SAY ON PAY RESULTS RUSSELL 3000 APRIL 3

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1 THIS REPORT CAN BE ACCESSED AT SEMLER BROSSY 2013 SAY ON PAY RESULTS RUSSELL 3000 APRIL VOTE RESULTS 100% 148 COMPANIES WITH REPORTED VOTES IN 2012 AND % 100% 2012 VOTE RESULTS

2 2013 RUSSELL 3000 SAY ON PAY RESULTS 1 SUMMARY OF VOTE RESULTS (163) 75% of companies have passed Say on Pay with over 90% shareholder approval 2011: 72% 2012: 73% 94% of companies have passed Say on Pay with over 70% shareholder approval 2011: 93% 2012: 91% No additional companies have failed since last week s report; three Russell 3000 companies (1.8%) have so far failed Say on Pay Companies are: Nuance Communications, Digital Generation, and Navistar 2011: 37 (1.4%) 2012: 57 (2.6%) 2013 SAY ON PAY VOTE RESULTS 100% 1.4% 2.6% 1.8% 6% 6% 4% 75% 21% 19% 19% PERCENT APPROVAL Below 50-70% 72% 73% 75% 70-90% 25% 90%+ 0% 2011 (n = 2,651) 2012 (n = 2,213) 2013 (n = 163) Source: Semler Brossy data and analysis; Fund Votes LLC. Notes: As of April 1, The 2013 sample includes companies that had an Annual Meeting and Say on Pay vote in calendar year Year over year data presented in this document does not reflect a constant sample given turnover in the Russell 3000 or timing (Say on Pay became mandatory on January 21, 2011). Russell 3000 sample effective as of the beginning of June 30, 2012.

3 2013 RUSSELL 3000 SAY ON PAY RESULTS 2 VOTE OF THE WEEK: TYCO Tyco received 69% on Say on Pay in 2013, following 95% in 2012 and 71% in Tyco received a decrease in support despite strong TSR performance and a positive investor reaction to its September 2012 corporate spin-off. Investors and their proxy advisors likely maintained concerns about the value of the former CEO s termination package. Tyco spun-off two of its businesses in September 2012; following completion, the CEO and Chairman resigned from his role as CEO, though remained Non-Executive Chairman His resignation triggered a good reason termination under the employment agreement; he received approximately $7.5m in cash severance, $35.1m in accelerated equity, and $3.5m in additional retirement benefits OUTCOME 69% 95% 71% 1-YR TSR +41% +13% +9% 3-YR TSR +20% +8% -4% CEO PAY ($000s) 2 $30,553 $20,380 $19,869 REVENUE $10.4B $17.4B $17.0B COMPANY PERFORMANCE Positive total shareholder return over a one-, three-, and five-year basis In September 2012, Tyco completed a spin-off into three distinct businesses (Tyco, Pentair, and ADT) PAY PROGRAM FOR 2012 Annual incentive plan for 2012 tied to operating income growth, organic revenue growth, and cash conversion Long-term incentives (LTI) made through performance-based stock (weighted for CEO; 40% for all other NEOs), options ( for CEO; 40% for all other NEOs), and time-based RSUs (0% for CEO; 20% for all other NEOs). In 2012, the performance shares were tied to an equal weighting of Return on Invested Capital and relative TSR and, given the spin-off, were measured over a nine month period The CEO s resignation at the time of the company separation triggered a good reason termination. The CEO, who remains as Non-Executive Chairman, received $30.6m in reported pay in 2012, which includes a $7.5m severance benefit. Tyco also accelerated vesting of the majority of the CEO s outstanding equity (valued at $35.1m) and provided an additional $3.5m pension benefit under his SERP Actual total compensation (as reported in the SCT) increased roughly year over year for the outgoing CEO FOR 2013 Eliminated excise tax-gross ups for NEOs Added a double-trigger requirement before severance benefits will be paid under a change-in-control Reduced CEO severance multiple from 3x to 2x base salary + target bonus Ended practice of providing a cash perquisite allowance to officers Performance shares for 2013 have a three-year performance period and are tied to EPS, with a relative TSR modifier Target total compensation for the new CEO (post spin-off) is roughly $7m ISS PROPOSAL SUMMARY EXCERPTS A vote AGAINST this proposal is warranted because the company paid a significant severance package, accelerated outstanding equity awards, and provided additional retirement benefits to the combined CEO and chairman who resigned from his position as CEO but will continue to serve as chairman. Source: Semler Brossy analysis, ISS Voting Analytics. 1 Financials as of the three most recently disclosed fiscal year ends (i.e., FYE2012, FYE2011, and FYE2010). FY2010 and FY2011 figures represent Tyco prior to the spin-off; FY2012 figures represent post spin-off. Total revenues are $10.4B, $10.6B, and $11.0B in 2012, 2011, and 2010, respectively, reflecting the distribution of ADT and Pentair as discontinued operations. 2 As disclosed in the Summary Compensation Table.

4 2013 RUSSELL 3000 SAY ON PAY RESULTS 3 HOW VOTE RESULTS CHANGED IN 2013 Average vote results have improved by approximately 2% year over year Thus far, two companies that failed in 2012 (Actuant and International Game Technology) received significantly more support in 2013 (+52%) 2012: Overall, companies that failed in 2011 received 39% more support. Of 35 companies, all but four passed in 2012 Companies that received 50-70% in 2012 are receiving 26% more support on average 2012: Overall, companies that received 50-70% in 2011 received 13% more support To date, 104 companies (94%) have passed all three years, while seven companies (6%) have passed in two years and failed in one year AVERAGE VOTE RESULT CHANGE BY 2012 VOTE BRACKET PRIOR YEAR RESULT # AVERAGE CHANGE IN 2013 AVERAGE CHANGE IN 2012 Under 2 +52% +39% 50-70% % +13% 70-90% 29 +5% +2% Above 90% 106-2% -3% TOTAL % -1% Source: Semler Brossy data and analysis; Fund Votes LLC. Note: Year over year data presented in this document does not reflect a constant sample given turnover in the Russell 3000 or timing (Say on Pay became mandatory on January 21, 2011).

5 % of ISS Recommendations % of Total ISS Against Recs RUSSELL 3000 SAY ON PAY RESULTS 4 IMPACT OF PROXY ADVISORS ON VOTE RESULTS ISS has recommended that shareholders vote against Say on Pay at about 9% of companies it has assessed : 12% 2012: 14% On average, shareholder support was 24% lower at companies with an ISS against : 25% 2012: 30% IMPACT ON VOTE RESULTS 2 ISS For ISS Against 12% 14% 10% 88% 86% 90% Avg. Vote: For: 94% Against: 69% Avg. Vote: For: 94% Against: 64% Avg. Vote: For: 94% Against: 70% Source: (n Semler = 2,651) Brossy data and analysis; (n Fund = 2,213) Votes LLC; ISS Voting Analytics. (n = 163) 2013 SAY ON PAY VOTE BREAKDOWN (163) SAY ON PAY VOTE RESULTS WITH ISS AGAINST RECOMMENDATION (17) 2 For Against 40% 100% 30% 29% 29% 75% 20% 18% 12% 25% 10% 6% 6% 0% Below - 60% 60% - 70% 70% - 80% 80% - 90% Say on Pay Vote Result 90% - 95% Above 95% 0% Below - 60% 60% - 70% 70% - 80% 80% - 90% Say on Pay Vote Result 0% 90% - 95% Above 95% Source: Semler Brossy data and analysis; Fund Votes LLC; ISS Voting Analytics. 1 Based on ISS assessment of 353 companies, of which 31 have received against from ISS; 163 have reported vote results. 2 Reflects only those companies whose vote results have been reported.

6 2013 RUSSELL 3000 SAY ON PAY RESULTS 5 IMPACT OF PROXY ADVISORS ON VOTE RESULTS YEAR OVER YEAR ISS has switched its Say on Pay recommendation at 54 (16%) companies year over year 2012: 17% Say on Pay vote results continue to be impacted significantly when ISS switches its recommendation year over year Company responses to an against recommendation from ISS did not appear to have a material impact on vote results in 2011 or 2012; sample size is currently limited for 2013 (5) YEAR OVER YEAR ISS RECS (330) 1 For in 2012 and 2013 (268) For in 2012; Against in 2013 (19) Against in 2012; For in 2013 (35) Against in 2012 and 2013 (8) 2% 11% 6% AVERAGE SAY ON PAY VOTE RESULTS ISS For in 2012 Against in 2013 (9) -17% 81% +30% Source: Semler Brossy data and analysis; Fund Votes LLC; ISS Voting Analytics. DEFA 14A RESPONSES TO PROXY ADVISORS YEAR ISS Against in 2012 For in 2013 (18) 2011 For, 2012 Against: -26% 2011 Against, 2012 For: +27% 69% 70% 71% 64% 67% 67% 62% 60% 75% Source: Semler Brossy data and analysis; Fund Votes LLC; ISS Voting Analytics All ISS 'Against' Source: Semler Brossy data and analysis; Fund Votes LLC; ISS Voting Analytics. 1 Includes only companies with recommendations in 2012 and 2013; also includes companies that have yet to report vote results. Note: Year over year data presented in this document does not reflect a constant sample given turnover in the Russell 3000 or timing (Say on Pay became mandatory on January 21, 2011) ISS 'Against', Company Did Not Respond with a DEFA14A ISS 'Against', Company Responded in a DEFA14A

7 2013 RUSSELL 3000 SAY ON PAY RESULTS 6 APPENDIX: 2013 SAY ON PAY VOTE RESULTS COMPANIES UNDER IN Failed Say on Pay Vote Results 1 Russell 3000, 3 Meeting S&P FYE 2012 Say on Pay Vote Results TSR (as of FYE 2012) Company Date GICS Industry 500 Revenue YOY 1-Yr 3-Yr 5-Yr Nuance Communications Inc 01/25/13 Software $1,652 41% 77% -35% 22% 18% 5% 2 Digital Generation Inc 02/21/13 Media $387 39% % -27% -16% Navistar International Corp 02/19/13 Machinery $12,948 18% 71% -54% -55% -17% -22% 1 As of April 1, Digital Generation held its annual meeting in calendar year 2013 (2/21/13), but the vote results relate to FY2011 compensation. Source: Semler Brossy data and analysis; Fund Votes LLC.

8 2013 RUSSELL 3000 SAY ON PAY RESULTS 7 APPENDIX: 2013 SAY ON PAY VOTE RESULTS LIKELY CAUSES OF VOTES UNDER IN Failed Say on Pay Vote Results 1 Russell 3000, 3 Likely Causes of Votes Under Pay and Rigor of Special Non- Shareholder Problematic Say on Pay Vote Results Performance Performance Awards/ Mega- Performance Benchmarking Outreach and Pay Company YOY Relation Goals Grants Based Equity Practices Disclosure Practices Nuance Communications Inc 41% 77% -35% X X X X Digital Generation Inc 39% - - X X X X Navistar International Corp 18% 71% -54% X X X X X Count (3) As of April 1, Source: Semler Brossy data and analysis; Fund Votes LLC; ISS Voting Analytics.

9 2013 RUSSELL 3000 SAY ON PAY RESULTS 8 APPENDIX: 2013 SAY ON PAY DEFA14A RESPONSES ADDITIONAL MATERIALS FILED AS RESPONSES TO PROXY ADVISORS Summary of Responses to Say on Pay Recommendations from Proxy Advisors 1 Russell 3000, 9 Key Topics Addressed Pay and Peer Proxy Timing Program Changes Filing S&P FYE 2012 Say on Pay Vote Results Performance Group Advisor Factual of Realizable Following Proxy ISS Rec Company (Link to Filing) Date 500 Revenue YOY Relation Comparators Methodology Error Grants Governance Pay Advisor Rec. Reversal Corning Inc 04/01/13 X $8,012-95% - X X No Humana Inc. 03/29/13 X $39,126-94% - X X No Kaman Corp 03/22/13 $1,593-98% - X Yes Hewlett-Packard Co 03/13/13 X $120,357 76% 77% -1% X Yes Walt Disney Co (The) 02/26/13 X $42,278 58% 57% 1% X No Hillenbrand Inc 02/21/13 $983 80% 97% -17% X X No Piedmont Natural Gas Co Inc. 02/19/13 $1,123 76% 82% -6% X X X X No National Fuel Gas Co 02/19/13 $1,627 84% 74% 11% X X X X No Meritor Inc 01/15/13 $4,418 78% 84% -6% X X X X No Count (9) As of April 1, Source: Semler Brossy data and analysis; Fund Votes LLC; ISS Voting Analytics.

2013 RUSSELL 3000 SAY ON PAY RESULTS 9 DATA AT A GLANCE: HOW TO READ OUR COVERS EACH ISSUE COVER ILLUSTRATES AT A GLANCE: year over year change in vote results between 2012 and 2013 EACH DOT

10 2013 RUSSELL 3000 SAY ON PAY RESULTS 9 DATA AT A GLANCE: HOW TO READ OUR COVERS EACH ISSUE COVER ILLUSTRATES AT A GLANCE: year over year change in vote results between 2012 and 2013 EACH DOT REPRESENTS a single Russell 3000 company s vote result, with 2012 on the X-axis and 2013 on the Y-axis COMPANY RECEIVED ABOVE 70% IN 2013 from the current issue pool of Russell 3000 companies. COMPANY RECEIVED BETWEEN TO 70% IN 2013 from the current issue pool of Russell 3000 companies. COMPANY RECEIVED BELOW IN 2013 (FAILED) from the current issue pool of Russell 3000 companies. For more information on Say On Pay results, or how to subscribe to our weekly report, please contact us at dialogue@semlerbrossy.com, or We also welcome you to visit our website for additional articles and thought papers on all aspects of executive compensation. THIS REPORT CAN BE ACCESSED AT Copyright 2013 Semler Brossy Consulting Group, LLC. Distributed By Semler Brossy Consulting Group, LLC. The unauthorized disclosure, use, or dissemination of this report or any of its contents is prohibited. SEMLER BROSSY

THIS REPORT CAN BE ACCESSED AT

THIS REPORT CAN BE ACCESSED AT HTTP://WWW.SEMLERBROSSY.COM/SAYONPAY Thousands The CEO Pay Ratio, comparing annual total compensation of a company s CEO and median employee, is a required disclosure for