SEC held open meeting on 11.28.07 to address electronic shareholder forums  and shareholder access

• Adopted amendments to Rule 14a-8 to clarify its longstanding interpretation of that rule
• Adopted amendments to proxy rules to facilitate the use of electronic shareholder forums

Idea that electronic shareholder forums could replace current system for shareholder communications

• Rule 14a-13, Rule 14b-1 and Rule 14b-2 are framework of current system for shareholder communications
• Under these rules, proxy materials are distributed by issuers to street name shareholders
• With limited exception, issuers communicate with beneficial shareholders through bank or broker intermediaries that hold shares in street name

• Beneficial owners are generally categorized as either   non-objecting beneficial owners (NOBOs) or objecting beneficial owners (OBOs)
• Issuers can send annual reports and other communications directly to NOBOs
• However, proxy materials must be distributed to NOBOs and OBOs through intermediaries

• SEC has considered whether technological advances -- such as Internet delivery of proxy materials -- provide feasible and cost effective means for direct communications between issuers and their beneficial owners

• SEC Roundtable on Proxy Voting Mechanics  5.24.07
• Briefing paper  Topic Three

Commentary

• Morgan Lewis  11.29.07
• Dewey & LeBoeuf  11.30.07
• Paul Weiss  1.25.08
• Alston Bird  1.29.08
• Latham & Watkins  January 2008

• A Practitioners Guide To Electronic Shareholder Forums

• Ropes & Gray  3.17.08

Examples can be found at MCI, Verizon and AMERCO

• Each of these examples preceded adoption of final rules concerning electronic shareholder forums at SEC open meeting held on 11.28.07
• MCI Town Hall
• Verizon Shareholder Forum
• AMERCO Stockholder Forum

SEC staff published guide under Section 212 of Small Business Regulatory Enforcement Fairness Act of 1966

• A Small Entity Compliance Guide 2.29.08
• Summarizes and explains Rule 14a-2 (amended) and
  Rule 14a-17 (new)

Recommendation for improved shareholder communication in report titled Restoring Trust:  Corporate Governance for the Future of MCI

• Referred to as Breeden Report  August 2003

• Written by Richard C. Breeden, who served as court-appointed Corporate Monitor in SEC proceedings against MCI (formerly WorldCom)
• Details 78 reforms to improve corporate governance at MCI, including establishment of "town hall" for shareholder communications with MCI board
• Excerpt from Executive Summary:
  Under the recommendations shareholder votes are required to change governance standards, to approve certain types of compensation programs, and in other situations. The board of directors is required to establish an electronic town hall where shareholders will be free to communicate with the board and to propose resolutions for consideration in this electronic facility irrespective of whether the proposed resolution would be allowed under SEC proxy regulations. Resolutions that are adopted through the town hall process must be included in the proxy the following year.
• Recommendation 6.04 (Shareholder Resolution Process)

MCI response to Breeden Report

• 2005 proxy statement  4.20.05

• Corporate Governance disclosure (page 2) reflects unanimous adoption of recommendations by board          of MCI's predecessor
• Notes establishment in 2004 of new corporate governance website for nomination of directors and stockholder proposals through website

• Verizon acquired MCI in January 2006  1.06.06

Law firm commentary

• Wachtell Lipton  8.27.03

News reports

• USA Today  8.26.03

Shareholder Forum  June 2007

• Forum Summary

• Established to examine the relationship of executive compensation incentives to the company's achievement of long term enterprise objectives, as a foundation for considering investor decisions about both capital commitment and voting
• Objective is to facilitate an exchange of information that provides investors with a better understanding of the enterprise goals on which the companys key executives, as well-informed and highly credible decision-makers, have staked their financial and career success

• Conditions of Participation
• Forum Chairman: Gary Lutin
• Organized with support of Association of BellTel Retirees Inc. (members are retired employees of Verizon and its predecessor companies)

Stockholder Forum

• Site created for AMERCO stockholders to post and exchange ideas about the proxy materials for the 2007 Annual Meeting and Webcast of Shareholders and to share information in a productive and civilized way

• AMERCO is one of first companies to implement e-proxy rules for 2007 proxy season

• AMERCO webpage to access proxy materials and online proxy voting

Shareholder Access  Rule 14a-8

Proxy Materials: Internet Delivery

Shareholder Proposals: 2008

NYSE Rule 452