<PAGE>
As filed with the Securities and Exchange Commission on May 24, 2000
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
COR THERAPEUTICS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 94-3060271
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
256 East Grand Avenue
South San Francisco, California 94080
(650) 244-6800
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
-------------------------
Patrick A. Broderick
Senior Vice President and General Counsel
256 East Grand Avenue
South San Francisco, California 94080
(650) 244-6800
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
-------------------------
Copies to:
Robert L. Jones, Esq.
Andrea Vachss, Esq.
Cooley Godward LLP
Five Palo Alto Square
3000 El Camino Real
Palo Alto, CA 94306-2155
(650) 843-5300
-------------------------
Approximate date of proposed sale to the public:
As soon as practicable after this registration statement become effective.
-------------------------
If the only securities being registered on this form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [_]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the Prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE
-------------------------------
<TABLE>
<CAPTION>
TITLE OF SECURITIES TO AMOUNT TO BE PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
BE REGISTERED REGISTERED OFFERING PRICE PER AGGREGATE OFFERING REGISTRATION FEE (1)
SHARE (1) PRICE (1)
<S> <C> <C> <C> <C>
5% Convertible Subordinated $300,000,000 100% (1) $300,000,000 (1) $79,200
</TABLE>
Notes due March 1, 2007
<TABLE>
<S> <C> <C> <C> <C>
Common Stock, $.0001 par 4,440,840 Shares (3) -- (4) --(4) --(4)
value (2)
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee in
accordance with Rule 457(i) of the Securities Act of 1933.
(2) Each share of the registrant's common stock being registered hereunder, if
issued prior to the termination by the registrant of its preferred share
rights agreement, includes Series A junior participating preferred stock
purchase rights. Prior to the occurrence of certain events, the Series A
junior participating preferred stock purchase rights will not be exerciseable
or evidenced separately from the registrant's common stock and have no value
except as reflected in the market price of the shares to which they are
attached.
(3) This number represents the number of shares of common stock that are
initially issuable upon conversion of the 5% Convertible Subordinated Notes
due March 1, 2007 registered hereby. For purposes of estimating the number of
shares of common stock to be included upon conversion of the notes, we
calculated the number of shares issuable upon conversion of the notes based on
a conversion rate of 14.8028 shares per $1,000 principal amount of the notes.
In addition, the amount of shares set forth in this table to be registered
includes an indeterminate number of shares of common stock issuable upon
conversion of the notes, as this amount may be adjusted as a result of stock
splits, stock dividends and antidilution provisions.
(4) No additional consideration will be received for the common stock, and
therefore, no registration fee is required pursuant to Rule 457(i).
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 that specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. The +
+Selling Stockholders may not sell these securities until the Registration +
+Statement filed with the Securities and Exchange Commission is effective. +
+This prospectus is not an offer to sell these securities and is not soliciting+
+an offer to buy these securities in any state where the offer or sale is not +
+permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Subject to Completion, dated May 24, 2000
PROSPECTUS
$300,000,000
COR THERAPEUTICS, INC.
5.00% Convertible Subordinated Notes due March 1, 2007
and Shares of Common Stock Issuable upon Conversion of the Notes
________________
This prospectus covers resales by selling security holders of our 5%
Convertible Subordinated Notes due March 1, 2007 and shares of our common stock
into which the notes are convertible.
The holders of the notes may convert the notes into shares of our common
stock at any time at a conversion rate of 14.8028 shares per $1,000 principal
amount of notes or $67.56 per share. After March 1, 2003, we may redeem the
notes, in whole or in part, at the redemption prices set forth in the section of
this prospectus entitled "Description of the Notes--Optional Redemption."
In the event of a Change of Control, as defined in the section entitled
"Description of the Notes--Repurchase at Option of Holders Upon a Change in
Control," each holder of the notes may require us to repurchase the notes at
100% of the principal amount of the notes plus accrued interest. At our option,
we may repurchase the notes for cash or, under certain circumstances, common
stock.
The notes are general, unsecured obligations that are subordinated in
right of payment to all of our existing and future senior indebtedness. See
"Description of the Notes--Subordination."
Prior to this offering, the notes have been eligible for trading on the
PORTAL Market of the Nasdaq Stock Market. Notes sold by means of this prospectus
are not expected to remain eligible for trading on the PORTAL Market. We do not
intend to list the notes for trading on any national securities exchange or on
the Nasdaq National Market and can give no assurance about the development of
any trading market for the notes.
Our common stock currently trades on the Nasdaq National Market under the
symbol "CORR." The last reported sale price on May 23, 2000 was $61.625 per
share.
See "Risk Factors" beginning on page 5 of this prospectus to read about
factors you should consider before purchasing the notes or our common stock.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is a
criminal offense .
, 2000
<PAGE>
WE HAVE AUTHORIZED NO ONE TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS
THAT ARE NOT CONTAINED IN THIS PROSPECTUS. YOU SHOULD RELY ONLY ON THE
INFORMATION PROVIDED IN THIS PROSPECTUS OR INCORPORATED BY REFERENCE THEREIN.
YOU MUST NOT RELY ON ANY UNAUTHORIZED INFORMATION.
THIS PROSPECTUS DOES NOT OFFER TO SELL OR BUY ANY NOTES OR SHARES OF COMMON
STOCK IN ANY JURISDICTION WHERE IT IS UNLAWFUL. YOU SHOULD NOT ASSUME THAT THE
INFORMATION IN THIS PROSPECTUS IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON
THE FRONT OF THE DOCUMENT.
________________
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Summary.......................................................................... 3
Risk Factors..................................................................... 5
Cautionary Note Regarding Forward-Looking Statements............................. 10
Where You Can Find More Information about COR and this Offering.................. 10
Use of Proceeds.................................................................. 12
Ratio of Earnings to Fixed Charges............................................... 12
Description of the Notes......................................................... 13
Description of Capital Stock..................................................... 25
Certain United States Federal Income Tax Consequences............................ 27
Selling Security Holders......................................................... 32
Plan of Distribution............................................................. 34
Legal Matters.................................................................... 36
Experts.......................................................................... 36
</TABLE>
2
<PAGE>
SUMMARY
The following summary is qualified in its entirety by the more detailed
information appearing elsewhere in this prospectus. Prospective investors should
consider carefully the information set forth in this prospectus under the
heading "Risk Factors". References to "COR" or to the "Company" or to "we" or
"us" refer to COR Therapeutics, Inc.
The Company
COR is dedicated to the discovery, development and commercialization of
novel pharmaceutical products to establish new standards of care for the
treatment and prevention of severe cardiovascular diseases. The Company has
funded its operations primarily through public and private debt and equity
financings and proceeds from research and development and commercialization
collaboration agreements.
INTEGRILIN(R) (eptifibatide) Injection is the first product that the
Company has taken from discovery to commercialization. Approved by the Food and
Drug Administration, or the "FDA" in May 1998, INTEGRILIN is indicated for the
treatment of patients with an acute coronary syndrome and patients who undergo
angioplasty procedures. The acute coronary syndrome indication includes patients
with unstable angina and non-Q-wave myocardial infarction, whether they receive
medical treatment or undergo angioplasty. Launched in June 1998 in the United
States in conjunction with Schering-Plough Ltd. And Schering Corporation,
collectively referred to as "Schering," INTEGRILIN is the only drug in its class
that is approved by the FDA for use in both acute coronary syndromes and in
angioplasty. COR and Schering co-promote the drug in the United States and share
any profits or losses.
Schering markets INTEGRILIN in Europe as the Company's exclusive licensee
on a royalty-bearing basis. INTEGRILIN has also regulatory approval in a number
of countries outside the European Union and the United States and is marketed in
those countries by Schering as the Company's exclusive licensee on a royalty-
bearing basis.
COR and Schering are conducting or have conducted Phase II clinical trials
of INTEGRILIN with different fibrinolytics in the setting of acute myocardial
infarction. COR and Schering also sponsor additional clinical trials of
INTEGRILIN in a variety of clinical settings.
In addition to the Company's commercial activities, COR continues to pursue
a wide array of research and development programs. We have developed an oral GP
IIb-IIIa inhibitor, called cromafiban, to prevent platelet aggregation. Results
to date of Phase I and initial Phase II studies for cromafiban show that it has
a high affinity and specificity for GP IIb-IIIa. Inhibition of platelet
aggregation by cromafiban has been shown to be dose- and concentration-
dependent. Plasma concentrations have indicated a sufficiently long elimination
half-life to allow for once-daily dosing with a low peak-to-trough ratio. No
food interactions have been observed. Minor bleeding has been the most prevalent
complication encountered during cromafiban therapy in clinical trials. COR is
also conducting preclinical research and development in several other
cardiovascular programs.
We were incorporated under the laws of Delaware in 1988. As of December 31,
1999, we had 320 full-time employees, of whom 152 were in research and
development, 120 were in sales and marketing and 48 were in general and
administrative functions. Our headquarters are located at 256 East Grand Avenue,
South San Francisco, California 94080, and our telephone number is (650) 244-
6800.
The Notes
Interest.......... We pay interest on the notes semi-annually on March 1 and
September 1 of each year, commencing September 1, 2000.
Conversion........ The notes are convertible at the option of the holder into
shares of common stock at a conversion rate of 14.8028 shares
of common stock per $1,000 principal amount of notes, which
is equivalent to a conversion price of $67.56 per share. The
conversion rate is subject to adjustment in certain events.
The notes are convertible at any time before the close of
business on the maturity date, unless we have previously
redeemed or repurchased the notes. Holders of notes called
for redemption or repurchase will be entitled to convert the
notes up to and including, but not after, the business day
immediately preceding the date fixed for redemption or
repurchase, as the case may be. See section entitled
"Description of the Notes -- Conversion Rights".
Subordination..... The notes are subordinated to our present and future senior
debt, as that term is defined in this prospectus. As of March
31, 2000, the aggregate amount of our outstanding senior debt
was approximately $4.1 million. The indenture under which the
notes have been issued will not restrict the incurrence of
senior debt by COR. See "Description of the Notes --
Subordination".
3
<PAGE>
Global Note; Book Entry System.... The notes are issued only in fully registered
form without interest coupons and in minimum
denominations of $1,000. The notes are
evidenced by one or more global notes
deposited with the trustee for the notes, as
custodian for The Depository Trust Company
("DTC"). Beneficial interests in the global
notes are shown on, and transfers of those
beneficial interests can only be made
through, records maintained by DTC and its
participants. See "Description of the
Notes --Form, Denomination, Transfer,
Exchange and Book-Entry Procedures".
Optional Redemption by Us......... We may redeem the notes, at our option, in
whole or in part, on or after March 1, 2003,
at the redemption prices set forth in this
prospectus plus accrued interest to the
redemption date. See "Description of the
Notes -- Optional Redemption by COR".
Repurchase at Option of
Holders Upon a Change
in Control........................ Upon a change in control, as that term is
defined in this prospectus, you will have the
right, subject to certain conditions and
restrictions, to require us to repurchase
your notes, in whole or in part, at 100% of
their principal amount, plus accrued interest
to the repurchase date. The repurchase price
is payable in cash or, at our option, in
shares of common stock. However, we may only
pay the repurchase price in common stock if
we satisfy prescribed conditions. If we pay
the repurchase price in common stock, the
common stock will be valued at 95% of the
average closing sales prices of the common
stock for the five trading days preceding and
including the third trading day prior to the
repurchase date. A change in control could be
an event of default under future senior debt.
In those circumstances, the subordination
provisions of the indenture would likely
prevent us from repurchasing the notes until
the senior debt is paid in full. See
"Description of the Notes -- Repurchase at
Option of Holders Upon a Change in Control".
Events of Default................. The following are events of default under the
indenture for the notes:
. we fail to pay the principal of or any premium on any note when due,
whether or not the payment is prohibited by the subordination
provisions of the indenture;
. we fail to pay any interest on any note when due and that non-payment
continues for 30 days, whether or not the payment is prohibited by the
subordination provisions of the indenture;
. we fail to provide the notice that we are required to give in the
event of a change in control, whether or not the notice is prohibited
by the subordination provisions of the indenture;
. we fail to perform any other covenant in the indenture and that
failure continues for 60 days after written notice to us by the
trustee or the holders of at least 25% in aggregate principal amount
of outstanding notes;
. failure to pay when due the principal of, or acceleration of, any
indebtedness for money borrowed by us or any of our subsidiaries in
excess of $10 million (excluding equipment and facilities leases) if
the indebtedness is not discharged, or the acceleration is not
annulled, within 30 days after written notice to us by the trustee or
the holders of at least 25% in aggregate principal amount of the
outstanding notes; and
. events of bankruptcy, insolvency or reorganization specified in the
indenture.
See section entitled "Description of the Notes -- Events of Default".
Governing Law..................... The indenture and the notes are governed by
the laws of the State of New York.
_____________
4
<PAGE>
RISK FACTORS
Our business faces significant risks. The risks described below may not be
the only risks we face. Additional risks that we do not yet know of or that we
currently think are immaterial may also impair our business operations. If any
of the events or circumstances described in the following risks actually occurs,
our business, financial condition, or results of operations could be materially
adversely affected and the trading price of our common stock could decline.
Future revenues from INTEGRILIN(R) (eptifibatide) Injection may be less than
expected.
Our prospects are highly dependent upon increasing the sales of our only
commercial product, INTEGRILIN. Our revenues to date have consisted largely of
contract revenue from development and milestone payments and co-promotion
revenue from product sales by Schering of INTEGRILIN. If INTEGRILIN sales
fail to increase, it would harm our business, financial condition and results of
operations.
A number of factors may affect the rate and breadth of market acceptance of
INTEGRILIN, including:
. the perception by physicians and other members of the health care
community of the safety and efficacy of INTEGRILIN;
. acceptance of INTEGRILIN outside the United States;
. our dependence upon Schering's commitment to market and sell
INTEGRILIN;
. the price of INTEGRILIN relative to other drugs or competing treatment
modalities;
. the availability of third-party reimbursement;
. the effectiveness of our sales and marketing efforts with Schering;
. the need to increase usage of INTEGRILIN throughout the treatment
process; and
. side effects or unfavorable publicity concerning INTEGRILIN or other
drugs in its class.
We have a history of operating losses and are uncertain of future profitability.
Historically, our expenses have exceeded revenues. We incur significant
expenses in developing, training, maintaining and managing our sales
organization. The cost of establishing and maintaining the sales force may
exceed INTEGRILIN product revenues, and our direct marketing and sales efforts
may not be successful. We had an accumulated deficit as of March 31, 2000 of
approximately $225 million. These losses may increase as we expand our
commercialization and research and development activities, and such losses may
fluctuate significantly from quarter to quarter. We may not sustain or increase
our contract revenues derived from product sales or achieve profitable
operations.
We may not be able to compete effectively in the cardiovascular disease market.
Due to the incidence and severity of cardiovascular diseases, the market
for therapeutic products that address such diseases is large, and competition is
intense and expected to increase. Our most significant competitors are major
pharmaceutical companies and more established biotechnology companies, which
have significant resources and expertise in research and development,
manufacturing, testing, obtaining regulatory approvals and marketing. The two
products that compete with INTEGRILIN are abciximab, which is produced by
Johnson & Johnson and sold by Johnson & Johnson and Eli Lilly & Co., and
tirofiban, which is produced and sold by Merck & Co., Inc. Emerging
pharmaceutical and biotechnology companies may also prove to be significant
competitors, particularly through collaboration arrangements with large
pharmaceutical companies. Many of these competitors have cardiovascular products
approved or in development, and operate large, well-funded cardiovascular
research and development programs. We must also compete with academic
institutions, governmental agencies, and other public and private research
organizations that conduct research in the cardiovascular field, seek patent
protection for their discoveries and establish collaboration arrangements for
product and clinical development and marketing.
5
<PAGE>
If our collaboration relationships are not successful we may not be able to
effectively develop and market our products.
We are currently engaged in a number of strategic collaborations with other
companies, consultants, universities and medical centers. Our main collaboration
agreement is with Schering for the development, marketing and sale of
INTEGRILIN(R) (eptifibatide) Injection.
Our collaborative relationships may not be successful or lead to the
development or commercialization of any particular product or product
opportunity in the ongoing development and marketing of INTEGRILIN. Although
under our current agreements we work exclusively with our collaborators within a
defined field for a defined period, a collaborator or collaborators may
terminate its or their agreement with us or separately pursue alternative
products, therapeutic approaches or technologies as a means of developing
treatments for the diseases targeted by us or a collaboration. For these and
other reasons, such as a change in collaborator's strategic direction, even if a
collaborator continues its contributions to the arrangement, it may nevertheless
determine not to actively pursue the development or commercialization of any
resulting products. In that event, our ability to pursue potential products
could be severely limited.
We evaluate, on an ongoing basis, potential collaborations where
relationships may complement and expand our research, development, sales or
marketing capabilities. We anticipate that in the future we may have to enter
into a new collaborative relationship to jointly develop and market cromafiban
and other potential products. Any arrangements may limit our flexibility in
pursuing alternatives for the commercialization of our products. We may not be
able to establish any additional collaboration arrangements. If established,
such arrangements may not be successful.
Our business may be harmed if our third-party manufacturers are not able to
provide us with adequate supplies of our products.
We currently have no manufacturing facilities and, accordingly, rely on
third parties for clinical and commercial production of INTEGRILIN and for
clinical production of product candidates. If the third-party manufacturers or
suppliers were to cease production or otherwise fail to supply us or we were
unable to contract on acceptable terms for manufacturing services with others,
our ability to produce INTEGRILIN and to conduct preclinical testing and
clinical trials of product candidates, would be adversely affected. This could
potentially result in product supply and distribution shortages of INTEGRILIN
and delay of regulatory approval and new development of product candidates.
These results could materially impair our competitive position and harm our
business, financial condition and results of operations.
Our revenue may be affected negatively by reimbursement levels and pricing
limitations.
In both domestic and foreign markets, sales of our products may be affected
by the availability of reimbursement from third-party payors, including
government health administration authorities, managed care providers, private
health insurers and other organizations. In addition, third-party payors may
challenge the price and cost effectiveness of our products. In many major
markets outside the United States, pricing approval is required before sales can
commence. Significant uncertainty exists as to the reimbursement status of
approved health care products.
We may not be able to obtain or maintain our desired price for our
products. Our products may not be considered cost effective. Also, adequate
third-party reimbursement may not be available to enable us to maintain price
levels sufficient to realize an appropriate return on our investment in product
development. Legislation and regulations affecting the pricing of
pharmaceuticals may change. If adequate coverage and reimbursement levels are
not provided by the government and third-party payors for our products, the
market acceptance of these products would be adversely affected, which would
harm our business, financial condition and results of operations.
We may be unable to obtain regulatory approval for our potential products.
We must obtain regulatory approval for the commercial sale of any of our
potential products or to promote INTEGRILIN for expanded indications. We must
demonstrate through preclinical testing and clinical trials and, to the FDA's
satisfaction, that each product is safe and effective for use in indications for
which approval is requested. The results from preclinical testing and early
clinical trials may not be predictive of results obtained in large clinical
trials. Companies in the pharmaceutical and biotechnology industries, including
us, have suffered significant setbacks in various stages of clinical trials,
even in advanced clinical trials after promising results had been obtained in
earlier trials.
6
<PAGE>
The development of safe and effective products is highly uncertain and
subject to numerous risks. Product candidates that may appear to be promising in
development may not reach the market for a number of reasons. Product candidates
may:
. be found ineffective or cause harmful side effects during clinical
trials;
. take longer to progress through clinical trials than had been
anticipated;
. fail to receive necessary regulatory approvals;
. prove impracticable to manufacture in commercial quantities at
reasonable cost and with acceptable quality; and
. fail to achieve market acceptance.
Completion of research, preclinical testing and clinical trials may take
many years and the length of time varies substantially with the type,
complexity, novelty and intended use of the product. Delays or rejections may be
encountered based upon many factors. Our current development programs may not be
successfully completed. Our regulatory applications to conduct clinical trials
may not be allowed to proceed by the FDA or other regulatory authorities, or
clinical trials may not commence as planned.
In addition, due to the substantial demand for clinical trial sites in the
cardiovascular area we may have difficulty obtaining sufficient patient
populations or clinician support to conduct our clinical trials as planned and
may have to expend substantial additional funds to obtain access to resources or
delay or modify our plans significantly.
If we are unable to protect our patents and proprietary rights we may not be
able to compete successfully.
We rely on patent and trade secret protection for significant new
technologies, products and processes because of the long development time,
uncertainty and high cost associated with bringing a new product to the
marketplace. The enforceability of patents issued to companies in this industry
can be highly uncertain and involve complex legal and technical questions for
which the legal principles are largely unresolved. Our success will depend in
part on our ability to obtain and enforce patent protection for our technology
both in the United States and other countries. While we are seeking and/or
maintaining patents for INTEGRILIN(R) (eptifibatide) Injection and our product
candidates, patents may not issue and issued patents may afford limited or no
protection. Additionally, we may not be successful in enforcing our patents and
avoiding infringement of patents granted to others.
We may be required to obtain licenses to patents or other proprietary
rights from third parties. Licenses required under any patents or proprietary
rights may not be made available on terms acceptable to us, if at all. If we do
not obtain required licenses, we may encounter delays in product development
while attempting to redesign products or methods or we could find the
development, manufacture or sale of such products requiring licenses to be
foreclosed. Further, we could incur substantial costs in defending any patent
litigation brought against us or in asserting our patent rights, including those
rights licensed to us by others.
In October 1997, a patent opposition was filed in Europe by another company
against the claims of a patent granted to us in Europe covering broad, generic
claims for INTEGRILIN, as well as numerous related compounds that are not part
of our core technology. The opposition asserts that all claims of the patent
are unpatentable. We intend to vigorously defend our patent. However, this
patent opposition may result in an unfavorable outcome which could adversely
affect the ability to market INTEGRILIN in Europe.
Our common stock price is volatile and an investment in our stock could suffer a
decline in value.
The market prices for securities of pharmaceutical and biotechnology
companies, including our common stock, have historically been highly volatile.
The market has from time to time experienced significant price and volume
fluctuations that are unrelated to the operating performance of particular
companies. The following are some of the factors that may have a significant
effect on the market price of our common stock:
. fluctuations in our operating results;
. announcements of technological innovations or new therapeutic products
by us or our competitors;
. announcements regarding collaborative agreements;
7
<PAGE>
. governmental regulation;
. our clinical trial results;
. developments in patent or other proprietary rights;
. public concern as to the safety of drugs developed by us or others;
. comments and expectations of results made by securities analysts; and
. general market conditions;
In particular, the realization of any of the risks described in this
prospectus could have a significant and adverse impact on the market price of
our common stock.
Substantial leverage and debt service obligations may adversely affect our cash
flow.
We have significant outstanding debt, including primarily the notes. We may be
unable to generate cash sufficient to pay the principal or interest on our debt
when due. We also expect to add additional equipment loans and lease lines to
finance capital expenditures and may obtain additional long term debt, working
capital lines of credit and lease lines. We cannot assure you that any of these
financing arrangements will be available.
Our substantial leverage could have significant additional negative
consequences, including:
. increasing our vulnerability to general adverse economic and industry
conditions;
. limiting our ability to obtain additional financing;
. requiring the dedication of a substantial portion of our expected cash flow
from operations to service our indebtedness, thereby reducing the amount of
our expected cash flow available for other purposes, including capital
expenditures;
. limiting our flexibility in planning for, or reacting to, changes in our
business and the industry in which we compete; and
. placing us at a possible competitive disadvantage to less leveraged
competitors and competitors that have better access to capital resources.
We may require additional funds that may be difficult to obtain in order to
continue our business as planned.
We will require substantial funds to market INTEGRILIN(R) (eptifibatide)
Injection and conduct the costly and time-consuming research, preclinical
testing and clinical trials necessary to develop and optimize our technology and
potential products, to establish manufacturing, marketing and sales capabilities
for product candidates and to bring any such products to market. Our future
capital requirements will depend upon many factors, including:
. product commercialization activities;
8
<PAGE>
. continued scientific progress in the research and development of our
technology and drug programs;
. our ability to establish and maintain collaboration arrangements;
. progress with preclinical testing and clinical trials;
. the time and costs involved in obtaining regulatory approvals; and
. the costs involved in preparing, filing, prosecuting, maintaining and
enforcing patent claims or trade secrets.
We may seek ongoing funding through collaboration arrangements and public
or private financings, including equity and debt financings. Additional funding
may not be available on favorable terms, if at all. In that event, we may need
to delay or curtail our research and development activities to a significant
extent.
If we do not attract and retain key employees and consultants our business could
be impaired.
We are highly dependent on the principal members of our scientific and
management staff. In addition, we rely on consultants to assist us in
formulating our research and development strategy. Attracting and retaining
qualified personnel and consultants is critical to our success. For example, we
are currently conducting a search for a chief financial officer. We face
competition for qualified individuals from numerous pharmaceutical and
biotechnology companies, universities and other research institutions. If we
are not able to attract and retain these individuals, our business could be
impaired.
We may be subject to product liability claims and our insurance coverage may not
be adequate to cover these claims.
The testing, marketing and sale of human pharmaceutical products expose us
to significant and unpredictable risks of product liability claims in the event
that the use of our technology or products is alleged to have resulted in
adverse effects. These risks will exist even with respect to any products that
receive regulatory approval for commercial sale. While we have obtained
liability insurance for our products, there can be no assurance that it will be
sufficient to satisfy any liability that may arise. There also can be no
assurance that adequate insurance coverage will be available in the future at
acceptable cost, if at all, or that a product liability claim would not
adversely affect our business, financial condition or results of operations.
Accidents resulting from the use of hazardous materials in our business may
result in liability.
Our research and development involves the controlled use of hazardous
materials, chemicals and various radioactive substances. Although we believe
that our safety procedures for handling and disposing of such materials comply
with the standards prescribed by state and federal regulations, the risk of
accidental contamination or injury from these materials cannot be completely
eliminated. In the event of such an accident, we could be held liable for any
damages that result and any such liability could exceed our resources and have a
material adverse effect on our business, financial condition and results of
operations.
Anti-takeover effects of Delaware Law and certain charter provisions could make
the acquisition of our company by another company more difficult.
Our Board of Directors has the authority to issue up to 5,000,000 shares of
preferred stock and to determine the price, rights, preferences and privileges
of those shares without any further vote or action by our stockholders. The
rights of the holders of our common stock will be subject to and may be
adversely affected by, the rights of the holders of any preferred stock that may
be issued in the future. While we have no present intention to issue shares of
preferred stock, such issuance, while providing desirable flexibility in
connection with possible acquisitions and other corporate purposes, could have
the effect of making it more difficult for a third party to acquire a majority
of our outstanding voting stock.
In addition, we are subject to the anti-takeover provisions of Section 203
of the Delaware General Corporation Law, which prohibits us 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.
The application of Section 203 could have the effect of delaying or preventing a
change in our control.
9
<PAGE>
In January 1995, our Board of Directors adopted a Preferred Share Purchase
Rights Plan, commonly referred to as a "poison pill." In addition, our Restated
Certificate of Incorporation does not permit cumulative voting. The Restated
Certificate also includes a "Fair Price Provision" that requires the approval of
the holders of at least 66 2/3% of our voting stock as a condition to a merger
or certain other business transactions with or proposed by, a holder of 15% or
more of our voting stock, except where disinterested Board or stockholder
approval is obtained or certain minimum price criteria and other procedural
requirements are met. These provisions and other provisions of the Restated
Certificate, our bylaws and Delaware corporate law, may have the effect of
deterring hostile takeovers or delaying or preventing changes in control or
management of COR, including transactions in which stockholders might otherwise
receive a premium for their shares over then current market prices.
Since the notes are subordinated, our assets will be available to pay
obligations on the notes only after all senior debt has been paid in full.
The notes are unsecured and subordinated in right of payment to all of our
existing and future senior debt, as defined in the indenture governing the
notes. As a result, in the event of bankruptcy, liquidation or reorganization or
upon acceleration of the notes due to an event of default, as defined below and
in specific other events, our assets will be available to pay obligations on the
notes only after all senior debt has been paid in full in cash or other payment
satisfactory to the holders of senior debt. There may not be sufficient assets
remaining to pay amounts due on any or all of the notes then outstanding.
The indenture does not prohibit or limit the incurrence of senior debt or the
incurrence of other indebtedness and other liabilities by us. The incurrence of
additional indebtedness and other liabilities by us could adversely affect our
ability to pay obligations on the notes. As of March 31, 2000, we had
approximately $4.1 million of indebtedness outstanding that would constitute
senior debt. We anticipate that from time to time we will incur additional
indebtedness, including senior debt. See "Description of the Notes --
Subordination".
If a change in control were to occur, we may not have sufficient funds to pay
the redemption price for all the notes tendered by holders.
Upon a "change in control," as defined in the indenture, each holder of notes
has rights, at the holder's option, to require us to redeem all or a portion of
the holder's notes. Although the indenture allows us, subject to satisfaction of
conditions, to pay the redemption price in shares of common stock, if a change
in control were to occur, we may not have sufficient funds to pay the redemption
price for all the notes tendered by holders.
Any future credit agreements or other agreements relating to other
indebtedness, including other senior debt, to which we become a party may
contain restrictions or prohibitions on the payment of the redemption price
while the indebtedness is outstanding. In the event a change in control occurs
at a time when we are prohibited from purchasing or redeeming the notes, we
could seek the consent of lenders to the purchase of the notes or could attempt
to refinance the borrowings that contain this prohibition. If we do not obtain a
consent or repay these borrowings, we would remain prohibited from purchasing or
redeeming the notes. Our failure to redeem the notes would constitute an event
of default pursuant to the indenture under which the notes have been issued,
which might constitute a default under the terms of other indebtedness that we
may enter into from time to time. In these circumstances, the subordination
provisions in the indenture would likely restrict payments to the holders of the
notes.
The definition of "change in control" in the indenture is limited to specified
transactions and may not include other events that might adversely affect our
financial condition. In addition, the requirement that we offer to repurchase
the notes upon a change in control does not necessarily afford holders of the
notes protection in the event of a highly leveraged transaction, reorganization,
merger or similar transaction involving us. See "Description of the Notes --
Repurchase at Option of Holders Upon a Change in Control".
Because there is no public market for the notes being offered, you may not be
able to resell them easily or at a favorable price.
There is no public market for the notes and we are not certain of:
. the liquidity of any market that may develop;
. the ability of the holders to sell their notes; or
. the price at which the holders would be able to sell their notes.
If such a market were to develop, the notes could trade at prices that may
be higher or lower than the principal amount or purchase price, depending on
many factors, including prevailing interest rates, the market for similar notes,
and our financial performance. We do not intend to list the notes for trading
on any national securities exchange or on the Nasdaq National Market and can
give no assurance about the development of any trading market for the notes.
Goldman Sachs & Co., Chase H&Q, a division of Chase Securities Inc., CIBC
World Markets Corp., FleetBoston Robertson Stephens Inc. and Warburg Dillon Read
LLC have advised us that they presently make a market in the notes. They are
not obligated, however, to make a market for the notes, and any such market-
making may be discontinuted at any time at their sole discretion. In addition,
such market-making activity will be subject to the limits imposed by the
Securities Act and the Exchange Act. Accordingly, no assurance can be given as
to the development or liquidity of any market for the notes.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Some of the statements in this prospectus and the documents incorporated by
reference are forward-looking statements. These statements are based on our
current expectations, assumptions, estimates and projections about our business
and our industry, and involve known and unknown risks, uncertainties and other
factors that may cause our or our industry's results, levels of activity,
performance or achievement to be materially different from any future results,
levels of activity, performance or achievements expressed or implied in or
contemplated by the forward-looking statements. Words such as "believe,"
"anticipate," "expect," "intend," "plan," "will," "may," "should," "estimate,"
"predict," "potential," "continue," or the negative of such terms or other
similar expressions, identify forward-looking statements. In addition, any
statements that refer to expectations, projections or other characterizations of
future events or circumstances are forward-looking statements. Our actual
results could differ materially from those anticipated in such forward-looking
statements as a result of several factors more fully described under the caption
"Risk Factors" and in the documents incorporated by reference. The forward-
looking statements made in this prospectus relate only to events as of the date
on which the statements are made. We do not intend to update publicly any
forward-looking statements for any reason, even if new information becomes
available or other events occur in the future.
WHERE YOU CAN FIND MORE INFORMATION ABOUT COR AND THIS OFFERING
We have filed with Securities and Exchange Commission a registration
statement on Form S-3 to register the common stock offered by this prospectus.
However, this prospectus does not contain all of the information contained in
the registration statement and the exhibits and schedules to the registration
statement. We strongly encourage you to carefully read the registration
statement and the exhibits and schedules to the registration statement.
We file annual, quarterly and special 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, DC, New York, New York and Chicago,
Illinois. You can request copies of these documents by contacting the SEC and
paying a fee for the copying cost. Please call the SEC at 1-800-SEC-0330 for
further information on the public reference rooms. Our SEC filings are also
available to the public from the SEC's website at www.sec.gov.
The SEC allows us to "incorporate by reference" the information contained in
documents that we file with them, which means that we can disclose important
information to you by referring you to those documents. The information
incorporated by reference is considered to be part of this prospectus.
Information in this prospectus supersedes information incorporated by reference
that we filed with the SEC prior to the date of this prospectus, while
information that we file later with the SEC will automatically update and
supersede this information. We incorporate by reference the documents listed
below and any future filings we will make with the SEC under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934:
1. Our Annual Report on Form 10-K for the fiscal year ended December 31, 1999;
2. Our Quarterly Report on Form 10-Q for the fiscal quarter ended March 31,
2000;
3. Our Current Report on Form 8-K, dated February 16, 2000;
4. Our Current Report on Form 8-K, dated March 3, 2000; and
10
<PAGE>
5. The description of our common stock contained in our Registration Statement
on Form 8-A filed on May 17, 1991.
You may request a copy of these filings, at no cost to you, by writing or
telephoning us at: COR Therapeutics, Inc., 256 East Grand Avenue, South San
Francisco, California, 94080 Telephone (650) 244-6800.
Our common stock is quoted on the Nasdaq National Market under the symbol
"CORR". You may inspect reports and other information concerning us at the
offices of the National Association of Securities Dealers, Inc., 1735 K Street,
N.W., Washington, D.C. 20006.
11
<PAGE>
USE OF PROCEEDS
We will not receive any proceeds from the sale of the notes or the shares
of common stock offered hereby. See "Selling Security Holders".
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of earnings to fixed charges for
each of the last five years and for the three months ended March 31, 2000:
<TABLE>
<CAPTION>
Three months
Years ended December 31, ended March 31,
------------------------------------------ ------------------
<S> <C> <C> <C> <C> <C> <C>
1995 1996 1997 1998 1999 2000
------------------------------------------ ------------------
Ratio of earnings to fixed
charges (1)......................... - - - - - -
</TABLE>
(1) Earnings for the years ended December 31, 1995, 1996, 1997, 1998 and 1999
and the three months ended March 31, 2000 were insufficient to cover fixed
charges by an amount equal to the net loss for the period.
12
<PAGE>
DESCRIPTION OF THE NOTES
The notes were issued under a document called the "indenture." The
indenture is a contract between us and Firstar Bank, N.A., who is serving as
trustee. The indenture and the notes are governed by New York law. Because this
section is a summary, it does not describe every aspect of the notes. You should
read the indenture for a full description of the terms of the notes. We will
provide a copy, at no charge, if you contact us. The indenture is also an
exhibit to our Quarterly Report on Form 10-Q for the quarter ended March 31,
2000, which is incorporated by reference in this prospectus. This summary is
subject to and qualified in its entirety by reference to all the provisions of
the indenture, including definitions of certain terms used in the indenture. For
example, in this section we use capitalized words to signify defined terms that
have been given special meaning in the indenture. We describe the meaning for
only the more important terms. We also include references in parentheses to
certain sections of the indenture. Wherever we refer to particular sections or
defined terms, those sections or defined terms are incorporated by reference
here. In this section, references to "COR" or "we" or "us" refer solely to COR
Therapeutics, Inc. and not any future subsidiaries.
General
The notes are 5% convertible subordinated securities due March 1, 2007.
There is an aggregate of $300 million aggregate principal amount of notes
authorized and outstanding. The notes represent general, unsecured obligations
of COR. The notes are subordinated, which means that they rank behind certain of
our indebtedness as described below. Payment of the full principal amount of the
notes is due on March 1, 2007.
The notes bear interest at the annual rate of 5% from February 24, 2000. We
will pay interest semi-annually on March 1 and September 1 of each year,
beginning September 1, 2000, until the principal is paid or made available for
payment. Interest will be paid to the person in whose name the note is
registered at the close of business on the preceding February 15 or August 15,
as the case may be. Interest payable per $1,000 principal amount of notes for
the period from February 24, 2000 to September 1, 2000, will be $25.97.
You may convert the notes into shares of common stock initially at the
conversion rate of 14.8028 shares per $1,000 principal amount at any time before
the close of business on March 1, 2007, unless the notes have been previously
redeemed or repurchased. The conversion rate may be adjusted as described
below.
We may redeem the notes at our option at any time on or after March 1,
2003, in whole or in part, at the redemption prices set forth below under
"Optional Redemption," plus accrued and unpaid interest to the redemption date.
If there is a change in control of COR, you may have the right to require us to
repurchase your notes as described below under "Repurchase at Option of Holders
Upon a Change in Control."
Form, Denomination, Transfer, Exchange and Book-Entry Procedures
We issued the notes:
. only in fully registered form;
. without interest coupons; and
. in denominations of $1,000 and greater multiples.
The notes are evidenced by one or more global notes which we deposited with
the trustee as custodian for the Depositary Trust Company, as the depositary and
registered in the name of Cede & Co. ("Cede"), as nominee of DTC. The global
note and any notes issued in exchange for the global note are subject to
restrictions on transfer and bear a legend regarding those restrictions. Except
as set forth below, record ownership of the global note may be transferred, in
whole or in part, only to another nominee of DTC or to a successor of DTC or its
nominee.
The global note will not be registered in the name of any person, or
exchanged for notes that are registered in the name of any person, other than
DTC or its nominee unless either of the following occurs:
. DTC notifies us that it is unwilling, unable or no longer qualified to
continue acting as the depositary for the global note; or
13
<PAGE>
. an "Event of Default," as described below, with respect to the notes
represented by the global note has occurred and is continuing.
In those circumstances, DTC will determine in whose names any securities
issued in exchange for the global note will be registered.
DTC or its nominee will be considered the sole owner and holder of the
global note for all purposes, and as a result:
. you cannot receive notes registered in your name if they are
represented by the global note;
. you cannot receive certificated, or physical, notes in exchange for
your beneficial interest in the global notes;
. you will not be considered to be the owner or holder of the global
note or any note it represents for any purpose; and
. all payments on the global note will be made to DTC or its nominee.
The laws of some jurisdictions require that certain kinds of purchasers,
such as certain insurance companies, can only own securities in definitive, or
certificated form. These laws may limit your ability to transfer your beneficial
interests in the global note to these types of purchasers.
Only institutions, such as a securities broker or dealer, that have
accounts with DTC or its nominee, called "participants", and persons that may
hold beneficial interests through participants can own a beneficial interest in
the global note. The only place where the ownership of beneficial interests in
the global note will appear and the only way the transfer of those interests can
be made will be on the records kept by DTC, in the case of their participants'
interests, and the records kept by those participants, in the case of persons
held by participants on their behalf.
Secondary trading in bonds and notes of corporate issuers is generally
settled in clearing-house, or next-day, funds. In contrast, beneficial interests
in a global note usually trade in DTC's same-day funds settlement system, and
settle in immediately available funds. We make no representations as to the
effect that settlement in immediately available funds will have on trading
activity in those beneficial interests.
We are obligated make cash payments of interest on, and principal of, and
the redemption or repurchase price of, the global note, as well as any payment
of Liquidated Damages, to Cede, the nominee for DTC, as the registered owner of
the global note. We are obligated make these payments by wire transfer of
immediately available funds on each payment date.
DTC ha informed us that, with respect to any cash payment of interest on,
principal of, or the redemption or repurchase price of, the global note, as well
as any payment of liquidated damages, DTC's practice is to credit participants'
accounts on the payment date with payments in amounts proportionate to their
respective beneficial interests in the notes represented by the global note as
shown on DTC's records, unless DTC has reason to believe that it will not
receive payment on that payment date. Payments by participants to owners of
beneficial interests in notes represented by the global note held through
participants will be the responsibility of those participants, as is now the
case with securities held for the accounts of customers registered in "street
name."
We will send any redemption notices to Cede. We understand that if less
than all the notes are being redeemed, DTC's practice is to determine by lot the
amount of the holdings of each participant to be redeemed.
We also understand that neither DTC nor Cede will consent or vote with
respect to the notes. We have been advised that under its usual procedures, DTC
will mail an "omnibus proxy" to us as soon as possible after the record date.
The omnibus proxy assigns Cede's consenting or voting rights to those
participants to whose accounts the notes are credited on the record date
identified in a listing attached to the omnibus proxy.
Because DTC can only act on behalf of participants, who in turn act on
behalf of indirect participants, the ability of a person having a beneficial
interest in the principal amount represented by the global note to pledge the
interest to persons or entities that do not participate in the DTC book-entry
system, or otherwise take actions in respect of that interest, may be affected
by the lack of a physical certificate evidencing its interest.
14
<PAGE>
DTC has advised us that it will take any action permitted to be taken by a
holder of notes, including the presentation of notes for exchange, only at the
direction of one or more participants to whose account with DTC interests in the
global note are credited and only in respect of such portion of the principal
amount of the notes represented by the global note as to which such participant
has, or participants have, given such direction.
DTC has also advised us as follows: DTC is a limited purpose trust company
organized under the laws of the State of New York, a member of the Federal
Reserve System, a "clearing corporation" within the meaning of the Uniform
Commercial Code, as amended, and a "clearing agency" registered pursuant to the
provisions of Section 17A of the Exchange Act. DTC was created to hold
securities for its participants and facilitate the clearance and settlement of
securities transactions between participants through electronic book-entry
changes in accounts of its participants. Participants include securities
brokers and dealers, banks, trust companies and clearing corporations and may
include certain other organizations. Some participants, or their
representatives, together with other entities, own DTC. Indirect access to the
DTC system is available to other entities such as banks, brokers, dealers and
trust companies that clear through or maintain a custodial relationship with a
participant, either directly or indirectly.
DTC's policies and procedures, which may change periodically, will apply to
payments, transfers, exchanges and other matters relating to beneficial
interests in the global note. We and the trustee have no responsibility or
liability for any aspect of DTC's or any participants' records relating to
beneficial interests in the global note, including for payments made on the
global note, and we and the trustee are not responsible for maintaining,
supervising or reviewing any of those records.
Conversion Rights
You may, at your option, convert any portion of the principal amount of a
note, in $1,000 increments into shares of common stock at any time prior to the
close of business on the March 1, 2007, unless the note has been previously
redeemed or repurchased, at a conversion rate equal to 14.8028 shares per $1,000
principal amount of notes. This conversion rate is equivalent to a conversion
price of $67.56 per share. The conversion rate is subject to adjustment as
described below. Your right to convert a note called for redemption or delivered
for repurchase will terminate at the close of business on the business day
immediately preceding the redemption date or repurchase date for that note,
unless we default in making the payment due upon redemption or repurchase.
The holder of a note can convert the note by delivering the note at the
Corporate Trust Office of the trustee accompanied by a duly signed and completed
notice of conversion, a copy of which may be obtained from the trustee. In the
case of a global note, DTC will effect the conversion upon notice from the
holder of a beneficial interest in the global note in accordance with DTC's
rules and procedures. The conversion date will be the date on which the note
and the duly signed and completed notice of conversion are so delivered. As
promptly as practicable on or after the conversion date, we will issue and
deliver to the trustee a certificate or certificates for the number of full
shares of common stock issuable upon conversion, together with payment in lieu
of any fraction of a share. The certificates will be sent by the trustee to the
Conversion Agent for delivery to the holder of the note being converted. The
shares of common stock issuable upon conversion of the notes will be fully paid
and nonassessable and will also rank equally with other shares of our common
stock outstanding from time to time.
If you surrender a note for conversion on a date that is not an Interest
Payment Date, you will not be entitled to receive any interest for the period
from the preceding Interest Payment Date to the date of conversion, except as
described below. However, if you are a holder of a note on a Regular Record
Date, including a note surrendered for conversion after the Regular Record Date,
you will receive the interest payable on such note on the next succeeding
Interest Payment Date. Accordingly, any note surrendered for conversion during
the period from the close of business on a Regular Record Date to the opening of
business on the next succeeding Interest Payment Date must be accompanied by
payment of an amount equal to the interest payable on such Interest Payment Date
on the principal amount of notes being surrendered for conversion. However, you
will not be required to make that payment if you are converting a note, or a
portion of a note, that we have called for redemption, or that you are entitled
to require us to repurchase from you, if your conversion right would terminate
because of the redemption or repurchase between the Regular Record Date and the
close of business on the next succeeding Interest Payment Date.
No other payment or adjustment for interest, or for any dividends on our
common stock, will be made upon conversion. If you receive common stock upon
conversion of a note, you will not be entitled to receive any dividends payable
to holders of common stock as of any record date that precedes the close of
business on the conversion date. We will not issue fractional shares upon
conversion of notes. Instead, we will pay an amount in cash based on the market
price of the common stock at the close of business on the conversion date.
15
<PAGE>
If you deliver a note for conversion, you will not be required to pay any
taxes or duties in respect of the issue or delivery of common stock on
conversion. However, we are not required to pay any tax or duty that may be
payable in respect of any transfer involved in the issue or delivery of the
common stock in a name other than that of the holder of the note. We will not
issue or deliver certificates representing shares of common stock unless the
person requesting the issuance or delivery has paid to us the amount of any such
tax or duty or has established to our satisfaction that no such tax or duty is
payable.
The conversion rate is subject to adjustment if:
(1) there is a dividend or other distribution payable in common stock on
shares of our capital stock;
(2) we issue to all holders of common stock rights, options or warrants
entitling them to subscribe for or purchase common stock at less than the
then current market price, calculated as described in the indenture, of our
common stock; however, if those rights, options or warrants are only
exercisable upon the occurrence of certain triggering events, then the
conversion rate will not be adjusted until the triggering events occur;
(3) we subdivide, reclassify or combine our common stock;
(4) we distribute to all holders of our common stock evidences of our
indebtedness, shares of capital stock, cash or assets, including
securities, but excluding:
. those dividends, rights, options, warrants and distributions
referred to in paragraphs (1) and (2) above,
. dividends and distributions paid exclusively in cash, and
. distributions upon mergers or consolidations;
(5) we make a distribution consisting exclusively of cash to all holders
of our common stock if: the aggregate amount of the distribution combined
together with:
. other such all-cash distributions made within the preceding 12
months in respect of which no adjustment has been made, and
. any cash and the fair market value of other consideration payable
in respect of any tender offer by us or any of our subsidiaries
for our common stock concluded within the preceding 12 months in
respect of which no adjustment has been made
exceeds 10% of our market capitalization, being the product of the Current
Market Price per share of our common stock on the record date for such
distribution and the number of shares of common stock then outstanding; or
(6) the successful completion of a tender offer made by COR or any of
our subsidiaries for our common stock which involves aggregate
consideration that, together with:
. any cash and other consideration payable in a tender offer by us
or any of our subsidiaries for our common stock expiring within
the 12 months preceding the expiration of such tender offer in
respect of which no adjustment has been made, and
. the aggregate amount of any such all-cash distributions referred
to in paragraph (5) above to all holders of common stock within
the 12 months preceding the expiration of such tender offer in
respect of which no adjustments have been made
exceeds 10% of our market capitalization on the expiration of such tender
offer.
We reserve the right to make such increases in the conversion rate in
addition to those required by the provisions described above as we may consider
to be advisable so that any event treated for United States federal income tax
purposes as a dividend of stock or stock rights will not be taxable to the
recipients. No adjustment of the conversion rate will be required to be made
until the cumulative
16
<PAGE>
adjustments amount to 1.0% or more of the conversion rate. We will compute any
adjustments to the conversion rate and give notice to the holders of any such
adjustments.
If we merge or consolidate with another person or sell or transfer all or
substantially all of our assets, each note then outstanding will, without the
consent of the holder of any note, become convertible only into the kind and
amount of securities, cash and other property receivable upon such
consolidation, merger, sale or transfer by a holder of the number of shares of
common stock into which the note was convertible immediately prior to the
merger, consolidation or sale. This calculation will be made based on the
assumption that the holder of common stock failed to exercise any rights of
election that the holder may have to select a particular type of consideration.
The adjustment will not be made for a merger that does not result in any
reclassification, conversion, exchange or cancellation of our common stock.
We may, from time to time, increase the conversion rate by any amount for
any period of at least 20 days if our board of directors has determined that
such increase would be in our best interests. If our board of directors makes
such a determination, it will be conclusive. We will give holders of notes at
least 15 days' notice of such an increase in the conversion rate. No such
increase shall be taken into account for purposes of determining whether the
closing price of the common stock exceeds the conversion price by 105% in
connection with an event which otherwise would be a "change in control", as
described below.
If at any time we make a distribution of property to our stockholders that
would be taxable to such stockholders as a dividend for United States federal
income tax purposes, e.g., distributions of evidences of indebtedness or assets
of COR, but generally not stock dividends on common stock or rights to subscribe
for common stock, and, pursuant to the anti-dilution provisions of the
indenture, the number of shares into which notes are convertible is increased,
that increase may be deemed for United States federal income tax purposes to be
the payment of a taxable dividend to holders of notes. See "Certain United
States Federal Income Tax Consequences -- U.S. Holders".
Subordination
The notes are subordinated and, as a result, the payment of the principal,
any premium and interest on the notes, including amounts payable on any
redemption or repurchase, are subordinated to the prior payment in full of all
of our senior debt. "Senior debt" means the principal of, and premium, if any,
and interest, including all interest accruing subsequent to the commencement of
any bankruptcy or similar proceeding, whether or not a claim for post-petition
interest is allowable as a claim in any such proceeding, on, and all fees and
other amounts payable in connection with, the following, whether absolute or
contingent, secured or unsecured, due or to become due, outstanding on the date
of the indenture or thereafter created, incurred or assumed:
. all our indebtedness evidenced by a credit or loan agreement, note,
bond, debenture or other similar instrument;
. all our obligations for money borrowed;
. all our obligations as lessee under leases required to be capitalized
on the balance sheet of the lessee under generally accepted accounting
principles;
. all our obligations under interest rate and currency swaps, caps,
floors, collars, hedge agreements, forward contracts or similar
agreements or arrangements;
. all our obligations with respect to letters of credit, bankers'
acceptances and similar facilities, including related reimbursement
obligations;
. all our obligations issued or assumed as the deferred purchase price
of property or services, but excluding trade accounts payable and
accrued liabilities arising in the ordinary course of business;
. all our obligations of the type referred to above of another person
and all dividends of another person, the payment of which, in either
case, we have assumed or guaranteed, or for which we are responsible
or liable, directly or indirectly, jointly or severally, as obligor,
guarantor or otherwise, or which is secured by a lien on our property;
and
. renewals, extensions, modifications, replacements, restatements and
refundings of, or any indebtedness or obligation issued in exchange
for any indebtedness or obligation described in the bullets above.
17
<PAGE>
Senior debt will not include any indebtedness or obligation if the terms of
the indebtedness or obligation, or the terms of the instrument under which the
indebtedness or obligation is issued, expressly provide that the indebtedness or
obligation is not superior in right of payment to the notes. In addition, senior
debt will not include any particular indebtedness or obligation that we may owe
to any of our direct or indirect subsidiaries.
We are prohibited from making any payment of principal, premium or interest
on the notes, or redemption or repurchase of the notes, if either of the
following occurs:
. we default in our obligations to pay principal, premium, interest or
other amounts on our senior debt, including a default under any
redemption or repurchase obligation, and the default continues beyond
any grace period that we may have to make those payments; or
. an "Event of Default" occurs and is continuing on any Designated
Senior Debt, as defined below, and (1) the event of default permits
the holders of the Designated Senior Debt to accelerate its maturity
and (2) the trustee has received a notice, referred to as a "Payment
Blockage Notice," of the default from a holder of the Designated
Senior Debt. See section entitled "Events of Default."
If payments of the notes have been blocked by a payment default on senior
debt, payments on the notes may resume when the payment default has been cured
or waived. If payments on the notes have been blocked by a nonpayment default,
payments on the notes may resume on the earlier of (1) the date the nonpayment
default is cured or waived or (2) 179 days after the Payment Blockage Notice is
received.
A nonpayment default that existed on the day a Payment Blockage Notice was
delivered to the trustee can not be used as the basis for any subsequent Payment
Blockage Notice. In addition, once a holder of Designated Senior Debt has
blocked payment on the notes by giving a Payment Blockage Notice, no new period
of payment blockage can be commenced until both of the following are satisfied:
. 365 days have elapsed since the effectiveness of the immediately prior
Payment Blockage Notice; and
. all scheduled payments of principal, any premium and interest on the
notes that have come due have been paid in full in cash.
"Designated Senior Debt" means our obligations under any particular senior
debt in which the instrument creating or evidencing the debt, or the assumption
or guarantee of the debt, or related agreements or documents to which we are a
party, expressly provides that the indebtedness will be "Designated Senior Debt"
for purposes of the indenture. That instrument, agreement or other document may
place limitations and conditions on the right of that senior debt to exercise
the rights of Designated Senior Debt.
In addition, upon any acceleration of the principal due on the notes as a
result of an Event of Default or payment or distribution of our assets to
creditors upon any dissolution, winding up, liquidation or reorganization,
whether voluntary or involuntary, marshaling of assets, assignment for the
benefit of creditors, or in bankruptcy, insolvency, receivership or other
similar proceedings, all principal, premium, interest and other amounts due on
all senior debt must be paid in full before you will be entitled to receive any
payment on account of the notes. Because of this subordination, in the event of
insolvency, our creditors who are holders of senior debt may recover more,
ratably, than you would, and this subordination may reduce or eliminate payments
to you. As of March 31, 2000, we had approximately $4.1 million of senior debt
outstanding.
COR does not currently have any subsidiaries. However, the notes are
"structurally subordinated" to all indebtedness and other liabilities, including
trade payables and lease obligations, of any future subsidiaries. This occurs
because any right we have to receive any assets of our subsidiaries upon their
liquidation or reorganization, and the consequent right of the holders of the
notes to participate in those assets, will be effectively subordinated to the
claims of that subsidiary's creditors, including trade creditors, except to the
extent that we are recognized as a creditor of the subsidiary, in which case our
claims would still be subordinate to any security interest in the assets of the
subsidiary and any indebtedness of the subsidiary senior to that held by us.
The indenture does not limit our ability or the ability of any of our
subsidiaries to incur indebtedness, including senior debt.
18
<PAGE>
Optional Redemption
On and after March 1, 2003, we may redeem the notes, in whole or in part,
at our option, at the redemption prices specified below. The redemption price,
expressed as a percentage of principal amount, is as follows for the 12-month
periods beginning on March 1 of the following years:
Redemption
Year Price
---- ----------
2003................................. 102.857%
2004................................. 102.143%
2005................................. 101.429%
2006................................. 100.714%
and 100% of the principal amount on and after March 1, 2007. In each case we
will also pay accrued interest to the redemption date. The indenture requires us
to give notice of redemption not more than 60 and not less than 30 days before
the redemption date.
No "sinking fund" is provided for the notes, which means that the indenture
does not require us to redeem or retire the notes periodically.
Repurchase at Option of Holders Upon a Change in Control
If a change in control, as defined below, occurs, you will have the right,
at your option, to require us to repurchase all of your notes not called for
redemption, or any portion of the principal amount of your notes that is equal
to $5,000 or any greater integral multiple of $1,000. The price we are required
to pay is 100% of the principal amount of the notes to be repurchased, together
with interest accrued to the repurchase date.
At our option, instead of paying the repurchase price in cash, we may pay
the repurchase price in common stock valued at 95% of the average of the closing
sales prices of the common stock for the five trading days immediately preceding
and including the third day prior to the repurchase date. We may only pay the
repurchase price in common stock if we satisfy conditions provided in the
indenture.
Within 30 days after the occurrence of a change in control, we are
obligated to give you notice of the change in control and of the repurchase
right arising as a result of the change in control. We must also deliver a copy
of this notice to the trustee. To exercise the repurchase right, you must
deliver on or before the 30th day after the date of our notice irrevocable
written notice to the trustee of your exercise of your repurchase right,
together with the notes with respect to which that right is being exercised. We
are required to make the repurchase on the date that is 45 days after the date
of our notice.
A "change in control" will be deemed to have occurred at the time after the
notes are originally issued that any of the following occurs:
(1) any person, including any syndicate or group deemed to be a "person"
under Section 13(d)(3) of the Exchange Act, acquires beneficial ownership,
directly or indirectly, through a purchase, merger or other acquisition
transaction or series of transactions, of shares of our capital stock
entitling that person to exercise 50% or more of the total voting power of
all shares of our capital stock entitled to vote generally in elections of
directors; however, any acquisition by COR, any subsidiary of COR or any
employee benefit plan of COR will not trigger this provision;
(2) we consolidate with or merge with or into any other person or
another person merges into us, except if the transaction satisfies any of
the following:
. the holders of 50% or more of the total voting power of all
shares of our capital stock entitled to vote generally in
elections of directors immediately prior to the transaction have,
directly or indirectly, 50% or more of the total voting power of
all shares of capital stock of the continuing or surviving
corporation entitled to vote generally in elections of directors
of the continuing or surviving corporation immediately after the
transaction;
. the transaction is a merger which does not result in any
reclassification, conversion, exchange or cancellation of
outstanding shares of our capital stock; and
19
<PAGE>
. the transaction is a merger effected only to change our
jurisdiction of incorporation and it results in a
reclassification, conversion or exchange of outstanding shares of
our common stock only into shares of our common stock or another
corporation.
(3) we convey, transfer, sell, lease or otherwise dispose of all or
substantially all of our assets to another person
However, a change in control will not be deemed to have occurred if the
closing sales price per share of our common stock for any five trading days
within the period of 10 consecutive trading days ending immediately after the
later of the change in control or the public announcement of the change in
control, in the case of a change in control relating to an acquisition of
capital stock, or the period of 10 consecutive trading days ending immediately
before the change in control, in the case of change in control relating to a
merger, consolidation or asset sale, equals or exceeds 105% of the conversion
price of the notes in effect on each of those trading days.
For purposes of these provisions:
. the conversion price is equal to $1,000 divided by the conversion rate
. whether a person is a "beneficial owner" will be determined in accordance
with Rule 13d-3 under the Exchange Act
. "Person" includes any syndicate or group that would be deemed to be a
"person" under Section 13(d)(3) of the Exchange Act
Rule 13e-4 under the Exchange Act requires the dissemination of prescribed
information to security holders in the event of an issuer tender offer and may
apply in the event that the repurchase option becomes available to you. We will
comply with this rule to the extent it applies at that time.
We may, to the extent permitted by applicable law, at any time purchase
notes in the open market or by tender at any price or by private agreement. Any
note that we so purchase may, to the extent permitted by applicable law, be
reissued or resold or may, at our option, be surrendered to the trustee for
cancellation. Any notes surrendered may not be reissued or resold and will be
canceled promptly.
The definition of change in control includes a phrase relating to the
conveyance, transfer, sale, lease or disposition of "all or substantially all"
of our assets. There is no precise, established definition of the phrase
"substantially all" under applicable law. Accordingly, your ability to require
us to repurchase your notes as a result of conveyance, transfer, sale, lease or
other disposition of less than all of our assets may be uncertain.
The foregoing provisions would not necessarily provide you with protection
if we are involved in a highly leveraged or other transaction that may adversely
affect you.
Our ability to repurchase notes upon the occurrence of a change in control
is subject to important limitations. Some of the events constituting a change in
control could cause an event of default under, or be prohibited or limited by,
the terms of other senior debt. As a result, unless we were to obtain a waiver,
a repurchase of the notes could be prohibited under the subordination provisions
of the indenture until the senior debt is paid in full. Further, we cannot
assure you that we would have the financial resources, or would be able to
arrange financing, to pay the repurchase price for all the notes that might be
delivered by holders of notes seeking to exercise the repurchase right. If we
were to fail to repurchase the notes when required following a change in
control, an Event of Default under the indenture would occur, whether or not
such repurchase is permitted by the subordination provisions of the indenture.
Any such default may, in turn, cause a default under our senior debt. See the
section entitled "Subordination."
Mergers and Sales of Assets by COR
We may not consolidate with or merge into any other person or convey,
transfer, sell or lease our properties and assets substantially as an entirety
to any person, and we may not permit any person to consolidate with or merge
into us or convey, transfer, sell or lease such person's properties and assets
substantially as an entirety to us, unless each of the following requirements is
met:
. the person formed by the consolidation or into or with which we merge or
the person to which our properties and assets are conveyed, transferred,
sold or leased, is a corporation, limited liability company, partnership
or trust organized and existing
20
<PAGE>
under the laws of the United States, any State or the District of
Columbia and, if other than us, shall expressly assume the due and
punctual payment of the principal of, any premium, and interest on the
notes and the performance of our other covenants under the indenture
. immediately after giving effect to that transaction, no Event of Default,
and no event which, after notice or lapse of time or both, would become
an Event of Default, shall have occurred and be continuing
. an officer's certificate and legal opinion relating to these conditions
is delivered to the trustee.
Events of Default
Any of the following will constitute Events of Default under the indenture:
. we fail to pay principal of or any premium on any note when due, whether
or not the payment is prohibited by the subordination provisions of the
indenture;
. we fail to pay any interest on any note when due and that default
continues for 30 days, whether or not the payment is prohibited by the
subordination provisions of the indenture;
. we fail to give the notice that we are required to give in the event of a
change in control, whether or not the notice is prohibited by the
subordination provisions of the indenture;
. we fail to perform any other covenant in the indenture and that failure
continues for 60 days after written notice to us by the trustee or the
holders of at least 25% in aggregate principal amount of outstanding
notes;
. failure to pay when due the principal of, or acceleration of, any
indebtedness for money borrowed by us or any of our subsidiaries in
excess of $10 million (excluding equipment and facilities leases) if the
indebtedness is not discharged, or the acceleration is not annulled,
within 30 days after written notice to us by the trustee or the holders
of at least 25% in aggregate principal amount of the outstanding notes;
and
. events of bankruptcy, insolvency or reorganization specified in the
indenture.
Subject to the provisions of the indenture relating to the duties of the
trustee in case an Event of Default shall occur and be continuing, the trustee
will be under no obligation to exercise any of its rights or powers under the
indenture at the request or direction of any of the holders, unless such holders
shall have offered to the trustee reasonable indemnity. Subject to the
provisions for the indemnification of the trustee, the holders of a majority in
aggregate principal amount of the outstanding notes will have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the trustee or exercising any trust or power conferred on the
trustee.
If an Event of Default, other than an Event of Default arising from events
of bankruptcy, insolvency or reorganization, occurs and is continuing, either
the trustee or the holders of at least 25% in principal amount of the
outstanding notes may accelerate the maturity of all notes. After acceleration,
but before a judgment or decree based on acceleration, the holders of a majority
in aggregate principal amount of outstanding notes may, under circumstances set
forth in the indenture, rescind the acceleration if all Events of Default, other
than the nonpayment of principal of the notes which have become due solely
because of the acceleration, have been cured or waived as provided in the
indenture. If an Event of Default arising from events of bankruptcy, insolvency
or reorganization occurs and is continuing, then the principal of, and accrued
interest on, all of the notes will automatically become immediately due and
payable without any declaration or other act on the part of the holders of the
notes or the trustee.
Before you may take any action to institute any proceeding relating to the
indenture, or to appoint a receiver or a trustee, or for any other remedy, each
of the following must occur:
. you must have given the trustee written notice of a continuing Event of
Default;
21
<PAGE>
. the holders of at least 25% of the aggregate principal amount of all
outstanding notes must make a written request of the trustee to take
action because of the default and must have offered reasonable
indemnification to the trustee against the cost, liabilities and expenses
of taking such action; and
. the trustee must not have taken action for 60 days after receipt of such
notice and offer of indemnification.
These limitations do not apply to a suit for the enforcement of payment of
the principal of or any premium or interest on a note, or the repurchase price
payable for a note, on or after the due dates for such payments or of the right
to convert the note in accordance with the indenture.
We will furnish to the trustee annually a statement as to our performance
of our obligations under the indenture and as to any default in performance.
Modification and Waiver
The consent of the holders of a majority in principal amount of the
outstanding notes affected is required to make a modification or amendment to
the indenture. However, a modification or amendment requires the consent of the
holder of each outstanding note affected if it would:
. change the stated maturity of the principal or interest of a note;
. reduce the principal amount, any premium or interest on any note;
. reduce the amount payable upon a redemption or mandatory repurchase;
. modify the provisions with respect to the repurchase rights of holders of
notes in a manner adverse to the holders;
. change the place or currency of payment on a note;
. impair the right to institute suit for the enforcement of any payment on
any note;
. modify the subordination provisions in a manner that is adverse to the
holders of the notes;
. adversely affect the right to convert the notes;
. modify our obligation to deliver information required under Rule 144A to
permit resales of the notes and common stock issued upon conversion of
the notes if we cease to be subject to the reporting requirements under
the Exchange Act;
. reduce the percentage of holders whose consent is needed to modify or
amend the indenture;
. reduce the percentage of holders whose consent is needed to waive
compliance with certain provisions of the indenture or to waive certain
defaults; or
. modify the provisions dealing with modification and waiver of the
indenture.
The holders of a majority in principal amount of the outstanding notes must
consent to waive compliance by us with certain restrictive provisions of the
indenture. The holders of a majority in principal amount of the outstanding
notes may waive any past default, except a default in the payment of principal,
any premium, interest or the repurchase price.
Notes will not be considered outstanding if money for their payment or
redemption has been deposited or set aside in trust for the holders.
We will generally be entitled to set any day as a record date for the
purpose of determining the holders of outstanding notes that are entitled to
take any action under the indenture. In limited circumstances, the trustee will
be entitled to set a record date for action by holders. If a record date is set
for any action to be taken by holders, such action may be taken only by persons
who are holders of
22
<PAGE>
outstanding notes on the record date and must be taken within 180 days following
the record date or such other period as we may specify (or as the trustee may
specify, if it set the record date). This period may be shortened or lengthened
(but not beyond 180 days) from time to time.
Registration Rights
We have entered into a Registration Rights Agreement with the Initial
Purchasers (the "Registration Rights Agreement"). In the Registration Rights
Agreement we have agreed, for the benefit of the holders of the notes and the
shares of common stock issuable upon conversion of the notes, referred to as
"Registrable Securities," that we will, at our expense:
. file with the Commission, within 90 days after the date the notes are
originally issued, a shelf registration statement covering resales of the
Registrable Securities;
. use our reasonable efforts to cause the shelf registration statement to
be declared effective under the Securities Act within 180 days after the
date the notes are originally issued, subject to our right to postpone
having the shelf registration statement declared effective for an
additional 90 days in limited circumstances; and
. use our reasonable efforts to keep effective the shelf registration
statement until two years after the date it is declared effective or, if
earlier, until there are no outstanding Registrable Securities.
We are be permitted to suspend the use of the prospectus that is part of
the shelf registration statement in connection with sales of Registrable
Securities during prescribed periods of time for reasons relating to pending
corporate developments, public filings with the Commission and other events. If
the periods during which we suspend the use of the prospectus exceeds a total of
45 days in any 90-day period or a total of 90 days in any 365-day period the
interest rate on the notes will be increased as described below. We will provide
to each holder of Registrable Securities copies of the prospectus that is a part
of the shelf registration statement, notify each holder when the shelf
registration statement has become effective and take certain other actions
required to permit public resales of the Registrable Securities.
We may, upon written notice to all the holders of notes, postpone having
the shelf registration statement declared effective for a reasonable period not
to exceed 90 days if we possess material non-public information the disclosure
of which would have a material adverse effect on us and our subsidiaries taken
as a whole. Notwithstanding any such postponement, additional interest
("Liquidated Damages") will accrue on the notes if either of the following
events ("Registration Defaults") occurs:
. on or prior to 90 days following the date the notes were originally
issued, a shelf registration statement has not been filed with the
Commission, and
. on or prior to 180 days following the date the notes were originally
issued, the shelf registration statement is not declared effective.
In that case, Liquidated Damages will accrue on the notes from and
including the day following the Registration Default to but excluding the day on
which the Registration Default has been cured. Liquidated Damages will be paid
semi-annually in arrears, with the first semi-annual payment due on the first
Interest Payment Date following the date on which the Liquidated Damages begin
to accrue.
The rates at which Liquidated Damages will accrue will be as follows:
. 0.25% of the principal amount per annum to and including the 90th day
after the Registration Default, and
. 0.5% of the principal amount per annum from and after the 91st day after
the Registration Default.
In addition, the interest rate on the notes will be increased if either of
the following occurs:
. the shelf registration statement ceases to be effective, or we otherwise
prevent or restrict holders of Registrable Securities from making sales
under the shelf registration statement, for more than 45 days, whether or
not consecutive, during any 90-day period, and
23
<PAGE>
. the shelf registration statement ceases to be effective, or we otherwise
prevent or restrict holders of Registrable Securities from making sales
under the shelf registration statement, for more than 90 days, whether or
not consecutive, during any 12-month period.
In either event, the interest rate on the notes will increase by an
additional 0.50% per annum from the 46th day of the 90-day period or the 91st
day of the 12-month period. The increased rate will continue until the earlier
of the following:
. the time the shelf registration statement again becomes effective or the
holders of Registrable Securities are again able to make sales under the
shelf registration statement, depending on which event triggered the
increase in interest rate, and
. two years after the date this registration statement is declared
effective or, if earlier, until there are no outstanding notes or shares
of common stock issuable upon conversion of the notes.
A holder who elects to sell any Registrable Securities pursuant to the
shelf registration statement will be required to be named as a selling security
holder in the related prospectus, may be required to deliver a prospectus to
purchasers, may be subject to certain civil liability provisions under the
Securities Act in connection with those sales and will be bound by the
provisions of the Registration Rights Agreement that apply to a holder making
such an election, including certain indemnification provisions.
After the shelf registration statement becomes effective, we will, upon the
request of any holder of Registrable Securities who has not previously returned
a completed and signed Notice and Questionnaire, as promptly as reasonably
practicable, send a Notice and Questionnaire to such holder. We will not be
required to take any action to name such holder as a selling securityholder in
the shelf registration statement until such holder has returned a completed and
signed Notice and Questionnaire to us. After we receive the Notice and
Questionnaire, we will as promptly as practicable include the Registrable
Securities covered by the Notice and Questionnaire in the shelf registration
statement, subject to restrictions on the timing and number of supplements to
the shelf registration statement provided in the Registration Rights Agreement.
We have agreed in the Registration Rights Agreement to use our reasonable
efforts to cause the shares of common stock issuable upon conversion of the
notes to be quoted on the Nasdaq National Market. However, if the common stock
is not then quoted on the Nasdaq National Market, we will use our reasonable
efforts to cause the shares of common stock issuable upon conversion of the
notes to be quoted or listed on whichever market or exchange the common stock is
then quoted or listed, upon effectiveness of the shelf registration statement.
This summary of certain provisions of the Registration Rights Agreement is
not complete and is subject to, and qualified in its entirety by reference to,
all the provisions of the Registration Rights Agreement, a copy of which will be
made available to beneficial owners of the notes upon request to us.
Notices
We will give notice to holders of the notes by mail to the addresses of the
holders as they appear in the Security Register. Notices will be deemed to have
been given on the date of mailing.
Replacement of Notes
We will replace, at the expense of the holders, notes that become
mutilated, destroyed, stolen or lost upon delivery to the trustee of the
mutilated notes or evidence of the loss, theft or destruction thereof
satisfactory to us and the trustee. In the case of a lost, stolen or destroyed
note, indemnity satisfactory to the trustee and us may be required at the
expense of the holder of the note before a replacement note will be issued.
The Trustee
The trustee for the holders of notes issued under the indenture will be
Firstar Bank, N.A. If an Event of Default shall occur, and shall not be cured,
the trustee will be required to use the degree of care of a prudent person in
the conduct of his own affairs in the exercise of its powers. Subject to these
provisions, the trustee will be under no obligation to exercise any of its
rights or powers under the indenture at the request of any holders of notes,
unless they shall have offered to the trustee reasonable security or indemnity.
24
<PAGE>
DESCRIPTION OF CAPITAL STOCK
We are authorized to issue up to 125,000,000 shares, divided into two
classes designated "common stock" and "preferred stock". Of such shares
authorized, 120,000,000 shares are designated as common stock and 5,000,000
are designated preferred stock.
Common Stock
As of December 31, 1999, there were 25,248,757 shares of common stock
outstanding that were held of record by approximately 555 stockholders.
The holders of common stock are entitled to one vote for each share held of
record on all matters submitted to a vote of the stockholders. The holders of
common stock are not entitled to cumulative voting rights with respect to the
election of directors, and as a consequence, minority stockholders will not be
able to elect directors on the basis of their votes alone. Subject to
preferences that may be applicable to any then outstanding shares of preferred
stock, holders of common stock are entitled to receive ratably such dividends as
may be declared by our Board of Directors out of funds legally available
therefor. We have never declared or paid any cash dividends on our common stock.
We currently intend to retain earnings, if any, to support the development of
our business and do not anticipate paying cash dividends in the foreseeable
future. Payment of future dividends, if any, will be at the discretion of our
board of directors after taking into account various factors, including our
financial condition, operating results and current and anticipate cash needs.
In the event of a liquidation, dissolution or winding up of us, holders of
the common stock are entitled to share ratably in all assets remaining after
payment of liabilities and the liquidation preference of any then outstanding
preferred stock. Holders of common stock have no preemptive rights and no right
to convert their common stock into any other securities. There are no redemption
or sinking fund provisions applicable to the common stock.
Preferred Stock
Pursuant to our Certificate of Incorporation, our Board of Directors has
the authority, without further action by the stockholders, to issue up to
5,000,000 shares of preferred stock in one or more series and to fix the rights,
preferences, privileges and restrictions thereof, including dividend rights,
conversion rights, voting rights, terms of redemption, liquidation preferences,
sinking fund terms and the number of shares constituting any series or the
designation of such series, without any further vote or action by stockholders.
The issuance of preferred stock could adversely affect the voting power of
holders of common stock and the likelihood that such holders will receive
dividend payments and payments upon liquidation and could have the effect of
delaying, deferring or preventing a change in control of us. We have no present
plan to issue any shares of preferred stock.
Anti-Takeover Effects Of Charter Provisions
Our Board of Directors has the authority to issue up to 5,000,000 shares of
preferred stock and to determine the price, rights, preferences and privileges
of those shares without any further vote or action by our stockholders. The
rights of the holders of common stock will be subject to and may be adversely
affected by, the rights of the holders of any preferred stock that may be issued
in the future. While we have no present intention to issue shares of preferred
stock, such issuance, while providing desirable flexibility in connection with
possible acquisitions and other corporate purposes, could have the effect of
making it more difficult for a third party to acquire a majority of our
outstanding voting stock.
Our Board of Directors adopted a Preferred Share Purchase Rights Plan,
commonly referred to as a "poison pill." In addition, our Certificate of
Incorporation does not permit cumulative voting. The Certificate of
Incorporation also includes a "Fair Price Provision" that requires the approval
of the holders of 66 2/3% of our voting stock as a condition to a merger or
certain other business transactions with or proposed by, a holder of 15% or more
of our voting stock, except where disinterested board or stockholder approval is
obtained or certain minimum price criteria and other procedural requirements are
met. These provisions and other provisions of our Certificate of Incorporation,
our bylaws and Delaware corporate law, may have the effect of deterring hostile
takeovers or delaying or preventing changes in our control or management,
including transactions in which stockholders might otherwise receive a premium
for their shares over then current market prices.
25
<PAGE>
Rights Plan
In January 1995, our Board of Directors adopted a Preferred Share Purchase
Rights Plan, pursuant to which one preferred share was issued as a dividend for
each outstanding share of our common stock. Each Right entitles the registered
holder to purchase from COR one one-hundredth of a share of Series A junior
participating preferred stock at an initial purchase price of $90.00 per one
one-hundredth of a preferred share, subject to adjustment.
The Rights would become exercisable when a person or group acquires 20% or
more of our common stock or 10 business days after commencement or announcement
of a tender or exchange offer that would result in such ownership. After the
Rights become exercisable, the holder of each Right, other than the person or
group acquiring 20% or more of our stock, would be permitted to purchase, for
the exercise price, shares of COR common stock having a market value of twice
the exercise price. The Rights will expire on January 23, 2005, unless earlier
redeemed or exchanged by COR.
If, after the Rights become exercisable, we were to be acquired through a
merger or other business combination transaction or 50% or more of our assets or
earning power were sold, each Right would permit the holder to purchase, for the
exercise price, common stock of the acquiring company having a market value of
twice the exercise price.
Preferred shares purchasable upon exercise of the Rights will not be
redeemable. Each preferred share will be entitled to a minimum preferential
quarterly dividend payment of $1.00 but will be entitled to an aggregate
dividend of 100 times the dividend declared per share of common stock. In the
event of liquidation, the holders of the preferred shares would be entitled to a
minimum preferential liquidation payment of $100 per share, but would be
entitled to receive an aggregate payment equal to 100 times the payment made per
share of common stock. Each preferred share will have 100 votes voting together
with the common stock. Finally, in the even of any merger, consolidation or
other transaction in which shares of common stock are exchanged, each preferred
share will be entitled to receive 100 times the amount of consideration received
per share of common stock. The preferred shares rank junior to any other series
of our preferred stock.
Section 203 Of The Delaware General Corporation Law
We are subject to Section 203 or the Delaware General Corporation Law
("Section 203"), which, subject to certain exceptions, prohibits us from
engaging in any business combination with any interested stockholder for a
period of three years following the time that such stockholder became an
interested stockholder, unless: (i) prior to such time, our Board of Directors
approved either the business combination or the transaction that resulted in the
stockholder becoming an interested holder; (ii) upon consummation of the
transaction that resulted in the stockholder becoming an interested stockholder,
the interested stockholder owned at least 85% of the voting stock of the
corporation outstanding at the time the transaction commenced, excluding for
purposes of determining the number of shares outstanding those shares owned (a)
by persons who are directors and also officers and (b) by employee stock plans
in which employee participants do not have the right to determine confidentially
whether shares held subject to the plan will be tendered in a tender or exchange
offer; or (iii) at or subsequent to such time, the business combination is
approved by our Board of Directors and authorized at an annual or special
meeting of stockholders, and not by written consent, by the affirmative vote of
at least 66 2/3% of the outstanding voting stock which is not owned by the
interested stockholder.
In general, Section 203 defines "business combination" to include: (i) any
merger or consolidation involving the corporation and the interested
stockholder, (ii) any sale, transfer, pledge or other disposition of 10% or more
of the assets of the corporation involving the interested stockholder, (iii)
subject to certain exceptions, any transaction that results in the issuance or
transfer by the corporation of any stock of the corporation to the interested
stockholder, (iv) any transaction involving the corporation that has the effect
of increasing the proportionate share of the stock or any class or series of the
corporation beneficially owned by the interested stockholder or (v) the receipt
by the interested stockholder of the benefit of any loans, advances, guarantees,
pledges or other financial benefits by or through the corporation. In general,
Section 203 defines "interested stockholder" as an entity or person beneficially
owning 15% or more of the outstanding voting stock of the corporation and any
entity or person affiliated with or controlling or controlled by such entity or
person.
26
<PAGE>
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
The following is a general discussion of certain U.S. federal income tax
consequences to holders of the notes or underlying common stock. This discussion
is based upon the Internal Revenue Code of 1986, as amended (the "Code"),
existing and proposed U.S. Treasury Regulations ("Regulations"), Internal
Revenue Service ("IRS") rulings and pronouncements, and judicial decisions now
in effect, all of which are subject to change (possibly with retroactive effect)
or different interpretation.
This discussion is for general information only and does not address all
aspects of U.S. federal income taxation that may be relevant to holders of the
notes or common stock. This discussion does not describe the tax consequences
arising under the laws of any foreign, state or local jurisdiction, nor does it
describe all of the tax consequences that may be relevant to particular holders
in light of their personal circumstances (such as holders subject to the U.S.
federal alternative minimum tax), or to certain types of holders (such as
certain financial institutions, insurance companies, tax-exempt entities,
dealers in securities or foreign currencies, persons who hold the notes or
common stock in connection with a "straddle", "hedging", "conversion" or other
risk reduction transaction for U.S. federal income tax purposes, or persons that
have a "functional currency" other than the U.S. dollar) who may be subject to
special rules. This discussion assumes that each holder has acquired the notes
on their original issuance at their original offering price and holds the notes
and common stock received upon conversion thereof as capital assets within the
meaning of Section 1221 of the Code. In addition, this discussion is limited to
tax considerations applicable to the initial purchasers of the notes who
purchase the notes pursuant to this offering and does not discuss the tax
considerations applicable to subsequent purchasers of the notes. COR has not
sought any ruling from the IRS with respect to statements made and the
conclusions reached in this discussion and there can be no assurance that the
IRS will agree with such statements and conclusions.
For purposes of this discussion, the term "U.S. Holder" means a holder who
or that (i) is a citizen or resident of the United States, (ii) is a
corporation, partnership or other entity (other than a trust) created or
organized in or under the laws of the United States or a political subdivision
thereof, (iii) is an estate the income of which is subject to U.S. federal
income taxation regardless of its source, (iv) is a trust if (A) a U.S. court is
able to exercise primary supervision over the administration of the trust and
(B) one or more U.S. persons, within the meaning of Section 7701(a)(30) of the
Code ("U.S. Persons"), have authority to control all substantial decisions of
the trust, or (v) is otherwise subject to U.S. federal income taxation on a net
income basis in respect of the notes or common stock. As used herein, a "Non-
U.S. Holder" means a holder who or that is not a U.S. Holder.
PROSPECTIVE PURCHASERS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS
REGARDING THE FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF THEIR
PARTICIPATION IN THIS OFFERING, AND THEIR OWNERSHIP AND DISPOSITION OF THE NOTES
(INCLUDING CONVERSION OF THE NOTES) OR COMMON STOCK, INCLUDING THE EFFECT THAT
THEIR PARTICULAR CIRCUMSTANCES MAY HAVE ON SUCH TAX CONSEQUENCES.
U.S. Holders
Interest on Notes. Interest paid on a note will be taxable to a U.S. Holder
as ordinary interest income, at the time that such interest is accrued or
actually or constructively received, in accordance with such U.S. Holder's
method of accounting for U.S. federal income tax purposes.
Liquidated Damages. The interest rate on the notes is subject to increase
if the notes are not registered with the Commission within prescribed time
periods. See "Description of the Notes -- Registration Rights". However, under
applicable Treasury Regulations, the possibility of an additional payment on the
notes may be disregarded for the purposes of determining the amount of interest
on the notes if on the date the notes are issued the possibility of such a
payment is incidental or remote. COR intends to treat the possibility that the
notes will not be registered within the prescribed time periods as a remote or
incidental contingency, and therefore, COR believes that any additional interest
resulting from a failure to register the notes will be taxable to U.S. Holders
at the time it accrues or is received in accordance with each such holder's
method of accounting.
Our determination that there is a remote likelihood of paying additional
interest on the notes is binding on each U.S. Holder unless the holder
explicitly discloses in the manner required by applicable Treasury Regulations
that its determination is different from our determination. Our determination is
not, however, binding on the IRS.
Conversion of Notes. A U.S. Holder of a note generally will not recognize
income, gain or loss on the conversion of the note into common stock, including
an optional conversion by COR in the case of a repurchase upon a change in
control, except upon receipt of
27
<PAGE>
cash in lieu of a fractional share of common stock or attributable to accrued
but unpaid interest that would be taxable as interest income. Such U.S. Holder's
aggregate tax basis in the common stock received upon conversion of the note
will be equal to the U.S. Holder's adjusted tax basis in the note at the time of
conversion (less any portion of that basis allocable to cash received in lieu of
a fractional share). The holding period of the common stock received upon
conversion of a note generally will include the period during which the U.S.
Holder held such note prior to the conversion.
Cash received in lieu of a fractional share of common stock should be
treated as a payment in exchange for such fractional share. Gain or loss
recognized on the receipt of cash paid in lieu of such fractional share
generally will be capital gain or loss equal to the difference between the
amount of cash received and the amount of adjusted tax basis allocable to the
fractional share.
Adjustment of Conversion Price. The conversion price of the notes is
subject to adjustment in certain circumstances. See "Description of the Notes --
Conversion Rights". Under Section 305(c) of the Code, and the Treasury
Regulations issued thereunder, adjustments that have the effect of increasing or
decreasing the proportionate interest of U.S. Holders of the notes in assets or
earnings of COR (for example, an adjustment following a distribution of property
by COR to its stockholders) may in some circumstances give rise to deemed
distributions to U.S. Holders; similarly, a failure to adjust the conversion
price of the notes to reflect a stock dividend or other event increasing the
proportionate interest of stockholders of outstanding common stock can in some
circumstances give rise to deemed distributions to such stockholders. Such
deemed distributions will be taxable as a dividend, return of capital or capital
gain in accordance with the earnings and profits rules discussed under "--
Distributions on Common Stock" below whether or not the U.S. Holders ever
convert such notes. Generally, a U.S. Holder's tax basis in a note will be
increased to the extent any such constructive distribution is treated as a
dividend.
Distributions on Common Stock. Distributions on common stock will
constitute a dividend for U.S. federal income tax purposes to the extent of our
current or accumulated earnings and profits as determined under U.S. federal
income tax principles. Dividends paid to U.S. Holders that are U.S. corporations
may qualify for the dividends-received deduction. Noncorporate taxpayers and
certain corporations are not entitled to the dividends-received deduction.
To the extent, if any, that a U.S. Holder receives a distribution on common
stock that would otherwise constitute a dividend for U.S. federal income tax
purposes but that exceeds our current and accumulated earnings and profits, such
distribution will be treated first as a nontaxable return of capital reducing
the U.S. Holder's tax basis in the common stock. Any such distributions in
excess of the U.S. Holder's tax basis in the common stock will be treated as
capital gain.
Sale, Exchange or Redemption of Notes or Common Stock. In general, subject
to the discussion in the section entitled "Market Discount" below, a U.S. Holder
of a note will recognize capital gain or loss upon the sale, redemption,
retirement or other disposition of the note measured by the difference between
the amount of cash and the fair market value of any property received (except to
the extent attributable to the payment of accrued interest income, which is
taxable as ordinary income) and such U.S. Holder's adjusted tax basis in the
note. A U.S. Holder's adjusted tax basis in the note generally will equal the
cost of the note to such holder, increased by the amount of any market discount
previously taken into income by the holder or decreased by any premium amortized
by the holder with respect to the note. (For the basis and holding period of
shares of common stock received upon conversion of the note, see "-- Conversion
of Notes", above.) In general, subject to the discussion under "Market Discount"
below, a U.S. Holder of common stock received upon conversion of a note will
recognize capital gain or loss upon the sale, exchange, redemption or other
disposition of the common stock under rules similar to the computation of gain
or loss on the disposition of the notes. However, special rules may apply to a
redemption of common stock which may result in the proceeds of the redemption
being treated as a dividend. In general, the maximum tax rate for noncorporate
taxpayers on long-term capital gain is 20% with respect to capital assets
(including the notes and common stock), but only if they have been held for more
than one year at the time of disposition. Capital gain on assets having a
holding period of one year or less at the time of disposition of the assets is
taxed as "short-term gain" at a maximum rate of 39.6% in the hands of
noncorporate taxpayers. For individual taxpayers, the deductibility of capital
losses is subject to limitations. For corporate taxpayers, capital gains or
ordinary income are subject to a maximum regular tax rate of 35%.
Market Discount. The resale of notes may be affected by the impact on a
purchaser of the "market discount" provisions of the Code. For this purpose,
the market discount on a note generally will be equal to the amount, if any, by
which the stated redemption price at maturity of the note immediately after its
acquisition (other than at original issue) exceeds the U.S. Holder's adjusted
tax basis in the note. Subject to a de minimis exception, these provisions
generally require a U.S. Holder who acquires a note at a market discount to
treat as ordinary income any gain recognized on the disposition of such note to
the extent of the "accrued market discount" on such note at the time of
disposition, unless the U.S. Holder elects to include accrued market discount
in income currently. This election to include market discount in income
currently, once made, applies to all market discount obligations acquired on or
after the
28
<PAGE>
first taxable year to which the election applies and may not be revoked without
the consent of the IRS. In general, market discount will be treated as accruing
on a straight-line basis over the remaining term of the note at the time of
acquisition, or, at the election of the U.S. Holder, under a constant yield
method. A U.S. Holder who acquires a note at a market discount and who does not
elect to include accrued market discount in income currently may be required to
defer the deduction of a portion of the interest on any indebtedness incurred or
maintained to purchase or carry the note until the note is disposed of in a
taxable transaction. If a U.S. Holder acquires a note with market discount and
receives common stock upon conversion of the note, the amount of accrued market
discount not previously included in income with respect to the converted note
through the date of conversion will be treated as ordinary income upon the
disposition of the common stock.
Amortizable Premium. A U.S. Holder who purchases a note at a premium over
its stated principal amount, plus accrued interest, generally may elect to
amortize such premium ("Section 171 premium") from the purchase date to the
note's maturity date under a constant-yield method that reflects semiannual
compounding based on the note's payment period. Amortizable premium, however,
will not include any premium attributable to a note's conversion feature. The
premium attributable to the conversion feature is the excess, if any, of the
note's purchase price over what the note's fair market value would be if there
were no conversion feature. Amortized Section 171 premium is treated as an
offset to interest income on a note and not as a separate deduction. The
election to amortize premium on a constant yield method, once made, applies to
all debt obligations held or subsequently acquired by the electing U.S. Holder
on or after the first day of the first taxable year to which the election
applies and may not be revoked without the consent of the IRS.
Non-U.S. Holders
Payments of Interest. Generally, payments of interest (including, for this
purpose, any Liquidated Damages) on the notes to, or on behalf of, a Non-U.S.
Holder will not be subject to U.S. federal withholding tax where such interest
is not effectively connected with the conduct of a trade or business within the
U.S. by such Non-U.S. Holder if: (i) such Non-U.S. Holder does not actually or
constructively own 10% or more of the total combined voting power of all classes
of our stock within the meaning of Code Section 871(h)(3); (ii) such Non-U.S.
Holder is not (a) a controlled foreign corporation for U.S. federal income tax
purposes that is related to us through stock ownership or (b) a bank that
received the note on an extension of credit made pursuant to a loan agreement
entered into in the ordinary course of its trade or business as described in
Section 881(c)(3)(A) of the Code; and (iii) the Non-U.S. Holder provides a
statement signed under penalties of perjury that includes its name and address
and certifies that it is not a U.S. Person in compliance with applicable
requirements of the Regulations or an exemption is otherwise established. If
certain requirements are satisfied, the certification described above may be
provided by a securities clearing organization, a bank, or other financial
institution that holds customer's securities in the ordinary course of its trade
or business. For this purpose the Non-U.S. Holder of notes would be deemed to
own constructively the common stock into which it could be converted. If these
requirements cannot be satisfied, a Non-U.S. Holder will be subject to U.S.
federal withholding tax at a rate of 30% (or lower treaty rate, if applicable)
on interest payments on the notes unless (x) the interest is effectively
connected with the conduct of a United States trade or business, in which case
the interest will be subject to U.S. federal income tax on net income that
applies to U.S. persons generally, or (y) an applicable income tax treaty
provides for a lower rate of, or exemption from, withholding tax.
Conversion of Notes. A Non-U.S. Holder generally will not be subject to
U.S. federal withholding tax on the conversion of a note into common stock. To
the extent a Non-U.S. Holder receives cash in lieu of a fractional share of
common stock on the conversion, such cash may give rise to gain that would be
subject to the rules described below with respect to the sale or exchange of a
note or common stock. See "-- Sales or Exchange of Notes or Common Stock" below.
Adjustment of Conversion Price. The conversion price of the notes is
subject to adjustment in certain circumstances. See "Description of the Notes --
Conversion Rights". Any such adjustment could, in certain circumstances, give
rise to a deemed distribution to Non-U.S. Holders of the notes. See "-- U.S.
Holders -- Adjustment of Conversion Price" above. In such case, the deemed
distribution would be subject to the rules below regarding withholding of U.S.
federal tax on dividends in respect of common stock. See "-- Distributions on
Common Stock" below.
Distributions on Common Stock. Distributions on common stock will
constitute a dividend for U.S. federal income tax purposes to the extent of our
current or accumulated earnings and profits as determined under U.S. federal
income tax principles. Dividends paid on common stock held by a Non-U.S. Holder
will be subject to U.S. federal withholding tax at a rate of 30% (or lower
treaty rate, if applicable), unless the dividend is effectively connected with
the conduct of a trade or business within the United States by the Non-U.S.
Holder and, if required by a tax treaty, is attributable to a permanent
establishment maintained in the United States, in which case the dividend will
be subject to U.S. federal income tax on net income that applies to U.S. persons
generally (and, with respect to
29
<PAGE>
corporate holders under certain circumstances, the branch profits tax). A Non-
U.S. Holder may be required to satisfy certain certification requirements in
order to claim a reduction of or exemption from withholding under the foregoing
rules.
Sales or Exchange of Notes or Common Stock. In general, a Non-U.S. Holder
generally will not be subject to U.S. federal withholding tax on gain recognized
upon the sale or other disposition (including a redemption) of a note or common
stock received upon conversion thereof unless the gain is effectively connected
with the conduct of a trade or business within the U.S. by the Non-Holder and,
if required by a tax treaty, is attributable to a permanent establishment
maintained in the United States or unless, the Non-U.S. Holder (i) is a
nonresident alien individual who is present in the United States for 183 or more
days in the taxable year in which the gain is realized and certain other
conditions are satisfied, or (ii) is subject to tax pursuant to the provisions
of U.S. tax law applicable to certain U.S. expatriates. However, if the Company
were to become a "United States real property holding corporation" (a "USRPHC"),
a Non-U.S. Holder may be subject to federal income tax withholding with respect
to gain realized on the disposition of notes or shares of common stock. In that
case, any withholding tax withheld pursuant to the rules applicable to
dispositions of a "United States real property interest" will be creditable
against such Non-U.S. Holder's U.S. federal income tax liability and may entitle
such Non-U.S. Holder to a refund upon furnishing required information to the
IRS. We do not believe that we are a USRPHC or will become a USRPHC in the
future.
U.S. Estate Tax. Notes owned or treated as owned by an individual who is
not a citizen or resident (as specially defined for U.S. federal estate tax
purposes) of the United States at the time of death ("Nonresident Decedent")
will not be includible in the Nonresident Decedent's gross estate for U.S.
federal estate tax purposes as a result of the Nonresident Decedent's death,
provided that, at the time of death, the Nonresident Decedent does not own,
actually or constructively, 10% or more of the total combined voting power of
all classes of our stock and payments with respect to such notes would not have
been effectively connected with the conduct of a trade or business in the United
States by the Nonresident Decedent. Common stock owned or treated as owned by a
Nonresident Decedent will be includible in the Nonresident Decedent's gross
estate for U.S. federal estate tax purposes as a result of the Nonresident
Decedent's death. Subject to applicable treaty limitations, if any, a
Nonresident Decedent's estate may be subject to U.S. federal estate tax on
property includible in the estate for U.S. federal estate tax purposes.
IRS Reporting and Backup Withholding
Certain noncorporate U.S. Holders may be subject to IRS reporting and
backup withholding at a rate of 31% on payments of interest on the notes,
dividends on common stock and proceeds from the sale or other disposition of the
notes or common stock. Backup withholding will only be imposed where the
noncorporate U.S. Holder (i) fails to furnish its taxpayer identification number
("TIN"), which would ordinarily be his or her social security number, on a
properly completed Form W-9; (ii) furnishes an incorrect TIN, (iii) is notified
by the IRS that he or she has failed to properly report payments of interests or
dividends, or (iv) under certain circumstances, fails to certify, under
penalties of perjury, that he or she has furnished a correct TIN and has not
been notified by the IRS that he or she is subject to backup withholding. A
failure to provide us with a correct TIN may also subject a U.S. Holder to
penalties imposed by the IRS.
We must report annually to the IRS and to each Non-U.S. Holder any interest
and dividends paid with respect to a note or common stock, respectively, and
that is subject to U.S. federal withholding tax or that is exempt from such tax
under applicable treaty or the Code. We also report to the IRS and to each non-
U.S. Person such income paid which is exempt from federal withholding tax
because it is effectively connected with such Non-U.S. Person's U.S. trade or
business. However, a Non-U.S. Holder will not be subject to IRS reporting or
backup withholding if the payor has received appropriate certification
statements from or on behalf of the Non-U.S. Holder and provided that the payor
does not have actual knowledge that the Non-U.S. Holder is a U.S. Person. The
payment of the proceeds from the disposition of the notes or common stock to or
through the U.S. office of any U.S. or foreign broker will be subject to IRS
reporting and possibly backup withholding unless the owner certifies as to its
non-U.S. status under penalties of perjury or otherwise establishes an
exemption, provided that the broker does not have actual knowledge that the
holder is a U.S. Person or that the conditions of any other exemption are not,
in fact, satisfied. The payment of the proceeds from the disposition of a note
or common stock to or through a non-U.S. office of a non-U.S. broker that is not
a U.S. related person will not be subject to IRS reporting or backup
withholding. For this purpose, a "U.S. related person" is (i) a "controlled
foreign corporation" for U.S. federal income tax purposes or (ii) a non-U.S.
Person 50% or more of whose gross income from all sources for the three-year
period ending with the close of its taxable year preceding the payment (or for
such part of the period that the broker has been in existence) is derived from
the activities that are effectively connected with the conduct of a U.S. trade
or business.
In the case of the payment of proceeds from the disposition of notes or
common stock to or through a non-U.S. office of a broker that is a U.S. related
person, the Regulations require IRS reporting on the payment unless the broker
has documentary evidence in its
30
<PAGE>
files that the owner is a Non-U.S. Holder and the broker has no knowledge to the
contrary. Backup withholding will not apply to payments made through foreign
offices of a broker that is a U.S. Person or a U.S. related person (absent
actual knowledge that the payee is a U.S. Person).
Any amounts withheld under the backup withholding rates from a payment to a
holder will be allowed as a credit against such holder's U.S. federal income
tax liability, if any, or will otherwise be refundable, provided that the
requisite procedures are followed. Holders of the notes or common stock should
consult their own tax advisors regarding their qualification for exemption from
backup withholding and the procedure for obtaining such an exemption, if
applicable.
Prospective Final Regulations
The IRS has issued new withholding regulations effective generally for
payments made after December 31, 2000. The Proposed Regulations provide that
information reporting but not backup withholding, may apply to a payment made
outside the United States of the proceeds of a sale of a note through an office
outside the United States of a broker that is a foreign partnership if one or
more of its partners are "U.S. persons", as defined in U.S. Treasury
regulations, who in the aggregate hold more than 50% of the income or capital
interest in the partnership or such foreign partnership is engaged in a United
States trade or business unless the broker has documentary evidence in its
records that the holder is a non-U.S. person and does not have actual knowledge
that the holder is a U.S. person, or the holder otherwise establishes an
exemption. Non-U.S. Holders should consult their own tax advisors with respect
to the future impact of these new withholding regulations.
31
<PAGE>
SELLING SECURITY HOLDERS
The notes were originally issued by us to the initial purchasers in a
transaction exempt from the registration requirements of the Securities Act, and
immediately resold by the initial purchasers to persons reasonably believed by
the initial purchasers to be qualified institutional buyers. Selling holders,
including their transferees, pledgees or donees or their successors, may from
time to time offer and sell pursuant to this prospectus any or all of the notes
and common stock into which the notes are convertible.
The following table sets forth information, as of April 25, 2000, with respect
to the selling holders and the principal amounts of notes beneficially owned by
each selling holder that may be offered under this prospectus. The information
is based on information provided by or on behalf of the selling holders. The
selling holders may offer all, some or none of the notes or common stock into
which the notes are convertible. Because the selling holders may offer all or
some portion of the notes or the common stock, no estimate can be given as to
the amount of the notes or the common stock that will be held by the selling
holders upon termination of any sales. In addition, the selling holders
identified below may have sold, transferred or otherwise disposed of all or a
portion of their notes since the date on which they provided the information
regarding their notes in transactions exempt from the registration requirements
of the Securities Act.
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT
OF NOTES SHARES OF
BENEFICIALLY COMMON STOCK
OWNED AND BENEFICIALLY
NAME OFFERED OWNED(1)
- ------------------------------------------------------ ------- --------------
<S> <C> <C>
1976 Distribution Trust FBO Jane A. Lauder 9,000 133
1976 Distribution Trust FBO A.R. Lauder/Zinterhofer 9,000 133
AIG/National Union Fire Insurance 1,330,000 19,968
AIG SoundShore Holdings Ltd. 1,500,000 22,204
Allstate Insurance Company 1,470,000 21,760(2)
Aloha Airlines Pilots Retirement Trust 75,000 1,110
Aloha Airlines Non-Pilots Pension Trust 130,000 1,924
Bear Stearns & Co., Inc. 1,750,000 25,904
Castle Convertible Fund, Inc. 500,000 7,401
C&H Sugar Company, Inc. 205,000 3,034
Chrysler Corporation Master Retirement Trust 1,520,000 22,500
City University of New York 46,000 680
Conseco Fund Group Convertible Securities Fund 1,000,000 14,802
Employee Benefit Convertible Securities Fund 110,000 1,628
Georges et/ou Maya Andraos 100,000 1,480
Grace Brothers, LTD 1,500,000 22,204
Grady Hospital Foundation 69,000 1,021
Hawaiian Airlines Employees Pension Plan - IAM 110,000 1,628
Hawaiian Airlines Pension Plan for Salaried Employees 30,000 444
Hawaiian Airlines Pilots Retirement Trust 180,000 2,664
Independence Blue Cross 65,000 962
Island Holdings 75,000 1,110
Jefferies & Company 500,000 7,401
LDG Limited 125,000 1,850
Lipper Convertibles, L.P. 5,400,000 79,935
Lipper Offshore Convertibles, L.P. 500,000 7,401
Local Initiatives Union 28,000 414
Motion Picture Industry Health Plan - Active 290,000 4,292
Member Fund
Motion Picture Industry Health Plan - Retiree 145,000 2,146
Member Fund
Nalco Chemical Company 525,000 7,771
Nations Convertible Securities Fund 1,890,000 27,977
New Orleans Firefighters Pension/Relief Fund 71,000 1,050
New York Life Insurance Company 13,550,000 200,577
Occidental Petroleum Corporation 122,000 1,805
OCM Convertible Trust 1,355,000 20,057
Partner Reinsurance Company, Ltd. 405,000 5,995
Queen's Health Plan 45,000 666
R/2/ Investments, LDC 4,550,000 67,352
<CAPTION>
NOTES OWNED COMMON STOCK
AFTER OWNED AFTER
COMMON STOCK COMPLETION COMPLETION OF
NAME OFFERED OF OFFERING OFFERING
- ------------------------------------------------------ ------- ------------ ---------
<S> <C> <C>
1976 Distribution Trust FBO Jane A. Lauder 133 0 0
1976 Distribution Trust FBO A.R. Lauder/Zinterhofer 133 0 0
AIG/National Union Fire Insurance 19,968 0 0
AIG SoundShore Holdings Ltd. 22,204 0 0
Allstate Insurance Company 13,560 0 8,200
Aloha Airlines Pilots Retirement Trust 1,110 0 0
Aloha Airlines Non-Pilots Pension Trust 1,924 0 0
Bear Stearns & Co., Inc. 25,904 0 0
Castle Convertible Fund, Inc. 7,401 0 0
C&H Sugar Company, Inc. 3,034 0 0
Chrysler Corporation Master Retirement Trust 22,500 0 0
City University of New York 680 0 0
Conseco Fund Group Convertible Securities Fund 14,802 0 0
Employee Benefit Convertible Securities Fund 1,628 0 0
Georges et/ou Maya Andraos 1,480 0 0
Grace Brothers, LTD 22,204 0 0
Grady Hospital Foundation 1,021 0 0
Hawaiian Airlines Employees Pension Plan - IAM 1,628 0 0
Hawaiian Airlines Pension Plan for Salaried Employees 444 0 0
Hawaiian Airlines Pilots Retirement Trust 2,664 0 0
Independence Blue Cross 962 0 0
Island Holdings 1,110 0 0
Jefferies & Company 7,401 0 0
LDG Limited 1,850 0 0
Lipper Convertibles, L.P. 79,935 0 0
Lipper Offshore Convertibles, L.P. 7,401 0 0
Local Initiatives Union 414 0 0
Motion Picture Industry Health Plan - Active 4,292 0 0
Member Fund
Motion Picture Industry Health Plan - Retiree 2,146 0 0
Member Fund
Nalco Chemical Company 7,771 0 0
Nations Convertible Securities Fund 27,977 0 0
New Orleans Firefighters Pension/Relief Fund 1,050 0 0
New York Life Insurance Company 200,577 0 0
Occidental Petroleum Corporation 1,805 0 0
OCM Convertible Trust 20,057 0 0
Partner Reinsurance Company, Ltd. 5,995 0 0
Queen's Health Plan 666 0 0
R/2/ Investments, LDC 67,352 0 0
</TABLE>
(1) Unless otherwise noted, represents shares of common stock issuable upon
conversion of notes.
(2) Includes 4,100 shares held by Allstate Insurance Company, 500 shares held by
Allstate Life Insurance Company, 900 shares held by Agents Pension Plan and
2,700 shares held by Allstate Retirement Plan.
32
<PAGE>
<TABLE>
<S> <C> <C> <C> <C>
Salomon Smith Barney Inc. 1,765,000 26,126 26,126 0
Shell Pension Trust 198,000 2,930 2,930 0
Southern Farm Bureau Life Insurance - FRIC 650,000 9,621 9,621 0
State of Connecticut Combined Investment Funds 2,965,000 43,890 43,890 0
State of Maryland Retirement System 1,285,000 19,021 19,021 0
Tribeca Investment L.L.C 5,300,000 78,454 78,454 0
TQA Master Fund, Ltd. 1,400,000 20,723 20,723 0
TQA Master Plus Fund, Ltd. 400,000 5,921 5,921 0
Vanguard Convertible Securities Fund, Inc. 3,320,000 49,145 49,145
White River Securities LLC 1,750,000 25,904 25,904 0
Zurich HFR Mstr Hdg Fund 75,000 1,110 1,110 0
</TABLE>
33
<PAGE>
PLAN OF DISTRIBUTION
The selling holders and their successors, including their transferees, pledgees
or donees or their successors, may sell the notes and the common stock into
which the notes are convertible directly to purchasers or through underwriters,
broker-dealers or agents, who may receive compensation in the form of discounts,
concessions or commissions from the selling holders or the purchasers. These
discounts, concessions or commissions as to any particular underwriter, broker-
dealer or agent may be in excess of those customary in the types of transactions
involved.
The notes and the common stock into which the notes are convertible may be sold
in one or more transactions at fixed prices, at prevailing market prices at the
time of sale, at prices related to the prevailing market prices, at varying
prices determined at the time of sale, or at negotiated prices. These sales may
be effected in transactions, which may involve crosses or block transactions:
. on any national securities exchange or U.S. inter-dealer system of a
registered national securities association on which the notes or the
common stock may be listed or quoted at the time of sale;
. in the over-the-counter market;
. in transactions otherwise than on these exchanges or systems or in the
over-the-counter market;
. through the writing of options, whether the options are listed on an
options exchange or otherwise; or
. through the settlement of short sales.
In connection with the sale of the notes and the common stock into which the
notes are convertible or otherwise, the selling holders may enter into hedging
transactions with broker-dealers or other financial institutions, which may in
turn engage in short sales of the notes or the common stock into which the notes
are convertible in the course of hedging the positions they assume. The selling
holders may also sell the notes or the common stock into which the notes are
convertible short and deliver these securities to close out their short
positions, or loan or pledge the notes or the common stock into which the notes
are convertible to broker-dealers that in turn may sell these securities.
The aggregate proceeds to the selling holders from the sale of the notes or
common stock into which the notes are convertible offered by them will be the
purchase price of the notes or common stock less discounts and commissions, if
any. Each of the selling holders reserves the right to accept and, together
with their agents from time to time, to reject, in whole or in part, any
proposed purchase of notes or common stock to be made directly or through
agents. We will not receive any of the proceeds from this offering.
In order to comply with the securities laws of some states, if applicable, the
notes and common stock into which the notes are convertible may be sold in these
jurisdictions only through registered or licensed brokers or dealers. In
addition, in some states the notes and common stock into which the notes are
convertible may not be sold unless they have been registered or qualified for
sale or an exemption from registration or qualification requirements is
available and is complied with.
The selling holders and any underwriters, broker-dealers or agents that
participate in the sale of the notes and common stock into which the notes are
convertible may be "underwriters" within the meaning of Section 2(11) of the
Securities Act. Any discounts, commissions, concessions or profit they earn on
any resale of the shares may be underwriting discounts and commissions under the
Securities Act. Selling holders who are "underwriters" within the meaning of
Section 2(11) of the Securities Act will be subject to the prospectus delivery
requirements of the Securities Act. The selling holders have acknowledged that
they understand their obligations to comply with the provisions of the Exchange
Act and the rules thereunder relating to stock manipulation, particularly
Regulation M.
In addition, any securities covered by this prospectus that qualify for sale
pursuant to Rule 144 or Rule 144A of the Securities Act may be sold under Rule
144 or Rule 144A rather than pursuant to this prospectus. A selling holder may
not sell any notes or common stock described in this prospectus and may not
transfer, devise or gift these securities by other means not described in this
prospectus.
To the extent required, the specific notes or common stock to be sold, the names
of the selling holders, the respective purchase prices and public offering
prices, the names of any agent, dealer or underwriter, and any applicable
commissions or discounts with respect to
34
<PAGE>
a particular offer will be set forth in an accompanying prospectus supplement
or, if appropriate, a post- effective amendment to the registration statement of
which this prospectus is a part.
We entered into a registration rights agreement for the benefit of holders of
the notes to register their notes and common stock under applicable federal and
state securities laws under specific circumstances and at specific times. The
registration rights agreement provides for cross-indemnification of the selling
holders and us and their and our respective directors, officers and controlling
persons against specific liabilities in connection with the offer and sale of
the notes and the common stock, including liabilities under the Securities Act.
We will pay substantially all of the expenses incurred by the selling holders
incident to the offering and sale of the notes and the common stock.
35
<PAGE>
LEGAL MATTERS
The validity of the securities offered hereby will be passed upon for COR
by Cooley Godward LLP, Palo Alto, California.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our financial
statements included in our Annual report on Form 10-K for the year ended
December 31, 1999, as set forth in their report, which is incorporated by
reference in this prospectus and elsewhere in the registration statement. Our
financial statements are incorporated by reference in reliance on Ernst & Young
LLP's report, given on their authority as experts in accounting and auditing.
36
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth all expenses, other than the underwriting
discounts and commissions, payable by the Registrant in connection with the sale
of the securities being registered. All the amounts shown are estimates except
for the registration fee and the filing fee.
<TABLE>
<S> <C>
Registration fee............................................... $ 79,200
Legal fees and expenses........................................ $100,000
Accounting fees and expenses................................... $ 50,000
Nasdaq National Market filing fee.............................. $ 17,500
Miscellaneous.................................................. $ 53,300
Total.......................................................... $300,000
========
</TABLE>
Item 15. Indemnification of Officers and Directors.
Under Section 145 of the Delaware General Corporation Law, the Registrant has
broad powers to indemnify our directors and officers against liabilities they
may incur in such capacities, including liabilities under the Securities Act of
1933, as amended (the "Securities Act").
The Registrant's Certificate of Incorporation, as amended, provides for the
elimination of liability for monetary damages for breach of the directors'
fiduciary duty of care to the Registrant and its stockholders. These provisions
do not eliminate the directors' duty of care and, in appropriate circumstances,
equitable remedies such an injunctive or other forms of non- monetary relief
will remain available under Delaware law. In addition, each director will
continue to be subject to liability for breach of the director's duty of loyalty
to the Registrant, for acts or omissions not in good faith or involving
intentional misconduct, for knowing violations of law, for any transaction from
which the director derived an improper personal benefit and for payment of
dividends or approval of stock repurchases or redemptions that are unlawful
under Delaware law. The provision does not affect a director's responsibilities
under any other laws, such as the federal securities laws or state or federal
environmental laws.
The Registrant has entered into agreements with its directors and executive
officers that require the Registrant to indemnify such persons against expenses,
judgments, fines, settlements and other amounts actually and reasonably incurred
(including expenses of a derivative action) in connection with any proceeding,
whether actual or threatened, to which any such person may be made a party by
reason of the fact that such person is or was a director or officer of the
Registrant or any of its affiliated enterprises, provided such person acted in
good faith and in a manner such person reasonably believed to be in or not
opposed to the best interests of the Registrant and, with respect to any
criminal proceeding, had no reasonable cause to believe his or her conduct was
unlawful. The indemnification agreements also set forth certain procedures that
will apply in the event of a claim for indemnification thereunder.
Item 16. Exhibits
(a) Exhibits.
Number Exhibit
-------- -------------------------------------------------------
4.1 (1) Indenture between the Registrant, as Issuer, and
Firstar Bank, N.A., as Trustee, dated February 24,
2000.
5.1 Opinion of Cooley Godward LLP.
10.1 (1) Purchase Agreement among the Registrant and Goldman,
Sachs & Co., Chase H&Q, a division of Chase Securities
Inc., CIBC World Markets Corp., FleetBoston Robertson
Stephens Inc. and Warburg Dillon Read LLC, dated
February 17, 2000.
10.2 (1) Registration Rights Agreement among the Registrant and
Goldman, Sachs & Co., Chase H&Q, a division of Chase
Securities Inc., CIBC World Markets Corp., FleetBoston
Robertson Stephens Inc. and Warburg Dillon Read LLC,
dated February 24, 2000.
II-1
<PAGE>
Number Exhibit
-------- -------------------------------------------------------
12.1 Computation of Ratio of Earnings to Fixed Charges
23.1 Consent of Cooley Godward LLP (included in Exhibit 5.1)
23.2 Consent of Ernst & Young, LLP, Independent Auditors
24.1 Power of Attorney (see page II-4)
25.1 Form T-1
(1) Filed as an exhibit to the Registrant's Quarterly Report on Form
10-Q for the period ended March 31, 2000 and incorporated by
reference herein.
Item 17. Undertakings
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
20 percent change in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the effective
registration statement.
(iii)To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if
the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed with or
furnished to the Commission by the registrant pursuant to Section 13
or 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such 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.
(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) 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 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Exchange Act) 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.
(5) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to provisions described in
Item 15, 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
II-2
<PAGE>
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-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe 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 the City of South San Francisco, County of San Mateo, State of
California, on the 24 day of May, 2000.
COR THERAPEUTICS, INC.
By /s/ Peter S. Roddy
__________________
Peter S. Roddy
Vice President, Finance
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Peter S. Roddy and Vaughn M. Kailian, and
each of them, as his true and lawful attorneys-in-fact and agents, with full
power of substitution for him, and in his name in any and all capacities, to
sign any and all amendments to this Report, and to file the same, with exhibits
thereto and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and agents, and each
of them, full power and authority to do and perform each and every act and thing
requisite and necessary to be done therewith, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, and any of them or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated:
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ Vaughn M. Kailian President, Chief Executive Officer and May 24, 2000
_________________________________________ Director (Principal Executive and Financial
Vaughn M. Kailian Officer)
/s/ Charles J. Homcy Executive Vice President, Research and May 24, 2000
_________________________________________ Development and Director
Charles J. Homcy
/s/ Peter S. Roddy Vice President, Finance (Principal Accounting May 24, 2000
_________________________________________ Officer)
Peter S. Roddy
/s/ Shaun R. Coughlin Director May 24, 2000
_________________________________________
Shaun R. Coughlin, M.D., Ph.D.
/s/ James T. Doluisio Director May 24, 2000
_________________________________________
James T. Doluisio, Ph.D.
/s/ Jerry T. Jackson Director May 24, 2000
_________________________________________
Jerry T. Jackson
/s/ Ernest Mario Director May 24, 2000
_________________________________________
Ernest Mario, Ph.D.
</TABLE>
II-4
<PAGE>
Index to Exhibits
Number Exhibit
- -------- -----------------------------------------------------------
5.1 Opinion of Cooley Godward LLP
12.1 Computation of Ratio of Earnings to Fixed Charges
23.1 Consent of Cooley Godward LLP (included in Exhibit 5.1)
23.2 Consent of Ernst & Young, LLP, Independent Auditors
24.1 Power of Attorney (see page II-4)
25.1 Form T-1
<PAGE>
EXHIBIT 5.1
[Letterhead of Cooley Godward]
May 24, 2000
COR Therapeutics, Inc.
256 East Grand Avenue
South San Francisco, California 94080
Ladies and Gentlemen:
You have requested our opinion with respect to certain matters in connection
with the filing by COR Therapeutics, Inc., a Delaware corporation (the
"Company"), of a Registration Statement on Form S-3 (the "Registration
Statement") with the Securities and Exchange Commission pursuant to which the
Company is registering under the Securities Act of 1933, as amended, the
resale by the holders thereof of a total of $300,000,000 principal amount 5%
Convertible Subordinated Notes due March 1, 2007 (the "Notes") and the shares of
Common Stock issuable upon conversion thereof (the "Shares"). The Notes were
issued pursuant to the Indenture dated February 24, 2000 between the Company and
Firststar Bank, N.A. (the "Indenture").
In connection with this opinion, we have examined copies of the Indenture, the
Notes and such other documents and have made such other inquiries and
investigations of law as we have deemed necessary or appropriate to enable us to
render the opinion expressed below. We have assumed the genuineness and
authenticity of all documents submitted to us as originals and the conformity to
originals of all documents where due execution and delivery are a prerequisite
to the effectiveness thereof. With respect to our opinion as to the
enforceability of the Notes, we have relied upon the opinion of Sullivan &
Cromwell as to matters of New York law.
Our opinion is expressed only with respect to the federal laws of the United
States of America, the General Corporation Law of the State of Delaware and the
laws of the State of California. We express no opinion as to whether the laws of
any particular jurisdiction other than those identified above are applicable to
the subject matter hereof.
On the basis of the foregoing and in reliance thereon, we are of the opinion
that (i) the Notes constitute valid and binding obligations of the Company,
except as may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer and other similar laws of general application
relating to or affecting creditors' rights, by general principals of equity, and
by an implied covenant of good faith, and (ii) the issuance upon conversion of
the Notes in accordance with their terms, the Shares will be validly issued,
fully paid and nonassessable.
We consent to the reference to our firm under the caption "Legal Matters" in the
prospectus included in the Registration Statement and to the filing of this
opinion as an exhibit to the Registration Statement.
Sincerely,
COOLEY GODWARD LLP
By: /s/ Andrea Vachss
------------------
Andrea Vachss
1.
<PAGE>
EXHIBIT 12.1
COR Therapeutics, Inc.
Computation of Ratios of Earnings to Fixed Charges
(in thousands, except ratio)
<TABLE>
<CAPTION>
Three
months
ended
Years Ended December 31, March 31,
------------------------------------------------------------------------- --------------
1995 1996 1997 1998 1999 2000
------------------------------------------------------------------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Net Income (Loss) $ (7,531) $ (36,546) $ (33,492) $ (27,614) $ (26,070) $ (9,941)
Add: Fixed Charges 1,190 1,183 1,204 1,609 1,617 1,970
----------------------------------------------------------------------- --------------
Earnings as defined $ (6,341) $ (35,363) $ (32,288) $ (26,005) $ (24,453) $ (7,971)
======================================================================= ==============
Estimated interest component of rent $ 354 $ 424 $ 580 $ 882 $ 988 $ 282
Interest expense 836 759 624 727 629 1,563
Amortization of debt issuance costs 125
----------------------------------------------------------------------- --------------
Total fixed charges $ 1,190 $ 1,183 $ 1,204 $ 1,609 $ 1,617 $ 1,970
======================================================================= =============
Ratio (1) (1) (1) (1) (1) (1)
</TABLE>
(1) Earnings (as defined) for the period were insufficient to cover fixed
charges by an amount equal to the net loss for the period.
<PAGE>
EXHIBIT 23.2
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and related Prospectus of COR Therapeutics,
Inc. for the registration of $300 million of 5% convertible subordinated notes
due March 1, 2007, and 4,440,840 shares of its common stock issuable upon
conversion of the notes, and to the incorporation by reference therein of our
report dated January 20, 2000, with respect to the financial statements of COR
Therapeutics, Inc. included in its Annual Report (Form 10-K) for the year ended
December 31, 1999, filed with the Securities and Exchange Commission.
/s/ ERNST & YOUNG LLP
Palo Alto, California
May 22, 2000
<PAGE>
EXHIBIT 25.1
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
______________________________
FORM T-1
STATEMENT OF ELIGIBILITY AND QUALIFICATION
UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION
DESIGNATED TO ACT AS TRUSTEE
______________________________
FIRSTAR BANK, N.A.
(Exact name of Trustee as specified in its charter)
A National Banking Association 41-0122055
(State of incorporation if not (IRS Employer Identification No.)
a national bank)
101 East Fifth Street
Corporate Trust Department
St. Paul, Minnesota 55101
(Address of principal executive offices) (Zip Code)
FIRSTAR BANK, N.A.
101 East Fifth Street
St. Paul, Minnesota 55101
(651) 229-2600
(Exact name, address and telephone number, including area code)
______________________________
COR THERAPEUTICS, INC.
Delaware 94-3060271
(State of incorporation (IRS Employer Identification No.)
or other jurisdiction)
256 East Grand Avenue
South San Francisco, California 94080
(Address of principal executive offices) (Zip Code)
______________________________
5% Convertible Subordinated Notes due March 1, 2007
(Title of Indenture Securities)
================================================================================
<PAGE>
Item 1. General Information. Furnish the following information as to the
-------------------
trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
Comptroller of the Currency
Treasury Department
Washington, DC
Federal Deposit Insurance Corporation
Washington, DC
The Board of Governors of the Federal Reserve System
Washington, DC
(b) The Trustee is authorized to exercise corporate trust powers.
GENERAL
Item 2. Affiliations with Obligor and Underwriters. If the obligor or
------------------------------------------
any underwriter for the obligor is an affiliate of the Trustee,
describe each such affiliation.
None
See Note following Item 16.
Items 3-15 are not applicable because to the best of the Trustee's knowledge the
---------------------------------------------------------------------
obligor is not in default under any Indenture for which the Trustee acts as
- ---------------------------------------------------------------------------
Trustee.
- -------
Item 16. List of Exhibits. Listed below are all the exhibits filed as a part
----------------
of this statement of eligibility and qualification. Exhibits 1-4 are
incorporated by reference from filing 333-48849.
Exhibit 1. Copy of Articles of Association of the trustee now in
effect.
Exhibit 2. a. A copy of the certificate of the Comptroller of
Currency dated June 1, 1965, authorizing Firstar Bank
of Minnesota, N.A. to act as fiduciary.
b. A copy of the certificate of authority of the trustee
to commence business issued June 9, 1903, by the
Comptroller of the Currency to Firstar Bank of
Minnesota, N.A.
Exhibit 3. A copy of the authorization of the trustee to exercise
corporate trust powers issued by the Federal Reserve
Board.
Exhibit 4 Copy of the By-Laws of the trustee as now in effect.
Exhibit 5. Copy of each Indenture referred to in Item 4.
Exhibit 6. The consent of the trustee required by Section 321(b)
of the Act.
<PAGE>
Exhibit 7. A copy of the latest report of condition of the trustee
published pursuant to law or the requirements of its
supervising or examining authority.
NOTE
The answers to this statement insofar as such answers relate to what
persons have been underwriters for any securities of the obligor within three
years prior to the date of filing this statement, or what persons are owners of
10% or more of the voting securities of the obligor, or affiliates, are based
upon information furnished to the Trustee by the obligor. While the Trustee has
no reason to doubt the accuracy of any such information, it cannot accept any
responsibility therefor.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
Trustee, a national banking association organized and existing under the laws of
the United States, has duly caused this statement of eligibility and
qualification to be signed on its behalf by the undersigned, thereunto duly
authorized, and its seal to be hereunto affixed and attested, all in the City of
Saint Paul and State of Minnesota on the 18th day of May, 2000.
FIRSTAR BANK, N.A.,
(SEAL)
/s/ Frank P. Leslie III
------------------------------------
Frank P. Leslie III, Vice President
<PAGE>
EXHIBIT 6
CONSENT
In accordance with Section 321(b) of the Trust Indenture Act of 1939, the
undersigned, Firstar Bank of Minnesota, N.A., hereby consents that reports of
examination of the undersigned by Federal, State, Territorial or District
authorities may be furnished by such authorities to the Securities and Exchange
Commission upon its request therefor.
Dated: May 18, 2000
FIRSTAR BANK, N.A.,
/s/ Frank P. Leslie III
------------------------------------
Frank P. Leslie III, Vice President
<PAGE>
EXHIBIT 7
CONSOLIDATED REPORT OF CONDITION
FIRSTAR BANK, N.A.
for December 31, 1999
All schedules are to be reported in thousands of dollars. Unless
otherwise indicated, report the amount outstanding as of the last business
day of the quarter.
BALANCE SHEET
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
DOLLAR AMOUNTS IN
ASSETS THOUSANDS
- ----------------------------------------------------------------------------------------------------------------------
<S> <C>
1. Cash and balances due from depository institutions
- ----------------------------------------------------------------------------------------------------------------------
a. Noninterest-bearing balances and currency and coin $2,212,528
- ----------------------------------------------------------------------------------------------------------------------
b. Interest-bearing balances 53,411
- ----------------------------------------------------------------------------------------------------------------------
2. Securities:
- ----------------------------------------------------------------------------------------------------------------------
a. Held-to-maturity securities 194,454
- ----------------------------------------------------------------------------------------------------------------------
b. Available-for-sale securities 5,901,086
- ----------------------------------------------------------------------------------------------------------------------
3. Federal funds sold and securities purchased under agreements to resell 793,301
- ----------------------------------------------------------------------------------------------------------------------
4. Loans and lease financing receivables:
- ----------------------------------------------------------------------------------------------------------------------
a. Loans and leases, net of unearned income 28,054,743
- ----------------------------------------------------------------------------------------------------------------------
b. LESS: Allowance for loan and less losses 370,697
- ----------------------------------------------------------------------------------------------------------------------
c. LESS: Allocated transfer risk reserve 0
- ----------------------------------------------------------------------------------------------------------------------
d. Loans and leases, net of unearned income, allowance and reserve 27,684,046
- ----------------------------------------------------------------------------------------------------------------------
5. Trading Assets 32,233
- ----------------------------------------------------------------------------------------------------------------------
6. Premises and Fixed Assets (including capitalized leases) 607,838
- ----------------------------------------------------------------------------------------------------------------------
7. Other Real Estate Owned 8,094
- ----------------------------------------------------------------------------------------------------------------------
8. Investments in unconsolidated subsidiaries and associated companies 110,506
- ----------------------------------------------------------------------------------------------------------------------
9. Customers' liability to this bank on acceptances outstanding 11,594
- ----------------------------------------------------------------------------------------------------------------------
10. Intangible Assets 959,264
- ----------------------------------------------------------------------------------------------------------------------
11. Other Assets 1,595,733
- ----------------------------------------------------------------------------------------------------------------------
12. Total Assets 40,164,088
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
