Eastbourne Capital Management Comments on Delaware Lawsuit to Enjoin Amylin Pharmaceuticals “Poison Puts”
March 30 2009 - 8:00AM
Business Wire
Eastbourne Capital Management, L.L.C. (�Eastbourne�) commented
on the class action lawsuit filed late last week in Delaware�s
Court of Chancery against Amylin Pharmaceuticals, Inc. (�Amylin�)
(NASDAQ: AMLN) and its entire Board of Directors by
Amylin shareholder, San Antonio Fire & Police Pension Fund,
seeking to invalidate �poison put� provisions in Amylin�s credit
agreements and to require the Amylin Board to remove the obstacle
posed by those provisions to the election of directors nominated
separately by Eastbourne and by funds affiliated with Carl Icahn.
Eastbourne has notified Amylin of its intention to seek the
election of five nominees to Amylin�s Board of Directors.
Eastbourne currently owns approximately 12.5% of Amylin�s
outstanding shares.
Rick Barry, Eastbourne Founder and Portfolio Manager said, �We
applaud San Antonio Fire & Police Pension Fund and are
encouraged that another thoughtful institutional shareholder has
come forward and taken the initiative to seek to enforce the legal
rights of all Amylin shareholders. We believe the lawsuit, which
has enormous merit and raises important issues beyond this contest,
serves the best interests of all shareholders.
�As should be clear from our last letter to Amylin�s Board, we
believe that, since this year there are two separate shareholder
slates, the Company�s �poison puts,� unless they are neutralized,
threaten to tilt the electoral playing field in favor of the
incumbent board by effectively precluding not merely the election
of a new majority on the Board, which Eastbourne is not seeking,
but, as a practical matter, the election of any
shareholder-nominated directors at all.
�Intentionally or not, these type of provisions, which are
agreed to by management without shareholder approval, embedded in
voluminous credit agreements and often not otherwise disclosed,
deprive shareholders of the substantive right to freely nominate
directors; essentially subjecting that right to board approval or
delegating it altogether to creditors. We think that any board�s
fiduciary duties, particularly its duty of loyalty, would lead it
to use all of its powers to lift this constraint on a basic
shareholder right, and not to condone its operation to stifle an
open election and protect the continued reign of incumbent
directors. We cannot imagine what rationale directors could advance
to support such a failure to act other than to preserve themselves
in office.
�We had hoped that the Amylin Board would come to a similar
conclusion and respond positively to our request that they take
action to dispel the cloud cast by the Company�s �poison puts� and
that resorting to the courts would not be necessary. We believe
that the Board�s failure to do so will be viewed by our fellow
shareholders as stark evidence of the current Amylin Board�s
approach to corporate governance. We encourage other shareholders
to continue to speak out and support change on the Board.�
About Eastbourne Capital Management, L.L.C.
Eastbourne Capital Management is a West Coast-based registered
investment advisor that employs an investment philosophy based on
intensive research, a long-term outlook and a belief in working
alongside portfolio companies to enhance shareholder value.
IMPORTANT ADDITIONAL
INFORMATION
Security holders are advised to read the proxy statement, white
proxy card and other documents related to the solicitation of
proxies by Eastbourne Capital Management, L.L.C., Black Bear Fund
I, L.P., Black Bear Fund II, L.L.C., Black Bear Offshore Master
Fund, L.P., Richard J. Barry, M. Kathleen Behrens, Marina S.
Bozilenko, Charles M. Fleischman, William A. Nuerge and Jay
Sherwood from the shareholders of Amylin Pharmaceuticals for use at
the 2009 Annual Meeting of Shareholders of Amylin Pharmaceuticals
when they are available because they will contain important
information. Such materials will, along with other relevant
documents, be available at no charge at the Securities and Exchange
Commission�s website at http://www.sec.gov or by contacting
Mackenzie Partners, Inc. by telephone collect at (212) 929-5500,
toll-free at 1-800-322-2885 or by e-mail at
amylinproxy@mackenziepartners.com. Information relating to the
participants in such proxy solicitation is contained in Exhibit 1
to the Schedule 14A filed on February 2, 2009 and available free of
charge at the Securities and Exchange Commission�s website at
http://www.sec.gov.
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