(Bloomberg) -- Weeks after Brown-Forman Corp. announced it had terminated discussions to combine with spirits group Pernod Ricard SA, two members of the family that controls the owner of Jack Daniel’s drafted a letter to the board. Their assessment was withering.

W. L. Lyons Brown III, a descendant of the Brown-Forman founding family, and his brother Stuart Brown, a retired director, took the board to task for deteriorating results, questionable pay practices and the bungled deal with Pernod Ricard.

The two Browns were especially critical of Lawson Whiting, Brown-Forman’s chief executive officer, writing that he “carries a three-year track record defined by poor operating performance, failed transactions, and significant increases in personal compensation, even as the stock languished and employees were terminated.”

The letter is dated July 10. Three days later, Brown-Forman announced Whiting had decided to retire.

The missive offers a glimpse of tensions within a family whose forefather started the first company to sell whiskey in sealed glass bottles 156 years ago. At its peak in 2020, Brown-Forman was worth $38 billion. Early this year, the market value of the maker of Woodford Reserve Whiskey, Herradura tequila and Diplomático rum slumped to as low as $10.5 billion.

The swoon in the shares is “eliminating billions of dollars of generational wealth for the Brown family and all other shareholders,” the brothers wrote. “This decline has occurred in full public view, with a lack of management accountability, and key analysts continue to downgrade the stock.”

A Brown-Forman spokesperson said the company “takes feedback from all stakeholders seriously, and we regularly engage in constructive dialogue.”

Lyons Brown III worked at Brown-Forman for about 15 years until 2002. In 2005, he founded Altamar Brands, an importer and creator of wines and spirits including Lágrimas del Valle tequila and High N’ Wicked whiskeys. He’s the son of a former Brown-Forman CEO and chairman.

Stuart Brown served on the company’s board from 2015 until 2024. The Wall Street Journal reported on the brothers’ letter to the board earlier.

The slide in Brown-Forman shares has coincided with sustained declines in revenue and malaise across the spirits industry, which is grappling with lower drinking rates, changing consumer preferences and heightening awareness of alcohol’s health risks.

On March 20, the stock traded at an almost 14-year low. The following week, Bloomberg News reported that Pernod Ricard was exploring a potential acquisition of the Louisville, Kentucky-based company. The talks fell apart within roughly a month.

In their letter, Lyons Brown III and Stuart Brown asked for more information about why Brown-Forman didn’t reach an agreement with Pernod Ricard, and what the company’s next move will be.

“If the Pernod Ricard transaction was Plan A, what is Plan B? The company is in crisis,” the brothers wrote. They criticized Wolf Pen Branch LP, the family-controlled entity representing Brown descendants who hold a majority of the Class A voting shares, as well as the board and management, writing that no one in leadership “is providing shareholders with any comfort on why the company is an investment worth holding.”

Despite the Pernod Ricard transaction breaking down, the board approved millions of dollars in bonuses for executives involved in the talks, which “produced no value for shareholders,” the brothers wrote.

Brown-Forman said in a regulatory filing that executives including Whiting and Chief Financial Officer Jim Peters received payments totaling roughly $6 million. Whiting’s payout was $2.7 million.

“The board is rewarding failure, and doing so lavishly and publicly,” the brothers wrote, noting that Whiting has continued to collect performance bonuses even as sales have fallen for three years.

Brown-Forman separately has fielded interest from Sazerac Co., the closely held owner of Buffalo Trace bourbon and BuzzBallz cocktails.

Lyons Brown III and Stuart Brown questioned Brown-Forman’s lack of disclosure about its engagement with Sazerac, writing that a combination with the company may have merit.

“A Sazerac combination seemingly would have offered the chance to significantly strengthen the company’s position domestically and globally,” the brothers wrote. On July 26, Brown-Forman announced that it had rejected an unsolicited takeover offer from Sazerac, which had asked the company to reconsider the $15 billion bid that was rebuffed earlier this year.

“The board has a fiduciary duty to evaluate all credible offers for the benefit of shareholders, and that duty requires more from the board,” the brothers wrote.

Lyons Brown III and Stuart Brown called on the board to present a strategic plan, restore accountability in executive compensation and engage more with all family shareholders.

“The status quo is unacceptable, and the board will be held accountable for the choices it makes — of fails to make — in the weeks an months ahead,” they wrote.

(Adds details from letter in 16th and 20th paragraphs. A previous version corrected the size of Whiting’s payout.)

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