Investment
Office
P.O. Box
2749
Sacramento,
CA 95812-2749
Telecommunications
Device for the Deaf - (916) 795-3240
Telephone:
(916) 795-2731; Fax (916) 795-2842
May 13,
2008
Dear
Shareowner of Tech Data Corporation:
VOTE FOR PROPOSAL #3 –
PROVIDE SHAREOWNER ADVISORY VOTE ON COMPENSATION
I am
writing to you on behalf of the California Public Employees’ Retirement System
(CalPERS). CalPERS is the largest public pension system in the U.S.,
with approximately $240 billion in assets. We manage retirement benefits and
health insurance on behalf of nearly 1.5 million members. CalPERS is a
significant long-term shareowner of Tech Data Corporation owning
approximately 703,000 shares. We are requesting your support for
Proposal #3 at the June 4, 2008 Annual Meeting of Shareowners to allow
shareowners the opportunity at each annual meeting to ratify executive
compensation.
PAY FOR FAILURE AT TECH
DATA
Shareowners
of Tech Data have witnessed stock underperformance relative to the Russell 3000
index and its industry peer index over the 1-, 3-, and 5-year time
periods ending April 30, 2008:
|
Time Period
Ending
4/30/2008
|
Tech Data
Corp
(TECD)
|
Russell
3000
Index
|
Relative
Return
Tech Data to
Russell 3000
Index
|
Wholesalers
Russell Industry
Peer Index
|
Relative
Return
Tech Data to
Peer
Index
|
|
5 years
|
39.81%
|
71.60%
|
-31.79%
|
123.53%
|
-83.7%
|
|
3 years
|
-7.99%
|
28.21%
|
-36.21%
|
23.60%
|
-31.59%
|
|
1 year
|
-5.43%
|
-5.16%
|
-0.28%
|
0.18%
|
-5.61%
|
Source:
Factset
|
|
Ø
|
As disclosed in the 2008 Proxy
Statement, the Board awarded pay increases to themselves as directors and
executive management while delivering significant long-term absolute and
relative stock underperformance to
shareowners.
|
PROPOSAL #3 SEEKS ANNUAL
NON-BINDING SHAREOWNER SAY-ON-PAY
A
non-binding shareowner advisory vote on executive compensation would enhance
constructive communication between shareowners and the board on the topic of
compensation while improving transparency in setting executive
pay. Directors should be held to a high standard of accountability in
explaining and justifying compensation policies and decisions in terms of
aligning executive performance with the creation of shareowner
value. An advisory vote would inform management and the board of
shareowner views without involving shareowners in the micromanagement of
executive compensation decisions. Shareowner voting results of an
advisory vote would:
Tech Data
Corporation
May 13,
2008
Page
2
|
|
Ø
|
Promote substantive dialogue,
encourage independent thinking by the board, and stimulate healthy debate
for the purpose of holding management accountable for stock
performance.
|
ANNUAL ADVISORY SHAREOWNER
VOTE: A POSITIVE GLOBAL BEST PRACTICE
CalPERS
believes communicating non-binding shareowner sentiment (Positive or Negative)
about executive compensation is an effective alternative to withholding vote
from individual directors. Shareowners are serious about holding
their director representatives accountable for compensating executives. However,
withholding votes from compensation committee members can send a mixed message
for registering dissatisfaction for the way a compensation committee administers
compensation plans and policies.
Today,
Boards in the United States including Aflac, Verizon, RiskMetrics, Par
Pharmaceuticals, and Blockbuster have concluded that submitting executive
compensation practices and philosophies to shareowners for ratification is the
right thing to do.
Other
countries, such as the United Kingdom and Australia, allow shareowners to cast
an advisory vote on executive compensation practices resulting in no apparent
negative ramifications to shareowner value.
|
|
Ø
|
An executive compensation
advisory vote is the RIGHT
THING TO DO as
evidenced by corporate adoption and support
globally.
|
YOU CAN HELP – VOTE “FOR”
PROPOSAL #3
CalPERS
believes that approval of Proposal #3 will send a strong message to the Tech
Data Board to improve compensation policies, while having a positive impact on
shareowner value.
|
|
Ø
|
Send a powerful message by
voting “FOR” proposal #3 on the proxy card. The results of such a vote
would, we believe, provide useful information about whether shareowners
view senior executive compensation practices, as reported each year, to be
in shareowners’ best
interests.
|
|
|
Ø
|
Publicize your vote to further
unite and encourage investors to support this
campaign.
|
DO NOT BE MISLED BY TECH
DATA
|
|
Ø
|
If you are an investor and find
yourself under pressure from Tech Data to vote against this proposal, ask
yourself why defeating this initiative – which is intended to improve
board accountability, shareowner rights, and shareowner value – is so
important to them.
|
Please
refer to the proxy statement for more information or call The Altman Group, Inc.
who is assisting us with this effort toll-free at (800) 314-9816 or at (201)
460-1200 if you have any questions or need assistance in voting your
shares.
Sincerely,
Dennis
Johnson, CFA
Senior
Portfolio Manager
PLEASE NOTE: CalPERS is not
asking for your proxy card. Please do not send us your proxy card
but return it to the proxy voting agent in the envelope that was provided to
you.