EGC Corporate Governance Practices (May 2018)

EGC Corporate Governance Practices: A Survey and Related Resources PAGE 1 PART I Aggregated Data for Period from January 1, 2013 Through December 31, 2017 In this section, we present data on an aggregated basis, considering all of the EGC IPOs undertaken in the last five years. Based on these companies, here are our key findings (all figures are approximate): • 84.3% of non-controlled companies had a majority of independent directors at IPO pricing • 69.5% had staggered or classified boards • 59.9% separated the chief executive officer and board chair positions • 67.2% had all independent directors on the audit, compensation, and nominating and corporate governance committees upon completion of the IPO • 93.9% had a “financial expert” on the audit committee at IPO pricing • 45.6% had “exclusive forum” provisions in bylaws • 72.3% had “super majority” shareholder voting provisions • 38.7% allowed shareholders to take action by written consent under specified conditions • 80.1% allowed for proxy access • 7.0% had clawback policies for executive officers. Below we discuss the observed trends in more detail. The Filers We identified the IPOs of 1,023 issuers in the period from January 1, 2013 through December 31, 2017, of which 170, or approximately 16.6%, were not EGCs, and reviewed 848 EGC IPO filings . 1 See Appendix A for a list of the EGC IPOs we reviewed and Appendix B for a summary of the benefits enjoyed by EGCs under the JOBS Act. 2 1 We did not review any EGCs that were business development companies (“BDCs”) because BDCs are subject to the additional requirements under the Investment Company Act of 1940, as amended. For additional information regarding BDCs, see our Frequently Asked Questions about Business Development Companies, available a t https://media2.mofo.com/documents/faq- business-development-companies.pdf . We also excluded five master limited partnership (“MLP”) IPOs. 2 For additional information, see our Frequently Asked Questions about Initial Public Offerings, available at https://media2.mofo.com/documents/faq-ipos.pdf , and our The Short Field Guide to IPOs, available at https://media2.mofo.com/documents/171116-ipo-field-guide.pdf .