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Peter F. Brennan
c/o Americap Partners LP
237 Park Avenue, 9th Floor
New York, New York 10017
Telephone: 212/692 7648; Facsimile: 212/692 7657
March 13, 2003
By telecopier:
310/320-2436
Mr. John E. Simmons
Secretary of the Corporation
Farmer Bros. Co.
20333 South Normandie Avenue
Torrance, California 90502
Re: Request for information and
demand to inspect records
Dear Mr. Simmons:
As
indicated in the accompanying copy of a Durable Power of Attorney, I have
been authorized to act on behalf of Marc S. Heilweil, a shareholder of
Farmer Bros. Co. ("Company"), for the limited purpose of obtaining
information relevant to the shareholder’s interests.
The
objective of this request is to obtain information that can be used for
investment decisions. It will therefore be assumed that any
information you provide is either publicly available or would be provided to
any other public investor or analyst making a similar request, and that
there are no restrictions on any recipient's use of the information or its
disclosure to others. Under these circumstances, you are encouraged to
respond to this request by reporting the information publicly in SEC filings
or other means, rather than by providing the information directly to me.
The
following information is requested:
A.
A statement of the Company's policies regarding the management of its
investment assets (including all forms of cash and securities, each referred
to individually as an "Investment" and aggregately as the "Investment
Fund").
B.
Financial statements of the Investment Fund for the Company's last three
fiscal years ending in June and for the six month interim period ending
December 31, 2002, providing the information about assets, liabilities,
income and expenses that would be required of a closed-end investment
company under the Investment Company Act of 1940 ("ICA").
C.
A list of Investments held at the end of the Company's last three fiscal
years ending in June and for the six month interim period ending December
31, 2002, providing the information about each Investment that would be
required of a closed-end investment company under the ICA.
D.
Identification of the persons responsible for managing the Investment Fund
during each of the Company's last three fiscal years ending in June and the
six month interim period ending December 31, 2002, providing the information
about their qualifications, terms of employment, affiliations and interests
that would be required of a closed-end investment company under the ICA.
E.
Description of all transactions "which would be in violation of the
affiliated transaction prohibitions in Section 17 of the ICA" or of Section
23 of the ICA as stated by the Company's attorney in part II of an August
26, 2002 letter to the Securities and Exchange Commission, during each of
the Company's last three fiscal years ending in June and the six month
interim period ending December 31, 2002.
F.
Report of all decisions or actions of the Company's board of directors
during the past five years concerning the benefits or requirements of
registering the Company or any affiliate as an investment company under the
ICA, and identifying any experts or authorities on which the board relied.
Please
let me know within a week whether the Company will provide each of the items
of information requested, and, for each item you will provide, what period
of time is proposed. In relation to any requested information you do
not expect to provide within thirty days, or some other period of time to
which we agree, I hereby demand, pursuant to Section 1601 of the California
Corporations Code, that the Company produce, for inspection and copying
during normal business hours, the following accounting books and records and
minutes of proceedings of the shareholders and the board and committees of
the board ("Records") of the Company and its subsidiaries:
1.
All Records required to identify, on an unconsolidated basis, the specific
investments (each one referred to hereafter as "a Company Investment", and
collectively as "the Company's Investments") comprising the Company's assets
reflected in the Company's financial statements under the headings (a) Cash
and cash equivalents, Short‑term investments, or Long‑term investments, and
(b) any other derivative or other investment not reflected in such headings,
as of the end of each quarterly period since the end of the June 1999 fiscal
year.
2.
All Records reflecting the value of each Company Investment as of the end of
each quarterly period since the end of the June 1999 fiscal year.
3.
All Records necessary to determine the amount of income derived from each
Company Investment as of the end of each quarterly period since the end of
the June 1999 fiscal year.
4.
All Records required to determine the Company's costs associated with the
management and administration of the Company's Investments as of the end of
each quarterly period since the end of the June 1999 fiscal year.
5.
All Records reflecting the identity, qualifications, and responsibilities of
all persons involved in the management or administration of the Company's
Investments as of the end of each quarterly period since the end of the June
1999 fiscal year.
6.
All Records reflecting any consideration or actions taken by the Company's
directors during the past five years concerning (a) declarations of
dividends, (b) policies and practices relating to assets not actively
utilized in the Company's existing manufacturing and distribution
operations, (c) policies and practices relating to the authorization or
engagement of employees, advisers or others for the management or
administration of the Company's Investments, and (d) requirements or
benefits of the Company's registration as an investment company pursuant to
the Investment Company Act of 1940 ("ICA").
The
purposes of this demand are (a) to evaluate the investment performance of
the Company's Investments, (b) to enable a determination of whether the
Company is in compliance with the ICA, (c) to evaluate the potential costs
of any failure to comply with the ICA, (d) to evaluate the performance of
the Company's current directors, and (e) to determine the relevant
qualifications of future candidates for election to the Company's board of
directors.
It is
requested that I or my designee(s) be given access to all such Records as
exist in California or any other state and that such records be made
available to us and/or our designee(s) for a period of thirty days so that
we may have sufficient opportunity to examine and copy the records.
You
should understand that any or all information obtained from our examination
of records may be made available to participants in a "Forum" which is open
to all shareholders of the Company, but that any such communications will
not relieve the Company's management of its responsibility for providing
information to public investors in compliance with applicable SEC
regulations.
Please
let me know if you have any questions about these information requests and
my related demand to inspect records.
Very truly yours,
Peter F. Brennan,
as Delegate
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