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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2005 OR
[ ]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ________ TO __________
Commission file number: 0-1375
FARMER BROS. CO.
(exact name of registrant as specified in its charter)
Delaware 95-0725980
(State of Incorporation) (I.R.S. Employer Identification No.)
20333 South Normandie Avenue, Torrance, California 90502
(address of principal executive offices) (Zip Code)
(310)787-5200
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. YES [X] NO [ ]
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act). YES [X] NO [ ]
On May 6, 2005 Registrant had 16,075,080 shares outstanding of its
common stock, par value $1.00 per share, which is the Registrant's only class
of common stock.
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Dollars in thousands, except share and per share
data)
FARMER BROS. CO.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
For the three months For the nine months
ended March 31, ended March 31,
2005 2004 2005 2004
Net sales $50,271 $49,069 $148,199 $146,245
Cost of goods sold 20,928 18,488 59,319 53,459
Gross profit 29,343 30,581 88,880 92,786
Selling expense 23,943 22,735 68,492 68,019
General and administrative expense 7,567 7,103 20,854 19,843
Operating expenses 31,510 29,838 89,346 87,862
(Loss) income from operations (2,167) 743 ( 466) 4,924
Other expense and income:
Dividend income 850 844 2,584 2,527
Interest income 738 935 1,799 2,156
Other, net (expense) income (3,019) 4,980 (11,241) 6,149
(1,431) 6,759 (6,858) 10,832
(Loss) income before taxes (3,598) 7,502 (7,324) 15,756
Income taxes (benefit) (4,454) 1,899 (5,609) 5,077
Net income(loss) $ 856 $5,603 ($1,715) $10,679
Net income (loss) per common share $0.06 $0.42 ($0.13) $0.66
Weighted average
shares outstanding 13,687,840 13,457,300 13,621,390 16,266,410
Dividends declared per share $0.10 $0.095 $0.30 $0.29
The accompanying notes are an integral part of these financial statements.
FARMER BROS. CO.
CONSOLIDATED BALANCE SHEETS
March 31, June 30,
2005 2004
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 6,420 $21,807
Short term investments 181,041 176,903
Accounts and notes receivable, net 15,465 14,565
Inventories 37,691 35,579
Income tax receivable 6,137 408
Deferred income taxes 2,052 775
Prepaid expenses 4,296 2,683
Total current assets $253,102 $252,720
Property, plant and equipment, net $41,856 $42,300
Notes receivable 143 143
Other assets 21,293 21,609
Deferred income taxes 1,806 1,099
Total assets $318,200 $317,871
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $11,245 $9,589
Accrued payroll expenses 5,232 6,999
Other 4,576 4,601
Total current liabilities $21,053 $21,189
Accrued post-retirement benefits $28,581 $26,984
Total liabilities $49,634 $48,173
Commitments and contingencies
Stockholders' equity:
Common stock, $1.00 par value,
authorized 20,000,000 shares;
16,075,080 shares issued and outstanding $16,075 $16,075
Additional paid-in capital 32,419 32,248
Retained earnings 277,874 283,654
Unearned ESOP shares (57,065) (61,542)
Less accumulated comprehensive loss (737) (737)
Total stockholders' equity $268,566 $269,698
Total liabilities and
stockholders' equity $318,200 $317,871
The accompanying notes are an integral part of these financial statements.
FARMER BROS. CO.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) For the nine months
ended March 31,
2005 2004
Cash flows from operating activities:
Net (loss) income ($1,715) $10,679
Adjustments to reconcile net (loss) income to net cash
(used in) provided by operating activities:
Depreciation 6,221 5,302
Deferred income taxes (1,984) -
Loss on sales of assets (19) (52)
ESOP compensation expense 4,648 3,835
Net (loss) on investments (11,786) (631)
Change in assets and liabilities:
Short term investments 7,649 (2,738)
Accounts and notes receivable ( 935) (3,846)
Inventories (2,112) 722
Income tax receivable (5,729) 1,978
Prepaid expenses and other assets (1,298) 883
Accounts payable 1,656 2,278
Accrued payroll expenses and other (1,792) 3,479
Accrued post-retirement benefits 1,597 1,684
Other long term liabilities - (5,570)
Total adjustments (3,884) 7,324
Net cash (used in) provided by
operating activities ($5,599) $18,003
Cash flows from investing activities:
Purchases of property, plant and equipment (5,841) (5,806)
Proceeds from sales of property, plant
and equipment 83 86
Notes repaid 35 34
Net cash (used in) investing activities (5,723) (5,686)
Cash flows from financing activities:
Dividends paid (4,065) (4,354)
ESOP contributions - (32,412)
Proceeds from sale of short-term investments - 111,161
Purchase of capital stock - (111,161)
Issue capital stock - 31,236
Net cash (used in) financing activities (4,065) (5,530)
Net(decrease) increase in cash
and cash equivalents (15,387) 6,787
Cash and cash equivalents at beginning of period 21,807 18,986
Cash and cash equivalents at end of period $ 6,420 $25,773
The accompanying notes are an integral part of these financial statements.
Notes to Consolidated Financial Statements (Unaudited)
Note 1. Unaudited Consolidated Financial Statements
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by accounting principles generally accepted in the United
States for complete consolidated financial statements. In the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation of the interim financial data have
been included. Operating results for the three and nine month periods ended
March 31, 2005 are not necessarily indicative of the results that may be
expected for the fiscal year ending June 30, 2005.
For further information, refer to the consolidated financial statements and
footnotes thereto included in the Farmer Bros. Co. annual report on Form 10-K
for the fiscal year ended June 30, 2004.
Share and per share amounts included in the accompanying consolidated financial
statements and in the notes to the consolidated financial statements have been
retroactively adjusted for all periods presented to reflect a ten-for-one stock
split in May 2004.
Note 2. Investments
Investments are as follows (in thousands):
March 31, June 30,
2005 2004
Trading securities at fair value
U.S. Treasury obligations $119,274 $119,528
Preferred stock 60,921 56,037
Futures, options and other
derivative investments 846 1,338
$181,041 $176,903
Note 3. Inventories
(in thousands)
March 31, 2005
Processed Unprocessed Total
Coffee $ 3,071 $13,584 $16,655
Allied products 12,309 3,793 16,102
Coffee brewing equipment 1,744 3,190 4,934
$17,124 $20,567 $37,691
June 30, 2004
Processed Unprocessed Total
Coffee $ 3,034 $10,736 $13,770
Allied products 11,800 3,665 15,465
Coffee brewing equipment 2,341 4,003 6,344
$17,175 $18,404 $35,579
Interim LIFO Calculations
An actual valuation of inventory under the LIFO method is made only
at the end of each year based on the inventory levels and costs at that
time. Accordingly, interim LIFO calculations must necessarily be based
on management's estimates of expected year-end inventory levels and costs.
Because these are subject to many forces beyond management's control,
interim results are subject to the final year-end LIFO inventory valuation.
Note 4. Pension Plans
The Company has a contributory defined benefit pension plan for all employees
not covered under a collective bargaining agreement and a non-contributory
defined benefit plan for certain hourly employees covered under a collective
bargaining agreement. The net periodic benefit costs for the defined benefit
plans were as follows:
Components of Net Periodic Benefit Cost
(in thousands)
Three months ended March 31,
2005 2004
Service cost $529 $594
Interest cost 1,071 988
Expected return on plan assets (1,559) (1,362)
Amortization of transition obligation (asset) 0 0
Amortization of prior service cost 46 62
Amortization of net loss 18 336
Net periodic benefit cost $105 $618
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Liquidity and Capital Resources
There have been no material changes in the Company's liquidity or capital
resources since the fiscal year ended June 30, 2004. The Company continues to
maintain a strong working capital position. All present and future liquidity
needs are expected to be met by internal sources. The Company does not expect
to rely on banks or other third parties for its working capital and other
liquidity needs.
(in thousands) March 31, June 30,
2005 2004
Current assets $253,102 $252,720
Current liabilities 21,053 21,189
Working capital $232,049 $231,531
Total assets $318,200 $317,871
The company has broken ground on a new warehouse in Bakersfield, California,
and has resumed construction of a warehouse in Chico, California, that had been
delayed this winter by wet weather. Each of these warehouses will replace
existing warehouses in these locations and are expected to provide much needed
space in these service areas. Additionally, the Company has entered into an
agreement to acquire a warehouse in Oakland, California, to meet the needs of
our growing Northern California service area by providing additional space and
is expected to improve operating efficiencies. The total cost for the Oakland
facility is not expected to exceed $3 million.
Otherwise, there have been no changes in the needs or commitments described in
the Company's annual report on Form 10-K for the fiscal year ended June 30,
2004.
Results of Operations
We believe the Company's continued emphasis on sales, focused sales training,
new product development, new promotional materials and revised pricing is
beginning to have a positive effect on net sales. Net sales increased 2% to
$50,271,000 for the quarter ended March 31, 2005 as compared to $49,069,000 for
the same quarter of fiscal 2004. Net sales for the nine months ended March 31,
2005 increased 1% to $148,199,000 as compared to $146,245,000 in the same
period of fiscal 2004. The third quarter sales increase largely reflects roast
coffee price increases in late December 2004, and a modest increase in sales
of non-coffee products. On March 28, 2005, the Company increased roast coffee
prices in line with the market. The effect of this increase will be reflected
in operating results for the fourth quarter of fiscal 2005.
Gross profit decreased 4% to $29,343,000 in the quarter ended March 31,
2005 as compared to $30,581,000 in the same quarter of fiscal 2004. Gross
profit for the nine months ended March 31, 2005 decreased 4% to $88,880,000
as compared to $92,786,000 during the first nine months of fiscal 2004. This
decrease primarily reflects a sustained increase in green coffee prices since
November 2004, and the lagging impact of the Company's increase in roast
coffee sales prices. We expect the effect of the Company's most recent price
increases will be observed in the fourth quarter of fiscal 2005. There is no
way to predict when or if the Company will return to its previous profit
margins or what the impact of higher prices will be on demand for the Company's
products.
Operating expenses, consisting of selling and general and administrative
expenses, increased 6% in the third quarter of fiscal 2005 to $31,510,000 as
compared to $29,838,000 in the same quarter of fiscal 2004. Fiscal year-to-
date operating expenses increased 2% to $89,346,000 for fiscal 2005 as compared
to $87,862,000 in fiscal 2004. This increase in operating expenses for the
nine months ended March 31, 2005 was primarily the result of the following
differences (in thousands):
Nine month period ended
March 31,
2005 2004
IT software depreciation $ 2,339 $ 1,051
Consulting 2,539 3,020
Gas, oil and grease 4,091 3,113
ESOP 5,326 4,320
Post retirement benefit costs 3,237 4,765
$17,532 $16,269
Consulting costs associated with the new sales system continue and are not
reflected above. These costs will continue to be capitalized for the balance
of fiscal 2005. We expect the new sales system to go live in the early summer.
Consulting costs during the first nine months of fiscal 2005 include $307,000
incurred in the third quarter of fiscal 2005 associated with the implementation
of Section 404 of the Sarbanes-Oxley Act. We anticipate total consulting costs
associated with this project, divided between fiscal 2004 and 2005, will exceed
$1,000,000.
The increased ESOP expense reflects the increased number of shares acquired by
the ESOP during fiscal 2004. Post retirement benefit costs result from
actuarially derived pension and retiree medical costs.
As a result of the above factors, loss from operations in third quarter of
fiscal 2005 was ($2,167,000) as compared to income of $743,000 in the same
quarter of fiscal 2004. Similarly, loss from operations for fiscal year-to-
date 2005 was ($466,000) as compared to income of $4,924,000 in the same period
of fiscal 2004.
Other (expense) in the third quarter of fiscal 2005 was ($1,431,000) as
compared to income of $6,759,000 in the same quarter of fiscal 2004, and other
(expense) for the first nine months of fiscal 2005 was a loss of ($6,858,000)
as compared to income of $10,832,000 for the comparable period in fiscal 2004.
This is primarily the result of higher green coffee prices during the second
and third quarters of fiscal 2005.
Other, net (expense) in the third quarter of fiscal 2005 was a loss of
($3,019,000) as compared to income of $4,980,000 in the same quarter of fiscal
2004. Higher green coffee prices during the third quarter of fiscal 2005
resulted in a decrease in the value of green coffee futures and options used by
the Company to hedge against a decline in commodity prices. Other, net
(expense) income during the third quarter of fiscal 2005 consisted of net
realized and unrealized coffee trading losses of ($3,329,000), offset by net
gains of $63,000 on other investments.
For the first nine months of fiscal 2005, Other, net (expense) was
($11,241,000), as compared to Other, net income of $6,149,000 for the same
period of fiscal 2004. Higher green coffee prices during the second and third
quarters of fiscal 2005 resulted in a decrease in the value of green coffee
futures and options used by the Company to hedge against a decline in commodity
prices. Other, net (expense) income during the first nine months of fiscal
2005 consisted of net realized and unrealized coffee trading losses of
($12,992,000), offset by net gains on other investments. The net realized and
unrealized losses during the nine month period ended March 31, 2005 consisted
of the following (in thousands):
Nine month period
ended
March 31, 2005
Realized coffee gains $3,616
Realized coffee losses ($16,862)
Unrealized coffee gains 254
Totals ($12,992)
The Company reduced its tax reserve during the third quarter of fiscal 2005
resulting from a favorable determination from a state tax audit which required
the reduction of a previously established tax reserve. The reduction of this
tax reserve and the recognition of a tax benefit for net losses incurred for
the same quarter and the first nine months of fiscal 2005 resulted in a change
in the Company's effective tax rate to (76.5%) from 32.2% for the first nine
months of fiscal 2005 and 2004, respectively.
As the result of the above factors, net income in the third quarter of fiscal
2005 was $856,000, or $0.06 per share, as compared to $5,603,000, or $0.42 per
share, in the same quarter of fiscal 2004. Net loss for the first nine months
of fiscal 2005 was ($1,715,000), or ($0.13) per share, as compared to net
income of $10,679,000, or $0.66 per share, in the first nine months of fiscal
2004.
Quarterly Summary of Results (in thousands, except per share data):
Quarter ended 3/31/04 6/30/04 9/30/04 12/31/04 3/31/05
Net sales $49,069 $47,344 $46,708 $51,220 $50,271
Gross profit $30,581 $29,398 $29,253 $30,298 $29,343
Income (loss) from operations $743 ($1,161) $1,002 $699 ($2,167)
Net income (loss) $5,603 $2,008 $1,497 ($4,068) $856
Net income (loss)
per common share $0.42 $0.11 $0.11 ($0.30) $0.06
Forward-Looking Statements
Certain statements contained in this quarterly report on Form 10-Q regarding
the risks, circumstances and financial trends that may affect our future
operating results, financial position and cash flows are not based on
historical fact and are forward-looking statements within the meaning of
federal securities laws and regulations. These statements are based on
management's current expectations, assumptions, estimates and observations of
future events and include any statements that do not directly relate to any
historical or current fact. These forward-looking statements can be
identified by the use of words like "anticipates," "feels," "estimates,"
"projects," "expects," "plans," "believes," "intends," "will," "assumes" and
other words of similar meaning. Owing to the uncertainties inherent in
forward-looking statements, actual results could differ materially from those
set forth in forward-looking statements. We intend these forward-looking
statements to speak only at the time of this report and do not undertake to
update or revise these statements as more information becomes available except
as required under federal securities laws and the rules and regulations of the
SEC. Factors that could cause actual results to differ materially from those
in forward-looking statements include, but are not limited to, fluctuations in
availability and cost of green coffee, competition, organizational changes, the
impact of a weaker economy, business conditions in the coffee industry and food
industry in general, the Company's continued success in attracting new
customers, variances from budgeted sales mix and growth rates, and weather and
special or unusual events, as well as other risks described in this report and
other factors described from time to time in the Company's filings with the
SEC.
Item 3. Quantitative and Qualitative Disclosure About Market Risk.
Financial Markets
We are exposed to market value risk arising from changes in interest rates on
our securities portfolio. Our portfolio of investment grade money market
instruments includes discount commercial paper, medium term notes, federal
agency issues and U.S. Treasury securities. As of March 31, 2005 over 50%
of these funds were invested in instruments with maturities shorter than 90
days. This portfolio's interest rate risk is not hedged and its average
maturity is approximately 90 days. A 100 basis point increase in the general
level of interest rates would result in a change in the market value of the
portfolio of approximately $1,150,000.
Our portfolio of preferred securities includes investments in derivatives that
provide a natural economic hedge of interest rate risk. We review the
interest rate sensitivity of these securities and (a) enter into "short
positions" in futures contracts on U.S. Treasury securities or (b) hold put
options on such futures contracts in order to reduce the impact of certain
interest rate changes on such preferred stocks. Specifically, we attempt to
manage the risk arising from changes in the general level of interest rates.
We do not transact in futures contracts or put options for speculative
purposes.
The following table demonstrates the impact of varying interest rate changes
based on the preferred stock holdings, futures and options positions, and
market yield and price relationships at March 31, 2005. This table is
predicated on an instantaneous change in the general level of interest rates
and assumes predictable relationships between the prices of preferred
securities holdings, the yields on U.S. Treasury securities and related
futures and options.
Interest Rate Changes
(In thousands)
Market Value at March 31, 2005 Change in Market
Preferred Futures & Total Value of Total
Stock Options Portfolio Portfolio
- -150 basis points
("b.p.") $66,516 $0 $66,516 $4,926
- -100 b.p. 65,190 1 65,190 3,600
Unchanged 60,904 687 61,590 0
+100 b.p. 55,836 5,081 60,917 ( 674)
+150 b.p. 53,246 7,886 61,132 ( 458)
The number and type of futures and options contracts entered into depends on,
among other items, the specific maturity and issuer redemption provisions for
each preferred stock held, the slope of the Treasury yield curve, the expected
volatility of Treasury yields, and the costs of using futures and/or options.
Commodity Price Changes
We are exposed to commodity price risk arising from changes in the market
price of green coffee. We price our inventory on the LIFO basis. In the normal
course of business, we hold a large green coffee inventory and enter into
forward commodity purchase agreements with suppliers. We are subject to price
risk resulting from the volatility of green coffee prices. Volatile price
increases cannot, because of competition and market conditions, always be
passed on to our customers. The Company holds a mix of futures contracts and
options to help hedge against volatile green coffee price decreases. Gains and
losses on these derivative instruments are realized immediately in Other, net
(expense) income.
The following table demonstrates the impact of changes in the price of green
coffee on inventory and green coffee futures and options at March 31, 2005.
It assumes an immediate change in the price of green coffee, and the valuations
of coffee index futures and options and relevant forward commodity purchase
agreements at March 31, 2005 (in thousands):
Market Value of
Coffee Price Coffee Futures Change in Market Value
Change Inventory & Options Totals Derivatives Inventory
-20% $13,300 $ 569 $13,869 $ 610 ($3,355)
unchanged 16,655 124) 16,779
20% 20,000 ( 41) 19,959 ( 165) 3,345
At March 31, 2005 the derivatives consisted mainly of commodity purchase
contracts and options with maturities shorter than four months.
Item 4 Controls & Procedures
As of the end of the period covered by this report, the Chief Executive Officer
and Chief Financial Officer evaluated the Company's disclosure controls and
procedures pursuant to Exchange Act Rule 13a-14 and 15d-14. They have
concluded that the Company's disclosure controls and procedures are effective
in ensuring that all material information required to be filed in this
quarterly report has been made known to them in a timely fashion. In addition,
there have been no significant changes in the Company's internal controls or in
other factors that could significantly affect the Company's internal control
over financial reporting.
PART II OTHER INFORMATION
Item 2. Changes in Securities and Use of Proceeds.
Effective as of March 17, 2005, our Board of Directors approved a stockholder
rights plan (the "Rights Plan"), pursuant to which the Company entered into a
Rights Agreement dated March 17, 2005 (the "Rights Agreement") with Wells Fargo
Bank, N.A., as Rights Agent, and the Board declared a dividend of one preferred
share purchase right (a "Right") for each outstanding share of the Company's
Common Stock, $1.00 par value per share (the "Common Stock"), to stockholders
of record at the close of business on March 28, 2005. Each Right, when
exercisable, will entitle the registered holder to purchase from the Company
one one-hundredth of a share of Series A Junior Participating Preferred Stock,
$1.00 par value per share, at a purchase price of $112.50, subject to
adjustment. The description and terms of the Rights are set forth in the
Rights Plan. Initially, ownership of the Rights will be evidenced by the
certificates representing our Common Stock then outstanding, and no separate
Rights Certificates, as defined in the Rights Plan, will be distributed. The
Rights are not exercisable until the distribution date, as described in the
Rights Agreement, and will expire on March 28, 2015, unless they are earlier
redeemed, exchanged or terminated as provided in the Rights Plan.
Item 6. Exhibits and reports on Form 8-K.
(a) Exhibits. See Exhibit Index.
(b) Reports on Form 8-K.
A Form 8-K dated January 9, 2005 and filed with the Commission on January 10,
2005 announcing the appointment of Guenter W. Berger as Interim Chief Executive
Officer after the sudden death of Chairman and CEO Roy E. Farmer.
A Form 8-K dated and filed with the Commission on January 14, 2005, announcing
the appointment of Carol Farmer Waite to the Company's Board of Directors,
filling a seat vacated by the death of her brother Roy E. Farmer on January 7,
2005.
A Form 8-K dated March 17, 2005 and filed with the Commission on March 18, 2005
announcing the approval of a shareholder rights plan by the Board of Directors
and summarizing the terms of such rights plan.
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
FARMER BROS. CO.
/s/ Guenter W. Berger
Guenter W. Berger, Vice President, Interim Chief Executive Officer and
Director(principal executive officer)
Date: May 6, 2005
/s/ John E. Simmons
John E. Simmons, Treasurer and Chief Financial Officer
(principal financial and accounting officer)
Date: May 6, 2005
EXHIBIT INDEX
3.1 Certificate of Incorporation (filed as an exhibit to the Form 10-Q for
the quarter ended March 31, 2004 and incorporated herein by reference).
3.2 By-laws (filed as an exhibit to the Form 10-Q for the quarter ended March
31, 2004 and incorporated herein by reference).
3.3 Certificate of Designations of Series A Junior Participating Preferred
Stock (filed as Exhibit 3.1 to the Company's Current Report on Form 8-K dated
March 17, 2005 and incorporated herein by reference).
4.1 Rights Agreement dated March 17, 2005 by and between Farmer Bros. Co. and
Wells Fargo Bank, N.A., as Rights Agent (filed as Exhibit 4.1 to the Company's
Current Report on Form 8-K dated March 17, 2005 and incorporated herein by
reference).
10.1 The Farmer Bros. Co. Pension Plan for Salaried Employees (filed as an
exhibit to the Form 10-K for the year ended June 30, 2002 and incorporated
herein by reference).
10.2 The Farmer Bros. Co. Incentive Compensation Plan (filed as an exhibit to
the Form 10-K for the year ended June 30, 2002 and incorporated herein by
reference).
10.3 The Farmer Bros. Co. Employee Stock Ownership Plan (filed as an exhibit
to the Form 10-K for the year ended June 30, 2002 and incorporated herein by
reference).
10.4 Farmer Bros. Co. Employee Stock Ownership Plan Amendment 2 (filed as an
exhibit to the Form 10-Q for the quarter ended December 31, 2003 and
incorporated herein by reference).
10.5 Farmer Bros. Co. Employee Stock Ownership Plan Amendment 3 (filed as an
exhibit to the Form 10-Q for the quarter ended December 31, 2003 and
incorporated herein by reference).
10.6 Loan Agreement dated July 21, 2003 between the Company and Wells Fargo
Bank, Trustee of the Farmer Bros Co. Employee Stock Ownership Plan (filed as an
exhibit to the Form 10-Q for the quarter ended December 31, 2003 and
incorporated herein by reference).
10.7 On January 28, 2005 the Company entered into Change in Control Severance
Agreements with each of the following officers: Guenter Berger, Michael J. King
and John E. Simmons. The form of these agreements is filed herewith.
31.1 Principal Executive Officer Certification Pursuant to Securities Exchange
Act Rules 13a-14 and 15d-14 as Adopted Pursuant to Section 302 of the Sarbanes-
Oxley Act of 2002.(filed herewith)
31.2 Principal Financial Officer Certification Pursuant to Securities Exchange
Act Rules 13a-14 and 15d-14 as Adopted Pursuant to Section 302 of the Sarbanes-
Oxley Act of 2002.(filed herewith)
32.1 Principal Executive Officer Certification Pursuant to 18 U.S.C. Section
1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
(furnished herewith)
32.2 Principal Financial Officer Certification Pursuant to 18 U.S.C. Section
1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
(furnished herewith)