Exhibit 10.2
 
EXECUTION VERSION
 

 
    VOTING AGREEMENT, dated as of June 20, 2010 (this “Agreement”), among
Biovail Corporation, a Canadian corporation (“Biovail”), Valeant Pharmaceuticals
International, a Delaware corporation (“Delaware”) and the party listed on
Schedule A hereto (the “Stockholder”).

WHEREAS, Biovail, Valeant, Biovail Americas Corp., a direct, wholly owned
subsidiary of Biovail (“BAC”), and Beach Merger Corp., a direct, wholly owned
subsidiary of BAC (“Merger Sub”), propose to enter into an Agreement and Plan of
Merger dated as of the date hereof (as the same may be amended or supplemented,
the “Merger Agreement”; capitalized terms used but not defined herein shall have
the meanings set forth in the Merger Agreement) providing for the merger of
Merger Sub with and into Valeant; and

WHEREAS, the Stockholder owns the number of shares of Valeant Common Stock set
forth opposite its name on Schedule A hereto (such shares of Valeant Common
Stock, together with any other shares of capital stock of Valeant acquired by
the Stockholder after the date hereof and during the term of this Agreement,
being collectively referred to herein as the “Subject Shares”); and

WHEREAS, as a condition to its willingness to enter into the Merger Agreement,
Biovail and Valeant have requested that the Stockholder enter into this
Agreement.

NOW, THEREFORE, the parties hereto agree as follows:

SECTION 1.  Representations and Warranties of the Stockholder.  The Stockholder
hereby represents and warrants to Biovail and Valeant as of the date hereof in
respect of itself as follows:

(a)  Authority; Execution and Delivery; Enforceability.  The Stockholder has all
requisite power and authority to execute this Agreement and to consummate the
transactions contemplated hereby.  The execution and delivery by the Stockholder
of this Agreement and consummation of the transactions contemplated hereby have
been duly authorized by all necessary action on the part of the
Stockholder.  The Stockholder has duly executed and delivered this Agreement,
and this Agreement, assuming this Agreement constitutes a legal, valid and
binding obligation of the other parties hereto, constitutes the legal, valid and
binding obligation of the Stockholder, enforceable against the Stockholder in
accordance with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, moratorium, reorganization or similar laws affecting the rights of
creditors generally and the availability of equitable remedies (regardless of
whether such enforceability is considered in a proceeding in equity or at
law).  The execution and delivery by the Stockholder of this Agreement do
 
 
 
 
 
 

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not, and the consummation of the transactions contemplated hereby and compliance
with the terms hereof will not, conflict with, or result in any violation of, or
default (with or without notice or lapse of time, or both) under, or give rise
to a right of termination, cancelation or acceleration of any obligation or to
loss of a material benefit under, or to increased, additional, accelerated or
guaranteed rights or entitlements of any person under, or result in the creation
of any Lien upon any of the properties or assets of the Stockholder under, any
provision of any Contract to which the Stockholder is a party or by which any
properties or assets of the Stockholder are bound or, subject to the filings and
other matters referred to in the next sentence, any provision of any Judgment or
Law applicable to the Stockholder or the properties or assets of the
Stockholder.  No Consent of, or registration, declaration or filing with, any
Governmental Entity is required to be obtained or made by or with respect to the
Stockholder in connection with the execution, delivery and performance of this
Agreement or the consummation of the transactions contemplated hereby, other
than (i) compliance with and filings under the HSR Act and Part IX of the
Competition Act, if applicable to the Stockholder’s receipt in the Merger of
Biovail Common Stock, and (ii) such reports under Sections 13(d) and 16 of the
Exchange Act or under Canadian Securities Laws as may be required in connection
with this Agreement and the transactions contemplated hereby.

(b)  The Subject Shares.  The Stockholder is the record and beneficial owner of,
and has good and marketable title to, the Subject Shares set forth opposite its
name on Schedule A attached hereto, free and clear of any Liens. The Stockholder
does not own, of record or beneficially, any shares of capital stock of Valeant
other than the Subject Shares set forth opposite its name on Schedule A attached
hereto.  The Stockholder has the sole right to vote such Subject Shares, and
none of such Subject Shares is subject to any voting trust or other agreement,
arrangement or restriction with respect to the voting of such Subject Shares,
except as contemplated by this Agreement.

SECTION 2.  Representations and Warranties of Biovail.  Biovail hereby
represents and warrants to the Stockholder and Valeant as follows:  Biovail has
all requisite corporate power and authority to execute this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery by
Biovail of this Agreement and consummation of the transactions contemplated
hereby have been duly authorized by all necessary action on the part of
Biovail.  Biovail has duly executed and delivered this Agreement, and this
Agreement, assuming this Agreement constitutes a legal, valid and binding
obligation of the other parties hereto, constitutes the legal, valid and binding
obligation of Biovail, enforceable against Biovail in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, moratorium,
reorganization or similar laws affecting the rights of creditors generally and
the availability of equitable remedies (regardless of whether such
enforceability is considered in a proceeding in equity or at law).  The
execution and delivery by Biovail of this Agreement do not, and the consummation
of the transactions contemplated hereby and compliance with the terms hereof
will not, conflict with, or result in any
 
 
 
 
 
 

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violation of, or default (with or without notice or lapse of time, or both)
under, or give rise to a right of termination, cancelation or acceleration of
any obligation or to loss of a material benefit under, or to increased,
additional, accelerated or guaranteed rights or entitlements of any person
under, or result in the creation of any Lien upon any of the properties or
assets of Biovail under, any provision of any Contract to which Biovail is a
party or by which any properties or assets of Biovail are bound or, subject to
the filings and other matters referred to in the next sentence, any provision of
any Judgment or Law applicable to Biovail or the properties or assets of
Biovail.  No Consent of, or registration, declaration or filing with, any
Governmental Entity is required to be obtained or made by or with respect to
Biovail in connection with the execution, delivery and performance of this
Agreement or the consummation of the transactions contemplated hereby, other
than such reports under the Securities Act, the Exchange Act or under Canadian
Securities Laws as may be required in connection with this Agreement and the
transactions contemplated hereby.

SECTION 3.  Representations and Warranties of Valeant.  Valeant hereby
represents and warrants to Biovail and the Stockholder as follows:  Valeant has
all requisite corporate power and authority to execute this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery by
Valeant of this Agreement and consummation of the transactions contemplated
hereby have been duly authorized by all necessary action on the part of
Valeant.  Valeant has duly executed and delivered this Agreement, and this
Agreement, assuming this Agreement constitutes a legal, valid and binding
obligation of the other parties hereto, constitutes the legal, valid and binding
obligation of Valeant, enforceable against Valeant in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, moratorium,
reorganization or similar laws affecting the rights of creditors generally and
the availability of equitable remedies (regardless of whether such
enforceability is considered in a proceeding in equity or at law).  The
execution and delivery by Valeant of this Agreement do not, and the consummation
of the transactions contemplated hereby and compliance with the terms hereof
will not, conflict with, or result in any violation of, or default (with or
without notice or lapse of time, or both) under, or give rise to a right of
termination, cancelation or acceleration of any obligation or to loss of a
material benefit under, or to increased, additional, accelerated or guaranteed
rights or entitlements of any person under, or result in the creation of any
Lien upon any of the properties or assets of Valeant under, any provision of any
Contract to which Valeant is a party or by which any properties or assets of
Valeant are bound or, subject to the filings and other matters referred to in
the next sentence, any provision of any Judgment or Law applicable to Valeant or
the properties or assets of Valeant.  No Consent of, or registration,
declaration or filing with, any Governmental Entity is required to be obtained
or made by or with respect to Valeant in connection with the execution, delivery
and performance of this Agreement or the consummation of the transactions
contemplated hereby, other than such reports under the Securities Act, the
Exchange Act or under Canadian Securities Laws as may be required in connection
with this Agreement and the transactions contemplated hereby.
 
 
 
 
 
 

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SECTION 4.  Covenants of the Stockholder.  The Stockholder covenants and agrees
as follows:

(a) At the Valeant Stockholder Meeting or any other meeting of the stockholders
of Valeant called to seek the Valeant Stockholders Approval or in any other
circumstances upon which a vote, consent or other approval (including by written
consent) with respect to the Merger Agreement or the Merger is sought, the
Stockholder shall vote (or cause to be voted) the Subject Shares of the
Stockholder in favor of granting the Valeant Stockholder Approval.

(b)  At any meeting of stockholders of Valeant or at any adjournment thereof or
in any other circumstances upon which the Stockholder’s vote, consent or other
approval is sought, the Stockholder shall vote (or cause to be voted) the
Subject Shares of the Stockholder against (i) any merger agreement or merger
(other than the Merger Agreement and the Merger), consolidation, combination,
sale of substantial assets, reorganization, recapitalization, dissolution,
liquidation or winding up of or by Valeant, (ii) any Valeant Takeover Proposal
and (iii) any amendment of the Valeant Charter or the Valeant By-laws or other
proposal or transaction involving Valeant or any of its Subsidiaries, which
amendment or other proposal or transaction would in any manner impede,
frustrate, prevent or nullify any provision of the Merger Agreement or the
Merger or change in any manner the voting rights of any class of Valeant Capital
Stock.  The Stockholder shall not commit or agree to take any action
inconsistent with the foregoing.

(c)  Other than this Agreement, the Stockholder shall not (i) sell, transfer,
pledge, assign or otherwise dispose of (including by gift) (collectively,
“Transfer”), or enter into any Contract, option, derivative, hedging or other
agreement or arrangement (including any profit- or loss-sharing arrangement)
with respect to the Transfer of, any Subject Shares to any person other than
pursuant to the Merger, or (ii) enter into any voting arrangement, whether by
proxy, voting agreement or otherwise, with respect to any Subject Shares and
shall not commit or agree to take any of the foregoing actions.

(d)  Subject to Section 8 below, the Stockholder shall not, nor shall it
authorize or permit any Representative of the Stockholder to (i) directly or
indirectly solicit, initiate, knowingly encourage, induce or facilitate any
Valeant Takeover Proposal or any inquiry or proposal that may reasonably be
expected to lead to a Valeant Takeover Proposal or (ii) directly or indirectly
participate in any discussions or negotiations with any Person regarding, or
furnish to any Person any information with respect to, or cooperate in any way
with any Person (whether or not a Person making a Valeant Takeover Proposal)
with respect to any Valeant Takeover Proposal or any inquiry or proposal that
may reasonably be expected to lead to a Valeant Takeover Proposal.
 
 
 
 
 
 

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(e)  The Stockholder shall use all reasonable efforts to take, or cause to be
taken, all actions, and to do, or cause to be done, and to assist and cooperate
with the other parties in doing, all things necessary, proper or advisable to
consummate and make effective, in the most expeditious manner practicable, the
Merger.

(f)  The Stockholder hereby consents to and approves the actions taken by the
Valeant Board in approving the Merger Agreement.  The Stockholder hereby waives,
and agrees not to exercise or assent to, any appraisal rights under Section 262
in connection with the Merger.
 
SECTION 5.  Termination.  This Agreement shall terminate upon the earliest of
(i) the Effective Time, (ii) the termination of the Merger Agreement in
accordance with its terms, (iii) the occurrence of a Valeant Adverse
Recommendation Change, or (iv) the End Date, in each case other than with
respect to the liability of any party for breach hereof prior to such
termination; provided that, notwithstanding anything herein to the contrary, the
obligations of the Stockholder pursuant to Section 4(c)(i) of this Agreement
shall terminate on December 30, 2010 if this Agreement does not terminate on an
earlier date pursuant to the terms of this Section 5.

SECTION 6.  Additional Matters.  The Stockholder shall, from time to time,
execute and deliver, or cause to be executed and delivered, such additional or
further consents, documents and other instruments as Biovail or Valeant may
reasonably request for the purpose of effectively carrying out the transactions
contemplated by this Agreement.
SECTION 7.  Publication.  The Stockholder hereby permits Biovail and Valeant to
publish and disclose in any proxy statement or prospectus (including any
document or schedule filed with the SEC), or any other regulatory filings in
connection with the Merger Agreement, the Stockholder’s identity and ownership
of shares of Valeant Common Stock, the other information set forth on Schedule A
attached hereto, and the nature of its commitments, arrangements and
understandings pursuant to this Agreement.  Each of Biovail and Valeant hereby
permits the Stockholder to publish and disclose in any regulatory filing or
filings which it is required under Law to make as a result of this Agreement the
identity of Valeant and Biovail and the nature of the commitments, arrangements
and understandings of Valeant or Biovail pursuant to this Agreement.
SECTION 8.  Fiduciary Responsibilities.  Notwithstanding any provision of this
Agreement to the contrary, nothing in this Agreement shall limit or restrict the
rights and obligations of G. Mason Morfit, Brandon Boze or any other designee of
the Stockholder serving on the Board of Directors of Valeant from taking any
action in their capacity as directors of Valeant (it being understood that this
Agreement shall apply to the Stockholder solely in its capacity as a stockholder
of Valeant) or voting in their sole discretion on any matter, whether in
connection with the Merger Agreement or otherwise, and such actions shall not be
deemed to constitute a breach of any provision of this Agreement.
 
 
 
 
 
 

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SECTION 9.  General Provisions.

(a)  Amendments.  This Agreement may not be amended except by an instrument in
writing signed by each of the parties hereto.

(b)  Notice.  All notices and other communications hereunder shall be in writing
and shall be deemed given if delivered personally or sent by overnight courier
(providing proof of delivery) to Biovail or Valeant in accordance with
Section 9.02 of the Merger Agreement and to the Stockholder at its address set
forth on Schedule A hereto (or at such other address for a party as shall be
specified by like notice).

(c)  Interpretation.  When a reference is made in this Agreement to Sections,
such reference shall be to a Section to this Agreement unless otherwise
indicated.  The headings contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement.  Wherever the words “include”, “includes” or “including” are used in
this Agreement, they shall be deemed to be followed by the words “without
limitation”.

(d)  Severability.  If any term or other provision of this Agreement is invalid,
illegal or incapable of being enforced by any rule or law, or public policy, all
other conditions and provisions of this Agreement shall nevertheless remain in
full force and effect so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner materially
adverse to any party.  Upon such determination that any term or other provision
is invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the end
that transactions contemplated hereby are fulfilled to the extent possible.

(e)  Counterparts.  This Agreement may be executed in one or more counterparts,
all of which shall be considered one and the same agreement, and shall become
effective when one or more counterparts have been signed by each of the parties
and delivered to the other parties.

(f)  Entire Agreement; No Third-Party Beneficiaries.  This Agreement
(i) constitutes the entire agreement and supersedes all prior agreements and
understandings, both written and oral, among the parties with respect to the
subject matter hereof and (ii) is not intended to confer upon any person other
than the parties hereto any rights or remedies hereunder.

(g)  Governing Law.  This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware regardless of the laws that
might otherwise govern under applicable principles of conflicts of law thereof.
 
 
 
 
 
 
 

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(h)  Assignment.  Neither this Agreement nor any of the rights, interests or
obligations under this Agreement shall be assigned, in whole or in part, by
operation of law or otherwise by any of the parties without the prior written
consent of the other parties.  Any purported assignment without such consent
shall be void.  Subject to the preceding sentences, this Agreement will be
binding upon, inure to the benefit of, and be enforceable by, the parties and
their respective successors and assigns.

(i)  Enforcement.  The parties agree that irreparable damage would occur in the
event that any of the provisions of this Agreement were not performed in
accordance with their specific terms or were otherwise breached.  It is
accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any Federal court located in the
State of Delaware or in any Delaware state court, this being in addition to any
other remedy to which they are entitled at law or in equity.  In addition, each
of the parties hereto (i) consents to submit itself to the personal jurisdiction
of any Delaware state court or any Federal court located in the State of
Delaware in the event any dispute arises out of this Agreement or the Merger,
(ii) agrees that it will not attempt to deny or defeat such personal
jurisdiction by motion or other request for leave from any such court,
(iii) agrees that it will not bring any action relating to this Agreement or the
Merger in any court other than a Delaware state court or any Federal court
sitting in the State of Delaware and (iv) waives any right to trial by jury with
respect to any claim or proceeding related to or arising out of this Agreement
or any transaction contemplated hereby.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

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IN WITNESS WHEREOF, each party has duly executed this Agreement, all as of the
date first written above.
 
 

 
BIOVAIL CORPORATION,
         
 
By:
/s/  WILLIAM M. WELLS       Name:  WILLIAM M. WELLS       Title:     Chief
Executive Officer          

 
 

 
VALEANT PHARMACEUTICALS INTERNATIONAL,
         
 
By:
/s/  J. MICHAEL PEARSON       Name:  J. MICHAEL PEARSON       Title:    Chairman
and Chief Executive Officer          

 
 

 
VALUEACT CAPITAL MASTER FUND, L.P.,by its general partner, VA Partners I, LLC ,
         
 
By:
/s/  JEFFREY W. UBBEN       Name:  JEFFREY W. UBBEN       Title:    Chief
Executive Officer          

 
 
 
 
 
 
 
 

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SCHEDULE A

 
Name and Address
  of Stockholder
 
ValueAct Capital Master Fund, L.P.
435 Pacific Ave., 4th Floor
San Francisco, CA 94133
TEL: (415) 362-3700
FAX: (415) 362-5727
Attn: Allison Bennington
abennington@valueact.com
 
Number of Shares of
Valeant
 Common Stock Owned
 
15,138,358 shares*
 
     

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

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* G. Mason Morfit also owns 24,687 Virginia Restricted Stock Units.