the recorded asset and related financing obligation remains on the Balance Sheet.

As of September 27, 2014, future minimum lease payments under financing obligations, capital lease obligations and non-cancellable operating leases as well as minimum payments to be received under non-cancellable subleases are as follows (in thousands):

Fiscal Year	Capital Leases			Operating Leases		Subleases			Financing Obligations
2015	$	3,838		$	15,856	$	(939	)	$	8,828
2016		3,838			12,457		(783	)		9,773
2017		3,838			9,867		(633	)		9,773
2018		3,838			7,402		(585	)		9,868
2019		3,838			3,736		(562	)		9,956
Thereafter		27,820			26,736		(1,429	)		105,833
Total	$	47,010		$	76,054	$	(4,931	)	$	154,031
Less: amount representing interest		(14,886	)
Present value of future minimum lease payments	$	32,124

The above table for financing obligations represents the portion of the future minimum lease payments which have been allocated to the facility in Burlington, Massachusetts and will be recognized as reductions to the financing obligation and as interest expense.

Legal Proceedings

On May 9, 2011, an organization named Council for Education and Research on Toxics ("CERT"), purporting to act in the public interest, filed suit in Los Angeles Superior Court (Council for Education and Research on Toxics v. Brad Barry LLC, et al., Case No. BC461182) against several companies, including the Company, that roast, package, or sell coffee in California. The Brad Barry complaint alleges that coffee contains the chemical acrylamide and

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that the Company and the other defendants are required to provide warnings under section 25249.6 of the California Safe Drinking Water and Toxics Enforcement Act, better known as Proposition 65. Acrylamide is not added to coffee, but forms in trace amounts (parts per billion) as part of a chemical reaction that occurs in the coffee bean when it is roasted. Therefore it is present in all roasted coffee. To date, the Company is unaware of any reliable method for reducing acrylamide levels in coffee without adversely affecting the quality of the product. The Brad Barry action has been consolidated for all purposes with another Proposition 65 case filed by CERT on April 13, 2010 over allegations of acrylamide in "ready to drink" coffee sold in restaurants, convenience stores, and donut shops. (Council for Education and Research on Toxics v. Starbucks Corp., et al., Case No. BC 415759). The Company was not named in the Starbucks complaint. The Company has joined a joint defense group ("JDG") organized to address CERT's allegations, and the Company intends to vigorously defend against these allegations. The Court ordered the case phased for discovery and trial. Trial of the first phase of the case commenced on September 8, 2014 and was limited to three affirmative defenses shared by all defendants in both cases. Other affirmative defenses, plaintiff's prima facie case, and remedies are deferred for subsequent phases if Defendants do not prevail on the three Phase 1 defenses. Testimony in Phase 1 was completed on November 3, 2014. The Court has scheduled a hearing on evidentiary issues on December 3, 2014, after which the Court will set a schedule for submission of post-trial briefs and proposed findings of fact and conclusions of law. At this stage of the proceedings, the Company is unable to predict its outcome, the potential loss or range of loss, if any, associated with its resolution or any potential effect it may have on the Company or its operations.

On January 24, 2012, Teashot, LLC ("Teashot") filed suit against the Company, Keurig and Starbucks Corp. ("Starbucks") in the United States District Court for the District of Colorado (Civil Action No. 12-cv-00189-WJM-KMT) for patent infringement related to the making, using, importing, selling and/or offering for sale of K-Cup® portion packs containing tea. The suit alleges that the Company, Keurig and Starbucks infringe a Teashot patent (U.S. Patent No. 5,895,672). Teashot seeks an injunction prohibiting the Company, Keurig and Starbucks from continued infringement, as well as money damages. Pursuant to the Company's Manufacturing, Sales and Distribution Agreement with Starbucks, the Company is defending and indemnifying Starbucks in connection with the suit. On May 24, 2013, the Company and Keurig, for themselves and Starbucks, filed a motion for summary judgment of non-infringement. On July 19, 2013, Teashot filed a motion for partial summary judgment on certain other, unrelated issues. On February 6, 2014, the district court granted the Company's motion for summary judgment and denied Teashot's motion. The court also awarded the Company its costs. On February 27, 2014, Teashot filed a notice of appeal with the United States Court of Appeals for the Federal Circuit seeking review of the District Court's decision. Oral argument was completed on November 3, 2014. At this time, the Company is unable to predict the outcome of this lawsuit, the potential loss or range of loss, if any, associated with the resolution of this lawsuit or any potential effect it may have on the Company or its operations.

Securities and Exchange Commission ("SEC") Inquiry

On October 16, 2014, the staff of the SEC's Division of Enforcement notified the Company that it had concluded its previously disclosed inquiry into matters at the Company without

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recommending enforcement against the Company or any of its current or former employees.

Stockholder Litigation

One putative securities fraud class action is presently pending against the Company and certain of its officers and directors, along with two putative stockholder derivative actions. The pending putative securities fraud class action was filed on November 29, 2011. The first putative stockholder derivative action is a consolidated action pending in the United States District Court for the District of Vermont that consists of five separate putative stockholder derivative complaints, the first two were filed after the Company's disclosure of the SEC inquiry on September 28, 2010, while the others were filed on February 10, 2012, March 2, 2012, and July 23, 2012, respectively. The second putative stockholder derivative action is pending in the Superior Court of the State of Vermont for Washington County and was commenced following the Company's disclosure of the SEC inquiry on September 28, 2010.

The putative securities fraud class action, captioned Louisiana Municipal Police Employees' Retirement System ("LAMPERS") v. Green Mountain Coffee Roasters, Inc., et al., Civ. No. 2:11-cv-00289, was filed in the United States District Court for the District of Vermont before the Honorable William K. Sessions, III. Plaintiffs' amended complaint alleged violations of the federal securities laws in connection with the Company's disclosures relating to its revenues and its inventory accounting practices. The amended complaint sought class certification, compensatory damages, attorneys' fees, costs, and such other relief as the court should deem just and proper. Plaintiffs sought to represent all purchasers of the Company's securities between February 2, 2011 and November 9, 2011. The initial complaint filed in the action on November 29, 2011 included counts for alleged violations of (1) Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 (the "Securities Act") against the Company, certain of its officers and directors, and the Company's underwriters in connection with a May 2011 secondary common stock offering; and (2) Section 10(b) of the Exchange Act and Rule 10b-5 against the Company and the officer defendants, and for violation of Section 20(a) of the Exchange Act against the officer defendants. Pursuant to the Private Securities Litigation Reform Act of 1995, 15 U.S.C. § 78u-4(a)(3), plaintiffs had until January 30, 2012 to move the court to serve as lead plaintiff of the putative class. Competing applications were filed and the Court appointed Louisiana Municipal Police Employees' Retirement System, Sjunde AP-Fonden, Board of Trustees of the City of Fort Lauderdale General Employees' Retirement System, Employees' Retirement System of the Government of the Virgin Islands, and Public Employees' Retirement System of Mississippi as lead plaintiffs' counsel on April 27, 2012. Pursuant to a schedule approved by the court, plaintiffs filed their amended complaint on October 22, 2012, and plaintiffs filed a corrected amended complaint on November 5, 2012. Plaintiffs' amended complaint did not allege any claims under the Securities Act against the Company, its officers and directors, or the Company's underwriters in connection with the May 2011 secondary common stock offering. Defendants moved to dismiss the amended complaint on March 1, 2013 and on December 20, 2013, the court issued an order dismissing the amended complaint with prejudice. On January 21, 2014, plaintiffs filed a notice of intent to appeal the court's December 20, 2013 order to the United States Court of Appeals for the Second Circuit. Pursuant to a schedule entered by the appeals court, briefing on the appeal was completed on June 23, 2014. The Second Circuit has scheduled an oral argument for December 1, 2014. The underwriters previously named as defendants notified the Company of their intent to seek indemnification from the Company pursuant to their underwriting

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agreement dated May 5, 2011 in regard to the claims asserted in this action.

The first putative stockholder derivative action, a consolidated action captioned In re Green Mountain Coffee Roasters, Inc. Derivative Litigation, Civ. No. 2:10-cv-00233, premised on the same allegations asserted in the now dismissed Horowitz v. Green Mountain Coffee Roasters, Inc., Civ. No. 2:10-cv-00227 securities class action complaint, the LAMPERS action described above, and the now dismissed action captioned Fifield v. Green Mountain Coffee Roasters, Inc., Civ. No. 2:12-cv-00091, is pending in the United States District Court for the District of Vermont before the Honorable William K. Sessions, III. On November 29, 2010, the federal court entered an order consolidating two actions and appointing the firms of Robbins Umeda LLP and Shuman Law Firm as co-lead plaintiffs' counsel. On February 23, 2011, the federal court approved a stipulation filed by the parties providing for a temporary stay of that action until the court rules on defendants' motions to dismiss the consolidated complaint in the Horowitz putative securities fraud class action. On March 7, 2012, the federal court approved a further joint stipulation continuing the temporary stay until the court either denies a motion to dismiss the Horowitz putative securities fraud class action or the Horowitz putative securities fraud class action is dismissed with prejudice. On April 27, 2012, the federal court entered an order consolidating the stockholder derivative action captioned Himmel v. Robert P. Stiller, et al., with two additional putative derivative actions, Musa Family Revocable Trust v. Robert P. Stiller, et al., Civ. No. 2:12-cv-00029, and Laborers Local 235 Benefit Funds v. Robert P. Stiller, et al., Civ. No. 2:12-cv- 00042. On November 14, 2012, the federal court entered an order consolidating an additional stockholder derivative action, captioned Henry Cargo v. Robert P. Stiller, et al., Civ. No. 2:12-cv-00161, and granting plaintiffs leave to lift the stay for the limited purpose of filing a consolidated complaint. The consolidated complaint is asserted nominally on behalf of the Company against certain of its officers and directors. The consolidated complaint asserts claims for breach of fiduciary duty, waste of corporate assets, unjust enrichment, contribution, and indemnification and seeks compensatory damages, injunctive relief, restitution, disgorgement, attorney's fees, costs, and such other relief as the court should deem just and proper. On May 14, 2013, the court approved a joint stipulation filed by the parties providing for a temporary stay of the proceedings until the conclusion of the appeal in the Horowitz putative securities fraud class action. On August 1, 2013, the parties filed a further joint stipulation continuing the temporary stay until the court either denies a motion to dismiss the LAMPERS putative securities fraud class action or the LAMPERS putative securities fraud class action is dismissed with prejudice, which the court approved on August 2, 2013. On February 24, 2014, the court approved a further joint stipulation filed by the parties continuing the temporary stay until the appeals court rules on the pending appeal in the LAMPERS putative securities fraud class action.

The second putative stockholder derivative action, M. Elizabeth Dickinson v. Robert P. Stiller, et al., Civ. No. 818-11-10, is pending in the Superior Court of the State of Vermont for Washington County. On February 28, 2011, the court approved a stipulation filed by the parties similarly providing for a temporary stay of that action until the federal court rules on defendants' motions to dismiss the consolidated complaint in the Horowitz putative securities fraud class action. As a result of the federal court's ruling in the Horowitz putative securities fraud class action, the temporary stay was lifted. On June 25, 2013, plaintiff filed an amended complaint in the action, which is asserted nominally on behalf of the Company against certain current and former directors and

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officers. The amended complaint is premised on the same allegations alleged in the Horowitz, LAMPERS, and Fifield putative securities fraud class actions. The amended complaint asserts claims for breach of fiduciary duty, unjust enrichment, waste of corporate assets, and alleged insider selling by certain of the named defendants. The amended complaint seeks compensatory damages, injunctive relief, restitution, disgorgement, attorneys' fees, costs, and such other relief as the court should deem just and proper. On August 7, 2013, the parties filed a further joint stipulation continuing the temporary stay until the court either denies a motion to dismiss the LAMPERS putative securities fraud class action or the LAMPERS putative securities fraud class action is dismissed with prejudice, which the court approved on August 21, 2013. On April 21, 2014, the court approved a joint stipulation filed by the parties continuing the temporary stay until the appeals court rules on the pending appeal in the LAMPERS putative securities fraud class action.

The Company and the other defendants intend to vigorously defend all the pending lawsuits. Additional lawsuits may be filed and, at this time, the Company is unable to predict the outcome of these lawsuits, the possible loss or range of loss, if any, associated with the resolution of these lawsuits or any potential effect they may have on the Company or its operations.

Antitrust Litigation

On February 11, 2014, TreeHouse Foods, Inc., Bay Valley Foods, LLC, and Sturm Foods, Inc. filed suit against Green Mountain Coffee Roasters, Inc. and Keurig, Inc. in the U.S. District Court for the Southern District of New York (TreeHouse Foods, Inc. et al. v. Green Mountain Coffee Roasters, Inc. et al., No. 1:14-cv-00905-VSB). The TreeHouse complaint asserts claims under the federal antitrust laws and various state laws, contending that the Company has monopolized alleged markets for single serve coffee brewers and single serve coffee portion packs, including through its contracts with suppliers and distributors and in connection with the launch of its next generation coffee brewer. The TreeHouse complaint seeks monetary damages, declaratory relief, injunctive relief, and attorneys' fees.

On March 13, 2014, JBR, Inc. (d/b/a Rogers Family Company) filed suit against Keurig Green Mountain, Inc. in the U.S. District Court for the Eastern District of California (JBR, Inc. v. Keurig Green Mountain, Inc., No. 2:14-cv-00677-KJM-CKD). The claims asserted and relief sought in the JBR complaint are substantially similar to the claims asserted and relief sought in the TreeHouse complaint.

Additionally, beginning on March 10, 2014, twenty-seven putative class actions asserting similar claims and seeking similar relief have been filed on behalf of purported direct and indirect purchasers of the Company's products in various federal district courts. On June 3, 2014, the Judicial Panel on Multidistrict Litigation granted a motion to transfer these various actions, including the TreeHouse and JBR actions, to a single judicial district for coordinated or consolidated pre-trial proceedings. The actions are now pending before Judge Vernon S. Broderick in the Southern District of New York (In re: Keurig Green Mountain Single-Serve Coffee Antitrust Litigation, No. 1:14-md-02542-VSB).

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On June 23, 2014, TreeHouse and JBR filed a joint motion to expedite discovery, which the Court granted in part and denied in part on July 23, 2014. On August 11, 2014, JBR filed a motion for a preliminary injunction, which the Company opposed. The Court held a hearing on September 3-4, 2014, and by order dated September 19, 2014, the Court denied JBR's motion for a preliminary injunction. On September 24, 2014, JBR filed a notice of appeal of the denial of the preliminary injunction. On October 28, 2014, JBR moved to expedite its appeal, and on November 7, 2014, the Company filed an opposition to JBR's motion for expedited treatment. A briefing schedule for the appeal has not yet been set.

Consolidated putative class action complaints by direct purchaser and indirect purchaser plaintiffs were filed on July 24, 2014. The Company filed motions to dismiss these complaints and the complaints in the TreeHouse and JBR actions on October 3, 2014. On October 27, 2014, all plaintiffs informed the Company of their decision to amend their complaints rather than oppose the Company's motions to dismiss. Plaintiffs' amended complaints are due November 25, 2014.

On September 30, 2014, a statement of claim was filed against the Company and Keurig Canada Inc. in Ontario, Canada by Club Coffee L.P. ("Club Coffee"), a Canadian manufacturer of single-serve beverage packs, claiming damages of $600 million and asserting a breach of competition law and false and misleading statements by the Company. On October 21, 2014, Club Coffee filed an amended statement of claim against the Company and Keurig Canada, Inc. claiming the same amount of damages as in the original statement of claim and asserting essentially the same breaches of competition law and false and misleading statements by the Company.

The Company intends to vigorously defend all of the pending lawsuits. At this time, the Company is unable to predict the outcome of these lawsuits, the potential loss or range of loss, if any, associated with the resolution of these lawsuits or any potential effect they may have on the Company or its operations.

Product Liability

In November 2014, the Company informed the U.S. Consumer Product Safety Commission and Health Canada that it identified a potential issue involving certain Keurig MINI Plus (non-reservoir) brewers (K10 and B31 models), where on very rare occasions, hot liquid could escape the brewer. As a result, the Company has recorded a net charge in fiscal 2014 of approximately $10.0 million in its statement of operations. This represents the Company's current best estimate, based on a number of assumptions, of the cost to remediate this issue and related expenses. Included in this charge is the recovery that the Company expects to receive from its insurance carriers where the Company has a legally enforceable contract that stipulates the terms of the insurance coverage and where the terms are not in or expected to be in dispute. Such charge is based on estimates, and therefore, the Company's ultimate liability and recovery may exceed or be less than the amounts recorded. Based on current information known to the Company, the Company believes that this issue will not have a material adverse effect on the consolidated financial position, results of operations or cash flows of the Company.

20.   Related Party Transactions

The Company, from time to time, used travel services provided by Heritage Flight, a charter air services company acquired in September 2002 by Robert P. Stiller, who previously served on the Company's Board of Directors and who is a security holder of

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more than 5% of the Company's Common Stock. For fiscal years 2014, 2013 and 2012 the Company incurred expenses of $0.0 million, $0.2 million, and $0.7 million, respectively, for Heritage Flight travel services.

21.   Earnings Per Share

The following table illustrates the reconciliation of the numerator and denominator of basic and diluted earnings per share computations (dollars in thousands, except share and per share data):

	Fiscal 2014		Fiscal 2013		Fiscal 2012
Numerator for basic and diluted earnings per share:
Net income attributable to Keurig	$	596,518	$	483,232	$	362,628
Denominator:
Basic weighted average shares outstanding		157,085,574		149,638,636		154,933,948
Effect of dilutive securities—stock options		2,482,768		3,162,857		4,141,698
Diluted weighted average shares outstanding		159,568,342		152,801,493		159,075,646
Basic net income per common share	$	3.80	$	3.23	$	2.34
Diluted net income per common share	$	3.74	$	3.16	$	2.28

For the fiscal years 2014, 2013, and 2012, 277,000, 822,000, and 763,000 equity-based awards for shares of common stock, respectively, have been excluded in the calculation of diluted earnings per share because they were antidilutive.

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22.   Unaudited Quarterly Financial Data

The following table presents the quarterly information for fiscal 2014 (dollars in thousands, except per share data). Each fiscal quarter comprises 13 weeks.

Fiscal 2014	December 28, 2013		March 29, 2014		June 28, 2014		September 27, 2014
Net sales	$	1,386,670	$	1,103,072	$	1,022,371	$	1,195,567
Gross profit	$	464,047	$	457,432	$	444,592	$	449,789
Net income attributable to Keurig	$	138,227	$	162,084	$	155,151	$	141,056
Earnings per share:
Basic	$	0.93	$	1.05	$	0.95	$	0.87
Diluted	$	0.91	$	1.03	$	0.94	$	0.86
Dividends paid per share	$	—	$	0.25	$	0.25	$	0.25

The following table presents the quarterly information for fiscal 2013 (dollars in thousands, except per share data). Each fiscal quarter comprises 13 weeks.

Fiscal 2013	December 29, 2012		March 30, 2013		June 29, 2013		September 28, 2013
Net sales	$	1,339,059	$	1,004,792	$	967,072	$	1,047,177
Gross profit	$	419,163	$	415,146	$	407,618	$	377,459
Net income attributable to Keurig	$	107,583	$	132,421	$	116,272	$	126,956
Earnings per share:
Basic	$	0.72	$	0.89	$	0.78	$	0.84
Diluted	$	0.70	$	0.87	$	0.76	$	0.83
Dividends paid per share	$	—	$	—	$	—	$	—

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The following table presents the quarterly information for fiscal 2012 (dollars in thousands, except per share data). Each fiscal quarter comprises 13 weeks, except the fiscal quarter ended September 29, 2012 which is comprised of 14 weeks.

Fiscal 2012	December 24, 2011		March 24, 2012		June 23, 2012		September 29, 2012
Net sales	$	1,158,216	$	885,052	$	869,194	$	946,736
Gross profit	$	336,604	$	313,038	$	303,311	$	316,446
Net income attributable to Keurig	$	104,414	$	93,031	$	73,296	$	91,887
Earnings per share:
Basic	$	0.67	$	0.60	$	0.47	$	0.59
Diluted	$	0.66	$	0.58	$	0.46	$	0.58
Dividends paid per share	$	—	$	—	$	—	$	—

105

Schedule II—Valuation and Qualifying Accounts
For the Fiscal Years Ended
September 27, 2014, September 28, 2013, and September 29, 2012
(Dollars in thousands)

Description	Balance at Beginning of Period		Acquisitions (Dispositions)			Charged to Costs and Expenses		Deductions		Balance at End of Period
Allowance for doubtful accounts:
Fiscal 2014	$	2,886	$	—		$	1,782	$	1,398	$	3,270
Fiscal 2013	$	2,750	$	—		$	689	$	553	$	2,886
Fiscal 2012	$	3,404	$	(299	)	$	3,197	$	3,552	$	2,750

Description	Balance at Beginning of Period		Acquisitions (Dispositions)		Charged to Costs and Expenses		Deductions		Balance at End of Period
Sales returns reserve:
Fiscal 2014	$	30,754	$	—	$	114,057	$	81,961	$	62,850
Fiscal 2013	$	31,767	$	—	$	79,747	$	80,760	$	30,754
Fiscal 2012	$	18,302	$	—	$	107,436	$	93,971	$	31,767

Description	Balance at Beginning of Period		Acquisitions (Dispositions)		Charged to Costs and Expenses		Deductions		Balance at End of Period
Warranty reserve(1):
Fiscal 2014	$	7,804	$	—	$	24,158	$	19,112	$	12,850
Fiscal 2013	$	20,218	$	—	$	6,948	$	19,362	$	7,804
Fiscal 2012	$	14,728	$	—	$	37,390	$	31,900	$	20,218

⁽¹⁾

Includes warranty recoveries from suppliers of $1.8 million, $0.8 million and $8.3 million for fiscal 2014, 2013, and 2012 respectively.

106

Item 9.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A.    Controls and Procedures

Evaluation of Disclosure Controls and Procedures

During the fourth quarter of fiscal 2014, under the supervision of and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Securities and Exchange Act of 1934, as amended (the "Exchange Act"). Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of September 27, 2014, our disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act was recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and were effective.

Management's Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Internal control over financial reporting is a process designed by, or under the supervision of, the issuer's principal executive and principal financial officers, or persons performing similar functions, and effected by issuer's board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of its financial reporting and the preparation of its financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:

•

pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;

•

provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles,

•

provide reasonable assurance that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

•

provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Under the supervision of and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, the Company conducted an evaluation of the effectiveness of its internal control over financial reporting based on the criteria in Internal Control—Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). Based upon that evaluation, management concluded we maintained effective internal controls over financial reporting as of September 27, 2014 based on the criteria established in Internal Control—Integrated Framework (1992) issued by the COSO.

107

The effectiveness of the Company's internal control over financial reporting as of September 27, 2014 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which appears herein.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting during the fiscal quarter ended September 27, 2014 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 9B.    Other Information

None.

108

PART III

Item 10.    Directors, Executive Officers and Corporate Governance

Except for the information regarding the Company's executive officers, the information called for by this Item is incorporated by reference in this report to our definitive Proxy Statement for the Company's Annual Meeting of Stockholders to be held on January 29, 2015, which will be filed not later than 120 days after the close of our fiscal year ended September 27, 2014 (the "Definitive Proxy Statement").

For information concerning the executive officers of the Company, see "Executive Officers of the Registrant" in Part I of this Annual Report on Form 10-K.

Item 11.    Executive Compensation

The information required by this item will be incorporated by reference to the information contained in the Definitive Proxy Statement.

Item 12.    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required by this item will be incorporated by reference to the information contained in the Definitive Proxy Statement.

Item 13.    Certain Relationships and Related Transactions, and Director Independence

The information required by this item will be incorporated by reference to the information contained in the Definitive Proxy Statement.

Item 14.    Principal Accounting Fees and Services

The information required by this item will be incorporated by reference to the information contained in the Definitive Proxy Statement.

109

PART IV

Item 15.    Exhibits, Financial Statement Schedules

Exhibit No.		Exhibit Title
	3.1	Restated Certificate of Incorporation dated November 10, 2011 (incorporated by reference to Exhibit 3.1 in the Annual Report on Form 10-K for the fiscal year ended September 24, 2011).
	3.1.1	Certificate of Amendment to Restated Certificate of Incorporation, dated April 3, 2012 (incorporated by reference to Exhibit 3.1 in the Quarterly Report on Form 10-Q for the thirteen weeks ended March 24, 2012).
	3.1.2	Certificate of Amendment to Restated Certificate of Incorporation, dated March 6, 2014 (incorporated by reference from Exhibit 3.1 to the Company's Form 8-K filed on March 10, 2014).
	3.2	Amended and Restated Bylaws of the Company (incorporated by reference to Exhibit 3.2 in the Annual Report on Form 10-K for the fiscal year ended September 27, 2008).
	3.2.1	Amendment to the Amended and Restated Bylaws of the Company, dated March 7, 2014. (incorporated by reference from Exhibit 3.1 to the Company's Form 8-K filed on March 10, 2014).
	4.1	Amended and Restated Credit Agreement dated as of June 9, 2011 among Green Mountain Coffee Roasters, Inc., Bank of America, N.A., and the other lender parties thereto (incorporated by reference to Exhibit 4.1 in the Quarterly Report on Form 10-Q for the thirteen weeks ended June 25, 2011).
	4.1.1	Amendment No. 1, dated as of March 13, 2012, to that certain Amended and Restated Credit Agreement, dated as of June 9, 2011, among Green Mountain Coffee Roasters, Inc., Bank of America, N.A. and the other lenders party thereto (incorporated by reference to Exhibit 4.1 in the Quarterly Report on Form 10-Q for the thirteen weeks ended March 24, 2012).
	10.1	Amended and Restated Lease Agreement, dated November 6, 2007 between Pilgrim Partnership L.L.C. and Green Mountain Coffee, Inc. (incorporated by reference to Exhibit 10.1 in the Annual Report on Form 10-K for the fiscal year ended September 28, 2007).
	10.2	Green Mountain Coffee Roasters, Inc. Amended and Restated Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.2 in the Quarterly Report on Form 10-Q for the quarter ended March 29, 2008).*
	10.3	1999 Stock Option Plan of the Company (incorporated by reference to Exhibit 10.38 in the Quarterly Report on Form 10-Q for the 16 weeks ended January 16, 1999).*
	10.4	Employment Agreement of Stephen J. Sabol dated as of July 1, 1993 (incorporated by reference to Exhibit 10.41 in the Registration Statement on Form SB-2 (Registration No. 33-66646) filed on July 28, 1993, and declared effective on September 21, 1993).*
	10.5	2000 Stock Option Plan of the Company (incorporated by reference to Exhibit 10.105 in the Annual Report on Form 10-K for the fiscal year ended September 30, 2000).*
	10.6	Green Mountain Coffee Roasters, Inc., Employee Stock Ownership Plan. (incorporated by reference to Exhibit 10.6 in the Annual Report on Form 10-K for the fiscal year ended September 26, 2009).

110

Exhibit No.		Exhibit Title
	10.6.1	Amendment to Green Mountain Coffee Roasters, Inc. Employee Stock Ownership Plan. (incorporated by reference to Exhibit 10.6.1 in the Annual Report on Form 10-K for the fiscal year ended September 26, 2009).
	10.7	Green Mountain Coffee Roasters, Inc., Employee Stock Ownership Trust (incorporated by reference to Exhibit 10.114 in the Annual Report on Form 10-K for the fiscal year ended September 30, 2000).
	10.8	Loan Agreement by and between the Green Mountain Coffee Roasters, Inc., Employee Stock Ownership Trust and Green Mountain Coffee, Inc., made and entered into as of April 16, 2001 (incorporated by reference to Exhibit 10.118 in the Quarterly Report on Form 10-Q for the 12 weeks ended April 14, 2001).
	10.9	2002 Deferred Compensation Plan, as amended (incorporated by reference to Exhibit 10.9 in the Annual Report on Form 10-K for the fiscal year ended September 27, 2008).*
	10.10	Employment Agreement between Green Mountain Coffee Roasters, Inc. and Frances G. Rathke dated as of October 31, 2003 (incorporated by reference to Exhibit 10.6 in the Quarterly Report on Form 10-Q for the quarter ended March 28, 2009).*
	10.11	Letter from Green Mountain Coffee Roasters, Inc. to Frances G. Rathke re: Deferred Compensation Agreement dated as December 7, 2006 (incorporated by reference to Exhibit 10.11 in the Annual Report on Form 10-K for the fiscal year ended September 27, 2008).*
	10.12	Lease Agreement dated November 15, 2005 between Pilgrim Partnership, LLC and the Company (incorporated by reference to Exhibit 10.21 in Annual Report on Form 10-K for the fiscal year ended September 24, 2005).
	10.13	Amended and Restated Green Mountain Coffee Roasters, Inc. 2006 Incentive Plan (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on March 16, 2010).*
		(a) Form of Stock Option Agreement (incorporated by reference to Exhibit 10.13(a) in the Annual Report on Form 10-K for the fiscal year ended September 24, 2011).*
		(b) Form of Director Stock Option Agreement under the Amended and Restated Green Mountain Coffee Roasters, Inc. 2006 Incentive Plan (incorporated by reference to Exhibit 10.2 in the Quarterly Report on Form 10-Q for the thirteen weeks ended March 30, 2013).*
		(c) Form of Executive Stock Option Agreement under the Amended and Restated Green Mountain Coffee Roasters, Inc. 2006 Incentive Plan (incorporated by reference to Exhibit 10.3 in the Quarterly Report on Form 10-Q for the thirteen weeks ended March 30, 2013).*
		(d) Form of Director Restricted Stock Unit Agreement under the Amended and Restated Green Mountain Coffee Roasters, Inc. 2006 Incentive Plan (incorporated by reference to Exhibit 10.4 in the Quarterly Report on Form 10-Q for the thirteen weeks ended March 30, 2013).*
		(e) Form of Executive Restricted Stock Unit Agreement under the Amended and Restated Green Mountain Coffee Roasters, Inc. 2006 Incentive Plan (incorporated by reference to Exhibit 10.5 in the Quarterly Report on Form 10-Q for the thirteen weeks ended March 30, 2013).*
		(f) Form of Performance Stock Unit Award Agreement under the Amended and Restated Green Mountain Coffee Roasters, Inc. 2006 Incentive Plan (incorporated by reference to Exhibit 10.6 in the Quarterly Report on Form 10-Q for the thirteen weeks ended March 30, 2013).*

111

Exhibit No.		Exhibit Title
	10.14	Keurig, Incorporated 2005 Stock Option Plan (incorporated by reference to Exhibit 4.2 to the Registration Statement on Form S-8 filed on June 22, 2006).*
	10.15	Lease Agreement dated August 16, 2007 between Keurig, Incorporated and Brookview Investments, LLC. (incorporated by reference to Exhibit 10.29 to the Annual Report on Form 10-K for the year ended September 28, 2007).
	10.16	2008 Change-In-Control Severance Benefit Plan (incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q for the quarter ended March 29, 2008).
	10.17	Green Mountain Coffee Roasters, Inc. Senior Executive Officer Short Term Incentive Compensation Plan (incorporated by reference to Appendix D of the Definitive Proxy Statement for the March 13, 2008 Annual Meeting of Stockholders).*
	10.18	Agreement of Sale dated June 2, 2008 by and between MS Plant, LLC and Green Mountain Coffee Roasters, Inc. (incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q for the quarter ended June 28, 2008).
	10.19	Settlement and License Agreement dated October 23, 2008 by and between Keurig, Incorporated and Kraft Foods Inc., Kraft Foods Global Inc., and Tassimo Corporation (incorporated by reference to Exhibit 10.27 in the Annual Report on Form 10-K for the fiscal year ended September 27, 2008).
	10.20	Letter from Green Mountain Coffee Roasters, Inc. to Scott McCreary re: Offer Letter dated as September 10, 2004 (incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q for the quarter ended December 27, 2008).*
	10.21	Letter from Green Mountain Coffee Roasters, Inc. to Howard Malovany re: Offer Letter dated as January 8, 2009 (incorporated by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q for the quarter ended March 28, 2009).*
	10.22	Letter from Green Mountain Coffee Roasters, Inc. to Michelle Stacy re: Offer Letter dated as March 16, 2009 (incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q for the quarter ended March 28, 2009).*
	10.23	Letter from Green Mountain Coffee Roasters, Inc. to Scott McCreary re: Letter Amendment dated as December 29, 2008 (incorporated by reference to Exhibit 10.3 to the Quarterly Report on Form 10-Q for the quarter ended March 28, 2009).*
	10.24	Letter from Green Mountain Coffee Roasters, Inc. to Steve Sabol re: Letter Amendment dated as December 31, 2008 (incorporated by reference to Exhibit 10.5 to the Quarterly Report on Form 10-Q for the quarter ended March 28, 2009).*
	10.25	Share Purchase Agreement dated November 13, 2009 by and between Timothy's Coffees of the World, Inc., World Coffee Group S.á.r.l., Green Mountain Coffee Roasters, Inc. and Timothy's Acquisition Corporation (incorporated by reference to Exhibit 2.1 on Form 8-K filed on November 13, 2009).
	10.26	Common Stock Purchase Agreement dated August 10, 2010 by and between Luigi Lavazza S.p.A. and Green Mountain Coffee Roasters, Inc. (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on August 11, 2010).

112

Exhibit No.		Exhibit Title
	10.27	Registration Rights Agreement dated September 28, 2010 by and between Luigi Lavazza S.p.A. and Green Mountain Coffee Roasters, Inc. (incorporated by reference to Exhibit 10.29 in the Annual Report on Form 10-K for the fiscal year ended September 25, 2010).
	10.28	Form of Indemnification Agreement by and between the Directors of Green Mountain Coffee Roasters, Inc. and Green Mountain Coffee Roasters, Inc. (incorporated by reference to Exhibit 10.30 in the Annual Report on Form 10-K for the fiscal year ended September 25, 2010).
	10.29	Form of Indemnification Agreement by and between the Executive Officers of Green Mountain Coffee Roasters, Inc. and Green Mountain Coffee Roasters, Inc. (incorporated by reference to Exhibit 10.31 in the Annual Report on Form 10-K for the fiscal year ended September 25, 2010).
	10.30	Share Purchase Agreement dated September 14, 2010 by and between LJVH S.á.r.l., Fonds de solidarité des Travailleurs du Québec (F.T.Q.), LJ Coffee Agent, LLC, Green Mountain Coffee Roasters, Inc., and SSR Acquisition Corporation (incorporated by reference to Exhibit 10.32 in the Annual Report on Form 10-K for the fiscal year ended September 25, 2010).
	10.31	Common Stock Purchase Agreement dated May 6, 2011 by and between Luigi Lavazza S.p.A. and Green Mountain Coffee Roasters. Inc. (incorporated by reference to Exhibit 10.1 on Form 8-K filed on May 6, 2011).
	10.32	Amendment dated May 18, 2011 to Common Stock Purchase Agreement dated August 10, 2010 by and between Luigi Lavazza S.p.A. and Green Mountain Coffee Roasters, Inc. (incorporated by reference to Exhibit 10.34 in the Annual Report on Form 10-K for the fiscal year ended September 24, 2011)
	10.33	Letter from Green Mountain Coffee Roasters, Inc. to Stephen L. Gibbs re: Offer Letter dated as July 20, 2011 (incorporated by reference to Exhibit 10.1 on Form 8-K filed on August 22, 2011).*
	10.34	Employment Agreement dated February 1, 2012 between Green Mountain Coffee Roasters, Inc. and Lawrence J. Blanford (incorporated by reference to Exhibit 10.36 on Form 10-K for the fiscal year ended September 29, 2012).*
	10.35	Second Amendment dated February 23, 2012 to Common Stock Purchase Agreement dated August 10, 2010 by and between Luigi Lavazza S.p.A. and Green Mountain Coffee Roasters, Inc. (incorporated by reference to Exhibit 10.2 in the Quarterly Report on Form 10-Q for the thirteen weeks ended March 24, 2012).
	10.36	Lease Agreement dated June 19, 2012 between Burlington Crossing Realty Trust and the Company (incorporated by reference to Exhibit 10.1 in the Quarterly Report on Form 10-Q for the thirteen weeks ended June 23, 2012).
	10.37	Lease Agreement dated March 21, 2011 between 124 Technology Park Way, LLC and the Company (incorporated by reference to Exhibit 10.2 in the Quarterly Report on Form 10-Q for the thirteen weeks ended June 23, 2012).
	10.38	Employment Agreement dated October 15, 2012 between Green Mountain Coffee Roasters, Inc. and Gerard Geoffrion (incorporated by reference to Exhibit 10.40 in the Annual Report on Form 10-K for the fiscal year ended September 29, 2012).*
	10.39	Employment Agreement dated October 15, 2012 between Green Mountain Coffee Roasters, Canada and Sylvain Toutant (incorporated by reference to Exhibit 10.41 in the Annual Report on Form 10-K for the fiscal year ended September 29, 2012).*

113

Exhibit No.		Exhibit Title
	10.40	Employment Agreement dated November 16, 2012 between Green Mountain Coffee Roasters, Inc. and Brian P. Kelley (incorporated by reference to Exhibit 10.1 in the Report on Form 8-K filed on November 20, 2012).*
	10.41	Transition Agreement between Green Mountain Coffee Roasters, Inc. and Howard Malovany, dated December 13, 2012 (incorporated by reference to Exhibit 10.1 in the Quarterly Report on Form 10-Q for the thirteen weeks ended December 29, 2012).*
	10.42	Amendment No. 1 to Green Mountain Coffee Roasters, Inc. 2008 Change-in-Control Severance Benefit Plan (incorporated by reference to Exhibit 10.1 in the Quarterly Report on Form 10-Q for the thirteen weeks ended March 30, 2013).*
	10.43	Transition Agreement between Green Mountain Coffee Roasters, Inc., and Scott McCreary, dated May 23, 2013 (incorporated by reference to Exhibit 10.1 in the Quarterly Report on Form 10-Q for the thirteen weeks ended June 29, 2013).* .
	10.44	Consultancy Agreement between Green Mountain Coffee Roasters, Inc., and Robert Stiller, dated June 19, 2013 (incorporated by reference to Exhibit 10.2 in the Quarterly Report on Form 10-Q for the thirteen weeks ended June 29, 2013).*
	10.45	Consultancy Agreement between Green Mountain Coffee Roasters, Inc., and Larry Blanford, dated June 19, 2013 (incorporated by reference to Exhibit 10.3 in the Quarterly Report on Form 10-Q for the thirteen weeks ended June 29, 2013).*
	10.46	Transition Agreement between Green Mountain Coffee Roasters, Inc. and Michelle Stacy, dated August 21, 2013. (incorporated by reference to Exhibit 10.46 in the Annual Report on Form 10-K for the fiscal year ended September 28, 2013).*
	10.47	Offer Letter between Green Mountain Coffee Roasters, Inc. and Robert P. Ostryniec, dated August 4, 2013 (incorporated by reference to Exhibit 10.47 in the Annual Report on Form 10-K for the fiscal year ended September 28, 2013).*
	10.48	Letter Agreement between Green Mountain Coffee Roasters, Inc., and Gerard Geoffrion, dated October 10, 2013 (incorporated by reference to Exhibit 10.1 in the Quarterly Report on Form 10-Q for the thirteen weeks ended December 28, 2013).
	10.49	Second Amendment to the Keurig Green Mountain, Inc. 2002 Deferred Compensation Plan (incorporated by reference to Exhibit 10.1 in the Quarterly Report on Form 10-Q for the thirteen weeks ended June 28, 2014).*
	10.50	Amendment to Consulting Agreement between Keurig Green Mountain, Inc. and Robert P. Stiller, dated June 14, 2014 (incorporated by reference to Exhibit 10.2 in the Quarterly Report on Form 10-Q for the thirteen weeks ended June 28, 2014).*
	10.51	Keurig Green Mountain 2014 Omnibus Incentive Plan (incorporated by reference from Exhibit 10-1 to the Company's Form S-8 filed on March 6 2014).*
		(a) Form of Performance Stock Unit agreement for Keurig Green Mountain, Inc. 2014 Omnibus Incentive Plan (incorporated by reference from Exhibit 10.3 to the Company's Form S-8 filed on March 6, 2014).*

114

Exhibit No.		Exhibit Title
		(b) Form of Director Restricted Stock Unit agreement for Keurig Green Mountain, Inc. 2014 Omnibus Incentive Plan (incorporated by reference from Exhibit 10.4 to the Company's Form S-8 filed on March 6, 2014).*
		(c) Form of Executive Restricted Stock Unit agreement for Keurig Green Mountain, Inc. 2014 Omnibus Incentive Plan (incorporated by reference from Exhibit 10.5 to the Company's Form S-8 filed on March 6, 2014).*
		(d) Form of Executive Stock Option Agreement for Keurig Green Mountain, Inc. 2014 Omnibus Incentive Plan (incorporated by reference from Exhibit 10.6 to the Company's Form S-8 filed on March 6, 2014).*
	10.52	Keurig Green Mountain, Inc. 2014 Amended and Restated Employee Stock Purchase Plan (incorporated by reference from Exhibit 10.2 to the Company's Form S-8 filed on March 6, 2014).*
		(a) Form of Participation Agreement for Keurig Green Mountain, Inc. 2014 Amended and Restated Employee Stock Purchase Plan (incorporated by reference from Exhibit 10.7 to the Company's Form S-8 filed on March 6, 2014).*
	10.53	Second Amendment to Keurig Green Mountain, Inc. 2014 Amended and Restated Employee Stock Purchase Plan, dated September 11, 2014.*
	10.54	Common Stock Purchase Agreement, dated as of February 5, 2014, by and between Green Mountain Coffee Roasters, Inc. and Atlantic Industries (incorporated by reference from Exhibit 10.1 to the Company's Form 8-K filed on February 5, 2014).
	10.55	Common Stock Purchase Agreement, dated as of March 28, 2014, by and between Keurig Green Mountain, Inc. and Luigi Lavazza S.p.A. (incorporated by reference from Exhibit 10.1 to the Company's Form 8-K filed on March 31, 2014).
	10.56	Keurig Green Mountain Non-Qualified Plan.*
	21	Subsidiary List.
	23	Consent of PricewaterhouseCoopers LLP.
	31.1	Principal Executive Officer Certification Pursuant to Securities Exchange Act Rules 13a-14 and 15d-14 as Adopted Pursuant to the Section 302 of the Sarbanes-Oxley Act of 2002.
	31.2	Principal Financial Officer Certification Pursuant to Securities Exchange Act Rules 13a-14 and 15d-14 as Adopted Pursuant to the Section 302 of the Sarbanes-Oxley Act of 2002.
	32.1	Principal Executive Officer Certification Pursuant 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
	32.2	Principal Financial Officer Certification Pursuant 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

115

Exhibit No.		Exhibit Title
	101	The following financial statements from the Company's Annual Report on Form 10-K for the fiscal year ended September 27, 2014 formatted in eXtensible Business Reporting Language (XBRL): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Stockholders' Equity, (iv) the Consolidated Statements of Comprehensive Income (v) the Consolidated Statements of Cash Flows and (vi) related notes.

*

Management contract or compensatory plan

116

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities and Exchange Act of 1934, the Registrant caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

KEURIG GREEN MOUNTAIN, INC.

By:
/s/ Frances G. Rathke
FRANCES G. RATHKE
Chief Financial Officer and Treasurer
Date: November 19, 2014

Pursuant to the requirements of the Securities and Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Brian P. Kelley BRIAN P. KELLEY	President, Chief Executive Officer and Director (Principal Executive Officer)	November 19, 2014
/s/ Frances G. Rathke FRANCES G. RATHKE	Chief Financial Officer and Treasurer (Principal Financial Officer)	November 19, 2014
/s/ Stephen L. Gibbs STEPHEN L. GIBBS	Chief Accounting Officer (Principal Accounting Officer)	November 19, 2014
/s/ Norman H. Wesley NORMAN H. WESLEY	Chairman of the Board of Directors	November 19, 2014
/s/ Barbara Carlini BARBARA CARLINI	Director	November 19, 2014
/s/ Jules A. del Vecchio JULES A. DEL VECCHIO	Director	November 19, 2014
/s/ John D. Hayes JOHN D. HAYES	Director	November 19, 2014
/s/ José Octavio Reyes Lagunes JOSÉ O. LAGUNES	Director	November 19, 2014
/s/ A.D. David Mackay A.D. DAVID MACKAY	Director	November 19, 2014
/s/ Michael J. Mardy MICHAEL J. MARDY	Director	November 19, 2014
/s/ Hinda Miller HINDA MILLER	Director	November 19, 2014
/s/ David E. Moran DAVID E. MORAN	Director	November 19, 2014
/s/ Susan Saltzbart Kilsby SUSAN SALTZBART KILSBY	Director	November 19, 2014
/s/ Robert A. Steele ROBERT A. STEELE	Director	November 19, 2014

117

EX-10.53

Exhibit 10.53

SECOND AMENDMENT TO

KEURIG GREEN MOUNTAIN, INC.

2014 AMENDED AND RESTATED EMPLOYEE STOCK PURCHASE PLAN

This SECOND AMENDMENT TO KEURIG GREEN MOUNTAIN, INC.’S 2014 AMENDED AND RESTATED EMPLOYEE STOCK PURCHASE PLAN (the “Second Amendment”) is entered into as of the 11th day of September, 2014 by Keurig Green Mountain, Inc., a Delaware corporation (the “Company”).

WHEREAS, the Company (formerly Green Mountain Coffee Roasters, Inc.) amended and restated, effective March 6, 2014, the Company’s Amended and Restated Employee Stock Purchase Plan (the “Plan”);

WHEREAS, on March 6, 2014, the Compensation and Organizational Development Committee of the Board of Directors (the “Committee”) amended the Plan to replace the name “Green Mountain Coffee Roasters, Inc.” with “Keurig Green Mountain, Inc.” (the “First Amendment”); and

WHEREAS, at a meeting of the Committee held on September 11, 2014, the Committee approved an amendment to the Plan to incorporate a holding period as set forth more fully in this Second Amendment.

NOW, THEREFORE, in order to implement the changes to the Plan as approved by the Committee, the Company hereby amends the Plan as follows:

1.The heading of Article 5 is hereby amended and restated to read in its entirety, “Article 5 — Stock Subject to the Plan; Holding Period.”

2.Article 5 is hereby amended to add a new second paragraph:

“Beginning with the Payment Period commencing on March 27, 2016 and ending on September 24, 2016, and for all subsequent Payment Periods unless otherwise determined by the Committee, all shares of Common Stock purchased under the Plan are subject to a one-year holding requirement from the last Trading Day of the applicable Payment Period (each such period, a “Required Holding Period”).  In the event a Participant sells shares of Common Stock purchased under the Plan prior to the expiration of the applicable Required Holding Period, such Participant shall not be entitled to enroll in the two Payment Periods immediately subsequent to such sale.”

3.In all other respects, the Plan is hereby confirmed and ratified in its entirety.

KEURIG GREEN MOUNTAIN, INC.

/s/ Michael J. Degnan

Michael J. Degnan

Chief Legal Officer, Corporate General Counsel and Secretary

EX-10.56

Exhibit 10.56

KEURIG GREEN MOUNTAIN, INC.

NON-QUALIFIED PLAN

(Effective January 1, 2015)

KEURIG GREEN MOUNTAIN, INC.
NON-QUALIFIED PLAN

This unfunded deferred compensation plan known as the Keurig Green Mountain, Inc. Non-Qualified Plan (the “Plan”) is adopted effective January 1, 2015, by Keurig Green Mountain, Inc.  (the “Company”).

ARTICLE I

DEFINITIONS

For purposes of this Plan, the following words and phrases shall have the following meanings unless a different meaning is plainly required by the context.

Sec. 1.01“Account” means each account established on the books of the Employer to reflect the balance of Plan benefits attributable to a Participant.

Sec. 1.02“Cause” shall have the meaning given such term under the Keurig Green Mountain, Inc. 2014 Omnibus Incentive Plan.

Sec. 1.03“Code” means the Internal Revenue Code of 1986, as may be further amended from time to time.

Sec. 1.04“Compensation” means an Eligible Employee’s base salary and cash incentive bonus compensation paid by an Employer to a Participant during a Plan Year which exceeds the limit set forth in Code Section 401(a)(17) for such Plan Year.

Sec. 1.05“Committee” means the Retirement Committee under the Keurig Green Mountain 401(k) and Profit Sharing Plan.

Sec. 1.06“Crediting Date” means, with respect to a Plan Year, the date occurring within sixty (60) days following the end of such Plan Year on which the Committee determines to credit an Employer Credit to the Accounts of Eligible Employees.

Sec. 1.07“Disability” means any physical or mental condition for which a Participant shall be eligible to receive benefits under the Employer’s long-term disability program.

Sec. 1.08“Eligible Employee” means each Employee of the Employer who is (i) an Employee of the Employer with a title of Vice President or higher and (ii) designated by the Committee, in its sole discretion, as eligible to participate in the Plan.

Sec. 1.09“Employee” means any individual who is receiving remuneration for personal services rendered to the Employer (or would be receiving such remuneration except for an Authorized Leave of Absence) in the capacity of an “employee” as defined in Section 3121(d)(1) or (2) of the Code (as opposed to that of an independent contractor).

Sec. 1.10“Employer” means the Company and any other entity that adopts this Plan with the consent of the Company.

Sec. 1.11“Employer Credit” means with respect to a Plan Year, the amount to be treated as credited to an Eligible Employee’s Account pursuant to Section 3.01.

Sec. 1.12“Investment Fund(s)” means the investment option(s) available, if any, as determined by the Committee, which serve as a means to measure value increases or decreases with respect to a Participant’s Account.  The Committee reserves the right, on a prospective basis, to add or delete Investment Funds.  The Committee shall not be required to make available the same Investment Fund(s) to each Participant or to make any Investment Fund available.

Sec. 1.13“Participant” means any Eligible Employee who has an amount credited to an Account under this Plan.

Sec. 1.14“Plan” means the Keurig Green Mountain, Inc. Non-Qualified Plan as described in this instrument, and as may be amended from time to time.

Sec. 1.15“Plan Year” means the calendar year.

Sec. 1.16“Retirement Eligible” means the attainment of age 55 with 15 Years of Service or age 60 with 5 Years of Service.

Sec. 1.17“Termination of Employment” means a “separation from service” from the Employer as that term is defined under Code Section 409A.

Sec. 1.18“Unforeseeable Financial Emergency” shall mean an unanticipated emergency that is caused by an event beyond the control of the Participant that would result in severe financial hardship to the Participant resulting from (i) a sudden and unexpected illness or accident of the Participant or a dependent (as defined in Code Section 152(a)) of the Participant, (ii) a loss of the Participant’s property due to casualty, or (iii) such other extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant, all as determined in the sole discretion of the Committee.

Sec. 1.19“Valuation Date” means each business day.

Sec. 1.20“Year of Service” shall have the meaning given such term under the Keurig Green Mountain 401(k) and Profit Sharing Plan.

ARTICLE II

PARTICIPATION IN THE PLAN

Sec. 2.01Commencement of Participation.  Each Employee who, in the sole discretion of the Committee, is designated as an Eligible Employee shall become a Participant at such time that he/she is credited with an Employer Credit as provided in Section 3.01.  No person shall have any right to participate in the Plan.  Any person selected as an Eligible

Employee by the Committee during any Plan Year will not by virtue of such selection have the right to be selected as an Eligible Employee for any other Plan Year.

Sec. 2.02Cessation of Active Participation.

(a)Cessation of Eligible Status.  A Participant shall be considered an “Active Participant” during any period when Employer Credits are being made to the Plan on his or her behalf.  A Participant’s active participation in the Plan shall cease as of the date he or she has a Termination of Employment.  In addition, the Committee may remove a Participant from active participation in the Plan as it may, in its sole discretion, determine.  Upon cessation of, or removal from, active participation in the Plan, a Participant’s prospective Employer Credits under the Plan shall cease.

(b)Inactive Participant Status.  Even if his or her active participation in the Plan ends, an individual shall remain an “Inactive Participant” in the Plan until the earlier of (i) the date the full amount of his or her Account is distributed from the Plan, or (ii) the date he or she again recommences active participation in the Plan as an Eligible Employee as determined by the Committee.  During the period of time that an Employee is an Inactive Participant in the Plan, his or her Account shall continue to be credited with earnings pursuant to the terms of Section 3.04.

ARTICLE III

EMPLOYER CREDITS AND VESTING

Sec. 3.01Employer Credits.

(a)For each Plan Year, the Committee shall provide an Employer Credit to each person who was an Eligible Employee with respect to such Plan Year; provided, that such Eligible Employee does not have a Termination of Employment prior to the Crediting Date for such Plan Year.  The amount of the Employer Credit to be made to the Account of an Eligible Employee under this Section 3.01 with respect to a Plan Year shall be equal to such Eligible Employee’s Compensation for the Plan Year multiplied by the percentage of compensation used to determining such Participant’s maximum employer matching contribution under the Keurig Green Mountain 401(k) and Profit Sharing Plan for the Plan Year.

(b)Notwithstanding Section 3.01(a), if an Eligible Employee has a Termination of Employment following the end of the Plan Year, but prior to the Crediting Date for such Plan Year as a result of death, Disability, a Termination of Employment after becoming Retirement Eligible or a Termination of Employment by the Employer without Cause, such Eligible Employee shall still be entitled to a full Employer Credit for such Plan Year and if an Eligible Employee has a Termination of Employment prior to the end of the Plan Year as a result of death, Disability, a Termination of Employment after becoming Retirement Eligible or a Termination of Employment by the Employer without Cause, such Eligible Employee shall be entitled to a pro rated Employer Credit for such Plan Year based on the number days during such Plan Year during which the Eligible Employee was employed.

Sec. 3.02Vesting of Accounts.  A Participant shall become vested in his or her Account as follows:

Participant’s Years of Service	Vested Percentage
Less than 2 Years of Service	0	%
2 or more Years of Service	100	%

Sec. 3.03Maintenance of Account.The Committee shall establish and maintain an Account for each Participant.  As of each Valuation Date, each Account shall be credited or debited, as applicable, with the following:  (a) Employer allocations under Section 3.01; (b) deemed investment earnings or losses on Employer allocations less expenses allocable to the Account; and (c) any payments made by the Employer pursuant to the terms of this Plan.  For purposes of clause (b) above, deemed investment earnings or losses less expenses shall mean the earnings and losses, less expenses, of those investments designated by the Committee from time to time to measure the investment experience of the Account, or if applicable, the earnings and losses, less expenses, of the Investment Fund(s).

Sec. 3.04Directed Adjustment of Accounts.  If authorized by the Committee, a Participant may suggest by written instruction delivered to the Committee (or such other form permitted by the Committee) that his/her Account be valued as if it were invested in one or more of the Investment Fund(s).  The Committee may disregard the suggestion of the Participant if it is determined that such direction will jeopardize the tax status of this Plan.  A Participant may change his/her selection of Investment Fund(s) at such times as permitted by the Committee.  Any such change, which must be submitted to the Committee in writing (or such other form permitted by the Committee), shall become effective at such time as designated by the Committee.  The right to suggest investment direction options shall in no way be interpreted to give the Participant any greater claim to his/her Account than that which has been granted to the Participant by the terms of this Plan.

If a Participant who is authorized to suggest Investment Fund(s) fails to file an Investment Fund selection instruction, he/she shall be deemed to have selected the default Investment Fund selected from time to time by the Committee.

Sec. 3.05Participant’s Interest in Account.  A Participant shall not acquire any property interest in his/her Account or any other assets of the Employer, his/her right being limited to his/her Employer’s contractual promise to make the payments pursuant to the terms of this Plan.  To the extent that a Participant becomes entitled to receive any amount credited to an Account, his/her right shall be no greater than the right of any unsecured creditor of his/her Employer.  An Employer’s obligations under this Plan are not funded or secured in any way.  Any and all payments made to a Participant pursuant to this Plan shall be made only from the general assets of his/her Employer which may, for this purpose, include a payment from a rabbi trust.  The Account shall be for bookkeeping purposes only and shall not represent a claim against any specified assets of the Employer.  Neither this Plan nor any action taken pursuant to the terms of this Plan shall be considered (a) to create a fiduciary relationship between the Employer (or the Committee) and a Participant or any other persons or (b) to establish a trust in which the assets are beyond the claims of any unsecured creditor of the Employer.

Sec. 3.06Investment Obligation of the Employer.  Benefits are payable as they become due regardless of any actual investments the Employer may make to meet its obligations under this Plan.  Neither the Employer nor any trustee (in the event the Employer elects to use a grantor trust to accumulate funds) shall be obligated to purchase or maintain any asset to fund benefits under the Plan.

ARTICLE IV

PAYMENT OF BENEFITS

Sec. 4.01Form of Payment.  No later than 30 days after the date on which an Eligible Employee first becomes an Eligible Employee, such Eligible Employee shall submit an election to the Committee which shall indicate the form of payment in which the Participant’s Account shall be distributed to the Participant in the event of the Participant’s Termination of Employment (other than as a result of death).  For this purpose, a Participant may elect a single lump sum payment or annual installments over a period of five, ten or fifteen years.  If annual installments are selected, the amount of each annual installment shall be equal to the balance of the applicable Account at the most recent Valuation Date divided by the number of installments remaining to be paid.  Each installment shall be considered a separate payment for purposes of Code Section 409A.  If a Participant fails to indicate the form of payment for his or her Account, such Account shall be distributed as a single lump sum payment.  Notwithstanding any election made by a Participant, (i) if such Participant has a Termination of Employment (other than as a result of death) prior to becoming Retirement Eligible, such Participant’s Account shall be distributed as single lump sum payment in accordance with Section 4.03(a) or (ii) if, at the time a Participant’s Account has become distributable in accordance with Section 4.03(a) or Section 4.04(a), the present value of such Account is less than fifty thousand dollars ($50,000.00), the Participant’s Account balance shall be distributed to the Participant or the Participant’s designated beneficiary, as the case may be, in a single lump sum.

Sec. 4.02Unforeseeable Financial Emergency.  If the Participant experiences an Unforeseeable Financial Emergency, the Participant may petition the Committee to receive a payout from the Plan.  The payout shall not exceed the lesser of the Participant’s Account, calculated on the date of payment, or the amount reasonably needed to satisfy the Unforeseeable Financial Emergency plus taxes reasonably anticipated as a result of the payout.  However, no payout will be allowed under this Section 4.02 to the extent that the Unforeseeable Financial Emergency may be relieved through reimbursement or compensation by insurance or otherwise, or by liquidation of the Participant’s assets (to the extent such liquidation would not itself cause a severe financial hardship).  If, subject to the sole discretion of the Committee, the petition for a payout is approved the payout shall be paid in a lump sum, within 20 business days following the date of approval.

Sec. 4.03Termination of Employment

(a)General.  Upon a Participant’s Termination of Employment (other than as a result of death), and subject to Section 4.01, such Participant’s Account (as adjusted for earnings as of the most recent Valuation Date prior to distribution) shall be distributed or commence distribution to the Participant on the next occurring January 1 or July 1 following the

expiration of the six month anniversary of the date of the Participant’s Termination of Employment.

(b)Changes to Form of Payment.  A Participant’s election to receive payment of his or her Account in the form of a lump sum or in the form of installment payments upon Termination of Employment can be changed at any time by the Participant by written notice delivered to the Committee or its designee; provided, that (i) for any election made subsequent to the Distribution Election required under Section 4.01 to be effective, it must be made at least 12 months before the Participant’s Termination of Employment, (ii) any new election must not be effective for at least 12 months after it is delivered to the Committee, and (iii) any distribution of the Participant’s Account shall not be made or commence earlier than five years after such Participant’s Termination of Employment.

Sec. 4.04Death of a Participant.  If a Participant dies prior to commencing distribution of his or her Account in accordance with Section 4.03, the balance of his or her Account will be distributed to such Participant’s designated beneficiary in the form of a single lump sum within 90 days following the date of the Participant’s death.  If a Participant dies after commencing distribution of his or her Account in accordance with Section 4.03, then subject to Section 4.01, the remaining balance of his or her Account will be payable to the Participant’s designated beneficiary in the form in which payment commenced under Section 4.03 and the Participant’s death shall not accelerate payment of such Participant’s Account.

Sec. 4.05Distribution of Accounts.  The payment of any portion of the Account of a Participant from a rabbi trust shall satisfy the payment obligation of his/her Employer under this Plan to the extent of such payment.

Sec. 4.06Tax Withholding.  An Employer may make such provisions and take such actions as it may deem necessary or appropriate for the withholding of any taxes which the Employer is required by any law or regulation of any governmental authority, including foreign, federal, state or local, to withhold in connection with any benefits under this Plan, including, but not limited to, the withholding of appropriate sums from any amount otherwise payable to the Participant.  Each Participant, however, shall be responsible for the payment of all individual tax liabilities relating to any such benefits.

Sec. 4.07Beneficiary Designation.  Participants shall designate, in such form and manner as the Committee may periodically determine, and from time to time may re-designate, their primary and secondary beneficiaries to receive any benefits that may be payable under the Plan upon such Participant’s death.  In the event that:

(i)a Participant dies without designating a beneficiary; or

(ii)the primary and secondary beneficiaries designated by a Participant are not alive when a payment is to be made to such person(s) under the Plan, and no other contingent beneficiary has been designated; or

(iii)the beneficiary(ies) designated by a Participant cannot be located by the Committee within one year from the date benefits are to be paid to such person(s);

then, in any of such events, the beneficiary of such Participant with respect to any benefits that remain payable under the Plan shall be the Participant’s surviving spouse, if any, and if not, the estate of the Participant.

Sec. 4.08Non-U.S. Participants.  Notwithstanding anything in the Plan to the contrary, with respect to any Participant or eligible person who is resident outside of the United States, the Committee may, in its sole discretion, amend the terms of the Plan in order to conform such terms with the requirements of local law or to meet the objectives of the Plan.  The Committee may, where appropriate, establish one or more sub-plans for this purpose.

ARTICLE V

ADMINISTRATION

Sec. 5.01Committee’s Responsibilities.  The Committee is responsible for the day-to-day administration of this Plan. The Committee may appoint other persons or entities to perform certain of its functions.  The Committee and any such appointee may employ advisors and other persons necessary or convenient to assist with the administration of this Plan.  The Committee shall have the right to remove any such appointee from his/her position.  Any person, group of persons or entity may serve in more than one capacity.

Sec. 5.02Committee’s Specific Powers and Duties.  In addition to any powers, rights and duties set forth elsewhere in this Plan, the Committee shall have the following powers and duties:

(a)to adopt such rules and regulations consistent with the provisions of this Plan;

(b)to enforce this Plan in accordance with its terms and any rules and regulations it establishes;

(c)to maintain records concerning this Plan sufficient to prepare reports, returns and other information required by this Plan or by law;

(d)to construe and interpret this Plan and to resolve all questions arising under the Plan;

(e)to direct the payment of benefits under this Plan, and to give such other directions and instructions as may be necessary for the proper administration of this Plan;

(f)to be responsible for the preparation, filing and disclosure on behalf of this Plan of such documents and reports as are required by any applicable federal or state law; and

(g)to engage assistants and professional advisors.

Sec. 5.03Construction of the Plan.  The Committee shall take such steps as are considered necessary and appropriate to remedy any inequity that results from incorrect information received or communicated in good faith or as the consequence of an administrative error.  The Committee shall have the sole and absolute discretion to interpret this Plan and shall resolve all questions arising in the administration, interpretation and application of this Plan.  It shall endeavor to act, whether by general rules or by particular decisions, so as not to discriminate in favor of, or against, any person and so as to treat all persons in similar circumstances uniformly.  The Committee shall correct any defect, reconcile any inconsistency, or supply any omission with respect to this Plan.  All such corrections, reconciliations, interpretations and completions of Plan provisions shall be final and binding upon the parties.

Sec. 5.04Liability.  The Committee shall not be liable to any person for any action taken or omitted in connection with the administration of this Plan unless attributable to its own fraud or willful misconduct.

ARTICLE VI

CLAIMS PROCEDURE

Sec. 6.01Claims.  The Committee will endeavor to administer the Plan fairly and consistently and to pay all benefits to which participants or beneficiaries are properly entitled.  All claims for unpaid benefits should be made in writing to the Committee.  The Committee may request additional information necessary to consider the claim further.  If a claim is wholly or partially denied, the Committee will notify the claimant of the adverse decision within a reasonable period of time, but not later than ninety (90) days after receiving the claim, unless the Committee determines that special circumstances require an extension.  In such case, a written extension notice shall be furnished before the end of the initial 90-day period.  The extension cannot exceed ninety (90) days.  The extension notice shall indicate the special circumstances requiring an extension of time and the date by which the Committee expects to render the decision.  The claim determination time frames begin when a claim is filed, without regard to whether all the information necessary to make a claim determination accompanies the filing.  Any notice of denial shall include:

(a)The specific reason or reasons for denial with reference to those specific Plan provisions on which the denial is based;

(b)A description of any additional material or information necessary to perfect the claim and an explanation of why that material or information is necessary; and

(c)A description of the Plan’s appeal procedures and time frames, including a statement of the claimant’s right to bring a civil action following an adverse decision on appeal.

Sec. 6.02Appeal Procedures.  A claimant, or a claimant’s authorized representative, may appeal a denied claim within sixty (60) days after receiving the Committee’s notice of denial.  A claimant has the right to:

(a)Submit to the Committee, for review, written comments, documents, records and other information relating to the claim;

(b)Request, free of charge, reasonable access to, and copies of, all documents, records and other information relevant to the claimant’s claim; and

(c)A review on appeal that takes into account all comments, documents, records, and other information submitted by the claimant, without regard to whether such information was submitted or considered in the initial claim decision.

The Committee will make a full and fair review of the appeal and may require additional documents as it deems necessary in making such a review.  A final decision on review shall be made within a reasonable period of time, but not later than sixty (60) days following receipt of the written request for review, unless the Committee determines that special circumstances require an extension.  In such case, a written extension notice will be sent to the claimant before the end of the initial 60-day period.  The extension notice shall indicate the special circumstances and the date by which the Committee expects to render the appeal decision.  The extension cannot exceed a period of sixty (60) days.  The appeal time frames begin when an appeal is filed, without regard to whether all the information necessary to make an appeal decision accompanies the filing.  If an extension is necessary because the claimant failed to submit necessary information, the days from the date the Committee sends the extension notice until the claimant responds to the request for additional information are not counted as part of the appeal determination period.  The Committee’s notice of denial on appeal shall include:

(a)The specific reason or reasons for denial with reference to those Plan provisions on which the denial is based;

(b)A statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of all documents, records, and other information relevant to the claimant’s claim; and

(c)A statement describing any voluntary appeal procedures offered by the Plan and the claimant’s right to obtain the information about such procedures, and a statement of the claimant’s right to bring an action under ERISA.

Sec. 6.03Limitation of Actions. The failure of a claimant to follow the claims procedure in Sections 6.01 and 6.02 will extinguish his or her right to file a subsequent claim or to file a lawsuit with respect to the claim.  If a claimant follows the claims procedure, but his or her claim is denied, he or she will have one year form the date he or she receives a final determination under Section 6.02 in which to file a lawsuit with respect to that claim, and failure to meet the one-year deadline will extinguish his or her right to file a lawsuit with respect to that claim.

ARTICLE VII

AMENDMENT AND TERMINATION

Sec. 7.01Plan Amendment.  To the extent permitted by applicable Law, this Plan may be amended, modified or terminated in any manner and in whole or in part by the Committee, in its sole discretion, at any time.  Notwithstanding the foregoing, any amendment to change the method used to determine the Employer Credit or any other amendment that would substantially increase the cost of the Plan shall require the approval of the Board of Directors of the Company.

Sec. 7.02Termination of the Plan.  The Company reserves the right to terminate the Plan, or an Employer may terminate its participation in the Plan, at any time.  Upon termination of the Plan, each affected Participant’s Account may be distributed in a manner compliant with Code Section 409A, as the Company may determine.

ARTICLE VIII

MISCELLANEOUS

Sec. 8.01Supplemental Benefits.  The benefits provided for a Participant under this Plan are in addition to benefits provided by any other plan or program of the Employer and, except as otherwise expressly provided herein, the benefits of this Plan shall supplement and shall not supersede any plan or agreement between the Employer and any Participant or any provisions contained herein.

Sec. 8.02Payments Due Incompetents.  If the Committee determines that any person entitled to a distribution under this Plan is incompetent by reason of physical or mental disability, the Committee may cause the distribution becoming due to such person to be made to another for his/her benefit without responsibility of the Committee to see to the application of such payments.  Distributions made pursuant to this Section shall completely discharge the obligations of the Employer under this Plan.

Sec. 8.03Limitation of Participant’s Rights.  Nothing in this Plan shall be construed as conferring upon any Participant any right to continue in the employment of the Employer, nor shall it interfere with the rights of the Employer to terminate the employment of any Participant and/or take any personnel action affecting any Participant without regard to the effect which such action may have upon such Participant as a recipient or prospective recipient of benefits under this Plan.

Sec. 8.04Obligations to Employer.  If a Participant becomes entitled to a distribution of benefits under the Plan, and if at such time the Participant has outstanding any debt, obligation, or other liability representing an amount owing to the Employer, then the Employer may offset such amount owed to it against the amount of benefits otherwise distributable to the extent permitted by Code Section 409A.

Sec. 8.05Nonalienation of Benefits. Except as expressly provided herein, no Participant or Beneficiary shall have the power or right to transfer (otherwise than by will or the laws of descent and distribution), alienate, or otherwise encumber the Participant’s interest under this Plan. Any such attempted assignment shall be considered null and void. The interest of any Participant or any Beneficiary receiving payments hereunder shall not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by creditors of the Participant or the Participant’s Beneficiary. The Employer’s obligations under this Plan are not assignable or transferable except to (a) a business entity that acquires all or substantially all of an Employer’s assets or (b) any business entity into which an Employer may be merged or consolidated.

Sec. 8.06Unfunded Status of Plan.  This Plan constitutes a mere promise by the Employer to make benefit payments in the future.  Benefits payable hereunder shall be payable out of the general assets of the Employer, and no segregation of any assets whatsoever for such benefits shall be made.  With respect to any payments not yet made to a Participant, nothing contained herein shall give any such Participant any rights that are greater than those of a general creditor of his/her Employer.

Sec. 8.07Code Section 409A.  The Plan and the benefits provided hereunder are intended to comply with Code Section 409A and the guidance and Treasury regulations issued thereunder.  Notwithstanding any provision of the Plan to the contrary, the Plan shall be interpreted and construed consistent with this intent.  Notwithstanding the foregoing, the Employer shall not be required to assume any increased economic burden in connection therewith.  Although the Company intends to administer the Plan so that it will comply with from the requirements of Code Section 409A, the Employer does not represent or warrant that the Plan will comply with, or be exempt from, Code Section 409A or any other provision of federal, state, local, or non-United States law.  Neither Employer, its subsidiaries, nor their respective directors, officers, employees or advisers shall be liable to any Participant (or any other individual claiming a benefit through the Participant) for any tax, interest, or penalties the Participant may owe as a result of participation in the Plan, and the Employer and its subsidiaries shall have no obligation to indemnify or otherwise protect any Participant from the obligation to pay any taxes imposed pursuant to Code Section 409A.

Sec. 8.08Acceleration or Delay of Payments.  The Company reserves the right, exercisable in its sole discretion, to accelerate or delay payments under this Plan to the extent permitted by Code Section 409A.

Sec. 8.09Inability to Locate Participant.  In the event that the Committee is unable to locate a Participant or beneficiary within two years following the date a Participant’s Account becomes payable pursuant to Section 4.01, all amounts credited to the Participant’s Account shall be forfeited.  If, within a five-year period following the date of such forfeiture, the Participant or beneficiary later claims such benefits, they shall be reinstated without interest.  If the Committee does not receive a claim to such benefits within the five year period following the date of forfeiture, benefits forfeited pursuant to this Section 8.09 will not be reinstated.

Sec. 8.10Severability.  If any provision of this Plan is held unenforceable, the remainder of this Plan shall continue in full force and effect without regard to such

unenforceable provision and shall be applied as though the unenforceable provision was not contained in this Plan.

Sec. 8.11Notice.  Any notice or filing required or permitted to be given to the Committee under this Plan shall be sufficient if in writing and hand delivered, or sent by registered or certified mail, to the Committee or to such representatives as the Committee may designate from time to time.  Such notice shall be deemed given as to the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification.

Sec. 8.12Governing Law.  This Plan shall be governed and construed under the laws of the State of Delaware to the extent not preempted by federal law that shall otherwise control.

Sec. 8.13Binding Terms. The provisions of this Plan shall be binding upon and inure to the benefit of the parties hereto, their respective heirs, executors, administrators and successors.

Sec. 8.14Headings.  All headings preceding the text of the several sections hereof are inserted solely for reference and shall not constitute a part of this Plan, nor affect its meaning, construction or effect.

IN WITNESS WHEREOF, and as evidence of its adoption of this Plan, the Company has caused the same to be executed the day and year first above written.

KEURIG GREEN MOUNTAIN, INC.
By:	/s/ Michael Reeves
Title:	Sr. Director of Tax

EX-21

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Exhibit 21

Subsidiaries of the Registrant
As of November 19, 2014

Subsidiary	State or Jurisdiction of Incorporation or Organization	Name Under Which Does Business (if different)
Keurig Canada, Inc.	New Brunswick, Canada

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Exhibit 21

Subsidiaries of the Registrant As of November 19, 2014

EX-23

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Exhibit 23

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 333-29641, No. 333-65321, No. 333-78937, No. 333-70116, No.333-123255, No. 333-135237, No. 333-141567, No. 333-150929, No. 333-163544, No. 333-175896, No. 333-187137, and No. 333-194360) and on Form S-3 (No. 333-160974) of Keurig Green Mountain, Inc. of our report dated November 19, 2014 relating to the financial statements, financial statement schedule, and the effectiveness of internal control over financial reporting, which appears in this Form 10-K.

/s/ PricewaterhouseCoopers LLP
Boston, Massachusetts
November 19, 2014

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Exhibit 23

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

EX-31.1

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Exhibit 31.1

CERTIFICATION PURSUANT TO
SECURITIES EXCHANGE ACT RULES 13a-14 and 15d-14
AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Brian P. Kelley, President and Chief Executive Officer, certify that:

        1.     I have reviewed this annual report on Form 10-K of Keurig Green Mountain, Inc.;

        2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

        3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

        4.     The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

        a.     Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

        b.     Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

        c.     Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

        d.     Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

        5.     The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

        a.     All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

        b.     Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 19, 2014

/s/ BRIAN P. KELLEY
Brian P. Kelley
President and Chief Executive Officer

QuickLinks

Exhibit 31.1

CERTIFICATION PURSUANT TO SECURITIES EXCHANGE ACT RULES 13a-14 and 15d-14 AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

EX-31.2

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Exhibit 31.2

CERTIFICATION PURSUANT TO
SECURITIES EXCHANGE ACT RULES 13a-14 and 15d-14
AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Frances G. Rathke, Chief Financial Officer and Treasurer, certify that:

        1.     I have reviewed this annual report on Form 10-K of Keurig Green Mountain, Inc.;

        2.     Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

        3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

        4.     The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

        a.     Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

        b.     Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

        c.     Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

        d.     Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

        5.     The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

        a.     All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

        b.     Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: November 19, 2014

/s/ FRANCES G. RATHKE
Frances G. Rathke
Chief Financial Officer and Treasurer

QuickLinks

Exhibit 31.2

CERTIFICATION PURSUANT TO SECURITIES EXCHANGE ACT RULES 13a-14 and 15d-14 AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

EX-32

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Exhibit 32

CERTIFICATIONS OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER
PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

        In connection with the Annual Report of Keurig Green Mountain, Inc. (the "Company") on Form 10-K for the period ending September 27, 2014 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), each of the undersigned officers of the Company certifies, pursuant to 18 U.S.C. 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of such officer's knowledge:

        (1)   The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

        (2)   The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 19, 2014

/s/ BRIAN P. KELLEY
Brian P. Kelley
President and Chief Executive Officer

Date: November 19, 2014

/s/ FRANCES G. RATHKE
Frances G. Rathke
Chief Financial Officer and Treasurer

QuickLinks

Exhibit 32

CERTIFICATIONS OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

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Long-Term Debt (Tables)

12 Months Ended

Sep. 27, 2014

Long-Term Debt

Outstanding long-term debt

Long-term debt outstanding consists of the following (in thousands) as of:

	September 27, 2014		September 28, 2013
Term loan A		158,438		170,937
Other		1,576		2,213
Total long-term debt	$	160,014	$	173,150
Less current portion		19,077		12,929
Long-term portion	$	140,937	$	160,221

Debt related derivative instruments

Below is a summary of the Company's derivative instruments in effect as of September 27, 2014 mitigating interest rate exposure of variable-rate borrowings (in thousands):

Derivative Instrument	Hedged Transaction	Notional Amount of Underlying Debt		Fixed Rate Received			Maturity (Fiscal Year)
Swap	30-day Libor		30,000		2.54	%		2016
Swap	30-day Libor		50,000		2.54	%		2016
Swap	30-day Libor		20,000		2.54	%		2016
Swap	30-day Libor		30,000		2.54	%		2016
		$	130,000

Maturities of long-term debt

Scheduled maturities of long-term debt are as follows (in thousands):

Fiscal Year
2015		19,077
2016		140,022
2017		348
2018		364
2019		203
	$	160,014

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Segment Reporting (Details 2) (USD $) In Thousands, unless otherwise specified	3 Months Ended												12 Months Ended
	Sep. 27, 2014	Jun. 28, 2014	Mar. 29, 2014	Dec. 28, 2013	Sep. 28, 2013	Jun. 29, 2013	Mar. 30, 2013	Dec. 29, 2012	Sep. 29, 2012	Jun. 23, 2012	Mar. 24, 2012	Dec. 24, 2011	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Segment Reporting
Net sales	$ 1,195,567	$ 1,022,371	$ 1,103,072	$ 1,386,670	$ 1,047,177	$ 967,072	$ 1,004,792	$ 1,339,059	$ 946,736	$ 869,194	$ 885,052	$ 1,158,216	$ 4,707,680	$ 4,358,100	$ 3,859,198
Fixed assets, net	1,171,425				985,563								1,171,425	985,563
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Wal Mart Stores Inc and Affiliates [Member]
Segment Reporting
Percentage of net sales													17.00%	14.00%	12.00%
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Costco Wholesale Corporation [Member]
Segment Reporting
Percentage of net sales													12.00%	11.00%
Portion Packs [Member]
Segment Reporting
Net sales													3,604,539	3,187,350	2,708,886
Brewers and Accessories [Member]
Segment Reporting
Net sales													822,271	827,570	759,805
Other Products and Royalties [Member]
Segment Reporting
Net sales													280,870	343,180	390,507
UNITED STATES
Segment Reporting
Net sales													4,074,968	3,721,182	3,248,543
Fixed assets, net	1,010,181				844,471								1,010,181	844,471
CANADA
Segment Reporting
Net sales													621,460	634,360	609,828
Fixed assets, net	125,155				135,440								125,155	135,440
Other Geographical Location [Member]
Segment Reporting
Net sales													11,252	2,558	827
Fixed assets, net	$ 36,089				$ 5,652								$ 36,089	$ 5,652

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Unaudited Quarterly Financial Data (Tables)

12 Months Ended

Sep. 27, 2014

Unaudited Quarterly Financial Data

Quarterly information

The following table presents the quarterly information for fiscal 2014 (dollars in thousands, except per share data). Each fiscal quarter comprises 13 weeks.

Fiscal 2014	December 28, 2013		March 29, 2014		June 28, 2014		September 27, 2014
Net sales	$	1,386,670	$	1,103,072	$	1,022,371	$	1,195,567
Gross profit	$	464,047	$	457,432	$	444,592	$	449,789
Net income attributable to Keurig	$	138,227	$	162,084	$	155,151	$	141,056
Earnings per share:
Basic	$	0.93	$	1.05	$	0.95	$	0.87
Diluted	$	0.91	$	1.03	$	0.94	$	0.86
Dividends paid per share	$	—	$	0.25	$	0.25	$	0.25

The following table presents the quarterly information for fiscal 2013 (dollars in thousands, except per share data). Each fiscal quarter comprises 13 weeks.

Fiscal 2013	December 29, 2012		March 30, 2013		June 29, 2013		September 28, 2013
Net sales	$	1,339,059	$	1,004,792	$	967,072	$	1,047,177
Gross profit	$	419,163	$	415,146	$	407,618	$	377,459
Net income attributable to Keurig	$	107,583	$	132,421	$	116,272	$	126,956
Earnings per share:
Basic	$	0.72	$	0.89	$	0.78	$	0.84
Diluted	$	0.70	$	0.87	$	0.76	$	0.83
Dividends paid per share	$	—	$	—	$	—	$	—

The following table presents the quarterly information for fiscal 2012 (dollars in thousands, except per share data). Each fiscal quarter comprises 13 weeks, except the fiscal quarter ended September 29, 2012 which is comprised of 14 weeks.

Fiscal 2012	December 24, 2011		March 24, 2012		June 23, 2012		September 29, 2012
Net sales	$	1,158,216	$	885,052	$	869,194	$	946,736
Gross profit	$	336,604	$	313,038	$	303,311	$	316,446
Net income attributable to Keurig	$	104,414	$	93,031	$	73,296	$	91,887
Earnings per share:
Basic	$	0.67	$	0.60	$	0.47	$	0.59
Diluted	$	0.66	$	0.58	$	0.46	$	0.58
Dividends paid per share	$	—	$	—	$	—	$	—

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Derivative Financial Instruments (Details 3) (USD $) In Thousands, unless otherwise specified	Sep. 27, 2014	Sep. 28, 2013
Derivatives
Gross amounts of recognized assets	$ 9,830	$ 13
Gross amounts offset in the Consolidated Balance Sheet	(334)
Net amount of assets presented in the Consolidated Balance Sheet	9,496	13
Gross amounts not offset in the Consolidated Balance Sheet
Net amount	$ 9,496	$ 13

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Inventories (Details) (USD $) In Thousands, unless otherwise specified	Sep. 27, 2014	Sep. 28, 2013
Inventories
Raw materials and supplies	$ 169,858	$ 182,882
Finished goods	665,309	493,207
Inventories	835,167	676,089
Green Coffee [Member]
Purchase commitments
Amount of purchase commitment	407,700
Percentage of purchase commitment that has a fixed price	88.00%
Average C price of coffee per pound used to calculate variable portion of purchase commitment (in dollars per pound)	1.93
Brewer Inventory [Member]
Purchase commitments
Amount of purchase commitment	256,400
Production Raw Materials [Member]
Purchase commitments
Amount of purchase commitment	$ 1,108,700

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Income Taxes (Details 4) (USD $)	Sep. 27, 2014	Sep. 28, 2013
Income Taxes
Valuation allowance - capital loss carryforward	$ 1,568,000	$ 1,418,000
Capital Loss Carryforward [Member]
Income Taxes
Carryforward amount	$ 17,700,000

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Commitments and Contingencies (Tables)

12 Months Ended

Sep. 27, 2014

Commitments and Contingencies

Schedule of future minimum lease payments and minimum payments to be received under non-cancellable subleases

As of September 27, 2014, future minimum lease payments under financing obligations, capital lease obligations and non-cancellable operating leases as well as minimum payments to be received under non-cancellable subleases are as follows (in thousands):

Fiscal Year	Capital Leases			Operating Leases		Subleases			Financing Obligations
2015	$	3,838		$	15,856	$	(939	)	$	8,828
2016		3,838			12,457		(783	)		9,773
2017		3,838			9,867		(633	)		9,773
2018		3,838			7,402		(585	)		9,868
2019		3,838			3,736		(562	)		9,956
Thereafter		27,820			26,736		(1,429	)		105,833
Total	$	47,010		$	76,054	$	(4,931	)	$	154,031
Less: amount representing interest		(14,886	)
Present value of future minimum lease payments	$	32,124

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Segment Reporting (Tables)

12 Months Ended

Sep. 27, 2014

Segment Reporting

Summary of selected financial data for segment disclosures

	For Fiscal 2014 (Dollars in thousands)
	Domestic		Canada		Corporate- Unallocated			Consolidated
Net sales	$	4,083,326	$	624,354	$	—		$	4,707,680
Operating income (loss)	$	1,016,577	$	102,605	$	(171,941	)	$	947,241
Depreciation and amortization	$	185,874	$	61,989	$	9,776		$	257,639
Stock compensation expense	$	14,071	$	2,729	$	13,873		$	30,673

	For Fiscal 2013 (Dollars in thousands)
	Domestic		Canada		Corporate- Unallocated			Consolidated
Net sales	$	3,725,008	$	633,092	$	—		$	4,358,100
Operating Income (loss)	$	826,092	$	87,674	$	(148,539	)	$	765,227
Depreciation and amortization	$	162,359	$	65,334	$	1,500		$	229,193
Stock compensation expense	$	9,909	$	2,519	$	13,653		$	26,081

	For Fiscal 2012 (Dollars in thousands)
	Domestic		Canada		Corporate- Unallocated			Consolidated
Net sales	$	3,233,674	$	625,524	$	—		$	3,859,198
Operating Income (loss)	$	576,949	$	76,198	$	(84,251	)	$	568,896
Depreciation and amortization	$	116,722	$	62,984	$	1,941		$	181,647
Stock compensation expense	$	7,808	$	1,890	$	8,170		$	17,868

Schedule of information concerning net sales of principal geographic areas

Information concerning net sales of principal geographic areas is as follows (in thousands):

	Fiscal 2014		Fiscal 2013		Fiscal 2012
Net Sales:
United States	$	4,074,968	$	3,721,182	$	3,248,543
Canada		621,460		634,360		609,828
Other		11,252		2,558		827
	$	4,707,680	$	4,358,100	$	3,859,198

Schedule of information concerning long-lived assets of principal geographic areas

Information concerning long-lived assets of principal geographic area is as follows (in thousands) as of:

	September 27, 2014		September 28, 2013
Fixed Assets, net:
United States	$	1,010,181	$	844,471
Canada		125,155		135,440
Other		36,089		5,652
	$	1,171,425	$	985,563

Schedule of net sales by major product category

Net sales by major product category (in thousands):

	Fiscal 2014		Fiscal 2013		Fiscal 2012
Portion Packs	$	3,604,539	$	3,187,350	$	2,708,886
Brewers and Accessories		822,271		827,570		759,805
Other Products and Royalties		280,870		343,180		390,507
	$	4,707,680	$	4,358,100	$	3,859,198

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Income Taxes (Details 5) (State and Local Jurisdiction [Member], USD $) In Millions, unless otherwise specified	Sep. 27, 2014
State and Local Jurisdiction [Member]
Operating Loss Carryforwards [Line Items]
Net operating loss carryforward	$ 11.5

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Derivative Financial Instruments (Details 6) (USD $)	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Gain (Loss) on Derivative Instruments [Member]
Net gain (loss) on derivative instruments
Net gains (losses) on financial instruments not designated as hedges	$ 15,312,000	$ 5,513,000	$ (4,945,000)
Commodity Contract [Member]
Net gain (loss) on derivative instruments
Amount of gain (loss), net of tax expected to be reclassified from OCI to earnings	9,400,000
Commodity Contract [Member] | Gain (Loss) on Derivative Instruments [Member]
Net gain (loss) on derivative instruments
Net gains (losses) on financial instruments not designated as hedges			7,000
Commodity Contract [Member] | Cost of Sales [Member]
Net gain (loss) on derivative instruments
Net gains (losses) on financial instruments not designated as hedges	7,005,000
Foreign Exchange Forward [Member] | Foreign Currency Gain (Loss) [Member]
Net gain (loss) on derivative instruments
Net loss on hedging derivatives		(10,000)	(48,000)
Net gain on hedged items		10,000	48,000
Cross Currency Interest Rate Contract [Member] | Gain (Loss) on Derivative Instruments [Member]
Net gain (loss) on derivative instruments
Net gains (losses) on financial instruments not designated as hedges	8,307,000	5,513,000	(4,918,000)
Interest Rate Cap [Member] | Gain (Loss) on Derivative Instruments [Member]
Net gain (loss) on derivative instruments
Net gains (losses) on financial instruments not designated as hedges			(34,000)
Cash Flow Hedging [Member]
Net gain (loss) on derivative instruments
Amount of gain (loss), gross of tax, on financial instruments qualifying for hedge accounting included in OCI	20,641,000	(3,732,000)	(1,234,000)
Amount of gain (loss), gross of tax, reclassified from OCI into Income	(6,315,000)	(1,484,000)	(1,359,000)
Cash Flow Hedging [Member] | Interest Rate Swap [Member]
Net gain (loss) on derivative instruments
Amount of gain (loss), gross of tax, on financial instruments qualifying for hedge accounting included in OCI	2,634,000	3,014,000	1,250,000
Cash Flow Hedging [Member] | Commodity Contract [Member]
Net gain (loss) on derivative instruments
Amount of gain (loss), gross of tax, on financial instruments qualifying for hedge accounting included in OCI	17,824,000	(6,617,000)	(2,484,000)
Cash Flow Hedging [Member] | Commodity Contract [Member] | Cost of Sales [Member]
Net gain (loss) on derivative instruments
Amount of gain (loss), gross of tax, reclassified from OCI into Income	(6,387,000)	(1,482,000)	(1,359,000)
Net gains (loss) recognized as ineffective portion	1,700,000	0	0
Cash Flow Hedging [Member] | Foreign Exchange Forward [Member]
Net gain (loss) on derivative instruments
Amount of gain (loss), gross of tax, on financial instruments qualifying for hedge accounting included in OCI	183,000	(129,000)
Cash Flow Hedging [Member] | Foreign Exchange Forward [Member] | Cost of Sales [Member]
Net gain (loss) on derivative instruments
Amount of gain (loss), gross of tax, reclassified from OCI into Income	74,000
Cash Flow Hedging [Member] | Foreign Exchange Forward [Member] | Foreign Currency Gain (Loss) [Member]
Net gain (loss) on derivative instruments
Amount of gain (loss), gross of tax, reclassified from OCI into Income	$ (2,000)	$ (2,000)

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Employee Compensation Plans (Details 6) (USD $)	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Compensation Plans
Total stock based compensation expense recognized in the Consolidated Statements of Operations	$ 30,673,000	$ 26,081,000	$ 17,868,000
Total related tax benefit	12,005,000	9,936,000	6,004,000
Unrecognized share-based compensation costs	55,200,000
Weighted average period for the unrecognized cost	1 year 9 months 18 days
Employee Stock [Member]
Compensation Plans
Total stock based compensation expense recognized in the Consolidated Statements of Operations	4,444,000	4,401,000	3,412,000
Employee Stock Option [Member]
Compensation Plans
Total stock based compensation expense recognized in the Consolidated Statements of Operations	13,029,000	14,151,000	12,595,000
Restricted Stock Units RSU and Restricted Stock Award RSA [Member]
Compensation Plans
Total stock based compensation expense recognized in the Consolidated Statements of Operations	$ 13,200,000	$ 7,529,000	$ 1,861,000

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Fixed Assets (Details) (USD $)	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Fixed Assets
Total fixed assets	$ 1,765,949,000	$ 1,420,778,000
Accumulated depreciation and amortization	(594,524,000)	(435,215,000)
Fixed assets, net	1,171,425,000	985,563,000
Depreciation and amortization	214,607,000	183,814,000	135,656,000
Amount of interest expense capitalized	8,000,000	6,100,000	2,800,000
Equipment [Member]
Fixed Assets
Total fixed assets	779,850,000	680,457,000
Equipment [Member] | Minimum [Member]
Fixed Assets
Useful life in years	1 year
Equipment [Member] | Maximum [Member]
Fixed Assets
Useful life in years	15 years
Coffee Service Equipment [Member]
Fixed Assets
Total fixed assets	61,029,000	59,169,000
Coffee Service Equipment [Member] | Minimum [Member]
Fixed Assets
Useful life in years	3 years
Coffee Service Equipment [Member] | Maximum [Member]
Fixed Assets
Useful life in years	7 years
Computer Equipment and Software [Member]
Fixed Assets
Total fixed assets	177,878,000	146,246,000
Computer Equipment and Software [Member] | Minimum [Member]
Fixed Assets
Useful life in years	1 year
Computer Equipment and Software [Member] | Maximum [Member]
Fixed Assets
Useful life in years	6 years
Land [Member]
Fixed Assets
Total fixed assets	12,767,000	11,520,000
Building and Building Improvements [Member]
Fixed Assets
Total fixed assets	238,945,000	134,495,000
Building and Building Improvements [Member] | Minimum [Member]
Fixed Assets
Useful life in years	4 years
Building and Building Improvements [Member] | Maximum [Member]
Fixed Assets
Useful life in years	30 years
Furniture and Fixtures [Member]
Fixed Assets
Total fixed assets	36,899,000	33,975,000
Furniture and Fixtures [Member] | Minimum [Member]
Fixed Assets
Useful life in years	1 year
Furniture and Fixtures [Member] | Maximum [Member]
Fixed Assets
Useful life in years	15 years
Vehicles [Member]
Fixed Assets
Total fixed assets	13,032,000	11,786,000
Vehicles [Member] | Minimum [Member]
Fixed Assets
Useful life in years	4 years
Vehicles [Member] | Maximum [Member]
Fixed Assets
Useful life in years	5 years
Leasehold Improvements [Member]
Fixed Assets
Total fixed assets	95,373,000	98,990,000
Leasehold Improvements [Member] | Minimum [Member]
Fixed Assets
Useful life in years	1 year
Leasehold Improvements [Member] | Maximum [Member]
Fixed Assets
Useful life in years	20 years
Assets Held under Capital Leases [Member]
Fixed Assets
Total fixed assets	41,200,000	41,200,000
Fixed assets, net	34,100,000	36,900,000
Assets Held under Capital Leases [Member] | Minimum [Member]
Fixed Assets
Useful life in years	5 years
Assets Held under Capital Leases [Member] | Maximum [Member]
Fixed Assets
Useful life in years	15 years
Construction in Progress [Member]
Fixed Assets
Total fixed assets	$ 308,976,000	$ 202,940,000

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Income Taxes (Details 2) (USD $) In Thousands, unless otherwise specified	Sep. 27, 2014	Sep. 28, 2013
Deferred tax assets:
Section 263A capitalized expenses	$ 9,011	$ 1,876
Deferred hedging gains		4,774
Deferred compensation	17,053	13,632
Capital loss carryforward	1,568	1,418
Valuation allowance - capital loss carryforward	(1,568)	(1,418)
Warranty, obsolete inventory and bad debt allowance	42,903	32,692
Tax credit carryforwards	2,085	3,651
Other reserves and temporary differences	10,053	15,558
Gross deferred tax assets	81,105	72,183
Deferred tax liabilities:
Prepaid expenses	(6,190)	(2,994)
Deferred hedging losses	(6,059)
Depreciation	(97,977)	(125,504)
Intangible assets	(115,812)	(138,262)
Other reserves and temporary differences	(174)	(237)
Gross deferred tax liabilities	(226,212)	(266,997)
Net deferred tax liabilities	$ (145,107)	$ (194,814)

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Employee Compensation Plans (Details 3) (USD $)	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Employee Stock [Member]
Compensation Plans
Average expected life	6 months	6 months	6 months
Average volatility (as a percent)	55.00%	86.00%	70.00%
Dividend yield (as a percent)	1.14%
Risk-free interest rate (as a percent)	0.06%	13.00%	9.00%
Weighted average fair value (in dollars per share)	$ 26.06	$ 14.38	$ 11.61
Employee Stock Option [Member]
Compensation Plans
Average expected life	5 years 6 months	6 years	6 years
Average volatility (as a percent)	74.00%	81.00%	69.00%
Dividend yield (as a percent)	1.30%
Risk-free interest rate (as a percent)	1.70%	1.02%	1.31%
Weighted average fair value (in dollars per share)	$ 42.38	$ 31.23	$ 30.10

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Stockholders' Equity (Details) (USD $)	0 Months Ended	3 Months Ended				12 Months Ended	2 Months Ended	0 Months Ended		0 Months Ended
	Nov. 13, 2014	Sep. 27, 2014	Jun. 28, 2014	Mar. 29, 2014	Dec. 28, 2013	Sep. 27, 2014	Apr. 17, 2014 Private Placement [Member] Common Stock Including Additional Paid in Capital [Member]	Feb. 27, 2014 Coca Cola Company [Member] Private Placement [Member] Common Stock Including Additional Paid in Capital [Member]	Feb. 27, 2014 Coca Cola Company [Member] Private Placement [Member] Common Stock Including Additional Paid in Capital [Member]	Apr. 17, 2014 Luigi Lavazza S P [Member] Private Placement [Member] Common Stock Including Additional Paid in Capital [Member]	Apr. 17, 2014 Luigi Lavazza S P [Member] Private Placement [Member] Common Stock Including Additional Paid in Capital [Member]
Stockholders' equity
Sale of common stock (in shares)								16,684,139		1,407,000
Purchase price per share for shares sold									$ 74.98		$ 74.98
Aggregate purchase price of share sold								$ 1,251,000,000		$ 105,500,000
Transaction-related expenses							8,000,000
Dividends
Dividend declared per common share (in dollars per share)	$ 0.2875	$ 0.25	$ 0.25	$ 0.25	$ 0.25	$ 1.00
Dividend declared on common shares						158,938,000
Dividend paid on common shares						$ 118,358,000
Percent increase in dividend over prior year						15.00%

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Employee Compensation Plans (Details 4) (Deferred Cash Awards [Member])	12 Months Ended
	Sep. 27, 2014
Minimum [Member]
Deferred cash awards ("DCAs")
Vesting period	3 years
Maximum [Member]
Deferred cash awards ("DCAs")
Vesting period	4 years

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Income Taxes (Details 3) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Income Taxes
U.S. Federal Statutory rate (as a percent)	35.00%	35.00%	35.00%
Tax at U.S. Federal Statutory rate	$ 323,530	$ 259,306	$ 201,692
Increase (decrease) in rates resulting from:
Foreign tax rate differential	(13,614)	(13,087)	(18,072)
Non-deductible stock compensation expense	1,562	2,700	1,024
State taxes, net of federal benefit	47,195	31,869	27,114
Provincial taxes	8,080	7,878	10,591
Domestic production activities deduction	(32,568)	(23,558)	(9,245)
Federal tax credits	(336)	(4,506)	(282)
Release of capital loss valuation allowance			(3,071)
Other	(6,890)	(3,831)	2,890
Total income tax expense	$ 326,959	$ 256,771	$ 212,641

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Derivative Financial Instruments (Details 4) (USD $) In Thousands, unless otherwise specified	Sep. 27, 2014	Sep. 28, 2013
Derivatives
Gross amounts of recognized liabilities	$ 3,705	$ 11,207
Gross amounts offset in the Consolidated Balance Sheet	(334)
Net amount of liabilities presented in the Consolidated Balance Sheet	3,371	11,207
Gross amounts not offset in the Consolidated Balance Sheet
Net amount	$ 3,371	$ 11,207

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Accrued Expenses

12 Months Ended

Sep. 27, 2014

Accrued Expenses

Accrued Expenses

18.   Accrued Expenses

Accrued expenses consisted of the following (in thousands) as of:

	September 27, 2014		September 28, 2013
Accrued compensation costs	$	101,734	$	91,418
Accrued customer incentives and promotions		74,578		53,689
Accrued freight, fulfillment and transportation costs		30,108		21,941
Accrued legal and professional services		18,635		8,278
Warranty reserve		12,850		7,804
Other		67,772		59,297
	$	305,677	$	242,427

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Significant Accounting Policies (Details) (USD $)	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Cash and Cash Equivalents
Restricted cash and cash equivalents	$ 378,000	$ 560,000
Deferred Financing Costs
Deferred financing costs	9,600,000	15,200,000
Advertising Costs
Prepaid advertising costs	3,300,000	4,100,000
Advertising expense	137,200,000	193,200,000	147,700,000
Research & Development
Research and development charges	$ 76,500,000	$ 57,700,000	$ 41,700,000

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Income Taxes (Tables)

12 Months Ended

Sep. 27, 2014

Income Taxes

Income before income taxes

Income before income taxes and the provision for income taxes for fiscal years 2014, 2013 and 2012, consist of the following (in thousands):

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Income before income taxes:
Domestic	$	856,240		$	675,438		$	486,258
Foreign		68,133			65,436			89,883
Total income before income taxes	$	924,373		$	740,874		$	576,141
Income tax expense:
United States federal:
Current	$	288,757		$	202,006		$	75,932
Deferred		(41,589	)		(8,654	)		74,042
		247,168			193,352			149,974
State and local:
Current		61,839			47,930			40,270
Deferred		(811	)		(1,695	)		(712	)
		61,028			46,235			39,558
Total United States		308,196			239,587			189,532
Foreign:
Current		36,903			29,901			26,860
Deferred		(18,140	)		(12,717	)		(3,751	)
Total foreign		18,763			17,184			23,109
Total income tax expense	$	326,959		$	256,771		$	212,641

Provision for income taxes

Income before income taxes and the provision for income taxes for fiscal years 2014, 2013 and 2012, consist of the following (in thousands):

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Income before income taxes:
Domestic	$	856,240		$	675,438		$	486,258
Foreign		68,133			65,436			89,883
Total income before income taxes	$	924,373		$	740,874		$	576,141
Income tax expense:
United States federal:
Current	$	288,757		$	202,006		$	75,932
Deferred		(41,589	)		(8,654	)		74,042
		247,168			193,352			149,974
State and local:
Current		61,839			47,930			40,270
Deferred		(811	)		(1,695	)		(712	)
		61,028			46,235			39,558
Total United States		308,196			239,587			189,532
Foreign:
Current		36,903			29,901			26,860
Deferred		(18,140	)		(12,717	)		(3,751	)
Total foreign		18,763			17,184			23,109
Total income tax expense	$	326,959		$	256,771		$	212,641

Net deferred tax liabilities

Net deferred tax liabilities consist of the following (in thousands) as of:

	September 27, 2014			September 28, 2013
Deferred tax assets:
Section 263A capitalized expenses	$	9,011		$	1,876
Deferred hedging gains		—			4,774
Deferred compensation		17,053			13,632
Capital loss carryforward		1,568			1,418
Valuation allowance—capital loss carryforward		(1,568	)		(1,418	)
Warranty, obsolete inventory and bad debt allowance		42,903			32,692
Tax credit carryforwards		2,085			3,651
Other reserves and temporary differences		10,053			15,558
Gross deferred tax assets		81,105			72,183
Deferred tax liabilities:
Prepaid expenses		(6,190	)		(2,994	)
Deferred hedging losses		(6,059	)		—
Depreciation		(97,977	)		(125,504	)
Intangible assets		(115,812	)		(138,262	)
Other reserves and temporary differences		(174	)		(237	)
Gross deferred tax liabilities		(226,212	)		(266,997	)
Net deferred tax liabilities	$	(145,107	)	$	(194,814	)

Reconciliation for continuing operations of reported income tax expense and amount computed using U.S. Federal Statutory rate

A reconciliation for continuing operations between the amount of reported income tax expense and the amount computed using the U.S. Federal Statutory rate of 35% is as follows (in thousands):

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Tax at U.S. Federal Statutory rate	$	323,530		$	259,306		$	201,692
Increase (decrease) in rates resulting from:
Foreign tax rate differential		(13,614	)		(13,087	)		(18,072	)
Non-deductible stock compensation expense		1,562			2,700			1,024
State taxes, net of federal benefit		47,195			31,869			27,114
Provincial taxes		8,080			7,878			10,591
Domestic production activities deduction		(32,568	)		(23,558	)		(9,245	)
Federal tax credits		(336	)		(4,506	)		(282	)
Release of capital loss valuation allowance		—			—			(3,071	)
Other		(6,890	)		(3,831	)		2,890
Tax at effective rates	$	326,959		$	256,771		$	212,641

Reconciliation of unrecognized tax benefits, including interest and penalties

A reconciliation of increases and decreases in unrecognized tax benefits, including interest and penalties, is as follows (in thousands):

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Gross tax contingencies—balance, beginning of year	$	23,283		$	23,956		$	24,419
Increases from positions taken during prior periods		—			438			2,864
Decreases from positions taken during prior periods		—			—			(4,093	)
Increases from positions taken during current periods		504			2,709			906
Decreases resulting from the lapse of the applicable statute of limitations		(8,948	)		(3,820	)		(140	)
Gross tax contingencies—balance, end of year	$	14,839		$	23,283		$	23,956

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Income Taxes (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Income before income taxes:
Domestic	$ 856,240	$ 675,438	$ 486,258
Foreign	68,133	65,436	89,883
Income before income taxes	924,373	740,874	576,141
United States federal:
Current	288,757	202,006	75,932
Deferred	(41,589)	(8,654)	74,042
Total United States federal	247,168	193,352	149,974
State and local:
Current	61,839	47,930	40,270
Deferred	(811)	(1,695)	(712)
Total State and local	61,028	46,235	39,558
Total United States	308,196	239,587	189,532
Foreign:
Current	36,903	29,901	26,860
Deferred	(18,140)	(12,717)	(3,751)
Total foreign	18,763	17,184	23,109
Total income tax expense	$ 326,959	$ 256,771	$ 212,641

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Related Party Transactions (Details) (Heritage Flight [Member], USD $) In Millions, unless otherwise specified	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Heritage Flight [Member]
Related party transaction
Minimum percentage of the Company's common stock held by owner of related entity	5.00%
Total amount billed for travel services	$ 0	$ 0.2	$ 0.7

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Noncontrolling Interests (Tables)

12 Months Ended

Sep. 27, 2014

Noncontrolling Interests

Schedule of changes in the liability and temporary equity attributable to redeemable NCIs

The changes in the liability and temporary equity attributable to redeemable NCIs for the three fiscal years in the period ended September 27, 2014 are as follows (in thousands):

	Liability attributable to mandatorily redeemable noncontrolling interests			Equity attributable to redeemable noncontrolling interests
Balance at September 24, 2011	$	—		$	21,034
Disposition of noncontrolling interest		—			(10,331	)
Redeemable noncontrolling interest reclassified to other long-term liabilities		4,708			(4,708	)
Net income		60			812
Adjustment to redemption value		167			3,155
Cash distributions		(204	)		(513	)
Other comprehensive loss, net of tax		197			455
Balance at September 29, 2012	$	4,928		$	9,904
Net income		462			409
Adjustment to redemption value		372			2,025
Cash distributions		(583	)		(823	)
Other comprehensive loss, net of tax		(245	)		(470	)
Balance at September 28, 2013	$	4,934		$	11,045
Net income		344			552
Adjustment to redemption value		47			2,368
Cash distributions		(348	)		(651	)
Other comprehensive loss, net of tax		(225	)		(874	)
Purchase of noncontrolling interest		(4,752	)		—
Balance at September 27, 2014	$	—		$	12,440

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Divestitures (Details) (USD $)	0 Months Ended	1 Months Ended	3 Months Ended	12 Months Ended
	Oct. 03, 2011	Oct. 31, 2011	Dec. 24, 2011	Sep. 29, 2012
Divestiture
Gain on sale of subsidiary				$ 26,311,000
Filterfresh [Member]
Divestiture
Cash received on sale of subsidiary		149,500,000
Amount of cash transferred as part of sale of subsidiary		4,400,000
Payment made for settlement of contingency		7,400,000
Net cash inflow related to sale of subsidiary		137,700,000
Gain on sale of subsidiary			26,300,000
Revenues and net income of disposal group included in consolidated statement of operations
Net sales	2,286,000
Net income	229,000
Less income attributable to noncontrolling interests	20,000
Net income attributable to Keurig	209,000
Amount of sales eliminated in consolidation				$ 600,000

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Long-Term Debt (Details 4) (USD $) In Thousands, unless otherwise specified	Sep. 27, 2014	Sep. 28, 2013
Long-Term Debt
2015	$ 19,077
2016	140,022
2017	348
2018	364
2019	203
Total long-term debt	$ 160,014	$ 173,150

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Goodwill and Intangible Assets (Details 4) (USD $) In Thousands, unless otherwise specified	Sep. 27, 2014
Estimated aggregate amortization expense over each of the next five years and thereafter
2015	$ 40,452
2016	39,727
2017	38,331
2018	38,331
2019	38,231
Thereafter	$ 80,115

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Earnings Per Share (Tables)

12 Months Ended

Sep. 27, 2014

Earnings Per Share

Reconciliation of the numerator and denominator of basic and diluted earnings per share computations

The following table illustrates the reconciliation of the numerator and denominator of basic and diluted earnings per share computations (dollars in thousands, except share and per share data):

	Fiscal 2014		Fiscal 2013		Fiscal 2012
Numerator for basic and diluted earnings per share:
Net income attributable to Keurig	$	596,518	$	483,232	$	362,628
Denominator:
Basic weighted average shares outstanding		157,085,574		149,638,636		154,933,948
Effect of dilutive securities—stock options		2,482,768		3,162,857		4,141,698
Diluted weighted average shares outstanding		159,568,342		152,801,493		159,075,646
Basic net income per common share	$	3.80	$	3.23	$	2.34
Diluted net income per common share	$	3.74	$	3.16	$	2.28

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Significant Accounting Policies

12 Months Ended

Sep. 27, 2014

Significant Accounting Policies

Significant Accounting Policies

2.     Significant Accounting Policies

Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Company to make estimates and assumptions that affect amounts reported in the accompanying Consolidated Financial Statements. Significant estimates and assumptions by management affect the Company's inventory, deferred tax assets, allowance for sales returns, warranty reserves and certain accrued expenses, goodwill, intangible and long-lived assets and stock-based compensation.

Although the Company regularly assesses these estimates, actual results could differ from these estimates. Changes in estimates are recorded in the period they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances.

Principles of Consolidation

The Consolidated Financial Statements include the accounts of the Company and all of the entities in which the Company has a controlling financial interest, most often because the Company holds a majority voting/ownership interest. All intercompany transactions and accounts are eliminated in consolidation.

Noncontrolling Interests

Noncontrolling interests ("NCI") are evaluated by the Company and are shown as either a liability, temporary equity (shown between liabilities and equity) or as permanent equity depending on the nature of the redeemable features at amounts based on formulas specific to each entity. Generally, mandatorily redeemable NCI's are classified as liabilities and non-mandatorily redeemable NCI's are classified outside of shareholders' equity in the Consolidated Balance Sheets as temporary equity under the caption, Redeemable noncontrolling interests, and are measured at their redemption values at the end of each period. If the redemption value is greater than the carrying value, an adjustment is recorded in retained earnings to record the NCI at its redemption value. Redeemable NCIs that are mandatorily redeemable are classified as a liability in the Consolidated Balance Sheets under either Other current liabilities or Other long-term liabilities, depending on the remaining duration until settlement, and are measured at the amount of cash that would be paid if settlement occurred at the balance sheet date with any change from the prior period recognized as interest expense. See Note 8, Noncontrolling Interests in the Consolidated Financial Statements included in this Annual Report for further information.

Net income attributable to NCIs reflects the portion of the net income (loss) of consolidated entities applicable to the NCI shareholders in the accompanying Consolidated Statements of Operations. The net income attributable to NCIs is classified in the Consolidated Statements of Operations as part of consolidated net income and deducted from total consolidated net income to arrive at the net income attributable to the Company.

If a change in ownership of a consolidated subsidiary results in a loss of control or deconsolidation, any retained ownership interests are remeasured with the gain or loss reported to net earnings.

Business Combinations

The Company uses the acquisition method of accounting for business combinations and recognizes assets acquired and liabilities assumed measured at their fair values on the date acquired. Goodwill represents the excess of the purchase price over the fair value of the net assets. The fair values of the assets and liabilities acquired are determined based upon the Company's valuation. The valuation involves making significant estimates and assumptions which are based on detailed financial models including the projection of future cash flows, the weighted average cost of capital and any cost savings that are expected to be derived in the future.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents include money market funds which are carried at cost, plus accrued interest, which approximates fair value. The Company does not believe that it is subject to any unusual credit or market risk.

Restricted Cash and Cash Equivalents

Restricted cash and cash equivalents represents cash that is not available for use in our operations. The Company had restricted cash and cash equivalents of $0.4 million and $0.6 million as of September 27, 2014 and September 28, 2013, respectively.

Short-Term Investments

The Company considers all investments purchased with an original maturity of more than three months but less than one year to be short-term investments. The short-term investment balance as of September 27, 2014 represents a certificate of deposit that the Company has the intent and ability to hold to maturity. It is therefore classified as held-to-maturity and carried at amortized cost. The fair value of this instrument is equal to its amortized cost and therefore there are no unrealized gains or losses associated with the instrument.

Allowance for Doubtful Accounts

A provision for doubtful accounts is provided based on a combination of historical experience, specific identification and customer credit risk where there are indications that a specific customer may be experiencing financial difficulties.

Inventories

Inventories consist primarily of green and roasted coffee, including coffee in portion packs, purchased finished goods such as coffee brewers, and packaging materials. Inventories are stated at the lower of cost or market. Cost is being measured using an adjusted standard cost method which approximates FIFO (first-in, first-out). The Company regularly reviews whether the net realizable value of its inventory is lower than its carrying value. If the valuation shows that the net realizable value is lower than the carrying value, the Company takes a charge to cost of sales and directly reduces the carrying value of the inventory.

The Company estimates any required write downs for inventory obsolescence by examining its inventories on a quarterly basis to determine if there are indicators that the carrying values exceed net realizable value. Indicators that could result in additional inventory write downs include age of inventory, damaged inventory, slow moving products and products at the end of their life cycles. While management believes that inventory is appropriately stated at the lower of cost or market, significant judgment is involved in determining the net realizable value of inventory.

Financial Instruments

The Company enters into various types of financial instruments in the normal course of business. Fair values are estimated based on assumptions concerning the amount and timing of estimated future cash flows and assumed discount rates reflecting varying degrees of perceived risk. Cash, cash equivalents, short-term investments, accounts receivable, accounts payable and accrued expenses are reported at carrying value and approximate fair value due to the short maturity of these instruments. Long-term debt is also reported at carrying value, which approximates fair value due to the fact that the interest rate on the debt is based on variable interest rates.

The fair values of derivative financial instruments have been determined using market information and valuation methodologies. Changes in assumptions or estimates could affect the determination of fair value; however, management does not believe any such changes would have a material impact on the Company's financial condition, results of operations or cash flows. The fair values of short-term investments and derivative financial instruments are disclosed in Note 12, Fair Value Measurements, in the Consolidated Financial Statements included in this Annual Report.

Derivative Instruments

The Company enters into over-the-counter derivative contracts based on coffee futures ("coffee futures") to hedge against price increases in price-to-be-coffee purchase commitments and anticipated coffee purchases. Coffee purchases are generally denominated in the U.S. dollar. The Company also enters into interest rate swap agreements to mitigate interest rate risk associated with the Company's variable-rate borrowings and foreign currency forward contracts to hedge the purchase and payment of certain green coffee purchase commitments as well as certain recognized liabilities in currencies other than the Company's functional currency. All derivatives are recorded at fair value. Interest rate swaps, coffee futures, and certain foreign currency forward contracts which hedge the purchase and payment of green coffee purchase commitments are designated as cash flow hedges with the effective portion of the change in the fair value of the derivative instrument recorded as a component of other comprehensive income ("OCI") and subsequently reclassified into net earnings when the hedged exposure affects net earnings. Foreign currency forward contracts which hedge certain recognized liabilities denominated in non-functional currencies are designated as fair value hedges with the changes in the fair value of these instruments along with the changes in the fair value of the hedged liabilities recognized in gain or loss on foreign currency, net in the Consolidated Statements of Operations.

Effectiveness is determined by how closely the changes in the fair value of the derivative instrument offset the changes in the fair value of the hedged item. The ineffective portion of the change in the fair value of the derivative instrument is recorded directly to earnings.

The Company formally documents hedging instruments and hedged items, and measures at each balance sheet date the effectiveness of its hedges. When it is determined that a derivative is not highly effective, the derivative expires, or is sold or terminated, or the derivative is discontinued because it is unlikely that a forecasted transaction will occur, the Company discontinues hedge accounting prospectively for that specific hedge instrument.

The Company also occasionally enters into certain foreign currency forward contracts to hedge certain exposures that are not designated as hedging instruments for accounting purposes. These contracts are recorded at fair value, with the changes in fair value recognized in the Consolidated Statements of Operations.

The Company does not engage in speculative transactions, nor does it hold derivative instruments for trading purposes. See Note 11, Derivative Financial Instruments and Note 14, Stockholders' Equity in the Consolidated Financial Statements included in this Annual Report for further information.

Deferred Financing Costs

Deferred financing costs consist primarily of commitment fees and loan origination fees and are being amortized over the respective life of the applicable debt using a method that approximates the effective interest rate method. Deferred financing costs included in Other long-term assets in the accompanying Consolidated Balance Sheets as of September 27, 2014 and September 28, 2013 were $9.6 million and $15.2 million, respectively.

Goodwill and Intangibles

Goodwill is tested for impairment annually at the end of the Company's fiscal year or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Goodwill is assigned to reporting units for purposes of impairment testing. A reporting unit is the same as an operating segment or one level below an operating segment. The Company may assess qualitative factors to determine if it is more likely than not (i.e., a likelihood of more than 50%) that the fair value of a reporting unit is less than its carrying amount, including goodwill. If the Company determines that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, no further testing is necessary. If, however, the Company determines that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the Company performs the first step of a two-step goodwill impairment test. The assessment of qualitative factors is optional and at the Company's discretion. The Company may bypass the qualitative assessment for any reporting unit in any period and perform the first step of the quantitative goodwill impairment test. The Company may resume performing the qualitative assessment in any subsequent period. The first step is a comparison of each reporting unit's fair value to its carrying value. The Company estimates fair value based on discounted cash flows. The reporting unit's discounted cash flows require significant management judgment with respect to sales forecasts, gross margin percentages, selling, operating, general and administrative ("SG&A") expenses, capital expenditures and the selection and use of an appropriate discount rate. The projected sales, gross margin and SG&A expense rate assumptions and capital expenditures are based on the Company's annual business plan or other forecasted results. Discount rates reflect market-based estimates of the risks associated with the projected cash flows directly resulting from the use of those assets in operations. The estimates of fair value of reporting units are based on the best information available as of the date of the assessment. If the carrying value of a reporting unit exceeds its estimated fair value in the first step, a second step is performed, which requires the Company to allocate the fair value of the reporting unit derived in the first step to the fair value of the reporting unit's net assets, with any fair value in excess of amounts allocated to such net assets representing the implied fair value of goodwill for that reporting unit. If the implied fair value of the goodwill is less than the book value, goodwill is impaired and is written down to the implied fair value amount.

Intangible assets that have finite lives are amortized over their estimated economic useful lives on a straight line basis. Intangible assets that have indefinite lives are not amortized and are tested for impairment annually or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Similar to the qualitative assessment for goodwill, the Company may assess qualitative factors to determine if it is more likely than not (i.e., a likelihood of more than 50%) that the fair value of the indefinite-lived intangible asset is less than its carrying amount. If the Company determines that it is not more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount, no further testing is necessary. If, however, the Company determines that it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount, the Company compares the fair value of the indefinite-lived asset with its carrying amount. If the carrying value of an individual indefinite-lived intangible asset exceeds its fair value, the individual indefinite-lived intangible asset is written down by an amount equal to such excess. The assessment of qualitative factors is optional and at the Company's discretion. The Company may bypass the qualitative assessment for any indefinite-lived intangible asset in any period and resume performing the qualitative assessment in any subsequent period.

Impairment of Long-Lived Assets

When facts and circumstances indicate that the carrying values of long-lived assets, including fixed assets, may be impaired, an evaluation of recoverability is performed by comparing the carrying value of the assets, at an asset group level, to undiscounted projected future cash flows in addition to other quantitative and qualitative analyses. When assessing impairment, property, plant and equipment assets are grouped at the lowest level for which there are identifiable cash flows that are largely independent of other groups of assets. Upon indication that the carrying value of such assets may not be recoverable, the Company recognizes an impairment loss as a charge against current operations based upon an assessment of fair value of such assets. Long-lived assets to be disposed of are reported at the lower of the carrying amount or fair value, less estimated costs to sell. The Company makes judgments related to the expected useful lives of long-lived assets and its ability to realize undiscounted cash flows in excess of the carrying amounts of such assets which are affected by factors such as the ongoing maintenance and improvements of the assets, changes in economic conditions and changes in operating performance.

Fixed Assets

Fixed assets are carried at cost, net of accumulated depreciation. Expenditures for maintenance, repairs and renewals of minor items are expensed as incurred. Expenditures for refurbishments and improvements that significantly improve the productive capacity or extend the useful life of an asset are capitalized. Depreciation is calculated using the straight-line method over the assets' estimated useful lives. The cost and accumulated depreciation for fixed assets sold, retired, or otherwise disposed of are relieved from the accounts, and the resultant gains and losses are reflected in income.

The Company follows an industry-wide practice of purchasing and loaning coffee brewing and related equipment to wholesale customers. These assets are also carried at cost, net of accumulated depreciation.

Depreciation costs of manufacturing and distribution assets are included in cost of sales on the Consolidated Statements of Operations. Depreciation costs of other assets, including equipment on loan to customers, are included in selling and operating expenses on the Consolidated Statements of Operations.

Leases

Occasionally, the Company is involved in the construction of leased properties. Due to the extent and nature of that involvement, the Company is deemed the owner during the construction period and is required to capitalize the construction costs on the Consolidated Balance Sheets along with a corresponding financing obligation for the project costs that are incurred by the lessor. Upon completion of the project, a sale-leaseback analysis is performed to determine if the Company can record a sale to remove the assets and related obligation and record the lease as either an operating or capital lease obligation. If the Company is precluded from derecognizing the assets when construction is complete due to continuing involvement beyond a normal leaseback, the lease is accounted for as a financing transaction and the recorded asset and related financing obligation remain on the Consolidated Balance Sheet. Accordingly, the asset is depreciated over its estimated useful life in accordance with the Company's policy. If the Company is not considered the owner of the land, a portion of the lease payments is allocated to ground rent and treated as an operating lease. The portion of the lease payment allocated to ground rental expense is based on the fair value of the land at the commencement of construction. Lease payments allocated to the buildings are

recognized as reductions to the financing obligation and interest expense. See Note 19, Commitments and Contingencies, for further information.

Leases that qualify as capital leases are recorded at the lower of the fair value of the asset or the present value of the future minimum lease payments over the lease term generally using the Company's incremental borrowing rate. Assets leased under capital leases are included in fixed assets and generally are depreciated over the lease term. Lease payments under capital leases are recognized as a reduction of the capital lease obligation and interest expense.

All other leases are considered operating leases. Assets subject to an operating lease are not recorded on the balance sheet. Lease payments are recognized on a straight-line basis as rent expense over the expected lease term.

Revenue Recognition

Revenue from sales of brewer systems, coffee and other specialty beverages in portion packs, and coffee in more traditional packaging including whole bean and ground coffee selections in bags and ground coffee in fractional packs is recognized when title and risk of loss passes to the customer, which generally occurs upon shipment or delivery of the product to the customer as defined by the contractual shipping terms. Shipping charges billed to customers are also recognized as revenue, and the related shipping costs are included in cost of sales. Cash received in advance of product delivery is recorded in deferred revenue, which is included in other current liabilities on the accompanying Consolidated Balance Sheets, until earned.

The majority of the Company's distribution to major retailers is processed by fulfillment entities. The fulfillment entities receive and fulfill sales orders and invoice certain retailers. All product shipped by the Company to the fulfillment entities are owned by the Company and included in inventories on the accompanying consolidated balance sheets. The Company recognizes revenue when delivery of the product from the fulfillment entity to the retailer has occurred based on the contractual shipping terms and when all other revenue recognition criteria are met.

Sales of brewers, portion packs and other products are recognized net of any discounts, returns, allowances and sales incentives, including coupon redemptions and rebates. The Company estimates the allowance for returns using an average return rate based on historical experience and an evaluation of contractual rights or obligations. The Company routinely participates in trade promotion programs with customers, including customers whose sales are processed by the fulfillment entities, whereby customers can receive certain incentives and allowances which are recorded as a reduction to sales when the sales incentive is offered and committed to or, if the incentive relates to specific sales, at the later of when that revenue is recognized or the date at which the sales incentive is offered. These incentives include, but are not limited to, cash discounts and volume based incentive programs. Allowances to customers that are directly attributable and supportable by customer promotional activities are recorded as selling expenses at the time the promotional activity occurs.

Roasters licensed by the Company to manufacture and sell portion packs, both to the Company for resale and to their other coffee customers, are obligated to pay a royalty to the Company upon shipment to their customer. The Company records royalty revenue upon shipment of portion packs by licensed roasters to third-party customers as set forth under the terms and conditions of various licensing agreements. For shipments of portion packs to the Company for resale, this royalty payment is recorded as a reduction to the carrying value of the related portion packs in inventory and as a reduction to cost of sales when sold through to third-party customers by the Company.

Cost of Sales

Cost of sales for the Company consists of the cost of raw materials including coffee beans, hot cocoa, flavorings and packaging materials; a portion of our rental expense; production, warehousing and distribution costs which include salaries; distribution and merchandising personnel; leases and depreciation on facilities and equipment used in production; the cost of brewers manufactured by suppliers; third-party fulfillment charges; receiving, inspection and internal transfer costs; warranty expense; freight, duties and delivery expenses; and certain third-party royalty charges. All shipping and handling expenses are also included as a component of cost of sales.

Product Warranty

The Company provides for the estimated cost of product warranties in cost of sales, at the time product revenue is recognized. Warranty costs are estimated primarily using historical warranty information in conjunction with current engineering assessments applied to the Company's expected repair or replacement costs. The estimate for warranties requires assumptions relating to expected warranty claims which can be impacted significantly by quality issues.

Advertising Costs

The Company expenses the costs of advertising the first time the advertising takes place, except for direct mail campaigns targeted directly at consumers, which are expensed over the period during which they are expected to generate sales. As of September 27, 2014 and September 28, 2013, prepaid advertising costs of $3.3 million and $4.1 million, respectively, were recorded in Other current assets in the accompanying Consolidated Balance Sheets. Advertising expense totaled $137.2 million, $193.2 million, and $147.7 million, for fiscal years 2014, 2013, and 2012, respectively.

Income Taxes

The Company recognizes deferred tax assets and liabilities for the expected future tax benefits or consequences of temporary differences between the financial statement carrying amounts of existing assets and liabilities, and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Judgment is required in determining the provision for income taxes and related accruals, deferred tax assets and liabilities. These include establishing a valuation allowance related to the ability to realize certain deferred tax assets. The Company currently believes that future earnings and current tax planning strategies will be sufficient to recover substantially all of the Company's recorded net deferred tax assets. To the extent future taxable income against which these assets may be applied is not sufficient, some portion or all of our recorded deferred tax assets would not be realizable.

Accounting for uncertain tax positions also requires significant judgments, including estimating the amount, timing and likelihood of ultimate settlement. Although the Company believes that its estimates are reasonable, actual results could differ from these estimates. The Company uses a more-likely-than-not measurement attribute for all tax positions taken or expected to be taken on a tax return in order for those tax positions to be recognized in the financial statements.

Stock-Based Compensation

The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. Equity awards consist of stock options, restricted stock units ("RSUs"), restricted stock awards ("RSAs"), and performance stock units ("PSUs"). The cost is recognized over the period during which an employee is required to provide service in exchange for the award.

The Company measures the fair value of stock options using the Black-Scholes model and certain assumptions, including the expected life of the stock options, an expected forfeiture rate and the expected volatility of its common stock. The expected life of options is estimated based on options vesting periods, contractual lives and an analysis of the Company's historical experience. The expected forfeiture rate is based on the Company's historical employee turnover experience and future expectations. The risk-free interest rate is based on the U.S. Treasury rate over the expected life. The Company uses a blended historical volatility to estimate expected volatility at the measurement date. The fair value of RSUs, RSAs and PSUs is based on the closing price of the Company's common stock on the grant date.

Foreign Currency Translation and Transactions

The financial statements of the Company's foreign subsidiaries are translated into the reporting currency of the Company which is the U.S. dollar. The functional currency of certain of the Company's foreign subsidiaries is the local currency of the subsidiary. Accordingly, the assets and liabilities of the Company's foreign subsidiaries are translated into U.S. dollars using the exchange rate in effect at each balance sheet date. Revenue and expense accounts are generally translated using the average rate of exchange during the period. Foreign currency translation adjustments are accumulated as a component of other comprehensive income or loss as a separate component of stockholders' equity. Gains and losses arising from transactions denominated in currencies other than the functional currency of the entity are charged directly against earnings in the Consolidated Statement of Operations. Gains and losses arising from transactions denominated in foreign currencies are primarily related to inter-company loans that have been determined to be temporary in nature, cash, long-term debt and accounts payable denominated in non-functional currencies.

Significant Customer Credit Risk and Supply Risk

The majority of the Company's customers are located in the U.S. and Canada. With the exception of M.Block & Sons ("MBlock") as described below, concentration of credit risk with respect to accounts receivable is limited due to the large number of customers in various channels comprising the Company's customer base. The Company does not require collateral from customers as ongoing credit evaluations of customers' payment histories are performed. The Company maintains reserves for potential credit losses and such losses, in the aggregate, have not exceeded management's expectations.

The Company procures the majority of the brewers it sells from one third-party brewer manufacturer. Purchases from this brewer manufacturer amounted to approximately $735.2 million, $637.0 million and $721.3 million in fiscal years 2014, 2013 and 2012, respectively.

The Company primarily relies on MBlock to process the majority of sales orders for our AH business with retailers in the United States. The Company is subject to significant credit risk regarding the creditworthiness of MBlock and, in turn, the creditworthiness of the retailers. Sales processed by MBlock to retailers amounted to $1,706.1 million, $1,600.2 million and $1,458.4 million for fiscal years 2014, 2013 and 2012, respectively. The Company's account receivables due from MBlock amounted to $148.2 million and $157.4 million at September 27, 2014 and September 28, 2013, respectively.

Sales to customers that represented more than 10% of the Company's net sales included Wal-Mart Stores, Inc. and affiliates ("Wal-Mart"), representing approximately 17%, 14% and 12% of consolidated net sales for fiscal years 2014, 2013 and 2012 respectively; and Costco Wholesale Corporation and affiliates ("Costco"), representing approximately 12% and 11% of consolidated net sales for fiscal 2014 and 2013, respectively. For Wal-Mart, the majority of U.S. sales are processed through MBlock whereby MBlock is the vendor of record. Starting in fiscal 2012, for U.S. sales to Costco, the Company became the vendor of record and although the sales are processed through MBlock, the Company records the account receivables from the customer and pays MBlock for their fulfillment services. The Company's account receivables due from Costco amounted to $104.5 million and $65.7 million, net of allowances, at September 27, 2014 and September 28, 2013, respectively.

Research & Development

Research and development charges are expensed as incurred. These expenses amounted to $76.5 million, $57.7 million and $41.7 million in fiscal years 2014, 2013 and 2012, respectively. These costs primarily consist of salary and consulting expenses and are recorded in selling and operating expenses in each respective segment of the Company.

Recent Accounting Pronouncements

In August 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-15 "Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern," which requires management to assess whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern within one year after the financial statements are issued. If substantial doubt exists, additional disclosures are required. ASU 2014-15 will be effective for the Company in the fourth quarter of 2017. The adoption of ASU 2014-15 is not expected to have a material impact on the Company's disclosures.

In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers (Topic 606)" ("ASU 2014-09"). ASU 2014-09 supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition, and most industry-specific guidance. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard will require the Company to separate performance obligations within a contract, determine total transaction costs, and ultimately allocate the transaction costs across the established performance obligations. This ASU will become effective for the Company beginning in fiscal 2018 under either full or modified retrospective adoption, with early adoption not permitted. The Company is currently assessing the potential effects of these changes on the Company's net income, financial position, cash flows and disclosures.

In April 2014, FASB issued ASU No. 2014-08, "Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity," which raises the threshold for disposals to qualify as discontinued operations ("ASU 2014-08"). A discontinued operation is defined as: (1) a component of an entity or group of components that has been disposed of or classified as held for sale and represents a strategic shift that has or will have a major effect on an entity's operations and financial results; or (2) an acquired business that is classified as held for sale on the acquisition date. ASU 2014-08 also requires additional disclosures regarding discontinued operations, as well as material disposals that do not meet the definition of discontinued operations. It is effective for annual periods beginning on or after December 15, 2014. Early adoption is permitted but only for disposals that have not been reported in financial statements previously issued. The adoption of ASU 2014-08 is not expected to have a material impact on the Company's net income, financial position, cash flows or disclosures.

In July 2013, the FASB issued ASU No. 2013-11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists" ("ASU 2013-11"). ASU 2013-11 was issued to eliminate diversity in practice regarding the presentation of unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. Under ASU 2013-11, an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. Otherwise, to the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The amendments in this ASU are effective prospectively for reporting periods beginning after December 15, 2013, and early adoption is permitted. The adoption of ASU 2013-11 in the first quarter of fiscal 2015 is not expected have an impact on the Company's net income, financial position or cash flows.

In March 2013, the FASB issued ASU No. 2013-05, "Foreign Currency Matters (Topic 830): Parent's Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity" ("ASU 2013-05"). ASU 2013-05 provides clarification regarding whether Subtopic 810-10, Consolidation—Overall, or Subtopic 830-30, Foreign Currency Matters—Translation of Financial Statements, applies to the release of cumulative translation adjustments into net income when a reporting entity either sells a part or all of its investment in a foreign entity or ceases to have a controlling financial interest in a subsidiary or group of assets that constitute a business within a foreign entity. The amendments in this ASU are effective prospectively for reporting periods beginning after December 15, 2013, and early adoption is permitted. The adoption of ASU 2013-05 in the first quarter of fiscal 2015 is not expected to have an impact on the Company's net income, financial position or cash flows.

In February 2013, the FASB issued ASU No. 2013-04, "Liabilities (Topic 405): Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date" ("ASU 2013-04"). ASU 2013-04 provides guidance for the recognition, measurement and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this ASU is fixed at the reporting date. The guidance requires an entity to measure those obligations as the sum of the amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors as well as any additional amount the reporting entity expects to pay on behalf of its co-obligors. ASU 2013-04 also requires an entity to disclose the nature and amount of those obligations. The amendments in this ASU are effective for reporting periods beginning after December 15, 2013, with early adoption permitted. Retrospective application is required. The adoption of ASU 2013-04 in the first quarter of fiscal 2015 is not expected have an impact on the Company's net income, financial position, cash flows or disclosures.

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Noncontrolling Interests (Details) (USD $)	12 Months Ended									0 Months Ended	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012	Sep. 27, 2014 Other Current Liabilities [Member]	Sep. 28, 2013 Other Current Liabilities [Member]	Sep. 29, 2012 Other Current Liabilities [Member]	Sep. 27, 2014 Redeemable Noncontrolling Interest [Member]	Sep. 28, 2013 Redeemable Noncontrolling Interest [Member]	Sep. 29, 2012 Redeemable Noncontrolling Interest [Member]	Aug. 22, 2014 Consolidated Entity with Noncontrolling Interest Purchased by Parent [Member]	Sep. 27, 2014 Consolidated Entity with Noncontrolling Interest Purchased by Parent [Member]
Noncontrolling Interests
Period from end of third quarter for required purchase of noncontrolling interest											30 days
Purchase of mandatorily redeemable noncontrolling interest holder's shares										$ 5,600,000
Contingent consideration in escrow for purchase of noncontrolling interest holder's shares	800,000
Changes in the liability and temporary equity attributable to redeemable NCIs
Balance at the beginning of the period				4,934,000	4,928,000		11,045,000	9,904,000	21,034,000
Disposition of noncontrolling interest				(4,752,000)					(10,331,000)
Redeemable noncontrolling interest reclassified to other long-term liabilities						4,708,000			(4,708,000)
Net income	896,000	871,000	872,000	344,000	462,000	60,000	552,000	409,000	812,000
Adjustment to redemption value				47,000	372,000	167,000	2,368,000	2,025,000	3,155,000
Cash distributions				(348,000)	(583,000)	(204,000)	(651,000)	(823,000)	(513,000)
Other comprehensive loss, net of tax				(225,000)	(245,000)	197,000	(874,000)	(470,000)	455,000
Purchase of noncontrolling interest				4,752,000					10,331,000
Balance at the end of the period					$ 4,934,000	$ 4,928,000	$ 12,440,000	$ 11,045,000	$ 9,904,000

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Stockholders' Equity (Tables)

12 Months Ended

Sep. 27, 2014

Stockholders' Equity

Schedule of stock repurchase program

	Fiscal 2014(1)		Fiscal 2013
Number of shares acquired		8,138,592		5,642,793
Average price per share of acquired shares	$	103.51	$	33.37
Total cost of acquired shares (in thousands)	$	1,052,430	$	188,278

(1) Number of shares acquired and average price per share reflect Initial Shares at then current market price, subject to change pending final settlement, and total cost of acquired shares includes total purchase price of $700.0 million under the ASR.

Changes in components of accumulated other comprehensive income (loss), net of tax

The following table provides the changes in the components of accumulated other comprehensive income (loss), net of tax (in thousands):

	Cash Flow Hedges			Translation			Accumulated Other Comprehensive Income (Loss)
Balance at September 24, 2011		(5,866	)		(8,709	)		(14,575	)
Other comprehensive income during the period		74			24,701			24,775
Balance at September 29, 2012		(5,792	)		15,992			10,200
Other comprehensive loss during the period		(1,358	)		(28,027	)		(29,385	)
Balance at September 28, 2013		(7,150	)		(12,035	)		(19,185	)
Other comprehensive income during the period		16,093			(50,968	)		(34,875	)
Foreign currency exchange impact on cash flow hedges		9			—			9
Balance at September 27, 2014	$	8,952		$	(63,003	)	$	(54,051	)

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Unaudited Quarterly Financial Data

12 Months Ended

Sep. 27, 2014

Unaudited Quarterly Financial Data

Unaudited Quarterly Financial Data

22.   Unaudited Quarterly Financial Data

The following table presents the quarterly information for fiscal 2014 (dollars in thousands, except per share data). Each fiscal quarter comprises 13 weeks.

Fiscal 2014	December 28, 2013		March 29, 2014		June 28, 2014		September 27, 2014
Net sales	$	1,386,670	$	1,103,072	$	1,022,371	$	1,195,567
Gross profit	$	464,047	$	457,432	$	444,592	$	449,789
Net income attributable to Keurig	$	138,227	$	162,084	$	155,151	$	141,056
Earnings per share:
Basic	$	0.93	$	1.05	$	0.95	$	0.87
Diluted	$	0.91	$	1.03	$	0.94	$	0.86
Dividends paid per share	$	—	$	0.25	$	0.25	$	0.25

The following table presents the quarterly information for fiscal 2013 (dollars in thousands, except per share data). Each fiscal quarter comprises 13 weeks.

Fiscal 2013	December 29, 2012		March 30, 2013		June 29, 2013		September 28, 2013
Net sales	$	1,339,059	$	1,004,792	$	967,072	$	1,047,177
Gross profit	$	419,163	$	415,146	$	407,618	$	377,459
Net income attributable to Keurig	$	107,583	$	132,421	$	116,272	$	126,956
Earnings per share:
Basic	$	0.72	$	0.89	$	0.78	$	0.84
Diluted	$	0.70	$	0.87	$	0.76	$	0.83
Dividends paid per share	$	—	$	—	$	—	$	—

The following table presents the quarterly information for fiscal 2012 (dollars in thousands, except per share data). Each fiscal quarter comprises 13 weeks, except the fiscal quarter ended September 29, 2012 which is comprised of 14 weeks.

Fiscal 2012	December 24, 2011		March 24, 2012		June 23, 2012		September 29, 2012
Net sales	$	1,158,216	$	885,052	$	869,194	$	946,736
Gross profit	$	336,604	$	313,038	$	303,311	$	316,446
Net income attributable to Keurig	$	104,414	$	93,031	$	73,296	$	91,887
Earnings per share:
Basic	$	0.67	$	0.60	$	0.47	$	0.59
Diluted	$	0.66	$	0.58	$	0.46	$	0.58
Dividends paid per share	$	—	$	—	$	—	$	—

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Earnings Per Share

12 Months Ended

Sep. 27, 2014

Earnings Per Share

Earnings Per Share

21.   Earnings Per Share

The following table illustrates the reconciliation of the numerator and denominator of basic and diluted earnings per share computations (dollars in thousands, except share and per share data):

	Fiscal 2014		Fiscal 2013		Fiscal 2012
Numerator for basic and diluted earnings per share:
Net income attributable to Keurig	$	596,518	$	483,232	$	362,628
Denominator:
Basic weighted average shares outstanding		157,085,574		149,638,636		154,933,948
Effect of dilutive securities—stock options		2,482,768		3,162,857		4,141,698
Diluted weighted average shares outstanding		159,568,342		152,801,493		159,075,646
Basic net income per common share	$	3.80	$	3.23	$	2.34
Diluted net income per common share	$	3.74	$	3.16	$	2.28

For the fiscal years 2014, 2013, and 2012, 277,000, 822,000, and 763,000 equity-based awards for shares of common stock, respectively, have been excluded in the calculation of diluted earnings per share because they were antidilutive.

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Unaudited Quarterly Financial Data (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended												12 Months Ended
	Sep. 27, 2014	Jun. 28, 2014	Mar. 29, 2014	Dec. 28, 2013	Sep. 28, 2013	Jun. 29, 2013	Mar. 30, 2013	Dec. 29, 2012	Sep. 29, 2012	Jun. 23, 2012	Mar. 24, 2012	Dec. 24, 2011	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Unaudited Quarterly Financial Data
Length of fiscal period	91 days	91 days	91 days	91 days	91 days	91 days	91 days	91 days	98 days	91 days	91 days	91 days	364 days	364 days	371 days
Net sales	$ 1,195,567	$ 1,022,371	$ 1,103,072	$ 1,386,670	$ 1,047,177	$ 967,072	$ 1,004,792	$ 1,339,059	$ 946,736	$ 869,194	$ 885,052	$ 1,158,216	$ 4,707,680	$ 4,358,100	$ 3,859,198
Gross profit	449,789	444,592	457,432	464,047	377,459	407,618	415,146	419,163	316,446	303,311	313,038	336,604	1,815,860	1,619,386	1,269,399
Net income attributable to GMCR	$ 141,056	$ 155,151	$ 162,084	$ 138,227	$ 126,956	$ 116,272	$ 132,421	$ 107,583	$ 91,887	$ 73,296	$ 93,031	$ 104,414	$ 596,518	$ 483,232	$ 362,628
Basic (in dollars per share)	$ 0.87	$ 0.95	$ 1.05	$ 0.93	$ 0.84	$ 0.78	$ 0.89	$ 0.72	$ 0.59	$ 0.47	$ 0.60	$ 0.67	$ 3.80	$ 3.23	$ 2.34
Diluted (in dollars per share)	$ 0.86	$ 0.94	$ 1.03	$ 0.91	$ 0.83	$ 0.76	$ 0.87	$ 0.70	$ 0.58	$ 0.46	$ 0.58	$ 0.66	$ 3.74	$ 3.16	$ 2.28
Dividend paid per share (in dollars per share)	$ 0.25	$ 0.25	$ 0.25

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Inventories (Details 2) (Inventories [Member], USD $) In Thousands, unless otherwise specified	Sep. 27, 2014
Inventories [Member]
Purchase commitments
2015	$ 830,788
2016	252,623
2017	250,779
2018	263,039
2019	65,762
Thereafter	109,805
Minimum future inventory purchase commitments	$ 1,772,796

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Employee Compensation Plans (Tables)

12 Months Ended

Sep. 27, 2014

Compensation Plans

Summary of option activity

	Number of Shares			Weighted Average Exercise Price (per share)
Outstanding at September 28, 2013		5,022,340		$	18.30
Granted		386,309		$	73.53
Exercised		(1,872,448	)	$	15.02
Forfeited/expired		(99,474	)	$	54.56
Outstanding at September 27, 2014		3,436,727		$	25.24
Exercisable at September 27, 2014		2,541,149		$	13.68

Summary of stock options vested and expected to vest

Number of options outstanding	Weighted average remaining contractual life (in years)		Weighted average exercise price		Intrinsic value at September 27, 2014 (in thousands)
3,428,994		4.66	$	25.15	$	361,691

Summary of stock options exercisable

Number of options exercisable	Weighted average remaining contractual life (in years)		Weighted average exercise price		Intrinsic value at September 27, 2014 (in thousands)
2,541,149		3.40	$	13.68	$	297,200

Schedule of assumptions used in estimating the grant-date fair value of employee stock options and similar instruments

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Average expected life		5.5 years			6.0 years			6.0 years
Average volatility		74	%		81	%		69	%
Dividend yield		1.30	%		—	%		—	%
Risk-free interest rate		1.70	%		1.02	%		1.31	%
Weighted average fair value	$	42.38		$	31.23		$	30.10

Summary of the number and weighted average grant-date fair value of nonvested RSUs

The following table summarizes the number and weighted average grant-date fair value of nonvested RSUs (amounts in thousands except grant date fair value and weighted average remaining contractual life):

	Share Units			Weighted Average Grant-Date Fair Value		Weighted Average Remaining Contractual Life (in Years)		Intrinsic Value (in Thousands)
Nonvested, September 28, 2013		221,502		$	42.74		1.71	$	16,586
Granted		259,507		$	119.95
Vested		(56,781	)	$	61.04
Forfeited		(15,055	)	$	82.00
Nonvested, September 27, 2014		409,173		$	86.50		3.26	$	53,450

Summary of the number and weighted average grant-date fair value of nonvested PSUs

	Share Units			Weighted Average Grant-Date Fair Value
Outstanding on September 28, 2013		120,668		$	41.10
Granted		84,232		$	107.12
Forfeited		(9,118	)	$	86.87
Outstanding on September 27, 2014(1)		195,782		$	67.38

(1) The outstanding PSUs as of September 27, 2014, at the threshold award and maximum award levels were 172,313 and 297,689, respectively.

Schedule of assumptions used in estimating the grant-date fair value of employees' purchase rights under the ESPP

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Average expected life		6 months			6 months			6 months
Average volatility		55	%		86	%		70	%
Dividend yield		1.14	%		—	%		—	%
Risk-free interest rate		0.06	%		0.13	%		0.90	%
Weighted average fair value	$	26.06		$	14.38		$	11.61

Stock-based compensation expense recognized

Stock-based compensation expense recognized in the Consolidated Statements of Operations in fiscal years 2014, 2013, and 2012 (in thousands):

	Fiscal 2014		Fiscal 2013		Fiscal 2012
Options	$	13,029	$	14,151	$	12,595
RSUs/PSUs/RSAs		13,200		7,529		1,861
ESPP		4,444		4,401		3,412
Total stock-based compensation expense recognized in the Consolidated Statements of Operations	$	30,673	$	26,081	$	17,868
Total related tax benefit	$	12,005	$	9,936	$	6,004

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Schedule II-Valuation and Qualifying Accounts

12 Months Ended

Sep. 27, 2014

Schedule II-Valuation and Qualifying Accounts

Schedule II-Valuation and Qualifying Accounts

Schedule II—Valuation and Qualifying Accounts
For the Fiscal Years Ended
September 27, 2014, September 28, 2013, and September 29, 2012
(Dollars in thousands)

Description	Balance at Beginning of Period		Acquisitions (Dispositions)			Charged to Costs and Expenses		Deductions		Balance at End of Period
Allowance for doubtful accounts:
Fiscal 2014	$	2,886	$	—		$	1,782	$	1,398	$	3,270
Fiscal 2013	$	2,750	$	—		$	689	$	553	$	2,886
Fiscal 2012	$	3,404	$	(299	)	$	3,197	$	3,552	$	2,750

Description	Balance at Beginning of Period		Acquisitions (Dispositions)		Charged to Costs and Expenses		Deductions		Balance at End of Period
Sales returns reserve:
Fiscal 2014	$	30,754	$	—	$	114,057	$	81,961	$	62,850
Fiscal 2013	$	31,767	$	—	$	79,747	$	80,760	$	30,754
Fiscal 2012	$	18,302	$	—	$	107,436	$	93,971	$	31,767

Description	Balance at Beginning of Period		Acquisitions (Dispositions)		Charged to Costs and Expenses		Deductions		Balance at End of Period
Warranty reserve(1):
Fiscal 2014	$	7,804	$	—	$	24,158	$	19,112	$	12,850
Fiscal 2013	$	20,218	$	—	$	6,948	$	19,362	$	7,804
Fiscal 2012	$	14,728	$	—	$	37,390	$	31,900	$	20,218

(1) Includes warranty recoveries from suppliers of $1.8 million, $0.8 million and $8.3 million for fiscal 2014, 2013, and 2012 respectively.

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Significant Accounting Policies (Policies)

12 Months Ended

Sep. 27, 2014

Significant Accounting Policies

Use of estimates

Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Company to make estimates and assumptions that affect amounts reported in the accompanying Consolidated Financial Statements. Significant estimates and assumptions by management affect the Company's inventory, deferred tax assets, allowance for sales returns, warranty reserves and certain accrued expenses, goodwill, intangible and long-lived assets and stock-based compensation.

Although the Company regularly assesses these estimates, actual results could differ from these estimates. Changes in estimates are recorded in the period they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances.

Principles of Consolidation

Principles of Consolidation

The Consolidated Financial Statements include the accounts of the Company and all of the entities in which the Company has a controlling financial interest, most often because the Company holds a majority voting/ownership interest. All intercompany transactions and accounts are eliminated in consolidation.

Noncontrolling Interests

Noncontrolling Interests

Noncontrolling interests ("NCI") are evaluated by the Company and are shown as either a liability, temporary equity (shown between liabilities and equity) or as permanent equity depending on the nature of the redeemable features at amounts based on formulas specific to each entity. Generally, mandatorily redeemable NCI's are classified as liabilities and non-mandatorily redeemable NCI's are classified outside of shareholders' equity in the Consolidated Balance Sheets as temporary equity under the caption, Redeemable noncontrolling interests, and are measured at their redemption values at the end of each period. If the redemption value is greater than the carrying value, an adjustment is recorded in retained earnings to record the NCI at its redemption value. Redeemable NCIs that are mandatorily redeemable are classified as a liability in the Consolidated Balance Sheets under either Other current liabilities or Other long-term liabilities, depending on the remaining duration until settlement, and are measured at the amount of cash that would be paid if settlement occurred at the balance sheet date with any change from the prior period recognized as interest expense. See Note 8, Noncontrolling Interests in the Consolidated Financial Statements included in this Annual Report for further information.

Net income attributable to NCIs reflects the portion of the net income (loss) of consolidated entities applicable to the NCI shareholders in the accompanying Consolidated Statements of Operations. The net income attributable to NCIs is classified in the Consolidated Statements of Operations as part of consolidated net income and deducted from total consolidated net income to arrive at the net income attributable to the Company.

If a change in ownership of a consolidated subsidiary results in a loss of control or deconsolidation, any retained ownership interests are remeasured with the gain or loss reported to net earnings.

Business Combinations

Business Combinations

The Company uses the acquisition method of accounting for business combinations and recognizes assets acquired and liabilities assumed measured at their fair values on the date acquired. Goodwill represents the excess of the purchase price over the fair value of the net assets. The fair values of the assets and liabilities acquired are determined based upon the Company's valuation. The valuation involves making significant estimates and assumptions which are based on detailed financial models including the projection of future cash flows, the weighted average cost of capital and any cost savings that are expected to be derived in the future.

Cash and Cash Equivalents

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents include money market funds which are carried at cost, plus accrued interest, which approximates fair value. The Company does not believe that it is subject to any unusual credit or market risk.

Restricted Cash and Cash Equivalents

Restricted Cash and Cash Equivalents

Restricted cash and cash equivalents represents cash that is not available for use in our operations. The Company had restricted cash and cash equivalents of $0.4 million and $0.6 million as of September 27, 2014 and September 28, 2013, respectively.

Short-Term Investments

Short-Term Investments

The Company considers all investments purchased with an original maturity of more than three months but less than one year to be short-term investments. The short-term investment balance as of September 27, 2014 represents a certificate of deposit that the Company has the intent and ability to hold to maturity. It is therefore classified as held-to-maturity and carried at amortized cost. The fair value of this instrument is equal to its amortized cost and therefore there are no unrealized gains or losses associated with the instrument.

Allowance for Doubtful Accounts

Allowance for Doubtful Accounts

A provision for doubtful accounts is provided based on a combination of historical experience, specific identification and customer credit risk where there are indications that a specific customer may be experiencing financial difficulties.

Inventories

Inventories

Inventories consist primarily of green and roasted coffee, including coffee in portion packs, purchased finished goods such as coffee brewers, and packaging materials. Inventories are stated at the lower of cost or market. Cost is being measured using an adjusted standard cost method which approximates FIFO (first-in, first-out). The Company regularly reviews whether the net realizable value of its inventory is lower than its carrying value. If the valuation shows that the net realizable value is lower than the carrying value, the Company takes a charge to cost of sales and directly reduces the carrying value of the inventory.

The Company estimates any required write downs for inventory obsolescence by examining its inventories on a quarterly basis to determine if there are indicators that the carrying values exceed net realizable value. Indicators that could result in additional inventory write downs include age of inventory, damaged inventory, slow moving products and products at the end of their life cycles. While management believes that inventory is appropriately stated at the lower of cost or market, significant judgment is involved in determining the net realizable value of inventory.

Financial Instruments

Financial Instruments

The Company enters into various types of financial instruments in the normal course of business. Fair values are estimated based on assumptions concerning the amount and timing of estimated future cash flows and assumed discount rates reflecting varying degrees of perceived risk. Cash, cash equivalents, short-term investments, accounts receivable, accounts payable and accrued expenses are reported at carrying value and approximate fair value due to the short maturity of these instruments. Long-term debt is also reported at carrying value, which approximates fair value due to the fact that the interest rate on the debt is based on variable interest rates.

The fair values of derivative financial instruments have been determined using market information and valuation methodologies. Changes in assumptions or estimates could affect the determination of fair value; however, management does not believe any such changes would have a material impact on the Company's financial condition, results of operations or cash flows. The fair values of short-term investments and derivative financial instruments are disclosed in Note 12, Fair Value Measurements, in the Consolidated Financial Statements included in this Annual Report.

Derivative Instruments

Derivative Instruments

The Company enters into over-the-counter derivative contracts based on coffee futures ("coffee futures") to hedge against price increases in price-to-be-coffee purchase commitments and anticipated coffee purchases. Coffee purchases are generally denominated in the U.S. dollar. The Company also enters into interest rate swap agreements to mitigate interest rate risk associated with the Company's variable-rate borrowings and foreign currency forward contracts to hedge the purchase and payment of certain green coffee purchase commitments as well as certain recognized liabilities in currencies other than the Company's functional currency. All derivatives are recorded at fair value. Interest rate swaps, coffee futures, and certain foreign currency forward contracts which hedge the purchase and payment of green coffee purchase commitments are designated as cash flow hedges with the effective portion of the change in the fair value of the derivative instrument recorded as a component of other comprehensive income ("OCI") and subsequently reclassified into net earnings when the hedged exposure affects net earnings. Foreign currency forward contracts which hedge certain recognized liabilities denominated in non-functional currencies are designated as fair value hedges with the changes in the fair value of these instruments along with the changes in the fair value of the hedged liabilities recognized in gain or loss on foreign currency, net in the Consolidated Statements of Operations.

Effectiveness is determined by how closely the changes in the fair value of the derivative instrument offset the changes in the fair value of the hedged item. The ineffective portion of the change in the fair value of the derivative instrument is recorded directly to earnings.

The Company formally documents hedging instruments and hedged items, and measures at each balance sheet date the effectiveness of its hedges. When it is determined that a derivative is not highly effective, the derivative expires, or is sold or terminated, or the derivative is discontinued because it is unlikely that a forecasted transaction will occur, the Company discontinues hedge accounting prospectively for that specific hedge instrument.

The Company also occasionally enters into certain foreign currency forward contracts to hedge certain exposures that are not designated as hedging instruments for accounting purposes. These contracts are recorded at fair value, with the changes in fair value recognized in the Consolidated Statements of Operations.

The Company does not engage in speculative transactions, nor does it hold derivative instruments for trading purposes. See Note 11, Derivative Financial Instruments and Note 14, Stockholders' Equity in the Consolidated Financial Statements included in this Annual Report for further information.

Deferred Financing Costs

Deferred Financing Costs

Deferred financing costs consist primarily of commitment fees and loan origination fees and are being amortized over the respective life of the applicable debt using a method that approximates the effective interest rate method. Deferred financing costs included in Other long-term assets in the accompanying Consolidated Balance Sheets as of September 27, 2014 and September 28, 2013 were $9.6 million and $15.2 million, respectively.

Goodwill and Intangibles

Goodwill and Intangibles

Goodwill is tested for impairment annually at the end of the Company's fiscal year or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Goodwill is assigned to reporting units for purposes of impairment testing. A reporting unit is the same as an operating segment or one level below an operating segment. The Company may assess qualitative factors to determine if it is more likely than not (i.e., a likelihood of more than 50%) that the fair value of a reporting unit is less than its carrying amount, including goodwill. If the Company determines that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, no further testing is necessary. If, however, the Company determines that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, the Company performs the first step of a two-step goodwill impairment test. The assessment of qualitative factors is optional and at the Company's discretion. The Company may bypass the qualitative assessment for any reporting unit in any period and perform the first step of the quantitative goodwill impairment test. The Company may resume performing the qualitative assessment in any subsequent period. The first step is a comparison of each reporting unit's fair value to its carrying value. The Company estimates fair value based on discounted cash flows. The reporting unit's discounted cash flows require significant management judgment with respect to sales forecasts, gross margin percentages, selling, operating, general and administrative ("SG&A") expenses, capital expenditures and the selection and use of an appropriate discount rate. The projected sales, gross margin and SG&A expense rate assumptions and capital expenditures are based on the Company's annual business plan or other forecasted results. Discount rates reflect market-based estimates of the risks associated with the projected cash flows directly resulting from the use of those assets in operations. The estimates of fair value of reporting units are based on the best information available as of the date of the assessment. If the carrying value of a reporting unit exceeds its estimated fair value in the first step, a second step is performed, which requires the Company to allocate the fair value of the reporting unit derived in the first step to the fair value of the reporting unit's net assets, with any fair value in excess of amounts allocated to such net assets representing the implied fair value of goodwill for that reporting unit. If the implied fair value of the goodwill is less than the book value, goodwill is impaired and is written down to the implied fair value amount.

Intangible assets that have finite lives are amortized over their estimated economic useful lives on a straight line basis. Intangible assets that have indefinite lives are not amortized and are tested for impairment annually or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Similar to the qualitative assessment for goodwill, the Company may assess qualitative factors to determine if it is more likely than not (i.e., a likelihood of more than 50%) that the fair value of the indefinite-lived intangible asset is less than its carrying amount. If the Company determines that it is not more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount, no further testing is necessary. If, however, the Company determines that it is more likely than not that the fair value of the indefinite-lived intangible asset is less than its carrying amount, the Company compares the fair value of the indefinite-lived asset with its carrying amount. If the carrying value of an individual indefinite-lived intangible asset exceeds its fair value, the individual indefinite-lived intangible asset is written down by an amount equal to such excess. The assessment of qualitative factors is optional and at the Company's discretion. The Company may bypass the qualitative assessment for any indefinite-lived intangible asset in any period and resume performing the qualitative assessment in any subsequent period.

Impairment of Long-Lived Assets

Impairment of Long-Lived Assets

When facts and circumstances indicate that the carrying values of long-lived assets, including fixed assets, may be impaired, an evaluation of recoverability is performed by comparing the carrying value of the assets, at an asset group level, to undiscounted projected future cash flows in addition to other quantitative and qualitative analyses. When assessing impairment, property, plant and equipment assets are grouped at the lowest level for which there are identifiable cash flows that are largely independent of other groups of assets. Upon indication that the carrying value of such assets may not be recoverable, the Company recognizes an impairment loss as a charge against current operations based upon an assessment of fair value of such assets. Long-lived assets to be disposed of are reported at the lower of the carrying amount or fair value, less estimated costs to sell. The Company makes judgments related to the expected useful lives of long-lived assets and its ability to realize undiscounted cash flows in excess of the carrying amounts of such assets which are affected by factors such as the ongoing maintenance and improvements of the assets, changes in economic conditions and changes in operating performance.

Fixed Assets

Fixed Assets

Fixed assets are carried at cost, net of accumulated depreciation. Expenditures for maintenance, repairs and renewals of minor items are expensed as incurred. Expenditures for refurbishments and improvements that significantly improve the productive capacity or extend the useful life of an asset are capitalized. Depreciation is calculated using the straight-line method over the assets' estimated useful lives. The cost and accumulated depreciation for fixed assets sold, retired, or otherwise disposed of are relieved from the accounts, and the resultant gains and losses are reflected in income.

The Company follows an industry-wide practice of purchasing and loaning coffee brewing and related equipment to wholesale customers. These assets are also carried at cost, net of accumulated depreciation.

Depreciation costs of manufacturing and distribution assets are included in cost of sales on the Consolidated Statements of Operations. Depreciation costs of other assets, including equipment on loan to customers, are included in selling and operating expenses on the Consolidated Statements of Operations.

Leases

Leases

Occasionally, the Company is involved in the construction of leased properties. Due to the extent and nature of that involvement, the Company is deemed the owner during the construction period and is required to capitalize the construction costs on the Consolidated Balance Sheets along with a corresponding financing obligation for the project costs that are incurred by the lessor. Upon completion of the project, a sale-leaseback analysis is performed to determine if the Company can record a sale to remove the assets and related obligation and record the lease as either an operating or capital lease obligation. If the Company is precluded from derecognizing the assets when construction is complete due to continuing involvement beyond a normal leaseback, the lease is accounted for as a financing transaction and the recorded asset and related financing obligation remain on the Consolidated Balance Sheet. Accordingly, the asset is depreciated over its estimated useful life in accordance with the Company's policy. If the Company is not considered the owner of the land, a portion of the lease payments is allocated to ground rent and treated as an operating lease. The portion of the lease payment allocated to ground rental expense is based on the fair value of the land at the commencement of construction. Lease payments allocated to the buildings are

recognized as reductions to the financing obligation and interest expense. See Note 19, Commitments and Contingencies, for further information.

Leases that qualify as capital leases are recorded at the lower of the fair value of the asset or the present value of the future minimum lease payments over the lease term generally using the Company's incremental borrowing rate. Assets leased under capital leases are included in fixed assets and generally are depreciated over the lease term. Lease payments under capital leases are recognized as a reduction of the capital lease obligation and interest expense.

All other leases are considered operating leases. Assets subject to an operating lease are not recorded on the balance sheet. Lease payments are recognized on a straight-line basis as rent expense over the expected lease term.

Revenue Recognition

Revenue Recognition

Revenue from sales of brewer systems, coffee and other specialty beverages in portion packs, and coffee in more traditional packaging including whole bean and ground coffee selections in bags and ground coffee in fractional packs is recognized when title and risk of loss passes to the customer, which generally occurs upon shipment or delivery of the product to the customer as defined by the contractual shipping terms. Shipping charges billed to customers are also recognized as revenue, and the related shipping costs are included in cost of sales. Cash received in advance of product delivery is recorded in deferred revenue, which is included in other current liabilities on the accompanying Consolidated Balance Sheets, until earned.

The majority of the Company's distribution to major retailers is processed by fulfillment entities. The fulfillment entities receive and fulfill sales orders and invoice certain retailers. All product shipped by the Company to the fulfillment entities are owned by the Company and included in inventories on the accompanying consolidated balance sheets. The Company recognizes revenue when delivery of the product from the fulfillment entity to the retailer has occurred based on the contractual shipping terms and when all other revenue recognition criteria are met.

Sales of brewers, portion packs and other products are recognized net of any discounts, returns, allowances and sales incentives, including coupon redemptions and rebates. The Company estimates the allowance for returns using an average return rate based on historical experience and an evaluation of contractual rights or obligations. The Company routinely participates in trade promotion programs with customers, including customers whose sales are processed by the fulfillment entities, whereby customers can receive certain incentives and allowances which are recorded as a reduction to sales when the sales incentive is offered and committed to or, if the incentive relates to specific sales, at the later of when that revenue is recognized or the date at which the sales incentive is offered. These incentives include, but are not limited to, cash discounts and volume based incentive programs. Allowances to customers that are directly attributable and supportable by customer promotional activities are recorded as selling expenses at the time the promotional activity occurs.

Roasters licensed by the Company to manufacture and sell portion packs, both to the Company for resale and to their other coffee customers, are obligated to pay a royalty to the Company upon shipment to their customer. The Company records royalty revenue upon shipment of portion packs by licensed roasters to third-party customers as set forth under the terms and conditions of various licensing agreements. For shipments of portion packs to the Company for resale, this royalty payment is recorded as a reduction to the carrying value of the related portion packs in inventory and as a reduction to cost of sales when sold through to third-party customers by the Company.

Cost of Sales

Cost of Sales

Cost of sales for the Company consists of the cost of raw materials including coffee beans, hot cocoa, flavorings and packaging materials; a portion of our rental expense; production, warehousing and distribution costs which include salaries; distribution and merchandising personnel; leases and depreciation on facilities and equipment used in production; the cost of brewers manufactured by suppliers; third-party fulfillment charges; receiving, inspection and internal transfer costs; warranty expense; freight, duties and delivery expenses; and certain third-party royalty charges. All shipping and handling expenses are also included as a component of cost of sales.

Product Warranty

Product Warranty

The Company provides for the estimated cost of product warranties in cost of sales, at the time product revenue is recognized. Warranty costs are estimated primarily using historical warranty information in conjunction with current engineering assessments applied to the Company's expected repair or replacement costs. The estimate for warranties requires assumptions relating to expected warranty claims which can be impacted significantly by quality issues.

Advertising Costs

Advertising Costs

The Company expenses the costs of advertising the first time the advertising takes place, except for direct mail campaigns targeted directly at consumers, which are expensed over the period during which they are expected to generate sales. As of September 27, 2014 and September 28, 2013, prepaid advertising costs of $3.3 million and $4.1 million, respectively, were recorded in Other current assets in the accompanying Consolidated Balance Sheets. Advertising expense totaled $137.2 million, $193.2 million, and $147.7 million, for fiscal years 2014, 2013, and 2012, respectively.

Income Taxes

Income Taxes

The Company recognizes deferred tax assets and liabilities for the expected future tax benefits or consequences of temporary differences between the financial statement carrying amounts of existing assets and liabilities, and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Judgment is required in determining the provision for income taxes and related accruals, deferred tax assets and liabilities. These include establishing a valuation allowance related to the ability to realize certain deferred tax assets. The Company currently believes that future earnings and current tax planning strategies will be sufficient to recover substantially all of the Company's recorded net deferred tax assets. To the extent future taxable income against which these assets may be applied is not sufficient, some portion or all of our recorded deferred tax assets would not be realizable.

Accounting for uncertain tax positions also requires significant judgments, including estimating the amount, timing and likelihood of ultimate settlement. Although the Company believes that its estimates are reasonable, actual results could differ from these estimates. The Company uses a more-likely-than-not measurement attribute for all tax positions taken or expected to be taken on a tax return in order for those tax positions to be recognized in the financial statements.

Stock-Based Compensation

Stock-Based Compensation

The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. Equity awards consist of stock options, restricted stock units ("RSUs"), restricted stock awards ("RSAs"), and performance stock units ("PSUs"). The cost is recognized over the period during which an employee is required to provide service in exchange for the award.

The Company measures the fair value of stock options using the Black-Scholes model and certain assumptions, including the expected life of the stock options, an expected forfeiture rate and the expected volatility of its common stock. The expected life of options is estimated based on options vesting periods, contractual lives and an analysis of the Company's historical experience. The expected forfeiture rate is based on the Company's historical employee turnover experience and future expectations. The risk-free interest rate is based on the U.S. Treasury rate over the expected life. The Company uses a blended historical volatility to estimate expected volatility at the measurement date. The fair value of RSUs, RSAs and PSUs is based on the closing price of the Company's common stock on the grant date.

Foreign Currency Translation and Transactions

Foreign Currency Translation and Transactions

The financial statements of the Company's foreign subsidiaries are translated into the reporting currency of the Company which is the U.S. dollar. The functional currency of certain of the Company's foreign subsidiaries is the local currency of the subsidiary. Accordingly, the assets and liabilities of the Company's foreign subsidiaries are translated into U.S. dollars using the exchange rate in effect at each balance sheet date. Revenue and expense accounts are generally translated using the average rate of exchange during the period. Foreign currency translation adjustments are accumulated as a component of other comprehensive income or loss as a separate component of stockholders' equity. Gains and losses arising from transactions denominated in currencies other than the functional currency of the entity are charged directly against earnings in the Consolidated Statement of Operations. Gains and losses arising from transactions denominated in foreign currencies are primarily related to inter-company loans that have been determined to be temporary in nature, cash, long-term debt and accounts payable denominated in non-functional currencies.

Significant Customer Credit Risk and Supply Risk

Significant Customer Credit Risk and Supply Risk

The majority of the Company's customers are located in the U.S. and Canada. With the exception of M.Block & Sons ("MBlock") as described below, concentration of credit risk with respect to accounts receivable is limited due to the large number of customers in various channels comprising the Company's customer base. The Company does not require collateral from customers as ongoing credit evaluations of customers' payment histories are performed. The Company maintains reserves for potential credit losses and such losses, in the aggregate, have not exceeded management's expectations.

The Company procures the majority of the brewers it sells from one third-party brewer manufacturer. Purchases from this brewer manufacturer amounted to approximately $735.2 million, $637.0 million and $721.3 million in fiscal years 2014, 2013 and 2012, respectively.

The Company primarily relies on MBlock to process the majority of sales orders for our AH business with retailers in the United States. The Company is subject to significant credit risk regarding the creditworthiness of MBlock and, in turn, the creditworthiness of the retailers. Sales processed by MBlock to retailers amounted to $1,706.1 million, $1,600.2 million and $1,458.4 million for fiscal years 2014, 2013 and 2012, respectively. The Company's account receivables due from MBlock amounted to $148.2 million and $157.4 million at September 27, 2014 and September 28, 2013, respectively.

Sales to customers that represented more than 10% of the Company's net sales included Wal-Mart Stores, Inc. and affiliates ("Wal-Mart"), representing approximately 17%, 14% and 12% of consolidated net sales for fiscal years 2014, 2013 and 2012 respectively; and Costco Wholesale Corporation and affiliates ("Costco"), representing approximately 12% and 11% of consolidated net sales for fiscal 2014 and 2013, respectively. For Wal-Mart, the majority of U.S. sales are processed through MBlock whereby MBlock is the vendor of record. Starting in fiscal 2012, for U.S. sales to Costco, the Company became the vendor of record and although the sales are processed through MBlock, the Company records the account receivables from the customer and pays MBlock for their fulfillment services. The Company's account receivables due from Costco amounted to $104.5 million and $65.7 million, net of allowances, at September 27, 2014 and September 28, 2013, respectively.

Research & Development

Research & Development

Research and development charges are expensed as incurred. These expenses amounted to $76.5 million, $57.7 million and $41.7 million in fiscal years 2014, 2013 and 2012, respectively. These costs primarily consist of salary and consulting expenses and are recorded in selling and operating expenses in each respective segment of the Company.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In August 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-15 "Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern," which requires management to assess whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern within one year after the financial statements are issued. If substantial doubt exists, additional disclosures are required. ASU 2014-15 will be effective for the Company in the fourth quarter of 2017. The adoption of ASU 2014-15 is not expected to have a material impact on the Company's disclosures.

In May 2014, the FASB issued ASU No. 2014-09, "Revenue from Contracts with Customers (Topic 606)" ("ASU 2014-09"). ASU 2014-09 supersedes the revenue recognition requirements in ASC Topic 605, Revenue Recognition, and most industry-specific guidance. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard will require the Company to separate performance obligations within a contract, determine total transaction costs, and ultimately allocate the transaction costs across the established performance obligations. This ASU will become effective for the Company beginning in fiscal 2018 under either full or modified retrospective adoption, with early adoption not permitted. The Company is currently assessing the potential effects of these changes on the Company's net income, financial position, cash flows and disclosures.

In April 2014, FASB issued ASU No. 2014-08, "Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity," which raises the threshold for disposals to qualify as discontinued operations ("ASU 2014-08"). A discontinued operation is defined as: (1) a component of an entity or group of components that has been disposed of or classified as held for sale and represents a strategic shift that has or will have a major effect on an entity's operations and financial results; or (2) an acquired business that is classified as held for sale on the acquisition date. ASU 2014-08 also requires additional disclosures regarding discontinued operations, as well as material disposals that do not meet the definition of discontinued operations. It is effective for annual periods beginning on or after December 15, 2014. Early adoption is permitted but only for disposals that have not been reported in financial statements previously issued. The adoption of ASU 2014-08 is not expected to have a material impact on the Company's net income, financial position, cash flows or disclosures.

In July 2013, the FASB issued ASU No. 2013-11, "Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists" ("ASU 2013-11"). ASU 2013-11 was issued to eliminate diversity in practice regarding the presentation of unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. Under ASU 2013-11, an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. Otherwise, to the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The amendments in this ASU are effective prospectively for reporting periods beginning after December 15, 2013, and early adoption is permitted. The adoption of ASU 2013-11 in the first quarter of fiscal 2015 is not expected have an impact on the Company's net income, financial position or cash flows.

In March 2013, the FASB issued ASU No. 2013-05, "Foreign Currency Matters (Topic 830): Parent's Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity" ("ASU 2013-05"). ASU 2013-05 provides clarification regarding whether Subtopic 810-10, Consolidation—Overall, or Subtopic 830-30, Foreign Currency Matters—Translation of Financial Statements, applies to the release of cumulative translation adjustments into net income when a reporting entity either sells a part or all of its investment in a foreign entity or ceases to have a controlling financial interest in a subsidiary or group of assets that constitute a business within a foreign entity. The amendments in this ASU are effective prospectively for reporting periods beginning after December 15, 2013, and early adoption is permitted. The adoption of ASU 2013-05 in the first quarter of fiscal 2015 is not expected to have an impact on the Company's net income, financial position or cash flows.

In February 2013, the FASB issued ASU No. 2013-04, "Liabilities (Topic 405): Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date" ("ASU 2013-04"). ASU 2013-04 provides guidance for the recognition, measurement and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this ASU is fixed at the reporting date. The guidance requires an entity to measure those obligations as the sum of the amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors as well as any additional amount the reporting entity expects to pay on behalf of its co-obligors. ASU 2013-04 also requires an entity to disclose the nature and amount of those obligations. The amendments in this ASU are effective for reporting periods beginning after December 15, 2013, with early adoption permitted. Retrospective application is required. The adoption of ASU 2013-04 in the first quarter of fiscal 2015 is not expected have an impact on the Company's net income, financial position, cash flows or disclosures.

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Nature of Business and Organization

12 Months Ended

Sep. 27, 2014

Nature of Business and Organization

Nature of Business and Organization

1.     Nature of Business and Organization

Keurig Green Mountain, Inc. (together with its subsidiaries, "the Company") is a leader in the specialty coffee and coffeemaker businesses. Keurig Green Mountain, Inc. is a Delaware corporation.

The Company manages its operations through two business segments, its United States operations within the Domestic segment and its Canadian operations within the Canada segment. The Company distributes its products in two channels: at-home ("AH") and away-from-home ("AFH").

The Domestic segment sells brewers, accessories, and sources, produces and sells coffee, hot cocoa, teas and other beverages in K-Cup®, Vue®, Rivo®, K-Carafe™ and Bolt™ packs ("portion packs") and coffee in more traditional packaging including bags and fractional packs to retailers including supermarkets, department stores, mass merchandisers, club stores, and convenience stores; to restaurants, hospitality accounts, office coffee distributors, and partner brand owners; and to consumers through Company websites. Substantially all of the Domestic segment's distribution to major retailers is processed by fulfillment entities which receive and fulfill sales orders and invoice certain retailers primarily in the AH channel. The Domestic segment also earns royalty income from portion packs sold by a third-party licensed roaster.

The Canada segment sells brewers, accessories, and sources, produces and sells coffee and teas and other beverages in portion packs and coffee in more traditional packaging including bags, cans and fractional packs under a variety of brands to retailers including supermarkets, department stores, mass merchandisers, club stores, through office coffee services to offices, convenience stores, restaurants, hospitality accounts, and to consumers through its website. The Canada segment included Filterfresh through October 3, 2011, the date of sale (see Note 3, Divestitures).

The Company's fiscal year ends on the last Saturday in September. Fiscal years 2014, 2013 and 2012 represent the years ended September 27, 2014, September 28, 2013 and September 29, 2012, respectively. Fiscal years 2014 and 2013 each consist of 52 weeks and fiscal 2012 consists of 53 weeks.

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Divestitures (Tables)

12 Months Ended

Sep. 27, 2014

Divestitures

Schedule of revenues and net income of disposal group included in the consolidated statement of operations

Filterfresh revenues and net income included in the Company's consolidated statement of operations were as follows (dollars in thousands, except per share data):

	For the period September 25, 2011 through October 3, 2011 (date of sale)
Net sales	$	2,286
Net income	$	229
Less income attributable to noncontrolling interests		20
Net income attributable to Keurig	$	209
Diluted net income per share	$	—

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Stockholders' Equity (Details 3) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Accumulated Other Comprehensive Income (Loss)
Balance at the beginning of the period	$ (19,185)	$ 10,200	$ (14,575)
Other comprehensive income (loss) during the period	(34,866)	(29,385)	24,775
Other comprehensive income during the period	(34,875)
Foreign currency exchange impact on cash flow hedges	9
Balance at the end of the period	(54,051)	(19,185)	10,200
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member]
Accumulated Other Comprehensive Income (Loss)
Balance at the beginning of the period	(7,150)	(5,792)	(5,866)
Other comprehensive income (loss) during the period		(1,358)	74
Other comprehensive income during the period	16,093
Foreign currency exchange impact on cash flow hedges	9
Balance at the end of the period	8,952	(7,150)	(5,792)
Accumulated Translation Adjustment [Member]
Accumulated Other Comprehensive Income (Loss)
Balance at the beginning of the period	(12,035)	15,992	(8,709)
Other comprehensive income (loss) during the period		(28,027)	24,701
Other comprehensive income during the period	(50,968)
Balance at the end of the period	$ (63,003)	$ (12,035)	$ 15,992

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Derivative Financial Instruments (Tables)

12 Months Ended

Sep. 27, 2014

Derivative Financial Instruments

Summary of fair value of derivatives included on Consolidated Balance Sheets

The following table summarizes the fair value of the Company's derivatives included on the Consolidated Balance Sheets (in thousands) as of:

	September 27, 2014			September 28, 2013			Balance Sheet Classification
Derivatives designated as hedges:
Interest rate swaps	$	(3,371	)	$	(6,004	)	Other current liabilities
Coffee futures		3,437			—		Other current assets
Coffee futures		—			(3,809	)	Other current liabilities
Foreign currency forward contracts		—			(141	)	Other current liabilities
Foreign currency forward contracts		108			13		Other current assets
		174			(9,941	)
Derivatives not designated as hedges:
Cross currency swap		5,951			—		Other current assets
Cross currency swap		—			(1,253	)	Other current liabilities
		5,951			(1,253	)
Total	$	6,125		$	(11,194	)

Schedule of offsetting of financial assets and derivative assets

Offsetting of financial assets and derivative assets as of September 27, 2014 and September 28, 2013 is as follows (in thousands):

						Net amount of assets presented in the Consolidated Balance Sheet
			Gross amounts offset in the Consolidated Balance Sheet					Gross amounts not offset in the Consolidated Balance Sheet
	Gross amounts of recognized assets
								Financial instruments		Cash collateral received		Net amount
Derivative assets, as of September 27, 2014	$	9,830	$	(334	)	$	9,496	$	—	$	—	$	9,496
Derivative assets, as of September 28, 2013		13		—			13		—		—		13

Schedule of offsetting of financial liabilities and derivative liabilities

Offsetting of financial liabilities and derivative liabilities as of September 27, 2014 and September 28, 2013 is as follows (in thousands):

						Net amount of assets presented in the Consolidated Balance Sheet
			Gross amounts offset in the Consolidated Balance Sheet					Gross amounts not offset in the Consolidated Balance Sheet
	Gross amounts of recognized assets
								Financial instruments		Cash collateral received		Net amount
Derivative liabilities, as of September 27, 2014	$	3,705	$	(334	)	$	3,371	$	—	$	—	$	3,371
Derivative liabilities, as of September 28, 2013		11,207		—			11,207		—		—		11,207

Summary of outstanding coffee futures contracts

The following table summarizes the coffee futures contracts outstanding as of September 27, 2014 (in thousands, except for average contract price and "C" price):

Coffee Pounds		Average Contract Price		"C" Price		Maturity		Fair Value of Futures Contracts
	900	$	1.27	$	1.94		July 2015	$	602
	4,725	$	1.27	$	1.94		July 2015		3,169
	938	$	2.13	$	1.94		July 2015		(174	)
	937	$	2.12	$	1.95		September 2015		(160	)
	7,500							$	3,437

The following table summarizes the coffee futures contracts outstanding as of September 28, 2013 (in thousands, except for average contract price and "C" price):

Coffee Pounds		Average Contract Price		"C" Price		Maturity		Fair Value of Futures Contracts
	375	$	1.50	$	1.14		December 2013	$	(138	)
	5,887	$	1.39	$	1.17		March 2014		(1,308	)
	11,438	$	1.30	$	1.19		May 2014		(1,222	)
	10,875	$	1.32	$	1.21		July 2014		(1,141	)
	28,575							$	(3,809	)

Summary of gain (loss), gross of tax, on financial instruments that qualify for hedge accounting included in OCI

The following table summarizes the amount of gain (loss), gross of tax, arising during the period on financial instruments that qualify for hedge accounting included in OCI (in thousands):

	Fiscal 2014		Fiscal 2013			Fiscal 2012
Cash Flow Hedges:
Interest rate swaps	$	2,634	$	3,014		$	1,250
Coffee futures		17,824		(6,617	)		(2,484	)
Foreign currency forward contracts		183		(129	)		—
Total	$	20,641	$	(3,732	)	$	(1,234	)

Summary of gains (losses), gross of tax, reclassified from OCI to income

The following table summarizes the amount of gain (loss), gross of tax, reclassified from OCI to income (in thousands):

	Fiscal 2014			Fiscal 2013			Fiscal 2012			Location of Gain or (Loss) Reclassified from OCI into Income
Coffee futures		(6,387	)		(1,482	)		(1,359	)	Cost of sales
Foreign currency forward contracts		74			—			—		Cost of sales
Foreign currency forward contracts		(2	)		(2	)		—		(Loss) gain on foreign currency, net
Total	$	(6,315	)	$	(1,484	)	$	(1,359	)

Summary of the amount of gain (loss), gross of tax, on fair value hedges and related hedged items

The following table summarizes the amount of gain (loss), gross of tax, on fair value hedges and related hedged items (in thousands):

	Fiscal 2014		Fiscal 2013			Fiscal 2012			Location of gain (loss) recognized in income on derivative
Foreign currency forward contracts
Net loss on hedging derivatives	$	—	$	(10	)	$	(48	)	(Loss) gain on foreign currency, net
Net gain on hedged items	$	—	$	10		$	48		(Loss) gain on foreign currency, net

Schedule of net gains on financial instruments not designated as hedges for accounting purposes

Net gains (losses) on financial instruments not designated as hedges for accounting purposes are as follows (in thousands):

	Fiscal 2014		Fiscal 2013		Fiscal 2012			Location of net gain (loss) in Consolidated Statements of Operations
Net gain (loss) on cross currency swap	$	8,307	$	5,513	$	(4,918	)	Gain (loss) on financial instruments, net
Net gain on coffee futures		7,005		—		—		Cost of sales
Net loss on interest rate cap		—		—		(34	)	Gain (loss) on financial instruments, net
Net gain on coffee futures		—		—		7		Gain (loss) on financial instruments, net
Total	$	15,312	$	5,513	$	(4,945	)

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Segment Reporting (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended												12 Months Ended
	Sep. 27, 2014	Jun. 28, 2014	Mar. 29, 2014	Dec. 28, 2013	Sep. 28, 2013	Jun. 29, 2013	Mar. 30, 2013	Dec. 29, 2012	Sep. 29, 2012	Jun. 23, 2012	Mar. 24, 2012	Dec. 24, 2011	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Segment Reporting
Net sales	$ 1,195,567	$ 1,022,371	$ 1,103,072	$ 1,386,670	$ 1,047,177	$ 967,072	$ 1,004,792	$ 1,339,059	$ 946,736	$ 869,194	$ 885,052	$ 1,158,216	$ 4,707,680	$ 4,358,100	$ 3,859,198
Operating income (loss)													947,241	765,227	568,896
Depreciation and amortization													257,639	229,193	181,647
Stock compensation													30,673	26,081	17,868
Corporate, Non-Segment [Member]
Segment Reporting
Operating income (loss)													(171,941)	(148,539)	(84,251)
Depreciation and amortization													9,776	1,500	1,941
Stock compensation													13,873	13,653	8,170
Domestic Segment [Member]
Segment Reporting
Net sales													4,083,326	3,725,008	3,233,674
Operating income (loss)													1,016,577	826,092	576,949
Depreciation and amortization													185,874	162,359	116,722
Stock compensation													14,071	9,909	7,808
Canada Segment [Member]
Segment Reporting
Net sales													624,354	633,092	625,524
Operating income (loss)													102,605	87,674	76,198
Depreciation and amortization													61,989	65,334	62,984
Stock compensation													$ 2,729	$ 2,519	$ 1,890

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Derivative Financial Instruments (Details 5) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 27, 2014 lb	Sep. 28, 2013 lb
Summary of outstanding coffee futures contracts
Fair Value of Futures Contracts	$ 6,125	$ (11,194)
Commodity Contract [Member]
Summary of outstanding coffee futures contracts
Coffee Pounds	7,500,000	28,575,000
Fair Value of Futures Contracts	3,437	(3,809)
Commodity Contract [Member] | Coffee Futures Contract One [Member]
Summary of outstanding coffee futures contracts
Coffee Pounds	900,000
Average Contract Price	1.27
"C" Price	1.94
Fair Value of Futures Contracts	602
Commodity Contract [Member] | Coffee Futures Contract Two [Member]
Summary of outstanding coffee futures contracts
Coffee Pounds	4,725,000
Average Contract Price	1.27
"C" Price	1.94
Fair Value of Futures Contracts	3,169
Commodity Contract [Member] | Coffee Futures Contract Three [Member]
Summary of outstanding coffee futures contracts
Coffee Pounds	938,000
Average Contract Price	2.13
"C" Price	1.94
Fair Value of Futures Contracts	(174)
Commodity Contract [Member] | Coffee Futures Contract Four [Member]
Summary of outstanding coffee futures contracts
Coffee Pounds	937,000
Average Contract Price	2.12
"C" Price	1.95
Fair Value of Futures Contracts	(160)
Commodity Contract [Member] | Coffee Futures Contract Five [Member]
Summary of outstanding coffee futures contracts
Coffee Pounds		375,000
Average Contract Price		1.50
"C" Price		1.14
Fair Value of Futures Contracts		(138)
Commodity Contract [Member] | Coffee Futures Contract Six [Member]
Summary of outstanding coffee futures contracts
Coffee Pounds		5,887,000
Average Contract Price		1.39
"C" Price		1.17
Fair Value of Futures Contracts		(1,308)
Commodity Contract [Member] | Coffee Futures Contract Seven [Member]
Summary of outstanding coffee futures contracts
Coffee Pounds		11,438,000
Average Contract Price		1.30
"C" Price		1.19
Fair Value of Futures Contracts		(1,222)
Commodity Contract [Member] | Coffee Futures Contract Eight [Member]
Summary of outstanding coffee futures contracts
Coffee Pounds		10,875,000
Average Contract Price		1.32
"C" Price		1.21
Fair Value of Futures Contracts		$ (1,141)

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Sep. 27, 2014	Sep. 28, 2013
Current assets:
Cash and cash equivalents	$ 761,214	$ 260,092
Restricted cash and cash equivalents	378	560
Short-term investment	100,000
Receivables, less uncollectible accounts and return allowances of $66,120 and $33,640 at September 27, 2014 and September 28, 2013, respectively	621,451	467,976
Inventories	835,167	676,089
Income taxes receivable		11,747
Other current assets	69,272	46,891
Deferred income taxes, net	58,038	58,137
Total current assets	2,445,520	1,521,492
Fixed assets, net	1,171,425	985,563
Intangibles, net	365,444	435,216
Goodwill	755,895	788,184
Deferred income taxes, net	131	149
Other long-term assets	58,892	30,944
Total assets	4,797,307	3,761,548
Current liabilities:
Current portion of long-term debt	19,077	12,929
Current portion of capital lease and financing obligations	2,226	1,760
Accounts payable	411,107	312,170
Accrued expenses	305,677	242,427
Income tax payable	53,586
Dividend payable	40,580
Deferred income taxes, net	340	233
Other current liabilities	10,395	27,544
Total current liabilities	842,988	597,063
Long-term debt, less current portion	140,937	160,221
Capital lease and financing obligations, less current portion	116,240	76,061
Deferred income taxes, net	202,936	252,867
Other long-term liabilities	23,085	28,721
Commitments and contingencies (See Notes 5 and 19)
Redeemable noncontrolling interests	12,440	11,045
Stockholders' equity:
Preferred stock, $0.10 par value: Authorized - 1,000,000 shares; No shares issued or outstanding
Common stock, $0.10 par value: Authorized - 500,000,000 shares; Issued and outstanding - 162,318,246 and 150,265,809 shares at September 27, 2014 and September 28, 2013, respectively	16,232	15,026
Additional paid-in capital	1,808,881	1,387,322
Retained earnings	1,687,619	1,252,407
Accumulated other comprehensive (loss) income	(54,051)	(19,185)
Total stockholders' equity	3,458,681	2,635,570
Total liabilities and stockholders' equity	$ 4,797,307	$ 3,761,548

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Accrued Expenses (Tables)

12 Months Ended

Sep. 27, 2014

Accrued Expenses

Schedule of accrued expenses

Accrued expenses consisted of the following (in thousands) as of:

	September 27, 2014		September 28, 2013
Accrued compensation costs	$	101,734	$	91,418
Accrued customer incentives and promotions		74,578		53,689
Accrued freight, fulfillment and transportation costs		30,108		21,941
Accrued legal and professional services		18,635		8,278
Warranty reserve		12,850		7,804
Other		67,772		59,297
	$	305,677	$	242,427

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Commitments and Contingencies (Details 3) (USD $) In Millions, unless otherwise specified	0 Months Ended			12 Months Ended
	Apr. 27, 2012 claim	Nov. 09, 2010 claim	Sep. 28, 2010 claim	Sep. 27, 2014 claim
Pending Litigation [Member] | Council for Education and Research on Toxics vs Brad Barry LLC and Starbucks Corp [Member]
Legal Proceedings
Number of affirmative defenses shared by all defendants				3
Pending Litigation [Member] | Putative Securities Fraud Class Actions [Member]
Legal Proceedings
Number of pending actions				1
Pending Litigation [Member] | Putative Stockholder Derivative Actions [Member]
Legal Proceedings
Number of pending actions				2
Pending Litigation [Member] | Consolidated Putative Stockholder Derivative Action District of Vermont [Member]
Legal Proceedings
Number of separate complaints in consolidated action				5
Number of separate complaints filed after disclosure of SEC Inquiry			2
Number of separate complaints ordered by federal court to be consolidated into the action	2	2
Pending Litigation [Member] | Antitrust Litigation Putative Class Action [Member]
Legal Proceedings
Number of pending actions				27
Damages from Product Defects [Member]
Legal Proceedings
Net charge for estimated cost related to potential issue with certain Keurig brewers				$ 10.0

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Consolidated Statement of Changes in Stockholders' Equity (USD $) In Thousands, except Share data, unless otherwise specified	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Total
Balance at Sep. 24, 2011	$ 15,447	$ 1,499,616	$ 411,727	$ (14,575)	$ 1,912,215
Balance (in shares) at Sep. 24, 2011	154,466,463
Increase (Decrease) in Stockholders' Equity
Options exercised	94	3,300			3,394
Options exercised (in shares)	940,369
Issuance of common stock under employee stock purchase plan	30	8,668			8,698
Issuance of common stock under employee stock purchase plan (in shares)	301,971
Restricted stock awards and units	5	(5)
Restricted stock awards and units (in shares)	55,747
Issuance of common stock under deferred compensation plan	4	(4)
Issuance of common stock under deferred compensation plan (in shares)	37,005
Repurchase of common stock	(312)	(76,158)			(76,470)
Repurchase of common stock (in shares)	(3,120,700)
Stock compensation expense		17,868			17,868
Tax benefit from equity-based compensation plans		11,064			11,064
Deferred compensation expense		211			211
Adjustment of redeemable noncontrolling interests to redemption value			(3,155)		(3,155)
Other comprehensive income (loss), net of tax				24,775	24,775
Net income			362,628		362,628
Balance at Sep. 29, 2012	15,268	1,464,560	771,200	10,200	2,261,228
Balance (in shares) at Sep. 29, 2012	152,680,855
Increase (Decrease) in Stockholders' Equity
Options exercised	285	19,532			19,817
Options exercised (in shares)	2,849,308
Issuance of common stock under employee stock purchase plan	34	9,926			9,960
Issuance of common stock under employee stock purchase plan (in shares)	343,678
Restricted stock awards and units	3	(3)
Restricted stock awards and units (in shares)	34,761
Repurchase of common stock	(564)	(187,714)			(188,278)
Repurchase of common stock (in shares)	(5,642,793)
Stock compensation expense		26,081			26,081
Tax benefit from equity-based compensation plans		54,706			54,706
Deferred compensation expense		234			234
Adjustment of redeemable noncontrolling interests to redemption value			(2,025)		(2,025)
Other comprehensive income (loss), net of tax				(29,385)	(29,385)
Net income			483,232		483,232
Balance at Sep. 28, 2013	15,026	1,387,322	1,252,407	(19,185)	2,635,570
Balance (in shares) at Sep. 28, 2013	150,265,809				150,265,809
Increase (Decrease) in Stockholders' Equity
Sale of common stock	1,809	1,346,605			1,348,414
Sale of common stock (in shares)	18,091,139
Options exercised	187	27,930			28,117
Options exercised (in shares)	1,872,448
Issuance of common stock under employee stock purchase plan	18	12,546			12,564
Issuance of common stock under employee stock purchase plan (in shares)	170,531
Restricted stock awards and units	6	(6)
Restricted stock awards and units (in shares)	56,911
Repurchase of common stock	(814)	(1,051,616)			(1,052,430)
Repurchase of common stock (in shares)	(8,138,592)
Stock compensation expense		30,673			30,673
Tax benefit from equity-based compensation plans		55,218			55,218
Deferred compensation expense		209			209
Adjustment of redeemable noncontrolling interests to redemption value			(2,368)		(2,368)
Other comprehensive income (loss), net of tax				(34,866)	(34,866)
Net income			596,518		596,518
Cash dividends declared			(158,938)		(158,938)
Balance at Sep. 27, 2014	$ 16,232	$ 1,808,881	$ 1,687,619	$ (54,051)	$ 3,458,681
Balance (in shares) at Sep. 27, 2014	162,318,246				162,318,246

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Commitments and Contingencies (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Lease Commitments
Total rent expense	$ 24.8	$ 23.1	$ 25.1
Sublease income	$ 1.0	$ 1.1	$ 0.3
Maximum [Member]
Lease Commitments
Operating leases term	20 years
Minimum [Member]
Lease Commitments
Operating leases term	1 year

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Goodwill and Intangible Assets (Details 2) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Indefinite-lived intangible assets
Impairment of goodwill or indefinite-lived intangible assets	$ 0	$ 0	$ 0
Indefinite-lived Intangible Assets Including Goodwill [Member]
Indefinite-lived intangible assets
Royalty rate	3.00%
Indefinite-lived Intangible Assets Including Goodwill [Member] | Minimum [Member]
Indefinite-lived intangible assets
Discount rate	13.00%
Indefinite-lived Intangible Assets Including Goodwill [Member] | Maximum [Member]
Indefinite-lived intangible assets
Discount rate	14.00%
Domestic Segment [Member] | Indefinite-lived Intangible Assets Including Goodwill [Member]
Indefinite-lived intangible assets
Income tax rate	38.00%
Canada Segment [Member] | Indefinite-lived Intangible Assets Including Goodwill [Member]
Indefinite-lived intangible assets
Income tax rate	27.50%
Trade Names [Member] | Canada Segment [Member]
Indefinite-lived intangible assets
Indefinite-lived intangible assets	$ 90,257	$ 97,740

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Earnings Per Share (Details 2) (Stock Compensation Plan [Member])	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Stock Compensation Plan [Member]
Antidilutive securities
Antidilutive securities excluded from computation of earnings per share (in shares)	277,000	822,000	763,000

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Fixed Assets (Tables)

12 Months Ended

Sep. 27, 2014

Fixed Assets

Schedule of fixed assets

Fixed assets consisted of the following (in thousands) as of:

	Useful Life in Years		September 27, 2014			September 28, 2013
Production equipment		1-15	$	779,850		$	680,457
Coffee service equipment		3-7		61,029			59,169
Computer equipment and software		1-6		177,878			146,246
Land		Indefinite		12,767			11,520
Building and building improvements		4-30		238,945			134,495
Furniture and fixtures		1-15		36,899			33,975
Vehicles		4-5		13,032			11,786
Leasehold improvements		1-20 or remaining life of lease, whichever is less		95,373			98,990
Assets acquired under capital leases		5-15		41,200			41,200
Construction-in-progress				308,976			202,940
Total fixed assets			$	1,765,949		$	1,420,778
Accumulated depreciation				(594,524	)		(435,215	)
			$	1,171,425		$	985,563

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Long-Term Debt (Details 2) (USD $) In Millions, unless otherwise specified	12 Months Ended						12 Months Ended			12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 27, 2014 Eurodollar [Member] Minimum [Member]	Sep. 27, 2014 Restated Credit Agreement [Member]	Sep. 28, 2013 Restated Credit Agreement [Member]	Sep. 24, 2011 Restated Credit Agreement [Member]	Sep. 27, 2014 Restated Credit Agreement [Member] Base Rate [Member] Minimum [Member]	Sep. 27, 2014 Restated Credit Agreement [Member] Base Rate [Member] Maximum [Member]	Sep. 27, 2014 Restated Credit Agreement [Member] Eurodollar [Member]	Sep. 27, 2014 Restated Credit Agreement [Member] Eurodollar [Member] Maximum [Member]	Sep. 27, 2014 Restated Credit Agreement [Member] Federal Funds Rate [Member]	Sep. 27, 2014 Restated Credit Agreement [Member] Domestic Line of Credit [Member]	Sep. 27, 2014 Restated Credit Agreement [Member] Foreign Line of Credit [Member]
Long-term debt
Credit facility												$ 800.0	$ 200.0
Aggregate amount of increase option				500.0
Margin added to reference rate for base rate (as a percent)									1.00%		0.50%
Applicable margin added to reference rate for variable interest (as a percent)			1.50%				0.50%	1.00%		2.00%
Average effective interest rate (as a percent)	3.70%	3.50%
Commitment fee on revolving credit facilities (as a percent)				0.20%
Outstanding letters of credit				7.8	5.0
Amounts drawn against letters of credit				0	0
Debt issuance costs deferred to be amortized over the life off the loan						$ 46.0

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Employee Compensation Plans

12 Months Ended

Sep. 27, 2014

Employee Compensation Plans

Employee Compensation Plans

15.   Employee Compensation Plans

Equity-Based Incentive Plans

On March 6, 2014, the Company registered on Form S-8 shares of common stock pursuant to the 2014 Omnibus Plan (the "2014 Plan"), which replaced the 2006 Incentive Plan (the "2006 Plan") and increased the total shares of common stock authorized for issuance to 8,000,000 (the "Fungible Pool Limit"). Both plans provide for the issuance of several types of share-based incentive compensation including stock options, stock appreciation rights, restricted stock, restricted stock units and performance stock units. Following shareholder approval of the 2014 Plan, there were no further awards made under the 2006 Plan. Under the 2014 Plan, each share of common stock issued or to be issued in connection with any award that is not a stock option or stock appreciation right shall be counted against the Fungible Pool Limit as 1.704 Fungible Pool Units. Stock options and stock appreciation rights shall be counted against the Fungible Pool Limit as 1.0 Fungible Pool Unit. Both the 2014 Plan and 2006 Plan require the exercise price for all awards requiring exercise to be no less than 100% of fair market value per share of common stock on the date of grant, with certain provisions which increase the option exercise price of an incentive stock option to 110% of the fair market value of the common stock if the grantee owns in excess of 10% of the Company's common stock at the date of grant. As of September 27, 2014, 7.3 million shares of common stock were available for grant for future equity-based compensation awards under the 2014 Plan.

Options under the 2006 Plan and 2014 Plan become exercisable over periods determined by the Board of Directors, generally in the range of three to five years.

As of September 27, 2014, 39,251 options remain outstanding under Keurig, Incorporated 2005 Stock Option Plan assumed in the 2006 acquisition of Keurig, Incorporated as well as stock options related to two previous inducement grants of non-qualified options to two officers of the Company which were not subject to shareholder approval.

Option activity is summarized as follows:

	Number of Shares			Weighted Average Exercise Price (per share)
Outstanding at September 28, 2013		5,022,340		$	18.30
Granted		386,309		$	73.53
Exercised		(1,872,448	)	$	15.02
Forfeited/expired		(99,474	)	$	54.56
Outstanding at September 27, 2014		3,436,727		$	25.24
Exercisable at September 27, 2014		2,541,149		$	13.68

The following table summarizes information about stock options that have vested and are expected to vest at September 27, 2014:

Number of options outstanding	Weighted average remaining contractual life (in years)		Weighted average exercise price		Intrinsic value at September 27, 2014 (in thousands)
3,428,994		4.66	$	25.15	$	361,691

The following table summarizes information about stock options exercisable at September 27, 2014:

Number of options exercisable	Weighted average remaining contractual life (in years)		Weighted average exercise price		Intrinsic value at September 27, 2014 (in thousands)
2,541,149		3.40	$	13.68	$	297,200

Compensation expense is recognized only for those options expected to vest, with forfeitures estimated based on the Company's historical employee turnover experience and future expectations.

The Company uses a blend of recent and historical volatility to estimate expected volatility at the measurement date. The expected life of options is estimated based on options vesting periods, contractual lives and an analysis of the Company's historical experience.

The intrinsic values of options exercised during fiscal years 2014, 2013 and 2012 were approximately $167.0 million, $165.5 million and $46.6 million, respectively. The Company's policy is to issue new shares upon exercise of stock options.

The grant-date fair value of employee share options and similar instruments is estimated using the Black-Scholes option-pricing model with the following assumptions for grants issued during fiscal years 2014, 2013 and 2012:

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Average expected life		5.5 years			6.0 years			6.0 years
Average volatility		74	%		81	%		69	%
Dividend yield		1.30	%		—	%		—	%
Risk-free interest rate		1.70	%		1.02	%		1.31	%
Weighted average fair value	$	42.38		$	31.23		$	30.10

Restricted Stock Units and Other Awards

The Company awards restricted stock units ("RSUs"), restricted stock awards ("RSAs"), and performance stock units ("PSUs") to eligible employees ("Grantee") which entitle the Grantee to receive shares of the Company's common stock. RSUs and PSUs are awards denominated in units that are settled in shares of the Company's common stock upon vesting. RSAs are awards of common stock that are restricted until the shares vest. In general, RSUs and RSAs vest based on a Grantee's continuing employment. The fair value of RSUs, RSAs and PSUs is based on the closing price of the Company's common stock on the grant date. Compensation expense for RSUs and RSAs is recognized ratably over a Grantee's service period. Compensation expense for PSUs is also recognized over a Grantee's service period, but only if and when the Company concludes that it is probable (more than likely) the performance condition(s) will be achieved. The assessment of probability of achievement is performed each period based on the relevant facts and circumstances at that time, and if the estimated grant-date fair value changes as a result of that assessment, the cumulative effect of the change on current and prior periods is recognized in the period of change. In addition, the Company has awarded deferred cash awards ("DCAs"), to Grantees which entitle a Grantee to receive cash paid over time upon vesting. The vesting of DCAs is conditioned on a Grantee's continuing employment. All awards are reserved for issuance under the 2006 Plan, and beginning with awards granted after March 6, 2014, the 2014 Plan. These awards vest over periods determined by the Board of Directors, generally in the range of three to four years for RSUs, RSAs and DCAs, and three years for PSUs.

The following table summarizes the number and weighted average grant-date fair value of nonvested RSUs (amounts in thousands except grant date fair value and weighted average remaining contractual life):

	Share Units			Weighted Average Grant-Date Fair Value		Weighted Average Remaining Contractual Life (in Years)		Intrinsic Value (in Thousands)
Nonvested, September 28, 2013		221,502		$	42.74		1.71	$	16,586
Granted		259,507		$	119.95
Vested		(56,781	)	$	61.04
Forfeited		(15,055	)	$	82.00
Nonvested, September 27, 2014		409,173		$	86.50		3.26	$	53,450

As of September 27, 2014, total RSUs expected to vest totaled 406,521 shares with an intrinsic value of $53.1 million. The weighted average grant-date fair value of RSUs granted was $119.95 and $45.19 for fiscal 2014 and fiscal 2013, respectively.

The total intrinsic value of RSUs converted to shares of common stock during fiscal 2014 and fiscal 2013 was $6.1 million and $2.2 million, respectively.

The following table summarizes the number and weighted average grant-date fair value of nonvested PSUs based on the target award amounts in the PSU agreements as of September 27, 2014:

	Share Units			Weighted Average Grant-Date Fair Value
Outstanding on September 28, 2013		120,668		$	41.10
Granted		84,232		$	107.12
Forfeited		(9,118	)	$	86.87
Outstanding on September 27, 2014(1)		195,782		$	67.38

(1) The outstanding PSUs as of September 27, 2014, at the threshold award and maximum award levels were 172,313 and 297,689, respectively.

The weighted average grant-date fair value of PSUs granted was $107.12 in fiscal 2014 compared to $41.28 in 2013. There were no PSUs converted to shares of common stock during fiscal 2014.

In addition, during fiscal 2012 the Company issued a grant for 55,432 RSAs which vested in fiscal 2013 with a total intrinsic value of $2.7 million.

Employee Stock Purchase Plan

On March 6, 2014, the Company registered on Form S-8 shares pursuant to the 2014 Amended and Restated Employee Stock Purchase Plan ("2014 ESPP") which replaced the Amended and Restated Employee Stock Purchase Plan ("2008 ESPP"). Under both plans, eligible employees may purchase shares of the Company's common stock, subject to certain limitations, at the lesser of 85 percent of the beginning or ending withholding period fair market value as defined in the plan. There were two six-month withholding periods in each fiscal year. As of September 27, 2014, rights to acquire 2,045,520 shares of common stock were available for issuance under the 2014 ESPP.

The grant-date fair value of employees' purchase rights granted during fiscal years 2014, 2013 and 2012 under the Company's ESPP is estimated using the Black-Scholes option-pricing model with the following assumptions:

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Average expected life		6 months			6 months			6 months
Average volatility		55	%		86	%		70	%
Dividend yield		1.14	%		—	%		—	%
Risk-free interest rate		0.06	%		0.13	%		0.90	%
Weighted average fair value	$	26.06		$	14.38		$	11.61

Stock-Based Compensation Expense

Stock-based compensation expense recognized in the Consolidated Statements of Operations in fiscal years 2014, 2013, and 2012 (in thousands):

	Fiscal 2014		Fiscal 2013		Fiscal 2012
Options	$	13,029	$	14,151	$	12,595
RSUs/PSUs/RSAs		13,200		7,529		1,861
ESPP		4,444		4,401		3,412
Total stock-based compensation expense recognized in the Consolidated Statements of Operations	$	30,673	$	26,081	$	17,868
Total related tax benefit	$	12,005	$	9,936	$	6,004

As of September 27, 2014, total unrecognized compensation cost related to all nonvested stock-based compensation arrangements was approximately $55.2 million net of estimated forfeitures. This unrecognized cost is expected to be recognized over a weighted-average period of approximately 1.8 years at September 27, 2014.

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Goodwill and Intangible Assets (Tables)

12 Months Ended

Sep. 27, 2014

Goodwill and Intangible Assets

Schedule of changes in the carrying amount of goodwill

The following represented the change in the carrying amount of goodwill by segment for fiscal 2014 and 2013 (in thousands):

	Domestic		Canada			Total
Balance as of September 29, 2012	$	369,353	$	438,723		$	808,076
Foreign currency effect		—		(19,892	)		(19,892	)
Balance as of September 28, 2013	$	369,353	$	418,831		$	788,184
Other	$	—	$	(233	)	$	(233	)
Foreign currency effect	$	—	$	(32,056	)	$	(32,056	)
Balance as of September 27, 2014	$	369,353	$	386,542		$	755,895

Schedule of indefinite-lived intangible assets

Indefinite-lived intangible assets included in the Canada operating segment consisted of the following (in thousands) as of:

	September 27, 2014		September 28, 2013
Trade names	$	90,257	$	97,740

Schedule of definite-lived intangible assets

Definite-lived intangible assets consisted of the following (in thousands) as of:

			September 27, 2014					September 28, 2013
	Useful Life in Years		Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Acquired technology		4-10	$	16,501	$	(13,713	)	$	21,609	$	(17,123	)
Customer and roaster agreements		8-11		8,939		(5,303	)		26,977		(19,750	)
Customer relationships		2-16		390,563		(141,163	)		414,967		(113,061	)
Trade names		9-11		35,911		(16,548	)		37,200		(13,353	)
Non-compete agreements		2-5		—		—			374		(364	)
Total			$	451,914	$	(176,727	)	$	501,127	$	(163,651	)

Schedule of estimated aggregate amortization expense over each of the next five years and thereafter

The estimated aggregate amortization expense over each of the next five years and thereafter, is as follows (in thousands):

2015	40,452
2016	39,727
2017	38,331
2018	38,331
2019	38,231
Thereafter	80,115

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Earnings Per Share (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended												12 Months Ended
	Sep. 27, 2014	Jun. 28, 2014	Mar. 29, 2014	Dec. 28, 2013	Sep. 28, 2013	Jun. 29, 2013	Mar. 30, 2013	Dec. 29, 2012	Sep. 29, 2012	Jun. 23, 2012	Mar. 24, 2012	Dec. 24, 2011	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Numerator for basic and diluted earnings per share:
Net income attributable to GMCR	$ 141,056	$ 155,151	$ 162,084	$ 138,227	$ 126,956	$ 116,272	$ 132,421	$ 107,583	$ 91,887	$ 73,296	$ 93,031	$ 104,414	$ 596,518	$ 483,232	$ 362,628
Denominator:
Basic weighted average shares outstanding													157,085,574	149,638,636	154,933,948
Effect of dilutive securities - stock options (in shares)													2,482,768	3,162,857	4,141,698
Diluted weighted average shares outstanding													159,568,342	152,801,493	159,075,646
Basic and diluted net income per common share
Basic net income per common share (in dollars per share)	$ 0.87	$ 0.95	$ 1.05	$ 0.93	$ 0.84	$ 0.78	$ 0.89	$ 0.72	$ 0.59	$ 0.47	$ 0.60	$ 0.67	$ 3.80	$ 3.23	$ 2.34
Diluted net income per common share (in dollars per share)	$ 0.86	$ 0.94	$ 1.03	$ 0.91	$ 0.83	$ 0.76	$ 0.87	$ 0.70	$ 0.58	$ 0.46	$ 0.58	$ 0.66	$ 3.74	$ 3.16	$ 2.28

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Deferred Compensation Plans

12 Months Ended

Sep. 27, 2014

Deferred Compensation Plan

Deferred Compensation Plan

17.   Deferred Compensation Plan

The 2002 Deferred Compensation Plan, amended in December 2007 and June 2014, permits certain highly compensated officers and employees of the Company and non-employee directors to defer eligible compensation payable for services rendered to the Company. On March 8, 2013, the Company registered on Form S-8 shares related to the 2002 Deferred Compensation Plan. Participants may elect to receive deferred compensation in the form of cash payments or shares of Company Common Stock on the date or dates selected by the participant or on such other date or dates specified in the Deferred Compensation Plan. The Deferred Compensation Plan is in effect for compensation earned on or after September 29, 2002. As of September 27, 2014, and September 28, 2013, 351,276 shares and 353,434 shares of Common Stock were available for future issuance under this Plan, respectively. During fiscal 2014, rights to acquire 2,158 shares of Common Stock were granted and vested, and 130 rights to shares of Common Stock were exercised. As of September 27, 2014 and September 28, 2013, rights to acquire 61,589 and 59,561 shares of Common Stock were outstanding under this plan.

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Derivative Financial Instruments (Details) (Not Designated as Hedging Instrument [Member], Cross Currency Interest Rate Contract [Member])	12 Months Ended
	Sep. 27, 2014 USD ($)	Sep. 28, 2013 USD ($)	Sep. 29, 2012 USD ($)	Sep. 27, 2014 CAD
Other Derivatives
Period of derivative	1 year
Notional amount				90,000,000
Variable interest rate basis payable	Three month Canadian Bankers Acceptance rate
Variable interest rate basis receivable	Three month U.S. Libor rate
Additional interest expense	$ 1,300,000	$ 1,700,000	$ 1,800,000

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Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Cash flows from operating activities:
Net income	$ 597,414	$ 484,103	$ 363,500
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of fixed assets	214,607	183,814	135,656
Amortization of intangibles	43,032	45,379	45,991
Amortization of deferred financing fees	5,651	7,125	6,050
Unrealized loss (gain) on foreign currency, net	15,196	9,159	(6,557)
(Gain) loss on disposal of fixed assets	(602)	(85)	2,517
Gain on sale of subsidiary, excluding transaction costs			(28,914)
Provision for doubtful accounts	1,782	689	3,197
Provision for sales returns	114,057	79,747	107,436
(Gain) loss on derivatives, net	(1,582)	(4,507)	6,310
Excess tax benefits from equity-based compensation plans	(55,444)	(54,699)	(12,070)
Deferred income taxes	(52,708)	(17,701)	60,856
Deferred compensation and stock compensation	30,882	26,315	18,079
Other	4,826	844	(672)
Changes in assets and liabilities
Receivables	(274,884)	(187,221)	(159,317)
Inventories	(166,473)	87,677	(92,862)
Income tax payable/receivable, net	120,553	46,290	16,457
Other current assets	(838)	(12,668)	(6,900)
Other long-term assets, net	3,162	3,915	(469)
Accounts payable and accrued expenses	133,818	133,532	17,125
Other current liabilities	(7,521)	3,100	(2,718)
Other long-term liabilities	(5,495)	1,161	5,090
Net cash provided by operating activities	719,433	835,969	477,785
Cash flows from investing activities:
Change in restricted cash	182	3,005	(2,875)
Purchase of short-term investments	(100,000)
Purchase of long-term investment	(35,905)
Proceeds from the sale of subsidiary, net of cash acquired			137,733
Capital expenditures for fixed assets	(337,860)	(232,780)	(401,121)
Other investing activities	1,164	4,208	618
Net cash used in investing activities	(472,419)	(225,567)	(265,645)
Cash flows from financing activities:
Net change in revolving line of credit		(226,210)	(108,727)
Proceeds from issuance of common stock under compensation plans	40,681	29,777	12,092
Proceeds from issuance of common stock for private placement	1,348,414
Repurchase of common stock	(1,052,430)	(188,278)	(76,470)
Excess tax benefits from equity-based compensation plans	55,444	54,699	12,070
Payments on capital lease and financing obligations	(1,931)	(8,288)	(7,558)
Proceeds from borrowings of long-term debt	403
Repayment of long-term debt	(13,361)	(71,620)	(7,814)
Dividends paid	(118,358)
Purchase of noncontrolling interest	(4,752)
Other financing activities	(1,124)	(1,406)	3,283
Net cash provided by (used in) financing activities	252,986	(411,326)	(173,124)
Change in cash balances included in current assets held for sale			5,160
Effect of exchange rate changes on cash and cash equivalents	1,122	2,727	1,124
Net increase in cash and cash equivalents	501,122	201,803	45,300
Cash and cash equivalents at beginning of period	260,092	58,289	12,989
Cash and cash equivalents at end of period	761,214	260,092	58,289
Supplemental disclosures of cash flow information:
Cash paid for interest	12,043	9,129	20,783
Cash paid for income taxes	270,367	223,580	136,407
Dividends declared not paid at the end of each period	40,580
Fixed asset purchases included in accounts payable and not disbursed at the end of each period	64,202	30,541	56,127
Noncash investing and financing activities:
Fixed assets acquired under capital lease and financing obligations	40,125	27,791	66,531
Settlement of acquisition related liabilities through release of restricted cash		$ 9,227	$ 18,788

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Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Sep. 27, 2014	Sep. 28, 2013
Consolidated Balance Sheets
Receivables, uncollectible accounts and return allowances (in dollars)	$ 66,120	$ 33,640
Preferred stock, par value (in dollars per share)	$ 0.10	$ 0.10
Preferred stock, Authorized shares	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.10	$ 0.10
Common stock, Authorized shares	500,000,000	500,000,000
Common stock, Issued shares	162,318,246	150,265,809
Common stock, outstanding shares	162,318,246	150,265,809

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Long-Term Debt

12 Months Ended

Sep. 27, 2014

Long-Term Debt

Long-Term Debt

10.   Long-Term Debt

Long-term debt outstanding consists of the following (in thousands) as of:

	September 27, 2014		September 28, 2013
Term loan A		158,438		170,937
Other		1,576		2,213
Total long-term debt	$	160,014	$	173,150
Less current portion		19,077		12,929
Long-term portion	$	140,937	$	160,221

Under the Company's current credit facility ("Restated Credit Agreement"), the Company maintains senior secured credit facilities consisting of (i) an $800.0 million U.S. revolving credit facility, (ii) a $200.0 million alternative currency revolving credit facility, and (iii) a term loan A facility. The Restated Credit Agreement also provides for an increase option for an aggregate amount of up to $500.0 million.

The term loan A facility requires quarterly principal repayments. The term loan and revolving credit borrowings bear interest at a rate equal to an applicable margin plus, at our option, either (a) a eurodollar rate determined by reference to the cost of funds for deposits for the interest period and currency relevant to such borrowing, adjusted for certain costs, or (b) a base rate determined by reference to the highest of (1) the federal funds rate plus 0.50%, (2) the prime rate announced by Bank of America, N.A. from time to time and (3) the eurodollar rate plus 1.00%. The applicable margin under the Restated Credit Agreement with respect to term loan A and revolving credit facilities is a percentage per annum varying from 0.5% to 1.0% for base rate loans and 1.5% to 2.0% for eurodollar loans, based upon the Company's leverage ratio. The Company's average effective interest rate as of September 27, 2014 and September 28, 2013 was 3.7% and 3.5%, respectively, excluding amortization of deferred financing charges and including the effect of interest swap agreements. The Company also pays a commitment fee of 0.2% on the average daily unused portion of the revolving credit facilities.

All the assets of the Company and its domestic wholly-owned material subsidiaries are pledged as collateral under the Restated Credit Agreement. The Restated Credit Agreement contains customary negative covenants, subject to certain exceptions, including limitations on: liens; investments; indebtedness; merger and consolidations; asset sales; dividends and distributions or repurchases of the Company's capital stock; transactions with affiliates; certain burdensome agreements; and changes in the Company's lines of business.

The Restated Credit Agreement requires the Company to comply on a quarterly basis with a consolidated leverage ratio and a consolidated interest coverage ratio. As of September 27, 2014 and throughout fiscal year 2014, the Company was in compliance with these covenants. In addition, the Restated Credit Agreement contains certain mandatory prepayment requirements and customary events of default.

As of September 27, 2014 and September 28, 2013, outstanding letters of credit under the Restated Credit Agreement, totaled $7.8 million and $5.0 million, respectively. No amounts have been drawn against the letters of credit as of September 27, 2014 and September 28, 2013.

In connection with the Restated Credit Agreement, the Company incurred debt issuance costs of $46.0 million which were deferred and included in Other Long-Term Assets on the Consolidated Balance Sheet and amortized as interest expense over the life of the respective loan using a method that approximates the effective interest rate method.

The Company enters into interest rate swap agreements to limit a portion of its exposure to variable interest rates by entering into interest rate swap agreements which effectively fix the rates. In accordance with the interest rate swap agreements and on a monthly basis, interest expense is calculated based on the floating 30-day Libor rate and the fixed rate. If interest expense as calculated is greater based on the 30-day Libor rate, the interest rate swap counterparty pays the difference to the Company; if interest expense as calculated is greater based on the fixed rate, the Company pays the difference to the interest rate swap counterparty. See Note 11, Derivative Financial Instruments.  

Below is a summary of the Company's derivative instruments in effect as of September 27, 2014 mitigating interest rate exposure of variable-rate borrowings (in thousands):

Derivative Instrument	Hedged Transaction	Notional Amount of Underlying Debt		Fixed Rate Received			Maturity (Fiscal Year)
Swap	30-day Libor		30,000		2.54	%		2016
Swap	30-day Libor		50,000		2.54	%		2016
Swap	30-day Libor		20,000		2.54	%		2016
Swap	30-day Libor		30,000		2.54	%		2016
		$	130,000

In fiscal years 2014, 2013 and 2012 the Company paid approximately $3.2 million, $3.4 million and $4.7 million, respectively, in additional interest expense pursuant to the interest rate swap agreements.

Maturities

Scheduled maturities of long-term debt are as follows (in thousands):

Fiscal Year
2015		19,077
2016		140,022
2017		348
2018		364
2019		203
	$	160,014

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Accrued Expenses (Details) (USD $) In Thousands, unless otherwise specified	Sep. 27, 2014	Sep. 28, 2013
Accrued Expenses
Accrued compensation costs	$ 101,734	$ 91,418
Accrued customer incentives and promotions	74,578	53,689
Accrued freight, fulfillment and transportation costs	30,108	21,941
Accrued legal and professional services	18,635	8,278
Warranty reserve	12,850	7,804
Other	67,772	59,297
Total accrued expenses	$ 305,677	$ 242,427

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Employee Retirement Plans (Details 2) (Supplemental Employee Retirement Plan [Member], USD $) In Millions, unless otherwise specified	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Supplemental Employee Retirement Plan [Member]
Defined Benefit Plans
Plan assets	$ 0
Projected benefit obligation classified in other long-term liabilities	1.4	1.4
Net periodic pension expense (income)	$ 0.2	$ 0.3	$ (0.1)

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Document and Entity Information (USD $)	12 Months Ended
	Sep. 27, 2014	Nov. 14, 2014	Mar. 29, 2014
Document and Entity Information
Entity Registrant Name	KEURIG GREEN MOUNTAIN, INC.
Entity Central Index Key	0000909954
Document Type	10-K
Document Period End Date	Sep. 27, 2014
Amendment Flag	false
Current Fiscal Year End Date	--09-27
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$ 17,446,088,000
Entity Common Stock, Shares Outstanding		162,009,539
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	FY

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Derivative Financial Instruments

12 Months Ended

Sep. 27, 2014

Derivative Financial Instruments

Derivative Financial Instruments

11.   Derivative Financial Instruments

Cash Flow Hedges

The Company is exposed to certain risks relating to ongoing business operations. The primary risks that are mitigated by financial instruments are interest rate risk, commodity price risk and foreign currency exchange rate risk. The Company uses interest rate swaps to mitigate interest rate risk associated with the Company's variable-rate borrowings, enters into coffee futures contracts to hedge future coffee purchase commitments of green coffee with the objective of minimizing cost risk due to market fluctuations, and uses foreign currency forward contracts to hedge the purchase and payment of green coffee purchase commitments denominated in non-functional currencies.

The Company designates these contracts as cash flow hedges and measures the effectiveness of these derivative instruments at each balance sheet date. The changes in the fair value of these instruments are classified in accumulated other comprehensive income (loss). The gains or loss on these instruments is reclassified from OCI into earnings in the same period or periods during which the hedged transaction affects earnings. If it is determined that a derivative is not highly effective, the gain or loss is reclassified into earnings.

Fair Value Hedges

In prior fiscal years, the Company entered into foreign currency forward contracts to hedge certain recognized liabilities in currencies other than the Company's functional currency. The Company designated these contracts as fair value hedges and measured the effectiveness of the derivative instruments at each balance sheet date. The changes in the fair value of these instruments along with the changes in the fair value of the hedged liabilities were recognized in net gains or losses on foreign currency on the consolidated statements of operations.

Other Derivatives

The Company is also exposed to certain foreign currency and interest rate risks on an intercompany note with a foreign subsidiary denominated in Canadian currency. At September 27, 2014, the Company has approximately one year remaining on a CDN $90.0 million, Canadian cross currency swap to exchange interest payments and principal on the intercompany note. This cross currency swap is not designated as a hedging instrument for accounting purposes and is recorded at fair value, with the changes in fair value recognized in the Consolidated Statements of Operations. Gains and losses resulting from the change in fair value are largely offset by the financial impact of the re-measurement of the intercompany note. In accordance with the cross currency swap agreement, on a quarterly basis, the Company pays interest based on the three month Canadian Bankers Acceptance rate and receives interest based on the three month U.S. Libor rate. The Company incurred $1.3 million, $1.7 million, and $1.8 million in additional interest expense pursuant to the cross currency swap agreement during fiscal 2014, 2013, and 2012 respectively.

The Company also occasionally enters into certain foreign currency forward contracts to hedge certain exposures that are not designated as hedging instruments for accounting purposes. These contracts are recorded at fair value, with the changes in fair value recognized in the Consolidated Statements of Operations.

The Company does not hold or use derivative financial instruments for trading or speculative purposes.

The Company is exposed to credit loss in the event of nonperformance by the counterparties to these financial instruments, however, nonperformance is not anticipated.

The following table summarizes the fair value of the Company's derivatives included on the Consolidated Balance Sheets (in thousands) as of:

	September 27, 2014			September 28, 2013			Balance Sheet Classification
Derivatives designated as hedges:
Interest rate swaps	$	(3,371	)	$	(6,004	)	Other current liabilities
Coffee futures		3,437			—		Other current assets
Coffee futures		—			(3,809	)	Other current liabilities
Foreign currency forward contracts		—			(141	)	Other current liabilities
Foreign currency forward contracts		108			13		Other current assets
		174			(9,941	)
Derivatives not designated as hedges:
Cross currency swap		5,951			—		Other current assets
Cross currency swap		—			(1,253	)	Other current liabilities
		5,951			(1,253	)
Total	$	6,125		$	(11,194	)

Offsetting

Generally, all of the Company's derivative instruments are subject to a master netting arrangement under which either party may offset amounts if the payment amounts are for the same transaction and in the same currency. By election, parties may agree to net other transactions. In addition, the arrangements provide for the net settlement of all contracts through a single payment in a single currency in the event of default or termination of the contract. The Company's policy is to net all derivative assets and liabilities in the accompanying audited Consolidated Balance Sheets when allowable by GAAP.

Additionally, the Company has elected to include all derivative assets and liabilities, including those not subject to a master netting arrangement, in the following offsetting tables.

Offsetting of financial assets and derivative assets as of September 27, 2014 and September 28, 2013 is as follows (in thousands):

						Net amount of assets presented in the Consolidated Balance Sheet
			Gross amounts offset in the Consolidated Balance Sheet					Gross amounts not offset in the Consolidated Balance Sheet
	Gross amounts of recognized assets
								Financial instruments		Cash collateral received		Net amount
Derivative assets, as of September 27, 2014	$	9,830	$	(334	)	$	9,496	$	—	$	—	$	9,496
Derivative assets, as of September 28, 2013		13		—			13		—		—		13

Offsetting of financial liabilities and derivative liabilities as of September 27, 2014 and September 28, 2013 is as follows (in thousands):

						Net amount of assets presented in the Consolidated Balance Sheet
			Gross amounts offset in the Consolidated Balance Sheet					Gross amounts not offset in the Consolidated Balance Sheet
	Gross amounts of recognized assets
								Financial instruments		Cash collateral received		Net amount
Derivative liabilities, as of September 27, 2014	$	3,705	$	(334	)	$	3,371	$	—	$	—	$	3,371
Derivative liabilities, as of September 28, 2013		11,207		—			11,207		—		—		11,207

The following table summarizes the coffee futures contracts outstanding as of September 27, 2014 (in thousands, except for average contract price and "C" price):

Coffee Pounds		Average Contract Price		"C" Price		Maturity		Fair Value of Futures Contracts
	900	$	1.27	$	1.94		July 2015	$	602
	4,725	$	1.27	$	1.94		July 2015		3,169
	938	$	2.13	$	1.94		July 2015		(174	)
	937	$	2.12	$	1.95		September 2015		(160	)
	7,500							$	3,437

The following table summarizes the coffee futures contracts outstanding as of September 28, 2013 (in thousands, except for average contract price and "C" price):

Coffee Pounds		Average Contract Price		"C" Price		Maturity		Fair Value of Futures Contracts
	375	$	1.50	$	1.14		December 2013	$	(138	)
	5,887	$	1.39	$	1.17		March 2014		(1,308	)
	11,438	$	1.30	$	1.19		May 2014		(1,222	)
	10,875	$	1.32	$	1.21		July 2014		(1,141	)
	28,575							$	(3,809	)

The following table summarizes the amount of gain (loss), gross of tax, arising during the period on financial instruments that qualify for hedge accounting included in OCI (in thousands):

	Fiscal 2014		Fiscal 2013			Fiscal 2012
Cash Flow Hedges:
Interest rate swaps	$	2,634	$	3,014		$	1,250
Coffee futures		17,824		(6,617	)		(2,484	)
Foreign currency forward contracts		183		(129	)		—
Total	$	20,641	$	(3,732	)	$	(1,234	)

The following table summarizes the amount of gain (loss), gross of tax, reclassified from OCI to income (in thousands):

	Fiscal 2014			Fiscal 2013			Fiscal 2012			Location of Gain or (Loss) Reclassified from OCI into Income
Coffee futures		(6,387	)		(1,482	)		(1,359	)	Cost of sales
Foreign currency forward contracts		74			—			—		Cost of sales
Foreign currency forward contracts		(2	)		(2	)		—		(Loss) gain on foreign currency, net
Total	$	(6,315	)	$	(1,484	)	$	(1,359	)

The Company expects to reclassify $9.4 million of net gains, net of tax, from OCI to earnings on coffee derivatives within the next twelve months.

See note 14, Stockholders' Equity for a reconciliation of derivatives in beginning accumulated other comprehensive income (loss) to derivatives in ending accumulated other comprehensive income (loss).

The following table summarizes the amount of gain (loss), gross of tax, on fair value hedges and related hedged items (in thousands):

	Fiscal 2014		Fiscal 2013			Fiscal 2012			Location of gain (loss) recognized in income on derivative
Foreign currency forward contracts
Net loss on hedging derivatives	$	—	$	(10	)	$	(48	)	(Loss) gain on foreign currency, net
Net gain on hedged items	$	—	$	10		$	48		(Loss) gain on foreign currency, net

Net gains (losses) on financial instruments not designated as hedges for accounting purposes are as follows (in thousands):

	Fiscal 2014		Fiscal 2013		Fiscal 2012			Location of net gain (loss) in Consolidated Statements of Operations
Net gain (loss) on cross currency swap	$	8,307	$	5,513	$	(4,918	)	Gain (loss) on financial instruments, net
Net gain on coffee futures		7,005		—		—		Cost of sales
Net loss on interest rate cap		—		—		(34	)	Gain (loss) on financial instruments, net
Net gain on coffee futures		—		—		7		Gain (loss) on financial instruments, net
Total	$	15,312	$	5,513	$	(4,945	)

In addition, for fiscal year 2014, the Company recognized $1.7 million in net gains, as cost of sales, representing the ineffective portion on coffee futures designated as cash flow hedges. No amounts were recognized in fiscal 2013 and 2012 for ineffectiveness.

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Income Taxes (Details 6)	3 Months Ended	12 Months Ended
	Sep. 28, 2013 USD ($)	Sep. 27, 2014 USD ($)	Sep. 28, 2013 USD ($)	Sep. 29, 2012 USD ($)	Sep. 27, 2014 CAD
Income Taxes
Unrecognized tax benefits that would impact effective tax rate		$ 14,800,000
Indemnification receivable associated with unrecognized tax benefits		9,200,000
Maximum amount of unrecognized tax benefit indemnification					30,000,000
Accrued interest and penalties	2,000,000	2,400,000	2,000,000
Interest and penalties included in income tax expense		400,000	400,000	200,000
Gross tax contingencies, beginning balance		23,283,000	23,956,000	24,419,000
Increases from positions taken during prior periods			438,000	2,864,000
Decreases from positions taken during prior periods				(4,093,000)
Increases from positions taken during current periods		504,000	2,709,000	906,000
Decreases resulting from the lapse of the applicable statute of limitations	(200,000)	(8,948,000)	(3,820,000)	(140,000)
Gross tax contingencies, ending balance	23,283,000	14,839,000	23,283,000	23,956,000
Unrecognized tax benefits expected to be released during fiscal year 2015 due to expiration of statute of limitations		5,000,000
Undistributed international earnings		200,900,000
Deferred taxes provided on undistributed international earnings		$ 0

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Employee Retirement Plans (Details) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Sep. 27, 2014 item	Sep. 28, 2013	Sep. 29, 2012
United States 401(k) Plan [Member]
Defined Contribution Plan Disclosure [Line Items]
Minimum age of eligible employees	18 years
Minimum hours per week to be eligible for participation in the plan	36
Percentage match of employee contributions	50.00%
Percent of maximum annual contribution per employee	6.00%
Contributions to 401(k) plan	$ 6.4	$ 5.2	$ 4.4
Canadian Group Registered Retirement Savings Plans and Deferred Profit Sharing Plan [Member]
Defined Contribution Plan Disclosure [Line Items]
Contributions to Canadian plans	$ 1.5	$ 1.4	$ 1.0

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Consolidated Statements of Operations (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Consolidated Statements of Operations
Net sales	$ 4,707,680	$ 4,358,100	$ 3,859,198
Cost of sales	2,891,820	2,738,714	2,589,799
Gross profit	1,815,860	1,619,386	1,269,399
Selling and operating expenses	561,573	560,430	481,493
General and administrative expenses	307,046	293,729	219,010
Operating income	947,241	765,227	568,896
Other income, net	262	960	1,819
Gain (loss) on financial instruments, net	8,307	5,513	(4,945)
(Loss) gain on foreign currency, net	(19,746)	(12,649)	7,043
Gain on sale of subsidiary			26,311
Interest expense	(11,691)	(18,177)	(22,983)
Income before income taxes	924,373	740,874	576,141
Income tax expense	(326,959)	(256,771)	(212,641)
Net income	597,414	484,103	363,500
Net income attributable to noncontrolling interests	896	871	872
Net income attributable to Keurig	$ 596,518	$ 483,232	$ 362,628
Net income attributable to Keurig per common share:
Basic (in dollars per share)	$ 3.80	$ 3.23	$ 2.34
Diluted (in dollars per share)	$ 3.74	$ 3.16	$ 2.28
Cash dividends declared per common share (in dollars per share)	$ 1.00
Weighted-average common shares outstanding:
Basic (in shares)	157,085,574	149,638,636	154,933,948
Diluted weighted average common shares outstanding (in shares)	159,568,342	152,801,493	159,075,646

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Inventories

12 Months Ended

Sep. 27, 2014

Inventories

Inventories

5.     Inventories

Inventories consisted of the following (in thousands) as of:

	September 27, 2014		September 28, 2013
Raw materials and supplies	$	169,858	$	182,882
Finished goods		665,309		493,207
	$	835,167	$	676,089

As of September 27, 2014, the Company had approximately $407.7 million in green coffee purchase commitments, of which approximately 88% had a fixed price. These commitments primarily extend through fiscal 2016. The value of the variable portion of these commitments was calculated using an average "C" price of coffee of $1.93 per pound at September 27, 2014. In addition to its green coffee commitments, the Company had approximately $256.4 million in fixed price brewer and related accessory purchase commitments and $1,108.7 million in production raw materials commitments at September 27, 2014. The Company believes, based on relationships established with its suppliers, that the risk of non-delivery on such purchase commitments is remote.

As of September 27, 2014, minimum future inventory purchase commitments were as follows (in thousands):

Fiscal Year	Inventory Purchase Obligations(1)
2015		830,788
2016		252,623
2017		250,779
2018		263,039
2019		65,762
Thereafter		109,805
	$	1,772,796

(1) Certain purchase obligations are determined based on a contractual percentage of forecasted volumes.

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Segment Reporting

12 Months Ended

Sep. 27, 2014

Segment Reporting

Segment Reporting

4.     Segment Reporting

Segment information is prepared on the same basis that our CEO, who is our chief operating decision maker, manages the business, evaluates financial results, and makes key operating decisions. The structure includes a Domestic segment containing all U.S. Operations and immaterial operations related to international expansion, and a Canada segment containing all Canadian operations.

For a description of the operating segments, see Note 1, Nature of Business and Organization.  

Management evaluates the performance of the Company's operating segments based on several factors, including net sales to external customers and operating income. Net sales are recorded on a segment basis and intersegment sales are eliminated within the operating segment as part of the financial consolidation process. Operating income represents gross profit less selling, operating, general and administrative expenses. The Company's manufacturing operations occur within both the Domestic and Canada segments, and the costs of manufacturing are recognized in cost of sales in the operating segment in which the sale occurs. Information system technology services are mainly centralized while finance and accounting functions are primarily decentralized. Expenses consisting primarily of compensation and depreciation related to certain centralized administrative functions including information system technology are allocated to the operating segments.

Expenses not specifically related to an operating segment are presented under "Corporate Unallocated." Corporate Unallocated expenses are comprised mainly of the compensation and other related expenses of certain of the Company's senior executive officers and other selected employees who perform duties related to the entire enterprise. Corporate Unallocated expenses also include depreciation for corporate headquarters, sustainability expenses, interest expense not directly attributable to an operating segment, the majority of foreign exchange gains or losses, legal expenses and compensation of the Board of Directors. The Company does not disclose assets or property additions by segment as only consolidated asset information is provided to the CODM for use in decision making.

The following tables summarize selected financial data for segment disclosures for fiscal 2014, 2013 and 2012.

	For Fiscal 2014 (Dollars in thousands)
	Domestic		Canada		Corporate- Unallocated			Consolidated
Net sales	$	4,083,326	$	624,354	$	—		$	4,707,680
Operating income (loss)	$	1,016,577	$	102,605	$	(171,941	)	$	947,241
Depreciation and amortization	$	185,874	$	61,989	$	9,776		$	257,639
Stock compensation expense	$	14,071	$	2,729	$	13,873		$	30,673

	For Fiscal 2013 (Dollars in thousands)
	Domestic		Canada		Corporate- Unallocated			Consolidated
Net sales	$	3,725,008	$	633,092	$	—		$	4,358,100
Operating Income (loss)	$	826,092	$	87,674	$	(148,539	)	$	765,227
Depreciation and amortization	$	162,359	$	65,334	$	1,500		$	229,193
Stock compensation expense	$	9,909	$	2,519	$	13,653		$	26,081

	For Fiscal 2012 (Dollars in thousands)
	Domestic		Canada		Corporate- Unallocated			Consolidated
Net sales	$	3,233,674	$	625,524	$	—		$	3,859,198
Operating Income (loss)	$	576,949	$	76,198	$	(84,251	)	$	568,896
Depreciation and amortization	$	116,722	$	62,984	$	1,941		$	181,647
Stock compensation expense	$	7,808	$	1,890	$	8,170		$	17,868

Geographic Information

Net sales are attributed to countries based on the location of the customer. Information concerning net sales of principal geographic areas is as follows (in thousands):

	Fiscal 2014		Fiscal 2013		Fiscal 2012
Net Sales:
United States	$	4,074,968	$	3,721,182	$	3,248,543
Canada		621,460		634,360		609,828
Other		11,252		2,558		827
	$	4,707,680	$	4,358,100	$	3,859,198

Sales to customers that represented more than 10% of the Company's net sales included Wal-Mart, representing approximately 17%, 14% and 12% of consolidated net sales for fiscal years 2014, 2013 and 2012, respectively, and Costco, representing approximately 12% and 11% of consolidated net sales for fiscal 2014 and 2013, respectively. Sales to Wal-Mart and Costco in fiscal years 2014, 2013 and 2012 were through both the Domestic and Canada segments.

Information concerning long-lived assets of principal geographic area is as follows (in thousands) as of:

	September 27, 2014		September 28, 2013
Fixed Assets, net:
United States	$	1,010,181	$	844,471
Canada		125,155		135,440
Other		36,089		5,652
	$	1,171,425	$	985,563

Net Sales by Major Product Category

Net sales by major product category (in thousands):

	Fiscal 2014		Fiscal 2013		Fiscal 2012
Portion Packs	$	3,604,539	$	3,187,350	$	2,708,886
Brewers and Accessories		822,271		827,570		759,805
Other Products and Royalties		280,870		343,180		390,507
	$	4,707,680	$	4,358,100	$	3,859,198

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Employee Retirement Plans

12 Months Ended

Sep. 27, 2014

Employee Retirement Plans

Employee Retirement Plans

16.   Employee Retirement Plans

Defined Contribution Plans

The Company has a defined contribution plan which meets the requirements of section 401(k) of the Internal Revenue Code. All regular full-time U.S. employees of the Company who are at least eighteen years of age and work a minimum of 36 hours per week are eligible to participate in the plan. The plan allows employees to defer a portion of their salary on a pre-tax basis and the Company contributes 50% of amounts contributed by employees up to 6% of their salary. Company contributions to the plan were $6.4 million, $5.2 million, and $4.4 million, for fiscal years 2014, 2013, and 2012, respectively.

In conjunction with the Van Houtte acquisition, the Company also has several Canadian Group Registered Retirement Savings Plans ("GRRSP") and a Deferred Profit Sharing Plan ("DPSP"). Under these plans, employees can contribute a certain percentage of their salary and the Company can also make annual contributions to the plans. Company contributions to the Canadian plans were $1.5 million, $1.4 million and $1.0 million for fiscal years 2014, 2013, and 2012, respectively.

Defined Benefit Plans

The Company has a supplementary defined benefit retirement plan and a supplementary employee retirement plan (collectively the "Plans") for certain management employees in the Canada segment. The cost of the Plans is calculated according to actuarial methods that encompass management's best estimate regarding the future evolution of salary levels, the age of retirement of salaried employees and other actuarial factors. These Plans are not funded and there are no plan assets. Future benefits will be paid from the funds of the Company.

For each of the years ended September 27, 2014 and September 28, 2013, the projected benefit obligation was $1.4 million and is classified in other long-term liabilities. Net periodic pension expense (income) was $0.2 million, $0.3 million and $(0.1) million for fiscal years 2014, 2013, and 2012, respectively.

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Fair Value Measurements

12 Months Ended

Sep. 27, 2014

Fair Value Measurements

Fair Value Measurements

12.   Fair Value Measurements

The Company measures fair value as the selling price that would be received for an asset, or paid to transfer a liability, in the principal or most advantageous market on the measurement date. The hierarchy established by the Financial Accounting Standards Board prioritizes fair value measurements based on the types of inputs used in the valuation technique. The inputs are categorized into the following levels:

Level 1 — Observable inputs such as quoted prices in active markets for identical assets or liabilities.

Level 2 — Inputs other than quoted prices that are observable, either directly or indirectly, which include quoted prices for similar assets or liabilities in active markets and quoted prices for identical assets or liabilities in markets that are not active.

Level 3 — Unobservable inputs not corroborated by market data, therefore requiring the entity to use the best available information, including management assumptions.

The following table summarizes the fair values and the levels used in fair value measurements as of September 27, 2014 for the Company's financial (liabilities) assets (in thousands):

	Fair Value Measurements Using
	Level 1		Level 2			Level 3
Derivatives:
Interest rate swaps	$	—	$	(3,371	)	$	—
Cross currency swap		—		5,951			—
Coffee futures		—		3,437			—
Foreign currency forward contracts		—		108			—
Total	$	—	$	6,125		$	—

The following table summarizes the fair values and the levels used in fair value measurements as of September 28, 2013 for the Company's financial liabilities (in thousands):

	Fair Value Measurements Using
	Level 1		Level 2			Level 3
Derivatives:
Interest rate swaps	$	—	$	(6,004	)	$	—
Cross currency swap		—		(1,253	)		—
Coffee futures		—		(3,809	)		—
Foreign currency forward contracts		—		(128	)		—
Total	$	—	$	(11,194	)	$	—

Level 2 derivative financial instruments use inputs that are based on market data of identical (or similar) instruments, including forward prices for commodities, interest rates curves and spot prices that are in observable markets. Derivatives recorded on the balance sheet are at fair value with changes in fair value recorded in OCI for cash flow hedges and in the Consolidated Statements of Operations for fair value hedges and derivatives that do not qualify for hedge accounting treatment.

Derivatives

Derivative financial instruments include coffee futures contracts, interest rate swap agreements, a cross-currency swap agreement and foreign currency forward contracts. The Company has identified significant concentrations of credit risk based on the economic characteristics of the instruments that include interest rates, commodity indexes and foreign currency rates and selectively enters into the derivative instruments with counterparties using credit ratings.

To determine fair value, the Company utilizes the market approach valuation technique for coffee futures and foreign currency forward contracts and the income approach for interest rate and cross currency swap agreements. The Company's fair value measurements include a credit valuation adjustment for the significant concentrations of credit risk.

As of September 27, 2014, the amount of loss estimated by the Company due to credit risk associated with the derivatives for all significant concentrations was not material based on the factors of an industry recovery rate and a calculated probability of default.

Long-Term Debt

The carrying value of long-term debt was $160.0 million and $173.2 million as of September 27, 2014 and September 28, 2013, respectively. The inputs to the calculation of the fair value of long-term debt are considered to be Level 2 within the fair value

hierarchy, as the measurement of fair value is based on the net present value of calculated interest and principal payments, using an interest rate derived from a fair market yield curve adjusted for the Company's credit rating. The carrying value of long-term debt approximates fair value as the interest rate on the debt is based on variable interest rates that reset every 30 days.

Long-Term Investment

The Company has a long-term investment of approximately $35.9 million included in other long-term assets in the accompanying audited Consolidated Balance Sheet as of September 27, 2014, that is not publicly traded. This investment is carried at cost and reviewed quarterly for indicators of other-than-temporary impairment. There were no events or circumstances during the fiscal year ended September 27, 2014 that indicated a decline in the fair value of the investment

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Employee Compensation Plans (Details)			12 Months Ended						12 Months Ended
	Sep. 27, 2014 Employee Stock Option [Member] item person	Sep. 28, 2013 Employee Stock Option [Member]	Sep. 27, 2014 Incentive Plan 2014 [Member]	Sep. 27, 2014 Incentive Plans 2014 and 2006 [Member] Minimum [Member]	Sep. 27, 2014 Incentive Plans 2014 and 2006 [Member] Employee Stock Option [Member]	Sep. 27, 2014 Incentive Plans 2014 and 2006 [Member] Employee Stock Option [Member] Minimum [Member]	Sep. 27, 2014 Incentive Plans 2014 and 2006 [Member] Employee Stock Option [Member] Maximum [Member]	Sep. 27, 2014 Two Thousand Five Plan [Member] Employee Stock Option [Member]	Sep. 27, 2014 Employee Stock [Member] period
Compensation Plans
Shares of common stock authorized for issuance under the plan			8,000,000
Ratio of Fungible Pool Units per award other than options or SARs			1.704
Ratio of Fungible Pool Units per stock option or stock appreciation right			1.0
Shares of common stock available for grant			7,300,000						2,045,520
Outstanding options for shares of common stock	3,436,727	5,022,340						39,251
Number of previous inducement grants with outstanding awards	2
Number of officers with options from previous inducement grants	2
Vesting period of award						3 years	5 years
Option price as a percentage of fair market value of the common stock, if grantee owns in excess of 10% of Company common stock					110.00%
Percentage of common stock to be owned to increase the option price at the date of grant						10.00%
Option price as a percentage of fair market value of the common stock				100.00%					85.00%
Number of withholding periods per fiscal year									2
Length of withholding periods									6 months

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Noncontrolling Interests

12 Months Ended

Sep. 27, 2014

Noncontrolling Interests

Noncontrolling Interests

8.     Noncontrolling Interests

The changes in the liability and temporary equity attributable to redeemable NCIs for the three fiscal years in the period ended September 27, 2014 are as follows (in thousands):

	Liability attributable to mandatorily redeemable noncontrolling interests			Equity attributable to redeemable noncontrolling interests
Balance at September 24, 2011	$	—		$	21,034
Disposition of noncontrolling interest		—			(10,331	)
Redeemable noncontrolling interest reclassified to other long-term liabilities		4,708			(4,708	)
Net income		60			812
Adjustment to redemption value		167			3,155
Cash distributions		(204	)		(513	)
Other comprehensive loss, net of tax		197			455
Balance at September 29, 2012	$	4,928		$	9,904
Net income		462			409
Adjustment to redemption value		372			2,025
Cash distributions		(583	)		(823	)
Other comprehensive loss, net of tax		(245	)		(470	)
Balance at September 28, 2013	$	4,934		$	11,045
Net income		344			552
Adjustment to redemption value		47			2,368
Cash distributions		(348	)		(651	)
Other comprehensive loss, net of tax		(225	)		(874	)
Purchase of noncontrolling interest		(4,752	)		—
Balance at September 27, 2014	$	—		$	12,440

Mandatorily Redeemable Noncontrolling Interest

On June 22, 2012, the Company executed a Share Purchase and Sale Agreement under which the Company was required to purchase a noncontrolling interest holder's shares in an entity in which the Company held a controlling interest within 30 days of the end of the Company's third quarter of fiscal 2014. The mandatorily redeemable noncontrolling interest was classified as a liability in the accompanying Consolidated Balance Sheet as of September 28, 2013 under the caption, Other current liabilities.

On August 22, 2014, the Company purchased the noncontrolling interest holder's shares for approximately $5.6 million, resulting in the subsidiary being wholly-owned by the Company. Of the $5.6 million purchase price, $0.8 million is in escrow and is contingently returnable to the Company upon final determination of fair value of the noncontrolling interest holder's shares. The contingent consideration is recorded in the accompanying Consolidated Balance Sheet as of September 27, 2014 under the caption, Other current assets, and any changes in the fair value of the contingent consideration will be recognized in earnings until resolved.

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Goodwill and Intangible Assets (Details 3) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Intangible assets subject to amortization
Gross carrying value	$ 451,914	$ 501,127
Accumulated amortization	(176,727)	(163,651)
Total amortization expense	43,032	45,379	45,991
Estimated useful life	7 years 4 months 24 days
Developed Technology Rights [Member]
Intangible assets subject to amortization
Gross carrying value	16,501	21,609
Accumulated amortization	(13,713)	(17,123)
Developed Technology Rights [Member] | Minimum [Member]
Intangible assets subject to amortization
Estimated useful life	4 years
Developed Technology Rights [Member] | Maximum [Member]
Intangible assets subject to amortization
Estimated useful life	10 years
Customer and Roaster Agreements [Member]
Intangible assets subject to amortization
Gross carrying value	8,939	26,977
Accumulated amortization	(5,303)	(19,750)
Customer and Roaster Agreements [Member] | Minimum [Member]
Intangible assets subject to amortization
Estimated useful life	8 years
Customer and Roaster Agreements [Member] | Maximum [Member]
Intangible assets subject to amortization
Estimated useful life	11 years
Customer Relationships [Member]
Intangible assets subject to amortization
Gross carrying value	390,563	414,967
Accumulated amortization	(141,163)	(113,061)
Customer Relationships [Member] | Minimum [Member]
Intangible assets subject to amortization
Estimated useful life	2 years
Customer Relationships [Member] | Maximum [Member]
Intangible assets subject to amortization
Estimated useful life	16 years
Trade Names [Member]
Intangible assets subject to amortization
Gross carrying value	35,911	37,200
Accumulated amortization	(16,548)	(13,353)
Trade Names [Member] | Minimum [Member]
Intangible assets subject to amortization
Estimated useful life	9 years
Trade Names [Member] | Maximum [Member]
Intangible assets subject to amortization
Estimated useful life	11 years
Noncompete Agreements [Member]
Intangible assets subject to amortization
Gross carrying value		374
Accumulated amortization		$ (364)
Noncompete Agreements [Member] | Minimum [Member]
Intangible assets subject to amortization
Estimated useful life	2 years
Noncompete Agreements [Member] | Maximum [Member]
Intangible assets subject to amortization
Estimated useful life	5 years

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Fixed Assets

12 Months Ended

Sep. 27, 2014

Fixed Assets

Fixed Assets

6.     Fixed Assets

Fixed assets consisted of the following (in thousands) as of:

	Useful Life in Years		September 27, 2014			September 28, 2013
Production equipment		1-15	$	779,850		$	680,457
Coffee service equipment		3-7		61,029			59,169
Computer equipment and software		1-6		177,878			146,246
Land		Indefinite		12,767			11,520
Building and building improvements		4-30		238,945			134,495
Furniture and fixtures		1-15		36,899			33,975
Vehicles		4-5		13,032			11,786
Leasehold improvements		1-20 or remaining life of lease, whichever is less		95,373			98,990
Assets acquired under capital leases		5-15		41,200			41,200
Construction-in-progress				308,976			202,940
Total fixed assets			$	1,765,949		$	1,420,778
Accumulated depreciation				(594,524	)		(435,215	)
			$	1,171,425		$	985,563

Assets acquired under capital leases, net of accumulated amortization, were $34.1 million and $36.9 million at September 27, 2014 and September 28, 2013, respectively.

Total depreciation and amortization expense relating to all fixed assets was $214.6 million, $183.8 million and $135.7 million for fiscal years 2014, 2013, and 2012, respectively.

Assets classified as construction-in-progress are not depreciated, as they are not ready for productive use.

During fiscal years 2014, 2013 and 2012, $8.0 million, $6.1 million, and $2.8 million, respectively, of interest expense was capitalized.

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Goodwill and Intangible Assets

12 Months Ended

Sep. 27, 2014

Goodwill and Intangible Assets

Goodwill and Intangible Assets

7.     Goodwill and Intangible Assets

The following represented the change in the carrying amount of goodwill by segment for fiscal 2014 and 2013 (in thousands):

	Domestic		Canada			Total
Balance as of September 29, 2012	$	369,353	$	438,723		$	808,076
Foreign currency effect		—		(19,892	)		(19,892	)
Balance as of September 28, 2013	$	369,353	$	418,831		$	788,184
Other	$	—	$	(233	)	$	(233	)
Foreign currency effect	$	—	$	(32,056	)	$	(32,056	)
Balance as of September 27, 2014	$	369,353	$	386,542		$	755,895

Indefinite-lived intangible assets included in the Canada operating segment consisted of the following (in thousands) as of:

	September 27, 2014		September 28, 2013
Trade names	$	90,257	$	97,740

The Company conducted its annual impairment test of goodwill and indefinite-lived intangible assets as of September 27, 2014, and elected to bypass the optional qualitative assessment and performed a quantitative impairment test. Goodwill was evaluated for impairment at the following reporting unit levels:

• Domestic

• Canada—Roasting and Retail

• Canada—Coffee Services Canada

For the goodwill impairment test, the fair value of the reporting units was estimated using the Discounted Cash Flow ("DCF") method. A number of significant assumptions and estimates are involved in the application of the DCF method including discount rate, sales volume and prices, costs to produce and working capital changes. For the indefinite-lived intangible assets impairment test, the fair value of the trade name was estimated using the Relief-from-Royalty Method. This method estimates the savings in royalties the Company would otherwise have had to pay if it did not own the trade name and had to license the trade name from a third-party with rights of use substantially equivalent to ownership. The fair value of the trade name is the present value of the future estimated after-tax royalty payments avoided by ownership, discounted at an appropriate, risk-adjusted rate of return. For goodwill and indefinite-lived intangible impairment tests, the Company used a royalty rate of 3.0%, an income tax rate of 38.0% for the United States and 27.5% for Canada, and discount rates ranging from 13% to 14%. There was no material impairment of goodwill or indefinite-lived intangible assets in fiscal years 2014, 2013, or 2012.

Intangible Assets Subject to Amortization

Definite-lived intangible assets consisted of the following (in thousands) as of:

			September 27, 2014					September 28, 2013
	Useful Life in Years		Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Acquired technology		4-10	$	16,501	$	(13,713	)	$	21,609	$	(17,123	)
Customer and roaster agreements		8-11		8,939		(5,303	)		26,977		(19,750	)
Customer relationships		2-16		390,563		(141,163	)		414,967		(113,061	)
Trade names		9-11		35,911		(16,548	)		37,200		(13,353	)
Non-compete agreements		2-5		—		—			374		(364	)
Total			$	451,914	$	(176,727	)	$	501,127	$	(163,651	)

Definite-lived intangible assets are amortized on a straight-line basis over the period of expected economic benefit. Total amortization expense was $43.0 million, $45.4 million, and $46.0 million for fiscal years 2014, 2013, and 2012, respectively. The weighted average remaining life for definite-lived intangibles at September 27, 2014 is 7.4 years.

The estimated aggregate amortization expense over each of the next five years and thereafter, is as follows (in thousands):

2015	40,452
2016	39,727
2017	38,331
2018	38,331
2019	38,231
Thereafter	80,115

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Product Warranties

12 Months Ended

Sep. 27, 2014

Product Warranties

Product Warranties

9.     Product Warranties

The Company offers a one-year warranty on all Keurig® brewers it sells. The Company provides for the estimated cost of product warranties, primarily using historical information and current repair or replacement costs, at the time product revenue is recognized. Brewer failures may arise in the later part of the warranty period, and actual warranty costs may exceed the reserve. As the Company has grown, it has added significantly to its product testing, quality control infrastructure and overall quality processes. Nevertheless, as the Company continues to innovate, and its products become more complex, both in design and componentry, product performance may tend to modulate, causing warranty rates to possibly fluctuate going forward. As a result, future warranty claims rates may be higher or lower than the Company is currently experiencing and for which the Company is currently providing in its warranty reserve.

The changes in the carrying amount of product warranties for fiscal years 2014 and 2013 are as follows (in thousands):

	Fiscal 2014			Fiscal 2013
Balance, beginning of year	$	7,804		$	20,218
Provision related to current period		27,484			20,447
Change in estimate		(1,485	)		(12,720	)
Usage		(20,953	)		(20,141	)
Balance, end of year	$	12,850		$	7,804

During fiscal years 2014 and 2013, the Company recovered approximately $1.8 million and $0.8 million respectively, as reimbursement from suppliers related to warranty issues. The recoveries are under an agreement with a supplier and are recorded as a reduction to warranty expense. The recoveries are not reflected in the provision charged to income in the table above.

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Long-Term Debt (Details) (USD $) In Thousands, unless otherwise specified	Sep. 27, 2014	Sep. 28, 2013
Long-term debt
Total long-term debt	$ 160,014	$ 173,150
Less current portion	19,077	12,929
Long-term debt	140,937	160,221
Restated Credit Agreement [Member] | Loans Payable [Member]
Long-term debt
Total long-term debt	158,438	170,937
Other Long Term Debt [Member]
Long-term debt
Total long-term debt	$ 1,576	$ 2,213

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Employee Compensation Plans (Details 2) (USD $)	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Number of shares
Number of Shares, Exercisable	2,541,149
Weighted Average Exercise Price (per share)
Weighted Average Exercise Price, Exercisable	$ 13.68
Summary of stock options
Stock options vested and expected to vest, Number of options outstanding	3,428,994
Stock options vested and expected to vest, Weighted average remaining contractual life	4 years 7 months 28 days
Stock options vested and expected to vest, Weighted average exercise price	$ 25.15
Stock options vested and expected to vest, Intrinsic value	$ 361,691,000
Stock options exercisable, Weighted average remaining contractual life	3 years 4 months 24 days
Stock options exercisable, Intrinsic value	297,200,000
Employee Stock Option [Member]
Number of shares
Number of shares, outstanding, beginning balance	5,022,340
Number of Shares, Granted	386,309
Number of Shares, Exercised	(1,872,448)
Number of Shares, Forfeited/expired	(99,474)
Number of Shares, Outstanding, ending balance	3,436,727	5,022,340
Number of Shares, Exercisable	2,541,149
Weighted Average Exercise Price (per share)
Weighted Average Exercise Price, Outstanding, beginning balance	$ 18.30
Weighted Average Exercise Price, Granted	$ 73.53
Weighted Average Exercise Price, Exercised	$ 15.02
Weighted Average Exercise Price, Forfeited/expired	$ 54.56
Weighted average exercise price, outstanding, ending balance	$ 25.24	$ 18.30
Weighted Average Exercise Price, Exercisable	$ 13.68
Summary of stock options
Intrinsic values of options exercised	$ 167,000,000	$ 165,500,000	$ 46,600,000

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Long-Term Debt (Details 3) (Interest Rate Swap [Member], USD $)	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Mitigating interest rate exposure of variable-rate borrowings
Notional Amount of Underlying Debt	$ 130,000,000
Interest expense, long-term debt	3,200,000	3,400,000	4,700,000
London Interbank Offered Rate (LIBOR) [Member]
Mitigating interest rate exposure of variable-rate borrowings
Hedged Transaction - Period for variable rate basis	30 days
Interest Rate Swap Maturity Two Thousand Sixteen [Member]
Mitigating interest rate exposure of variable-rate borrowings
Hedged Transaction - Period for variable rate basis	30 days
Notional Amount of Underlying Debt	30,000,000
Fixed rate received (as a percent)	2.54%
Interest Rate Swap Maturity Two Thousand Sixteen B [Member]
Mitigating interest rate exposure of variable-rate borrowings
Hedged Transaction - Period for variable rate basis	30 days
Notional Amount of Underlying Debt	50,000,000
Fixed rate received (as a percent)	2.54%
Interest Rate Swap Maturity Two Thousand Sixteen C [Member]
Mitigating interest rate exposure of variable-rate borrowings
Hedged Transaction - Period for variable rate basis	30 days
Notional Amount of Underlying Debt	20,000,000
Fixed rate received (as a percent)	2.54%
Interest Rate Swap Maturity Two Thousand Sixteen D [Member]
Mitigating interest rate exposure of variable-rate borrowings
Hedged Transaction - Period for variable rate basis	30 days
Notional Amount of Underlying Debt	$ 30,000,000
Fixed rate received (as a percent)	2.54%

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Product Warranties (Details) (USD $)	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013
Product Warranties
Period of warranty on Keurig single-cup brewers	1 year
Changes in carrying amount of product warranties
Balance, beginning of year	$ 7,804,000	$ 20,218,000
Provision related to current period	27,484,000	20,447,000
Change in estimate	(1,485,000)	(12,720,000)
Usage	(20,953,000)	(20,141,000)
Balance, end of Period	12,850,000	7,804,000
Recoveries	$ 1,800,000	$ 800,000

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Deferred Compensation Plan (Details) (Deferred Compensation Plan [Member])	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013
Deferred Compensation Plan [Member]
Deferred Compensation Plan
Common stock available for future issuance, shares	351,276	353,434
Issuance of common stock under deferred compensation plan (in shares)	130
Common stock rights outstanding under plan, shares	2,158
Common stock committed under plan, shares	61,589	59,561

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Inventories (Tables)

12 Months Ended

Sep. 27, 2014

Inventories

Schedule of inventories

Inventories consisted of the following (in thousands) as of:

	September 27, 2014		September 28, 2013
Raw materials and supplies	$	169,858	$	182,882
Finished goods		665,309		493,207
	$	835,167	$	676,089

Schedule of minimum future inventory purchase commitments

As of September 27, 2014, minimum future inventory purchase commitments were as follows (in thousands):

Fiscal Year	Inventory Purchase Obligations(1)
2015		830,788
2016		252,623
2017		250,779
2018		263,039
2019		65,762
Thereafter		109,805
	$	1,772,796

(1) Certain purchase obligations are determined based on a contractual percentage of forecasted volumes.

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Significant Accounting Policies (Details 2) (USD $)	3 Months Ended												12 Months Ended
	Sep. 27, 2014	Jun. 28, 2014	Mar. 29, 2014	Dec. 28, 2013	Sep. 28, 2013	Jun. 29, 2013	Mar. 30, 2013	Dec. 29, 2012	Sep. 29, 2012	Jun. 23, 2012	Mar. 24, 2012	Dec. 24, 2011	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Significant Customer Credit Risk and Supply Risk
Sales processed	$ 1,195,567,000	$ 1,022,371,000	$ 1,103,072,000	$ 1,386,670,000	$ 1,047,177,000	$ 967,072,000	$ 1,004,792,000	$ 1,339,059,000	$ 946,736,000	$ 869,194,000	$ 885,052,000	$ 1,158,216,000	$ 4,707,680,000	$ 4,358,100,000	$ 3,859,198,000
Accounts receivable of major customers	621,451,000				467,976,000								621,451,000	467,976,000
Supplier Concentration Risk [Member] | Cost of Goods, Total [Member] | Purchased Brewers [Member]
Significant Customer Credit Risk and Supply Risk
Number of major suppliers													1	1	1
Purchases from brewer manufacturer													735,200,000	637,000,000	721,300,000
Credit Concentration Risk [Member] | Accounts Receivable [Member] | Costco Wholesale Corporation [Member]
Significant Customer Credit Risk and Supply Risk
Accounts receivable of major customers	104,500,000				65,700,000								104,500,000	65,700,000
Credit Concentration Risk [Member] | Accounts Receivable [Member] | Mblock [Member]
Significant Customer Credit Risk and Supply Risk
Sales processed													1,706,100,000	1,600,200,000	1,458,400,000
Accounts receivable of major customers	$ 148,200,000				$ 157,400,000								$ 148,200,000	$ 157,400,000
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Wal Mart Stores Inc and Affiliates [Member]
Significant Customer Credit Risk and Supply Risk
Percentage of net sales													17.00%	14.00%	12.00%
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Costco Wholesale Corporation [Member]
Significant Customer Credit Risk and Supply Risk
Percentage of net sales													12.00%	11.00%

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Stockholders' Equity

12 Months Ended

Sep. 27, 2014

Stockholders' Equity

Stockholders' Equity

14.   Stockholders' Equity

Stock Issuances

On February 27, 2014, pursuant to a common stock purchase agreement dated February 5, 2014, the Company sold 16,684,139 shares of its common stock to Atlantic Industries, an indirect wholly owned subsidiary of The Coca-Cola Company, at $74.98 per share for an aggregate purchase price of $1,251.0 million. In addition, on April 17, 2014, pursuant to a common stock purchase agreement dated March 28, 2014 and the pre-emptive rights of Luigi Lavazza S.p.A. ("Lavazza") set forth in the common stock purchase agreement (the "CSPA") between the Company and Lavazza dated August 10, 2010, the Company sold 1,407,000 shares of its common stock to Lavazza at $74.98 per share for an aggregate purchase price of $105.5 million. Pursuant to the CSPA, in connection with the offering of common stock to Atlantic Industries, Lavazza is entitled to maintain its current percentage ownership of the Company's outstanding common stock on terms (including price) not less favorable than those proposed for the Atlantic Industries offering. Both common stock sales were recorded to stockholders' equity, net of transaction-related expenses of approximately $8.0 million.

Stock Repurchase Program

Under its existing repurchase programs, on February 28, 2014, the Company entered into an accelerated share repurchase ("ASR") agreement with a major financial institution ("Bank"). The ASR allows the Company to buy a large number of shares immediately at a purchase price determined by an average market price over a period of time. Under the ASR, the Company agreed to purchase $700.0 million of its common stock, in total, with an initial delivery to the Company of 4,340,508 shares ("Initial Shares") of the Company's common stock by the Bank. The Initial Shares represent the number of shares at the current market price equal to 70% of the total fixed purchase price of $700.0 million. The repurchased shares were retired and returned to an unissued status. The par value of the repurchased shares of $0.4 million was deducted from common stock and the excess repurchase price over the par value of $489.6 million was deducted from additional paid-in capital. The remainder of the total purchase price of $210.0 million reflects the value of the stock held by the Bank pending final settlement and, accordingly, was recorded as a reduction to additional paid-in capital. Final settlement of the ASR will occur no sooner than November 24, 2014 and no later than February 27, 2015 at the Bank's discretion. Upon settlement of the ASR, the total shares repurchased by the Company will be determined based on a share price equal to the daily volume weighted-average price ("VWAP") of the Company's common stock during the term of the ASR program, less a fixed per share discount amount. At settlement, the Bank will deliver additional shares to the Company in the event total shares are greater than the 4,340,508 shares initially delivered, and the Company will issue additional shares to the Bank in the event total shares are less than the shares initially delivered. The receipt or issuance of additional shares will result in a reclassification between additional paid-in

capital and common stock equal to the par value of the additional shares received or issued. The number of shares that may be required to be issued by the Company to the Bank is limited to 10.0 million shares under the ASR.

The Company reflected the unsettled portion of the ASR ($210.0 million) as a repurchase of common stock for purposes of calculating earnings per share and as a forward contract indexed to its own common stock. The forward contract met all of the applicable criteria for equity classification, and, therefore, was not accounted for as a derivative instrument.

As of September 27, 2014, based on the VWAP of the Company's common stock for the period February 28, 2014 through September 27, 2014, settlement of the ASR would have resulted in 1.9 million additional shares delivered by the Bank to the Company.

An aggregate amount of $1,182.8 million remained authorized for common stock repurchase as of September 27, 2014.

	Fiscal 2014(1)		Fiscal 2013
Number of shares acquired		8,138,592		5,642,793
Average price per share of acquired shares	$	103.51	$	33.37
Total cost of acquired shares (in thousands)	$	1,052,430	$	188,278

(1) Number of shares acquired and average price per share reflect Initial Shares at then current market price, subject to change pending final settlement, and total cost of acquired shares includes total purchase price of $700.0 million under the ASR.

Common Stock Dividends

Each quarter during fiscal 2014, the Company declared a quarterly dividend of $0.25 per common share, or $158.9 million in the aggregate. During the fiscal year ended September 27, 2014, the Company paid dividends of approximately $118.4 million.

On November 13, 2014, Keurig's Board of Directors declared the next quarterly cash dividend of $0.2875 per common share, an increase of 15 percent as compared to quarterly cash dividends in fiscal 2014, payable on February 12, 2015 to shareholders of record as of the close of business on January 13, 2015.

Accumulated Other Comprehensive Income (Loss)

The following table provides the changes in the components of accumulated other comprehensive income (loss), net of tax (in thousands):

	Cash Flow Hedges			Translation			Accumulated Other Comprehensive Income (Loss)
Balance at September 24, 2011		(5,866	)		(8,709	)		(14,575	)
Other comprehensive income during the period		74			24,701			24,775
Balance at September 29, 2012		(5,792	)		15,992			10,200
Other comprehensive loss during the period		(1,358	)		(28,027	)		(29,385	)
Balance at September 28, 2013		(7,150	)		(12,035	)		(19,185	)
Other comprehensive income during the period		16,093			(50,968	)		(34,875	)
Foreign currency exchange impact on cash flow hedges		9			—			9
Balance at September 27, 2014	$	8,952		$	(63,003	)	$	(54,051	)

The unfavorable translation adjustments change during fiscal 2014 and fiscal 2013 was primarily due to the weakening of the Canadian dollar against the U.S. dollar. The favorable translation adjustment change during fiscal year 2012 was primarily due to the strengthening of the Canadian against the U.S. dollar. See also Note 11, Derivative Financial Instruments

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Commitments and Contingencies

12 Months Ended

Sep. 27, 2014

Commitments and Contingencies

Commitments and Contingencies

19.   Commitments and Contingencies

Lease Commitments

The Company leases office and retail space, production, distribution and service facilities, and certain equipment under various non-cancellable operating leases, with terms ranging from one to twenty years. Property leases normally require payment of a minimum annual rental plus a pro-rata share of certain landlord operating expenses. Total rent expense, under all operating leases approximated $24.8 million, $23.1 million, and $25.1 million in fiscal years 2014, 2013, and 2012, respectively. The Company has subleases relating to certain of its operating leases. Sublease

income approximated $1.0 million, $1.1 million and $0.3 million for fiscal years 2014, 2013 and 2012, respectively.

In addition, the Company leases a manufacturing facility which is accounted for as a capital lease. The initial term of the lease is 15 years with six additional renewal terms of five years each at the Company's option. The lease requires payment of a minimum annual rental and the Company is responsible for property taxes, insurance and operating expenses.

In June 2012, the Company entered into an arrangement to lease approximately 425,000 square feet located in Burlington, Massachusetts; the building was completed in July 2014.

Due to the Company's involvement in the Burlington, Massachusetts construction project, including its obligations to fund certain costs of construction exceeding amounts incurred by the lessor, the Company was deemed to be the owner of the project, which includes a pre-existing structure on the site, even though the Company is not the legal owner. Accordingly, total project costs incurred during construction were capitalized along with a corresponding financing obligation for the project costs that were incurred by the lessor. In addition, the Company capitalized the estimated fair value of the pre-existing structure of $4.1 million at the date construction commenced as construction-in-progress with a corresponding financing obligation. Upon completion of the project, the Company has continued involvement beyond a normal leaseback, and therefore has not recorded a sale or derecognized the assets. As a result, the lease is accounted for as a financing transaction and the recorded asset and related financing obligation remains on the Balance Sheet.

As of September 27, 2014, future minimum lease payments under financing obligations, capital lease obligations and non-cancellable operating leases as well as minimum payments to be received under non-cancellable subleases are as follows (in thousands):

Fiscal Year	Capital Leases			Operating Leases		Subleases			Financing Obligations
2015	$	3,838		$	15,856	$	(939	)	$	8,828
2016		3,838			12,457		(783	)		9,773
2017		3,838			9,867		(633	)		9,773
2018		3,838			7,402		(585	)		9,868
2019		3,838			3,736		(562	)		9,956
Thereafter		27,820			26,736		(1,429	)		105,833
Total	$	47,010		$	76,054	$	(4,931	)	$	154,031
Less: amount representing interest		(14,886	)
Present value of future minimum lease payments	$	32,124

The above table for financing obligations represents the portion of the future minimum lease payments which have been allocated to the facility in Burlington, Massachusetts and will be recognized as reductions to the financing obligation and as interest expense.

Legal Proceedings

On May 9, 2011, an organization named Council for Education and Research on Toxics ("CERT"), purporting to act in the public interest, filed suit in Los Angeles Superior Court (Council for Education and Research on Toxics v. Brad Barry LLC, et al., Case No. BC461182) against several companies, including the Company, that roast, package, or sell coffee in California. The Brad Barry complaint alleges that coffee contains the chemical acrylamide and

that the Company and the other defendants are required to provide warnings under section 25249.6 of the California Safe Drinking Water and Toxics Enforcement Act, better known as Proposition 65. Acrylamide is not added to coffee, but forms in trace amounts (parts per billion) as part of a chemical reaction that occurs in the coffee bean when it is roasted. Therefore it is present in all roasted coffee. To date, the Company is unaware of any reliable method for reducing acrylamide levels in coffee without adversely affecting the quality of the product. The Brad Barry action has been consolidated for all purposes with another Proposition 65 case filed by CERT on April 13, 2010 over allegations of acrylamide in "ready to drink" coffee sold in restaurants, convenience stores, and donut shops. (Council for Education and Research on Toxics v. Starbucks Corp., et al., Case No. BC 415759). The Company was not named in the Starbucks complaint. The Company has joined a joint defense group ("JDG") organized to address CERT's allegations, and the Company intends to vigorously defend against these allegations. The Court ordered the case phased for discovery and trial. Trial of the first phase of the case commenced on September 8, 2014 and was limited to three affirmative defenses shared by all defendants in both cases. Other affirmative defenses, plaintiff's prima facie case, and remedies are deferred for subsequent phases if Defendants do not prevail on the three Phase 1 defenses. Testimony in Phase 1 was completed on November 3, 2014. The Court has scheduled a hearing on evidentiary issues on December 3, 2014, after which the Court will set a schedule for submission of post-trial briefs and proposed findings of fact and conclusions of law. At this stage of the proceedings, the Company is unable to predict its outcome, the potential loss or range of loss, if any, associated with its resolution or any potential effect it may have on the Company or its operations.

On January 24, 2012, Teashot, LLC ("Teashot") filed suit against the Company, Keurig and Starbucks Corp. ("Starbucks") in the United States District Court for the District of Colorado (Civil Action No. 12-cv-00189-WJM-KMT) for patent infringement related to the making, using, importing, selling and/or offering for sale of K-Cup® portion packs containing tea. The suit alleges that the Company, Keurig and Starbucks infringe a Teashot patent (U.S. Patent No. 5,895,672). Teashot seeks an injunction prohibiting the Company, Keurig and Starbucks from continued infringement, as well as money damages. Pursuant to the Company's Manufacturing, Sales and Distribution Agreement with Starbucks, the Company is defending and indemnifying Starbucks in connection with the suit. On May 24, 2013, the Company and Keurig, for themselves and Starbucks, filed a motion for summary judgment of non-infringement. On July 19, 2013, Teashot filed a motion for partial summary judgment on certain other, unrelated issues. On February 6, 2014, the district court granted the Company's motion for summary judgment and denied Teashot's motion. The court also awarded the Company its costs. On February 27, 2014, Teashot filed a notice of appeal with the United States Court of Appeals for the Federal Circuit seeking review of the District Court's decision. Oral argument was completed on November 3, 2014. At this time, the Company is unable to predict the outcome of this lawsuit, the potential loss or range of loss, if any, associated with the resolution of this lawsuit or any potential effect it may have on the Company or its operations.

Securities and Exchange Commission ("SEC") Inquiry

On October 16, 2014, the staff of the SEC's Division of Enforcement notified the Company that it had concluded its previously disclosed inquiry into matters at the Company without

recommending enforcement against the Company or any of its current or former employees.

Stockholder Litigation

One putative securities fraud class action is presently pending against the Company and certain of its officers and directors, along with two putative stockholder derivative actions. The pending putative securities fraud class action was filed on November 29, 2011. The first putative stockholder derivative action is a consolidated action pending in the United States District Court for the District of Vermont that consists of five separate putative stockholder derivative complaints, the first two were filed after the Company's disclosure of the SEC inquiry on September 28, 2010, while the others were filed on February 10, 2012, March 2, 2012, and July 23, 2012, respectively. The second putative stockholder derivative action is pending in the Superior Court of the State of Vermont for Washington County and was commenced following the Company's disclosure of the SEC inquiry on September 28, 2010.

The putative securities fraud class action, captioned Louisiana Municipal Police Employees' Retirement System ("LAMPERS") v. Green Mountain Coffee Roasters, Inc., et al., Civ. No. 2:11-cv-00289, was filed in the United States District Court for the District of Vermont before the Honorable William K. Sessions, III. Plaintiffs' amended complaint alleged violations of the federal securities laws in connection with the Company's disclosures relating to its revenues and its inventory accounting practices. The amended complaint sought class certification, compensatory damages, attorneys' fees, costs, and such other relief as the court should deem just and proper. Plaintiffs sought to represent all purchasers of the Company's securities between February 2, 2011 and November 9, 2011. The initial complaint filed in the action on November 29, 2011 included counts for alleged violations of (1) Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 (the "Securities Act") against the Company, certain of its officers and directors, and the Company's underwriters in connection with a May 2011 secondary common stock offering; and (2) Section 10(b) of the Exchange Act and Rule 10b-5 against the Company and the officer defendants, and for violation of Section 20(a) of the Exchange Act against the officer defendants. Pursuant to the Private Securities Litigation Reform Act of 1995, 15 U.S.C. § 78u-4(a)(3), plaintiffs had until January 30, 2012 to move the court to serve as lead plaintiff of the putative class. Competing applications were filed and the Court appointed Louisiana Municipal Police Employees' Retirement System, Sjunde AP-Fonden, Board of Trustees of the City of Fort Lauderdale General Employees' Retirement System, Employees' Retirement System of the Government of the Virgin Islands, and Public Employees' Retirement System of Mississippi as lead plaintiffs' counsel on April 27, 2012. Pursuant to a schedule approved by the court, plaintiffs filed their amended complaint on October 22, 2012, and plaintiffs filed a corrected amended complaint on November 5, 2012. Plaintiffs' amended complaint did not allege any claims under the Securities Act against the Company, its officers and directors, or the Company's underwriters in connection with the May 2011 secondary common stock offering. Defendants moved to dismiss the amended complaint on March 1, 2013 and on December 20, 2013, the court issued an order dismissing the amended complaint with prejudice. On January 21, 2014, plaintiffs filed a notice of intent to appeal the court's December 20, 2013 order to the United States Court of Appeals for the Second Circuit. Pursuant to a schedule entered by the appeals court, briefing on the appeal was completed on June 23, 2014. The Second Circuit has scheduled an oral argument for December 1, 2014. The underwriters previously named as defendants notified the Company of their intent to seek indemnification from the Company pursuant to their underwriting agreement dated May 5, 2011 in regard to the claims asserted in this action.

The first putative stockholder derivative action, a consolidated action captioned In re Green Mountain Coffee Roasters, Inc. Derivative Litigation, Civ. No. 2:10-cv-00233, premised on the same allegations asserted in the now dismissed Horowitz v. Green Mountain Coffee Roasters, Inc., Civ. No. 2:10-cv-00227 securities class action complaint, the LAMPERS action described above, and the now dismissed action captioned Fifield v. Green Mountain Coffee Roasters, Inc., Civ. No. 2:12-cv-00091, is pending in the United States District Court for the District of Vermont before the Honorable William K. Sessions, III. On November 29, 2010, the federal court entered an order consolidating two actions and appointing the firms of Robbins Umeda LLP and Shuman Law Firm as co-lead plaintiffs' counsel. On February 23, 2011, the federal court approved a stipulation filed by the parties providing for a temporary stay of that action until the court rules on defendants' motions to dismiss the consolidated complaint in the Horowitz putative securities fraud class action. On March 7, 2012, the federal court approved a further joint stipulation continuing the temporary stay until the court either denies a motion to dismiss the Horowitz putative securities fraud class action or the Horowitz putative securities fraud class action is dismissed with prejudice. On April 27, 2012, the federal court entered an order consolidating the stockholder derivative action captioned Himmel v. Robert P. Stiller, et al., with two additional putative derivative actions, Musa Family Revocable Trust v. Robert P. Stiller, et al., Civ. No. 2:12-cv-00029, and Laborers Local 235 Benefit Funds v. Robert P. Stiller, et al., Civ. No. 2:12-cv- 00042. On November 14, 2012, the federal court entered an order consolidating an additional stockholder derivative action, captioned Henry Cargo v. Robert P. Stiller, et al., Civ. No. 2:12-cv-00161, and granting plaintiffs leave to lift the stay for the limited purpose of filing a consolidated complaint. The consolidated complaint is asserted nominally on behalf of the Company against certain of its officers and directors. The consolidated complaint asserts claims for breach of fiduciary duty, waste of corporate assets, unjust enrichment, contribution, and indemnification and seeks compensatory damages, injunctive relief, restitution, disgorgement, attorney's fees, costs, and such other relief as the court should deem just and proper. On May 14, 2013, the court approved a joint stipulation filed by the parties providing for a temporary stay of the proceedings until the conclusion of the appeal in the Horowitz putative securities fraud class action. On August 1, 2013, the parties filed a further joint stipulation continuing the temporary stay until the court either denies a motion to dismiss the LAMPERS putative securities fraud class action or the LAMPERS putative securities fraud class action is dismissed with prejudice, which the court approved on August 2, 2013. On February 24, 2014, the court approved a further joint stipulation filed by the parties continuing the temporary stay until the appeals court rules on the pending appeal in the LAMPERS putative securities fraud class action.

The second putative stockholder derivative action, M. Elizabeth Dickinson v. Robert P. Stiller, et al., Civ. No. 818-11-10, is pending in the Superior Court of the State of Vermont for Washington County. On February 28, 2011, the court approved a stipulation filed by the parties similarly providing for a temporary stay of that action until the federal court rules on defendants' motions to dismiss the consolidated complaint in the Horowitz putative securities fraud class action. As a result of the federal court's ruling in the Horowitz putative securities fraud class action, the temporary stay was lifted. On June 25, 2013, plaintiff filed an amended complaint in the action, which is asserted nominally on behalf of the Company against certain current and former directors and officers. The amended complaint is premised on the same allegations alleged in the Horowitz, LAMPERS, and Fifield putative securities fraud class actions. The amended complaint asserts claims for breach of fiduciary duty, unjust enrichment, waste of corporate assets, and alleged insider selling by certain of the named defendants. The amended complaint seeks compensatory damages, injunctive relief, restitution, disgorgement, attorneys' fees, costs, and such other relief as the court should deem just and proper. On August 7, 2013, the parties filed a further joint stipulation continuing the temporary stay until the court either denies a motion to dismiss the LAMPERS putative securities fraud class action or the LAMPERS putative securities fraud class action is dismissed with prejudice, which the court approved on August 21, 2013. On April 21, 2014, the court approved a joint stipulation filed by the parties continuing the temporary stay until the appeals court rules on the pending appeal in the LAMPERS putative securities fraud class action.

The Company and the other defendants intend to vigorously defend all the pending lawsuits. Additional lawsuits may be filed and, at this time, the Company is unable to predict the outcome of these lawsuits, the possible loss or range of loss, if any, associated with the resolution of these lawsuits or any potential effect they may have on the Company or its operations.

Antitrust Litigation

On February 11, 2014, TreeHouse Foods, Inc., Bay Valley Foods, LLC, and Sturm Foods, Inc. filed suit against Green Mountain Coffee Roasters, Inc. and Keurig, Inc. in the U.S. District Court for the Southern District of New York (TreeHouse Foods, Inc. et al. v. Green Mountain Coffee Roasters, Inc. et al., No. 1:14-cv-00905-VSB). The TreeHouse complaint asserts claims under the federal antitrust laws and various state laws, contending that the Company has monopolized alleged markets for single serve coffee brewers and single serve coffee portion packs, including through its contracts with suppliers and distributors and in connection with the launch of its next generation coffee brewer. The TreeHouse complaint seeks monetary damages, declaratory relief, injunctive relief, and attorneys' fees.

On March 13, 2014, JBR, Inc. (d/b/a Rogers Family Company) filed suit against Keurig Green Mountain, Inc. in the U.S. District Court for the Eastern District of California (JBR, Inc. v. Keurig Green Mountain, Inc., No. 2:14-cv-00677-KJM-CKD). The claims asserted and relief sought in the JBR complaint are substantially similar to the claims asserted and relief sought in the TreeHouse complaint.

Additionally, beginning on March 10, 2014, twenty-seven putative class actions asserting similar claims and seeking similar relief have been filed on behalf of purported direct and indirect purchasers of the Company's products in various federal district courts. On June 3, 2014, the Judicial Panel on Multidistrict Litigation granted a motion to transfer these various actions, including the TreeHouse and JBR actions, to a single judicial district for coordinated or consolidated pre-trial proceedings. The actions are now pending before Judge Vernon S. Broderick in the Southern District of New York (In re: Keurig Green Mountain Single-Serve Coffee Antitrust Litigation, No. 1:14-md-02542-VSB).

On June 23, 2014, TreeHouse and JBR filed a joint motion to expedite discovery, which the Court granted in part and denied in part on July 23, 2014. On August 11, 2014, JBR filed a motion for a preliminary injunction, which the Company opposed. The Court held a hearing on September 3-4, 2014, and by order dated September 19, 2014, the Court denied JBR's motion for a preliminary injunction. On September 24, 2014, JBR filed a notice of appeal of the denial of the preliminary injunction. On October 28, 2014, JBR moved to expedite its appeal, and on November 7, 2014, the Company filed an opposition to JBR's motion for expedited treatment. A briefing schedule for the appeal has not yet been set.

Consolidated putative class action complaints by direct purchaser and indirect purchaser plaintiffs were filed on July 24, 2014. The Company filed motions to dismiss these complaints and the complaints in the TreeHouse and JBR actions on October 3, 2014. On October 27, 2014, all plaintiffs informed the Company of their decision to amend their complaints rather than oppose the Company's motions to dismiss. Plaintiffs' amended complaints are due November 25, 2014

On September 30, 2014, a statement of claim was filed against the Company and Keurig Canada Inc. in Ontario, Canada by Club Coffee L.P. ("Club Coffee"), a Canadian manufacturer of single-serve beverage packs, claiming damages of $600 million and asserting a breach of competition law and false and misleading statements by the Company. On October 21, 2014, Club Coffee filed an amended statement of claim against the Company and Keurig Canada, Inc. claiming the same amount of damages as in the original statement of claim and asserting essentially the same breaches of competition law and false and misleading statements by the Company.

The Company intends to vigorously defend all of the pending lawsuits. At this time, the Company is unable to predict the outcome of these lawsuits, the potential loss or range of loss, if any, associated with the resolution of these lawsuits or any potential effect they may have on the Company or its operations.

Product Liability

In November 2014, the Company informed the U.S. Consumer Product Safety Commission and Health Canada that it identified a potential issue involving certain Keurig MINI Plus (non-reservoir) brewers (K10 and B31 models), where on very rare occasions, hot liquid could escape the brewer. As a result, the Company has recorded a net charge in fiscal 2014 of approximately $10.0 million in its statement of operations. This represents the Company's current best estimate, based on a number of assumptions, of the cost to remediate this issue and related expenses. Included in this charge is the recovery that the Company expects to receive from its insurance carriers where the Company has a legally enforceable contract that stipulates the terms of the insurance coverage and where the terms are not in or expected to be in dispute. Such charge is based on estimates, and therefore, the Company's ultimate liability and recovery may exceed or be less than the amounts recorded. Based on current information known to the Company, the Company believes that this issue will not have a material adverse effect on the consolidated financial position, results of operations or cash flows of the Company.

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Commitments and Contingencies (Details 2) (USD $)		12 Months Ended
	Sep. 27, 2014	Sep. 27, 2014 Manufacturing Facility [Member] item	Sep. 27, 2014 Burlington Facility [Member] sqft	Jun. 30, 2012 Burlington Facility [Member]
Lease Commitments
Initial term of capital lease		15 years
Number of additional optional renewals of capital lease		6
Capital leases optional renewal term		5 years
Area of leased property recorded as an asset with related financing obligation			425,000
Pre-existing fair value capitalized				$ 4,100,000
Capital Leases
2015	3,838,000
2016	3,838,000
2017	3,838,000
2018	3,838,000
2019	3,838,000
Thereafter	27,820,000
Total	47,010,000
Less: amount representing interest	(14,886,000)
Present value of future minimum lease payments	32,124,000
Operating Leases
2015	15,856,000
2016	12,457,000
2017	9,867,000
2018	7,402,000
2019	3,736,000
Thereafter	26,736,000
Total	76,054,000
Subleases
2015	(939,000)
2016	(783,000)
2017	(633,000)
2018	(585,000)
2019	(562,000)
Thereafter	(1,429,000)
Total minimum income	(4,931,000)
Financing Obligations
2015	8,828,000
2016	9,773,000
2017	9,773,000
2018	9,868,000
2019	9,956,000
Thereafter	105,833,000
Total	$ 154,031,000

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Nature of Business and Organization (Details)	3 Months Ended												12 Months Ended
	Sep. 27, 2014	Jun. 28, 2014	Mar. 29, 2014	Dec. 28, 2013	Sep. 28, 2013	Jun. 29, 2013	Mar. 30, 2013	Dec. 29, 2012	Sep. 29, 2012	Jun. 23, 2012	Mar. 24, 2012	Dec. 24, 2011	Sep. 27, 2014 item segment	Sep. 28, 2013	Sep. 29, 2012
Nature of Business and Organization
Number of operating segments													2
Number of channels in which products are distributed													2
Length of fiscal period	91 days	91 days	91 days	91 days	91 days	91 days	91 days	91 days	98 days	91 days	91 days	91 days	364 days	364 days	371 days

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Fair Value Measurements (Tables)

12 Months Ended

Sep. 27, 2014

Fair Value Measurements

Summary of the fair values and the levels used in fair value measurements for financial assets (liabilities)

The following table summarizes the fair values and the levels used in fair value measurements as of September 27, 2014 for the Company's financial (liabilities) assets (in thousands):

	Fair Value Measurements Using
	Level 1		Level 2			Level 3
Derivatives:
Interest rate swaps	$	—	$	(3,371	)	$	—
Cross currency swap		—		5,951			—
Coffee futures		—		3,437			—
Foreign currency forward contracts		—		108			—
Total	$	—	$	6,125		$	—

The following table summarizes the fair values and the levels used in fair value measurements as of September 28, 2013 for the Company's financial liabilities (in thousands):

	Fair Value Measurements Using
	Level 1		Level 2			Level 3
Derivatives:
Interest rate swaps	$	—	$	(6,004	)	$	—
Cross currency swap		—		(1,253	)		—
Coffee futures		—		(3,809	)		—
Foreign currency forward contracts		—		(128	)		—
Total	$	—	$	(11,194	)	$	—

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Consolidated Statements of Comprehensive Income (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Consolidated Statements of Comprehensive Income
Net income	$ 597,414	$ 484,103	$ 363,500
Cash flow hedges, Pre-tax:
Unrealized gains (losses) arising during the period, Pre-tax	20,641	(3,732)	(1,234)
Losses reclassified to net income, Pre-tax	6,315	1,484	1,359
Foreign currency translation adjustments, Pre-tax	(52,068)	(28,742)	25,353
Other comprehensive (loss) income, Pre-tax	(25,112)	(30,990)	25,478
Cash flow hedges, Tax (expense) benefit:
Unrealized gains (losses) arising during the period, Tax (expense) benefit	(8,307)	1,489	498
Losses reclassified to net income, Tax (expense) benefit	(2,556)	(599)	(549)
Other comprehensive (loss) income, Tax (expense) benefit	(10,863)	890	(51)
Cash flow hedges, After-tax:
Unrealized gains (losses) arising during the period, After-tax	12,334	(2,243)	(736)
Losses reclassified to net income, After-tax	3,759	885	810
Foreign currency translation adjustments, After-tax	(52,068)	(28,742)	25,353
Other comprehensive (loss) income, After-tax	(35,975)	(30,100)	25,427
Total comprehensive income	561,439	454,003	388,927
Total comprehensive (loss) income attributable to noncontrolling interests	(203)	156	1,524
Total comprehensive income attributable to Keurig	$ 561,642	$ 453,847	$ 387,403

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Employee Compensation Plans (Details 5) (USD $)	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Restricted Stock Units (RSUs) [Member]
Share Units
Nonvested at beginning of the period (in shares)	221,502
Granted (in shares)	259,507		55,432
Vested (in shares)	(56,781)
Forfeited (in shares)	(15,055)
Nonvested at end of the period (in shares)	409,173	221,502
Weighted Average Grant-Date Fair Value
Nonvested at beginning of the period (in dollars per shares)	$ 42.74
Granted (in dollars per shares)	$ 119.95	$ 45.19
Vested (in dollars per shares)	$ 61.04
Forfeited (in dollars per shares)	$ 82.00
Nonvested at end of the period (in dollars per shares)	$ 86.50	$ 42.74
Weighted average remaining contractual life of unvested awards	3 years 3 months 4 days	1 year 8 months 16 days
Intrinsic value of unvested awards	$ 53,450,000	$ 16,586,000
Awards expected to vest (in shares)	406,521
Intrinsic value of awards expected to vest	53,100,000
Total intrinsic value of awards converted to shares of common stock	6,100,000	2,200,000
Performance Shares [Member]
Compensation Plans
Vesting period of award	3 years
Share Units
Nonvested at beginning of the period (in shares)	120,668
Granted (in shares)	84,232
Forfeited (in shares)	(9,118)
Nonvested at end of the period (in shares)	195,782	120,668
Weighted Average Grant-Date Fair Value
Nonvested at beginning of the period (in dollars per shares)	$ 41.10
Granted (in dollars per shares)	$ 107.12	$ 41.28
Forfeited (in dollars per shares)	$ 86.87
Nonvested at end of the period (in dollars per shares)	$ 67.38	$ 41.10
Outstanding awards, at the threshold award level	172,313
Outstanding awards, at the maximum award level	297,689
Awards converted to shares of common stock	0
Restricted Stock [Member]
Weighted Average Grant-Date Fair Value
Total intrinsic value of awards vested		$ 2,700,000
Minimum [Member] | Restricted Stock Units (RSUs) [Member]
Compensation Plans
Vesting period of award	3 years
Minimum [Member] | Restricted Stock [Member]
Compensation Plans
Vesting period of award	3 years
Maximum [Member] | Restricted Stock Units (RSUs) [Member]
Compensation Plans
Vesting period of award	4 years
Maximum [Member] | Restricted Stock [Member]
Compensation Plans
Vesting period of award	4 years

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Divestitures

12 Months Ended

Sep. 27, 2014

Divestitures

Divestitures

3.     Divestitures

Fiscal 2012

On October 3, 2011, all the outstanding shares of Van Houtte USA Holdings, Inc., also known as the Van Houtte U.S. Coffee Service business or the "Filterfresh" business, were sold to ARAMARK Refreshment Services, LLC ("ARAMARK") in exchange for $149.5 million in cash. Approximately $4.4 million of cash was transferred to ARAMARK as part of the sale and $7.4 million was repaid to ARAMARK upon finalization of the purchase price, resulting in a net cash inflow related to the Filterfresh sale of $137.7 million. The Company recognized a gain on the sale of $26.3 million during the thirteen weeks ended December 24, 2011. Filterfresh had been included in the Canada segment.

Filterfresh revenues and net income included in the Company's consolidated statement of operations were as follows (dollars in thousands, except per share data):

	For the period September 25, 2011 through October 3, 2011 (date of sale)
Net sales	$	2,286
Net income	$	229
Less income attributable to noncontrolling interests		20
Net income attributable to Keurig	$	209
Diluted net income per share	$	—

After the disposition, the Company continues to sell coffee and brewers to Filterfresh, which prior to the sale of Filterfresh were eliminated and were not reflected in the Consolidated Statement of Operations. For fiscal 2012, the Company's sales to Filterfresh through October 3, 2011 (date of sale) that were eliminated in consolidation were $0.6 million.

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Goodwill and Intangible Assets (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended					12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 27, 2014 Domestic Segment [Member]	Sep. 28, 2013 Domestic Segment [Member]	Sep. 29, 2012 Domestic Segment [Member]	Sep. 27, 2014 Canada Segment [Member]	Sep. 28, 2013 Canada Segment [Member]
Changes in the carrying amount of goodwill
Balance at the beginning of the period	$ 788,184	$ 808,076	$ 369,353	$ 369,353	$ 369,353	$ 418,831	$ 438,723
Other	(233)					(233)
Foreign currency effect	(32,056)	(19,892)				(32,056)	(19,892)
Balance at the end of the period	$ 755,895	$ 788,184	$ 369,353	$ 369,353	$ 369,353	$ 386,542	$ 418,831

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Stockholders' Equity (Details 2) (USD $)	12 Months Ended			0 Months Ended		12 Months Ended					0 Months Ended	12 Months Ended			0 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012	Feb. 28, 2014 Accelerated Share Repurchase Program February 2014 [Member] Major Financial Institution [Member]	Sep. 27, 2014 Accelerated Share Repurchase Program February 2014 [Member] Major Financial Institution [Member]	Sep. 27, 2014 Common Stock Share Repurchase Programs [Member]	Sep. 28, 2013 Common Stock Share Repurchase Programs [Member]	Sep. 27, 2014 Common Stock [Member]	Sep. 28, 2013 Common Stock [Member]	Sep. 29, 2012 Common Stock [Member]	Feb. 28, 2014 Common Stock [Member] Accelerated Share Repurchase Program February 2014 [Member] Major Financial Institution [Member]	Sep. 27, 2014 Additional Paid-in Capital [Member]	Sep. 28, 2013 Additional Paid-in Capital [Member]	Sep. 29, 2012 Additional Paid-in Capital [Member]	Feb. 28, 2014 Additional Paid-in Capital [Member] Accelerated Share Repurchase Program February 2014 [Member] Major Financial Institution [Member]
Stockholders' equity
Fixed price of share repurchase	$ 1,052,430,000	$ 188,278,000	$ 76,470,000	$ 700,000,000
Value of initial shares as percent of total fixed purchase price				70.00%
Value of initial shares											400,000				489,600,000
Value of stock held back pending final settlement															210,000,000
Maximum number of shares that may be required to be issued on settlement				10,000,000
Additional shares that would have been issued if ASR was settled					1,900,000
Value of shares available for repurchase under the current authorization						1,182,800,000
Number of shares acquired				4,340,508		8,138,592	5,642,793	8,138,592	5,642,793	3,120,700
Average price per share of acquired shares (in dollars per share)						$ 103.51	$ 33.37
Total cost of acquired shares	$ 1,052,430,000	$ 188,278,000	$ 76,470,000			$ 1,052,430,000	$ 188,278,000	$ 814,000	$ 564,000	$ 312,000		$ 1,051,616,000	$ 187,714,000	$ 76,158,000

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Derivative Financial Instruments (Details 2) (USD $) In Thousands, unless otherwise specified	Sep. 27, 2014	Sep. 28, 2013
Fair value of derivatives
Total fair value of derivatives	$ 6,125	$ (11,194)
Fair value of derivative liabilities	(3,371)	(11,207)
Fair value of derivative assets	9,496	13
Commodity Contract [Member]
Fair value of derivatives
Total fair value of derivatives	3,437	(3,809)
Designated as Hedging Instrument [Member]
Fair value of derivatives
Total fair value of derivatives	174	(9,941)
Designated as Hedging Instrument [Member] | Interest Rate Swap [Member] | Other Current Liabilities [Member]
Fair value of derivatives
Fair value of derivative liabilities	(3,371)	(6,004)
Designated as Hedging Instrument [Member] | Commodity Contract [Member] | Other Current Liabilities [Member]
Fair value of derivatives
Fair value of derivative liabilities		(3,809)
Designated as Hedging Instrument [Member] | Commodity Contract [Member] | Other Current Assets [Member]
Fair value of derivatives
Fair value of derivative assets	3,437
Designated as Hedging Instrument [Member] | Foreign Exchange Forward [Member] | Other Current Liabilities [Member]
Fair value of derivatives
Fair value of derivative liabilities		(141)
Designated as Hedging Instrument [Member] | Foreign Exchange Forward [Member] | Other Current Assets [Member]
Fair value of derivatives
Fair value of derivative assets	108	13
Not Designated as Hedging Instrument [Member]
Fair value of derivatives
Total fair value of derivatives	5,951	(1,253)
Not Designated as Hedging Instrument [Member] | Cross Currency Interest Rate Contract [Member] | Other Current Liabilities [Member]
Fair value of derivatives
Fair value of derivative liabilities		(1,253)
Not Designated as Hedging Instrument [Member] | Cross Currency Interest Rate Contract [Member] | Other Current Assets [Member]
Fair value of derivatives
Fair value of derivative assets	$ 5,951

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Related Party Transactions

12 Months Ended

Sep. 27, 2014

Related Party Transactions

Related Party Transactions

20.   Related Party Transactions

The Company, from time to time, used travel services provided by Heritage Flight, a charter air services company acquired in September 2002 by Robert P. Stiller, who previously served on the Company's Board of Directors and who is a security holder of more than 5% of the Company's Common Stock. For fiscal years 2014, 2013 and 2012 the Company incurred expenses of $0.0 million, $0.2 million, and $0.7 million, respectively, for Heritage Flight travel services.

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Fair Value Measurements (Details) (USD $)	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013
Fair Value Measurements
Total fair value of derivatives	$ 6,125,000	$ (11,194,000)
Carrying value of long-term debt	160,014,000	173,150,000
Period of reset of debt variable interest rates	30 days
Long-term investments carried at cost	35,900,000
Fair Value, Inputs, Level 2 [Member]
Fair Value Measurements
Total fair value of derivatives	6,125,000	(11,194,000)
Fair Value, Inputs, Level 2 [Member] | Interest Rate Swap [Member]
Fair Value Measurements
Total fair value of derivatives	(3,371,000)	(6,004,000)
Fair Value, Inputs, Level 2 [Member] | Cross Currency Swap [Member]
Fair Value Measurements
Total fair value of derivatives	5,951,000	(1,253,000)
Fair Value, Inputs, Level 2 [Member] | Coffee Futures [Member]
Fair Value Measurements
Total fair value of derivatives	3,437,000	(3,809,000)
Fair Value, Inputs, Level 2 [Member] | Foreign Exchange Forward [Member]
Fair Value Measurements
Total fair value of derivatives	$ 108,000	$ (128,000)

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Product Warranties (Tables)

12 Months Ended

Sep. 27, 2014

Product Warranties

Schedule of changes in the carrying amount of product warranties

The changes in the carrying amount of product warranties for fiscal years 2014 and 2013 are as follows (in thousands):

	Fiscal 2014			Fiscal 2013
Balance, beginning of year	$	7,804		$	20,218
Provision related to current period		27,484			20,447
Change in estimate		(1,485	)		(12,720	)
Usage		(20,953	)		(20,141	)
Balance, end of year	$	12,850		$	7,804

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Income Taxes

12 Months Ended

Sep. 27, 2014

Income Taxes

Income Taxes

13.   Income Taxes

Income before income taxes and the provision for income taxes for fiscal years 2014, 2013 and 2012, consist of the following (in thousands):

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Income before income taxes:
Domestic	$	856,240		$	675,438		$	486,258
Foreign		68,133			65,436			89,883
Total income before income taxes	$	924,373		$	740,874		$	576,141
Income tax expense:
United States federal:
Current	$	288,757		$	202,006		$	75,932
Deferred		(41,589	)		(8,654	)		74,042
		247,168			193,352			149,974
State and local:
Current		61,839			47,930			40,270
Deferred		(811	)		(1,695	)		(712	)
		61,028			46,235			39,558
Total United States		308,196			239,587			189,532
Foreign:
Current		36,903			29,901			26,860
Deferred		(18,140	)		(12,717	)		(3,751	)
Total foreign		18,763			17,184			23,109
Total income tax expense	$	326,959		$	256,771		$	212,641

Net deferred tax liabilities consist of the following (in thousands) as of:

	September 27, 2014			September 28, 2013
Deferred tax assets:
Section 263A capitalized expenses	$	9,011		$	1,876
Deferred hedging gains		—			4,774
Deferred compensation		17,053			13,632
Capital loss carryforward		1,568			1,418
Valuation allowance—capital loss carryforward		(1,568	)		(1,418	)
Warranty, obsolete inventory and bad debt allowance		42,903			32,692
Tax credit carryforwards		2,085			3,651
Other reserves and temporary differences		10,053			15,558
Gross deferred tax assets		81,105			72,183
Deferred tax liabilities:
Prepaid expenses		(6,190	)		(2,994	)
Deferred hedging losses		(6,059	)		—
Depreciation		(97,977	)		(125,504	)
Intangible assets		(115,812	)		(138,262	)
Other reserves and temporary differences		(174	)		(237	)
Gross deferred tax liabilities		(226,212	)		(266,997	)
Net deferred tax liabilities	$	(145,107	)	$	(194,814	)

A reconciliation for continuing operations between the amount of reported income tax expense and the amount computed using the U.S. Federal Statutory rate of 35% is as follows (in thousands):

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Tax at U.S. Federal Statutory rate	$	323,530		$	259,306		$	201,692
Increase (decrease) in rates resulting from:
Foreign tax rate differential		(13,614	)		(13,087	)		(18,072	)
Non-deductible stock compensation expense		1,562			2,700			1,024
State taxes, net of federal benefit		47,195			31,869			27,114
Provincial taxes		8,080			7,878			10,591
Domestic production activities deduction		(32,568	)		(23,558	)		(9,245	)
Federal tax credits		(336	)		(4,506	)		(282	)
Release of capital loss valuation allowance		—			—			(3,071	)
Other		(6,890	)		(3,831	)		2,890
Tax at effective rates	$	326,959		$	256,771		$	212,641

As of September 27, 2014, the Company had a $17.7 million state capital loss carryforward and a state net operating loss carryforward of $11.5 million available to be utilized against future taxable income for years through fiscal 2015 and 2029, respectively, subject to annual limitation pertaining to change in ownership rules under the Internal Revenue Code of 1986, as amended (the "Code"). Based upon earnings history, the Company concluded that it is more likely than not that the net operating loss carryforward will be utilized prior to its expiration but that the capital loss carryforward will not. The Company has recorded a valuation allowance against the entire deferred tax asset balance for the capital loss carryforward.

The total amount of unrecognized tax benefits as of September 27, 2014 and September 28, 2013 was $14.8 million and $23.3 million, respectively. The amount of unrecognized tax benefits at September 27, 2014 that would impact the effective tax rate if resolved in favor of the Company is $14.8 million. As a result of prior acquisitions, the Company is indemnified for up to $9.2 million of the total reserve balance, and the indemnification is capped at CDN $30.0 million. If these unrecognized tax benefits are resolved in favor of the Company, the associated indemnification receivable, recorded in other long-term assets would be reduced accordingly. As of September 27, 2014 and September 28, 2013, accrued interest and penalties of $2.4 million and $2.0 million, respectively, were included in the Consolidated Balance Sheets. The Company recognizes interest and penalties in income tax expense. The Company released $0.2 million of unrecognized tax benefits in the fourth quarter of fiscal 2014 due to the expiration of the statute of limitations. Income tax expense included $0.4 million, $0.4 million and $0.2 million of interest and penalties for fiscal 2014, 2013, and 2012, respectively.

A reconciliation of increases and decreases in unrecognized tax benefits, including interest and penalties, is as follows (in thousands):

	Fiscal 2014			Fiscal 2013			Fiscal 2012
Gross tax contingencies—balance, beginning of year	$	23,283		$	23,956		$	24,419
Increases from positions taken during prior periods		—			438			2,864
Decreases from positions taken during prior periods		—			—			(4,093	)
Increases from positions taken during current periods		504			2,709			906
Decreases resulting from the lapse of the applicable statute of limitations		(8,948	)		(3,820	)		(140	)
Gross tax contingencies—balance, end of year	$	14,839		$	23,283		$	23,956

The Company expects to release $5.0 million of unrecognized tax benefits during fiscal 2015 due to the expiration of the statute of limitations.

As of September 27, 2014, the Company had approximately $200.9 million of undistributed international earnings, most of which are Canadian-sourced. With the exception of the repayment of intercompany debt, all earnings of the Company's foreign subsidiaries are considered indefinitely reinvested and no U.S. deferred taxes have been provided on those earnings. If these amounts were distributed to the U.S. in the form of dividends or otherwise, the Company would be subject to additional U.S. income taxes, which could be material. Determination of the amount of any unrecognized deferred income tax on these earnings is not practicable because such liability, if any, is dependent on circumstances existing if and when remittance occurs.

In the normal course of business, the Company is subject to tax examinations by taxing authorities both inside and outside the United States. With some exceptions, the Company is no longer subject to examinations with respect to returns filed for fiscal years prior to 2010.

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Schedule II-Valuation and Qualifying Accounts (Details) (USD $)	12 Months Ended
	Sep. 27, 2014	Sep. 28, 2013	Sep. 29, 2012
Allowance for Doubtful Accounts [Member]
Valuation and Qualifying Accounts
Balance at Beginning of Period	$ 2,886,000	$ 2,750,000	$ 3,404,000
Acquisitions (Dispositions)			(299,000)
Charged to Costs and Expenses	1,782,000	689,000	3,197,000
Deductions	1,398,000	553,000	3,552,000
Balance at End of Period	3,270,000	2,886,000	2,750,000
Allowance for Sales Returns [Member]
Valuation and Qualifying Accounts
Balance at Beginning of Period	30,754,000	31,767,000	18,302,000
Charged to Costs and Expenses	114,057,000	79,747,000	107,436,000
Deductions	81,961,000	80,760,000	93,971,000
Balance at End of Period	62,850,000	30,754,000	31,767,000
Warranty Reserves [Member]
Valuation and Qualifying Accounts
Balance at Beginning of Period	7,804,000	20,218,000	14,728,000
Charged to Costs and Expenses	24,158,000	6,948,000	37,390,000
Deductions	19,112,000	19,362,000	31,900,000
Balance at End of Period	12,850,000	7,804,000	20,218,000
Warranty recoveries from suppliers	$ 1,800,000	$ 800,000	$ 8,300,000