<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 4, 1994
REGISTRATION NO. 33-83952
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 5
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
ICN MERGER CORP.
(TO BE RENAMED ICN PHARMACEUTICALS, INC.)
(EXACT NAME OF ISSUER AS SPECIFIED IN ITS CHARTER)
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DELAWARE 2834 33-0628076
(STATE OR OTHER JURISDICTION OF PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER IDENTIFICATION NUMBER)
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------------------------
3300 HYLAND AVENUE, COSTA MESA, CALIFORNIA 92626 (714) 545-0100
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
MILAN PANIC
CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER, ICN MERGER CORP.
3300 HYLAND AVENUE, COSTA MESA, CALIFORNIA 92626 (714) 545-0100
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
------------------------
PLEASE SEND COPIES OF ALL CORRESPONDENCE TO:
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JEFFREY BAGNER, ESQ. LEONARD M. LEIMAN, ESQ.
FRIED, FRANK, HARRIS, SHRIVER & JACOBSON FULBRIGHT & JAWORSKI L.L.P.
ONE NEW YORK PLAZA 666 FIFTH AVENUE
NEW YORK, NEW YORK 10004 NEW YORK, NEW YORK 10103
(212) 820-8000 (212) 318-3000
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------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after the effective date of this Registration Statement.
------------------------
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 THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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ICN MERGER CORP.
CROSS-REFERENCE SHEET
PURSUANT TO ITEM 501(B) OF REGULATION S-K
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FORM S-1 ITEM AND CAPTION LOCATION IN PROSPECTUS
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1. Forepart of Registration Statement and
Outside Front Cover Page of Prospectus... Facing Page; Outside Front Cover Page;
Available Information
2. Inside Front and Outside Back Cover Pages
of Prospectus............................ Inside Front Cover Page
3. Summary Information, Risk Factors and
Ratio of Earnings to Fixed Charges....... Summary; Investment Considerations; Selected
Historical Consolidated Financial
Information
4. Use of Proceeds.......................... Use of Proceeds
5. Determination of Offering Price.......... Underwriting
6. Dilution................................. Not Applicable
7. Selling Security Holders................. Not Applicable
8. Plan of Distribution..................... Underwriting
9. Description of Securities to be
Registered................................ Investment Considerations; Description of
Debentures; Description of Capital Stock
10. Interests of Named Experts and Counsel... Experts; Legal Opinions
11. Information With Respect to the
Registrant............................... Summary; Investment Considerations; The
Company; Use of Proceeds; Capitalization;
Selected Pro Forma Combined Condensed
Financial Data; Selected Consolidated
Financial Data for the Predecessor
Companies; Management's Discussion and
Analysis of Financial Condition and Results
of Operations for the Predecessor
Companies; Business; Management; Executive
Compensation and Related Matters; Principal
Stockholders; Certain Transactions;
Description of Debentures; Shares Eligible
for Future Sale; Consolidated Financial
Statements
12. Disclosure of Commission Position on
Indemnification for Securities Act
Liabilities.............................. Not Applicable
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<PAGE> 3
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
a. Exhibits
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1 Form of Underwriting Agreement.**
2 Agreement and Plan of Merger, dated as of August 1, 1994, as amended, by
and among the Predecessor Companies and the Company previously filed as
Exhibit 2 to the Company's Registration Statement No. 33-84534 on Form S-4
dated September 28, 1994.
3.1 Form of Restated Certificate of Incorporation of the Company previously
filed as Exhibit 3.1 to the Company's Registration Statement No. 33-84534
on Form S-4 dated September 28, 1994.
3.2 Form of By-laws of the Company previously filed as Exhibit 3.2 to the
Company's Registration Statement No. 33-84534 on Form S-4 dated September
28, 1994.
4.1 Form of Indenture between the Company and the Trustee (including form of
Debenture).***
4.2 Form of Rights Agreement between the Company and the Rights Agent
previously filed as Exhibit 4.2 to the Company's Registration Statement
No. 33-84534 on Form S-4 dated September 28, 1994.
5 Opinion of Fried, Frank, Harris, Shriver & Jacobson**.
10.1 Foundation Agreement between SPI Pharmaceuticals, Inc. and ICN Galenika
dated November 22, 1990 previously filed as Exhibit 10.35 to SPI's Annual
Report on Form 10-K for the year ended November 30, 1990.
10.2 Amendment to Foundation Agreement between SPI Pharmaceuticals, Inc. and
ICN Galenika dated December 31, 1991, previously filed as Exhibit 10.39 to
SPI's Annual Report on Form 10-K for the year ended December 31, 1991.
10.3 Additional Amendment to Foundation Agreement between SPI Pharmaceuticals,
Inc. and ICN Galenika dated February 27, 1992, previously filed as Exhibit
10.40 to SPI's Annual Report on Form 10-K for the year ended December 31,
1991.
10.4 Indenture between ICN Pharmaceuticals, Inc. and J. Henry Schroeder Bank &
Trust Company, previously filed as Exhibit 4.1 to Registration Statement
No. 33-5919 on Form S-3, which is incorporated herein by reference. First
Supplemental Indenture dated as of October 1, 1986, between ICN
Pharmaceuticals, Inc. and J. Henry Schroeder Bank & Trust Company.
10.5 Public Bond Issue Agreement dated as of June 13, 1985 between ICN
Pharmaceuticals, Inc. and Banque Gutzwiller, Kurz, Bungener S.A.,
previously filed as Exhibit 10 to ICN's Form 8 Amendment of Quarterly
Report on Form 10-Q for the quarter ended August 31, 1985.
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10.6 Purchase Agreement dated as of September 5, 1986, for an issue by ICN
Pharmaceuticals, Inc., of Dfl. 75,000,000 Subordinated Convertible Bonds
due 1990/ 1994 convertible into Shares of Common Stock, between ICN
Pharmaceuticals, Inc. and Van Haften & Co. N.V. and the other Managers
named therein; Trust Deed dated as of September 15, 1986, between ICN
Pharmaceuticals, Inc. and B.V. Algemeen Administratieen Trustkantoor; and
Paying Agency Agreement dated as of September 15, 1986, for an issue by
ICN Pharmaceuticals, Inc. of Dfl. 75,000,000 Subordinated Convertible
Bonds due 1990/1994 Convertible into Shares of Common Stock among ICN
Pharmaceuticals, Inc., Nederlands Credietbank N.V., Kerdietbank S.A.
Luxembourgeoise, and Banque Gutzwiller, Kurz, Bungener S.A., previously
filed as Exhibit 10 to ICN's Registration Statement No. 33-10706 on Form
S-3.
10.7 Xr Capital Holding Trust Instrument between ICN Pharmaceuticals, Inc. and
Ansbacher (C.I.) Limited dated as of September 17, 1986; Subscription
Agreement between Ansbacher (C.I.) Limited, ICN Pharmaceuticals, Inc., SPI
Pharmaceuticals, Inc., and Banque Gutzwiller, Kurz, Bungener S.A. and the
other financial institutions named therein dated as of September 17, 1986;
Bond Issue Agreement between ICN Pharmaceuticals, Inc. and Ansbacher
(C.I.) Limited dated as of September 17, 1986; and Exchange Agency
Agreement between ICN Pharmaceuticals, Inc., SPI Pharmaceuticals, Inc.,
Banque Gutzwiller, Kurz, Bungener S.A., and the other financial
institutions named therein dated as of September 17, 1986 previously filed
as Exhibit 10.36 to ICN Pharmaceuticals Inc.'s Annual Report on Form 10-K
for the fiscal year ended November 30, 1987.
10.8 Indenture dated as of October 30, 1986 between ICN Pharmaceuticals, Inc.
and Citibank, N.A.; and Subscription Agreement dated as of October 8, 1986
between ICN Pharmaceuticals, Inc., J. Henry Schroder Wagg and Co. Ltd. and
the other financial institutions named therein previously filed as Exhibit
10.37 to ICN's Pharmaceuticals Inc.'s Annual Report on Form 10-K for the
fiscal year ended November 30, 1987.
10.9 Pharma Capital Holdings Trust Instrument between ICN Pharmaceuticals, Inc.
and Ansbacher (C.I.) Limited, dated as of October 16, 1986; Subscription
Agreement between Ansbacher (C.I.) Limited, ICN Pharmaceuticals, Inc. and
the Managers named therein, dated as of October 16, 1986; Paying Agency
Agreement between ICN Pharmaceuticals, Inc., Ansbacher (C.I.) Limited,
Banque Paribas (Luxembourg) S.A. and the other financial institutions
named therein dated as of October 22, 1986; and the Exchange Agency
Agreement between ICN Pharmaceuticals, Inc., Banque Paribas (Luxembourg)
S.A. and the other Exchange Agents named therein dated as of October 22,
1986 previously filed as Exhibit 10.38 to ICN Pharmaceuticals, Inc.'s
Annual Report on Form 10-K for the fiscal year ended November 30, 1987.
10.10 Bio Capital Holding Trust Instrument between ICN Biomedicals, Inc.,
Ansbacher (C.I.) Limited and ICN Pharmaceuticals, Inc. dated as of January
26, 1987; Subscription Agreement between ICN Biomedicals, Inc., Ansbacher
(C.I.) Limited, ICN Pharmaceuticals, Inc., Banque Gutzwiller, Kurz,
Bungener S.A. and the other financial institutions named therein dated as
of January 26, 1987; Bond Issue Agreement between ICN Biomedicals, Inc.,
ICN Pharmaceuticals, Inc. and Ansbacher (C.I.) Limited dated as of January
26, 1987; Exchange Agency Agreement between ICN Biomedicals, Inc., Banque
Gutzwiller, Kurz, Bungener, S.A., and the other financial institutions
named therein dated as of January 26, 1987; and Guaranty between ICN
Pharmaceuticals, Inc. and ICN Biomedicals, Inc. dated as of February 17,
1987, previously filed as Exhibit 10.1 to ICN Biomedicals, Inc.'s
Quarterly Report on Form 10-Q for the quarter ended February 28, 1987.
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II-2
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10.11 Public Bond Issue Agreement dated as of February 20, 1987, between ICN
Pharmaceuticals, Inc. and Fintrelex, S.A. and the other banks named
therein; Conversion Agency Agreement dated as of February 20, 1987 between
ICN Pharmaceuticals, Inc., E. Gutzwiller & Cie, and the other financial
institutions named therein; and Escrow Agreement dated as of February 20,
1987 between ICN Pharmaceuticals, Inc., Fintrelex, S.A. and E. Gutzwiller
& Cie, previously filed as Exhibit 10.2 to ICN Pharmaceuticals Inc.'s
Quarterly Report on Form 10-Q for the quarter ended February 28, 1987.
10.12 Agreement between ICN Pharmaceuticals, Inc. and Milan Panic, dated October
1, 1988 previously filed as Exhibit 10.51 to ICN's Annual Report on Form
10-K for the year ended November 30, 1989.
10.13 Agreement among ICN Pharmaceuticals, Inc., SPI Pharmaceuticals, Inc. and
Adam Jerney, dated March 18, 1993 previously filed as Exhibit 10.49 to
SPI's Amendment No. 2 to the Annual Report on Form 10-K filed on March 31,
1993.
10.14 Agreement among ICN Pharmaceuticals, Inc., Viratek, Inc. and John
Giordani, dated March 18, 1993 previously filed as Exhibit 10.3 to the
Company's Registration Statement No. 33-84534 on Form S-4 dated September
28, 1994.
10.15 Agreement among ICN Pharmaceuticals, Inc., ICN Biomedicals, Inc., SPI
Pharmaceuticals and Bill MacDonald, dated March 18, 1993 previously filed
as Exhibit 10.4 to the Company's Registration Statement No. 33-84534 on
Form S-4 dated September 28, 1994.
10.16 Agreement among ICN Pharmaceuticals, Inc., SPI Pharmaceuticals, Inc. and
John Phillips, dated March 18, 1993 previously filed as Exhibit 10.49 to
Amendment No. 2 to SPI's Annual Report on Form 10-K filed on March 31,
1993.
10.17 Agreement among ICN Pharmaceuticals, Inc., SPI Pharmaceuticals, Inc. and
Jack Sholl, dated March 18, 1993 previously filed as Exhibit 10.49 to
Amendment No. 2 to SPI's Annual Report on Form 10-K filed on March 31,
1993.
10.18 Agreement among ICN Pharmaceuticals, Inc., SPI Pharmaceuticals, Inc. and
David Watt, dated March 18, 1993 previously filed as Exhibit 10.49 to
Amendment No. 2 to SPI's Annual Report on Form 10-K filed on March 31,
1993.
10.19 ICN Pharmaceuticals, Inc. 1992 Employee Incentive Stock Option Plan
previously filed as Exhibit 10.56 to ICN's Form 10-K for the year ended
December 31, 1992.
10.20 ICN Pharmaceuticals, Inc. 1992 Non-Qualified Stock Option Plan previously
filed as Exhibit 10.57 to ICN's Form 10-K for the year ended December 31,
1992.
10.21 SPI Pharmaceuticals, Inc. 1992 Employee Incentive Stock Option Plan
previously filed as Exhibit 10.42 to SPI's Form 10-K for the year ended
December 31, 1992.
10.22 SPI Pharmaceuticals, Inc. 1992 Non-Qualified Stock Option Plan previously
filed as Exhibit 10.43 to SPI's Form 10-K for the year ended December 31,
1992.
10.23 Viratek, Inc. 1992 Employee Incentive Stock Option Plan previously filed
as Exhibit 10.22 to Viratek's Registration Statement No. 33-54678 on Form
S-2.
10.24 Viratek, Inc. 1992 Non-Qualified Stock Option Plan previously filed as
Exhibit 10.23 to Viratek's Registration Statement No. 33-54678 on Form
S-2.
10.25 ICN Biomedicals, Inc. 1992 Employee Incentive Stock Option Plan previously
filed as Exhibit 10.22 to Biomedicals' Form 10-K for the year ended
December 31, 1992.
10.26 ICN Biomedicals, Inc. 1992 Non-Qualified Stock Option Plan previously
filed as Exhibit 10.23 to Biomedicals' Form 10-K for the year ended
December 31, 1992.
10.27 ICN Pharmaceuticals, Inc. 1981 Employee Incentive Stock Option Plan, as
amended, previously filed as Exhibit 4.1 to Registration Statement No.
33-60866 on Form S-3 dated April 9, 1993.
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II-3
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10.28 SPI Pharmaceuticals, Inc. 1982 Employee Incentive Stock Option Plan, as
amended and restated as of January 21, 1992, previously filed as Exhibit
4.1 to SPI's Registration Statement No. 33-60872 on Form S-8 dated April
9, 1993.
10.29 SPI Pharmaceuticals, Inc. 1982 Non-Qualified Stock Option Plan, as amended
and restated as of January 21, 1992, previously filed as Exhibit 4.2 to
SPI's Registration Statement No. 33-60872 on Form S-8 dated April 9, 1993.
10.30 Viratek, Inc. 1982 FDA Employee Special Stock Option Plan previously filed
as Exhibit 10.14 to Viratek's Form 10-K for the year ended November 30,
1982.
10.31 Viratek, Inc. 1981 Employee Incentive Stock Option Plan, as amended on
January 21, 1992, previously filed as Exhibit 4.1 to Viratek's
Registration Statement No. 33-60876 on Form S-8 dated April 9, 1993.
10.32 Viratek, Inc. 1980 Employee Stock Option Plan, as amended, previously
filed as Exhibit 4.2 to Viratek's Registration Statement No. 33-60876 on
Form S-8 dated April 9, 1993.
10.33 ICN Biomedicals, Inc. 1992 Employee Incentive Stock Option Plan previously
filed as Exhibit 4.1 to Biomedicals' Registration Statement No. 33-60862
on Form S-8 dated April 9, 1993.
10.34 ICN Biomedicals, Inc. 1983 Non-Qualified Stock Option Plan and 1983
Incentive Stock Option Plan, as amended and restated as of January 21,
1992, previously filed as Exhibits 4.1 and 4.2 to Biomedicals'
Registration Statement No. 33-34943 on Form S-8 dated April 9, 1993.
11.1 Statement Re Computation of Per Share Earnings ICN Merger Corp.***
11.2 Statement Re Computation of Per Share Earnings SPI Pharmaceuticals,
Inc.***
11.3 Statement Re Computation of Per Share Earnings ICN Pharmaceuticals,
Inc.***
11.4 Statement Re Computation of Per Share Earnings Viratek, Inc.***
11.5 Statement Re Computation of Per Share Earnings ICN Biomedicals, Inc.***
12 Calculation of Ratio of Earnings to Fixed Charges.***
15 Letter from Coopers & Lybrand, L.L.P. concerning unaudited interim
financial information.***
21 Subsidiaries of the Registrant previously filed as Exhibit 21 to the
Company's Registration Statement No. 33-84534 on Form S-4 dated September
28, 1994.
23.1 Consent of Coopers & Lybrand, L.L.P.***
23.2 Consent of Fried, Frank, Harris, Shriver & Jacobson (contained in its
opinion filed as Exhibit 5 to this Registration Statement).**
23.3.1 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Michael Smith*
23.3.2 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Stephen Moses*
23.3.3 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Norman Barker*
23.3.4 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Roger Guillermin*
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23.3.5 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Birch Bayh*
23.3.6 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Vernon Knight*
23.3.7 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Weldon Jolley*
23.3.8 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Jean-Francois Kurz*
23.3.9 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Thomas Lenagh*
23.3.10 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Charles Manatt*
23.3.11 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Milan Panic*
23.3.12 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Roberts A. Smith*
23.3.13 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Robert Finch*
23.3.14 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Adam Jerney*
23.3.15 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
James Miscoll*
23.3.16 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Alan Charles*
23.3.17 Consent of Persons who will become directors of the Registrant (as
required by Rule 438)
Richard Starr*
24.1 Power of Attorney (included elsewhere in this Registration Statement).
25.1 Statement of Eligibility of Trustee (Form T-1).***
27. Financial Data Schedule for ICN Pharmaceuticals, Inc. for year ended
December 31, 1993 and for the six month period June 30, 1994, previously
filed as Exhibit 27 to the Company's Registration Statement No. 33-84534
on Form S-4 dated September 28, 1994.
27.1 Financial Data Schedule for SPI Pharmaceuticals, Inc. for year ended
December 31, 1993 and for the six month period ended June 30, 1994,
previously filed as Exhibit 27.1 to the Company's Registration Statement
No. 33-84534 on Form S-4 dated September 28, 1994.
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27.2 Financial Data Schedule for Viratek, Inc. for year ended December 31, 1993
and for the six month period ended June 30, 1994, previously filed as
Exhibit 27.2 to the Company's Registration Statement No. 33-84534 on Form
S-4 dated September 28, 1994.
27.3 Financial Data Schedule for ICN Biomedicals, Inc. for year ended December
31, 1993 and for the six month period ended June 30, 1994, previously
filed as Exhibit 27.3 to the Company's Registration Statement No. 33-84534
on Form S-4 dated September 28, 1994.
99.1 Form of Escrow Deposit Agreement between the Registrant and American Stock
Transfer & Trust Company, as escrow agent.**
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* To be filed by amendment.
** Filed herewith.
*** Previously filed as an Exhibit to this Registration Statement.
II-6
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, ICN Merger
Corp. has duly caused this Registration Statement to be signed on its behalf by
the undersigned, thereunto duly authorized in the City of Costa Mesa, State of
California, on November 4, 1994.
ICN MERGER CORP.
By: /s/ MILAN PANIC
Milan Panic
Chairman of the Board, President
and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned constitutes
and appoints Milan Panic and David C. Watt, and each of them, his true and
lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments to this Registration Statement
(including post-effective amendments), and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission granting unto such attorneys-in-fact and agents, and each of
them, full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully and to
all intents and purposes as he might or could do in person, hereby ratifying and
confirming all that such attorneys-in-fact and agents, or any of them, or their
or his 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 below by the following persons in the
capacities and on the dates indicated.
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SIGNATURE TITLE DATE
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/s/ MILAN PANIC Chairman of the Board, President, November 4, 1994
Milan Panic and Chief Executive Officer
(Principal Executive Officer)
/s/ JOHN E. GIORDANI Executive Vice President, Chief November 4, 1994
John E. Giordani Financial Officer and Corporate
Controller (Principal Financial
and Accounting Officer) and
Director
/s/ BILL A. MACDONALD Director November 4, 1994
Bill A. MacDonald
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EXHIBIT INDEX
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SEQUENTIALLY
NUMBERED
NUMBER DESCRIPTION PAGE
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1 Form of Underwriting Agreement**..............................
2 Agreement and Plan of Merger, dated as of August 1, 1994, as
amended, by and among the Predecessor Companies and the
Company previously filed as Exhibit 2 to the Company's
Registration Statement No. 33-84534 on Form S-4 dated
September 28, 1994............................................
3.1 Form of Restated Certificate of Incorporation of the Company
previously filed as Exhibit 3.1 to the Company's Registration
Statement No. 33-84534 on Form S-4 dated September 28, 1994...
3.2 Form of By-laws of the Company previously filed as Exhibit 3.2
to the Company's Registration Statement No. 33-84534 on Form
S-4 dated September 28, 1994..................................
4.1 Form of Indenture between the Company and the Trustee
(including form of Debenture)***..............................
4.2 Form of Rights Agreement between the Company and the Rights
Agent previously filed as Exhibit 4.2 to the Company's
Registration Statement No. 33-84534 on Form S-4 dated
September 28, 1994............................................
5 Opinion of Fried, Frank, Harris, Shriver & Jacobson**.........
10.1 Foundation Agreement between SPI Pharmaceuticals, Inc. and ICN
Galenika dated November 22, 1990 previously filed as Exhibit
10.35 to SPI's Annual Report on Form 10-K for the year ended
November 30, 1990.............................................
10.2 Amendment to Foundation Agreement between SPI Pharmaceuticals,
Inc. and ICN Galenika dated December 31, 1991, previously
filed as Exhibit 10.39 to SPI's Annual Report on Form 10-K for
the year ended December 31, 1991..............................
10.3 Additional Amendment to Foundation Agreement between SPI
Pharmaceuticals, Inc. and ICN Galenika dated February 27,
1992, previously filed as Exhibit 10.40 to SPI's Annual Report
on Form 10-K for the year ended December 31, 1991.............
10.4 Indenture between ICN Pharmaceuticals, Inc. and J. Henry
Schroeder Bank & Trust Company, previously filed as Exhibit
4.1 to Registration Statement No. 33-5919 on Form S-3, which
is incorporated herein by reference. First Supplemental
Indenture dated as of October 1, 1986, between ICN
Pharmaceuticals, Inc. and J. Henry Schroeder Bank & Trust
Company.......................................................
10.5 Public Bond Issue Agreement dated as of June 13, 1985 between
ICN Pharmaceuticals, Inc. and Banque Gutzwiller, Kurz,
Bungener S.A., previously filed as Exhibit 10 to ICN's Form 8
Amendment of Quarterly Report on Form 10-Q for the quarter
ended August 31, 1985.........................................
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SEQUENTIALLY
NUMBERED
NUMBER DESCRIPTION PAGE
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10.6 Purchase Agreement dated as of September 5, 1986, for an issue
by ICN Pharmaceuticals, Inc., of Dfl. 75,000,000 Subordinated
Convertible Bonds due 1990/1994 convertible into Shares of
Common Stock, between ICN Pharmaceuticals, Inc. and Van Haften
& Co. N.V. and the other Managers named therein; Trust Deed
dated as of September 15, 1986, between ICN Pharmaceuticals,
Inc. and B.V. Algemeen Administratieen Trustkantoor; and
Paying Agency Agreement dated as of September 15, 1986, for an
issue by ICN Pharmaceuticals, Inc. of Dfl. 75,000,000
Subordinated Convertible Bonds due 1990/1994 Convertible into
Shares of Common Stock among ICN Pharmaceuticals, Inc.,
Nederlands Credietbank N.V., Kerdietbank S.A. Luxembourgeoise,
and Banque Gutzwiller, Kurz, Bungener S.A., previously filed
as Exhibit 10 to ICN's Registration Statement No. 33-10706 on
Form S-3......................................................
10.7 Xr Capital Holding Trust Instrument between ICN
Pharmaceuticals, Inc. and Ansbacher (C.I.) Limited dated as of
September 17, 1986; Subscription Agreement between Ansbacher
(C.I.) Limited, ICN Pharmaceuticals, Inc., SPI
Pharmaceuticals, Inc., and Banque Gutzwiller, Kurz, Bungener
S.A. and the other financial institutions named therein dated
as of September 17, 1986; Bond Issue Agreement between ICN
Pharmaceuticals, Inc. and Ansbacher (C.I.) Limited dated as of
September 17, 1986; and Exchange Agency Agreement between ICN
Pharmaceuticals, Inc., SPI Pharmaceuticals, Inc., Banque
Gutzwiller, Kurz, Bungener S.A., and the other financial
institutions named therein dated as of September 17, 1986
previously filed as Exhibit 10.36 to ICN Pharmaceuticals
Inc.'s Annual Report on Form 10-K for the fiscal year ended
November 30, 1987.............................................
10.8 Indenture dated as of October 30, 1986 between ICN
Pharmaceuticals, Inc. and Citibank, N.A.; and Subscription
Agreement dated as of October 8, 1986 between ICN
Pharmaceuticals, Inc., J. Henry Schroder Wagg and Co. Ltd. and
the other financial institutions named therein previously
filed as Exhibit 10.37 to ICN's Pharmaceuticals Inc.'s Annual
Report on Form 10-K for the fiscal year ended November 30,
1987..........................................................
10.9 Pharma Capital Holdings Trust Instrument between ICN
Pharmaceuticals, Inc. and Ansbacher (C.I.) Limited, dated as
of October 16, 1986; Subscription Agreement between Ansbacher
(C.I.) Limited, ICN Pharmaceuticals, Inc. and the Managers
named therein, dated as of October 16, 1986; Paying Agency
Agreement between ICN Pharmaceuticals, Inc., Ansbacher (C.I.)
Limited, Banque Paribas (Luxembourg) S.A. and the other
financial institutions named therein dated as of October 22,
1986; and the Exchange Agency Agreement between ICN
Pharmaceuticals, Inc., Banque Paribas (Luxembourg) S.A. and
the other Exchange Agents named therein dated as of October
22, 1986 previously filed as Exhibit 10.38 to ICN
Pharmaceuticals, Inc.'s Annual Report on Form 10-K for the
fiscal year ended November 30, 1987...........................
</TABLE>
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10.10 Bio Capital Holding Trust Instrument between ICN Biomedicals,
Inc., Ansbacher (C.I.) Limited and ICN Pharmaceuticals, Inc.
dated as of January 26, 1987; Subscription Agreement between
ICN Biomedicals, Inc., Ansbacher (C.I.) Limited, ICN
Pharmaceuticals, Inc., Banque Gutzwiller, Kurz, Bungener S.A.
and the other financial institutions named therein dated as of
January 26, 1987; Bond Issue Agreement between ICN
Biomedicals, Inc., ICN Pharmaceuticals, Inc. and Ansbacher
(C.I.) Limited dated as of January 26, 1987; Exchange Agency
Agreement between ICN Biomedicals, Inc., Banque Gutzwiller,
Kurz, Bungener, S.A., and the other financial institutions
named therein dated as of January 26, 1987; and Guaranty
between ICN Pharmaceuticals, Inc. and ICN Biomedicals, Inc.
dated as of February 17, 1987, previously filed as Exhibit
10.1 to ICN Biomedicals, Inc.'s Quarterly Report on Form 10-Q
for the quarter ended February 28, 1987.......................
10.11 Public Bond Issue Agreement dated as of February 20, 1987,
between ICN Pharmaceuticals, Inc. and Fintrelex, S.A. and the
other banks named therein; Conversion Agency Agreement dated
as of February 20, 1987 between ICN Pharmaceuticals, Inc., E.
Gutzwiller & Cie, and the other financial institutions named
therein; and Escrow Agreement dated as of February 20, 1987
between ICN Pharmaceuticals, Inc., Fintrelex, S.A. and E.
Gutzwiller & Cie, previously filed as Exhibit 10.2 to ICN
Pharmaceuticals Inc.'s Quarterly Report on Form 10-Q for the
quarter ended February 28, 1987...............................
10.12 Agreement between ICN Pharmaceuticals, Inc. and Milan Panic,
dated October 1, 1988 previously filed as Exhibit 10.51 to
ICN's Annual Report on Form 10-K for the year ended November
30, 1989......................................................
10.13 Agreement among ICN Pharmaceuticals, Inc., SPI
Pharmaceuticals, Inc. and Adam Jerney, dated March 18, 1993
previously filed as Exhibit 10.49 to SPI's Amendment No. 2 to
the Annual Report on Form 10-K filed on March 31, 1993........
10.14 Agreement among ICN Pharmaceuticals, Inc., Viratek, Inc. and
John Giordani, dated March 18, 1993 previously filed as
Exhibit 10.3 to the Company's Registration Statement No.
33-84534 on Form S-4 dated September 28, 1994.................
10.15 Agreement among ICN Pharmaceuticals, Inc., ICN Biomedicals,
Inc., SPI Pharmaceuticals and Bill MacDonald, dated March 18,
1993 previously filed as Exhibit 10.4 to the Company's
Registration Statement No. 33-84534 on Form S-4 dated
September 28, 1994............................................
10.16 Agreement among ICN Pharmaceuticals, Inc., SPI
Pharmaceuticals, Inc. and John Phillips, dated March 18, 1993
previously filed as Exhibit 10.49 to Amendment No. 2 to SPI's
Annual Report on Form 10-K filed on March 31, 1993............
10.17 Agreement among ICN Pharmaceuticals, Inc., SPI
Pharmaceuticals, Inc. and Jack Sholl, dated March 18, 1993
previously filed as Exhibit 10.49 to Amendment No. 2 to SPI's
Annual Report on Form 10-K filed on March 31, 1993............
</TABLE>
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10.18 Agreement among ICN Pharmaceuticals, Inc., SPI
Pharmaceuticals, Inc. and David Watt, dated March 18, 1993
previously filed as Exhibit 10.49 to Amendment No. 2 to SPI's
Annual Report on Form 10-K filed on March 31, 1993............
10.19 ICN Pharmaceuticals, Inc. 1992 Employee Incentive Stock Option
Plan previously filed as Exhibit 10.56 to ICN's Form 10-K for
the year ended December 31, 1992..............................
10.20 ICN Pharmaceuticals, Inc. 1992 Non-Qualified Stock Option Plan
previously filed as Exhibit 10.57 to ICN's Form 10-K for the
year ended December 31, 1992..................................
10.21 SPI Pharmaceuticals, Inc. 1992 Employee Incentive Stock Option
Plan previously filed as Exhibit 10.42 to SPI's Form 10-K for
the year ended December 31, 1992..............................
10.22 SPI Pharmaceuticals, Inc. 1992 Non-Qualified Stock Option Plan
previously filed as Exhibit 10.43 to SPI's Form 10-K for the
year ended December 31, 1992..................................
10.23 Viratek, Inc. 1992 Employee Incentive Stock Option Plan
previously filed as Exhibit 10.22 to Viratek's Registration
Statement No. 33-54678 on Form S-2............................
10.24 Viratek, Inc. 1992 Non-Qualified Stock Option Plan previously
filed as Exhibit 10.23 to Viratek's Registration Statement No.
33-54678 on Form S-2..........................................
10.25 ICN Biomedicals, Inc. 1992 Employee Incentive Stock Option
Plan previously filed as Exhibit 10.22 to Biomedicals' Form
10-K for the year ended December 31, 1992.....................
10.26 ICN Biomedicals, Inc. 1992 Non-Qualified Stock Option Plan
previously filed as Exhibit 10.23 to Biomedicals' Form 10-K
for the year ended December 31, 1992..........................
10.27 ICN Pharmaceuticals, Inc. 1981 Employee Incentive Stock Option
Plan, as amended, previously filed as Exhibit 4.1 to
Registration Statement No. 33-60866 on Form S-3 dated April 9,
1993..........................................................
10.28 SPI Pharmaceuticals, Inc. 1982 Employee Incentive Stock Option
Plan, as amended and restated as of January 21, 1992,
previously filed as Exhibit 4.1 to SPI's Registration
Statement No. 33-60872 on Form S-8 dated April 9, 1993........
10.29 SPI Pharmaceuticals, Inc. 1982 Non-Qualified Stock Option
Plan, as amended and restated as of January 21, 1992,
previously filed as Exhibit 4.2 to SPI's Registration
Statement No. 33-60872 on Form S-8 dated April 9, 1993........
10.30 Viratek, Inc. 1982 FDA Employee Special Stock Option Plan
previously filed as Exhibit 10.14 to Viratek's Form 10-K for
the year ended November 30, 1982..............................
10.31 Viratek, Inc. 1981 Employee Incentive Stock Option Plan, as
amended on January 21, 1992, previously filed as Exhibit 4.1
to Viratek's Registration Statement No. 33-60876 on Form S-8
dated April 9, 1993...........................................
</TABLE>
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10.32 Viratek, Inc. 1980 Employee Stock Option Plan, as amended,
previously filed as Exhibit 4.2 to Viratek's Registration
Statement No. 33-60876 on Form S-8 dated April 9, 1993........
10.33 ICN Biomedicals, Inc. 1992 Employee Incentive Stock Option
Plan previously filed as Exhibit 4.1 to Biomedicals'
Registration Statement No. 33-60862 on Form S-8 dated April 9,
1993..........................................................
10.34 ICN Biomedicals, Inc. 1983 Non-Qualified Stock Option Plan and
1983 Incentive Stock Option Plan, as amended and restated as
of January 21, 1992, previously filed as Exhibits 4.1 and 4.2
to Biomedicals' Registration Statement No. 33-34943 on Form
S-8 dated April 9, 1993.......................................
11.1 Statement Re Computation of Per Share Earnings ICN Merger
Corp.***......................................................
11.2 Statement Re Computation of Per Share Earnings SPI
Pharmaceuticals, Inc.***......................................
11.3 Statement Re Computation of Per Share Earnings ICN
Pharmaceuticals, Inc.***......................................
11.4 Statement Re Computation of Per Share Earnings Viratek,
Inc.***.......................................................
11.5 Statement Re Computation of Per Share Earnings ICN
Biomedicals, Inc.***..........................................
12 Calculation of Ratio of Earnings to Fixed Charges***..........
15 Letter from Coopers & Lybrand, L.L.P. concerning unaudited
interim financial information***..............................
21 Subsidiaries of the Registrant previously filed as Exhibit 21
to the Company's Registration Statement No. 33-84534 on Form
S-4 dated September 28, 1994..................................
23.1 Consent of Coopers & Lybrand, L.L.P.***.......................
23.2 Consent of Fried, Frank, Harris, Shriver & Jacobson (contained
in its opinion filed as Exhibit 5 to this Registration
Statement)**..................................................
23.3.1 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Michael Smith*................................................
23.3.2 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Stephen Moses*................................................
23.3.3 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Norman Barker*................................................
23.3.4 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Roger Guillermin*.............................................
23.3.5 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Birch Bayh*...................................................
23.3.6 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Vernon Knight*................................................
</TABLE>
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23.3.7 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Weldon Jolley*................................................
23.3.8 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Jean-Francois Kurz*...........................................
23.3.9 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Thomas Lenagh*................................................
23.3.10 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Charles Manatt*...............................................
23.3.11 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Milan Panic*..................................................
23.3.12 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Roberts A. Smith*.............................................
23.3.13 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Robert Finch*.................................................
23.3.14 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Adam Jerney*..................................................
23.3.15 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
James Miscoll*................................................
23.3.16 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Alan Charles*.................................................
23.3.17 Consent of Persons who will become directors of the Registrant
(as required by Rule 438)
Richard Starr*................................................
24.1 Power of Attorney (included elsewhere in this Registration
Statement)....................................................
25.1 Statement of Eligibility of Trustee (Form T-1)***.............
27. Financial Data Schedule for ICN Pharmaceuticals, Inc. for year
ended December 31, 1993 and for the six month period June 30,
1994, previously filed as Exhibit 27 to the Company's
Registration Statement No. 33-84534 on Form S-4 dated
September 28, 1994............................................
27.1 Financial Data Schedule for SPI Pharmaceuticals, Inc. for year
ended December 31, 1993 and for the six month period ended
June 30, 1994, previously filed as Exhibit 27.1 to the
Company's Registration Statement No. 33-84534 on Form S-4
dated September 28, 1994......................................
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27.2 Financial Data Schedule for Viratek, Inc. for year ended
December 31, 1993 and for the six month period ended June 30,
1994, previously filed as Exhibit 27.2 to the Company's
Registration Statement No. 33-84534 on Form S-4 dated
September 28, 1994............................................
27.3 Financial Data Schedule for ICN Biomedicals, Inc. for year
ended December 31, 1993 and for the six month period ended
June 30, 1994, previously filed as Exhibit 27.3 to the
Company's Registration Statement No. 33-84534 on Form S-4
dated September 28, 1994......................................
99.1 Form of Escrow Deposit Agreement between the Registrant and
American Stock Transfer & Trust Company, as escrow agent**....
</TABLE>
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* To be filed by amendment.
** Filed herewith.
*** Previously filed as an Exhibit to this Registration Statement.
<PAGE> 1
EXHIBIT 1
ICN MERGER CORP.
$150,000,000
% CONVERTIBLE SUBORDINATED
DEBENTURES DUE 2004
------------------------
UNDERWRITING AGREEMENT
New York, New York
, 1994
WERTHEIM SCHRODER & CO. INCORPORATED
As Representative of the several
Underwriters named in Schedule I hereto
c/o Wertheim Schroder & Co. Incorporated
Equitable Center
787 Seventh Avenue
New York, New York 10019-6016
Dear Sirs:
ICN Merger Corp., a Delaware corporation (the "Company"), proposes, subject
to the terms and conditions stated herein, to issue and sell to the Underwriters
named in Schedule I hereto (the "Underwrit ers"), $150,000,000 aggregate
principal amount of % Convertible Subordinated Debentures Due 2004 of the
Company pursuant to an indenture (the "Indenture") dated as of ,
1994 between the Company and , as trustee (the "Trustee"). The
$150,000,000 aggregate principal amount of such Debentures to be sold by the
Company are herein referred to as the "Firm Securities." In addition, the
Company proposes to grant to the Underwriters an option to purchase up to an
additional $22,500,000 aggregate principal amount of Debentures (the "Option
Securities"), on the terms and for the purposes set forth in Section 2 hereof.
The Firm Securities and the Option Securities are herein collectively referred
to as the "Securities." All references to "New ICN" mean, collectively, ICN
Merger Corp., SPI Pharmaceuticals, Inc. ("SPI"), ICN Pharmaceuticals, Inc.
("ICN"), Viratek, Inc. ("Viratek"), and ICN Biomedicals, Inc. ("Biomedicals"),
after giving effect to the Merger (as defined below). SPI, ICN, Viratek and
Biomedicals are sometimes referred to collectively herein as the "Predecessor
Companies".
1. The Company and each of the Predecessor Companies represent and warrant
to, and agree with, jointly and severally, each of the Underwriters that:
(a) A registration statement on Form S-1 (File No. 33-83952) and as a
part thereof a preliminary prospectus, in respect of the Securities and the
shares (the "Conversion Shares") of common stock, par value $.01 per share,
of the Company ("Common Stock") into which the Securities are convertible,
has been filed with the Securities and Exchange Commission (the
"Commission") in the form heretofore delivered to you and, with the
exception of exhibits to the registration statement, to you for each of the
other Underwriters; if such registration statement has not become
effective, an amendment (the "Final Amendment") to such registration
statement, including a form of final prospectus, necessary to permit such
registration statement to become effective, will promptly be filed by the
Company with the Commission; if such registration statement has become
effective and any post-effective amendment to such registration statement
has been filed with the Commission prior to the execution and delivery of
this Agreement, which amendment or amendments shall be in form acceptable
to you, the most recent such amendment has been declared effective by the
Commission; if such registration statement has become effective, a final
prospectus (the "Rule 430A Prospectus") relating to the Securities
containing information permitted to be omitted at the time of effectiveness
by Rule 430A of the rules and regulations
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<PAGE> 2
of the Commission under the Securities Act of 1933, as amended (the "Act"),
will promptly be filed by the Company pursuant to Rule 424(b) of the rules
and regulations of the Commission under the Act (any preliminary prospectus
filed as part of such registration statement being herein called a
"Preliminary Prospectus," such registration statement as amended at the
time that it becomes or became effective, or, if applicable, as amended at
the time the most recent post-effective amendment to such registration
statement filed with the Commission prior to the execution and delivery of
this Agreement became effective (the "Effective Date"), including all
exhibits thereto and all information deemed to be a part thereof at such
time pursuant to Rule 430A of the rules and regulations of the Commission
under the Act, being herein called the "Registration Statement" and the
final prospectus relating to the Securities in the form first filed
pursuant to Rule 424(b)(1) or (4) of the rules and regulations of the
Commission under the Act or, if no such filing is required, the form of
final prospectus included in the Registration Statement, being herein
called the "Prospectus").
(b) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary
Prospectus, at the time of filing thereof, conformed in all material
respects to the requirements of the Act and the rules and regulations of
the Commission thereunder, and did not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter through
you expressly for use therein;
(c) On the Effective Date and the date the Prospectus is filed with
the Commission, and when any further amendment or supplements thereto
become effective or are filed with the Commission, as the case may be, the
Registration Statement, the Prospectus and such amendment or supplements
did and will conform in all material respects to the requirements of the
Act and the rules and regulations of the Commission thereunder, and did not
and will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in
writing to the Company by an Underwriter through you expressly for use
therein;
(d) The representations and warranties of the Company and each of the
Predecessor Companies set forth in Section 4 of the Agreement and Plan of
Merger dated as of August 1, 1994, as amended (the "Merger Agreement")
among the Company and the Predecessor Companies relating to the merger (the
"Merger") among the Company, ICN, SPI and Viratek, with the Company as the
surviving entity (including the merger of Biomedicals into a wholly-owned
subsidiary of the Company), are hereby repeated as of the date hereof and
incorporated herein by reference for the benefit of the Underwriters. Each
of the conditions set forth in Section 6 of the Merger Agreement (other
than the condition set forth in paragraph 6.8 of Section 6) has been
satisfied or waived on or prior to the date hereof;
(e) Each of the Company and the Predecessor Companies has all
requisite power and authority to execute, deliver and perform its
obligations under this Agreement; the execution, delivery and performance
by the Company and the Predecessor Companies of their obligations under
this Agreement have been duly and validly authorized by all requisite
corporate action of the Company and the Predecessor Companies; and this
Agreement constitutes the legal, valid and binding obligation of the
Company and the Predecessor Companies, enforceable against the Company and
the Predecessor Companies in accordance with its terms;
(f) The Company has all requisite power and authority to execute,
deliver and perform its obligations under the Escrow and Deposit Agreement
to be dated , 1994 (the "Deposit Agreement") between
, as escrow agent, and the Company; the execution, delivery
and performance by the Company of its obligations under the Deposit
Agreement has been duly and validly authorized by all requisite corporate
action of the Company; and the Deposit Agreement constitutes the
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<PAGE> 3
legal, valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms;
(g) Neither the Company, the Predecessor Companies nor any of their
subsidiaries has sustained since December 31, 1993, any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, which loss or interference
is material to the Company, the Predecessor Companies and their
subsidiaries, taken as a whole; and, since the respective dates as of which
information is given in the Registration Statement and the Prospectus, and,
except as otherwise set forth in the Prospectus, there has not been, and
prior to the Time of Delivery (as defined in Section 4 hereof) there will
not be, any change in the capital stock (other than shares issued pursuant
to exercise of employee stock options that the Prospectus indicates are
outstanding (the "Employee Option Shares") or shares issued upon the
conversion of convertible securities or upon the exercise of warrants the
Prospectus indicates are outstanding) or short-term debt (other than an
immaterial change in short-term debt in the ordinary course of business) or
long-term debt of the Company or the Predecessor Companies or any of their
subsidiaries, or any material adverse change, or any development involving
a prospective material adverse change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company, the Predecessor Companies and their
subsidiaries, taken as a whole, otherwise than as set forth or contemplated
in the Prospectus;
(h) The Company, the Predecessor Companies and their subsidiaries have
good and marketable title in fee simple to all real property and good and
marketable title to all personal property owned by them, in each case free
and clear of all liens, encumbrances and defects except such as are
described or contemplated by the Prospectus, or such as do not materially
affect the value of such property and do not interfere in any material
respect with the use made and proposed to be made of such property by the
Company, the Predecessor Companies and their subsidiaries, and any real
property and buildings held under lease by the Company, the Predecessor
Companies and their subsidiaries are held by them under valid, subsisting
and enforceable leases with such exceptions as are not material and do not
interfere in any material respect with the use made and proposed to be made
of such real property and buildings by the Company, the Predecessor
Companies and their subsidiaries;
(i) Each of the Company and the Predecessor Companies has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the State of Delaware, and has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
property, or conducts any business, so as to require such qualification
(except where the failure to so qualify would not have a material adverse
effect on the Company or Predecessor Company, as the case may be, or the
Company, the Predecessor Companies and their subsidiaries considered as a
whole); and each of the Company's and the Predecessor Company's
subsidiaries has been duly incorporated and is validly existing as a
corporation in good standing under the laws of its jurisdiction of
incorporation, and has been duly qualified as a foreign corporation for the
transaction of business and is in good standing under the laws of each
other jurisdiction in which it owns or leases property, or conducts any
business, so as to require such qualification (except where the failure to
so qualify would not have a material adverse effect on the Company or
Predecessor Company, as the case may be, and their subsidiaries considered
as a whole); and each of the Company or Predecessor Companies, as the case
may be, and their subsidiaries has all necessary power and authority
(corporate and other) required to own its properties and conduct its
business as described in the Prospectus;
(j) Each of the Company and the Predecessor Companies has an
authorized, issued and outstanding capitalization as set forth in the
Registration Statement, and all of the outstanding shares of capital stock
of the Company and the Predecessor Companies have been duly and validly
authorized and issued, are fully paid and non-assessable, are free of any
preemptive or similar rights, were issued and sold in compliance with the
applicable Federal and state securities laws and conform in all material
respects to the descriptions thereof in the Prospectus; the Common Stock
has been registered under the Exchange Act and has been approved for
listing on the New York Stock Exchange, subject to official notice of
issuance; except as described in the Prospectus, there are no outstanding
options, warrants or other rights
-3-
<PAGE> 4
calling for the issuance of, and there are no commitments, plans or
arrangements to issue, any shares of capital stock of the Company or any
Predecessor Companies or any security convertible or exchangeable or
exercisable for capital stock of the Company; there are no holders of
securities of the Company or any Predecessor Company who, by reason of the
filing of the Registration Statement have the right (and have not waived
such right) to request the Company or a Predecessor Company, as the case
may be, to include in the Registration Statement securities owned by them;
and all of the outstanding shares of capital stock of each subsidiary of
the Company and the Predecessor Companies have been duly and validly
authorized and issued, are fully paid and non-assessable and, except as
otherwise described in the Prospectus, are owned by the Company or the
Predecessor Companies, as the case may be, free and clear of all liens,
encumbrances, equities or claims; and there are no outstanding options,
warrants or other rights calling for the issuance of, and there are no
commitments, plans or arrangements to issue, any shares of capital stock of
any subsidiary or any security convertible or exchangeable or exercisable
for capital stock of any subsidiary; and the shares of Common Stock into
which the Securities are convertible (the "Conversion Shares") have been
duly and validly authorized and reserved for issuance, and such shares,
when issued and delivered in accordance with the provisions of the
Securities and the Indenture, will be duly and validly issued, fully paid
and non-assessable, and, if issued on the date hereof, would conform to the
description of the Common Stock contained in the Prospectus;
(k) The Securities to be issued and sold by the Company to the
Underwriters hereunder have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will
constitute legal, valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms; the Securities will be
entitled to the benefits of the Indenture; the Indenture has been duly
authorized and, when duly executed and delivered by the Company and the
Trustee, will constitute a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms; the
Securities and the Indenture will conform in all material respects to the
descriptions thereof in the Prospectus; and the Securities have been
approved for listing, subject to official notice of issuance, on the New
York Stock Exchange;
(l) The issue and sale of the Securities and the compliance by the
Company with all of the provisions of the Securities and the Indenture, the
entering into and performance of this Agreement and the Deposit Agreement
and the consummation of the transactions herein and therein contemplated
will not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or
instrument to which the Company, the Predecessor Companies or any of their
subsidiaries is a party or by which the Company, the Predecessor Companies
or any of their subsidiaries is bound or to which any of the property or
assets of the Company, the Predecessor Companies or any of their
subsidiaries is subject, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company, the
Predecessor Companies or any of their subsidiaries (except for any
conflict, breach or violation, or any lien, charge or encumbrance which
will not individually or in the aggregate have a material adverse effect on
the business, operations, financial condition or business prospects of the
Company, the Predecessor Companies and their subsidiaries considered as a
whole); nor will such action result in any violation of the provisions of
the Certificate of Incorporation (or equivalent document) or the By-laws
(or equivalent document), in each case as amended, of the Company, the
Predecessor Companies or any of their subsidiaries; nor will such action
result in any violation of any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the
Company, the Predecessor Companies or any of their subsidiaries or any of
their properties (except for any violations which will not individually or
in the aggregate have a material adverse effect on the business,
operations, financial condition or business prospects of the Company, the
Predecessor Companies and their subsidiaries considered as a whole); and no
consent, approval, authorization, order, registration or qualification of
or with any court or governmental agency or body is required for the issue
and sale of the Securities or the consummation of the other transactions
contemplated by this Agreement and the Deposit Agreement, except the
registration under the Act of the Securities and the Conversion Shares, the
qualification of the Indenture under the Trust Indenture Act of 1939, and
such consents,
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<PAGE> 5
approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Securities by the Underwriters;
(m) There are no legal or governmental proceedings pending to which
the Company, the Predecessor Companies or any of their subsidiaries is a
party or of which any property of the Company, the Predecessor Companies or
any of their subsidiaries is the subject, other than litigation incident to
the business conducted by the Company, the Predecessor Companies and their
subsidiaries which will not individually or in the aggregate have a
material adverse effect on the financial position, stockholders' equity or
results of operations of the Company, the Predecessor Companies and their
subsidiaries considered as a whole, otherwise than as described in the
Prospectus; and, to the best of the Company's and the Predecessor Company's
knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened or contemplated by others; and
neither the Company, the Predecessor Companies nor any of their
subsidiaries is involved in any material labor dispute, nor, to the
Company's knowledge, is any material labor dispute threatened;
(n) The Company, the Predecessor Companies and their subsidiaries have
such licenses, permits and other approvals or authorizations of and from
governmental or regulatory authorities ("Permits") as are necessary under
applicable law to own their respective properties and to conduct their
respective businesses substantially in the manner now being conducted and
as described in the Prospectus; and the Company, the Predecessor Companies
and their subsidiaries have fulfilled and performed in all material
respects all of their respective obligations with respect to such Permits,
and no event has occurred which allows, or after notice or lapse of time or
both would allow, revocation or termination thereof or result in any other
material impairment of the rights of the holder of any such permits;
(o) Coopers & Lybrand and Arthur Andersen & Co., who have certified
certain financial statements of the Predecessor Companies and their
subsidiaries on a consolidated basis, are or were independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder;
(p) (i) The consolidated financial statements of the Predecessor
Companies and their subsidiaries included in the Registration Statement and
the Prospectus present fairly the financial condition, the results of
operations and the cash flows of the Predecessor Companies and their
subsidiaries as of the dates and for the periods therein specified in
conformity with generally accepted accounting principles consistently
applied throughout the periods involved, except as otherwise stated
therein; and the other financial and statistical information and data set
forth in the Registration Statement and the Prospectus is accurately
presented in all material respects and, to the extent such information and
data is derived from the financial statements and books and records of the
Predecessor Companies and their subsidiaries, is prepared on a basis
consistent with such financial statements and the books and records of the
Predecessor Companies and their subsidiaries; no other financial statements
are required under the Act to be included in the Registration Statement or
the Prospectus;
(ii) The pro forma financial data of the Company included in the
Prospectus are based upon good faith estimates and assumptions believed by
the Company and the Predecessor Companies to be reasonable and have been
prepared in accordance with the rules and regulations under the Act
(including Article 11 of Regulation S-X). No other pro forma financial
information is required by the Act or the rules or regulations thereunder
to be included in the Registration Statement or the Prospectus.
(q) There are no statutes or governmental regulations, or any
contracts or other documents that are required to be described in or filed
as exhibits to the Registration Statement which are not described therein
or filed as exhibits thereto;
(r) The Predecessor Companies and their subsidiaries own or possess,
and as a result of the Merger, the Company or its subsidiaries will
acquire, adequate patent rights or licenses or other rights to use patent
rights, inventions, trademarks, service marks, trade names and copyrights
necessary to conduct the general business now operated by them and neither
the Company, the Predecessor Companies nor any of their subsidiaries has
received any notice of infringement of or conflict with asserted rights of
others with
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<PAGE> 6
respect to any patent, patent rights, inventions, trademarks, service
marks, trade names or copyrights which, singly or in the aggregate, could
materially adversely affect the business, operations, financial condition,
income or business prospects of the Company, the Predecessor Companies and
their subsidiaries considered as a whole;
(s) Neither the Company, the Predecessor Companies nor any of their
subsidiaries is in violation of any term or provision of their respective
Certificate of Incorporation (or equivalent document) or By-Laws (or
equivalent document), in each case as amended to the date hereof; neither
the Company, the Predecessor Companies nor any of their subsidiaries is in
violation of any law, ordinance, administrative or governmental rule or
regulation applicable to the Company, the Predecessor Companies or any of
their subsidiaries, or of any decree of any court or governmental agency or
body having jurisdiction over the Company, the Predecessor Companies or any
of their subsidiaries (except for any violations which will not
individually or in the aggregate have a material adverse effect on the
business, operations, financial condition, or business prospects of the
Company, the Predecessor Companies and their subsidiaries considered as a
whole);
(t) No default exists, and no event has occurred which with notice or
lapse of time, or both, would constitute a default, in the due performance
and observance of any term, covenant or condition of any indenture,
mortgage, deed of trust, bank loan or credit agreement, lease or other
agreement or instrument to which the Company, the Predecessor Companies or
any of their subsidiaries is a party or by which any of them is bound
(except for any defaults which will not individually or in the aggregate
have a material adverse effect on the business, operations, financial
condition, or business prospects of the Company, the Predecessor Companies
and their subsidiaries considered as a whole);
(u) The Company, the Predecessor Companies and their subsidiaries have
timely filed all necessary tax returns and notices and have paid all
federal, state, county, local and foreign taxes of any nature whatsoever
for all tax years through December 31, 1993, to the extent such taxes have
become due (other than taxes which are being challenged in good faith by
the Company or a Predecessor Company, as the case may be, and are
adequately reserved for). The Company and the Predecessor Companies have no
knowledge, nor any reasonable grounds to know, of any tax deficiencies
which would have a material adverse effect on the Company, the Predecessor
Companies or any of their subsidiaries taken as a whole; the Company, the
Predecessor Companies and their subsidiaries have paid all taxes which have
become due, whether pursuant to any assessments, or otherwise, and there is
no further liability (whether or not disclosed on such returns) or
assessments for any such taxes, and no interest or penalties accrued or
accruing with respect thereto, except as may be set forth or adequately
reserved for in the financial statements included in the Registration
Statement; the amounts currently set up as provisions for taxes or
otherwise by the Company, the Predecessor Companies and their subsidiaries
on their books and records are sufficient in all material respects for the
payment of all their unpaid federal, foreign, state, county and local taxes
accrued through the dates as of which they speak, and for which the
Company, the Predecessor Companies and their subsidiaries may be liable in
their own right, or as a transferee of the assets of, or as successor to
any other corporation, association, partnership, joint venture or other
entity;
(v) The Company will not, during the period of 90 days after the date
hereof (except pursuant to this Agreement, the Merger Agreement or upon the
issuance of any Employee Option Shares or shares issued upon the conversion
of convertible securities or upon the exercise of warrants the Prospectus
indicates are outstanding, or options granted under the 1994 Stock
Incentive Plan (if adopted by the Board of Director of the Company and the
compensation committee) consistent with past practice to directors,
employees or consultants of any of the Predecessor Companies or the Company
hired or retained on or after May 1, 1994), offer, sell or otherwise
dispose of any capital stock of the Company, or any securities convertible
into shares of capital stock of the Company, directly or indirectly,
without the prior written consent of the Representative. Notwithstanding
the foregoing, the Company may issue shares of its capital stock in
connection with the consummation of any acquisitions of businesses engaged
in one or more of the same lines of business of the Company and the
Predecessor Companies, provided that the recipients of such shares of
capital stock shall have delivered to you an agreement, in the form
delivered to you pursuant to Section 7(l) hereof, not to offer, pledge,
sell, contract to sell or otherwise
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<PAGE> 7
dispose of any shares of Common Stock (or securities convertible into
shares of Common Stock), directly or indirectly, for the remainder of the
period set forth above;
(w) Each of the Company and the Predecessor Companies maintains a
system of internal accounting controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with
management's general or specific authorization; (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain
accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv)
the recorded accountability for assets is compared with existing assets at
appropriate intervals and appropriate action is taken with respect to any
differences;
(x) Neither the Company, the Predecessor Companies nor any of their
subsidiaries nor, to the Company's or the Predecessor Companies' knowledge,
any employee or agent of the Company, the Predecessor Companies or any of
their subsidiaries has made any payment of funds of the Company, the
Predecessor Companies or any subsidiary or received or retained any funds
in violation of any law, rule or regulation, which payment, receipt or
retention of funds is of a character required to be disclosed in the
Prospectus;
(y) The Company has not taken and will not take, directly or
indirectly, any action designed to or which has constituted or that might
be reasonably be expected to cause or result in stabilization or
manipulation of the price of any security of the Company to facilitate the
sale or resale of the Securities, in each case as defined under the
Exchange Act, and the rules and regulations of the Commission thereunder;
and
(z) All necessary new drug applications ("NDAs") and or amendments or
supplements thereto, as required by the Federal Food, Drug and Cosmetics
Act, the regulations of the Food and Drug Administration (the "FDA")
promulgated thereunder, and any policies issued by the FDA in connection
with such NDAs and amendments or supplements thereto, have been filed with
the FDA for all drugs sold by the Predecessor Companies, and all necessary
approvals and acknowledgements have been obtained from the FDA. Viratek
filed an NDA covering ribavivin for treatment of chronic hepatitis C with
the FDA on June 1, 1994. Neither the Company nor the Predecessor Companies
have received any notice that such NDA will not be approved by the FDA in a
timely manner.
2. Subject to the terms and conditions herein set forth, the Company
agrees to issue and sell to the several Underwriters an aggregate of $
principal amount of Firm Securities, and each of the Underwriters agrees to
purchase from the Company, at a purchase price of % of the principal amount
thereof, plus accrued interest, if any, from , 1994 to the Time of
Delivery, the respective principal amount of Firm Securities set forth opposite
the name of such Underwriter in Schedule I hereto.
In addition, subject to the terms and conditions herein set forth, the
Company agrees to issue and sell to the Underwriters, as required (for the sole
purpose of covering over-allotments in the sale of the Firm Securities), up to
$ aggregate principal amount of Option Securities at the same purchase
price as the Firm Securities are being sold by the Company as stated in the
preceding paragraph, plus accrued interest, if any, from , 1994 to
the Option Securities Delivery Date (as defined in paragraph 4 hereof). The
right to purchase the Option Securities may be exercised by your giving at least
48 hours' prior written notice to the Company of your determination to purchase
all or a portion of the Option Securities. Such notice may be given at any time
within a period of 30 days following the date of this Agreement. Option
Securities shall be purchased severally for the account of each Underwriter in
proportion to the principal amount of Firm Securities set forth opposite the
name of such Underwriter in Schedule I hereto. No Option Securities shall be
delivered to or for the accounts of the Underwriters unless the Firm Securities
shall be simultaneously delivered or shall theretofore have been delivered as
herein provided. The respective purchase obligations of each Underwriter shall
be adjusted by you so that no Underwriter shall be obligated to purchase Option
Securities other than in authorized denominations. The Underwriters may cancel
any purchase of Option Securities at any time prior to the Option Securities
Delivery Date by giving written notice of such cancellation to the Company.
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<PAGE> 8
3. Upon the authorization by you of the release of the Securities, the
Underwriters propose to offer the Securities for sale upon the terms and
conditions set forth in the Prospectus.
4. Certificates in temporary or definitive form for the Firm Securities to
be purchased by each Underwriter hereunder shall be delivered by or on behalf of
the Company to you for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price therefor by certified or
official bank check or checks, payable in New York Clearing House funds, to the
order of the Company, for the purchase price of the Firm Securities being sold
by the Company in New York, New York, at 9:30 A.M., New York City time, on
, 1994, or at such other time, date and place as you and the Company
may agree upon in writing, such time and date being herein called the "Time of
Delivery."
Certificates in temporary or definitive form for the Option Securities to
be purchased by each Underwriter hereunder shall be delivered by or on behalf of
the Company to you for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price thereof by certified or
official bank check or checks, payable in New York Clearing House funds, to the
order of the Company, for the purchase price of the Option Securities, in New
York, New York, at such time and on such date (not earlier than the Time of
Delivery nor later than ten business days after giving of the notice delivered
by you to the Company with reference thereto) as shall be specified in the
notice delivered by you to the Company with respect to the purchase of such
Option Securities. The date and time of such delivery and payment are herein
sometimes referred to as the "Option Securities Delivery Date." The obligations
of the Underwriters shall be subject, in their discretion, to the condition that
there shall be delivered to the Underwriters on the Option Securities Delivery
Date opinions and certificates, dated such Option Securities Delivery Date,
referring to the Option Securities, instead of the Firm Securities, but
otherwise to the same effect as those required to be delivered at the Time of
Delivery pursuant to Sections 7(d), 7(e), 7(f), 7(g), 7(h) and 7(k).
Certificates for the Firm Securities and the Option Securities so to be
delivered will be in good delivery form, and in such denominations and
registered in such names as you may request not less than 48 hours prior to the
Time of Delivery and the Option Securities Delivery Date, respectively. Such
certificates will be made available for checking and packaging in New York, New
York, at least 24 hours prior to the Time of Delivery and Option Securities
Delivery Date.
5. The Company and, with respect to clause (j) below, each of the
Predecessor Companies, agrees with each of the Underwriters:
(a) If the Registration Statement has not become effective, to
promptly file the Final Amendment with the Commission and use its best
efforts to cause the Registration Statement to become effective; if the
Registration Statement has become effective, to promptly file the Rule 430A
Prospectus with the Commission; to make no further amendment or any
supplement to the Registration Statement or Prospectus which shall be
disapproved by you in good faith after reasonable notice thereof; to advise
you, promptly after it receives notice thereof of the time when the
Registration Statement, or any amendment thereto, or any amended
Registration Statement has become effective or any supplement to the
Prospectus or any amended Prospectus has been filed, of the issuance by the
Commission of any stop order or of any order preventing or suspending the
use of any Preliminary Prospectus or the Prospectus, of the suspension of
the qualification of the Securities for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for any
such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or Prospectus or for additional
information; and in the event of the issuance of any stop order or of any
order preventing or suspending the use of any Preliminary Prospectus or the
Prospectus or suspending any such qualification, to use promptly its best
efforts to obtain withdrawal of such order;
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Securities for offering and sale under
the securities laws of such jurisdictions as you may request and to comply
with such laws so as to permit the continuance of sales and dealings
therein in such jurisdictions for as long as may be necessary to complete
the distribution, provided that in connection therewith the Company shall
not be required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
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<PAGE> 9
(c) To furnish the Underwriters with copies of the Registration
Statement (two of which will be signed and will include all exhibits), each
Preliminary Prospectus, the Prospectus and all amendments or supplements
thereto in such quantities and in such form or forms as you may from time
to time reasonably request, and if the delivery of a prospectus is required
by law in connection with sales of Securities at any time prior to the
expiration of nine months after the time of issue of the Prospectus and if
at such time any event shall have occurred as a result of which the
Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact necessary
in order to make statements therein, in the light of the circumstances
under which they were made when such Prospectus is delivered, not
misleading, or if for any other reason it shall be necessary to amend or
supplement the Prospectus in order to comply with the Act, to notify you
and upon your request to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many copies as you may from
time to time reasonably request of an amended Prospectus or a supplement to
the Prospectus or make an appropriate filing under Section 13, 14 or 15(d)
of the Exchange Act which will correct such statement or omission or effect
such compliance; and in case any Underwriter is required to deliver a
prospectus in connection with sales of any of the Securities at any time
nine months or more after the time of issue of the Prospectus, upon your
request but at the expense of such Underwriter, to prepare and deliver to
such Underwriter as many copies as you may request of an amended or
supplemented Prospectus complying with Section 10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than 45 days after the close of the
period covered thereby (or 95 days if such period coincides with the
Company's fiscal year), an earning statement in form complying with the
provisions of Section 11(a) of the Act covering a period of 12 consecutive
months beginning not later than the first day of the Company's fiscal
quarter next following the Effective Date;
(e) To file promptly all documents required to be filed with the
Commission pursuant to Section 13, 14 or 15(d) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act") subsequent to the Effective
Date and during any period when the Prospectus is required to be delivered;
(f) For a period of five years from the Effective Date, to furnish to
its securityholders after the end of each fiscal year an annual report
(including a consolidated balance sheet and statements of income, cash flow
and stockholders' equity of the Company and its subsidiaries certified by
independent public accountants) and, as soon as practicable after the end
of each of the first three quarters of each fiscal year (beginning with the
fiscal quarter ending after the Effective Date), consolidated summary
financial information of the Company and its subsidiaries for such quarter
in reasonable detail;
(g) During a period of five years from the Effective Date, to furnish
to you copies of all reports or other communications (financial or other)
furnished to its securityholders, and deliver to you (i) as soon as they
are available, copies of any reports and financial statements furnished to
or filed with the Commission or any national securities exchange on which
any class of securities of the Company is listed; and (ii) such additional
information concerning the business and financial condition of the Company
as you may from time to time reasonably request in connection with your
obligations hereunder;
(h) That it will not take, directly or indirectly, any action designed
to or that might reasonably be expected to cause or result in stabilization
or manipulation of the price of the Common Stock or the Securities to
facilitate the sale or resale of the Securities;
(i) To use its best efforts to maintain the listings of the Securities
and the Common Stock on the New York Stock Exchange;
(j) To take all actions which may be necessary to consummate the
Merger at or prior to the Time of Delivery, including the filing of a
certificate of merger with the Secretary of State of the State of Delaware
effecting the Merger;
(k) To apply the net proceeds from the sale of the Securities in
accordance with the terms of the Deposit Agreement and as set forth under
the caption "Use of Proceeds" in the Prospectus; and
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<PAGE> 10
(l) To take all actions promptly after the Time of Delivery which may
be necessary to change the name of the Company to "ICN Pharmaceuticals,
Inc."
6. The Company and the Predecessor Companies covenant and agree, jointly
and severally, with the several Underwriters that the Company will pay or cause
to be paid: (i) the fees, disbursements and expenses of counsel and accountants
for the Company and the Predecessor Companies, and all other expenses, in
connection with the preparation, printing and filing of the Registration
Statement (including the Form T-1) and the Prospectus and (except as otherwise
provided in Section 5(c) hereof) amendments and supplements thereto and the
furnishing of copies thereof, including charges for mailing, air freight and
delivery and counting and packaging thereof, and of any Preliminary Prospectus
and related offering documents to the Underwriters and dealers; (ii) the cost of
printing this Agreement, the Agreement Among Underwriters, the Selling
Agreement, the Indenture, communications with the Underwriters and selling group
and the Preliminary and Supplemental Blue Sky Memoranda; (iii) all expenses in
connection with the qualification of the Securities for offering and sale under
state securities laws as provided in Section 5(b) hereof, including filing and
registration fees and the fees, disbursements and expenses for counsel for the
Underwriters in connection with such qualification and in connection with Blue
Sky surveys; (iv) the filing fees incident to securing any required review by
the National Association of Securities Dealers, Inc. of the terms of the sale of
the Securities; (v) the fees and expenses incurred in connection with the
listing of the Securities and the Conversion Shares on the New York Stock
Exchange; and (vi) all other costs and expenses incident to the performance of
their obligations hereunder which are not otherwise specifically provided for in
this Section 6, including the fees of the Company's Transfer Agent and
Registrar, the fees of the Trustee, the cost of any stock transfer taxes on sale
of the Securities to the Underwriters, the cost of the Company's and the
Predecessor Companies' personnel and other internal costs, the cost of printing
and engraving the certificates representing the Securities and all expenses and
taxes incident to the sale and delivery of the Securities to be sold by the
Company to the Underwriters hereunder.
It is understood, however, that, except as provided in this Section,
Section 8 and Section 11 hereof, the Underwriters will pay all their own costs
and expenses, including the fees of their counsel, stock transfer taxes on
resale of any of the Securities by them, and any advertising expenses connected
with any offers they may make.
7. The obligations of the Underwriters hereunder shall be subject, in
their discretion, to the condition that all representations and warranties and
other statements of the Company and the Predecessor Companies herein are, at and
as of the Time of Delivery, true and correct, the condition that the Company and
the Predecessor Companies shall have performed all their obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Registration Statement shall have become effective, and you
shall have received notice thereof not later than 5:00 P.M., New York City
time, on the date of execution of this Agreement, or at such other time as
you and the Company may agree; if required, the Prospectus shall have been
filed in accordance with Rule 424(b)(1) or (4) of the rules and regulations
of the Commission under the Act not later than 24 hours following the
execution of this Agreement; no stop order suspending the effectiveness of
the Registration Statement shall have been issued and no proceeding for
that purpose shall have been initiated or threatened by the Commission; and
all requests for additional information on the part of the Commission shall
have been complied with to your reasonable satisfaction;
(b) All corporate proceedings and related legal and other matters in
connection with the Merger, the organization of the Company and the
registration, authorization, issue, sale and delivery of the Securities
shall have been reasonably satisfactory to Fulbright & Jaworski L.L.P.,
counsel to the Underwriters, and Fulbright & Jaworski L.L.P. shall have
been furnished with such papers and information as they may reasonably have
requested to enable them to pass upon the matters referred to in this
subsection;
(c) You shall not have advised the Company that the Registration
Statement or Prospectus or the Company's Registration Statement on Form S-4
(file no. 33-84534), or any amendment or supplement thereto, contains an
untrue statement of fact or omits to state a fact which in your judgment is
in either
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<PAGE> 11
case material and in the case of an omission is required to be stated
therein or is necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(d) Fried, Frank, Harris, Shriver & Jacobson, counsel to the Company
and the Predecessor Companies [or, with respect to opinions agreed to by
the Underwriters, David Watt, counsel to the Company], shall have furnished
to you their written opinion, dated the Time of Delivery, in form and
substance satisfactory to you, to the effect that [TO BE REVISED]:
(i) The Company/1 has been duly and validly incorporated and is
validly existing as a corporation in good standing under the laws of the
State of Delaware, and is qualified to do business and is in good
standing in each jurisdiction in which its ownership or leasing of
properties requires such qualification or the conduct of its business
requires such qualification (except where the failure to so qualify
would not have a material adverse effect on the Company and its
subsidiaries as a whole); and the Company has all necessary corporate
power and all material governmental authorizations, permits and
approvals required to own its properties and conduct its business as
described in the Prospectus;
(ii) Each of the Company's subsidiaries has been duly and validly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, and is
qualified to do business and is in good standing in each jurisdiction in
which its ownership or leasing of properties requires such qualification
or the conduct of its business requires such qualification (except where
the failure to so qualify would not have a material adverse effect on
the Company and its subsidiaries as a whole); and each such subsidiary
has all necessary corporate power and all material governmental
authorizations, permits and approvals required to own its properties and
to conduct its business as described in the Prospectus;
(iii) All of the outstanding shares of capital stock of each of the
Company's subsidiaries are duly and validly authorized and issued, are
fully paid and non-assessable and, except as otherwise described in the
Prospectus, are owned by the Company and, to the best knowledge of
counsel, (A) beneficially and (B) free and clear of all liens, charges
or encumbrances of any nature whatsoever and, to the knowledge of such
counsel, there are no outstanding options, warrants or other rights
calling for the issuance of, and there are no circumstances, plans or
arrangements to issue any shares of capital stock of any subsidiary or
any security convertible or exchangeable or exercisable for capital
stock of any subsidiary, except as otherwise described in the
Prospectus;
(iv) The Company has an authorized capitalization as set forth in
the Registration Statement and all of the outstanding shares of capital
stock of the Company have been duly and validly authorized and issued,
and are fully paid and non-assessable, are free of any preemptive or
similar rights, and were issued and sold in compliance with all
applicable Federal and state securities laws and conform in all material
respects to the descriptions thereof in the Prospectus; except as
described in the Prospectus, to the knowledge of such counsel, there are
no outstanding options, warrants or other rights calling for the
issuance of, and there are not commitments, plans or arrangements to
issue, any shares of capital stock of the Company or any security
convertible or exchangeable or exercisable for capital stock of the
Company; the Common Stock has been registered under the Exchange Act and
is listed on the New York Stock Exchange, and the shares of Common Stock
initially issuable upon conversion of the Securities have been duly and
validly authorized and reserved for issuance, and such shares, when
issued and delivered in accordance with the provisions of the Securities
and the Indenture, will be duly and validly issued, fully paid and non-
assessable, and, if issued on the date hereof, would conform to the
description of the Common Stock contained in the Prospectus;
- ---------------
1/All references to the "Company" in clauses (d)(i), (ii), (iii), (iv), (vii),
(viii), (ix), (x), (xi) and (xiii) of Section 7 mean ICN Merger Corp. and each
of the Predecessor Companies, individually.
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<PAGE> 12
(v) The shares of Common Stock to be issued by the Company pursuant
to the terms of the Merger Agreement have been duly and validly
authorized and, when issued and delivered as provided in the Merger
Agreement, will be duly and validly issued, fully paid and
non-assessable, and will conform to the description of the Common Stock
contained in the Prospectus;
(vi) The Securities to be issued and sold by the Company to the
Underwriters hereunder have been duly and validly authorized and, when
issued and delivered against payment therefor as provided in this
Agreement, will constitute valid and legally binding obligations of the
Company, enforceable against the Company in accordance with their terms,
subject to bankruptcy, insolvency, moratorium, reorganization and other
similar laws relating to or affecting creditors' rights generally and by
general equitable principles; the Securities are entitled to the
benefits of the Indenture; the Indenture has been duly authorized and,
when duly executed and delivered by the Company and the Trustee, will
constitute a legal, valid and binding obligation of the Company,
enforceable in accordance with its terms, subject to bankruptcy,
insolvency, moratorium, reorganization and other similar laws relating
to or affecting creditors' rights generally and by general equitable
principles; the Indenture has been duly qualified under the Trust
Indenture Act of 1939; the Securities and the Indenture conform in all
material respects to the descriptions thereof in the Prospectus; and the
Securities have been approved for listing on the New York Stock
Exchange;
(vii) The issue and sale of the Securities and the compliance by
the Company with all of the provisions of the Securities and the
Indenture, the entering into and performance of this Agreement, the
Deposit Agreement and the Merger Agreement, and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which the Company
or any of its subsidiaries is a party or by which the Company or any of
its subsidiaries is bound or to which any of the property or assets of
the Company or any of its subsidiaries is subject, or result in the
creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any of its subsidiaries, nor will
such action result in any violation of the provisions of the Certificate
of Incorporation (or equivalent document) or the By-laws (or equivalent
document), in each case as amended, of the Company or any of its
subsidiaries, or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the
Company or any of its subsidiaries or any of their properties; and no
consent, approval, authorization, order, registration or qualification
of or with any court or governmental agency or body is required for the
issue and sale of the Securities or the consummation of the other
transactions contemplated by this Agreement, the Deposit Agreement and
the Merger Agreement, except such as have been obtained under the Act
and the Trust Indenture Act of 1939, and such consents, approvals,
authorizations, registrations or qualifications as may be required under
state securities or Blue Sky laws in connection with the purchase and
distribution of the Securities by the Underwriters;
(viii) Such counsel does not know of any legal or governmental
proceedings pending or threatened against the Company or any subsidiary
which would affect the subject matter of this Agreement, the Deposit
Agreement or the Merger Agreement, or is required to be disclosed in the
Prospectus which is not disclosed and correctly summarized therein;
(ix) The Company has all requisite power and authority to execute,
deliver and perform its obligations under this Agreement, the Deposit
Agreement and the Merger Agreement; the execution, delivery and
performance by the Company of its obligations under this Agreement, the
Deposit Agreement and the Merger Agreement have been duly and validly
authorized by all requisite corporate action of the Company; and this
Agreement, the Deposit Agreement and the Merger Agreement constitute the
legal, valid and binding obligations of the Company, enforceable against
the Company in accordance with its terms, subject to bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally and except as enforceability of those
provisions relating to indemnity may be limited by the Federal
securities laws and principles of public policy;
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<PAGE> 13
(x) To the best of such counsel's knowledge, neither the Company
nor any of its subsidiaries is (1) in violation of any term or provision
of its Certificate of Incorporation (or equivalent document) or By-laws
(or equivalent document), in each case as amended to the date hereof, or
any law, ordinance, administrative or governmental rule or regulation
applicable to the Company or any of its subsidiaries, or of any decree
of any court or governmental agency or body having jurisdiction over the
Company or any of its subsidiaries; or (2) in breach of or in default
under, any indenture, mortgage, deed of trust, lease, bank loan or
credit agreement or any other agreement or instrument of which such
counsel has knowledge to which the Company or any of its subsidiaries is
a party or by which any of them or any of their property may be bound or
affected;
(xi) There are no preemptive or other rights to subscribe for or to
purchase, nor any restriction upon the voting or transfer of, any
securities of the Company pursuant to the Company's Certificate of
Incorporation or By-Laws, in each case as amended, or any agreement or
other instrument known to such counsel; and no holders of securities of
the Company have rights to the registration thereof under the
Registration Statement or, if any such holders have such rights, such
holders have waived such rights;
(xii) Such counsel has read all contracts referred to in the
Registration Statement and the Prospectus and all other loan agreements
and, to the extent material, such contracts are fairly summarized as
disclosed therein, conform in all material respects to the descriptions
thereof contained therein, and are filed as exhibits thereto, and such
counsel does not know of any contracts or other documents required to be
so summarized or disclosed, or so filed, which have not been so
summarized or disclosed, or so filed, and there are no statutes or
regulations or pending or threatened legal or governmental proceedings
required to be disclosed in the Prospectus which have not been described
as required;
(xiii) Such counsel does not know that any of the representations
and warranties of the Company contained in this Agreement, the Deposit
Agreement or the Merger Agreement are not true or correct or that any of
the covenants and agreements herein or therein contained to be performed
on the part of the Company or any of the conditions herein contained, or
set forth in the Registration Statement and the Prospectus, to be
fulfilled or complied with by the Company have not been or will not be
duly and timely performed, fulfilled or complied with;
(xiv) The Registration Statement has become effective under the
Act, the Prospectus has been filed in accordance with Rule 424(b) of the
rules and regulations of the Commission under the Act, including the
applicable time periods set forth therein, or such filing is not
required, and no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or are pending or, to the knowledge of such
counsel, contemplated under the Act, and the Registration Statement, the
Prospectus and each amendment or supplement thereto, as of their
respective effective or issue dates, complied as to form in all material
respects with the requirements of the Act and the rules and regulations
thereunder; it being understood that such counsel need express no
opinion as to the financial statements or other financial data contained
or incorporated by reference in the Registration Statement or the
Prospectus; and
(xv) A certificate of merger has been filed with the Secretary of
State of the State of Delaware giving effect to the Merger; and
(xvi) The statements under the heading "Certain Federal Income Tax
Consequences" in the Prospectus, to the extent that they constitute
matters of law or legal conclusions, have been prepared or reviewed by
such counsel and are correct in all material respects.
Such counsel shall also state that nothing has come to such counsel's
attention that would lead such counsel to believe that either the
Registration Statement, as of the date it became effective, or the
Prospectus, as of its date and the Time of Delivery, contains any untrue
statement of material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
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<PAGE> 14
(e) David Watt, Vice President, General Counsel and Secretary of the
Company, shall have furnished to you his written opinion, dated the Time of
Delivery, in form and substance satisfactory to you, to the effect that:
[TO FOLLOW]
(f) Lyon and Lyon, patent counsel for the Company, SPI and Viratek,
shall have furnished to you their written opinion, dated the Time of
Delivery, in form and substance satisfactory to you, to the effect that:
(i) the Company is listed in the records of the United States
Patent and Trademark Office as the holder of record of each of the
patents relied on by the Company in connection with the use, marketing
and sale of Virazole (the "Patents") and each of the patent applications
submitted by the Company relating to an indication or use of Virazole
(the "Applications"). Such counsel knows of no claims of third parties
to any ownership interest or lien with respect to any of the Patents or
Applications. To such counsel's knowledge, none of the Applications has
been rejected;
(ii) To such counsel's knowledge, the Company is listed in the
records of the appropriate foreign office as the sole holder of record
of each of the foreign patents and applications relating to Virazole.
Such counsel knows of no claims of third parties to any of such foreign
applications. To such counsel's knowledge, none of the foreign
applications has been rejected;
(iii) The statements under the Prospectus captions "Investment
Considerations -- Limited Patent Protection"; and "Business -- Licenses,
Patents and Trademarks" (collectively, the "Intellectual Property
Portion"), insofar as such statements constitute summaries of the
Patents and Applications, as the case may be, are in all material
respects accurate summaries and fairly summarize in all material
respects the legal matters, documents and proceedings relating to such
Patents and Applications described therein;
(iv) Such counsel is not aware of any facts that would lead such
counsel to conclude that any of the Patents are invalid or that any
patent issued in respect of an Application would be invalid;
(v) Such counsel is not aware that any valid patent is infringed by
the activities of the Company described in the Prospectus or by the
manufacture, use or sale of any product, device, instrument, drug or
other material made and used according to the Applications or the
Patents;
(vi) Such counsel is not aware of any material defects of form in
the preparation or filing of the Applications on behalf of the Company.
The Applications are being diligently pursued by the Company;
(vii) Such counsel knows of no pending or threatened action, suit,
proceeding or claim by others that the Company is infringing or
otherwise violating any patents, copyrights or trade secrets;
(viii) Such counsel is not aware of any pending or threatened
actions, suits, proceedings or claim by others challenging the validity
or scope of the Applications or the Patents;
(ix) Such counsel is not aware of any infringement on the part of
any third party of the Patents, Applications, trade secrets, know-how or
other proprietary rights of the Company; and
(x) Nothing has come to the attention of such counsel which causes
such counsel to believe that the information contained in the
Intellectual Property Portion of the Registration Statement, at the time
it became effective, or any amendment thereof contained or contains an
untrue statement of a material fact or omitted or omits to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading or that the information contained in
the Intellectual Property Portion of the Prospectus, as of its date or
the Time of Delivery, or any supplement thereto contained or contains
any untrue statement of a material fact or omitted or omits to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
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<PAGE> 15
(g) Kleinfeld, Kaplan and Becker, special regulatory counsel for the
Company, shall have furnished to you their written opinion, dated the Time
of Delivery, in form and substance satisfactory to you, to the effect that:
(i) The statements under the captions "Investment
Considerations" -- Government Regulation," and Business -- Government
Regulation" (collectively, the "Regulatory Portion") to the extent that
they reflect matters of law, summaries of law or regulations, regulatory
status are correct in all material respects, subject to the
qualification set forth therein.
(ii) Nothing has come to the attention of such counsel that would
lead such counsel to believe that the Regulatory Portion of the
Registration Statement, at the time it became effective, or any
amendment thereof, contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading or that the
information contained in the Regulatory Portion of the Prospectus, as of
its date or the Time of Delivery or any supplement thereto contained any
untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
In rendering their respective opinions set forth in Sections 7(d), 7(e) and
7(f) above, counsel may rely, to the extent deemed advisable by such
counsel, (a) upon certificates of state officials, and (b) on opinions of
counsel as to matters of law of jurisdictions other than California,
Delaware and the federal laws of the United States (provided, however, that
you shall have received a copy of each of such opinions which shall be
dated the Time of Delivery, addressed to you or otherwise authorizing you
to rely thereon);
(h) Fulbright & Jaworski L.L.P., counsel to the Underwriters, shall
have furnished to you their written opinion or opinions, dated the Time of
Delivery, in form and substance satisfactory to you, with respect to the
incorporation of the Company, the validity of the Securities, the
Registration Statement, the Prospectus and other related matters as you may
reasonably request, and such counsel shall have received such papers and
information as they may reasonably request to enable them to pass upon such
matters;
(i) At the time this Agreement is executed and also at the Time of
Delivery, Coopers & Lybrand L.L.P. shall have furnished to you a letter or
letters, dated the date of this Agreement and the Time of Delivery, in form
and substance satisfactory to you, to the effect, that:
(i) They are independent accountants with respect to the Company
and its subsidiaries within the meaning of the Act and the applicable
published rules and regulations thereunder;
(ii) In their opinion the consolidated financial statements of the
Company and its subsidiaries (including the related schedules and notes)
audited by them and included in the Registration Statement and
Prospectus comply as to form in all material respects with the
applicable accounting requirements of the Act and the Exchange Act and
the related published rules and regulations;
(iii) On the basis of specified procedures as of a specified date
not more than five days prior to the date of their letter (which
procedures do not constitute an examination made in accordance with
generally accepted auditing standards), consisting of a reading of the
latest available unaudited interim consolidated financial statements of
the Company and its subsidiaries subsequent to December 31, 1993 (with
an indication of the date or dates of each such latest available
financial statements), a reading of the latest available minutes of
meeting of the Board of Directors and stockholders of the Company and
its subsidiaries since December 31, 1993, inquiries of officials of the
Company who have responsibility for financial and accounting matters
subsequent to December 31, 1993, respectively, and such other procedures
or inquiries as are specified in such letter, nothing came to their
attention that caused them to believe that:
(A) the information relating to the Company and its subsidiaries
for the five fiscal years ended December 31, 1993, included in the
Prospectus under the caption "Summary Financial
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<PAGE> 16
Data" and "Selected Financial Data" does not agree with corresponding
amounts in the audited consolidated balance sheets and consolidated
statements of income and changes in cash flows as at and for the
years then ended;
(B) as of a specified date not more than five days prior to the
date of their letter, there was any change in the capital stock,
long-term debt or short-term debt of the Company and its subsidiaries
on a consolidated basis, or any decreases in stockholders' equity,
property, plant and equipment, working capital or total assets of the
Company, as compared with the amounts shown in the consolidated
balance sheet as of June 30, 1994, included in the Prospectus, except
in each case for changes which the Prospectus discloses have occurred
or may occur or which are described in their letter; and
(C) for the period from June 30, 1994, to a specified date not
more than five days prior to the date of such letter, there was any
decrease, as compared with the corresponding period of the preceding
fiscal year, in the following consolidated amounts: net sales, income
before provision for income taxes and minority interest, net income
or net income per share of the Company and its subsidiaries, except
in all instances for decreases which the Registration Statement
discloses have occurred or may occur; or if there was any decrease,
setting forth the amount of such decrease; or if the Company and its
subsidiaries have no consolidated financial statements subsequent to
June 30, 1994, and other sufficient information is not available to
management in order to enable management to comment on net sales,
income before provision for income taxes and minority interest, net
income or net income per share of the Company and its subsidiaries
subsequent to June 30, 1994, stating that management believes that
there was no decrease in net sales, income before provision for
income taxes and minority interest, net income or net income per
share of the Company and its subsidiaries for the period to
, 1994, as compared with the corresponding period of the
preceding fiscal year;
(iv) in addition to the examination referred to in their reports
included in the Registration Statement and the Prospectus and the
limited procedures referred to in clause (iii) above, they have carried
out certain specified procedures, not constituting an audit, with
respect to certain amounts, percentages and financial information which
are derived from the general accounting records of the Company and its
subsidiaries which appear in (a) the Prospectus, (b) each of the
Predecessor Company's Annual Report on Form 10-K for the year ended
December 31, 1993, and (c) each of the Predecessor Company's Quarterly
Reports on Form 10-Q for the quarters ended March 31, 1994 and June 30,
1994, each of which is specified by you, and have compared such amounts
and financial information with the accounting records of the Company and
its subsidiaries, and have found them to be in agreement and have proved
the mathematical accuracy of certain specified percentages; and
(v) On the basis of procedures (but not an examination made in
accordance with generally accepted auditing standards) consisting of a
reading of the unaudited pro forma consolidated balance sheets and the
unaudited pro forma consolidated statements of income of New ICN
included in the Registration Statement and inquiries of certain
officials of the Company who have responsibility for financial and
accounting matters and other specified procedures and inquiries and
verification of the arithmetic accuracy of the application of the pro
forma adjustments to the historical amounts in such pro forma
consolidated financial statements, nothing came to their attention that
caused them to believe that the unaudited pro forma financial statements
included in the Registration Statement do not comply as to form in all
material respects with the applicable accounting requirements of Rule
11-02 of Regulation S-X and that the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of these
statements.
(j) (A) Neither the Company nor any of its subsidiaries shall have
sustained since December 31, 1993, any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental
action, order or decree; and (B) since the respective dates as of which
information is given in the Prospectus, and except as otherwise set forth
in the Prospectus, there shall not have been any change in the capital
stock (other than shares
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<PAGE> 17
issued pursuant to the exercise of Employee Option Shares or shares issued
upon the conversion of convertible securities or upon the exercise of
warrants the Prospectus indicates are outstanding) or short-term debt
(other than an immaterial change in short-term debt in the ordinary course
of business) or long-term debt of the Company or any of its subsidiaries
nor any change or any development involving a prospective change, in or
affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any such case described in clause (A)
or (B), is in your judgment so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Securities on the terms and in the manner contemplated in
the Prospectus;
(k) Between the date hereof and the Time of Delivery there shall have
been no declaration of war by the United States; at the Time of Delivery
there shall not have occurred any material adverse change in the financial
or securities markets in the United States or in political, financial or
economic conditions in the United States or any outbreak or material
escalation of hostilities or other calamity or crisis, or any material
adverse change in political, financial or economic conditions in Yugoslavia
or any outbreak or material escalation of hostilities or other calamity or
crisis in Yugoslavia which has a material adverse effect on the Company,
the effect of which is to make it, in your judgment, impracticable to
market the Securities or to enforce contracts for the resale of Securities
and no event shall have occurred resulting in (i) trading in securities
generally on either the New York Stock Exchange or American Stock Exchange
being suspended or limited or minimum or maximum prices being generally
established on such exchange, or (ii) additional material governmental
restrictions, not in force on the date of this Agreement, being imposed
upon trading in securities generally by such exchange or by order of the
Commission or any court or other governmental authority or (iii) a general
banking moratorium being declared by either Federal or New York
authorities;
(l) The Company shall have furnished or caused to be furnished to you
at the Time of Delivery a certificate signed by the chief executive officer
and the chief financial officer of the Company and each of the Predecessor
Companies satisfactory to you as to such matters as you may reasonably
request and as to (i) the accuracy of the Company's and the Predecessor
Companies' representations and warranties herein at and as of the Time of
Delivery, (ii) the performance by the Company and each of the Predecessor
Companies of all their obligations hereunder to be performed at or prior to
the Time of Delivery, (iii) the fact that they have carefully examined the
Registration Statement and Prospectus and, (a) as of the Effective Date,
the statements contained in the Registration Statement and the Prospectus
were true and correct and neither the Registration Statement nor the
Prospectus omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading and (b) since
the Effective Date, no event has occurred that is required by the Act or
the rules and regulations of the Commission thereunder to be set forth in
an amendment of, or a supplement to, the Prospectus that has not been set
forth in such an amendment or supplement, and (iv) the matters set forth in
subsection (a) of this Section 7;
(m) Each director and executive officer of the Company shall have
delivered to you an agreement not to offer, pledge, sell, contract to sell
or otherwise dispose of any shares of Common Stock (or securities
convertible into shares of Common Stock), directly or indirectly, for a
period of 90 days after the date of this Agreement, without the prior
written consent of the Representative;
(n) The Company shall have delivered to you evidence that the
Securities have been authorized for listing on the New York Stock Exchange,
subject to official notice of issuance;
(o) The Company and the Escrow Agent shall have duly executed and
delivered the Deposit Agreement; and
(p) Each of the conditions set forth in Section 6 of the Merger
Agreement shall have been satisfied or waived and the Company shall have
filed a certificate(s) of merger with the Secretary of State of the State
of Delaware effecting the Merger.
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<PAGE> 18
8. (a) The Company/2 will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon (i) any untrue statement or alleged untrue statement made
by the Company in Section 1 of this Agreement, (ii) any untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or any amendment or
supplement thereto, or in any Blue Sky application or other document executed by
the Company specifically for that purpose or based upon written information
furnished by the Company filed in any state or other jurisdiction in order to
qualify any or all of the Securities under the securities laws thereof or filed
with the Commission or any securities association or securities exchange (each,
an "Application"), or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
made or incorporated by reference therein not misleading, or (iii) the
employment by the Company of any device, scheme or artifice to defraud, or the
engaging by the Company in any act, practice or course of business which
operates or would operate as a fraud or deceit, or any conspiracy with respect
thereto, in which the Company shall participate, in connection with the issuance
and sale of any of the Securities, and will reimburse each Underwriter for any
legal or other expenses reasonably incurred by such Underwriter in connection
with investigating, preparing to defend, defending or appearing as a third-party
witness in connection with any such action or claim; provided, however, that the
Company shall not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission relating to an
Underwriter made in any Preliminary Prospectus, the Registration Statement, the
Prospectus or such amendment or supplement or any Application in reliance upon
and in conformity with written information furnished to the Company by such
Underwriter through you expressly for use therein; and provided, further, that
the indemnity agreement contained in this Section 8(a) with respect to any
Preliminary Prospectus shall not inure to the benefit of any Underwriter (or any
persons controlling such Underwriter) on account of any losses, claims, damages,
liabilities or litigation arising from the sale of Securities to any person, if
such Underwriter fails to send or give a copy of the Prospectus, as the same may
be then supplemented or amended, to such person, within the time required by the
Act and the untrue statement or alleged untrue statement or omission or alleged
omission of a material fact contained in such Preliminary Prospectus was
corrected in the Prospectus, unless such failure is the result of noncompliance
by the Company with Section 5(c) hereof.
(b) In addition to any obligations of the Company under Section 8(a), the
Company agrees that it shall perform its indemnification obligations under
Section 8(a) (as modified by the last paragraph of this Section 8(b)) with
respect to counsel fees and expenses and other expenses reasonably incurred by
making payments within 30 days to the Underwriter in the amount of the
statements of the Underwriter's counsel or other statements which shall be
forwarded by the Underwriter, and that they shall make such payments
notwithstanding the absence of a judicial determination as to the propriety and
enforceability of the obligation to reimburse the Underwriters for such expenses
and the possibility that such payments might later be held to have been improper
by a court and a court orders return of such payments.
The indemnity agreement in Section 8(a) shall be in addition to any
liability which the Company may otherwise have and shall extend upon the same
terms and conditions to each person, if any, who controls any Underwriter within
the meaning of the Act or the Exchange Act.
(c) Each Underwriter will indemnify and hold harmless the Company against
any losses, claims, damages or liabilities to which the Company may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or any
amendment or supplement thereto, or any Application, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only
- ---------------
2All references to the "Company" in Section 8 mean ICN Merger Corp. and the
Predecessor Companies, collectively.
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<PAGE> 19
to the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in any Preliminary Prospectus, the
Registration Statement, the Prospectus or such amendment or supplement or any
Application in reliance upon and in conformity with written information
furnished to the Company by such Underwriter relating to such Underwriter
through you expressly for use therein, and will reimburse the Company for any
legal or other expenses reasonably incurred by the Company in connection with
investigating or defending any such action or claim.
The indemnity agreement in this Section 8(c) shall be in addition to any
liability which the respective Underwriters may otherwise have and shall extend,
upon the same terms and conditions, to each officer and director of the Company
and to each person, if any, who controls the Company within the meaning of the
Act or the Exchange Act.
(d) Promptly after receipt by an indemnified party under Section 8(a) or
8(c) of notice of the commencement of any action (including any governmental
investigation), such indemnified party shall, if a claim in respect thereof is
to be made against the indemnifying party under such subsection, notify the
indemnifying party in writing of the commencement thereof; but the omission so
to notify the indemnifying party shall not relieve it from any liability which
it may have to any indemnified party under Section 8(a) or 8(c) except to the
extent the indemnifying party was unaware of such action and has been prejudiced
in any material respect by such failure or from any liability which the
indemnifying party may have to any indemnified party otherwise than under such
Section 8(a) or 8(c). In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the commencement
thereof, the indemnifying party shall be entitled to participate therein and, to
the extent that it shall wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party, and after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be liable to such indemnified party
under such subsection for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof other than
reasonable costs of investigation. If, however, (i) the indemnifying party has
authorized the employment of counsel for the indemnified party at the expense of
the indemnifying party or (ii) an indemnified party shall have reasonably
concluded that representation of such indemnified party and the indemnifying
party by the same counsel would be inappropriate under applicable standards of
professional conduct due to actual or potential differing interests between them
and the indemnified party so notifies the indemnifying party, then the
indemnified party shall be entitled to employ counsel different from counsel for
the indemnifying party at the expense of the indemnifying party and the
indemnifying party shall not have the right to assume the defense of such
indemnified party. In no event shall the indemnifying parties be liable for fees
and expenses of more than one counsel (in addition to local counsel) for all
indemnified parties in connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the same set of
allegations or circumstances. The counsel with respect to which fees and
expenses shall be so reimbursed shall be designated in writing by Wertheim
Schroder & Co. Incorporated in the case of parties indemnified pursuant to
Section 8(a) and by the Company in the case of parties indemnified pursuant to
Section 8(c). The respective indemnity and contribution agreements by the
Underwriters and the Company contained in Section 8(a), 8(b) and 8(c) and this
Section 8 shall be in addition to any liability which the Underwriters and the
Company may otherwise have. An indemnifying party shall not be liable for any
settlement of any claim effected without its written consent (which consent will
not be unreasonably withheld).
If at any time an indemnified party shall have requested an indemnifying
party to reimburse the indemnified party for fees and expenses of counsel as
contemplated by Section 8(b), the indemnifying party agrees that it shall be
liable for any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than 30 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying party
shall not have reimbursed the indemnified party in accordance with such request
prior to the date of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by
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<PAGE> 20
such indemnified party, unless such settlement includes an unconditional release
of such indemnified party from all liability on claims that are the subject
matter of such proceeding.
(e) In order to provide for just and equitable contribution under the Act
in any case in which (i) any Underwriter (or any person who controls any
Underwriter within the meaning of the Act or the Exchange Act) makes claim for
indemnification pursuant to Section 8(a) hereof, but is judicially determined
(by the entry of a final judgment or decree by a court of competent jurisdiction
and the expiration of time to appeal or the denial of the last right of appeal)
that such indemnification may not be enforced in such case notwithstanding the
fact that Section 8(a) provides for indemnification in such case or (ii)
contribution under the Act may be required on the part of any Underwriter or any
such controlling person in circumstances for which indemnification is provided
under Section 8(c), then, and in each such case, the Company and such
Underwriter shall contribute to the aggregate losses, claims, damages or
liabilities to which they may be subject as an indemnifying party hereunder
(after contribution from others) in such proportion so that such Underwriter is
responsible for the portion represented by the percentage that the underwriting
discount appearing on the cover page of the Prospectus bears to the public
offering price appearing thereon and the Company is responsible for the
remaining portion; provided, however, that, in any such case, (x) no Underwriter
shall be required to contribute any amount in excess of the underwriting
discount applicable to the Securities purchased by such Underwriter and (y) no
person guilty of a fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to a contribution from any person who was
not guilty of such fraudulent misrepresentation. The amount paid or payable by
an Underwriter as result of this Section 8(e) shall be deemed to include any
legal or other expenses reasonably incurred by such Underwriter in connection
with investigating, preparing to defend or defending any such claim.
(f) Promptly after receipt by any party to this Agreement of notice of the
commencement of any action, suit or proceeding, such party will, if a claim for
contribution in respect thereof is to be made against another party (the
"contributing party"), notify the contributing party of the commencement
thereof; but the omission so to notify the contributing party will not relieve
it from any liability which it may have to any other party for contribution
under the Act except to the extent it was unaware of such action and has been
prejudiced in any material respect by such failure or from any liability which
it may have to any other party other than for contribution under the Act. In
case any such action, suit or proceeding is brought against any party, and such
party notifies a contributing party of the commencement thereof, the
contributing party will be entitled to participate therein with the notifying
party and any other contributing party similarly notified.
9. (a) If any Underwriter shall default in its obligation to purchase the
Firm Securities which it has agreed to purchase hereunder, you may in your
discretion arrange for you or another party or other parties to purchase such
Firm Securities on the terms contained herein. If the aggregate principal amount
of Firm Securities as to which Underwriters default is more than one-eleventh of
the aggregate principal amount of all the Firm Securities and within 36 hours
after such default by any Underwriter you do not arrange for the purchase of
such Firm Securities, then the Company shall be entitled to a further period of
36 hours within which to procure another party or other parties satisfactory to
you to purchase such Firm Securities on such terms. In the event that, within
the respective prescribed periods, you notify the Company that you have so
arranged for the purchase of such Firm Securities, or the Company notifies you
that it has so arranged for the purchase of such Firm Securities, you or the
Company shall have the right to postpone the Time of Delivery for a period of
not more than seven days, in order to effect whatever changes may thereby be
made necessary in the Registration Statement or the Prospectus or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments to the Registration Statement or the Prospectus which in your opinion
may thereby be made necessary. The term "Underwriter" as used in this Agreement
shall include any person substituted under this Section with like effect as if
such person had originally been a party to this Agreement with respect to such
Firm Securities.
(b) If, after giving effect to any arrangements for the purchase of the
Firm Securities of such defaulting Underwriter or Underwriters by you or the
Company or both as provided in subsection (a) above, the aggregate principal
amount of such Firm Securities which remain unpurchased does not exceed
one-eleventh of the aggregate principal amount of all the Firm Securities, then
the Company shall have the right to require each non-defaulting Underwriter to
purchase the principal amount of the Firm Securities which such
-20-
<PAGE> 21
Underwriter agreed to purchase hereunder and, in addition, to require each
non-defaulting Underwriter to purchase its pro rata share (based on the
principal amount of Firm Securities which such Underwriter agreed to purchase
hereunder) of the Firm Securities of such defaulting Underwriter or Underwriters
for which such arrangements have not been made; but nothing shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Firm Securities of a defaulting Underwriter or Underwriters by you or the
Company as provided in subsection (a) above, the aggregate principal amount of
such Firm Securities which remain unpurchased exceeds one-eleventh of the
aggregate principal amount of all the Firm Securities, or if the Company shall
not exercise the right described in subsection (b) above to require
non-defaulting Underwriters to purchase Firm Securities of a defaulting
Underwriter or Underwriters, then this Agreement shall thereupon terminate
without liability on the part of any non-defaulting Underwriter or the Company,
except for the expenses to be borne by the Company and the Underwriters as
provided in Section 6 hereof and the indemnity agreement in Section 8 hereof;
but nothing herein shall relieve a defaulting Underwriter from liability for its
default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company, the Predecessor Companies and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Company, or an officer or director or controlling person of
the Company or any Predecessor Company, and shall survive delivery of and
payment for the Securities.
11. This Agreement shall become effective (a) if the Registration
Statement has not heretofore become effective, at the earlier of 12:00 Noon, New
York City time, on the first full business day after the Registration Statement
becomes effective, or at such time after the Registration Statement becomes
effective as you may authorize the sale of the Securities to the public by
Underwriters or other securities dealers, or (b) if the Registration Statement
has heretofore become effective, at the earlier of 24 hours after the filing of
the Prospectus with the Commission or at such time as you may authorize the sale
of the Securities to the public by Underwriters or securities dealers, unless,
prior to any such time you shall have received notice from the Company that it
elects that this Agreement shall not become effective, or you, or through you
such of the Underwriters as have agreed to purchase in the aggregate fifty
percent or more of the Firm Securities hereunder, shall have given notice to the
Company that you or such Underwriters elect that this Agreement shall not become
effective; provided, however, that the provisions of this Section and Section 6
and Section 8 hereof shall at all times be effective.
If this Agreement shall be terminated pursuant to Section 9 hereof, or if
this Agreement, by election of you or the Underwriters, shall not become
effective pursuant to the provisions of this Section, the Company and the
Predecessor Companies shall not then be under any liability to any Underwriter
except as provided in Section 6 and Section 8 hereof, but if this Agreement
becomes effective and is not so terminated but the Securities are not delivered
by or on behalf of the Company as provided herein because the Company has been
unable for any reason beyond its control and not due to any default by it to
comply with the terms and conditions hereof, the Company and the Predecessor
Companies will reimburse the Underwriters through you, for all out-of-pocket
expenses approved in writing by you, including fees and disbursements of
counsel, reasonably incurred by the Underwriters in making preparations for the
purchase, sale and delivery of the Securities, but the Company and the
Predecessor Companies shall then be under no further liability to any
Underwriter except as provided in Section 6 and Section 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter, if the
same shall have been made or given by you.
All statements, requests, notices and agreements hereunder shall be in
writing or by written telecommunication, and shall be sufficient in all respects
if delivered or sent by registered mail, if to the Underwriters, to the
Representative at 787 Seventh Avenue, New York, New York 10019, Attention:
Syndicate Department;
-21-
<PAGE> 22
provided, however, that any notice to any Underwriter pursuant to Section 8(d)
hereof shall be delivered or sent by registered mail to such Underwriter at its
address set forth in its Underwriters' Questionnaire delivered to the Company;
and if to the Company, to ICN Merger Corp., 3300 Hyland Avenue, Costa Mesa, CA
92626, Attn: Chief Executive Officer.
13. This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, the Company, the Predecessor Companies and, to the extent
provided in Section 8 and Section 10 hereof, the officers and directors of the
Company, the Predecessor Companies and each person who controls the Company, any
Predecessor Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Securities from any Underwriters shall be deemed a successor or assign by reason
merely of such purchase.
14. Time shall be of the essence of this Agreement.
15. This Agreement shall be construed in accordance with the laws of the
State of New York, without regard to the conflicts of laws principles thereof.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
-22-
<PAGE> 23
If the foregoing is in accordance with your understanding, please sign and
return to us a counterpart hereof, and upon the acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof shall
constitute a binding agreement among each of the Underwriters and the Company
and the Predecessor Companies. It is understood that your acceptance of this
letter on behalf of each of the Underwriters is pursuant to the authority set
forth in a form of Agreement Among Underwriters, manually or facsimile executed
counterparts of which, to the extent practicable and upon request, shall be
submitted to the Company for examination, but without warranty on your part as
to the authority of the signers thereof.
Very truly yours,
ICN MERGER CORP.
By:
SPI PHARMACEUTICALS, INC.
By:
ICN PHARMACEUTICALS, INC.
By:
VIRATEK, INC.
By:
ICN BIOMEDICALS, INC.
By:
Accepted as of the date hereof,
WERTHEIM SCHRODER & CO. INCORPORATED,
as Representative of the several Underwriters
named in Schedule I hereto
By:
Managing Director
-23-
<PAGE> 24
SCHEDULE I
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT
UNDERWRITER OF FIRM SECURITIES
- ----------------------------------------------------------------------------- ------------------
<S> <C>
Wertheim Schroder & Co. Incorporated.........................................
Jefferies & Company, Inc. ...................................................
Kemper Securities, Inc. .....................................................
------------------
Total................................................................... $150,000,000
=============
</TABLE>
-24-
<PAGE> 1
EXHIBIT 5
[FRIED, FRANK, HARRIS, SHRIVER & JACOBSON LETTERHEAD]
November 4, 1994
ICN Merger Corp.
3300 Hyland Avenue
Costa Mesa, California 92626
RE: ICN Merger Corp. Registration Statement (No. 33-83952)
% Convertible Subordinated Debentures Due 2004
Ladies and Gentlemen:
We are acting as special counsel to ICN Merger Corp., a Delaware
corporation (the "Company"), in connection with the Registration Statement on
Form S-1 (No. 33-83952) (the "Registration Statement") filed with the Securities
and Exchange Commission (the "Commission"), relating to the underwritten public
offering of up to $172,500,000 aggregate principal amount of % Convertible
Subordinated Debentures due 2004 (the "Debentures") of the Company, including up
to $22,500,000 aggregate principal amount of Debentures issuable upon exercise
of an over-allotment option to be granted to the underwriters. The Debentures
are convertible into shares (the "Shares") of the Company's common stock, par
value $.01 per share.
For purposes of this opinion, we have examined the originals or certified,
conformed or reproduction copies, of all such records, agreements, instruments,
certificates and documents as we have deemed necessary as a basis for the
opinions hereafter expressed. In all such examinations, we have assumed the
genuineness of all signatures on original or certified copies and the conformity
to original or certified copies of all copies submitted to us as conformed or
reproduction copies. As to various questions of fact relevant to such opinions,
we have relied upon certificates and statements of public officials and
representatives of the Company and of others.
Based upon the foregoing and subject to the limitations set forth herein,
it is our opinion that:
1. The Debentures to be offered by the Company have been duly
authorized and, when the Debentures have been issued, executed and
authenticated in accordance with the terms of the Indenture substantially
in the form attached as an exhibit to the Registration Statement (the
"Indenture") and delivered and paid for as contemplated by the Registration
Statement and the Underwriting Agreement substantially in the form attached
as an exhibit to the Registration Statement, will be the valid and legally
binding obligations of the Company.
2. The Shares which may be issued upon conversion of the Debentures
have been duly authorized and, when issued and delivered upon conversion of
the Debentures in accordance with the terms of the Indenture and as
contemplated in the Registration Statement, will be validly issued, fully
paid and non-assessable.
This opinion is limited to the federal laws of the United States of
America, the laws of the State of New York and the General Corporation Law of
the State of Delaware.
The opinion expressed in paragraph 1 above is subject to the qualification
that the enforceability against the Company of the Debentures (i) may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors' rights generally and (ii) is subject to
general principles of equity, whether such enforceability is considered in a
proceeding in equity or at law, and to the discretion of the court before which
any proceeding therefor may be brought.
<PAGE> 2
ICN Merger Corp.
Page 2 November 4, 1994
In addition, such opinion is subject to the effect of, and we express no
opinion as to the application of, any applicable fraudulent conveyance,
fraudulent transfer, or fraudulent obligation or preferential transfer law.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to this firm under the caption
"Legal Matters" in the Prospectus forming part of the Registration Statement. In
giving such consent, we do not thereby admit that we are in the category of such
persons whose consent is required under Section 7 of the Securities Act of 1933,
as amended.
The opinions expressed herein are solely for your benefit and may not be
relied upon in any manner or for any purpose except as specifically provided for
herein.
Very truly yours,
Fried, Frank, Harris, Shriver & Jacobson
By: /s/ JEFFREY BAGNER
------------------------------
Jeffrey Bagner
<PAGE> 1
EXHIBIT 99.1
ESCROW DEPOSIT AGREEMENT
BETWEEN
ICN PHARMACEUTICALS, INC.
AND
AMERICAN STOCK TRANSFER & TRUST COMPANY
AS AGENT
DATED AS OF NOVEMBER , 1994
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
Recitals............................................................................ 1
SECTION 1. Pledge of Proceeds.................................................... 1
SECTION 2. Notice of Repayment or Redemption..................................... 1
SECTION 3. Special Fund in Trust................................................. 1
SECTION 4. Application of Moneys on Deposit in ICN Trust Fund.................... 1
SECTION 5. Payment of Obligations................................................ 2
SECTION 6. Irrevocable Deposit: Relinquishment of Rights of the Company.......... 2
SECTION 7. Liability of Agent.................................................... 2
SECTION 8. Termination; Income from Authorized Investments....................... 2
SECTION 9. Fees of Agent......................................................... 2
Duties of Agent; Evidence Upon Which Agent May Act; Replacement of
SECTION 10. Agent................................................................. 3
SECTION 11. Amendments............................................................ 3
SECTION 12. Severability.......................................................... 3
SECTION 13. Governing Law......................................................... 3
SECTION 14. Counterparts.......................................................... 3
SECTION 15. Section Headings...................................................... 4
SECTION 16. Binding Effects, etc.................................................. 4
SECTION 17. Notices............................................................... 4
Signatures and Seals.................................................. 4
</TABLE>
-i-
<PAGE> 3
ESCROW DEPOSIT AGREEMENT
Escrow Deposit Agreement (the "Escrow Agreement") dated as of November ,
1994 between ICN Pharmaceuticals, Inc. (previously named ICN Merger Corp.) (the
"Company") and American Stock Transfer & Trust Company , as escrow agent (the
"Agent").
WITNESSETH:
WHEREAS, the Company has authorized and will issue, on the date hereof, up
to $172,500,000 principal amount of % Convertible Subordinated Debentures due
2004 pursuant to a registration statement on Form S-1 (the "Registration
Statement") under the Securities Act of 1993 (the "Offering"); and
WHEREAS, the Company has determined that it is in the best interests of the
Company to provide for the repayment or redemption, as the case may be, of
certrain indebtedness of the Company and its subsidiaries as listed on Schedule
I hereto (including interest accrued thereon to the date of repayment or
redemption, any prepayment penalties and any other required payments thereunder)
(the "Obligations"); and
WHEREAS, the Company has elected to deposit in trust part of the proceeds
from the Offering with an escrow agent in an amount sufficient to pay the
Obligations in full when they become due; and
WHEREAS, the Agent has agreed to act as escrow agent in connection with the
repayment or redemption, as the case may be, of the Obligations in accordance
with the terms and conditions specified in the instruments and agreements listed
on Schedule I hereto (the "Agreements");
SECTION 1. Pledge of Proceeds. The Company hereby irrevocably deposits
with the Agent, in trust for the holders of the Obligations (the "Holders"), and
irrevocably appropriates and sets aside $ (the "Deposit") exclusively
for the repayment or redemption, as the case may be, of the Obligations, which
Deposit (and any interest or other income earned thereon) is hereby pledged to,
and for the benefit of, the Holders.
The Agent hereby acknowledges receipt of the Deposit which shall be
deposited by the Agent in the ICN Trust Fund (as defined in Section 3 hereof).
The Company represents and warrants that the amount of the Deposit is sufficient
to pay all the Obligations when due, without anticipating any interest or other
income being earned on the Deposit and understands that the Holders of the
Obligations are relying upon such representations and warranties.
SECTION 2. Notice of Repayment or Redemption. The Company represents to
the Agent that the Company has given irrevocable notice of repayment or
redemption, as the case may be, to the Holders that has resulted in payments
being required to be made to the Holders in the amounts and on the dates set
forth on Schedule I hereto under the headings Amount and Payment Date,
respectively.
SECTION 3. Special Fund in Trust. There is hereby established and created
with the Agent a special and irrevocable trust fund designated the "ICN
Pharmaceuticals, Inc. Trust Fund" (the "ICN Trust Fund") to be held in the
custody of the Agent as a special trust fund, separate and apart from all other
funds of the Company or the Agent, solely for the benefit of the Holders. All
moneys and Authorized Investments (as defined in Section 4(b) hereof), set aside
and held in trust in the ICN Trust Fund shall be applied to, and applied solely
for, the repayment or redemption, as the case may be, of the Obligations and as
otherwise provided herein.
SECTION 4. Application of Moneys on Deposit in ICN Trust Fund. (a) Cash
on deposit in the ICN Trust Fund shall not be invested at any time in any
securities or other investments other than the Authorized Investments (as
defined in Section 4(b) hereof).
(b) The Agent shall act as custodian of the ICN Trust Fund and shall, at
the written direction of the Company, invest and reinvest the ICN Trust Fund
solely in the following investments, which constitute "Authorized Investments"
hereunder: (i) direct obligations of the United States Government (or agencies
or instrumentalities thereof), provided that such securities are obligations to
which the full faith and credit clause of the United States of America has been
pledged; or (ii) certificates of deposit, time deposits or other
<PAGE> 4
interest-bearing deposits of commercial banks having total capital and surplus
of at least $500,000,000, in each case with a maturity or maturities that would
permit the Agent to make cash payments to repay or redeem, as the case may be,
the Obligations on the various payment dates listed on Schedule I hereto in
accordance with Section 5 hereof. The Agent shall have no responsibility for the
determination of such investments and shall have no liability for any investment
losses resulting from the investment, reinvestment, sale or liquidation of the
ICN Trust Fund, except in the case of its own gross negligence or willful
misconduct.
(c) Except as otherwise specifically provided herein, the Company covenants
and agrees that the Agent shall have full and complete control and authority
over the with respect to the ICN Trust Fund and the moneys deposited therein and
the Company shall not exercise any control or authority over or with respect to
the ICN Trust Fund or the moneys deposited therein.
SECTION 5. Payment of Obligations. On each of the payment dates listed on
Schedule I hereto, the Agent shall apply sufficient funds, to the extent
available, from the funds held in the ICN Trust Fund to the payment in full of
the applicable Obligation (as such payment is directed to be made on Schedule I
hereto under the heading Method of Payment); provided, however, that the Company
may direct the Agent to make an earlier payment in full of any particular Class
of Obligations (as such Classes of Obligations are defined on Schedule I) if all
Holders of Obligations included within such Class of Obligations are paid in
full on the same date and the aggregate amount of the payments made to such
Holders on the earlier payment date is less than or equal to the sum of money
deposited on behalf of such Holders as set forth on Schedule I. To the extent
sufficient funds are not available, the Company agrees to deposit the necessary
funds in the ICN Trust Fund in order for such Obligation to be paid in full on
the payment dates specified on Schedule I hereto and understands that the
Holders of the Obligations are relying upon such agreement.
SECTION 6. Irrevocable Deposit: Relinquishment of Rights of the
Company. (a) The deposit of the moneys in the ICN Trust Fund shall constitute
an irrevocable deposit in trust solely for the payment of the Obligations, and
solely for the benefit of the Holders thereof pursuant to the terms of the
applicable Agreements and this Escrow Agreement.
(b) The Company hereby agrees that it shall not have any beneficial
interest in, or rights to, any moneys or proceeds thereof (or interest or other
income earned thereon) on deposit in the ICN Trust Fund (whether in the form of
cash, Authorized Investments or otherwise) or payments made therefrom so long as
any of the Obligations or any amounts owing to the Agent hereunder remain
unpaid.
SECTION 7. Liability of Agent. The liability of the Agent to make the
payments required by this Escrow Agreement with respect to the Obligations shall
be limited to application of the funds deposited with it hereunder. The Agent
shall not be liable for any loss resulting from any investment made in
compliance with the provisions of this Escrow Agreement.
SECTION 8. Termination; Income from Authorized Investments. (a) This
Escrow Agreement shall terminate when all Obligations to the Holders shall have
been paid to the Holders and all fees and expenses of the Agent shall have been
paid in full.
(b) Upon termination of this Escrow Agreement in accordance with the
provisions of subsection (a) of this Section 8, any funds in the ICN Trust Fund
(including income from all Authorized Investments) shall be promptly paid to the
Company.
SECTION 9. Fees of Agent. (a) The Company shall pay upon request all
necessary and proper fees, compensation and expenses of the Agent, including,
without limitation, reasonable compensation for all services rendered by the
Agent in the execution, exercise and performance of any of the duties to be
exercised or performed by it pursuant to the provisions of this Escrow
Agreement. Attached hereto as Exhibit II is the Agent's fee schedule. The Agent
shall be entitled to indemnity from the Company against any and all losses,
claims, liabilities or expenses incurred on the part of the Agent arising out of
or in connection with the acceptance or administration of its powers and duties
under this Escrow Agreement, including the cost and expense of defending against
any such loss, claim or liability, other than losses, claims, liabilities or
expenses arising out of the Agent's gross negligence or willful misconduct.
2
<PAGE> 5
(b) The Agent has no right to payment for its fees, compensation and
expenses from the ICN Trust Fund so long as all of the Obligations shall not
have been paid in full.
(c) All of the rights, entitlements, and protections provided to the Agent
in this Section 9 shall survive its resignation or termination of this Escrow
Agreement, whether by payment of the Obligations or otherwise.
SECTION 10. Duties of Agent; Evidence Upon Which Agent May Act;
Replacement of Agent. (a) The duties and obligations of the Agent hereunder
shall be determined solely by the express provisions of this Escrow Agreement,
and the Agent shall not be liable except for the performance of its duties and
obligations as specifically set forth herein and to act in good faith in the
performance thereof, and no implied duties or obligations shall be incurred by
the Agent other than those specified herein, and the Agenet shall be protected
when acting or omitting to act in good faith upon the advice of counsel, who may
be counsel to the Company.
(b) Subject to the requirement under subsection (a) of this Section 10 to
act in good faith, the Agent may conclusively rely, as to the correctness of
statements, conclusions and opinions therein, upon any certificate, report,
opinion or other document furnished to the Agent pursuant to any provision of
this Escrow Agreement. Any request, consent, certificate, notice, appointment or
other direction made or given by the Company to the Agent shall be deemed to
have been sufficiently made or given by the proper party or parties if executed
by an authorized officer of the Company on behalf of the Company.
(c) The Agent may not resign until a New York successor shall have been
appointed and the funds held by the Agent have been transferred to such
successor agent. Any such successor agent shall be a commercial bank having
total capital and surplus of at least $500,000,000.
SECTION 11. Amendments. This Escrow Agreement shall not be repealed,
revoked, altered or amended or any provisions thereof waived as to any of the
Obligations without the written consent of all Holders of each such Obligation,
the written consent of the Agent and the written consent of the Company;
provided, however, that the Company and the Agent may, without the consent of,
or notice to, the Holders, enter into such agreements supplemental to this
Escrow Agreement as shall not adversely affect the rights of the Holders, for
any one or more of the following purposes:
(a) to cure any ambiguity, defect or omission in this Escrow
Agreement;
(b) to grant to, or confer upon the Agent for the benefit of the
Holders any additional rights, remedies, powers or authority that may
lawfully be granted to, or conferred upon, the Agent.
SECTION 12. Severability. If any one or more of the covenants or
agreements provided in this Escrow Agreement on the part of the Company or the
Agent to be performed should be determined by a court of competent jurisdiction
to be contrary to law, such covenant or covenants, or such agreement or
agreements, or such portions thereof, shall be deemed severed from the remaining
covenants and agreements or portions thereof provided in this Escrow Agreement
and the invalidity thereof shall in no way affect the validity of other
provisions of this Escrow Agreement, but the Holders shall retain all the rights
and benefits accorded them hereunder and under applicable provisions of law. If
any provisions of this Escrow Agreement shall be held or deemed to be or shall,
in fact, be inoperative or unenforceable or invalid as applied in any particular
case in any jurisdiction or jurisdictions or in all jurisdictions, or in all
cases becuase it conflicts with any constitution or statute or rule of public
policy, or for any other reason, such circumstances shall not have the effect of
rendering the provision in question inoperative or unenforceable or invalid in
any other case or circumstance, or of rendering any other provision or
provisions herein contained inoperative or unenforceable or invalid to any
extent whatever.
SECTION 13. Governing Law. This Escrow Agreement shall be construed and
interpreted in accordance with the laws of the State of New York, without regard
to its conflict of law principles.
SECTION 14. Counterparts. This Escrow Agreement may be executed in
several counterparts, all or any of which shall be regarded for all purposes as
one original and shall constitute and be but one and the same instrument.
3
<PAGE> 6
SECTION 15. Section Headings. The headings of the several Sections hereof
and the Table of Contents appended hereto shall be solely for convenience of
reference and shall not affect the meaning, construction, interpretation or
effect of this Escrow Agreement.
SECTION 16. Binding Effect, etc. This Escrow Agreement shall be binding
upon the parties hereto and their respective successors, legal representatives
and permitted assigns.
SECTION 17. Notices. Any notices or other communicaitons to be given
hereunder by any party hereto to the other party shall be in writing and shall
be given by delivery in person, by electronic facsimile transmission or other
standard forms of written telecommunications, by overnight courier or by
registered or certified mail, postage prepaid, as follows:
if to the Company, to:
ICN Pharmaceuticals, Inc.
3300 Hyland Avenue
Costa Mesa, CA 92626
Telecopy number:
Attention: Chief Executive Officer
if to the Agent, to:
American Stock Transfer & Trust Company
Telecopy number:
Attention: Corporate Trust Department
Direction from the Company to the Agent to be given under the terms of this
Escrow Agent shall only be made on behalf of the Company by the following
persons (or such additional persons as may be appointed by any of the persons
named below or their appointees by written notice to the Agent):
IN WITNESS WHEREOF, the parties have each caused this Escrow Agreement to
be executed by their duly authorized officers as of the date first above
written.
ICN PHARMACEUTICALS, INC.
By
Name:
Title:
AMERICAN STOCK TRANSFER & TRUST
COMPANY,
as Agent
By
Name:
Title:
4
<PAGE> 7
SCHEDULE I
<TABLE>
<CAPTION>
CLASS OF METHOD OF
OBLIGATION HOLDER AMOUNT PAYMENT DATE PAYMENT
- ------------ -------- -------- -------------- -----------
<S> <C> <C> <C> <C>
</TABLE>
5
