AbbVie 2014 Annual Report Download - page 30

13NOV201221352027
Certain provisions in AbbVie’s amended and restated certificate of incorporation and amended and
restated by-laws, and of Delaware law, may prevent or delay an acquisition of AbbVie, which could
decrease the trading price of AbbVie’s common stock.
AbbVie’s amended and restated certificate of incorporation and amended and restated by-laws contain,
and Delaware law contains, provisions that are intended to deter coercive takeover practices and
inadequate takeover bids by making such practices or bids unacceptably expensive to the bidder and to
encourage prospective acquirors to negotiate with AbbVie’s board of directors rather than to attempt a
hostile takeover. These provisions include, among others:
• the inability of AbbVie’s stockholders to call a special meeting;
• the division of AbbVie’s board of directors into three classes of directors, with each class serving a
staggered three-year term;
• a provision that stockholders may only remove directors for cause;
• the ability of AbbVie’s directors, and not stockholders, to fill vacancies on AbbVie’s board of
directors; and
• the requirement that the affirmative vote of stockholders holding at least 80 percent of AbbVie’s
voting stock is required to amend certain provisions in AbbVie’s amended and restated certificate of
incorporation and AbbVie’s amended and restated by-laws relating to the number, term and election
of AbbVie’s directors, the filling of board vacancies, the calling of special meetings of stockholders
and director and officer indemnification provisions.
In addition, Section 203 of the Delaware General Corporation Law provides that, subject to limited
exceptions, persons that acquire, or are affiliated with a person that acquires, more than 15 percent of the
outstanding voting stock of a Delaware corporation shall not engage in any business combination with that
corporation, including by merger, consolidation or acquisitions of additional shares, for a three-year period
following the date on which that person or its affiliates becomes the holder of more than 15 percent of
the corporation’s outstanding voting stock.
AbbVie believes these provisions protect its stockholders from coercive or otherwise unfair takeover
tactics by requiring potential acquirors to negotiate with AbbVie’s board of directors and by providing
AbbVie’s board of directors with more time to assess any acquisition proposal. These provisions are not
intended to make the company immune from takeovers. However, these provisions apply even if the offer
may be considered beneficial by some stockholders and could delay or prevent an acquisition that AbbVie’s
board of directors determines is not in the best interests of AbbVie and AbbVie’s stockholders. These
provisions may also prevent or discourage attempts to remove and replace incumbent directors.
24 2014 Form 10-K