The Elimination of the Broker Vote for Director Elections -- Analysis of the Impact During the First Proxy Season October 1, 2010

2 Overview * The analysis compares voting outcomes for “matched” CUSIPS, i.e., for samples of meetings before and after the change in NYSE Rule 452.  The before sample includes 2,508 meetings (companies) in the 2009 proxy season. There were 14,439 directors standing for election in these meetings.  The after sample examines the same 2,508 meetings (companies) in the 2010 proxy season. There were 14,588 directors standing for election in these meetings. The samples exclude mutual funds, ADRs, and contested solicitations. The analysis separates Notice & Access meetings (767) from non-Notice & Access meetings (1,741). The analysis separates meetings that included a “452 Insert” (i.e., the SEC’s educational piece) from meetings that did not include an insert. A total of 1,157 meetings included an insert; of this number, 305 used Notice & Access (852 did not). Voting outcomes are averaged across all directors and meetings. The analysis includes only the beneficial shares processed by Broadridge. Registered shares are excluded. The percentages are computed in three tiers: the percentage of directors receiving at least 50% of the vote cast FOR; the percentage of directors receiving at least 80% of vote cast FOR; and, the percentage of directors receiving at least 90% of vote cast FOR. The analysis also indicates the percentages of shares OPPOSED in three tiers (at least 50% opposed; at least 20% opposed; and at least 10% opposed). “OPPOSED” is defined as the null set, i.e., it includes the sum of all votes cast Against, Abstain, and Withhold. Elections with plurality voting are treated as though they were held under a majority voting standard. * Director elections occurring after January 1, 2010 include only votes for which actual instructions are received from brokers’ beneficial account holders. “Un- instructed broker votes” are no longer voted by brokers on behalf of their clients. “Broker votes,” therefore, are eliminated from both the numerator (votes cast) and the denominator (votes present) in the reporting of votes on director proposals.

3 Scope 2010 Proxy Season2009 Proxy Season DirectorsMeetingsDirectorsMeetings Notice & Access4, , Non-Notice & Access9,6561,74110,1801,832 Totals14,5882,50814,4392,508

4 Outcome for Each Director, On Average The Percentage of the Vote Cast FOR Was Greater Without the Broker Vote Proxy Season (Without Broker Vote) 2009 Proxy Season (With Broker Vote) Shares Voted FOR as a Percent of Shares Voted Notice & Access Non-Notice & Access Total Strong “ownership bias” continues to be observed.

5 The Percentage of the Vote Cast FOR Was Greater in Meetings that Included the 452 Educational Insert. * 2010 Proxy Season (Without Broker Vote) 2009 Proxy Season (With Broker Vote) Shares Voted FOR as a Percent of Shares Voted Insert Included94.2n.a. Insert Not Included92.9n.a. Total * A total of 1,157 companies included an insert in the 2010 sample. Of these, 305 used Notice & Access.

6 Comparing the Two Proxy Seasons, the Percentage of Directors Failing to Receive a Majority of the Vote FOR Increased from 1.0% to 1.3%. Yet, Strong Support Further Strengthened, and Negative Sentiment Weakened Proxy Season2009 Proxy Season Percentage of Directors Receiving at Least 50% of the Vote FOR Percentage of Directors Receiving at Least 50% of the Vote OPPOSED Percentage of Directors Receiving at Least 80% of the Vote FOR Percentage of Directors Receiving at Least 20% of the Vote OPPOSED Percentage of Directors Receiving at Least 90% of the Vote FOR Percentage of Directors Receiving at Least 10% of the Vote OPPOSED Findings are consistent with prior Broadridge analyses indicating that although the broker vote impacts the timing of quorum attainment for corporate issuers, it has little impact on the outcome of director elections. Refer to Broadridge comment letter to SEC file no. SR-NYSE , March 27, 2009, and report to the Council of Institutional Investors, February 3, 2009.

7 Observations On average, there was greater support for director candidates in the 2010 proxy season (without the broker vote) than there was in the 2009 proxy season (with the broker vote):  On average, directors received 93% of the vote FOR in 2010 vs. 92.5% of the vote FOR in  A greater percentage of directors received 80% or more of the vote FOR in 2010 vs (90% of directors received at least 80% of the vote FOR in 2010 vs. 88.9% in 2009).  A greater percentage of directors received 90% or more of the vote FOR in 2010 vs ((81.2% of the directors received at least 90% of the vote FOR in 2010 vs. 79.1% in 2009). On average, a greater percentage of directors failed to receive a majority of votes FOR in the 2010 proxy season (without the broker vote) than in the 2009 proxy season (with the broker vote).  In 2010, 1.3% failed to receive at least 50% of the vote FOR. In 2009, 1.0% failed to receive at least 50% of the vote FOR. Negative sentiment appeared to be somewhat more concentrated in 2010 than it was in The elimination of the broker vote had little impact on the outcome of director elections, especially considering that plurality elections were computed as though they were held under a majority voting standard. Separately, other analyses have examined the impact of the broker vote on the timing of quorum attainment. This continues to be a concern for many issuers. During the 2009 proxy season, just under one-half of all un-instructed broker votes were reported on a proportional basis; that is, the un- instructed shares were voted in the same proportion as actual instructions received (on a broker-by-broker basis). Therefore, the impact of the elimination of the broker vote was less pronounced than it might have been had all broker votes been cast FOR directors in On average, during the 2010 proxy season, there was greater support for director candidates among companies that utilized Notice & Access (93.6%) than there was among companies that did not use Notice & Access (92.7%). On average, during the 2010 proxy season, there was greater support for director candidates among companies that included a 452 insert with their proxy materials (94.2%) than among those that did not include an insert (92.9%).