Fired Exec Loses Seat on Dow Board
By KATHY BARKS HOFFMAN
AP 5/10/07
MIDLAND, Mich. (AP) - Shareholders on Thursday
severed ties with J. Pedro Reinhard, a senior
adviser who was fired last month by Dow Chemical Co.
after company officials said he and another Dow
executive had been holding secret buyout talks with
outside interests.
Reinhard and Romeo Kreinberg, a divisional executive vice president, were fired by Dow Chemical on April 12. Both men denied any wrongdoing. Reinhard and Dow have filed lawsuits against each other.
President and Chief Executive Andrew N. Liveris announced during the company's annual meeting on Thursday that the board told shareholders in an April 19 mailing that Reinhard's name was being withdrawn from the list of board candidates.
The other 11 board positions were filled at the meeting. The shareholders also approved a proposal allowing them to decide issues such as removing board members with a simple majority instead of a supermajority of 80 percent of shares voted.
Reinhard spent 37 years at the Midland-based company, including 10 as Dow's chief financial officer. He remained on the company's board until Thursday's vote because only shareholders, not management, can remove a director from the board.
Reinhard's attorney, Gary Naftalis, said in a statement that Thursday's action was no surprise.
"Mr. Reinhard declined to resign from the board, because he has done nothing wrong," Naftalis said. "The company did not include him on its slate, and under the circumstances, Mr. Reinhard has absolutely no interest in continued service on that board.
"Mr. Reinhard remains very proud of his 37 years at Dow and we will vigorously prosecute our complaint, which alleges a pattern of libelous statements by Liveris and Dow that has damaged the outstanding reputation and good name of Mr. Reinhard," Naftalis added.
Kreinberg and Reinhard were fired after a British tabloid reported that a group of Middle Eastern investors and U.S. buyout firms had secured financial backing for a $50 billion bid for Dow. The company first said it wasn't in negotiations, then said the two company officials had engaged in secret talks without the company's knowledge.
Liveris addressed the matter briefly during a question-and-answer period Thursday.
"We never received an approach. ... Never. Not once," he told shareholders. Without mentioning Reinhard or Kreinberg by name, he added: "The suspicious activity was found and taken care of."
Just over 1,000 people attended the company's 110th annual meeting at the Dow Center for the Arts.
During his speech summing up the company's 2006 accomplishments, Liveris said Dow made substantial progress toward having consistent earnings rather than ones that followed the ups and downs in the chemical industry. He said it also was doing well with its equity earnings, reduced its debt and had 600 new projects in the pipeline. Thirty percent of last year's revenue came from new products, he said.
NASCAR driver Dale Jarrett was on hand to praise the new energy-absorbing foam being built into the doors of NASCAR's new Car of Tomorrow. Jarrett said the foam made a difference when his car was struck in the side during a race.
"I think about safety when I'm at work driving around the race track at 180 miles per hour," said Jarrett, who signed autographs and posed with his race car after the annual meeting. "I'm a satisfied customer."
Not everyone at the meeting was as pleased, however. Several people, mostly from the Tri-Cities area of Midland, Bay City and Saginaw, questioned why the removal of dioxin from the Tittabawassee River and the Midland area was moving so slowly.
Dow, the world's second-largest chemical company, has acknowledged it polluted the Tittabawassee River flood plain with dioxins for many years. Unlike the Tittabawassee contamination, which resulted from river disposal, Midland's contamination is believed to be from airborne emissions. The river dioxin is more widespread.
Liveris said Dow is working closely with state environmental officials to decide how best to deal with the dioxin. But he denied people living in Midland were in any danger, and said it's important to scientifically determine where the contamination is and how best to remove it.
"From a health point of view, this community's fine," he said. "I live here, our executives live here, our families live here. We care about this community."
Shareholders voted down a proposal that would have required the board of directors to issue a report to shareholders by April 2008 summarizing the pace and effectiveness of the dioxin cleanup.
Directors re-elected to the board for one-year terms were Arnold A. Allemang, Jacqueline K. Barton, James A. Bell, Jeff M. Fettig, Barbara Hackman Franklin, John B. Hess, Geoffery E. Merszei, James M. Ringler, Ruth G. Shaw, Paul G. Stern and Liveris.
Reinhard and Romeo Kreinberg, a divisional executive vice president, were fired by Dow Chemical on April 12. Both men denied any wrongdoing. Reinhard and Dow have filed lawsuits against each other.
President and Chief Executive Andrew N. Liveris announced during the company's annual meeting on Thursday that the board told shareholders in an April 19 mailing that Reinhard's name was being withdrawn from the list of board candidates.
The other 11 board positions were filled at the meeting. The shareholders also approved a proposal allowing them to decide issues such as removing board members with a simple majority instead of a supermajority of 80 percent of shares voted.
Reinhard spent 37 years at the Midland-based company, including 10 as Dow's chief financial officer. He remained on the company's board until Thursday's vote because only shareholders, not management, can remove a director from the board.
Reinhard's attorney, Gary Naftalis, said in a statement that Thursday's action was no surprise.
"Mr. Reinhard declined to resign from the board, because he has done nothing wrong," Naftalis said. "The company did not include him on its slate, and under the circumstances, Mr. Reinhard has absolutely no interest in continued service on that board.
"Mr. Reinhard remains very proud of his 37 years at Dow and we will vigorously prosecute our complaint, which alleges a pattern of libelous statements by Liveris and Dow that has damaged the outstanding reputation and good name of Mr. Reinhard," Naftalis added.
Kreinberg and Reinhard were fired after a British tabloid reported that a group of Middle Eastern investors and U.S. buyout firms had secured financial backing for a $50 billion bid for Dow. The company first said it wasn't in negotiations, then said the two company officials had engaged in secret talks without the company's knowledge.
Liveris addressed the matter briefly during a question-and-answer period Thursday.
"We never received an approach. ... Never. Not once," he told shareholders. Without mentioning Reinhard or Kreinberg by name, he added: "The suspicious activity was found and taken care of."
Just over 1,000 people attended the company's 110th annual meeting at the Dow Center for the Arts.
During his speech summing up the company's 2006 accomplishments, Liveris said Dow made substantial progress toward having consistent earnings rather than ones that followed the ups and downs in the chemical industry. He said it also was doing well with its equity earnings, reduced its debt and had 600 new projects in the pipeline. Thirty percent of last year's revenue came from new products, he said.
NASCAR driver Dale Jarrett was on hand to praise the new energy-absorbing foam being built into the doors of NASCAR's new Car of Tomorrow. Jarrett said the foam made a difference when his car was struck in the side during a race.
"I think about safety when I'm at work driving around the race track at 180 miles per hour," said Jarrett, who signed autographs and posed with his race car after the annual meeting. "I'm a satisfied customer."
Not everyone at the meeting was as pleased, however. Several people, mostly from the Tri-Cities area of Midland, Bay City and Saginaw, questioned why the removal of dioxin from the Tittabawassee River and the Midland area was moving so slowly.
Dow, the world's second-largest chemical company, has acknowledged it polluted the Tittabawassee River flood plain with dioxins for many years. Unlike the Tittabawassee contamination, which resulted from river disposal, Midland's contamination is believed to be from airborne emissions. The river dioxin is more widespread.
Liveris said Dow is working closely with state environmental officials to decide how best to deal with the dioxin. But he denied people living in Midland were in any danger, and said it's important to scientifically determine where the contamination is and how best to remove it.
"From a health point of view, this community's fine," he said. "I live here, our executives live here, our families live here. We care about this community."
Shareholders voted down a proposal that would have required the board of directors to issue a report to shareholders by April 2008 summarizing the pace and effectiveness of the dioxin cleanup.
Directors re-elected to the board for one-year terms were Arnold A. Allemang, Jacqueline K. Barton, James A. Bell, Jeff M. Fettig, Barbara Hackman Franklin, John B. Hess, Geoffery E. Merszei, James M. Ringler, Ruth G. Shaw, Paul G. Stern and Liveris.