U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 19073/ February 10, 2005

SECURITIES AND EXCHANGE COMMISSION v. PATSY J. ALDREDGE, ROBERT L. BENTON, JR., HOWARD M. COURTNEY, JERRY F. HANCOCK, II, HERMAN D. SMALL, DAN W. STONE, AND CHARLES M. WORTHEY, DEFENDANTS, Civil Action File No.6:05-CD-8 (M.D. Ga.).

SEC CHARGES SEVEN EMPLOYEES OF FLOWERS FOODS, INC. WITH INSIDER TRADING

The Securities and Exchange Commission today announced the filing of an action against seven defendants for engaging in insider trading in the securities of Flowers Foods, Inc. The Commission's complaint, filed in the United States District Court for the Middle District of Georgia, alleges that while employed by Flowers Foods, Inc. these seven defendants obtained material nonpublic information that they used to earn illegal trading profits.

The Commission's complaint alleges that on January 30, 2003, Flowers Foods announced that its expected fiscal fourth quarter 2002 earnings per share would be higher than its previous estimate for the quarter. In a separate but simultaneous press release, Flowers Foods disclosed the sale of its Mrs. Smith's Bakeries's frozen dessert business to Schwan Food Company. After the announcements, Flowers Foods's traded up $6.12 closing at $23.20. The defendants, Patsy J. Aldredge, Robert L. Benton, Jr., Howard M. Courtney, Jerry F. Hancock, II, Herman D. Small, Dan W. Stone, and Charles M. Worthey, learned about either the earnings release or the sale of Mrs. Smith's Bakeries frozen dessert business, or both, prior to these announcements and purchased Flowers Foods securities while in possession of this nonpublic, material information.

The complaint alleges that by their conduct, Aldredge, Benton, Courtney, Hancock, Small, Stone, and Worthey violated Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 thereunder. The Commission seeks a permanent injunction, disgorgement, prejudgment interest, and civil penalties.

Simultaneously with the filing of the Commission's action, Aldredge, Benton, Courtney, Hancock, Small, Stone, and Worthey agreed, without admitting or denying the allegations in the complaint, to the entry of a final judgment permanently enjoining them from future violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. In addition, the seven defendants cumulatively consented to pay disgorgement of $57,486, plus prejudgment interest and cumulatively consented to pay a one-time civil penalty on their profits of $57,486.

SEC Complaint in this matter

http://www.sec.gov/litigation/litreleases/lr19073.htm