FOR IMMEDIATE RELEASE
READ THE ISS REPORT
CRITICAL OF FOREST LABS CORPORATE GOVERNANCE
VOTE THE GOLD PROXY CARD
New York, New York - August 10, 2011 - The Icahn Group announced
today that
Institutional Shareholder Services ("ISS"), one of the leading
independent proxy
voting advisory firms, has criticized Forest Labs for flawed
corporate
governance, the appearance of nepotism, share price performance
and compensation
practices. We think change is needed at Forest Labs and we urge
you to use the
GOLD proxy card to vote. We encourage you to read the ISS report
and view our
related presentation which can be found at
http://www.fixforest.com.
In criticizing Forest Labs corporate governance, ISS makes the
following points:
"The image of the CEO sitting in on the ostensibly independent
directors as
they discuss whether or not to support him is uncomfortably
close to that
of a show trial: A THEATRICAL DEMONSTRATION OF POWER, with a
pre-determined
outcome, in which those with ostensible authority must first and
foremost
demonstrate their zealous personal loyalty to THE ONE WHO HOLDS
REAL
POWER."
"All the subsequent protestations about personal integrity and
independence
RING A LITTLE HOLLOW, when the right course of action - calling
an
executive session to let the unaffiliated outside directors
debate the
issues in private, without any undue influence from insiders -
was both an
OBVIOUS AND EASY CHOICE. That the meeting appears to have been
ORCHESTRATED
FROM THE C-SUITE - the General Counsel, rather than the board's
own outside
advisors, apparently prepared and presented the materials which
shaped the
discussion - does not help matters."
"If there was ever a moment for the independent directors to
take matters
into their own hands, this was it. That they FAILED TO DO SO -
and perhaps
even FAILED TO RECOGNIZE their own responsibility to do so - is
DEEPLY
WORRISOME."(Emphasis Added)
---------------
ISS criticizes the appearance of nepotism in addition to
highlighting corporate
governance concerns:
"However, the fact that the succession plan involves having a
senior
executive - presumably a candidate for the top job - report to
his own
father - who presumably has some influence in the matter - is
ANOTHER BAD
OMEN. SVP Solomon may in fact be the best candidate for the job,
internally
or externally: it is hard to know, if ALL HIS SENIOR LEVEL
EXECUTIVE
EXPERIENCE CAME AT THE FIRM HIS FATHER HAS BEEN RUNNING FOR FOUR
DECADES.
At a publicly-held company, succession planning should never be
confused,
visually or procedurally, with ESTABLISHING A DYNASTY."
"Unaffiliated shareholders SHOULD BE CONCERNED about the degree
to which
the independent directors are truly independent of the
long-serving
Chairman and CEO. Among the RED FLAGS are these directors'
apparent
UNWILLINGNESS TO EXCLUDE THE CEO from high-stakes discussions -
such as the
company's response to threatened regulatory action against him
individually
- in which he is CLEARLY CONFLICTED, and their apparently easy
acceptance
of the FUNDAMENTAL CONFLICT involved in making the CEO's own son
one of his
direct reports." (Emphasis Added)
---------------
On shareholder return, ISS notes:
"... it is still clear that the company's MEAGER RETURNS to
shareholders
over the half decade leading up to the announcement of this
proxy contest
have been SUBSTANTIALLY OUTPACED not just by the specialty
pharma peers,
but even by a blended group of big and specialty pharma
peers"
(Emphasis Added)
--------------
Additionally, ISS rated Forest Labs compensation practices as a
"HIGH CONCERN."
ISS has said that "Despite these concerns about how attentive
the incumbent
directors have been to the practice and responsibility of
director independence,
we do not find, on balance, that the dissident has made a
compelling case that
change is needed at the board level." With all due respect to
ISS, it is hard
for us to understand, with all these problems, what else you
need to make a
compelling case. It seems to us that ISS themselves have made a
compelling case
to remove existing board members.
It is time for change. We strongly encourage all stockholders to
vote for
DENNER, MULLIGAN, ENDE and BEBCHUK on the GOLD proxy card.
If you have any questions or require any assistance in executing
your proxy,
please call our proxy solicitor, D.F. King & Co., Inc., at
(800) 697-6975.
ON JULY 19, 2011, THE PARTICIPANTS (AS DEFINED BELOW) FILED A
DEFINITIVE PROXY
STATEMENT WITH THE SECURITIES AND EXCHANGE COMMISSION. SECURITY
HOLDERS ARE
ADVISED TO READ THE DEFINITIVE PROXY STATEMENT AND OTHER
DOCUMENTS RELATED TO
THE SOLICITATION OF PROXIES BY CARL C. ICAHN, DR. ALEXANDER J.
DENNER, DR.
RICHARD MULLIGAN, PROFESSOR LUCIAN A. BEBCHUK, DR. ERIC J. ENDE,
MAYU SRIS,
ICAHN PARTNERS LP, ICAHN PARTNERS MASTER FUND LP, ICAHN PARTNERS
MASTER FUND II
L.P., ICAHN PARTNERS MASTER FUND III L.P., HIGH RIVER LIMITED
PARTNERHIP, HOPPER
INVESTMENTS LLC, BARBERRY CORP., ICAHN ENTERPRISES G.P. INC.,
ICAHN ENTERPRISES
HOLDINGS L.P., IPH GP LLC, ICAHN CAPITAL L.P., ICAHN ONSHORE LP,
ICAHN OFFSHORE
LP, AND BECKTON CORP. (COLLECTIVELY, THE "PARTICIPANTS") FROM
THE STOCKHOLDERS
OF FOREST LABORATORIES, INC. FOR USE AT ITS 2011 ANNUAL MEETING
OF STOCKHOLDERS,
BECAUSE THEY CONTAIN IMPORTANT INFORMATION, INCLUDING
INFORMATION RELATING TO
THE PARTICIPANTS. THE DEFINITIVE PROXY STATEMENT AND A FORM OF
PROXY IS
AVAILABLE TO STOCKHOLDERS OF FOREST LABORATORIES, INC. FROM THE
PARTICIPANTS AT
NO CHARGE AND IS ALSO AVAILABLE AT NO CHARGE AT THE SECURITIES
AND EXCHANGE
COMMISSION'S WEBSITE AT HTTP://WWW.SEC.GOV OR BY CONTACTING D.F.
KING & CO.,
INC. BY TELEPHONE AT THE FOLLOWING NUMBERS: STOCKHOLDERS CALL
TOLL FREE: (800)
6976975 AND BANKS AND BROKERAGE FIRMS CALL: (212) 2695550.
Consent of the author and publication has not been sought or
obtained to use the
material cited herein as proxy soliciting material.
Contact: Susan Gordon (212) 702-4309