June 10, 2020

Shareholder Activism in the Technology Sector: Activism in a COVID-19 World

Jen Fitchen ([email protected]) Partner, Co-Chair of Mergers and Acquisitions Practice Kai Liekefett ([email protected]) Partner, Co-Chair of Shareholder Activism Practice Derek Zaba ([email protected]) Partner, Co-Chair of Shareholder Activism Practice

Private & Proprietary Shareholder Activism in the Technology Sector Contents

• Introduction • The Activism Landscape • Current Topics of Interest and Implications for Shareholder Activism – Technology M&A Market – Capital Allocation – Guidance – Poison Pills • Recommendations

Appendices Appendix: Sidley Activism Practice and Speaker Bios

SIDLEY AUSTIN LLP Private & Proprietary 2 The Activism Landscape Past Crises have Driven Change in Activism Landscape

Pre-2001 2000s 2010s

• Conversations driven • Actively managed funds still • Index funds are largest by active managers growing but index funds shareholders and begin Shareholder • Proxies voted from gaining share supporting activists with smaller ownership Bases the mailroom • Proxy voting teams established • Index fund influence at major institutional investors • Actively managed funds is limited shrinking and consolidating

• Majority voting, special • Structural defenses • Classified boards dismantled at meeting rights, proxy access Legal intact largest companies; other Defenses/ defenses begin to crack commonplace • Poison pills • Normal course poison pills Governance commonplace • Backlash against poison pills largely non-existent

• Barriers to entry for activist ? • “Corporate Raiders” • Advent of modern activism funds come down Activism • Largely driven by M&A • Rise of balance sheet activism Landscape thesis; hostile takeovers and financial engineering • Size of company is not a barrier to activist attack • Rise of operational activism • Increased import of ESG Financial Frauds/ Great COVID-19 Sarbanes-Oxley Recession/ Dodd-Frank

SIDLEY AUSTIN LLP Private & Proprietary 3 The Activism Landscape The Activism Wave Continued into the Start of 2020 Shareholder Activism was Near Record Levels in 2019

Campaigns Proxy Fights

400

375 350 364 349 336 342 300 245

271 250 261 238 200

150

100 105 106 105 92 93 97 88 81 50 77

0 2011 2012 2013 2014 2015 2016 2017 2018 2019

Source: FactSet

SIDLEY AUSTIN LLP Private & Proprietary 4 The Activism Landscape The COVID-19 Impact • COVID-19 “killed” the proxy season for proxy contests o Numerous quick settlements o Many activists decided not to nominate slates o Only a few proxy fights (lowest number of proxy contests in 20 years), mostly at smaller capitalization companies

• Numerous other factors relevant to activism were also affected o The M&A market came to a screeching halt; focus shifted towards distressed M&A o Some industries were disproportionately impacted, increasing the possibility of opportunistic hostile M&A o ISS and Glass Lewis indicated more lenient policies on short-term “poison pills,” more than 50 companies have adopted o Capital allocation plans were shelved: “COVID-19 leads to logistical impediments and companies drew down credit lines, cut dividends shifts in timing and strategy, but, importantly, and withdrew guidance also creates opportunities for savvy investors.” Schulte Roth & Zabel LLP, o “Virtual only” annual meetings became the norm Leading activist law firm (March 2020)

SIDLEY AUSTIN LLP Private & Proprietary 5 The Activism Landscape Expectations for the Future

• Expect new wave of activism later in 2020 o Large activists will weather the storm; some see the “opportunity in a generation”: Starboard, Elliott, Carl Icahn, Pershing Square, Third Point o Smaller activists faced a greater risk of capital redemptions and business closure o However, the quick rebound in the stock market may result in far fewer fund closures than initially expected • Activist strategies and tactics will evolve o In times of uncertainty, shorter and simpler theses, such as M&A and capital allocation, are more attractive to activists Activism After the Financial Crisis o However, M&A and capital allocation theses will need to conform to current environment Proxy Contests 150 • Hostile takeovers will continue to be a threat for 133 130 certain industries 110 87 93 o The 11 year bull-market made it hard to buy 90 companies 70 In some industries, even a 100% premium to 50

o filings DEFC14A of # current share price is often below 52 week high 2004-08 Avg. 2009 2010-19 Avg.

SIDLEY AUSTIN LLP Private & Proprietary 6 The Activism Landscape COVID-19 Impact on TSR by Industry

TSR for Technology Companies has been Relatively Unaffected

Year-to-Date Total Shareholder Return (TSR) by Industry Technology 20 Non-technology

10

0

-10

-20

-30

-40

-50

-60

Source: S&P Capital IQ. Universe is companies with primary exchange in the United States and market cap greater than $50 million. As of May 31, 2020.

SIDLEY AUSTIN LLP Private & Proprietary 7 Topic of Interest: The M&A Market for Technology Companies Technology M&A: Down but Not Out • M&A activity has been down across the board, anywhere from 25% to over 50% depending on the market size, geography and industry measured

• In the last economic downturn, distressed deal volume increased as many companies have no alternative

• However, in the technology sector:,

– Capital is more available than in 2008

– According to the latest edition of the EY Global Capital Confidence Barometer, “the technology sector appears to be more confident in the deal outlook than other sectors, with 70% expecting to see the M&A market improve in the short-term compared with 56% of non-technology respondents.”

– Fortune recently reported that the cohead of global M&A at Goldman Sachs “expects to see deals in the healthiest of sectors—think tech and health care—and the least viable sectors, like energy. In healthy sectors, M&A will strive for growth, while in the latter, it’s all about survival.”

SIDLEY AUSTIN LLP Private & Proprietary 8 Topic of Interest: The M&A Market for Technology Companies Key Conditions for M&A Activity in a Downturn • Consensus on Valuation. Value uncertainty and mismatched valuation expectations are the biggest impediments to M&A activity. Market volatility is the enemy of deal-making. • Need. On the sell-side, financially distressed companies with limited access to capital or growth opportunities may be compelled to transact. On the buy-side, if conditions threaten longer-term financial sustainability, acquisitions may become a critical part of the business strategy. • Synergies. Faced with downward pressure on margins and growth, particularly in markets with an existing leader with a strong market position, smaller companies may look to consolidate with competitors so as to more effectively compete again the leader. • Leveraging Strength. Well-positioned buyers may be able to withstand deal risk in uncertain times to opportunistically acquire companies to increase strength in existing areas, expand into new ones and shore up areas of weakness. • Available Capital. Whether through “dry powder,” financing, access to capital markets or stock-for- stock deals, buyers must have, and be willing, to invest in M&A. • Investor Support. Investor reaction to deal-making is never more important than in turbulent times. A bad deal, or failure to make a deal, may be the very thing that leads investors to support an activist campaign.

SIDLEY AUSTIN LLP Private & Proprietary 9 Topic of Interest: The M&A Market for Technology Companies Implications for Technology General Counsel • Know how to use all the tools in your deal kit and tailor the details to the deal, whether it’s:

– an acquihire to add key engineers and IP from a small startup whose investors are backing out,

– a “pre-packaged 363” bankruptcy sale that lets you acquire assets and leave (almost all) liabilities behind,

– a rep and warranty policy that covers you when your purchase price is largely devoted to paying off creditors, or

– a stock-for-stock deal to preserve cash and provide upside to offset valuation disagreements.

• Focus on the drivers. Of course you want the “best” deal terms, but what that means for your deal may differ significantly depending on whether your deal is driven by need, to achieve synergies or to leverage strength.

• Mind the message. What the company and the counterparty communicate about the deal to their investors, employees, customers and partners will be of paramount importance to fully realizing the expected benefits of the deal and avoiding investor backlash.

• Be prepared for unwanted suitors and interlopers. Demands for “exploration of strategic alternatives” and agitation against announced transactions are more attractive to activists in this environment, particularly in the healthiest sectors. Be ready for the increased risk with a “break-the- glass” plan that includes contingency communications planning, identifying a crisis team, understanding your structural options and how to effectively deploy them.

SIDLEY AUSTIN LLP Private & Proprietary 10 Topic of Interest: Capital Allocation Impact on Activist Demands to Return Capital % of Companies in an Industry that… • Capital allocation demands Easy to analyze and understand; 100% ... Pay A Dividend o 90% does not require any operational 80% expertise; short duration 70% Technology Non-technology Were 60% o less likely to be the main 50% focus over the past decade, but 40% were frequently paired with other 30% activist objectives 20% 10% o Likely to be an increased 0% divergence of opinions within ... Cut Their Dividend investor bases 100% 80%

60% Four tech • Technology industries remain industries with no vulnerable 40% dividend cuts 20% o Fewer technology companies cut dividends; however most do not 0% pay a regular dividend 70% ... Hold Net Cash Above 10% of Market Capitalization o Many tech industries continue to 60% hold substantial net cash 50% 40% 30% 20%

Source: S&P Capital IQ. Dividend information as of May 15, 2020; 10% Net cash information as of May 31, 2020. 0%

SIDLEY AUSTIN LLP Private & Proprietary 11 Topic of Interest: Financial Guidance Activist Pressure to Increase Guidance • “Guidance Pressuring” % of Companies in an Industry that… o Pressuring companies to issue ... Provide Financial Guidance more aggressive guidance is 100% 90% becoming a more common tactic Technology 80% o Facilitates activist campaign in Non-technology following year if targets not 70% achieved 60% 50% o Large and mega-cap 40% companies, where 13D 30% disclosure requirements are not 20% triggered, are more vulnerable 10% o COVID-19 related guidance 0% withdrawals are widespread, creating more opportunities for ... Withdrew Their Financial Guidance activists to utilize this tactic 60% • Technology sector remains at higher 50% risk of guidance pressure 40% o Quarterly or annual financial guidance plays larger role in 30% certain tech industries One tech industry 20% with no guidance o “Business model” guidance more withdrawals common in less mature industries 10%

Source: S&P Capital IQ. Dividend information as of May 15, 2020; 0% Net cash information as of May 31, 2020.

SIDLEY AUSTIN LLP Private & Proprietary 12 Topic of Interest: Poison Pills Recent “Poison Pill Wave” • The COVID-19 pandemic has generated and continues to generate significant volatility in the stock market • The high levels of trading volume and volatility, along with the use of derivatives, make it extremely difficult for stock watch services to detect rapid stock accumulations

• This situation creates and enhanced risk that an activist or hostile bidder could quietly accumulate a significant stake in a company

• From March 1 through May 31, at least 57 public companies have adopted shareholder rights plans either in response to a specific threat or as a preventative measure, with more expected in coming weeks

• On April 8, ISS issued new guidance noting that while it would consider situations on a case-by-case basis, a “severe stock price decline as a result of the COVID-19 pandemic is likely to be considered valid justification in most cases for adopting a pill of less than one year in duration.” On April 11, Glass Lewis followed suit and issued similar guidance

SIDLEY AUSTIN LLP Private & Proprietary 13 Topic of Interest: Poison Pills The Impact of Market Capitalization Adoptions are Largely Occurring Across the Market Capitalization Spectrum

Higher concentration 30% around $500mm market capitalization 24% 25% Limited adoptions for larger capitalization 20% companies

15% 14% 11% 11% 10% 10% 10% 10% 10% 10% 10% 10% 10% 10%

% Companies of % 10% 8% 8% 8% 8% 5% 5% 3%

0%

Market Capitalization Range ($mm)

Universe Rights Plans Adoptors

Source: S&P Capital IQ; Sidley estimates. Universe is companies with primary exchange in the United States and market cap greater than $50 million. As of May 14, 2020.

SIDLEY AUSTIN LLP Private & Proprietary 14 Topic of Interest: Poison Pills The Impact of Industry and Total Shareholder Return (TSR) Poison Pills are Concentrated in a Few Industries and/or Adopted by Companies Substantially Underperforming the Market

Five industries account for 2/3 of More than 75% of Rights Plans rights plans adopted Adopters have TSR below –46%

Distribution of Rights Plan Adopters Companies Rights Plans by TSR by Industry by Industry 80% 75% 70% 60% 50% 40% 30% 20% 20% 20% 20% 20%

% Companies of % 20% 10% 8% 10% 3% 3% 0% <-46.2% -32.5% to -18.5% to 0% to - > -0.9% Energy and Energy Services -46.2% -32.5% 18.5% Non-Food and Drug Retail Total Shareholder Return Since January 2, 2020 Media Leisure Aerospace and Airlines Universe Rights Plans Adoptors

Source: S&P Capital IQ; Sidley estimates. TSR measured from January 2, 2020 until the time of adoption. As of May 14, 2020.

SIDLEY AUSTIN LLP Private & Proprietary 15 Topic of Interest: Poison Pills Considerations for Adoption in the Technology Sector Factor Description Industry Risk Some industries have been hit harder than others and are therefore, more vulnerable. Industry Moreover, smaller players in industries that have been consolidating are more vulnerable. Low Companies whose stock prices have declined significantly more compared to those of their TSR/ competitors may also face a greater threat. Additionally, if a company’s trading multiple Low Relative Value (or other indicia of value) is lower than those of its peers, it may be perceived as a particular bargain and may therefore, be more at risk.

Trading High trading volumes make a company more vulnerable to a surprise attack. Varies by company; generally Volume Thinly-traded companies are less at risk. higher than most sectors Market Large-cap companies are less at risk than smaller companies because few insurgents have the Varies Capitalization financial wherewithal to spend billions of dollars on a single position.

Companies with a controlling shareholder or large insider ownership are more or less immune Low Shareholder from an activist campaign or hostile takeover. By contrast, having significant free float makes a (more likely to have higher Base inside ownership or dual-class company more vulnerable to a surprise attack. structure) Presence of If a company has already been approached by a hostile bidder or a known activist owns stock, Varies Activist there is a greater risk of attack, particularly if the insurgent’s cash position remains strong. Most public companies’ debt have provisions that trigger a default or put right in the event of a Debt Change Lower change of control, typically ranging from 25% to 50%. The lower the threshold, the higher the risk (less likely to have significant of Control that a rapid stock accumulation and trigger a default. debt) Companies with significant net operating losses (NOLs) should consider a poison pill because rapid shareholder turnover can trigger an “ownership change” pursuant to the Internal Revenue Varies, but generally less likely NOLs Code. A poison pill with a 4.9% trigger threshold can protect a company against such an to have NOLs “ownership change.”

Legal Barriers Certain jurisdictions (e.g., Pennsylvania) and industries (e.g., REITs) already provide certain No industry-specific to Purchases legal barriers for stock accumulations, thereby making a poison pill less necessary. ownership limitations

For most technology companies, the balance of factors weighs in favor of developing a shelf rights plan rather than outright adoption

SIDLEY AUSTIN LLP Private & Proprietary 16 Recommendations How Should Tech Companies Prepare?

1. Response Team: Assemble an activism response team during peacetime to be on standby in the event of an attack; response team to monitor activism trends relevant to the Company 2. Legal Defenses: Ask proxy fight counsel to review the charter, bylaws and other governance documents to assess strengths and weaknesses 3. Corporate Governance: Analyze the company’s corporate governance from an activist campaign standpoint (board composition and practices, compensation, shareholder rights, related party transactions, etc.), as benchmarked against peers 4. Shelf Poison Pill: Prepare a fully drafted and negotiated “shelf” poison pill with up-to-date technology to enable the board to react quickly in the event an activist attacks 5. Communications Plan: Prepare a “break the glass” communications plan with “shelf” press releases and media statements; prepare CEO for unexpected call from an activist 6. Strategy, Financial & Operational: With the assistance of a consulting firm and an investment bank, evaluate the strategy, operations, capital allocation and performance of the company like an activist 7. Investor Relations: Screen meeting/call requests for activists; conduct perception surveys; retain stock surveillance firm

Tabletop Exercise: Conduct a “mock activist fight” session with the company’s management team and board to walk through the various stages of an activist situation

SIDLEY AUSTIN LLP Private & Proprietary 17 Appendix

SIDLEY AUSTIN LLP Private & Proprietary 18 Sidley’s Shareholder Activism Practice Top Law Firm’s Activism Experience Since 2016 Sidley’s Team Members Have Significantly More Experience Than Any Other Top Defense Law Firm at All Stages of Activism Campaigns

# Proxy Contests # Settlement Agreements

The Sidley team Sidley has negotiated lost only three more settlement shareholder votes in its agreements than any past 56 proxy fights other defense law firm 56 33 26 18 20 17 17 18 10 9 13 7 6 7 3 7 7 6 6 5

Source: FactSet (VAULT Top 25 law firms by company representations Source: FactSet (VAULT Top 25 law firms based on notice provisions in in proxy contests with a meeting date in 2016 or later) settlement agreements for activist campaigns starting in 2016 or later)

Note: Includes client matters handled by Sidley team members prior to joining the Firm.

SIDLEY AUSTIN LLP Private & Proprietary 19 Sidley’s Shareholder Activism Practice Select High-Profile Proxy Contest and Activism Client Matters

Knowles Texas Pacific AT&T Argo Group Caligan Potbelly Delek US Land Trust Partners and Elliott International Ancora Carl Icahn & SoftVest and Falcon Edge Management CVR Energy Voce Capital Horizon Kinetics Advisors

United 1 HomeStreet Fujifilm Sempra Energy Technologies Wynn Resorts Roaring Blue AmTrust Xerox, Carl Icahn Third Point Elaine Wynn Elliott Financial & Darwin Deason Lion Capital Management and Pershing Carl Icahn Square

Pandora American NRG Energy PulteGroup Yahoo Media BHP Billiton International Elliott Starboard Corvex Elliott Group Elliott Management & Management & Value Management Management Carl Icahn & 2 Bluescape William J. Pulte Paulson & Co

United The Macerich CenterPoint Continental Cabela’s E. I. du Pont Sysco Energy Elliott de Nemours Company PAR Capital & Land & Trian Fund Management Trian Fund Elliott Altimeter Capital Buildings Management Management Management

1 Represented Fujifilm in proxy contest-related litigation 2 Represented Bluescape in its group with Elliott Management Note: Client in bold. Includes client matters handled by team members prior to joining the Firm.

SIDLEY AUSTIN LLP Private & Proprietary 20 Sidley’s Shareholder Activism Practice Activism Defense League Table Rankings

Sidley is Top-Ranked in all Shareholder Activism League Tables

No. 1 in FactSet Activism Advisory No. 2 in Bloomberg’s Activism League No. 2 in Refinitiv’s Global Shareholder Rankings for Company Representations Tables for Company Representations in Activism Scorecard for Company in Q1 2020 2019* Representations in 2019*

From Activist Insight Monthly: “This was the busiest year of my career,” Kai Liekefett, co-chair of Sidley’s shareholder activism practice, told Activist Insight Monthly. In August, Derek Zaba joined Liekefett in heading the group. “In addition to his much-needed help, Derek also brings skill sets and perspectives that I just don’t have: the perspective of the former activist and investor, which is extremely helpful. He really complements our offering and increases the services that we can provide to clients,” Liekefett said. This year Sidley worked on a handful of high-profile situations, including defending Texas Pacific Land Trust against a trio of activists, Argo Group against Voce Capital Management, and MiMedx against former CEO Pete Petit. The law firm was also rumored to be working with AT&T No. 1 among Defense Law Firms in in its bout with Elliott Management. “It was an extraordinary year because Activist Insight’s 2019 Intermediary Award* of the kind of campaigns that ultimately kept us busy for long stretches of the year,” Liekefett said. * By market cap (for companies with a market cap of $100 million and more)

SIDLEY AUSTIN LLP Private & Proprietary 21 Speaker Bios JENNIFER F. FITCHEN (Co-Leader of Sidley’s M&A Practice)

Jen is the global co-leader of the firm’s mergers and acquisitions practice. She is also the former chair of the ABA’s Acquisitions of Public Companies Subcommittee. Jen counsels public and private companies on both friendly and hostile acquisition transactions, divestitures and spin-outs, mergers-of-equals, going-private transactions, deals involving earnouts and contingent value rights, and complex structures such as inversion, double-dummy and reverse morris trust transactions. Her experience includes transactions that are truly one-of- a-kind. Jen’s experience includes hundreds of transactions involving in excess of $230 billion in value and nearly 25 years practicing in Northern California.

Recognized as “one of Silicon Valley’s leading M&A lawyers handling complex technology and life sciences transactions,” Jen lectures around the country on M&A-related matters, including at events hosted by Stanford University, the American Bar Association, the Association of Corporate Counsel, Practicing Law Institute and other professional organizations. PARTNER Jen has been ranked in Chambers USA: America’s Leading Lawyers for Business in the category of Palo Alto Corporate/M&A every year since 2010. In 2012, she was honored by Chambers USA with a “Women in Law” award in the category of Up & Coming Corporate/M&A Lawyer of the Year. LMG Life Sciences has recognized +1 650 565 7122 (o) her as a “Life Sciences Star” every year since 2015. Jen was recognized in the 2018 edition of Who’s Who Legal: M&A and Governance. She has been named to The Recorder’s list of “Women Leaders in Technology Law” [email protected] multiple times and was also recognized by The Daily Journal as one of the Top 100 leading lawyers in California. Jen has been recognized multiple times by Super Lawyers and The Legal 500 as a leading M&A practitioner in Northern California. In 2015, a Q&A with Jen was featured in the Huffington Post Business section. In 2019, BTI Consulting, on the basis of a nomination by a corporate counsel at a Fortune 500 company, named Jen as a member of the BTI Client Service All-Star Team for law firms. Jen earned her J.D., cum laude, from the Georgetown University Law Center and graduated with a B.A. in Business-Economics from the University of California, Los Angeles, magna cum laude, with college honors distinction.

Select Recent Experience • Representing Centerview Partners LLP as financial adviser to the Independent Transaction Committee of the Board of Directors of Sprint Corp. in connection with proposed combination of Sprint and T-Mobile US, Inc., in stock-for-stock merger with implied enterprise value of approx. $59 billion for Sprint; approximately $146 billion for combined company • Sale of Siebel Systems, Inc. to Oracle Corporation in a cash, stock election “double-dummy” merger valued at approximately $5.8 billion • Combination of Angie’s List with IAC’s HomeAdvisor business, creating a new publicly traded company, ANGI Homeservices Inc., with a combined value of approximately $5 billion • Sale of Pandora Media to Sirius XM in a stock-for-stock merger valued at approximately $3.5 billion • Sale of Quantum Effect Devices to PMC-Sierra, Inc. in a stock-for-stock merger valued at approximately $2.3 billion • Sale of Dionex Corp. to Thermo Fisher Scientific in a two-step cash tender offer valued at approximately $2.1 billion • Acquisition by Roche of Ignyta, Inc. in a two-step cash tender offer valued at approximately $1.7 billion • Splunk’s acquisition of SignalFx for $1.05 billion in cash • Sale of Move Inc. (Realtor.com) to News Corp. in a two-step cash tender offer valued at approximately $1 billion

SIDLEY AUSTIN LLP Private & Proprietary 22 Sidley’s Shareholder Activism Practice KAI HAAKON E. LIEKEFETT (Co-Leader of Sidley’s Shareholder Activism Practice)

Kai co-leads Sidley’s Shareholder Activism Practice. He has 20 years of experience in corporate law in New York, London, Germany, Hong Kong and Tokyo. He spends 100% of his time on activism campaigns and proxy fights, and in the last 5 years, Kai has been involved in over 50 proxy contests, more than any other defense attorney in the country. Under Kai’s leadership, Sidley rose to the top of the activism defense league tables in 2019, including the No. 1 ranking by FactSet (for companies with a market capitalization of $100 million or more) and No. 2 ranking by Bloomberg (by aggregate market capitalization). Kai has been named “2019 Dealmaker of the Year” by The American Lawyer for Sidley’s groundbreaking Wynn Resorts proxy contest. He has been recognized in the 2017, 2018 and 2019 editions of Chambers USA as one of only seven leading attorneys for Corporate/M&A: Takeover Defense. Kai speaks regularly about shareholder activism on panels and at universities around the world. He is frequently interviewed and quoted as an activism thought leader by the national and international media, PARTNER including CNN, The Wall Street Journal, CNBC, The New York Times, Bloomberg, Reuters, Financial New York Times, USA Today, Forbes, Law360 and The Deal. Kai sits on the board of the New York Chapter of the NACD. +1 212 839 8744 (o) Kai holds a Ph.D., magna cum laude, from Freiburg University; an EMBA, summa cum laude, from Münster +1 646 256 8315 (c) Business School; and an LL.M., James Kent Scholar, from Columbia Law School. He was in the top 0.1% nationwide in his First Legal State Exam (J.D. equivalent) and in the top 1.5% nationwide in his Second [email protected] Legal State Exam in Germany.

Select Recent Experience • AT&T in its activism campaign defense against Elliott Management • Delek US in connection with a potential unsolicited takeover bid by Carl Icahn and CVR Energy • Potbelly Corporation in its proxy contest defense against the company’s founder and former CEO • Big Lots in its proxy contest defense against Macellum and Ancora • Argo Group International in its proxy contest defense against Voce Capital • Texas Pacific Land Trust in its proxy contest defense against SoftVest and Horizon Kinetic • Elaine Wynn in her proxy contest against Wynn Resorts • Fujifilm in its proxy contest-related litigation against Xerox, Carl Icahn and Darwin Deason • HomeStreet in its proxy contest defense against Roaring Blue Lion Capital • Knowles in its proxy contest defense against Caligan Partners and Falcon Edge Capital • Cat Rock Capital in its activism campaign against Just Eat • AmTrust Financial in its proxy contest defense against Carl Icahn

SIDLEY AUSTIN LLP Private & Proprietary 23 Sidley’s Shareholder Activism Practice DEREK O. ZABA (Co-Chair of Sidley’s Shareholder Activism Practice)

Derek is a partner in the Palo Alto and New York offices and co-chairs Sidley’s Shareholder Activism Practice. Over the past two decades, he has been involved in dozens of activist campaigns and proxy contests in various advisory and principal capacities. He spends 100% of his time on shareholder activism campaigns and proxy fights. Prior to Sidley, Derek was the head of the activism defense practice at a leading shareholder engagement and corporate governance advisory firm and served as a Partner and investment professional at activist and event driven hedge funds. Derek’s clients are located worldwide with sizes across the market cap spectrum. He has helped dozens of public companies successfully navigate activist situations worldwide and across a wide range of industries. He has defended against the vast majority of top tier activist hedge funds, as well as many others including one time and occasional activists. He has counseled management teams and directors on hundreds of engagements with proxy advisory firms and institutional investors relating to shareholder activism, contested M&A, corporate governance and other matters. PARTNER Palo Alto & New York Derek holds a J.D. from Stanford Law School, where he graduated Order of the Coif; an MBA from the Olin School of Business at Washington University in St. Louis, concentrating in Finance; and a bachelor’s +1 650 565 7131 (o) degree in Systems Science and Mathematics, cum laude, from the School of Engineering and Applied +1 212 839 5684 (o) Science at Washington University in St. Louis. +1 917 825 3015 (c) Select Recent Experience [email protected] • AT&T in its activism campaign defense against Elliott Management • Delek US in connection with a potential unsolicited takeover bid by Carl Icahn and CVR Energy • Big Lots in its proxy contest defense against Macellum and Ancora • Argo Group International in its proxy contest defense against Voce Capital • AMAG Pharmaceuticals in its proxy contest defense against Caligan Partners • >$50B industrial company in its activism defense against Third Point and Pershing Square • $25B utility company in its proxy contest defense against Elliott Management • $50B computer company in activism defense against Carl Icahn and Elliott Management • >$50B basic materials company in its activism defense against Elliott Management • Yahoo! in its proxy contest defense against Starboard Value • $25B distribution company in its activism defense against Trian • Fiesta Restaurants in its proxy contest defense against JCP Partnership • Simpson Manufacturing in its proxy contest defense against Iron Compass Note: Includes client matters handled prior to joining the Firm. • ARIAD Pharmaceuticals in its activism defense against Sarissa Capital

SIDLEY AUSTIN LLP Private & Proprietary 24 Disclaimer

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