Farmer Bros. Co. (NASDAQ: FARM) (the “Company”), today announced it
has entered into a cooperation agreement (the “Cooperation
Agreement”) with JCP Investment Management, LLC (collectively with
its affiliates, “JCP”) and 22NW, LP (collectively with its
affiliates, “22NW”), which together own approximately 15.7% of the
Company’s outstanding common stock. Under the Cooperation
Agreement, the Company has agreed to promptly appoint Bradley L.
Radoff as an independent member of the Board of Directors (the
“Board”). The Company will also include Mr. Radoff and an
additional independent nominee from JCP’s nomination notice (the
“Second New Director”) on its slate of candidates standing for
election at the 2022 Annual Meeting of Stockholders (the “2022
Annual Meeting”).
Upon election to the Board, the Second New
Director will fill a vacancy created by the retirement of Charles
F. Marcy from the Board at the 2022 Annual Meeting. Following the
2022 Annual Meeting, Christopher P. Mottern will retire from the
Board, effective as of June 30, 2023. The size of the Board will
not exceed eight after Mr. Mottern’s retirement.
The Company also agreed to form a new committee
of the Board tasked with reviewing strategic alternatives and
capital allocation initiatives promptly following the 2022 Annual
Meeting. Both Mr. Radoff and the Second New Director will serve on
the newly formed committee as well as the Nominating and Corporate
Governance Committee.
Additionally, JCP has agreed to withdraw its
notice of intent to nominate director candidates for election at
the 2022 Annual Meeting and both JCP and 22NW have agreed to cease
all solicitation and other activities in connection with the 2022
Annual Meeting. During the term of the Cooperation Agreement, JCP
and 22NW have also agreed to customary standstill provisions and
voting commitments.
“Chris and Chuck have provided thoughtful
leadership, perspective and guidance to the Board during their
tenures. We are grateful for their contributions and wish them the
best,” said D. Deverl Maserang II, President and Chief Executive
Officer of the Company. “The Company would also like to welcome
Brad to the Board. He brings extensive financial and investment
knowledge, a track record of value creation and significant
experience serving on the board of directors of public companies.
We also look forward to continuing to work with our stockholders,
JCP and 22NW, going forward.”
“We appreciate the collaborative and
constructive approach taken by the Board in reaching this
agreement. The Board’s addition of two new independent directors
and its commitment to maximizing stockholder value excite us about
the Company’s future,” said James C. Pappas of JCP. “We look
forward to continued collaboration with the Company to unlock
value,” commented Aron English of 22NW.
The complete Cooperation Agreement will be filed
by the Company with the U.S. Securities and Exchange Commission
(the “SEC”) as an exhibit to a Current Report on Form 8-K.
About Bradley L. Radoff
Bradley L. Radoff is a successful investor and
proven public company director with significant experience in the
areas of corporate governance, capital allocation, operational
turnarounds and strategic reviews. Mr. Radoff has held roles at
some of the world’s top asset management firms and financial
institutions, including Citadel and Third Point, where he held a
senior-level position. He currently serves as a director of Harte
Hanks, Inc. (NASDAQ: HHS), a leading global customer experience
company, and Enzo Biochem, Inc. (NYSE: ENZ), a leading biosciences
and diagnostics company. Mr. Radoff previously served as a director
of companies that include VAALCO Energy, Inc. (NYSE:EGY), a
Texas-based independent energy company, from June 2020 to January
2022, Support.com, Inc. (formerly NASDAQ: SPRT), a leading provider
of cloud-based software and services, from June 2016 until its
merger in September 2021, and Pogo Producing Company (formerly
NYSE: PPP), a major oil and natural gas company, from March 2007 to
November 2007 prior to its sale to Plains Exploration for $3.6
billion. Mr. Radoff graduated summa cum laude with a B.A. in
Economics from The Wharton School at the University of
Pennsylvania.
About Farmer Bros. Co.Founded
in 1912, Farmer Bros. Co. is a leading coffee roaster, wholesaler,
equipment servicer and distributor of coffee, tea and other allied
products. The Company’s product lines include organic, Direct Trade
and sustainably-produced coffee. With a robust line of coffee, hot
and iced teas, cappuccino mixes, spices, and baking/biscuit mixes,
the Company delivers extensive beverage planning services and
culinary products to its U.S. based customers. The Company serves a
wide variety of customers, from small independent restaurants and
foodservice operators to large institutional buyers like
restaurant, department and convenience store chains, hotels,
casinos, healthcare facilities, and gourmet coffee houses, as well
as grocery chains with private brand coffee and consumer branded
coffee and tea products, and foodservice distributors.
Headquartered in Northlake, Texas, Farmer Bros.
Co. generated net sales of $469.2 million in fiscal 2022 and has
approximately 1,068 employees nationwide. The Company’s primary
brands include Farmer Brothers®, Artisan Collection by Farmer
Brothers™, Superior®, Metropolitan™, China Mist® and Boyds®.
Forward Looking StatementsThe
Company may from time to time make written or oral “forward-looking
statements”, including statements contained in this press release
and in the Company’s filings with the SEC. These forward-looking
statements include statements with respect to the Company’s
beliefs, plans, objectives, goals, expectations, anticipations,
estimates, and intentions that are subject to significant risks and
uncertainties and are subject to change based on various factors,
many of which are beyond the Company’s control. These factors
include competition, timing, credit risks of lending activities,
changes in general economic conditions, price pressures on loan and
deposit products, and other factors detailed from time to time in
the Company’s filings with the SEC. The words “may”, “could”,
“should”, “would”, “believe”, “anticipate”, “estimate”, “expect”,
“intend”, “plan”, and similar expressions are intended to identify
forward-looking statements. All such statements are made in good
faith by the Company pursuant to the “safe harbor” provisions of
the Private Securities Litigation Reform Act of 1995. The Company
does not undertake to update any forward-looking statement, whether
written or oral, that may be made from time to time by or on behalf
of the Company, except as may be required by applicable law or
regulations.
Contact
For Farmer Bros.
EllipsisJeff Majtyka 646-776-0886
For JCP or 22NW
Longacre Square PartnersGreg Marose,
201.936.4126gmarose@longacresquare.com
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