SCHEDULE 13D/A: Icahn Group Amends Governance Agreement with Bausch Health, Modifying Board Rights

Carl Icahn's investment entities have entered into a supplemental agreement with Bausch Health Companies Inc., adjusting terms related to board representation and voting rights for their designees.

Summary

• The Icahn Group, including Carl C. Icahn, holds a significant stake in Bausch Health Companies Inc., with an aggregate beneficial ownership of 34,721,118 shares, representing 9.4% of the common stock.
• On May 20, 2025, the Icahn Group entered into a Supplemental Letter Agreement with Bausch Health Companies Inc.
• Under this agreement, if the Icahn Group undertakes a 'Specified Action,' their designees on both the Bausch Health Board (BHC Board) and the Bausch + Lomb Corporation Board (B+L Board) must immediately tender their resignations.
• The Icahn Group also irrevocably waives their rights under the Amended and Restated Director Appointment and Nomination Agreement (B+L DANA) concerning the designation of Replacement Designees.
• Conversely, as long as the Icahn Group does not engage in a 'Specified Action,' Bausch Health Companies Inc. commits to voting all its Bausch + Lomb Corporation voting securities in favor of any Icahn Group Designee nominated for election to the B+L Board.
• Icahn Group Designees will also have the right to be appointed to any newly-created committees of the BHC Board, provided there are no actual conflicts of interest.

Sentiment

Score: 6

Explanation: The agreement formalizes terms between a major shareholder and the company, which can be seen as a positive for stability, but the 'Specified Action' clause introduces a potential constraint on the activist investor's future actions, making it a neutral to slightly positive development depending on interpretation.

Positives

• The agreement clarifies the terms of engagement between a significant activist investor (Icahn Group) and Bausch Health, potentially reducing future governance disputes if 'Specified Actions' are clearly defined and avoided.
• Bausch Health's commitment to vote for Icahn Group designees on the B+L Board, absent 'Specified Action,' ensures continued representation for the Icahn Group on a key subsidiary's board.
• Icahn Group designees gaining the right to be appointed to newly-created BHC Board committees, absent conflicts, could enhance their influence on strategic decisions.

Negatives

• The 'Specified Action' clause introduces a condition under which Icahn Group designees must resign, potentially limiting the Icahn Group's activist flexibility or leverage if they wish to pursue certain actions.
• The waiver of rights to designate Replacement Designees under the B+L DANA could weaken the Icahn Group's long-term influence on the B+L Board if their current designees resign.

Risks

• The definition and interpretation of 'Specified Action' are crucial; ambiguity could lead to future disputes between the Icahn Group and Bausch Health.
• Potential for loss of Icahn Group board representation if a 'Specified Action' is triggered, which could impact strategic direction or oversight.

Future Outlook

The document outlines a revised governance agreement between Bausch Health and the Icahn Group, setting conditions for continued board representation and voting support, which will shape future interactions regarding strategic direction and oversight.

Industry Context

This filing reflects ongoing dynamics between publicly traded companies and significant activist shareholders, where governance agreements are often negotiated to define the scope of influence and cooperation. Such agreements are common in industries undergoing strategic shifts or facing pressure from large investors.

Corporate Governance

Stakeholder Impact

• Shareholders: The agreement clarifies the relationship with a significant activist shareholder, potentially reducing uncertainty regarding board composition and strategic influence.
• Board Members: Icahn Group designees face specific conditions for their continued tenure.

Next Steps

• Continued adherence to the terms of the Supplemental Letter Agreement by both Bausch Health and the Icahn Group.
• Potential future nominations of Icahn Group Designees to the B+L Board and their appointment to BHC Board committees.

Key Dates

Recommendation

Keywords

Bausch Health Companies Inc., Icahn Group, Carl Icahn, Schedule 13D, SEC filing, corporate governance, board representation, shareholder agreement, Bausch + Lomb Corporation, activist investor