Case: 1:10-cv-07212 Document #: 1 Filed: 11/08/10 Page 2

Case: 1:10-cv-07212 Document #: 1 Filed: 11/08/10 Page 1 of 36 PageID #:1

IN THE UNITED STATES DISTRICT COURTFOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

DOLORES JOYCE, on behalf of herself andall other similarly situated shareholders ofAlberto-Culver Company,

Plaintiff, C.A No.v.

COMPLAINT FOR BREACH OFLEONARD H. LAVIN, CAROL L. FIDUCIARY DUTY AND VIOLATION OFBERN ICK, V. JAMES MARINO, JAMES G. SECTION 14(a) AND 20(a) OF THEBROCKSMITH, JR, ROBERT H. ROCK, SECURITIES EXCHANGE ACT OF 1934THOMAS A. DATTI LO, JAMES R. EDGAR,SAM J. SUSSER, GEORGE L. FOTIADES,KING W. HARRIS, ALBERTO-CULVERCOMPANY, UNILEVER N.V., UNILEVERPLC, CONOPCO, I NC. and ACE MERGER,INC.,

Defendants.

COMPLAINT

Plaintiff Dolores Joyce (“Plaintiff”), on behalf of herself and all other similarly situated

public shareholders of Alberto-Culver Company (hereafter, “Alberto-Culver” or the

“Company”), (the “Class”), bring this lawsuit against the members of the board of directors of

Alberto-Culver (the “Board”) seeking equitable relief for their violations of Section 20(a) and

14(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 14a-9 promulgated

thereunder, and for breaching their fiduciary duties, and against Unilever N.V., Unilever PL C,

Conopco, Inc. and Ace Merger, Inc. (collectively, “Unilever”) for aiding and abetting the

breaches of fiduciary duties. The allegations of the Complaint are based on the knowledge of

Plaintiff as to herself, and on information and belief, including the investigation of counsel and

review of publicly available information, as to all other matters.


INTRODUCTION

1. This is a shareholder class action brought by Plaintiff on her behalf and/or on

behalf of holders of Alberto-Culver stock to enjoin the proposed acquisition of the publicly

owned shares of Alberto-Culver common stock by Unilever, as detailed herein (the “Proposed

Transaction”).

2. On September 27, 2010, Unilever, an international consumer products company,

and Alberto-Culver, a leading manufacturer of beauty care products, announced an Agreement

and Plan of Merger (the “Merger Agreement”) whereby Unilever would acquire Alberto-Culver

for $37.50 per share in cash (“Offer Price”) in the Proposed Transaction valued at approximately

$3.7 billion. This purchase price represents a meager 19% premium to Alberto-Culver’s closing

stock price on the trading day immediately preceding the deal’s announcement.

3. The Proposed Transaction provides Alberto-Culver shareholders with grossly

inadequate consideration and is the result of a flawed sales process. After recently restructuring

its business to focus on its consumer segment, the Company has reported two consecutive

quarters of impressive sales and earnings per share, and Wall Street analysts have predicted rapid

growth within the personal care products industry, the very focus of the Company’s business.

Consequently, Alberto-Culver’s Board had substantial leverage to negotiate a significant

premium in an all-cash sale of the Company. Nevertheless, the Board breached its fiduciary

duties by electing to negotiate the sale of the Company solely with Unilever, without ever

contacting any other potential buyers.

4. The Board further breached its fiduciary duties by agreeing to certain deal

protection devices designed to make the Proposed Transaction a virtual fait d’accompli and deter

the emergence of any competing bidders. Specifically, the Board agreed to: (i) a termination fee

2


of $125 million; (ii) a strict “no shop” provision that prevents Alberto-Culver from

communicating with or providing Company information to competing bidders; and (iii) a

matching rights provision. Moreover, concurrently with the execution of the Merger Agreement,

certain members of the Board, including defendants Leonard H. Lavin (“Lavin”) and Carol

Lavin Bernick (“Bernick”), who collectively own over 13% of the Company’s stock, entered into

a Stockholder Agreement (the “Voting Agreement”) that irrevocably binds them to vote in favor

of the Proposed Transaction. Collectively, these provisions serve to deter the emergence of any

competing bidders, thereby denying Alberto-Culver shareholders the opportunity to obtain the

true value of their holdings in the Company.

5. The Board also breached federal law and its fiduciary duties making grossly

inadequate disclosures to Company shareholders regarding the Proposed Transaction and thus

inhibiting their ability to evaluate the deal. On October 15, 2010, the Board caused the Company

to file its preliminary proxy statement on Schedule 14A with the Securities and Exchange

Commission (“SEC”) for a special meeting of shareholders to vote on the Proposed Transaction

(the “Proxy”). The Proxy fails to provide the Company’s shareholders with material information

and/or provides them with materially misleading information, thereby rendering the shareholders

unable to cast an informed vote regarding the Proposed Transaction.

6. In pursuing this unlawful plan to sell Alberto-Culver for grossly inadequate

consideration through a flawed sales process, and agreeing to unreasonable and disproportionate

deal protections with grossly inadequate disclosures made to the Company’s shareholders, each

of the defendants violated applicable law by directly breaching their fiduciary duties of loyalty,

due care, independence, good faith and fair dealing, and/or aiding and abetting the other

defendants’ breaches of such fiduciary duties.

3


JURISDICTION AND VENUE

7. This Court has subject matter jurisdiction under 28 U.S.C. § 1331 (federal

question jurisdiction), as this Complaint alleges violations of Section 20(a) and 14(a) of the

Securities Exchange Act, 15 U.S.C. § 78n(a). This Court has jurisdiction over the state law

claims alleged herein pursuant to 28 U.S.C. § 1367.

8. Venue is proper in this District because many of the acts and practices

complained of herein occurred in substantial part in this District. In addition, Albert-Culver

maintains its principal executive offices in Melrose Park, Illinois. Moreover, one or more of the

defendants have received substantial compensation in this District by doing business here and

engaging in numerous activities that had an effect in this District.

PARTIES

9. Plaintiff Dolores Joyce is a shareholder of Albert-Culver, has owned shares of

Alberto-Culver common stock throughout the relevant period, and will continue to hold shares

through the pendency of this action.

10. Defendant Alberto-Culver is a Delaware corporation with its principal executive

offices located at 2525 Armitage Avenue, Melrose Park, Illinois 60160. Alberto-Culver is an

innovative leader in consumer products in key markets around the world. The Company

develops, manufactures, distributes, and markets beauty care products, as well as household and

food products in the United States and approximately 100 other countries. Beauty care products

Alberto-Culver markets in the United States include Alberto VO5, TRESemme, and Consort hair

care products, St. Ives and Noxema skin care products, and FDS feminine deodorant sprays. The

Company also sells food and household products in the United States which include the Mrs.

Dash salt-free seasoning blends, Static-Guard anti-static spray, Molly McButter butter-flavored

4


sprinkles, SugarTwin sugar substitute and Kleen Guard furniture polish brands. Alberto-Culver

is listed on the New York Stock Exchange (“NYSE”) and trades under the symbol “ACV.”

11. Defendant Lavin is the founder and Chairman Emeritus of Alberto-Culver. Lavin

has served as Chairman Emeritus since 2004 and has been a director of the Company since 1955.

Prior to becoming Chairman Emeritus, Lavin served as Chairman of the Company from 1955 to

2004. According to the Company’s December 14, 2009 definitive proxy statement, Lavin owns

7,771,211 shares, or nearly 7.92% of the Company’s outstanding common stock. Lavin is the

father of defendant Bernick.

12. Defendant Bernick has served as Executive Chairman of Alberto-Culver since

2004 and has served a director of the Company since 1984. Bernick has also served as President

of Alberto-Culver USA, Inc., a wholly-owned subsidiary of Alberto-Culver from 1994 to 2004;

as Vice Chairman of Alberto-Culver from 1998 to 2004; as President of Alberto-culver

Consumer Products Worldwide, a division of Alberto-Culver, from 2002 to 2004; and as

Assistant Secretary of the Company from 1990 to 2004. Bernick is the daughter of defendant

Lavin. According to the Company’s December 14, 2009 definitive proxy statement, Bernick

owns 6,093,560 shares, or nearly 7.13% of the Company’s outstanding common stock.

13. Defendant V. James Marino (“Marino”) has served as President, Chief Executive

Officer and a director of the Company since November 2006. Marino has served as president of

Alberto-Culver Consumer Products Worldwide from 2004 to November 2006. Marino served as

President of Alberto Personal Care Worldwide, a division of Alberto-Culver, from 2002 to 2004.

14. Defendant King W. Harris (“Harris”) has served as a director of Alberto -Culver

since 2002. Harris is also the Chairman of Harris Holdings, Inc., and a non-executive Chairman

of the AptarGroup, I nc.

5


15. Defendant Robert H. Rock (“Rock”) has served as a director of Alberto -Culver

since 1995. Rock is also a director of Quaker Chemical Corporation, Advanta Corporation, and

Penn M utual Life Insurance Company.

16. Defendant Thomas A. Dattilo (“Dattilo”) has served as a director of Alberto -

Culver since December 2006. Dattilo is the former president, chief executive officer, and

chairman of Cooper Tire & Rubber Company.

17. Defendant Sam J. Susser (“Susser”) has served as director of Alberto- Culver since

2001. Susser is also a director of Susser Holdings Corporation.

18. Defendant James R. Edgar (“Edgar”) has served as a director of Alberto-Culver

since 2002. Edgar is a former governor of Illinois and is currently a director of Horizon Group

Properties, Inc., John B. Sanfi l i ppo & Son, Inc. and Youbet.com , Inc.

19. Defendant James G. Brocksmith, Jr. (“Brocksmith”) has served as a director of

Alberto-Culver since 2002. Brocksmith is the former deputy chairman and chief operating

officer of KPM G Peat Marwick L L P. Brocksmith is also a director of Sempra Energy and AA R

Corporation.

20. Defendant George L. Fotiades (“Fotiades”) has served as a director of Alberto -

Culver since December 2006.

21. The defendants listed in paragraphs 11 through 20 are collectively referred to

herein as the “Individual Defendants.”

22. Defendant Unilever N.V. is a Dutch corporation.

23. Defendant Unilever PLC is an English corporation.

24. Defendants Unilever N.V. and Unilever PLC have separate legal identities and

stock exchange listings, however, they function as a single operating business, which produces

6


and markets home, nutrition, beauty and personal care products worldwide. Unilever is

especially known for its leading position in emerging markets. Unilever’s portfolio features

iconic brands such as Dove, TIGI, Lux, Axe/Lynx, Omo/Persil/Ala/Skip, Domestos/Glorix,

Knorr, Hel mans and Lipton.

25. Defendant Conopco, Inc. is a New York corporation, and is a party to the Merger

Agreement.

26. Defendant ACE Merger, Inc. is a Delaware corporation and wholly owned

subsidiary of defendant Conopco, Inc, and is a party to the Merger Agreement.

CLASS ACTION ALLEGATIONS

27. Plaintiff brings this action pursuant to Federal Rule of Civil Procedure 23, on their

own behalf and as a class action on behalf of all holders of Alberto-Culver common stock who

are being and will be harmed by defendants’ actions described below (the “Class”). Excluded

from the Class are defendants herein and any person, firm, trust, corporation, or other entity

related to or affiliated with any defendants.

28. This action is properly maintainable as a class action. The Class is so numerous

that joinder of all members is impracticable. As of June 30, 2010, there were approximately 98.6

million shares of the Company’s common stock outstanding. Shareholders are scattered

throughout the United States. The actual number of public shareholders of Alberto-Culver will

be ascertained through discovery.

29. There are questions of law and fact which are common to the Class and which

predominate over questions affecting any individual Class member, including:

(a) whether Alberto-Culver and the Individual Defendants misrepresented and

omitted material facts in the Proxy in violation of Section 14(a) of the Exchange Act and Rule

14a-9 thereunder;

7


(b) whether the Individual Defendants have breached their fiduciary duties of

undivided loyalty, independence or due care with respect to Plaintiff and the other members of

the Class in connection with the Proposed Transaction;

(c) whether the Individual Defendants are engaging in self-dealing in

connection with the Proposed Transaction;

(d) whether the Individual Defendants have breached their fiduciary duty to

secure and obtain the best price reasonable under the circumstances for the benefit of Plaintiff

and the other members of the Class in connection with the Proposed Transaction;

(e) whether all material information has been disclosed regarding the

Proposed Transaction;

(f) whether the Individual Defendants breached their fiduciary duties by

“locking up” the Proposed Transaction to the detriment of the Class by approving the “no shop”

provision, “Matching Right” provision, and Termination Fee without obtaining adequate

consideration for Alberto-Culver public shareholders;

(g) whether the Individual Defendants are unjustly enriching themselves and

other insiders or affiliates of Alberto-Culver;

(h) whether Unilever aided and abetted the breach of fiduciary duties of the

Individual Defendants; and

(i) whether Plaintiff and the other members of the Class would suffer

irreparable injury were the transactions complained of herein consummated.

30. Plaintiff’s claims are typical of the claims of the other members of the Class, and

Plaintiff does not have any interests adverse to the Class.

8


31. Plaintiff is adequate representatives of the Class, have retained competent counsel

experienced in litigation of this nature, and will fairly and adequately protect the interests of the

Class.

32. The prosecution of separate actions by individual members of the Class would

create a risk of inconsistent or varying adjudications with respect to individual members of the

Class, which would establish incompatible standards of conduct for the party opposing the Class.

Therefore, this class action is a superior method for the fair and efficient adjudication of this

controversy.

33. Plaintiff anticipates that there will be no difficulty in the management of this

litigation. A class action is superior to other available methods for the fair and efficient

adjudication of this controversy.

34. Defendants have acted on grounds generally applicable to the Class with respect

to the matters complained of herein, thereby making appropriate the relief sought herein with

respect to the Class as a whole.

SUBSTANTIVE ALLEGATIONS

I. Alberto-&XO q HU¶Voq+

35. In 1955, Chicago entrepreneur Leonard Lavin purchased a California beauty

supply company. The Company has been run essentially as a family-run business ever since.

Until 2006, the Company’s core businesses consisted of consumer goods manufacturing and

marketing, as well as beauty supply stores. In 2006, the Company spun off its Sally’s Beauty

Supply Stores and its Beauty Systems Groups to focus its business on the manufacturing and

marketing of consumer products, including the expansion of the Company’s Alberto VO5

Hairdressing products. The change of focus to consumer products was highly successful.

9


Within three years, Alberto VO5 Hairdressing became the country’s number one selling

shampoo, and it retains that rank to this day.

36. The Company’s success from the increased focus on consumer products has also

been reflected in the Company’s financial results, producing double-digit growth in net sales,

which has translated into a steady and consistent increase in the Company’s stock price despite

the downturn in the economy.

37. For example, for the second fiscal quarter of 2010, which ended on March 31,

2010, the Company’s net sales increased 11.8% to $384.8 million compared to $344.3 million in

same quarter for the year before. During the quarter, diluted EPS from continuing operations

also increased 7.1 % to 30 cents per share.

38. Commenting on these positive results, defendant Marino stated:

The strength of our brands, led by TRESemme, has enabled us to continue toshow positive momentum and generate especially strong growth in ourinternational markets.

39. Similarly, on July 26, 2010, Alberto-Culver announced that its net sales for the

third quarter of 2010 increased 18.8% to $417.6 million, compared to $351.6 million in the same

quarter the year before. On an organic basis alone, sales increased 10.7%, diluted earnings from

continuing operations increased over 40%, and diluted earnings per share from continuing

operations increased 30%.

40. Defendant Marino commented on the Company’s strong growth in the third-

quarter, stating:

I am very pleased to report an exceptionally strong quarter of sales and earningsgrowth in both our U.S. and international segments. Despite challengingeconomic conditions and soft category growth rates, we continue to outperformthe hair care category and gain market share. Double-digit organic sales growthwas broad based across our core beauty care brands. (Emphasis added).

10


41. Likewise, for the first nine months of fiscal year 2010 (“FY 2010”), net sales

increased 11.1 %, from $1.05 billion to $1.17 billion, compared with the same period in 2009.

Similarly, the Company’s diluted earnings per share from continuing operations for the first nine

months of FY 2010 increased from $0.87 per share to $1.14 per share, an increase of

approximately 25% compared to the prior year period. Excluding restructuring and discrete

items, diluted earnings per share from continuing operations increased 17.2%, from $0.99 per

share to $1.16 per share, compared to the prior year.

42. Defendant Bernick characterized these results as follows:

As evidenced by our strong third quarter results, we were able to successfullyovercome a difficult economic environment, resolve our U.S. service issues thatplagued us earlier in the year and deliver growth for our shareholders. Ourbalanced portfolio of strong beauty care brands and our dedicated teamcontinue to be the primary drivers of our success. (Emphasis added).

43. Moreover, even in the current weakened economy, sales of personal care

products, like those manufactured by Alberto-Culver, are expected to grow significantly in the

coming years. Mark Whalley, a consumer goods analyst at Datamonitor, predicts that sales of

personal care products in the B RIC nations ( i.e., Brazil, Russia, India and China) will grow by

more than 40% between 2009 and 2014. As reported by Parmy Olson of Forbes, in a September

27, 2010 article entitled “ Unilever Looks to Clean Up in Emerging Markets with Shampoo,

Conditioner,” Whalley has stated that “the industry as a whole has been growing despite the

recession because people aren’t prepared to cut back on personal care because of the feel-good

factor. In these emerging markets there’s a certain degree of following Western fashion trends,

and using these kinds of more expensive products.” Thus, based upon Alberto-Culver’s renewed

focus on consumer products, its recent performance, and the growing market for personal care

products, the Company is poised for exceptional growth of sales, revenue, and earnings.

11


44. While the Company recently has seen significant improvement in its financial

performance, the Lavin family has experienced significant changes that have affected the

Company’s corporate composition. In 2005, defendant Bernick and her husband Howard, the

one-time CEO of the Company, surprised the Board and shareholders with their decision to

separate after 30 years of marriage. Simultaneously, defendant Lavin began suffering severe

health problems, and his wife and the Company’s co-founder, Bernice, passed away.

Consequently, members of the Lavin family began selling large portions of their equity in the

Company.

45. Rather than permitting the Company’s shares to trade freely, and allowing its

public shareholders to reap the benefits of the Company’s focus on consumer products – which

has produced double digit growth – the Individual Defendants have acted for their own benefit

and the benefit of Unilever, and to the detriment of the Company’s public shareholders, by

entering into the Proposed Transaction. Notably, defendants Lavin and Bernick are attempting

to use the Proposed Transaction to cash out their substantial holdings of Alberto-Culver stock

entirely. In so doing, the Individual Defendants have effectively placed a cap on Alberto-

Culver’s corporate value at a time when the Company is enjoying a highly encouraging financial

outlook and is poised to capitalize on its focus on consumer products in a growing market.

II. Background of the Proposed Transaction

46. The Individual Defendants never bothered to engage in an auction sales process or

even conduct any sort of pre-merger or post-merger market check, and consequently, have failed

to secure for the Company’s shareholders the highest price available for their shares. Despite the

Company’s recent double-digit growth and positive financial prospects, inexplicably, the

12


Individual Defendants put the Company “in play,” but only approached only one bidder -

Unilever.

47. In April 2010, the Board met with management to discuss the Company’s

prospects and determined that Alberto-Culver could continue its historic growth, but only with

increased levels of investment, which would affect the Company’s, risk profile.

48. On April 28, 2010, an investment banker purporting to represent another company

in the same industry as Alberto-Culver (“Company A”) contacted defendant Bernick regarding

setting up a meeting between Alberto-Culver and Company A to discuss a potential acquisition

of the Company. Alberto-Culver was never ultimately contacted by representatives of Company

A, and the Board concluded that the investment banker had been acting without authorization

from Company A.

49. On June 9, 2010, the Individual Defendants held a telephonic meeting of the

Board in which representatives of BDT & Company, LLC (“BDT”) participated. The senior

principal of BDT, Byron Trott, had previously advised the Company in connection with its 2006

transaction involving Sally Beauty Holdings, Inc., as a senior investment banker at a global

investment bank. Just prior to the June 9, 2010 meeting, BDT had been hired to represent

Bernick and Lavin regarding their family’s holdings, including their interest in the Company. At

the meeting, BDT, which the Board eventually retained as a financial advisor, disclosed that

Unilever might be interested in acquiring Alberto-Culver because of its “publicly, articulated

business strategy, its relative position in the personal care category as a regulatory matter, and its

financial capacity.”

50. On June 22, 2010, after management had previously met with BDT at the Board’s

direction, the Board engaged BDT to advise it in connection with a possible sale of the

13


Company. BDT was engaged despite its potential conflict of interest, having previously been

retained by defendants Bernick and Lavin, whose interests may be adverse to those of the

Company and its shareholders.

51. Also on June 22, 2010, the Board met with BDT and authorized it to approach

Unilever regarding a possible acquisition of the Company. BDT was not authorized to reach out

to any other potential acquirers, including Company A . Also at the meeting, the Board discussed

the fact that B DT has a policy of not issuing fairness opinions and that the Board would need to

retain an additional investment bank to provide a fairness opinion if the Board decided to pursue

a sale of the Company.

52. Between June 2010 and September 2010, Alberto-Culver and Unilever, through

their respective management and financial advisors negotiated the price per share of the

Proposed Transaction.

53. On August 17, 2010, the Board held a telephonic meeting to discuss the status of

negotiations between Alberto-Culver and Unilever. Present for the call were representatives of

BDT, who offered the conclusory opinion that financial buyers would not be able to offer as

much as strategic buyers, and that involving strategic buyers other than Unilever in the process

would be disruptive and would not be reasonably likely to result in another party offering a

higher price than Unilever.

54. On September 10, 2010, Unilever CEO Paul Polman telephoned defendant

Bernick to indicate that Unilever would be willing to acquire the Company for $37.50 a share.

On the same day, the Board voted unanimously to continue discussions with Unilever regarding

an acquisition of the Company for $37.50 per share.

14


55. On September 17, 2010, Credit Suisse Securities (USA) LLC (“Credit Suisse”)

was engaged by the Board to advise them regarding the Proposed Transaction and render a

fairness opinion.

56. Between September 20, 2010 and September 27, 2010, legal counsel for the

Company and Unilever negotiated the terms of the Merger Agreement.

57. On September 26, 2010, the Board met to review the proposed Merger

Agreement. Present at the meeting were representatives from BDT, Credit Suisse, and also from

the Company’s counsel Sidley Austin LLP. BDT presented its comments regarding the

Proposed Transaction and reiterated its position that Unilever was the most logical strategic

acquirer for the Company because: (a) its publicly articulated business strategy; (b) its relative

position in the personal care category as a regulatory matter; and (c) its financial capacity.

Credit Suisse rendered its oral opinion that the Proposed Transaction was fair to Alberto-Culver

shareholder. The Board then unanimously approved the Merger Agreement, which was executed

on September 27, 2010.

III. The Proposed Transaction

58. On September 27, 2010, Alberto-Culver announced that it had entered into an

agreement to be acquired by Unilever for $37.50 per share in cash, a meager 19% premium to

Alberto-Culver’s closing stock price on the trading day immediately preceding the deal’s

announcement. The Company’s press release stated:

Alberto Culver Company (NYSE: ACV), a $1.6 billion in revenue leadingmanufacturer and marketer of beauty care brands including TRESemmé, AlbertoVO5, Nexxus, St. Ives, Simple and Noxzema, today announced that it has enteredinto a definitive agreement in which Unilever will acquire all of the outstandingshares of Alberto Culver for $37.50 per share in cash, valuing the company atapproximately $3.7 billion. The transaction is structured as a merger and issubject to approval by owners holding a majority of Alberto Culver’s outstandingshares, regulatory approvals and other customary closing conditions. The merger

15


agreement was unanimously approved by the Boards of Directors of bothcompanies. The announcement was made by Carol Lavin Bernick, ExecutiveChairman, on behalf of the Alberto- Culver Board of Directors.

The $37.50 per share price represents a 33 percent premium to Alberto- Culver’s12-month volume weighted average share price and an 18 percent premium to itsall -time high closing share price achieved earlier this year.

* * *BDT & Company, LLC acted as Alberto Culver’s financial advisor on thetransaction. Credit Suisse Securities (USA) LLC advised by providing a fairnessopinion to Alberto Culver’s board of directors. Sidley Austin LLP served asAlberto Culver’s legal advisor on the transaction.

Alberto Culver Company manufactures, distributes and markets leading beautycare and other personal care brands including TRESemmé, Alberto VO5, Nexxus,St. Ives, Simple and Noxzema in the United States and internationally. It is alsothe second largest producer in the U.S. of products for the ethnic hair care marketwith leading brands including Motions and Soft & Beautiful. Several of itshousehold/grocery brands such as Mrs. Dash and Static Guard are niche categoryleaders in the U.S.

59. Commenting on the Proposed Transaction, defendant Bernick stated:

Throughout our history, and particularly in the last decade, we have grownAlberto Culver’s key brands’ sales and market shares at a pace exceeding ourhighly competitive categories’ growth rates. This has been the result of acombination of innovation, excellent service and entrepreneurial drive, allplanned and executed by an incredibly talented team. Our shareholders havebenefitted year in and year out from their efforts. We are enormously proud ofour people and what they have accomplished.

However, viewing the global marketplace today, we believe that for these brandsto achieve their full potential, they need to be able to compete in all major globalmarkets. Given the resources this would require, our brands’ chances for successare better served by being merged into a larger organization with an even largerglobal footprint than Alberto Culver’s. We believe Unilever is such a companyand we believe we are maximizing value for our shareholders through thisagreement.

60. Similarly, defendant Marino, commented on the proposed Transaction stating:

The credit for our growth goes to an outstanding Alberto Culver team. Our peopleexhibit a sense of urgency and demonstrate a commitment to growth throughbrand building and innovation that have consistently made us winners in ourcategories. Unilever has a long and distinguished history, and we look forward to

16


our brands making an important contribution to the company’s growth goingforward. Both we and Unilever are committed to moving expeditiously toclosing.

61. Unilever simultaneously announced that the Proposed Transaction of Alberto-

Culver represented a highly beneficial acquisition in an extremely high growth segment of the

market, stating:

The acquisition makes Unilever the world’s leading company in hairconditioning, the second largest in shampoo and the third largest in styling, andsignificantly enhances its hair care presence in the US, Canada, the UK, Mexicoand Australasia, all of which will be significant hair care markets for years tocome.

The deal fulfils a number of key criteria for Unilever. It:

• Enhances Unilever’s presence in an attractive, high-growth category.• Brings a portfolio of attractive brands which have together grown at above

market growth rates in a competitive category.• Provides Unilever with the opportunity to use its scale, reach and technology

to take Alberto Culver’s brands to a new level in existing markets and extendtheir presence to new emerging markets.

• Adds successful styling and conditioning brands like TRESemmé and Nexxusto Unilever’s US portfolio, complementing its own brands such as Suave,Dove and Sunsi l k.

• Adds complementary brands like VO5, TRESemmé and Simple that enableUnilever’s UK business to cover more price points across categories.Unilever today announced that it has entered into a definitive agreement toacquire the US-based.

62. Paul Pol man, CEO of Unilever commented:

We are delighted to be acquiring Alberto Culver. Their people have done anexcellent job of building an impressive range of brands such as TRESemmé,VO5, Nexxus, St. Ives and Simple. These will complement Unilever’s existingportfolio of iconic brands like Dove, Clear and Sunsilk in hair care and Pond’sand Vaseline in skin and will help build on our strong global positions in both thehair care and skin care categories.

Personal Care is a strategic category for Unilever and growing rapidly. Ten yearsago it represented 20% of our turnover; strong organic growth has driven it tonow reach over 30%, with strong positions in many of the emerging markets.

17


Organic growth remains the cornerstone of our energising ambition to double thesize of Unilever whilst reducing our overall environmental impact. Bolt-onacquisitions such as Alberto Culver supplement organic growth and add powerfulnew brands to our portfolio.

63. According to a Questions and Answers memorandum (the “Q&A”) distributed

internally at the Company, and filed with the SEC on September 27, 2010, Alberto-Culver and

Unilever first began discussing a potential sale a few months ago. Specifically, Response N o.8

to the Q&A states:

We knew from discussions with numerous bankers and investment advisors thatUnilever had a commitment to growing their personal care business and theirinfrastructure, geographic footprint and resources could provide acceleratedgrowth for our brands. Through our banker we approached Unilever.Discussions with Unilever leadership have been underway for a few months.(emphasis added)

64. Despite impressive sales results and remarkable growth prospects, as described

above, the Alberto-Culver Board somehow believed that now was the appropriate time to

conduct what amounted to a hasty sale of the Company.

65. Also in the Q&A, Alberto-Culver admitted that after approaching Unilever about

a transaction, the Board never attempted to confirm whether the Proposed Transaction

represented the best possible strategic alternative for Alberto-Culver’s public shareholders.

Question and Response No.9 states:

9. Did the Board actively explore the possibility of other buyers?

The BOD explored the opportunity with Unilever and the discussions led to afinancially compelling offer for our shareholders and a strategically compellingopportunity for our brands and business. And, as is clear from their offer, theyclearly value the brands highly and believe they can grow them dramatically.

66. The consideration offered to Alberto-Culver’s public stockholders in the Proposed

Transaction is unfair and grossly inadequate because, among other things, the intrinsic value of

Alberto-Culver’s common stock is materially in excess of the amount offered for those securities

18


in the Proposed Transaction given the Company’s recent financial performance and prospects for

future growth and earnings. It is also unclear how the Board could be confident that the

Proposed Transaction proposes a “financially compelling” offer since it did not conducted a

market-check to gauge Unilever’s purchase price.

67. Additionally, the Company’s assertion that the Proposed Transaction provides

“strategically compelling opportunity for our brands and business” is illustrative of the Board’s

failure to satisfy its fiduciary obligations to the Company’s public shareholders. Shareholders

will be cashed out of the business upon consummation of the Proposed Transaction and thus,

future opportunities of the Company are irrelevant to them.

68. Analysts have confirmed that the Company is worth more than the consideration

offered in the Proposed Transaction. For instance, on September 27, 2010, a J.P. Morgan analyst

commented, “The deal does not seem particularly rich to us. . . . Given the scarcity of attractive

assets in the personal care space and no seeming urgency for management to sell the business,

we think the price is a bit low.”

69. Likewise, as reported by Anjali Cordeiro in an article entitled “ Unilever, Alberto-

Culver Deal to Ramp Up Competition In Beauty ,” released on the Dow Jones Newswire service

on September 27, 2010, Glenn Shaw, an analyst at Atlanta Capital stated that he “expected a

valuation of [the Company] $4 billion or more since Alberto is growing margins and the deal

will add to Unilever’s earnings.” Cordeiro also reported that Ali Dibadj, an analyst for Sanford

Bernstein, opined that he “would not say that the acquisition is particularly expensive.”

70. To further confirm the inadequacy of the consideration offered in the Proposed

Transaction, immediately following the announcement of the Merger Agreement, analysts at

Caris & Company downgraded Alberto-Culver stock from “Above Average” to “Average.”

19


71. The market has also confirmed that the consideration offered in the Proposed

Transaction is inadequate. Following the announcement of the Proposed Transaction, Alberto-

Culver’s share price quickly rose above the $37.50 Proposed Transaction price, trading as high

as $37.93 per share on September 27, 2010. Sandra Guy has reported in the Chicago Sun Times

that some analysts believe that this market price reaction to the Proposed Transaction indicates

that investors believe the Company is worth more than the Proposed Transaction price.

72. The Individual Defendants, however, fare far better under the terms of the

Proposed Transaction. First, according to the Company’s December 14, 2009 proxy statement,

defendants Lavin and Bernick still own approximately 14 million shares of Alberto-Culver stock

– the vast majority of the 13.14% of Company stock owned by insiders. By orchestrating the

Proposed Transaction, the Lavin family is able to liquidate its remaining $525 million block of

otherwise highly illiquid stake in the Company. Second, as part of the Proposed Transaction,

Unilever has expressed interest in Alberto-Culver’s key executives, and it is anticipated that the

Company’s key executives, including defendant Marino will secure lucrative continued

employment with the surviving company.

73. Under the circumstances, the Individual Defendants were obligated – but utterly

failed – to explore all alternatives to maximize shareholder value.

IV. The Alberto-Culver Board Agreed to Sell the Company to Unilever forInadequate Consideration

74. The merger consideration of the Proposed Transaction is inadequate when

examined with even minimal scrutiny. The premium offered in the Proposed Transaction fails to

account for: (a) Alberto-Culver’s stellar sales and earnings per share during the last two fiscal

quarters, as discussed above, and (b) the explosive anticipated future growth in the personal care

products industry.

20


75. The Board should have leveraged Unilever’s heightened demand for the

Company’s products to extract a substantially higher premium and a more favorable Merger

Agreement. For example, the Offer Price fails to properly account for ongoing growth in the

personal care products segment of the consumer products industry. Instead, the Individual

Defendants hastily locked-up a deal with Unilever before ever fulfilling their fiduciary duties to

maximize shareholder value in a change of control transaction such as this one.

76. In addition, Alberto-Culver’s stock price in the wake of the Proposed

Transaction’s announcement casts serious doubts on the adequacy of the offered consideration.

On September 28, 2010, the day after the deal was announced, the Company’s stock was trading

over the Offer Price. That Alberto-Culver’s stock has already traded over the Proposed

Transaction price indicates that the market believes that the Proposed Transaction does not

provide full and fair value for the Company’s shares.

77. In negotiating the Proposed Transaction, the Board abandoned opportunities to

secure the highest price reasonably available for the Company, even if that price were to

ultimately come from Unilever. Obvious potential suitors – such as L’Oreal SA, Henkel AG,

and Beiersdorf AG – were never contacted or appropriately considered by the Board. Further,

these companies and other potential Alberto-Culver buyers who may wish to outbid Unilever for

the Company are now hamstrung by the harmful deal protections included in the Merger

Agreement which are further described below.

78. Alberto-Culver’s public shareholders have a right to receive consideration that

accurately accounts for the Company’s bright prospects, stellar past performance, and significant

brand recognition. Yet the Board negotiated exclusively with Unilever and agreed to the

Proposed Transaction in violation of the duties owed to the Company’s public shareholders.

21


V. The Alberto-Culver Board Agreed to Deal Protections That ImproperlyStrip the Board of the Ability to Properly Exercise Their Fiduciary Duties

79. Not only did the Board fail to maximize shareholder value in agreeing to the

proposed transaction and failing to approach any other potential buyers or otherwise conduct any

form of market check, the Merger Agreement contains a number of onerous and preclusive

provisions which make approval of the Proposed Transaction a virtual fait accompli.

80. First, the Board failed to negotiate for a “Go-Shop” provision. In light of the

Board’s decision to initiate sales dialogue, and enter exclusive negotiations with Unilever, a

“Go-Shop” provision is the only way to ensure that shareholders receive the highest value

reasonably available for their shares. While not a perfect substitute for a pre-signing auction, a

“Go-Shop” provision could serve a similar function by allowing the Board to canvas the market

to determine whether potential suitors are interested in making a competing bid.

81. Instead of negotiating for a “Go-Shop” provision, the Board agreed to a

prohibitive “No Solicitation” clause (the “no shop” provision), further limiting the Board’s

ability to entertain superior strategic alternatives. Specifically, the Merger Agreement contains a

strict “no shop” provision barring Alberto-Culver from soliciting any competing bids – despite

the fact that the Individual Defendants had failed to conduct a market check. The practical effect

of this is that logically, potential suitors such as L’Oreal SA, Procter & Gamble, Henkel AG, and

Beiersdorf AG are now effectively deterred by these provisions from coming forward with a

competing offer and are therefore even less likely to pursue the Company. Section §4.02(a) of

the Merger Agreement provides:

The Company shall not, nor shall it authorize or permit any of its Subsidiaries orany of its or their respective directors, officers or employees or any investmentbanker, financial advisor, attorney, accountant or other advisor, agent orrepresentative (collectively, “Representatives”) retained by it or any of itsSubsidiaries to, directly or indirectly through another person, (i) solicit, initiate orknowingly encourage, induce or facilitate any Takeover Proposal or any inquiry

22


or proposal that could reasonably be expected to lead to a Takeover Proposal or(i i) enter into, continue or otherwise participate in any discussions or negotiationsregarding, or furnish to any person any information with respect to, or otherwisecooperate in any way with, any Takeover Proposal or any inquiry or proposal thatcould reasonably be expected to lead to a Takeover Proposal.

82. As written, the no-shop provision prevents Alberto-Culver from even encouraging

competing bids for the Company. This is the very antithesis of maximizing shareholder value,

which is a core duty of directors of a publicly held company.

83. The “no shop” provision is already costing Alberto-Culver shareholders the

opportunity to receive maximum value for their shares. Even though the Company’s stock has

already traded above the Unilever Offer Price since the Proposed Transaction was announced,

the Board is barred from exploring strategic alternatives to the Proposed Transaction.

84. Second, the Merger Agreement gives Unilever with an unlimited “Matching

Right” regarding any “Superior Proposal” to persuade the Board to continue recommending the

Proposed Transaction despite the emergence of a superior offer. Specifically, § 4.02(b)(iii) of

the Merger Agreement provides:

Notwithstanding Section 4.02(b)(i), at any time prior to obtaining the StockholderApproval, if the Company receives a Takeover Proposal which the Board ofDirectors of the Company determines in good faith (after consultation withoutside counsel and a financial advisor of nationally recognized reputation)constitutes a Superior Proposal, the Company may terminate this Agreement toenter into a definitive agreement with respect to such Superior Proposal if theBoard of Directors of the Company determines in good faith (after consultationwith outside counsel and a financial advisor of nationally recognized reputation)that the failure to do so would be inconsistent with its fiduciary duties underapplicable law; provided, however, that the Company shall not terminate thisAgreement pursuant to this Section 4.02(b )(iii), and any purported terminationpursuant to this Section 4.02(b )(iii) shall be void, unless (A) the Company hasnot breached or failed to perform any of its representations, warranties, covenantsor agreements set forth in this Agreement, including in this Section 4.02, such thatthe conditions set forth in Section 6.02(a) or 6.02(b) could not then be satisfied,(B) concurrently with such termination the Company pays the termination feepayable pursuant to Section 5.06(b), (C) the Company has provided prior writtennotice to Parent that the Company intends to terminate this Agreement to enter

23


into a definitive agreement with respect to such Superior Proposal (a “Notice ofSuperior Proposal”), which notice shall specify the material terms and conditionsof such Superior Proposal (including the identity of the third party or groupmaking such Superior Proposal) and attach a copy of the definitive agreementproposed to be entered into with respect to such Superior Proposal, (D) theCompany has negotiated in good faith (including by complying with itsobligations under Section 4.02(b)(iv)) with Parent with respect to anychanges to the terms of this Agreement proposed by Parent for at least fivebusiness days following receipt by Parent of such Notice of Superior Proposal(it being understood and agreed that any amendment to any material term of suchSuperior Proposal shall require a new Notice of Superior Proposal and anadditional three business day period from the date of such notice) and (E) takinginto account any changes to the terms of this Agreement proposed by Parentto the Company, the Board of Directors of the Company has determined ingood faith (after consultation with outside counsel and a financial advisor ofnationally recognized reputation) that such Superior Proposal continues tomeet the definition of the term “Superior Proposal” and the failure by it to DQG q Mterminate this Agreement to enter into the definitive agreement with respectto such Superior Proposal would be inconsistent with its fiduciary dutiesunder applicable law. (emphasis added)

85. The Matching Right dissuades interested parties from making an offer for the

Company by providing Unilever the opportunity to make repeated matching bids to counter any

competing offers. Due to the complete absence of any pre-signing market check, no justification

exists for the inclusion of the Matching Right and other bid advantages in the Merger

Agreement.

86. Third, §5.06 of the Merger Agreement requires Alberto-Culver to pay an onerous

termination fee of $125 million in the event the Company were to accept a superior offer from

another bidder. This termination fee, coupled with the Individual Defendants’ failure to ensure

that the Company was adequately shopped either before or after the signing of the Merger

Agreement, effectively precludes another bidder from submitting a superior offer for the

Company by driving up the cost of the acquisition. It also transfers money to Unilever that

otherwise would otherwise be available to be paid to Alberto-Culver shareholders as additional

merger consideration.

24


87. To further assure that Unilever alone is able to purchase the Company,

concurrently with the execution of the Merger Agreement, Unilever also entered into the Voting

Agreement that irrevocably binds the Company’s largest individual shareholders, namely

defendants Lavin and Bernick who collectively own approximately 13% of the Company’s

shares, to vote in favor of the Proposed Transaction.

88. Cumulatively, the “no shop” and “matching rights” provisions, the termination

fee, and the Voting Agreement were all designed to effectively discourage bidders from making

a competing bid for the Company and prevent the Board from properly exercising their fiduciary

duties to pursue and obtain the best available strategic alternative – and resulting maximum value

– for Alberto-Culver’s shareholders.

89. The Deal Protections are simply unreasonable barriers to competing offers and

substantially increase the likelihood that the Proposed Transaction will be consummated, leaving

Alberto-Culver public shareholders with limited opportunity to consider any superior offer.

When viewed together, and in light of the now non-existent premium offered by the Proposed

Transaction, these provisions cannot be justified as reasonable or proportionate measures to

protect Unilever’s investment in the transaction process. This is particularly true in light of the

fact that Alberto-Culver reached out to Unilever, streamlining the sale process for the Board’s

favored buyer.

VI. The Materially Misleading and/or Incomplete Proxy

90. In order to secure shareholder approval of this unfair deal, defendants filed the

SEC a materially misleading and incomplete Preliminary Proxy on October 15, 2010. The

Preliminary Proxy, which recommends that Alberto Culver’s shareholders vote in favor of the

Proposed Transaction, omits and/or misrepresents material information about the unfair sale

25


process, the unfair consideration, and the true intrinsic value of the Company. Specifically the

Proxy omits/or misrepresents the material information set forth below in contravention of § 14(a)

and §20(a) of the Exchange Act.

91. Notwithstanding the Defendants requirements under federal law and the

Individual Defendants’ fiduciary duty of candor to Alberto-Culver’s shareholders, the

Preliminary Proxy fails to disclose numerous items of material information including, but not

limited to, the following:

a. All analyses undertaken by BDT discussing why BDT believed that onlyUnilever should be approached regarding a potential acquisition andwhether it investigated other potential companies including “Company A”(page 12 of the Proxy);

b. A description of the Company’s long-term strategic business plan, whichwas discussed during the June 11, 2010 Board meeting with themanagement team and BDT. Such information would be important forAlberto-Culver shareholders attempting to determine the fairness of theOffer Price in the Proposed Transaction (page 12 o the Proxy);

c. A description of the business relationship between BDT and Unilever,including all financial services it provided to Unilever during the past fiveyears. Such information would be important for Alberto-Culvershareholders attempting to determine whether the recommendations ofBDT to the Board were unbiased;

d. The underlying methodologies, projections, key inputs and multiplesrelied upon and observed by Credit Suisse which are necessary forshareholders to evaluate and properly assess the credibility of the variousanalyses performed by Credit Suisse and which were relied upon by theBoard in approving the Proposed Transaction;

e. The reason why no market check was performed by Alberto-Culver toverify the competitiveness of the Offer Price and to ensure themaximization of return to Alberto-Culver shareholders. Such a marketcheck would be expected by Alberto-Culver shareholders given that theIndividual Defendants secured no increase in the price offered byUnilever;

f. The consideration given by the Board as to the timing and terms of anyemployment agreements between Alberto-Culver directors and/or

26


management and Unilever, including information as to whether anyCompany directors and/or management anticipated to be employed byUnilever were engaged in merger negotiations. Such information iscritical to Company shareholders in assessing whether conflicts existedbetween Alberto-Culver directors and/or management and Unilever, andtherefore, whether merger negotiations were conducted in the bestinterests of Alberto-Culver shareholders;

g. The reasons why the Board retained BDT, which recently provided ananalysis for the Lavin family regarding the family’s holdings, includingownership in the Company, and why the relationship between the Lavinfamily and BDT did not create a conflict of interest. Such information isessential to Alberto-Culver shareholders who must verify that theinformation provided to the Company’s financial advisor to assist theCompany in analyzing and considering strategic alternatives, including thepossible sale of the Company, would be impartial;

h. Additional information as to possible alternative strategies other than theProposed Transaction as well as the prospects of Alberto-Culver as anindependent company. Such information would be important to Alberto-Culver shareholders attempting to determine the fairness of the Offer Pricein the Proposed Transaction;

i . The bases for defendants Bernick and Marino and BDT’s recommendationthat the Board respond with a valuation range of between $37 and $41 pershare to Unilever’s offer and the opinion that potential financial bidderswould not be able to offer as much as strategic buyers (p. 14 of the Proxy);

j. The reasons why the Board did not form a special committee ofdisinterested Alberto-Culver directors to evaluate the ProposedTransaction and to ensure merger negotiations were conducted in the bestinterests of Alberto-Culver public shareholders;

k. Additional information concerning whether the final forecasts provide bythe Company to Unilever and Credit Suisse, including projected net sales,EBIT, EBITDA, and net income, was considered by Credit Suisse inrendering its fairness opinion. Such information would be important toAlberto-Culver shareholders attempting to determine the fairness of theOffer Price in the Proposed Transaction;

l. Additional information as to why Credit Suisse made no assessment of thereasonableness or reliability of the Company’s financial forecasts and thejudgment of management with respect to the Company’s future financialperformance (p. 20 of the Proxy);

27


m. Additional information as to why Credit Suisse made no assessment withrespect to the merits of the merger as compared to alternative transactionsor strategic strategies available to the Company (p. 20 of the Proxy);

n. Additional information with respect to how much compensation CreditSuisse expects to receive in connection with financial services provided inconnection with the Proposed Transaction (p. 25 of the Proxy);

o. Additional information with respect to how much compensation CreditSuisse received for providing financial services to Alberto-Culver duringthe past two years. (page 25 of the proxy)

p. A complete description of all services Credit Suisse provided to Unileverduring the past two years and the amount of compensation was receivedfor services rendered (p. 25 of the proxy);

q. Annual projections of deferred taxes and stock option expenses separately.(p. 26 of the proxy); and

r. Additional information whether stock option expenses was subtracted as acash expense or was added back as a non-cash expense in the calculationof free cash flow (p. 26 of the proxy);

92. In addition, the fairness opinion of Credit Suisse, as presented in the Preliminary

Proxy, omits material information necessary for Alberto-Culver’s shareholders to properly

evaluate the methodology utilized by Credit Suisse in its determination that the Offer Price is fair

to Alberto-Culver’s shareholders. Only being fully informed as to the methodology utilized by

Credit Suisse in reaching the determination in its fairness opinion can Alberto-Culver

shareholders verify the accuracy of the fairness opinion and assess its creditability prior to a

shareholder vote. The material omissions, described in detail below, must be remedied by

providing additional information prior to any vote by Alberto-Culver shareholders:

a. With respect to Credit Suisse’ Selected Company’s Analysis (p. 22 of theProxy), the following additional information would be important toAlberto-Culver shareholders attempting to determine the fairness of theOffer Price in the Proposed Transaction:

28


1. the range of multiples selected by Credit Suisse to derivethe implied per share equity reference range for theCompany;

2. the methodology and bases used by Credit Suisse used inselecting the range of multiples it chose to apply to theCompany; and

3. the financial data and multiples used for each of thecomparable companies selected for the analysis or, at aminimum, the low, mean, medium, and high summarystatistics observed for the set including:(a) Enterprise Value/2020E EBITDA(b) Enterprise Value/2011E EBITDA(c) Price/2010E EPS(d) Price/2011 EPS

b. With respect to Credit Suisse’ Selected Transaction Analysis (pp. 23-24of the Proxy), the following additional information would be important toAlberto-Culver shareholders attempting to determine the fairness of theOffer Price in the Proposed Transaction:

1. the range of multiples selected by Credit Suisse to derivethe implies per share equity reference range of theCompany;

2. the methodology and bases Credit Suisse used in selectingthe range of multiples it chose to apply to the Company;and

3. disclosing the announcement date, financial data andmultiples for each of the selected transactions for theanalysis or at a minimum, the low, mean, medium, and highsummary statistics observed for the set including EnterpriseValue/LTM EBITDA

c. With respect to Credit Suisse’ Discounted Cash Flow Analysis (p. 24 ofthe Proxy), the following additional information would be important toAlberto-Culver shareholders attempting to determine the fairness of theOffer Price in the Proposed Transaction:

1. the methodology and bases Credit Suisse used in selectingthe range of terminal EBITDA multiples (9.0x to 11.0x) addiscount rates (7.0% to 8.5%) it used in its analysis;

2. whether the analysis accounts for executive stockcompensation.

.

29


93. Accordingly, Plaintiff seeks injunctive and other equitable relief to prevent the

irreparable injury that Company shareholders will continue to suffer absent judicial intervention.

CLAIMS FOR RELIEF

COUNT I

On Behalf of Plaintiff for Violations of Section 14(a) of the Exchange Act(Against Alberto-Culver and the Individual Defendants)

94. Plaintiff repeats, realleges and incorporates paragraphs 1 through 93 of this

Complaint as if set forth in full herein.

95. Defendants have issued the Proxy with the intention of soliciting shareholder

support of the Proposed Transaction.

96. Rule 14a-9, promulgated by the SEC pursuant to Section 14(a) of the Exchange

Act, provides that such communications with shareholders shall not contain “any statement

which, at the time an in the light of the circumstances under which it is made, is false or

misleading with respect to any material fact, or which omits to state any material fact necessary

in order to make the statements therein not false or misleading.” 17 C.F.R. §240.14a-9.

97. Specifically, the Proxy violates Section 14(a) and Rule 14a-9 because they omit

material facts, including those set forth above. Moreover, in the exercise of reasonable care,

Defendants should have known that the Proxy is materially misleading and omit material facts

that are necessary to render them non-misleading.

98. The misrepresentations and omissions in the Proxy are material to Plaintiff, who

will be deprived of his entitlement to cast a fully informed vote if such misrepresentations and

omissions are not corrected prior to the vote on the Proposed Transaction.

30


COUNT II

On Behalf of Plaintiff for Violations of Section 20(a) of the Exchange Act(Against Alberto-Culver and the Individual Defendants)



100. The Individual Defendants acted as controlling persons of Alberto-Culver within

the meaning of §20(a) of the Exchange Act as alleged herein. By virtue of their positions as

officers and/or directors of Alberto-Culver, and participation in and/or awareness of the

Company’s operations and/or intimate knowledge of the false statements contained in the Proxy

filed with the SEC, they had the power to influence and control and did influence and control,

directly or indirectly, the decision making of the Company, including the content and

dissemination of the various statements which plaintiff contends is false and misleading.

101. Each of the Individual Defendants and Alberto-Culver was provided with or had

unlimited access to copies of the Proxy and other statements alleged by plaintiff to be misleading

prior to and/or shortly after these statements were issued and had the ability to prevent the

issuance of the statements or cause the statements to be corrected.

102. In particular, each of the Individual Defendants had direct and supervisory

involvement in the day-to-day operations of the Company, and, therefore, is presumed to have

had the power to control or influence the particular transactions giving rise to the securities

violations as alleged herein, and exercised the same. The Proxy at issue contains the unanimous

recommendation of each of the Individual Defendants to approve the Proposed Transaction.

Thus they were directly involved in the making of this document.

103. Alberto-Culver also had direct supervisory control over composition of the Proxy

and the information disclosed therein, as well as the information that was omitted and/or

31


misrepresented in the Proxy. Alberto-Culver, in fact, disseminated the Proxy and is, thus,

directly responsible for materially misleading shareholders because it permitted the materially

misleading Proxy to be published to shareholders.

104. In addition, as the Proxy sets forth at length, and as described herein, the

Individual Defendants and Alberto-Culver were each involved in negotiating, reviewing, and

approving the Proposed Transaction. The Proxy purports to describe the various issues and

information that they reviewed and considered, descriptions which had input from both the

directors and Alberto-Culver.

105. By virtue of the foregoing, the Individual Defendants and Alberto-Culver have

violated §20(a) of the Exchange Act.

106. As set forth above, the Individual Defendants and Alberto-Culver had the ability

to exercise control over and did control a person or persons who have each violated § 14(a) and

Rule 14a-9, by their acts and omissions as alleged herein. By virtue of their positions as

controlling persons, these defendants are liable pursuant to §20(a) of the Exchange Act. As a

direct and proximate result of Defendants’ conduct, Plaintiff will be irreparably harmed.

COUNT III

On Behalf of Plaintiff and the Class for Breach of Fiduciary Duties(Against All Individual Defendants)



100. The Individual Defendants have violated fiduciary duties of due care, loyalty,

candor and independence owed to public shareholders of Alberto-Culver and have acted to put

their personal interests ahead of the interests of Alberto-Culver shareholders.

32


101. By the acts, transactions and courses of conduct alleged herein, defendants,

individually and acting as a part of a common plan, are attempting to unfairly deprive Plaintiff

and other members of the Class of the true value of their investment in Alberto-Culver.

102. The Individual Defendants have violated their fiduciary duties by entering into a

transaction with Unilever without regard to the fairness of the transaction to Alberto-Culver

shareholders.

103. As demonstrated by the allegations above, the Individual Defendants failed to

exercise the care required, and breached their duties of due care, loyalty, good faith, candor and

independence owed to the shareholders of Alberto-Culver because, among other reasons:

(a) they failed to take steps to maximize the value of Alberto-Culver to its

shareholders, to cap the price of Alberto-Culver stock, and to give Unilever an unfair advantage

by, among other things, failing to adequately solicit other potential acquirers or alternative

transactions;

(b) they failed to properly value Alberto-Culver; and

(c) they are favoring the Proposed Transaction over other potential

transactions because of loyalties to certain insiders and/or current management.

104. Moreover, the Individual Defendants have failed to fully disclose to Plaintiff and

the Class all material information necessary to cast an informed shareholder vote on the

Proposed Transaction.

105. Because the Individual Defendants dominate and control the business and

corporate affairs of Alberto-Culver, and are in possession of private corporate information

concerning Alberto-Culver’s assets and business as well as the Company’s future prospects,

there exists an imbalance and disparity of knowledge and economic power between them and the

33


public shareholders of Alberto-Culver which makes it inherently unfair for them to pursue any

proposed transaction wherein they will reap disproportionate benefits to the exclusion of

maximizing shareholder value.

106. By reason of the foregoing acts, practices and course of conduct, the Individual

Defendants have failed to exercise ordinary care and diligence in the exercise of their fiduciary

obligations toward Plaintiff and the other members of the Class.

107. As a result of the actions of the Individual Defendants, Plaintiff and the Class will

suffer irreparable injury in that they have not and will not receive their fair portion of the value

of Alberto-Culver’s assets and businesses and have been and will be prevented from obtaining a

fair price for their common stock.

108. Unless enjoined by this Court, the Individual Defendants will continue to breach

their fiduciary duties owed to Plaintiff and the Class, and may consummate the Proposed

Transaction which will exclude the Class from its fair share of Alberto-Culver’s valuable assets

and businesses, and/or benefit them in the unfair manner complained of herein, all to the

irreparable harm of the Class, as aforesaid.

109. The Individual Defendants are engaging in self-dealing, are not acting in good

faith toward Plaintiff and the other members of the Class, and have breached and are breaching

their fiduciary duties to the members of the Class.

110. Plaintiff and the members of the Class have no adequate remedy at law. Only

through the exercise of this Court’s equitable powers can Plaintiff and the Class be fully

protected from the immediate and irreparable injury, which defendants’ actions threaten to

inflict.

34


COUNT IV

On behalf of Plaintiff and the Class for Aiding and Abetting the Individual Defendants(Against Unilever and Alberto-Culver)



112. Unilever and Alberto-Culver have knowingly aided and abetted the Individual

Defendants’ wrongdoing alleged herein. Unilever is also an active and necessary participant in

the Individual Defendants’ plan to complete the Proposed Transaction on terms that unfair to

Alberto-Culver shareholders, as Unilever seeks to pay as little as possible to Alberto-Culver

shareholders.

113. Plaintiff has no adequate remedy at l aw.

PRAYER FOR RELIEF

WHEREFORE, Plaintiff demands judgment and preliminary and permanent relief,

including injunctive relief, in their favor and in favor of the Class, and against the defendants as

follows:

A. Declaring this action to be a proper class action and certifying Plaintiff as class

representatives and Plaintiff’s counsel as class counsel;

B. Declaring that the Proxy is materially false and/or misleading and contains

omissions of material fact in violation of Section 20(a) and 14(a) of the Exchange Act and Rule

14a-9 promulgated thereunder;

C. Preliminarily and permanently enjoining defendants from disenfranchising the

Class and effectuating the Proposed Transaction;

D. Declaring that the Individual Defendants have breached their fiduciary duty to

Plaintiff and the Class;

E. Awarding fees, expenses and costs to Plaintiff and Plaintiff’s counsel; and

35


F. Granting such other and further relief as the Court deems just and proper.

Dated: November 8, 2010 Respectfully submitted,

BELONGIA, SHAPIRO & FRANKLIN, LLP

s/ Harry O. ChannonMark D. BelongiaHarry O. ChannonAtty. No.: 4708920 S. Clark Street, Suite 300Chicago, Illinois 60603Tel .: 312.662.1030Fax: 312.662.1040

FARUQI & FARUQI, LLPNadeem FaruqiDavid H. LeventhalJuan E. Monteverde369 Lexington Avenue, 10th FloorNew York, New York 10017Tel .: 212.983.9330Fax: 212.983.9331

GARDY & NOTIS, LLPJames S. NotisCharles A. Germershausen560 Sylvan AvenueEnglewood Cliffs, New Jersey 07632Tel.: 201.567.7377Fax: 201.567.7337

Attorneys for Plaintiff Dolores Joyce

36

Documents

Case: 1:10-cv-07212 Document #: 1 Filed: 11/08/10 Page 2