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Highlights from the world of Proxy Papers you can’t afford to miss: Allergan plc, Energen Corporation, Jardine Group companies (Mandarin Oriental International Limited, Hongkong Land Holdings Ltd, and Dairy Farm International Limited), Yamana Gold Inc., PulteGroup, Inc., Apollo Education Group Inc., and Jasmine International Public Company Limited.

Allergan plc

New York Stock Exchange – May 5, 2016
Botox maker Allergan’s 2016 annual meeting arrives immediately in the wake of the collapse of a merger with Pfizer that would have been the largest pharmaceutical deal ever cemented. The U.S. Treasury’s decision to tighten its rules on “tax inversions” that allow companies (such as Pfizer) to lower their effective tax rates appeared directly aimed at the Allergan deal. Allergan, which is also in the process of selling its US$40.5 billion generics business to Israeli pharma giant Teva, is now left searching for other “transformative transactions”, although CEO Brent Saunders has been quick to point out the Company’s “compelling standalone growth profile and strategy”. While shareholders are unlikely to blame the Company’s board for the collapse of the Pfizer merger, plenty of questions remain surrounding its plans to pay special bonuses and tax gross-ups to executives in conjunction with the deal. A shareholder proposal will also ask shareholders to consider whether the chairman should be an independent director, as opposed to the current executive chairman Paul Bisaro, who is the Company’s former president and CEO.

Energen Corporation

New York Stock Exchange – May 3, 2016 
Over recent times, investors have been increasing their attention on issues related to natural gas extraction, and, in particular, those related to methane emissions. In the last two years, the vast majority of shareholder proposals concerning methane emissions asked companies to report on current emissions levels and set attendant reduction goals. However, at Energen Corporation’s 2016 annual meeting shareholders will vote on a first-of-its-kind proposal, submitted by the California State Teachers’ Retirement System, requesting that the firm disclose more information on how it is monitoring and managing the level of methane released from its operations. Given the growing regulatory focus on this issue (including the recent joint announcement by the U.S. and Canada to reduce methane emissions by 40-45% by 2025) and the fact that at last year’s annual meeting nearly 30% of Energen’s shareholders (excluding abstentions) supported a more restrictive proposal requesting that the firm adopt methane emissions reduction goals, shareholders should watch this particular vote closely.

Jardine Group – Mandarin Oriental International Limited, Hongkong Land Holdings Ltd, and Dairy Farm International Limited

Singapore Exchange – May 4, 2016
With board members such as Lord Leach of Fairford, Lord Sassoon and Lord Powell of Bayswater, the boards of the Jardine Group of companies have a certain aura of nobility in conducting business. Yet, as Jardine Group companies including Hongkong Land, Mandarin Oriental and Dairy Farm convene their AGMs, it is quickly apparent that for this storied stalwart of Asia-Pacific business, good corporate governance practices are apparently much less important to the conglomerate. Indeed, not one of these companies has an independent director, nomination committee or remuneration committee. Further, Singapore Exchange listing rules require one-third of a board to be up for election each year, however, each company has exempted their chairman and managing director from standing for election. Combine these matters with a complete lack of disclosure concerning director attendance and one may be mistaken in thinking that these boards take their old world legacy so seriously as to emulate their peers in the House of Lords where accountability and democratic representation of all parties (not just the most influential, controlling shareholders) are problematic. Although audit committees have finally been established for each of the aforementioned companies, the Jardine Group remains reliant on noble platitudes of commitments to “high standards of governance” with boilerplate language describing “well-tried approach[es] to oversight and management that has been developed over many years”. Independent shareholders are likely well aware of the Group’s governance shortcomings, and should expect materially improved corporate governance practices to evolve at a leisurely, regal pace.

Yamana Gold Inc.

Toronto Stock Exchange – May 5, 2016
Shareholders resoundingly rejected Yamana Gold’s compensation program at last year’s annual meeting, with opposition likely driven as much by the company’s poor performance results as by its recent compensation-related actions, including the curious decision to omit the value of a series of one-time cash and equity grants from its summary compensation table disclosure. With little fanfare, these values have been included in this year’s disclosure, and CEO Peter Marrone ultimately waived his entitlement to the one-time equity grants made the prior year. Shareholders will now consider whether these concessions, and the spate of recent structural changes and temporary pay reductions, indicate a company sufficiently responding to relevant concerns.

PulteGroup, Inc.

New York Stock Exchange – May 4, 2016
A spat between Bill Pulte and the current leadership of the home building company he founded in 1950 became public in April when Bill Pulte issued a letter to the board expressing his “extreme disappointment” in the leadership of CEO Richard Dugas and calling for his immediate resignation. Among his complaints were the company’s lackluster stock price performance and its decision to relocate the corporate headquarters from suburban Detroit to Atlanta. Mr. Dugas capitulated by agreeing to step down in 2017, but tensions became more evident when the company’s definitive slate of nominees conspicuously omitted James Grosfeld, a former CEO who was re-added to the board in late 2015 at the behest of Mr. Pulte. Mr. Grosfeld, subsequently resigned with immediate effect on April 12. Shareholders should monitor this conflict as the 2016 annual meeting approaches. In addition to re-electing board members and assessing the executive pay program, shareholders will vote on a proposal to extend the company’s NOL poison pill as well as a shareholder proposal seeking a majority vote standard.

Apollo Education Group Inc.

NASDAQ – April 28, 2016
Struggling University of Phoenix operator Apollo Education Group, the largest but worst-performing company in the beleaguered for-profit education sector, plans to go private later this year. In doing so, it hopes to survive a tidal wave of criticism and competition that has inflicted sharp declines in the company’s financial performance and market value. Since the start of 2012, AEG’s enrolment has fallen by half, revenues have followed suit, and profits are down 80%. Over that period, the company’s stock price plummeted 88% to a 20-year low, at which point Apollo Global Management (no relation), a New York private-equity firm with a knack for catching falling knives, agreed along with two other investment firms to buy AEG for a price of $9.50 a share. At a potential bargain valuation of just 1.4x EBITDA, it’s no wonder AEG’s two largest shareholders, holding a 23% stake between them, came out against the deal. Still, with the deterioration in AEG’s business only accelerating at last check, public investor’s will need to consider whether the all-cash buyout offer might represent the best option at this time following the substantial erosion of shareholder value.

Jasmine International Public Company Limited

Stock Exchange of Thailand – April 29, 2016
For a publicly-traded company that provides telecommunications services, Jasmine International Public Company Limited (“Jasmine”) may have to quickly think of ways to expand business opportunities following its loss of a license to provide 4G broadband wireless services. In March, the license which was won in an auction in December 2015 after outbidding rivals such as Intuch Holdings (SET: INTUCH) was forfeited to Thailand’s National Broadcasting and Telecommunications Commission (“NBTC”) after Jasmine failed to make an initial payment and provide bank guarantees. The Company also forfeited a guarantee of THB 644 million that was posted at the time of the auction, has failed to compensate the NBTC THB 160 million for the cost of the December auction and has been barred from the participating in a new 4G license auction to be held in late May. As such, Jasmine now faces the prospect of being blacklisted and sued by the NBTC for damages, with all operating licenses held by the Company, including across fixed broadband and digital TV being at risk of being revoked. The combined impact of these events may thwart Jasmine’s ability to emerge from a stalled business rehabilitation plan which has run into judicial roadblocks as creditors are seeking upward of THB 1.956 billion in unaccounted liabilities. Jasmine’s future performance along with that of its shareholders’ holdings appears to be significantly dependent on the board and management’s ability to find new opportunities to supplant those forfeited and to survive the mounting potential penalties that may well be imposed by external third parties. Stay tuned.