8-KOther EventsExhibits & Filings

ILLINOIS TOOL WORKS INC 8-K Report, Corporate Update (Mar 6, 2013)

Filed March 6, 2013For Securities:ITW

Summary

Illinois Tool Works Inc. (ITW) announced on March 5, 2013, that it has extended a prior agreement with Relational Investors LLC and its affiliates (the "Relational Group") for one year. This extension, originally dated March 1, 2013, allows the Relational Group the option to appoint David H. Batchelder to the ITW board of directors at any time before the 90-day period preceding ITW's 2014 Annual Meeting of Stockholders. Should Mr. Batchelder join the board, ITW has committed to re-nominate him for a standard one-year term at the 2014 Annual Meeting. In return for this flexibility, the Relational Group has agreed to support ITW's board nominations throughout the agreement's duration. This development signals ongoing engagement between ITW and a significant activist investor group.

Key Highlights

  • 1ITW extended its agreement with Relational Investors LLC and its affiliates (Relational Group) for one year.
  • 2The extension is effective from March 1, 2013.
  • 3Relational Group has the option to appoint David H. Batchelder to the ITW board.
  • 4The appointment option is available until the ninetieth day prior to ITW's 2014 Annual Meeting of Stockholders.
  • 5If appointed, Mr. Batchelder will be re-nominated by ITW for a one-year term at the 2014 Annual Meeting.
  • 6During the agreement term, Relational Group will support ITW's board nominee recommendations.

Frequently Asked Questions

The extended agreement indicates a continued relationship and potential board representation for Relational Investors LLC, a significant investor group. It provides ITW with stability in its shareholder relations while offering Relational Investors an avenue for direct board influence through the potential appointment of David H. Batchelder.

If appointed, Mr. Batchelder would bring the perspective of Relational Investors to ITW's strategic discussions and decision-making. His re-nomination for a full term at the 2014 Annual Meeting suggests a commitment to longer-term engagement if he joins the board.

In exchange for the option to appoint Mr. Batchelder and the commitment for his re-nomination, the Relational Investors Group has agreed to support ITW's recommended nominees for the board of directors throughout the duration of the agreement.