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Shareholders Challenge Hercules Board to Investigate Possible
Anti-Trust Violation and Conflicts of Interests of Director John C. Hunter
WASHINGTON, Oct. 7 /PRNewswire/ -- The AFL-CIO Office of Investment today
asked Hercules, Inc.'s (NYSE:HPC) board of directors to initiate an
investigation into a possible anti-trust violation by board member John C.
Hunter, III. An anti-trust law, the Clayton Act, bars the same director from
sitting on the boards of competing companies. Mr. Hunter also serves on the
board of Hercules competitor Penford Corp. (NASDAQ:PENX). The Office of
Investment also asked Hercules' board to investigate possible conflicts of
interests regarding these two board seats. Two other shareholder
representatives, the Amalgamated Bank and the Marco Consulting Group, have
raised similar concerns with Hercules' board.
"Letting this issue linger severely compromises Mr. Hunter's ability, and
Hercules' board as a whole, to act as an effective advocate for investors,"
said Bill Patterson, Director of the AFL-CIO Office of Investment. "Hercules'
board should act immediately to reassure investors regarding its corporate
governance practices."
The shareholders asked for this inquiry today, because Hercules' board has not
publicly responded to a complaint filed last month with the Federal Trade
Commission (FTC) by the Food and Allied Service Trades Department, AFL-CIO. The
FTC complaint alleges that Hercules and Penford compete to sell ingredients to
the paper-making industry. The shareholders are concerned that Mr. Hunter's
board membership at both companies may violate Section 8 of the Act. Penford
has publicly stated that it will cooperate with any investigation by the FTC.
Founded in 1923, the Amalgamated Bank invests workers' retirement savings
through its LongView Funds. With $9 billion in assets under management,
LongView works to enhance shareholder value through corporate governance
reforms at portfolio companies. Amalgamated Bank currently holds 47,188 shares
in Hercules.
The Marco Consulting Group is a registered investment adviser to more than 400
institutional investors who, in the aggregate, own 900,713 shares of Hercules,
Inc. stock.
The AFL-CIO represents 13 million working men and women who participate in the
capital markets as investors through defined benefit and defined contribution
plans as well as through mutual funds and individual accounts. AFL-CIO
affiliate union-sponsored benefit funds have over $400 billion in assets.
Union-sponsored pension funds hold an estimated 1.73 million shares in
Hercules.
DATASOURCE: AFL-CIO
CONTACT: Cornish Hitchcock of Amalgamated Bank, +1-202-364-1050; or Greg
Kinczewski of Marco Consulting Group, +1-312-612-8452; or Dieter Waizenegger
of AFL-CIO Office of Investment, +1-202-637-3900
Web site: http://www.aflcio.org/