DIEDRICH'S ODD DISCLOSURE...

 

Included below is interesting commentary on Diedrich’s 10-Q filing yesterday from Michelle Leder at footnoted.org:

 

Late yesterday, Peet’s Coffee & Tea (PEET), my personal favorite when it comes to caffeine delivery devices, announced that it was buying Diedrich’s Coffee (DDRX) for $213 million.

 

Coincidentally, Diedrich’s filed what’s likely to be its last 10-Q yesterday. But what’s surprising was the very first exhibit in the 10-Q: an agreement with CFO Sean McCarthy. Now, McCarthy was named CFO back in January 2006. But the agreement was dated May 1, 2008 and was filed yesterday — roughly 17 months after it went into affect.

 

We don’t mean to be sticklers here, but what was the hold up with getting this into a filing? By our count, Diedrich has filed 4 10-Qs and 2 10-Ks since May 2008. Even if we assume that it was a typo and May 1, 2008 was really May 1, 2009 — not that that makes sense, but we’re going hypothetical here — there was still a K and a Q that they agreement could have been included in. The agreement itself confirms “in writing” the terms of a change in control, so presumably McCarthy had been working for the past three years under some sort of informal — or at least, non-written — understanding.

 

Now maybe it’s just an odd coincidence that this agreement was included on the very day that the company announced it was being acquired. But that’s a bit hard to swallow — kind of like coffee that’s been sitting in the pot for too long.

 

Michelle Leder

footnoted.org


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