H.F. 2196 Section 1. NEW SECTION . 545.1 Definitions. 1 As used in this section, unless the context otherwise 2 requires: 3 1. “Company” means a publicly traded, for-profit 4 corporation, limited liability company, partnership, or other 5 business entity that is organized under the laws of this state 6 and that maintains its principal place of business in this 7 state. “Company” includes a foreign entity that has made 8 a company proposal to become a domestic entity by merger, 9 conversion, or other means. 10 2. “Company proposal” means a proposal by a company to the 11 company’s shareholders that is included in the company’s proxy 12 statement and includes but is not limited to a proposal related 13 to director nominations or elections, executive compensation, 14 corporate transactions, corporate structure, auditor selection, 15 or company policy. 16 3. “Default recommendation” means a system, set of rules, 17 principles, or guidelines to assist shareholders with voting 18 decisions on a company proposal or proxy proposal. 19 4. “Financial analysis” means a written document that does 20 all of the following: 21 a. Analyzes the expected short-term and long-term financial 22 benefits and costs to a company of implementing a company 23 proposal or proxy proposal. 24 b. Reaches a conclusion as to what vote or course of action 25 may positively affect shareholder value. 26 c. Explains the methods and processes used to prepare the 27 financial analysis, including the experience and geographic 28 location of the personnel who prepared the analysis. 29 5. “Proxy advisor” means a person who, for compensation, 30 provides a proxy advisory service to shareholders or to other 31 persons with the authority to vote on behalf of shareholders. 32 6. “Proxy advisory service” means any of the following 33 services that are provided by a proxy advisor in connection 34 with, or in relation to, a company, or are provided to any 35 -1- LSB 5225HH (4) 91 nls/ko 1/ 6

H.F. 2196 person in the state: 1 a. Advice or recommendations on how to vote on a company 2 proposal or proxy proposal. 3 b. Research and analysis regarding a company proposal or 4 proxy proposal. 5 c. Development of proxy voting recommendations or policies, 6 including but not limited to default recommendations. 7 7. “Proxy proposal” means a proposal made by a shareholder 8 of a company that is included in the company’s proxy statement 9 and includes but is not limited to a proposal related to 10 director nominations or elections, executive compensation, 11 corporate transactions, corporate structure, auditor selection, 12 or company policy. 13 8. “Shareholder” means a shareholder, unitholder, limited 14 partner, or other equity owner of a company. 15 Sec. 2. NEW SECTION . 545.2 Proxy advisor services —— 16 enforcement. 17 1. If a proxy advisor provides a proxy advisory service to 18 a shareholder or other person with authority to vote on behalf 19 of the shareholder, or makes a default recommendation against 20 company management on a company proposal or proxy proposal, 21 and the proxy advisory service or default recommendation is 22 not based on a financial analysis, the proxy advisor shall, 23 concurrently with providing the proxy advisory service or 24 default recommendation, do all of the following: 25 a. Provide a clear disclosure to each shareholder or other 26 person with authority to vote on behalf of a shareholder that 27 does all of the following: 28 (1) Identifies the specific proxy advisory service being 29 provided. 30 (2) Identifies the recommendation or policy at issue. 31 (3) States that the proxy advisory service or default 32 recommendation is not based on a financial analysis. 33 b. Except for a proxy advisory service that provides voting 34 recommendations or policies, or a default recommendation, 35 -2- LSB 5225HH (4) 91 nls/ko 2/ 6

H.F. 2196 provide the disclosure under paragraph “a” to the board of 1 directors of each company that is the subject of the proxy 2 advisory service. 3 c. Conspicuously post on the home page of the proxy 4 advisor’s internet site a statement that the proxy advisor’s 5 proxy advisory services include one or more proxy advisory 6 services that involve recommendations or policies against 7 company management on company proposals or proxy proposals that 8 are not based on a financial analysis. 9 2. If a proxy advisor provides a proxy advisory service to 10 a shareholder or other person with authority to vote on behalf 11 of the shareholder, or makes a default recommendation against 12 company management on a company proposal or proxy proposal, 13 and the proxy advisory service or default recommendation 14 is based on a financial analysis, the proxy advisor shall, 15 concurrently with providing the proxy advisory service or 16 default recommendation, do all of the following: 17 a. Provide a clear disclosure to each shareholder or other 18 person with authority to vote on behalf of a shareholder that 19 does all of the following: 20 (1) Identifies the specific proxy advisory service being 21 provided. 22 (2) Identifies the default recommendation at issue. 23 (3) States that the proxy advisory service or default 24 recommendation is based on a financial analysis. 25 (4) States that the financial analysis is available upon 26 request. 27 b. Make the financial analysis available within a reasonable 28 time to any client of the proxy advisory service upon request. 29 c. Provide a copy of the financial analysis to the board 30 of directors of each company that is the subject of the proxy 31 advisory service. This paragraph shall not apply to a proxy 32 advisory service that provides proxy voting recommendations or 33 policies, or a default recommendation. 34 3. A violation of this section is an unlawful practice under 35 -3- LSB 5225HH (4) 91 nls/ko 3/ 6

H.F. 2196 section 714.16. 1 4. An action may be brought in district court to enjoin a 2 proxy advisor’s violation of this section. In any proceeding 3 for an injunction, the aggrieved person bringing the action 4 shall provide written notice of the action to the attorney 5 general no later than seven calendar days after the date the 6 action is filed in district court. The attorney general may 7 intervene in any action for injunctive relief under this 8 subsection. The following persons may bring an action under 9 this subsection: 10 a. An individual who received a proxy advisory service 11 provided by a proxy advisor that violated this section. 12 b. A company, or a shareholder of a company, that is the 13 subject of a proxy advisory service provided by a proxy advisor 14 that violated this section. This paragraph shall not apply to 15 a company that is the subject of a proxy advisory service for 16 the development of proxy voting recommendations or policies 17 including establishment of default recommendations. 18 Sec. 3. Section 714.16, subsection 2, Code 2026, is amended 19 by adding the following new paragraph: 20 NEW PARAGRAPH . t. It is an unlawful practice for a proxy 21 advisor to violate section 545.2. 22 Sec. 4. APPLICABILITY. This Act applies to a proxy advisory 23 service, or a default recommendation, provided by a proxy 24 advisor on or after July 1, 2026. 25 EXPLANATION 26 The inclusion of this explanation does not constitute agreement with 27 the explanation’s substance by the members of the general assembly. 28 This bill relates to proxy advisors and proxy advisory 29 services. 30 The bill sets forth the requirements for a proxy advisor 31 (advisor) that provides a proxy advisory service (service) to a 32 shareholder or other person with authority to vote on behalf of 33 a shareholder, or that makes a default recommendation against 34 company management on a company proposal or proxy proposal. 35 -4- LSB 5225HH (4) 91 nls/ko 4/ 6

H.F. 2196 “Company proposal”, “default recommendation”, “proxy advisor”, 1 “proxy advisory service”, and “proxy proposal” are defined in 2 the bill. 3 If the service or default recommendation is not based on 4 a financial analysis, the advisor shall, concurrently with 5 providing the service or default recommendation: (1) provide a 6 disclosure to each shareholder or person with authority to vote 7 on behalf of a shareholder that meets the requirements of the 8 bill; (2) provide the same disclosure to the board of directors 9 of each company that is the subject of the service, except 10 where the service provides voting recommendations, policies, or 11 default recommendations; and (3) post on the advisor’s internet 12 site a statement that the advisor’s services include one or 13 more services that involve recommendations or policies against 14 company management on company proposals or proxy proposals that 15 are not based on a financial analysis. 16 If the service or default recommendation is based on a 17 financial analysis, the advisor shall, concurrently with 18 providing the service: (1) provide a disclosure to each 19 shareholder or person with authority to vote on behalf of 20 a shareholder that meets the requirements of the bill; (2) 21 upon request, make the financial analysis available within a 22 reasonable time to any client of the service; and (3) provide 23 the financial analysis to the board of directors of each 24 company that is the subject of the service, except for services 25 that provide voting recommendations, policies, or default 26 recommendations. 27 A violation of the bill is an unlawful practice under Code 28 section 714.16. 29 An individual, a company, or a shareholder of a company 30 that received a service provided by an advisor that violated 31 the bill may bring an action in district court to enjoin the 32 advisor’s violation. The party bringing such action shall 33 provide written notice of the action to the attorney general 34 no later than seven calendar days after the date the action 35 -5- LSB 5225HH (4) 91 nls/ko 5/ 6