Attached files
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EXCEL - IDEA: XBRL DOCUMENT - ARDEN GROUP INC | Financial_Report.xls |
EX-32 - EXHIBIT 32.1 - ARDEN GROUP INC | ex32-1.htm |
EX-10 - EXHIBIT 10.2 - ARDEN GROUP INC | ex10-2.htm |
EX-31 - EXHIBIT 31.2 - ARDEN GROUP INC | ex31-2.htm |
EX-10 - EXHIBIT 10.1 - ARDEN GROUP INC | ex10-1.htm |
EX-31 - EXHIBIT 31.1 - ARDEN GROUP INC | ex31-1.htm |
EX-32 - EXHIBIT 32.2 - ARDEN GROUP INC | ex32-2.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
☒ |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended September 28, 2013
OR
☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGEACT OF 1934 |
For the transition period from _______ to _______
Commission file number 0-9904
ARDEN GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware |
95-3163136 |
(State or other jurisdiction of |
(I.R.S. Employer Identification No.) |
incorporation or organization) |
|
2020 South Central Avenue, Compton, California 90220
(Address of principal executive offices including zip code)
Registrant’s telephone number, including area code (310) 638-2842
No Change
Former name, former address and former fiscal year, if changed since last report.
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 ☒ No ☐
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 ☒ No ☐
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 |
☐ |
Accelerated filer |
☒ |
Non-accelerated filer |
☐ |
Smaller reporting company |
☐ |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐ No ☒
The number of shares outstanding of the registrant’s class of common stock as of November 1, 2013 was:
3,071,000 shares of Class A Common Stock
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ARDEN GROUP, INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(In Thousands, Except Share and Per Share Data)
September 28, 2013 |
December 29, 2012 |
|||||||
Assets |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 20,206 | $ | 16,037 | ||||
Investments |
5,510 | 1,759 | ||||||
Accounts receivable, net of allowance for doubtful accounts, of $176 and $187 as of September 28, 2013 and December 29, 2012, respectively |
4,205 | 4,882 | ||||||
Income taxes receivable |
3,121 | 0 | ||||||
Inventories, net |
16,200 | 19,689 | ||||||
Deferred income taxes |
1,365 | 1,364 | ||||||
Other current assets |
4,413 | 3,581 | ||||||
Total current assets |
55,020 | 47,312 | ||||||
Property, plant and equipment, net |
46,367 | 38,074 | ||||||
Deferred income taxes |
1,761 | 1,761 | ||||||
Other assets |
2,886 | 2,900 | ||||||
Total assets |
$ | 106,034 | $ | 90,047 | ||||
Liabilities and Stockholders’ Equity |
||||||||
Current liabilities: |
||||||||
Accounts payable, trade |
$ | 16,627 | $ | 16,335 | ||||
Income taxes payable |
0 | 481 | ||||||
Short-term debt |
1,228 | 0 | ||||||
Other current liabilities |
20,276 | 16,162 | ||||||
Total current liabilities |
38,131 | 32,978 | ||||||
Long-term debt |
0 | 1,228 | ||||||
Deferred rent |
5,768 | 5,527 | ||||||
Other liabilities |
5,317 | 4,120 | ||||||
Total liabilities |
49,216 | 43,853 | ||||||
Commitments and contingent liabilities (Note 6) |
||||||||
Stockholders’ equity: |
||||||||
Common Stock, Class A, $0.25 par value; authorized 10,000,000 shares; 3,071,000 shares issued and outstanding as of September 28, 2013 and December 29, 2012, respectively, excluding 1,357,200 treasury shares |
1,107 | 1,107 | ||||||
Capital surplus |
5,271 | 5,271 | ||||||
Unrealized gain (loss) on investments, net of tax |
(1 | ) | 1 | |||||
Retained earnings |
54,194 | 43,568 | ||||||
60,571 | 49,947 | |||||||
Treasury stock, 1,357,200 shares at cost |
(3,753 | ) | (3,753 | ) | ||||
Total stockholders’ equity |
56,818 | 46,194 | ||||||
Total liabilities and stockholders’ equity |
$ | 106,034 | $ | 90,047 |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
ARDEN GROUP, INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF
COMPREHENSIVE INCOME
(UNAUDITED)
(In Thousands, Except Share and Per Share Data)
Thirteen Weeks Ended |
Thirty-Nine Weeks Ended |
|||||||||||||||
September 28, 2013 |
September 29, 2012 |
September 28, 2013 |
September 29, 2012 |
|||||||||||||
Sales |
$ | 112,121 | $ | 108,150 | $ | 336,807 | $ | 323,076 | ||||||||
Cost of sales |
69,497 | 66,396 | 208,264 | 199,614 | ||||||||||||
Gross profit |
42,624 | 41,754 | 128,543 | 123,462 | ||||||||||||
Selling, general and administrative expenses |
36,370 | 33,207 | 106,591 | 99,876 | ||||||||||||
Loss (gain) from exit activity |
(49 | ) | 6 | 121 | 1,912 | |||||||||||
Operating income |
6,303 | 8,541 | 21,831 | 21,674 | ||||||||||||
Interest and dividend income |
12 | 47 | 36 | 138 | ||||||||||||
Interest expense |
(22 | ) | (22 | ) | (65 | ) | (65 | ) | ||||||||
Other income (expense), net |
0 | 0 | 17 | 0 | ||||||||||||
Income before income taxes |
6,293 | 8,566 | 21,819 | 21,747 | ||||||||||||
Income tax provision |
2,564 | 3,491 | 8,890 | 8,861 | ||||||||||||
Net income |
$ | 3,729 | $ | 5,075 | $ | 12,929 | $ | 12,886 | ||||||||
Other comprehensive gain (loss), net of tax: |
||||||||||||||||
Net unrealized holding gain (loss) from available-for-sale securities, net of income tax expense (benefit) of $4 and ($1) for 2013 and $7 and $5 for 2012, respectively |
4 | 10 | (2 | ) | 7 | |||||||||||
Comprehensive income |
$ | 3,733 | $ | 5,085 | $ | 12,927 | $ | 12,893 | ||||||||
Basic and diluted net income per common share |
$ | 1.21 | $ | 1.65 | $ | 4.21 | $ | 4.20 | ||||||||
Basic and diluted weighted average common shares outstanding |
3,071,000 | 3,071,000 | 3,071,000 | 3,071,000 |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
ARDEN GROUP, INC. AND CONSOLIDATED SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In Thousands)
Thirty-Nine Weeks Ended |
||||||||
September 28, 2013 |
September 29, 2012 |
|||||||
Cash flows from operating activities: |
||||||||
Cash received from customers |
$ | 337,509 | $ | 323,383 | ||||
Cash paid to suppliers and employees |
(302,719 | ) | (295,045 | ) | ||||
Interest and dividends received |
150 | 367 | ||||||
Interest paid |
(86 | ) | (86 | ) | ||||
Income taxes paid |
(12,492 | ) | (5,394 | ) | ||||
Cash paid for exit activity |
(119 | ) | (2,243 | ) | ||||
Net cash provided by operating activities |
22,243 | 20,982 | ||||||
Cash flows from investing activities: |
||||||||
Capital expenditures |
(12,034 | ) | (3,386 | ) | ||||
Purchases of investments |
(15,639 | ) | (102,516 | ) | ||||
Sales of investments |
11,745 | 78,266 | ||||||
Proceeds from the sale of property, plant and equipment |
157 | 24 | ||||||
Net cash used in investing activities |
(15,771 | ) | (27,612 | ) | ||||
Cash flows from financing activities: |
||||||||
Cash dividends paid |
(2,303 | ) | (2,303 | ) | ||||
Net cash used in financing activities |
(2,303 | ) | (2,303 | ) | ||||
Net increase (decrease) in cash and cash equivalents |
4,169 | (8,933 | ) | |||||
Cash and cash equivalents at beginning of period |
16,037 | 30,675 | ||||||
Cash and cash equivalents at end of period |
$ | 20,206 | $ | 21,742 |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS, Continued
(In Thousands)
Thirty-Nine Weeks Ended |
||||||||
September 28, 2013 |
September 29, 2012 |
|||||||
Reconciliation of Net Income to Net Cash Provided by Operating Activities: |
||||||||
Net income |
$ | 12,929 | $ | 12,886 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||
Depreciation and amortization |
3,530 | 3,728 | ||||||
Provision for losses on accounts receivable |
18 | 31 | ||||||
Net loss from the disposal of property, plant and equipment |
54 | 149 | ||||||
Realized gain on investments, net |
(17 | ) | 0 | |||||
Amortization of premium on investments |
169 | 297 | ||||||
Stock appreciation rights compensation expense (income) |
3,049 | (234 | ) | |||||
Change in assets and liabilities net of effects from noncash investing and financing activities: |
||||||||
(Increase) decrease in assets: |
||||||||
Accounts receivable |
659 | 238 | ||||||
Inventories |
3,489 | 1,927 | ||||||
Other current assets |
(832 | ) | (657 | ) | ||||
Other assets |
2 | 18 | ||||||
Increase (decrease) in liabilities: |
||||||||
Accounts payable, trade and other current liabilities |
2,762 | 1,145 | ||||||
Income taxes payable |
(3,602 | ) | 3,467 | |||||
Deferred rent |
241 | (605 | ) | |||||
Other liabilities |
(208 | ) | (1,408 | ) | ||||
Net cash provided by operating activities |
$ | 22,243 | $ | 20,982 |
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
ARDEN GROUP, INC. AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. Summary of Significant Accounting Policies
Basis of Presentation and Principles of Consolidation
The condensed consolidated financial statements of Arden Group, Inc. (Company or Arden) include the accounts of the Company and its direct and indirect wholly-owned subsidiaries. All intercompany accounts and transactions are eliminated in consolidation. As of September 28, 2013, the Company operated 16 full-service supermarkets in Southern California through its wholly-owned subsidiary, Gelson’s Markets (Gelson’s) which carries both perishable and other grocery products. On November 7, 2013, Gelson’s opened a new store located in the marina area of Long Beach, California.
The accompanying condensed consolidated financial statements for the thirteen and thirty-nine weeks ended September 28, 2013 and September 29, 2012 have been prepared in accordance with the instructions to Form 10-Q, Article 10 of Regulation S-X and generally accepted accounting principles in the United States (GAAP) for interim financial information. These financial statements have not been audited by an independent registered public accounting firm but include all adjustments which, in the opinion of management of the Company, are necessary for a fair statement of the financial position and the results of operations for the periods presented. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted pursuant to Securities and Exchange Commission (SEC) regulations. Accordingly, the accompanying condensed consolidated financial statements should be read in conjunction with the Company’s fiscal 2012 Annual Report on Form 10-K. The results of operations for the thirty-nine week period ended September 28, 2013 are not necessarily indicative of the results to be expected for the full year ending December 28, 2013.
Revenue Recognition
The Company recognizes revenue at the time of sale. Revenue is recorded net of sales tax. Discounts given to customers are recorded at the point of sale as a reduction of revenue. The Company maintains a bad debt allowance for receivables from vendors and Gelson’s charge card users. Allowances are adjusted periodically based on historical recovery rates. The Company records income from licensing arrangements, subleases, leases and finance charges as they are earned. Income from all licensing arrangements, rental income and finance charges represents less than 1% of sales for all periods presented and, therefore, is not disclosed separately on the Condensed Consolidated Statements of Comprehensive Income.
Cost of Sales
Cost of sales includes product costs (net of discounts and allowances) and inbound freight charges, as well as warehouse, transportation, purchasing, advertising and occupancy costs. Warehouse and transportation costs include receiving costs, internal transfer costs, labor, building rent, utilities, depreciation, repairs and maintenance and fuel for the Company’s distribution center. Purchasing costs include both labor and administrative expense associated with the purchase of the Company’s products for resale. Advertising costs, net of vendor reimbursements, are expensed as incurred. Occupancy costs consist of rent, common area charges (where applicable), depreciation and utilities related to Gelson’s operations. The following table summarizes warehouse, transportation, purchasing, advertising, net of vendor reimbursements, and occupancy costs for the thirteen and thirty-nine weeks ended September 28, 2013 and September 29, 2012:
Thirteen Weeks Ended Thirty-Nine Weeks Ended September 28, 2013 September 29, 2012 September 28, 2013 September 29, 2012 Warehouse and Transportation Purchasing Advertising Occupancy
$
2,007
$
1,849
$
5,703
$
5,301
720
665
2,177
2,053
588
386
1,351
1,372
5,971
5,614
16,962
16,215
$
9,286
$
8,514
$
26,193
$
24,941
Fair Value Measurements
The fair value of the Company’s financial assets and liabilities which are measured on a recurring basis includes Investments which appear under Assets on the Condensed Consolidated Balance Sheets. As of September 28, 2013 and December 29, 2012, all of the Company’s investments were valued using Level 1 inputs as the investment portfolio consists of investment securities that are actively traded in the marketplace. Level 1 inputs are based on quoted prices in active markets for identical assets or liabilities. The carrying values of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate fair value because of the short-term maturity of these instruments.
Vendor Allowances
The Company receives a variety of allowances from its vendors whose products are sold in Gelson’s stores. Typically, the vendors are paying the Company to promote their products. The promotion may be a temporary price reduction, a feature in a print advertisement or newsletter, placement of the vendor’s product in a preferred location in a store or introduction of a new product. The promotions range from approximately two weeks to six months and are recognized as a reduction of cost of sales as they are earned.
Occasionally, the Company receives allowances in the form of upfront lump-sum payments from vendors. Under the terms of these long-term agreements (which typically extend for several months or years), the Company earns these allowances as it purchases product from the vendor. The upfront payments are recorded as a liability when they are received and are recorded as a reduction of inventory cost as the product is purchased. In the event the Company does not purchase the minimum amount of product specified in the agreement, the upfront payments must be returned on a pro rata basis to the vendor. If the contract does not specify that the rebate is earned as product is purchased, then the upfront payments are recorded as a liability when received and recognized as a reduction of cost of sales on a pro rata basis as the product is sold.
2. Multi-Employer Pension and Health Care Plans
The Company contributes to several multi-employer union pension and health care plans, administered by various trustees, in accordance with the provisions of various labor contracts. Pension and health care costs are generally based on the number of straight-time hours worked and the contribution rate per hour as stipulated in the Company’s various collective bargaining agreements. Union pension and health care plan expense totaled approximately $5,387,000 and $5,117,000 in the third quarter of 2013 and 2012, respectively. Contributions were approximately $16,063,000 for the first nine months of 2013 compared to $15,383,000 in the same period of the prior year.
The Arden Group, Inc. 401(k) Plan (Plan) covers all non-union employees of the Company and its subsidiaries who have attained the age of 18 and have completed the applicable service requirement. The Plan provides that, with certain limitations, an employee with at least one month of service may elect to contribute up to 100% of such employee’s annual compensation to the Plan up to a maximum of $17,500 in 2013 on a tax-deferred basis, in addition to catch up contributions up to a maximum of $5,500 for employees over the age of 50. Employees are eligible to participate in the Company’s discretionary contributions beginning on January 1 or July 1 following the completion of one year of service. The Company accrued $129,000 and $95,000 during the third quarter of 2013 and 2012, respectively, for anticipated contributions. The Company accrued $403,000 and $281,000 during the first nine months of 2013 and 2012, respectively.
3. Stock Appreciation Rights
The Company has outstanding stock appreciation rights (SARs) that have been granted to non-employee directors and certain employees. Each SAR entitles the holder to receive cash upon exercise equal to the excess of the fair market value of a share of the Company’s Class A Common Stock (Class A), as determined in accordance with the SARs agreement, on the date of exercise over the grant price. All currently outstanding SARs vest 25% each year beginning at the end of the third year and expire seven years from the date of grant.
The fair value of each SAR is estimated on the date of grant and, subsequently, at the end of each reporting period using the Black-Scholes option-pricing model which relies on the use of various highly subjective assumptions. The assumptions used in the Black-Scholes option-pricing model for the third quarter ended September 28, 2013 were as follows:
Dividend yield |
.69% |
- |
.75% | |
Expected volatility |
26.9% |
- |
30.7% | |
Risk-free interest rate |
.2% |
- |
1.3% | |
Expected average term (years) |
5.29 |
- |
5.45 |
SARs compensation expense must be recognized each reporting period for changes in fair value and vesting. During the third quarter of 2013, the Company recognized $1,939,000 of SARs compensation expense reflecting an increase in the fair value of SARs during the quarter and additional vesting. During the third quarter of 2012, the Company recognized $200,000 of SARs compensation expense. On a year-to-date basis, the Company recognized SARs compensation expense of $3,049,000 for the first nine months of 2013 compared to the reversal of SARs compensation expense of $234,000 during the first nine months of the prior year. SARs compensation expense is recorded in Selling, General and Administrative (SG&A) Expense on the Condensed Consolidated Statements of Comprehensive Income. During the third quarter of 2013, 250 SARs units were exercised with an intrinsic value of approximately $14,158. Intrinsic value represents the amount by which the fair value of SARs on the date of exercise exceeds the base price. During the third quarter of 2013, 2,625 SARs units were forfeited. No SARs units were granted, nor did any expire, during the third quarter of 2013. As of September 28, 2013, assuming no forfeitures or change in the SARs fair value, there was approximately $1,996,000 of total unrecognized compensation cost related to SARs which is expected to be recognized over a weighted average period of approximately 3.0 years. As of September 28, 2013, there were 133,750 SARs units outstanding.
Under the Change in Control Protection Plan (CIC Plan) adopted by the Company (see Note 8 below), under certain circumstances the vesting of SARs units held by employees benefiting from the CIC Plan would accelerate. In addition, upon a change in control, all SARs units held by non-employee directors would automatically vest pursuant to an action taken by the Board of Directors in July 2013.
4. Net Income Per Common Share
Basic net income per common share is computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted net income per common share is determined by dividing net income by the weighted average number of common and potential common shares outstanding during the period. There were no potential common shares outstanding during the periods presented and, therefore, basic and diluted net income per common share are the same.
5. Store Openings and Closings
In September 2012, Gelson’s entered into a lease for a supermarket location in the marina area of Long Beach, California. Gelson’s took possession of the property on March 1, 2013. After extensively remodeling the site, Gelson’s opened a new supermarket at that location on November 7, 2013.
In September 2013, Gelson’s entered into a lease for a supermarket location in La Cañada Flintridge, California. Gelson’s took possession of the property on November 1, 2013 and anticipates opening a new supermarket at that location in February 2014. The remodel and actual opening of the location is subject to, among other things, necessary governmental approvals.
Gelson’s closed its store located in Northridge, California after the close of business on February 25, 2012. Effective March 6, 2012, Gelson’s reached an agreement with the landlord and a third party to assign the lease of the Northridge store to the third party. Gelson’s rent and all other obligations under the lease agreement ended May 1, 2012. In accordance with the assignment of the lease, various items of equipment were transferred by Gelson’s to the assignee and Gelson’s paid the assignee a lease assignment fee of $1,850,000 during the second quarter of 2012. In addition, Gelson’s incurred other closing costs of approximately $393,000 during fiscal 2012 to transfer excess product and supplies to other Gelson’s locations, to write off product which could not be transferred, to shut down and relocate or write off equipment and to maintain the store until Gelson’s was released from its lease obligation. Anticipated exit activity costs were recorded on the Condensed Consolidated Statement of Comprehensive Income in the line titled Loss (Gain) from Exit Activity during 2012. These costs were net of the reversal in 2012 of a deferred rent liability of $331,000 previously recorded for the Northridge location.
On March 18, 2013, the Company announced its decision to terminate the lease for its Gelson’s location in Pasadena, California in accordance with the lease terms. The store was closed on June 15, 2013, and Gelson’s rent and all other obligations under the lease agreement ended July 21, 2013. Gelson’s transferred some of the fixtures and equipment from the Pasadena location to the new Long Beach store discussed above. Gelson’s has recorded closing costs of approximately $121,000 to transfer excess product and supplies to other Gelson’s locations, to write off product which could not be transferred, to shut down and relocate or dispose of equipment and to maintain the store until Gelson’s was released from its lease obligation. These closing costs are included in the Loss (Gain) from Exit Activity line on the Condensed Consolidated Statement of Comprehensive Income.
6. Commitments and Contingent Liabilities
The Company and its subsidiaries are subject to a myriad of environmental laws, regulations and lease covenants with its landlords regarding air, water and land use, products for sale, and the use, storage and disposal of hazardous materials. The Company believes it substantially complies, and has in the past substantially complied, with applicable federal, state and local environmental laws and regulations and private covenants. The Company cannot, at this time, estimate the expense it ultimately may incur in connection with any current or future violations; however, it believes any such claims will not have a material effect upon either the Company’s consolidated financial position, results of operations or cash flows.
The Company and its subsidiaries are defendants in a number of cases currently in litigation, being vigorously defended, in which the complainants seek monetary damages. As of the date hereof, no estimate of potential liability, if any, is possible. Based upon current information, management, after consultation with legal counsel defending the Company’s interests in the cases, believes the ultimate disposition thereof will have no material effect upon either the Company’s consolidated financial position, results of operations or cash flows.
In September 2012, Gelson’s entered into a lease for a supermarket location in Long Beach, California. The terms of the lease required Gelson’s to extensively remodel the existing store in 2013. In addition, Gelson’s has committed to remodeling the exterior of its Sherman Oaks location.
7. Recent Accounting Standards
In February 2013, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2013-02, “Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income.” This amendment does not change the current requirements for reporting net income or other comprehensive income in financial statements; however, the amendment requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component and to disclose significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income if the amount being reclassified is required under GAAP to be reclassified in its entirety to net income. For other amounts that are not required under GAAP to be reclassified in their entirety to net income in the same reporting period, an entity is required to cross-reference other disclosures required under GAAP. The pronouncement was effective for reporting periods beginning after December 15, 2012. The adoption of ASU 2013-02 in the first quarter of 2013 had no impact on the Company’s consolidated financial statements.
8. Strategic Alternatives
On July 15, 2013, the Company announced that its Board of Directors had initiated a process to explore and evaluate strategic alternatives, which may include a possible sale of the Company. The Company has retained Moelis & Company as its exclusive financial adviser to assist the Company in connection with the strategic review process. The Company has not made a decision to pursue any specific strategic transaction or any other strategic alternative, and there is no defined timeline for this strategic review. There can be no assurance that the review of strategic alternatives will result in the consummation of any transaction. The Company does not intend to comment further regarding the evaluation of strategic alternatives until such time as the Company’s Board of Directors has determined that further disclosure is appropriate or required.
In connection with the decision to explore strategic alternatives, the Board of Directors adopted the Arden Group, Inc. CIC Plan to ensure a smooth transition in the event a qualifying change in control is consummated (Change in Control). Under the CIC Plan, certain employees of Arden and Gelson’s are eligible to receive various retention and/or severance benefits upon or after a Change in Control. Under certain circumstances, the vesting of those employees’ SARs units would accelerate upon a Change in Control. Employees eligible to participate in the CIC Plan must enter into a letter agreement with the Company that sets forth the terms, conditions and amount of the participant’s CIC Plan benefits. Subject to the terms and conditions of the CIC Plan, upon a Change in Control, a participant under the CIC Plan who remains employed through the date of the Change in Control or who is terminated without cause or resigns for good reason prior thereto would be eligible to receive retention payments. Beginning 30 days prior to a Change in Control and for one year thereafter, if a participant is terminated without cause or resigns for good reason, the participant would receive specified severance benefits. The Company’s obligation to provide each of the retention and/or severance benefits under the CIC Plan is conditioned upon the participant providing a general release of claims and complying with certain nondisclosure covenants.
9. Subsequent Events
On October 18, 2013, the Company paid a regular quarterly cash dividend of $0.25 per share on Class A totaling approximately $768,000 to stockholders of record on September 27, 2013.
On November 7, 2013, Gelson’s opened a new store located in the marina area of Long Beach, California.
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by or on behalf of the Company. Certain statements contained in Management’s Discussion and Analysis of Financial Condition and Results of Operations, other parts of this report and other Company filings are forward-looking statements. These statements discuss, among other things, future sales, operating results, cash flows and financial condition. Such statements may be identified by such words as “anticipate,” “expect,” “may,” “believe,” “could,” “estimate,” “project,” “maybe,” “appears,” “intend,” “plan” and similar words or phrases. Forward-looking statements reflect the Company’s current plans and expectations regarding important risk factors and are based on information currently available to us. The Company cautions readers that any forward-looking statements contained in this report or made by the management of the Company involve risks and uncertainties, and are subject to change based on various important factors. In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, “Item 1A. Risk Factors,” in the Company’s Annual Report on Form 10-K for the year ended December 29, 2012. The risks described in the Company’s Annual Report on Form 10-K are not the only risks it faces. Additional risks and uncertainties not currently known to the Company or that it currently deems to be not material could also have an adverse effect on the Company’s future sales, operating results, cash flows or financial position. The Company does not undertake any obligation to update forward-looking statements.
Critical Accounting Policies
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions about future events that may affect the reported amounts of assets, liabilities, revenues and expenses, as well as the disclosure of contingent assets and liabilities. Management has established accounting policies that they believe are appropriate in order to reflect the accurate reporting of the Company’s operating results, financial position and cash flows. The Company applies these accounting policies in a consistent manner. Management bases their estimates on historical experience, current and expected economic conditions and various other factors that management believes to be reasonable under the circumstances. These estimates and assumptions form the basis for making judgments about various aspects of the Company’s business, including the carrying values of assets and liabilities that are not readily apparent from other sources. The Company reevaluates these significant factors and makes adjustments where facts and circumstances dictate. Future events and their effects cannot be determined with absolute certainty, and therefore actual results may differ from estimates. As discussed in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s Annual Report on Form 10-K for the fiscal year ended December 29, 2012, management considers its policies on accounting for inventories and cost of sales, impairment of long-lived assets, insurance reserves, vendor allowances and share-based compensation to be the most critical in the preparation of the Company’s financial statements because they involve the most difficult, subjective or complex judgments about the effect of matters that are inherently uncertain.
Overview
Arden is a holding company which conducts operations through its first and second tier wholly-owned subsidiaries, Arden-Mayfair, Inc. and Gelson’s, respectively, as well as owning and managing its own real estate through Mayfair Realty, Inc. which is wholly-owned by the Company and Arden-Mayfair, Inc. As of December 31, 2011, Gelson’s operated 18 full-service supermarkets in Southern California. As described below, on February 25, 2012 and June 15, 2013, the Gelson’s stores in Northridge and Pasadena, respectively, were closed, reducing the number of supermarkets operated by Gelson’s to 16. The Company opened a new store in Long Beach, California on November 7, 2013, increasing the number to 17. In addition, the Company plans to open a new store in La Cañada Flintridge in February 2014.
Gelson’s caters to those customers who expect superior quality, service and merchandise selection. In addition to the customary supermarket offerings, Gelson’s offers specialty items such as imported foods, unusual delicatessen items, prepared foods and organic and natural food products. Gelson’s stores include the typical service departments such as meat, seafood, service deli, floral, sushi, cheese and bakery. In addition, some stores offer further services including fresh pizza, coffee bars, self-service hot and cold food cases, gelato bars and carving carts offering cooked meats.
The Company’s management focuses on a number of performance indicators in evaluating financial condition and results of operations. Same store sales, transaction count, gross profit and labor costs are some of the key factors that management considers. Both sales and gross profit are significantly influenced by competition in our trade area. Gelson’s faces competition from regional and national supermarket chains (most of which have greater resources and a larger market share than Gelson’s), stores specializing in natural and organic foods, specialty and gourmet markets and grocery departments in mass merchandise and club stores. Weak economic conditions have led to an even more competitive market in the grocery industry in recent years. As discretionary income declined, some consumers have reduced their spending and are making more price conscious decisions which has caused us to compete for fewer customer dollars and offer more promotional discounts as our competitors have also done.
Labor and other related payroll costs are the second largest expense (after product cost) incurred by Gelson’s and thus is a financial measure which is closely monitored by management. As of fiscal 2012 year-end, Gelson’s had approximately 1,135 full-time and 953 part-time store, warehouse and office employees. The majority of Gelson’s employees are members of the United Food & Commercial Workers International Union (UFCW). Gelson’s current contract with the UFCW, which expires on March 2, 2014, provided for bonuses in lieu of wage increases within 30 days following ratification in October 2011 and again in March 2013 for employees at certain experience levels. The contract also provided for wage increases for certain classes of employees in March 2012. The agreement that the three major grocery retailers in our trade area – Vons, Ralphs and Albertsons grocery chains (Majors) – reached with the UFCW provides for hourly wage rates based on job classification and experience that, in some cases, are less than those agreed to by Gelson’s.
The Company contributes to multi-employer health care and pension plan trusts on behalf of its employees who are members of the UFCW. All employers who participate in the UFCW multi-employer plans are required to contribute at the same hourly rate based on straight-time hours worked in order to fund the plans. The Company’s health and welfare contribution rate increased effective the beginning of March 2012 and March 2013 in accordance with the UFCW collective bargaining agreement. As a result, average weekly health and welfare expense increased on each of these dates by approximately $15,000. A one-time surcharge of approximately $136,000 was paid in both March 2012 and March 2013 and an additional surcharge of $272,000 is due in February 2014. With respect to the pension plan, a rate increase became effective October 2012 resulting in an increase in expense of approximately $5,000 per week. A similar increase in the pension contribution rate occurred effective October 2013. The increase in health and welfare and pension costs, as well as the labor cost issue discussed above, has negatively impacted the Company’s profitability and will continue to unless the Company is able to continue offsetting the increased expense through a combination of sales growth, increased gross margin, reduced labor hours and cost savings in other areas. In addition, the most recently available certified zone status provided by the pension plan trust indicates that the pension plan was in critical status (less than 65 percent funded) as defined by the Pension Protection Act of 2006 for the year ended March 31, 2012. A rehabilitation plan has been implemented by the plan trustee which includes a schedule of benefit cuts and contribution rate increases that allows for projected emergence from critical status at the end of the rehabilitation period on March 31, 2024. However, if the funded status of the plan deteriorates or if the rehabilitation plan is unsuccessful or if any of the participating employers in the plan withdraws from the plan due to insolvency and is not able to contribute an amount sufficient to cover the underfunded liabilities associated with its participants, the Company may be required to negotiate with the union for additional contributions in the future.
The Company’s current and prior quarterly results have frequently reflected fluctuations in operating income as a result of adjustments recorded to reflect the change in the fair value of SARs that have been granted to non-employee directors and certain employees. Each SAR entitles the holder to receive cash upon exercise equal to the excess of the fair market value of a share of the Company’s Class A, as determined in accordance with the SARs agreement, on the date of exercise over the grant price. Fluctuations in the market price of the Company’s Class A impact the recognition or reversal of SARs compensation expense in the period being reported upon. Since the Company cannot predict future fluctuations in the market price of its stock, it also cannot forecast future SARs compensation expense adjustments and the extent to which operating income will be impacted. Volatility in the stock market makes this difficult to predict. Under the CIC Plan, discussed below, and under the amendments to the Directors’ Phantom Stock Unit Agreements, vesting of SARs units may accelerate in the event of a Change in Control.
Gelson’s closed its store located in Northridge, California after the close of business on February 25, 2012. Effective March 6, 2012, Gelson’s reached an agreement with the landlord and a third party to assign the lease of the Northridge store to the third party. Gelson’s rent and all other obligations under the lease agreement ended May 1, 2012. In accordance with the assignment of the lease, various items of equipment were transferred by Gelson’s to the assignee and Gelson’s paid the assignee a lease assignment fee of $1,850,000 during the second quarter of 2012. In addition, Gelson’s incurred other closing costs to transfer excess product and supplies to other Gelson’s locations, to write off product which could not be transferred, to shut down and relocate or write off equipment and to maintain the store until Gelson’s was released from its lease obligation. Other closing costs totaled approximately $393,000 during fiscal 2012. Anticipated exit activity costs were recorded during 2012 on the Condensed Consolidated Statement of Comprehensive Income in the line titled Loss (Gain) from Exit Activity. These costs were net of the reversal in 2012 of a deferred rent liability of $331,000 previously recorded for the Northridge location.
In September 2012, Gelson’s entered into a lease for a supermarket location in the marina area of Long Beach, California. Gelson’s took possession of the property on March 1, 2013. After extensively remodeling the site, Gelson’s opened a new supermarket at that location on November 7, 2013.
On March 18, 2013, the Company announced its decision to terminate the lease for its Gelson’s location in Pasadena, California in accordance with the lease terms. The store was closed on June 15, 2013 and Gelson’s rent and all other obligations under the lease agreement ended July 21, 2013. Gelson’s transferred some of the fixtures and equipment from the Pasadena location to the new Long Beach store discussed above. Gelson’s has recorded closing costs of approximately $121,000 to transfer excess product and supplies to other Gelson’s locations, to write off product which could not be transferred, to shut down and relocate or dispose of equipment and to maintain the store until Gelson’s was released from its lease obligation. These closing costs are included in the Loss (Gain) from Exit Activity line on the Condensed Consolidated Statement of Comprehensive Income.
In September 2013, Gelson’s entered into a lease for a supermarket location in La Cañada Flintridge, California. Gelson’s took possession of the property on November 1, 2013 and anticipates opening a new supermarket at that location in February 2014. The remodel and actual opening of the location is subject to, among other things, necessary governmental approvals.
On July 15, 2013, the Company announced that its Board of Directors had initiated a process to explore and evaluate strategic alternatives, which may include a possible sale of the Company. The Company has retained Moelis & Company as its exclusive financial adviser to assist the Company in connection with the strategic review process. The Company has not made a decision to pursue any specific strategic transaction or any other strategic alternative, and there is no defined timeline for this strategic review. There can be no assurance that the review of strategic alternatives will result in the consummation of any transaction. The Company does not intend to comment further regarding the evaluation of strategic alternatives until such time as the Company’s Board of Directors has determined that further disclosure is appropriate or required.
In connection with the decision to explore strategic alternatives, the Board of Directors adopted the Arden Group, Inc. CIC Plan to ensure a smooth transition in the event a Change in Control is consummated. Under the CIC Plan, certain employees of Arden and Gelson’s are eligible to receive various retention and/or severance benefits upon or after a Change in Control. Under certain circumstances, the vesting of those employees’ SARs units would accelerate upon a Change in Control. Employees eligible to participate in the CIC Plan must enter into a letter agreement with the Company that sets forth the terms, conditions and amount of the participant’s CIC Plan benefits. Subject to the terms and conditions of the CIC Plan, upon a Change in Control, a participant under the CIC Plan who remains employed through the date of the Change in Control or who is terminated without cause or resigns for good reason prior thereto would be eligible to receive retention payments. Beginning 30 days prior to a Change in Control and for one year thereafter, if a participant is terminated without cause or resigns for good reason, the participant would receive specified severance benefits. The Company’s obligation to provide each of the retention and/or severance benefits under the CIC Plan is conditioned upon the participant providing a general release of claims and complying with certain nondisclosure covenants.
Results of Operations
Third Quarter Analysis
Same store sales from the Company’s 16 supermarkets were $111,068,000 during the third quarter of 2013 compared to $104,709,000 in the third quarter of 2012. The 6.1% increase in same store sales is due to an increase in the number of transactions in the third quarter of 2013 compared to the same period of the prior year, as well as inflation.
The Company’s gross profit as a percent of sales was 38.0% in the third quarter of 2013 compared to 38.6% in the same period of 2012. In calculating gross profit, the Company deducts product costs (net of discounts and allowances) and inbound freight charges, as well as warehouse, transportation, purchasing, advertising and occupancy costs. Gross profit as a percent of sales for the Company may not be comparable to those of other companies in the grocery industry since there may be differences in recording certain costs as cost of sales or as SG&A expense.
SG&A expense, excluding the Loss (Gain) from Exit Activities discussed above, as a percent of sales was 32.4% in the third quarter of 2013 compared to 30.7% in the same period of 2012. The increase in SG&A expense as a percent of sales is primarily due to an increase in SARs compensation expense in the third quarter of 2013 compared to the same period of the prior year principally resulting from the increase in the price of the Company’s Class A. The Company recorded SARs compensation expense of approximately $1,939,000 in the third quarter of 2013 as the result of an increase in SARs fair value since the beginning of the quarter and additional vesting. In comparison, the Company recognized approximately $200,000 of SARs compensation expense in the third quarter of 2012. SG&A expense in the third quarter of 2013 was also negatively impacted by an increase in worker’s compensation premiums effective July 1, 2013 and an increase in UFCW health and welfare and pension contribution rates as discussed above partially offset by a reduction in labor dollars as a percent of sales. In addition, the increase in SG&A expense as a percent of sales was partially offset by an increase in sales without a comparable increase in expense as some costs do not increase at the same rate as sales.
Year-To-Date Analysis
Same store sales from the Company’s 16 supermarkets (excluding the Northridge and Pasadena locations which were closed February 25, 2012 and June 15, 2013, respectively), were $329,118,000 during the first nine months of 2013. This represents an increase of 5.8% from the same period of the prior year, when same store sales were $311,003,000. The increase in sales is due to an increase in the number of transactions in the first nine months of 2013 compared to the same period of the prior year, as well as inflation.
The Company’s gross profit as a percent of sales was 38.2% in the first nine months of 2013 compared to 38.2% in the same period of 2012. In calculating gross profit, the Company deducts product costs (net of discounts and allowances) and inbound freight charges, as well as warehouse, transportation, purchasing, advertising and occupancy costs. Gross profit as a percent of sales for the Company may not be comparable to those of other companies in the grocery industry since there may be differences in recording certain costs as cost of sales or as SG&A expense.
SG&A expense, excluding the Loss (Gain) from Exit Activity discussed above, as a percent of sales was 31.6% in the first nine months of 2013 compared to 30.9% in the same period of 2012. The increase in SG&A expense as a percent of sales is primarily due to an increase in SARs compensation expense in the first nine months of 2013 compared to the same period of the prior year principally resulting from the increase in the price of the Company’s Class A. The Company recorded SARs compensation expense of approximately $3,049,000 in the first nine months of 2013 as the result of an increase in SARs fair value since the beginning of the year and additional vesting. In comparison, during the first nine months of 2012, the Company reversed approximately $234,000 of SARs compensation expense recognized in prior periods. SG&A expense in the first nine months of 2013 was also negatively impacted by an increase in UFCW health and welfare and pension contribution rates as discussed above partially offset by a reduction in labor dollars as a percent of sales. In addition, the increase in SG&A expense as a percent of sales was partially offset by an increase in sales without a comparable increase in expense as some costs do not increase at the same rate as sales.
CAPITAL EXPENDITURES/LIQUIDITY
The Company’s current cash position, including short-term investments and net cash provided by operating activities, is the primary source of funds available to meet the Company’s capital expenditure and liquidity requirements. The Company’s cash position, including short-term investments, at the end of the third quarter of 2013 was $25,716,000. During the thirty-nine weeks ended September 28, 2013, the Company generated $22,243,000 of cash from operating activities compared to $20,982,000 in the same period of 2012.
Cash not required for the immediate needs of the Company is temporarily invested in U.S. Treasuries, certificates of deposit, money market funds, commercial paper, mutual funds and corporate and government securities. The Company is continually investigating opportunities for the use of these funds including new locations and the expansion and remodel of existing stores. In September 2012, Gelson’s entered into a lease for a Gelson’s supermarket location in Long Beach, California. Gelson’s took possession of the property on March 1, 2013. After extensively remodeling the site, Gelson’s opened a new supermarket at that location on November 7, 2013. In September 2013, Gelson’s entered into a lease for a supermarket location in La Cañada Flintridge, California. Gelson’s took possession of the property on November 1, 2013 and, after some remodeling, anticipates opening the store in February 2014. In addition, Gelson’s has committed to remodeling the exterior of its Sherman Oaks location.
The Company has an unsecured revolving line of credit facility available for standby letters of credit, funding operations and expansion. The credit agreement provides for borrowings and/or letters of credit up to an aggregate principal amount at any one time of $25,000,000 and expires on June 1, 2014. There were no outstanding borrowings against the revolving line of credit as of September 28, 2013. The Company currently maintains four standby letters of credit aggregating $7,394,000 as of September 28, 2013 in connection with lease and self-insurance requirements.
The following table sets forth the Company’s contractual cash obligations and commercial commitments as of September 28, 2013:
Contractual Cash Obligations (In Thousands) |
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5 Years |
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7% Subordinated Income Debentures |
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Due September 2014 Including Interest |
$ | 1,314 | $ | 1,314 | $ | 0 | $ | 0 | $ | 0 | ||||||||||
Operating Leases |
148,651 | 11,659 | 22,852 | 21,032 | 93,108 | |||||||||||||||
Total Contractual Cash Obligations (1) |
$ | 149,965 | $ | 12,973 | $ | 22,852 | $ | 21,032 | $ | 93,108 |
Other Commercial Commitments (In Thousands) |
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After |
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Total |
1 Year |
1-3 Years |
4-5 Years |
5 Years |
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Standby Letters of Credit (2) |
$ | 7,394 | $ | 7,394 | $ | 0 | $ | 0 | $ | 0 |
(1) |
Other Contractual Obligations |
The Company had the following other contractual cash obligations at September 28, 2013. The Company is unable to include these liabilities in the tabular disclosure of contractual cash obligations as the exact timing and amount of payments are unknown.
Self-Insurance Reserves
The Company is primarily self-insured for losses related to general and auto liability claims and for all open years prior to July 1, 2006 for worker’s compensation. The Company maintains stop-loss coverage to limit its loss exposure on a per claim basis. Effective July 1, 2006, the Company purchased a fully insured guaranteed cost worker’s compensation insurance policy for losses occurring after June 30, 2006. This policy replaced the high deductible program for worker’s compensation. Liabilities associated with the risks that are retained by the Company under the high deductible programs are estimated, in part, by considering historical claims experience and regression analysis. Accruals are based on undeveloped reported claims and an estimate of claims incurred but not reported. While the ultimate amount of claims incurred is dependent on future developments, in management’s opinion recorded reserves are adequate to cover the future payment of claims. The Company’s reserve for unpaid and incurred but not reported claims at September 28, 2013 was approximately $1,670,000.
Property, Plant and Equipment Purchases
The Company has an ongoing program to remodel existing supermarkets and to add new stores. During the first nine months of 2013, capital expenditures were $12,034,000. As of September 28, 2013, management had authorized future expenditures on incomplete projects for the purchase and remodel of property, plant and equipment which totaled approximately $9,360,000 which includes a portion of the remodeling expenditures for the new store in Long Beach and anticipated remodeling expenditures for the new store in La Cañada Flintridge, California, as discussed above.
(2) |
Standby Letters of Credit |
The Company’s letters of credit renew automatically each year unless the issuer notifies the Company otherwise. The amount of each outstanding letter of credit held pursuant to the Company’s worker’s compensation and general and auto liability insurance programs is adjusted annually based upon the outstanding claim reserves as of the renewal date. Each letter of credit obligation related to insurance will cease when all claims for the particular policy year are closed or the Company negotiates a release. The amount of another letter of credit related to one of the Company’s leases is adjusted periodically in accordance with the lease.
The Company has a stock repurchase program, authorized by the Board of Directors, to purchase shares of its Class A in the open market or in private transactions from time to time. The timing, volume and price of purchases are at the discretion of the management of the Company. There are currently 132,806 shares of Class A authorized for repurchase. No stock was repurchased under this program during the third quarter of 2013.
On October 18, 2013, the Company paid a regular quarterly cash dividend of $0.25 per share of Class A totaling approximately $768,000 to stockholders of record as of September 27, 2013.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company currently has no outstanding bank debt or fixture financing. If the Company should borrow in the future, the Company could then be exposed to market risk related to interest fluctuations.
A change in market prices exposes the Company to market risk related to its investments. As of September 28, 2013, all investments were classified as available-for-sale securities and totaled $5,510,000. A hypothetical 10% drop in the market value of these investments would result in a $551,000 unrealized loss and a corresponding decrease in the fair value of these instruments. This hypothetical drop would not affect cash flow and would not have an impact on earnings until the Company sold the investments.
The Company has employed what it believes to be a conservative investment strategy. The Company chooses what it believes are low risk investments with high credit, quality institutions.
ITEM 4. CONTROLS AND PROCEDURES
An evaluation was carried out by the Company’s Chief Executive Officer and the Chief Financial Officer of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) as of September 28, 2013. Based upon that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that these disclosure controls and procedures were effective.
Management, with the participation of the Chief Executive Officer and the Chief Financial Officer of the Company, has evaluated any changes in the Company’s internal control over financial reporting that occurred during the most recent fiscal quarter. Based on that evaluation, management, the Chief Executive Officer and the Chief Financial Officer of the Company have concluded that there has been no change in the Company’s internal control over financial reporting during the Company’s fiscal quarter ended September 28, 2013 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.
PART II. OTHER INFORMATION
ITEM 1A. RISK FACTORS
There have been no material changes in our risk factors from those disclosed in our 2012 Annual Report on Form 10-K.
ITEM 6. EXHIBITS
10.1 |
Arden Group, Inc. Change in Control Protection Plan and Summary Plan Description dated July 12, 2013 which includes Form of Letter Agreement. |
10.2 |
Form of Amendment to Non-Employee Director Phantom Stock Unit Agreement with each of M. Mark Albert, John G. Danhakl, Robert A. Davidow, Kenneth A. Goldman and Steven Romick dated July 12, 2013. |
31.1 |
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
31.2 |
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
32.1 |
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
32.2 |
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
101.INS* |
XBRL Instance |
101.SCH* |
XBRL Taxonomy Extension Schema |
101.CAL* |
XBRL Taxonomy Extension Calculation |
101.DEF* |
XBRL Taxonomy Extension Definition |
101.LAB* |
XBRL Taxonomy Extension Labels |
101.PRE* |
XBRL Taxonomy Extension Presentation |
* |
XBRL information is furnished and not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
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ARDEN GROUP, INC. |
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Registrant |
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Date: |
November 7, 2013 |
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/s/LAURA J. NEUMANN |
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Laura J. Neumann |
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Chief Financial Officer |
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(Authorized Signatory) |
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