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Earn-out Liability Acquisition of Orchard Valley Harvest, Inc.
 6 Months Ended
Dec. 29, 2011
Earn-out Liability Acquisition of Orchard Valley Harvest, Inc. [Abstract]  
Earn-out Liability Acquisition of Orchard Valley Harvest, Inc.

Note 3 — Earn-out Liability — Acquisition of Orchard Valley Harvest, Inc.

Under terms of the Purchase Agreement by and between us and Orchard Valley Harvest, Inc. (“OVH”) dated May 5, 2010 (the “Purchase Agreement”), consideration of $7,579 ($5,079 of which was earned in calendar 2010 and $2,500 of which was earned in calendar 2011) was earned by OVH, which is in addition to the $32,887 cash purchase price paid. The period for measuring potential earn-out payments ended during the second quarter of fiscal 2012 and no further earn-out periods remain.

The following table summarizes the earn-outs that have been achieved under the terms of the Purchase Agreement. Net retail sales include packaged sales to the consumer distribution channel. Net sales are comprised of net retail sales plus bulk sales of products.

 

                         

Earn-out Measurement

   Earn-out
Payment		     Date of
Payment		     Earn-out Not
Achieved		  

Calendar 2010 net retail sales greater than $25,500

   $ 79      

 

 Q3 2011 &

Q2 2012

   

  

     —    

Calendar 2010 net sales greater than $41,500 and calendar 2010 net retail sales greater than $36,500

     5,000      
 		 Q3 2011 &
Q2 2012		   
  		     —    

Calendar 2011 net retail sales greater than $43,000

     2,500       Q3 2012       —    

Calendar 2010 and calendar 2011 net retail sales greater than $105,000

     —         —         2,500  
   

 

 

    

 

 

    

 

 

  

Total

   $ 7,579               2,500  
   

 

 

    

 

 

    

 

 

  

The two earn-out measurements based upon calendar 2010 net sales and net retail sales were both achieved in calendar 2010. Under terms of the Purchase Agreement, we paid $4,135 of this amount during the third quarter of fiscal 2011 and $944 of this amount during the second quarter of fiscal 2012. The earn-out measurement based upon calendar 2011 net retail sales was also achieved. Accordingly, we have a current liability of $2,500 as of December 29, 2011 which we expect to pay during the third quarter of fiscal 2012. The earn-out measurement based on combined calendar 2010 and calendar 2011 net retail sales was not achieved and therefore will not be paid out.

The change in the fair value measurement of the earn-out liability during the first twenty-six weeks of fiscal 2012 was not material.