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2007 Conclusion

Forum activities relating to Farmer Bros. Co. were suspended in 2007, following the second year of new management.

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Note: Glass Lewis & Co., a proxy adviser to institutional investors, recommended in its "Proxy Paper" report for the Farmer Bros. annual meeting that the firm's clients vote against management's proposed reincorporation and entrenchment provisions, and further recommended withholding votes for the reelection of directors based on "the board's attempt to curtail the rights of shareholders."  The firm's explanation of this unusual position is copied below, with permission.

Glass Lewis also recommended that its clients vote in favor of the shareholder proposal to restore cumulative voting.



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"We recommend withholding votes for all of the nominees up for election this year based on the board's attempt to curtail the rights of shareholders....

"While we would not typically oppose directors on the basis of a proposal put on the ballot by the board, the six part proposal on this ballot is so unfriendly to shareholders and so contrary to their interests that we can draw no other conclusion but that the board and management have placed their own interests in these matters above those of the owners of their company. In such a situation, we believe that shareholders' best course of action is to replace the board, if possible, with a board that is dedicated to their interests and that will work to forward and protect those interests in every action taken on behalf of the company."


The Forum is open to all Farmer Bros. shareholders, whether institutional or individual, and to professionals concerned with their investment decisions.  Its purpose is to provide shareholders with access to information and a free exchange of views on issues relating to their evaluations of alternatives.  As stated in the Forum's Conditions of Participation, participants are expected to make independent use of information obtained through the Forum, subject to the privacy rights of other participants.  It is a Forum rule that participants will not be identified or quoted without their explicit permission.

There is no charge for participation.  Franklin Mutual Advisers, LLC, the manager of funds owning approximately 12.6% of Farmer Bros. shares, provided initial sponsorship for the Forum and arranged for it to be chaired by Gary Lutin.  Continuing support and guidance of the Forum is provided by an Advisory Panel of actively interested shareholders.

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