|Item 1 – Elect 15 Directors
|| FOR each Director
- Each nominee holds or has held senior executive positions, maintains the highest degree of
integrity and ethical standards, and complements the needs of the Company.
- Through their positions, responsibilities, skills, and perspectives, which span various industries and organizations, these nominees represent a Board of Directors (Board) that is diverse and possesses appropriate collective knowledge and experience in accounting, finance, leadership, business operations, risk management, corporate governance, and our industry and subsidiaries' service
|Item 2 – Approve a By-Law amendment to permit proxy access
- The Board believes that the implementation of proxy access in the manner set forth in this
proposal will provide meaningful rights to our stockholders while promoting responsible use of
these rights by stockholders.
- We have proposed a By-Law amendment to provide that any stockholder or group of up to
20 stockholders who has maintained continuous qualifying ownership of at least 3% of our
outstanding shares for at least three years could include a specified number of Director nominees
equal to the greater of 2 nominees or 20% (rounded down) of the number of Directors in our proxy
materials for our annual meeting of stockholders.
- The proposal is the result of the Board's ongoing review of our corporate governance policies, including consideration of a stockholder proposal on this topic that did not pass at the 2015 annual meeting and a similar proposal that was withdrawn after the proponent reviewed the terms of
this proposal, recent corporate governance trends, and our ongoing discussions with our large
- This proposal demonstrates the Board's continuing commitment to strong corporate governance policies and practices that the Board believes are consistent with its goal of creating long-term,
sustainable value for our stockholders.
|Item 3 – Approve an amendment to the Certificate of Incorporation to reduce the supermajority vote
requirements to a majority vote
- Supermajority vote requirements like the ones contained in Article Eleventh of the Certificate
of Incorporation, as amended (Certificate of Incorporation or Certificate), historically have
been intended to facilitate corporate governance stability and provide protection against self-interested
action by large stockholders by requiring broad stockholder consensus to make certain fundamental changes.
- As corporate governance standards have evolved, many stockholders and commentators now view the supermajority requirements as limiting the Board's accountability to stockholders and the
ability of stockholders to effectively participate in corporate governance.
|Item 4 – Approve an amendment to the Certificate of Incorporation to eliminate the "fair price" antitakeover
- The "fair price" provision was designed to deter an acquiring party from using two-tier pricing and similar inequitable tactics in an attempt to take over the Company and help assure fair treatment
of all stockholders in the event of a takeover attempt. The fair price provision was not designed to
prevent a takeover but instead to encourage a potential acquirer to negotiate with the Board to
ensure all stockholders receive adequate consideration for their shares.
- Section 203 of the Delaware General Corporation Law provides similar protections against the type
of transactions the fair price provision was designed to defend against, and the Board believes that
a separate fair price provision in the Certificate is unnecessary.
- Eliminating supermajority voting provisions is considered by many commentators and stockholders to be a best practice in corporate governance.
|Item 5 – Approve a By-Law amendment to permit the
Board of Directors to make certain future amendments to the By-Laws without stockholder ratification
- Our By-Laws currently require that any amendment adopted by the Board be subject to subsequent stockholder ratification. This requirement is not in line with current practices at other publicly-traded
companies and presents a number of challenges. Requiring stockholders to ratify all By-Law
amendments approved by the Board is burdensome, unnecessary, and an inefficient use of Company
- The Board believes that the proposed By-Law amendment includes appropriate limits that will
continue to protect stockholder rights.
- The Board is not permitted to alter, amend, or repeal the 10% threshold required to call a special meeting of the stockholders, quorum requirements, indemnification of Directors, or the By-Law
- The Board will not have the power to alter, amend, or repeal any By-Law adopted by the stockholders which by its terms may be altered, amended, or repealed only by the stockholders.
- The proposed changes to the By-Laws will give the Board the flexibility needed to make administrative changes and be responsive to corporate governance best practices while continuing to protect stockholder rights.
|Item 6 – Conduct an advisory vote to approve executive compensation, often referred to as a say on pay
- We believe our compensation program provides the appropriate mix of fixed and short- and long-term performance-based compensation that ties pay to Company performance, rewards achievement of financial and operational goals and relative TSR, and is aligned with stockholder interests.
|Item 7 – Approve the material terms for qualified
performance-based compensation under the
Omnibus Plan in accordance with Section 162(m)
of the tax code
- The 2011 Southern Company Omnibus Incentive Compensation Plan (Omnibus Plan) was previously approved by stockholders at the 2011 annual meeting.
- Approval of the material terms for performance-based compensation under the Omnibus Plan is being sought to satisfy certain requirements under Section 162(m) of the Internal Revenue Code of 1986, as amended (the tax code), to preserve our ability to deduct, for federal income tax purposes, certain performance-based awards granted under the Omnibus Plan to particular executive officers.
- Stockholders are not being asked to approve additional shares under the Omnibus Plan or approve any changes to the material terms of the performance goals or any other terms of the Omnibus Plan.
|Item 8 – Ratify the appointment of Deloitte & Touche LLP
as our independent registered public accounting
firm for 2016
- The Audit Committee has appointed Deloitte & Touche LLP (Deloitte & Touche) as our independent registered public accounting firm for 2016.
- This appointment is being submitted to stockholders for ratification.
|Item 9 and 10 – Stockholder Proposals
- We have been advised that two stockholder proposals are intended to be submitted at the annual meeting.