-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Qjcue/qEcnrIQiRPRGXNzLOd8ckYacb9vDAhpRKF46klEjdVD5U5SHW6IT7NsumA D/WCoZzwJjulybGujTq6Lw== 0000950123-10-032016.txt : 20100405 0000950123-10-032016.hdr.sgml : 20100405 20100405134945 ACCESSION NUMBER: 0000950123-10-032016 CONFORMED SUBMISSION TYPE: DEFA14A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20100405 DATE AS OF CHANGE: 20100405 EFFECTIVENESS DATE: 20100405 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GRACO INC CENTRAL INDEX KEY: 0000042888 STANDARD INDUSTRIAL CLASSIFICATION: PUMPS & PUMPING EQUIPMENT [3561] IRS NUMBER: 410285640 STATE OF INCORPORATION: MN FISCAL YEAR END: 1225 FILING VALUES: FORM TYPE: DEFA14A SEC ACT: 1934 Act SEC FILE NUMBER: 001-09249 FILM NUMBER: 10730467 BUSINESS ADDRESS: STREET 1: 88 11TH AVENUE NE CITY: MINNEAPOLIS STATE: MN ZIP: 55413-1894 BUSINESS PHONE: 6126236000 MAIL ADDRESS: STREET 1: C/O CORPORATION SERVICE COMPANY STREET 2: 380 JACKSON STREET, SUITE 700 CITY: ST. PAUL STATE: MN ZIP: 55101 DEFA14A 1 c57309defa14a.htm DEFA14A defa14a
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On April 5, 2010, Graco Inc. made a video available to Graco associates. A transcript of the video is below. The speaker was Patrick J. McHale, President and Chief Executive Officer.
Script:
Good Afternoon.
This year, Graco received a shareholder proposal from an organization called CalPERS. CalPERS would like to change the rules on how we elect our Board of Directors. All Graco shareholders will have the opportunity to vote on this proposal. Our Board of Directors (of which I am a member) is OPPOSED to this proposal. I would like to explain this issue to you, and am asking that you vote AGAINST this proposal. Even if you only hold a small number of shares, your vote is important. If you don’t vote, it will be easier for this proposal to pass.
CalPERS would like to change the voting standard for Graco Directors. Today, the person with the most votes wins. I believe this is an appropriate standard. CalPERS would like to change the voting rules, and require a Director to get more than 50% of the votes when they are the only person up for election.
I am against this change for a variety of reasons. My primary objection is that this rule may lead to unintended negative consequences at some future date. For example:
Graco has 3 important protections against a hostile takeover.
a)   Our share rights agreement — (commonly referred to as a “poison pill”),
 
b)   Our staggered Board where we elect about 1/3 of our Directors every year,
 
c)   And our voting rules for electing Directors — which CalPERS would like to change.
I do not believe it is in the best interests of Graco shareholders, employees, retirees, channel partners or suppliers to weaken our defenses against a hostile takeover attempt.
This is one reason I suggest you vote AGAINST the CalPERS proposal.
It has become politically incorrect for companies to maintain takeover defenses, and a large number of companies have seen similar shareholder proposals in recent years.
While the odds against us winning this vote are long, we intend to make our case to shareholders.
As a Graco shareholder you are entitled to make your voice heard. Please vote your shares, and I’d ask that you consider voting AGAINST this proposal.
Voting is very easy, you can do it on-line in less than a minute. Your HR representative can show you how to vote on-line, and can also show you how to change your vote should you wish to do so!
Every vote is important. Please vote your shares.
Thank You.

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