Airgas, Inc. v. Air Products: Staggered Boards Staggered (What About Those Special Interest Directors)(Part 4)

We are discussing Airgas, Inc. v. Air Products, a recent decision out of the Delaware Chancery that validated a bylaw shortening the time between annual meetings to three months.

In the world of shareholder access, one of the most significant concerns has been the use of the authority to elect “special interest” directors, candidates that will act in the interests of the nominating shareholder rather than all shareholders.   The usual response is to assert that directors must be elected by all shareholders and that special interest directors will not be elected.  The battle is one of assertion.  Only with experience will a definitive answer emerge.

Nonetheless, anecdotal evidence suggests that shareholders wanting to win contests must nominate highly qualified persons to the board. 

This was apparently the case in Airgas.  Although the case centered around a bylaw, shareholders at the same meeting elected three insurgent directors to the board.  Who were these "special interest" directors?  They included:

John P. Clancey

Mr. Clancey, 65, has more than 22 years of experience as both CEO and Chairman of complex international businesses, and 16 years of experience serving on the boards of large public companies across a range of industries.  He is currently Chairman Emeritus of Maersk Inc. and Maersk Line Limited, a division of the A.P. Moller - Maersk Group, one of the world’s largest shipping companies.  Mr. Clancey previously served as Chairman of Maersk Inc., where he managed the company’s ocean transportation, truck and rail, logistics and warehousing and distribution businesses, and as Chief Executive Officer and President of Sea-Land Service, Inc.  Mr. Clancey is currently a Principal and founder of Hospitality Logistics, International, a furniture, fixtures and equipment logistics services provider serving customers in the hotel industry, and a member of the Board of Directors of Livingston International Inc., a major international customs house and freight forwarding company.  He has served as a member of the board of directors of UST Inc., Foster Wheeler AG, and AT&T Capital.  Mr. Clancey, a former Captain in the United States Marine Corps, received a B.A. in Economics and Political Science from Emporia State College.

Robert L. Lumpkins

Mr. Lumpkins, 66, has more than 40 years of significant operational, management, financial and governance experience from a variety of positions in major international corporations, covering both developed and emerging countries, and service on public company boards in a wide range of industries.  He is currently the Chairman of the board of directors of The Mosaic Company, a producer and marketer of crop and animal nutrition products and services, a position he has held since the creation of the company in October 2004.  He previously served as Vice Chairman of Cargill Inc., a commodity trading and processing company, until his retirement in 2006, and as Cargill’s Chief Financial Officer from 1989 until 2005.  Mr. Lumpkins currently serves as a director of Ecolab, Inc., a cleaning and sanitation products and services provider; a Senior Advisor to Varde Partners, Inc., an asset management company specializing in alternative investments; and a member of the Advisory Board of Metalmark Capital, a private equity investment firm.  He also serves as a Trustee of Howard University.  He received an M.B.A. from the Stanford Graduate School of Business and a B.S. in Mathematics from the University of Notre Dame.

Ted B. Miller, Jr.

Mr. Miller, 58, has extensive executive, financial and governance experience as a founder, significant shareholder, executive officer and director of both start-up companies and large public companies.  He is the former Chairman and Chief Executive Officer of Crown Castle International Corp., a wireless communications company he founded in 1995 that currently has an equity market capitalization in excess of $10 billion.  He currently serves as President of 4M Investments, LLC, an international private investment company.  He is also the founder, Chairman and majority shareholder of M7 Aerospace LP, a privately held aerospace service, manufacturing and technology company; the founder, Chairman and majority shareholder of Intercomp Technologies, LLC, a privately held business process outsourcing company; and the founder, Chairman and majority shareholder of Visual Intelligence, a privately held imaging technologies company.  Mr. Miller previously served as a member of the board of directors of Affiliated Computer Services, Inc., from November 2008 until its acquisition by Xerox Corporation in February 2010.  He received a J.D. from Louisiana State University and a B.B.A. from the University of Texas.

In short, from all appearances, highly qualified candidates that would appeal to a majority of shareholders.