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Acquisition of Orchard Valley Harvest, Inc
 12 Months Ended
Jun. 28, 2012
Acquisition of Orchard Valley Harvest, Inc [Abstract]  
ACQUISITION OF ORCHARD VALLEY HARVEST, INC

NOTE 3 — ACQUISITION OF ORCHARD VALLEY HARVEST, INC.

In May 2010, we purchased certain assets and assumed certain liabilities of OVH (the “Acquisition”) for a purchase price of $32,887. The purchase agreement provided for additional consideration of up to $10,079 contingent upon performance of the acquired business for the 2010 and 2011 calendar years. The earn-out liability initially recorded in purchase accounting represented the fair value of expected future payments, which was estimated by applying the income approach. The fair value was based on significant inputs that were not observable in the market, which ASC 820 refers to as Level 3 inputs. This additional consideration was not contingent on any selling shareholders remaining employed. Earn-out payments of $3,444 and $4,135 were made during fiscal 2012 and fiscal 2011, respectively. The period for measuring potential earn-out payments ended during fiscal 2012 and no further earn-out payments remain to be paid.

Of the additional $7,579 consideration earned and paid, $1,742 exceeded the acquisition-date fair value and is recorded as a decrease in the operating activities section of the consolidated statement of cash flows for the year ended June 28, 2012. The amounts not exceeding the acquisition-date fair value of $1,702 and $4,135 in fiscal 2012 and 2011 respectively, are recorded in the financing activities section of the consolidated statement of cash flows.

The change in the fair value measurement of the earn-out liability during fiscal 2012 was not material. The change in the fair value measurement of the earn-out liability during fiscal 2011 was $1,697.

The acquired business contributed revenues of $4,000 for the period from May 21, 2010 through June 24, 2010. In fiscal 2010, we incurred $700 of costs related to the Acquisition all of which were expensed and are included in administrative expenses.

The following reflects the unaudited pro forma results of operations of the Company for fiscal 2010:

 

         
    Year Ended
June 24, 2010		  

Net sales

   $ 614,336  

Net income

   $ 18,241  

Diluted earnings per share

   $ 1.70  

The unaudited pro forma results have been calculated after applying our accounting policies and adjusting the results of OVH to reflect elimination of transaction costs and record additional depreciation, amortization and interest expense that would have been charged, assuming the fair value adjustment to property and equipment and intangible assets had been applied, all net of related income taxes.