My husband recently received an email from someone we love dearly:
A fellow here at work says he went to the SEC online to look at who owns Caribou and it turns out the holding company is majority owned by people who say they are helping pay for jihad. It’s an Islamic militant organization and it says right on the Security and Exchange Commission web pages who they are.
Just thought you’d like to start making your own coffee at home….
I’d thought we were over this years ago, but my husband hadn’t heard anything about it before, so he went to the SEC website. Of course, he couldn’t find anything like what the email suggested, so he tried Google instead.
He immediately hit the Snopes page, where the short version of the story is that Caribou once had a consultant who said some objectionable things and worked for a Palestinian relief organization. They haven’t worked with the consultant since 2002 and have gone to some trouble to make sure that the charities the company supports are not groups that the U.S. has identified as troublesome.
So he sent the information back, only to get another email.
[He] says that if you go to the SEC website and look at the “10K”, whatever that is, that’s where it says it supports the Islamic militants. He also scoffed at snopes because it is a wiki site.
The 10-K? Really? I’ve put together information to go into 10-Ks. I’ve read big chunks of far too many 10-Ks for research projects. They’re the company’s year-end financial statements for investors and potential investors. They’re written by the company. The last thing a 10-K is going to say is, “We support terrorists.”
My darling husband went one step further than scoffing at the idea, though. He found the 10-K and sent back all the sections that deal with Islam. They paint a slightly different picture than the email would suggest.
Arcapita has substantial control over us, and could limit other shareholders’ ability to influence the outcome of matters requiring shareholder approval and may support corporate actions that conflict with other shareholders’ interests.
Arcapita beneficially owns 11,672,245 shares, or approximately 60.6%, of the outstanding shares of our common stock as of January 1, 2006. Arcapita’s ownership of shares of our common stock could have the effect of delaying or preventing a change of control of us, could discourage a potential acquirer from obtaining control of us, even if the acquisition or merger would be in the best interest of our shareholders, or could otherwise affect our business because of our compliance with Shari’ah principles as described below. This could have an adverse effect on the market price for shares of our common stock. Arcapita is also able to control the election of directors to our board. Two of the six members of our board of directors are representatives of Arcapita.
Our compliance with Shari’ah principles may make it difficult for us to obtain financing and may limit the products we sell.
Our majority shareholder operates its business and makes its investments in a manner consistent with the body of Islamic principles known as Shari’ah. Consequently, we operate our business in a manner that is consistent with Shari’ah principles and will continue to do so for so long as Arcapita is a significant shareholder. Shari’ah principles regarding the lending and borrowing of money are complicated, requiring application of qualitative and quantitative standards. The negotiation and documentation of financing that is compliant with these principles are generally complex and time consuming. As such, if we have immediate liquidity needs, we may not be able to obtain financing that is compliant with Shari’ah principles on a timely basis. A Shari’ah-compliant company is prohibited from engaging in derivative hedging transactions such as interest rate swaps or futures, forward options or other instruments designed to hedge against changes in interest rates or the price of commodities we purchase. Also, a Shari’ah compliant company is prohibited from dealing in the areas of alcohol, gambling, pornography, pork and pork-related products.
We may be subject to adverse publicity resulting from statements about Arcapita or complaints or questions from our customers arising from such adverse publicity.
Arcapita, our majority shareholder, could be the subject of allegations that could adversely affect our reputation in the eyes of our customers or investors due to the fact that it has offices in Bahrain and that its investors are located in the Middle East. During 2002, we were subject to adverse publicity due to attempts to connect Arcapita with inflammatory and controversial statements made by one of its former outside advisors, in his individual capacity, regarding a variety of subjects, including events in the Middle East. We may be subject to additional adverse publicity in the future due to the ownership of our common stock by Arcapita. Even if unfounded, such adverse publicity could divert our management’s time and attention and adversely affect the way our customers perceive us, our net sales or results of operations, in the aggregate or at individual coffeehouses, or the market price for shares of our common stock.
Oh, yeah. That’s damning. Well, it is, but not for Caribou. Just for the guy at work who can’t tell the difference between practicing a religion and supporting militants. And who won’t read Snopes because someone told him it was a wiki. (It’s not.) Listen to Rush much, dude?
Look, if you really want to get upset with Caribou, complain that they’re installing automatic espresso machines in some of their stores. Coffee made with those always tastes a little stale. Just like this rumor.