================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Act of 1934
Date of Report (Date of earliest event reported): November 13, 2006
WILD OATS MARKETS, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-21577 84-1100630
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File Number) Identification Number)
3375 Mitchell Lane
Boulder, Colorado 80301
(Address of principal executive offices, including zip code)
(303) 440-5220
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13a-4(c))
================================================================================
ITEM 2.05 COSTS ASSOCIATED WITH EXIT OR DISPOSAL ACTIVITIES
On November 13, 2006, the board of directors of Wild Oats Markets,
Inc., a Delaware corporation (the "Registrant"), decided to close an aggregate
of eight currently operating stores: (a) five stores operated under the Henry's
Farmers Market banner located in Phoenix, Arizona, and (b) three stores operated
under the Wild Oats Market banner and located in Omaha, Nebraska, Salt Lake
City, Utah, and Fort Collins, Colorado. The Registrant anticipates that the
store closures will be completed by December 16, 2006. The Registrant also has
decided not to open one store under development in metropolitan Phoenix,
Arizona. Additionally, the Registrant has impaired the operating assets to the
expected net realizable value for two underperforming stores in other markets,
one of which will close when its lease expires in 2007. The decision to close
the identified stores was made after the Registrant concluded that seven of the
identified stores had or would under-perform in relation to expected sales, and
that the other two stores, which are much older, in less defensible locations
and were impacted by subsequent competition, were unlikely to show significant
improvement in cash flows within an acceptable time frame.
The Registrant expects to incur an estimated $25.5 million charge in
the fourth fiscal quarter of 2006 to pre-tax earnings as follows:
Charge
Type of Cost (in millions)
------------------------------------------------- -------------
Asset impairment charges $ 13.8
Lease-related liabilities 11.2
Severance for employees terminated during the
fourth quarter of fiscal 2006 0.5
=============
Total estimated restructuring and asset
impairment charges $ 25.5
In addition to the restructuring charges reflected above, the
Registrant expects to incur an estimated $1.7 million in incremental operating
costs in the fourth fiscal quarter of 2006 resulting from the store closure plan
described above.
Risk Factors and Uncertainties
This report contains forward-looking statements, as defined in the
Private Securities Litigation Reform Act of 1995, which involve risks and
uncertainties. Such forward-looking statements include the anticipated
performance of stores, expected future financial measures and prospects for
favorable growth and performance. The statements made by the Registrant are
based on management's present expectations, and actual results may differ from
the results indicated or otherwise implied by such forward-looking statements
due to certain risks and uncertainties including, but not limited to: the
Registrant's ability to execute, the results of merchandising and marketing
programs, the impact of competition and other factors as are set forth in the
Registrant's SEC filings, including the Annual Report on Form 10-K for the
fiscal year ended December 31, 2005 and the Registrant's quarterly reports on
Form 10-Q. These risk factors may not be an all-inclusive enumeration of the
business risks faced by the Registrant. Investors should recognize that the
reliability of any projected financial data diminishes the farther in the future
the data is projected.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS
(d) Exhibits.
The following is furnished as an exhibit to this current report on Form 8-K:
Exhibit 99.1 Press Release of Wild Oats Markets, Inc. dated November 14, 2006.
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, hereunto duly authorized.
Wild Oats Markets, Inc.
(Registrant)
By: /s/ Freya R. Brier
---------------------------
Freya R. Brier
Date: November 14, 2006 Executive Officer
EXHIBIT INDEX
Exhibit No. Description
------------ -----------------------------------------------------------------
Exhibit 99.1 Press Release of Wild Oats Markets, Inc. dated November 14, 2006.