Heads Up for the 2016 Proxy Season: Companies See Victory on Excluding "Substantially Implemented" Proxy Access - February 16, 2016

Weil, Gotshal & Manges

Description

SEC Disclosure and Corporate Governance ENDNOTES 1 The 15 companies that were granted relief all received proposals from John Chevedden. They are: Alaska Air Group, Baxter International Inc., Capital One Financial, Cognizant Technology Solutions Corp., Dun & Bradstreet Corp., General Dynamics Corp., Huntington Ingalls Industries, Inc., Illinois Tool Works Inc., Northrup Grumman Corp., PPG Industries, Science Applications International Corp., Target Corp., Time Warner Corp., United Health Group, Inc. and Western Union Corp. 2 The form of proxy access proposal submitted by John Chevedden, expressly required an “unrestricted aggregation limit.” See, e.g., Alaska Air Group, No Action Letter (avail. Feb.

12, 2016). The proxy access proposal submitted to General Electric Company by Kevin Mahar in 2015, for which GE successfully obtained no-action relief under (i)(10), was silent on whether GE’s proxy access bylaw could include an aggregation limit. See General Electric Company, No Action Letter (avail.

March 3, 2015). 3 The three companies that were not granted relief are: Flowserve Corp., NVR Inc. and SBA Communications. FlowerServe received a proposal from John Chevedden.

NVR and SBA proposals were follow-on proposals received from the NYC Comptroller seeking revisions of previously adopted proxy access bylaws. The NVR and SBA proposals requested that the companies’ proxy access bylaw be revised to (i) eliminate the aggregation limit ( 20 shareholders in the case of NVR; 10 shareholders in the case of SBA), (ii) reduce the required shareholding for the nominating group from 5% to 3%, (iii) increase the number of days for which a shareholder has the power to recall loaned shares from three to five business days in order for such shares to be considered “owned” for the purposes of the ownership threshold, and (iv) in the case of SBA, increase the maximum number of proxy access candidates from 20% to 25% of the board. * * * If you have any questions on these matters, please do not hesitate to speak to your regular contact at Weil, Gotshal & Manges LLP or to any member of Weil’s Public Company Advisory Group: Howard B. Dicker Bio Page howard.dicker@weil.com +1 212 310 8858 Catherine T.

Dixon Bio Page cathy.dixon@weil.com +1 202 682 7147 Lyuba Goltser Bio Page lyuba.goltser@weil.com +1 212 310 8048 P.J. Himelfarb Bio Page pj.himelfarb@weil.com +1 214 746 7811 Ellen J. Odoner Bio Page ellen.odoner@weil.com +1 212 310 8438 Adé K.

Heyliger Bio Page ade.heyliger@weil.com +1 202 682 7095 Kaitlin Descovich Bio Page kaitlin.descovich@weil.com +1 212 310 8103 Joanna Jia Bio Page joanna.jia@weil.com +1 212 310 8089 Megan Pendleton Bio Page megan.pendleton@weil.com +1 212 310 8874 Reid Powell Bio Page reid.powell@weil.com +1 212 310 8831 We thank our colleague Kaitlin Descovich for her contribution to this alert. © 2016 Weil, Gotshal & Manges LLP. All rights reserved. Quotation with attribution is permitted.

This publication provides general information and should not be used or taken as legal advice for specific situations that depend on the evaluation of precise factual circumstances. The views expressed in these articles reflect those of the authors and not necessarily the views of Weil, Gotshal & Manges LLP. If you would like to add a colleague to our mailing list, please click here.

If you need to change or remove your name from our mailing list, send an email to weil.alerts@weil.com. Weil, Gotshal & Manges LLP February 16, 2016 2 .