Einstein Bros 2004 Annual Report Download - page 29

http://www.sec.gov/Archives/edgar/data/949373/000104746905006202/a2153240z10-k.htm[9/11/2014 10:13:29 AM]
approximately 97 percent of our common stock and sales by Greenlight or a perception that Greenlight will sell could cause a decrease in the
market price of our common stock. Additionally, holders of outstanding warrants may convert and sell the underlying shares in the public market.
Pursuant to our obligations under registration rights agreements, we have registered 957,872 shares of common stock underlying certain warrants,
of which Greenlight owns warrants to purchase approximately 493,683 shares of our common stock. Sales of shares or a perception that there will
be sales of the underlying shares could also cause a decrease in the market price of our common stock.
Holders may find it difficult to effect transactions in our common stock.
Our common stock is currently quoted on the "pink sheets" under the symbol "NWRG.PK." Before changing our symbol on October 20, 2003,
our common stock was quoted on the "pink sheets" under the symbol "NWCI.PK." Since our common stock is not listed on Nasdaq, the American
Stock Exchange or the New York Stock Exchange, holders of our common stock may find that the liquidity of our common stock is impaired—not
only in the number of securities that can be bought and sold, but also through delays in the timing of transactions, reduction in security analysts'
and the news media's coverage of us, and lower prices for our securities than might otherwise be attained.
Securities that are not listed on a stock exchange, the Nasdaq National Market or the Nasdaq SmallCap Market are subject to an SEC rule that
imposes special requirements on broker-dealers who sell those securities to persons other than their established customers and accredited investors.
The broker-dealer must determine that the security is suitable for the purchaser and must obtain the purchaser's written consent prior to the sale.
These requirements may make it more difficult for stockholders to sell our stock than the stock of some other companies. It may also affect our
ability to raise more capital if and when necessary.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
For the fiscal years ended 2004 and 2003, our results of operations, financial position and cash flows have not been materially affected by
changes in the relative values of non-U.S. currencies to the U.S. dollar. We do not use derivative financial instruments to limit our foreign
currency risk exposure since virtually all of our business is conducted in the United States.
Our debt as of December 28, 2004 and December 30, 2003 is principally comprised of the $160 Million Notes due July 1, 2008 and the
AmSouth Revolver. A 100 basis point increase in market interest rates would have an immaterial effect on our borrowing costs, since the interest
rate on the $160 Million Notes is fixed. The interest rate on the AmSouth Revolver fluctuates with changes in the prime rate, but is immaterial in
relation to interest expense under the $160 Million Notes and in our results of operations and financial condition.
We purchase certain commodities such as butter, cheese, coffee and flour. These commodities are generally purchased based upon market
prices established with vendors. These purchase arrangements may contain contractual features that limit the price paid by establishing certain
price floors or caps. We do not use financial instruments to hedge commodity prices because these purchase arrangements help control the ultimate
cost paid and any commodity price aberrations are generally short-term in nature.
This market risk discussion contains forward-looking statements. Actual results may differ materially from this discussion based upon general
market conditions and changes in domestic and global financial markets.
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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Audited Annual Financial Statements
Report of Independent Registered Public Accounting Firm
Consolidated Balance Sheets as of December 28, 2004 and December 30, 2003 (restated)
Consolidated Statements of Operations for the Years Ended December 28, 2004, December 30, 2003
(restated) and December 31, 2002 (restated)
Consolidated Statements of Changes in Stockholders' Equity (Deficit) for the Years Ended
December 28, 2004, December 30, 2003 (restated) and December 31, 2002 (restated)
Consolidated Statements of Cash Flows for the Years Ended December 28, 2004, December 30, 2003
(restated) and December 31, 2002 (restated)
Notes to Consolidated Financial Statements