UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 6)*
ALZA CORPORATION
------------------------------------------------------------
(Name of Issuer)
Common Stock, $.01 par value
------------------------------------------------------------
(Title of Class of Securities)
022615108
------------------------------------------------------------
(CUSIP Number)
John J. McGraw Philip A. Gelston
CIBA-GEIGY Corporation Cravath, Swaine & Moore
444 Saw Mill River Road 825 8th Avenue
Ardsley, New York 10502 New York, New York 10019
(914-479-2041) (212-474-1548)
------------------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
May 19, 1994
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement
on Schedule 13G to report the acquisition which is the subject of
this Schedule 13D, and is filing this Schedule because of
Rule 13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with the
statement [ ]. (A fee is not required only if the reporting
person: (1) has a previous statement on file reporting
beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment
subsequent thereto reporting beneficial ownership of five percent
or less of such class.) (See Rule 13d-7.)
Note: Six copies of this statement, including all
exhibits, should be filed with the Commission. See Rule 13d-1(a)
for other parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out
for a reporting person's initial filing on this form with respect
to the subject class of securities, and for any subsequent
amendment containing information which would alter disclosures
provided in a prior cover page.
Page 1 of 20
Exhibit Index is on page 14 of this filing
<PAGE>2
SCHEDULE 13D
CUSIP No. 022615108 Page 2 of 20 Pages
NAME OF REPORTING PERSON
S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1
Ciba-Geigy Corporation
I.R.S. No. 13-1834433
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [ ]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
WC
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
5 ITEMS 2(d) OR 2(e) [X]
CITIZENSHIP OR PLACE OF ORGANIZATION
6
New York
SOLE VOTING POWER
7
4,734,235
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY SOLE DISPOSITIVE POWER
OWNED BY EACH 9
REPORTING 1,979,415
PERSON WITH
SHARED DISPOSITIVE POWER
10
2,754,820
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
4,734,235
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
12 CERTAIN SHARES* [ ]
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
5.8%
TYPE OF REPORTING PERSON*
14
CO
*SEE INSTRUCTIONS BEFORE FILLING OUT!
Page 2 of 20
<PAGE>3
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Amendment No. 6)
Statement Of
CIBA-GEIGY CORPORATION
Pursuant to Section 13(d) of the
Securities Exchange Act of 1934
in respect of
ALZA CORPORATION
CIBA-GEIGY Corporation hereby supplements, amends and
restates its statement on Schedule 13D originally filed on
February 3, 1978 (the "Schedule 13D"), as amended and restated by
Amendments Nos. 1, 2, 3, 4 and 5 filed on June 22, 1982, December 9, 1988,
December 21, 1988, March 20, 1991, and March 27, 1991, respectively,
with respect to the Company's beneficial ownership of shares of the
Common Stock, par value $.01 per share, of ALZA Corporation, a
Delaware corporation.
Item 1. Security and Issuer.
The securities to which this statement relates are the
Common Stock, par value $.01 per share (referred to herein as "Common
Stock" or by its previous designation, "Class A Common Stock") of
ALZA Corporation, a Delaware corporation ("ALZA"), whose principal
executive offices are located at 950 Page Mill Road, Palo Alto,
California 94304.
Item 2. Identity and Background.
CIBA-GEIGY Corporation (the "Company"), a New York
corporation, has its principal executive offices at 444 Saw Mill River
Road, Ardsley, New York 10502. The Company resulted from the merger
in 1970 of CIBA Corporation of Summit, New Jersey, and Geigy Chemical
Corporation of Ardsley, New York. The Company and its subsidiaries
are leading developers and manufacturers of agricultural chemicals,
pharmaceuticals, dyes, polymers, vision care products and specialty
chemicals.
The names, addresses, occupations and citizenships of the
executive officers and members of the Board of Directors of the
Company are set forth on Schedule 1. To the best knowledge of the
Company, other than the matters described in Schedule 2, neither the
Company nor any of such officers and directors have, during the last
five years, been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors) or were parties to a civil
proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceedings were or are subject
to a judgment, decree or final order enjoining future violations of,
Page 3 of 20
<PAGE>4
or prohibiting activities subject to, federal or state securities laws
or finding liability with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
With respect to the 1978 Transaction (defined below), the
funds required for the purchase, conversion and exercise of ALZA's
securities acquired or which might have been acquired by the Company
were as follows:
Security Funds Required
8,700,000 shares of Old Preferred $30,000,000
Stock (defined below) of ALZA, con-
vertible into Class B Common Stock
(defined below) of ALZA
Class B Warrant (defined below) $ 1
_________________ ____________
8,700,000 shares of Class B Common $5,000,000 or, in cer-
Stock issuable upon conversion of the tain circumstances set
Old Preferred Stock forth on page 13 of
the 1977 Proxy
Statement (defined
below), $10,000,000
152,000 shares of Class B Common $1,292,000--$8.50/
Stock issuable upon exercise of the share (subject to
Class B Warrant adjustment)
____________________ ____________
8,852,000 shares of Class A Common No additional funds.
Stock issuable upon conversion of a
like number of shares of Class B
Common Stock
The purchase price for the Old Preferred Stock was paid in
installments and was obtained from the working capital of the Company.
With respect to the 1982 Transaction (defined below), under
the Reorganization Agreement (discussed below), the securities were
exchanged without additional consideration.
In 1983 ALZA redeemed all the New Preferred Stock (defined
below), and in 1986 the Company sold to ALZA 1,450,000 shares of Class
B Common Stock. Thus, as of the date of the filing of Amendment No.
3, the Company owned 1,450,000 shares of Class B Common Stock of ALZA,
each of which was convertible into two shares of Class A Common Stock
of ALZA. Pursuant to ALZA's prospectus dated November 21, 1988, the
Company had the right to purchase 362,500 units (the "Units")
consisting of one warrant to purchase one share of callable Class A
Common Stock of ALZA and one share of Class A Common Stock of Bio-
Electro Systems, Inc. ("BES"). The Units had been approved for
Page 4 of 20
<PAGE>5
listing on the American Stock Exchange upon official notice of
issuance. According to ALZA's prospectus, the BES stock would not be
eligible for separate listing on the American Stock Exchange or any
other national securities exchange or for quotation on the NASDAQ
National Marketing System.
After receiving ALZA's preliminary prospectus dated
October 21, 1988, the Company wrote a letter of intent to ALZA
advising that it intended to exercise its subscription rights,
assuming a price in the range of $10 to $12 per unit. The Company
reserved the right to alter its intention, but if it exercised its
right, agreed that (i) it would not convert its Class B Common Stock
into Class A Common Stock or otherwise dispose of ALZA stock or any
Units purchased in the subscription offering until ALZA advised that
such a sale would not interfere with the orderly completion of the
offering, and (ii) it would not acquire any additional Units pursuant
to the right to subscribe for "additional units" as described in the
preliminary prospectus. On December 14, 1988, the Company used
working capital to purchase 362,500 Units at $11 per unit.
On March 15, 1991, the Company exercised its right to
convert 1,450,000 shares of Class B Common Stock, of ALZA previously
held by the Company into 2,900,000 shares of Class A Common Stock.
In 1993, warrants to purchase 362,500 shares of Class A
Common Stock were exercised by the Company.
Item 4. Purpose of Transaction.
The Company holds its shares of Common Stock for investment
purposes.
As described further in Item 6, 1,000,000 shares of Common
Stock are subject to a call option. Depending upon market conditions
and other relevant factors, the Company may in the future sell all or
part of its shares of Common Stock or enter into options or other
arrangements covering all or part of its investment in ALZA.
The Company presently does not have any plans or proposals
relating to or which would result in an extraordinary corporate
transaction involving ALZA or otherwise require disclosure under
paragraphs (b) through (j) of Item 4 of Schedule 13D.
On March 27, 1991, the Company completed its disposition of
up to 2,377,410 shares of Class A Common Stock pursuant to its
agreements entered into on March 20, 1991 with Morgan Stanley & Co.
Incorporated ("Morgan Stanley") and Morgan Stanley International
(collectively with Morgan Stanley, the "Investment Bank"). 1,000,000
shares of Class A Common Stock were sold to Morgan Stanley at a
purchase price of $58.80 per share. The remainder became subject to
the exchange rights of $100,000,000 aggregate principal amount of 6
1/4% exchangeable subordinated debentures due 2016 (the "Debentures")
of the Company exchangeable into shares of Class A Common Stock (the
"ALZA Shares") at an initial exchange rate of $72.60 principal amount
of Debentures per share, or in certain circumstances for cash. The
Page 5 of 20
<PAGE>6
terms of the Debentures were set forth in Exhibit A to Amendment No.
5, under "Form of Reverse of Debenture" which Exhibit was previously
filed in paper format and is incorporated herein by reference. The
Company sold the Debentures to the Investment Bank at a purchase price
of 97.5% of the principal amount thereof.
The Debentures were issued under a Fiscal Agency Agreement
(the "Fiscal Agency Agreement") dated as of March 15, 1991, among the
Company, CIBA-GEIGY Limited and Chemical Bank, as Fiscal Agent (the
"Fiscal Agent"), and are subject to the terms of an Escrow Agreement
(the "Escrow Agreement") dated as of March 15, 1991, between the
Company and Chemical Bank, as Escrow Agent (the "Escrow Agent").
Concurrently with the issuance of the Debentures, the Company
deposited the ALZA Shares with the Escrow Agent to provide for the
exchange of the Debentures. The Company will be entitled to vote the
escrowed ALZA Shares or execute any written consent with respect
thereto so long as such escrowed ALZA Shares, on any record date for
the determination of stockholders entitled to vote at any meeting of
stockholders of ALZA or by consent, shall not have been registered in
the name of a holder exchanging all or a portion of its Debentures.
The Company will be entitled to all cash dividends paid on the ALZA
Shares held for exchange by the Escrow Agent, other than cash
dividends paid pursuant to a plan of liquidation, partial liquidation,
recapitalization or restructuring or other extraordinary cash
dividends. The Escrow Agreement also contains other provisions
relating to the ALZA Shares.
A copy of the Escrow Agreement was previously filed in paper
format as Exhibit B to Amendment No. 5, which Exhibit is incorporated
herein by reference.
The Company's purpose in effecting its sale of Class A
Common Stock to the Investment Bank, described above, was to realize a
substantial portion of its remaining investment in ALZA.
The relationship and certain transactions between the
Company and ALZA prior to 1982 were described in ALZA's Proxy
Statement for Annual Meeting, dated December 23, 1977 (the "1977 Proxy
Statement"), which was previously filed in paper format as Exhibit A
to the Schedule 13D and is incorporated herein by reference.
On June 10, 1982, the Company exchanged the 8,700,000 shares
of convertible voting preferred stock, no par value (the "Old
Preferred Stock") and a warrant (the "Class B Warrant") to purchase
152,000 shares of Class B Common Stock, no par value (the "Class B
Common Stock") it had acquired from ALZA on January 27, 1978 (the
purchase of such securities being herein referred to as the "1978
Transaction") for 100,000 shares of non-voting convertible preferred
stock (the "New Preferred Stock") and 2,900,000 shares of Class B
Common Stock, all pursuant to the Reorganization Agreement approved by
the shareholders of ALZA at the Annual Meeting held on June 8, 1982
(the exchange of such securities being herein referred to as the "1982
Transaction"). The Company acquired the New Preferred Stock and the
Class B Common Stock in the 1982 Transaction, for investment purposes,
and in connection with the Reorganization Agreement the Company
relinquished its voting control of ALZA. The Proxy Statement for that
Annual Meeting, dated May 4, 1982 (the "1982 Proxy Statement"), was
Page 6 of 20
<PAGE>7
previously filed in paper format as Exhibit A to Amendment No. 1 and
is incorporated herein by reference.
In 1982, the Company and ALZA restructured their
relationship, in conjunction with the Reorganization Agreement, and
entered into a revised Research Agreement. Those arrangements are
more fully described in the 1982 Proxy Statement, which is hereby
incorporated by reference. These arrangements resulted in a change in
ALZA's business as more fully described in the 1982 Proxy Statement.
Item 5. Interest in Securities of the Issuer.
The Company beneficially owns the following securities of
ALZA:
Security Percent of Class
4,734,235 shares of 5.8%
Common Stock.*
*Of the 4,734,235 shares of
Common Stock, the
Company has sole voting and
investment power over
1,979,415 shares and the
remainder have been
deposited with the Escrow
Agent and are subject to
the terms of the Escrow
Agreement.
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the
Issuer.
See pages 10 to 12 of the 1977 Proxy Statement under
"Purchase and Sale of Shares of Preferred Stock" and "Warrants", which
are hereby incorporated by reference.
On May 19, 1994, the Company and Swiss Bank Corporation,
London Branch ("SBC") entered into an option agreement (the "Option
Agreement"). Pursuant to the terms of the Option Agreement, SBC has
the right to purchase from the Company on December 15, 1994, 1,000,000
shares of Common Stock of ALZA at a per share price of $32, for an
aggregate purchase price of $32,000,000. The total premium to be paid
by SBC to the Company for the option is $750,000.
Although the terms of the Option Agreement have not yet been
finalized, attached hereto as Exhibit A is a proposed form of Option
Agreement dated May 20, 1994, which is hereby incorporated by
reference.
Page 7 of 20
<PAGE>8
Item 7. Materials to be Filed as Exhibits.
Confirmation dated May 20, 1994.
Purchase Agreements dated March 20, 1991. **
Fiscal Agency Agreement dated as of March 15, 1991. **
Escrow Agreement dated as of March 15, 1991. **
ALZA's Prospectus dated November 21, 1988. **
CIBA-GEIGY's Letter of intent to exercise subscription
rights dated November 11, 1988. **
ALZA's Proxy Statement dated May 4, 1982. **
ALZA's Proxy Statement dated December 23, 1977. **
** These Exhibits were previously filed with the Securities and
Exchange Commission in paper format and are incorporated herein by
reference.
Page 8 of 20
<PAGE>9
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is
true, complete and correct.
Dated: May 24, 1994
CIBA-GEIGY CORPORATION
By: /s/ Stanley Sherman
----------------------------
Name: Stanley Sherman
Title: Vice President,
Finance & Information Services
Page 9 of 20
<PAGE>10
SCHEDULE 1
Members of the Board of Directors and Officers of
Ciba-Geigy Corporation
Present Principal
Name and Business Address Citizenship Occupation or Employment
R. Barth U.S.A. Director; Chairman of the
c/o Ciba-Geigy Corporation Board; President & Chief
444 Saw Mill River Road Executive Officer
Ardsley, NY 10502
J. Boehle, Jr. U.S.A. Vice President, Internal
c/o Ciba-Geigy Corporation Audit & Administration
7 Skyline Drive
Hawthorne, NY 10532
E.J. Bontempo U.S.A. Director; Vice President;
c/o Ciba-Geigy Corporation President, Agricultural
410 Swing Road Group
Greensboro, NC 27419
C. G. Bradley U.S.A. Vice President; Chairman of
c/o CIBA Vision Corporation the Board, CIBA Vision
11460 Johns Creek Parkway Corporation
Duluth, GA 30136-1518
S.H. Goldberg U.S.A. Vice President, Human
c/o Ciba-Geigy Corporation Resources
444 Saw Mill River Road
Ardsley, NY 10502
J. Habermeier Switzerland Vice President; President,
c/o Ciba-Geigy Corporation Composites Division
5115 East La Palma Avenue
Anaheim, CA 92007
H.E. Kinne U.S.A. Director; Vice President;
c/o Ciba-Geigy Corporation President, Additives
7 Skyline Drive Division
Hawthorne, NY 10532
A. Krauer Switzerland Director; Chief Executive
c/o Ciba-Geigy Limited Officer, Ciba-Geigy Limited
CH-4002 Basle
Switzerland
H.V. Lemaster U.S.A. Director; Vice President;
c/o Ciba-Geigy Corporation President, Textile Products
410 Swing Road Division
Greensboro, NC 27419
H. Lippuner Switzerland Director; Chief Operating
c/o Ciba-Geigy Limited Officer, Ciba-Geigy Limited
CH-4002 Basle
Switzerland
Page 10 of 20
<PAGE>11
Present Principal
Name and Business Address Citizenship Occupation or Employment
A.M. MacKinnon U.S.A. Director; Retired
c/o Ciba-Geigy Corporation
444 Saw Mill River Road
Ardsley, NY 10502
J.J. McGraw U.S.A. Director; Vice President,
c/o Ciba-Geigy Corporation General Counsel & Secretary
444 Saw Mill River Road
Ardsley, NY 10502
R.A. Meyer Switzerland Director; Chief Financial
c/o Ciba-Geigy Limited Officer, Ciba-Geigy Limited
CH-4002 Basle
Switzerland
J. Munigle U.S.A. Vice President, Toxicology,
c/o Ciba-Geigy Corporation Regulatory Auditing &
444 Saw Mill River Road Compliance
Ardsley, NY 10502
C.O. O'Brien U.S.A. Director; Retired
c/o Ciba-Geigy Corporation
444 Saw Mill River Road
Ardsley, NY 10502
M. Riediker Switzerland Vice President; President,
c/o Ciba-Geigy Corporation Polymers Division
7 Skyline Drive
Hawthorne, NY 10532
J. Schaefle France Vice President; President,
c/o Ciba-Geigy Corporation Pigments Division
James & Water Streets
Newport, DE 19804
J. Schneller U.S.A. Director; Retired
c/o Ciba-Geigy Corporation Switzerland
444 Saw Mill River Road
Ardsley, NY 10502
S. Sherman U.S.A. Director; Vice President,
c/o Ciba-Geigy Corporation Finance & Information
444 Saw Mill River Road Services
Ardsley, NY 10502
J.T. Sullivan U.S.A. Director; Senior Vice
c/o Ciba-Geigy Corporation President
444 Saw Mill River Road
Ardsley, NY 10502
D. Taylor U.S.A. Vice President, Public
c/o Ciba-Geigy Corporation Affairs & Communications
444 Saw Mill River Road
Ardsley, NY 10502
Page 11 of 20
<PAGE>12
Present Principal
Name and Business Address Citizenship Occupation or Employment
D.G. Watson United Director; Vice President;
c/o Ciba-Geigy Corporation Kingdom President, Pharmaceuticals
566 Morris Avenue Division
Summit, NJ 07901
M. White U.S.A. Vice President; President,
c/o Ciba-Geigy Corporation Chemicals Division
410 Swing Road
Greensboro, NC 27419
Page 12 of 20
<PAGE>13
SCHEDULE 2
On February 28, 1992, the Company and two
employees from its Toms River plant pleaded guilty in
Superior Court, Law Division, Mercer County, New Jersey to
one count of unintentional illegal disposal of pollutants in
a double-lined landfill. Judgment of conviction was entered
on March 23, 1992. As part of the settlement agreement, the
Company paid a criminal fine of $3.5 million, civil
penalties of $5.5 million and administrative costs of $2.35
million. At the same time, it made a contribution to the
State of New Jersey of $2.5 million for environmental
purposes.
On August 14, 1992, the Company pleaded no contest
in Louisiana State Court, 18th Judicial District, to fifteen
misdemeanor counts arising from falsification of certain
back-up quality control data relating to water discharge
permits at its St. Gabriel plant and paid a $250,000 fine.
At the same time, it made two contributions of $50,000 each
to the Sheriff's offices of Iberville Parish and West Baton
Rouge Parish.
In 1992, the Company pleaded guilty to an
Environmental Control Complaint and Summons resulting from
an odor emission at its Newport, Delaware plant site. The
matter was under the jurisdiction of the Delaware Justice of
the Peace Court, Newport, Delaware. A fine of $598.50 was
paid.
Page 13 of 20
<PAGE>14
EXHIBIT INDEX
Exhibit Page
A. Form of Option Agreement dated May 20, 1994 15
B. Purchase Agreements dated March 20, 1991 (filed as
Exhibits I and II to Amendment No. 4 at pages 7 and
11, respectively) **
C. Fiscal Agency Agreement dated as of March 15, 1991
(filed as Exhibit A to Amendment No. 5 at page 7) **
D. Escrow Agreement dated as of March 15, 1991 (filed
as Exhibit B to Amendment No. 5 at page 100) **
E. ALZA's Prospectus dated November 21, 1988 (filed as
Exhibit A to Amendment No. 2) **
F. CIBA-GEIGY's letter of intent to exercise
subscription rights dated November 11, 1988 (filed
as Exhibit B to Amendment No. 2) **
G. ALZA's Proxy Statement dated May 4, 1982 (filed as
Exhibit A to Amendment No. 1 at page 5) **
H. ALZA's Proxy Statement dated December 23, 1977
(filed as Exhibit A to original Schedule 13D at
page 21) **
** These Exhibits were previously filed with the Securities
and Exchange Commission in paper format and are
incorporated herein by reference.
Page 14 of 20
<PAGE>15
EXHIBIT A
DATE: 20 MAY 1994
TO: CIBA-GEIGY Corporation, New York
ATTENTION: Mr. Walter D. Hosp, Director, Corporate
Finance
FAX NO.: (914) 479-4637
FROM: Swiss Bank Corporation, London Branch
SUBJECT: Equity Option
Swiss Bank Corporation Ref: E3714
------------------------------------------------------------
Dear Sirs:
The purpose of this communication is to confirm
the terms and conditions of the transaction entered into
between us on the Trade Date specified below (the
"Transaction"). This confirmation constitutes a
"Confirmation" as referred to in the ISDA Master Agreement
specified below. For the purposes of this Confirmation
only, Swiss Bank Corporation, London Branch shall be known
as "Party A" and CIBA-GEIGY Corporation, New York, shall be
known as "Party B".
The definitions and provisions contained in the
1991 ISDA definitions (as published by the International
SWAPS and Derivatives Association, Inc. (formerly known as
the International SWAP Dealers Association, Inc.)("ISDA"))
are incorporated into this Confirmation. In the event of
any inconsistency between those definitions and provisions
and this Confirmation, this Confirmation will govern.
This Confirmation evidences a complete and binding
agreement between you and us as to the terms of the
Transaction to which this Confirmation relates. In addition
upon the execution by you and Swiss Bank Corporation,
London, of a Master Agreement (the "Agreement") in the form
published by the ISDA with such modifications as you and we
shall in good faith agree, this Confirmation will
supplement, form part of, and be subject to, the Agreement.
Page 15 of 20
<PAGE>16
The terms of the particular Transaction to which
this Confirmation relates are as follows:
TRADE DATE: 19 MAY 1994
Option Details
Buyer: Party A
Seller: Party B
Option Type: Call
Option Style: European
Total Premium: USD 750,000
Premium Payment Date: Five business days after
the Trade Date
Strike Price (Per Share) USD 32.000
Expiry Date: 15 December 1994
Expiry Time: Chicago Close (3 p.m.
Central Standard Time)
Exercise Period: Expiry Date
Cut-Off Time: Chicago Close (3 p.m.
Central Standard Time)
Settlement Terms:
Settlement Date: Five business days after
the Expiry Date
Physical Settlement: Applicable: On the
Settlement Date, the Buyer
will pay to the Seller the
Settlement Price and the
Seller will deliver to the
Buyer the number of shares
to be delivered. Such
payment and delivery shall
be made through the
clearance system specified
below on a delivery versus
payment basis.
Settlement Price: The Strike Price (per
share) multiplied by the
number of shares to be
delivered.
Page 16 of 20
<PAGE>17
Number of shares to be Contract multiplier
delivered: multiplied by the number of
Option Contracts.
Partial Exercise: Not applicable
Underlying Property:
Trade Price (per share): USD 0.75000
Number of Option Contracts: 1,000,000
Contract Multiplier: 1
Underlying Property: Alza Corp. (NYSE: AZA)
Common Stock
Unit: One common share
Issuer: Alza Corp.
Notional Amount: USD 32,000,000
Relevant Market: The New York Stock Exchange
Clearance System: DTC
Calculation Agent: Party A, whose calculations
shall be binding absent
manifest error
Automatic Exercise: An option shall be
automatically exercised on
the Expiry Date if the
option is in the money. An
option will be in the money
if the Reference Price
exceeds the Strike Price.
Account Details:
Payments to Swiss Bank
Corporation, London: A/C No. 101 WA 140007 000
USD Bank Account: With Swiss Bank Corporation
in New York
Payments to CIBA-GEIGY
Corporation, New York: Chase Manhattan Bank
ADA 021-000-021
A/C No. 910-4-017269
Broker: N/A
Page 17 of 20
<PAGE>18
1. Adjustment Provisions. During the life of the
Transaction, if any adjustment is made by the Options
Clearing Corporation or its successors (the "OCC") in the
terms of outstanding OCC-Issued Options ("OCC Options") on
the underlying property which is the subject of the
Transaction, an equivalent adjustment shall be made in the
terms of the Transaction, except as provided in the
following paragraph. No adjustment shall be made in the
terms of the Transaction for any event that does not result
in an adjustment to the terms of outstanding OCC Options on
the underlying property. Without limiting the generality of
the foregoing, no adjustment shall be made in the terms of
the Transaction for ordinary case dividends on the
underlying property.
If at any time during the life of the Transaction
there shall be no outstanding OCC Options on the underlying
property, and an event shall occur for which an adjustment
might otherwise be made under the By-Laws, rules, and stated
policies of the OCC applicable to the adjustment of OCC
Options (the "OCC Adjustment Rules"), the parties shall use
their best efforts, applying the principles set forth in the
OCC Adjustment Rules, to jointly determine whether to adjust
the terms of the Transaction and the nature of any such
adjustment.
2. Representations and Warranties of Party A and
Party B: Party A and Party B each hereby represents,
warrants and agrees as follows: (i) it is duly organized
and validly existing under the laws of the jurisdiction of
its organization or incorporation and, if relevant under
such laws, in good standing; (ii) it has the power to
execute and deliver this Confirmation and to perform its
obligations under this Confirmation and the Transaction
evidenced hereby; (iii) such execution, delivery and
performance do not violate or conflict with any law
applicable to it, any provision of its constitutional
documents, any order or judgment of any court or other
agency of government applicable to it or any of its assets
or any contractual restriction binding on or affecting it or
any of its assets; (iv) all governmental and other consents
that are required to have been obtained by it with respect
to this Confirmation and the Transaction evidenced hereby
have been obtained and are in full force and effect and all
conditions of any such consents have been complied with;
(v) its obligations under this Confirmation and the
Transaction evidenced hereby constitute its legal, valid and
binding obligations, enforceable in accordance with their
respective terms (subject to applicable bankruptcy,
reorganization, insolvency, moratorium or similar laws
affecting creditors' rights generally and subject, as to
enforceability, to equitable principles of general
application (regardless of whether enforcement is sought in
a proceeding in equity or at law)); (vi) it is not required
by any applicable law, as modified by the practice of any
relevant governmental, revenue authority, of any relevant
jurisdiction to make any deduction or withholding for or on
Page 18 of 20
<PAGE>19
account of any tax from any payment to be made by it to the
other party under this Confirmation and the Transaction
evidenced hereby; (vii) (with respect to Party A only) each
payment received or to be received by it in connection with
the Agreement will be effectively connected with its conduct
of a trade or business in the United States; (viii) it is
entering into this Confirmation and the Transaction
evidenced hereby as principal (and not as Agent or in any
other capacity, fiduciary or otherwise); (ix)(a) it is an
"Accredited Investor" as such term is defined in
Regulation D promulgated under the Securities Act of 1933,
(b) it has had access to such information regarding the
Transaction and the other party as it requested, (c) it has
knowledge and experience in financial and business matters
and is capable of evaluating the merits and risks of the
Transaction and is able to bear the economic risk of its
investment, including without limitation the risk of
complete loss on the investment and (d) it acquired its
interest herein and in the Transaction evidenced hereby for
its own account for investment and not with a view to, or in
connection with, any distribution of such interests; and
(x) it is not relying on the other party for any advice
concerning the Transaction. It is not receiving any
compensation from the other party for providing advice in
respect of this Transaction, and any advice received by it
will not form the primary basis for its decision to enter
into this Transaction.
Party B represents and warrants that it will
convey good title to the shares of underlying property it is
required to deliver, free and clear of any lien, charge,
claim or encumbrance (other than a lien routinely imposed on
all securities in the Clearance System).
Governing Law and Consent to Jurisdiction:
This transaction will be governed by and construed
in accordance with the laws of New York. Each party
irrevocably submits to the jurisdiction of the courts of the
State of New York and the United States District Court
located in the Borough of Manhattan in New York City, and
waives any objection which it may have at any time to the
laying of venue of any proceedings concerning this
Transaction brought in such court, waives any claim that
such proceedings have been brought in an inconvenient forum
and further waives the right to object that such court does
not have jurisdiction over any party. Each party hereby
irrevocably waives any and all right to trial by jury in any
suit, action or proceeding arising out of or relating to
this Transaction and acknowledges that this waiver is a
material inducement to the other party's entering into this
Transaction.
Page 19 of 20
<PAGE>20
Assignment and Transfer:
Neither party may assign or transfer its rights or
obligations hereunder without the prior written consent of
the other party.
Please confirm that the foregoing correctly sets
forth the terms of our agreement, and forward your account
details by return Swiss Bank Corporation, Chicago Branch,
Attn: James Kleinops, substantially to the following
effect:
"Subject: Equity Option - SBC Ref: ES714
We acknowledge receipt of your communication dated
May 20, 1994, with respect to a transaction between Swiss
Bank Corporation, London Branch, and CIBA-GEIGY Corporation,
New York, with a Trade Date of 19 May 1994, and an Expiry
Date of 15 December 1994 and confirm that such communication
correctly sets forth the terms of our agreement relating to
the transaction described therein. We confirm that no
further documentation will be required.
Our payment instructions are as follows:
By (specify Name(s) and Title(s) of Authorized
Officer(s))"
Yours faithfully,
/s/ Peter Favell /s/ Christopher Bentley
------------------- -----------------------
Peter Favell Christopher Bentley
Assistant Manager Manager
Capital Markets and Capital Markets and
Treasury Finance and Treasury Finance and
Operations Operations
Please use our reference in all correspondence
Document No.: ES714
Page 20 of 20
