ARIAD Pharmaceuticals, Inc
Item 4. Purpose of Transaction.
Item 4 of the Initial Schedule 13D is hereby amended by adding the following:
The Reporting Persons have been in negotiations with certain members of the Issuer’s board of directors and the board’s advisors in an attempt to avoid a potential proxy contest by the Reporting Persons at the 2015 annual meeting. As part of those discussions, the Reporting Persons have indicated their belief that based on their experiences and interactions with the Issuer, it is in the best interests of the Issuer and its shareholders that the board undertake measures to effect and facilitate the imminent retirement of Harvey Berger as CEO of the Issuer and that any settlement of a potential proxy contest must include the CEO’s retirement. Unfortunately, the Reporting Persons have not been able to reach a settlement.
Given the impasse with the board on a settlement and the conduct of certain members of the board (including as described in the following paragraph), the Reporting Persons believe that the board as currently constructed (particularly in its leadership roles) is not up to the task of providing the stewardship necessary to optimally navigate the Issuer. Therefore, on February 19, 2015, the Reporting Persons notified the Issuer that the Reporting Persons intend to appear at the Issuer's 2015 annual meeting of stockholders to nominate and seek to elect Richard C. Mulligan, Ph.D. and Anna Protopapas to the Issuer’s eight member staggered board of directors. The Reporting Persons intend to seek to unseat Harvey Berger, the Issuer’s Chairman and CEO, and Wayne Wilson, the lead independent director, with their two nominees at the 2015 annual meeting and reserve the right to add an additional nominee prior to the February 25, 2015 deadline to nominate directors under the Issuer’s bylaws. The respective biographies of their two nominees are set forth below.
In addition, the Reporting Persons are extremely concerned with the conduct of certain members of the Issuer’s board, particularly with respect to compensation, governance and financial matters. For example, the Reporting Persons are especially disturbed by the decision to renew Harvey Berger’s employment contract in October 2013 and, given the egregious terms of that employment agreement, urge the Issuer to immediately disclose to shareholders any discussions of the board and the compensation committee regarding the decision to renew this agreement. In this regard, the Reporting Persons may seek to compel such disclosure and may ultimately initiate court proceedings to seek to remove one or more directors for cause based on potential breaches of their fiduciary duties.