<PAGE>
As filed with the Securities and Exchange Commission on June 3, 1999
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
ChiRex Inc.
(Exact name of registrant as specified in its charter)
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<TABLE>
<CAPTION>
<S> <C>
Delaware 04-3296309
(State or other jurisdiction of incorporation (I.R.S. Employer Identification Number)
or organization)
</TABLE>
300 Atlantic Street, Suite 402
Stamford, Connecticut 06901
203-351-2300
(Address, including zip code, and telephone number, including area code, of
registrant's principal execution offices)
Thomas I. H. Dubin, Esq.
Vice President, General Counsel and Secretary
ChiRex Inc.
300 Atlantic Street, Suite 402
Stamford, Connecticut 06901
203-351-2300
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copy to
Kris F. Heinzelman, Esq.
Cravath, Swaine & Moore
Worldwide Plaza
825 Eighth Avenue
New York, New York 10019
Approximate date of commencement 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 to be 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, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box: [X]
CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
Proposed maximum Proposed maximum
Title of each class offering aggregate
of securities to Amount to be price per offering Amount of
be registered registered unit(1) price(2) Registration Fee
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<S> <C> <C> <C> <C>
Debt Securities(4)......
Preferred Stock, par
value
$.01 per share (5)(6)..
Depositary Shares(6).... (3) (3) (3) (3)
Common Stock, par value
$.01 per share(7)......
Warrants(8).............
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Total................... $104,625,000(9) 100% $104,625,000(9) $29,085.75(10)
</TABLE>
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(1) The proposed maximum offering price per unit will be determined from time
to time by the registrant in connection with the issuance by the
registrant of the securities registered hereunder.
(2) The proposed maximum aggregate offering price has been estimated solely
for the purpose of calculating the registration fee pursuant to Rule
457(o) under the Securities Act of 1933.
(3) Not applicable pursuant to General Instructions II.D. of Form S-3.
(footnotes continued on next page)
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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 or until the Registration Statement shall
become effective on such date as the Commission, acting pursuant to said
Section 8(a), may determine.
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Post-Effective Amendment No. 1 to Registration Statement No. 333-68849
<PAGE>
(continued from previous page)
(4) Subject to note (9) below, there is being registered hereunder an
indeterminate principal amount of Debt Securities as may be sold, from
time to time, by the registrant. If any Debt Securities are issued at an
original issue discount, then the offering price shall be in such greater
principal amount as shall result in an aggregate initial offering price
not to exceed $104,625,000 less the dollar amount of any securities
previously issued hereunder.
(5) Subject to note (9) below, there is being registered hereunder an
indeterminate number of shares of Preferred Stock as may be sold, from
time to time, by the registrant. There are also being registered
hereunder an indeterminate number of shares of Preferred Stock as shall
be issuable upon the exercise of certain associated Rights (as defined)
to purchase fractional interests in shares of Preferred Stock. Until the
occurrence of certain prescribed events, none of which has occurred, the
Rights are not exercisable.
(6) Subject to note (9) below, there is being registered hereunder an
indeterminate number of Depositary Shares (to be evidenced by Depositary
Receipts issued pursuant to a Deposit Agreement) as may be sold, from
time to time, by the registrant. In the event the registrant elects to
offer fractional interests in shares of Preferred Stock registered
hereunder, Depositary Receipts will be distributed to those persons
purchasing such fractional interests and the shares of Preferred Stock
will be issued to the depositary under the Deposit Agreement.
(7) Subject to note (9) below, there is being registered hereunder an
indeterminate number of shares of Common Stock as may be sold, from time
to time, by the registrant. There are also being registered hereunder (i)
an indeterminate number of shares of Common Stock as may be issuable upon
conversion or redemption of Preferred Stock or Debt Securities registered
hereunder and (ii) the Rights referred to in note (5) above. Until the
occurrence of certain prescribed events, none of which has occurred, the
Rights are evidenced by the certificates representing the Common Stock
and will be transferred along with and only with the Common Stock. After
the occurrence of certain prescribed events, none of which has occurred,
the Rights will be evidenced by separate certificates.
(8) Subject to note (9) below, there is being registered hereunder an
indeterminate amount and number of Warrants, (representing rights to
purchase Debt Securities, Preferred Stock, or Common Stock registered
hereunder) as may be sold, from time to time, by the registrant.
(9) In no event will the aggregate initial offering price of all securities
issued from time to time pursuant to this Registration Statement exceed
$104,625,000 or the equivalent thereof in one or more foreign currencies,
foreign currency units or composite currencies. The securities registered
hereunder may be sold separately or as units with other securities
registered hereunder.
(10) Pursuant to Rule 429 of the Rules and Regulations of the Securities and
Exchange Commission under the Securities Act, this Registration
Statement contains a prospectus that also relates to the $45,375,000 of
Debt Securities, Preferred Stock, Depositary Shares, Common Stock and
Warrants registered on the Registration Statement on Form S-3 (No. 333-
68849) (relating to an aggregate $100,000,000 of debt securities,
preferred stock, depositary shares, common stock and warrants)
previously filed by the Registrant and declared effective on December
28, 1998 and as to which a filing fee of $12,614.25 was paid. This
Registration Statement constitutes Post-Effective Amendment No. 1 to
Registrant's Registration Statement on Form S-3 (No. 333-68849) and such
Post-Effective Amendment No. 1 shall hereafter become effective
concurrently with the effectiveness of this Registration Statement and
in accordance with Section 8(c) of the Securities Act.
<PAGE>
PROSPECTUS
ChiRex Inc.
DEBT SECURITIES,
PREFERRED STOCK,
DEPOSITARY SHARES,
WARRANTS
AND COMMON STOCK
From time to time, we may sell any of the following securities:
. Debt securities which may be
--senior or subordinated in priority of payment
--convertible or exchangeable into other of our securities or the
securities of another issuer
. Preferred stock which may be convertible into our common stock or
exchangeable for our debt securities
. Depositary shares which represent a fractional share of our preferred stock
. Warrants which would allow a buyer to purchase our debt securities, preferred
stock or common stock
. Common stock
When we decide to sell a particular series of securities, we will prepare a
Prospectus Supplement describing such securities offering and the particular
terms of the securities. You should read this Prospectus and any Prospectus
Supplement carefully.
Our common stock is listed on the Nasdaq Stock Market's National Market under
the trading symbol "CHRX".
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved the securities to be issued under this
Prospectus or determined if this Prospectus is accurate or adequate. Any
representation to the contrary is a criminal offense.
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The date of this Prospectus is , 1999.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
About This Prospectus..................................................... i
Where You Can Find More Information....................................... ii
Disclosure Regarding Forward-Looking Statements........................... ii
The Company............................................................... 1
Use of Proceeds........................................................... 2
Ratio of Earnings to Fixed Charges and Earnings to Fixed Charges--Coverage
Deficiency............................................................... 2
Description of Debt Securities............................................ 3
Description of Capital Stock.............................................. 15
Description of Depositary Shares.......................................... 18
Description of Warrants................................................... 21
Plan of Distribution...................................................... 22
Legal Opinions............................................................ 23
Experts................................................................... 23
</TABLE>
This Prospectus is part of a Registration Statement that we filed with the
Securities and Exchange Commission (the "SEC") utilizing a "shelf" registration
process. Under this shelf process, we may, from time to time over approximately
the next two years, sell any combination of the securities described in this
Prospectus in one or more offerings up to a total dollar amount of $150,000,000
or the equivalent of this amount in foreign currencies or foreign currency
units.
This Prospectus provides you with a general description of the securities we
may offer. Each time we sell securities, we will provide a Prospectus
Supplement that will contain specific information about the terms of that
offering. The Prospectus Supplement may also add, update or change information
contained in this Prospectus. You should read both this Prospectus and any
Prospectus Supplement together with additional information described under the
heading "Where You Can Find More Information About the Company" beginning on
page (ii) of this Prospectus.
You should rely only on the information contained in this Prospectus. We have
not authorized anyone to provide you with information different from that
contained in this Prospectus. We are offering to sell securities and making
offers to buy securities only in jurisdictions where offers and sales are
permitted. The information contained in this Prospectus is accurate only as of
the date of this Prospectus, regardless of the time of delivery of this
Prospectus or any sale of the securities. In this Prospectus, the "Company,"
"ChiRex," "we," "us" and "our" refer to CHIREX INC.
i
<PAGE>
WHERE YOU CAN FIND MORE
INFORMATION ABOUT THE COMPANY
We file annual, quarterly and current reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's public reference rooms in Washington, D.C., New York, New York and
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 at the SEC's web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" into this prospectus the
information we file with it, 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 a part of this prospectus, and
later information filed with the SEC will update and supersede this
information. We incorporate by reference the documents listed below and any
future filings made with the SEC under Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act until our offering is completed:
(1) Annual Report on Form 10-K for the year ended December 31, 1998; and
(2) Quarterly Report on Form 10-Q for the quarter ended March 31, 1999;
You may request a copy of these filings, at no cost, by writing to or
telephoning us at the following address:
Thomas I.H. Dubin, Esq.
Vice President, General Counsel and Secretary
ChiRex Inc.
300 Atlantic Street, Suite 402
Stamford, Connecticut 06901
(203) 351-2300
DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
This Prospectus contains "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933 (the "Securities Act") and Section
21E of the Securities Exchange Act of 1934, as amended, (the "Exchange Act").
These forward-looking statements are subject to a number of risks and
uncertainties, many of which are beyond the Company's control. Forward-looking
statements are typically identified by the words "believe," "expect,"
"anticipate," "intent," "estimate" and similar expressions.
Actual results could differ materially from those contemplated by these
forward-looking statements as a result of factors ("Cautionary Statements")
such as product development and market acceptance risks, product manufacturing
risks, the impact of competitive products and pricing, the results of current
and future licensing and other collaborative relationships, the results of
financing efforts, developments regarding intellectual property rights and
litigation, risks of product non-approval or delays or post-approval reviews by
the U.S. Food and Drug Administration ("FDA") or foreign regulatory
authorities.
In light of these risks and uncertainties, there can be no assurance that the
results and events contemplated by the forward-looking information contained in
this Prospectus will in fact transpire. Potential investors are cautioned not
to place undue reliance on these forward-looking statements. The Company does
not undertake any obligation to update or revise any forward-looking
statements. All subsequent written or oral forward-looking statements
attributable to the Company or persons acting on behalf of the Company are
expressly qualified in their entirety by the Cautionary Statements.
ii
<PAGE>
THE COMPANY
ChiRex is an integrated outsourcing company that provides an extensive range
of services to pharmaceutical and life science companies. Our services span
from the early stages of post-discovery drug development to full scale
manufacturing of active ingredients. As a customer discovers a new molecule
for possible drug therapies, the creation of the compound goes through a
number of phases, any one or all of which are suitable for outsourcing to
third parties such as ChiRex, including:
. design, development and synthesis of molecules, including process
development;
. evaluation, analysis and scale-up activities; and
. full scale production in accordance with current Good Manufacturing
Practices at two FDA inspected sites.
We are one of only a few outsourcing companies to offer all of these
services in-house in addition to offering proprietary process technologies. By
offering integrated services, we are able to minimize the risks, costs and
time associated with our customers bringing new drugs to market. Specifically,
we provide contract process research and development and pharmaceutical fine
chemical manufacturing services, while also offering our customers access to
our extensive portfolio of proprietary technologies. Our contract
manufacturing services, developed over the past 30 years, include process
research and development, hazard evaluation, analytical methods development,
clinical quantity production and both pilot-scale and commercial scale
manufacturing. In addition, we utilize our proprietary technologies to solve
process development challenges for our customers and reduce drug development
time.
1
<PAGE>
USE OF PROCEEDS
Unless otherwise set forth in the applicable Prospectus Supplement, the net
proceeds from the sale of the Offered Securities will be used for general
corporate purposes, which may include repayment of indebtedness, acquisitions,
additions to working capital, capital expenditures and repurchases and
redemption of securities.
RATIO OF EARNINGS TO FIXED CHARGES AND
EARNINGS TO FIXED CHARGES--COVERAGE DEFICIENCY
The following table sets forth the Company's consolidated ratio of earnings
to fixed charges and earnings to fixed charges--coverage deficiency for each
of the years ended December 31, 1994, 1995, 1996, 1997 and 1998 and for the
three months ended March 31, 1999.
<TABLE>
<CAPTION>
Year Ended December 31, Three Months
---------------------------- Ended
1994 1995 1996 1997 1998 March 31, 1999
---- ---- ------ ------ ---- --------------
<S> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed
charges.......................... N/A N/A N/A N/A 1.34x 2.95x
Earnings to fixed charges--
coverage deficiency.............. N/A N/A $6,442 $1,135 N/A N/A
</TABLE>
For purposes of calculating the ratio of earnings to fixed charges and the
amount of earnings to fixed charges--coverage deficiency (the difference
between earnings and the amount of the fixed charges), earnings represent
income (losses) before income taxes and fixed charges, excluding capitalized
interest. Fixed charges consist of the total of (i) interest, whether
capitalized or expensed, and (ii) amortization of deferred debt costs.
2
<PAGE>
DESCRIPTION OF DEBT SECURITIES
The following description of the terms of the Debt Securities sets forth
certain general terms and provisions of the Debt Securities to which any
Prospectus Supplement may relate. The particular terms of the Debt Securities
offered by any Prospectus Supplement and the extent, if any, to which such
general provisions may apply to the Debt Securities so offered will be
described in the Prospectus Supplement relating to such Debt Securities.
Accordingly, for a description of the terms of a particular issue of Debt
Securities, reference must be made to both the Prospectus Supplement relating
thereto and to the following description.
The Debt Securities will be general obligations of the Company and may be
subordinated to "Senior Indebtedness" (as defined below) of the Company to the
extent set forth in the Prospectus Supplement relating thereto. See
"Description of Debt Securities--Subordination" below. Debt Securities will be
issued under an indenture (the "Indenture") between the Company and one or
more commercial banks to be selected as trustees (collectively, the
"Trustee"). A copy of the form of Indenture has been filed as an exhibit to
the Registration Statement filed with the SEC. The following discussion of
certain provisions of the Indenture is a summary only and does not purport to
be a complete description of the terms and provisions of the Indenture.
Accordingly, the following discussion is qualified in its entirety by
reference to the provisions of the Indenture, including the definition therein
of terms used below.
General
The Indenture does not limit the aggregate principal amount of Debt
Securities that can be issued thereunder. The Debt Securities may be issued in
one or more series as may be authorized from time to time by the Company.
Reference is made to the applicable Prospectus Supplement for the following
terms of the Debt Securities of the series with respect to which such
Prospectus Supplement is being delivered:
(a) the title of the Debt Securities of the series;
(b) any limit on the aggregate principal amount of the Debt Securities of
the series that may be authenticated and delivered under the Indenture;
(c) the date or dates on which the principal and premium with respect to
the Debt Securities of the series are payable;
(d) the rate or rates (which may be fixed or variable) at which the Debt
Securities of the series shall bear interest (if any) or the method of
determining such rate or rates, the date or dates from which such interest
shall accrue, the interest payment dates on which such interest shall be
payable or the method by which such dates will be determined, the record
dates for the determination of holders thereof to whom such interest is
payable (in the case of Registered Securities (as defined below)), and the
basis upon which interest will be calculated if other than that of a 360-
day year of twelve 30-day months;
(e) the place or places, if any, in addition to or instead of the
corporate trust office of the Trustee (in the case of Registered
Securities) or the principal London office of the Trustee (in the case of
Bearer Securities), where the principal, premium, and interest with respect
to Debt Securities of the series shall be payable;
(f) the price or prices at which, the period or periods within which, and
the terms and conditions upon which Debt Securities of the series may be
redeemed, in whole or in part, at the option of the Company or otherwise;
(g) whether Debt Securities of the series are to be issued as Registered
Securities or Bearer Securities (as defined below) or both and, if Bearer
Securities are to be issued, whether coupons will be attached thereto,
whether Bearer Securities of the series may be exchanged for Registered
Securities of the series, and the circumstances under which and the places
at which any such exchanges, if permitted, may be made;
3
<PAGE>
(h) if any Debt Securities of the series are to be issued as Bearer
Securities or as one or more Global Securities (as defined below)
representing individual Bearer Securities of the series, whether certain
provisions for the payment of additional interest or tax redemptions shall
apply; whether interest with respect to any portion of a temporary Bearer
Security of the series payable with respect to any interest payment date
prior to the exchange of such temporary Bearer Security for definitive
Bearer Securities of the series shall be paid to any clearing organization
with respect to the portion of such temporary Bearer Security held for its
account and, in such event, the terms and conditions (including any
certification requirements) upon which any such interest payment received
by a clearing organization will be credited to the persons entitled to
interest payable on such interest payment date; and the terms upon which a
temporary Bearer Security may be exchanged for one or more definitive
Bearer Securities of the series;
(i) the obligation, if any, of the Company to redeem, purchase, or repay
Debt Securities of the series pursuant to any sinking fund or analogous
provisions or at the option of a holder thereof and the price or prices at
which, the period or periods within which, and the terms and conditions
upon which Debt Securities of the series shall be redeemed, purchased, or
repaid, in whole or in part, pursuant to such obligations;
(j) the terms, if any, upon which the Debt Securities of the series may
be convertible into or exchanged for Common Stock, Preferred Stock (which
may be represented by Depositary Shares), other Debt Securities or warrants
for Common Stock, Preferred Stock, indebtedness or other securities of any
kind of the Company or any other issuer or obligor and the terms and
conditions upon which such conversion or exchange shall be effected,
including the initial conversion or exchange price or rate, the conversion
or exchange period and any other additional provisions;
(k) if other than denominations of $1,000 or any integral multiple
thereof, the denominations in which Debt Securities of the series shall be
issuable;
(l) if the amount of principal, premium or interest with respect to the
Debt Securities of the series may be determined with reference to an index
or pursuant to a formula, the manner in which such amounts will be
determined;
(m) if the principal amount payable at the stated maturity of Debt
Securities of the series will not be determinable as of any one or more
dates prior to such stated maturity, the amount that will be deemed to be
such principal amount as of any such date for any purpose, including the
principal amount thereof which will be due and payable upon any maturity
other than the stated maturity or which will be deemed to be outstanding as
of any such date (or, in any such case, the manner in which such deemed
principal amount is to be determined), and if necessary, the manner of
determining the equivalent thereof in United States currency;
(n) any changes or additions to the provisions of the Indenture dealing
with defeasance;
(o) any provision for the Offered Securities to be denominated, and
payments thereon to be made, in currencies other than the U.S. dollar
(including the Euro) or in units based on or relating to such other
currencies (including ECUs);
(p) if other than such coin or currency of the United States as at the
time of payment is legal tender for payment of public and private debts,
the coin or currency or currencies or units of two or more currencies in
which payment of the principal, premium, and interest with respect to Debt
Securities of the series shall be payable;
(q) if other than the principal amount thereof, the portion of the
principal amount of Debt Securities of the series that shall be payable
upon declaration of acceleration of the maturity thereof or provable in
bankruptcy;
(r) the terms, if any, of the transfer, mortgage, pledge or assignment as
security for the Debt Securities of the series of any properties, assets,
moneys, proceeds, securities or other collateral, including whether
4
<PAGE>
certain provisions of the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act") are applicable and any corresponding changes to
provisions of the Indenture as then in effect;
(s) any addition to or change in the Events of Default (as defined below)
with respect to the Debt Securities of the series and any change in the
right of the Trustee or the holders to declare the principal, premium and
interest with respect to such Debt Securities due and payable;
(t) if the Debt Securities of the series shall be issued in whole or in
part in the form of a Global Security, the terms and conditions, if any,
upon which such Global Security may be exchanged in whole or in part for
other individual Debt Securities in definitive registered form, the
Depositary (as defined in the applicable Prospectus Supplement) for such
Global Security and the form of any legend or legends to be borne by any
such Global Security in addition to or in lieu of the legend referred to in
the Indenture;
(u) any Trustee, authenticating or paying agents, transfer agents or
registrars;
(v) the applicability of, and any addition to or change in, the covenants
and definitions then set forth in the Indenture or in the terms then set
forth in the Indenture relating to permitted consolidations, mergers, or
sales of assets;
(w) the terms, if any, of any guarantee of the payment of principal,
premium, and interest with respect to Debt Securities of the series and any
corresponding changes to the provisions of the Indenture as then in effect;
(x) the subordination, if any, of the Debt Securities of the series
pursuant to the Indenture and any changes or additions to the provisions of
the Indenture relating to subordination;
(y) with regard to Debt Securities of the series that do not bear
interest, the dates for certain required reports to the Trustee; and
(z) any other terms of the Debt Securities of the series (which terms
shall not be prohibited by the provisions of the Indenture).
The Prospectus Supplement will also describe any material United States
federal income tax consequences or other special considerations applicable to
the series of Debt Securities to which such Prospectus Supplement relates,
including those applicable to (a) Bearer Securities, (b) Debt Securities with
respect to which payments of principal, premium or interest are determined
with reference to an index or formula (including changes in prices of
particular securities, currencies or commodities), (c) Debt Securities with
respect to which principal, premium or interest is payable in a foreign or
composite currency, (d) Debt Securities that are issued at a discount below
their stated principal amount, bearing no interest or interest at a rate that
at the time of issuance is below market rates ("Original Issue Discount Debt
Securities") and (e) variable rate Debt Securities that are exchangeable for
fixed rate Debt Securities.
Unless otherwise provided in the applicable Prospectus Supplement,
Registered Securities may be transferred or exchanged at the office of the
Trustee at which its corporate trust business is principally administered in
the United States or at the office of the Trustee or the Trustee's agent in
the Borough of Manhattan, the City and State of New York, at which its
corporate agency business is conducted, subject to the limitations provided in
the Indenture, without the payment of any service charge, other than any tax
or governmental charge payable in connection therewith. Bearer Securities will
be transferable only by delivery. Provisions with respect to the exchange of
Bearer Securities will be described in the Prospectus Supplement relating to
such Bearer Securities.
All funds paid by the Company to a paying agent for the payment of
principal, premium or interest with respect to any Debt Securities that remain
unclaimed at the end of two years after such principal, premium or interest
shall have become due and payable will be repaid to the Company, and the
holders of such Debt Securities or any coupons appertaining thereto will
thereafter look only to the Company for payment thereof.
5
<PAGE>
Global Securities
The Debt Securities of a series may be issued in whole or in part in the
form of one or more Global Securities. A Global Security is a Debt Security
that represents, and is denominated in an amount equal to the aggregate
principal amount of, all outstanding Debt Securities of a series, or any
portion thereof, in either case having the same terms, including the same
original issue date, date or dates on which principal and interest are due,
and interest rate or method of determining interest. A Global Security will be
deposited with, or on behalf of, a Depositary, which will be identified in the
Prospectus Supplement relating to such Debt Securities. Global Securities may
be issued in either registered or bearer form and in either temporary or
definitive form. Unless and until it is exchanged in whole or in part for the
individual Debt Securities represented thereby, a Global Security may not be
transferred except as a whole by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or another
nominee of the Depositary, or by the Depositary or any nominee of the
Depositary to a successor Depositary or any nominee of such successor.
The specific terms of the depositary arrangement with respect to a series of
Debt Securities will be described in the Prospectus Supplement relating to
such Debt Securities. The Company anticipates that the following provisions
will generally apply to depositary arrangements.
Upon the issuance of a Global Security, the Depositary for such Global
Security will credit, on its book-entry registration and transfer system, the
respective principal amounts of the individual Debt Securities represented by
such Global Security to the accounts of persons that have accounts with the
Depositary ("participants"). Such accounts shall be designated by the dealers
or underwriters with respect to such Debt Securities or, if such Debt
Securities are offered and sold directly by the Company or through one or more
agents, by the Company or such agents. Ownership of beneficial interests in a
Global Security will be limited to participants or persons that hold
beneficial interests through participants. Ownership of beneficial interests
in such Global Security will be shown on, and the transfer of that ownership
will be effected only through, records maintained by the Depositary (with
respect to interests of participants) or records maintained by participants
(with respect to interests of persons other than participants). The laws of
some states require that certain purchasers of securities take physical
delivery of such securities in definitive form. Such limitations and laws may
impair the ability to transfer beneficial interests in a Global Security.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner or holder of such Global Security, such Depositary or
nominee, as the case may be, will be considered the sole owner or holder of
the individual Debt Securities represented by such Global Security for all
purposes under the Indenture. Except as provided below, owners of beneficial
interests in a Global Security will not be entitled to have any of the
individual Debt Securities represented by such Global Security registered in
their names, will not receive or be entitled to receive physical delivery of
any of such Debt Securities in definitive form, and will not be considered the
owners or holders thereof under the Indenture.
Subject to the restrictions applicable to Bearer Securities described in an
applicable Prospectus Supplement (see "Limitations on Issuance of Bearer
Securities" below), payments of principal, premium, and interest with respect
to individual Debt Securities represented by a Global Security will be made to
the Depositary or its nominee, as the case may be, as the registered owner or
holder of such Global Security. Neither the Company, the Trustee, any paying
agent or registrar for such Debt Securities or any agent of the Company or the
Trustee will have any responsibility or liability for (a) any aspect of the
records relating to or payments made by the Depositary, its nominee or any
participants on account of beneficial interests in the Global Security or for
maintaining, supervising or reviewing any records relating to such beneficial
interests, (b) the payment to the owners of beneficial interests in the Global
Security of amounts paid to the Depositary or its nominee or (c) any other
matter relating to the actions and practices of the Depositary, its nominee or
its participants. Neither the Company, the Trustee, any paying agent or
registrar for such Debt Securities or any agent of the Company or the Trustee
will be liable for any delay by the Depositary, its nominee or any of its
participants in identifying the owners of beneficial interests in the Global
Security, and the Company and the Trustee may conclusively rely on, and will
be protected in relying on, instructions from the Depositary or its nominee
for all purposes.
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The Company expects that the Depositary for a series of Debt Securities or
its nominee, upon receipt of any payment of principal, premium or interest
with respect to a definitive Global Security representing any of such Debt
Securities, will immediately credit participants' accounts with payments in
amounts proportionate to their respective beneficial interests in the
principal amount of such Global Security, as shown on the records of the
Depositary or its nominee. The Company also expects that payments by
participants to owners of beneficial interests in such Global Security held
through such participants will be governed by standing instructions and
customary practices, as is now the case with securities held for the accounts
of customers and registered in "street name." Such payments will be the
responsibility of such participants. Receipt by owners of beneficial interests
in a temporary Global Security of payments of principal, premium or interest
with respect thereto will be subject to the restrictions described in an
applicable Prospectus Supplement (see "Limitation on Issuance of Bearer
Securities" below).
If the Depositary for a series of Debt Securities is at any time unwilling,
unable or ineligible to continue as depositary, the Company shall appoint a
successor depositary. If a successor depositary is not appointed by the
Company within 90 days, the Company will issue individual Debt Securities of
such series in exchange for the Global Security representing such series of
Debt Securities. In addition, the Company may at any time and in its sole
discretion, subject to any limitations described in the Prospectus Supplement
relating to such Debt Securities, determine to no longer have Debt Securities
of a series represented by a Global Security and, in such event, will issue
individual Debt Securities of such series in exchange for the Global Security
representing such series of Debt Securities. Furthermore, if the Company so
specifies with respect to the Debt Securities of a series, an owner of a
beneficial interest in a Global Security representing Debt Securities of such
series may, on terms acceptable to the Company, the Trustee, and the
Depositary for such Global Security, receive individual Debt Securities of
such series in exchange for such beneficial interests, subject to any
limitations described in the Prospectus Supplement relating to such Debt
Securities. In any such instance, an owner of a beneficial interest in a
Global Security will be entitled to physical delivery of individual Debt
Securities of the series represented by such Global Security equal in
principal amount to such beneficial interest and to have such Debt Securities
registered in its name (if the Debt Securities are issuable as Registered
Securities). Individual Debt Securities of such series so issued will be
issued (a) as Registered Securities in denominations, unless otherwise
specified by the Company, of $1,000 and integral multiples thereof if the Debt
Securities are issuable as Registered Securities, (b) as Bearer Securities in
the denomination or denominations specified by the Company if the Debt
Securities are issuable as Bearer Securities or (c) as either Registered
Securities or Bearer Securities as described above if the Debt Securities are
issuable in either form.
Limitations on Issuance of Bearer Securities
The Debt Securities of a series may be issued as Registered Securities
(which will be registered as to principal and interest in the register
maintained by the registrar for such Debt Securities) or Bearer Securities
(which will be transferable only be delivery). If such Debt Securities are
issuable as Bearer Securities, the applicable Prospectus Supplement will
describe certain special limitations and considerations that will apply to
such Debt Securities.
Certain Covenants
Limitation on Secured Debt. The Indenture provides that the Company will
not, and will not permit any Restricted Subsidiary to, become liable for any
indebtedness for borrowed money secured by a mortgage or lien on a Principal
Property or on any shares of stock or indebtedness of any Restricted
Subsidiary ("Secured Debt") or secure the same without making effective
provision for securing the payment of the principal of and interest on the
Debt Securities (and, if the company so elects, any indebtedness ranking
equally with the Debt Securities) equally and ratably with or prior to such
secured indebtedness. This covenant will not apply to debt secured by (a)
mortgages or liens on property, capital stock or indebtedness of any
corporation existing at the time it becomes a subsidiary, (b) mortgages
existing on property at the time of acquisition, purchase money mortgages and
mortgages to secure indebtedness incurred within 180 days after the time of
acquisition thereof to finance the purchase price, (c) mortgages or liens on
unimproved property to finance the cost of improvements to such
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property, (d) mortgages or liens securing indebtedness owed by a Subsidiary
(as defined in the Indenture) to the Company or a wholly owned Restricted
Subsidiary, (e) certain mortgages in favor of governmental entities including
mortgages in connection with industrial revenue financing or (f) extensions,
renewals or replacements of any of the foregoing. Notwithstanding this
covenant, the Company and its Restricted Subsidiaries may incur or guarantee
any Secured Debt, provided that after giving effect thereto the aggregate
amount of such debt then outstanding (not including Secured Debt permitted
under the foregoing exceptions) and the aggregate "value" of Sale and
Leaseback Transactions (as defined below) other than Sale and Leaseback
Transactions permitted under clauses (a) through (d) and (f) in the following
paragraph, at such time does not exceed 10% of Consolidated Net Tangible
Assets (as defined below).
Limitation on Sales and Leasebacks. The Indenture provides that sales and
leasebacks of a Principal Property (as defined below) by the Company or a
Restricted Subsidiary (except those for a temporary period of not more than
three years and those from the Company or a wholly owned Restricted
Subsidiary) will be prohibited unless (a) the transaction is entered into to
finance the cost of acquiring such property or within 180 days after such
acquisition, (b) the transaction is entered into finance the cost of
improvements to such unimproved property, (c) the transaction is one of
certain types in which the lessor is a governmental entity, (d) the
transaction involves the extension, renewal or replacement of the transactions
referred to in clauses (a) through (c) above, (e) the property involved is
property that could be mortgaged without equally and ratably securing the Debt
Securities under the last sentence of the preceding paragraph or (f) an amount
equal to the proceeds of sale or the fair value of the property sold
(whichever is higher) is applied to the retirement of funded debt of the
Company.
A Prospectus Supplement may provide that additional covenants will be
applicable to the Company with respect to the Debt Securities of a series. In
addition, a Prospectus Supplement may provide that a series of Debt Securities
will not have the benefit of the covenants described above.
Definitions. For purposes of the events described above under Certain
Covenants" the following definitions and conventions will apply.
The term "Restricted Subsidiary" means (a) any Subsidiary other than (1) a
Subsidiary the primary business of which consists of one or more of the
following: (i) purchasing amounts receivable, (ii) making loans secured by
accounts receivable or inventories or otherwise providing credit, (iii) making
investment in real estate or providing services directly related thereto or
otherwise engaging in the business of a finance or real estate investment
company, or (iv) leasing equipment, machinery, vehicles, rolling stock and
other articles of use of the business of the Company, or (2) certain named
Subsidiaries; and (b) any Subsidiary described in Clauses (1) or (2) of
paragraph (a) above which at the time of determination shall be a Restricted
Subsidiary pursuant to designation by the Board of Directors hereinafter
provided for.
The Company may by board resolution designate any Unrestricted Subsidiary
(defined as a Subsidiary that is not a Restricted Subsidiary) to be a
Restricted Subsidiary. The Company may by board resolution designate a newly
acquired or formed Subsidiary to be an Unrestricted Subsidiary, provided such
designation takes place not later than 90 days after such acquisition or
formation.
The term "Principal Property" will mean any manufacturing or research
property, plant or facility of the Company or any Restricted Subsidiary except
any property that the Board of Directors by resolution declares is not of
material importance to the total business conducted by the Company and its
Restricted Subsidiaries as an entirety. The term "Consolidated Net Tangible
Assets" will mean at any date the total amount of assets that under generally
accepted accounting principles would be included on a consolidated balance
sheet of the Company and its Restricted Subsidiaries as of such date, less the
sum of the following items, which would then also be so included in accordance
with generally accepted accounting principles: (a) related depreciation,
amortization and other valuation reserves, (b) certain investments, less
applicable reserves in Unrestricted Subsidiaries, (c) all treasury stock,
goodwill, trade names, trademarks, patents, unamortized debt discount and
expense and other like intangibles and (d) all liabilities and liability in
terms of the Company and its Restricted
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Subsidiaries (including minority interests in Restricted Subsidiaries held by
persons other than the Company or wholly owned Restricted Subsidiaries) except
(i) the reserves deducted as described in clauses (a) and (b) above, (ii)
funded debt, (iii) provisions for deferred income taxes and (iv) capital
stock, surplus and surplus reserves.
A Prospectus Supplement may modify or add to the foregoing covenants. In
addition, a Prospectus Supplement may omit some or all of the foregoing
covenants and/or definitions (thereby evidencing the decision by the Company
to not be bound by such covenants and/or definitions).
Subordination
Debt Securities of a series may be subordinated ("Subordinated Debt
Securities") to Senior Indebtedness (as defined in the applicable Prospectus
Supplement) to the extent set forth in the Prospectus Supplement relating
thereto. The Company conducts substantially all its operations through
subsidiaries, and the holders of Debt Securities (whether or not Subordinated
Debt Securities) will be structurally subordinated to the creditors of the
Company's subsidiaries.
Upon any payment or distribution of assets of the Company to creditors or
upon a total or partial liquidation or dissolution of the Company or in a
bankruptcy, receivership, or similar proceeding relating to the Company or its
property, holders of Senior Indebtedness shall be entitled to receive payment
in full in cash of the Senior Indebtedness before holders of Subordinated Debt
Securities shall be entitled to receive any payment of principal, premium, or
interest with respect to the Subordinated Debt Securities, and until the
Senior Indebtedness is paid in full, any distribution to which holders of
Subordinated Debt Securities would otherwise be entitled shall be made to the
holders of Senior Indebtedness (except that such holders may receive shares of
stock and any debt securities that are subordinated to Senior Indebtedness to
at least the same extent as the Subordinated Debt Securities).
The Company may not make any payments of principal, premium, or interest
with respect to Subordinated Debt Securities, make any deposit for the purpose
of defeasance of such Subordinated Debt Securities, or repurchase, redeem, or
otherwise retire (except, in the case of Subordinated Debt Securities that
provide for a mandatory sinking fund, by the delivery of Subordinated Debt
Securities by the Company to the Trustee in satisfaction of the Company's
sinking fund obligation) any Subordinated Debt Securities if (a) any
principal, premium or interest with respect to Senior Indebtedness is not paid
in full in cash within any applicable grace period (including at maturity) or
(b) any other default on Senior Indebtedness occurs and the maturity of such
Senior Indebtedness is accelerated in accordance with its terms, unless, in
either case, the default has been cured or waived and such acceleration has
been rescinded, such Senior Indebtedness has been paid in full in cash or the
Company and the Trustee receive written notice approving such payment from the
representatives of such Senior Indebtedness. During the continuance of any
default (other than a default described in clause (a) or (b) above) with
respect to any Designated Senior Indebtedness (as defined in the applicable
Prospectus Supplement) pursuant to which the maturity thereof may be
accelerated immediately without further notice (except such notice as may be
required to effect such acceleration) or the expiration of any applicable
grace periods, the Company may not pay the Subordinated Debt Securities for a
period (the "Payment Blockage Period") commencing on the receipt by the
Company and the Trustee of written notice of such default from the
representative of any Designated Senior Indebtedness specifying an election to
effect a Payment Blockage Period (a "Blockage Notice"). The Payment Blockage
Period may be terminated before its expiration by written notice to the
Trustee and the Company from the person who gave the Blockage Notice, by
repayment in full in cash of the Senior Indebtedness with respect to which the
Blockage Notice was given or because the default giving rise to the Payment
Blockage Period is no longer continuing. Unless the holders of such Designated
Senior Indebtedness shall have accelerated the maturity thereof, the Company
may resume payments on the Subordinated Debt Securities after the expiration
of the Payment Blockage Period. Not more than one Blockage Notice may be given
in any period of 360 consecutive days. In no event, however, may the total
number of days during which any Payment Blockage Period or Periods is in
effect exceed 179 days in the aggregate during any period of 360 consecutive
days. After all Senior Indebtedness is paid in full and until the Subordinated
Debt Securities are paid in full, holders of the Subordinated Debt Securities
shall be subrogated to the rights of holders of Senior Indebtedness to receive
distributions applicable to Senior Indebtedness.
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By reason of such subordination, in the event of insolvency, creditors of
the Company who are holders of Senior Indebtedness, as well as certain general
creditors of the Company, may recover more, ratably, than the holders of the
Subordinated Debt Securities.
Events of Default and Remedies
The following events are defined in the Indenture as "Events of Default"
with respect to a series of Debt Securities:
(a) default in the payment of any installment of interest on any Debt
Securities of that series or any payment with respect to the related
coupons, if any, as and when the same shall become due and payable (whether
or not, in the case of Subordinated Debt Securities, such payment shall be
prohibited by reason of the subordination provisions described above) and
continuance of such default for a period of 30 days;
(b) default in the payment of principal or premium with respect to any
Debt Securities of that series as and when the same shall become due and
payable, whether at maturity, upon redemption, by declaration, upon
required repurchase, or otherwise (whether or not, in the case of
Subordinated Debt Securities, such payment shall be prohibited by reason of
the subordination provisions described above);
(c) default in the payment of any sinking fund payment with respect to
any Debt Securities of that series as and when the same shall become due
and payable;
(d) failure on the part of the Company to comply with the provisions of
the Indenture relating to consolidations, mergers, and sales of assets;
(e) failure on the part of the Company duly to observe or perform any
other of the covenants or agreements on the part of the Company in the Debt
Securities of that series, in any resolution of the Board of Directors of
the Company authorizing the issuance of that series of Debt Securities, in
the Indenture with respect to such series, or in any supplemental Indenture
with respect to such series (other than a covenant a default in the
performance of which is otherwise specifically dealt with) continuing for a
period of 60 days after the date on which written notice specifying such
failure and requiring the Company to remedy the same shall have been given
to the Company by the Trustee or to the Company and the Trustee by the
holders of at least 25% in aggregate principal amount of the Debt
Securities of that series at the time outstanding;
(f) indebtedness of the Company or any subsidiary of the Company is not
paid within any applicable grace period after final maturity or is
accelerated by the holders thereof because of a default, the total amount
of such Indebtedness unpaid or accelerated exceeds $20 million or the
United States dollar equivalent thereof at the time, and such default
remains uncured or such acceleration is not rescinded for 10 days after the
date on which written notice specifying such failure and requiring the
Company to remedy the same shall have been given to the Company by the
Trustee or to the Company and the Trustee by the holders of at least 25% in
aggregate principal amount of the Debt Securities of that series at the
time outstanding;
(g) the Company or any of its "Significant Subsidiaries" (defined as any
subsidiary of the Company that would be a "significant subsidiary" as
defined in Rule 405 under the Securities Act as in effect on the date of
the Indenture) shall (1) voluntarily commence any proceeding or file any
petition seeking relief under the United States Bankruptcy Code or other
federal, state or foreign bankruptcy, insolvency or similar law, (2)
consent to the institution of, or fail to controvert within the time and in
the manner prescribed by law, any such proceeding or the filing of any such
petition, (3) apply for or consent to the appointment of a receiver,
trustee, custodian, sequestrator or similar official for the Company or any
such Significant Subsidiary or for a substantial part of its property, (4)
file an answer admitting the material allegations of a petition filed
against it in any such proceeding, (5) make a general assignment for the
benefit of creditors, (6) admit in writing its inability or fail generally
to pay its debts as they become due, (7) take corporate action for the
purpose of effecting any of the foregoing or (8) take any comparable action
under any foreign laws relating to insolvency;
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(h) the entry of an order or decree by a court having competent
jurisdiction for (1) relief with respect to the Company or any of its
Significant Subsidiaries or a substantial part of any of their property
under the United States Bankruptcy Code or any other federal, state or
foreign bankruptcy, insolvency or similar law, (2) the appointment of a
receiver, trustee, custodian, sequestrator or similar official for the
Company or any such Significant Subsidiary or for a substantial part of any
of their property (except any decree or order appointing such official of
any Significant Subsidiary pursuant to a plan under which the assets and
operations of such Significant Subsidiary are transferred to or combined
with another Significant Subsidiary or Subsidiaries of the Company or to
the Company) or (3) the winding-up or liquidation of the Company or any
such Significant Subsidiary (except any decree or order approving or
ordering the winding-up or liquidation of the affairs of a Significant
Subsidiary pursuant to a plan under which the assets and operations of such
Significant Subsidiary are transferred to or combined with another
Significant Subsidiary or Subsidiaries of the Company or to the Company),
and such order or decree shall continue unstayed and in effect for 60
consecutive days, or any similar relief is granted under any foreign laws
and the order or decree stays in effect for 60 consecutive days;
(i) any judgment or decree for the payment of money in excess of $20
million or the United States dollar equivalent thereof at the time is
entered against the Company or any Significant Subsidiary of the Company by
a court of competent jurisdiction, which judgment is not covered by
insurance, and is not discharged and either (1) an enforcement proceeding
has been commenced by any creditor upon such judgment or decree or (2)
there is a period of 60 days following the entry of such judgment or decree
during which such judgment or decree is not discharged or waived or the
execution thereof stayed and, in either case, such default continues for 10
days after the date on which written notice specifying such failure and
requiring the Company to remedy the same shall have been given to the
Company by the Trustee or to the Company and the Trustee by the holders of
at least 25% in aggregate principal amount of the Debt Securities of that
series at the time outstanding; and
(j) any other Event of Default provided with respect to Debt Securities
of that series.
An Event of Default with respect to one series of Debt Securities is not
necessarily an Event of Default for another series.
A Prospectus Supplement may omit, modify or add to the foregoing Events of
Default.
If an Event of Default described in clause (a), (b), (c), (d), (e), (f), (i)
or (j) above occurs and is continuing with respect to any series of Debt
Securities, unless the principal and interest with respect to all the Debt
Securities of such series shall have already become due and payable, either
the Trustee or the holders not less than 25% in aggregate principal amount of
the Debt Securities of such series then outstanding may declare the principal
amount (or, if Original Issue Discount Debt Securities, such portion of the
principal amount as may be specified in such series) of and interest on all
the Debt Securities of such series due and payable immediately. If an Event of
Default described in clause (g) or (h) above occurs, unless the principal and
interest with respect to all the Debt Securities of all series shall have
become due and payable, the principal amount (or, if any series are Original
Issue Discount Debt Securities, such portion of the principal amount as may be
specified in such series) of and interest on all Debt Securities of all series
then outstanding shall become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any holder of Debt
Securities.
If an Event of Default occurs and is continuing, the Trustee shall be
entitled and empowered to institute any action or proceeding for the
collection of the sums so due and unpaid or to enforce the performance of any
provision of the Debt Securities of the affected series or the Indenture, to
prosecute any such action or proceeding to judgment or final decree, and to
enforce any such judgment or final decree against the Company or any other
obligor on the Debt Securities of such series. In addition, if there shall be
pending proceedings for the bankruptcy or reorganization of the Company or any
other obligor on the Debt Securities, or if a receiver, trustee, or similar
official shall have been appointed for its property, the Trustee shall be
entitled and empowered to file and prove a claim for the whole amount of
principal, premium, and interest (or, in the case of Original Issue Discount
Debt
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Securities, such portion of the principal amount as may be specified in the
terms of such series) owing and unpaid with respect to the Debt Securities. No
holder of any Debt Security or coupon of any series shall have any right to
institute any action or proceeding upon or under or with respect to the
Indenture, for the appointment of a receiver or trustee, or for any other
remedy, unless (a) such holder previously shall have given to the Trustee
written notice of an Event of Default with respect to Debt Securities of that
series and of the continuance thereof, (b) the holders of not less than 25% in
aggregate principal amount of the outstanding Debt Securities of that series
shall have made written request to the Trustee to institute such action or
proceeding with respect to such Event of Default and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs,
expenses, and liabilities to be incurred therein or thereby, and (c) the
Trustee, for 60 days after its receipt of such notice, request, and offer of
indemnity shall have failed to institute such action or proceeding and no
direction inconsistent with such written request shall have been given to the
Trustee pursuant to the provisions of the Indenture.
Prior to the acceleration of the maturity of the Debt Securities of any
series, the holders of a majority in aggregate principal amount of the Debt
Securities of that series at the time outstanding may, on behalf of the
holders of all Debt Securities and any related coupons of that series, waive
any past default or Event of Default and its consequences for that series,
except (a) a default in the payment of the principal, premium, or interest
with respect to such Debt Securities or (b) a default with respect to a
provision of the Indenture that cannot be amended without the consent of each
holder affected thereby. In case of any such waiver, such default shall cease
to exist, any Event of Default arising therefrom shall be deemed to have been
cured for all purposes, and the Company, the Trustee and the holders of the
Debt Securities of that series shall be restored to their former positions and
rights under the Indenture.
The Trustee shall, within 90 days after the occurrence of a default known to
it with respect to a series of Debt Securities, give to the holders of the
Debt Securities of such series notice of all uncured defaults with respect to
such series known to it, unless such defaults shall have been cured or waived
before the giving of such notice; provided, however, that except in the case
of default in the payment of principal, premium, or interest with respect to
the Debt Securities of such series or in the making of any sinking fund
payment with respect to the Debt Securities of such series, the Trustee shall
be protected in withholding such notice if it in good faith determines that
the withholding of such notice is in the interest of the holders of such Debt
Securities.
Modification of the Indenture
The Company and the Trustee may enter into supplemental Indentures without
the consent of the Holders of Debt Securities for one or more of the following
purposes:
(a) to evidence the succession of another person to the Company pursuant
to the provisions of the Indenture relating to consolidations, mergers and
sales of assets and the assumption by such successor of the covenants,
agreements and obligations of the Company in the Indenture and in the Debt
Securities;
(b) to surrender any right or power conferred upon the Company by the
Indenture, to add to the covenants of the Company such further covenants,
restrictions, conditions or provisions for the protection of the holders of
all or any series of Debt Securities as the Board of Directors of the
Company shall consider to be for the protection of the holders of such Debt
Securities, and to make the occurrence, or the occurrence and continuance,
of a default in any of such additional covenants, restrictions, conditions
or provisions a default or an Event of Default under the Indenture
(provided, however, that with respect to any such additional covenant,
restriction, condition or provision, such supplemental Indenture may
provide for a period of grace after default, which may be shorter or longer
than that allowed in the case of other defaults, may provide for an
immediate enforcement upon such default, may limit the remedies available
to the Trustee upon such default or may limit the right of holders of a
majority in aggregate principal amount of any or all series of Debt
Securities to waive such default);
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(c) to cure any ambiguity or to correct or supplement any provision
contained in the Indenture, in any supplemental Indenture or in any Debt
Securities that may be defective or inconsistent with any other provision
contained therein, to convey, transfer, assign, mortgage or pledge any
property to or with the Trustee, or to make such other provisions in regard
to matters or questions arising under the Indenture as shall not adversely
affect the interests of any holders of Debt Securities of any series;
(d) to modify or amend the Indenture in such a manner as to permit the
qualification of the Indenture or any supplemental Indenture under the
Trust Indenture Act as then in effect;
(e) to add to or change any of the provisions of the Indenture to provide
that Bearer Securities may be registerable as to principal, to change or
eliminate any restrictions on the payment of principal or premium with
respect to Registered Securities or of principal, premium or interest with
respect to Bearer Securities, or to permit Registered Securities to be
exchanged for Bearer Securities, so long as any such action does not
adversely affect the interests of the holders of Debt Securities or any
coupons of any series in any material respect or permit or facilitate the
issuance of Debt Securities of any series in uncertificated form;
(f) to comply with the provisions of the Indenture relating to
consolidations, mergers and sales of assets;
(g) in the case of Subordinated Debt Securities, to make any change in
the provisions of the Indenture relating to subordination that would limit
or terminate the benefits available to any holder of Senior Indebtedness
under such provisions (but only if each such holder of Senior Indebtedness
consents to such change);
(h) to add guarantees with respect to the Debt Securities or to secure
the Debt Securities;
(i) to make any change that does not adversely affect the rights of any
holder;
(j) to add to change, or eliminate any of the provisions of the Indenture
with respect to one or more series of Debt Securities, so long as any such
addition, change or elimination not otherwise permitted under the Indenture
shall (1) neither apply to any Debt Security of any series created prior to
the execution of such supplemental Indenture and entitled to the benefit of
such provision nor modify the rights of the holders of any such Debt
Security with respect to such provision or (2) become effective only when
there is no such Debt Security outstanding;
(k) to evidence and provide for the acceptance of appointment by a
successor or separate Trustee with respect to the Debt Securities of one or
more series and to add to or change any of the provisions of the Indenture
as shall be necessary to provide for or facilitate the administration of
the Indenture by more than one Trustee; and
(l) to establish the form or terms of Debt Securities and coupons of any
series, as described under "Description of Debt Securities--General" above.
With the consent of the holders of a majority in aggregate principal amount
of the outstanding Debt Securities of each series affected thereby, the
Company and the Trustee may from time to time and at any time enter into a
supplemental Indenture for the purpose of adding any provisions to, changing
in any manner or eliminating any of the provisions of the Indenture or of any
supplemental Indenture or modifying in any manner the rights of the holder of
the Debt Securities of such series; provided, however, that without the
consent of the holders of each Debt Security so affected, no such supplemental
Indenture shall (a) reduce the percentage in principal amount of Debt
Securities of any series whose holders must consent to an amendment, (b)
reduce the rate of or extend the time for payment of interest on any Debt
Security or coupon or reduce the amount of any payment to be made with respect
to any coupon, (c) reduce the principal of or extend the stated maturity of
any Debt Security, (d) reduce the premium payable upon the redemption of any
Debt Security or change the time at which any Debt Security may or shall be
redeemed, (e) make any Debt Security payable in a currency other than that
stated in the Debt Security, (f) in the case of any Subordinated Debt Security
or coupons appertaining thereto, make any change in the provisions of the
Indenture relating to subordination that adversely affects the
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rights of any holder under such provisions, (g) release any security that may
have been granted with respect to the Debt Securities, (h) make any change in
the provisions of the Indenture relating to waivers of defaults or amendments
that require unanimous consent, (i) change any obligation of the Company
provided for in the Indenture to pay additional interest with respect to
Bearer Securities or (j) limit the obligation of the Company to maintain a
paying agency outside the United States for payment on Bearer Securities or
limit the obligation of the Company to redeem certain Bearer Securities.
Consolidation, Merger, and Sale of Assets
The Company may not consolidate with or merge with or into any person, or
convey, transfer or lease all or substantially all of its assets, unless the
following conditions have been satisfied:
(a) either (1) the Company shall be the continuing person in the case of
a merger or (2) the resulting, surviving, or transferee person, if other
than the Company (the "Successor Company"), shall be a corporation
organized and existing under the laws of the United States, any State
thereof, or the District of Columbia and shall expressly assume all of the
obligations of the Company under the Debt Securities and coupons and the
Indenture;
(b) immediately after giving effect to such transaction (and treating any
indebtedness that becomes an obligation of the Successor Company or any
subsidiary of the Company as a result of such transaction as having been
incurred by the Successor Company or such subsidiary at the time of such
transaction), no Default or Event of Default would occur or be continuing;
(c) the Successor Company waives any right to redeem any Bearer Security
under circumstances in which the Successor Company would be entitled to
redeem such Bearer Security but the Company would not have been so entitled
to redeem if the consolidation, merger, conveyance, transfer or lease had
not occurred; and
(d) the Company shall have delivered to the Trustee an officers'
certificate and an opinion of counsel, each stating that such
consolidation, merger or transfer complies with the Indenture.
Satisfaction and Discharge of the Indenture; Defeasance
The Indenture shall generally cease to be of any further effect with respect
to a series of Debt Securities if (a) the Company has delivered to the Trustee
for cancelation all Debt Securities of such series (with certain limited
exceptions) or (b) all Debt Securities and coupons of such series not
theretofore delivered to the Trustee for cancelation shall have become due and
payable, or are by their terms to become due and payable within one year or
are to be called for redemption within one year, and the Company shall have
deposited with the Trustee as trust funds the entire amount sufficient to pay
at maturity or upon redemption all such Debt Securities and coupons (and if,
in either case, the Company shall also pay or cause to be paid all other sums
payable under the Indenture by the Company).
In addition, the Company shall have a "legal defeasance option" (pursuant to
which it may terminate, with respect to the Debt Securities of a particular
series, all of its obligations under such Debt Securities and the Indenture
with respect to such Debt Securities) and a "covenant defeasance option"
(pursuant to which it may terminate, with respect to the Debt Securities of a
particular series, its obligations with respect to such Debt Securities under
certain specified covenants contained in the Indenture). If the Company
exercises its legal defeasance option with respect to a series of Debt
Securities, payment of such Debt Securities may not be accelerated because of
an Event of Default. If the Company exercises its covenant defeasance option
with respect to a series of Debt Securities, payment of such Debt Securities
may not be accelerated because of an Event of Default related to the specified
covenants.
The applicable Prospectus Supplement will describe the procedures the
Company must follow in order to exercise its defeasance options.
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The Trustee
The Company may appoint a separate Trustee for any series of Debt
Securities. As used herein in the description of a series of Debt Securities,
the term "Trustee" refers to the Trustee appointed with respect to such series
of Debt Securities.
The Company may maintain banking and other commercial relationships with the
Trustee and its affiliates in the ordinary course of business, and the Trustee
may own Debt Securities.
DESCRIPTION OF CAPITAL STOCK
General
The following summary of certain provisions of the Company's capital stock
does not purport to be complete and is subject to, and qualified in its
entirety by, the provisions of the Company's Certificate of Incorporation (the
"Certificate of Incorporation"), which is included as an exhibit to the
Registration Statement of which this Prospectus is a part, and by the
provisions of applicable law.
Common Stock
The Company's Certificate of Incorporation authorizes the issuance of up to
30,000,000 shares of Common Stock, $.01 par value per share. Holders of Common
Stock are entitled to one vote for each share held on all matters submitted to
a vote of stockholders and do not have cumulative voting rights. Accordingly,
holders of a majority of the shares of Common Stock entitled to vote in any
election of directors may elect all of the directors standing for election.
Holders of Common Stock are entitled to receive ratably such dividends, if
any, as may be declared by the Board of Directors out of funds legally
available therefor, subject to any preferential dividend rights of outstanding
Preferred Stock. Upon the liquidation, dissolution or winding up of the
Company, the holders of Common Stock are entitled to receive ratably the net
assets of the Company available after the payment of all debts and other
liabilities and subject to the prior rights of any outstanding Preferred
Stock. Holders of Common Stock have no preemption, subscription, redemption or
conversion rights. The outstanding shares of Common Stock are fully paid and
nonassessable. The rights, preferences and privileges of holders of Common
Stock are subject to, and may be adversely affected by, the rights of the
holders of shares of any series of Preferred Stock which the Company may
designate and issue in the future.
The outstanding shares of Common Stock are listed on the NASDAQ and trade
under the symbol "CHRX."
The transfer agent and registrar for the Common Stock is Boston EquiServe
L.P., an affiliate of The First National Bank of Boston.
Preferred Stock
The following description of the terms of the Preferred Stock sets forth
certain general terms and provisions of the Preferred Stock to which a
Prospectus Supplement may relate. Specific terms of any series of Preferred
Stock offered by a Prospectus Supplement will be described in the Prospectus
Supplement relating to such series. The description set forth below is subject
to and qualified in its entirety by reference to the certificate of
designations establishing a particular series of Preferred Stock, which will
be filed with the SEC in connection with the offering of such series.
The Certificate of Incorporation authorizes the issuance of up to 4,000,000
shares of Preferred Stock, $.01 par value per share. Under the terms of the
Certificate of Incorporation, the Board of Directors is authorized, subject to
any limitations prescribed by law, without stockholder approval, to issue such
shares of Preferred Stock in one or more series. Each such series of Preferred
Stock shall have such rights, preferences, privileges and restrictions,
including voting rights, dividend rights, conversion rights, redemption
privileges and liquidation
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preferences, as shall be determined by the Board of Directors. Accordingly,
the Board of Directors, without stockholder approval, may issue undesignated
stock with terms that could adversely affect the voting power and other rights
of holders of Common Stock.
The existence of undesignated preferred stock may have the effect of
discouraging attempts to acquire control of the Company with a view to
effecting a merger, sale or exchange of assets or a similar transaction. The
anti-takeover effects of the undesignated shares may deny stockholders the
opportunity to receive a premium on their stock and may also have a depressive
effect on the market price of the Common Stock.
The transfer agent, registrar, and dividend disbursement agent for a series
of Preferred Stock will be selected by the Company and will be described in
the applicable Prospectus Supplement. The registrar for shares of Preferred
Stock will send notices to stockholders of any meetings at which holders of
the Preferred Stock have the right to elect directors of the Company or to
vote on any other matter.
Rights Plan
Rights
The Board of Directors of the Company, pursuant to a stockholders rights
plan (the "Rights Plan") has declared a dividend of one right (the "Rights")
for each outstanding share of Common Stock. The Rights were issued to the
holders of record of Common Stock outstanding on the Rights issuance date, and
with respect to Common Stock issued thereafter until the Distribution Date (as
defined below), and, in certain circumstances, with respect to Common Stock
issued after the Distribution Date. Each Right, when it becomes exercisable as
described below, will entitle the registered holder to purchase from the
Company one one-thousandth (1/1000th) of a share of Preferred Stock (the
"Preferred Shares") at a price of $50 per (1/1000th) of a share, subject to
adjustment in certain circumstances (the "Purchase Price"). The description
and terms of the Rights are set forth in a Rights Agreement (the "Rights
Agreement") between the Company and the Rights Agent named therein. The Rights
will not be exercisable until the Distribution Date and will expire on the
tenth annual anniversary of the Rights Agreement (the "Expiration Date"),
unless earlier redeemed by the Company. Until a Right is exercised, the holder
thereof, as such, will have no rights as a stockholder of the Company,
including, without limitation, the right to vote or to receive dividends with
respect to the Rights of the Preferred Shares relating thereto.
Distribution Date
Under the Rights Agreement, the Distribution Date is the earlier of (i) such
time as the Company learns that a person or group (including any affiliate or
associate of such person or group) has acquired, or has obtained the right to
acquire, beneficial ownership of more than 15% of the outstanding shares of
Common Stock (such person or group being an "Acquiring Person"), unless
provisions preventing accidental triggering of the distribution of the Rights
apply, and (ii) the close of business on such date, if any, as may be
designated by the Board of Directors following the commencement of, or first
public disclosure of an intent to commence, a tender or exchange offer for
more than 15% or more of the outstanding shares of Common Stock.
Triggering Event and Effect of Triggering Event
At such time as there is an Acquiring Person, the Rights will entitle each
holder (other than such Acquiring Person) of a Right to purchase, for the
Purchase Price, that number of one one-thousandths (1/1000ths) of a Preferred
Share equivalent to the number of shares of Common Stock which at the time of
such event would have a market value of twice the Purchase Price.
In the event the Company is acquired in a merger or other business
combination by an Acquiring Person or an affiliate or associate of an
Acquiring Person that is a publicly traded corporation or 50% or more of the
Company's assets or assets representing 50% or more of the Company's revenues
or cash flow are sold, leased, exchanged or otherwise transferred (in one or
more transactions) to an Acquiring Person or an affiliate or
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associate of an Acquiring Person, each Right will entitle its holder (other
than Rights beneficially owned by such Acquiring Person or its affiliates or
associates) to purchase, for the Purchase Price, that number of common shares
of such corporation (or, if such corporation is not a publicly traded
corporation, that number of common shares of an affiliate of such corporation
that has publicly traded shares) which at the time of the transaction would
have a market value or, in certain circumstances, book value of twice the
Purchase Price.
Redemption
At any time prior to the earlier of (i) such time as a person or group
becomes an Acquiring Person and (ii) the Expiration Date, the Board of
Directors may redeem the Rights in whole, but not in part, at a price (in cash
or Common Stock or other securities of the Company deemed by the Board of
Directors to be at least equivalent in value) of $.10 per Right (which amount
shall be subject to adjustment as provided in the Rights Agreement) (the
"Redemption Price"). Immediately upon the action of the Board of Directors
ordering the redemption of the Rights, and without any further action and
without any notice, the right to exercise the Rights will terminate and the
only right of the holders of Rights will be to receive the Redemption Price.
In addition, at any time after there is an Acquiring Person, the Board of
Directors may elect to exchange each Right for consideration per Right
consisting of one-half of the securities that would be issuable at such time
upon exercise of one Right pursuant to the terms of the Rights Agreement.
Amendment
At any time prior to the Distribution Date, the Company may, without the
approval of any holder of any Rights, supplement or amend any provision of the
Rights Agreement (including, without limitation, the date on which the
Distribution Date shall occur, the definition of Acquiring Person, the time
during which the Rights may be redeemed or the terms of the Preferred Shares),
except that no supplement or amendment shall be made which reduces the
Redemption Price (other than pursuant to certain adjustments therein) or
provides for an earlier Expiration Date.
Certain Effects of the Rights Plan
The Rights Plan is designed to protect stockholders of the Company in the
event of unsolicited offers to acquire the Company and other coercive takeover
tactics which, in the opinion of the Board of Directors, could impair its
ability to represent stockholder interests. The provisions of the Rights Plan
may render an unsolicited takeover of the Company more difficult or less
likely to occur or might prevent such a takeover, even though such takeover
may offer the Company's stockholders the opportunity to sell their stock at a
price above the prevailing market rate and may be favored by a majority of the
stockholders of the Company.
Delaware Law and Certain Charter and By-Law Provisions
The Company is subject to the provisions of Section 203 of the General
Corporation Law of Delaware. Section 203 prohibits a publicly held Delaware
corporation from engaging in a "business combination" with an "interested
stockholder" for a period of three years after the date of the transaction in
which the person became an interested stockholder, unless the business
combination is approved in a prescribed manner. A "business combination"
includes mergers, asset sales and other transactions resulting in a financial
benefit to the interested stockholder. Subject to certain exceptions, an
"interested stockholder" is a person who, together with affiliates and
associates, owns, or within three years did own, 15% or more of the
corporation's voting stock.
The Company's Amended and Restated By-Laws (the "Amended and Restated By-
Laws") provide for the division of the Board of Directors into three classes
as nearly equal in size as possible with staggered three-year terms. In
addition, the Amended and Restated By-Laws provide that directors may be
removed only for cause by the affirmative vote of the holders of two-thirds of
the shares of capital stock of the corporation entitled to vote. Under the
Company's Amended and Restated By-Laws, any vacancy on the Board of Directors,
however
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occurring, including a vacancy resulting from an enlargement of the Board, may
be filled only by vote of a majority of the directors then in office. The
classification of the Board of Directors and the limitations on the removal of
directors and filling of vacancies could have the effect of making it more
difficult for a third party to acquire, or of discouraging a third party from
acquiring, control of the Company.
The Company's Amended and Restated By-Laws also provide that any action
required or permitted to be taken by the stockholders of the Company at an
annual meeting or special meeting of stockholders may be taken only if it is
properly brought before such meeting and may not be taken by written action in
lieu of a meeting. For business to be properly brought before an annual
meeting by a stockholder, the stockholder must give written notice thereof to
the Secretary of the Company, subject to certain exceptions, not less than 70
days nor more than 90 days prior to the anniversary date of the previous
annual meeting. In addition, the Amended and Restated By-Laws provide that the
Company need not present a stockholder proposal which was otherwise submitted
properly, if such stockholder or its representative does not appear to present
such proposal at the annual meeting. The Amended and Restated By-Laws further
provide that special meetings of the stockholders may only be called by the
Chairman of the Board of Directors, the Chief Executive Officer or the
President of the Company or by the Board of Directors. Under the Company's
Amended and Restated By-Laws, in order for any matter to be considered
"properly brought" before a meeting, a stockholder must comply with certain
other requirements regarding notice to the Company. The foregoing provisions
could have the effect of delaying until the next stockholders meeting
stockholder actions which are favored by the holders of a majority of the
outstanding voting securities of the Company. These provisions may also
discourage another person or entity from making a tender offer for the Common
Stock, because such person or entity, even if acquired a majority of the
outstanding voting securities of the Company, would be able to take action as
a stockholder (such as electing new directors or approving a merger) only at a
duly called stockholders meeting, and not by written consent.
The General Corporation Law of Delaware provides generally that the
affirmative vote of a majority of the shares entitled to vote on any matter is
required to amend a corporation's Certificate of Incorporation or By-Laws,
unless a corporation's Certificate of Incorporation or By-Laws, as the case
may be, requires a greater percentage. The Company's Amended and Restated By-
Laws require the affirmative vote of the holders of at least 75% of the shares
of capital stock of the Company issued and outstanding and entitled to vote to
amend or repeal any of the provisions described in the prior two paragraphs.
The Company's Certificate of Incorporation contains certain provisions
permitted under the General Corporation Law of Delaware relating to the
liability of directors. These provisions eliminate a director's liability for
monetary damages for a breach of fiduciary duty, except in certain
circumstances involving wrongful acts, such as the breach of a director's duty
of loyalty or acts or omissions which involve intentional misconduct or a
knowing violation of law. Further, the Company's Certificate of Incorporation
contains provisions to indemnify the Company's directors and officers to the
fullest extent permitted by the General Corporation Law of Delaware. The
Company believes that these provisions will assist the Company in attracting
and retaining qualified individuals to serve as directors.
DESCRIPTION OF DEPOSITARY SHARES
The description set forth below and in any Prospectus Supplement of certain
provisions of the Deposit Agreement (as defined below) and of the Depositary
Shares (as defined below) and Depositary Receipts (as defined below) does not
purport to be complete and is subject to and qualified in its entirety by
reference to the forms of Deposit Agreement and Depositary Receipts relating
to each series of Preferred Stock that will be filed with the SEC in
connection with the offering of such series of Preferred Stock.
General
The Company may, at its option, elect to offer fractional interests in
shares of Preferred Stock, rather than shares of Preferred Stock. In the event
such option is exercised, the Company will provide for the issuance by a
depositary to the public of receipts for depositary shares ("Depositary
Shares"), each of which will represent
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fractional interests of a particular series of Preferred Stock (which will be
set forth in the Prospectus Supplement relating to a particular series of
Preferred Stock).
The shares of any series of Preferred Stock underlying the Depositary Shares
will be deposited under a separate Deposit Agreement (the "Deposit Agreement")
between the Company and a bank or trust company selected by the Company having
its principal office in the United States and having a combined capital and
surplus of at least $50 million. The Prospectus Supplement relating to a
series of Depositary Shares will set forth the name and address of the
depositary with respect to such Depositary Shares. Subject to the terms of the
Deposit Agreement, each owner of Depositary Shares will be entitled, in
proportion to the applicable fractional interests in shares of Preferred Stock
underlying such Depositary Shares, to all the rights and preferences of the
Preferred Stock underlying such Depositary Shares (including dividend, voting,
redemption, conversion, and liquidation rights).
The Depositary Shares will be evidenced by depositary receipts issued
pursuant to the Deposit Agreement (the "Depositary Receipts"). Depositary
Receipts will be distributed to those persons purchasing the fractional
interests in shares of the related series of Preferred Stock in accordance
with the terms of the offering described in the related Prospectus Supplement.
Dividends and Other Distributions
The depositary will distribute all cash dividends or other cash
distributions received with respect to Preferred Stock to the record holders
of Depositary Shares relating to such Preferred Stock in proportion to the
numbers of such Depositary Shares owned by such holders on the relevant record
date. The depositary shall distribute only such amount, however, as can be
distributed without attributing to any holder of Depositary Shares a fraction
of one cent, and the balance not so distributed shall be added to and treated
as part of the next sum received by the depositary for distribution to record
holders of Depositary Shares.
In the event of a distribution other than in cash, the depositary will
distribute property received by it to the record holders of Depositary Shares
entitled thereto, unless the depositary determines that it is not feasible to
make such distribution, in which case the depositary may, with the approval of
the Company, sell such property and distribute the net proceeds from such sale
to such holders.
The Deposit Agreement will also contain provisions relating to the manner in
which any subscription or similar rights offered by the Company to holders of
the Preferred Stock shall be made available to the holders of Depositary
Shares.
Redemption of Depositary Shares
If a series of the Preferred Stock underlying the Depositary Shares is
subject to redemption, the Depositary Shares will be redeemed from the
proceeds received by the depositary resulting from the redemption, in whole or
in part, of such series of the Preferred Stock held by the depositary. The
depositary shall mail notice of redemption not less than 30 and not more than
60 days prior to the date fixed for redemption to the record holders of the
Depositary Shares to be so redeemed at their respective addresses appearing in
the depositary's books. The redemption price per Depositary Share will be
equal to the applicable fraction of the redemption price per share payable
with respect to such series of the Preferred Stock. Whenever the Company
redeems shares of Preferred Stock held by the depositary, the depositary will
redeem as of the same redemption date the number of Depositary Shares relating
to shares of Preferred Stock so redeemed. If less than all the Depositary
Shares are to be redeemed, the Depositary Shares to be redeemed will be
selected by lot or pro rata as may be determined by the depositary.
After the date fixed for redemption, the Depositary Shares so called for
redemption will no longer be outstanding and all rights of the holders of the
Depositary Shares will cease, except the right to receive the money,
securities, or other property payable upon such redemption and any money,
securities, or other property to which the holders of such Depositary Shares
were entitled upon such redemption upon surrender to the depositary of the
Depositary Receipts evidencing such Depositary Shares.
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Voting the Preferred Stock
Upon receipt of notice of any meeting at which the holders of the Preferred
Stock are entitled to vote, the depositary will mail the information contained
in such notice of meeting to the record holders of the Depositary Shares
relating to such Preferred Stock. Each record holder of such Depositary Shares
on the record date (which will be the same date as the record date for the
Preferred Stock) will be entitled to instruct the depositary as to the
exercise of the voting rights pertaining to the number of shares of Preferred
Stock underlying such holder's Depositary Shares. The depositary will
endeavor, insofar as practicable, to vote the number of shares of Preferred
Stock underlying such Depositary Shares in accordance with such instructions,
and the Company will agree to take all action that may be deemed necessary by
the depositary in order to enable the depositary to do so.
Amendment and Termination of Depositary Agreement
The form of Depositary Receipt evidencing the Depositary Shares and any
provision of the Deposit Agreement may at any time be amended by agreement
between the Company and the depositary. However, any amendment that materially
and adversely alters the rights of the existing holders of Depositary Shares
will not be effective unless such amendment has been approved by the record
holders of at least a majority of the Depositary Shares then outstanding. A
Deposit Agreement may be terminated by the Company or the depositary only if
(a) all outstanding Depositary Shares relating thereto have been redeemed or
(b) there has been a final distribution with respect to the Preferred Stock of
the relevant series in connection with any liquidation, dissolution, or
winding up of the Company and such distribution has been distributed to the
holders of the related Depositary Shares.
Charges of Depositary
The Company will pay all transfer and other taxes and governmental charges
arising solely from the existence of the depositary arrangements. The Company
will pay charges of the depositary in connection with the initial deposit of
the Preferred Stock and any redemption of the Preferred Stock. Holders of
Depositary Shares will pay transfer and other taxes and governmental charges
and such other charges as are expressly provided in the Deposit Agreement to
be for their accounts.
Resignation and Removal of Depositary
The depositary may resign at any time by delivering to the Company notice of
its election to do so, and the Company may at any time remove the depositary,
any such designation or removal to take effect upon the appointment of a
successor depositary and its acceptance of such appointment. Such successor
depositary must be appointed within 60 days after delivery of the notice of
resignation or removal and must be a bank or trust company having its
principal office in the United States and having a combined capital and
surplus of at least $50 million.
Miscellaneous
The depositary will forward to the holders of Depositary Shares all reports
and communications from the Company that are delivered to the depositary and
that the Company is required to furnish to the holders of the Preferred Stock.
Neither the depositary nor the Company will be liable if it is prevented or
delayed by law or any circumstance beyond its control in performing its
obligations under the Deposit Agreement. The obligations of the Company and
the depositary under the Deposit Agreement will be limited to performance in
good faith of their duties thereunder and they will not be obligated to
prosecute or defend any legal proceeding with respect to any Depositary Shares
or Preferred Stock unless satisfactory indemnity is furnished. They may rely
upon written advice of counsel or accountants, or information provided by
persons presenting Preferred Stock for deposit, holders of Depositary Shares
or other persons believed to be competent and on documents believed to be
genuine.
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DESCRIPTION OF WARRANTS
The Company may issue Warrants for the purchase of Debt Securities,
Preferred Stock or Common Stock. Warrants may be issued independently or
together with Debt Securities, Preferred Stock or Common Stock offered by any
Prospectus Supplement and may be attached to or separate from any such Offered
Securities. Each series of Warrants will be issued under a separate warrant
agreement (a "Warrant Agreement") to be entered into between the Company and a
bank or trust company, as warrant agent (the "Warrant Agent"). The Warrant
Agent will act solely as an agent of the Company in connection with the
Warrants and will not assume any obligation or relationship of agency or trust
for or with any holders or beneficial owners of Warrants. The following
summary of certain provisions of the Warrants does not purport to be complete
and is subject to, and qualified in its entirety by reference to, the
provisions of the Warrant Agreement that will be filed with the SEC in
connection with the offering of such Warrants.
Debt Warrants
The Prospectus Supplement relating to a particular issue of Debt Warrants
will describe the terms of such Debt Warrants, including the following: (a)
the title of such Debt Warrants; (b) the offering price for such Debt
Warrants, if any; (c) the aggregate number of such Debt Warrants; (d) the
designation and terms of the Debt Securities purchasable upon exercise of such
Debt Warrants; (e) if applicable, the designation and terms of the Debt
Securities with which such Debt Warrants are issued and the number of such
Debt Warrants issued with each such Debt Security; (f) if applicable, the date
from and after which such Debt Warrants and any Debt Securities issued
therewith will be separately transferable; (g) the principal amount of Debt
Securities purchasable upon exercise of a Debt Warrant and the price at which
such principal amount of Debt Securities may be purchased upon exercise (which
price may be payable in cash, securities, or other property); (h) the date on
which the right to exercise such Debt Warrants shall commence and the date on
which such right shall expire; (i) if applicable, the minimum or maximum
amount of such Debt Warrants that may be exercised at any one time; (j)
whether the Debt Warrants represented by the Debt Warrant certificates or Debt
Securities that may be issued upon exercise of the Debt Warrants will be
issued in registered or bearer form; (k) information with respect to book-
entry procedures, if any; (1) the currency (including the Euro) or currency
units (including ECUs) in which the offering price, if any, and the exercise
price are payable; (m) if applicable, a discussion of material United States
federal income tax considerations; (n) the antidilution provisions of such
Debt Warrants, if any; (o) the redemption or call provisions, if any,
applicable to such Debt Warrants; and (p) any additional terms of such Debt
Warrants, including terms, procedures, and limitations relating to the
exchange and exercise of such Debt Warrants.
Stock Warrants
The Prospectus Supplement relating to any particular issue of Preferred
Stock Warrants or Common Stock Warrants will describe the terms of such
Warrants, including the following: (a) the title of such Warrants; (b) the
offering price for such Warrants, if any; (c) the aggregate number of such
Warrants; (d) the designation and terms of the Common Stock or Preferred Stock
purchasable upon exercise of such Warrants; (e) if applicable, the designation
and terms of the Offered Securities with which such Warrants are issued and
the number of such Warrants issued with each such Offered Security; (f) if
applicable, the date from and after which such Warrants and any Offered
Securities issued therewith will be separately transferable; (g) the number of
shares of Common Stock or Preferred Stock purchasable upon exercise of a
Warrant and the price at which such shares may be purchased upon exercise; (h)
the date on which the right to exercise such Warrants shall commence and the
date on which such right shall expire; (i) if applicable, the minimum or
maximum amount of such Warrants that may be exercised at any one time; (j) the
currency (including the Euro) or currency units (including ECUs) in which the
offering price, if any, and the exercise price are payable; (k) if applicable,
a discussion of material United States federal income tax considerations; (l)
the antidilution provisions of such Warrants, if any; (m) the redemption or
call provisions, if any, applicable to such Warrants; and (n) any additional
terms of such Warrants, including terms, procedures and limitations relating
to the exchange and exercise of such Warrants.
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PLAN OF DISTRIBUTION
The Company may sell the Offered Securities in or outside the United States
through underwriters or dealers, directly to one or more purchasers, or
through agents. The Prospectus Supplement with respect to the Offered
Securities will set forth the terms of the offering of the Offered Securities,
including the name or names of any underwriters, dealers, or agents, the
purchase price of the Offered Securities and the proceeds, to the Company from
such sale, any delayed delivery arrangements, any underwriting discounts and
other items constituting underwriters' compensation, the initial public
offering price, any discounts or concessions allowed or reallowed or paid to
dealers, and any securities exchanges on which the Offered Securities may be
listed.
If underwriters are used in the sale, the Offered Securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of
sale. The Offered Securities may be offered to the public either through
underwriting syndicates represented by one or more managing underwriters or
directly by one or more firms acting as underwriters. The underwriter or
underwriters with respect to a particular underwritten offering of Offered
Securities will be named in the Prospectus Supplement relating to such
offering, and if an underwriting syndicate is used, the managing underwriter
or underwriters will be set forth on the cover of such Prospectus Supplement.
Unless otherwise set forth in the Prospectus Supplement relating thereto, the
obligations of the underwriters or agents to purchase the Offered Securities
will be subject to conditions precedent and the underwriters will be obligated
to purchase all the Offered Securities if any are purchased. The initial
public offering price and any discounts or concessions allowed or reallowed or
paid to dealers may be changed from time to time.
If dealers are utilized in the sale of Offered Securities with respect to
which this Prospectus is delivered, the Company will sell such Offered
Securities to the dealers as principals. The dealers may then resell such
Offered Securities to the public at varying prices to be determined by such
dealers at the time of resale. The names of the dealers and the terms of the
transaction will be set forth in the Prospectus Supplement relating thereto.
Offered Securities may be sold directly by the Company or through agents
designated by the Company from time to time at fixed prices, which may be
changed, or at varying prices determined at the time of sale. Any agent
involved in the offer or sale of the Offered Securities with respect to which
this Prospectus is delivered will be named, and any commissions payable by the
Company to such agent will be set forth, in the Prospectus Supplement relating
thereto. Unless otherwise indicated in the Prospectus Supplement, any such
agent will be acting on a best efforts basis for the period of its
appointment.
In connection with the sale of the Offered Securities, underwriters or
agents may receive compensation from the Company or from purchasers of Offered
Securities for whom they may act as agents in the form of discounts,
concessions, or commissions. Underwriters, agents, and dealers participating
in the distribution of the Offered Securities may be deemed to be
underwriters, and any discounts or commissions received by them from the
Company and any profit on the resale of the Offered Securities by them may be
deemed to be underwriting discounts or commissions under the Securities Act.
Offered Securities may be sold directly by the Company to institutional
investors or others, who may be deemed to be underwriters within the meaning
of the Securities Act with respect to any resale thereof. The terms of any
such sales will be described in the Prospectus Supplement relating thereto.
If so indicated in the Prospectus Supplement, the Company will authorize
agents, underwriters, or dealers to solicit offers from certain types of
institutions to purchase Offered Securities from the Company at the public
offering price set forth in the Prospectus Supplement pursuant to delayed
delivery contracts providing for payment and delivery on a specified date in
the future. Such contracts will be subject only to those conditions set forth
in the Prospectus Supplement, and the Prospectus Supplement will set forth the
commission payable for solicitation of such contracts.
22
<PAGE>
Agents, dealers, and underwriters may be entitled under agreements entered
into with the Company to indemnification by the Company against certain civil
liabilities, including liabilities under the Securities Act, or to
contribution with respect to payments that such agents, dealers, or
underwriters may be required to make with respect thereto. Agents, dealers,
and underwriters may be customers of, engage in transactions with, or perform
services for the Company in the ordinary course of business.
Some or all of the Offered Securities may be new issues of securities with
no established trading market. Any underwriters to whom Offered Securities are
sold by the Company for public offering and sale may make a market in such
Offered Securities, but such underwriters will not be obligated to do so and
may discontinue any market making at any time without notice. No assurance can
be given as to the liquidity of or the trading markets for any Offered
Securities.
In order to facilitate the offering of the Offered Securities, any
underwriters or agents, as the case may be, involved in the offering of such
Offered Securities may engaged in transactions that stabilize, maintain or
otherwise affect the price of the Offered Securities or any other securities
the prices of which may be used to determine payments on such Offered
Securities. Specifically, the underwriters or agents, as the case may be, may
overallot in connection with the offering, creating a short position in such
Offered Securities for their own account. In addition, to cover overallotments
or to stabilize the price of such Offered Securities or any such other
securities, the underwriters or agents, as the case may be, may bid for, and
purchase, such Offered Securities or any such other securities in the open
market. Finally, in any offering of such Offered Securities through a
syndicate of underwriters, the underwriting syndicate may reclaim selling
concessions allowed to an underwriter or a dealer for distributing such
Offered Securities in the offering if the syndicate repurchases previously
distributed Offered Securities in transactions to cover syndicate short
positions, in stabilization transactions or otherwise. Any of these activities
may stabilize or maintain the market price of the Offered Securities above
independent market levels. The underwriters or agents, as the case may be, are
not required to engage in these activities, and may end any of these
activities at any time.
Agents, dealers and underwriters may be entitled under agreements entered
into with the Company to indemnification by the Company against certain civil
liabilities, including liabilities under the Securities Act, or to
contribution with respect to payments that such agents, dealers, or
underwriters may be required to make with respect thereto.
Certain of the underwriters, dealers or agents and their affiliates may be
customers of, engage in transactions with or perform services for the Company
in the ordinary course of business.
LEGAL OPINIONS
The validity of the Offered Securities will be passed upon for the Company
by Cravath, Swaine & Moore, New York, New York.
EXPERTS
The consolidated balance sheets of ChiRex Inc. as of December 31, 1996, 1997
and 1998 and the related consolidated statements of operations, stockholders'
equity and cash flows for each of the two years in the period ended December
31, 1998 incorporated by reference in this Prospectus have been audited by
Arthur Andersen LLP, independent public accountants, to the extent and for the
periods indicated in their report with respect thereto and have been included
herein in reliance upon the authority of such firm as experts in accounting
and auditing in giving such reports.
23
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the various expenses in connection with the
sale and distribution of the securities being registered, other than the
underwriting discounts and commissions. All amounts shown are estimates except
for the Securities and Exchange Commission registration fee.
<TABLE>
<S> <C>
SEC Registration Fee......................................... $ 29,085.75
Accounting Fees and Expenses................................. 100,000.00
Legal Fees and Expenses...................................... 200,000.00
Printing, Engraving and Mailing Expenses..................... 25,000.00
-----------
Total........................................................ $354,085.75
===========
</TABLE>
Item 15. Indemnification of Directors and Officers
Article EIGHTH of the Registrant's Certificate of Incorporation (the
"Certificate of Incorporation") provides that no director of the Registrant
shall be personally liable for any monetary damages for any breach of
fiduciary duty as a director, except to the extent that the Delaware General
Corporation Law prohibits the elimination or limitation of liability of
directors for breach of fiduciary duty.
Article NINTH of the Certificate of Incorporation provides that a director
or officer of the Registrant (a) shall be indemnified by the Registrant
against all expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement incurred in connection with any litigation or other legal
proceeding (other than an action by or in the right of the Registrant) brought
against him by virtue of his position as a director or officer of the
Registrant if he acted in good faith and in a manner he reasonably believed to
be in, or not opposed to the best interests of the Registrant, and, with
respect to any criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful and (b) shall be indemnified by the
Registrant against all expenses (including attorneys' fees) and amounts paid
in settlement incurred in connection with any action by or in the right of the
Registrant brought against him by virtue of his position as a director or
officer of the Registrant if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of the
Registrant, except that no indemnification shall be made with respect to any
matter as to which such person shall have been adjudged to be liable to the
Registrant, unless the Court of Chancery of Delaware determines that, despite
such adjudication but in view of all of the circumstances, he is entitled to
indemnification of such expenses. Notwithstanding the foregoing, to the extent
that a director or officer has been successful, on the merits or otherwise,
including, without limitation, the dismissal of an action without prejudice,
he is required to be indemnified by the Registrant against all expenses
(including attorneys' fees) actually and reasonably incurred in connection
therewith. In the event the Registrant does not assume the defense of an
action in accordance with the Certificate of Incorporation, expenses shall be
advanced to a director or officer at his request prior to the final
disposition of the matter, provided that he undertakes to repay the amount
advanced if it is ultimately determined that he is not entitled to
indemnification for such expenses.
Indemnification is required to be made unless the Registrant determines that
the applicable standard of conduct required for indemnification has not been
met. In the event of a determination by the Registrant that the director or
officer did not meet the applicable standard of conduct required for
indemnification, or if the Registrant fails to make an indemnification payment
within 60 days after such payment is claimed by such person, such person is
permitted to petition the court to make an independent determination as to
whether such person is entitled to indemnification. As a condition precedent
to the right of indemnification, the director, or officer must give the
Registrant notice of the action for which indemnity is sought and the
Registrant has the right to participate in such action or assume the defense
thereof.
II-1
<PAGE>
Article NINTH of the Certificate of Incorporation further provides that the
indemnification provided therein is not exclusive, and provides that in the
event that the Delaware General Corporation Law is amended to expand the
indemnification permitted to directors or officers the Registrant must
indemnify those persons to the fullest extent permitted by such law as so
amended.
Section 145 of the Delaware General Corporation Law provides that a
corporation has the power to indemnify a director, officer, employee or agent
of the corporation and certain other persons serving at the request of the
corporation in related capacities against amounts paid and expenses incurred
in connection with an action or proceeding to which he is or is threatened to
be made a party by reason of such position, if such person shall have acted in
good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, and, in any criminal proceeding, if
such person had no reasonable cause to believe his conduct was unlawful;
provided, that, in the case of actions brought by or in the right of the
corporation, no indemnification shall be made with respect to any matter as to
which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the adjudicating court determines that such
indemnification is proper under the circumstances.
Pursuant to the Underwriting Agreement, the Underwriters are obligated,
under certain circumstances, to indemnify directors and officers of the
Registrant against certain liabilities, including liabilities under the
Securities Act. Reference is made to the form of Underwriting Agreement filed
as Exhibits 1 hereto.
The Company has purchased a general liability insurance policy which covers
certain liabilities of directors and officers of the Company arising out of
claims based on acts or omissions in their capacities as directors and
officers.
Item 16. Exhibits
<TABLE>
<CAPTION>
Exhibit
No. Description
------- -----------
<C> <S>
1 Form of Underwriting Agreement.
4.1* Specimen Certificate for Shares of Common Stock, $.01 par value,
of the Registrant.
4.2***** Facilities Agreement between ChiRex (Holdings) Limited and Bankers
Trust Company.
4.3***** Pledge Agreement between ChiRex Inc. and Bankers Trust Company.
4.4****** Form of Indenture.
4.5****** Form of Depositary Agreement.
4.6****** Form of Warrant Agreement.
4.7******* Deeds of Accession to the Facilities Agreement by ChiRex America
Inc. and ChiRex Technologies Center Inc., as Guarantors.
4.8******* Amendment No. 3 dated February 19, 1999, to the Facilities
Agreement.
5 Opinion of Cravath, Swaine & Moore with respect to the validity of
the securities being offered.
10.1* 1995 Employee Stock Purchase Plan.
10.2*** 1997 Stock Incentive Plan.
10.3***** Amended and Restated 1995 Director Stock Option Plan.
10.4******* Employment Agreement with Michael A. Griffith dated as of
September 1, 1998.
10.5******* Amended and Restated Employment Agreement with Frank J. Wright
dated as of June 24, 1998 and Amendment No. 1 dated December 16,
1998.
10.6******* Amended and Restated Employment Agreement with Jon E. Tropsa dated
as of April 15, 1998.
10.7******* Employment Agreement with Ian D. Shott dated as of June 9, 1998.
</TABLE>
II-2
<PAGE>
<TABLE>
<C> <S>
10.8******* Employment Agreement with Roger B. Pettman dated as of April 15,
1998.
10.9******* Amended and Restated Employment Agreement with David F. Raynor
dated as of July 1, 1998.
10.10*** ChiRex Pension Scheme.
10.11+*** Supply Agreement dated as of January 21, 1997 between ChiRex Inc.
and Cell Therapeutics, Inc.
10.12+*** License Agreement dated as of January 28, 1997 between ChiRex Inc.
and President and Fellows of Harvard College.
10.13* Contract Research Agreement by and between the Registrant and
Sepracor Inc. dated December 21, 1995.
10.14* Contract Manufacturing Agreement by and between the Registrant and
Sepracor Inc.
10.15* Technology Transfer and License Agreement by and between the
Registrant and Sepracor Inc., dated as of January 1, 1995, as
amended.
10.16* Corporate Services Agreement by and between the Registrant and
Sepracor Inc. dated December 21, 1995.
10.17* Supply Agreement by and between the Registrant and Sepracor Inc.
dated December 21, 1995.
10.18* Technology Development Agreement by and between SepraChem Inc. and
Sandoz Pharma Ltd., dated October 1, 1995.
10.19* License Agreement by and between Sepracor Inc. and Massachusetts
Institute of Technology, dated May 5, 1989.
10.20* License Agreement by and between Sepracor Inc. and Massachusetts
Institute of Technology, dated June 21, 1991.
10.21* License Agreement by and between Sepracor Inc. and Research
Corporation Technologies, Inc., dated March 13, 1991.
10.22* License Agreement by and between Sepracor Inc. and Research
Corporation Technologies, Inc., dated September 10, 1992.
10.23* License Agreement by and between Sepracor Inc. and Tanabe Seiyaku
Co., Ltd., dated October 30, 1990.
10.24* Toll Manufacturing Agreement by and between Sterling Organics
Limited and Rohm and Haas (UK) Limited, dated July 4, 1991.
10.25* Toll Manufacturing Agreement by and between Sterling Organics
Limited and Rohm and Haas (UK) Limited, dated August 27, 1987.
10.26* Supply Agreement by and between Sterling Organics Limited and
Sanofi S.A., dated August 10, 1995.
10.27* Supply Agreement by and between Sterling Organics Limited and
Sanofi S.A. dated August 10, 1995.
10.28* Supply Agreement by and between Sterling Organics and Sanofi S.A.,
dated August 10, 1995.
10.29* Sterling/Currency LIBOR Revolving Credit Facility between Midland
Bank plc and ChiRex (Holdings) Limited, dated as of August 2,
1996.
10.30* Procedural Joint Union Agreement by and between Sterling Organics
and AEEU, dated July 7, 1975.
10.31* House Agreement by and between Sterling Organics Limited and AEEU,
dated February 1976.
10.32* Procedural Agreement by and between Sterling Organics Limited and
EESA, dated November 3, 1979.
10.33* Agreement by and between Sterling Organics Limited and ACTS, dated
July 19, 1978.
</TABLE>
II-3
<PAGE>
<TABLE>
<C> <S>
10.34* Escrow Agreement by and between the Registrant, Roger B. Pettman
and Broomes Secretarial
Services Limited.
10.35* Escrow Agreement by and between Alan R. Clark, David F. Raynor,
John E. Weir,
J. Graham Thorpe, Hugh F. Ford, William Riddle, Geoff B. Loxham,
C. Lyn Chapple,
David A. Routledge and Broomes Secretarial Services Limited.
10.36+***** Supply Agreement between ChiRex Inc. and Glaxo Wellcome plc.
10.37******* Exclusive Licensing Agreement with Massachusetts Institute of
Technology dated May 22, 1998.
10.38******* Consulting Agreement with Eric N. Jacobsen dated as of October 1,
1998.
10.39+**** Asset Purchase Agreement between ChiRex Limited, ChiRex Inc. and
Rhone-Poulenc Chimie S.A.
10.40+***** Asset Purchase Agreement between ChiRex Inc. and Glaxo Wellcome
plc.
10.41******* Consulting Agreements dated as of April 18, 1998, with Elizabeth
M. Greetham and
W. Dieter Zander.
10.42******* Assignment Agreements to ChiRex America, Inc. dated as of May 19,
1998, of the License
Agreements listed under Exhibits 10.19, 10.20 and 10.22.
10.43******* Amendment No. 3 dated as of May 19, 1998, to the Technology
Transfer and License Agreement.
10.44******* Lease Agreement dated November 1, 1998, and Amendment to the
Lease Agreement.
12 Computation of Ratio of Earnings to Fixed Charges and Earnings to
Fixed Charges--Coverage Deficiency for the Registrant.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Cravath, Swaine & Moore (included in Exhibit 5).
24 Power of Attorney (included on page II-7)
25****** Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of United States Trust Company of New York,
as trustee, on Form T-1.
</TABLE>
- --------
* Incorporated by reference to the corresponding exhibits in the
Registration Statement on Form S-1 previously filed by the Registrant
(File no. 33-80831).
** Incorporated by reference to the Form 8-K previously filed by the
Registrant on September 11, 1996.
*** Incorporated by reference to the corresponding exhibits in the
Registration Statement on Form S-1 previously filed by the Registrant
(File no. 333-22401).
**** Incorporated by reference to the Form 8-K previously filed by the
Registrant on April 11, 1997.
***** Incorporated by reference to the Form 8-K previously filed by the
Registrant on November 17, 1997.
****** Incorporated by reference to the corresponding exhibits in the
Registration Statements on Form S-3 previously filed by the
Registrant (File no. 333-68849).
******* Incorporated by reference to the corresponding exhibits in the Annual
Report on Form 10-K for the fiscal year ended December 31, 1998
previously filed by the Registrant.
+ Confidential treatment received as to certain portions.
II-4
<PAGE>
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 the 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% 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 this registration statement;
Provided, however, that paragraphs (i) and (ii) above 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 this registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, as amended, 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.
(4) As to documents subsequently filed that are incorporated by
reference: The undersigned registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933, each filing
of the registrant's annual report pursuant to section 13(a) or section
15(d) of the Securities Exchange Act of 1934 (and each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934, as applicable) that is incorporated by
reference in the registration statement 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.
(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 contained in the Certificate of
Incorporation and Amended and Restated By-Laws of the Registrant and the laws
of the State of Delaware, 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 Securities 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 Securities Act and will be governed
by the final adjudication of such issue.
II-5
<PAGE>
(C) The undersigned Registrant hereby undertakes to provide to the
Underwriters at the closing specified in the Underwriting Agreement
certificates in such denominations and registered in such names as required by
the Underwriters to permit prompt delivery to each purchaser.
(D) The undersigned Registrant hereby undertakes that:
(1) For the purposes of determining any liability under the Securities
Act, 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.
(2) For the purpose of determining any liability under the Securities
Act, 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-6
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of 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 Stamford, Connecticut on May 26, 1999.
CHIREX INC.
/s/ Michael A. Griffith
By: _________________________________
Michael A. Griffith,
Chairman and Chief Executive
Officer
POWER OF ATTORNEY
Each person whose signature appears below hereby authorizes and appoints
Michael A. Griffith as his or her attorney-in-fact, with full power of
substitution and resubstitution, to sign and file on his or her behalf
individually and in each capacity stated below any and all amendments
(including post-effective amendments) to this Registration Statement and any
subsequent registration statement filed by the Company pursuant to Rule 462(b)
under the Securities Act of 1933, as fully as such person could do in person,
hereby verifying and confirming all that such attorney-in-fact, or his or her
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title Date
/s/ Michael A. Griffith Chairman of the Board, May 26, 1999
- ------------------------------------- Chief Executive
Michael A. Griffith Officer, and Director
(principal executive
officer)
Director
- -------------------------------------
Dirk Detert
/s/ Eric N. Jacobsen Director May 26, 1999
- -------------------------------------
Eric N. Jacobsen
/s/ W. Dieter Zander Director May 26, 1999
- -------------------------------------
W. Dieter Zander
/s/ Jon E. Tropsa Vice President, May 26, 1999
- ------------------------------------- Finance (principal
Jon E. Tropsa financial and
accounting officer)
II-7
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
No. Description
------- -----------
<C> <S>
1 Form of Underwriting Agreement.
4.1* Specimen Certificate for Shares of Common Stock, $.01 par value,
of the Registrant.
4.2***** Facilities Agreement between ChiRex (Holdings) Limited and Bankers
Trust Company.
4.3***** Pledge Agreement between ChiRex Inc. and Bankers Trust Company.
4.4****** Form of Indenture.
4.5****** Form of Depositary Agreement.
4.6****** Form of Warrant Agreement.
4.7******* Deeds of Accession to the Facilities Agreement by ChiRex America
Inc. and ChiRex Technologies Center Inc., as Guarantors.
4.8******* Amendment No. 3 dated February 19, 1999, to the Facilities
Agreement.
5 Opinion of Cravath, Swaine & Moore with respect to the validity of
the securities being offered.
10.1* 1995 Employee Stock Purchase Plan.
10.2*** 1997 Stock Incentive Plan.
10.3***** Amended and Restated 1995 Director Stock Option Plan.
10.4******* Employment Agreement with Michael A. Griffith dated as of
September 1, 1998.
10.5******* Amended and Restated Employment Agreement with Frank J. Wright
dated as of June 24, 1998 and Amendment No. 1 dated December 16,
1998.
10.6******* Amended and Restated Employment Agreement with Jon E. Tropsa dated
as of April 15, 1998.
10.7******* Employment Agreement with Ian D. Shott dated as of June 9, 1998.
10.8******* Employment Agreement with Roger B. Pettman dated as of April 15,
1998.
10.9******* Amended and Restated Employment Agreement with David F. Raynor
dated as of July 1, 1998.
10.10*** ChiRex Pension Scheme.
10.11+*** Supply Agreement dated as of January 21, 1997 between ChiRex Inc.
and Cell Therapeutics, Inc.
10.12+*** License Agreement dated as of January 28, 1997 between ChiRex Inc.
and President and Fellows of Harvard College.
10.13* Contract Research Agreement by and between the Registrant and
Sepracor Inc. dated December 21, 1995.
10.14* Contract Manufacturing Agreement by and between the Registrant and
Sepracor Inc.
10.15* Technology Transfer and License Agreement by and between the
Registrant and Sepracor Inc., dated as of January 1, 1995, as
amended.
10.16* Corporate Services Agreement by and between the Registrant and
Sepracor Inc. dated December 21, 1995.
10.17* Supply Agreement by and between the Registrant and Sepracor Inc.
dated December 21, 1995.
10.18* Technology Development Agreement by and between SepraChem Inc. and
Sandoz Pharma Ltd., dated October 1, 1995.
10.19* License Agreement by and between Sepracor Inc. and Massachusetts
Institute of Technology, dated May 5, 1989.
10.20* License Agreement by and between Sepracor Inc. and Massachusetts
Institute of Technology, dated June 21, 1991.
</TABLE>
<PAGE>
<TABLE>
<C> <S>
10.21* License Agreement by and between Sepracor Inc. and Research
Corporation Technologies, Inc., dated March 13, 1991.
10.22* License Agreement by and between Sepracor Inc. and Research
Corporation Technologies, Inc., dated September 10, 1992.
10.23* License Agreement by and between Sepracor Inc. and Tanabe Seiyaku
Co., Ltd., dated October 30, 1990.
10.24* Toll Manufacturing Agreement by and between Sterling Organics
Limited and Rohm and Haas (UK) Limited, dated July 4, 1991.
10.25* Toll Manufacturing Agreement by and between Sterling Organics
Limited and Rohm and Haas (UK) Limited, dated August 27, 1987.
10.26* Supply Agreement by and between Sterling Organics Limited and
Sanofi S.A., dated August 10, 1995.
10.27* Supply Agreement by and between Sterling Organics Limited and
Sanofi S.A. dated August 10, 1995.
10.28* Supply Agreement by and between Sterling Organics and Sanofi
S.A., dated August 10, 1995.
10.29* Sterling/Currency LIBOR Revolving Credit Facility between Midland
Bank plc and ChiRex (Holdings) Limited, dated as of August 2,
1996.
10.30* Procedural Joint Union Agreement by and between Sterling Organics
and AEEU, dated July 7, 1975.
10.31* House Agreement by and between Sterling Organics Limited and
AEEU, dated February 1976.
10.32* Procedural Agreement by and between Sterling Organics Limited and
EESA, dated November 3, 1979.
10.33* Agreement by and between Sterling Organics Limited and ACTS,
dated July 19, 1978.
10.34* Escrow Agreement by and between the Registrant, Roger B. Pettman
and Broomes Secretarial Services Limited.
10.35* Escrow Agreement by and between Alan R. Clark, David F. Raynor,
John E. Weir, J. Graham Thorpe, Hugh F. Ford, William Riddle,
Geoff B. Loxham, C. Lyn Chapple, David A. Routledge and Broomes
Secretarial Services Limited.
10.36+***** Supply Agreement between ChiRex Inc. and Glaxo Wellcome plc.
10.37******* Exclusive Licensing Agreement with Massachusetts Institute of
Technology dated May 22, 1998.
10.38******* Consulting Agreement with Eric N. Jacobsen dated as of October 1,
1998.
10.39+**** Asset Purchase Agreement between ChiRex Limited, ChiRex Inc. and
Rhone-Poulenc Chimie S.A.
10.40+***** Asset Purchase Agreement between ChiRex Inc. and Glaxo Wellcome
plc.
10.41******* Consulting Agreements dated as of April 18, 1998, with Elizabeth
M. Greetham and W. Dieter Zander.
10.42******* Assignment Agreements to ChiRex America, Inc. dated as of May 19,
1998, of the License Agreements listed under Exhibits 10.19,
10.20 and 10.22.
10.43******* Amendment No. 3 dated as of May 19, 1998, to the Technology
Transfer and License Agreement.
10.44******* Lease Agreement dated November 1, 1998, and Amendment to the
Lease Agreement.
12 Computation of Ratio of Earnings to Fixed Charges and Earnings to
Fixed Charges--Coverage Deficiency for the Registrant.
23.1 Consent of Arthur Andersen LLP.
</TABLE>
<PAGE>
<TABLE>
<C> <S>
23.2 Consent of Cravath, Swaine & Moore (included in Exhibit 5).
24 Power of Attorney (included on Page II-7)
25****** Statement of Eligibility and Qualification under the Trust Indenture
Act of 1939 of United
States Trust Company of New York, as trustee, on Form T-1.
</TABLE>
- --------
* Incorporated by reference to the corresponding exhibits in the
Registration Statement on Form S-1 previously filed by the Registrant
(File no. 33-80831).
** Incorporated by reference to the Form 8-K previously filed by the
Registrant on September 11, 1996.
*** Incorporated by reference to the corresponding exhibits in the
Registration Statement on Form S-1 previously filed by the Registrant
(File no. 333-22401).
**** Incorporated by reference to the Form 8-K previously filed by the
Registrant on April 11, 1997.
***** Incorporated by reference to the Form 8-K previously filed by the
Registrant on November 17, 1997.
****** Incorporated by reference to the corresponding exhibits in the
Registration Statement on Form S-3 previously filed by the Registrant
(File no. 333-68849).
******* Incorporated by reference to the corresponding exhibits in the Annual
Report on Form 10-K for the fiscal year ended December 31, 1998
previously filed by the Registrant.
+ Confidential treatment received as to certain portions.
<PAGE>
EXHIBIT 1
CHIREX INC.
DEBT SECURITIES,
PREFERRED AND COMMON STOCK
UNDERWRITING AGREEMENT
----------------------
1. Introductory. ChiRex Inc., a Delaware corporation ("COMPANY"),
proposes to issue and sell from time to time certain of its unsecured debt
securities, preferred stock and common stock, $.01 par value ("COMMON STOCK")
registered under the registration statement referred to in Section 2(a)
("REGISTERED SECURITIES"). The Registered Securities constituting debt
securities will be issued under an indenture, dated as of [ ], 1998
("INDENTURE"), between the Company and United States Trust Company of New York,
as Trustee, in one or more series, which series may vary as to interest rates,
maturities, redemption provisions, selling prices and other terms. The
Registered Securities constituting preferred stock may be issued in one or more
series, which series may vary as to dividend rates, redemption provisions,
selling prices and other terms. Particular series or offerings of Registered
Securities will be sold pursuant to a Terms Agreement referred to in Section 3,
for resale in accordance with terms of offering determined at the time of sale.
The Registered Securities involved in any such offering are hereinafter
referred to as the "OFFERED SECURITIES". The firm or firms which agree to
purchase the Offered Securities are hereinafter referred to as the
"UNDERWRITERS" of such securities, and the representative or representatives of
the Underwriters, if any, specified in a Terms Agreement referred to in Section
3 are hereinafter referred to as the "REPRESENTATIVES"; provided, however, that
-------- -------
if the Terms Agreement does not specify any representative of the Underwriters,
the term "Representatives", as used in this Agreement (other than in Sections
2(b), 5(c) and 6 and the second sentence of Section 3), shall mean the
Underwriters.
2. Representations and Warranties of the Company. The Company, as of the
date of each Terms Agreement referred to in Section 3, represents and warrants
to, and agrees with, each Underwriter that:
(a) A registration statement (No. 333-__________), including a
prospectus, relating to the Registered Securities has been filed with the
Securities and Exchange Commission ("COMMISSION") and has become effective.
Such registration statement, as amended at the time of any Terms Agreement
referred to in Section 3, is hereinafter referred to as the "REGISTRATION
STATEMENT", and the prospectus included in such Registration Statement, as
supplemented and as contemplated by Section 3 to reflect the terms of the
Offered Securities (if they are debt securities or preferred stock) and the
terms of the offering of the Offered Securities, as first filed with the
Commission pursuant to and in accordance with Rule 424(b) ("RULE 424(b)")
under the Securities Act of 1933 ("ACT"), including all material
incorporated by reference therein, is hereinafter referred to as the
"PROSPECTUS". No document has been or will be prepared or distributed in
reliance on Rule 434 under the Act.
(b) On the effective date of the registration statement relating to
the Registered Securities, such registration statement conformed in all
respects to the requirements of the Act, the Trust Indenture Act of 1939
("TRUST INDENTURE ACT") and the rules and regulations of the Commission
("RULES AND REGULATIONS") and did not include any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and on
the date of each Terms Agreement referred to in Section 3, the Registration
Statement and the Prospectus will conform in all respects to the
requirements of the Act, the Trust Indenture Act and the Rules and
Regulations, and neither of such documents will include any untrue
statement of a material fact or omit to state any material fact required to
be stated therein or necessary to make the statements therein not
misleading, except that the foregoing does not apply to statements in or
omissions from any of such documents based upon written information
furnished to the Company by any Underwriter through the Representatives, if
any, specifically for use therein.
(c) The Company has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with
power and authority (corporate and other) to own its properties and conduct
its business as described in the Prospectus; and the Company is duly
qualified to do business as a foreign corporation in good standing in all
other jurisdictions in which its ownership or lease of property or the
conduct of its business requires such qualification.
<PAGE>
(d) Each subsidiary of the Company has been duly incorporated and is
an existing corporation in good standing under the laws of the jurisdiction
of its incorporation, with power and authority (corporate and other) to own
its properties and conduct its business as described in the Prospectus; and
each subsidiary of the Company is duly qualified to do business as a
foreign corporation in good standing in all other jurisdictions in which
its ownership or lease of property or the conduct of its business requires
such qualification; all of the issued and outstanding capital stock of each
subsidiary of the Company has been duly authorized and validly issued and
is fully paid and nonassessable; and the capital stock of each subsidiary
owned by the Company, directly or through subsidiaries, is owned free from
liens, encumbrances and defects.
(e) If the Offered Securities are debt securities: The Indenture has
been duly authorized and has been duly qualified under the Trust Indenture
Act; the Offered Securities have been duly authorized; and when the Offered
Securities are delivered and paid for pursuant to the Terms Agreement on
the Closing Date (as defined below) or pursuant to Delayed Delivery
Contracts (as hereinafter defined), the Indenture will have been duly
executed and delivered, such Offered Securities will have been duly
executed, authenticated, issued and delivered and will conform to the
description thereof contained in the Prospectus and the Indenture and such
Offered Securities will constitute valid and legally binding obligations of
the Company, enforceable in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles.
(f) If the Offered Securities are preferred stock: The Offered
Securities have been duly authorized and, when the Offered Securities have
been delivered and paid for in accordance with the Terms Agreement on the
Closing Date, such Offered Securities will have been validly issued, fully
paid and nonassessable and will conform to the description thereof
contained in the Prospectus; and the stockholders of the Company have no
preemptive rights with respect to the Offered Securities.
(g) If the Offered Securities are Common Stock: The Offered
Securities and all other outstanding shares of capital stock of the Company
have been duly authorized; all outstanding shares of capital stock of the
Company are, and, when the Offered Securities have been delivered and paid
for in accordance with the Terms Agreement on the Closing Date, such
Offered Securities will have been validly issued, fully paid and
nonassessable and will conform to the description thereof contained in the
Prospectus; and the stockholders of the Company have no preemptive rights
with respect to the Offered Securities.
(h) If the Offered Securities are convertible: When the Offered
Securities are delivered and paid for pursuant to the Terms Agreement on
the Closing Date, such Offered Securities will be convertible into Common
Stock of the Company in accordance with their terms (if the Offered
Securities are preferred stock) or the Indenture (if the Offered Securities
are debt securities); the shares of Common Stock initially issuable upon
conversion of such Offered Securities have been duly authorized and
reserved for issuance upon such conversion and, when issued upon such
conversion, will be validly issued, fully paid and nonassessable; the
outstanding shares of Common Stock have been duly authorized and validly
issued, are fully paid and nonassessable and conform to the description
thereof contained in the Prospectus; and the stockholders of the Company
have no preemptive rights with respect to the Common Stock.
(i) If the Offered Securities are Common Stock or are convertible
into Common Stock: Except as disclosed in the Prospectus, there are no
contracts, agreements or understandings between the Company and any person
that would give rise to a valid claim against the Company or any
Underwriter for a brokerage commission, finder's fee or other like payment.
(j) If the Offered Securities are Common Stock or are convertible
into Common Stock: There are no contracts, agreements or understandings
between the Company and any person granting such person the right to
require the Company to file a registration statement under the Act with
respect to any securities of the Company owned or to be owned by such
person or to require the Company to include such securities in the
securities registered pursuant to the Registration Statement or in any
securities being registered pursuant to any other registration statement
filed by the Company under the Act.
(k) No consent, approval, authorization, or order of, or filing with,
any governmental agency or body or any court is required for the
consummation of the transactions contemplated by the Terms Agreement
(including the provisions of this Agreement) in connection with the
issuance and sale of the Offered Securities by the Company, except such as
have been obtained and made under the Act and, if the Offered Securities
are debt securities, the Trust Indenture Act and such as may be required
under state securities laws.
(l) The execution, delivery and performance of the Indenture (if the
Offered Securities are debt securities), the Terms Agreement (including the
provisions of this Agreement) and any Delayed Delivery
2
<PAGE>
Contracts and the issuance and sale of the Offered Securities and, if the
Offered Securities are debt securities or preferred stock, compliance with
the terms and provisions thereof will not result in a breach or violation
of any of the terms and provisions of, or constitute a default under, any
statute, any rule, regulation or order of any governmental agency or body
or any court, domestic or foreign, having jurisdiction over the Company or
any subsidiary of the Company or any of their properties, or any agreement
or instrument to which the Company or any such subsidiary is a party or by
which the Company or any such subsidiary is bound or to which any of the
properties of the Company or any such subsidiary is subject, or the charter
or by-laws of the Company or any such subsidiary, and the Company has full
power and authority to authorize, issue and sell the Offered Securities as
contemplated by the Terms Agreement (including the provisions of this
Agreement).
(m) The Terms Agreement (including the provisions of this Agreement)
and, if the Offered Securities are debt securities or preferred stock, any
Delayed Delivery Contracts have been duly authorized, executed and
delivered by the Company.
(n) Except as disclosed in the Prospectus, the Company and its
subsidiaries have good and marketable title to all real properties and all
other properties and assets owned by them, in each case free from liens,
encumbrances and defects that would materially affect the value thereof or
materially interfere with the use made or to be made thereof by them; and
except as disclosed in the Prospectus, the Company and its subsidiaries
hold any leased real or personal property under valid and enforceable
leases with no exceptions that would materially interfere with the use made
or to be made thereof by them.
(o) The Company and its subsidiaries possess adequate certificates,
authorities or permits issued by appropriate governmental agencies or
bodies necessary to conduct the business now operated by them and have not
received any notice of proceedings relating to the revocation or
modification of any such certificate, authority or permit that, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a material adverse effect on the
Company and its subsidiaries taken as a whole.
(p) No labor dispute with the employees of the Company or any
subsidiary exists or, to the knowledge of the Company, is imminent that
might have a material adverse effect on the Company and its subsidiaries
taken as a whole.
(q) The Company and its subsidiaries own, possess or can acquire on
reasonable terms, adequate trademarks, trade names and other rights to
inventions, know-how, patents, copyrights, confidential information and
other intellectual property (collectively, "intellectual property rights")
necessary to conduct the business now operated by them, or presently
employed by them, and have not received any notice of infringement of or
conflict with asserted rights of others with respect to any intellectual
property rights that, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a material
adverse effect on the Company and its subsidiaries taken as a whole.
(r) Except as disclosed in the Prospectus, neither the Company nor
any of its subsidiaries is in violation of any statute, any rule,
regulation, decision or order of any governmental agency or body or any
court, domestic or foreign, relating to the use, disposal or release of
hazardous or toxic substances or relating to the protection or restoration
of the environment or human exposure to hazardous or toxic substances
(collectively, "ENVIRONMENTAL LAWS"), owns or operates any real property
contaminated with any substance that is subject to any environmental laws,
is liable for any off-site disposal or contamination pursuant to any
environmental laws, or is subject to any claim relating to any
environmental laws, which violation, contamination, liability or claim
would individually or in the aggregate have a material adverse effect on
the Company and its subsidiaries taken as a whole; and the Company is not
aware of any pending investigation which might lead to such a claim.
(s) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Company, any of its
subsidiaries or any of their respective properties that, if determined
adversely to the Company or any of its subsidiaries, would individually or
in the aggregate have a material adverse effect on the condition (financial
or other), business, properties or results of operations of the Company and
its subsidiaries taken as a whole, or would materially and adversely affect
the ability of the Company to perform its obligations under the Indenture
(if the Offered Securities are debt securities), the Terms Agreement
(including the provisions of this Agreement) or any Delayed Delivery
Contracts, or which are otherwise material in the context of the sale of
the Offered Securities; and no such actions, suits or proceedings are
threatened or, to the Company's knowledge, contemplated.
(t) The financial statements included in the Registration Statement
and Prospectus present fairly the financial position of the Company and its
consolidated subsidiaries as of the dates shown and their results of
operations and cash flows for the periods shown, and, except as otherwise
disclosed in the
3
<PAGE>
Prospectus, such financial statements have been prepared in conformity with
the generally accepted accounting principles in the United States applied
on a consistent basis; any schedules included in the Registration Statement
present fairly the information required to be stated therein; and if pro
forma financial statements are included in the Registration Statement and
Prospectus: the assumptions used in preparing the pro forma financial
statements included in the Registration Statement and the Prospectus
provide a reasonable basis for presenting the significant effects directly
attributable to the transactions or events described therein, the related
pro forma adjustments give appropriate effect to those assumptions, and the
pro forma columns therein reflect the proper application of those
adjustments to the corresponding historical financial statement amounts.
(u) Except as disclosed in the Prospectus, since the date of the
latest audited financial statements included in the Prospectus there has
been no material adverse change, nor any development or event involving a
prospective material adverse change, in the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries taken as a whole, and, except as disclosed in or contemplated
by the Prospectus, there has been no dividend or distribution of any kind
declared, paid or made by the Company on any class of its capital stock.
(v) The Company is not and, after giving effect to the offering and
sale of the Offered Securities and the application of the proceeds thereof
as described in the Prospectus, will not be an "investment company" as
defined in the Investment Company Act of 1940.
3. Purchase and Offering of Offered Securities. The obligation of the
Underwriters to purchase the Offered Securities will be evidenced by an
agreement or exchange of other written communications ("TERMS AGREEMENT") at the
time the Company determines to sell the Offered Securities. The Terms Agreement
will incorporate by reference the provisions of this Agreement, except as
otherwise provided therein, and will specify the firm or firms which will be
Underwriters, the names of any Representatives, the principal amount or number
of shares to be purchased by each Underwriter, the purchase price to be paid by
the Underwriters and (if the Offered Securities are debt securities or preferred
stock) the terms of the Offered Securities not already specified (in the
Indenture, in the case of Offered Securities that are debt securities),
including, but not limited to, interest rate (if debt securities), dividend rate
(if preferred stock), maturity (if debt securities), any redemption provisions
and any sinking fund requirements and whether any of the Offered Securities may
be sold to institutional investors pursuant to Delayed Delivery Contracts (as
defined below). The Terms Agreement will also specify the time and date of
delivery and payment (such time and date, or such other time not later than
seven full business days thereafter as the Underwriter first named in the Terms
Agreement (the "Lead Underwriter") and the Company agree as the time for payment
and delivery, being herein and in the Terms Agreement referred to as the
"Closing Date"), the place of delivery and payment and any details of the terms
of offering that should be reflected in the prospectus supplement relating to
the offering of the Offered Securities. For purposes of Rule 15c6-1 under the
Securities Exchange Act of 1934, the Closing Date (if later than the otherwise
applicable settlement date) shall be the date for payment of funds and delivery
of securities for all the Offered Securities sold pursuant to the offering,
other than Contract Securities for which payment of funds and delivery of
securities shall be as hereinafter provided. The obligations of the
Underwriters to purchase the Offered Securities will be several and not joint.
It is understood that the Underwriters propose to offer the Offered Securities
for sale as set forth in the Prospectus.
If the Terms Agreement provides for sales of Offered Securities pursuant to
delayed delivery contracts, the Company authorizes the Underwriters to solicit
offers to purchase Offered Securities pursuant to delayed delivery contracts
substantially in the form of Annex I attached hereto ("DELAYED DELIVERY
CONTRACTS") with such changes therein as the Company may authorize or approve.
Delayed Delivery Contracts are to be with institutional investors, including
commercial and savings banks, insurance companies, pension funds, investment
companies and educational and charitable institutions. On the Closing Date the
Company will pay, as compensation, to the Representatives for the accounts of
the Underwriters, the fee set forth in such Terms Agreement in respect of the
principal amount or number of shares of Offered Securities to be sold pursuant
to Delayed Delivery Contracts ("CONTRACT SECURITIES"). The Underwriters will not
have any responsibility in respect of the validity or the performance of Delayed
Delivery Contracts. If the Company executes and delivers Delayed Delivery
Contracts, the Contract Securities will be deducted from the Offered Securities
to be purchased by the several Underwriters and the aggregate principal amount
or number of shares of Offered Securities to be purchased by each Underwriter
will be reduced pro rata in proportion to the principal amount or number of
shares of Offered Securities set forth opposite each Underwriter's name in such
Terms Agreement, except to the extent that the Lead Underwriter determines that
such reduction shall be otherwise than pro rata and so advise the Company. The
Company will advise the Lead Underwriter not later than the business day prior
to the Closing Date of the principal amount or number of shares of Contract
Securities.
If the Offered Securities are debt securities and the Terms Agreement
specifies "Book-Entry Only" settlement or otherwise states that the provisions
of this paragraph shall apply, the Company will deliver against payment of the
purchase price the Offered Securities in the form of one or more permanent
global securities in
4
<PAGE>
definitive form (the "GLOBAL SECURITIES") deposited with the Trustee as
custodian for The Depository Trust Company ("DTC") and registered in the name of
Cede & Co., as nominee for DTC. Interests in any permanent global securities
will be held only in book-entry form through DTC, except in the limited
circumstances described in the Prospectus. Payment for the Offered Securities
shall be made by the Underwriters (if the Terms Agreement specifies that the
Offered Securities will not trade in DTC's Same Day Funds Settlement System) by
certified or official bank check or checks in New York Clearing House (next day)
funds or (if the Terms Agreement specifies that the Offered Securities will
trade in DTC's Same Day Funds Settlement System) in Federal (same day) funds by
official check or checks or wire transfer to an account in New York previously
designated to the Lead Underwriter by the Company at a bank acceptable to the
Lead Underwriter, in each case drawn to the order of the Company at the place of
payment specified in the Terms Agreement on the Closing Date, against delivery
to the Trustee as custodian for DTC of the Global Securities representing all of
the Offered Securities.
4. Certain Agreements of the Company. The Company agrees with the several
Underwriters that it will furnish to counsel for the Underwriters, one signed
copy of the registration statement relating to the Registered Securities,
including all exhibits, in the form it became effective and of all amendments
thereto and that, in connection with each offering of Offered Securities:
(a) The Company will file the Prospectus with the Commission pursuant
to and in accordance with Rule 424(b)(2) (or, if applicable and if
consented to by the Lead Underwriter, subparagraph (5)) not later than the
second business day following the execution and delivery of the Terms
Agreement.
(b) The Company will advise the Lead Underwriter promptly of any
proposal to amend or supplement the Registration Statement or the
Prospectus and will afford the Lead Underwriter a reasonable opportunity to
comment on any such proposed amendment or supplement; and the Company will
also advise the Lead Underwriter promptly of the filing of any such
amendment or supplement and of the institution by the Commission of any
stop order proceedings in respect of the Registration Statement or of any
part thereof and will use its best efforts to prevent the issuance of any
such stop order and to obtain as soon as possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the Offered
Securities is required to be delivered under the Act in connection with
sales by any Underwriter or dealer, any event occurs as a result of which
the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary at any time to
amend the Prospectus to comply with the Act, the Company promptly will
notify the Lead Underwriter of such event and will promptly prepare and
file with the Commission, at its own expense, an amendment or supplement
which will correct such statement or omission or an amendment which will
effect such compliance. Neither the Lead Underwriter's consent to, nor the
Underwriters' delivery of, any such amendment or supplement shall
constitute a waiver of any of the conditions set forth in Section 5.
(d) As soon as practicable, but not later than 16 months, after the
date of each Terms Agreement, the Company will make generally available to
its securityholders an earnings statement covering a period of at least 12
months beginning after the later of (i) the effective date of the
registration statement relating to the Registered Securities, (ii) the
effective date of the most recent post-effective amendment to the
Registration Statement to become effective prior to the date of such Terms
Agreement and (iii) the date of the Company's most recent Annual Report on
Form 10-K filed with the Commission prior to the date of such Terms
Agreement, which will satisfy the provisions of Section 11(a) of the Act.
(e) The Company will furnish to the Representatives copies of the
Registration Statement, including all exhibits, any related preliminary
prospectus, any related preliminary prospectus supplement, the Prospectus
and all amendments and supplements to such documents, in each case as soon
as available and in such quantities as the Lead Underwriter reasonably
requests. The Company will pay the expenses of printing and distributing
to the Underwriters all such documents.
(f) The Company will arrange for the qualification of the Offered
Securities for sale and (if the Offered Securities are debt securities or
preferred stock) the determination of their eligibility for investment
under the laws of such jurisdictions as the Lead Underwriter designates and
will continue such qualifications in effect so long as required for the
distribution.
(g) During the period of 10 years after the date of any Terms
Agreement, the Company will furnish to the Representatives and, upon
request, to each of the other Underwriters, if any, as soon as practicable
after the end of each fiscal year, a copy of its annual report to
stockholders for such year; and the Company will furnish to the
Representatives (i) as soon as available, a copy of each report and any
definitive proxy statement of the Company filed with the Commission under
the Securities Exchange Act
5
<PAGE>
of 1934 or mailed to stockholders, and (ii) from time to time, such other
information concerning the Company as the Lead Underwriter may reasonably
request.
(h) The Company will pay all expenses incident to the performance of
its obligations under the Terms Agreement (including the provisions of this
Agreement), for any filing fees or other expenses (including fees and
disbursements of counsel) in connection with qualification of the
Registered Securities for sale and (if the Offered Securities are debt
securities or preferred stock) any determination of their eligibility for
investment under the laws of such jurisdictions as the Lead Underwriter may
designate and the printing of memoranda relating thereto, for any fees
charged by investment rating agencies for the rating of the Offered
Securities (if they are debt securities or preferred stock), for any
applicable filing fee incident to, and the reasonable fees and
disbursements of counsel for the Underwriters in connection with, the
review by the National Association of Securities Dealers, Inc. of the
Registered Securities, for any travel expenses of the Company's officers
and employees and any other expenses of the Company in connection with
attending or hosting meetings with prospective purchasers of Registered
Securities and for expenses incurred in distributing the Prospectus, any
preliminary prospectuses, any preliminary prospectus supplements or any
other amendments or supplements to the Prospectus to the Underwriters.
(i) If the Offered Securities are debt securities or preferred stock,
the Company will not offer, sell, contract to sell, pledge or otherwise
dispose of, directly or indirectly, or file with the Commission a
registration statement under the Act relating to United States dollar-
denominated debt securities issued or guaranteed by the Company and having
a maturity of more than one year from the date of issue (if the Offered
Securities are debt securities) or any series of preferred stock issued or
guaranteed by the Company (if the Offered Securities are preferred stock),
or publicly disclose the intention to make any such offer, sale, pledge,
disposition or filing, without the prior written consent of the Lead
Underwriter for a period beginning at the time of execution of the Terms
Agreement and ending the number of days after the Closing Date specified
under "Blackout" in the Terms Agreement.
(j) If the Offered Securities are Common Stock or are convertible
into Common Stock, the Company will not offer, sell, contract to sell,
pledge or otherwise dispose of, directly or indirectly, or file with the
Commission a registration statement under the Act relating to, any
additional shares of its Common Stock or securities convertible into or
exchangeable or exercisable for any shares of its Common Stock, or publicly
disclose the intention to make any such offer, sale, pledge, disposition or
filing, without the prior written consent of the Lead Underwriter for a
period beginning at the time of execution of the Terms Agreement and ending
the number of days after the Closing Date specified under "Blackout" in the
Terms Agreement, except grants of employee stock options pursuant to the
terms of a plan in effect on the date of the Terms Agreement, issuances of
Common Stock pursuant to the exercise of such options or the exercise of
any other employee stock options outstanding on the date of the Terms
Agreement or issuances of Common Stock pursuant to the Company's dividend
reinvestment plan.
5. Conditions of the Obligations of the Underwriters. The obligations of
the several Underwriters to purchase and pay for the Offered Securities will be
subject to the accuracy of the representations and warranties on the part of the
Company herein, to the accuracy of the statements of Company officers made
pursuant to the provisions hereof, to the performance by the Company of its
obligations hereunder and to the following additional conditions precedent:
(a) On or prior to the date of the Terms Agreement, the
Representatives shall have received a letter, dated the date of delivery
thereof, of Arthur Andersen confirming that they are independent public
accountants within the meaning of the Act and the applicable published
Rules and Regulations thereunder and stating to the effect that:
(i) in their opinion the financial statements and any schedules
and any summary of earnings examined by them and included in the
Prospectus comply as to form in all material respects with the
applicable accounting requirements of the Act and the related
published Rules and Regulations;
(ii) they have performed the procedures specified by the
American Institute of Certified Public Accountants for a review of
interim financial information as described in Statement of Auditing
Standards No. 71, Interim Financial Information, on any unaudited
financial statements included in the Registration Statement;
(iii) on the basis of the review referred to in clause (ii)
above, a reading of the latest available interim financial statements
of the Company, inquiries of officials of the Company who have
responsibility for financial and accounting matters and other
specified procedures, nothing came to their attention that caused them
to believe that:
6
<PAGE>
(A) the unaudited financial statements, if any, and any
summary of earnings included in the Prospectus do not comply as
to form in all material respects with the applicable accounting
requirements of the Act and the related published Rules and
Regulations or any material modifications should be made to such
unaudited financial statements and summary of earnings for them
to be in conformity with generally accepted accounting
principles;
(B) if any unaudited "capsule" information is contained in
the Prospectus, the unaudited consolidated net sales, net
operating income, net income and net income per share amounts or
other amounts constituting such "capsule" information and
described in such letter do not agree with the corresponding
amounts set forth in the unaudited consolidated financial
statements or were not determined on a basis substantially
consistent with that of the corresponding amounts in the audited
statements of income;
(C) at the date of the latest available balance sheet read
by such accountants, or at a subsequent specified date not more
than three business days prior to the date of the Terms
Agreement, there was any change in the capital stock or any
increase in short-term indebtedness or long-term debt of the
Company and its consolidated subsidiaries or, at the date of the
latest available balance sheet read by such accountants, there
was any decrease in consolidated [net current assets or] net
assets, as compared with amounts shown on the latest balance
sheet included in the Prospectus; or
(D) for the period from the closing date of the latest
income statement included in the Prospectus to the closing date
of the latest available income statement read by such accountants
there were any decreases, as compared with the corresponding
period of the previous year and with the period of corresponding
length ended the date of the latest income statement included in
the Prospectus, in consolidated net sales, net operating income
in the total or (if the Offered Securities are Common Stock or
are convertible into Common Stock) per share amounts of
consolidated income before extraordinary items or net income (if
the Offered Securities are debt securities) in the ratio of
earnings to fixed charges or (if the Offered Securities are
preferred stock) in the ratio of earnings to fixed charges and
preferred stock dividends combined;
except in all cases set forth in clauses (C) and (D) above for
changes, increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter; and
(iv) they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information
contained in the Prospectus (in each case to the extent that such
dollar amounts, percentages and other financial information are
derived from the general accounting records of the Company and its
subsidiaries subject to the internal controls of the Company's
accounting system or are derived directly from such records by
analysis or computation) with the results obtained from inquiries, a
reading of such general accounting records and other procedures
specified in such letter and have found such dollar amounts,
percentages and other financial information to be in agreement with
such results, except as otherwise specified in such letter.
All financial statements and schedules included in material incorporated by
reference into the Prospectus shall be deemed included in the Prospectus
for purposes of this subsection.
(b) The Prospectus shall have been filed with the Commission in
accordance with the Rules and Regulations and Section 4(a) of this
Agreement. No stop order suspending the effectiveness of the Registration
Statement or of any part thereof shall have been issued and no proceedings
for that purpose shall have been instituted or, to the knowledge of the
Company or any Underwriter, shall be contemplated by the Commission.
(c) Subsequent to the execution of the Terms Agreement, there shall
not have occurred (i) any change, or any development or event involving a
prospective change, in the condition (financial or other),
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business, properties or results of operations of the Company or its
subsidiaries which, in the judgment of a majority in interest of the
Underwriters including any Representatives, is material and adverse and
makes it impractical or inadvisable to proceed with completion of the
public offering or the sale of and payment for the Offered Securities; (ii)
any downgrading in the rating of any debt securities or preferred stock of
the Company by any "nationally recognized statistical rating organization"
(as defined for purposes of Rule 436(g) under the Act), or any public
announcement that any such organization has under surveillance or review
its rating of any debt securities or preferred stock of the Company (other
than an announcement with positive implications of a possible upgrading,
and no implication of a possible downgrading, of such rating); (iii) any
suspension or limitation of trading in securities generally on the New York
Stock Exchange, or any setting of minimum prices for trading on such
exchange, or any suspension of trading of any securities of the Company on
any exchange or in the over-the-counter market; (iv) any banking moratorium
declared by U.S. Federal, New York, or United Kingdom authorities; or (v)
any outbreak or escalation of major hostilities in which the United States
is involved, any declaration of war by Congress or any other substantial
national or international calamity or emergency if, in the judgment of a
majority in interest of the Underwriters including any Representatives, the
effect of any such outbreak, escalation, declaration, calamity or emergency
makes it impractical or inadvisable to proceed with completion of the
public offering or the sale of and payment for the Offered Securities.
(d) (1) The Representatives shall have received an opinion, dated the
Closing Date, of Cravath, Swaine & Moore, counsel for the Company,
substantially to the effect that:
(i) Based solely on a certificate from the Secretary of State of
Delaware, the Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware,
with full corporate power and authority to own, lease and operate its
properties and conduct its businesses as described in the Prospectus.
Based solely on certificates from the Secretary of State of the
Commonwealth of Massachusetts, the Secretary of State of the State of
Connecticut and an officer of the Company, the Company is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in the United States in which the
ownership or leasing of its properties or the conduct of its business
requires such qualification, other than jurisdictions in which the
failure so to qualify would not have a material adverse effect on the
Company and its subsidiaries taken as a whole;
(ii) Based solely on a certificate from the Secretary of State
of Delaware, ChiRex America Inc. is a corporation duly incorporated,
validly existing and in good standing under the laws of the State of
Delaware. ChiRex America Inc. has full corporate power and authority
to own, lease and operate its properties and conduct its businesses as
described in the Prospectus. Based solely on a certificate from the
Secretary of State of the Commonwealth of Massachusetts and a
certificate from an officer of the Company, ChiRex America Inc. is
duly qualified as a foreign corporation to transact business and is in
good standing in each jurisdiction in the United States in which the
ownership or leasing of its properties or the conduct of its business
requires such qualification, other than jurisdictions in which the
failure so to qualify would not have a material adverse effect on the
Company and its subsidiaries taken as a whole;
(iii) Based solely on a certificate from the Secretary of State
of Delaware, ChiRex Technology Center Inc. is a corporation duly
incorporated, validly existing and in good standing under the laws of
the State of Delaware, with full corporate power and authority to own,
lease and operate its properties and conduct its businesses as
described in the Prospectus. Based solely on a certificate from the
Secretary of State of the Commonwealth of Massachusetts and a
certificate from an officer of the Company, ChiRex Technology Center
Inc. is duly qualified as a foreign corporation to transact business
and is in good standing in each jurisdiction in the United States in
which the ownership or leasing of its properties or the conduct of its
business requires such qualification, other than jurisdictions in
which the failure so to qualify would not have a material adverse
effect on the Company and its subsidiaries taken as a whole;
(iv) With respect to Debt Securities to be issued under the
Indenture, when (A) the Trustee is qualified to act as Trustee under
the Indenture, (B) the Trustee has duly executed and delivered the
Indenture, (C) the Indenture has been duly authorized and validly
executed and delivered by the Company to the Trustee, (D) the
Indenture has been duly qualified under the Trust Indenture Act of
1939, as amended, (E) the Board of Directors of the Company or a duly
constituted and acting committee thereof (such Board of Directors or
committee being hereinafter referred to as the "Board") has taken all
necessary corporate action to approve the issuance and terms of such
Debt Securities, the terms of the offering thereof and related
matters, and (F) such Debt Securities have been duly executed,
authenticated, issued and delivered in accordance with the provisions
of the Indenture, and the applicable definitive purchase, underwriting
or similar agreement approved by the Board upon payment of the
consideration therefor provided for therein, such Debt Securities will
be validly issued and will constitute valid and binding obligations of
the Company, enforceable against the Company in accordance with their
8
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terms (subject to applicable bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws affecting
creditors' rights generally from time to time in effect and subject to
general principles of equity, regardless of whether considered in a
proceeding in equity or at law);
(v) With respect to shares of Preferred Stock, when both (A) the
Board has taken all necessary corporate action to approve the issuance
and terms of the shares of Preferred Stock, the terms of the offering
thereof and related matters, including the adoption of a Certificate
of Designation relating to such Preferred Stock and the filing of the
Certificate of Designation with the Secretary of State of the State of
Delaware, and (B) certificates representing the shares of Preferred
Stock have been duly executed, countersigned, registered and delivered
either (i) in accordance with the applicable definitive purchase,
underwriting or similar agreement approved by the Board upon payment
of the consideration therefor (not less than the par value of the
Preferred Stock) provided for therein or (ii) upon conversion or
exercise of any other Offered Security, in accordance with the terms
of such Offered Security or the instrument governing such Offered
Security providing for such conversion or exercise as approved by the
Board, for the consideration approved by the Board (not less than the
par value of the Preferred Stock), then the shares of Preferred Stock
will be validly issued, fully paid and nonassessable;
(vi) With respect to Depositary Shares, when (A) the Board has
taken all necessary corporate action to approve the issuance and terms
of the Depositary Shares, the terms of the offering thereof and
related matters, including the adoption of a Certificate of
Designation relating to the Preferred Stock underlying such Depositary
Shares and the filing of the Certificate of Designation relating to
the Preferred Stock underlying such Depositary Shares with the
Secretary of State of the State of Delaware, (B) the Deposit Agreement
or Agreements relating to the Depositary Shares and the related
depositary receipts have been duly authorized and validly executed and
delivered by the Company and the Depositary appointed by the Company,
(C) the shares of Preferred Stock underlying such Depositary Shares
have been deposited with a bank or trust company (which meets the
requirements for the Depositary set forth in the Registration
Statement) under the applicable Deposit Agreement, and (D) the
depositary receipts representing the Depositary Shares have been duly
executed, countersigned, registered and delivered in accordance with
the appropriate Deposit Agreement and the applicable definitive
purchase, underwriting or similar agreement approved by the Board upon
payment of the consideration therefor provided for therein, the
Depositary Shares will be validly issued;
(vii) With respect to shares of Common Stock, when both (A) the
Board has taken all necessary corporate action to approve the issuance
of and the terms of the offering of the shares of Common Stock and
related matters and (B) certificates representing the shares of Common
Stock have been duly executed, countersigned, registered and delivered
either (i) in accordance with the applicable definitive purchase,
underwriting or similar agreement approved by the Board upon payment
of the consideration therefor (not less than the par value of the
Common Stock) provided for therein or (ii) upon conversion or exercise
of any other Offered Security, in accordance with the terms of such
Offered Security or the instrument governing such Offered Security
providing for such conversion or exercise as approved by the Board,
for the consideration approved by the Board (not less than the par
value of the Common Stock), then the shares of Common Stock will be
validly issued, fully paid and nonassessable;
(viii) With respect to the Warrants, when (A) the Board has
taken all necessary corporate action to approve the creation of and
the issuance and terms of the Warrants, the terms of the offering
thereof and related matters, (B) the Warrant Agreement or Agreements
relating to the Warrants have been duly authorized and validly
executed and delivered by the Company and the warrant agent appointed
by the Company and (C) the Warrants or certificates representing the
Warrants have been duly executed, countersigned, registered and
delivered in accordance with the appropriate Warrant Agreement or
Agreements and the applicable definitive purchase, underwriting or
similar agreement approved by the Board upon payment of the
consideration therefor provided for therein, the Warrants will be
validly issued;
(ix) If the Offered Securities are Common Stock or are
convertible into Common Stock: The Company's authorized equity
capitalization is as set forth in the Prospectus; the Shares conform
in all material respects to the description thereof contained in the
Registration Statement and Prospectus; and holders of outstanding
shares of Common Stock of the Company are not entitled to statutory or
contractual preemptive rights in connection with the issuance of the
Shares;
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<PAGE>
(x) If the Offered Securities are Common Stock or are
convertible into Common Stock: The Shares have been duly and validly
authorized and, when issued and delivered to and paid for by the
Underwriters pursuant to the Terms Agreement, will be validly issued,
fully paid and nonassessable. The Shares have been duly authorized for
trading on The Nasdaq Stock Market's National Market. The certificates
for the Shares are in valid and sufficient form;
(xi) If the Offered Securities are Common Stock or are
convertible into Common Stock: Except as disclosed in the Prospectus,
there are no contracts, agreements or understandings known to us
between the Company and any person granting such person the right to
require the Company to file a registration statement under the
Securities Act with respect to any securities of the Company owned or
to be owned by such person or to require the Company to include such
securities in the securities registered pursuant to the Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Securities Act;
(xii) No authorization, approval or other action by, and no
notice to, consent of, order of, or filing with, any United States
Federal, New York or, to the extent required under the General
Corporation Law of the State of Delaware, Delaware governmental agency
or body or any court is required for the consummation of the
transactions contemplated by the Terms Agreement (including the
provisions of this Agreement) in connection with the issuance or sale
of the Offered Securities by the Company, except such as have been
obtained and made under the Act and, if the Offered Securities are
debt securities, the Trust Indenture Act and such as may be required
under the blue sky laws of any jurisdication in connection with the
purchase and distribution of the Offered Securities by the
Underwriters;
(xiii) None of the issue and sale of the Offered Securities, the
consummation of any other of the transactions contemplated by the
Terms Agreement and the performance of the Terms Agreement (i) will
conflict with, result in a breach of, or constitute a default under,
the Certificate of Incorporation, as amended, or the Amended and
Restated By-laws of the Company, or the terms of any indenture or
other agreement or instrument to which the Company or any of its
subsidiaries is a party or bound and which is listed as an exhibit to
the Company's Annual Report on Form 10-K for [ ], or (ii) will
contravene any law, rule or regulation of the United States or the
State of New York or the General Corporation Law of the State of
Delaware, or, to our knowledge, any order or decree of any court or
government agency or instrumentality. In connection with the
foregoing, we point out that certain of the agreements referred to in
clause (i) above are or may be governed by laws other than the laws of
the State of New York. For purposes of the opinion expressed in this
paragraph, however, we have assumed that all such agreements are
governed by and would be interpreted in accordance with the laws of
the State of New York;
(xiv) The Registration Statement has become effective under the
Act, as of [ ], and thereupon the offering of the Offered
Securities as contemplated by the Prospectus became registered under
the Securities Act, and, to the best of the knowledge of such counsel,
no stop order suspending the effectiveness of the Registration
Statement or any part thereof has been issued and no proceedings for
that purpose have been instituted or are pending or contemplated under
the Act, and the work of such counsel did not disclose any information
that gave such counsel reason the believe that: the registration
statement relating to the Registered Securities, as of its effective
date, the Prospectus, as of the date of the Terms Agreement, and any
amendment or supplement thereto, as of its date, was not appropriately
responsive in all material respects to the requirements of the Act and
(if the Offered Securities are Debt Securities) the Trust Indenture
Act and the Rules and Regulations or such registration statement, as
of its effective date, the Registration Statement, as of the date of
the Terms Agreement or as of the Closing Date, or any amendment
thereto, as of its date or as of the Closing Date, contained any
untrue statement of a material fact or omitted to state any material
fact required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus, as of the date of the
Terms Agreement or as of such Closing Date, or any amendment or
supplement thereto, as of its date or as of the Closing Date,
contained any untrue statement of a material fact or omitted to state
any material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading; it being understood that such counsel need express
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<PAGE>
no opinion as to the financial statements or other financial data
contained in the Registration Statement or the Prospectus;
(xv) The Terms Agreement (including the provisions of this
Agreement) and any Delayed Delivery Contracts and, if the Offered
Securities are debt securities or preferred stock, any Delayed
Delivery Contracts have been duly authorized, executed and delivered
by the Company;
(xvi) The statements made in the Prospectus under the caption
"Description of Capital Stock", insofar as they purport to constitute
summaries of the terms of the Offered Securities, and under the
caption "Certain United States Tax Consequences to Non-United States
Holders", insofar as they purport to describe the material tax
consequences of an investment in Offered Securities, fairly summarize
the matters therein described;
(xvii) The Registration Statement became effective as of [ ],
and thereupon the offering of the Offered Securities as contemplated
by the Prospectus became registered under the Securities Act and, to
our knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or are pending or contemplated under the
Securities Act; and
(xviii) The Company is not and, after giving effect to the
offering and sale of the Offered Securities and the application of the
proceeds thereof as described in the Prospectus, will not be an
"investment company" as defined in the Investment Company Act of 1940.
For purposes of the opinions delivered pursuant to clauses (i) through
(xviii) of this Section 6(d)(1), the term "subsidiaries" shall not include
either ChiRex (Holdings) Limited, ChiRex (Dudley) Limited or ChiRex (Annan)
Limited.
(2) The Representatives shall have received an opinion, dated the
Closing Date, of Dibb Lupton Alsop, U.K. counsel for the Company and its
subsidiaries, substantially to the effect that:
(i) ChiRex (Holdings) Limited ("HOLDINGS"), ChiRex (Dudley)
Limited ("DUDLEY") and ChiRex (Annan) Limited ("ANNAN") have been duly
incorporated and are validly existing as corporations in good standing
under the laws of England and Wales, and have full corporate power and
authority to conduct their business as described in the Registration
Statement;
(ii) All of the issued shares of capital stock of Holdings,
Dudley and Annan have been duly and validly authorized and issued, are
fully paid and none of the shareholders holding such shares have any
liability to contribute to Holdings, Dudley and Annan any further
funds in respect of or relating to their acquisition of such shares.
(iii) To such counsel's knowledge, neither Holdings, Dudley or
Annan are in violation of its Memorandum or Articles of Association.
(e) The Representatives shall have received from . counsel
for the Underwriters, such opinion or opinions, dated the Closing Date,
with respect to the incorporation of the Company, the validity of the
Offered Securities, the Registration Statement, the Prospectus and other
related matters as the Representatives may require, and the Company shall
have furnished to such counsel such documents as they request for the
purpose of enabling them to pass upon such matters. In rendering such
opinion, . may rely as to the incorporation of the Company and all
other matters governed by United Kingdom law upon the opinion of Dibb
Lupton Alsop referred to above.
(f) The Representatives shall have received a certificate, dated the
Closing Date, of the President or any Vice President and a principal
financial or accounting officer of the Company in which such
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<PAGE>
officers, to the best of their knowledge after reasonable investigation,
shall state that the representations and warranties of the Company in this
Agreement are true and correct, that the Company has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied hereunder at or prior to the Closing Date,that no stop order
suspending the effectiveness of the Registration Statetement or of any part
thereof has been issued and no proceedings for that purpose have been
instituted or are contemplated by the Commission and that, subsequent to
the date of the most recent financial statements in the Prospectus, there
has been no material adverse change, nor any development or event involving
a prospective material adverse change, in the condition (financial or
other), business, properties or results of operations of the Company and
its subsidiaries taken as a whole except as set forth in or contemplated by
the Prospectus or as described in such certificate.
(g) The Representatives shall have received a letter, dated the
Closing Date, of Arthur Andersen which meets the requirements of
subsections (a) of this Section, except that the specified date referred to
in such subsection will be a date not more than three business days prior
to the Closing Date for the purposes of this subsection.
The Company will furnish the Representatives with such conformed copies of such
opinions, certificates, letters and documents as the Representatives reasonably
request. The Lead Underwriter may in its sole discretion waive on behalf of the
Underwriters compliance with any conditions to the obligations of the
Underwriters under this Agreement and the Terms Agreement.
6. Indemnification and Contribution. (a) The Company will indemnify and
hold harmless each Underwriter against any losses, claims, damages or
liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus or preliminary prospectus
supplement, or arise out of or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, and will reimburse each Underwriter
for any legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred; provided, however, that the
Company will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement in or omission or alleged omission from any of such
documents in reliance upon and in conformity with written information furnished
to the Company by any Underwriter through the Representatives, if any,
specifically for use therein, it being understood and agreed that the only such
information furnished by any Underwriter consists of the information described
as such in the Terms Agreement.
(b) Each Underwriter will severally and not jointly indemnify and hold
harmless the Company against any losses, claims, damages or liabilities to which
the Company may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any related preliminary prospectus or
preliminary prospectus supplement, or arise out of or are based upon the
omission or the alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information furnished to the Company by such
Underwriter through the Representatives, if any, specifically for use therein,
and will reimburse any legal or other expenses reasonably incurred by the
Company in connection with investigating or defending any such loss, claim,
damage, liability or action as such expenses are incurred, it being understood
and agreed that the only such information furnished by any Underwriter consists
of the information described as such in the Terms Agreement.
(c) Promptly after receipt by an indemnified party under this Section of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
under subsection (a) or (b) above. In case any such action is brought against
any indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party), and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such indemnified
party under this Section for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened action in respect of which any indemnified party is or
could have been a party and indemnity
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<PAGE>
could have been sought hereunder by such indemnified party unless such
settlement includes an unconditional release of such indemnified party from all
liability on any claims that are the subject matter of such action.
(d) If the indemnification provided for in this Section is unavailable or
insufficient to hold harmless an indemnified party under subsection (a) or (b)
above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in subsection (a) or (b) above (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the other from the offering of the Offered
Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses) received
by the Company bear to the total underwriting discounts and commissions received
by the Underwriters. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company or the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The amount paid by an indemnified
party as a result of the losses, claims, damages or liabilities referred to in
the first sentence of this subsection (d) shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any action or claim which is the subject of this
subsection (d). Notwithstanding the provisions of this subsection (d), no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Offered Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The Underwriters' obligations in
this subsection (d) to contribute are several in proportion to their respective
underwriting obligations and not joint.
(e) The obligations of the Company under this Section shall be in addition
to any liability which the Company may otherwise have and shall extend, upon the
same terms and conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act; and the obligations of the Underwriters under
this Section shall be in addition to any liability which the respective
Underwriters may otherwise have and shall extend, upon the same terms and
conditions, to each director of the Company, to each officer of the Company who
has signed the Registration Statement and to each person, if any, who controls
the Company within the meaning of the Act.
7. Default of Underwriters. If any Underwriter or Underwriters default in
their obligations to purchase Offered Securities under the Terms Agreement and
the aggregate principal amount (if debt securities) or number of shares (if
preferred stock or Common Stock) of Offered Securities that such defaulting
Underwriter or Underwriters agreed but failed to purchase does not exceed 10% of
the total principal amount (if debt securities) or number of shares (if
preferred stock or Common Stock) of Offered Securities, the Lead Underwriter may
make arrangements satisfactory to the Company for the purchase of such Offered
Securities by other persons, including any of the Underwriters, but if no such
arrangements are made by the Closing Date, the non-defaulting Underwriters shall
be obligated severally, in proportion to their respective commitments under the
Terms Agreement (including the provisions of this Agreement), to purchase the
Offered Securities that such defaulting Underwriters agreed but failed to
purchase. If any Underwriter or Underwriters so default and the aggregate
principal amount (if debt securities) or number of shares (if preferred stock or
Common Stock) of Offered Securities with respect to which such default or
defaults occur exceeds 10% of the total principal amount (if debt securities) or
number of shares (if preferred stock or Common Stock) of Offered Securities and
arrangements satisfactory to the Lead Underwriter and the Company for the
purchase of such Offered Securities by other persons are not made within 36
hours after such default, the Terms Agreement will terminate without liability
on the part of any non-defaulting Underwriter or the Company, except as provided
in Section 8. As used in this Agreement, the term "Underwriter" includes any
person substituted for an Underwriter under this Section. Nothing herein will
relieve a defaulting Underwriter from liability for its default. If the Offered
Securities are debt securities or preferred stock, the respective commitments of
the several Underwriters for the purposes of this Section shall be determined
without regard to reduction in the respective Underwriters' obligations to
purchase the principal amounts (if debt securities) or numbers of shares (if
preferred stock) of the Offered Securities set forth opposite their names in the
Terms Agreement as a result of Delayed Delivery Contracts entered into by the
Company.
8. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the several Underwriters set forth in or made
pursuant to the Terms Agreement (including the provisions of this Agreement)
will remain in full force and effect, regardless of any investigation, or
statement as to the results thereof, made by or on behalf of any Underwriter,
the Company or any of their respective representatives, officers or directors or
any controlling person,
13
<PAGE>
and will survive delivery of and payment for the Offered Securities. If the
Terms Agreement is terminated pursuant to Section 7 or if for any reason the
purchase of the Offered Securities by the Underwriters is not consummated, the
Company shall remain responsible for the expenses to be paid or reimbursed by it
pursuant to Section 4 and the respective obligations of the Company and the
Underwriters pursuant to Section 6 shall remain in effect. If the purchase of
the Offered Securities by the Underwriters is not consummated for any reason
other than solely because of the termination of the Terms Agreement pursuant to
Section 7 or the occurrence of any event specified in clause (iii), (iv) or (v)
of Section 5(c), the Company will reimburse the Underwriters for all out-of-
pocket expenses (including fees and disbursements of counsel) reasonably
incurred by them in connection with the offering of the Offered Securities.
9. Notices. All communications hereunder will be in writing and, if sent
to the Underwriters, will be mailed, delivered or telegraphed and confirmed to
them at their address furnished to the Company in writing for the purpose of
communications hereunder or, if sent to the Company, will be mailed, delivered
or telegraphed and confirmed to it at 300 Atlantic Street, Suite 402, Stamford,
CT 06901, Attention: Michael Griffith.
10. Successors. The Terms Agreement (including the provisions of this
Agreement) will inure to the benefit of and be binding upon the Company and such
Underwriters as are identified in the Terms Agreement and their respective
successors and the officers and directors and controlling persons referred to in
Section 6, and no other person will have any right or obligation hereunder.
11. Representation of Underwriters. Any Representatives will act for the
several Underwriters in connection with the financing described in the Terms
Agreement, and any action under such Terms Agreement (including the provisions
of this Agreement) taken by the Representatives jointly or by the Lead
Underwriter will be binding upon all the Underwriters.
12. Counterparts. The Terms Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
13. APPLICABLE LAW. THIS AGREEMENT AND THE TERMS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
The Company hereby submits to the non-exclusive jurisdiction of the Federal
and state courts in the Borough of Manhattan in The City of New York in any suit
or proceeding arising out of or relating to the Terms Agreement (including the
provisions of this Agreement) or the transactions contemplated thereby.
14
<PAGE>
ANNEX I
(Three copies of this Delayed Delivery Contract should be signed and returned
to the address shown below so as to arrive not later than 9:00 A.M.,
New York time, on _____________________________________, 19___/(1)/)
DELAYED DELIVERY CONTRACT
-------------------------
[Insert date of initial public offering]
ChiRex Inc.
c/o [ ]
Eleven Madison Avenue
New York, N.Y. 10010-3629
Attention: Investment Banking Department - Transactions Advisory Group
Gentlemen:
The undersigned hereby agrees to purchase from ChiRex Inc., a Delaware
corporation ("COMPANY"), and the Company agrees to sell to the undersigned, [If
one delayed closing, insert--as of the date hereof, for delivery on
______________, 19__ ("DELIVERY DATE"),]
[$]..............[shares]
- --principal amount--of the Company's [Insert title of securities]
("SECURITIES"), offered by the Company's Prospectus dated __________, 19__ and a
Prospectus Supplement dated _____________________, 19__ relating thereto,
receipt of copies of which is hereby acknowledged, at--___% of the principal
amount thereof plus accrued interest, if any,--$_____ per share plus accrued
dividends, if any,--and on the further terms and conditions set forth in this
Delayed Delivery Contract ("CONTRACT").
[If two or more delayed closings, insert the following:
The undersigned will purchase from the Company as of the date hereof, for
delivery on the dates set forth below, Securities in the--principal--amounts set
forth below:
PRINCIPAL AMOUNT
- ----------------
NUMBER
DELIVERY DATE OF SHARES
- -----------------------
.............................................. .............
.............................................. .............
Each of such delivery dates is hereinafter referred to as a Delivery Date.]
Payment for the Securities that the undersigned has agreed to purchase for
delivery on--the--each--Delivery Date shall be made to the Company or its order
by certified or official bank check in New York Clearing House (next day) funds
at the office of ____________________ at ______.M. on--the--such--Delivery Date
upon delivery to the undersigned of the Securities to be purchased by the
undersigned--for delivery on such Delivery Date--in definitive [If debt issue,
insert--fully registered] form and in
- ---------------------------
/(1)/ Insert date which is third full business day prior to Closing Date
under the Terms Agreement.
15
<PAGE>
such denominations and registered in such names as the undersigned may designate
by written or telegraphic communication addressed to the Company not less than
five full business days prior to--the--such--Delivery Date.
It is expressly agreed that the provisions for delayed delivery and payment
are for the sole convenience of the undersigned; that the purchase hereunder of
Securities is to be regarded in all respects as a purchase as of the date of
this Contract; that the obligation of the Company to make delivery of and
accept payment for, and the obligation of the undersigned to take delivery of
and make payment for, Securities on--the--each--Delivery Date shall be subject
only to the conditions that (1) investment in the Securities shall not at--the--
such--Delivery Date be prohibited under the laws of any jurisdiction in the
United States to which the undersigned is subject and (2) the Company shall have
sold to the Underwriters the total--principal amount--number of shares--of the
Securities less the--principal amount---number of shares--thereof covered by
this and other similar Contracts. The undersigned represents that its
investment in the Securities is not, as of the date hereof, prohibited under the
laws of any jurisdiction to which the undersigned is subject and which governs
such investment.
Promptly after completion of the sale to the Underwriters the Company will
mail or deliver to the undersigned at its address set forth below notice to such
effect, accompanied by--a copy--copies--of the opinion[s] of counsel for the
Company delivered to the Underwriters in connection therewith.
This Contract will inure to the benefit of and be binding upon the parties
hereto and their respective successors, but will not be assignable by either
party hereto without the written consent of the other.
It is understood that the acceptance of any such Contract is in the
Company's sole discretion and, without limiting the foregoing, need not be on a
first-come, first-served basis. If this Contract is acceptable to the Company,
it is requested that the Company sign the form of acceptance below and mail or
deliver one of the counterparts hereof to the undersigned at its address set
forth below. This will become a binding contract between the Company and the
undersigned when such counterpart is so mailed or delivered.
Yours very truly,
......................................................
(Name of Purchaser)
By....................................................
......................................................
(Title of Signatory)
......................................................
......................................................
(Address of Purchaser)
Accepted, as of the above date.
[Insert Name of Issuer]
By....................................................
[Insert Title]
16
<PAGE>
CHIREX INC.
("COMPANY")
DEBT SECURITIES
TERMS AGREEMENT
---------------
____________, 19__
To: The [Representative[s] of the] Underwriters identified herein
Dear Sirs:
The undersigned agrees to sell to the several Underwriters named [in
Schedule A hereto] [below] for their respective accounts, on and subject to the
terms and conditions of the Underwriting Agreement filed as an exhibit to the
Company's registration statement on Form S-3 (No. 333-____) ("UNDERWRITING
AGREEMENT"), the following securities ("OFFERED SECURITIES") on the following
terms:
TITLE: [__%] [Floating Rate]--Notes--Debentures--Bonds--Due____________.
PRINCIPAL AMOUNT: $___________.
INTEREST: [__% per annum, from __________, 19__, payable semiannually on
__________ and ___________, commencing ___________ _, 19__, to holders of
record on the preceding _____________ or __________, as the case may be.]
[Zero coupon.]
MATURITY: _____________, 19__.
OPTIONAL REDEMPTION:
SINKING FUND:
LISTING: [None.] [ Stock Exchange.] [The Nasdaq Stock Market Inc.'s
National Market.]
DELAYED DELIVERY CONTRACTS: [None.] [Delivery Date[s] shall be
_____________, 19__. Underwriters' fee is ___% of the principal amount of
the Contract Securities.]
PURCHASE PRICE: ______% of principal amount, plus accrued interest[, if
any,] from _______________, 19__.
EXPECTED REOFFERING PRICE: ___% of principal amount, subject to change by
the [Representative[s] [Underwriters].
CLOSING: ____________A.M. on ________________, 19_____, at _____________,
in Federal (same day) funds.
SETTLEMENT AND TRADING: [Physical certificated form.] [Book-Entry Only via
DTC. The Offered Securities will trade in DTC's Same Day Funds Settlement
System.]
BLACKOUT: Until _____ days after the Closing Date.
[NAME[S] AND ADDRESS[ES] OF [REPRESENTATIVE[S]] [UNDERWRITER[S]]:]
17
<PAGE>
The respective principal amounts of the Offered Securities to be
purchased by each of the Underwriters are set forth opposite their names in
Schedule A hereto.
The provisions of the Underwriting Agreement are incorporated herein
by reference.
The Offered Securities will be made available for checking and
packaging at the office of ________________________ at least 24 hours prior
to the Closing Date.
For purposes of Section 6 of the Underwriting Agreement, the only
information furnished to the Company by any Underwriter for use in the
Prospectus consists of [(i)] the following information in the Prospectus
furnished on behalf of each Underwriter: the last paragraph at the bottom
of the prospectus supplement cover page concerning the terms of the
offering by the Underwriters, the legend concerning over-allotments--and--,
--stabilizing [and passive market making] on the inside front cover page of
the prospectus supplement--and--, --the concession and reallowance figures
appearing in the paragraph under the caption "Underwriting" in the
prospectus supplement [If paragraph regarding passive market making is
included, insert--and the information contained in the paragraph under the
caption "Underwriting" in the prospectus supplement] [If applicable,
insert--; and (ii) the following information in the prospectus supplement
furnished on behalf of [insert name of Underwriter]: [insert description of
information, such as material relationship disclosure under the caption
"Underwriting" in the prospectus supplement].
If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to the Company one of the counterparts hereof, whereupon
it will become a binding agreement between the Company and the several
Underwriters in accordance with its terms.
Very truly yours,
[Insert Name of Issuer]
By..........................................
[Insert title]__________________
The foregoing Terms Agreement is hereby confirmed and accepted as of the date
first above written.
[If no co-representative, use first confirmation form. If co-representative,
use second.]
[ ]
By..................................................................
[Insert title]
[Acting on behalf of itself and as the
Representative of the several
Underwriters.]
[ ]
..........................................................
.........................................................,
[Acting on behalf of themselves and as the
Representatives of the several Underwriters.]
By [ ]
By..................................................................
[Insert title]
18
<PAGE>
SCHEDULE A
UNDERWRITER PRINCIPAL
----------- AMOUNT
---------
[ ]................................. $___________
[ ]................................. ___________
-----------
Total........................... $
===========
19
<PAGE>
CHIREX INC.
("COMPANY")
PREFERRED--COMMON--STOCK
TERMS AGREEMENT
---------------
___ ________, 19__
To: The [Representative[s] of the] Underwriters identified herein
Dear Sirs:
The undersigned agrees to sell to the several Underwriters named [in
Schedule A hereto] [below] for their respective accounts, on and subject to the
terms and conditions of the Underwriting Agreement filed as an exhibit to the
Company's registration statement on Form S-3 (No. 33-____) ("UNDERWRITING
AGREEMENT"), the following securities ("OFFERED SECURITIES") on the following
terms:
TITLE:
NUMBER OF SHARES:
DIVIDEND RATE:
/(1)/ OPTIONAL REDEMPTION:
/(1)/ SINKING FUND:
/(1)/ LISTING: [None.] [ Stock Exchange.] [The Nasdaq Stock Market.]
/(1)/ DELAYED DELIVERY CONTRACTS: [None.] [Delivery Date[s] shall be
_____________, 19__. Underwriters' fee is $_________ per share of the
Contract Securities.]
PURCHASE PRICE: $______ per share [If preferred stock issue, insert--
plus accrued dividends[, if any,] from _______________, 19__].
EXPECTED REOFFERING PRICE: $___ _ per share, subject to change by the
[Representative[s]] [Underwriters].
CLOSING: ____________A.M. on ________________, 19______, at
_______________, in New York Clearing House (next day) funds.
UNDERWRITER[S']['S] COMPENSATION: $_______ payable to the
[Representative[s] for the proportionate accounts of the]
Underwriter[s] on the Closing Date.
BLACKOUT: Until ___days after the Closing Date.
[NAME[S] AND ADDRESS[ES] OF [REPRESENTATIVE[S]] [UNDERWRITER[S]]:]
The respective numbers of shares of the Offered Securities to be
purchased by each of the Underwriters are set forth opposite their names in
Schedule A hereto.
20
<PAGE>
The provisions of the Underwriting Agreement are incorporated herein
by reference.
The Offered Securities will be made available for checking and
packaging at the office of _________ at least 24 hours prior to the Closing
Date.
For purposes of Section 6 of the Underwriting Agreement, the only
information furnished to the Company by any Underwriter for use in the
Prospectus consists of [(i)] the following information in the Prospectus
furnished on behalf of each Underwriter: the last paragraph at the bottom of the
prospectus supplement cover page concerning the terms of the offering by the
Underwriters, the legend concerning over-allotments--and--, --stabilizing [and
passive market making] on the inside front cover page of the prospectus
supplement--and--, --the concession and reallowance figures appearing in the
paragraph under the caption "Underwriting" in the prospectus supplement [If
paragraph regarding passive market making is included, insert--and the
information contained in the paragraph under the caption "Underwriting" in the
prospectus supplement] [If applicable, insert--; and (ii) the following
information in the prospectus supplement furnished on behalf of [insert name of
Underwriter]: [insert description of information, such as material relationship
disclosure under the caption "Underwriting" in the prospectus supplement].
21
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to the Company one of the counterparts hereof,
whereupon it will become a binding agreement between the Company and the several
Underwriters in accordance with its terms.
Very truly yours,
[Insert Name of Issuer]
By..........................................
[Insert title]__________________
The foregoing Terms Agreement is hereby confirmed and accepted as of the date
first above written.
[If no co-representative, use first confirmation form. If co-representative,
use second.]
[ ]
By..................................................................
[Insert title]
[Acting on behalf of itself and as the
Representative of the several
Underwriters.]
[ ]
..........................................................
.........................................................,
[Acting on behalf of themselves and as the
Representatives of the several Underwriters.]
By [ ]
By..................................................................
[Insert title]
22
<PAGE>
SCHEDULE A
UNDERWRITER NUMBER
----------- OF
SHARES
------
[ ]............................. $___________
[ ]............................. ___________
----------
Total $
==========
23
<PAGE>
EXHIBIT 5
June 3, 1999
ChiRex Inc.
-----------
Registration Statement on Form S-3
----------------------------------
Dear Ladies and Gentlemen:
We have acted as special counsel for ChiRex Inc., a Delaware
corporation (the "Company"), in connection with the filing by the Company with
the Securities and Exchange Commission (the "Commission") of a Registration
Statement on Form S-3 (the "Registration Statement") relating to (i) debt
securities of the Company, which may be senior (the "Senior Securities") or
subordinated (the "Subordinated Securities" and, collectively with the Senior
Securities, the "Debt Securities"); (ii) warrants to purchase Debt Securities
(the "Debt Warrants"); (iii) shares of preferred stock, $.01 par value per
share, of the Company (the "Preferred Stock"); (iv) warrants to purchase shares
of Preferred Stock (the "Preferred Stock Warrants"); (v) depositary shares
representing entitlement to all rights and preferences of fractional interests
in shares of Preferred Stock of a specified series (the "Depositary Shares");
(vi) Common Stock, $.01 par value per share, of the Company (the "Common
Stock"); and (vii) warrants to purchase shares of Common Stock (the "Common
Stock Warrants"). The Debt Warrants, Preferred Stock Warrants and the Common
Stock Warrants are referred to herein as the "Warrants", and the Debt
Securities, Preferred Stock, Depositary Shares, Common Stock and the Warrants
are referred to herein collectively as the "Offered Securities". The Offered
Securities being registered under the Registration Statement will have an
aggregate initial offering price of up to $104,625,000, or the equivalent
thereof in foreign currencies or composite currencies and will be offered on a
continued or delayed basis pursuant to the provisions of Rule 415 under the
Securities Act of 1933, (the "Securities Act").
<PAGE>
Unless otherwise provided in any prospectus supplement forming a part
of the Registration Statement relating to a particular series of Debt
Securities, the Debt Securities will be issued under an Indenture in the form of
Exhibit 4.4 to the Registration Statement (the "Indenture") to be executed by
the Company and United States Trust Company of New York, as Trustee (the
"Trustee"). The Preferred Stock will be issued pursuant to a Certificate of
Designations (the "Certificate of Designations") relating to a particular series
of Preferred Stock. The Depositary Shares will be issued under a Deposit
Agreement (the "Deposit Agreement") to be entered into between the Company and
an institution as identified in the Deposit Agreement. The Warrants will be
issued under one or more warrant agreements (each, a "Warrant Agreement"), each
to be entered into between the Company and one or more institutions as
identified in the applicable Warrant Agreement.
In connection with the foregoing, we have examined originals, or
copies certified or otherwise identified to our satisfaction, of such documents,
corporate records and other instruments as we have deemed necessary for the
purposes of this opinion, including without limitation the following: (a) the
Certificate of Incorporation, as amended of the Company; (b) the Amended and
Restated By-laws of the Company; (c) the Indenture; (d) the form of proposed
Deposit Agreement; (e) the form of proposed Warrant Agreement; (f) the form of
the Underwriting Agreement attached as Exhibit 1 to the Registration Statement;
and (g) the unanimous written consent of the Board of Directors of the Company.
Based upon and subject to the foregoing and assuming that (i) the
Registration Statement and any amendments thereto (including post-effective
amendments) will have become effective and comply with all applicable laws; (ii)
the Registration Statement will be effective and will comply with all applicable
laws at the time the Offered Securities are offered or issued as contemplated by
the Registration Statement; (iii) a prospectus supplement will have been
prepared and filed with the Commission describing the Offered Securities offered
thereby and will comply with all applicable laws; (iv) all Offered Securities
will be issued and sold in compliance with applicable federal and state
securities laws and in the manner stated in the Registration Statement and the
appropriate prospectus supplement; (v) a definitive purchase, underwriting or
similar agreement and any other necessary agreement with
<PAGE>
respect to any Offered Securities offered or issued will have been duly
authorized and validly executed and delivered by the Company and the other
parties thereto; and (vi) any Offered Securities issuable upon conversion,
exchange or exercise of any Offered Security being offered or issued will be
duly authorized, created and, if appropriate, reserved for issuance upon such
conversion, exchange or exercise, we are of the opinion as follows:
(1) Based solely on a certificate from the Secretary of State of
Delaware, the Company is duly incorporated and is a validly existing
corporation under the laws of the State of Delaware.
(2) With respect to Debt Securities to be issued under the Indenture,
when (A) the Trustee is qualified to act as Trustee under the Indenture,
(B) the Trustee has duly executed and delivered the Indenture, (C) the
Indenture has been duly authorized and validly executed and delivered by
the Company to the Trustee, (D) the Indenture has been duly qualified under
the Trust Indenture Act of 1939, as amended, (E) the Board of Directors of
the Company or a duly constituted and acting committee thereof (such Board
of Directors or committee being hereinafter referred to as the "Board") has
taken all necessary corporate action to approve the issuance and terms of
such Debt Securities, the terms of the offering thereof and related
matters, and (F) such Debt Securities have been duly executed,
authenticated, issued and delivered in accordance with the provisions of
the Indenture, and the applicable definitive purchase, underwriting or
similar agreement approved by the Board upon payment of the consideration
therefor provided for therein, such Debt Securities will be validly issued
and will constitute valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, (subject to
applicable bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other similar laws affecting creditors' rights generally from
time to time in effect and subject to general principles of equity,
regardless of whether considered in a proceeding in equity or at law).
(3) With respect to shares of Preferred Stock, when both (A) the
Board has taken all necessary corporate action to approve the issuance and
terms of the shares of Preferred Stock, the terms of the
<PAGE>
offering thereof and related matters, including the adoption of a
Certificate of Designation relating to such Preferred Stock and the filing
of the Certificate of Designation with the Secretary of State of the State
of Delaware, and (B) certificates representing the shares of Preferred
Stock have been duly executed, countersigned, registered and delivered
either (i) in accordance with the applicable definitive purchase,
underwriting or similar agreement approved by the Board upon payment of the
consideration therefor (not less than the par value of the Preferred Stock)
provided for therein or (ii) upon conversion or exercise of any other
Offered Security, in accordance with the terms of such Offered Security or
the instrument governing such Offered Security providing for such
conversion or exercise as approved by the Board, for the consideration
approved by the Board (not less than the par value of the Preferred Stock),
then the shares of Preferred Stock will be validly issued, fully paid and
nonassessable.
(4) With respect to Depositary Shares, when (A) the Board has taken
all necessary corporate action to approve the issuance and terms of the
Depositary Shares, the terms of the offering thereof and related matters,
including the adoption of a Certificate of Designation relating to the
Preferred Stock underlying such Depositary Shares and the filing of the
Certificate of Designation relating to the Preferred Stock underlying such
Depositary Shares with the Secretary of State of the State of Delaware, (B)
the Deposit Agreement or Agreements relating to the Depositary Shares and
the related depositary receipts have been duly authorized and validly
executed and delivered by the Company and the Depositary appointed by the
Company, (C) the shares of Preferred Stock underlying such Depositary
Shares have been deposited with a bank or trust company (which meets the
requirements for the Depositary set forth in the Registration Statement)
under the applicable Deposit Agreement, and (D) the depositary receipts
representing the Depositary Shares have been duly executed, countersigned,
registered and delivered in accordance with the appropriate Deposit
Agreement and the applicable definitive purchase, underwriting or similar
agreement approved by the Board upon payment of the
<PAGE>
consideration therefor provided for therein, the Depositary Shares will be
validly issued.
(5) With respect to shares of Common Stock, when both (A) the Board
has taken all necessary corporate action to approve the issuance of and the
terms of the offering of the shares of Common Stock and related matters and
(B) certificates representing the shares of Common Stock have been duly
executed, countersigned, registered and delivered either (i) in accordance
with the applicable definitive purchase, underwriting or similar agreement
approved by the Board upon payment of the consideration therefor (not less
than the par value of the Common Stock) provided for therein or (ii) upon
conversion or exercise of any other Offered Security, in accordance with
the terms of such Offered Security or the instrument governing such Offered
Security providing for such conversion or exercise as approved by the
Board, for the consideration approved by the Board (not less than the par
value of the Common Stock), then the shares of Common Stock will be validly
issued, fully paid and nonassessable.
(6) With respect to the Warrants, when (A) the Board has taken all
necessary corporate action to approve the creation of and the issuance and
terms of the Warrants, the terms of the offering thereof and related
matters, (B) the Warrant Agreement or Agreements relating to the Warrants
have been duly authorized and validly executed and delivered by the Company
and the warrant agent appointed by the Company and (C) the Warrants or
certificates representing the Warrants have been duly executed,
countersigned, registered and delivered in accordance with the appropriate
Warrant Agreement or Agreements and the applicable definitive purchase,
underwriting or similar agreement approved by the Board upon payment of the
consideration therefor provided for therein, the Warrants will be validly
issued.
We are aware that we are referred to under the heading "Legal
Opinions" in the prospectus forming a part of the Registration Statement, and we
hereby consent to such use of our name therein and to the use of this opinion
for filing with the Registration Statement as Exhibit 5 thereto. In giving this
consent, we do not hereby admit that we are within the category of persons whose
consent is required under Section 7 of the Securities Act or the Rules and
Regulations of the Commission promulgated thereunder.
Very truly yours,
/s/ Cravath, Swaine & Moore
ChiRex Inc.
300 Atlantic Street, Suite 402
Stamford, CT 06901
<PAGE>
Exhibit 12
<TABLE>
<CAPTION> THREE MONTHS
(all amounts in dollars, except ratios) ENDED
YEAR ENDED DECEMBER 31, MARCH 31, 1999
--------------------------------------------------------------- ------------
1994 1995 1996 1997 1998
<S> <C> <C> <C> <C> <C> <C>
Income (loss) from Continuing Operations
before provision for income taxes (3,311) (2,452) (6,442) (985) 4,541 4,423
Add:
Interest on indebtedness and
amortization of debt expenses 0 0 755 1,052 5,829 2,021
------ ------ ------ ------ ------ ------
Income (loss) as Adjusted (3,311) (2,452) (5,687) 67 10,370 6,444
------ ------ ------ ------ ------ ------
Fixed Charges:
Interest on indebtedness and
amortization of debt expense 0 0 755 1,052 5,829 2,021
Capitalized interest 0 0 0 150 1,987 162
------ ------ ------ ------ ------ ------
Total Fixed Charges 0 0 755 1,202 7,766 2,183
------ ------ ------ ------ ------ ------
Ratio of Earnings to
Fixed Charges N/A N/A N/A N/A 1.34x 2.95x
Coverage Deficiency N/A N/A 6,442 1,135 N/A N/A
====== ====== ====== ====== ====== ======
</TABLE>
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of ChiRex Inc. on Form S-3 to register
$104,625,000 worth of securities of our reports dated February 19, 1999
incorporated by reference in ChiRex Inc.'s Form 10-K for the year ended December
31, 1998 and to all references to our Firm included in this registration
statement.
/s/ Arthur Andersen LLP
Arthur Andersen LLP
May 27, 1999
Boston, Massachusetts
