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Investor Presentaiton

Pershing Square Is Not an 8.3% Owner of ADP Pershing Square Misleadingly Represents 8.3% Ownership of ADP In referring to Pershing Square as "the company's largest owner with an 8.3% stake" (1), Bill Ackman is misrepresenting the degree of his investment in ADP "In summary - we want you to elect a major shareholder to the board, in this case it would be me representing Pershing Square. We own 8.3% of the company... this has the effect of sending a very powerful message to the management and the board..." Bill Ackman, "The Time is Now" Presentation, August 17, 2017* More Than 75% of Pershing Square's "Ownership" Is Options Pershing Square owns 2.0% of common stock, not the 8.3% that the fund has claimed since the start of their campaign Pershing Square has wrongly characterized 28 million call options (right to buy the stock in the future) as "ownership" The call options do not provide the right to vote those 28 million underlying shares of common stock in a proxy contest Pershing Square elected not to convert a larger portion of its derivative position prior to the September 8 record date, leaving it with the right to vote only the 8.8 million shares that its 2% ownership represents * Permission to use quotations neither sought nor obtained Sources: SEC filings Notes: 1. 2. Pershing Square Press Release, August 21, 2017. Snapshot of Pershing Square's Current Ownership Security Shares % O/S Cost Basis (2) Common Stock 8,798,442 2.0% $108 Call Options 28,005,233 6.3% $116 Total 36,803,675 8.3% $114 Description of Call Options Over-the-counter and listed call options in ADP common stock with expiration dates ranging from 2020-2021 Pershing Square's derivatives agreement prohibits it from exercising or obtaining voting control Would require an additional ~$2.0B investment by Pershing Square to exercise call options to achieve 8.3% ownership In light of Pershing Square not converting its 28 million call options (equivalent to 6.3% of total shares outstanding) into common stock, Pershing Square is not entitled to any dividend on that 6.3% Cost basis for options is calculated as disclosed cost to purchase plus strike price, per Pershing Square 13D/A, dated 8/31/2017. ADP Copyright 2017 ADP, LLC. 47 A more human resource.
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