Green Mountain, which produces coffee and the Keurig single-cupcoffee maker, saw its stock lose roughly half its value last weekafter the company lowered its profit forecast due to slower salesgrowth. That followed a fall earlier this year after rival Starbucks Corp. announced plans to introduce its own single-cup brewing machine intime for the holiday season. Stiller said he received a call from Deutsche Bank on Friday about an hour and a half before the market closed,telling him that he needed to come up with cash or sell shares. “They changed what they would lend to me from 60 percent to 30percent,” Stiller said.
He liquidated his other positions, including his stake in KrispyKreme, as a result. A filing with the Securities and Exchange Commission on Wednesday shows Stiller sold his 8 million shares of thedoughnut chain at a price of $6.15 each. Stiller was thesecond-largest shareholder of Krispy Kreme, according to FactSet . A representative for Krispy Kreme could not immediately bereached. Stiller, who founded Green Mountain in 1981 and served as itspresident and CEO until May 2007, noted that he is retired and thathis stock portfolio is his main source of income.
As for reportsthat he leads a lavish lifestyle, he said he bought a yacht fiveyears ago because he enjoys traveling and being on the water withfriends. “Maybe I shouldn’t do these things, but I’ve worked all mylife building this company and it’s been successful,” saidStiller, 68. “I want to enjoy it. Whether it’s livinglavishly, I think that’s all relative.” On Tuesday, Green Mountain said it was removing Stiller and leaddirector William Davis from their leadership roles and suspending their pay indefinitelybecause of stock sales that violated company policy. Volvo Turbo Kits
Both men hadfaced margin calls because of the drop in stock price, whichsubsequently forced them sell a total of more than 5.5 millionshares. In 2011, Stiller received compensation worth $175,296 for sittingon the board, including option awards worth $74,296 and $50,000 infees for serving as chairman, according to Green Mountain’s proxyfiling with regulators in February. Davis received cash-and-stockcompensation of $164,296 for the year, including lead director feesof $15,000. Although Green Mountain bars individuals with inside informationfrom trading its stock during certain periods, Stiller said thecompany was aware that his stock served as collateral in a marginaccount. Green Mountainhas said it is requiring Stiller and Davisto settle all their outstanding margin loans by the end of thisyear. China VNT Turbo Controller
Green Mountain said Wednesday that no other senior executives havemargin accounts. The Waterbury , Vt.-based company’s internal trading policy was revised inDecember of last year to prohibit margin accounts, pledges ofshares or similar transactions. Stiller and Davis were allowed toretain certain margin accounts that were in place before the banwent into effect. Stiller now owns roughly 8.34 million Green Mountain shares, thecompany said. If he sold all the stock in his margin accounts, hisstake would shrink to about 1.9 million shares. CAT Turbocharger Manufacturer
Davis owns 436,786shares, and his stake would shrink to 36,598 in that scenario. Shares of Krispy Kreme rose 32 cents, or 5 percent, to finish at$6.67. Green Mountain shares fell 11 cents to close at $26.27. Thestock is now down over 77 percent since reaching its year-high of$115.98 last September.