2018 Guide to Effective Proxies

2.2 Board/CEO letter | 35 6 TH EDITION | GUIDE TO EFFECTIVE PROXIES FIRSTENERGY CORP FREEPORT-MCMORAN, INC. FTI CONSULTING, INC. GATX CORPORATION A message from your independent Chairman, independent Chairman-Elect and CEO March3 0 , 2018 DearFellowShareholder: Thankyouforthetrustyouhaveplacedinus.AsyourBoardtransitionstonewleadership,weremaindedicatedtorepresenting yourinterestsandcreatinglong-termvalueforourshareholders.YourBoarddemonstratesaccountabilitythroughcommitmentto ongoingshareholderoutreachandengagementandstrongcorporategovernancepractices.Inaddition,yourBoardutilizesitsdeep knowledgeanddiversebackgroundtoguideandsupportmanagement’simplementationofitsregulatedstrategy,whichis designedtotransformtheCompanyintoahigh-performing,fullyregulatedutilitywithwell-definedgrowthopportunities.YourBoard willcontinuetoworkwithmanagementasitimplementsthisstrategy,whichisoutlinedinthe 201 7AnnualReporttoShareholders. Inthisproxystatement,youwillfindareviewofyourBoard’scorporategovernancephilosophy,including: Š ShareholderOutreachandEngagement YourBoardlistenstoourshareholdersandconsiderstheirviewswhenmakingdecisionsintheboardroom.We accomplishthisprimarilythrougharobust,year-roundshareholderoutreachandengagementprograminpartnership withyourCompany’smanagement.Pleaserefertopage 1 7foradetaileddiscussionofthisprogram. Š ExecutiveCompensation EnsuringthatyourCompanyhasanexecutivecompensationprogramthatappropriatelyincentivizesouremployeesand alignspaywithperformanceisanimportantresponsibilityofyourBoard.In 201 7andearly 2018 ,yourCompensation Committeeundertookarobustprocesstoreviewourexecutivecompensationstructure,incorporatinginputfromour shareholderoutreachandengagement.Asaresult,yourCompensationCommitteeandBoardadoptedseveralchangesto ourcompensationprogramforawardsgrantedbeginningin 2018 ,including(i)simplifyingandimprovingthecalibrationof thelong-termincentiveplandesignstructure,(ii)eliminatingtheannualgoal-settingapproachinthelong-termincentiveplan andmovingto3-yearcumulativegoals,(iii)adoptingtwofinancialgoalsfocusedontheregulateddistribution,regulated transmissionandcorporate/othersegments’cumulativeoperatingEPSgrowthandaveragecapitaleffectiveness,and (iv)addingarelativetotalshareholderreturn(“TSR”)modifierincludingacapattargetpayout( 100 %)iftheCompany’s absoluteTSRforthethree-yearperformanceperiodisnegative.Further,yourCompensationCommitteeandtheBoard addedaTSRmodifiertothelong-termincentiveprogram’sopencyclesforcertainexecutivestoensurepayoutsarealigned with3-yearTSRgrowthforshareholders.Thesechangesaredescribedbeginningonpage49ofthisproxystatement. Š BoardCompositionandSuccession YourBoard’sCorporateGovernanceCommitteeisfocusedonthemakeupofyourBoardtoensureithastherightmix ofskillsandexperiencesaswellasanappropriatebalanceofinstitutionalknowledge,diversityandfreshperspectives. Wecontinuouslyreview,evaluateandassessourBoardcompositionthroughavarietyofmeans,includingourannual Board,committeeandindividualdirectorevaluationprocess,andseektofurtherenhanceyourBoard’scomposition throughourcomprehensivenominationprocessandongoingconsiderationofpotentialBoardcandidates. Since 201 3,wehavecontinuedtoexpandthediversityofyourBoardwhileelectingsevennewdirectors.Ournew independentBoardChairmanisexpectedtoassumetheroleinMay.Inaddition,inthepastyearwechangedthe compositionofeachofourfiveBoardcommittees,witheachcommitteehavingatleastonenewmember.Webelieve thesechangesdemonstrateourcommitmenttoensuringfreshperspectivesandaninfusionofnewenergyonour Board.Pleaserefertopagesiiiand 1 4foradetaileddiscussionofourBoardcompositionandsuccessionplanning. WealsowanttotakethisopportunitytointroduceMs.SandraPianalto,ournewestmemberelectedbyyourBoardin February,andtoalsothankourcolleagues,WilliamCottleandGeorgeSmart,whowillberetiringfromyourBoardasof the 2018 AnnualMeeting.WejoinourfellowdirectorsinwelcomingSandyandthankingBillandGeorgefortheir commitmenttoyourBoard.Theirleadershipandservicehasbeenappreciated. WeencourageyoutoreadmoreaboutyourBoard,ourstrongcorporategovernancepractices,andourexecutive compensationprogramsinthisproxystatement.WearegratefulforyoursupportofyourCompanyandyourBoard,andthank youinadvanceforvotingpromptly . Sincerely, CharlesE.Jones PresidentandChiefExecutiveOfficer DonaldT.Misheff BoardChairman-Elect GeorgeM.Smart BoardChairman LETTER TO STOCKHOLDERS DearFellowStockholders, Weappreciate theopportunitytoprovideyouwithour2018proxystatementandupdateyouonourcompany’s corporate governance,executivecompensation,andotherimportantmatters. StrongExecutionofourStrategy. In2017,management,withtheboard’s oversight,achievedstrongoperating performance throughoutourglobaloperations.Weremainedfocusedongeneratinglong-termvaluefor stockholdersthroughourlarge-scaleandgeographicallydiverseportfoliooflong-livedcopperreserves and resources.Thefollowingreflects2017and2018year-to-date highlights: • Effective,ongoingcostmanagementandcapitaldiscipline • Generationofstrongcashflow • Restorationofourbalancesheetstrength • Developmentofattractiveorganicoptionsforfuturegrowth • Achievementofimportantprogress forlong-termstabilityforourIndonesianoperations • Reinstatement ofourcommonstockdividendandafinancialpolicytobalanceadditionaldeleveraging, disciplinedinvestments,andthereturnofexcesscashtoourstockholders Yourboardremainscommittedtocontinuingitsactiveoversightrole,whichincludesareviewofstrategyboth duringourformalboardmeetingsandthroughouttheyearaswecounselmanagementoutsideoftheboardroom. RespondingtoFeedbackonExecutiveCompensation. Settingexecutivecompensationandguidingthe compensationprocessforthecompanyisacoredutyoftheboard.Wemustseteffectiveincentivesthatmotivate ourexecutiveteamandalignwithourbusinessstrategy.Wecapturestockholderfeedbackthroughaboard-led engagementoutreachprogramandintegratethatfeedbackintodecisionsregardingthecompany’sgovernance, compensation,andsustainabilitypractices.Overthecourseofthepastyear,weengagedindiscussionswithmany ofourinvestorstoensurethatweidentifiedappropriateresponsiveactionfollowingwhattheboardviewedasa disappointinglevelofstockholdersupportforour2017say-on-payproposal.Asdetailedinthisproxystatement, theboardhastakenseveralactionstocontinuetheevolutionofourexecutivecompensationprograminorderto respondtoourstockholders’requests.Theboardgreatlyvaluedthesubstantive,thoughtfulfeedbackour stockholdersprovidedus,andweappreciatethetimeandattentionourstockholdersdevotedtotheseextensive outreachefforts. SocialandEnvironmentalSustainability. Werecognizethat,asaminingcompany,ourworkimpactsthe environmentandcommunitiessurroundingouroperations.Maintainingstrongcommunityrelationshipsatour operationalsiteswhileensuringmarketaccessforourproductsthroughoutthevaluechainisvitalforusto achieveourbusinessgoals.Wedothisbyoperatingsafely,respectinghumanrights,meetingresponsible sourcingobjectivesofourcustomersandsociety,engagingwithstakeholders,andinvestinginsocialprograms. Ourcorporate responsibilitycommitteeassiststheboardinoverseeing themanagementofrisksassociatedwith environmentalmanagement,communitydevelopment,healthandsafety,humanrights,climate-relatedimpacts, andwater management. Webelievethatthetrendtodevelopsustainablesolutionsisanimportantbusinessopportunityforus.Copper is anecessary componentinmanynewtechnologiestobolsterenergy efficiencies,advancecommunications,and enhancepublichealth,includinghigh-efficiencymotors,electricvehiclesandrenewable energy. YourVoteandVoiceMatter. Atthisyear’sannualmeeting,welookforwardtohearingyourviewsandweaskfor yourcontinuedsupportasweworktogethertomaximizethelong-termvalueofyourinvestmentinourcompany. Webelievethefuturewillbe“PoweredbyCopper”andwearefocusedongeneratingvalueforyou,our stockholders,bydeliveringsuperiorexecutionofourstrategy. Thankyouforbeingastockholderandforyourrole inthelong-termsuccessofourcompany. Respectfullyyours, GERALDJ.FORD Non-ExecutiveChairmanoftheBoard April24,2018 March24,2017 DearShareholders: On behalf of the Board of Directors, I invite you to attend GATX Corporation’s 2017 Annual Meeting of Shareholders on Friday, May 5, 2017, at 9:00 a.m. Central Time, at The Northern Trust Company, 50 South LaSalle Street, Sixth Floor Assembly Room, Chicago, Illinois. Enclosed you will find a notice setting forth the items we expect to address at the meeting,ourproxystatement,aformofproxy,andacopyofour2016annualreporttoourshareholders. GATX had another record year in 2016, producing earnings per diluted share of $6.29, earning a return on equity of 19.6%, paying more than$67millionindividends, repurchasingmore than$120millionofcommon stock,andinvesting nearly $621 million in our businesses around the globe. This performance was especially impressive given that we were operating in an industry experiencing reduced railcar loadings, improved railroad efficiency, and declining industry lease rates for the second consecutive year. Lookingforward, ourstrategyforshareholdervalue creationisdiscussedindetail inmy2016lettertoshareholders,whichisincludedinourannualreport. Your vote is very important. Whether or not you plan to attend in person, please ensure that your shares are represented at the meeting by promptly voting and submitting your proxy by Internet or telephone, or by signing and returningyourproxycardintheenclosedenvelope. On behalf of the Board of Directors and management, I would like to thank you for your continuedsupportofGATX. We hopeyouwillbeabletoattendthemeetingandlookforwardtoseeingyouthere. Sincerely, ChairmanoftheBoard, President and Chief Executive Officer ImportantNoticeRegardingtheAvailabilityofProxyMaterials FortheShareholdersMeetingtobeheldonMay5,2017. The Company’s Proxy Statement for the 2017 Annual Meeting of Shareholders, the Annual Report to Shareholders for the year ended December 31, 2016, and the Company’s Annual Report on Form 10-K for the fiscalyearendedDecember31,2016,areavailableat:www.envisionreports.com/GATX. 55512 th StreetNW Washington,DC20004 +1.202.312.9100 April24,2018 DEAR FELLOW SHAREHOLDERS: OnbehalfofourBoardandastheNon-ExecutiveChairman,wewouldliketotakethisopportunitytoreflectonthesignificantprogress madeintransformingFTIConsulting,Inc.sincetheBoardselectedStevenGunbyasourChiefExecutiveOfficer. Overthepastfouryears,theCompanyhasexecutedonitsstrategicgoals,drivendisciplinedfinancialandoperationalperformance,and enhancedshareholderreturns.AsIdiscussedwithmanyofyouduringourconversationsoverthepastfewyears,thishasbeena significantundertakingonwhichwehavemadegreatprogressandbetterpositionedtheCompanyforthefuture. OurOngoingTransformation Steve’sleadershipandfreshperspectivehavebeeninstrumentalinpositioningFTIConsultingforitsnextstageofgrowth.Alongwiththe talentedexecutiveteamhehasassembled,Stevehasdevelopedandledseveralfinancialandoperationalinitiativesthathaveenabledour professionalstodeliversustainedbusinessgrowthasdemonstratedbyGAAPEPSandAdjustedEPSincreasing91%and41%,respectively, overthelastthreeyears,andmorerecentlybytheAdjustedEBITDAgrowthinthesecondhalfof2017. SteveandhisteamhaveledthisprocessbytransformingFTIConsultingfromalargelysiloed,acquisition-drivenorganizationtoamore integratedorganicgrowthfocusedfirm.Strongfinancialperformanceanddisciplineduseofcash,alongwithstockpriceappreciationof 47.4%fromthedateofourlastannualmeetingonJune7 th ,2017throughApril13 th ,2018,reflectscontinuingprogressonourongoing transformation.Whilewearepleasedwiththeprogresstodate,ourBoardandmanagementfullyrecognizethatthereismoretodoand weremainfocusedonourlong-termstrategicpriorities. WebelievetheCompanyisataninflectionpointinthistransformationwhereitcanbegintoaccelerategrowthwhileinvestingin initiativesthatsupportourpracticeofattractingandretainingthehighestqualityprofessionaltalent. ShareholderFeedbackandResponsiveness InadditiontotheCompany’stransformationoverthelastfewyears,theBoardhasfocusedoncontinuingtomoveforwardwithbest-in- classcorporategovernancepractices.ThisincludestheestablishmentofanindependentChairmanrole,andconductingrefreshmentto ensureourBoardconsistsofdirectorswiththerightbalanceoftenure,expertiseandperspectivetobeeffectiveinouroversightofthe developmentandexecutionofCompanystrategy.AcoreinitiativeoftherefreshmentprocesswastoincreasethediversityofourBoard,a quarterofwhichisnowcomprisedoffemaledirectorsandaquarterofwhichisbasedoutsideoftheUnitedStates,tobetterreflectour globalclienteleandoperations. OurBoardiscommittedtomaintaininganopendialoguewithshareholdersandconductedrobustshareholderengagementsincelast year’smeeting.Thechangesapprovedforthe2018executivecompensationprogramsdemonstrateourresponsivenesstoshareholder feedback.ThesechangesaredescribedintheCompensationDiscussionandAnalysissectionoftheProxyStatementstartingonpage29. Weremaincommittedtotheprinciplesoftransparency,clearcommunication,alignmentofpaywithperformanceandbestpracticesin governancethatprotectandgrowshareholdervalue. OurPathForward SteveandthemanagementteamremainfocusedonFTIConsulting’sstrengths:industry-leadingtalentwithdiverseanddefinitive expertise,solidandexpandingpositionsacrossaglobalfootprintandastrongbalancesheetwithadisciplinedapproachtocost management.OurBoardisconfidentthattheCompany’sdiverselinesofbusinessstandonfirmplatformsforgrowthandthattheright leadershipteamisinplacetoexecuteonnearandlong-termopportunities. Thankyouforyourcontinuedsupportthroughoutthistransformationandfortheopportunitytosharesomeofthekeychangesunderway atFTIConsulting.Wewelcomeyourfeedbackaswemoveforwardtogether. GerardE.Holthaus ChairmanoftheBoard