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Request for Board Investigation of Reported
Management Presentations to Employees
(February 14, 2006)
Below is the text of a February 14, 2006 letter asking the
chairman of the Farmer Bros. Co. to initiate a board investigation of reported
management solicitations of employee support for incumbent directors based on
misleading information about investor plans to shut the company's operations.
The letter further requests advice of any corrective action taken by the board,
and encourages the board's seeking legal advice regarding management's
compliance with laws relating to the solicitation of shareholder votes for
directors.
Employees may determine the voting of an Employee Stock
Ownership Plan ("ESOP"), which held 2,990,897 shares of Farmer Bros. common
stock (18.6% of the total outstanding) according its latest
SEC Form 13G filing.
The letter shows that a copy was sent to the SEC Enforcement
official who has been responsible for reviewing matters raised in a
January 8, 2004 request for investigation and
a February 13, 2004 request to require information
disclosures, and who has also been copied in subsequent letters dated
January 13, 2005,
March 11, 2005, and
October 11, 2005 addressing related issues.
[letterhead]
LUTIN & COMPANY
575 Madison Avenue
New York, New York 10022
Telephone (212) 605-0335
Facsimile (212) 605-0325
February 14, 2006
By telecopier: 310/320-2436
Mr. Guenter W. Berger
Farmer Bros. Co.
20333 South Normandie Avenue
Torrance, California 90502
Dear Mr. Berger:
It has been brought to my attention that representatives of
Farmer Bros. management have been conducting meetings with groups of the
company’s employees to tell them that they should support the current
members of the board in an effort to stop what is reportedly described as a
plan by investors associated with me to sell off the company’s properties
and shut down the business, terminating the employees’ jobs.
I ask you, in your capacity as its chairman, to inform the board
of this report so that they may determine whether management representatives
have in fact been making such presentations. As you and the other directors
must know, the reported presentations suggesting investor plans to shut
operations are completely inconsistent with both logic and the publicly open
“Forum” communications about seeking strategic alternatives to expand the
company’s operations, which would obviously also expand employee career
opportunities. If it is true that management representatives have been
making misleading statements to company employees, or to anyone else, I will
appreciate your informing me of the corrective actions taken by the board.
Aside from addressing issues of integrity, you are also
encouraged to seek legal advice regarding compliance with laws relating to
the solicitation of votes for directors.
Please let me know if the board or its advisers require any
additional information.
Sincerely yours,
Gary Lutin
cc: Andrew Petillon, Esquire
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