Allergan today announced that its Board of Directors has approved amendments to the company’s bylaws that streamline the process associated with calling a special meeting of stockholders. The Board determined to amend the bylaws after meetings with many of the Company’s major stockholders and other governance organizations to solicit their input and perspectives. Following these meetings, the Board reached the conclusion that the benefits of certain provisions of the bylaws, as previously formulated, were outweighed by the associated administrative burdens. The amendments announced today underscore Allergan’s commitment to good corporate governance and incorporate the direct feedback of the Company’s stockholders.
“The Board is proactively addressing Allergan’s bylaws to ensure that the December 18, 2014 Special Meeting of Stockholders requested by Pershing Square Capital Management, L.P. is focused on the question of value,” said Michael R. Gallagher, Lead Independent Director of the Board. “Allergan remains confident that it can create more value than Valeant Pharmaceuticals International, Inc.’s offer to acquire the Company’s shares.”
The amended and restated bylaws include the following revisions to the section on stockholder requested special meetings:
•Reduce the information requirement for a Proposing Person (as defined in the bylaws) by removing certain disclosure requirements regarding the Proposing Person and eliminating the requirement that the Proposing Person make disclosures regarding participants, associates and others acting in concert with the Proposing Person;
•Remove the requirement that a Proposing Person must hold shares of common stock of Allergan in record name in order to sign a request for a special meeting;
•Eliminate the requirement that a Proposing Person update the information provided as of 10 business days before the date of a requested special meeting and give a Proposing Person eight business days (increased from five business days) after the record date for a requested special meeting to update the information provided (as the only update required); and
•Require the Board to call a requested special meeting within 90 days of receipt of one or more valid requests, rather than giving the Board full discretion to determine the timing of a requested special meeting.
In addition, while the independent directors each have the authority to direct management to address any topic of the director’s choosing, the Board has also approved an expansion of the prescribed duties of the Company’s Lead Independent Director by adding the following duties to ensure that the Lead Independent Director continues to have a powerful voice:
•Approval of information sent to the Board;
•Approval of Board meeting agendas; and
•Approval of Board meeting schedules to assure there is sufficient time for discussion of all agenda items.
“The Board is very grateful to have received the perspectives of stockholders representing a substantial percentage of Allergan’s shares on these important corporate governance matters,” said Henri A. Termeer, Chairman of the Corporate Governance and Compliance Committee of the Board. “We remain committed to considering the views of all stockholders.”
For more information, Allergan refers interested parties to an 8-K filed today with the SEC, which includes a copy of the bylaws marked to show changes from the previous bylaws as an exhibit. In addition, the complete list of the duties of the Company’s Lead Independent Director can be found in the Company’s Guidelines on Significant Corporate Governance Issues on Allergan’s website.
Goldman, Sachs & Co. and BofA Merrill Lynch are serving as financial advisors to the Company and Latham & Watkins, Richards, Layton & Finger, P.A. and Wachtell, Lipton, Rosen & Katz are serving as legal counsel to the Company.