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Amylin to approve, not recommend, dissident nominees to settle suit
By Lisa Kerner
Charlotte, N.C., April 15 - Amylin Pharmaceuticals, Inc. and the San Antonio Fire & Police Pension Fund agreed to partial settlement terms on Monday in connection with the pension fund's lawsuit pending in the Delaware Court of Chancery.
The agreement calls for the pension fund to withdraw all allegations that Amylin's board of directors "has not acted in good faith or has acted to entrench itself or to interfere with stockholder voting rights," according to a form 8-K filed with the Securities and Exchange Commission.
In addition, the pension fund will withdraw its claims that the board is breaching its ongoing duties to Amylin's stockholders, the filing said.
At issue was Amylin's belief that its board has the contractual right to approve director nominees other than those it is recommending be elected at the 2009 stockholder meeting so that their election does not trigger the "fundamental change" provision contained in the 2007 indenture for the company's convertible notes due 2014. The fundamental change provision would give the noteholders the right to require Amylin to repurchase the notes at par, according to the filing.
As a result, Amylin's board will approve the Icahn Capital LP and Eastbourne Capital Management LLC nominees for purposes of the indenture but continues to recommend against the election of the nominees, the filing said.
Icahn and Eastbourne are each putting forth a slate of five nominees for election to the San Diego biopharmaceutical company's board.
"The partial settlement validates the company's position that it did not initiate the inclusion of these provisions in its debt agreements and should put to rest any assertions to the contrary," the filing said.
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