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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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