AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 1, 2000.
REGISTRATION NO. 333-__________
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------------------
FUELCELL ENERGY, INC.
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(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 06-0853042
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(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
3 GREAT PASTURE ROAD
DANBURY, CONNECTICUT 06813
(203) 825-6000
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(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA
CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
JERRY D. LEITMAN
PRESIDENT
FUELCELL ENERGY, INC.
3 GREAT PASTURE ROAD
DANBURY, CONNECTICUT 06813
(203) 825-6000
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(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA
CODE, OF AGENT FOR SERVICE)
Copies of All Communications To:
--------------------------------
RICHARD A. KRANTZ, ESQ.
ROBINSON & COLE LLP
695 EAST MAIN STREET
STAMFORD, CONNECTICUT 06904
(203) 462-7500
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after this Registration Statement becomes effective.
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<PAGE>
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, please 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, please 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. [_]
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
==================================== ============== ================== ==================== ==================
PROPOSED PROPOSED MAXIMUM
TITLE OF EACH CLASS OF SECURITIES AMOUNT TO BE MAXIMUM OFFERING AGGREGATE OFFERING AMOUNT OF
TO BE REGISTERED REGISTERED PRICE PER UNIT PRICE REGISTRATION FEE
==================================== ============== ================== ==================== ==================
<S> <C> <C> <C> <C>
Debt Securities
Preferred Stock, $0.01 par value(4)
Common Stock, $0.0001 par value(5) $250,000,000 100%(1)(2)(3) $250,000,000 $66,000
(1)(2) (1)(2)(3)
==================================== ============== ================== ==================== ==================
</TABLE>
(1) There are being registered under this Registration Statement such
indeterminate number of shares of Common Stock and Preferred Stock of
the Registrant, and such indeterminate principal amount of Debt
Securities of the Registrant, as shall have an aggregate initial
offering price not to exceed $250,000,000. Any offering of Debt
Securities by the Registrant denominated other than in U.S. dollars
will be treated as the equivalent of U.S. dollars based on the
exchange rate applicable to the purchase of such Debt Securities at
the time of initial offering. If any Debt Securities are issued at an
original issue discount by the Registrant, then the securities
registered shall include such additional Debt Securities as may be
necessary such that the aggregate initial public offering price of all
securities issued pursuant to this Registration Statement will equal
$250,000,000. Any securities registered under this Registration
Statement may be sold separately or as units with other securities
registered under this Registration Statement. The proposed maximum
initial offering price per unit will be determined from time to time
by the Registrant in connection with, and at the time of, the issuance
by the Registrant of the securities registered under this Registration
Statement.
(2) Not specified with respect to each class of securities to be
registered by the Registrant pursuant to General Instruction II.D1 to
Form S-3.
(3) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(o) under the Securities Act of 1933. No separate
consideration will be received for any securities registered hereunder
that are issued upon exercise, conversion or exchange of Debt
Securities or Preferred Stock registered hereunder.
(4) Including such indeterminate number of shares of Preferred Stock as
may from time to time be issued upon exercise, conversion or exchange
of Debt Securities registered hereunder, to the extent any such Debt
Securities are, by their terms, convertible into Preferred Stock.
(5) Including such indeterminate number of shares of Common Stock as may
from time to time be issued upon exercise, conversion or exchange of
Debt Securities or Preferred Stock registered hereunder, to the extent
any of such Debt Securities or shares of Preferred Stock are, by their
terms, convertible into Common Stock.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE
REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT
THIS REGISTRATION STATEMENT SHALL 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.
================================================================================
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<PAGE>
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE 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 IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED NOVEMBER 1, 2000
$250,000,000
FUELCELL ENERGY, INC.
Debt Securities
Preferred Stock
Common Stock
----------------------------------------
We may offer and sell the securities listed above with an aggregate
offering price of up to $250 million in connection with this prospectus. We will
provide the specific terms of these securities in one or more supplements to
this prospectus. You should read this prospectus and any prospectus supplement
carefully before you invest.
Our common stock is quoted on the Nasdaq National Market under the symbol
"FCEL." The applicable prospectus supplement will contain information, where
applicable, as to any other listing on any securities exchange of the securities
covered by this prospectus supplement.
We may sell the securities directly to investors, through agents designated
from time to time or to or through underwriters or dealers. See "Plan of
Distribution." If any underwriters are involved in the sale of any securities in
respect of which this prospectus is being delivered, the names of such
underwriters and any applicable commissions or discounts will be set forth in a
prospectus supplement relating to those securities.
------------------------------------------
INVESTING IN OUR SECURITIES INVOLVES RISKS THAT ARE DESCRIBED IN THE "RISK
FACTORS" SECTION BEGINNING ON PAGE 3 OF THIS PROSPECTUS.
------------------------------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
This prospectus may not be used to offer or sell any securities unless
accompanied by a prospectus supplement.
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The date of this prospectus is _________, 2000.
<PAGE>
TABLE OF CONTENTS
PAGE
----
About This Prospectus................................................2
Risk Factors.........................................................3
FuelCell Energy, Inc................................................14
Where You Can Find More Information.................................14
Forward-Looking Statements..........................................15
Ratio of Earnings to Fixed Charges..................................16
Use of Proceeds.....................................................17
Dividend Policy.....................................................17
Description of Debt Securities......................................18
Description of Preferred Stock......................................26
Description of Common Stock.........................................30
Plan of Distribution................................................32
Legal Matters.......................................................33
Experts.............................................................33
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ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
SEC using a "shelf" registration process. Under this shelf registration process,
we may, from time to time, over approximately the next two years, sell debt
securities, preferred stock and common stock, either separately or in units, in
one or more offerings, up to a total dollar amount of $250,000,000.
This prospectus provides you with a general description of the securities
we may offer. Each time we sell securities, we will provide a prospectus
supplement that will contain specific information about the terms of that
offering and the offered securities. The prospectus supplement may also add,
update or change information contained in this prospectus. Any statement that we
make in this prospectus will be modified or superseded by any inconsistent
statement made by us in a prospectus supplement. You should read both this
prospectus and any prospectus supplement, together with additional information
described under the heading "Where You Can Find More Information."
Unless the context otherwise requires, references in this prospectus and
the accompanying prospectus supplement to "we," "us" and "our" refer to FuelCell
Energy, Inc. Direct FuelCell(TM) is a trademark of FuelCell Energy, Inc. As used
in this prospectus and the accompanying prospectus supplement, "kilowatt" (kW)
means 1,000 watts and "megawatt" (MW) means 1,000,000 watts.
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RISK FACTORS
BEFORE INVESTING IN OUR SECURITIES, YOU SHOULD CAREFULLY CONSIDER THE RISKS
DESCRIBED BELOW AND ANY RISKS CONTAINED IN THE ACCOMPANYING PROSPECTUS
SUPPLEMENT AS WELL AS THE OTHER INFORMATION INCLUDED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS AND THE PROSPECTUS SUPPLEMENT. IF ANY OF THESE
RISKS OCCUR, OUR BUSINESS, PROSPECTS, RESULTS OF OPERATIONS AND FINANCIAL
CONDITION COULD BE HARMED. IN THAT CASE, THE TRADING PRICE OF OUR SECURITIES
COULD DECLINE, AND YOU COULD LOSE ALL OR PART OF YOUR INVESTMENT.
WE HAVE RECENTLY INCURRED LOSSES AND ANTICIPATE CONTINUED LOSSES AND NEGATIVE
CASH FLOW
We are currently transitioning from a research and development company that
has been primarily dependent on government contracts to a company focusing on
commercial products. As such, we have not achieved profitability since our
fiscal year ended October 31, 1997 and expect to continue to incur net losses
and generate negative cash flow until we can produce sufficient revenues to
cover our costs. We incurred a net loss of $985,000 for the fiscal year ended
October 31, 1999, and a net loss of $3,010,000 for the nine months ended July
31, 2000. Even if we achieve our objective of bringing our first commercial
product to market in late 2001, we anticipate that we will continue to incur
losses and generate negative cash flow until we can cost-effectively produce and
sell our Direct FuelCell(TM) products, which we do not expect to occur for
several years. Even if we do achieve profitability, we may be unable to sustain
or increase our profitability in the future. We may never become profitable. For
the reasons discussed in more detail below, there are substantial uncertainties
associated with our achieving and sustaining profitability.
OUR COST REDUCTION STRATEGY MAY NOT SUCCEED OR MAY BE SIGNIFICANTLY DELAYED
Our cost reduction strategy is based on the assumption that a significant
increase in production will result in the realization of economies of scale. In
addition, certain aspects of our cost reduction strategy rely on advancements in
our manufacturing process and engineering design that, to a large degree, are
currently not ascertainable. A failure by us to achieve a lower cost structure
through economies of scale and improvements in the manufacturing process and
engineering design would have a material adverse effect on our commercialization
plans and, therefore, our business, prospects, results of operations and
financial condition.
We expect the production costs of our initial commercial products to be
higher than their sales prices. We recognize that successfully implementing our
strategy and obtaining a significant share of the distributed generation market
will require that we offer our Direct FuelCell(TM) products at competitive
prices, which can only be accomplished when production costs are cut
substantially from current levels. If we are unable to produce Direct
FuelCell(TM) products at competitive prices relative to alternative technologies
and products, our target market customers will be unlikely to buy our Direct
FuelCell(TM) products.
Our Direct FuelCell(TM) products produce electricity from a variety of
hydrocarbon fuels, such as natural gas and methanol. If these fuels are not
readily available or if their prices are such that electricity produced by our
products costs more than electricity provided through other generation sources,
our products would be less economically attractive to potential energy users. In
addition, we have no control over the prices of several types of competitive
energy sources such as oil, gas or coal. Significant decreases in the price of
these inputs could also have a material adverse effect on our business because
other generation sources could be more economically attractive to consumers than
our Direct FuelCell(TM) products.
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COMMERCIALIZATION OF OUR PRODUCTS IS DEPENDENT ON CONDUCTING SUCCESSFUL FIELD
TRIALS
One key aspect of our strategy is to leverage the success of our field
trials and demonstration projects into long-term distributor-type relationships
that will result in these distributors marketing our Direct FuelCell(TM)
products directly to energy customers. For example, MTU - Friedrichshafen GmbH,
a subsidiary of Daimler Chrysler (MTU), is currently field testing a 250 kW Hot
Module power plant in Bielefeld, Germany that incorporates our Direct
FuelCell(TM) as its fuel cell component. We believe that our fuel cell
commercialization program is dependent upon us conducting one or more additional
commercial field trials of our power plants and completing substantial
additional research and development. We have planned several field trials and
demonstration projects in 2001 for our sub-megawatt and megawatt stationary fuel
cell power plants. We have not yet, however, conducted any field trials of our
proposed commercial design megawatt class products.
Field trials and demonstration projects may encounter problems and delays
for a number of reasons, including the failure of our technology, the failure of
the technology of others, the failure to combine these technologies properly and
the failure to maintain and service the test prototypes properly. Many of these
potential problems and delays are beyond our control.
A failure by us to conduct field trials and demonstration projects of our
megawatt class products or a failure to site the scheduled sub-megawatt power
plants and complete these commercial field trials and research and development
as currently planned could delay the timetable by which we believe we can begin
to commercially sell our Direct FuelCell(TM) products. The failure of planned
commercial field trials to perform as well as we anticipate could also have a
material adverse effect on our commercialization plans, including the ability to
enter into long-term distributor-type relationships for our Direct FuelCell(TM)
products. Any delay, performance failure or perceived problem with our field
trials could hurt our reputation in the distributed generation market and,
therefore, could have a material adverse effect on our business, prospects,
results of operations and financial condition.
WE CURRENTLY FACE AND WILL CONTINUE TO FACE SIGNIFICANT COMPETITION
Our Direct FuelCell(TM) products currently face and will continue to face
significant competition. Technological advances in alternative energy products
or improvements in the electric grid or other fuel cell technologies may
negatively affect the development or sale of some or all of our products or make
our products uncompetitive or obsolete prior to commercialization or afterwards.
Other companies, some of which have substantially greater resources than us, are
currently engaged in the development of products and technologies that are
similar to, or may be competitive with, certain of our products and
technologies.
As our Direct FuelCell(TM) products have the potential to replace existing
power sources, competition with our products will come from current power
technologies, from improvements to current power technologies and from new
alternative power technologies, including other types of fuel cells. The
distributed generation market, our target market, is currently serviced by
several manufacturers with existing customers and suppliers. These manufacturers
use proven and widely accepted technologies such as internal combustion engines
and turbines as well as coal, oil and nuclear powered generators.
We believe that we are the only domestic company exclusively engaged in the
development and production of carbonate fuel cells. In Japan, at least six
manufacturers have demonstrated interest in developing and marketing carbonate
fuel cells. One of these manufacturers has demonstrated extended operation of a
200 kW carbonate fuel cell. Two of these manufacturers have jointly demonstrated
extended operation of a 100 kW carbonate fuel cell and recently tested a 1 MW
plant. In Europe, there are several companies engaged in carbonate fuel cell
development that are potential competitors. Our licensee, MTU, and its partners
have conducted the most significant activity in Europe.
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Additionally, there are competitors working on developing technologies
other than carbonate fuel cells in our target market. Emerging technologies in
our target distributed generation market include small gas turbines, PEM fuel
cells, phosphoric acid fuel cells and solid oxide fuel cells. Major competitors
using or developing these technologies include Capstone Turbine Corporation,
Elliot Energy Systems and Honeywell International Inc. in the case of small gas
turbines, Ballard Power Systems Inc. in the case of PEM fuel cells, ONSI
Corporation in the case of phosphoric acid fuel cells, and SiemensWestinghouse
Electric Company and Mitsubishi Heavy Industries, Ltd. in the case of solid
oxide fuel cells. Each of these competitors has the potential to capture market
share in our target market, which could have a material adverse effect on our
position in the industry.
WE MAY NOT MEET OUR PRODUCT DEVELOPMENT AND COMMERCIALIZATION MILESTONES
We have established product development and commercialization milestones
that we use to assess our progress toward developing commercially viable Direct
FuelCell(TM) products. These milestones relate to technology and design
improvements as well as to dates for achieving development goals. To gauge our
progress, we operate, test and evaluate our Direct FuelCell(TM) products under
actual conditions. If our systems exhibit technical defects or are unable to
meet cost or performance goals, including power output, useful life and
reliability, our commercialization schedule could be delayed and potential
purchasers of our initial commercial Direct FuelCell(TM) products may decline to
purchase them or choose to purchase alternative technologies. We cannot be sure
that we will successfully achieve our milestones in the future or that any
failure to achieve these milestones will not result in potential competitors
gaining advantages in our target market. Failure to meet publicly announced
milestones may have a material adverse effect on our operations and our stock
price.
OUR COMMERCIALIZATION PLANS ARE DEPENDENT ON MARKET ACCEPTANCE OF OUR DIRECT
FUELCELL(TM) PRODUCTS
Our commercialization plans, which include bringing our sub-megawatt class
product to market in late 2001, are dependent upon market acceptance of, as well
as enhancements to, our Direct FuelCell(TM) products. Fuel cell systems
represent an emerging market, and we cannot be sure that potential customers
will accept fuel cells as a replacement for traditional power sources. As is
typical in a rapidly evolving industry, demand and market acceptance for
recently introduced products and services are subject to a high level of
uncertainty and risk. Since the distributed generation market is new and
evolving, it is difficult to predict with certainty the size of the market and
its growth rate. The development of a market for our Direct FuelCell(TM)
products may be affected by many factors that are out of our control, including:
o the cost competitiveness of our Direct FuelCell(TM) products;
o the future costs of natural gas and other fuels used by our Direct
FuelCell(TM) products;
o consumer reluctance to try a new product;
o consumer perceptions of the safety of our Direct FuelCell(TM)
products;
o the pace of utility deregulation nationwide, which could affect the
market for distributed generation;
o local permitting and environmental requirements; and
o the emergence of newer, more competitive technologies and products.
If a sufficient market fails to develop or develops more slowly than we
anticipate, we may be unable to recover the losses we will have incurred in the
development of our Direct FuelCell(TM) products and may never achieve
profitability.
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OUR GOVERNMENT RESEARCH AND DEVELOPMENT CONTRACTS ARE CRITICAL TO THE
IMPLEMENTATION OF OUR COMMERCIALIZATION PLANS
Since 1995, our revenues have been principally derived from a long-term
cooperative agreement with the U.S. Department of Energy (DOE). This agreement
covers the design, scale-up, construction and testing of direct carbonate fuel
cells operating on natural gas. Excluding cost share funding, the present
estimated value of this agreement with the DOE, which expires in December 2003,
is $135 million. This agreement is critical to the continued development and
commercialization of our technology and our products.
Generally, our U.S. government research and development contracts,
including the DOE cooperative agreement, are subject to the risk of termination
at the convenience of the contracting agency. Furthermore, these contracts,
irrespective of the amounts allocated by the contracting agency, are subject to
annual congressional appropriations and the results of government or agency
sponsored audits of our cost reduction efforts and our cost projections. We can
only receive funds under these contracts ultimately made available to us
annually by Congress as a result of the appropriations process. Accordingly, we
cannot be sure whether or not we will receive the full amount allocated by the
DOE under the DOE cooperative agreement or the full amounts allocated under our
other government research and development contracts. We also cannot be sure that
we will be able to finance or otherwise meet the cost sharing requirements of
these contracts, which are conditions to receiving any amounts allocated under
these contracts. Failure to receive the full amounts allocated under any of our
government research and development contracts could materially adversely affect
our commercialization plans and, therefore, our business, prospects, results of
operations and financial condition.
THE UNITED STATES GOVERNMENT HAS CERTAIN RIGHTS RELATING TO OUR INTELLECTUAL
PROPERTY
Many of our United States patents are the result of government-funded
research and development programs, including the DOE cooperative agreement. Our
patents that were the result of government-funded research prior to January 1988
(the date that we qualified as a "small business") are owned by the United
States government and have been licensed to us. This license is revocable only
in the limited circumstances where it has been demonstrated that we are not
making an effort to commercialize the invention. Our patents that were the
result of government-funded research after January 1988 automatically belong to
us because of our "small business" status.
However, all of our United States patents that have resulted from
government-funded research are subject to the risk of the exercise of "march-in"
rights by the government. March-in rights refer to the right of the United
States government or government agency to exercise its non-exclusive,
royalty-free, irrevocable worldwide license to any technology developed under
contracts funded by the government if the contractor fails to continue to
develop the technology. In addition, these "march-in" rights permit the United
States government to take title to these patents and license the patented
technology to third parties if the contractor fails to utilize the patents.
The failure to continue to qualify as a "small business" under applicable
government regulations, and the related inability to own our patents developed
with government funds if we do not so qualify, or the exercise of "march-in"
rights by the government could materially adversely affect our business,
prospects, results of operations and financial condition.
OUR FUTURE SUCCESS AND GROWTH IS DEPENDENT ON OUR DISTRIBUTION STRATEGY
We do not plan to establish a direct distribution infrastructure for our
Direct FuelCell(TM) products. A key aspect of our strategy is to use multiple
third-party distribution channels to ultimately service our diverse customer
base. Depending on the needs of the customer, our Direct FuelCell(TM) products
could be distributed through a value added distributor who could provide a
package of our products and various other components such as flywheels and
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battery storage devices; through an energy services company who could arrange
various ancillary services for the customer; or through power generation
equipment suppliers. For example, we recently entered into a distribution
agreement with PPL Energy Plus as the first North American distributor of our
Direct FuelCell(TM) products. In addition, we anticipate that our Direct
FuelCell(TM) components will be distributed through original equipment
manufacturers (OEMs), such as MTU, who will then integrate our Direct
FuelCell(TM) components into power plant products.
We cannot assure you that we will enter into distributor relationships that
are consistent with, or sufficient to support, our commercialization plans or
our growth strategy or that these relationships will be on terms favorable to
us. Even if we enter into these types of relationships, we cannot assure you
that the distributors with which we form relationships will focus adequate
resources on selling our products or will be successful in selling them. Some of
these distributor arrangements have or will require that we grant exclusive
distribution rights to companies in defined territories. These exclusive
arrangements could result in us being unable to enter into other arrangements at
a time when the distributor with which we form a relationship is not successful
in selling our products or has reduced its commitment to marketing our products.
To the extent we enter into distributor relationships, the failure of these
distributors in assisting us with the marketing and distribution of our products
may adversely affect our financial condition and results of operations.
We cannot be sure that MTU will continue to, or OEMs will, manufacture or
package products using our Direct FuelCell(TM) components. In this area, our
success will largely depend upon our ability to make our products compatible
with the power plant products of OEMs and the ability of these OEMs to sell
their products containing our products. In addition, some OEMs may need to
redesign or modify their existing power plant products to fully incorporate our
products. Accordingly, any integration, design, manufacturing or marketing
problems encountered by MTU or OEMs could adversely affect the market for our
Direct FuelCell(TM) products and, therefore, our business, prospects, results of
operations and financial condition.
WE DEPEND ON THIRD PARTY SUPPLIERS FOR THE DEVELOPMENT AND SUPPLY OF KEY
COMPONENTS FOR OUR DIRECT FUELCELL(TM) PRODUCTS
We purchase several key components of our products from other companies. A
supplier's failure to develop and supply components in a timely manner or to
supply components that meet our quality, quantity or cost requirements or
technical specifications or our inability to obtain alternative sources of these
components on a timely basis or on terms acceptable to us could harm our ability
to manufacture our Direct FuelCell(TM) products. In addition, to the extent the
processes that our suppliers use to manufacture components are proprietary, we
may be unable to obtain comparable components from alternative suppliers.
We do not know when or whether we will secure long-term supply
relationships with any of our suppliers or whether such relationships will be on
terms that will allow us to achieve our objectives. In addition, there is a
limited number of suppliers for some of the key components of our Direct
FuelCell(TM) products. Our business, prospects, results of operations and
financial condition could be harmed if we fail to secure relationships with
entities who will supply the required components for our Direct FuelCell(TM)
products.
WE HAVE NO EXPERIENCE MANUFACTURING OUR DIRECT FUELCELL(TM) PRODUCTS ON A
COMMERCIAL BASIS
To date, we have focused primarily on research and development, and
demonstrations, and we have no experience manufacturing our Direct FuelCell(TM)
products on a commercial basis. We plan to expand our product capacity from our
current capacity of 5 MW per year to 50 MW per year in late 2001. We expect that
we will increase our manufacturing capacity in stages to 400 MW by 2004. We
cannot be sure that we will be able to achieve our planned increases in
production capacity.
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Even if we are successful in achieving our planned increases in production
capacity, we cannot be sure that we will do so in time to meet our product
commercialization schedule or to satisfy the requirements of our customers.
Given our dependence on government research and development contracts and the
necessity of providing government entities with substantial amounts of
information, our sales process has historically been long and time-consuming. We
will need to shorten the time from initial contact to final product delivery if
we hope to expand production, reach a wider customer base and forecast revenues
with any degree of certainty. Additionally, we cannot be sure that we will be
able to develop efficient, low-cost manufacturing capabilities and processes
that will enable us to meet our cost goals and profitability projections. Our
failure to shorten the sales cycle for our Direct FuelCell(TM) products or to
develop these advanced manufacturing capabilities and processes, or meet our
cost goals, could have a material adverse effect on our business, prospects,
results of operations and financial condition.
WE DEPEND ON OUR INTELLECTUAL PROPERTY, AND OUR FAILURE TO PROTECT THAT
INTELLECTUAL PROPERTY COULD ADVERSELY AFFECT OUR FUTURE GROWTH AND SUCCESS
Failure to protect our existing intellectual property rights may result in
the loss of our exclusivity or the right to use our technologies. If we do not
adequately ensure our freedom to use certain technology, we may have to pay
others for rights to use their intellectual property, pay damages for
infringement or misappropriation or be enjoined from using such intellectual
property. We rely on patent, trade secret, trademark and copyright law to
protect our intellectual property. The patents that we have obtained will expire
between 2000 and 2018 and the average remaining life of our patents is
approximately nine years. Some of our intellectual property is not covered by
any patent or patent application and includes trade secrets and other know-how
that is not patentable, particularly as it relates to our manufacturing
processes and engineering design. In addition, some of our intellectual property
includes technologies and processes that may be similar to the patented
technologies and processes of third parties. If we are found to be infringing
third-party patents, we do not know whether we will able to obtain licenses to
use such patents on acceptable terms, if at all. Our patent position is subject
to complex factual and legal issues that may give rise to uncertainty as to the
validity, scope and enforceability of a particular patent. Accordingly, we
cannot assure you that:
o any of the U.S. patents or foreign patents owned by us or other
patents that third parties license to us will not be invalidated,
circumvented, challenged, rendered unenforceable or licensed to
others; or
o any of our pending or future patent applications will be issued with
the breadth of claim coverage sought by us, if issued at all.
In addition, effective patent, trademark, copyright and trade secret
protection may be unavailable, limited or not applied for in certain foreign
countries.
We also seek to protect our proprietary intellectual property, including
intellectual property that may not be patented or patentable, in part by
confidentiality agreements and, if applicable, inventors' rights agreements with
our strategic partners and employees. We cannot assure you that these agreements
will not be breached, that we will have adequate remedies for any breach or that
such persons or institutions will not assert rights to intellectual property
arising out of these relationships. Certain of our intellectual property has
been licensed to us on a non-exclusive basis from third parties who may also
license such intellectual property to others, including our competitors. If our
licensors are found to be infringing third-party patents, we do not know whether
we will be able to obtain licenses to use the intellectual property licensed to
us on acceptable terms, if at all.
If necessary or desirable, we may seek extensions of existing licenses or
further licenses under the patents or other intellectual property rights of
others. However, we can give no assurances that we will obtain such extensions
or further licenses or that the terms of any offered licenses will be acceptable
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to us. The failure to obtain a license from a third party for intellectual
property that we use at present could cause us to incur substantial liabilities,
and to suspend the manufacture or shipment of products or our use of processes
requiring the use of such intellectual property.
While we are not currently engaged in any material intellectual property
litigation, we could become subject to lawsuits in which it is alleged that we
have infringed the intellectual property rights of others or commence lawsuits
against others who we believe are infringing upon our rights. Our involvement in
intellectual property litigation could result in significant expense to us,
adversely affecting the development of sales of the challenged product or
intellectual property and diverting the efforts of our technical and management
personnel, whether or not such litigation is resolved in our favor.
OUR FUTURE SUCCESS WILL DEPEND ON OUR ABILITY TO ATTRACT AND RETAIN QUALIFIED
MANAGEMENT AND TECHNICAL PERSONNEL
Our future success is substantially dependent on the continued services and
on the performance of our executive officers and other key management,
engineering, scientific, manufacturing and operating personnel, particularly
Jerry Leitman, our President and Chief Executive Officer, and Dr. Hansraj Maru
and Christopher Bentley, our Executive Vice Presidents. The loss of the services
of any executive officer, including Mr. Leitman, Dr. Maru and Mr. Bentley, or
other key management, engineering, scientific, manufacturing and operating
personnel could materially adversely affect our business. Our ability to achieve
our development and commercialization plans will also depend on our ability to
attract and retain additional qualified management and technical personnel.
Recruiting personnel for the fuel cell industry is highly competitive. We do not
know whether we will be able to attract or retain additional qualified
management and technical personnel. Our inability to attract and retain
additional qualified management and technical personnel, or the departure of key
employees, could materially adversely affect our development and
commercialization plans and, therefore, our business, prospects, results of
operations and financial condition.
OUR MANAGEMENT MAY BE UNABLE TO MANAGE RAPID GROWTH EFFECTIVELY
We expect to rapidly expand our manufacturing capabilities, accelerate the
commercialization of our products and enter a period of rapid growth, which will
place a significant strain on our senior management team and our financial and
other resources. The proposed expansion will expose us to increased competition,
greater overhead, marketing and support costs and other risks associated with
the commercialization of a new product. Our ability to manage our rapid growth
effectively will require us to continue to improve our operations, to improve
our financial and management information systems and to train, motivate and
manage our employees. Difficulties in effectively managing the budgeting,
forecasting and other process control issues presented by such a rapid expansion
could harm our business, prospects, results of operations and financial
condition.
WE HAVE CONTINGENT OBLIGATIONS RELATING TO EVERCEL
In connection with our spin-off on February 22, 1999 of our former battery
group, now owned by Evercel, Inc. (Evercel), we entered into several agreements,
including a license assistance agreement, with Evercel. Under the license
assistance agreement, Evercel has agreed to fulfill our obligations under a
joint venture contract relating to battery operations in China until we obtain
certain required third-party and governmental consents. We do not believe that
we have any remaining material exposure with respect to this joint venture in
light of the license assistance agreement. We cannot assure you, however, that,
if Evercel does not continue to perform under the license assistance agreement,
fulfilling our contingent obligations under the joint venture contract will not
have a material adverse effect on our business, prospects, results of operations
and financial condition.
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WE MAY BE AFFECTED BY ENVIRONMENTAL AND OTHER GOVERNMENTAL REGULATION
Although our products are not currently subject to direct regulation by any
governmental agency, it is possible that industry specific laws and regulations
will be adopted covering issues such as environmental standards, transmission
scheduling, distribution and characteristics and quality of our products and
services. Such regulation could limit the growth in the use of carbonate fuel
cells, decrease the acceptance of fuel cells as a commercial product and
increase our costs and, therefore, the price of our Direct FuelCell(TM)
products. Any such new legislation or regulation, the application of existing
laws and regulations from jurisdictions whose laws do not currently apply to our
business, or the application of existing laws and regulations to the energy
industry could have a material adverse effect on our business, prospects,
results of operations and financial condition.
UTILITY COMPANIES COULD CHARGE FEES TO OUR CUSTOMERS THAT COULD MAKE OUR
PRODUCTS LESS DESIRABLE
Utility companies commonly charge fees to larger, industrial customers for
disconnecting from the electric grid or for having the capacity to use power
from the electric grid for back up purposes. These fees could increase the cost
to our customers of using our Direct FuelCell(TM) products and could make our
products less desirable, thereby harming our business, prospects, results of
operations and financial condition.
CHANGES IN GOVERNMENT REGULATIONS AND ELECTRIC UTILITY INDUSTRY RESTRUCTURING
MAY AFFECT DEMAND FOR OUR DIRECT FUELCELL(TM) PRODUCTS
The market for electricity generation products is heavily influenced by
federal and state governmental regulations and policies. Changes in regulatory
standards or policies could reduce the level of investment in the research and
development of alternative energy sources, including fuel cells, and could
result in a reduction in the potential demand for our Direct FuelCell(TM)
products. Our target market, the distributed generation market, is driven by
deregulation and restructuring of the electric utility industry in the United
States and elsewhere and by the requirements of utilities, independent power
producers and end users. Deregulation of the electric utility industry is
subject to government policies that will determine the pace and extent of
deregulation. Changes in government and public policy over time could affect
deregulation and adversely affect our prospects for commercializing our Direct
FuelCell(TM) products and our financial results. We cannot predict how the
deregulation and restructuring of the electric utility industry will ultimately
affect the market for our Direct FuelCell(TM) products.
WE MAY BE UNABLE TO RAISE ADDITIONAL CAPITAL TO COMPLETE OUR PRODUCT DEVELOPMENT
AND COMMERCIALIZATION PLANS
Our product development and commercialization schedule could be delayed if
we are unable to fund our research and development activities, our field trials
and demonstration projects or the development of our manufacturing capabilities.
Future capital requirements are dependent upon many factors, including, but not
limited to, the rate at which we expand production volume capabilities, the
amount used to fund demonstration projects and field trials, the level of
government funding provided to us and our investment in new technology. In
addition to the proceeds from offerings of our securities and expected
government funding, we believe it is likely that we will need additional funding
to expand our manufacturing capabilities to the level where volume efficiencies
can be achieved consistent with our plans to fully commercialize our products.
Some of our potential strategic business partners have invested in us and others
have indicated interest in investing in us. However, additional financing may
not be available and, if available, it may not be available on terms favorable
to us or our stockholders. If additional funds are raised through the issuance
of equity securities, the percentage ownership of our then current stockholders
will be reduced. If adequate funds are not available to satisfy either short or
long-term capital requirements, we may be required to limit operations in a
manner inconsistent with our commercialization plans.
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WE COULD BE LIABLE FOR ENVIRONMENTAL DAMAGES RESULTING FROM OUR RESEARCH,
DEVELOPMENT OR MANUFACTURING OPERATIONS
Our business exposes us to the risk of harmful substances escaping into the
environment, resulting in personal injury or loss of life, damage to or
destruction of property, and natural resource damage. Depending on the nature of
the claim, our current insurance policies may not adequately reimburse us for
costs incurred in settling environmental damage claims, and in some instances,
we may not be reimbursed at all. Our business is subject to numerous federal,
state and local laws and regulations that govern environmental protection and
human health and safety. These laws and regulations have changed frequently in
the past and it is reasonable to expect additional and more stringent changes in
the future. Our operations may not comply with future laws and regulations and
we may be required to make significant unanticipated capital and operating
expenditures. If we fail to comply with applicable environmental laws and
regulations, governmental authorities may seek to impose fines and penalties on
us or to revoke or deny the issuance or renewal of operating permits and private
parties may seek damages from us. Under those circumstances, we might be
required to curtail or cease operations, conduct site remediation or other
corrective action, or pay substantial damage claims.
OUR PRODUCTS USE INHERENTLY DANGEROUS, FLAMMABLE FUELS THAT COULD SUBJECT OUR
BUSINESS TO PRODUCT LIABILITY CLAIMS
Our business exposes us to potential product liability claims that are
inherent in hydrogen and products that use hydrogen. Hydrogen is a flammable gas
and therefore a potentially dangerous product. Hydrogen is typically generated
from gaseous and liquid fuels that are also flammable and dangerous, such as
propane, natural gas or methane, in a process known as reforming. Natural gas
and propane could leak into a residence or commercial location and combust if
ignited by another source. Any accidents involving our products or other
hydrogen-based products could materially impede widespread market acceptance and
demand for our Direct FuelCell(TM) products. In addition, we may be held
responsible for damages beyond the scope of our insurance coverage. We also
cannot predict whether we will be able to maintain our insurance coverage on
acceptable terms.
WE ARE SUBJECT TO RISKS INHERENT IN INTERNATIONAL OPERATIONS
Since we plan to market our Direct FuelCell(TM) products both inside and
outside the United States, our success depends, in part, on our ability to
secure foreign customers and our ability to manufacture products that meet
foreign regulatory and commercial requirements. We have limited experience
developing and manufacturing our products to comply with the commercial and
legal requirements of international markets. In addition, we are subject to
tariff regulations and requirements for export licenses, particularly with
respect to the export of certain technologies. We face numerous challenges in
our international expansion, including unexpected changes in regulatory
requirements, fluctuations in currency exchange rates, longer accounts
receivable requirements and collections, difficulties in managing international
operations, potentially adverse tax consequences, restrictions on repatriation
of earnings and the burdens of complying with a wide variety of foreign laws.
WE HAVE LARGE AND INFLUENTIAL STOCKHOLDERS
MTU currently owns approximately 8.7% of our outstanding common stock
(based upon the shares of our common stock outstanding as of September 30,
2000). Loeb Investors Co. LXXV and Warren Bagatelle (a managing director of an
affiliate of Loeb Investors Co. LXXV) collectively own approximately 8.2% of our
outstanding common stock (based upon the shares of our common stock outstanding
as of September 30, 2000). These ownership levels could make it difficult for a
third party to acquire our common stock or have input into the decisions made by
our board of directors, which include Michael Bode of MTU, Warren Bagatelle and
Thomas L. Kempner (Chairman and Chief Executive Officer of an affiliate of Loeb
Investors Co. LXXV). MTU is also a licensee of our technology and a purchaser of
our Direct FuelCell(TM) products. Therefore, it may be in MTU's interest to
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possess substantial influence over matters concerning our overall strategy and
technological and commercial development. In addition, MTU's ownership interest
could raise a conflict of interest if MTU is experimenting with competing
technologies for its own products.
OUR STOCK PRICE HAS BEEN AND COULD REMAIN VOLATILE
The market price for our common stock has been and may continue to be
volatile and subject to extreme price and volume fluctuations in response to
market and other factors, including the following, some of which are beyond our
control:
o failure to meet our product development and commercialization
milestones;
o due to our stage of development, variations in our quarterly operating
results from the expectations of securities analysts or investors;
o downward revisions in securities analysts' estimates or changes in
general market conditions;
o announcements of technological innovations or new products or services
by us or our competitors;
o announcements by us or our competitors of significant acquisitions,
strategic partnerships, joint ventures or capital commitments;
o additions or departures of key personnel;
o investor perception of our industry or our prospects;
o insider selling or buying;
o demand for our common stock; and
o general technological or economic trends.
In the past, following periods of volatility in the market price of their
stock, many companies have been the subject of securities class action
litigation. If we became involved in a securities class action litigation in the
future, it could result in substantial costs and diversion of management's
attention and resources and could harm our stock price, business, prospects,
results of operations and financial condition.
PROVISIONS OF DELAWARE AND CONNECTICUT LAW AND OF OUR CHARTER AND BY-LAWS MAY
MAKE A TAKEOVER MORE DIFFICULT
Provisions in our certificate of incorporation and by-laws and in Delaware
and Connecticut corporate law may make it difficult and expensive for a third
party to pursue a tender offer, change in control or takeover attempt that is
opposed by our management and board of directors. Public stockholders who might
desire to participate in such a transaction may not have an opportunity to do
so. These anti-takeover provisions could substantially impede the ability of
public stockholders to benefit from a change in control or change our management
and board of directors. See "Description of Common Stock."
FUTURE SALES OF OUR COMMON STOCK COULD ADVERSELY AFFECT OUR STOCK PRICE
Substantial sales of our common stock in the public market, or the
perception by the market that such sales could occur, could lower our stock
price or make it difficult for us to raise additional equity capital in the
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future. As of September 30, 2000, we had 15,708,962 shares of common stock
outstanding. Of these shares, as of that date, 15,410,064 shares of our common
stock are freely tradable subject, in some cases, to the volume and manner of
sale limitations under Rule 144 under the Securities Act. As of that date,
298,898 shares of our common stock will become available for sale at various
later dates upon the expiration of various restrictions on resale.
In addition, as of September 30, 2000, 3,367,767 shares of our common stock
were required to be reserved for issuance relating to outstanding options and
warrants to purchase shares of our common stock. As of September 30, 2000,
options to purchase ______ shares of our common stock were issued and
outstanding under our stock option plans, of which options to purchase ______
shares had vested. The outstanding warrants to purchase 1,300,000 shares of our
common stock have not yet vested.
As of September 30, 2000, the holders of up to 292,898 shares of our common
stock had the right, subject to various conditions and the expiration of various
time periods, to require us to file registration statements covering their
shares or to include their shares in registration statements that we may file
for ourselves or for other stockholders. By exercising their registration rights
and selling a large number of shares, these holders could cause the price of our
common stock to fall.
We cannot predict if future sales of our common stock, or the availability
of our common stock for sale, will harm the market price for our common stock or
our ability to raise capital by offering equity securities.
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FUELCELL ENERGY, INC.
We are a leading developer of carbonate fuel cell technology for stationary
power generation. We have designed and are planning to commercialize fuel cell
power plants that offer significant advantages compared to existing power
generation technology. These advantages include higher fuel efficiency,
significantly lower emissions, quieter operation, lower vibration, relaxed
siting and permitting requirements, scalability and potentially lower operating,
maintenance and generation costs. We have conducted successful field trials of
250 kW and 2 MW units. Our initial market entry commercial products will be
rated at 250 kW, 1 MW and 2 MW in capacity and are targeted for utility,
commercial and industrial customers in the growing distributed generation
market. We expect to enter the commercial market with our sub-megawatt class
product in late 2001 and with our megawatt class products in 2002. Additional
information concerning us is included in our reports and other documents
incorporated by reference in this prospectus. See "Where You Can Find More
Information."
Our executive offices are located at 3 Great Pasture Road, Danbury,
Connecticut 06813. Our telephone number is (203) 825-6000.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Securities Exchange
Act of 1934 and, therefore, we file annual, quarterly and current reports, proxy
statements and other information with the SEC. You may read and copy any
document that we file at the SEC's public reference room at 450 Fifth Street,
N.W., Room 1024, Washington, D.C. 20549. Please call the SEC at 1-800-732-0330
for more information about its public reference rooms. Our SEC filings are also
available to the public from commercial document retrieval services and at the
web site that the SEC maintains at "http://www.sec.gov." Our common stock is
quoted on the Nasdaq National Market, and you may also inspect and copy our SEC
filings at the offices of the National Association of Securities Dealers, Inc.
located at 1735 K Street, N.W., Washington, D.C. 20549. This prospectus is part
of a registration statement on Form S-3 that we have filed with the SEC under
the Securities Act of 1933. This prospectus omits part of the registration
statement, as permitted by the rules and regulations of the SEC. You may inspect
and copy the registration statement, including exhibits, at the SEC's public
reference rooms or from its web site.
The SEC allows us to "incorporate by reference" the information 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
an important part of this prospectus and information that we file later with the
SEC will automatically update and supersede this information. Accordingly, we
incorporate by reference the documents listed below and any future filings we
make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934 prior to the termination of this offering:
o Our annual report on Form 10-K/A for the fiscal year ended October 31,
1999, as amended on February 7, 2000 and April 13, 2000.
o Our quarterly report on Form 10-Q for the quarter ended July 31, 2000.
o Our quarterly report on Form 10-Q for the quarter ended April 30,
2000.
o Our quarterly report on Form 10-Q for the quarter ended January 31,
2000.
o The description of our common stock contained in our registration
statement on Form 8-A, dated June 6, 2000, including any amendment to
that form that we may file in the future for the purpose of updating
the description of our common stock.
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o Our definitive proxy statement dated February 28, 2000, filed in
connection with our 2000 annual meeting of stockholders.
You may request a copy of these filings at no cost by writing or
telephoning the office of Joseph G. Mahler, FuelCell Energy, Inc., 3 Great
Pasture Road, Danbury, Connecticut 06813, telephone (203) 825-6000.
You should rely only on the information incorporated by reference or
provided in this prospectus, any prospectus supplement and the registration
statement. We have not authorized anyone else to provide you with different
information. We are not making an offer of these securities in any state where
the offer is not permitted. You should assume that the information in this
prospectus and any prospectus supplement, or incorporated by reference, is
accurate only as of the dates of those documents. Our business, financial
condition, results of operations and prospects may have changed since those
dates.
FORWARD-LOOKING STATEMENTS
This prospectus includes and incorporates by reference, and the
accompanying prospectus supplement may include, forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. Words such as "expects," "anticipates,"
"approximates," "believes," "estimates," "intends," and "hopes" and variations
of such words and similar expressions are intended to identify such
forward-looking statements. We intend such forward-looking statements, all of
which are qualified by this statement, to be covered by the safe harbor
provisions for forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995 and are including this statement for purposes of
complying with these safe harbor provisions. We have based these statements on
our current expectations and projections about future events. These
forward-looking statements are not guarantees of future performance and are
subject to risks and uncertainties that could cause actual results to differ
materially from those projected in these statements. These risks and
uncertainties include those set forth under "Risk Factors." The forward-looking
statements contained or incorporated by reference in this prospectus or the
accompanying prospectus supplement include, among others, statements about:
o the development and commercialization schedule for our fuel cell
technology and products;
o future funding under government research and development contracts;
o the expected cost competitiveness of our fuel cell technology and
products;
o our intellectual property;
o the timing and availability of our products;
o the electric power supply industry and the distributed generation
market;
o our business strategy; and
o general economic conditions in the electric power supply industry and
our target markets.
Except for our ongoing obligations to disclose material information under
the federal securities laws, we are not obligated to publicly update or revise
any forward-looking statements, whether as a result of new information, future
events or otherwise. In light of these risks, uncertainties and assumptions, the
forward-looking events discussed or incorporated by reference in this prospectus
or the accompanying prospectus supplement might not occur.
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RATIO OF EARNINGS TO FIXED CHARGES
The ratio of our earnings to fixed charges are set forth below for each of
the periods indicated.
NINE
MONTHS
ENDED FISCAL YEAR ENDED OCTOBER 31,
JULY 31, ----------------------------------------
2000(2) 1999(2) 1998(2) 1997 1996 1995
------- ------- ------- ---- ---- ----
Ratio of earnings to fixed -- -- -- 1.1 2.1 1.9
charges(1)
----------
(1) We do not have any preferred stock outstanding and consequently the ratio
of combined fixed charges and preference dividends to earnings is identical
to the ratio of earnings to fixed charges as of the date of this
prospectus.
(2) For the nine months ended July 31, 2000, and for the fiscal years ended
October 31, 1999 and 1998, our earnings were inadequate to cover fixed
charges. The coverage deficiencies were $106,000, $169,000 and $269,000,
respectively.
For purposes of calculating the ratios of earnings to fixed charges, (i)
fixed charges consist of interest on debt, amortization of discount on debt and
capitalized interest, and (ii) earnings consist of pre-tax income from
operations and fixed charges (excluding capitalized interest) and include the
amortization of capitalized interest.
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USE OF PROCEEDS
We intend to use the net proceeds from the sale of the securities offered
by us pursuant to this prospectus and any prospectus supplement for our general
corporate purposes, which may include the expansion of our manufacturing
facilities and other capital expenditures and working capital. The prospectus
supplement relating to a particular offering of securities by us will identify
the use of proceeds for that offering.
DIVIDEND POLICY
We have never paid a cash dividend on our common stock and do not
anticipate paying any cash dividends in the foreseeable future. As a result of
not collecting a dividend, there is a risk that stockholders will not experience
a return on their investment unless they sell their shares of common stock.
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DESCRIPTION OF DEBT SECURITIES
We may from time to time offer and sell debt securities (the "Debt
Securities"), consisting of debentures, notes and/or other unsecured evidences
of indebtedness. The Debt Securities will be either our unsecured senior debt
securities (the "Senior Debt Securities") or our unsecured subordinated debt
securities (the "Subordinated Debt Securities"). The Senior Debt Securities will
be issued under an Indenture (the "Senior Indenture") between us and a trustee
that will be identified in a prospectus supplement (the "Senior Trustee"). The
Senior Debt Securities will be our direct, unsecured obligations and will rank
equally with all of our outstanding unsecured senior indebtedness. The
Subordinated Debt Securities will be issued under a second indenture (the
"Subordinated Indenture") between us and a trustee that will be identified in a
prospectus supplement (the "Subordinated Trustee"), which may be the same as the
Senior Trustee. The Subordinated Debt Securities will be our direct, unsecured
obligations and, unless otherwise specified in the prospectus supplement
relating to a particular series of Subordinated Debt Securities offered by such
prospectus supplement, will be subject to the subordination provisions set forth
under the heading "Subordination of the Subordinated Debt Securities" below. The
Senior Indenture and the Subordinated Indenture are together called the
"Indentures" and the Senior Trustee and the Subordinated Trustee are together
called the "Trustee."
The following summary of certain provisions of the Indentures is not
complete. You should refer to the form of each Indenture, copies of which will
be filed as exhibits to the registration statement of which this prospectus is a
part.
The following section describes certain general terms and provisions of the
Debt Securities. The Debt Securities may be issued from time to time in one or
more series. The particular terms of each series of Debt Securities offered by
any prospectus supplement will be described in that prospectus supplement.
GENERAL. The Indentures do not limit the aggregate principal amount of Debt
Securities that we may issue. Each Indenture provides that Debt Securities of
any series may be issued under it up to the aggregate principal amount
authorized from time to time by us and may be denominated in any currency or
currency unit that we designate. We will determine the terms and conditions of
each series of Debt Securities, including the maturity, principal and interest,
but those terms must be consistent with the Indenture. Unless set forth in the
applicable prospectus supplement, neither the Indentures nor the Debt Securities
will limit or otherwise restrict the amount of other indebtedness that we may
incur or the other securities that we may issue.
The prospectus supplement relating to each series of Debt Securities being
offered will specify the particular terms of those Debt Securities. The terms
may include:
o the title of the Debt Securities and whether they are Senior Debt
Securities or Subordinated Debt Securities;
o any limit on the aggregate principal amount of the Debt Securities;
o the priority of payment of the Debt Securities, including any
subordination provisions;
o the price or prices (which may be expressed as a percentage of the
aggregate principal amount thereof) at which the Debt Securities will
be issued;
o the date or dates on which the principal and premium, if any, of the
Debt Securities are payable;
o the interest rate or rates (which may be fixed or variable) of the
Debt Securities, if any;
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o the interest payment date or dates, if any, or the method or methods
by which such dates may be determined, if any, the date or dates on
which payment of interest, if any, will commence, the date or dates
from which interest will accrue and the regular record dates for such
interest payment dates;
o the extent to which any of the Debt Securities will be issuable in
temporary or permanent global form, or the manner in which any
interest payable on a temporary or permanent Global Security (as
defined herein) will be paid;
o each office or agency where, subject to the terms of the applicable
Indenture, the Debt Securities may be presented for registration of
transfer or exchange;
o the place or places where, subject to the terms of the applicable
Indenture, the principal (and premium, if any) and interest, if any,
on the Debt Securities will be payable;
o the terms and conditions on which we may redeem any Debt Securities,
if at all;
o any obligation to redeem or purchase any Debt Securities and the terms
and conditions on which we must do so;
o the denomination or denominations in which the Debt Securities will be
issuable if other than $1,000 and integral multiples thereof;
o the currency, currencies or units based on or related to currencies
for which the Debt Securities may be purchased and the currency,
currencies or currency units in which the principal of, premium, if
any, and any interest on such Debt Securities may be payable;
o whether the Debt Securities will be convertible into shares of our
common stock or preferred stock, or other securities or property, and,
if so, the terms of such conversion;
o any index used to determine the amount of payments of principal of,
premium, if any, and interest on the Debt Securities;
o the payment of any additional amounts with respect to the Debt
Securities;
o whether any of the Debt Securities will be issued as Original Issue
Discount Securities (as defined below) and the terms and provisions
relating to these securities;
o information with respect to book-entry procedures relating to Global
Securities, if any;
o if applicable, that the Debt Securities are defeasible;
o any additional covenants or Events of Default not set forth in the
applicable Indenture or changes in the covenants or Events of Default
set forth in the applicable Indenture; and
o any other terms of the Debt Securities not inconsistent with the
provisions of the applicable Indenture.
Debt Securities may be issued as original issue discount Debt Securities
(bearing no interest or interest at a rate that at the time of issuance is below
market rates) ("Original Issue Discount Securities"), to be sold at a
substantial discount below their stated principal amount. There may not be any
periodic payments of interest on Original Issue Discount Securities. In the
event of an acceleration of the maturity of any Original Issue Discount
Security, the amount payable to the holder of such Original Issue Discount
Security upon such acceleration will be set forth in the prospectus supplement
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and determined in accordance with the terms of such security and the Indenture,
but will be an amount less than the amount payable at the maturity of the
principal of such Original Issue Discount Security. The federal income tax
considerations with respect to Original Issue Discount Securities will be
explained in the prospectus supplement we prepare for the Original Issue
Discount Securities.
CONVERSION AND EXCHANGE RIGHTS. The prospectus supplement will describe, if
applicable, the terms on which you may convert Debt Securities into or exchange
them for our common stock, our preferred stock or other securities or property.
The conversion or exchange may be mandatory or may be at your option. We will
describe how the number of shares of our common stock, our preferred stock or
other securities or property to be received upon conversion or exchange would be
calculated.
FORM, EXCHANGE AND TRANSFER. We will issue Debt Securities only in fully
registered form, without coupons, and, unless otherwise specified in the
prospectus supplement, only in denominations of $1,000 and integral multiples
thereof.
The holder of a Debt Security may elect, subject to the terms of the
Indentures and the limitations applicable to Global Securities, to exchange them
for other Debt Securities of the same series of any authorized denomination and
of a like tenor and aggregate principal amount.
Holders of Debt Securities may present them for exchange as provided above
or for registration of transfer, duly endorsed or with the form of transfer
endorsed thereon duly executed, at the office of the transfer agent we designate
for the purpose. We will not impose a service charge for any registration of
transfer or exchange of Debt Securities, but we may require a payment sufficient
to cover any tax or other governmental charge payable in connection with the
transfer exchange. We will name the transfer agent in the prospectus supplement.
We may designate additional transfer agents or rescind the designation of any
transfer agent or approve a change in the office through which any transfer
agent acts, but we must maintain a transfer agent in each place of payment for
the Debt Securities.
If we redeem the Debt Securities, we will not be required to issue,
register the transfer of or exchange any Debt Security during a specified period
prior to mailing a notice of redemption. We are not required to register the
transfer of or exchange any Debt Security selected for redemption, except the
unredeemed portion of the Debt Security being redeemed.
PAYMENT AND PAYING AGENTS. Unless otherwise stated in the prospectus
supplement, we will pay principal and any premium or interest on a Debt Security
to the person in whose name the Debt Security is registered at the close of
business on the regular record date for such interest.
Unless otherwise stated in the prospectus supplement, we will pay principal
and any premium or interest on the Debt Securities at the office of our
designated paying agent, except we may pay interest by check mailed to the
address of the person entitled to the payment. Unless we state otherwise in the
prospectus supplement, the corporate trust office of the Trustee will be the
paying agent for the Debt Securities.
Any other paying agents we designate for the Debt Securities of a
particular series will be named in the prospectus supplement. We may designate
additional paying agents, rescind the designation of any paying agent or approve
a change in the office through which any paying agent acts, but we must maintain
a paying agent in each place of payment for the Debt Securities.
The paying agent will return to us all money we pay to it for the payment
of the principal, premium or interest on any Debt Security that remains
unclaimed for a specified period. The holder thereafter may look only to us for
payment.
GLOBAL SECURITIES. The Debt Securities of any series may be represented by
one or more global securities (each, a "Global Security" and, together, the
"Global Securities") that will have an aggregate principal amount equal to that
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of the Debt Securities of that series. Each Global Security will be registered
in the name of a depositary identified in the prospectus supplement. We will
deposit the Global Security with the depositary or a custodian, and the Global
Security will bear a legend regarding the restrictions on exchanges and
registration of transfer.
No Global Security may be exchanged in whole or in part for Debt Securities
registered, and no transfer of a Global Security in whole or in part may be
registered, in the name of any person other than the depositary or any nominee
of the depositary unless (1) the depositary has notified us that it is unwilling
or unable to continue as depositary or (2) an event of default occurs and
continues with respect to the Debt Securities. The depositary will determine how
all securities issued in exchange for a Global Security will be registered.
As long as the depositary or its nominee is the registered holder of a
Global Security, the depositary or the nominee will be considered the sole owner
and holder of the Global Security and the underlying Debt Securities. Except as
stated above, owners of beneficial interests in a Global Security will not be
entitled to have the Global Security or any Debt Security registered in their
names, will not receive physical delivery of certificated Debt Securities and
will not be considered to be the owners or holders of the Global Security or
underlying Debt Securities. We will make all payments of principal, premium and
interest on a Global Security to the depositary or its nominee. The laws of some
jurisdictions require that certain purchasers of securities take physical
delivery of such securities in definitive form. These laws may prevent you from
transferring your beneficial interests in a Global Security.
Only institutions that have accounts with the depositary or its nominee and
persons that hold beneficial interests through the depositary or its nominee may
own beneficial interests in a Global Security. The depositary will credit, on
its book-entry registration and transfer system, the respective principal
amounts of Debt Securities represented by the Global Security to the accounts of
its participants. Ownership of beneficial interests in a Global Security will be
shown only on, and the transfer of those ownership interests will be effected
only through, records maintained by the depositary or any such participant.
The policies and procedures of the depositary may govern payments,
transfers, exchanges and other matters relating to beneficial interests in a
Global Security. We and the Trustee assume no responsibility or liability for
any aspect of the depositary's or any participant's records relating to, or for
payments made on account of, beneficial interests in a Global Security.
The specific terms of the depositary arrangement with respect to any series
of Debt Securities will be described in the applicable prospectus supplement.
CONSOLIDATION, MERGER AND SALE OF ASSETS. Each Indenture provides that we
may, without the consent of the holders of any of the Debt Securities
outstanding under the applicable Indenture, consolidate with, merge into or
transfer our assets substantially as an entirety to any person, provided that:
o any successor assumes our obligations on the applicable Debt
Securities and under the applicable Indenture;
o after giving effect to the transaction, there is no Default or Event
of Default that is continuing; and
o certain other conditions under the applicable Indenture are met.
Accordingly, such consolidation, merger or transfer of assets substantially
as an entirety, which meets the conditions described above, would not create any
Event of Default which would entitle holders of the Debt Securities, or the
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Trustee on their behalf, to take any of the actions described below under
"Events of Default."
LEVERAGED AND OTHER TRANSACTIONS. Unless otherwise specified in the
applicable prospectus supplement, the Indentures and the Debt Securities will
not contain, among other things, provisions that would protect holders of the
Debt Securities in the event of a highly leveraged or other transaction
involving us that could adversely affect the holders of Debt Securities.
MODIFICATION OF THE INDENTURES; WAIVER. Each Indenture provides that, with
the consent of the holders of not less than a majority in aggregate principal
amount of the outstanding Debt Securities of each affected series, modifications
and alterations of such Indenture may be made that affect the rights of the
holders of such Debt Securities. However, no such modification or alteration may
be made without the consent of the holder of each Debt Security so affected
which would, among other things:
o change the maturity of the principal of, or of any installment of
interest (or premium, if any) on, any Debt Security issued pursuant to
such Indenture;
o change the principal amount thereof, premium thereon, if any, or
interest thereon;
o change the method of calculation of interest or the currency of
payment of principal or interest (or premium, if any) thereon;
o reduce the minimum rate of interest thereon;
o impair the right to bring suit for the enforcement of any such payment
on or with respect to any such Debt Security;
o reduce the amount of principal of an Original Issue Discount Security
that would be due and payable upon an acceleration of the maturity
thereof;
o reduce the above-stated percentage in principal amount of outstanding
Debt Securities of any series required to modify or alter such
Indenture;
o in the case of Subordinated Debt Securities, modify the subordination
provisions in a manner materially adverse to their holders;
o in the case of Debt Securities that are convertible or exchangeable
into our other securities, adversely affect the right of holders to
convert or exchange any of the Debt Securities;
o reduce the percentage in principal amount of outstanding Debt
Securities of any series necessary for waiver of compliance with
certain provisions of the Indentures or for waiver of certain
defaults;
o modify provisions with respect to modification and waiver; or
o change our obligation to maintain an office or agency as required by
the applicable Indenture.
The holders of a majority in aggregate principal amount of the outstanding
Debt Securities of any series may waive, on behalf of the holders of all Debt
Securities of that series, our compliance with certain restrictive provisions of
the Indentures. Prior to the acceleration of the maturity of the Debt Securities
of any series outstanding under the Indentures, the holders of a majority in
aggregate principal amount of the outstanding Debt Securities of any series may
waive any past default under the Indenture with respect to Debt Securities of
that series, except a default (1) in the payment of principal, premium or
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interest on any Debt Security of that series or (2) in respect of a covenant or
provision of the Indenture that cannot be amended without each holder's consent.
Except in certain limited circumstances, we may set any day as a record
date for the purpose of determining the holders of outstanding Debt Securities
of any series entitled to give or take any direction, notice, consent, waiver or
other action under the Indentures. In certain limited circumstances, the Trustee
may set a record date for action by holders. To be effective, the action must be
taken by holders of the requisite principal amount of such Debt Securities
within a specified period following the record date.
EVENTS OF DEFAULT. An Event of Default with respect to the Debt Securities
of any series is defined in the applicable Indenture as:
o default in the payment of principal of or premium, if any, on any Debt
Security of that series when due, whether or not, in the case of
Subordinated Debt Securities, such payment is prohibited by the
Subordinated Indenture;
o default in the payment of interest on any Debt Security of that series
when due, which continues for 30 days, whether or not, in the case of
Subordinated Debt Securities, such payment is prohibited by the
Subordinated Indenture;
o failure to deposit any sinking fund payment, when due, in respect of
any Debt Security of that series, whether or not, in the case of
Subordinated Debt Securities, such payment is prohibited by the
subordination provisions of the Subordinated Indenture;
o default in the performance by us of any of our other covenants in the
applicable Indenture with respect to the Debt Securities of such
series, which continues for 90 days after written notice by the
Trustee or the holders of at least 25% in aggregate principal amount
of the Debt Securities of that series;
o certain events of bankruptcy, insolvency or reorganization affecting
us; and
o any other event that may be specified in a prospectus supplement with
respect to any series of Debt Securities.
If an Event of Default (other than an Event of Default relating to events
of bankruptcy, insolvency or reorganization) with respect to any series of Debt
Securities occurs and is continuing, either the Trustee or the holders of at
least 25% in aggregate principal amount of the Debt Securities of such series
outstanding may declare the principal amount (or if such Debt Securities are
Original Issue Discount Securities, such portion of the principal amount as may
be specified in the terms of that series) of all Debt Securities of that series
to be immediately due and payable. If an Event of Default relating to events of
bankruptcy, insolvency or reorganization with respect to the Debt Securities of
any series at the time outstanding shall occur, the principal amount of all the
Debt Securities of that series (or, in the case of any such Original Issue
Discount Security, such specified amount) will automatically, and without any
action by the applicable Trustee or any holder, become immediately due and
payable. After any such acceleration, but before a judgment or decree based on
acceleration, the holders of a majority in principal amount of the outstanding
Debt Securities of that series may, under certain circumstances, rescind and
annul such acceleration if all Events of Default, other than the non-payment of
accelerated principal (or other specified amount), have been cured or waived as
provided in the applicable Indenture. For information as to waiver of defaults,
see "Modification of the Indentures; Waiver."
If an Event of Default occurs and is continuing, the Trustee may, in its
discretion, and at the written request of holders of not less than a majority in
aggregate principal amount of the Debt Securities of any series, and upon
reasonable indemnity against the costs, expenses and liabilities to be incurred
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in compliance with such request and subject to certain other conditions set
forth in the applicable Indenture will, proceed to protect the rights of the
holders of all the Debt Securities of such series.
The Indentures provide that upon the occurrence of an Event of Default
relating to payments of principal of, premium, if any, or interest on any Debt
Security, we will, upon demand of the Trustee, pay to it, for the benefit of the
holder of any such Debt Security, the whole amount then due and payable on such
Debt Securities for principal, premium, if any, and interest. The Indentures
further provide that that if we fail to pay such amount upon such demand, the
Trustee may, among other things, institute a judicial proceeding for the
collection of the amount due.
No holder of a Debt Security of any series may institute any proceeding
with respect to the Indentures, or for the appointment of a receiver or a
trustee, or for other remedy, unless (1) the holder has previously given the
Trustee written notice of a continuing event of default, (2) the holders of at
least 25% in aggregate principal amount of the outstanding Debt Securities of
that series have made a written request, and the holders have offered reasonable
indemnity to the Trustee to institute the proceeding, and (3) the Trustee has
failed to institute the proceeding, and has not received a direction
inconsistent with the request within 60 days of such notice. The Indentures also
provide that, notwithstanding any other provision of the applicable Indenture,
the holder of any Debt Security of any series will have the right to institute
suit for the enforcement of any payment of principal of, premium, if any, and
interest on such Debt Securities when due and that such right will not be
impaired without the consent of such holder.
We are required to file annually with the applicable Trustee a written
statement as to the existence or non-existence of defaults under the Indentures
or the Debt Securities.
SUBORDINATION OF THE SUBORDINATED DEBT SECURITIES. The Subordinated Debt
Securities will be our direct, unsecured obligations and, unless otherwise
specified in the prospectus supplement relating to a particular series of
Subordinated Debt Securities offered by such prospectus supplement, will be
subject to the subordination provisions described in this section. Upon any
distribution of our assets due to any dissolution, winding up, liquidation or
reorganization, the payment of the principal of, premium, if any, and interest
on the Subordinated Debt Securities is to be subordinated in right of payment to
all Senior Indebtedness. In certain events of bankruptcy or insolvency, the
payment of the principal of and interest on the Subordinated Debt Securities
will, to the extent provided in the Subordinated Indenture, also be effectively
subordinated in right of payment to all General Obligations (as defined below).
Upon any distribution of our assets due to any dissolution, winding up,
liquidation or reorganization, the holders of Senior Indebtedness will first be
entitled to receive payment in full of all amounts due or to become due before
the holders of the Subordinated Debt Securities will be entitled to receive any
payment in respect of the Subordinated Debt Securities. If upon any such payment
or distribution of assets, after giving effect to such subordination provisions
in favor of the holders of Senior Indebtedness, (i) there remain any amounts of
cash, property or securities available for payment or distribution in respect of
the Subordinated Debt Securities ("Excess Proceeds") and (ii) if, at such time,
any creditors in respect of General Obligations have not received payment in
full of all amounts due or to become due on or in respect of such General
Obligations, then such Excess Proceeds will first be applied to pay or provide
for the payment in full of such General Obligations before any payment or
distribution may be made in respect of the Subordinated Debt Securities.
In addition, no payment may be made on the Subordinated Debt Securities, or
in respect of any redemption, retirement, purchase or other acquisition of any
of the Subordinated Debt Securities, at any time in the event:
o there is a default in the payment of the principal of, premium, if
any, interest on or otherwise in respect of any Senior Indebtedness;
or
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o any event of default with respect to any Senior Indebtedness has
occurred and is continuing or would occur as a result of such payment
on the Subordinated Debt Securities or any redemption, retirement,
purchase or other acquisition of any of the Subordinated Debt
Securities, permitting the holders of such Senior Indebtedness to
accelerate the maturity thereof.
Except as described above, our obligation to make payments of the principal
of, premium, if any, or interest on the Subordinated Debt Securities will not be
affected.
By reason of the subordination in favor of the holders of Senior
Indebtedness, in the event of a distribution of assets upon any dissolution,
winding up, liquidation or reorganization, our creditors who are not holders of
Senior Indebtedness or the Subordinated Debt Securities may recover less,
proportionately, than holders of Senior Indebtedness and may recover more,
proportionately, than holders of the Subordinated Debt Securities.
Subject to payment in full of all Senior Indebtedness, the holders of
Subordinated Debt Securities will be subrogated to the rights of the holders of
Senior Indebtedness to receive payments or distributions of cash, property or
our securities applicable to Senior Indebtedness. Subject to payment in full of
all General Obligations, the holders of the Subordinated Debt Securities will be
subrogated to the rights of the creditors in respect of General Obligations to
receive payments or distributions of cash, property or our securities applicable
to such creditors in respect of General Obligations.
"Senior Indebtedness" for purposes of the Subordinated Indenture is the
principal of, premium, if any, and interest on:
o all of our indebtedness for money borrowed (other than (i) the
Subordinated Debt Securities and (ii) the Junior Subordinated
Indebtedness (as defined below)) whether outstanding on the date of
execution of the Subordinated Indenture or created, assumed or
incurred after that date, except such indebtedness as is by its terms
expressly stated to be not superior in right of payment to the
Subordinated Debt Securities or to rank equally with the Subordinated
Debt Securities; and
o any deferrals, renewals or extensions of any such Senior Indebtedness.
The term "indebtedness for money borrowed" as used in this prospectus
includes, without limitation, any obligation of, or any obligation guaranteed by
us for the repayment of borrowed money, whether or not evidenced by bonds,
debentures, notes or other written instruments, and any deferred obligation for
the payment of the purchase price of property or assets. The Subordinated
Indenture does not limit our issuance of additional Senior Indebtedness.
The Subordinated Debt Securities will rank senior in right of payment to
our Junior Subordinated Indebtedness upon any distribution of our assets due to
any dissolution, winding up, liquidation or reorganization, to the extent
provided in the instruments creating our Junior Subordinated Indebtedness.
"Junior Subordinated Indebtedness" is the principal of, premium, if any, and
interest on:
o all of our indebtedness for money borrowed whether outstanding on the
date of the execution of the Subordinated Indenture or created,
assumed or incurred after that date that is by its terms subordinated
to the Subordinated Debt Securities; and
o any deferrals, renewals or extensions of any of such Junior
Subordinated Indebtedness.
Unless otherwise specified in the prospectus supplement relating to a
particular series of Subordinated Debt Securities offered thereby, the term
"General Obligations" means all obligations to make payment on account of claims
in respect of derivative products such as interest and foreign exchange rate
contracts, commodity contracts and similar arrangements, other than:
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o obligations on account of Senior Indebtedness;
o obligations on account of indebtedness for money borrowed ranking
equal with or subordinate to the Subordinated Debt Securities; and
o obligations which by their terms are expressly stated not to be senior
in right of payment to the Subordinated Debt Securities or to rank
equally with the Subordinated Debt Securities.
Unless otherwise specified in the prospectus supplement relating to any
series of Subordinated Debt Securities, payment of principal of the Subordinated
Debt Securities may be accelerated only in case of the bankruptcy, insolvency or
reorganization of our company.
DEFEASANCE AND COVENANT DEFEASANCE. To the extent stated in the prospectus
supplement, we may elect to apply the provisions relating to defeasance and
discharge of indebtedness, or to defeasance of certain restrictive covenants in
the Indentures, to the Debt Securities of any series.
DESCRIPTION OF PREFERRED STOCK
This section describes the general terms of our preferred stock, $0.01 par
value, to which any prospectus supplement may relate. Certain terms of any
series of our preferred stock offered by any prospectus supplement will be
described in such prospectus supplement. If so indicated in the prospectus
supplement, the terms of that series may differ from the terms described below.
The provisions of our preferred stock described below are not complete. You
should refer to our certificate of incorporation and any certificate of
amendment to our certificate of incorporation or certificate of designations
filed with the SEC in connection with the offering of our preferred stock.
GENERAL. Under our certificate of incorporation, our board of directors has
the authority, without further stockholder action, to issue from time to time
preferred stock in one or more series and for such consideration as may be fixed
from time to time by our board of directors. Our board also has the authority to
fix and determine, in the manner provided by law, the relative rights and
preferences of the shares of any series so established, such as dividend and
voting rights. Our certificate of incorporation authorizes 250,000 shares of
undesignated preferred stock. Prior to the issuance of each series of preferred
stock, our board of directors will adopt resolutions creating and designating
the series as a series of preferred stock.
Our preferred stock will have the dividend, liquidation, redemption, voting
and conversion rights set forth below unless otherwise specified in the
applicable prospectus supplement. You should read the prospectus supplement
relating to the particular series of preferred stock offered thereby for
specific terms, including:
o the designation, stated value and liquidation preference of such
preferred stock and the number of shares offered;
o the initial public offering price at which the preferred stock will be
issued;
o the dividend rate or rates (or method of calculation), the dividend
periods, the date on which dividends will be payable and whether such
dividends will be cumulative or noncumulative and, if cumulative, the
dates from which dividends will begin to cumulate;
o any redemption or sinking fund provisions;
o any conversion provisions; and
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o any additional rights, preferences, privileges, qualifications,
limitations and restrictions of the preferred stock.
No shares of our preferred stock are currently outstanding. Our preferred
stock will, when issued, be fully paid and nonassessable and have no preemptive
rights. Unless otherwise specified in the applicable prospectus supplement, the
shares of each series of preferred stock will upon issuance rank equally in all
respects with each other then outstanding series of preferred stock.
Preferred stock could be issued quickly with terms that could delay or
prevent a change of control or make the removal of management more difficult.
Additionally, the issuance of preferred stock may decrease the market price of
our common stock and may adversely affect the voting and other rights of the
holders of our common stock.
RANK. Any series of our preferred stock will, with respect to dividend
rights and rights on liquidation, winding up or dissolution, rank:
o senior to all classes of our common stock and to all equity securities
issued by us, the terms of which specifically provide that the equity
securities will rank junior to that preferred stock;
o equally with all equity securities issued by us, the terms of which
specifically provide that the equity securities will rank equally with
that preferred stock; and
o junior to all equity securities issued by us, the terms of which
specifically provide that the equity securities will rank senior to
that preferred stock.
DIVIDENDS. The holders of our preferred stock will be entitled to receive,
when, as and if declared by our board of directors, dividends at such rates and
on such dates as will be specified in the applicable prospectus supplement. Such
rates may be fixed or variable or both. If variable, the formula used for
determining the dividend rate for each dividend period will be specified in the
applicable prospectus supplement. Dividends will be payable to the holders of
record as they appear on our stock books on such record dates as will be fixed
by our board. Dividends may be paid in the form of cash, preferred stock (of the
same or a different series) or our common stock, in each case as specified in
the applicable prospectus supplement.
Dividends on any series of our preferred stock may be cumulative or
noncumulative, as specified in the applicable prospectus supplement. If the
dividends on a series of our preferred stock are noncumulative ("Noncumulative
Preferred Stock"), and our board of directors fails to declare a dividend
payable on a dividend payment date, then the holders of such preferred stock
will have no right to receive a dividend in respect to the dividend period
relating to such dividend payment date, and we will not be obligated to pay the
dividend accrued for such period, whether or not dividends on such preferred
stock are declared or paid on any future dividend payment dates.
We will not declare or pay or set apart for payment any dividends on any
series of our preferred stock that rank, as to dividends, on a parity with or
junior to the outstanding preferred stock of any series unless (i) if such
outstanding preferred stock has a cumulative dividend ("Cumulative Preferred
Stock"), full cumulative dividends have been or contemporaneously are declared
and paid or declared and a sum sufficient for the payment thereof set apart for
such payment on such preferred stock for all dividend periods terminating on or
prior to the date of payment of any such dividends on such other series of the
preferred stock or (ii) if such outstanding preferred stock is Noncumulative
Preferred Stock, full dividends for the then-current dividend period on such
preferred stock have been or contemporaneously are declared and paid or declared
and a sum sufficient for the payment thereof set apart for such payment.
Until full dividends are paid (or declared and payment is set aside) on our
preferred stock ranking equal as to dividends, then:
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o we will declare any dividends pro rata among the preferred stock of
each series and any preferred stock ranking equal to such preferred
stock as to dividends (i.e., the dividends we declare per share on
each series of such preferred stock will bear the same relationship to
each other that the full accrued dividends per share on each such
series of the preferred stock (which will not, if such preferred stock
is Noncumulative Preferred Stock, include any accumulation in respect
to unpaid dividends for prior dividend periods) bear to each other);
o other than such pro rata dividends, we will not declare or pay any
dividends or declare or make any distributions upon any security
ranking junior to or equal with the preferred stock as to dividends or
upon liquidation (except dividends on common stock payable in common
stock, dividends or distributions paid for with securities ranking
junior to the preferred stock as to dividends and upon liquidation and
cash in lieu of fractional shares in connection with such dividends);
and
o we will not redeem, purchase or otherwise acquire (or set aside money
for a sinking fund for) our common stock or any other securities
ranking junior to or equal with the preferred stock as to dividends or
upon liquidation (except by conversion into or exchange for stock
junior to the preferred stock as to dividends and upon liquidation).
We will not owe any interest, or any money in lieu of interest, on any
dividend payment on any series of the preferred stock that may be past due.
REDEMPTION. A series of our preferred stock may be redeemable, in whole or
in part, at our option, and may be subject to mandatory redemption pursuant to a
sinking fund or otherwise, in each case upon terms, at the times and at the
redemption prices specified in the applicable prospectus supplement. Redeemed
shares of our preferred stock will become authorized but unissued shares of
preferred stock that we may issue in the future.
The prospectus supplement relating to a series of our preferred stock that
is subject to mandatory redemption will specify the number of shares of such
preferred stock that we will redeem each year and the redemption price per
share. If shares of our preferred stock are redeemed, we will pay all accrued
and unpaid dividends thereon (which will not, if such preferred stock is
Noncumulative Preferred Stock, include any accumulation in respect of unpaid
dividends for prior dividend periods) up to but excluding the date of
redemption. The redemption price may be payable in cash or other property, as
specified in the applicable prospectus supplement. If the redemption price for
our preferred stock of any series is payable only from the net proceeds of the
issuance of our capital stock, the terms of such preferred stock may provide
that, if no such capital stock will have been issued or to the extent the net
proceeds from any issuance are insufficient to pay in full the aggregate
redemption price then due, such preferred stock will automatically and
mandatorily be converted into shares of our applicable capital stock pursuant to
conversion provisions specified in the applicable prospectus supplement.
If fewer than all the outstanding shares of our preferred stock of any
series are to be redeemed, our board will determine the number of shares to be
redeemed. We will redeem the shares pro rata from the holders of record of such
shares in proportion to the number of such shares held by such holders (with
adjustments to avoid redemption of fractional shares) or by lot or by any other
method as may be determined by our board.
Even though the terms of a series of the Cumulative Preferred Stock may
permit redemption of such preferred stock in whole or in part, if any dividends,
including accumulated dividends, on that series are past due:
o we will not redeem any preferred stock of that series unless we
simultaneously redeem all outstanding preferred stock of that series;
and
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o we will not purchase or otherwise acquire any preferred stock of that
series.
The prohibition discussed in the preceding sentence will not prohibit us
from purchasing or acquiring preferred stock of that series pursuant to a
purchase or exchange offer if we make the offer on the same terms to all holders
of that series.
CONVERSION RIGHTS. The prospectus supplement relating to a series of
convertible preferred stock will describe the terms on which shares of such
series are convertible into our common stock.
RIGHTS UPON LIQUIDATION. Unless the applicable prospectus supplement states
otherwise, if we voluntarily or involuntarily liquidate, dissolve or wind up our
business, the holders of our preferred stock will be entitled to receive out of
our assets available for distribution to stockholders, before any distribution
of assets is made to holders of our common stock or any other class or series of
shares ranking junior to such preferred stock upon liquidation, liquidating
distributions in the amount of the liquidation preference of such preferred
stock plus accrued and unpaid dividends (which will not, if such preferred stock
is Noncumulative Preferred Stock, include any accumulation in respect of unpaid
dividends for prior dividend periods). If we voluntarily or involuntarily
liquidate, dissolve or wind up our business and the amounts payable with respect
to our preferred stock of any series and any of our other securities ranking
equal as to any such distribution are not paid in full, the holders of such
preferred stock and of such other shares will share ratably in any such
distribution of our assets in proportion to the full respective preferential
amounts to which they are entitled. After payment of the full amount of the
liquidating distribution to which they are entitled, the holders of our
preferred stock of any series will not be entitled to any further participation
in any distribution of our assets.
VOTING RIGHTS. Except as described in this section or in the applicable
prospectus supplement, or except as expressly required by applicable law, the
holders of our preferred stock will not be entitled to vote. If the holders of a
series of our preferred stock are entitled to vote and the applicable prospectus
supplement does not state otherwise, each such share will be entitled to one
vote on matters on which holders of such series of preferred stock are entitled
to vote. For any series of our preferred stock having one vote per share, the
voting power of such series, on matters on which holders of such series and
holders of other series of our preferred stock are entitled to vote as a single
class, will depend on the number of shares in such series, not the aggregate
stated value, liquidation preference or initial offering price of the shares of
such series of preferred stock.
Unless we receive the consent of the holders of an outstanding series of
preferred stock and the outstanding shares of all other series of preferred
stock which (i) rank equal with such series either as to dividends or the
distribution of assets upon liquidation, dissolution or winding up of our
business and (ii) have voting rights that are exercisable and that are similar
to those of such series, we will not:
o authorize, create or issue, or increase the authorized or issued
amount of, any class or series of stock ranking prior to such
outstanding preferred stock with respect to payment of dividends or
the distribution of assets upon liquidation, dissolution or winding up
of our business; or
o amend, alter or repeal, whether by merger, consolidation or otherwise,
the provisions of our certificate or of the resolutions contained in
any certificate of designations creating such series of preferred
stock so as to materially and adversely affect any right, preference
privilege or voting power of such outstanding preferred stock.
This consent must be given by the holders of a majority of all such
outstanding preferred stock described in the preceding sentence, voting together
as a single class. We will not be required to obtain this consent with respect
to the actions listed in the second bullet point above, however, if we only (i)
increase the amount of the authorized preferred stock, (ii) create and issue
another series of preferred stock, or (iii) increase the amount of authorized
shares of any series of preferred stock, if such preferred stock in each case
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ranks equal with or junior to the preferred stock with respect to the payment of
dividends and the distribution of assets upon liquidation, dissolution or
winding up of our business.
DESCRIPTION OF COMMON STOCK
This section describes the general terms and provisions of the shares of
our common stock, par value $0.0001 per share. The summary is not complete and
is qualified in its entirety by reference to the description of our common stock
incorporated by reference in this prospectus. We have also filed our certificate
of incorporation and our bylaws as exhibits to the registration statement, of
which this prospectus is a part. You should read our certificate of
incorporation and our bylaws for additional information before you buy any of
our common stock. See "Where You Can Find More Information."
GENERAL. As of September 30, 2000, our authorized common stock was
20,000,000 shares, of which 15,708,962 shares were issued and outstanding. On
November 21, 2000, there will be a Special Meeting of our stockholders to adopt
an amendment to our certificate of incorporation to increase our authorized
common stock to 150,000,000 shares.
VOTING RIGHTS. The holders of our common stock have one vote per share.
Holders of our common stock are not entitled to vote cumulatively for the
election of directors. Generally, all matters to be voted on by stockholders
must be approved by a majority, or, in the case of the election of directors, by
a plurality, of the votes entitled to be cast at a meeting at which a quorum is
present by all shares of common stock present in person or represented by proxy,
voting together as a single class, subject to any voting rights granted to
holders of any then outstanding preferred stock.
DIVIDENDS. Holders of common stock will share ratably in any dividends
declared by the board of directors, subject to the preferential rights of any
preferred stock then outstanding. Dividends consisting of shares of common stock
may be paid to holders of shares of common stock.
OTHER RIGHTS. In the event of liquidation, dissolution or winding up, after
payment of liabilities and liquidation preferences on any shares of preferred
stock then outstanding, the holders of common stock are entitled to share
ratably in all assets available for distribution. Holders of common stock have
no preemptive rights or rights to convert their common stock into any other
securities. There are no redemption or sinking fund provisions applicable to the
common stock.
ANTI-TAKEOVER PROVISIONS
CERTAIN PROVISIONS OF OUR CERTIFICATE OF INCORPORATION AND BY-LAWS MAY HAVE
ANTI-TAKEOVER EFFECTS. A number of provisions of our certificate of
incorporation and by-laws concern matters of corporate governance and the rights
of stockholders. Some of these provisions, including, but not limited to, the
inability of stockholders to take action by unanimous written consent,
supermajority voting provisions with respect to any amendment of voting rights
provisions, the filling of vacancies on the board of directors by the
affirmative vote of a majority of the remaining directors, and the ability of
the board of directors to issue shares of preferred stock and to set the voting
rights, preferences and other terms thereof, without further stockholder action,
may be deemed to have anti-takeover effect and may discourage takeover attempts
not first approved by the board of directors, including takeovers which
stockholders may deem to be in their best interests. If takeover attempts are
discouraged, temporary fluctuations in the market price of our common stock,
which may result from actual or rumored takeover attempts, may be inhibited.
These provisions, together with the ability of the board of directors to issue
preferred stock without further stockholder action, could also delay or
frustrate the removal of incumbent directors or the assumption of control by
stockholders, even if the removal or assumption would be beneficial to our
stockholders. These provisions could also discourage or inhibit a merger, tender
offer or proxy contest, even if favorable to the interests of stockholders, and
could depress the market price of our common stock. The board of directors
believes these provisions are appropriate to protect our interests and the
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interests of our stockholders. The board of directors has no present plans to
adopt any further measures or devices which may be deemed to have an
"anti-takeover effect."
DELAWARE ANTI-TAKEOVER PROVISIONS. We are subject to Section 203 of the
Delaware General Corporation Law, which prohibit a publicly-held Delaware
corporation from engaging in a "business combination," except under certain
circumstances, with an "interested stockholder" for a period of three years
following the date such person became an "interested stockholder" unless:
o before such person became an interested stockholder, the board of
directors of the corporation approved either the business combination or the
transaction that resulted in the interested stockholder becoming an interested
stockholder;
o upon the consummation of the transaction that resulted in the interested
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 shares held by directors who are also officers
of the corporation and shares held by employee stock plans; or
o at or following the time such person became an interested stockholder,
the business combination is approved by the board of directors of the
corporation and authorized at a meeting of stockholders by the affirmative vote
of the holders of 66-2/3% of the outstanding vote stock of the corporation which
is not owned by the interested stockholder.
The term "interested stockholder" generally is defined as a person who,
together with affiliates and associates, owns, or, within the three years prior
to the determination of interested stockholder status, owned, 15% or more of a
corporation's outstanding voting stock. The term "business combination" includes
mergers, asset or stock sales and other similar transactions resulting in a
financial benefit to an interested stockholder. Section 203 makes it more
difficult for an "interested stockholder" to effect various business
combinations with a corporation for a three-year period. The existence of this
provision would be expected to have an anti-takeover effect with respect to
transactions not approved in advance by the board of directors, including
discouraging attempts that might result in a premium over the market price for
the shares of common stock held by stockholders. A Delaware corporation may "opt
out" of Section 203 with an express provision in its original certificate of
incorporation or any amendment thereto. Our certificate of incorporation does
not contain any such exclusion.
CONNECTICUT ANTI-TAKEOVER PROVISIONS. The laws of the State of Connecticut,
where our principal executive offices are located, impose restrictions on
certain transactions between certain foreign corporations and significant
stockholders. Section 33-840 of the Connecticut Business Corporation Act
prohibits certain publicly-held foreign corporations that are based in
Connecticut from engaging in a "business combination" (including the issuance of
equity securities which have an aggregate market value of 5% or more of the
total market value of the outstanding shares of the company) with an "interested
stockholder" as defined in the Connecticut Business Corporation Act for a period
of five years from the date of the stockholder's purchase of stock, unless
approved in a prescribed manner. The application of this statute could prevent a
change of control. Generally, approval is required by the board of directors, by
a majority of our non-employee directors by 80% of the outstanding voting shares
and two-thirds of the voting power of the outstanding shares of the voting stock
other than shares held by the interested stockholder. We can give no assurance
that these provisions would not prevent us from entering into a business
combination that otherwise would be beneficial to us or to our stockholders.
TRANSFER AGENT AND REGISTRAR. The transfer agent and registrar for our
common stock is Continental Stock Transfer & Trust Company, New York, New York.
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PLAN OF DISTRIBUTION
GENERAL. We may sell the securities offered by this prospectus in any of
three ways:
o through underwriters;
o through agents; or
o directly to a limited number of institutional purchases or to a single
purchaser.
The prospectus supplement for the securities we sell will describe that
offering, including:
o the name or names of any underwriters;
o the purchase price and the proceeds to us from that sale;
o any underwriting discounts and other items constituting underwriters'
compensation; and
o any initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers.
UNDERWRITERS. If underwriters are used in the sale, we will execute an
underwriting agreement with those underwriters relating to the securities that
we will offer. Unless otherwise provided in the applicable prospectus
supplement, the obligations of the underwriters to purchase these securities
will be subject to conditions. The underwriters will be obligated to purchase
all of these securities if any are purchased.
The securities subject to the underwriting agreement will be acquired by
the underwriters for their own account and may be resold by them from time to
time in one or more transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time of sale.
Underwriters may be deemed to have received compensation from us in the form of
underwriting discounts or commissions and may also receive commissions from the
purchasers of these securities for whom they may act as agent. Underwriters may
sell these securities to or through dealers. These dealers may receive
compensation in the form of discounts, concessions or commissions from the
underwriters or commissions from the purchasers for whom they may act as agent.
Any initial public offering price and any discounts or concessions allowed or
reallowed or paid to dealers may be changed from time to time.
We also may sell the securities in connection with a remarketing upon their
purchase, in connection with a redemption or repayment, by a remarketing firm
acting as principal for its own account or as our agent. Remarketing firms may
be deemed to be underwriters in connection with the securities that they
remarket.
We may authorize underwriters to solicit offers by institutions to purchase
the securities subject to the underwriting or terms agreement from us at the
public offering price stated in the prospectus supplement under delayed delivery
contracts providing for payment and delivery on a specified date in the future.
If we sell securities under these delayed delivery contracts, the prospectus
supplement will state that as well as the conditions to which these delayed
delivery contracts will be subject and the commissions payable for that
solicitation.
During and after an offering through underwriters, the underwriters may
purchase and sell the securities in the open market. These transactions may
include overallotment and stabilizing transactions and purchases to convey
syndicate short positions created in connection with the offering. The
underwriters may also impose a penalty bid, which means that selling concessions
allowed to syndicate members or other broker-dealers for the offered securities
sold for their account may be reclaimed by the syndicate if the offered
securities are repurchased by the syndicate in stabilizing or covering
transactions. These activities may stabilize, maintain or otherwise affect the
market price of the offered securities, which may be higher than the price that
might otherwise prevail in the open market. If commenced, the underwriters may
discontinue these activities at any time.
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AGENTS. We may also sell any of the securities through agents designated by
us from time to time. We will name any agent involved in the offer or sale of
these securities and will list commissions payable by us to these agents in the
prospectus supplement. These agents will be acting on a best efforts basis to
solicit purchases for the period of their appointment, unless we state otherwise
in the applicable prospectus supplement.
DIRECT SALES. We may sell any of the securities directly to purchasers. In
this case, we will not engage underwriters or agents in the offer and sale of
these securities.
INDEMNIFICATION. We may indemnify underwriters, dealers or agents who
participate in the distribution of the securities against certain liabilities,
including liabilities under the Securities Act of 1933, and agree to contribute
to payments which these underwriters, dealers or agents may be required to make.
LISTING. Except as indicated in the applicable prospectus supplement, the
securities are not expected to be listed on any securities exchange, except for
our common stock, which is quoted on the Nasdaq National Market, and any
underwriters or dealers will not be obligated to make a market in these
securities. We cannot predict the activity or liquidity of any trading in these
securities.
LEGAL MATTERS
Our counsel, Robinson & Cole LLP, Stamford, Connecticut, has issued an
opinion on the validity of the offered securities.
EXPERTS
The consolidated financial statements of FuelCell Energy, Inc. as of
October 31, 1999 and 1998 and for each of the years in the three-year period
ended October 31, 1999 have been incorporated by reference in this prospectus in
reliance upon the report of KPMG LLP, independent public accountants,
incorporated by reference and upon the authority of that firm as experts in
accounting and auditing.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth all expenses payable by the registrant,
other than underwriting discounts, in connection with the offering of the
securities being registered.
SEC Registration Fee..........................................$ 66,000
Nasdaq National Market Listing Fee*...........................$_______
Trustees' Fees and Expenses*..................................$_______
Transfer Agent and Registrar Fees*............................$_______
Blue Sky Qualification Fees and Expenses......................$ 5,000
Printing Fees*................................................$_______
Accounting Fees and Expenses*.................................$_______
Legal Fees and Expenses*......................................$_______
Miscellaneous Expenses*.......................................$_______
--------
Total*.......................................................$________
==========
* Estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law provides that a
corporation may indemnify any person, including an officer and director, who was
or is, or is threatened to be made, a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of such cooperation), by
reason of the fact that such person is or was a director, officer, employee or
agent of such corporation, or is or was serving at the request of such
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise. The indemnity may include
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by such person in connection with
such action, suit or proceeding, 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 such corporation, and, with respect to any criminal actions and
proceedings, had no reasonable cause to believe that his conduct was unlawful. A
Delaware corporation may indemnify any person, including an officer or director,
who was or is, or is threatened to be made, a party to any threatened, pending
or contemplated action or suit by or in the right of such corporation, under the
same conditions, except that no indemnification is permitted without judicial
approval if such person is adjudged to be liable to such corporation. Where an
officer or director of a corporation is successful, on the merits or otherwise,
in the defense of any action, suit or proceeding referred to above, or any
claim, issue or matter herein, the corporation must indemnify such person
against the expenses (including attorneys' fees) which such officer or director
actually and reasonably incurred in connection therewith.
The registrant's certificate of incorporation provides that none of our
directors will be personally liable to us or our stockholders for monetary
damages for breach of fiduciary duty as a director, except to the extent such
exemption from liability or limitation thereof is not permitted under the
Delaware General Corporation Law as currently in effect or as the same may
hereafter be amended.
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Pursuant to Section 102(b) (7) of the Delaware General Corporation Law, the
registrant's certificate of incorporation eliminates the liability of our
directors to us or our stockholders, except for liabilities related to breach of
duty of loyalty, actions not in good faith and certain other liabilities.
The registrant maintains directors' and officers' liability insurance
policies. The registrant's by-laws provide for indemnification of the
registrant's officers and directors to the fullest extent permitted by
applicable law.
ITEM 16. EXHIBITS
EXHIBIT PAGE
NUMBER DESCRIPTION OF EXHIBITS NUMBER
1.1 Form of Underwriting Agreement*........................................
4.1 Certificate of Incorporation of the registrant, as amended
(incorporated by reference to Exhibit 3.1 to the registrant's
Current Report on Form 8-K dated September 21, 1999)
4.2 Restated Bylaws of the registrant, as amended (incorporated by
reference to Exhibit 3.2 to the registrant's Current Report on
Form 8-K dated September 21, 1999)
4.3 Specimen of Common Stock Certificate (incorporated by reference
to Exhibit 4 contained in the registrant's Annual Report on Form
10-K for the fiscal year ended October 31, 1999)
4.4 Form of Senior Indenture*..............................................
4.5 Form of Subordinated Indenture*........................................
4.6 Form of Senior Debt Security*..........................................
4.7 Form of Subordinated Debt Security*....................................
5.1 Opinion of Robinson & Cole LLP......................................... 40
12.1 Statement regarding computation of ratio of earnings to fixed
charges................................................................ 43
23.1 Consent of KPMG LLP.................................................... 44
23.2 Consent of Robinson & Cole LLP (included in Exhibit 5.1)...............
24.1 Power of Attorney (included on signature page of this
Registration Statement)
25.1 Statement of Eligibility and Qualification on Form T-1 of
Trustee*...............................................................
---------------------------
*To be filed by amendment or as an exhibit to a report pursuant to Section
13(a), 13(c) or 15(d) of the Securities Exchange Act of 1934.
ITEM 17. UNDERTAKINGS
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 the foregoing provisions, 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
of 1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
The undersigned Registrant hereby undertakes:
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(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement: (i) to
include any prospectus required by Section 10(a)(3) of the Securities
Act of 1933; (ii) to reflect in the prospectus any facts or events
arising after the effective date of the Registration Statement (or the
most recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the information
set forth in the Registration Statement; notwithstanding the
foregoing, any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement; (iii) to include any material information with respect to
the plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement; provided, however, that provisions (i) and
(ii) do not apply if the information required to be included in a
post-effective amendment by those provisions is contained in periodic
reports filed with or furnished to the Securities and Exchange
Commission by the Registrant pursuant to Sections 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 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 that remain unsold at the
termination of the offering.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of Registrant's annual report pursuant to
Section 13(a) or Section 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 Securities Exchange Act
of 1934) 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) To file an application for the purpose of determining the eligibility
of the trustee to act under subsection (a) of Section 310 of the Trust
Indenture Act in accordance with the rules and regulations prescribed
by the Securities and Exchange Commission under Section 305(b)(2) of
the Trust Indenture Act.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Danbury, State of Connecticut, on October 20, 2000.
FUELCELL ENERGY, INC.
By: /s/ Jerry D. Leitman
--------------------------------------
Jerry D. Leitman
President and Chief Executive Officer
Such person whose signature appears below hereby appoints Jerry D. Leitman
and Joseph G. Mahler, and each of them, each of whom may act without joinder of
the other, as his or her true and lawful attorney-in-fact and agent, with full
power of substitution and resubstitution, for him or her and in his or her name,
place and stead, in any and all capacities, to execute in the name and on behalf
of such person any amendment or any post-effective amendment to this
Registration Statement, and any registration statement relating to any offering
made in connection with the offering covered by this Registration Statement that
is to be effective on filing pursuant to Rule 462(b) under the Securities Act of
1933, as amended, 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 full power and authority to do
and perform each and every act and thing appropriate or necessary to be done, as
fully and for all intents and purposes as he or she might or could do in person,
hereby ratifying and confirming all that said attorneys-in-fact and agents or
their substitute or substitutes may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on October 20, 2000.
SIGNATURE TITLE DATE
/s/ Jerry D. Leitman President, Chief October 20, 2000
--------------------------- Executive Officer and Director
Jerry D. Leitman (Principal Executive Officer)
/s/ Joseph G. Mahler Chief Financial Officer, Vice October 20, 2000
--------------------------- President, Corporate Secretary
Joseph G. Mahler and Treasurer (Principal
Accounting and Financial Officer)
/s/ Warren D. Bagatelle Director October 20, 2000
---------------------------
Warren D. Bagatelle
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/s/ Christopher R. Bentley Director October 20, 2000
---------------------------
Christopher R. Bentley
/s/ Michael Bode Director October 20, 2000
---------------------------
Michael Bode
Director October __, 2000
---------------------------
James D. Gerson
/s/ Thomas L. Kempner Director October 20, 2000
---------------------------
Thomas L. Kempner
/s/ William A. Lawson Director October 20, 2000
---------------------------
William A. Lawson
/s/ Hans Maru Director October 20, 2000
---------------------------
Hans Maru
/s/ Bernard Baker Director October 20, 2000
---------------------------
Bernard Baker
Director October __, 2000
---------------------------
John A. Rolls
/s/ Thomas R. Casten Director October 20, 2000
---------------------------
Thomas R. Casten
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EXHIBIT INDEX
EXHIBIT PAGE
NUMBER DESCRIPTION OF EXHIBITS NUMBER
1.1 Form of Underwriting Agreement*........................................
4.1 Certificate of Incorporation of the registrant, as amended
(incorporated by reference to Exhibit 3.1 to the registrant's
Current Report on Form 8-K dated September 21, 1999)
4.2 Restated Bylaws of the registrant, as amended (incorporated by
reference to Exhibit 3.2 to the registrant's Current Report on
Form 8-K dated September 21, 1999)
4.3 Specimen of Common Stock Certificate (incorporated by reference
to Exhibit 4 contained in the registrant's Annual Report on Form
10-K for the fiscal year ended October 31, 1999)
4.4 Form of Senior Indenture*..............................................
4.5 Form of Subordinated Indenture*........................................
4.6 Form of Senior Debt Security*..........................................
4.7 Form of Subordinated Debt Security*....................................
5.1 Opinion of Robinson & Cole LLP......................................... 40
12.1 Statement regarding computation of ratio of earnings to fixed
charges................................................................ 43
23.1 Consent of KPMG LLP.................................................... 44
23.2 Consent of Robinson & Cole LLP (included in Exhibit 5.1)...............
24.1 Power of Attorney (included on signature page of this
Registration Statement)
25.1 Statement of Eligibility and Qualification on Form T-1 of
Trustee*...............................................................
---------------------------
*To be filed by amendment or as an exhibit to a report pursuant to Section
13(a), 13(c) or 15(d) of the Securities Exchange Act of 1934.
39
