Item 1.01. Entry into a Material Definitive Agreement.
Executive
Officer Compensation
On August
24, 2006, the Compensation Committee of the Board of Directors of Farmer
Bros. Co. (the “Company”) approved the following regarding compensation
for the Company’s executive officers:
1. Fiscal 2007 Salaries
Effective
June 26, 2006, the base salaries of the Company’s executive officers for
the fiscal year ending June 30, 2007 will be as follows: $365,750 for
Guenter W. Berger, Chairman and CEO; $320,000 for Roger M. Laverty III,
President and Chief Operating Officer; $287,375 for John E. Simmons,
Treasurer and CFO; and $287,375 for Michael J. King, Vice President,
Sales. Mr. Laverty’s base salary remains unchanged from the amount set
forth in his Employment Agreement, a copy of which was previously filed by
the Company on Form 8-K filed with the SEC on June 8, 2006. The increase
in base salaries from fiscal 2006 levels for Messrs. Berger, Simmons and
King reflect cost of living changes.
2. Incentive Compensation Plan — Fiscal 2006 Awards
Executive
officer bonuses for the fiscal year ended June 30, 2006 were determined
under the Farmer Bros. Co. 2005 Incentive Compensation Plan (the “Plan”),
a copy of which was previously filed by the Company on Form 8-K filed with
the SEC on October 12, 2005. For fiscal 2006, the Compensation Committee
designated Guenter W. Berger, John E. Simmons and Michael J. King as
participants in the Plan. Mr. Laverty was not employed by the Company
during fiscal 2006 and, therefore, was not eligible to participate in the
Plan.
For fiscal
2006, the Company set the target awards of Messrs. Berger, Simmons and
King at $200,000, $150,000 and $150,000, respectively. At year-end,
bonuses were awarded based on the level of achievement of Company
financial performance criteria and each participant’s original goals. The
Compensation Committee has discretion to increase, decrease, or entirely
eliminate the bonus amount derived from the Plan’s formula. Based on the
foregoing, the Compensation Committee approved fiscal 2006 cash incentive
bonuses for the Company’s executive officers as follows: $150,000 for Mr.
Berger; $100,000 for Mr. Simmons; and $100,000 for Mr. King. The form of
award letter under the Plan for fiscal 2006 is attached as Exhibit 99.1 to
this Current Report on Form 8-K and is incorporated herein by reference.
Director
Compensation
For fiscal
2007, the Compensation Committee has determined that the annual retainer,
meeting fees and chairman retainers will remain unchanged from fiscal
2006, subject to mid-year review. Therefore, each non-employee director
will continue to receive an annual retainer of $25,000 and meeting fees of
$1,500 for each Board meeting and committee meeting (if not held in
conjunction with a Board meeting) attended, except that the per meeting
fee for Audit Committee members will be $2,500. The Audit Committee
Chairman will continue to receive an annual retainer of $5,000. The
Compensation Committee Chairman will continue to receive an annual
retainer of $2,500. The members of the Board are also entitled to
reimbursement of travel expenses from outside the greater Los Angeles
area, in accordance with Company policy, incurred in connection with
attendance at Board and committee meetings.
ESOP
Administrative Committee
Effective
August 24, 2006, Guenter W. Berger stepped down from the Company’s ESOP
Administrative Committee and was replaced by Roger M. Laverty III. As a
result, the members of the ESOP Administrative Committee are Roger M.
Laverty III, John H. Merrell and John Samore, Jr.
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Item 2.02. Results of Operations and Financial Condition.
On August
28, 2006, the Company issued a press release announcing that at a meeting
on August 24, 2006, the Board of Directors declared a quarterly dividend
and set the record and meeting dates for the 2006 Annual Meeting of
Stockholders. A copy of the press release is attached as Exhibit 99.2 to
this Current Report on Form 8-K and is incorporated herein by reference.
Item 8.01. Other Events.
On August
24, 2006, the Board of Directors, upon recommendation of the Audit
Committee, amended and restated the Audit Committee Charter. A copy of
the revised Audit Committee Charter is attached as Exhibit 99.3 to this
Current Report on Form 8-K and will be posted on the Company’s website at
www.farmerbroscousa.com as soon as practicable.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
99.1
Form of Award Letter (Fiscal 2006) under Farmer Bros. Co. 2005
Incentive Compensation Plan
99.2
Press release of Farmer Bros. Co. dated August 28, 2006
99.3
Audit Committee Charter adopted by the Board of Directors on August
24, 2006
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SIGNATURE
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.
Dated: August 30, 2006
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FARMER
BROS. CO. |
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By: |
/s/ JOHN
E. SIMMONS |
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Name:
John E. Simmons |
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Title:
Treasurer, Chief Financial Officer |
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