DFAN14A 1 tm246697d2_dfan14a.htm DFAN14A

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 14A

(Rule 14a-101)

SCHEDULE 14A INFORMATION

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the Securities Exchange Act of 1934

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Norfolk Southern Corporation

(Name of Registrant as Specified in Its Charter)

ANCORA CATALYST INSTITUTIONAL, LP

ANCORA ADVISORS, LLC

ANCORA ALTERNATIVES LLC

ANCORA BELLATOR FUND, LP

ANCORA CATALYST, LP

ANCORA FAMILY WEALTH ADVISORS, LLC

THE ANCORA GROUP LLC

ANCORA HOLDINGS GROUP, LLC

ANCORA IMPACT FUND LP

ANCORA IMPACT FUND LP SERIES AA

ANCORA IMPACT FUND LP SERIES BB

ANCORA MERLIN INSTITUTIONAL, LP

ANCORA MERLIN, LP

BETSY ATKINS

JAMES BARBER, JR.

WILLIAM CLYBURN, JR.

NELDA CONNORS

FREDERICK DISANTO

SAMEH FAHMY

INVERNESS HOLDINGS LLC

JOHN KASICH

GILBERT LAMPHERE

ALLISON LANDRY

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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Ancora Alternatives LLC (“Ancora”), together with the other participants named herein, intend to file a preliminary proxy statement and accompanying proxy card with the Securities and Exchange Commission to be used to solicit proxies for the election of their slate of director nominees at the 2024 annual meeting of shareholders of Norfolk Southern Corporation, a Virginia corporation (“Norfolk Southern” or the “Company”).

Item 1: On February 20, 2024, Jim Chadwick, President, Alternatives at Ancora, had an interview with Leslie Picker on CNBC. The full text of the interview transcript follows:

Joe Kernen: Over to Leslie Picker. She's bringing us a special interview on an activist campaign against railroad operator Norfolk Southern. So only two of us today, Leslie. We welcome your participation.

Leslie Picker: Well, thank you, Joe. I appreciate that and I appreciate your time, James Chadwick, for a CNBC exclusive. Jim as the president of Alternatives at Ancora, the firm has taken an aggressive activist stance in Norfolk Southern and is releasing its management strategy this morning, which includes changes in the CEO spot and the board. Good morning, Mr. Chadwick. So you've got a deck that you plan to circulate to investors. You've got a website here, a majority of the slate, you're nominating eight directors, and we'll have some full screens that show who those directors are and you are recommending Jim Barber, the former COO of UPS as the CEO of Norfolk Southern. And you put a $420 price target, that's pretty significant upside, more than two thirds of where the shares are currently trading. So why this slate? Why a change in management and why do you think that they can effectuate the kind of value creation that gets to 420 a share for Norfolk?

Jim Chadwick: Thanks for having me today, Leslie. We really appreciate it. Look, as an Ohio based manager, we are deeply invested in this company. It's beyond just dollars and cents. I mean, for us, this is something that's in our own backyard. And I'm referring of course to the East Palestine derailment last year. I think before getting into some of the specifics on the question, just to step back at 30,000 feet, what we want to outline here and what we believe is outlined in the deck is the case for change at Norfolk Southern and why it's so strong. Why we think that we can offer shareholders really an unmatched value proposition here. And I think there are some key points we want to bring up. And first, Norfolk Southern's the worst performing operator in the class one railroad space. And that's measured based on the operating metrics share price performance.

And that's despite having an exceptional workforce, a great customer base, really all that would be needed to be a top performing railroad. But unfortunately, the company has been, in our opinion, mismanaged and the board has made some poor decisions. Secondly, when you look back in 2022, the company had the opportunity to bring in what we think could have been a real operator to turn around the business. And instead they elevated a 30-year company insider with no real operational acumen that really has never even generated growth even formally as a company's CMO. And then third, I think the consequences of poor execution and weak management were epitomized by the East Palestine derailment. And even to this day, since that time, the company's had continued accidents. They had a tragic death of an engineer in the last couple of weeks, as well as multiple derailments in the past 30 days.

But I think when you mentioned what we think we can bring to the table here or how we're going to drive value, I mean, first you look at the slate we put together. We've nominated eight directors, as you had said, and we think all of them are exceptionally strong. And that includes Governor John Kasich, regulatory experts like William Clyburn, rail experts like Gil Lamphere and Sameh Fahmy. The management team we think that we're proposing here is outstanding. Jim Barber, we think is a superstar, former COO at UPS as, as well as Jamie Boychuk, who's really one of the highest regarded rail operators in the country. And so combining those two with Jamie as the COO candidate, but combining those two, really marrying those perspectives between those two individuals, marrying UPS kind of best practices with rail principles, we think that we can drive significant value here to the company.

Leslie Picker: Jim, of course, activism in railroads is a well-traveled line so to speak. But two of the high profile success stories from a dissident standpoint, Canadian Pacific and CSX involved Hunter Harrison, who is a renowned industry vet, known for really inventing and proselytizing precision scheduled railroading. And that's a piece of your push too, even though Norfolk Southern has implemented some key pieces of PSR. But critics will say that it's not the best in terms of safety standards. It lacks the same safety rigor and it can result in sizable layoffs. So as you look at the inefficiencies that you're trying to solve for here, how do you square those two things? Especially as you mentioned, we just reached the one-year anniversary of the East Palestine derailment.

Jim Chadwick: Well, I think for openers, I think the East Palestine derailment wasn't the result of PSR. I mean, what Norfolk Southern runs today in the way that the railroads managed, I mean, poor safety in my opinion, is the function of poor leadership. So I think when you're looking back historically at what has happened in the other rails that have implemented PSR strategies, we think obviously there's been some very notable successes. I think the most recent of which pointing to Hunter and it was CSX in 2017, I think part of the challenge there as he went through implementing that strategy was the timeline he was pushing for was trying to make it happen very fast. And I think part of it had to do with his health at that time. When I look at what we're trying to do here, and you'll see in the presentation, this is not PSR in the true sense of the word.

We look at it as we build on the principles of scheduled railroading, but really, as we've called it a scheduled network or a network of the future, which we plan to detail a lot more about that plan in coming weeks. But effectively it is taking the core principles of scheduled railroading, but layering on top of those other components related. And that's where I mentioned Barbara's network background, but really driving growth, marrying really the operating and marketing functions of a company and focused on merchandise and what you're actually pushing through on your network. But like I said, I am excited about the opportunity to share more of those details as we go forward here. And as Jim and Jamie get a chance to speak here.

Leslie Picker: What's currently your sticking point with the company at this stage? Based on their statements, it seems like they've been engaging in discussion. So where is kind of the line in the sand for each side at this point that would preclude some sort of a settlement?

Jim Chadwick: It's Alan Shaw, I think is what I would say at this point. I mean, the company has been what I would describe as blindly loyal to him in terms of their support, despite his performance. Like I said, the company is the worst performing railroad. It's pretty much worse on every operating metric we could talk about since he's taken over as CEO. I think the view on their side is one of time and our view is the results speak for themselves and disasters speak for themselves. And there has to be accountability. But really I think when you look at what's the sticking point, this company has an early nominating window we had nominated in the last week of November, so it's been over two and a half months of engagement with the company. We have engaged with them frequently and have had quite a bit of communication, but there really has been no movement either on the Alan Shaw front or on a real serious offer in terms of reconstituting the board. And so both of those things we believe are necessary here, I think, to drive the type of value that the shareholders deserve.

Leslie Picker: All right. And it should be worth noting we reached out to Norfolk Southern Representatives first thing this morning to let them know you'd be on. I haven't immediately heard back, but hopefully after this conversation we will get a comment from them. Jim Chadwick, President of Ancora Alternatives, appreciate your time this morning. Andrew, I'll send it back to you.

***

Item 2: On February 20, 2024, Ancora posted the following material to its campaign website at www.movenscforward.com (the “Website”). Copies of the materials posted to the Website are filed herewith.

From time to time, Ancora or the other participants in the proxy solicitation may publish the material, or portions thereof, on the Website in connection with the solicitation of the shareholders of Norfolk Southern.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

The information herein contains “forward-looking statements.” Specific forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and include, without limitation, words such as “may,” “will,” “expects,” “believes,” “anticipates,” “plans,” “estimates,” “projects,” “potential,” “targets,” “forecasts,” “seeks,” “could,” “should” or the negative of such terms or other variations on such terms or comparable terminology. Similarly, statements that describe our objectives, plans or goals are forward-looking. Forward-looking statements are subject to various risks and uncertainties and assumptions. There can be no assurance that any idea or assumption herein is, or will be proven, correct. If one or more of the risks or uncertainties materialize, or if the underlying assumptions of Ancora (defined below) or any of the other participants in the proxy solicitation described herein prove to be incorrect, the actual results may vary materially from outcomes indicated by these statements. Accordingly, forward-looking statements should not be regarded as a representation by Ancora that the future plans, estimates or expectations contemplated will ever be achieved. You should not rely upon forward-looking statements as a prediction of actual results and actual results may vary materially from what is expressed in or indicated by the forward-looking statements. Except to the extent required by applicable law, neither Ancora nor any participant will undertake and specifically declines any obligation to disclose the results of any revisions that may be made to any projected results or forward-looking statements herein to reflect events or circumstances after the date of such projected results or statements or to reflect the occurrence of anticipated or unanticipated events.

Certain statements and information included herein have been sourced from third parties. Ancora does not make any representations regarding the accuracy, completeness or timeliness of such third party statements or information. Except as may be expressly set forth herein, permission to cite such statements or information has neither been sought nor obtained from such third parties. Any such statements or information should not be viewed as an indication of support from such third parties for the views expressed herein.

CERTAIN INFORMATION CONCERNING THE PARTICIPANTS

Ancora Alternatives LLC (“Ancora Alternatives”) and the other Participants (as defined below) intend to file a preliminary proxy statement and accompanying BLUE universal proxy card (the “Proxy Statement”) with the Securities and Exchange Commission (the “SEC”) to be used to solicit proxies for, among other matters, the election of its slate of director nominees at the 2024 annual meeting of shareholders (the “2024 Annual Meeting”) of Norfolk Southern Corporation, a Virginia corporation (“Norfolk Southern” or the “Corporation”).

The participants in the proxy solicitation are currently anticipated to be Ancora Catalyst Institutional, LP (“Ancora”), Ancora Merlin Institutional, LP, (“Ancora Merlin Institutional”), Ancora Merlin, LP (“Ancora Merlin”), Ancora Catalyst, LP (“Ancora Catalyst”), Ancora Bellator Fund, LP (“Ancora Bellator”), Ancora Impact Fund LP Series AA (“Ancora Impact AA”) and Ancora Impact Fund LP Series BB (“Ancora Impact BB”) (each of which is a series fund within Ancora Impact Fund LP) (Ancora, Ancora Merlin Institutional, Ancora Merlin, Ancora Catalyst, Ancora Bellator, Ancora Impact AA and Ancora Impact BB, collectively, the “Ancora Funds”), Ancora Advisors, LLC (“Ancora Advisors”), The Ancora Group LLC (“Ancora Group”), Ancora Family Wealth Advisors, LLC (“Ancora Family Wealth”), Inverness Holdings LLC (“Inverness Holdings”), Ancora Alternatives, Ancora Holdings Group, LLC (“Ancora Holdings”) and Frederick DiSanto (collectively, the “Ancora Parties”); and Betsy Atkins, James Barber, Jr., William Clyburn, Jr., Nelda Connors, Sameh Fahmy, John Kasich, Gilbert Lamphere and Allison Landry (the “Ancora Nominees” and, collectively with the Ancora Parties, the “Participants”).

Ancora Alternatives, as the general partner and investment manager of each of the Ancora Funds and as the investment manager of the Ancora Alternatives separately managed accounts (each an “SMA”), may be deemed to beneficially own in the aggregate 913,180 shares of the Corporation’s common stock, $1.00 par value (the “Common Stock”) held in the Ancora Funds and the Ancora Alternatives SMAs (including 123,500 shares of Common Stock underlying 1,235 American call options held in the Ancora Funds). Ancora Advisors, as the investment advisor to the SMA of Ancora Advisors, may be deemed to beneficially own all of the 270 shares of Common Stock held in the Ancora Advisors SMA. Ancora Group, as the sole member of Ancora Advisors, may be deemed to beneficially own all of the 270 shares of Common Stock held in the Ancora Advisors SMA. Ancora Family Wealth, as the investment advisor to the Ancora Family Wealth SMAs, may be deemed to beneficially own all of the 9,847.28 shares of Common Stock held in the Ancora Family Wealth SMAs. Inverness Holdings, as the sole member of Ancora Family Wealth, may be deemed to beneficially own all of the 9,847.28 shares of Common Stock held in the Ancora Family Wealth SMAs. Ancora, as the sole member of each of Ancora Alternatives, Ancora Group and Inverness Holdings, may be deemed to beneficially own in the aggregate 923,297.28 shares of Common Stock held by the Ancora Funds (including the 123,500 shares of Common Stock underlying 1,235 American call options), the Ancora Alternatives SMAs, the Ancora Advisors SMA and the Ancora Family Wealth SMAs. Mr. DiSanto, as the Chairman and Chief Executive Officer of Ancora, may be deemed to beneficially own in the aggregate 923,297.28 shares of Common Stock held by the Ancora Funds (including the 123,500 shares of Common Stock underlying 1,235 American call options), the Ancora Alternatives SMAs, the Ancora Advisors SMA and the Ancora Family Wealth SMAs. The Ancora Parties beneficially own 923,297.28 shares of Common Stock in the aggregate (including the 123,500 shares of Common Stock underlying 1,235 American call options). Gilbert Lamphere owns 2,000 shares of Common Stock and Sameh Fahmy owns 3,000 shares of Common Stock. All of the foregoing information is as of the date hereof unless otherwise disclosed.

IMPORTANT INFORMATION AND WHERE TO FIND IT

ANCORA STRONGLY ADVISES ALL SHAREHOLDERS OF NORFOLK SOUTHERN TO READ THE PRELIMINARY PROXY STATEMENT, ANY AMENDMENTS OR SUPPLEMENTS TO SUCH PROXY STATEMENT, THE DEFINITIVE PROXY STATEMENT, AND OTHER PROXY MATERIALS FILED BY ANCORA AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. SUCH PROXY MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE SEC’S WEBSITE AT WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS IN THIS PROXY SOLICITATION WILL PROVIDE COPIES OF THE PROXY STATEMENT WITHOUT CHARGE, WHEN AVAILABLE, UPON REQUEST. REQUESTS FOR COPIES SHOULD BE DIRECTED TO THE PARTICIPANTS’ PROXY SOLICITOR.