Annual report pursuant to section 13 and 15(d)

Subsequent Events

Subsequent Events
12 Months Ended
Sep. 30, 2013
Subsequent Events [Abstract]  
Subsequent Events

Note 18. Subsequent Events


Change in Majority Owner


On November 19, 2013, 734 Investors, LLC (the "Buyer"), an investment fund affiliated with 734 Agriculture, LLC ("734 Agriculture") and George R. Brokaw, a Member of 734 Agriculture and the Buyer's designee (the "Designee"), completed the previously announced purchase from Alico Holding, LLC (the "Seller"), a company wholly owned by Atlantic Blue Group, Inc., of 3,725,457 shares of common stock, par value $1 per share, of Alico, Inc. (the "Company" and the "Common Stock"), owned by the Seller for $37.00 per share, for an aggregate purchase price of approximately $137,841,909 in cash (the "Share Purchase"). The Buyer used equity investments from its members of approximately $123,410,000 and debt financing of $13,691,909 to fund its portion of the purchase price. The Designee used cash on hand to fund his portion of the purchase price.


Waiver of Debt Maturity Acceleration


The Company's loan agreements with Rabo prohibit the sale or conveyance of a controlling interest in Alico without Rabo's prior consent. The loan agreements also provide that any sale or conveyance of an interest in Alico will not be considered an event of default as long as the Chief Executive Officer of the Company is not removed or replaced within two years of such sale or conveyance.


The Company advised Rabo that Atlanticblue entered into an agreement with 734 Investors, LLC whereby Atlanticblue agreed to sell to 734 Investors, LLC approximately 51% of the issued and outstanding voting stock of the Company (the "Purchase and Sale"), which Purchase and Sale constitutes the sale of a controlling interest as defined in the loan documents. The Company further advised Rabo that Clayton G. Wilson would replace JD Alexander as the Company's Chief Executive Officer subsequent to the Purchase and Sale.


Rabo executed an agreement dated November 15, 2013 whereby they consented to the Purchase and Sale and the Chief Executive Officer replacement as required by the loan documents. Rabo further confirmed that these transactions will not be deemed an event of default under any of the loan documents.


Incentive Equity Plans, Employee Benefit Plans and Management Consulting Agreement


The change in majority owner discussed above triggered the change in control provisions of the grants under the 2008 Incentive Equity Plans. As a result, the Company will be required to issue 152,403 shares of treasury stock, before withholdings for income taxes, to the Named Executive Officers who were recipients of the grants on or before January 19, 2014. The change in majority owner discussed above did not, however, trigger a change in control under the Rabbi Trust funding mechanism for the Company's Management Security Plan, and no funding will be required.


Concurrent with his resignation from the Board of Directors and his resignation as Chief Executive Officer, JD Alexander entered into a consulting agreement with the Company that provides for monthly payments totaling $2 million over two years beginning one month from his resignation date. In addition, Mr. Alexander and the Company agreed to terminate Mr. Alexander's change in control agreement with the Company, which relieved the Company of any obligation to make payments to Mr. Alexander under that agreement.