As filed with the Securities and Exchange Commission on June 30, 2000
Registration No. 333-_____
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Form S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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IMPAX LABORATORIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 65-0403311
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
30831 Huntwood Avenue
Hayward, CA 945444
(510) 471-3600
(Address, including zip code, and telephone number, including area code,
of principal executive offices)
BARRY R. EDWARDS
Co-Chief Executive Officer
IMPAX LABORATORIES, INC.
3735 Castor Avenue
Philadelphia, PA 19124
215-289-2220
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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Copies of all communications, including all communications sent to the
agent for service, should be sent to:
SOL GENAUER, ESQ.
Blank Rome Comisky & McCauley LLP
One Logan Square
Philadelphia, PA 19103-6998
(215) 569-5500
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Approximate date of proposed sale to the public: From time to time after
the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. |_|
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended, other than securities offered only in connection with dividend
or interest reinvestment plans, check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. |_|
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_|
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|
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<PAGE>
Calculation of Registration Fee
<TABLE>
<CAPTION>
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Proposed maximum Proposed maximum
Title of shares Amount offering price per aggregate offering Amount of
to be registered To be registered unit price Registration fee
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<S> <C> <C> <C> <C>
Common Stock, $.01
par value per share. . . . 14,703,979 $6.25 (1) $91,899,868.75 $24,261.57
======================================================================================================================
</TABLE>
(1) Estimated in accordance with Rule 457(c) under the Securities Act of
1933, as amended, solely for the purpose of calculating the
registration fee, based upon the average of the high and low prices per
share of Common Stock on the NASDAQ Small Cap market on June 28, 2000.
Of the shares of Common Stock being registered 11,341,657 shares are
issuable upon conversion of an aggregate of 170,000 shares of Series
1-B Convertible Preferred Stock, 3,000,000 shares issuable upon
conversion of 150,000 shares of Series 2 Convertible Preferred Stock of
the Registrant, and 362,322 shares are issuable upon exercise of
warrants to purchase Common Stock.
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The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
PROSPECTUS
IMPAX LABORATORIES, INC.
14,703,979 Shares
Common Stock
These 14,703,979 shares of our common stock are being offered for sale
by the selling stockholders named on page 12 of this prospectus. We
will not receive any part of the proceeds from these sales.
Our common stock trades on the Nasdaq SmallCap Market under the symbol
"IPXL." On June 29, 2000, the closing sale price of our common stock
was $6.125 per share.
Our principal executive officers are located at Impax Laboratories,
Inc., 30831 Huntwood Avenue, Hayward, California, 94544 and our
telephone number is (510) 471-3600.
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You are urged to carefully read the "Risk Factors" section beginning on
page 1 of this Prospectus, which describes specific risks and certain other
information associated with an investment in our company that should be
considered before you make your investment decision.
------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy of this Prospectus. Any representation to the contrary is a criminal
offense.
The date of this Prospectus is June 30, 2000
<PAGE>
TABLE OF CONTENTS
Page
Risk Factors ...........................................................1
Where You Can Find More Information ....................................10
Use of Proceeds ........................................................11
Selling Stockholders ...................................................11
Plan of Distribution ...................................................13
Legal Matters ..........................................................14
Experts ................................................................15
i
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RISK FACTORS
An investment in our common stock involves a high degree of risk. You
should consider carefully the following risk factors, as well as the other
information included in this prospectus, in deciding whether to invest in our
common stock. This prospectus contains forward-looking statements that involve
risks and uncertainties. Our actual results could differ materially from the
results discussed in the forward-looking statements. Factors that could cause or
contribute to these differences include, but are not limited to, those discussed
in this "Risk Factors" section, and elsewhere in this prospectus.
If we are unable to obtain additional financing, our limited supply of funds may
require us to modify our business operations and plans by spending less money on
research and development programs, developing fewer products and filing fewer
drug applications with the Food and Drug Administration ("FDA").
As of March 31, 2000, we had approximately $20 million of unrestricted
funds. We estimate that these funds will be sufficient for the next nine months
of operations at our planned expenditure levels. The exact amount and timing of
future capital requirements will depend upon many factors, including continued
progress with our research and development programs, expansion of such programs
and, ultimately, the approval and launch of our products. We may not be
successful in obtaining additional capital in amounts sufficient to fund our
operations. Additional financing also may not be available to us on terms
favorable to us or our stockholders, or at all. In the event that adequate funds
are not available, our business operations and plans may need to be modified.
This could result in less money being spent on research and development
programs, fewer products being developed and at a slower pace, and fewer drug
applications being filed with the FDA.
Our limited capital may make it difficult for us to repay our outstanding
indebtedness.
We may not be able to maintain adequate capital at any given time or from
time to time in the future. As of March 31, 2000, we had outstanding
approximately $3,950,000 of indebtedness, bearing interest at rates ranging from
2% to 9.5% annually. Of this indebtedness, $2,030,000 is owed to General
Electric Credit Corporation under our revolving credit facility. The facility
expires in July 2001. Additionally, as of March 31, 2000, we had a stockholders'
accumulated deficit of approximately $24,622,000.
Our stockholders may sustain dilution in ownership or be adversely affected by
strategic alliance or licensing arrangements we make with other companies.
We need to raise additional capital in the future to fund our planned
expansion. To the extent we raise additional capital by issuing equity
securities, ownership dilution to our stockholders will result. To the extent we
raise additional funds through strategic alliance and licensing arrangements, we
may be required to relinquish rights to certain of our technologies or product
candidates, or to grant licenses on terms that are not favorable to us, either
of which could reduce our value.
The time necessary to develop generic drugs may adversely affect when and the
rate at which we receive a return on our capital.
We begin our development activities for a new generic drug product several
years in advance of the patent expiration date of the brand name drug
equivalent. The development process, including drug formulation, testing and FDA
approval generally takes three or more years. This process requires that we
expend considerable capital to activities that do not yield an immediate or
near-term return. Also, because of the significant time necessary to develop a
product, the actual market for a product at the time
<PAGE>
it is available for sale may be significantly less than the originally projected
market for the product. Our return on investment to develop the product will
then be adversely affected.
We may fail to realize the anticipated benefits of our recently completed merger
which combined Impax Pharmaceuticals, Inc. with Global Pharmaceuticals, Inc. to
create Impax Laboratories, Inc.
We believe that an important benefit from the merger is our ability to
utilize the strongest elements of the management, strategy, and operations of
each of the two companies which combined. It is possible that we may not be able
to successfully integrate their operations without encountering difficulties or
losing key personnel, and the benefits that we expect from this merger may not
be realized. The combined results of operations and financial condition of the
combined company may be inferior to those which may have been achieved by each
company independently.
We have experienced and continue to experience operating losses, and the highly
regulated nature of our business makes our future profitability uncertain.
We do not know whether or when our business will ever be profitable. We
have generated minimal revenues to date and have experienced operating losses
since our inception. As of March 31, 2000, our accumulated deficit was
$24,622,000 and we had outstanding indebtedness in an aggregate principal amount
of $3,950,000. To remain operational, we must:
o Properly receive, warehouse and store raw materials and supplies;
o Maintain work in progress in compliance with regulatory requirements
and properly store finished goods;
o Properly manufacture various formulations, dosages and configurations
of a potentially broad product line;
o Meet strict security requirements for virtually every activity
undertaken at the plant;
o Maintain appropriate laboratory, quality control and quality assurance
practices and procedures; and
o Comply with the many complex governmental regulations that deal with
virtually every aspect of our proposed business activities.
Operating our business successfully also will depend, in part, on a
variety of factors outside of our control, including:
o Changes in raw material supplies and suppliers;
o Changes in governmental programs and requirements;
o Changes in physician or consumer preferences; and
o Changes in FDA and similar regulatory requirements.
2
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Our revenues and profitability have fluctuated and could fluctuate significantly
in the future, which may have a material adverse effect on our results of
operations and stock price.
Our revenues and profitability may vary significantly from fiscal quarter
to fiscal quarter as well as in comparison to the corresponding fiscal quarter
of the preceding year. Variations of those types may result from, among other
factors:
o The timing of FDA reapprovals we receive;
o The timing of process validation for particular generic drug products;
o The timing of any significant initial shipments of newly approved
drugs; and
o Competition from other generic drug manufacturers that receive FDA
approvals for competing products.
We cannot predict whether our business will be seasonal in nature. Products
that we manufacture and distribute pertaining to seasonal ailments such as
allergies or colds may experience seasonal patterns in sales and profitability.
The potential seasonality of our business may have a material adverse effect on
our results of operations and stock price.
Restrictive FDA regulations govern the manufacturing and distribution of our
products.
The FDA also regulates the development, manufacture, distribution, labeling
and promotion of prescription drugs, requires that certain records be kept and
reports be made, mandates registration of drug manufacturers and listing of
their products and has the authority to inspect manufacturing facilities for
compliance with Current Good Manufacturing Practices or cGMP, standards. Our
business and financial results could be materially harmed by any failure to
comply with licensing and other requirements.
Other requirements exist for controlled drugs, such as narcotics, which are
regulated by the U.S. Drug Enforcement Administration or DEA. Further, the FDA
has the authority to withdraw approvals of previously approved drugs for cause,
to request recalls of products, to bar companies and individuals from future
drug application submissions and, through action in court, to seize products,
institute criminal prosecution or close manufacturing plants in response to
violations. The DEA has similar authority and may also pursue monetary
penalties. Our business and financial results could be materially harmed by
these requirements or FDA or DEA actions.
The FDA may not approve our future products, in which case our ability to
generate product revenues will be adversely affected.
The testing, manufacturing and marketing of our products generally are
subject to extensive regulation and approvals by numerous government authorities
in the United States and other countries. We may not receive FDA approvals for
additional products on a timely basis, or at all. Any delay in our obtaining or
any failure to obtain these approvals would adversely affect our ability to
generate product revenue. Also, the process of seeking FDA approvals can be
costly, time consuming, and subject to unanticipated and significant delays.
3
<PAGE>
We are subject to an outstanding court order governing manufacture of our
products which may adversely affect our product introduction plans and results
of operations.
On May 25, 1993, the United States District Court for the Eastern District
of Pennsylvania issued an order against Richlyn Laboratories, Inc. that, among
other things, permanently enjoined Richlyn from selling any drug manufactured,
processed, packed or labeled at its Philadelphia facility unless it met certain
stipulated conditions. When we acquired the facilities and drug applications of
Richlyn, we became subject to the conditions in that court order. The order
requires, in part, that FDA find that products manufactured, processed and
packed at the former Richlyn facility conform with FDA regulations concerning
current Good Manufacturing Practices before the products can be marketed.
Although we were informed in January 1998 that product by product
inspection and prior authorization was no longer required in order for us to
manufacture and sell products, we cannot give any assurance that the FDA will
not reverse or reconsider its position and again require product by product
inspection and prior authorization. Requiring such inspection and authorization
would subject us to a higher level of scrutiny then is standard for the generic
pharmaceutical manufacturing industry. Any reversal or reconsideration by FDA
will delay product introduction plans.
The order against Richlyn also requires that we hire and retrain a person,
subject to FDA approval, who is qualified to inspect our drug manufacturing
facilities to determine that our methods, facilities and controls are operated
and administered in compliance with current Good Manufacturing Practices. This
person must examine all drug products manufactured, processed, packed and held
at our facility and certify in writing to the FDA our compliance with related
current good manufacturing practices. We have contracted with a local consultant
to conduct this compliance review. In addition to the cost and expense of this
examination, we may not be able to maintain compliance with current good
manufacturing practices, which would severely restrict our operations.
We depend on our patents and trade secrets and our future success is dependent
on our ability to protect these secrets and not infringe on the rights of
others.
We believe that patent and trade secret protection is important to our
business and that our future success will depend in part on our ability to
obtain patents, maintain trade secret protection and operate without infringing
on the rights of others. We have been issued a number of U.S. patents and have
filed additional U.S. and various foreign patent applications relating to our
drug delivery technologies. We expect to apply for additional U.S. and foreign
patents in the future. The issuance of a patent is not conclusive as to its
validity or as to the enforceable scope of the claims of the patent. We cannot
assure you that:
o our patents or any future patents will prevent other companies from
developing similar or functionally equivalent products or from
successfully challenging the validity of our patents;
o any of our future processes or products will be patentable;
o any pending or additional patents will be issued in any or all
appropriate jurisdictions;
o our processes or products will not infringe upon the patents of third
parties; or
o we will have the resources to defend against charges of patent
infringement by third parties or to protect our own patent rights
against infringement by third parties.
Our business and financial results could be materially harmed if we fail to
avoid infringement of the patent or proprietary rights of others or to protect
our patent rights.
4
<PAGE>
We may have exposure to patent infringement litigation as a result of our
product development efforts, which could adversely affect our product
introduction efforts and be costly.
The patent position of pharmaceutical firms involves many complex legal and
technical issues and has recently been the subject of much litigation. There is
no clear policy establishing the breadth of claims allowed or the degree of
protection afforded under these patents. During the past several years, there is
an increasing tendency for the innovator of the original patented product to
bring patent litigation against a generic drug company. This litigation is often
initiated as an attempt to delay the entry of the generic drug product and
reduce its market penetration.
As of March 31, 2000, we have submitted five filings for new generic drug
applications with the FDA, and expect to submit additional applications.
Consequently, it is possible that we could become subject to patent infringement
claims or litigation as a result of our product development. If a patent
infringement claim is asserted, we may incur substantial legal fees in defending
ourself. Any such claim or litigation will likely defer the FDA approval and
marketing of the product and could result in a complete barrier to that
product's entry into the market. As of March 31, 2000, we have purchased $5
million of patent infringement liability insurance coverage under the
Hatch-Waxman Act provisions relating to Paragraph IV Certification. There can be
no assurance that the insurance coverage will be sufficient to cover any
liability resulting from alleged or proven patent infringement.
Pharmaceutical drug makers face an inherent risk of product liability litigation
and any claims brought against us could have a material adverse effect upon us.
The design, development and manufacture of our products involve an inherent
risk of product liability claims and associated adverse publicity. Insurance
coverage is expensive, difficult to obtain and may not be available in the
future on acceptable terms or at all. Any claims brought against us, whether
fully covered by insurance or not, could have a material adverse effect upon us.
We may face liability resulting from a patent infringement lawsuit against us by
AstraZeneca PLC.
AstraZeneca PLC has recently announced a patent infringement lawsuit
against us as a result of an Abbreviated New Drug Application ("ANDA") that we
filed with the FDA for a generic version of Prilosec (Omeprazole Delayed-release
Capsules). In the ANDA, we are not challenging the basic Omeprazole patent that
expires in 2001; rather we have asserted that our specific formulation does not
infringe other patents listed by AstraZeneca PLC in connection with Prilosec.
There can be no assurance that we will be successful in our defense of the
patent infringement claim. If AstraZeneca PLC is successful in its lawsuit, any
resulting liability could have a material adverse effect on us.
We have exposure under DES-related product liability claims, which could have a
material adverse effect upon our financial condition.
When we acquired the business of Richlyn, we also assumed its liabilities
in connection with Diethyl Stilbestrol, commonly known as DES, which was
manufactured by Richlyn and many other drug manufacturers during the late 1950's
and early 1960's. DES was prescribed to pregnant women during that period and
has been alleged to cause birth defects, in particular an increased risk of
uterine cancer and sterility of female children whose mothers took the drug
during their pregnancy. There have been numerous claims brought against drug
manufacturers relating to DES and, since 1987, Richlyn's insurers have paid
approximately $136,000 on their behalf and our behalf to settle approximately
143 DES-related suits. No other legal actions have been brought or, to our
knowledge, threatened against Richlyn or us in connection with DES-related
claims. We do not expect to be held liable for DES-related claims other than
claims based on products manufactured by Richlyn. Claims settlements to date
have been based on
5
<PAGE>
market share and we believe Richlyn's share of the DES market during the
relevant periods was substantially less than 1%.
Our compliance with environmental laws may necessitate uncertain expenditures in
the future, the capital for which may not be available to us.
We cannot accurately predict the outcome or timing of future expenditures
that we may be required to pay in order to comply with comprehensive federal,
state and local environmental laws and regulations. We must comply with
environmental laws which govern, among other things, all emissions, waste water
discharge and solid and hazardous waste disposal, and the remediation of
contamination associated with generation, handling and disposal activities. We
are subject periodically to environmental compliance reviews by various
regulatory offices. Environmental laws have changed in recent years and we may
become subject to stricter environmental standards in the future and face larger
capital expenditures in order to comply with environmental laws. Our limited
capital makes it uncertain whether we will be able to pay for these larger than
expected capital expenditures. Also, future developments, administrative actions
or liabilities relating to environmental matters may have a material adverse
effect on our financial condition or results of operations.
The high level of competition we face in the generic drug industry from
competitors who often have greater resources than us could adversely affect our
profitability.
The generic drug industry is highly competitive. Our competitors are both
generic drug manufacturers and brand name drug companies. Many of our
competitors have greater financial and other resources than us, and can spend
significantly more than we can in research, marketing and product development.
Relatively large research and development expenditures enable a company to
support many FDA applications simultaneously. This improves the likelihood that
these greater resourced companies will be among the first to obtain approval of
at least some generic drugs. In addition, the generic drug industry is currently
undergoing a consolidation which may exacerbate this situation.
Generic drug makers are most profitable when they are the first producer of a
generic drug, and we do not know if we will be the first maker of any generic
drug product.
The first generic drug manufacturers receiving FDA approval for generic
equivalents of related brand name products have historically captured
significant market share enabling it to extract greater profits from the branded
product than later arriving manufacturers. The development of a new generic drug
product, including its formulation, testing and FDA approval, generally takes
approximately three or more years. Consequently, we may select drugs for
development several years in advance of their anticipated entry to market, and
cannot know what the market or level of competition will be for that particular
product when we begin selling the product. Our profitability, if any, will
depend, in part on:
o Our ability to develop and rapidly introduce new products:
o The timing of FDA approvals of our products; and
o The number and timing of FDA approvals for competing products.
In addition, by introducing generic versions of their own branded products
prior to the expiration of the patents for those drugs, brand name drug
companies have attempted to prevent generic drug manufacturers from producing
certain products. Brand name companies have also attempted to prevent competing
generic drug products from being treated as equivalent to their brand name
products. We expect efforts of this type to continue.
6
<PAGE>
We are dependent on a small number of products to generate revenues to fund our
business and operations.
Our long-term success is dependent, among other factors, on our ability to
offer and sell a broad line of products. We intend to introduce products on a
selected basis. Consequently, we will be dependent, particularly in the
near-term, upon a relatively small number of products to generate revenues. As a
result, if we misjudge the market for or are delayed in the production of a
particular product, our business can be materially adversely affected.
We are dependent on a small number of suppliers for our raw materials, and any
delay or unavailability of raw materials can materially adversely affect our
ability to produce products.
The FDA requires specification of raw material suppliers in applications
for approval of drug products. If raw materials were unavailable from a
specified supplier, FDA approval of a new supplier could delay the manufacture
of the drug involved. In addition, some materials used in our products are
currently available from only one or a limited number of suppliers. Further, a
significant portion of our raw materials may be available only from foreign
sources. Foreign sources can be subject to the special risks of doing business
abroad, including:
o Greater possibility for disruption due to transportation or
communication problems;
o The relative instability of foreign governments and economies;
o Interim price volatility based on labor unrest or materials or
equipment shortages; and
o Uncertainty regarding recourse to a dependable legal system for the
enforcement of contracts and other rights.
The delay or unavailability of raw materials can materially adversely
affect our ability to produce products. This can materially adversely affect our
business and operations.
If certain holders of our equity exercise their rights to acquire shares of
common stock, it may lower the future value of the common stock.
At March 31, 2000, there were a total of 220,000 shares outstanding of our
Series 1 Preferred Stock and 150,000 shares of our Series 2 Preferred Stock. At
March 31, 2000, these shares were convertible, at any time at the option of
their holders, into an aggregate of 16,841,657 shares of our common stock. The
shares of preferred stock also have anti-dilution protections if we were to
issue stock for a price below stated levels, which could make them convertible
into additional shares of common stock.
At March 31, 2000, there were outstanding warrants and options to purchase
an aggregate of 6,193,658 shares of our common stock at exercise prices ranging
from $0.75 to $13.175 per share of common stock. In addition, under our
arrangement with Merck KGaA, a German company, Global issued warrants which are
exercisable for 40,000 shares of common stock for each aggregate $1 million in
gross profit, if any, earned by us under an agreement with a subsidiary of Merck
KGaA (up to a total of 700,000 shares of common stock). The exercise price for
these warrants and options may be at prices below the then trading market price
for our common stock. Consequently, any exercise of these options or warrants
could dilute the future value of our common stock.
7
<PAGE>
We have and may in the future issue additional preferred stock which could
adversely affect the rights of holders of our common stock.
Our Board of Directors has the authority to issue up to 2,000,000 shares of
our preferred stock and to determine the price, rights, preferences and
privileges of those shares without any further vote or action by the
stockholders (except that the rights, preferences and privileges may not be more
favorable to the stockholder than the Series 1 Preferred Stock and Series 2
Preferred Stock, without the approval of holders of the Series 1 Preferred Stock
and Series 2 Preferred Stock). We presently have outstanding 50,000 shares of
Series 1-A Preferred Stock, 170,000 shares of Series 1-B Preferred Stock, and
150,000 shares of Series 2 Preferred Stock. Preferred stockholders could
adversely affect the rights of holders of common stock by:
o Exercising voting, redemption and conversion rights to the detriment
of the holders of common stock;
o Receiving preferences over the holders of common stock regarding
assets or surplus funds in the event of our dissolution or
liquidation;
o Delaying, deferring or preventing a change in control of our company;
o Discouraging bids for our common stock at a premium over the market
price of the common stock; and
o Otherwise adversely affecting the market price of the common stock.
In this regard, you should also review the "Control of our company is
concentrated among a limited number of stockholders, who can exercise
significant influence over all matters requiring stockholder approval" risk
factor later in this Section.
Control of our company is concentrated among a limited number of stockholders,
who can exercise significant influence over all matters requiring stockholder
approval.
As of March 31, 2000, our present directors, executive officers and their
respective affiliates and related entities beneficially owned approximately 53%
of our common stock and common stock equivalents. These stockholders can
exercise significant influence over all matters requiring stockholder approval,
including the election of directors and the approval of significant corporate
transactions. This concentration of ownership may also potentially delay or
prevent a change in control of our company. In this regard, you should also
review the "Rights of certain holders of our equity to acquire shares of common
stock may dilute the future value of the common stock" and "We have and may in
the future issue additional preferred stock which could adversely affect the
rights of holders of our common stock" risk factors in other parts of this
Section, and the "Selling Stockholders" Section later in this Prospectus. In
addition, holders of approximately 64% of our outstanding voting stock have
entered into an agreement committing them to vote their shares of stock until
December 14, 2002 for the election as directors of the individuals designated
each year by the former boards of Global Pharmaceuticals, Inc. ("Global") and
Impax Pharmaceuticals, Inc. ("Impax") prior to our merger.
We depend on key officers and qualified scientific and technical employees and
our limited resources may make it more difficult to attract and retain these
personnel.
As a small company with, as of March 31, 2000, only approximately 128
employees, the success of our present and future operations will depend to a
great extent on the collective experience, abilities and continued service of
certain of our executive officers. If we lose the services of any of these
8
<PAGE>
executive officers, it could have a material adverse effect on us. Because of
the specialized scientific nature of our business, we are also highly dependent
upon our ability to continue to attract and retain qualified scientific and
technical personnel. Loss of the services of, or failure to recruit, key
scientific and technical personnel would be significantly detrimental to our
product development programs. Our small size and limited resources may make it
more difficult for us to attract and retain our executive officers and qualified
scientific and technical personnel.
We have limited manufacturing capacity and need to acquire or build additional
capacity for products in our pipeline. Our manufacturing facilities must comply
with stringent FDA and other regulatory requirements.
We have an approximately 113,000 square foot commercial manufacturing
facility. This facility is currently being used to manufacture 20 of our
currently marketed products. Although this facility is expected to be sufficient
for these products, it will not be suitable for the manufacture of all of the
products we intend to develop and manufacture. We will need to scale up our
current manufacturing operations significantly. We are in the process of
expanding our facilities for manufacturing operations.
In addition to obtaining the appropriate licenses and permits to build the
new facilities, the new manufacturing facilities, once completed, will need to
be in compliance with cGMP and inspected. We cannot assure you that such
permits, licenses and approvals will be obtained or, if obtained, obtained in
time to manufacture additional products as they are approved. Our facilities
will be subject to periodic inspections by the FDA and we cannot assure you that
the facilities will continue to be in compliance with cGMP or other regulatory
requirements. Failure to comply with such requirements could result in
significant delays in the development, approval and distribution of our planned
products, and may require us to incur significant additional expense to comply
with cGMP or other regulatory requirements. We cannot assure you that we will be
able to manufacture our products successfully on a commercial scale. Further, we
will depend on other companies to manufacture certain of the product candidates
under development.
The DEA also periodically inspects facilities for compliance with security,
recordkeeping, and other requirements that govern controlled substances. We
cannot assure you that we will be in compliance with DEA requirements in the
future.
If we are unable to manage our rapid growth, our business will suffer.
We have experienced rapid growth of our operations. This growth has
required us to expand, upgrade and improve our administrative, operational and
management systems, controls and resources. We anticipate additional growth in
connection with the expansion of our manufacturing operations, development of
our brand products, our marketing and sales efforts for the products we develop,
the development and manufacturing efforts for our products and Internet
operations. If we fail to manage growth effectively or to develop a successful
marketing approach, our business and financial results will be materially
harmed.
We face intense competition in the pharmaceutical industry from both brand-name
and bioequivalent manufacturers, wholesalers and distributors that could
severely limit our growth.
The pharmaceutical industry is highly competitive and many of our
competitors have longer operating histories and greater financial, research and
development, marketing and other resources than us. We are subject to
competition from numerous other entities that currently operate or intend to
operate in the pharmaceutical industry, including companies that are engaged in
the development of controlled-release drug delivery technologies and products
and other manufacturers that may decide to undertake in-house development of
these products. Our bioequivalent products may be subject to competition from
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<PAGE>
competing bioequivalent products marketed by the patent holder. In our
pharmaceutical distribution business, we compete with a number of large
wholesalers and other distributors of pharmaceuticals. We cannot assure you that
we will be able to continue to compete successfully with these companies.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the Securities and Exchange Commission. You may inspect and
copy any document we file at the SEC's Public Reference Room at 450 Fifth
Street, N.W., Washington, D.C. 20549 or at the SEC's other public reference
facilities in New York, New York, or Chicago, Illinois. Please call the SEC at
1-800-SEC-0330 for further information on the public reference rooms. Our SEC
filings are also available to the public from the SEC's web site on the Internet
at http://www.sec.gov. This web site contains reports, proxy and information
statements and other information regarding our company and other registrants
that file electronically with the SEC.
We have filed a registration statement on Form S-3 with the SEC covering
the shares of common stock being offered by means of this prospectus. We are
allowed to "incorporate by reference" the information contained in documents we
file with the SEC, which means that we can disclose important information to you
by referring you to those documents. The information incorporated by reference
is considered to be part of this prospectus, and later information that we file
with the SEC will automatically update and supersede this information. We
incorporate by reference the documents listed below, and any future filings made
with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange
Act of 1934, until the selling stockholders sell all the shares:
1. Our annual report on Form 10-KSB for the year ended December 31, 1999;
2. Our quarterly report on Form 10-QSB for the quarter ended March 31,
2000;
3. Our current report on Form 8-K filed on May 16, 2000; and
4. The description of our common stock contained in our registration
statement on Form 8-A filed on December 8, 1995, as amended on
December 14, 1997.
You may request a copy of these filings, at no cost, by writing or
telephoning our Secretary at Impax Laboratories, Inc., 30831 Huntwood Avenue,
Hayward, California 94544, telephone number (510) 471-3600.
You should rely on the information incorporated by reference or provided in
this prospectus or any supplement. We have not authorized anyone else to provide
you with different information. The selling stockholders will not make an offer
of these shares in any state where the offer is not permitted. You should not
assume that the information in this prospectus or any supplement is accurate as
of any date other than the date on the front of those documents.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
In this prospectus, we have made forward-looking statements relating to the
future results of our company. These statements are based on our estimates and
assumptions and are subject to a number of risks and uncertainties.
Forward-looking statements are preceded or followed by the words "anticipates,"
"believes," "estimates," "expects," "hopes," "targets" or similar expressions.
Our future results could be affected by subsequent events and could differ
materially from those expressed in the forward-looking statements. If further
events and actual performance differ from our
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<PAGE>
assumption, actual results could vary significantly from the performance
projected in the forward-looking statements.
The following important factors, along with those discussed elsewhere in
this prospectus, could affect our future results and could cause those results
to differ materially from those expressed in the forward-looking statements:
o our ability to combine operations and obtain revenue enhancements and
cost savings following the recently completed merger of Impax
Pharmaceuticals, Inc. and Global Pharmaceutical Corporation (which
formed our company under our new name, Impax Laboratories, Inc.);
o material adverse changes in economic conditions in the markets served
by our company;
o material changes in available technology; and
o the extent, success and overall effects of competition from others in
the pharmaceutical markets.
USE OF PROCEEDS
We will not receive any proceeds from the sale of the shares of our common
stock by the selling stockholders.
SELLING STOCKHOLDERS
The table below sets forth information as of March 31, 2000 with respect to
the number and percentage of shares of common stock beneficially owned by each
of the selling stockholders and the number of shares being offered for sale by
each selling stockholder.
The selling stockholders, in the aggregate, are offering for sale up to
14,703,979 shares of our common stock. Of these shares, 14,341,657 shares of
common stock can be acquired by certain selling stockholders upon their
conversion of an aggregate of 170,000 shares of our Series 1-B Preferred Stock
owned by them, into an aggregate of 11,341,657 shares of our common stock, and
an aggregate of 150,000 shares of our Series 2 Preferred Stock owned by them,
into an aggregate of 3,000,000 shares of our common stock. These numbers remain
subject to certain antidilution provisions applicable to the Series 1-B and 2
Preferred Stock. The selling stockholders acquired the shares of Series 1-B
Preferred Stock, on December 14, 1999 as a result of the merger of Global
Pharmaceutical Corporation and Impax Pharmaceuticals, Inc. The selling
stockholders acquired the 150,000 shares of Series 2 Preferred Stock from us on
March 23, 2000 for a $100 per share purchase price which resulted in an
aggregate purchase price of $15 million.
The remaining 362,322 shares of common stock being offered by certain of
the selling stockholders are being offered by former directors of either Global
Pharmaceutical Corporation or Impax Pharmaceuticals, Inc. These shares of common
stock can be acquired upon the exercise of common stock warrants, which,
pursuant to the merger agreement, were issued to these former directors in
exchange for their then existing Global Pharmaceutical Corporation or Impax
Pharmaceuticals, Inc. common stock options.
11
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<TABLE>
<CAPTION>
Shares of Common Shares of Common
Stock Beneficially Number of Stock Beneficially
Owned Before this Shares Being Owned After this
Selling Stockholder Offering Offered Offering
----------------------------------------- ------------------------ -------------- ----------------------
Number(1) Percent Number Percent
---------- ------- --------- -------
<S> <C> <C> <C> <C> <C>
Chemical Company of Malaysia Berhad...... 5,741,154 20.8 2,868,623 2,872,531 10.5
China Development Industrial Bank, Inc... 4,269,357 20.0 4,269,357 0 0
Euroc II Venture Capital Corp............ 266,864 1.1 266,864 0 0
Euroc III Venture Capital Corp........... 533,728 2.1 533,728 0 0
Fleming US Discovery Fund III, L.P....... 3,986,452 13.5 1,292,740 2,693,712 9.5
Fleming US Discovery Offshore Fund III, L.P. 638,548 2.1 207,260 431,288 1.5
Multiventure Technologies, Inc........... 200,148 * 200,148 0 0
President (BVI) International Investment
Holdings, Ltd.......................... 4,269,357 14.7 4,269,357 0 0
Tai-I Electric Wire & Cable Co., Ltd..... 333,580 1.3 333,580 0 0
Robert L. Burr(2)........................ 5,000 * 5,000 0 0
Philip L. Chapman(3)..................... 655,350 2.7 30,000 625,350 2.5
Gary Escandon(4)......................... 153,227 * 30,000 123,227 *
Charles Hsiao(5)......................... 4,942,974 18.7 100,000 4,842,974 18.4
George F. Keane.......................... 73,000 * 65,000 8,000 *
Max L. Mendelson......................... 222,916 * 130,650 92,266 *
John W. Rowe, M.D........................ 65,000 * 65,000 0 0
Soo Bin Tan.............................. 202,149 * 6,672 195,477 *
Udi Toledano(6).......................... 270,925 1.1 30,000 240,925 *
</TABLE>
-----------------
* less than 1%
(1) The number of shares beneficially owned includes shares issuable upon
conversion of Series 1 Preferred Stock, Series 2 Preferred Stock and shares
issuable within 60 days upon exercise of outstanding warrants and options.
(2) Does not include shares beneficially owned by Fleming US Discovery
Fund III, L.P. and Fleming US Discovery Offshore Fund III, L.P. Mr. Burr
is a director of Fleming Asset Management, a division of Robert Fleming,
Inc.
(3) Includes 50,000 shares of common stock owned by a limited partnership of
which Mr. Chapman's wife is the sole general partner and 575,350 shares of
common stock held by the Frederick R. Adler Intangible Asset Management
Trust, of which Mr. Chapman's wife serves as trustee, all of which shares
Mr. Chapman disclaims beneficial ownership.
(4) Includes 7,500 shares of common stock owned by the Alvaro P. Escandon Inc.
Money Purchase Pension Plan dated 12/1/80, with respect to which
Mr. Escandon disclaims beneficial ownership.
(5) Includes 500,370 shares of common stock held in trust for the benefit of
John Hsiao's children and 250,185 shares of common stock held in trust for
the benefit of Richard Hsiao's children. Does not include 2,601,924 shares
of common stock held in the Chiin Hsiao Children Irrevocable Trust, as to
which shares Dr. Hsiao does not have voting or dispositive power.
(6) Includes 68,568 shares of common stock owned by Mr. Toledano's wife and
22,529 shares of common stock owned by a trust for the benefit of minor
children of Mr. Toledano, all of which shares Mr. Toledano disclaims
beneficial ownership.
During the three years prior to the date of this prospectus, each of the
selling stockholders other than Euroc II Venture Capital Corp., Euroc III
Venture Capital Corp., Multiventure Technologies, Inc. and Tai-I Electric
Wire and Cable Co., Ltd. served or had an individual affiliated with them
serve as a director of either of the two companies which merged to form our
company. Max L. Mendelsohn
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<PAGE>
also served as Chairman of Global Pharmaceutical Corporation from August
1998 to December 1999, and as its President and Chief Executive Officer
from 1995 to 1998. In addition, pursuant to rights granted to them as
holders of Series 1 Preferred Stock, Chemical Company of Malaysia Berhad,
China Development Industrial Bank, Inc., Fleming US Discovery Fund III,
L.P., Fleming US Discovery Offshore Fund III, L.P., and President (BVI)
International Investment Holdings, Ltd. have designated an individual who
is serving as a director of our company as of the date of this prospectus.
PLAN OF DISTRIBUTION
We are registering the shares of common stock on behalf of the selling
stockholders. We will pay all costs, expenses and fees in connection with this
registration, except that the selling stockholders will pay underwriting
discounts and selling commissions, if any. We will not receive any of the
proceeds from the sale of the shares by the selling stockholders. When we refer
to the "selling stockholders" in this prospectus, that term includes donees and
pledgees selling shares of common stock under this prospectus which were
received from the selling stockholders.
The selling stockholders may sell their shares at various times in one
or more of the following transactions:
o on the Nasdaq SmallCap Market (or any other exchange on which the
shares may be listed);
o in the over-the-counter market;
o in negotiated transactions other than on such exchange;
o by pledge to secure debts and other obligations;
o in connection with the writing of non-traded and exchange-traded call
options, in hedge transactions, in covering previously established
short positions and in settlement of other transactions in
standardized or over-the-counter options; or
o in a combination of any of the above transactions.
The selling stockholders may sell their shares at market prices prevailing
at the time of sale, at prices related to such prevailing market prices, at
negotiated prices or at fixed prices. The selling stockholders may sell shares
directly or may use broker-dealers to sell their shares. The broker-dealers will
either receive discounts or commissions from the selling stockholders, or they
will receive commissions from purchasers of shares. This compensation may be in
excess of customary commission.
The selling stockholders may also sell all or a portion of their shares
under Rule 144 under the Securities Act of 1933 (the "Securities Act"), or may
pledge shares as collateral for margin accounts. These shares could then further
be resold pursuant to the terms of such accounts.
Under certain circumstances, the selling stockholders and any
broker-dealers that participate in the distribution might be deemed to be
"underwriters" within the meaning of the Securities Act and any commission
received by them and any profit on the resale of the shares of common stock as
principal might be deemed to be underwriting discounts and commissions under the
Securities Act. The selling stockholders may agree to indemnify any agent,
dealer or broker-dealer that participates in transactions involving sales of the
shares against certain liabilities, including liabilities arising under the
Securities Act. Liabilities under the federal securities laws cannot be waived.
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<PAGE>
Because the selling stockholders may be deemed to be "underwriters" under
the Securities Act, the selling stockholders will be subject to prospectus
delivery requirements under the Securities Act. Furthermore, in the event of a
"distribution" of their shares, the selling stockholders, any selling broker or
dealer and any "affiliated purchasers" may be subject to Rule 10b-6 under the
Securities Exchange Act of 1934 (the "Exchange Act") or Regulation M under the
Exchange Act, which prohibits, with certain exceptions, any such person from
bidding for or purchasing any security which is the subject of such distribution
until such person's participation in that distribution is completed. In
addition, Rule 10b-7 under the Exchange Act or Regulation M prohibits any
"stabilizing bid" or "stabilizing purchase" for the purpose of pegging, fixing
or stabilizing the price of the common stock in connection with this offering.
We have informed the selling stockholders that the anti-manipulative provisions
of Regulation M promulgated under the Exchange Act may apply to their sales in
the market.
If we are notified by the selling stockholders that any material
arrangement has been entered into with a broker-dealer for the sale of shares
through a block trade, special offering, exchange distribution or secondary
distribution or a purchase by a broker or dealer, we will file a supplement to
this prospectus, if required, under Rule 424(b) under the Securities Act,
disclosing the following:
o the names of the selling stockholders and of the participating
broker-dealer(s);
o the number of shares involved;
o the price at which such shares were sold;
o the commissions paid or discounts or concessions allowed to such
broker-dealer(s), where applicable;
o that such broker-dealer(s) did not conduct any investigation to verify
the information set out or incorporated by reference in this
prospectus; and
o other facts material to the transaction.
In addition, if we are notified by the selling stockholders that a donee or
pledgee intends to sell more than 500 shares, we will file a supplement to this
prospectus.
The selling stockholders may be entitled under agreements entered into with
us to indemnification from us against liabilities under the Securities Act.
In order to comply with certain state securities laws, if applicable, these
shares of common stock will not be sold in a particular state unless they have
been registered or qualified for sale in that state or any exemption from
registration or qualification is available and complied with.
LEGAL MATTERS
An opinion will be delivered by Blank Rome Comisky & McCauley LLP,
Philadelphia, Pennsylvania, to the effect that the shares of our common stock
issuable upon the conversion of the Series 1-B and 2 Preferred Stock and the
exercise of the Warrants have been duly and validly authorized and, subsequent
to the conversion of the Series 1-B and 2 Preferred Stock and in the case of
the Warrants, payment of the exercise price therefor, will be legally issued,
fully paid and nonassessable.
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<PAGE>
EXPERTS
The financial statements incorporated in this prospectus by reference to
the Annual Report on Form 10-KSB for the year ended December 31, 1999, have been
so incorporated in reliance on the report of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR
SECURITIES ACT LIABILITIES
Our corporation is organized under the laws of the State of Delaware.
Section 145 of the Delaware General Corporation Law (the "DGCL"), in general,
empowers a Delaware corporation to indemnify any person who was or is a party or
is threatened to be made a party to any lawsuit or proceeding (other than an
action by or in the right of that corporation) due to the fact that such person
is or was a director, officer, employee or agent of that corporation, or is or
was serving at the request of that corporation as a director, officer, employee
or agent of another corporation or entity. A corporation is also allowed, in
advance of the final disposition of a lawsuit or proceeding, to pay the expenses
(including attorneys' fees) incurred by any officer, director, employee or agent
in defending the action, as long as the person undertakes to repay this amount
if it is ultimately determined that he or she is not entitled to be indemnified
by the corporation. In addition, Delaware law allows a corporation to indemnify
these persons against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by any of them in
connection with the lawsuit or proceeding if (a) he or she acted in good faith
and in a manner he or she reasonably believed to be in or not opposed to the
best interests of the corporation, and (b) with respect to any criminal action
or proceeding, had no reasonable cause to believe his or her conduct was
unlawful.
A Delaware corporation also can indemnify its officers and directors in an
action by or in the right of the corporation to procure a judgment in its favor
under the same conditions, except that judicial approval is needed to indemnify
any officer or director who is adjudged to be liable to the corporation. Where
an officer or director is successful on the merits or otherwise in the defense
of any such action, the corporation must indemnify him or her against the
expenses (including attorneys' fees) which he or she actually and reasonably
incurred in connection with this action. The indemnification provided by
Delaware law is not deemed to be exclusive of any other rights to which an
officer or director may be entitled under any corporation's own organizational
documents, agreements or otherwise.
As permitted by Section 145 of the DGCL, Section TWELFTH of our Certificate
of Incorporation (our "Certificate") provides that we will indemnify each person
who is or was our director, officer, employee or agent (including the heirs,
executors, administrators or estate of these individuals) or is or was serving
at our request as a director, officer, employee or agent of another entity, to
the fullest extent that the law permits. This indemnification is exclusive of
any other rights to which any of these individuals otherwise may be entitled.
The indemnification also continues after a person ceases to be a director,
officer, employee or agent of our company and inures to the benefit of the
heirs, executors and administrators of these individuals. Expenses (including
attorneys' fees) incurred in defending any lawsuit or proceeding are also paid
by us in advance of the final disposition of these lawsuits or proceedings after
we receive an undertaking from the indemnified person to repay this amount if it
is ultimately determined that he or she is not entitled to be indemnified by us.
Section ELEVENTH of our Certificate further provides that our directors are not
personally liable to us or our stockholders of monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any breach of his or
her duty of loyalty to us or our stockholder, (ii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of the DGCL (which deals with unlawful dividends or
stock purchases or redemptions), or (iv) for any transaction from which he or
15
<PAGE>
she derived an improper personal benefit. Our By-laws also provide that, to the
fullest extent permitted by law, we will indemnify any person who is a party or
otherwise involved in any proceeding because of the fact that he or she is or
was a director or officer of our company or was serving at our request.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to our directors, officers and controlling persons
pursuant to any of these foregoing provisions, or otherwise, we have been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act and
is therefore unenforceable.
16
<PAGE>
PART II INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses Of Issuance And Distribution
The following table sets forth the company's estimates (other than of the
SEC registration fee) of the expenses in connection with the issuance and
distribution of the shares of common stock being registered:
SEC registration fee...................................... $24,261.57
Legal fees and expenses................................... $15,000
Accounting fees and expenses.............................. $ 5,000
Miscellaneous expenses.................................... $ 2,000
-------
Total:............................................ $46,261.57
None of these expenses are being paid by the selling stockholders.
Item 15. Indemnification Of Directors And Officers
Section 145 of the Delaware General Corporation Law (the "DGCL") empowers a
Delaware corporation to indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of such corporation) by reason of the
fact that such person is or was a director, officer, employee or agent of such
corporation, or is or was serving at the request of such corporation as a
director, officer, employee or agent of another corporation or enterprise. A
corporation may, in advance of the final disposition of any civil, criminal,
administrative or investigative action, suit or proceeding, pay the expenses
(including attorneys' fees) incurred by any officer, director, employee or agent
in defending such action, provided that the director or officer undertakes to
repay such amount if it shall ultimately be determined that he or she is not
entitled to be indemnified by the corporation. A corporation may indemnify such
person against expenses (including attorney's fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by such person in
connection with such action, suit or proceeding if he or she acting in good
faith and in a manner he or she reasonably believed to be in or not opposed to
the best interests of the corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his or her conduct was
unlawful.
A Delaware corporation may indemnify officers and directors in an action by
or in the right of the corporation to procure a judgment in its favor under the
same conditions, except that no indemnification is permitted without judicial
approval if the officer or director is adjudged to be liable to the corporation.
Where an officer or director is successful on the merits or otherwise in the
defense of any action referred to above, the corporation must indemnify him or
her against the expenses (including attorneys' fees) which he or she actually
and reasonably incurred in connection therewith. The indemnification provided is
not deemed to be exclusive of any other rights to which an officer or director
may be entitled under any corporation's by law, agreement, vote or otherwise.
In accordance with Section 145 of the DGCL, Section TWELFTH of the
Company's Certificate of Incorporation (the "Certificate") provides that the
Company shall indemnify each person who is or was a director, officer, employee
or agent of the Company (including the heirs, executors, administrators or
estate of such person) or is or was serving at the request of the Company as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, to the fullest extent permitted. The
indemnification provided by the Certificate shall not be deemed exclusive of any
other rights to which any of those seeking indemnification or advancement of
expenses may be entitled
II-1
<PAGE>
under any by-law, agreement, vote of shareholders or disinterested directors or
otherwise, bot as to action in his official capacity and as to action in another
capacity while holding such office, and shall continue as to a person who has
ceased to be a director, officer, employee or agent and shall inure to the
benefit of the heirs, executors and administrators of such a person. Expenses
(including attorneys' fees) incurred in defending a civil, criminal,
administrative or investigative action, suit or proceeding shall be paid by the
company in advance of the final disposition of such action, suit or proceeding
upon receipt of an undertaking by or on behalf of the indemnified person to
repay such amount if it shall ultimately be determined that he or she is not
entitled to be indemnified by the Company. Section ELEVENTH of the Certificate
provides that a director of the Company shall not be personally liable to the
Company or its stockholders for monetary damages for breach of fiduciary duty as
a director, except for liability (i) for any breach of the director's duty of
loyalty to the Company or its stockholders, (ii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of the DGCL, or (iv) for any transaction from which
the director derived an improper personal benefit. The By-laws of the Company
provide that, to the fullest extent permitted by applicable law, the Company
shall indemnify any person who is a party or otherwise involved in any
proceeding by reason of the fact that such person is or was a director or
officer of the Company or was serving at the request of the Company.
Item 16. Exhibits
Exhibit
Number Description of Document
------ -----------------------
2 Agreement and Plan of Merger, dated as of July 26, 1999, between Global
Pharmaceutical Corporation and Impax Pharmaceuticals, Inc. (1)
3.1 Restated Certificate of Incorporation of the Company. (2)
3.2 By-laws of the Company. (2)
3.3 Form of the Certificate of Amendment of Restated Certificate of
Incorporation of Global Pharmaceutical Corporation. (1)
3.4 Certificate of Designations of Series 1-A Convertible Preferred Stock
and Series 1-B Convertible Preferred Stock. (1)
3.5 Certificate of Designations of Series 2 Convertible Preferred
Stock. (4)
4.1 Specimen Certificate of the Company's Common Stock, par value $.01 per
share. (1)
5.1 Opinion of Blank Rome Comisky & McCauley LLP.
9.1 Form of Stockholders' Agreement, dated as of December 14, 1999, between
Global Pharmaceutical Corporation and certain stockholders. (1)
10.1 Stock and Warrant Purchase Agreement, dated March 2, 1999, between the
Company and Fleming US Discovery Fund III, L.P. (3)
23.1 Consent of PricewaterhouseCoopers LLP.
24.1 Power of Attorney (included on signature page).
27 Financial Data Schedule. (4)
II-2
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99.1 Court Order issued May 25, 1993 by the United States District Court for
the Eastern District of Pennsylvania against Richlyn Laboratories,
Inc. (2)
99.2 Form of Escrow Agreement, dated as of December 14, 1999, among Global
Pharmaceutical Corporation , Continental Stock Transfer and Trust
Company, as escrow agent, Charles Hsiao, Ph.D. and Larry Hsu, Ph.D.,
in the capacity of the selling stockholder's agents, and each of the
selling stockholders of Impax. (1)
----------------------
(1) Previously filed with the Commission as Exhibits to, and incorporated
herein by reference from, the Registration Statement on Form S-4
(File No. 333-90599).
(2) Previously filed with the Commission as Exhibits to, and incorporated
herein by reference from, the Registrant's Registration Statement on
Form SB-2 (File No. 33-99310-NY).
(3) Previously filed with the Commission as an Exhibit to, and incorporated
herein by reference from, the Registrant's Registration Statement on
Form S-3 (File No. 333-81883).
(4) Previously filed with the Commission as Exhibits to, and incorporated
herein by reference from, the Registrant's Annual Report on Form 10-KSB
for the year 1999.
Item 17. Undertakings
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
a 20 percent change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement; provided, however, that paragraphs (a)(1)(i)
and (a)(1)(ii) do not apply if the information required to be included
in a post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
II-3
<PAGE>
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions described under Item 15 above, or
otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
(c) The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective by the
Securities and Exchange Commission.
(2) For the purposes of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-4
<PAGE>
SIGNATURES AND POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
the requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the city of Philadelphia, Commonwealth of Pennsylvania on June
29, 2000.
IMPAX LABORATORIES, INC.
By: /s/ Barry R. Edwards
-----------------------------------
Barry R. Edwards,
Co-Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Barry R. Edwards, his true and lawful
attorney-in-fact and agent with full power of substitution or resubstitution,
for him and in his name, place and stead, in any and all capacities, to sign any
and all amendments to this Registration Statement, and to file the same, with
all exhibits thereto, and other documentation in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons on June 29,
2000 in the capacities indicated.
<TABLE>
<CAPTION>
Name Title
---- -----
<S> <C>
/s/ Barry R. Edwards Co-Chief Executive Officer and Director
-----------------------------------
Barry R. Edwards
/s/ Charles Hsiao, P.h.D. Chairman, Co-Chief Executive Officer and Director
-----------------------------------
Charles Hsiao, P.h.D.
/s/ Larry Hsu, P.h.D. President, Chief Operating Officer and Director
-----------------------------------
Larry Hsu, P.h.D.
/s/ David J. Edwards Director
-----------------------------------
David J. Edwards
/s/ Nigel Fleming Director
-----------------------------------
Nigel Fleming
/s/ Brian Keng
----------------------------------- Director
Brian Keng
----------------------------------- Director
Jason Lin
/s/ Michael Markbreiter Director
-----------------------------------
Michael Markbreiter
----------------------------------- Director
Oh Kim Sun
</TABLE>
II-5
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description of Document
------- -----------------------
2 Agreement and Plan of Merger, dated as of July 26, 1999, between
Global Pharmaceutical Corporation and Impax Pharmaceuticals, Inc.(1)
3.1 Restated Certificate of Incorporation of the Company.(2)
3.2 By-laws of the Company.(2)
3.3 Form of Certificate of Amendment of Restated Certificate of
Incorporation of Global Pharmaceutical Corporation.(1)
3.4 Certificate of Designations of Series 1-A Convertible Preferred Stock
and Series 1-B Convertible Preferred Stock.(1)
3.5 Certificate of Designations of Series 2 Convertible Preferred
Stock.(4)
4.1 Specimen Certificate of the Company's Common Stock, par value $0.01 per
share.(1)
5.1 Opinion of Blank Rome Comisky & McCauley LLP.
9.1 Form of Stockholders' Agreement, dated as of December 14, 1999, between
Global Pharmaceutical Corporation and certain stockholders.(1)
10.1 Stock and Warrant Purchase Agreement, dated March 2, 1999, between the
Company and Fleming US Discovery Fund III, L.P.(3)
23.1 Consent of PricewaterhouseCoopers LLP.
24.1 Power of Attorney (included on signature page).
27 Financial Data Schedule.(4)
99.1 Court Order issued May 25, 1993 by the United States District Court
for the Eastern District of Pennsylvania against Richlyn Laboratories,
Inc.(2)
99.2 Form of Escrow Agreement, dated as of December 14, 1999, among Global
Pharmaceutical Corporation, Continental Stock Transfer and Trust
Company, as escrow agent, Charles Hsiao, Ph.D. and Larry Hsu, Ph.D.,
in the capacity of the selling stockholders' agents, and each of
the selling stockholders of Impax.(1)
---------------------
(1) Previously filed with the Commission as Exhibits to, and incorporated
herein by reference from, the Registration Statement on Form S-4
(File No. 333-90599).
II-6
<PAGE>
(2) Previously filed with the Commission as Exhibits to, and incorporated
herein by reference from, the Registrant's Registration Statement on
Form SB-2 (File No. 33-99310-NY).
(3) Previously filed with the Commission as Exhibits to, and incorporated
herein by reference from, the Registrant's Registration Statement on
Form S-3 (File No. 333-81883).
(4) Previously filed with the Commission as Exhibits to, and incorporated
herein by reference from, the Registrant's Annual Report on Form 10-KSB
for the year 1999.
II-7
