<PAGE> 1
As filed with the Securities and Exchange Commission on December 4, 1998
Registration No. 333-65743
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
----------------
QUINTILES TRANSNATIONAL CORP.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
NORTH CAROLINA 56-1714315
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
</TABLE>
4709 CREEKSTONE DRIVE
RIVERBIRCH BUILDING, SUITE 200
DURHAM, NORTH CAROLINA 27703-8411
(919) 941-2000
(Address, including zip code, and telephone number, including area
code, of registrant's principal executive offices)
DENNIS B. GILLINGS, PH.D.
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
QUINTILES TRANSNATIONAL CORP.
4709 CREEKSTONE DRIVE
RIVERBIRCH BUILDING, SUITE 200
DURHAM, NORTH CAROLINA 27703-8411
(919) 941-2000
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
-------------------------
COPIES TO:
GERALD F. ROACH, ESQ.
AMY J. MEYERS, ESQ.
SMITH, ANDERSON, BLOUNT,
DORSETT, MITCHELL & JERNIGAN, L.L.P.
2500 First Union Capitol Center
Raleigh, North Carolina 27601
(919) 821-1220
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon
as practicable after this registration statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
================================================================================
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
================================================================================
<PAGE> 2
QUINTILES TRANSNATIONAL CORP.
1,209,784 SHARES OF COMMON STOCK
The shareholders listed inside are offering to
sell 1,209,784 shares of Quintiles common
stock. The selling shareholders obtained their
shares when we acquired one of seven different
companies, including Crossbox, Ltd., ClinData
International (Proprietary) Limited, Data
Analysis Systems, Inc., Simirex, Inc., The
Royce Consultancy plc, QED International, Inc,
and H2V S.A., and when we acquired certain
business assets from Richard J. Fordham.
The selling shareholders may offer their
Quintiles shares through public or private
transactions, on or off the Nasdaq National
Market, at prevailing market prices, or at
privately negotiated prices. We will not
receive any part of the proceeds from the
sales.
Quintiles common stock is listed on the Nasdaq
National Market under the symbol "QTRN". On
___________, 1998, the last reported sale price
of our common stock was $_______ per share.
===============================================
You should consider carefully the risk factors
beginning on page 2 before making a decision to
purchase our stock.
===============================================
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.
The date of this prospectus is ________, 1998.
<PAGE> 3
ABOUT QUINTILES
Quintiles is a market leader in providing full-service contract research, sales,
marketing and health care policy consulting and health information management
services to the global pharmaceutical, biotechnology, medical device and health
care industries. Supported by our extensive information technology capabilities,
we provide a broad range of contract services to help our clients reduce the
length of time from the beginning of development to peak sales of a new drug or
medical device. Our contract research services include a full range of
development services focused on helping our clients through the development and
regulatory approval of a new drug or medical device. Our contract sales
services, including sales and specialized marketing support services, focus on
helping our clients achieve commercial success for a new product or medical
device. We also offer healthcare policy research and management consulting which
emphasize improving the quality, availability and cost-effectiveness of
healthcare.
RISK FACTORS YOU SHOULD CONSIDER
===============================================================================
In addition to the other information provided or incorporated by reference in
this prospectus, you should consider the following factors carefully in
evaluating us and our business before making an investment decision. If any of
the following risks occur, our business, financial condition, or results of
operations could be materially adversely affected. In that event, the trading
price of our common stock could decline, in which case the value of your
investment may decline as well. You should also refer to "Forward Looking
Statements" on page 19.
===============================================================================
OUR DEPENDENCE ON THE PHARMACEUTICAL AND BIOTECHNOLOGY INDUSTRIES
Our revenues depend on the research and development and sales and marketing
expenditures of the pharmaceutical and biotechnology industries. To date,
we have benefited from the tendency of companies in those industries to
hire outside organizations to conduct large clinical research and sales and
marketing projects. If these industries experience a general market decline
or begin to reduce their propensity to outsource those projects, our
operations and financial condition could be materially and adversely
affected.
IMPORTANCE OF OUR MANAGEMENT OF GROWTH
We have grown rapidly over the past 10 years. We believe that our continued
growth may place a strain on our existing operational, human and financial
resources. In order to manage our growth, we must continue to (1) improve
our operating and administrative systems, (2) attract and retain qualified
management, professional, scientific and technical personnel and (3)
assimilate differences in foreign business practices and overcome language
barriers.
We operate under a transnational organizational structure. A holding
company manages the operations of each of our service groups which perform
complementary functions. To date, this structure has successfully supported
our growth. We recently completed a number of acquisitions, and we cannot
assure you that this operational structure will continue to be effective.
Failure to
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<PAGE> 4
effectively manage our growth could result in a material adverse effect on
our operations and financial condition.
RISKS ASSOCIATED WITH OUR ACQUISITIONS
We have completed numerous acquisitions both within the United States and
internationally over the last several years and in 1998. In addition, we
are currently reviewing many acquisition candidates and continually
evaluating and competing for new acquisition opportunities. Acquisitions
involve numerous risks, including:
- difficulties and expenses incurred during the acquisition;
- integration of the acquired companies' operations and services;
- diversion of our management's attention from other business concerns;
- potential loss of the acquired companies' key employees;
- the risk that acquired companies will not perform as expected;
- Year 2000 risks of the acquired companies;
- additional risks of assimilating differences in foreign business
practices and overcoming language barriers (for acquisitions of
foreign companies);
- potential losses resulting from undiscovered liabilities of acquired
companies that are not covered by the indemnification we may obtain
from the sellers; and
- expenses related to acquisition negotiations that are not completed.
We will achieve the anticipated benefits from an acquisition only if we can
successfully integrate the business into our operations. Such integration
requires substantial attention from our management and may interrupt
certain of our operations and business cycles. We cannot assure you that we
can continue to successfully integrate into our operations our past
acquisitions or those we complete in the future. Furthermore, we cannot
assure you that we will either successfully complete future acquisitions or
that our completed acquisitions will contribute favorably to our operations
and future financial condition. The realization of any of these risks
associated with acquisitions could result in a material adverse effect on
our operations and financial condition.
RISKS RELATING TO OUR CONTRACT SALES SERVICES
Outsourced contract sales services, or hiring outside organizations to
perform sales and marketing projects, is a relatively new industry in some
countries where we operate. We believe that this industry emerged because
of regulatory agencies' actions to place cost containment pressure on
pharmaceutical companies. As a result, large pharmaceutical companies began
to outsource their sales and marketing activities related to product
launches (which typically require deployment of
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<PAGE> 5
large numbers of sales personnel for a relatively short amount of time).
Many countries, including the United States, have a low level of market
penetration for outsourced sales and marketing services. Thus, all
companies in this industry are subject to the risks inherent in a new or
emerging industry, including:
- an inability to attract and retain customers;
- changes in the regulatory regime;
- an absence of an established earnings history;
- the availability of properly trained personnel; and
- any unforeseen costs and expenses.
FACTORS THAT AFFECT OUR ABILITY TO COMPETE
Since we offer an extensive range of services, we confront a broad range of
competitors. Some of our competitors compete against us only with respect
to a single service or group of services, while others may compete across a
broader portion of our service lines. Our competitors generally fall within
two categories: contract research organizations and contract sales
organizations.
Contract Research Organizations: Contract research organizations offer
a variety of services that facilitate and advance the development of
new drugs and medical devices. These services include pre-clinical
planning, clinical trial supervision and regulatory submission and
approval. Our competitors for services of this type include traditional
contract research organizations; the in-house research and development
departments of pharmaceutical companies; universities; and teaching
hospitals; consulting firms, including boutique firms specializing in
the healthcare industry and the healthcare departments of large
consulting firms.
Contract Sales Organizations: Contract sales organizations offer
services designed to promote and assist in the development of a
commercial market for drugs and medical devices, as well as health
management services. Our competitors for services of this type include
in-house sales and marketing departments of pharmaceutical companies;
contract sales organizations in countries where we operate; and
consulting firms offering medical communications services.
Factors that affect our ability to compete include:
- the highly competitive nature of the market for contract research
services;
- our competitors' expansion into other areas in which we operate;
- increases in competition, which may lead to price and other forms of
competition that could have an effect on our profit margins;
- consolidation within the pharmaceutical industry, compounded by a
trend among pharmaceutical companies to limit outsourcing to fewer
full-service global organizations; and
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<PAGE> 6
- the trend towards consolidation among the providers of contract
research and contract sales services, which could result in greater
competition among the larger contract research and contract sales
providers for customers and acquisition candidates.
POTENTIAL LOSS OR DELAY OF OUR LARGE CONTRACTS
Most of our customers can terminate our contracts upon 15-90 days' notice.
In the event of termination, our contracts often provide for fees for
winding down the project. Still, the loss or delay of a large contract or
the loss or delay of multiple contracts could adversely affect our future
net revenue and profitability.
VARIABILITY OF OUR BACKLOG
We report backlog based on anticipated net revenue from uncompleted
projects that a customer has authorized. A number of factors may affect our
backlog, including:
- the variable size and duration of projects (some are performed over
several years);
- the loss or delay of projects; and
- a change in the scope of work during the course of a project.
We cannot assure you that the backlog we have reported will be indicative
of our future results.
POTENTIAL EFFECT OF COST OVERRUNS ON OUR FIXED PRICE CONTRACTS
Most of our service contracts have either a fixed price, a fixed price with
variable components or a fee-for-service subject to a cap. Under this
structure, we bear the risk of cost overruns. Underpricing of contracts or
significant cost overruns could have a material adverse effect on us.
IMPACT OF THE YEAR 2000 ISSUE ON OUR BUSINESS
State of Readiness
We have established a Year 2000 Program to address the Year 2000 issue,
which results from computer processors and software failing to process date
values correctly, potentially causing system failures or data corruption.
The Year 2000 issue could cause disruptions of our operations, including,
among other things, a temporary inability to process information; receive
information, services or products from third parties; interface with
customers in the performance of contracts; or operate or communicate in
some or all of the regions in which we do business. Our computing
infrastructure is based on industry standard systems. We do not depend on
large legacy systems and do not use mainframes. Rather, the scope of our
Year 2000 Program includes unique software systems and tools in each of our
service groups, especially our contract research service group, embedded
systems in our laboratory and manufacturing operations, facilities such as
elevators and fire alarms in over 70 offices (which also involve embedded
technology) and numerous supplier and
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other business relationships. We have identified critical systems within
each service group and are devoting our resources to address these items
first.
Our Year 2000 Program is directed by the Year 2000 Executive Steering Team,
which is comprised of our Chief Information Officer and representatives
from regional business units, together with legal, quality assurance and
information technology personnel. We have established a Year 2000 Program
Management Office, staffed by consultants, which develops procedures and
instructions at a centralized level and oversees performance of the
projects that make up the program. Project teams organized by service group
and geographic region are responsible for implementation of the individual
projects.
The framework for our Year 2000 Program prescribes broad inventory,
assessment and planning phases which generally guide our projects. Each
project generally includes launch, analysis, remediation, testing and
deployment phases. We are in the process of assessing those systems,
facilities and business relationships which we believe may be vulnerable to
the Year 2000 issue and which we believe could impact our operations.
Although we cannot control whether and how third parties will address the
Year 2000 issue, our assessment also will include a limited evaluation of
certain services on which we are substantially dependent, and we plan to
develop contingency plans for possible deficiencies in those services. For
example, we believe that among our most significant third party service
providers are physician investigators who participate in clinical studies
conducted through our contract research services; consequently, we are
developing a specialized process to assess and address Year 2000 issues
arising from these relationships. We do not plan to assess how our
customers, such as pharmaceutical and large biotechnology companies, are
dealing with the Year 2000 issue.
As we complete the assessment of our systems, we are developing plans to
renovate, replace or retire them, as appropriate, if they are affected by
the Year 2000 issue. Such plans generally include testing of new or
renovated systems upon completion of the remedial actions. We will utilize
both internal and external resources to implement these plans. Our
strategic healthcare communications services are less dependent on
information technology than our other services, and we expect to complete
all phases of the program with respect to those services in 1998. We expect
to address most systems relating to our healthcare consulting services in
1998, with completion expected in the first half of 1999. We also expect to
address most of our contract sales systems in 1998, and complete
development in the first half of 1999. Our contract research services
utilize numerous systems, which we must address independently on disparate
schedules, depending on the magnitude and complexity of the individual
system. We anticipate that critical deployment of these systems (or
migration to replacement systems where necessary) will occur primarily in
1999. We expect to complete the core components of our Year 2000 Program
before there is a significant risk that internal Year 2000 problems will
have a material impact on our operations.
Costs
We estimate that the aggregate costs of our Year 2000 Program will be
approximately $14 million, including costs already incurred. A significant
portion of these costs, approximately $6 million, are not likely to be
incremental costs, but rather will represent the redeployment of existing
resources. This reallocation of resources is not expected to have a
significant impact on our day-to-day operations. We incurred total Year
2000 Program costs of $1.6 million through September 30, 1998, of which
approximately $1.2 million represented incremental expense. Our estimates
regarding the
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cost, timing and impact of addressing the Year 2000 issue are based on
numerous assumptions of future events, including the continued availability
of certain resources, our ability to meet deadlines and the cooperation of
third parties. We cannot guarantee that our assumptions will be correct and
that these estimates will be achieved. Actual results could differ
materially from our expectations as a result of numerous factors, including
the availability and cost of personnel trained in this area, unforeseen
circumstances that would cause us to allocate our resources elsewhere and
similar uncertainties.
Our Year 2000 Risks
We face both internal and external risks from the Year 2000 issue. If
realized, these risks could have a material adverse effect on our business,
results of operations or financial condition. Our primary internal risk is
that our systems will not be Year 2000 compliant on time. The magnitude of
this risk depends on our ability to achieve compliance of both internally
and externally developed systems or to migrate to alternate systems in a
timely fashion. The decentralized nature of our business may compound this
risk if we are unable to coordinate efforts across our global operations on
a timely basis. We believe that our Year 2000 Program will successfully
address these risks, however, we cannot guarantee that this program will be
completed in a timely manner. Notwithstanding our Year 2000 Program, we
also face external risks that may be beyond our control. Our international
operations and our relationships with foreign third parties create
additional risks for us, as many countries outside the United States have
been less attuned to the Year 2000 issue. These risks include the
possibility that infrastructural systems, such as electricity, water,
natural gas or telephony, will fail in some or all of the regions in which
we operate, as well as the danger that the internal systems of our foreign
suppliers, service providers and customers will fail. Our business also
requires considerable travel, and our ability to perform services under our
customer contracts could be negatively affected if air travel is disrupted
by the Year 2000 issue.
In addition, our business depends heavily on the healthcare industry,
particularly on third party physician investigators. The healthcare
industry, and physicians' groups in particular, to date may not have
focused on the Year 2000 issue to the same degree as some other industries,
especially outside of major metropolitan centers. As a result, we face
increased risk that our physician investigators will be unable to provide
us with the data that we need to perform under our contracts on time, if at
all. Thus, the clinical study involved could be slowed or brought to a
halt. Also, the failure of our customers to address the Year 2000 issue
could negatively impact their ability to utilize our services. While we
intend to develop contingency plans to address certain of these risks, we
cannot assure you that any developed plans will sufficiently insulate us
from the effects of these risks. Any disruptions resulting from the
realization of these risks would affect our ability to perform our
services. If we are unable to receive or process information, or if third
parties are unable to provide information or services to us, we may not be
able to meet milestones or obligations under our customer contracts, which
could have a material adverse effect on our business and financial results.
Contingencies
Until we have completed our remediation, testing and deployment plans, we
believe it is premature to develop contingency plans to address what would
happen if our execution of these plans were to fail to address the Year
2000 issue.
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OUR DEPENDENCE ON KEY EXECUTIVES AND PERSONNEL
We rely on a number of key executives, including Dennis B. Gillings, Ph.D.,
our Chairman of the Board of Directors and Chief Executive Officer. We
maintain key man life insurance on Dr. Gillings in the amount of $3
million. The departure of Dr. Gillings, or any key executive, could have a
material adverse effect on our operations or financial condition. In
addition, our performance depends on our ability to attract and retain
qualified management and professional, scientific and technical operating
staff, as well as our ability to recruit qualified representatives for our
contract sales services. We cannot assure you that we will be able to
continue to attract and retain qualified personnel.
OUR EXPOSURE TO POTENTIAL LIABILITIES
Potential Liabilities Arising From Our Contract Research Services
We contract with physicians to serve as investigators in conducting
clinical trials to test new drugs on human volunteers. Such testing creates
risk of liability for personal injury to or death of volunteers,
particularly to volunteers with life-threatening illnesses, resulting from
adverse reactions to the drugs administered during testing. It is possible
third parties could claim that we should be held liable for losses arising
from any professional malpractice of the investigators with whom we
contract or in the event of personal injury to or death of persons
participating in clinical trials. We do not believe we are legally
accountable for the medical care rendered by third party investigators, and
we would vigorously defend any such claims. Nonetheless, it is possible we
could be found liable for those types of losses.
In addition to supervising such tests, we also own a number of labs where
Phase I clinical trials are conducted. Phase I clinical trials involve
testing a new drug on a limited number of healthy individuals, typically 20
to 80 persons, to determine the drug's basic safety. We also could be
liable for the general risks associated with ownership of such a facility.
These risks include, but are not limited to, adverse events resulting from
the administration of drugs to clinical trial participants or the
professional malpractice of Phase I medical care providers.
Potential Liabilities Arising From Our Other Services
We also could be held liable for errors or omissions in connection with the
services each of our service groups perform.
Measures We Take to Reduce Our Risk From Potential Liabilities.
We attempt to reduce risk from potential liabilities through:
- contractual indemnification provisions with customers and
investigators;
- insurance maintained by us, our customers and our investigators;
- various regulatory requirements, including the use of institutional
review boards; and
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- the procurement of each volunteer's informed consent to participate
in a study.
You should note several aspects about our contractual indemnifications.
First, they generally do not fully protect us against some of our own
actions, such as negligence. Second, the terms and scope of each
indemnification vary from customer to customer and from trial to trial.
Finally, the financial performance of any of these indemnities is not
secured. As a result, we bear the risk that the indemnifying party may not
have the financial ability to fulfill its indemnification obligations.
Our professional liability insurance covers the worldwide territories in
which we operate and includes drug safety issues, as well as data
processing errors and omissions. We can offer you no assurance that we will
be able to maintain this insurance on terms acceptable to us or that this
insurance will cover all of our losses. We caution you that our financial
condition could be materially and adversely affected if we were required to
pay damages or bear the costs of defending any claim (1) outside the scope
of or in excess of a contractual indemnification provision, (2) beyond the
level of insurance coverage or (3) in the event that an indemnifying party
does not fulfill its indemnification obligations.
EFFECT OF GOVERNMENT REGULATION ON OUR BUSINESS
Our contract research business benefits from the extensive governmental
regulation of the drug development/approval process, particularly in the
United States. From time to time legislation is introduced in the U.S.
Congress to substantially modify regulations administered by the Food and
Drug Administration, the agency governing this process. We believe the
level of regulation is generally less burdensome outside the United States.
Still, European countries are attempting to establish common standards for
clinical testing of new drugs. This trend has caused changes in the various
requirements currently imposed by each country. Some of the changes under
consideration in the United States and elsewhere include mandatory
substitution of generic drugs for patented drugs, relaxation in the scope
of regulatory requirements or the introduction of simplified drug approval
procedures. These and other changes in regulation could decrease the
business opportunities available to us. In addition, any failure on our
part to comply with applicable regulations could result in the termination
of ongoing clinical research or sales and marketing projects or the
disqualification of data for submission to regulatory authorities, either
of which could have a material adverse effect on us.
RISK OF UNCERTAINTY IN HEALTHCARE INDUSTRY AND POSSIBLE HEALTHCARE REFORM TO OUR
BUSINESS
Changing political, economic and regulatory influences in the healthcare
industry may affect the pharmaceutical, biotechnology and medical device
industries. Numerous governments have undertaken efforts to control growing
healthcare costs through legislation, regulation and voluntary agreements
with medical care providers and pharmaceutical companies. Implementation of
government healthcare reform may adversely affect research and development
expenditures by these companies, which could decrease the business
opportunities available to us. We cannot predict the likelihood of
healthcare reform legislation being enacted or the effects such legislation
would have on our operations.
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EXCHANGE RATE FLUCTUATION RISKS TO OUR OPERATIONS AND FINANCIAL RESULTS
We derive a large portion of our net revenue from our operations outside
the United States, as illustrated by the following table:
<TABLE>
<CAPTION>
% of Net Revenue from
Year Foreign Operations
================ ============================
<S> <C>
1997 50.0%
---------------- ----------------------------
1996 57.0%
---------------- ----------------------------
1995 60.1%
================ ============================
</TABLE>
Factors associated with international operations, including changes in
foreign currency exchange rates and uncertainties relative to regional
economic circumstances, could significantly affect our operations and
financial results. Exchange rate fluctuations between local currencies and
the U.S. dollar create risk in several ways, including:
- Foreign Currency Translation Risk. The revenue and expenses of our
foreign operations are generally denominated in local currencies.
- Foreign Currency Transaction Risk. Our service contracts may be
denominated in a currency other than the currency in which we incur
expenses related to such contracts.
We try to limit these risks through exchange rate fluctuation provisions
stated in our service contracts, or we may hedge our transaction risk with
foreign currency exchange contracts or options. Despite these efforts, we
may still experience fluctuations in financial results from our operations
outside the United States, and we cannot assure you that we will be able to
favorably reduce our currency transaction risk associated with our service
contracts.
VARIATION IN OUR QUARTERLY RESULTS
The results of our operations have been, and can be expected to be, subject
to quarterly fluctuations. Quarterly results can fluctuate as a result of a
number of factors, including:
- the timing of start-up expenses for new offices;
- the completion of acquisitions;
- the completion or commencement of significant contracts;
- changes in the mix of services offered; and
- foreign exchange fluctuations.
Because of these factors, we believe that you should not rely on quarterly
comparisons of our financial results as an indication of our future
performance.
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EFFECT OF VOLATILITY OF OUR STOCK PRICE ON AN INVESTMENT IN OUR STOCK
The market price of our common stock has been and may continue to be
subject to wide fluctuations. Factors affecting our stock price may include
(1) variations in operating results from quarter to quarter, (2) changes in
earnings estimates by analysts, (3) market conditions in the industry and
(4) general economic conditions. Consequently, the current market price of
our common stock may not be indicative of future market prices, and we
cannot guarantee that you will be able to sustain or increase the value of
your investment in our common stock.
USE OF PROCEEDS
The selling shareholders will receive all net proceeds from the sale of their
shares. We will not receive any proceeds from the sale of the shares.
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SELLING SHAREHOLDERS
The selling shareholders obtained their shares when we acquired one of seven
different companies, including Crossbox, Ltd., ClinData International
(Proprietary) Limited, Data Analysis Systems, Inc., Simirex, Inc., The Royce
Consultancy plc, QED International, Inc, and H2V S.A., and when we acquired
certain business assets from Richard J. Fordham. Pursuant to the terms of each
acquisition, we agreed to register certain amounts of each selling shareholder's
shares for resale by the selling shareholder. We are registering this Common
Stock to permit public secondary trading in the shares. The selling shareholders
may offer and sell the shares from time to time pursuant to this prospectus, as
further discussed under the caption, "Plan of Distribution."
The following table sets forth important information about each selling
shareholder as of October 14, 1998.
<TABLE>
<CAPTION>
Shares Beneficially Shares Shares Beneficially
Owned Prior Being Owned After
Name To Offering(1) Offered Offering(1)
- ---- --------------------------- ------- -------------------------
Number Percent Number Percent
------ ------- ------ -------
<S> <C> <C> <C> <C> <C>
Former Crossbox, Ltd. Shareholders
Michael F. Parker (2)............................ 23,581 * 7,070 16,511 *
Georgiana W. Bronfman (3)........................ 23,581 * 7,070 16,511 *
Hampshire Investment Company (4)................. 23,581 * 7,000 16,581 *
Former ClinData International (Proprietary) Limited Shareholders
Hermanus G. Luus (5)............................. 41,293 * 41,293 0 *
Robert Schall (6)................................ 41,293 * 41,293 0 *
Theodorus P. Erasmus(7).......................... 41,293 * 41,293 0 *
Former Data Analysis Systems, Inc. Shareholders
James N. Arvesen (8)............................. 85,320 * 15,000 70,320 *
Richard W. Johnston (9).......................... 85,320 * 9,000 76,320 *
Aditya K. Jha (10)............................... 41,429 * 16,000 25,429 *
David L. Schellenberg (11)....................... 41,019 * 5,000 36,019 *
Walter J. Farrar (12)............................ 19,738 * 8,880 10,858 *
Stephen A LoSardo (13)........................... 19,738 * 9,184 10,554 *
Cynthia K. Yule (14)............................. 1,903 * 950 953 *
Sharon L. Behrends (15).......................... 869 * 434 435 *
John L. Badolato (16)............................ 7,662 * 3,831 3,831 *
David R. Stokar (17)............................. 3,576 * 1,788 1,788 *
Former Simirex, Inc. Shareholders
Peter Bernardo (18).............................. 383,273 * 63,240 256,793 *
Loretta Bernardo (19)............................ 383,273 * 63,240 256,793 *
Former Royce Consultancy PLC Shareholders
Harold W. Clark(20).............................. 581,170 * 581,170 0 *
Ian C. Hogan (21)................................ 83,024 * 83,024 0 *
</TABLE>
12
<PAGE> 14
<TABLE>
<CAPTION>
Shares Beneficially Shares Shares Beneficially
Owned Prior Being Owned After
Name To Offering(1) Offered Offering(1)
- ---- --------------------------- ------- -------------------------
Number Percent Number Percent
------ ------- ------ -------
<S> <C> <C> <C> <C> <C>
Former QED International, Inc. Shareholders
Richard Johnson, M.D (22)........................ 392,640 * 129,571 263,069 *
Robert Blink (23)................................ 130,880 * 43,190 87,690 *
Former H2V S.A. Shareholders
Alain Volle (24)................................. 63,070 * 22,070 41,000 *
Henri Vincent (25)............................... 7,403 * 2,590 4,813 *
Pierre Henriot (26).............................. 7,403 * 2,590 4,813 *
Former Owner of certain business assets
Richard J. Fordham............................... 4,013 * 4,013 0 *
</TABLE>
- --------------------
* Less than one percent
(1) Based on 76,765,856 shares of Common Stock outstanding as of September 30,
1998, and the same number of shares outstanding after the offering. Pursuant to
the rules of the Commission, certain shares of the Common Stock that a person
has the right to acquire within 60 days pursuant to the exercise of stock
options are deemed to be outstanding for the purpose of computing the percentage
ownership of such person but are not deemed outstanding for the purpose of
computing the percentage ownership of any other person.
(2) Includes 2,358 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
(3) Includes 2,358 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
(4) Includes 2,358 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
(5) Includes 4,129 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
(6) Includes 4,129 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
(7) Includes 4,129 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
(8) Includes 8,532 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow. Dr. Arvesen is President and
a director of Innovex DAS, Inc., a wholly-owned subsidiary of Quintiles.
(9) Includes 8,532 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow. Mr. Johnston is Vice
President, Operations and a director of Innovex DAS, Inc., a wholly-owned
subsidiary of Quintiles.
13
<PAGE> 15
(10) Includes 4,142 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow. Mr. Jha is Vice President,
International of Innovex DAS, Inc., a wholly-owned subsidiary of Quintiles.
(11) Includes 4,101 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow. Mr. Schellenberg is Vice
President, Market Research of Innovex DAS, Inc., a wholly-owned subsidiary of
Quintiles.
(12) Includes 1,973 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow. Mr. Farrar is Vice President,
Software Development of Innovex DAS, Inc., a wholly-owned subsidiary of
Quintiles.
(13) Includes 1,973 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow. Mr. LoSardo is Vice
President, Advanced Technologies of Innovex DAS, Inc., a wholly-owned subsidiary
of Quintiles.
(14) Includes 190 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
(15) Includes 86 shares held in escrow pursuant to the terms of the acquisition,
which escrowed shares may be sold only upon distribution to the selling
shareholder under the terms of the escrow.
(16) Includes 766 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
(17) Includes 357 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
(18) Includes 172,473 shares acquired in connection with the acquisition which
are held by Mr. Bernardo's wife, Loretta Bernardo. Also includes 38,327 shares
held in escrow pursuant to the terms of the acquisition, which escrowed shares
may be sold only upon distribution to Mr. Bernardo and Loretta Bernardo under
the terms of the escrow. In the offering, Mr. Bernardo and Loretta Bernardo each
are selling 63,240 shares. Mr. Bernardo is Chief Operating Officer and a
director of Simirex, Inc. and is Vice President and a director of Simirex
International, Ltd., both wholly-owned subsidiaries of Quintiles.
(19) Includes 172,473 shares acquired in connection with the acquisition which
are held by Mrs. Bernardo's husband, Peter Bernardo. Includes 38,327 shares held
in escrow pursuant to the terms of the acquisition, which escrowed shares may be
sold only upon distribution to Mrs. Bernardo and Peter Bernardo under the terms
of the escrow. In the offering, Peter Bernardo and Mrs. Bernardo each are
selling 63,240 shares. Mrs. Bernardo is Senior Director and Chief Financial
Officer and a director of Simirex, Inc. and is President and Treasurer and a
director of Simirex International, Ltd., both wholly-owned subsidiaries of
Quintiles.
(20) Includes 58,117 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
(21) Includes 8,302 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
(22) Includes 39,264 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow. Dr. Johnson is President and
serves on the board of directors of QED International, Inc., a wholly-owned
subsidiary of Quintiles.
14
<PAGE> 16
(23) Includes 13,088 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow. Mr. Blink is Vice President
and serves on the board of directors of QED International, Inc., a wholly-owned
subsidiary of Quintiles.
(24) Includes 6,307 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
(25) Includes 740 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
(26) Includes 740 shares held in escrow pursuant to the terms of the
acquisition, which escrowed shares may be sold only upon distribution to the
selling shareholder under the terms of the escrow.
PLAN OF DISTRIBUTION
METHODS OF OFFERS AND SALES
The selling shareholders may sell the shares at various times in one or
more of the following transactions (which may include block transactions):
- on the Nasdaq National Market;
- in negotiated transactions;
- through put or call transactions related to the shares;
- in connection with short sales of Quintiles stock; or
- in a combination of any of the above transactions.
The selling shareholders may sell their shares at market prices prevailing
at the time of sale, at prices related to the prevailing market price or at
negotiated prices.
If any selling shareholder uses broker-dealers, such broker-dealers may
receive commissions or discounts from the selling shareholders, or they may
receive commissions from the purchaser for whom they acted as agent or to
whom they sell as principal (or both). There is the possibility that the
selling shareholders and the broker-dealers (who effect sales) may be
deemed to be "underwriters" under the Securities Act, and their commissions
or discounts regarded as underwriters' compensation. Because of this
possibility, the selling shareholders must comply with the prospectus
delivery requirements of the Securities Act.
Each selling shareholder has agreed to notify us upon entering into an
arrangement with a broker- dealer for the sale of shares through any one or
more of the following methods:
15
<PAGE> 17
- a block trade,
- a special offering,
- an exchange distribution or secondary distribution, or
- purchase by a broker or a dealer.
Once we receive such notification, if required, we will file a prospectus
supplement pursuant to Rule 424(b) of the Securities Act describing: (1)
the broker-dealer's name; (2) the number of shares involved; (3) the
commissions paid to the broker-dealer; (4) the discounts given or
concessions allowed to the broker dealer; (5) a statement that the
broker-dealer did not conduct any investigation to verify the information
contained in or incorporated by reference in this prospectus (if
applicable); and (6) other material facts of the transaction.
The selling shareholders also may sell all or a portion of the shares in
open-market transactions in reliance on Rule 144 under the Securities Act,
provided that they can satisfy the requirements of that rule.
The selling shareholders' rights to be included in this registration
statement and prospectus are not transferable. Nevertheless, we may permit
certain donees, such as charitable organizations, who may receive shares
from a selling shareholder after the date of this prospectus, to sell their
shares under this prospectus. Any such donee may sell the shares in
accordance with the terms described in this plan of distribution. We will
not receive any of the proceeds from such sales.
DURATION OF RESALE PERIOD UNDER THIS PROSPECTUS
We anticipate that the registration statement shall remain effective as to
each selling shareholder group until the earlier of (1) the date when all
of the shares included in the registration statement have been distributed
to the public; or (2) the date as set forth in the table below with respect
to each group.
<TABLE>
<CAPTION>
Selling Shareholder Group Termination of Offering
=================================================== =====================================================
<S> <C>
Crossbox, Ltd. May 31, 1999
ClinData International (Proprietary) Limited May 26, 1999 (the date the selling
shareholders' shares become eligible
for resale under Rule 144 of the
Securities Act)
Data Analysis Systems, Inc.* 120 days following the lapse of the pooling
restriction (which is expected to occur in early 1999)
Simirex, Inc.* October 8, 1999
</TABLE>
16
<PAGE> 18
<TABLE>
<CAPTION>
Selling Shareholder Group Termination of Offering
=================================================== =====================================================
<S> <C>
The Royce Consultancy, plc* August 24, 1999 (the date the
selling shareholders' shares become
eligible for resale under Rule 144
of the Securities Act)
QED International, Inc.* October 12, 1999
H2V S.A. October 9, 1999 (the date the selling shareholders'
shares become eligible for resale under Rule 144 of
the Securities Act)
Richard J. Fordham October 31, 1999
</TABLE>
- ---------------------
* Certain of the selling shareholders may not sell (or otherwise reduce
their risk relative to their shares) for a certain period of time as
required by the pooling of interests accounting rules. The restricted
period ends once we have published financial statements covering at
least 30 days of our operations combined with each pooled or merged
company. Thus, the selling shareholders may be unable to immediately
sell all or any of the shares.
COSTS AND INDEMNIFICATION
We will pay our own legal and accounting fees, all registration and filing
fees attributable to the registration of the shares, any legal fees and
filing fees relating to state securities or "blue sky" filings, the filing
fee payable to The Nasdaq Stock Market, and all printing fees incurred in
connection with the preparation of the registration statement. Each selling
shareholder will pay his, her or its own legal fees. The selling
shareholders will pay any selling discounts and commissions and stock
transfer taxes applicable to a sale of shares.
We have agreed to indemnify certain of the selling shareholders and their
officers and directors, and each person who controls such selling
shareholder, in certain circumstances against certain liabilities,
including liabilities arising under the Securities Act. The same selling
shareholders have agreed to indemnify us and our directors and officers and
each person who controls us in similar terms.
17
<PAGE> 19
WHERE YOU CAN FIND MORE INFORMATION ABOUT QUINTILES
We file reports, proxy statements and other information with the SEC. You may
read and copy any of these materials at the SEC's public reference room in
Washington, D.C. You may obtain information on the operation of the public
reference room by calling the SEC at 1-800-SEC-0330. You can also find our SEC
filings on the SEC's web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" in this prospectus the
information we file with them. This means that we can disclose important
information to you by referring you to those documents. Any information we
incorporate by reference is considered part of this prospectus, and any
information we later file with the SEC will automatically update and supersede
the information in this prospectus.
We incorporate by reference in this prospectus and refer you to the documents
listed below (File No. 000-23520):
1. Our Annual Report on Form 10-K for the fiscal year ended December
31, 1997;
2. Our Quarterly Reports of Form 10-Q for the fiscal quarters ended
March 31, 1998 and June 30, 1998;
3. Our Current Reports on Form 8-K dated February 2, 1998, February 4,
1998, February 26, 1998, February 26, 1998 (as amended March 20,
1998 on Form 8-K/A), March 20, 1998, April 22, 1998 and July 22,
1998;
4. The description of our Common Stock contained in our Registration
Statement on Form 8-A, filed with the SEC on February 28, 1994 and
amended on April 11, 1994; and
5. All other documents we file with the SEC pursuant to Section 13(a),
13(c) or 15(d) of the Exchange Act of 1934 after the date of this
prospectus and before the end of this offering.
You may request a copy of these filings, at no cost, by writing or telephoning
us at the following:
Investor Relations
Quintiles Transnational Corp.
4709 Creekstone Drive
Riverbirch Building, Suite 200
Durham, North Carolina 27703-8411
(919) 941-2000
You should also note that the SEC considers this prospectus to be part of a
registration statement filed with the SEC (Registration No. 333-65743). Since
this prospectus omits certain portions of the information provided in the
registration statement, we also refer you to that document.
18
<PAGE> 20
================================================================================
YOU SHOULD RELY ONLY ON THE INFORMATION INCORPORATED BY REFERENCE OR PROVIDED IN
THIS PROSPECTUS. WE HAVE NOT AUTHORIZED ANYONE TO GIVE YOU DIFFERENT
INFORMATION. THE SELLING SHAREHOLDERS WILL NOT MAKE AN OFFER OF THESE SHARES IN
ANY STATE WHERE THE OFFER IS NOT PERMITTED. YOU SHOULD NOT ASSUME THAT THE
INFORMATION IN THIS PROSPECTUS, OR ANY SUPPLEMENT, IS ACCURATE AS OF ANY DATE
OTHER THAN THE DATE ON THE FRONT OF THOSE DOCUMENTS.
================================================================================
FORWARD LOOKING STATEMENTS
We make statements in this prospectus and in the documents incorporated by
reference that fall within the definition of "forward looking statements" found
in Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. You can identify these statements by our use of words like
"may," "will," "expect," "anticipate," "estimate," or "continue" or comparable
terms and phrases.
Forward looking statements represent our judgment about the future and are not
guarantees of our future performance. Certain risks and uncertainties could
cause our actual operating results and financial position to differ materially
from our projections, including the considerations described in connection with
specific forward looking statements, factors discussed in this prospectus under
the caption "Risk Factors You Should Consider" and other cautionary statements
you may find in this prospectus and in the documents we incorporate by
reference. Therefore, we caution you not to place undue reliance on forward
looking statements. Such forward looking statements represent our estimates and
assumptions only as of the date of this prospectus.
LEGAL MATTERS
Our lawyers, Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan, L.L.P., will
issue a legal opinion concerning the legality of the selling shareholders'
shares. Smith Anderson lawyers own in the aggregate approximately 4,319 shares
of Quintiles stock.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our consolidated financial
statements included in our Current Report on Form 8-K dated March 20,1998 and
our Annual Report on Form 10-K for the year ended December 31, 1997, as set
forth in their report, which is incorporated by reference in this prospectus.
Our consolidated financial statements are incorporated by reference in reliance
upon such report given upon the authority of such firm as experts in accounting
and auditing.
19
<PAGE> 21
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. Other Expenses of Issuance and Distribution.
The following table shows the estimated expenses of the issuance and
distribution of securities offered hereby. The selling shareholders will not
bear any of these expenses.
<TABLE>
<S> <C>
SEC Registration Fee........................................................... $ 15,078.45
Legal Fees and Expenses........................................................ $ 50,000.00
Accounting Fees and Expenses................................................... $ 100,000.00
Printing and Related Expenses.................................................. $ 1,500.00
Miscellaneous Expenses......................................................... $ 5,421.55
-------------
Total................................................................. $ 172,000.00
=============
</TABLE>
ITEM 15. Indemnification of Directors and Officers
Sections 55-8-50 through 55-8-58 of the North Carolina Business
Corporation Act permit a corporation to indemnify its directors, officers,
employees or agents under either or both a statutory or nonstatutory scheme of
indemnification. Under the statutory scheme, a corporation may, with certain
exceptions, indemnify a director, officer, employee or agent of the corporation
who was, is, or is threatened to be made, a party to any threatened, pending or
completed legal action, suit or proceeding, whether civil, criminal,
administrative or investigative, because of the fact that such person was a
director, officer, agent or employee of the corporation, or is or was serving at
the request of such corporation as a director, officer, employee or agent of
another corporation or enterprise. This indemnity may include the obligation to
pay any judgment, settlement, penalty, fine (including an excise tax assessed
with respect to an employee benefit plan) and reasonable expenses incurred in
connection with a proceeding (including counsel fees), but no such
indemnification may be granted unless such director, officer, agent or employee
(i) conducted himself in good faith, (ii) reasonably believed (1) that any
action taken in his official capacity with the corporation was in the best
interest of the corporation or (2) that in all other cases his conduct at least
was not opposed to the corporation's best interest, and (iii) in the case of any
criminal proceeding, had no reasonable cause to believe his conduct was
unlawful. Whether a director has met the requisite standard of conduct for the
type of indemnification set forth above is determined by the board of directors,
a committee of directors, special legal counsel or the shareholders in
accordance with Section 55-8-55. A corporation may not indemnify a director
under the statutory scheme in connection with a proceeding by or in the right of
the corporation in which the director was adjudged liable to the corporation or
in connection with a proceeding in which a director was adjudged liable on the
basis of having received an improper personal benefit.
In addition to, and separate and apart from the indemnification
described above under the statutory scheme, Section 55-8-57 of the North
Carolina Business Corporation Act permits a corporation to indemnify or agree to
indemnify any of its directors, officers, employees or agents against liability
and expenses (including attorney's fees) in any proceeding (including
proceedings brought by or on behalf of the corporation) arising out of their
status as such or their activities in any of the foregoing capacities;
II-1
<PAGE> 22
provided, however, that a corporation may not indemnify or agree to indemnify a
person against liability or expenses such person may incur on account of
activities that were, at the time taken, known or believed by the person to be
clearly in conflict with the best interests of the corporation. The Company's
bylaws provide for indemnification to the fullest extent permitted under the
North Carolina Business Corporation Act, provided, however, that the Company
will indemnify any person seeking indemnification in connection with a
proceeding initiated by such person only if such proceeding was authorized by
the Board of Directors of the Company. Accordingly, the Company may indemnify
its directors, officers and employees in accordance with either the statutory or
the non-statutory standard.
Sections 55-8-52 and 55-8-56 of the North Carolina Business Corporation
Act require a corporation, unless its articles of incorporation provide
otherwise, to indemnify a director or officer who has been wholly successful, on
the merits or otherwise, in the defense of any proceeding to which such director
or officer was a party. Unless prohibited by the articles of incorporation, a
director or officer also may make application and obtain court-ordered
indemnification if the court determines that such director or officer is fairly
and reasonably entitled to such indemnification as provided in Sections 55-8-54
and 55-8-56.
Finally, Section 55-8-57 of the North Carolina Business Corporation Act
provides that a corporation may purchase and maintain insurance on behalf of an
individual who is or was a director, officer, employee or agent of the
corporation against certain liabilities incurred by such persons, whether or not
the corporation is otherwise authorized by the North Carolina Business
Corporation Act to indemnify such party. The Company's directors and officers
are currently covered under directors' and officers' insurance policies
maintained by the Company.
As permitted by North Carolina law, Article XI of the Company's
Articles of Incorporation limits the personal liability of directors for
monetary damages for breaches of duty as a director provided that such
limitation will not apply to (i) acts or omissions that the director at the time
of the breach knew or believed were clearly in conflict with the best interests
of the Company, (ii) any liability for unlawful distributions under N.C. Gen.
Stat. Section 55-8-33 of the North Carolina Business Corporation Act, (iii) any
transaction from which the director derived an improper personal benefit, or
(iv) acts or omissions occurring prior to the date the provision became
effective.
ITEM 16. Exhibits
The following documents (unless indicated) are filed herewith and made
a part of this Registration Statement.
<TABLE>
<CAPTION>
Exhibit
Number Description of Exhibit
- ----- ----------------------
<S> <C>
4.01(1) Specimen Common Stock Certificate
4.02(2) Amended and Restated Articles of Incorporation, as amended
4.03(3) Amended and Restated Bylaws
4.04* Terms of registration rights granted by Quintiles to the
Crossbox, Ltd selling stockholders
4.05* Terms of registration rights granted by Quintiles to the
ClinData International (Proprietary) Ltd. selling
shareholders
</TABLE>
II-2
<PAGE> 23
<TABLE>
<S> <C>
4.06* Terms of registration rights granted by Quintiles to the
Data Analysis Systems, Inc. selling shareholders
4.07* Terms of registration rights granted by Quintiles to the
Simirex, Inc. selling shareholders
4.08* Terms of registration rights granted by Quintiles to the
Royce Consultancy, plc selling shareholders
4.09* Terms of registration rights granted by Quintiles to the QED
International, Inc. selling shareholders
4.10* Terms of registration rights granted by Quintiles to the H2V
S.A. selling shareholders
4.11* Terms of registration rights granted by Quintiles to Richard
J. Fordham
5.01** Opinion of Smith, Anderson, Blount, Dorsett, Mitchell &
Jernigan, L.L.P. regarding legality of securities being
registered
23.01** Consent of Ernst & Young LLP
23.02** Consent of PricewaterhouseCoopers LLP
23.03** Consent of KPMG
23.04** Consent of Smith, Anderson, Blount, Dorsett, Mitchell &
Jernigan, L.L.P. (included in Exhibit 5.01 hereto)
24.01* Power of Attorney
</TABLE>
---------------
* Previously filed
** To be filed by amendment
(1) Exhibit to the Company's Registration Statement on Form S-1,
as amended, (Registration No. 33-75766) as filed with the
Commission, effective April 20, 1994, and incorporated herein
by reference.
(2) Exhibit to the Company's Registration Statement on Form S-3,
as amended, (Registration No. 333-19009) as filed with the
Commission, effective February 21, 1997, and incorporated
herein by reference.
(3) Exhibit to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1995 as filed with the
Commission on March 25 1996, as amended on May 16, 1996 and
incorporated herein by reference.
ITEM 17. Undertakings
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers and 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
II-3
<PAGE> 24
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; and
(iii) To include any material information with
respect to the plan of distribution not previously disclosed
in the registration statement or any material change to such
information in the registration statement.
Provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if
the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed with or
furnished to the Commission by the registrant pursuant to Section 13 or
15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in the registration statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 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.
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 Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-4
<PAGE> 25
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 Durham, State of North Carolina, on December 4, 1998.
QUINTILES TRANSNATIONAL CORP.
By: /s/ Dennis B. Gillings
-------------------------------------
Dennis B. Gillings, Ph.D.
Chairman of the Board of Directors
and Chief Executive officer
II-5
<PAGE> 26
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons as of December
4, 1998 in the capacities indicated.
<TABLE>
<CAPTION>
Signature Title
- --------- -----
<S> <C>
/s/ Dennis B. Gillings Chairman of the Board of Directors and Chief Executive Officer
- -------------------------------------
Dennis B. Gillings, Ph.D.
* President, Chief Operating Officer and Director
- -------------------------------------
Santo J. Costa
/s/ Rachel R. Selisker Chief Financial Officer, Executive Vice President Finance,
- ------------------------------------- and Director (Principal accounting and financial officer)
Rachel R. Selisker
* Director
- -------------------------------------
Robert C. Bishop, Ph.D.
* Director
- -------------------------------------
E.G. F. Brown
* Director
- -------------------------------------
Vaughn D. Bryson
* Director
- -------------------------------------
Chester W. Douglass, Ph.D.
* Director
- -------------------------------------
Lawrence S. Lewin
* Director
- -------------------------------------
Arthur M. Pappas
* Director
- -------------------------------------
Ludo J. Reynders, Ph.D
* Director
- -------------------------------------
Eric J. Topol, M.D.
* Director
- -------------------------------------
Virginia V. Weldon, M.D.
* Director
- -------------------------------------
David F. White
* By: /s/ Rachel R. Selisker By: /s/ Dennis B. Gillings
------------------------------ -------------------------------
Rachel R. Selisker Dennis B. Gillings, Ph.D.
</TABLE>
II-6
<PAGE> 27
<TABLE>
<CAPTION>
EXHIBIT INDEX
Exhibit
Number Description of Exhibit
- ------ ----------------------
<S> <C>
4.01(1) Specimen Common Stock Certificate
4.02(2) Amended and Restated Articles of Incorporation, as amended
4.03(3) Amended and Restated Bylaws
4.04* Terms of registration rights granted by Quintiles to the
Crossbox, Ltd selling stockholders
4.05* Terms of registration rights granted by Quintiles to the
ClinData International (Proprietary) Ltd. selling
shareholders
4.06* Terms of registration rights granted by Quintiles to the
Data Analysis Systems, Inc. selling shareholders
4.07* Terms of registration rights granted by Quintiles to the
Simirex, Inc. selling shareholders
4.08* Terms of registration rights granted by Quintiles to the
Royce Consultancy, plc selling shareholders
4.09* Terms of registration rights granted by Quintiles to the QED
International, Inc. selling shareholders
4.10* Terms of registration rights granted by Quintiles to the H2V
S.A. selling shareholders
4.11* Terms of registration rights granted by Quintiles to Richard
J. Fordham
5.01** Opinion of Smith, Anderson, Blount, Dorsett, Mitchell &
Jernigan, L.L.P. regarding legality of securities being
registered
23.01** Consent of Ernst & Young LLP
23.02** Consent of PricewaterhouseCoopers LLP
23.03** Consent of KPMG
23.04** Consent of Smith, Anderson, Blount, Dorsett, Mitchell &
Jernigan, L.L.P. (included in Exhibit 5.01 hereto)
24.01* Power of Attorney
</TABLE>
---------------
* Previously filed
** To be filed by amendment
(1) Exhibit to the Company's Registration Statement on Form S-1,
as amended, (Registration No. 33-75766) as filed with the
Commission, effective April 20, 1994, and incorporated herein
by reference.
(2) Exhibit to the Company's Registration Statement on Form S-3,
as amended, (Registration No. 333-19009) as filed with the
Commission, effective February 21, 1997, and incorporated
herein by reference.
(3) Exhibit to the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1995 as filed with the
Commission on March 25 1996, as amended on May 16, 1996 and
incorporated herein by reference.
II-7
