Farmer Bros. (NASDAQ: FARM) updates executive change in control incentives

Rhea-AI Filing Summary

Farmer Bros. Co. updated executive severance and bonus arrangements tied to potential change in control events. The company entered into second amended and restated severance agreements with its President and CEO John Moore, CFO Vance Fisher, and VP, General Counsel, Chief Compliance Officer and Secretary Jared Vitemb. The new agreements clarify that a material base salary reduction qualifies as “Good Reason” only if it is not part of a broad reduction outside the one-year change in control period, and they increase severance so that a qualifying termination during that period pays two times the executive’s annual target short-term incentive plan amount instead of a prorated award.

Farmer Bros. also granted Bonus Opportunities Letter Agreements. Moore, Fisher and Vitemb can earn $400,000, $350,000 and $200,000, respectively, if the company closes a change in control transaction by January 1, 2026. If no transaction closes by that date, these bonus amounts are cut in half and paid after January 1, 2026, and on January 2, 2026 the compensation committee will grant performance-based RSUs with grant values of $300,000 to Moore, $75,000 to Fisher and $37,500 to Vitemb.

Insights

Corporate governance analyst

Farmer Bros. ties executive pay more closely to change in control outcomes.

Farmer Bros. Co. revised severance protections and incentives for its top three executives around potential change in control events. The updated severance agreements ensure that only certain base salary cuts count as “Good Reason,” and they increase cash severance during the one-year change in control period to two times each executive’s annual target short-term incentive, rather than just a prorated award.

The new Bonus Opportunities Letter Agreements add explicit, transaction-based incentives. John Moore, Vance Fisher and Jared Vitemb can receive $400,000, $350,000 and $200,000 if a change in control closes by January 1, 2026. If no deal closes by that date, the bonuses drop by half and are paid in cash, and on January 2, 2026 they are scheduled to receive additional performance-based RSUs with stated grant values. These structures emphasize outcomes around any future change in control but do not themselves disclose whether a transaction is planned.

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): August 12, 2025

Farmer Bros. Co.

(Exact Name of Registrant as Specified in Charter)

Delaware		001-34249		95-0725980
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(I.R.S. Employer Identification No.)

14501 N Fwy, Fort Worth, Texas 76177

(Address of Principal Executive Offices) (Zip Code)

(682) 549-6600

(Registrant’s Telephone Number, Including Area Code)

None

(Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
Common Stock, $1.00 par value		FARM		Nasdaq Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). 

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    ¨

Item 5.02.         Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Second Amended and Restated Severance Agreements

On August 12, 2025, Farmer Bros. Co. (the “Company”) entered into a second amended and restated severance agreement (collectively, the “A&R Severance Agreements”) with each of John Moore, President and Chief Executive Officer, Vance Fisher, Chief Financial Officer, and Jared Vitemb, Vice President, General Counsel, Chief Compliance Officer and Secretary (collectively, the “Executives”). The A&R Severance Agreements amend and restate the amended and restated severance agreements (the “Prior Severance Agreements”) that the Company previously entered into with the Executives to: (1) revise the definition of Good Reason to provide that a material reduction in an Executive’s base salary would constitute Good Reason except for a reduction that occurred at any time other than the one-year period after a change in control (the “Change in Control Period”) and that was applicable to all executives or employees of the Company and (2) provide that if a qualifying termination occurred during the Change in Control Period that the Executive would receive two times the Executive’s annual target short-term incentive plan (“STIP”) payment for the year of the qualifying termination instead of a prorated portion of the STIP award.

With the exception of the amendments described above, the terms of the A&R Severance Agreements remained the same as the Prior Severance Agreements. For additional information regarding the terms of the A&R Severance Agreements, see the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on July 6, 2023.

Bonus Pool Agreements

On August 12, 2025, the Company entered into Bonus Opportunities Letter Agreements with each of the Executives whereby (1) Mr. Moore, Mr. Fisher and Mr. Vitemb are eligible to receive $400,000, $350,000 and $200,000, respectively (the “Bonus Allocations”) if the Company closes a change in control transaction (the “Performance Target”) by January 1, 2026, (2) if the Performance Target is not met by January 1, 2026, the Bonus Allocations will be reduced in half and distributed to the Executives on the first payroll date after January 1, 2026 and (3) if the Performance Target is not met by January 1, 2026, the Compensation Committee of the Board of Directors of the Company will grant Mr. Moore $300,000 of performance-based restricted stock units (“PBRSUs”), Mr. Fisher $75,000 of PBRSUs and Mr. Vitemb $37,500 of PBRSUs, subject to the determination of the performance period and performance goals, on January 2, 2026.

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.

Date:     August 14, 2025

	FARMER BROS. CO.
	By:	/s/ Jared Vitemb
		Jared Vitemb VP, General Counsel, Secretary and Chief Compliance Officer

FAQ

What executive severance changes did Farmer Bros. (FARM) approve on August 12, 2025?

Farmer Bros. approved second amended and restated severance agreements for John Moore, Vance Fisher and Jared Vitemb. The changes clarify that a material base salary reduction counts as “Good Reason” only if it is not a broad reduction outside the one-year change in control period, and they increase severance so that a qualifying termination during that period pays 2x the executive’s annual target STIP instead of a prorated award.

Which Farmer Bros. executives are covered by the new Bonus Opportunities Letter Agreements?

The Bonus Opportunities Letter Agreements cover John Moore (President and CEO), Vance Fisher (CFO) and Jared Vitemb (VP, General Counsel, Chief Compliance Officer and Secretary). Each is assigned a specific cash bonus opportunity and potential performance-based RSU grant tied to whether a change in control transaction closes by January 1, 2026.

How much can Farmer Bros. executives earn if a change in control closes by January 1, 2026?

If Farmer Bros. closes a change in control transaction by January 1, 2026, John Moore is eligible for a $400,000 bonus, Vance Fisher for $350,000, and Jared Vitemb for $200,000, as set out in their Bonus Opportunities Letter Agreements.

What happens to the Farmer Bros. executive bonuses if no change in control is completed by January 1, 2026?

If the change in control performance target is not met by January 1, 2026, the bonus allocations for John Moore, Vance Fisher and Jared Vitemb are reduced by half and paid on the first payroll date after that date. In addition, on January 2, 2026 the compensation committee will grant performance-based RSUs valued at $300,000 to Moore, $75,000 to Fisher and $37,500 to Vitemb, with performance period and goals to be determined.

How did Farmer Bros. change the definition of Good Reason in its executive severance agreements?

The revised agreements state that a material reduction in an executive’s base salary will be treated as Good Reason, except where the reduction occurs outside the one-year change in control period and applies to all executives or employees. This refines when an executive may resign for Good Reason and receive severance.

When will the new performance-based RSUs for Farmer Bros. executives be granted if the performance target is not achieved?

If the change in control performance target is not met by January 1, 2026, the compensation committee plans to grant the performance-based RSUs to John Moore, Vance Fisher and Jared Vitemb on January 2, 2026, with the performance period and goals to be set at that time.