Seven agree to fines and penalties in Flowers Foods securities case

<p>Seven current or former employees of Flowers Foods Inc. have agreed to pay fines and penalties totaling $114,972 for alleged insider trading in Flowers' securities.</p><p>The Securities and Exchange Commission sued the seven in federal court Feb. 10, alleging that while employed by Thomasville-based Flowers they obtained nonpublic information and used it to earn illegal trading profits.</p><p>Without admitting or denying the allegations, the seven agreed to refrain from future violations and to pay the fines and penalties.</p><p>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.</p><p>In a separate but simultaneous press release, Flowers Foods disclosed the sale of its Mrs. Smith's Bakeries' frozen dessert business to Schwan Food Company.</p><p>After the announcements, Flowers Foods' stock traded up $6.12, closing at $23.20.</p><p>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, or both, prior to these announcements and purchased Flowers' securities while in possession of the nonpublic, material information, according to the SEC.</p><p>Marta Turner, Flowers Foods' vice president of communications, said the company had been aware of the investigation and had cooperated with the SEC.</p><p>"None of the people involved is a senior-level employee of the company," she said.</p><p>Flowers Foods is one of the nation's leading bakery companies.</p>