As filed with the Securities and Exchange Commission on June 20, 2000
---------------------------------------------------------------------
FileNovember 6, 2001
Registration No. 333-
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
------------------
SHIRE PHARMACEUTICALS GROUP PLC
(Exact name of Registrant as specified in its charter)
England and Wales Not Applicable
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
Shire Pharmaceuticals Group plc
East Anton
Andover
Hampshire SP10 5RG
ENGLAND
(44) 1-264-333455-------------------
SHIRE FINANCE LIMITED SHIRE PHARMACEUTICALS GROUP PLC
(Exact name of registrant as specified in its charter) (Exact name of registrant as specified in its charter)
Cayman Islands England and Wales
(State or other jurisdiction of (State or other jurisdiction of
incorporation or organization) incorporation or organization)
Applied For Applied For
(I.R.S. Employer Identification No.) (I.R.S. Employer Identification No.)
Hampshire International Business Park Hampshire International Business Park
Chineham, Basingstoke Chineham, Basingstoke
Hampshire RG24 8EP Hampshire RG24 8EP
England England
(44) 1-256-894-000 (44) 1-256-894-000
(Address, including zip code, and telephone number, (Address, including zip code, and telephone number,
including area including area
code, of registrant's principal executive offices) code, of registrant's principal executive offices)
------------------
William A. Nuerge
Shire Richwood Inc.
7900 Tanners Gate Drive
Florence, Kentucky 41042
(606) 282-2100
CT Corporation System
111 Eighth Avenue
New York, New York 10011
(212) 590-9200
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
-------------------------------------
Copies of all orders, notices and communications to:
William A. Nuerge John P. Mitchell, Esq.
Shire US Inc. Cahill Gordon & Reindel
7900 Tanners Gate Drive 80 Pine Street
Florence, Kentucky 41042 New York, New York 10005
(212) 701-3000NY 10005-1702
-------------------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this registration statement becomes effective.
------------------Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]/ /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]/X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]________________/ /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]_______________
/ /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]/ /
CALCULATION OF REGISTRATION FEE
======================================== ====================================== ================ ===================== ===================== =============================================== =======================
Proposed maximum Proposed maximumMaximum
Title of each class ofSecurities to Amount to be offering price per aggregate offeringBe Offering Price Proposed Maximum Amount of
securities to be registered registered ordinary share price registration fee
- ---------------------------------------- --------------Be Registered Registered Per Note (1) Aggregate Offering Price Registration Fee
(1)
------------------------ ---------------- --------------------- --------------------- ----------------------------------------------- -----------------------
ordinary2% Senior Guaranteed
Convertible Notes of
Shire Finance Limited $400,000,000 100% $400,000,000 $100,000
due 2011
------------------------ ---------------- --------------------- ----------------------------- -----------------------
Preference Shares of
Shire Finance Limited
400,000 shares (2) (2) (2)
------------------------ ---------------- --------------------- ----------------------------- -----------------------
Guarantees of Shire
Pharmaceuticals Group
plc (3) (3) (3) (3)
------------------------ ---------------- --------------------- ----------------------------- -----------------------
Ordinary Shares of
Shire Pharmaceuticals
Group plc, nominal value(pound).05 21,214,628 $ 15.13 (1) $ 320,977,321.64 (1) $84,738.01(5) (6) (6) (6)
value 5p per share
======================================================================================================================Ordinary
Share (4)
======================== ================ ===================== ============================= =======================
(1) The proposed maximum offering price per ordinary share and inThis estimate is made pursuant to Rule 457(c) of the aggregate
have been estimatedSecurities Act solely
for the purposepurposes of computingdetermining the registration fee.fee and is exclusive of
accrued interest.
(2) Pursuant to Rule 457(c)457(i), there is no additional filing fee required with
respect to the registration feePreference Shares issued upon conversion of the Notes
because no additional consideration will be received in connection with the
exercise of the conversion privilege.
(3) Shire Pharmaceuticals Group plc has been calculated basedfully and unconditionally guaranteed
all payments of principal and interest on the averageNotes and all payments of
dividends, redemption amounts and liquidation preferences in respect of the
high and low prices forPreference Shares. Pursuant to Rule 457(n), there is no additional filing
fee required with respect to the ordinary sharesGuarantees.
(4) American Depositary Shares ("ADSs") evidenced by American Depositary
Receipts issuable upon deposit of Ordinary Shares, nominal value 5p each,
of Shire Pharmaceuticals Group plc are registered on June 14, 2000,a separate
Registration Statement on Form F-6 (Registration No. 333-13190), filed with
the Securities and Exchange Commission on February 16, 2001. Each ADS
represents three Ordinary Shares.
(5) There is being registered hereunder an indeterminate number of Ordinary
Shares which may be issued upon exchange of the Preference Shares issuable
upon conversion of the Notes. Each $1,000 principal amount of Notes may be
converted into one Preference Share. No additional consideration will be
received in connection with the exercise of the conversion privilege or the
exchange of Preference Shares. The Preference Shares will be immediately
exchanged, subject to the option of Shire Finance Limited to have Shire
Pharmaceuticals Group plc pay cash upon exchange, into Ordinary Shares at
the rate of 49.61745 Ordinary Shares per Preference Share or 16.5392 ADSs
per Preference Share, subject to adjustment under certain circumstances. At
the date hereof, the number of Ordinary Shares which may be issued upon
exchange of the Preference Shares issued upon conversion of the Notes is
19,846,980 and the number of ADSs which may be issued upon exchange of the
Preference Shares issued upon conversion of the Notes is 6,615,680.
Pursuant to Rule 416 under the Securities Act, such number of Ordinary
Shares registered hereby shall include an indeterminate number of Ordinary
Shares that may be issued in connection with a stock split, stock dividend,
recapitalization or similar event or adjustment in the number of Ordinary
Shares which may be issued upon exchange of the Preference Shares as
reported onprovided in the London Stock Exchangeterms of the Preference Shares contained in the Amended and
Restated Memorandum and Articles of Association of Shire Finance Limited.
----------------------------(6) Pursuant to Rule 457(i), there is no additional filing fee required with
respect to the Ordinary Shares which may be issued upon exchange of the
Preference Shares because no additional consideration will be received in
connection with the exchange.
The RegistrantRegistrants hereby amendsamend this Registration Statement on such date or
dates as may be necessary to delay its effective date until the RegistrantRegistrants
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, as amended, or until thethis Registration Statement
shall become effective on such date as the Securities and Exchange Commission,
acting pursuant to said Section 8(a), may determine.
===============================================================================
Information contained hereinThe information in this prospectus is subject to completion or amendment. Anot complete and may be changed. The
selling securityholders may not sell these securities until the registration
statement relating to these securities has been filed with the Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomesCommission is effective. This
prospectus shallis not constitute an offer to sell or the
solicitation ofthese securities and it is not soliciting an
offer to buy nor shall there be any sale of these securities in any jurisdiction in which suchwhere the offer solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of any such
jurisdiction.is not
permitted.
SUBJECT TO COMPLETION, DATED June 20, 2000NOVEMBER 6, 2001
PRELIMINARY PROSPECTUS
SHIRE FINANCE LIMITED
$400,000,000
2% Senior Guaranteed Convertible Notes due 2011
Guaranteed by Shire Pharmaceuticals Group plc
21,214,628---------------
SHIRE PHARMACEUTICALS GROUP PLC
Ordinary Shares ----------------------
21,214,628and American Depositary Shares
which may be issued upon exchange of Preference Shares
that will be issued upon Conversion of the Notes
---------------
Selling securityholders will use this prospectus to resell their notes and
the ordinary shares nominal value 5p peror American Depositary Shares, or ADSs, issuable upon
exchange of the preference shares that will be issued upon conversion of the
notes.
The notes are:
o unsecured;
o unsubordinated;
o in respect of payments of principal and interest, fully and
unconditionally guaranteed by Shire Pharmaceuticals Group plc;
o convertible, at any time prior to August 14, 2011 or their redemption
or repurchase, into preference shares of Shire Finance, which shares
will then be immediately exchanged by Shire Finance for
- ordinary share,shares of Shire Pharmaceuticals Group plc, a public limited company incorporated under the
lawsor
- at your option in specified circumstances, ADSs of England and Wales, are being offered by this prospectus. TheShire
Pharmaceuticals Group, representing ordinary shares, will be sold from timeat an
exchange ratio, subject to timeadjustment, equal to 49.6175 ordinary
shares per preference share or 16.5392 ADSs per preference share.
At Shire Finance's option, Shire Pharmaceuticals Group may deliver cash
instead of ordinary shares or ADSs in exchange for the preference shares;
o redeemable by Shire Finance for cash on or after August 21, 2004 at
the selling shareholders namedredemption price described in this prospectus;
o redeemable at the option of holders on each of August 21, 2004, August
21, 2006, and August 21, 2008 at the purchase price described in this
prospectus; and
o redeemable at the option of holders under specified change of control
events as described in this prospectus.
We will not receive any proceeds fromOn November 5, 2001, the last reported sale ofprice for Shire Pharmaceuticals
Group's ordinary shares on the London Stock Exchange was (pound)10.65 per share,
and the last reported sale price for Shire Pharmaceuticals Group's ADSs on the
Nasdaq National Market was $46.74 per ADS. Each ADS represents three ordinary
shares. The ordinary shares are listed and trade on the London Stock Exchange
Limited under the symbol "SHP.L" Three ordinary shares are represented by one
American Depositary Share (an "ADS"). Theand the ADSs are
evidenced by American
Depositary Receipts ("ADRs") and are listed and trade on The Nasdaq National
Marketquoted under the symbol "SHPGY." On June 14, 2000, the reported closing middle
market quotation for the ordinary shares as derived from the London Stock
Exchange's Daily Official List was (pound)10.06, equivalent to a price of $45.38
per ADS translated at the exchange rate of (pound)1.00 = $1.5038 as published on
such date. On June 14, 2000 the reported closing price of our ADSs as reported
on The Nasdaq National Market was $45.125 per ADS.
--------------------
The selling shareholders will pay any expenses incurred by them for
brokerage, accounting, tax or legal services or any other expenses incurred by
the selling shareholders in disposing of the ordinary shares. We will bear all
other costs, fees and expenses incurred in effecting the registration of the
ordinary shares covered by this prospectus, including, without limitation, all
registration and filing fees, London Stock Exchange listing fees and expenses of
our counsel and our accountants.
See "Risk Factors" starting on page 2 for a discussion of the risks
involved with investing in our ordinary shares.
--------------------
Neither the Securities and Exchange Commission nor any other regulatory
bodystate securities
commission has approved or disapproved of these securities or passed upon the
accuracyadequacy or adequacyaccuracy of this prospectus. Any representation to the contrary is a
criminal offense.
See "Risk Factors" beginning on page 6 of this prospectus to read about
important factors you should consider before buying the notes or Shire
Pharmaceuticals Group's ordinary shares or ADSs.
---------------
The date of this prospectus is June 20, 2000.[________], 2001.
---------------
TABLE OF CONTENTS
Prospectus
Page
About this Prospectus..................................................... ii
Cautionary Statement Concerning Forward-Looking Statements................ ii
Summary................................................................... 1
Risk Factors.............................................................. 6
Use of Proceeds........................................................... 8
Price Range of Common Equity and Dividend Policy.......................... 8
Capitalization............................................................ 10
Selected Financial and Operating Data..................................... 11
Description of the Notes.................................................. 12
Description of the Preference Shares...................................... 40
The Issuer................................................................ 43
Description of the Ordinary Shares........................................ 44
Description of the American Depositary Shares and American
Depositary Receipts..................................................... 52
Certain Cayman Islands, U.K. and U.S. Tax Considerations.................. 59
Selling Securityholders................................................... 72
Plan of Distribution...................................................... 76
Enforcement of Civil Liabilities.......................................... 79
Legal Matters............................................................. 79
Independent Auditors...................................................... 79
Available Information..................................................... 79
Incorporation of Documents by Reference................................... 80
There are restrictions on the offer and sale of the notes in the United
Kingdom. All applicable provisions of the Financial Services Act 1986, the
Financial Services and Markets Act 2000 and the Public Offers of Securities
Regulations 1995 with respect to anything done by any person in relation to the
notes, the ordinary shares and the ADSs in, from or otherwise involving the
United Kingdom must be complied with.
No invitation to the public in the Cayman Islands to subscribe for or
purchase any of the notes or preference shares may be made unless the issuer is,
at the relevant time, listed on the Cayman Islands Stock Exchange.
No dealer, salesperson or other person is authorized to give any
information or to represent anything not contained in this prospectus. You must
not rely on any unauthorized information or representations. This prospectus is
an offer to sell only the notes and ordinary shares offered hereby, but only
under circumstances and in jurisdictions where it is lawful to do so. The
distribution of this prospectus and the offer or sale of the notes, ordinary
shares and ADSs in certain jurisdictions may be restricted by law. This
prospectus does not constitute an offer or invitation to sell the notes,
ordinary shares or ADSs in any jurisdiction in which such offer or invitation
would be unlawful and Shire Finance and Shire Pharmaceuticals Group do not
accept any responsibility for any violation by any person of any such
restrictions. The information contained in this prospectus is current only as of
its date.
Until , 2002 all dealers that effect transactions in these securities,
whether or not participating in this offering, may be required to deliver a
prospectus. This is in addition to the
-i-
dealers' obligations to deliver a prospectus when acting as underwriters and
with respect to their unsold allotments or subscriptions.
-ii-
ABOUT THIS PROSPECTUS
This prospectus constitutes part of a registration statement on Form S-3
that Shire and the issuer filed with the SEC using a "shelf" registration
process. Under this shelf process, any selling securityholder may sell any
combination of the securities described in this prospectus in one or more
negotiated transactions or otherwise, at market prices prevailing at the time of
sale or at negotiated prices. This prospectus provides you with a general
description of the securities the selling securityholders may offer. Each time
the selling securityholders sell securities, we or the selling securityholders
will provide a prospectus supplement that will contain specific information
about the terms of that offering. The prospectus supplement may also add, update
or change information contained in this prospectus. You should read both this
prospectus and any prospectus supplement together with the additional information
described under the heading "Where You Can Find More Information."Available Information" and "Incorporation of
Documents by Reference."
TABLE OF CONTENTS
Page
----
THE COMPANY...............................................................1
RISK FACTORS..............................................................2
USE OF PROCEEDS...........................................................3
SELLING SHAREHOLDERS......................................................4
PLAN OF DISTRIBUTION......................................................5
INCORPORATION OF DOCUMENTS BY REFERENCE; ADDITIONAL INFORMATION...........6
LEGAL MATTERS.............................................................6
EXPERTS...................................................................6
THE "SAFE HARBOR"This prospectus summarizes certain documents and other information, and
Shire and the issuer refer you to the actual documents for a more complete
understanding of what Shire and the issuer discuss in this prospectus. Shire
will make copies of the actual documents available to you upon request.
In this prospectus, references to "dollars," "U.S.$" and "$" are to U.S.
dollars.
CAUTIONARY STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995......................................................7
INDEMNIFICATION OF DIRECTORS AND OFFICERS.................................7
-i-CONCERNING FORWARD-LOOKING STATEMENTS
Statements contained in this prospectus and in Shire's filings with the SEC
incorporated by reference in this prospectus that are not historical facts are
forward-looking statements made pursuant to the safe harbor provisions of the
federal securities laws. These forward-looking statements involve risks and
uncertainties, including, but not limited to, risks associated with the inherent
uncertainty of pharmaceutical research, product development and
commercialization, the impact of competitive products, patents and other risks
and uncertainties, including those detailed from time to time in periodic
reports, including the annual report for the year ended December 31, 2000 on
Form 10-K and in the proxy statement for the extraordinary general meeting of
shareholders, dated March 1, 2001, filed by Shire with the SEC. Shire and the
issuer caution that the risks and factors discussed in these filings are not
exclusive. Shire and the issuer have no obligation to publicly update or revise
any forward-looking statements, whether as a result of new information, future
events or risks. New information, future events or risks may cause the
forward-looking events Shire and the issuer discuss in this prospectus and in
the filings with the SEC that Shire and the issuer incorporate by reference in
this prospectus not to occur.
-iii-
THE COMPANY
We are anSUMMARY
The following summary is qualified in its entirety by the more detailed
information appearing elsewhere in or incorporated by reference into this
prospectus. Prospective investors should consider carefully the information set
forth in this prospectus under the heading "Risk Factors" and the documents
incorporated in this prospectus by reference identified under the heading
"Incorporation of Documents by Reference." Unless the context requires
otherwise, references to the "issuer" refer to Shire Finance Limited, references
to "Shire" refer to Shire Pharmaceuticals Group plc, and references to "we,"
"us" and "our" refer to Shire Pharmaceuticals Group plc and its subsidiaries,
including the issuer.
Shire
Following the merger with BioChem Pharma Inc. on May 11, 2001, we became
one of the world's leading international specialty pharmaceutical company withcompanies. We
have a strategic focus on fourthree therapeutic areas: central nervous systemsystems
disorders, metabolic diseases, canceroncology and gastrointestinal disorders.anti-infectives. Our strategy is further supported by
two technology platforms, drug delivery and biologics. We operatehave a global sales
and managemarketing infrastructure with a broad portfolio of products and our businessown
direct marketing capability in three geographic areas: the United States, EuropeCanada, the United Kingdom,
the Republic of Ireland, France, Germany, Italy and the rest
of the world.Spain, with plans to add
Japan by 2004. We also cover other significant pharmaceuticals markets
indirectly through distributors. Our business is managed within three individual
operating segments: U.S., International and global research and development.
Within these geographical segments revenues are derived from three sources: sales of products
by our own sales and marketing operations, royalties and licensing and
development fees,fees. We refer to ourselves as "specialty" because our principal
products tend to be prescribed by specialists as opposed to primary care
physicians. A comparatively small sales force such as ours can promote specialty
products effectively while it could not be expected to achieve the necessary
coverage of primary care physicians. Our main approach is to in-license
projects, to develop them and royalties. Saleslaunch them ourselves in the eight key world
markets. We seek to protect the intellectual property upon which we rely through
a range of patents and marketing operations
are principallypatent applications (both our own and those of our
licensors).
Our principal products include:
o in the United States, Adderall for the treatment of Attention Deficit
Hyperactivity Disorder; Agrylin for the treatment of elevated blood
platelets; Pentasa for the treatment of ulcerative colitis; Carbatrol
for the treatment of epilepsy; and ProAmatine for the treatment of
orthostatic hypotension. In addition, we receive royalties on the
sales of Reminyl for the treatment of Alzheimer's disease, marketed by
Johnson & Johnson, and on Epivir, Combivir and Trizivir for the
treatment of HIV/AIDS and Epivir-HBV for the treatment of hepatitis B,
each marketed by GlaxoSmithKline;
o in the United Kingdom, Irelandthe Calcichew range, used primarily as adjuncts
in the treatment of osteoporosis, and Canada.Reminyl, which was launched in
September 2000 and is co-promoted by Janssen-Cilag;
o in Canada, 3TC for the treatment of HIV/AIDS, Combivir and Heptovir
(marketed in partnership with GlaxoSmithKline); Amatine; Second Look,
a breast cancer diagnostics product (Shire hopes to receive U.S. Food
and Drug Administration approval in 2001 for this product); and
Fluviral S/F, a vaccine for the prevention of influenza; and
o in the rest of the world, we receive royalties on the sales of Zeffix
for the treatment of hepatitis B, marketed by GlaxoSmithKline, and
will receive royalties on sales of Reminyl from Janssen Pharmaceutica.
-1-
In addition, we have a number of products in late stage development
including Dirame for the treatment of moderate to severe pain, Foznol for the
treatment of high blood phosphate levels associated with kidney failure and
Troxatyl for the treatment of leukemia and solid tumors. We have expanded our business both organically and through acquisitions, includingsubmitted the first
regulatory submission for Foznol under the European Mutual Recognition Procedure
on March 13, 2001.
The BioChem merger was accounted for as a merger with Roberts Pharmaceutical Corporationpooling of interests under U.S.
generally accepted accounting principles. Accordingly, all prior period
information contained in December 1999.
We arethis prospectus includes the results of BioChem as
though it had always been a part of us.
Shire is a public limited company organizedincorporated under the laws of England
and Wales. Our principal executive offices and registered office are located in East Anton, Andover,at
Hampshire SP10 5RG,International Business Park, Chineham, Basingstoke, Hampshire RG24
8EP, England, and our telephone number is (44) 1-264-33345.
-1-1-256-894-000.
-2-
RISK FACTORS
An investment inThe Offering
The following summary contains basic information about the notes. It may
not contain all the information that is important to you. For a more complete
understanding of the terms of the notes, please refer to the section of this
prospectus entitled "Description of the Notes."
Securities Offered $400,000,000 aggregate
principal amount of 2% Senior
Guaranteed Convertible Notes of the
issuer due 2011, convertible into
preference shares of the issuer; and
ordinary shares offered hereby involvesor ADSs of Shire
which will be immediately issued in
exchange for the preference shares
upon their issuance,
in each case to be sold by the
selling securityholders listed
under "Selling Securityholders"
beginning on page 72.
Interest The issuer will pay interest on the
notes at a high
degreerate of risk. In addition2% per year on
February 21 and August 21 of each
year to the other information contained in this
prospectus, prospective investors should carefully consider the following risk
factors in evaluating Shire and its business before purchasing anyholders of record of the
notes on the February 6 or August 6,
respectively, preceding the relevant
interest payment date. The first
interest payment will be made on
February 21, 2002.
Issue Price 100%.
Maturity Date August 21, 2011.
Redemption at Maturity Unless previously
redeemed, converted or repurchased
and canceled, the issuer will redeem
the notes at 100% of their principal
amount together with accrued and
unpaid interest on August 21, 2011.
Ranking The notes are senior unsecured
obligations of the issuer, ranking
equally with all of the other
unsecured senior indebtedness of the
issuer and effectively junior to all
of its secured indebtedness.
Conversion and Exchange You may convert your notes into
preference shares of the issuer at
any time prior to August 14, 2011 or
their redemption or repurchase. Each
$1,000 principal amount of notes may
be converted into one preference
share, which will be issued at an
issue price of $1,000 each. These
preference shares may, in turn, be
immediately exchanged by the issuer
for (i) our ordinary shares offered hereby. In addition, see page 16or (ii)
at your option, in specified
circumstances, ADSs representing
ordinary shares, initially at an
exchange ratio equal to 49.6175
ordinary shares per preference share
or 16.5392 ADSs per preference
share. The exchange ratio is subject
to adjustment upon the occurrence of
our Form 10-K forspecified events described under
"Description of the
year ending December 31, 1999 thatNotes--Conversion and Exchange
Rights--Adjustments to the Exchange
Ratio." Each ADS represents three
ordinary shares. At the issuer's
option, we incorporate in this prospectus by
reference.
The trading pricemay deliver cash instead
of our ordinary shares is volatile. The trading priceor ADSs in
exchange for the preference shares.
-3-
Redemption at Option of Holders On each of August 21, 2004, August
21, 2006 and August 21, 2008, you
will have the right to require the
issuer to redeem all or part of your
notes not previously redeemed,
repurchased or converted at 100% of
their principal amount plus accrued
interest. At the issuer's option,
the issuer may choose, instead of
redeeming a note in cash, to convert
all or part of a note into
preference shares which will then be
exchanged by the issuer into our
ordinary shares could beor, at your option
and in specified circumstances,
ADSs, at a specified exchange ratio.
Change in Control If we experience specific kinds of
changes in control, you will have
the right to require the issuer to
redeem all or part of your notes not
previously redeemed, repurchased or
converted at 101% of their principal
amount, plus accrued interest. At
the issuer's option, the issuer may
choose, subject to wide fluctuationsspecified
conditions, to convert all or part
of a note into preference shares
which will then be exchanged by the
issuer for our ordinary shares or,
at your option and in responsespecified
circumstances, ADSs, at a specified
exchange ratio.
Optional Redemption by the Issuer On or after
August 21, 2004, the issuer may
redeem all or part of a note which
has not previously been converted at
a redemption price equal to quarter-to-quarter variations in our operating results, developments or disputes
concerning intellectual property rights, technological innovations or new
products, government regulatory action, general conditions100% of
its principal amount, plus accrued
interest, in the pharmaceutical
industry, increased price competition, changescircumstances
described under "Description of the
Notes--Optional Redemption by the
Issuer."
The Guarantees We are fully and unconditionally
guaranteeing all payments of
principal and interest on the notes
and, following conversion of the
notes into preference shares of the
issuer, all payments of dividends,
redemption amounts and liquidation
preferences in earnings estimates by analysts
or other events or factors, manyrespect of which are beyond our control. In addition,
the
stock market has experienced extreme price and volume fluctuations.
We do not intend to pay cash dividends for the foreseeable future.preference shares. We have never paid cash dividends onagreed
not to alter our obligation to the
issuer to issue our ordinary shares
in order that the issuer may comply
with it's exchange obligations under
the preference shares. We do not intendhave also
agreed to pay
cash dividends inensure the foreseeable future. Our credit facility contains various
financial covenants which restrict,issuer's
performance of its conversion and
exchange obligations under the notes
and preference shares and its
articles and memorandum of
association.
Limitation on Mergers and
Sales of Assets The indenture governing
the notes, among other things,
limits our ability to pay cash
dividends.
Wesell our
assets substantially as an entirety
or consolidate or merge with or into
other companies, unless certain
conditions are named as a defendant in a large number of lawsuits involving
phentermine and may incur significant liability if we lose one or more of these
suits. As of April, 2000, we were a defendant in approximately 3,600 lawsuits,
in both federal and state courts, which seek damages for, among other things,
personal injury arising from phentermine products supplied for the treatment of
obesity by us and several other pharmaceutical companies. Wemet.
Listing The notes have been sued as a
manufacturer and distributor of phentermine, an anorectic used inadmitted to the
short-term
treatment of obesity and oneOfficial List of the products addressedU.K. Listing
Authority and to trading on the
London Stock Exchange's market for
listed securities. Shire's ordinary
shares are traded on the London
Stock Exchange under the symbol
"SHP.L" and its ADSs are traded on
the Nasdaq National Market under the
symbol "SHPGY."
Governing Law The notes, the indenture and the
preference share guarantee are
governed by New York law. The terms
of the preference shares are
governed by the lawsuits. Ifmemorandum and
articles of association of the
issuer, a Cayman Islands exempted
limited company.
-4-
Tax Status All payments in respect of
the notes or the guarantees will be
made without withholding of or
deduction for or on account of
taxation unless the withholding or
deduction is required by law.
Neither the issuer nor we are found liable in some or all of these lawsuits for damages in excess of our
assets, we wouldwill be
required to consider reorganizing and seeking protection in
bankruptcy or initiating insolvency proceedings. The suits relate to phentermine
either alone or together with fenfluramine or dexfenfluramine. In 136 of these
suits, the plaintiffs have specifically alleged in the complaint or subsequent
discovery that they used Oby-Cap or Oby-Trim, phentermine products produced by
us. The lawsuits generally allege the following claims:
o the defendants marketed phentermine and the other products for the
treatment of obesity and misled users about the products and the
dangers associated with them;
o the defendants failed to adequately test phentermine individually and
when taken in combination with the other drugs; and
o the defendants knew or should have known about the negative effects of
the drug and should have informed the public about such risks and/or
failed to provide appropriate warning labels.
We became involved with phentermine through the acquisition of certain
assets of Rexar Pharmaceutical Corp. in January 1994. In addition to liabilitypay you any additional
amounts as a result of its own productionany
withholding or deduction that is
required by law.
Use of Oby-Cap, plaintiffs may seek to impose
liability on us as a successor to Rexar. Class certification has been sought for
certain of the claims made against us and the other defendants. In addition,
pending federal lawsuits have been consolidated as a multidistrict litigation in
the Eastern District of Pennsylvania.
-2-
We intend to vigorously defend all lawsuits and pursue all available
reasonable defenses. Legal expenses have thus far been paid by the insurers of
our supplier, Eon Labs Manufacturing Inc. Through approximately March 2000, Eon
and its distributors, including us, had exhausted approximately $39 million in
insurance proceeds defending the lawsuits. As of March 2000, additional
insurance was available to us and the other Eon distributors through Eon's
carriers in the amount of approximately $12 million in the aggregate. In
addition, we have our own insurance up to a maximum of $3 million for lawsuits
filed in the period to April 28, 1998, an unlimited indemnity given by Eon and a
limited indemnity from the former shareholders of Shire Richwood Inc. ("SRI")
given at the time of our acquisition of SRI. We have already spent a substantial
amount of resources in managing these lawsuits and will continue to do so.
Through April 2000, we were named as a defendant in approximately 3,600
lawsuits and had been dismissed from approximately 500 of these cases. There are
approximately 2,400 additional cases pending dismissal as of April 25, 2000. In
only 136 cases pending was it alleged in the complaint or subsequent discovery
that the plaintiff had used our particular product and we have been dismissed
from 30 of these cases as well.
USE OF PROCEEDS
The selling shareholders who offer and sell their ordinary shares will
receive all net proceeds from the sale of the ordinary shares.Proceeds We will not receive any
proceeds from the sale by the
selling securityholders of the notes
or the ordinary shares or ADSs which
may be issued upon exchange of the
preference shares issued upon
conversion of the notes.
Trustee, Registrar, Transfer Agent,
Principal Paying Agent and
London Paying Agent The Bank of New York.
Risk Factors
Before deciding to purchase any notes or ordinary shares or ADSs which may
be issued upon exchange of the preference shares issued upon conversion of the
notes you should consider carefully all of the information in this prospectus
and, in particular, you should evaluate the specific risk factors set forth
under "Risk Factors" immediately following this summary.
-5-
RISK FACTORS
Before deciding to purchase any notes or the ordinary shares or ADSs which
may be issued upon exchange of the preference shares issued upon conversion of
the notes you should carefully consider the following factors, the risk factors
contained in our annual report on Form 10-K for the year ended December 31, 2000
and the risk factors related to BioChem contained in our proxy statement for the
extraordinary general meeting of shareholders dated March 1, 2001, incorporated
by reference into this prospectus, and other information in and incorporated
into this prospectus.
An active trading market for the notes may not develop.
We cannot assure you that an active trading market for the notes will
develop or as to the liquidity or sustainability of any such market, the ability
of holders to sell their notes or the price at which holders will be able to
sell their notes. Future trading prices of the notes will depend on many
factors, including, among other things, prevailing interest rates, the market
for similar securities, the price of our ordinary shares and ADSs, our
performance and other factors.
The price of our ordinary shares and ADSs is volatile.
The trading price of the ordinary shares.
-3-shares and ADSs issuable to you in
exchange for the preference shares issued to you upon conversion or redemption
of your notes may be subject to fluctuations in response to variations in our
operating results, regulatory developments, technological and manufacturing
evolution, global and regional economic conditions and other events or factors.
In addition, global stock markets have from time to time experienced significant
price and volume fluctuations, which may lead to a drop in the market price of
the ordinary shares and/or ADSs.
Factors which may add to the volatility of the price of the ordinary shares
and/or the ADSs include, among others, the following:
o actual or anticipated variations in our results and those of our
competitors;
o the introduction of competing pharmaceutical products into the markets
we serve;
o conditions or trends in the pharmaceuticals industry;
o announcements by us or our competitors of significant acquisitions or
divestitures;
o announcements of strategic partnerships or joint ventures entered into
by us or our competitors or their termination or other changes in our
business or operations, or those of our competitors;
o our capital commitments or downgrades in our credit rating;
o liquidity in the ordinary shares and/or the ADSs;
o sales of the ordinary shares and/or the ADSs; and
o investor sentiment towards the business sector in which we operate and
conditions in the capital markets generally.
Many of these factors are beyond our control. These factors may decrease
the market price of the ordinary shares and/or the ADSs, regardless of our
operating performance.
-6-
SELLING SHAREHOLDERSWe may enter into transactions that will not result in a change in control.
The change of control provisions may not protect you from transactions in
which we borrow a large amount of money but which do not result in a shift in
voting power or beneficial ownership large enough to trigger a change of
control. Such transactions may include a reorganization, restructuring, merger
or other similar transaction. The change of control provisions may not offer you
protection as transactions of that kind may not involve any shift in voting
power or beneficial ownership, or may not involve a shift large enough to
trigger a change of control.
The notes are unsecured obligations of the issuer.
The notes are senior unsecured indebtedness of the issuer. Our guarantee
relating to the notes ranks equally in right of payment with all of our existing
and future unsecured indebtedness. In addition, the guarantee will be
effectively subordinated to all of our and the issuer's future secured
indebtedness, to the extent of the value of the collateral securing such
indebtedness and is and will be effectively subordinated to all of the existing
and future indebtedness and other liabilities of our wholly-owned subsidiaries.
The indenture governing the notes does not limit the amount of additional
indebtedness which we or our subsidiaries can create, incur, assume or
guarantee.
You will have no shareholder rights prior to conversion of the notes.
As a holder of a note, you will not be a holder of our equity securities.
You will not have any voting rights, any right to receive dividends or other
distributions or any other rights with respect to our equity securities until
such time, if any, as you convert your notes into preference shares of the
issuer and such preference shares are exchanged for our ordinary shares or ADSs,
and you become a registered holder thereof.
-7-
USE OF PROCEEDS
We will not receive any of the proceeds from the sale by any of the selling
securityholders of the notes or the ordinary shares or ADSs which may be issued
upon exchange of the preference shares issued upon conversion of the notes.
PRICE RANGE OF COMMON EQUITY AND DIVIDEND POLICY
Ordinary Shares
Our ordinary shares are traded on the London Stock Exchange (the "LSE").
The following table presents the per share closing mid-market quotation for our
ordinary shares as quoted in the Daily Official List of the LSE for the quarters
indicated.
High (pound) Low (pound)
per ordinary per ordinary
Year Ended December 31, 1999 share share
First Quarter (pound)5.17 (pound)3.74
Second Quarter 5.28 3.96
Third Quarter 6.13 4.74
Fourth Quarter 7.34 5.59
Year Ended December 31, 2000
First Quarter (pound)14.28 (pound)5.98
Second Quarter 12.40 7.37
Third Quarter 13.69 11.35
Fourth Quarter 14.92 9.53
Year Ending December 31, 2001
First Quarter (pound)13.39 (pound)8.85
Second Quarter 12.94 10.01
Third Quarter 13.19 8.50
Fourth Quarter (through November 5, 2001) 11.12 8.87
The number of record holders of ordinary shares as of November 5, 2001 was
11,020 (105 U.S. holders), holding 479,367,095 ordinary shares in the aggregate
(125,323,942 shares held by U.S. holders in the aggregate). The total number of
ordinary shares includes 124,745,601 ordinary shares represented by ADSs of
which the depositary of the ADSs is the record holder. Since certain of the
ordinary shares are held by broker nominees, the number of record holders may
not be representative of the number of beneficial owners.
-8-
American Depositary Shares
Our ADSs, each representing three ordinary shares, evidenced by American
Depositary Receipts ("ADRs") issued by Morgan Guaranty Trust Company of New
York, as depositary, are quoted on the Nasdaq National Market. As of November 5,
2001, the proportion of ordinary shares represented by ADRs was approximately
26% of the ordinary shares outstanding.
The following table presents the high and low market quotations for the
ADSs quoted on the Nasdaq National Market for the quarters indicated.
High $ Low $
Year Ended December 31, 1999 per ADS per ADS
First Quarter $25.50 $19.13
Second Quarter 26.00 18.88
Third Quarter 29.31 23.75
Fourth Quarter 35.06 26.19
Year Ended December 31, 2000
First Quarter $67.19 $28.31
Second Quarter 59.75 33.19
Third Quarter 60.63 51.38
Fourth Quarter 65.00 42.06
Year Ending December 31, 2001
First Quarter $58.19 $39.13
Second Quarter 55.50 42.38
Third Quarter 57.20 36.30
Fourth Quarter (through November 5, 2001) 47.85 42.95
The number of record holders of ADSs as of November 5, 2001 was
approximately 426 (413 U.S. holders), holding 41,581,867 ADSs in the aggregate
(41,577,178 ADSs held by U.S. holders in the aggregate). Since certain of the
ADRs are held by broker nominees, the number of record holders may not be
representative of the number of beneficial owners.
Dividend Policy
Historically, Shire has not paid any dividends. Shire does not anticipate
paying any dividends on our ordinary shares, or indirectly on ADSs, in the
foreseeable future. As a matter of English law, Shire may pay dividends only out
of its distributable profits, which are accumulated realized profits under U.K.
GAAP, so far as not previously utilized by distribution or capitalization, less
accumulated realized losses, so far as not written off in a reduction or
reorganization of capital duly made. Future dividend policy will be dependent
upon Shire's distributable profits, our financial condition, the terms of any
then existing debt facilities and other relevant factors existing at that time.
-9-
Capitalization
The following table sets forth as of June 30, 2001: (1) the actual
consolidated capitalization of Shire and (2) the consolidated capitalization of
Shire on a pro forma basis giving effect to the issuance of the notes.
As reported Pro Forma
June 30, 2001 June 30, 2001
(in thousands of U.S. $)
Long term debt 8,575 408,575
Shareholders' equity:
Common stock, 5p par value: 800,000,000 shares
authorized; and 461,391,822 shares issued
and outstanding 35,518 35,518
Exchangeable shares: 10,038,008 shares issued
and outstanding 459,880 459,880
Additional paid-in capital 783,185 783,185
Accumulated deficit (97,531) (97,531)
Accumulated other comprehensive losses (90,307) (90,307)
---------- -----------
---------- -----------
Total Capitalization 1,090,745 1,090,745
---------- -----------
-10-
SELECTED FINANCIAL AND OPERATING DATA
The financial results as of December 31, 1999 and 2000 and for each of the
three years in the period ended December 31, 2000 have been restated to reflect
the combined results of Shire and BioChem. The financial results as of and for
the period ended December 31, 1998 also have been restated to reflect the
combined results of Shire and Roberts Pharmaceutical Corporation. The financial
results as of December 31, 1996 and 1997 and for each of the two years in the
period ended December 31, 1997 have been restated to reflect the combined
results of Shire and Roberts. Each of the BioChem and Roberts mergers was
accounted for as a pooling of interests. The summary historical data as of
December 31, 1999 and 2000 and for the years ended December 31, 1998, 1999 and
2000 is derived from actual audited results for such years. The unaudited
results as of December 31, 1996, 1997 and 1998 and for the years ended December
31, 1996 and 1997 are also included for comparative purposes. The selected
consolidated financial data for Shire should be read in conjunction with
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and with Shire's consolidated financial statements and related notes
included in Shire's Current Report on Form 8-K filed with the SEC on August 15,
2001 and incorporated by reference herein.
Year Ended
December 31,
1996 1997 1998 1999 2000
---- ---- ---- ---- ----
(Unaudited) (Unaudited)
(in thousands of U.S. $ except for share information and ratios)
Income Statement Data:
Revenues 289,675 298,656 435,905 537,253 671,110
Operating income (30,015) (35,661) 73,336 (36,654) 151,358
Income before income taxes (23,320) (24,957) 91,812 (13,590) 259,391
Net income from continuing (11,659) (28,037) 84,147 (35,253) 211,727
operations
Net income (11,103) (28,403) 82,040 (47,432) 211,727
Basic net income per ordinary share
continuing operations (3.2)c (6.5)c 17.5c (7.3)c 43.8c
net income (3.1)c (6.6)c 17.1c (9.8)c 43.8c
Basic net income per ADS
continuing operations (9.7)c (19.5)c 52.5c (21.9)c 131.4c
net income (9.2)c (19.8)c 51.3c (29.4)c 131.4c
Fully diluted net income per
ordinary share
continuing operations (3.2)c (6.5)c 17.0c (7.3)c 42.8c
net income (3.1)c (6.5)c 16.6c (9.8)c 42.8c
Fully diluted net income per ADS
continuing operations (9.7)c (19.5)c 51.0c (21.9)c 128.4c
net income (9.2)c (19.8)c 49.8c (29.4)c 128.4c
Weighted average ordinary shares
outstanding - basic 361,094,196 431,276,428 480,827,784 484,358,876 482,890,070
Weighted average ordinary shares
outstanding - fully diluted 361,094,196 431,276,428 494,149,715 488,138,499 494,691,805
Other Financial Data:
Earnings to fixed charges (1) (1) 14.17 0.01 16.27
---------------
(footnote appears on following page)
-11-
As at As at As at As at As at
----- ----- ----- ----- -----
December 31, December 31, December 31, December 31, December 31,
------------ ------------ ------------ ------------ ------------
1996 1997 1998 1999 2000
---- ---- ---- ---- ----
(Unaudited) (Unaudited) (Unaudited)
(in thousands of U.S. $)
Balance Sheet Data:
Current assets 530,271 495,360 445,972 520,023 695,853
Non-current assets 853,210 1,121,773 1,210,153 1,351,789 1,548,495
Current liabilities 115,191 141,196 99,770 233,818 227,850
Non-current liabilities 63,094 59,834 137,151 238,087 146,259
Minority interests 9,154 9,011 -- -- --
Shareholders' equity 665,771 911,732 973,232 879,886 1,174,386
(1) In calculating the ratio of earnings to fixed charges, earnings consist of
income before income taxes plus fixed charges. Fixed charges consist of
interest expense, amortization of debt issuance costs and one-third of
rental expense, deemed representative of that portion of rental expense
estimated to be attributable to interest. Earnings for the years ended
December 31, 1996 and 1997 were insufficient to cover fixed charges for
such periods by approximately $23.32 million and $24.96 million,
respectively.
-12-
DESCRIPTION OF THE NOTES
The notes were issued under a document called the "indenture." The
indenture is a contract between the issuer, us and The Bank of New York, who
acts as trustee. Because this section is a summary, it does not describe every
aspect of the notes. This summary is subject to and qualified in its entirety by
reference to all of the provisions of the indenture, including the definitions
of some terms that are used in the indenture and which we use in this section.
We describe the meaning for only the more important terms, and wherever we refer
to particular defined terms, those defined terms as they are used in the
indenture are incorporated by reference here. In this section, references to
"Shire," "we," "us" or "our" refer solely to Shire Pharmaceuticals Group plc and
not its subsidiaries, and references to the "issuer" refer solely to Shire
Finance Limited.
General
The notes are senior unsecured obligations of the issuer. The notes are
unsubordinated, which means that they rank equally among themselves and with all
of the issuer's other present and future senior and unsubordinated indebtedness,
except as required by mandatory provisions of law, and senior to all of its
other indebtedness, if any. The indenture does not limit the issuer's or our
ability to incur other indebtedness. The notes are limited to $400 million
aggregate principal amount. Payment of the full principal amount of the notes is
due on August 21, 2011, to the extent the notes are not converted, redeemed or
repurchased prior to that date.
The notes bear interest at the annual rate shown on the front cover of this
prospectus. The issuer will pay interest semi-annually on February 21 and August
21 of each year, beginning February 21, 2002, until the principal is paid or
made available for payment or the notes are converted or redeemed in accordance
with their terms. Interest will be paid to the holders of record of the notes at
the close of business on the February 6 or August 6, as applicable, preceding
the relevant interest payment date. Interest payable in respect of any period
which is not a full interest period will be calculated on the basis of a 360-day
year consisting of 12 months of 30 days each and, in the case of an incomplete
month, the number of days elapsed.
The notes are represented by global notes in registered form without
interest coupons. Notes that were sold in transactions outside the United States
in compliance with Regulation S under the U.S. Securities Act of 1933, as
amended (the "Securities Act"), are represented by interests in the "Regulation
S global note." We refer to these notes as "Regulation S notes." Notes which
were sold pursuant to Rule 144A under the Securities Act ("Rule 144A") are
represented by interests in the "Rule 144A global note." We refer to these notes
as the "Rule 144A notes." Any purchaser of notes pursuant to this prospectus
will receive a beneficial interest in an unrestricted global note, which we
refer to as the "registered resale global note." The Regulation S global note,
the Rule 144A global note and the registered resale global note are referred to
together in this section as the "global notes." Interests and transfers of
interests in the global notes are shown on and effected only through the
book-entry systems operated by The Depository Trust Company, or DTC, Euroclear
or Clearstream and their respective participants.
You may convert the notes into preference shares of the issuer, which will
then be exchanged for our ordinary shares or ADSs representing our ordinary
shares in accordance with the issuer's memorandum and articles of association at
any time before the close of business on August 14, 2011, unless the notes have
been previously converted, redeemed or repurchased. Until either (a) the note
being converted has been transferred pursuant to an effective registration
statement or (b) the note is not otherwise a "restricted security" within the
meaning of Rule 144(a)(3) under the Securities Act, however, holders may only
exchange the preference shares for our ordinary shares and not ADSs. At the
issuer's option, the issuer may procure the delivery to you of cash in U.S.
dollars upon conversion and exchange rather than ordinary shares or ADSs, as
described below under "--Conversion and Exchange Rights--Cash-Out Option." The
exchange ratio may be adjusted upon the occurrence of certain events which
change the number of our ordinary shares outstanding or provide for
distributions of our ordinary shares, as described below under "--Conversion and
Exchange Rights--Adjustments to the Exchange Ratio."
-13-
The issuer may redeem the notes at its option at any time on or after
August 21, 2004, in whole or in part, at par plus accrued and unpaid interest to
the redemption date, if the conditions described below under "--Optional
Redemption by the Issuer" are met. If there is a change in control of Shire, you
may have the right to require the issuer to redeem your notes at a redemption
price equal to 101% of the principal amount of the notes. In addition, you will
have the right to require the issuer to redeem your notes at par on August 21,
2004, 2006 and 2008 as described below under "--Redemption at Option of
Holders--Redemption at Option of Holders on Selected Dates." In the event that
you elect for notes to be redeemed prior to final maturity, the issuer may at
its option instead choose to convert the relevant notes into its preference
shares, which will then be exchanged by the issuer into our ordinary shares or,
at your option, ADSs as described below under "--Redemption at Option of
Holders--Redemption at Option of Holders upon a Change in Control" and
"--Redemption at Option of Holders on Selected Dates."
The issuer will pay you any cash amounts to which you may be entitled under
the terms of the notes in respect of the principal of and any accrued interest
on the notes at maturity (including upon the issuer's repurchase or redemption
of the notes) in U.S. dollars.
We fully and unconditionally guarantee payments of principal and interest
on the notes and, following conversion into preference shares of the issuer,
payments in respect of the preference shares of dividends and liquidation
preference upon any liquidation of the issuer. We have agreed not to register 21,214,628alter our
obligation to the issuer to issue our ordinary shares ownedin order that the issuer
might meet its exchange obligations under the terms of its preference shares,
and we have agreed to ensure the issuer's performance of its conversion and
exchange obligations under the notes and its memorandum and articles of
association. We discuss these guarantees and agreements in more detail below
under "--The Guarantees."
The principal corporate trust office of the trustee in the City of New York
is designated as the principal paying agent. We may at any time designate
additional paying agents or rescind the designation of any paying agents or
approve a change in the office through which any paying agent acts. The trustee
has been appointed as the London paying agent. For so long as any of the notes
are listed on the LSE, we will maintain a paying agent in the United Kingdom.
So long as the notes are represented by global notes, payment of interest
on and, if applicable, principal of the notes will be made in immediately
available funds.
Obligations to Direct Holders
The issuer's obligations under the notes and our obligations under the
guarantees, as well as the obligations of the trustee and those of any third
parties employed by the selling shareholders.issuer, us or the trustee, run only to persons who are
registered as holders of notes. Neither we nor the issuer has obligations to you
if you hold in street name or other indirect means, either because you choose to
hold notes in that manner or because the notes are issued in the form of global
notes as described below. For example, once payment is made to the person with
whom the global note is deposited, neither we nor the issuer has any further
responsibility for the payment even if that holder is legally required to pass
the payment along to you as a street name customer but does not do so.
In the remainder of this description "you" means direct holders and not
street name or other indirect holders of notes.
Form, Exchange and Transfer
The notes are each represented by global notes in registered form, without
coupons. The global notes are issued in denominations that in the aggregate
equal the outstanding principal amount of notes represented thereby. The notes
have denominations of $1,000 or even multiples of $1,000. The Rule 144A global
note and the registered
-14-
resale global note are deposited with a custodian for and registered in the name
of Cede & Co., as nominee of DTC. The Regulation S global note is deposited
with, and registered in the name of a nominee for, a common depositary for
Euroclear and Clearstream.
You may have your notes broken into more notes of smaller denominations or
combined into fewer notes of larger denominations, as long as the total
principal amount is not changed.
If definitive registered notes are issued in the special situations
described under "--Special Situations in Which a Global Note Will Be Terminated"
below, you may exchange or transfer your notes at the office of the trustee. The
trustee acts as our agent for registering notes in the names of holders and
transferring registered notes. We may change this appointment to another entity
or perform the service ourselves. The entity performing the role of maintaining
the list of registered holders is called the "security registrar." It will also
register transfers of the registered notes. You may not, however, exchange
registered notes for bearer notes.
You will not be required to pay a service charge to transfer or exchange
notes, but you may be required to pay any tax or other governmental charge
associated with the exchange or transfer. The transfer or exchange of registered
notes will only be made if the security registrar is satisfied with your proof
of ownership.
We may designate additional transfer agents. We may cancel the designation
of any particular transfer agent. We may also approve a change in the office
through which any transfer agent acts.
Special Situations in Which a Global Note Will Be Terminated
In a few special situations described below, a global note will terminate
and interests in it will be exchanged for physical certificates representing
definitive registered notes. After that exchange, the choice of whether to hold
notes directly or in street name will be up to the investor. Investors must
consult their own bank or brokers to find out how to have their interests in
notes transferred to their own name so that they will be direct holders.
The special situations for termination of a global note are:
In the case of the Rule 144A global note or the registered resale global
note, when DTC notifies the trustee that it is unwilling, unable or no longer
qualified to continue holding the global note or notes, and we do not appoint a
successor within 120 days.
In the case of the Regulation S global note, when either Euroclear or
Clearstream is closed for business for a continuous period of 14 days, other
than public holidays, or permanently ceases business or announces an intention
to do so.
When the issuer elects to exchange the global notes representing such notes
for physical certificates representing such notes in registered form.
When an event of default on the notes has occurred and has not been cured,
if requested by the holder of a book-entry interest in the notes. Defaults on
notes are discussed below under "--Events of Default."
In addition, if instructions have been given to transfer a beneficial
interest in one global note to a person who would otherwise take delivery in the
form of an interest in another global note, and such other global note has
previously been exchanged for definitive registered notes, then the transferee
will receive its interest in the form of definitive registered notes.
-15-
No definitive notes in bearer form will be issued. Definitive notes issued
in exchange for book-entry securities will be issued in registered form only,
without coupons. They will be registered in the name or names instructed by the
registrar based on the instructions of DTC, Euroclear and Clearstream.
Payment and Paying Agents
The issuer will pay interest to you if you are a direct holder listed in
the trustee's records at the close of business on the February 6 or August 6, as
applicable, in advance of each interest payment date, even if you no longer own
the security on the interest payment date. That particular day is called the
"regular record date." The issuer will pay interest, principal and any other
money due on global notes to the registered holder thereof by wire transfer of
same-day funds. For a discussion of payments with respect to book-entry
securities issued in respect of global notes, see "--Arrangements Relating to
Notes in Global Form--Payments" below. Payments on definitive registered notes,
if any, will be made at the corporate trust office of the trustee in New York
City. That office is currently located at 101 Barclay Street, Floor 21 West, New
York, New York 10286. You must make arrangements to have your payments picked up
at or wired from that office. The issuer may also choose to pay interest on
definitive registered notes by mailing checks.
Street name and other indirect holders should consult their banks or
brokers for information on how they will receive payments.
We may also arrange for additional payment offices, and may cancel or
change these offices, including our use of the trustee's corporate trust office
as a payment office. These offices are called "paying agents." The issuer may
also choose to act as its own paying agent. We must notify you of changes in the
paying agents for the notes that you hold.
Conversion and Exchange Rights
You may, at your option, convert any portion of the principal amount of a
note in an even multiple of $1,000 into fully paid 2% exchangeable redeemable
preference shares of the issuer at any time before the close of business on the
maturity date, unless the note has been previously converted, redeemed or
repurchased. Each $1,000 principal amount of notes may be converted into one
preference share, which will be issued at an issue price of $1,000 each. Subject
to the issuer's option to procure the exchange of the preference shares for cash
as described below under "Conversion and Exchange Rights--Cash-Out Option," upon
conversion the issuer will procure the issue of our ordinary shares or, at your
option, ADSs representing our ordinary shares in exchange for the preference
shares, at an exchange ratio equal to 49.6175 ordinary shares per preference
share (or 16.5392 ADSs per preference share). This exchange ratio is based on an
effective exchange price of $20.154 per ordinary share (or (pound)14.107 per
ordinary share, converted into U.S. dollars based on the $/(pound) closing
buying rate of 1.4289 on August 14, 2001) and $60.4625 per ADS. The exchange
ratio is subject to adjustment as described below. Until either (a) the note
being converted has been transferred pursuant to an effective registration
statement or (b) the note is not otherwise a "restricted security" within the
meaning of Rule 144(a)(3) under the Securities Act, however, you may only
exchange preference shares for our ordinary shares and not ADSs. Your right to
convert a note called or delivered for redemption will terminate at the close of
business on the business day (as defined in the indenture) immediately preceding
the redemption date for that note, unless the issuer and we default in making
the payment due upon redemption.
You can convert a note by delivering the note at the corporate trust office
of the trustee accompanied by a duly signed and completed notice of conversion
and exchange, a copy of which may be obtained from the trustee. If you prefer to
receive ADSs upon exchange, you must so specify in your conversion and exchange
notice. In the case of a global note, DTC will effect the conversion upon notice
from the holder of a book-entry security in accordance with DTC's customary
procedures. The conversion and exchange date will be the date on which the note
and the duly signed and completed notice of conversion and exchange are so
delivered. As promptly as practicable on or
-16-
after the conversion and exchange date, and in any event within 14 days of such
date, the issuer will cause to be issued or delivered to the trustee a
certificate or certificates for the number of full ordinary shares or ADSs
issuable upon exchange, together with a cash payment instead of any fraction of
an ordinary share or ADS. The certificates will be sent by the trustee to the
conversion agent for delivery to you. Our ordinary shares issuable upon
conversion of the notes and exchange of the preference shares will be fully paid
and nonassessable and will also rank equally with our other ordinary shares
outstanding from time to time. If the deposit agreement with respect to the ADSs
is terminated for any reason and no successor deposit agreement is established,
it will no longer be possible for us to deliver ADSs upon exchange.
If you surrender a note for conversion and exchange on a date that is not
an interest payment date, you will not be entitled to receive any interest for
the period from the preceding interest payment date to the date of conversion
and exchange, except as described below. However, if you are a holder of a
registered note on a regular record date, including a note surrendered for
conversion and exchange after the regular record date, you will receive the
interest payable on that note on the next succeeding interest payment date.
Accordingly, any notes surrendered for conversion and exchange during the period
from the close of business on a regular record date to the opening of business
on the next succeeding interest payment date must be accompanied by payment of
an amount equal to the interest payable on such interest payment date on the
principal amount of notes being surrendered for conversion. However, you will
not be required to make that payment if you are converting a note, or a portion
of a note, that the issuer has called for redemption, or that you are entitled
to require the issuer to redeem, if your conversion and exchange right would
terminate because of the redemption between the regular record date and the
close of business on the next succeeding interest payment date.
No other payment or adjustment for interest, or for any dividends on our
ordinary shares, will be made upon conversion and exchange. If you receive our
ordinary shares or ADSs upon conversion and exchange, you will not be entitled
to receive any dividends payable to holders of our ordinary shares as of any
record date before the close of business on the conversion and exchange date. If
the issuer does not exercise its option to procure the exchange of your
preference shares for cash, as described below under "--Cash-Out Option," you
will be treated as if you were acquireda holder of our ordinary shares as of the
conversion and exchange date and therefore entitled to receive, in addition to
the ordinary shares or ADSs, cash consideration equal to any dividends payable
to holders of our ordinary shares as of any record date between the conversion
and exchange date and the date on which the ordinary shares are issued to you.
You will not be entitled to exercise any voting rights of such ordinary shares
or ADSs if the relevant record date falls after the conversion and exchange date
but before the date on which the ordinary shares or ADSs are issued to you.
We will not issue fractional shares or ADSs upon conversion and exchange.
Instead, we will pay an amount in cash based on the market price of our ordinary
shares at the close of business on the conversion and exchange date.
Except as provided below, if you deliver a note for conversion and
exchange, you will not in any circumstances be required to pay any U.K. transfer
taxes or duties in respect of the issue or delivery of the preference shares on
conversion of the notes, the subsequent transfer of the preference shares to us
or the issue of our ordinary shares or ADSs in exchange for the preference
shares. Instead, we will hold you harmless against any U.K. stamp duty or stamp
duty reserve tax liability you may be required to pay on conversion and
exchange. We will not pay any tax or duty, however, that may be payable in
respect of any transfer involved in the issue or delivery of our ordinary shares
or ADSs in a name other than that of the holder of the note. We will not issue
or deliver certificates representing our ordinary shares or ADSs unless the
person to whom the ordinary shares or ADSs are being issued or delivered has
paid to us the amount of any such tax or duty or has established to our
satisfaction that no such tax or duty is payable.
Any of our ordinary shares issued on exchange will be fully paid and will
rank equally in all respects with our fully paid and issued ordinary shares on
the conversion and exchange date, except that the issued ordinary
-17-
shares will not be entitled to any dividend or other distribution declared or
paid on our ordinary shares with respect to a record date prior to the
conversion and exchange date.
Our ordinary shares (unless they are to be represented by Robert A. VukovichADSs issued by
Morgan Guaranty Trust Company, the ADS depositary) will not be issued to:
o DTC, Euroclear, Clearstream, the Depositary and Yamanouchi Group Holdings,Clearing Centre or any
of their nominees or agents or any other person providing a clearance
service within Section 96 of the Finance Act 1986 of the United
Kingdom or any of their nominees or agents; or
o any person whose business includes issuing depositary receipts within
Section 93 of the Finance Act 1986 of the United Kingdom, or any
nominee or agent of such a person,
in each case at any time before the "abolition day" as defined in Section 111(1)
of the Finance Act 1990 of the United Kingdom.
Street name and other indirect holders should consult their banks or
brokers for information on how to direct the conversion of notes into preference
shares and the exchange of preference shares into our ordinary shares or ADSs.
Adjustments to the Exchange Ratio
The issuer's preference shares issued upon conversion of the notes will be,
in accordance with the issuer's memorandum and articles of association,
exchanged by the issuer for our ordinary shares or ADSs, or, as described below,
at the issuer's option for cash. The following is a summary of the issuer's
memorandum and articles of association relating to adjustments that may be made
to the exchange ratio. You should refer to "Description of the Preference
Shares" for more provisions of the issuer's memorandum and articles of
association as they relate to the preference shares. The exchange ratio is
subject to adjustment upon the occurrence of any of the events described below:
(1) If there is a change in the nominal value of our ordinary shares as a
result of consolidation or subdivision of our ordinary shares, the
exchange ratio will be adjusted by multiplying the exchange ratio in
force immediately before such change by the following fraction:
A
-
B
where:
A is the nominal amount of one ordinary share immediately before such
change; and
B is the nominal amount of one ordinary share immediately after such
change.
This adjustment will become effective on the date the change in nominal
value takes effect.
(2) If we pay a dividend or other distribution payable in our ordinary
shares, that is, we issue fully paid ordinary shares to our
shareholders by way of capitalization of profits or reserves (including
any share premium account or capital redemption reserve), the exchange
ratio will be adjusted by multiplying the exchange ratio in force
immediately before we pay the stock dividend by the following fraction:
-18-
A
-
B
where:
A is the aggregate nominal amount of our issued ordinary shares
immediately after such issue; and
B is the aggregate nominal amount of our issued ordinary shares
immediately before such issue.
This adjustment will become effective on the date of issue of such ordinary
shares.
This adjustment will not be made if we pay a scrip dividend, that is, a
dividend or other distribution in our ordinary shares instead of all or any part
of a cash dividend which our shareholders would otherwise have received. If,
however, we pay a scrip dividend where the market value of the ordinary shares
issued exceeds the amount of the cash dividend, or the relevant portion of the
cash dividend if the scrip dividend is offered in place of only part of the cash
dividend, then the exchange ratio will be adjusted by multiplying the exchange
ratio in force immediately before we pay the stock dividend by the following
fraction:
A + B
-----
A + C
where:
A is the aggregate nominal amount of our issued ordinary shares
immediately before such issue;
B is the aggregate nominal amount of our ordinary shares issued by way
of scrip dividend; and
C is the aggregate nominal amount of ordinary shares issued by way of
scrip dividend multiplied by a fraction of which (x) the numerator is
the amount of the cash dividend per share, or the part of such cash
dividend in respect of which the scrip dividend applies, and (y) the
denominator is the amount per share used for the purpose of
determining the number of ordinary shares to be issued by way of scrip
dividend.
This adjustment will become effective on the date of issue of such ordinary
shares.
As used in this adjustment, "market value" means the price or value of the
ordinary shares stated in, or calculated in accordance with the provisions of
and at the time of, any circular or other document issued by us relating to the
scrip dividend.
(3) If we pay or make any capital distribution (as defined below) to our
shareholders, the exchange ratio will be adjusted by multiplying the
exchange ratio in force immediately before such extraordinary dividend
by the following fraction:
A
-----
A - B
where:
A is the current market price (as defined below) of one ordinary
share on the dealing day immediately preceding the date on
which the ordinary shares are traded on the LSE ex-capital
distribution; and
-19-
B is the portion of the capital distribution attributable to one
ordinary share.
This adjustment will become effective on the date on which our ordinary
shares are first traded on the LSE ex-extraordinary dividend or on which the
protected share repurchase is actually made, as the case may be.
As used in this section, "current market price" means the average of the
closing bid and offer quotations per ordinary share published in the LSE Daily
Official List for the five consecutive dealing days ending on the dealing day
immediately preceding the date in question, subject to adjustment to take into
account dividend payments.
Any day on which the LSE is open for business is a "dealing day."
"Capital distribution" means the premium attributable to an extraordinary
dividend or a protected share repurchase.
An "extraordinary dividend" is any dividend or distribution on our ordinary
shares, whether in cash or in kind, where the aggregate amount of the dividend
or distribution, without taking into account any tax credit that may arise in
respect of the dividend or distribution, when added to the aggregate amount of
all other dividends or distributions paid or made in the preceding 12 months
other than dividends or distributions to the extent an adjustment was made
pursuant to paragraph (2) above, exceeds 5% of our market capitalization on the
dealing day immediately preceding the payment date of the dividend or
distribution in question. Extraordinary dividends do not include any dividend or
distribution to the extent an adjustment pursuant to paragraph (2) above is
applicable.
The amount of the premium attributable to an extraordinary dividend is the
amount by which the extraordinary dividend exceeds 5% of our market
capitalization on the dealing day immediately preceding the payment date of the
dividend or distribution in question. For purposes of determining whether an
adjustment is appropriate under this paragraph (3), our "market capitalization"
will be calculated as if we had already issued all ordinary shares issuable upon
the exchange of the exchangeable shares issued by Shire Acquisition Inc. in
connection with the merger between us and BioChem.
A "protected share repurchase" occurs when we purchase our ordinary shares
on the market on any one day at a weighted average price, before expenses, that
exceeds by more than 5% the average price quoted for our ordinary shares on the
LSE on the five dealing days before we make the purchase. If we announce our
intention to purchase ordinary shares at some future date at a specified price,
then a protected share repurchase occurs when the announced purchase price
exceeds by more than 5% the average price quoted for our ordinary shares on the
LSE on the five dealing days preceding the announcement.
The amount of the premium attributable to a protected share repurchase is
the amount by which the repurchase amount or announced repurchase amount, as the
case may be, exceeds 5% of the average price quoted for our ordinary shares on
the LSE on the five dealing days before we make the purchase or announcement, as
the case may be.
(4) If we issue ordinary shares to our shareholders as a class by way of
rights, or issue or grant to our shareholders as a class by way of
rights, options, warrants or other rights to subscribe for or purchase
any ordinary shares, in each case at a price per ordinary share which
is less than 95% of the current market price per ordinary share on the
dealing day immediately preceding the date of the announcement of the
terms of the issue or grant of such ordinary shares, options, warrants
or other rights, the exchange ratio will be adjusted by multiplying the
exchange ratio in force immediately before such issue or grant by the
following fraction:
-20-
A + B
-----
A + C
where:
A is the number of ordinary shares in issue immediately before we
announce the issue or grant;
B is the number of ordinary shares issued or, as the case may be,
included in the grant; and
C is the number of ordinary shares which could have been purchased, at
the current market price per ordinary share indicated above, for the
aggregate amount (if any) payable for the new ordinary shares issued
by way of rights, or for the options or warrants or other rights
issued by way of rights and for the total number of ordinary shares
comprised in such options, warrants or other rights.
This adjustment will become effective on the first date on which the
ordinary shares are traded ex-rights, ex-options or ex-warrants, as the case may
be, on the LSE.
(5) If we issue any securities to our shareholders as a class, not
including ordinary shares or options, warrants or other rights to
subscribe for or purchase any ordinary shares, by way of rights, of if
we grant to our shareholders as a class by way of rights any options,
warrants or other rights to subscribe for or purchase any securities
other than ordinary shares or options, warrants or other rights to
subscribe for or purchase ordinary shares, the exchange ratio will be
adjusted by multiplying the exchange ratio in force immediately prior
to such issue or grant by the following fraction:
A
-----
A - B
where:
A is the current market price of one ordinary share on the dealing day
immediately preceding the date on which we publicly announce the terms
of such issue or grant; and
B is the fair market value on the date of such announcement of the
portion of the rights attributable to one ordinary share. The fair
market value of the offer will be determined in good faith by an
independent investment bank of international repute that we select.
This adjustment will become effective on the first date on which the
ordinary shares are traded ex-rights, ex-options or ex-warrants, as the case may
be, on the LSE.
(6) If we issue or grant wholly for cash, other than as mentioned in (4)
above, any ordinary shares or any options, warrants or other rights to
subscribe for or purchase any ordinary shares, in each case at a price
per ordinary share which is less than 95% of the current market price
per ordinary share on the dealing day immediately preceding the date we
announce the terms of such issue or grant, the exchange ratio will be
adjusted by multiplying the exchange ratio in force immediately prior
to such issue or grant by the following fraction:
A + B
-----
A + C
where:
-21-
A is the number of ordinary shares in issue immediately before we issue
such ordinary shares or grant such options, warrants or rights;
B is the maximum number of ordinary shares to be issued pursuant to such
issue of additional ordinary shares or upon exercise of such options,
warrants or rights; and
C is the number of ordinary shares which the aggregate consideration (if
any) receivable for the issue of the additional ordinary shares, or,
as the case may be, for the ordinary shares to be issued upon the
exercise of any such options, warrants or rights, would purchase at
the current market price per ordinary share indicated above.
This adjustment does not apply to ordinary shares issued on the exchange of
the preference shares or on the exercise of any other rights of conversion into,
or exchange or subscription for, ordinary shares.
This adjustment will become effective on the date we issue such additional
ordinary shares or, as the case may be, we grant such options, warrants or
rights.
(7) If we or any of our subsidiaries issue any securities (other than the
notes or the preference shares) wholly for cash or for no
consideration, otherwise than as mentioned in paragraphs (4), (5) or
(6) above, and these securities carry rights of conversion into, or
exchange or subscription for, our ordinary shares or grant any such
rights in respect of existing securities, or if we or any of our
subsidiaries issue any securities which by their terms might be
redesignated as ordinary shares, and the consideration per ordinary
share receivable by us upon conversion, exchange, subscription or
redesignation is less than 95% of the current market price per ordinary
share on the dealing day immediately preceding the date we announce the
terms of issue of such securities or the terms of such grant, the
exchange ratio will be adjusted by multiplying the exchange ratio in
force immediately prior to such issue or grant by the following
fraction:
A + B
-----
A + C
where:
A is the number of ordinary shares in issue immediately before such
issue or grant (but if we have already issued the ordinary shares into
which the relevant securities may be converted or for which they may
be exchanged or provide subscription rights, then less the number of
such ordinary shares);
B is the maximum number of ordinary shares that may be issued upon
conversion or exchange of such securities or upon the exercise of such
rights of subscription attached to such securities at the initial
conversion, exchange or subscription price or rate or, as the case may
be, the maximum number of ordinary shares to be issued or to arise
from any such redesignation; and
C is the number of ordinary shares that could be purchased at the
current market price per ordinary share indicated above for the
aggregate consideration (if any) receivable for the ordinary shares to
be issued upon conversion or exchange or upon exercise of the right of
subscription attached to such securities or, as the case may be, for
the ordinary shares to be issued or to arise from any such
redesignation.
This adjustment will become effective on the date of issue or grant of the
securities in question.
-22-
(8) If there is any modification of the rights of conversion, exchange or
subscription attaching to any securities described in paragraph (7)
above (other than in accordance with the terms (including terms as to
adjustment) applicable to such securities) so that following such
modification the consideration per ordinary share receivable by us has
been reduced and is less than 95% of the current market price per
ordinary share on the dealing day immediately preceding the date of
announcement of the proposals for such a modification, the exchange
ratio will be adjusted by multiplying the exchange ratio in force
immediately prior to such modification by the following fraction:
A + B
-----
A + C
where:
A is the number of ordinary shares in issue immediately before such
modification (but if we have already issued the ordinary shares into
which the relevant securities may be converted or for which they may
be exchanged or provide subscription rights, then less the number of
such ordinary shares);
B is the maximum number of ordinary shares to be issued upon conversion
or exchange of such securities or upon the exercise of such rights of
subscription attached to such securities at the modified conversion,
exchange or subscription price or rate, but giving credit as
appropriate for any previous adjustment under this paragraph (8) or
under paragraph (7) above; and
C is the number of ordinary shares which the aggregate consideration (if
any) receivable by us for the ordinary shares to be issued upon
conversion or exchange or upon exercise of the right of subscription
attached to the modified securities would purchase at the current
market price per ordinary share indicated above.
This adjustment will become effective on the date of modification of the
rights of conversion, exchange or subscription attaching to such securities.
(9) If we or any of our subsidiaries offer any securities and our
shareholders as a class are entitled to participate in arrangements
whereby such securities may be acquired by them, the exchange ratio
will be adjusted by multiplying the exchange ratio in force immediately
before we make such offer by the following fraction:
A
------
A -- B
where:
A is the current market price of one ordinary share on the dealing day
immediately preceding the date on which the terms of such offer are
publicly announced; and
B is the fair market value on the date of such announcement of the
portion of the relevant offer attributable to one ordinary share. The
fair market value of the offer will be determined in good faith by an
independent investment bank of international repute that we select.
This adjustment will become effective on the first date on which the
ordinary shares trade ex-rights on the LSE.
-23-
This adjustment will not apply when the exchange ratio is adjusted under
paragraph (4) or (5) above or would be so adjusted if the relevant issue or
grant were at less than 95% of the current market price per ordinary share on
the relevant dealing day.
(10) If any adjustment has been made pursuant to paragraph (4) or (6) above,
and any such rights, options, warrants or other rights to subscribe for
or purchase any ordinary shares have lapsed or expired or are otherwise
no longer exercisable and we have not issued all of the ordinary shares
in respect of such lapsed, expired or unexercisable rights, options,
warrants or other rights to subscribe for or purchase any ordinary
shares, the exchange ratio will be readjusted to the exchange ratio
which would otherwise be in effect had the adjustment made upon the
issuance of such rights, options, warrants or other rights to subscribe
for or purchase any ordinary shares been made on the basis of delivery
of only the number of ordinary shares actually delivered.
This adjustment will become effective on the date on which the rights,
options, warrants or other rights to subscribe for or purchase any ordinary
shares lapsed, expired or otherwise became no longer exercisable.
No adjustment of the exchange ratio pursuant to any of paragraphs (1)
through (10) above will be required to be made:
o until the cumulative adjustments amount to 1.0% or more of the
exchange ratio;
o if, as a result, on conversion and exchange ordinary shares would be
issued at a discount to their par value;
o to the extent ordinary shares or other securities are issued, allotted
or granted to employees, including directors and executive officers,
of Shire or any of its subsidiaries pursuant to any employees' share
scheme or option plan;
o upon the conversion or exchange of convertible or exchangeable
securities outstanding as of the date of this prospectus, including:
- the exchangeable shares of Shire Acquisition Inc.; and
- our unsecured convertible zero coupon loan note due to Arenol
Corporation; or
o upon the exchange of any remaining shares of Roberts Pharmaceutical Corporationfor our ordinary
shares.
We will compute any adjustments to the exchange ratio and give notice to
the holders of any such adjustments.
If (a) we merge or consolidate with another person or sell or transfer all
or substantially all of our assets, in Decembereach case which results in a change of
1999. Thecontrol (as defined below), or (b) we participate in a statutory merger that
results in a reclassification, conversion, exchange or cancellation of our
ordinary shares, then the preference shares will, without the consent of the
holder of any note or preference share, become exchangeable only for the kind
and amount of securities, cash and other property that a holder of the number of
our ordinary shares into which the preference shares were exchangeable
immediately prior to the merger, consolidation, sale or transfer could have
received at the time of such merger, consolidation, sale or transfer. This
calculation will be made based on the assumption that the holder of our ordinary
shares failed to exercise any rights of election that the holder may have to
select a particular type of consideration. The adjustment will not be made for a
merger that does not result in any reclassification, conversion, exchange or
cancellation of our ordinary shares.
-24-
We may, from time to time, increase the exchange ratio by any amount for
any period of at least 20 days if our board of directors has determined that
such increase would be in our best interests. If our board of directors makes
such a determination, it will be conclusive. We will give holders of notes at
least 15 days' notice of such an increase in the exchange ratio.
Cash-Out Option
If you exercise your conversion and exchange right, the issuer will have
the right, at its option, to procure the exchange of your preference shares for
cash in U.S. dollars rather than for our ordinary shares or ADSs. The issuer
will calculate this cash payment based on the average LSE volume-weighted
average price, as seen on Bloomberg Professional Service, of our ordinary shares
on the fourth through eighth business days following the conversion and exchange
date (each such price converted into U.S. dollars at the $/(pound) noon buying
rate in New York prevailing on such date). The issuer will inform you within
three business days after the conversion and exchange date of its election to
procure the payment to you of cash rather than procure the issue to you of our
ordinary shares or ADSs, and will procure the payment to you not later than 14
days after the conversion and exchange date. If this payment is not made to you
by the 14th day after the conversion and exchange date, you may again elect to
receive our ordinary shares or ADSs in exchange for your preference shares in
lieu of cash.
Redemption at Option of Holders
Redemption at Option of Holders upon a Change in Control
If a change in control (as defined below) occurs, you will have the right,
at your option, to require the issuer to redeem all of your notes not previously
called for redemption, or any portion of the principal amount of your notes that
is equal to $5,000 or any greater even multiple of $1,000. The price the issuer
is required to pay will be 101% of the principal amount of the notes, plus
accrued interest to the redemption date.
At the issuer's option, instead of redeeming the notes in respect of which
you have exercised your right to require redemption, the issuer may elect to
convert such notes in whole or in part into preference shares, exchangeable into
our ordinary shares (or, at your option as specified in your notice of exercise
described below, ADSs, if an effective registration statement is in effect with
respect to such ADSs) at a special exchange ratio equal to 101% of the principal
amount of the notes being converted divided by the market price of our ordinary
shares valued at 95% of the average of the LSE volume-weighted average prices,
as seen on Bloomberg Professional Service, of our ordinary shares for the five
trading days immediately following the date the issuer informs you of its
election to convert the notes into preference shares rather than redeem the
notes (each such price converted into U.S. dollars at the $/(pound) noon buying
rate in New York prevailing on such date). The issuer may only choose to convert
notes into preference shares under these circumstances if, following the change
in control, our ordinary shares continue to be listed for trading on the LSE, if
the public float of our ordinary shares at such time corresponds to at least 50%
of our outstanding ordinary share capital, and if we satisfy other conditions
provided in the indenture.
Within 30 days after the occurrence of a change in control, the issuer is
obligated to give you notice of the change in control and of the redemption
right arising as a result of the change in control. The issuer must also deliver
a copy of this notice to the trustee. To exercise your redemption right, you
must deliver to the trustee, on or before the 30th day after the date of the
notice to you, irrevocable written notice of your exercise of your redemption
right, together with the notes with respect to which that right is being
exercised. The notice should include your election to receive either our
ordinary shares or ADSs in the event the issuer elects not to redeem the notes
but to convert them into preference shares instead. The issuer will inform you
of its election to convert the notes into preference shares within two business
days after the last date you may give notice of your decision to exercise your
redemption right. The issuer is required to effect the redemption or conversion
on the date that is 44 days after the date of the change of control notice.
-25-
A "change in control" will be deemed to have occurred at any time after the
notes are originally issued that any of the following occurs:
(1) Any person, including any syndicate or group deemed to be a "person"
under Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, acquires beneficial ownership, directly or indirectly, through
a purchase, merger or other acquisition transaction or series of
transactions, of shares of our capital stock entitling that person to
exercise more than 50% of the total voting power of all shares of our
capital stock entitled to vote generally in elections of directors;
however, any acquisition by us, any subsidiary of ours or any employee
benefit plan of ours will not trigger this provision.
(2) Either:
o an offer is made to all or practicably all our ordinary shareholders
or all or practicably all such shareholders other than the offeror
and/or any associate of the offeror (as defined in Section 430E(4) of
the Companies Act 1985 of the United Kingdom), to acquire the whole or
any part of our issued ordinary share capital; or
o a scheme is proposed with regard to such acquisition,
and we become aware that the right to cast more than 50% of the votes
which may ordinarily be cast at a general meeting of shareholders has
or will become unconditionally vested in the offeror and/or its
associates. No change of control will be deemed to have occurred under
this definition (2), however, if the holders of 50% or more of the
total voting power of our capital stock entitled to vote generally in
elections of directors prior to the offer have, directly or indirectly,
50% or more of the total voting power of all shares of capital stock of
the offeror or acquiror entitled to vote generally in elections of
directors of the offeror or acquiror following the consummation of the
acquisition.
(3) We convey, transfer, sell, lease or otherwise dispose of all or
substantially all of our assets to another person.
For purposes of these provisions:
o whether a person is a "beneficial owner" will be determined in
accordance with Rule 13d-3 under the Exchange Act; and
o "person" includes any syndicate or group that would be deemed to be a
"person" under Section 13(d)(3) of the Exchange Act.
The definition of change in control includes a phrase relating to the
conveyance, transfer, sale, lease or disposition of "all or substantially all"
of our assets. There is no precise, established definition of the phrase
"substantially all" under applicable law. Accordingly, your ability to require
the issuer to redeem your notes as a result of conveyance, transfer, sale, lease
or other disposition of less than all of our assets may be uncertain.
The foregoing provisions would not necessarily provide you with protection
if we are involved in a highly leveraged or other transaction that may adversely
affect you.
Redemption at Option of Holders on Selected Dates
You will have the right, at your option, to require the issuer to redeem,
on each of August 21, 2004, August 21, 2006 and August 21, 2008, all of your
notes not previously called for redemption, or any portion of the principal
amount of your notes that is equal to $5,000 or any greater even multiple of
$1,000. The price the issuer is required
-26-
to pay is 100% of the principal amount of the notes to be redeemed, together
with interest accrued to the redemption date. In order to exercise this option,
you must give the issuer notice of your decision between 30 and 15 business days
prior to the applicable redemption date.
At the issuer's option, instead of redeeming the notes in respect of which
you have exercised your right to require redemption, the issuer may elect to
convert all or part of the notes into preference shares, exchangeable into our
ordinary shares (or, at your option as specified in your notice of exercise,
ADSs, if an effective registration statement is in effect with respect to such
ADSs) at a special exchange ratio equal to 100% of the principal amount of the
notes being converted divided by the market price of our ordinary shares valued
at 95% of the average of the LSE volume-weighted average prices, as seen on
Bloomberg Professional Service, of our ordinary shares for the five trading days
immediately following the date the issuer gives you notice of its election to
convert the notes into preference shares rather than redeem the notes (each such
price converted into U.S. dollars at the $/(pound) noon buying rate in New York
prevailing on such date). The issuer may only choose to convert notes into
preference shares exchangeable for our ordinary shares or ADSs if we satisfy
conditions provided in the indenture. The issuer will inform you of its election
to convert the notes into preference shares rather than redeem the notes on the
tenth business day prior to the applicable redemption date. If ordinary shares
or ADSs are not issued to you by the 14th day after the applicable redemption
date, you may elect for the issuer to procure the payment to you of cash in an
amount equal to the original redemption amount, plus accrued interest to the
payment date, rather than procure the issue of our ordinary shares or ADSs.
General
Rule 13e-4 under the Exchange Act requires the dissemination of prescribed
information to securityholders in the event of an issuer tender offer and may
apply in the event that a redemption option becomes available to you. We and the
issuer will comply with this rule to the extent it applies at that time.
We and any of our subsidiaries, including the issuer, may, to the extent
permitted by applicable law, including the requirements of the U.K. Listing
Authority or the LSE, or any other stock exchange on which the notes may be
listed, at any time purchase notes in the open market or by tender at any price
or by private agreement. Any note that we or any of our subsidiaries other than
the issuer purchases may, at our option, be surrendered to the trustee for
cancellation. Any notes the issuer purchases will be canceled promptly. None of
the notes we or any of our subsidiaries purchases may be reissued or resold. All
notes redeemed or converted will be canceled promptly.
The issuer's ability to redeem notes at the option of the holders is
subject to important limitations. We cannot assure you that the issuer would
have the financial resources, or would be able to arrange financing, to pay the
redemption price for all the notes that might be delivered by holders of notes
seeking to exercise the redemption right. If the issuer were to fail to redeem
the notes when required following a change in control or on any of the specified
dates, an event of default under the indenture would occur.
Street name and other indirect holders should consult their banks or
brokers for information on how to direct the exercise of the option to require
the issuer to redeem the notes upon a change in control or on the specified
dates.
Optional Redemption by the Issuer
The issuer may redeem the notes at its option at any time on or after
August 21, 2004, in whole or in part, at a redemption price equal to 100% of the
principal amount of the notes redeemed, plus accrued and unpaid interest to the
redemption date. The issuer may only exercise this option during this period if
the average of the closing bid and offer quotations per ordinary share published
in the LSE Daily Official List for twenty of the thirty consecutive dealing days
ending within fourteen days of giving notice of the redemption is at least 130%
of the exchange price in effect on that dealing day. The exchange price is equal
to $1,000 divided by the exchange ratio.
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The indenture requires the issuer to give notice of redemption pursuant to
this option between 30 and 60 days before the redemption date.
No "sinking fund" is provided for the notes, which means that the indenture
does not require the issuer to redeem or retire the notes periodically.
The Guarantees
Shire, which holds 100% of the issued shares (not including preference
shares) of the issuer, has fully and unconditionally guaranteed:
o all payments of principal and interest payable under the notes by the
issuer; and
o following any conversion of the notes into preference shares of the
issuer, all payments of dividends on the preference shares and all
liquidation preferences of the preference shares if the issuer is
liquidated.
We have agreed, in the indenture and in a separate guarantee agreement
covering our payment guarantee of the preference shares, not to alter our
obligation, pursuant to a bilateral contract between the issuer and us, to issue
our ordinary shares to the holders of preference shares in order that the issuer
might meet its exchange obligations under the terms of its preference shares. We
also agreed in these documents to procure that the issuer complies with its
conversion and exchange obligations under the notes and its memorandum and
articles of association.
We have guaranteed the payment of these amounts and the performance of
these obligations when they become due and payable or are required to be
performed. You do not need to proceed against the issuer before you can proceed
against us under the payment guarantees. The payment guarantees are senior,
unsubordinated and unsecured obligations of Shire, which means that they rank on
a parity with all of our other present and future senior, unsubordinated
indebtedness, except as required by mandatory provisions of law, and senior to
all of our other indebtedness.
Mergers and Sales of Assets by Shire
We may not consolidate with or merge into any other person or convey,
transfer, sell or lease our properties and assets substantially as an entirety
to any person, and we may not permit any person to consolidate with or merge
into us, unless each of the following requirements is met:
o the person formed by the consolidation or merger or the person to
which our properties and assets are conveyed, transferred, sold or
leased is a corporation, limited liability company, partnership or
trust organized and existing under the laws of England and Wales, any
member state of the European Union, Switzerland, the United States,
any state thereof or the District of Columbia and, if other than us,
shall expressly assume the due and punctual payment of the principal
of, any premium and interest on the notes and the performance of our
other covenants under the indenture;
o immediately after giving effect to that transaction, no event of
default, and no event which, after notice or lapse of time or both,
would become an event of default, shall have occurred and be
continuing; and
o an officer's certificate and legal opinion relating to these
conditions is delivered to the trustee.
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Taxation
All payments in respect of the notes or the guarantees will be made without
withholding of or deduction for taxation unless the withholding or deduction is
required by law. Neither the issuer nor we will be required to pay you any
additional amounts as a result of any withholding or deduction that is required
by law.
Further Undertakings of Shire
We have agreed, for so long as any notes are outstanding:
(1) to keep enough ordinary shares available for issue free from pre-emptive
rights to enable the issuer to meet at any time its obligations in full to
exchange preference shares issuable on conversion of outstanding notes for
our ordinary shares or ADSs in accordance with the issuer's memorandum and
articles of association;
(2) not to modify in any way the rights attaching to our ordinary shares with
respect to voting, dividends or liquidation, nor to issue any other class
of equity share capital carrying any rights which are more favorable than
such rights. This agreement, however, will not preclude:
o the issue of equity share capital to employees, including executive
officers, or directors of Shire or any of our subsidiaries or
associated companies pursuant to any employees' or directors' share
plan or option plan;
o any consolidation or subdivision of the ordinary shares;
o any modification of such rights which is not materially prejudicial to
the interests of the holders of the notes;
o any issue of ordinary shares upon exchange of the exchangeable shares
of Shire Acquisition Inc. or the remaining shares of Roberts or the
conversion of the unsecured convertible zero coupon loan note due to
Arenol Corporation;
o any issue of equity share capital where the issue of such equity share
capital results in an adjustment to the exchange ratio, or would
result in an adjustment to the exchange ratio if (1) the adjustment
were greater than 1% of the exchange ratio or (2) the relevant issue
were at less than 95% of the current market price per ordinary share
on the relevant dealing day; or
o any alteration to our articles of association in connection with or
incidental to any of the above; and
(3) not to reduce our issued share capital, share premium account or capital
redemption reserve or any uncalled liability in respect of any of these,
except:
o pursuant to the terms of issue of the relevant share capital;
o by means of a purchase or redemption;
o as permitted by Section 130(2) of the Companies Act 1985 of the United
Kingdom;
o where the reduction does not involve any distribution of assets;
o where the reduction results in an adjustment to the exchange ratio, or
would result in an adjustment to the exchange ratio if the adjustment
were greater than 1% of the exchange ratio; or
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o solely in relation to a change in the currency in which the nominal
value of the ordinary shares is expressed.
These obligations may only be waived by the holders of a majority in
principal amount of the outstanding notes or the consent of the trustee where,
in the opinion of the trustee, it is not materially prejudicial to the interests
of the noteholders to give such approval.
Deemed Conversion Rights upon the Liquidation of Shire
If an effective resolution is passed or an order of a court is made on or
before the maturity date of the notes for the winding-up of Shire, then we will
give notice to you that such a resolution has been passed or such an order has
been made. (We do not, however, have to give you notice of such a resolution or
court order for the purpose of or in connection with a reconstruction,
amalgamation, reorganization or similar arrangement on terms that have been
previously approved by the trustee or by the holders of a majority in principal
amount of the outstanding notes.) After receiving such a notice, you will have
the right at any time within three months of the date of our notice to you to
elect to be treated as if you had exercised your conversion and exchange rights
immediately before the date of passing of such resolution or the making of such
order, as the case may be. If you exercise this election, you will be entitled
to receive, out of the assets which will be available to our shareholders on our
liquidation, an amount equal to the amount which you would have received had you
in fact been the holder of the ordinary shares to which you would have been
entitled by virtue of such exercise. You may not make this election in respect
of any note on or after the record date for the payment of the principal due on
the note. We will indicate in our notice to you the applicable exchange ratio.
Events of Default
The following are events of default under the indenture:
o failure to pay principal of or any premium on any note when due
(including upon any requirement that the issuer redeem the notes);
o failure to pay any interest on any note when due and that default
continues for 30 days;
o failure to give the notice required to be given in the event of a
change in control;
o failure to perform any other covenant in the indenture and that
failure continues for 60 days after written notice to the issuer and
to us by the trustee or the holders of at least 25% in aggregate
principal amount of outstanding notes;
o failure to pay when due the principal of, or acceleration of, any
indebtedness for money borrowed by us or any of our subsidiaries
(including the issuer) in excess of $25 million (excluding equipment
and facilities leases) if the indebtedness is not discharged, or the
acceleration is not annulled, within 30 days after written notice to
the issuer and to us by the trustee or the holders of at least 25% in
aggregate principal amount of the outstanding notes; and
o events of the issuer's or our bankruptcy, insolvency or reorganization
specified in the indenture.
Subject to the provisions of the indenture relating to the duties of the
trustee in case an event of default shall occur and be continuing, the trustee
is under no obligation to exercise any of its rights or powers under the
indenture at the request or direction of any of the holders, unless such holders
shall have offered to the trustee reasonable indemnity. Subject to the
provisions for the indemnification of the trustee, the holders of a majority in
ag-
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gregate principal amount of the outstanding notes has the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the trustee or exercising any trust or power conferred on the trustee.
If an event of default, other than an event of default arising from events
of bankruptcy, insolvency or reorganization of Shire, occurs and is continuing,
either the trustee or the holders of at least 25% in principal amount of the
outstanding notes may accelerate the maturity of all of the notes. After
acceleration, but before a judgment or decree based on acceleration, the holders
of a majority in aggregate principal amount of the outstanding notes may, under
circumstances set forth in the indenture, rescind the acceleration if all events
of default, other than the nonpayment of principal of the notes which have
become due solely because of the acceleration, have been cured or waived as
provided in the indenture. If an event of default arising from events of our
bankruptcy, insolvency or reorganization occurs and is continuing, then the
principal of, and accrued interest on, all of the notes will automatically
become immediately due and payable without any declaration or other act on the
part of the holders of notes or the trustee.
Before you may take any action to institute any proceeding relating to the
indenture, or to appoint a receiver or a trustee, or for any other remedy, each
of the following must occur:
o you must have given the trustee written notice of a continuing event
of default;
o the holders of at least 25% of the aggregate principal amount of all
outstanding notes must make a written request of the trustee to take
action because of the default and must have offered reasonable
indemnification to the trustee against the cost, liabilities and
expenses of taking such action; and
o the trustee must not have taken action for 60 days after receipt of
such notice and offer of indemnification.
These limitations do not apply to a suit for the enforcement of payment of
the principal of or any premium or interest on a note, or the redemption amount
of a note, on or after the due dates for such payments or of the right to
convert the note in accordance with the indenture.
We and the issuer will furnish to the trustee annually a statement as to
our performance of our respective obligations under the indenture and as to any
default in performance.
Street name and other indirect holders should consult their banks or
brokers for information on how to give notice or direction to or make a request
of the trustee and to make or annul a declaration of acceleration.
Modification and Waiver
The consent of the holders of a majority in principal amount of the
outstanding notes affected is required to make a modification or amendment to
the indenture. However, a modification or amendment requires the consent of the
holder of each outstanding note affected if it would:
o change the stated maturity of the principal or interest of a note;
o reduce the principal amount, any premium or interest on any note;
o reduce the amount payable upon a redemption of a note;
o modify the provisions with respect to the redemption rights of holders
of notes in a manner adverse to the holders;
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o change the place or currency of payment on a note;
o impair the right to institute suit for the enforcement of any payment
on any note;
o adversely affect the right to convert the notes;
o reduce the percentage of holders whose consent is needed to modify or
amend the indenture;
o reduce the percentage of holders whose consent is needed to waive
compliance with certain provisions of the indenture or to waive
certain defaults; or
o modify the provisions dealing with modification and waiver of the
indenture.
The holders of a majority in principal amount of the outstanding notes must
provide written consent to waive compliance by the issuer or us with certain
restrictive provisions of the indenture. The holders of a majority in principal
amount of the outstanding notes may waive any past default, except a default in
the payment of principal, any premium, interest or redemption amounts.
Noteholder consent will not be required in connection with the following
amendments:
o to cure any inconsistency, omission, defect or ambiguity in the
indenture; o to add to the issuer's or our covenants and agreements;
o to assign the trustee's rights and duties to a qualified successor;
o to evidence the succession of another person to the issuer or to us
and the assumption by the successor to the issuer's or our obligations
and our covenants, where the parties are amending the indenture in a
similar way;
o to comply with the Securities Act, the Exchange Act, the Investment
Company Act of 1940 or the Trust Indenture Act of 1939, each as
amended; or
o to modify, alter, amend or supplement the indenture in any other
manner that is not adverse to the holders of the notes.
No amendment to the indenture or the notes or the book-entry securities
that affects DTC, Euroclear, Clearstream or the holders of book-entry securities
in an adverse way will be allowed without the consent of DTC, Euroclear or
Clearstream, as the case may be.
Notes will not be considered outstanding if money for their payment or
redemption has been deposited or set aside in trust for the holders.
The issuer will generally be entitled to set any day as a record date for
the purpose of determining the holders of outstanding notes that are entitled to
take any action under the indenture. In limited circumstances, the trustee will
be entitled to set a record date for action by holders. If a record date is set
for any action to be taken by holders, such action may be taken only by persons
who are holders of outstanding notes on the record date and must be taken within
180 days following the record date or such other period as we may specify (or as
the trustee may specify, if it set the record date), this period may be
shortened or lengthened (but not beyond 180 days) from time to time.
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Street name and other indirect holders should consult their banks or
brokers for information on how approval may be granted or denied if we seek to
modify or amend the indenture or the notes or request a waiver.
Meetings of Noteholders
The indenture contains provisions for convening meetings of the holders of
notes for any of the following purposes:
o to give any notice to the issuer, us or the trustee, or to give any
directions to the trustee, or to consent to the waiving of any default
under the indenture and its consequences, or to take any other action
authorized to be taken by holders under the indenture;
o to remove the trustee and appoint a successor trustee; or
o to consent to the execution of a supplemental indenture.
Notice of at least 21 days must be given of any meeting. A meeting must be
called if requested in writing by the holders of at least one-tenth of the
aggregate principal amount of the outstanding notes. The quorum for any meeting,
other than an adjourned meeting, shall be the holders of at least one-third of
the aggregate principal amount of the outstanding notes. No action at a meeting
of holders will be effective unless approved by persons holding or representing
notes in the aggregate principal amount required by the applicable provision of
the indenture. At any meeting of holders, each holder or proxy will be entitled
to one vote for each $1,000 principal amount of outstanding notes held or
represented. A proxy need not be a holder of the notes.
Listing
The notes have been admitted to the Official List of the U.K. Listing
Authority and to trading on the LSE.
Notices
The issuer will give notice to holders of notes by mail to the addresses of
the holders as they appear in the security register. Notices will be deemed to
have been given on the date of mailing. The issuer will give holders of notes
irrevocable notice that it is exercising its option to redeem the notes not less
than 30 nor more than 60 days before the redemption date.
Replacement of Notes
The issuer will replace, at the expense of the holders, notes that become
mutilated, destroyed, stolen or lost upon delivery to the trustee of the
mutilated notes or evidence of the loss, theft or destruction of the notes
satisfactory to the issuer and the trustee. In the case of a lost, stolen or
destroyed note, indemnity satisfactory to the trustee and the issuer may be
required at the expense of the holder of the note before a replacement note will
be issued.
The Trustee
The trustee for the holders of notes issued under the indenture is The Bank
of New York. If an event of default occurs and is not cured, the trustee is
required to use the degree of care of a prudent person in the conduct of his own
affairs in the exercise of its powers. Subject to these provisions, the trustee
is under no obligation to exercise any of its rights or powers under the
indenture at the request of any holders of notes, unless they shall have offered
to the trustee reasonable security or indemnity.
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Governing Law and Consent to Jurisdiction and Service
The indenture and the notes are governed by New York law. The issuer and we
have appointed CT Corporation System as our agent for the service of process in
any suit, action or proceeding with respect to the indenture or the notes and
for actions brought in a U.S. federal or state court in New York City under U.S.
federal or state securities laws.
Arrangements Relating to Notes in Global Form
The Rule 144A global note and the registered resale global note have been
deposited with a custodian for, and registered in the name of, Cede & Co., as
nominee of DTC. The Regulation S global note has been deposited with, and
registered in the name of a nominee for, a common depositary for Euroclear and
Clearstream. The global note that will be issued upon the effectiveness of the
registration statement of which this prospectus forms a part, which we refer to
as the "registered resale global note," will on issue be deposited with a
custodian for, and registered in the name of, Cede & Co., as nominee of DTC.
Holders can hold a beneficial interest in the Rule 144A global note or the
registered resale global note only directly through DTC or indirectly through
participants or indirect participants in DTC. Holders can hold a beneficial
interest in the Regulation S global note only directly through Euroclear or
Clearstream or indirectly through participants or indirect participants in
Euroclear or Clearstream. These beneficial interests may be held in such
denominations as are permitted by DTC, Euroclear or Clearstream, as applicable.
Indirect participants are banks, brokers, dealers, trust companies and other
parties that clear through or maintain a custodial relationship with a
participant. Beneficial interests in the global notes are called book-entry
securities. Ownership of beneficial interests in the global notes will be in the
form of book-entry securities.
The ultimate beneficial owners of the global notes can only be indirect
holders. We do not recognize this type of investor as a holder of notes and
instead only deal with the registered holders of the global notes. As an
indirect holder, an investor's rights and obligations relating to a global note
will be governed by the account rules of DTC, Euroclear or Clearstream and the
investor's financial institution. We, the trustee, any paying agent, the
registrar and any of our or their agents will not be responsible for the
obligations under the rules and procedures of DTC, Euroclear or Clearstream, any
of their respective participants or an investor's financial institution.
We have no responsibility for any aspect of the actions of any participant
in DTC, Euroclear or Clearstream or for payments related to, or for its records
of, ownership interests in the global notes. We also do not supervise the
participants in DTC, Euroclear or Clearstream in any way, nor will we govern
payments, transfers, exchange and other matters relating to the investor's
interest in the global notes.
Payments
Payments related to the notes are made through the facilities of The Bank
of New York, as principal paying agent to the nominee of DTC as the registered
holder of the Rule 144A note and the registered resale global note and to the
nominee of the common depositary as the registered holder of the Regulation S
note. Payments to DTC's nominee and to the nominee of the common depositary will
discharge our payment obligations in respect of the notes. Upon receipt, DTC,
Euroclear and Clearstream have informed us that they will credit their
participants' accounts on that date with payments in amounts proportionate to
their respective ownership interests as shown on their respective records.
Payments by participants in DTC, Euroclear or Clearstream to the owners of
book-entry securities will be the participants' responsibility. We expect that
payment by participants in DTC, Euroclear or Clearstream to the owners of
interests in book-entry securities will be governed by standard customary
practices, as is now the case with the securities held for the accounts of
customers registered in street name.
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All payments will be made through the facilities of the paying agent or
agents. Payments will be made subject to the deduction or withholding of any
taxes, duties, assessments or other governmental charges required by applicable
laws or regulations.
Redemption
If and when the global notes are redeemed, all amounts in respect of the
redemption will be paid through the facilities of the paying agent or agents to
the nominee of DTC or the nominee of the common depositary for Euroclear or
Clearstream, as the case may be. The redemption price that will be paid for the
book-entry securities will be equal to the amount paid to the depositary systems
for the applicable global notes.
Transfers and Transfer Restrictions
Transfers of all or any portion of the global notes may be made only
through the book-entry register. Until the book-entry securities are exchanged
for definitive notes, the global notes may only be transferred as a whole by:
o DTC to a nominee of DTC;
o the common depositary to a nominee of the common depositary;
o by a nominee of DTC to DTC or another nominee of DTC;
o by a nominee of the common depositary to the common depositary or
another nominee of the common depositary;
o by DTC or any such nominee to a successor of DTC or a nominee of such
successor; or
o by the common depositary or any such nominee to a successor of the
common depositary or a nominee of such successor.
DTC, Euroclear and Clearstream, as the case may be, will record all
transfers of the interests in book-entry securities using their respective
book-entry systems. DTC, Euroclear and Clearstream will use their customary
procedures in this regard.
A beneficial interest in a Rule 144A global note may be transferred to a
person who wishes to take delivery of such interest in the form of an interest
in the Regulation S global note only in accordance with Regulation S.
Clearance and Settlement
General
The notes are held through the book-entry systems operated by DTC,
Euroclear and Clearstream and their respective participants. These systems have
established electronic securities and payment transfer, processing, depositary
and custodial links among themselves and others, either directly or through
custodians and depositaries. These links allow notes to be issued, held and
transferred among these clearing systems without the physical transfer of
certificates.
The policies of DTC, Euroclear and Clearstream govern payments, transfers,
exchange and other matters relating to the investor's interest in notes held by
them.
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We have no responsibility for any aspect of the actions of DTC, Clearstream
or Euroclear or any of their direct or indirect participants. We have no
responsibility for any aspect of the records kept by DTC, Clearstream or
Euroclear or any of their direct or indirect participants. We also do not
supervise these systems in any way.
DTC, Euroclear and Clearstream and their participants perform these
clearance and settlement functions under agreements they have made with one
another or with their customers. You should be aware that they are not obligated
to perform these procedures and may modify them or discontinue them at any time.
The description of the clearing systems in this section reflects our
understanding of the rules and procedures of DTC, Euroclear and Clearstream as
they are currently in effect. These systems could change their rules and
procedures at any time.
Transfers of Beneficial Interests in the Global Notes
Trading between DTC participants Ownership of the Rule 144A global note or
the registered resale global note may only be transferred in whole and may only
be transferred to another nominee of DTC or to a successor of DTC or its
nominee. A beneficial owner of an interest in the Rule 144A global note or the
registered resale global note may hold its interest directly through DTC if such
person is a participant in DTC, or indirectly through organizations which are
direct DTC participants if such person is not a participant in DTC. Transfers
between direct DTC participants will be effected in accordance with DTC's rules
and will be settled using the procedures applicable to U.S. corporate debt
obligations or depositary receipts, as the case may be, in DTC's SDFS system in
same-day funds, if payment is made in U.S. dollars, or free of payment, if
payment is not effected in US dollars. If payment is not made in U.S. dollars,
separate payment arrangements outside DTC are required to be made between the
DTC participants. Beneficial owners may also own interests in the global note
held by DTC through banks, brokers, dealers, trust companies and other parties
that clear through or maintain a custodial relationship, either directly or
indirectly, with a direct DTC participant.
Trading between participants in Euroclear and Clearstream
Transfers between participants in Euroclear or Clearstream will be effected
in accordance with the normal rules and operating procedures of Euroclear and
Clearstream and will be settled using the procedures applicable to conventional
eurobonds. Euroclear and Clearstream will hold interests in the Regulation S
global note on behalf of their participants through customers' securities
accounts in their respective names on the books of their common depositary.
Euroclear and Clearstream have established an electronic bridge between their
two systems across which their respective participants may settle trades with
each other.
Trading between a DTC seller and a Euroclear or Clearstream purchaser
When an interest in a global note held by DTC is to be transferred from the
account of a DTC participant to the account of a Euroclear or Clearstream
participant, the DTC participant must send to DTC a free of payment instruction
at least two business days prior to the settlement date. DTC will in turn
transmit this instruction to Euroclear or Clearstream, as the case may be, on
the settlement date. Separate payment arrangements are required to be made
between the DTC participant and the relevant Euroclear or Clearstream,
Luxembourg participant. On the settlement date, DTC will debit the account of
its participant and will instruct the paying and transfer agent to instruct
Euroclear or Clearstream, as the case may be. In addition, on the settlement
date, DTC will instruct the paying and transfer agent and the registrar to (1)
decrease the amount of book-entry interests in the name of Cede & Co.
representing interests in the global note held by DTC, and (2) increase the
amount of book-entry interests registered in the name of the common depositary
for the accounts of Euroclear and Clearstream and representing interests in the
Regulation S global note.
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Trading between a Euroclear or Clearstream seller and a DTC purchaser
When interests in the Regulation S global note are to be transferred from
the account of a Euroclear or Clearstream participant to the account of a DTC
participant, the Euroclear or Clearstream participant must send to Euroclear or
Clearstream a free of payment instruction at least one business day prior to the
settlement date. Euroclear or Clearstream, as the case may be, will in turn
transmit this instruction to DTC on the settlement date. Separate payment
arrangements are required to be made between the DTC participant and the
relevant Euroclear or Clearstream participant, as the case may be. On the
settlement date, Euroclear or Clearstream, as the case may be, will debit the
account of its participant and will instruct the paying and transfer agent to
instruct DTC to credit the relevant account of Euroclear or Clearstream, as the
case may be, at DTC. DTC will then debit its account, as the case may be, and
will deliver such interests in the Regulation S global note, free of payment, to
the relevant account of the DTC participant. In addition, Euroclear or
Clearstream, as the case may be, shall on the settlement date instruct the
paying and transfer agent and the registrar to (1) decrease the amount of the
book-entry interests registered in the name of the common depositary for the
account of Euroclear or Clearstream and representing interests in the Regulation
S global note, and (2) increase the amount of the book-entry interests
registered in the name of Cede & Co. and representing interests in the
applicable global note held by DTC.
Special Timing Considerations
You should be aware that investors will only be able to make and receive
deliveries, payments and other communications involving notes through Euroclear
and Clearstream on days when those systems are open for business. Those systems
may not be open for business on days when banks, brokers and other institutions
are open for business in the United States.
In addition, because of time-zone differences, there may be problems with
completing transactions involving Euroclear and Clearstream on the same business
day as in the United States. U.S. investors who wish to transfer their interests
in the notes, or to receive or make a payment or delivery of notes, on a
particular day, may find that the transactions will not be performed until the
next business day in Brussels or Luxembourg, depending on whether Euroclear or
Clearstream is involved.
The Registration Rights Agreement
We have entered into a registration rights agreement with the initial
purchasers. Pursuant to the registration rights agreement, we have agreed to
keep the shelf registration statement, of which this prospectus forms a part,
continuously effective until the earliest of
o the sale of all the securities registered under the shelf registration
statement;
o the expiration of the period referred to in Rule 144(k) under the
Securities Act with respect to notes and the ordinary shares or
ordinary shares underlying the ADSs issuable upon conversion of the
notes and exchange of the preference shares held by non-affiliates of
Shire (including conversion and exchange at the option of the issuer
following the exercise of a holder's right to have its notes
redeemed); and
o two years from the date the shelf registration statement is declared
effective.
We and the issuer will also take all reasonable steps to enable holders to
use this prospectus to offer and sell notes or ordinary shares and ADSs which
may be issued upon exchange of the preference shares issued upon conversion of
the notes, including identifying such holders who wish to be included as selling
securityholders in the shelf registration statement. In this section, we refer
to these holders as "electing holders." We refer to the notes and the ordinary
shares that may be issued, in the form of ordinary shares or ADSs, upon exchange
of the preference
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shares issued upon conversion of the notes and covered by the shelf registration
statement collectively as the "covered securities."
Electing holders who sell covered securities pursuant to the shelf
registration statement generally will be required to be named as a selling
securityholder in the related prospectus and to deliver a prospectus to
purchasers. In order to be named as a selling securityholder, electing holders
must complete and return to us a completed and signed notice and questionnaire.
Electing holders will also be subject to certain of the civil liability
provisions under the Securities Act in connection with such sales, and they will
be bound by some of the provisions of the registration rights agreement,
including certain indemnification obligations.
If at any time the preference shares are exchangeable into securities other
than our ordinary shares or ADSs, we and the issuer will take steps to cause
such securities to be included in the shelf registration statement.
We and the issuer will have the right to suspend the use of the prospectus
for up to 45 days in any 90-day period (extendible up to 75 days in any 90-day
period in the circumstances described below) or an aggregate of 90 days in any
12-month period. We and the issuer may only suspend the use of the prospectus if
our board of directors has determined in good faith that because of valid
reasons, including the acquisition or divestiture of assets, pending corporate
developments and similar events, it is in our best interest to do so.
We and the issuer can extend the suspension to 75 days in any 90-day period
if we or the issuer possess material non-public information:
o the disclosure of which would have a material adverse effect on us and
our subsidiaries, taken as a whole;
o if such information relates to an undisclosed proposal or pending
transaction and, in our reasonable belief, its disclosure would impede
our or its ability to consummate such transaction; or
o or otherwise with the prior written permission of Bear, Stearns
International Limited and Goldman Sachs International in their
capacity as the representatives of the initial purchasers. We and the
issuer will provide notice of any such suspension in advance. The
notice need not specify the nature of the event giving rise to the
suspension.
Covered securities will not be resold in an underwritten offering unless we
and the issuer agree in our sole discretion to do so. We and the issuer will
cover all expenses customarily borne by issuers in an underwritten offering to
which we and the issuer agree.
We and the issuer will be responsible for the costs of registration of
offers and sales of the covered securities pursuant to the shelf registration
statement. Under certain circumstances we may grant third parties "piggy-back"
registration rights with respect to the shelf registration statement.
In the event that the shelf registration statement ceases to be effective
for more than 45 days (or 60 days if extended as described above) in any 90-day
period, or for more than 90 days in any 12-month period, then the issuer will be
required to pay additional interest in cash on each interest payment date in an
amount equal to one half of one percent (0.5%) per annum of the principal amount
of the covered securities from the 46th, 61st or 91st day, as the case may be.
Such additional interest will cease to accrue from the date the shelf
registration statement becomes effective again. If, however, after any such
additional interest ceases to accrue, the shelf registration statement again
ceases to be effective, additional interest will again accrue as described
above. In no event will the issuer ever be required to pay additional interest
of more than 0.5%.
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DESCRIPTION OF THE PREFERENCE SHARES
The preference shares, which will be issued in registered form, will be
issued upon conversion of the notes. The terms of the preference shares are
contained in the memorandum and articles of association of the issuer. The
holders of the preference shares will be entitled to the benefits of (x) the
provisions of the issuer's memorandum and articles of association relating to
the preference shares and (y) Shire's guarantees and agreements under the
separate preference share guarantee agreement as described above under
"Description of the Notes--The Guarantees." Set forth below is a brief summary
of certain significant provisions of the issuer's memorandum and articles of
association.
Issuance of the Preference Shares
The issuer will issue preference shares only upon conversion of the notes
in accordance with the terms and conditions of the notes and the indenture. Each
$1,000 principal amount of notes may be converted into one preference share. The
preference shares will be issued, credited as fully paid, at the price of $1,000
per preference share. The issue price corresponds to a nominal value of $1 per
preference share and a premium on issue of $999 each.
Dividends
Each preference share entitles its holder to receive a fixed cumulative
preferential cash dividend equivalent to a dividend of 2% per year (accruing
daily) on the paid-up value of the preference share of $1,000. The issuer will
pay dividends semi-annually on February 22 and August 22 of each year, from and
including the preceding dividend payment date (or, in the case of the first
dividend payment date, the date of issue of the preference share) to, but
excluding, the redemption date of the preference share. Dividends payable in
respect of any period which is not a full dividend period will be calculated on
the basis of a 365-day year and the number of days elapsed. Each preference
share will cease to accrue dividends on its date for redemption unless payment
of the redemption price is not made on that date.
Dividends on the issuer's preference shares will be payable prior to any
dividend in respect of any other class of share capital of the issuer, other
than any class of preference shares having equal preference with respect to
dividend payments. As of the date of this prospectus, there is no such class of
preference shares having equal preference with respect to dividend payments
either authorized or outstanding.
Holders of preference shares will not have any claim on the profits of the
issuer other than the payment of dividends.
The obligation of the issuer to pay dividends is subject to applicable law
in the Cayman Islands. Our guarantee of dividend payments, however, is full and
unconditional, regardless of whether:
o the profits of the issuer justify the payment of any dividend;
o the relevant amounts are available for payment or distribution;
o payment has been declared or approved by or on behalf of the issuer or
any general meeting of the issuer;
o payment is prohibited by law; or
o the preference shares have been issued, to the extent the conversion
rights requiring the issue of such preference shares were duly
exercised.
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Voting Rights
Holders of preference shares shall be entitled to receive notice of general
meetings of the issuer, but are not entitled to attend or vote at general
meetings.
Liquidation Rights
In the event of a winding up of the issuer or other return of capital other
than a purchase or redemption of the preference shares or other redeemable
shares, holders of the preference shares are entitled to receive all arrears and
accruals of dividends on the preference shares, whether or not such a dividend
has been declared or approved, up to, but excluding, the date of the
commencement of the winding up, together with an amount equal to the amount paid
up on the preference shares. Holders of preference shares have priority over any
payment to holders of other classes of the issuer's share capital, other than
any class of preference shares having equal preference with respect to
liquidation rights. As of the date of this prospectus, there is no such class of
preference shares having equal preference with respect to liquidation rights
either authorized or outstanding.
Exchange Rights
Upon the exercise of conversion and exchange rights by any holder of notes,
the issuer will procure the exchange of the preference shares issued upon
conversion of the notes for Shire ordinary shares or ADSs or, at the issuer's
option, cash. This exchange will have effect from the conversion and exchange
date. Any preference shares which are exchanged will be immediately transferred
to Shire or its nominee in exchange for the issue to the holder of the
preference shares of the number of ordinary shares or ADSs or, at the issuer's
option, the amount of cash to which the holder is entitled. A description of the
memorandum and articles of association to be adopted by the issuer relating to
the noteholders' conversion and exchange rights is set out above under
"Description of the Notes--Conversion and Exchange Rights."
If the issuer does not exercise its option to procure the exchange of your
preference shares for cash, as described above under "Description of the
Notes--Cash-Out Option," you will be treated as if you were a holder of our
ordinary shares as of the conversion and exchange date and therefore entitled to
receive, in addition to the ordinary shares or ADSs, cash consideration equal to
any dividends payable to holders of our ordinary shares as of any record date
between the conversion and exchange date and the date on which the ordinary
shares are issued to you. You will not be entitled to exercise any voting rights
of such ordinary shares or ADSs if the relevant record date falls after the
conversion and exchange date but before the date on which the ordinary shares or
ADSs are issued to you.
The issuer will effect the transfer as agent for the holder of the
preference share, and the holder will be deemed to have authorized the issuer to
enter into all agreements and take all steps necessary to complete the transfer
and exchange. Other than any tax or duty that may be payable in respect of any
transfer involved in the issue or delivery of our ordinary shares or ADSs in a
name other than that of the holder of the preference share, there will be no
transfer or documentary taxes due from, or any further action required by, the
holder in respect of the exchange.
Redemption Rights
Subject to Cayman Islands law, the issuer will, at the request of the
holder, redeem all preference shares for cash equal to their paid-up value,
together with all arrears and accruals of dividends on the preference shares,
whether or not such a dividend has been declared or approved, up to, but
excluding, the redemption date at any time after their transfer into the name of
Shire or its nominee. The issuer will cancel any redeemed preference shares.
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Amendment of Class Rights
Subject to applicable Cayman Islands law, so long as the capital of the
issuer is divided into different classes of shares, the rights attached to any
class of shares may be varied or eliminated with the written consent of the
holders of not less than 75% in nominal value of the issued shares of that class
or by the passing of an extraordinary resolution at a separate meeting of the
holders of the shares of that class.
The necessary quorum of any such meeting will be two or more persons
holding or representing by proxy not less than one-third in nominal value of the
issued shares of that class. The following actions will be deemed to be
variations of the rights attached to the preference shares:
o the creation or issue of any shares of the issuer ranking ahead of the
preference shares with respect to dividend payments, liquidation
preference or redemption rights;
o any allotment of shares pursuant to a capitalization of the share
premium account of the issuer; or
o any reduction in the share premium account or the share capital of the
issuer, or any uncalled liability in respect of the share capital of
the issuer.
Except as set out above, neither the issuance or creation of other classes
of shares ranking equally with the preference shares nor the redemption of any
of the preference shares will be deemed to vary the rights of the preference
shares.
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THE ISSUER
Organization
Shire Finance Limited, the issuer of the notes and the preference shares
issuable upon conversion of the notes, is organized as an exempted limited
company organized under the laws of the Cayman Islands. The issuer was
incorporated on July 19, 2001, under the number 111672. Its registered office is
located at Maples and Calder, Ugland House, South Church Street, P.O. Box 309,
George Town, Grand Cayman, Cayman Islands, British West Indies. The objects of
the issuer as set forth in its memorandum and articles of association are
unrestricted and the issuer has full power and authority to carry out any object
not prohibited by the laws of the Cayman Islands. The issuer has not engaged in
any activities other than those incidental to its formation, the authorization
and issuance of the notes and the preference shares, approval of the terms of
the notes and the preference shares, the lending of the proceeds of the notes
and activities incidental to or connected with the foregoing.
Directors and Executive Officers
The directors of the issuer are Messrs. Rolf Stahel and Angus Russell.
Subject to the making of any requisite declarations of interest under Cayman
Islands law, a director may vote on any transaction or arrangement in which he
is interested or upon any related matter.
The secretary of the issuer is Tatjana May. Ms. May is also our General
Counsel and Company Secretary, having joined us in May 2001. Prior to joining us
Ms. May had practiced as a lawyer at AstraZeneca plc since January 1995, before
which she was a solicitor with Slaughter and May.
Capitalization and Indebtedness
The authorized share capital of the issuer is US$50,000, divided into
50,000 shares with a par value of US$1 each. Except as described below, as of
the date of this prospectus the issuer does not have any outstanding
indebtedness. The table below sets out the capitalization and indebtedness of
the issuer as of August 15, 2001, adjusted to reflect the issuance of the notes.
$'000
Share capital (100 shares issued, $1.00 par value) 0.1
Preference shares (No shares issued) --
Total shareholders' equity 0.1
==============
$'000
Convertible notes 400,000
Total indebtedness 400,000
===============
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DESCRIPTION OF THE ORDINARY SHARES
Shire is a public limited company incorporated under the laws of England
and Wales. As of November 5, 2001, there were 479,367,095 ordinary shares
(including ordinary shares represented by ADSs) outstanding. This summary does
not purport to be complete and is qualified in its entirety by reference to our
full memorandum and articles of association. In this section, references to
"we," "us" and "our" refer solely to Shire Pharmaceuticals Group plc and not its
subsidiaries.
General
All of our issued ordinary shares are fully paid or credited as fully paid,
and therefore no holder of ordinary shares will be required to make additional
contributions of capital in respect of the shares in the future.
Share Capital
The provisions of Section 89(1) of the Companies Act 1985 confer on
shareholders rights of pre-emption in respect of the allotment of equity
securities, as defined in Section 94(2) of the Company Act 1985, which are, or
are to be, paid up wholly in cash, other than by way of allotment to employees
under an employees' share scheme, as defined in Section 743 of the Companies Act
1985. This section applies to our authorized but unissued share capital, to the
extent not disapplied in accordance with Section 95 of the Companies Act 1985.
The provisions of Section 89 of the Companies Act 1985 may be disapplied by a
special resolution of the shareholders, either generally or specifically, for a
maximum period not exceeding five years.
By ordinary resolution passed on July 7, 2000, the directors were generally
and unconditionally authorized to exercise all powers to allot relevant
securities, within the meaning of Section 80 of the Companies Act 1985, up to an
aggregate nominal amount of (pound)4,197,625.90. This authority expires on the
fifth anniversary of the date of the passing of the resolution. However, we may
make offers or agreements before the expiration, which would or might require
relevant securities to be allotted after the expiration, and the directors may
allot relevant securities in pursuance of the offers or agreements as if the
authority conferred by that resolution had not expired.
By a special resolution passed at the same annual general meeting on July
7, 2000, subject to the resolution referred to above and in addition and without
prejudice to all existing authorities, the directors were empowered pursuant to
Section 95 of the Companies Act 1985 to allot equity securities (within the
meaning of Section 94(2) of the Companies Act 1985) pursuant to the authority
conferred upon them above as if Section 89(1) of the Companies Act 1985 did not
apply to such allotment, provided that this power: (i) should expire five years
after the date of the passing of the resolution, save that we might make an
offer or agreement which would or might require equity securities to be allotted
after such expiry, and the directors might allot equity securities pursuant to
any such offer or agreement as if the power conferred by this resolution had not
expired; (ii) should be limited to allotment of equity securities to raise funds
solely for the purposes of repaying in whole or in part any outstanding amounts
under the facility agreement entered into on November 19, 1999, as amended,
between, inter alia, us and our subsidiaries in the United States as borrowers
and DLJ Capital Funding, Inc. as agent; and (iii) should not involve the
allotment of more than (pound)430,000 in nominal value of equity securities.
By special resolution passed on March 29, 2001, the directors were
empowered under Section 95 of the Companies Act 1985 to allot equity securities
under the authority referred to in the paragraph below, as if Section 89(1) of
the Companies Act 1985 did not apply to any of these allotments, provided that
this power is limited to:
o the allotment of equity securities where such securities have been
offered (whether by way of a rights issue, open offer or other
pre-emptive offer) to holders of ordinary shares in proportion (as
nearly as may be) to their existing holdings of ordinary shares but
subject to the directors having a right to make such exclusions or
other arrangements in connection with such offering as they may deem
necessary or expedient:
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- to deal with equity securities representing fractional
entitlements;
- to deal with ordinary shares represented by depository receipts;
and
- to deal with legal or practical problems under the laws of, or
the requirements of any recognized regulatory body or any stock
exchange in, any territory; and
o allotments of equity securities for cash otherwise than pursuant to
the preceding bullet point up to an aggregate nominal amount of
approximately (pound)1,279,868.
This power expires on the fifth anniversary of the date of the resolution,
except that we may before this expiration make an offer or agreement that would
or might require equity securities to be allotted after the expiration and the
directors may allot equity securities under the offer or agreement as if that
power had not expired.
The directors have undertaken that, to the extent that the aggregate
nominal amount of relevant securities (within the meaning of Section 80 of the
Companies Act 1985) up to which the directors are generally and unconditionally
authorized for the purposes of Section 80 and Section 95 of the Companies Act
1985 to allot such relevant securities exceeds IPC guidelines, the directors
shall not allot relevant securities pursuant to any outstanding authorities.
Dividends
Subject to the Companies Act 1985 and other applicable law and the articles
of association, we may by ordinary resolution from time to time declare
dividends to be paid to shareholders according to their rights and interests in
the profits available for distribution, but no dividend shall be declared in
excess of the amount recommended by the board of directors. Except insofar as
the rights attaching to, or the terms of issue of, any of our shares otherwise
provide, all dividends shall be apportioned and paid proportionately according
to the amounts paid on the shares during any portion or portions of the period
in respect of which the dividend is paid, but no amount paid up on a share in
advance of a call shall be treated as paid up on the share for this purpose. The
board of directors may from time to time and subject to the Companies Act 1985
and other applicable laws also pay to the shareholders an amount of interim
dividends that the board of directors considers to be justified by our profits
available for distribution. Our board of directors may, with the prior authority
of an ordinary resolution, direct that payment of any dividend may be satisfied
wholly or in part by the distribution of specific assets and, in particular, of
paid up shares or debentures of another company. The board may, if authorized by
an ordinary resolution, allot to those holders of a particular class of shares
who have elected to receive further shares of that class or ordinary shares, in
either case, credited as fully paid, instead of cash in respect of all or part
of a dividend or dividends specified by the resolution, subject to any
exclusions, restrictions or other arrangements which the board may in its
absolute discretion deem necessary or expedient. Any dividend unclaimed for a
period of 12 years from the date such dividend was declared or became due for
payment shall be forfeited and shall cease to remain owing by us.
No dividend shall be paid otherwise than out of the profits available for
distribution under the provisions of the Companies Act 1985.
Where a person is, under the provisions as to the transmission of shares
contained in the articles of association, entitled to become a shareholder, the
board may at any time serve a notice on this person requiring him to elect
either to be registered himself or to have a person nominated by him registered
as a member. If the notice is not complied with within 60 days, the board may
withhold payment of all dividends payable in respect of these shares until the
requirements of the notice have been complied with. Where any person has an
interest of 0.25% or more in the nominal value of shares of a particular class
in us, the board may withhold dividends payable on shares held by this person if
there has been a failure to provide us with information concerning interests on
those shares required to be provided under the articles of association and the
Companies Act 1985 until this failure has been remedied.
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Rights in a Winding-Up
On a voluntary winding-up, the liquidator may, on obtaining any sanction
required by law, divide among the shareholders in kind the whole or any part of
our assets, whether they shall consist of property of the same kind or not, and,
for that purpose, set those values as the liquidator determines fair upon any
property to be divided and determine how the division shall be carried out as
between the shareholders or different classes of shareholders. The liquidator
may not, however, distribute to a member, without his consent, any asset to
which there is attached a liability or potential liability for the owner.
Shareholder Meetings
An annual general meeting of shareholders must be held once each year
within a period of not more than 15 months after the date of the last preceding
annual general meeting. The board of directors may convene an extraordinary
general meeting of shareholders at its discretion. General meetings may be held
at the time and place as may be determined by the board of directors. An annual
general meeting shall be convened on at least 21 clear days' written notice to
shareholders entitled to receive notices. Most extraordinary general meetings
may be convened on at least 14 clear days' written notice, but extraordinary
general meetings at which it is proposed to pass special resolutions must be
convened on at least 21 clear days' written notice. Two shareholders entitled to
vote must be present in person or by proxy to constitute a quorum for all
purposes at general meetings except that the absence of a quorum shall not
prevent the appointment of a chairman of the meeting in accordance with the
articles of association.
Voting Rights
Subject to any special rights, terms or restrictions as to voting upon
which shares may be issued or held or any suspension or abrogation of voting
rights pursuant to the provisions of the articles of association (including in
circumstances where a statutory notice requiring disclosure of beneficial
ownership of shares has not been complied with), every shareholder present in
person at a general meeting shall have one vote on a show of hands, and on a
poll every shareholder present in person or by proxy shall have one vote for
every ordinary share of which he is the holder. No shareholder shall, unless
otherwise authorized by the board of directors, be entitled to be present or
vote at any of our general meetings or at any separate general meeting of the
holders of any class of our shares unless all calls or other sums presently
payable by the shareholder in respect of our shares have been paid. See also
"--Disclosure of Interests" and "--Special Voting Shares" below.
Voting at any general meeting of shareholders is by a show of hands unless
a poll is duly demanded. A poll may be demanded by:
o the chairman of the meeting;
o not less than five shareholders present in person or by proxy entitled
to vote at the meeting;
o any shareholder or shareholders present in person or by proxy and
representing in aggregate not less than one-tenth of the total voting
rights of all shareholders entitled to attend and vote at the meeting;
or
o any shareholder or shareholders present in person or by proxy holding
shares conferring a right to attend and vote at the meeting on which
shares there have been paid sums in the aggregate equal to not less
than one-tenth of the total sum paid on all the shares conferring that
right.
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Voting rights are only conferred on registered holders of shares and
therefore a person holding through a nominee may not directly demand a poll.
This includes holders of ADSs, as they are not registered holders of shares.
Unless otherwise required by law or the articles of association, voting in
a general meeting is by ordinary resolution. These resolutions include:
o the election of directors;
o the approval of financial statements;
o the declaration of final dividends;
o the appointment of auditors;
o the increase of authorized share capital; and
o the grant of authority to issue shares.
An ordinary resolution requires the affirmative vote of a majority of the
votes of those who are eligible to vote and vote in person in the case of
individuals or are represented by duly authorized representatives in the case of
corporations. If a poll is demanded, the affirmative vote of shareholders who
are present in person or by proxy in the case of individuals or are represented
by duly authorized representatives in the case of corporations and who in the
aggregate hold shares conferring a majority of the votes actually cast on the
resolution is required. A special resolution or an extraordinary resolution
requires the affirmative vote of not less than three-fourths of those who are
eligible to vote and vote in person in the case of individuals or are
represented by duly authorized representatives in the case of corporations. If a
poll is demanded, the affirmative vote of shareholders who are present in person
or by proxy in the case of individuals or are represented by duly authorized
representatives in the case of corporations and who in the aggregate hold shares
conferring three-fourths of the votes actually cast on the resolution is
required. Examples of special resolutions include resolutions relating to
matters concerning an alteration of our memorandum or articles of association or
a members' voluntary winding-up of us or the disapplication of statutory
preemption rights in respect of the issuance of equity securities to be paid up
wholly in cash. An example of an extraordinary resolution is one which modifies
the rights of any class of shares at a meeting of the holders of such class. The
chairman of the meeting has a second or deciding vote in the case of a tied
vote.
Authorization to Issue Shares
The Companies Act 1985 provides that the directors may be authorized by
means of an ordinary resolution of the shareholders to issue up to the maximum
number of ordinary shares designated in such resolution for a maximum period not
exceeding five years, although generally in the case of companies whose shares
are admitted to the Official List of the U.K. Listing Authority and to trading
on the LSE, these authorizations expire and are renewed at the same time as the
disapplication of pre-emptive rights. See "--Share Capital" above.
Variation of Rights
If at any time our share capital is divided into different classes of
shares, the rights attached to any class may be varied or abrogated, subject to
the provisions of the Companies Act 1985, in the manner as may be provided by
those rights or, in the absence of such a provision, either with the written
consent of the holders of at least three-fourths of the nominal amount of the
issued shares of the class or with the sanction of any extraordinary resolution
passed at a separate general meeting of the holders of the issued shares of that
class but not otherwise. At every such separate meeting, the quorum shall be two
persons present in person holding or representing by proxy at least one-
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third in nominal amount of the issued shares of the class or, at an adjourned
meeting, any two holders of the shares in question whether present in person or
by proxy. The rights conferred upon the holders of any class of shares shall
not, unless expressly provided in the rights attached to those shares, be deemed
to be altered by the creation or issuance of further shares ranking equally with
or subsequent to those shares or by the purchase or redemption by us of our own
shares in accordance with the Companies Act 1985 and our articles of
association.
Alteration of Capital
Subject to the provisions of the Companies Act 1985 and to any special
rights previously conferred on the holders of any existing shares, any share may
be issued with or have attached to it such rights and restrictions as we may
determine by ordinary resolution or, if no resolution has been passed, as the
board of directors may decide. Redeemable shares may be issued subject to the
provisions of the Companies Act 1985 and to any rights conferred on the holders
of any class of existing shares.
We may by ordinary resolution:
o increase our share capital;
o consolidate and divide all or any of our share capital into shares of
a larger amount;
o subject to the provisions of the Companies Act 1985, subdivide all or
any of our shares into shares of a smaller nominal amount and decide
that the shares resulting from the subdivision have among themselves a
preference or other advantage or are subject to a restriction; and
o cancel any shares which have not been taken or agreed to be taken by
any person and diminish the amount of our authorized share capital by
the amount of the shares so canceled.
Subject to the provisions of the Companies Act 1985 and the rights attached
to existing shares, we may by special resolution reduce our authorized and
issued share capital, any capital redemption reserve and any share premium
account in any manner. We may also, subject to the requirements of the Companies
Act 1985 and to the rights conferred on holders of any class of shares, purchase
all or any of our own shares, including any redeemable shares.
Disclosure of Interests
Section 198 of the Companies Act 1985 provides that a person, including a
company and other legal entities, that acquires an interest of 3.0% or more of
any class of shares, including through ADRs, comprising part of a company's
issued share capital carrying the right to vote in all circumstances at a
general meeting of such company is required to notify the company in writing of
its interest within two days following the day on which the notification
obligation arises. After the 3.0% level is exceeded, similar notifications must
be made in respect of increases or decreases taking the shareholding above or
below a whole percentage figure. Interests held by some investment fund managers
may be disregarded for the purposes of calculating the 3.0% threshold, but the
disclosure obligation will still apply where those interests exceed 10% or more
of any class of our relevant share capital and to increases or decreases taking
the shareholding above or below a whole percentage figure after that time.
For purposes of the notification obligation, the interest of a person in
shares means any kind of interest in shares including an interest in any shares:
o in which a spouse, or child or stepchild under the age of 18 is
interested;
o in which a corporate body is interested and either
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- that corporate body or its directors are generally accustomed to
act in accordance with that person's directions or instructions,
or
- that person controls one-third or more of the voting power of
that corporate body; or
o in which another party is interested and the person and that other
party are parties to a "concert party" agreement under Section 204 of
the Companies Act 1985. An agreement is a "concert party" agreement
if:
- it provides for one or more parties to acquire interests in
shares of a particular company,
- it imposes obligations or restrictions on any one or more of the
parties as to the use, retention or disposal of the interests
acquired under the agreement and
- any interest in our shares is in fact acquired by any of the
parties under the agreement.
In addition, Section 212 of the Companies Act 1985 provides that a public
company may by written notice require a person whom the company knows or has
reasonable cause to believe to be, or to have been at any time during the three
years immediately preceding the date on which the notice is issued, interested
in shares comprised in the company's issued share capital carrying the right to
vote in all circumstances at a general meeting of such company to confirm that
fact or to indicate whether or not that is the case, and where such person holds
or during the relevant time had held an interest in those shares, to give such
further information as may be required relating to that interest and any other
interest in the shares of which that person is aware.
Where notice is served by a company under the foregoing provisions on a
person who is or was interested in shares of the company and that person fails
to give the company any information required by the notice within the time
specified in the notice, the company may apply to the English court for an order
directing that the shares in question be subject to restrictions prohibiting,
among other things, any transfer of those shares, the exercise of the voting
rights in respect of those shares, the taking up of rights in respect of those
shares and, other than in liquidation, payments in respect of those shares.
A person who fails to fulfill the obligation imposed by Sections 198 to 202
and 212 of the Companies Act 1985 described above is subject to criminal
penalties.
Share Acquisitions
The City Code on Takeovers and Mergers, issued and administered by the
Panel on Takeovers and Mergers in London, is applicable to us because we are a
public limited company incorporated and resident in England and Wales. The City
Code is intended to operate principally to ensure fair and equal treatment of
all shareholders in transactions involving companies to which it applies. When
persons hold or acquire certain percentages of voting rights of a U.K. public
company such as ours, these persons may be required, in certain circumstances,
to make an offer to all shareholders of that company for its shares. For
purposes of the City Code, the term persons includes all persons "acting in
concert" as that term is defined in the City Code.
Transfer of Shares
Any holder of certificated shares may transfer all or any of those shares
by an instrument of transfer in any usual form or in any other form approved by
the board. The instrument of transfer shall be signed by or on behalf of the
transferor and, in the case of a partly paid share, by or on behalf of the
transferee. The transferor shall remain the holder of the share until the name
of the transferee is entered in our register of members in respect of it.
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Subject to the articles of association and requirements of the LSE, the
directors may, in their absolute discretion and without assigning any reason,
refuse to register any transfer of certificated shares unless:
o it is in respect of a fully paid share; provided that where any nil
paid or partly paid shares are admitted to the Official List of the
U.K. Listing Authority, such discretion may not be exercised in such a
way as to prevent dealings in such shares taking place on an open and
proper basis;
o it is duly stamped, if required, is lodged with us and is accompanied
by the certificate for the shares to which it relates and such other
evidence as the directors may reasonably require to show the right of
the transferor to make the transfer;
o it is in respect of only one class of shares;
o it is in favor of not more than four transferees; and
o it is in respect of a share on which we have no liens.
Notwithstanding anything in the articles of association to the contrary,
any of our shares may be issued, held, registered, converted to, transferred or
otherwise dealt with in uncertificated form and converted from uncertificated
form to certificated form in accordance with The Uncertificated Securities
Regulations 1995 (SI 1995/3272) including any modification of and rules made
under those provisions or any regulations in substitution for those provisions
made under Section 207 of the Companies Act 1989 for the time being in force and
practices instituted by an operator of the relevant system. Any provision of the
articles of association shall not apply to any uncertificated shares to the
extent that those provisions are inconsistent with:
o the holding of shares in uncertificated form;
o the transfer of title of shares by means of a relevant system; or
o any provision of the regulations referred to in this paragraph.
Miscellaneous
There are currently no U.K. foreign exchange controls on the payment of
dividends on the ordinary shares or the conduct of our operations. There are no
restrictions under our memorandum and articles of association or under English
law that limit the right of non-resident or foreign owners to hold or vote our
ordinary shares. However, no shareholders are entitled to receive notices from
us, including notices of shareholders' meetings, unless they have given an
address in the United Kingdom to us to which those notices may be sent.
Notwithstanding the foregoing, we provide information to the depositary, which
in turn forwards that information to the holders of ADSs.
Special Voting Shares
17,292,149 special voting shares were authorized for issuance pursuant to
the merger agreement among us, BioChem and Shire Acquisition Inc., a corporation
incorporated under the laws of Canada and our wholly owned subsidiary, and,
pursuant to the plan of arrangement, these special voting shares were issued to
the trustee appointed under the voting and exchange trust agreement. These
special voting shares were created by the subdivision of such number of existing
authorized but unissued ordinary shares into special voting shares of a nominal
value of 0.00001p, as gave rise to such number of special voting shares as was
equal to the number of issued and outstanding exchangeable shares in Shire
Acquisition Inc. immediately after the effective date of the arrangement. The
trustee holds the special voting shares in trust for the benefit of the holders
of the exchangeable shares (other than us and
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our affiliates) and is able to vote in person or by proxy on any matters put
before our shareholders at a general meeting. Each holder of exchangeable shares
(other than us or our affiliates) is entitled to direct the trustee how to vote
three special voting shares for each exchangeable share owned by such holder or
to attend the meeting personally and vote directly as proxy for the trustee in
respect of such special voting shares. Unless instructed, the trustee may not
vote, and any exchangeable shares held by us or our affiliates may not be voted.
Such votes may be exercised for the election of directors and on all other
matters submitted to a vote of our shareholders. The holders of ordinary shares
and the holder of the special voting shares will vote together as a single class
on all matters, except to the extent voting as a separate class is required by
applicable laws or our memorandum and articles of association. The holder of the
special voting shares is not entitled to receive dividends from us and, in the
event of our winding up, will be entitled to receive an amount equal to the
higher of 1p and the par value thereof but only after holders of ordinary shares
have received an amount equal to the nominal amount of such shares held by them.
To the extent that exchangeable shares are exchanged for ordinary shares or ADSs
pursuant to, and on the terms of, the voting and exchange trust agreement, and
to the extent that there are no shares of stock, debt, options or other
agreements of Shire Acquisition Inc. that could give rise to the issuance of any
exchangeable shares to any person (other than us and our affiliates), the
trustee shall forfeit such number of special voting shares to us as corresponds
to the number of exchangeable shares thus exchanged.
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DESCRIPTION OF THE AMERICAN DEPOSITARY SHARES AND
AMERICAN DEPOSITARY RECEIPTS
In this section, references to "we," "us" and "our" refer solely to Shire
Pharmaceuticals Group plc and not its subsidiaries.
American Depositary Shares and American Depositary Receipts
Morgan Guaranty Trust Company of New York as depositary will issue the ADSs
which you may elect to receive pursuant to the conversion or redemption of the
notes and exchange of the preference shares. Each ADS will represent ownership
interest in three ordinary shares, which we will deposit with the custodian
under the deposit agreement among us, the depositary and yourself as an ADR
holder. In the future, each ADS will also represent any securities, cash or
other property deposited with the depositary but not distributed by it directly
to you. Your ADSs will be evidenced by what are known as ADRs. An ADR may be
issued in either book-entry or certificated form by the depositary. If an ADR is
issued in book-entry form, you will receive periodic statements from the
depositary showing your ownership interest in ADSs.
The depositary's office is located at 60 Wall Street, New York, New York
10260.
You may hold ADSs either directly or indirectly through your broker or
other financial institution. If you hold ADSs directly, you are an ADR holder.
This description assumes you hold your ADSs directly. If you hold the ADSs
through your broker or financial institution nominee, you must rely on the
procedures of that broker or financial institution to assert the rights of ADR
holders described in this section. You should consult with your broker or
financial institution to find out what those procedures are.
Because the depositary's nominee will actually be the registered owner of
the ordinary shares, you must rely on it to exercise the rights of a shareholder
on your behalf. The obligations of the depositary and its agents are set out in
the deposit agreement. The deposit agreement and the ADSs are generally governed
by New York law.
The following is a summary of the material terms of the deposit agreement.
Because it is a summary, it does not contain all the information that may be
important to you. For more complete information, you should read the entire
deposit agreement and the form of ADR which contains the terms of your ADSs. We
will make copies of the actual documents available to you upon request.
Share Dividends and Other Distributions
How will I receive dividends and other distributions on the ordinary shares
underlying my ADSs?
The depositary has agreed to pay to you the cash dividends or other
distributions it or the custodian receives on ordinary shares or other deposited
securities, after deducting its expenses. You will receive these distributions
in proportion to the number of underlying ordinary shares your ADSs represent.
We may make various types of distributions with respect to our securities.
Except as stated below, to the extent the depositary is legally permitted it
will deliver such distributions to ADR holders in proportion to their interests
in the following manner:
Cash. The depositary shall convert cash distributions from foreign currency
to U.S. dollars if this is permissible and can be done on a reasonable basis.
The depositary will endeavor to distribute such cash in a practicable manner and
may deduct any taxes required to be withheld, any expenses of converting foreign
currency and transferring funds to the United States and certain other expenses
and adjustments. In addition, before making a distribu-
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tion the depositary will deduct any taxes withheld. If the exchange rates
fluctuate during a time when the depositary cannot convert the currency, you may
lose all or part of the value of the distribution.
Ordinary shares. In the case of a distribution in ordinary shares, the
depositary will issue additional ADRs to evidence the number of ADSs
representing such ordinary shares. Only whole ADSs will be issued. Any ordinary
shares which would result in fractional ADSs will be sold, and the net proceeds
will be distributed to the ADR holders entitled thereto.
Rights to receive additional ordinary shares. In the case of a distribution
of rights to subscribe for additional ordinary shares or other rights, if we
provide satisfactory evidence that the depositary may lawfully distribute such
rights, the depositary may arrange for ADR holders to instruct the depositary as
to the exercise of such rights. However, if we do not furnish such evidence, the
depositary may
- sell such rights if practicable and distribute the net proceeds as
cash, or
- allow such rights to lapse, whereupon ADR holders will receive
nothing.
We have no obligation to file a registration statement under the Securities
Act in order to make any rights available to ADR holders.
Other distributions. In the case of a distribution of securities or
property other than those described above, the depositary may either
- distribute such securities or property in any manner it deems fair and
equitable or
- sell such securities or property and distribute any net proceeds in
the same way it distributes cash.
Any U.S. dollars will be distributed by checks drawn on a bank in the
United States for whole dollars and cents. Fractional cents will be withheld
without liability for interest and added to future cash distributions.
The depositary may choose any practical method of distribution for any
specific ADR holder, including the distribution of foreign currency, securities
or property, or it may retain the item, without paying interest on or investing
it, on behalf of the ADR holder as deposited securities.
The depositary may not be able to convert any currency at a specified
exchange rate or sell any property, rights, shares or other securities at a
specified price. We cannot assure you that any of such transactions can be
completed within a specified time period.
Deposit, Withdrawal and Cancellation
How does the depositary issue ADSs?
The depositary will issue ADSs if you deposit or your broker deposits
ordinary shares or evidence of rights to receive ordinary shares with the
custodian. In the case of the ADSs to be issued following the exchange of
preference shares of the issuer, we will arrange to deposit such ordinary
shares.
Ordinary shares deposited in the future with the custodian must be
accompanied by certain documents, including instruments showing that such
ordinary shares have been properly transferred or endorsed to the person on
whose behalf the deposit is being made.
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The custodian will hold all deposited ordinary shares for the account of
the depositary. This includes those ordinary shares being deposited by or on
behalf of us in connection with the exchange of preference shares of the issuer.
ADR holders thus have no direct ownership interest in the ordinary shares and
only have the rights that are contained in the deposit agreement. The custodian
will also hold any additional securities, property and cash received on or in
substitution for the deposited ordinary shares. The deposited ordinary shares
and any such additional items are referred to as "deposited securities."
Upon each deposit of ordinary shares, receipt of related delivery
documentation and compliance with the other provisions of the deposit agreement,
including the payment of the fees and charges of the depositary, the depositary
will issue an ADR or ADRs in the name of the person entitled thereto evidencing
the number of ADSs to which such person is entitled. Certificated ADRs will be
delivered at the depositary's principal New York office or any other location
that it may designate as its transfer office. If ADRs are in book-entry form, a
statement setting forth such ownership interest will be mailed to holders by the
depositary. All of the ADSs issued other than following the exchange of
preference shares of the issuer will, unless specifically requested to the
contrary, be part of the depositary's book-entry direct registration system, and
registered holders will receive periodic statements from the depositary which
will show the number of ADSs registered in such holder's name. An ADR holder can
always request that the ADSs not be held through the depositary's direct
registration system and that a certificated ADR be issued.
How do ADR holders cancel an ADS and obtain deposited securities?
When you turn in your ADS at the depositary's office, it will, upon payment
of certain applicable fees, charges and taxes, deliver at the custodian's office
the underlying ordinary shares. At your risk, expense and request, the
depositary may deliver at another place that you may request.
The depositary may only restrict the withdrawal of deposited securities in
connection with:
o temporary delays caused by closing transfer books of the depositary or
us, the deposit of ordinary shares in connection with voting at a
shareholders' meeting or the payment of dividends;
o the payment of fees, taxes and similar charges; or
o compliance with any U.S. or foreign laws or governmental regulations
relating to the ADRs.
This right of withdrawal may not be limited by any other provision of the
deposit agreement.
Voting Rights
How do I vote?
If you are an ADR holder and the depositary asks you to provide it with
voting instructions, you may instruct the depositary how to exercise the voting
rights for the ordinary shares which underlie your ADSs. After receiving voting
materials from us, the depositary will notify all of the ADR holders of any
shareholder meeting or solicitation of consents or proxies. This notice will
describe how you may instruct the depositary to exercise the voting rights for
the ordinary shares which underlie your ADSs. For instructions to be valid, the
depositary must receive them on or before the date specified. The depositary
will try, as far as practical, subject to the provisions of and governing the
underlying ordinary shares or other deposited securities, to vote or to have its
agents vote the ordinary shares or other deposited securities as you instruct.
The depositary will only vote or attempt to vote as you instruct. The depositary
will not itself exercise any voting discretion. Furthermore, neither the
depositary nor its agents are responsible for any failure to carry out any
voting instructions, for the manner in which any vote is cast or for the effect
of any vote.
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Because there is no guarantee that you will receive voting materials in
time to instruct the depositary to vote, it is possible that you, or persons who
hold their ADSs through brokers, dealers or other third parties, will not have
the opportunity to exercise a right to vote.
Fees and Expenses
What fees and expenses will I be responsible for paying?
ADR holders will be charged a fee for each issuance of ADSs, including
without limitation upon issuances resulting from distributions of shares, rights
and other property, and for each surrender of ADSs in exchange for deposited
securities, except that we will pay such fee for each initial issuance of ADSs
in exchange for preference shares. The fee in each case is $5.00 for each 100
ADSs or any portion thereof issued or surrendered. ADR holders or persons
depositing ordinary shares may also be charged the following expenses:
o stock transfer or other taxes and other governmental charges;
o cable, telex and facsimile transmission and delivery charges;
o transfer or registration fees for the registration of transfer of
deposited securities on any applicable register in connection with the
deposit or withdrawal of deposited securities; and
o expenses of the depositary in connection with the conversion of
foreign currency into U.S. dollars.
We will pay all other charges and expenses of the depositary and any agent
of the depositary pursuant to agreements from time to time between us and the
depositary. However, we will not pay any charges and expenses of the custodian.
The fees described above may be amended from time to time.
Payment of Taxes
ADR holders must pay any tax or other governmental charge payable by the
custodian or the depositary on any ADS or ADR, deposited security or
distribution. However, except as provided below, if you deliver a note for
conversion and exchange, you will not be required to pay any U.K. transfer taxes
or duties in respect of the issue of ADSs in exchange for the preference shares.
Instead, we will hold you harmless against any U.K. stamp duty or stamp duty
reserve tax liability you may be required to pay on exchange. We will not pay
any tax or duty, however, that may be payable in respect of any transfer
involved in the issue or delivery of our ADSs in a name other than that of the
holder of the note. If an ADR holder owes any tax or other governmental charge,
the depositary may
o deduct the amount thereof from any cash distributions or
o sell deposited securities and deduct the amount owing from the net
proceeds of such sale.
In either case the ADR holder remains liable for any shortfall.
Additionally, if any tax or governmental charge is unpaid, the depositary
may also refuse to effect any registration, registration of transfer, split-up
or combination of deposited securities or any withdrawal of deposited
securities, except under limited circumstances mandated by securities
regulations. If any tax or governmental charge is required to be withheld on any
non-cash distribution, the depositary may sell the distributed property or
securities to pay these taxes or charges and distribute any remaining net
proceeds to the ADR holders entitled thereto.
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Reclassifications, Recapitalizations and Mergers
If we take certain actions that affect the deposited securities, including:
o any change in par value, split-up, consolidation, cancellation or
other reclassification of deposited securities; or
o any recapitalization, reorganization, merger, consolidation,
liquidation, receivership, bankruptcy or sale of all or substantially
all of our assets,
then the depositary may choose to:
(1) amend the form of ADR;
(2) distribute additional or amended ADRs;
(3) distribute cash, securities or other property it has received in
connection with such actions;
(4) sell any securities or property received and distribute the proceeds
as cash; or
(5) none of the above.
If the depositary does not choose any of (1) through (4), any of the cash,
securities or other property it receives shall constitute part of the deposited
securities and each ADS will then represent a proportionate interest in such
property.
Amendment and Termination
How may the deposit agreement be amended?
We may agree with the depositary to amend the deposit agreement and the
ADSs without your consent for any reason. ADR holders must be given at least 30
days' notice of any amendment that imposes or increases any fees or charges,
other than taxes and other charges specifically payable by ADR holders under the
deposit agreement, or affects any substantial existing right of ADR holders. If
an ADR holder continues to hold ADRs or ADSs after being so notified, the ADR
holder will be deemed to have agreed to the amendment. An amendment can become
effective before notice is given if effectiveness is necessary to ensure
compliance with a new law, rule or regulation.
No amendment will impair your right to surrender your ADSs and receive the
underlying securities. If a governmental body adopts new laws or rules which
require the deposit agreement or ADS to be amended, we and the depositary may
make the necessary amendments, which could take effect before you receive notice
of the amendments.
How may the deposit agreement be terminated?
The depositary may terminate the deposit agreement by giving ADR holders at
least 30 days prior notice, and it must do so at our request. After termination,
the depositary's only responsibility will be
o to deliver deposited securities to ADR holders who surrender their
ADRs and
o to hold or sell distributions received on deposited securities.
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As soon as practicable after the expiration of six months from the
termination date, the depositary will sell the deposited securities which remain
and hold the net proceeds of such sales, without liability for interest, in
trust for ADR holders who have not yet surrendered their ADRs. After making a
sale, the depositary shall have no obligations except to account for the
proceeds and other cash.
Limits on Our Obligations and the Obligations of the Depositary; Limits
on Liability to ADR Holders and Holders of ADSs
The deposit agreement expressly limits the obligations and liability of
each of the depositary, us and its and our respective agents. Neither we nor the
depositary will be liable:
o if we or the depositary is prevented or hindered in performing any
obligation by circumstances beyond its control, including, without
limitation, requirements of law, rule, regulation, the terms of the
deposited securities and acts of God;
o for exercising or failing to exercise discretion under the deposit
agreement;
o if we perform our or the depositary performs its obligations without
gross negligence or bad faith; or
o for any action based on advice or information from legal counsel,
accountants, any person presenting ordinary shares for deposit, any
holder or any other qualified person.
Neither the depositary nor its agents have any obligation to appear in,
prosecute or defend any action, suit or other proceeding in respect of any
deposited securities or the ADRs. We and our agents shall only be obligated to
appear in, prosecute or defend any action, suit or other proceeding in respect
of any deposited securities or the ADRs, which in our opinion may involve us in
expense or liability, if indemnity satisfactory to us against all expense,
including fees and disbursements of counsel, and liability be furnished as often
as we require.
The depositary will not be responsible for failing to carry out
instructions to vote the ADSs or for the manner in which the ADSs are voted or
the effect of the vote.
The depositary may own and deal in securities and in ADSs.
Requirements for Depositary Actions
We, the depositary or the custodian may refuse to
o issue, register or transfer an ADR or ADRs,
o effect a split-up or combination of ADRs,
o deliver distributions on any such ADRs or
o unless the deposit agreement provides otherwise, permit the withdrawal
of deposited securities, until the following conditions have been met:
- the holder has paid all taxes, governmental charges and fees and
expenses as required in the deposit agreement;
- the holder has provided the depositary with any information it
may deem necessary or proper, including, without limitation,
proof of identity and the genuineness of any signature; and
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- the holder has complied with the regulations that the depositary
may establish under the deposit agreement.
Unless the deposit agreement provides otherwise, the depositary may also
suspend the issuance of ADSs, the deposit of ordinary shares, the registration,
transfer, split-up or combination of ADRs or the withdrawal of deposited
securities if the register for ADRs or any deposited securities is closed or if
the depositary or we decide any such action is advisable.
Pre-release of ADSs
The depositary may also issue ADRs prior to the deposit with the custodian
of ordinary shares or rights to receive ordinary shares. This is called a
pre-release of the ADS. A pre-release is closed out as soon as the underlying
ordinary shares are delivered to the depositary. The depositary may pre-release
ADSs only if:
o the depositary has received collateral for the full market value of
the pre-released ADRs; and
o each recipient of pre-released ADRs agrees in writing that he or she
- owns the underlying ordinary shares,
- assigns all rights in such ordinary shares to the depositary,
- holds such ordinary shares for the account of the depositary and
- will deliver such ordinary shares to the custodian as soon as
practicable, and promptly if the depositary so demands.
In general, the number of pre-released ADSs will not evidence more than 30%
of all ADSs outstanding at any given time, excluding those evidenced by
pre-released ADRs. However, the depositary may change or disregard such limit
from time to time in certain circumstances.
The Depositary
Who is the depositary?
Morgan Guaranty Trust Company of New York, a New York banking corporation,
is a commercial bank offering a wide range of banking and trust services to its
customers in the New York metropolitan area, throughout the United States and
around the world.
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CERTAIN CAYMAN ISLANDS, U.K. AND U.S. TAX CONSIDERATIONS
This summary is of a general nature and is included herein solely for
informational purposes. It is not intended to be, nor should it be construed to
be, legal or tax advice. No representation with respect to the consequences to
any particular purchaser of the book-entry interests is made hereby. Prospective
purchasers should consult their own tax advisers with respect to their
particular circumstances and the effects of national, state or local tax laws to
which they may be subject.
In this section, references to "Shire," "we," "us" or "our" refer solely to
Shire Pharmaceuticals Group plc and not its subsidiaries, and references to the
"issuer" refer solely to Shire Finance Limited.
Cayman Islands Tax Considerations
The Cayman Islands currently have no exchange control restrictions and no
income, corporate or capital gains tax, estate duty, inheritance tax, gift tax
or withholding tax applicable to Shire Finance Limited or any holder of notes.
Accordingly, payment of principal of (including any premium) and interest on,
and any transfer or conversion of, the notes will not be subject to taxation in
the Cayman Islands, no Cayman Islands withholding tax will be required on such
payments to any holder of a note and gains derived from the sale of notes or
shares will not be subject to Cayman Islands capital gains tax. The Cayman
Islands are not party to any double taxation treaties.
Shire Finance Limited has applied for and expects to receive an undertaking
from the Governor-in-Council of the Cayman Islands that, in accordance with
Section 6 of the Tax Concessions Law (Revised) of the Cayman Islands for a
period or 20 years from the date of the undertaking, no law which is enacted in
the Cayman Islands imposing any tax to be levied on profits or income or gains
or appreciation shall apply to Shire Finance Limited or its operations and that
the aforesaid tax or any tax in the nature of estate duty or inheritance tax
shall not be payable on the notes, the preference shares, debentures or other
obligations of Shire Finance Limited.
No stamp duties or similar taxes or charges are payable under the laws of
the Cayman Islands in respect of the execution and issue of the notes unless
they are executed in or brought within (for example, for the purposes of
enforcement) the jurisdiction of the Cayman Islands, in which case stamp duty of
0.25% of the face amount thereof may be payable on each note (up to a maximum of
CI$250) unless Shire Finance Limited has paid stamp duty of CI$500 in respect of
the entire issue of notes. An instrument of transfer in respect of a note if
executed in or brought within the jurisdiction of the Cayman Islands will
attract a Cayman Islands stamp duty of CI$100. No stamp duties or similar taxes
or charges are payable under the laws of the Cayman Islands in respect of the
conversion of the notes or the issue of the preference shares.
U.K. Tax Considerations
The comments below are of a general nature based on current U.K. law and
practice. They do not necessarily apply where the income is deemed for tax
purposes to be the income of any other person. They relate only to the position
of persons who are the absolute beneficial owners of their notes and may not
apply to certain classes of persons such as dealers. They assume that the notes
will be listed on a recognized stock exchange within the meaning of Section 841
of the Income and Corporation Taxes Act 1988 before any payment of interest is
made on the notes. They also assume that holders of ADRs representing ADSs will
be treated in practice as the beneficial owners of the ordinary shares
represented by the ADSs for the purpose of U.K. tax. Any noteholders who are in
doubt as to their personal tax position should consult their professional
advisers.
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1. Interest
1.1. While the notes continue to be listed on a recognized stock exchange
within the meaning of Section 841 of the Income and Corporation Taxes
Act 1988, payments of interest (including payments of interests made
through paying or collecting agents) may be made without withholding
or deduction for or on account of income tax.
Persons in the United Kingdom paying interest to or receiving interest
on behalf of another person may be required to provide certain
information to the U.K. Inland Revenue regarding the identity of the
payee or person entitled to the interest and, in certain
circumstances, such information may be exchanged with tax authorities
in other countries.
If the notes cease to be listed, interest will generally be paid under
deduction of income tax at the lower rate (currently 20%). The terms
and conditions of the notes do not provide for any additional payments
to be made in this or any other situation. Noteholders who are not
resident in the United Kingdom may, however, be able to recover all or
part of the tax deducted if there is an appropriate provision in an
applicable double tax treaty and where such a treaty applies a
direction may be given in advance by the Inland Revenue to enable the
interest to be paid without deduction of withholding tax.
1.2. The interest has a U.K. source and accordingly may be chargeable to
U.K. tax by direct assessment. Where the interest is paid without
withholding or deduction, the interest will not be assessed to U.K.
tax in the hands of holders of the notes who are not resident in the
U.K., except where such persons carry on a trade, profession or
vocation in the United Kingdom through a U.K. branch or agency in
connection with which the interest is received or to which the notes
are attributable, in which case (subject to exemptions for interest
received by certain categories of agent) tax may be levied on the U.K.
branch or agency.
Noteholders should again note that since the terms and conditions of
the notes do not provide for additional payments to be made in any
circumstances, no additional payments would be made even if the Inland
Revenue sought to assess U.K. tax directly on the person entitled to
the relevant interest. However, exemption from or reduction of such
U.K. tax liability might be available under an applicable double
taxation treaty.
1.3. Where interest has been paid under deduction of U.K. tax (for example,
if the notes lost their listing), noteholders who are not resident in
the United Kingdom may be able to recover all or part of the tax
deducted if there is an appropriate provision in an applicable double
taxation treaty.
1.4. Noteholders within the charge to U.K. corporation tax will be subject
to tax as income on interest arising in respect of the notes broadly
in accordance with their statutory accounting treatment. Such
noteholders will generally be charged in each accounting period by
reference to interest which, in accordance with such noteholder's
authorized accounting method, is applicable to that period.
1.5. Noteholders who are not subject to U.K. corporation tax but who are
subject to U.K. income tax will generally be subject to income tax on
interest arising in respect of the notes on a receipt basis.
1.6. The European Union is currently considering proposals for a new
directive regarding the taxation of savings income. Subject to a
number of important conditions being met, it is proposed that Member
States will be required to provide to the tax authorities of another
Member State details of payments of interest or other similar income
paid by a person within its jurisdiction to an indi-
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vidual resident in that other Member State, subject to the right of
certain Member States to opt instead for a withholding system for a
transitional period in relation to such payments.
2. Disposal (including Redemption), Conversion or Exchange
2.1. Non-U.K. Resident Noteholders
Noteholders who are not resident or ordinarily resident for tax
purposes in the United Kingdom and who do not carry on a trade,
profession or vocation in the United Kingdom through a branch or
agency to which the notes are attributable are outside the charge to
U.K. taxation on chargeable gains with respect to the disposal of the
notes, conversion of the notes into preference shares and the exchange
of the latter for ordinary shares or ADSs.
2.2. Noteholders Within the Charge to U.K. Corporation Tax
2.2.1. Disposal
Except in respect of amounts relating to interest on the notes, a
noteholder within the charge to U.K. corporation tax will not be
subject to tax on any profits in respect of the notes as income. The
notes will, however, be treated as "chargeable assets" for the
purposes of the U.K. taxation of chargeable gains. Accordingly, a
disposal of notes may give rise to a chargeable gain or allowable
loss. In calculating any gain or loss on disposal of a note, sterling
values are compared at acquisition and transfer. Accordingly, a
taxable profit can arise even where the foreign currency amount
received on a disposal is less than or the same as the amount paid for
the notes. It follows that notes will not be "qualifying assets" for
the purpose of the foreign exchange provisions contained in Finance
Act 1993.
For the purposes of the taxation of chargeable gains, the
consideration for any disposal or acquisition of the notes will be
treated as adjusted so as to exclude, on a just and reasonable basis,
the amount of such consideration which relates to interest which has
accrued but has not been paid as at the date of such disposal or
acquisition.
2.2.2. Conversion
Conversion of the notes should not be treated as a disposal of the
notes (except for the purpose of the adjustment for accrued interest
above) and should not of itself give rise to a charge to U.K. taxation
of chargeable gains.
2.2.3. Exchange
The exchange of the preference shares of the issuer for the ordinary
shares or ADSs of Shire should not be treated as occasioning a
disposal of the preference shares by, and accordingly should not give
rise to a chargeable gain for, those holders of the preference shares
who, either alone or together with persons connected with them, do not
hold more than 5% of, or of any class of, the shares in or debentures
of the issuer. Any chargeable gain or allowable loss which would
otherwise have arisen on a disposal of the preference shares will be
"rolled over" into the ordinary shares or ADSs, and the ordinary
shares or ADSs will be treated as the same asset as the preference
shares, acquired at the same time and for the same consideration as
the preference shares.
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A holder of preference shares who, either alone or together with
persons connected with him, holds more than 5% of, or of any class of,
the shares in or debentures of the issuer will be treated in the
manner described in the preceding paragraph with respect to the
exchange, provided that the exchange is effected for bona fide
commercial reasons and does not form part of a scheme or arrangements
of which the main purpose, or one of the main purposes, is avoidance
of liability to capital gains tax or corporation tax. Such holders of
preference shares should note that an application for clearance has
not been made in this regard to the Inland Revenue under Section 138
of the Taxation of Chargeable Gains Act 1992. Noteholders should also
note that, because exchanges of preference shares will take place at
different times, a noteholder holding less than 5% of the notes may
hold more than 5% of the preference shares at the time of exchange.
2.2.4. If Shire exercises the cash-out option, a holder of preference
shares will be treated as disposing of his preference shares. A
disposal by a holder within the charge to U.K. corporation tax may
give rise to a chargeable gain or allowable loss. In calculating any
gain or loss on disposal of the preference shares, sterling values are
compared at acquisition and transfer. Accordingly, a taxable profit
can arise even where the foreign currency amount received on a
disposal is less than or the same as the amount paid for the notes.
2.2.5. Proposed Change in Law
Noteholders within the charge to U.K. corporation tax should note that
a consultative document issued by the Inland Revenue on 26th July,
2001 contains proposed legislation which would, if implemented in its
current form, have the effect that many of the statements made in
paragraphs 2.2.1 to 2.2.4 above will not apply. In particular, under
the proposed legislation, a noteholder within the charge to U.K.
corporation tax:
(a) will be subject to tax on all profits on the notes as income
(broadly in accordance with its statutory accounting treatment);
(b) on conversion and exchange, will be treated for the purposes of
computing its profits that are subject to U.K. corporation tax as
income as disposing of the relevant notes for their market value
at the time of conversion and exchange; and
(c) on conversion and exchange, will be treated for the purposes of
U.K. corporation tax on chargeable gains as acquiring its
ordinary shares or ADSs of Shire for an amount equal to the
market value of the relevant notes at the time of conversion and
exchange.
It is quite possible that the form of this legislation may change
prior to its enactment. Noteholders within the charge to U.K.
corporation tax should consult their own tax advisors as to the effect
of the proposed change in law.
2.3. Other Noteholders
2.3.1. Disposal
A disposal of a note by a noteholder resident or ordinarily resident
for tax purposes in the United Kingdom
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or who carries on a trade, profession or vocation in the United
Kingdom through a branch or agency to which the note is attributable
may give rise to a chargeable gain or allowable loss for the purposes
of taxation of capital gains. In calculating any gain or loss on
disposal of a note, sterling values are compared at acquisition and
transfer. Accordingly, a taxable profit can arise even where the
foreign currency amount received on a disposal is less than or the
same as the amount paid for the note.
The provisions of the accrued income scheme contained in Chapter II of
Part XVII of the Income and Corporation Taxes Act 1988 (the "scheme")
may apply on the transfer of a note by a holder and may apply to a
person to whom the note is transferred. Generally, persons who are
neither resident nor ordinarily resident in the United Kingdom and
dealers in securities will not be subject to the provisions of the
scheme. On a transfer of securities with accrued interest, the scheme
would normally deem the transferor to receive an amount of income
equal to the accrued interest and deem the transferee to obtain an
equivalent credit to set against the deemed or actual interest he
subsequently receives. However, as the notes arguably bear a variable
interest rate, the amount of accrued income deemed to be received by a
holder upon the transfer of a note may be such amount as the Inland
Revenue decides is just and reasonable and the purchaser of a note may
not be entitled to any equivalent credit under the scheme to set
against any deemed or actual interest in respect of the notes except
to the extent that the absence of any such credit is taken into
account in the application of the just and reasonable basis of charge
on disposal. In addition, on a redemption of the notes, interest which
is deemed to have accrued since the interest payment date preceding
redemption could be chargeable to U.K. tax as income under the scheme.
2.3.2. Conversion
(i) The scheme
On a conversion, interest which is deemed to have accrued since the
last interest payment date may be chargeable to U.K. tax as income
under the scheme even though on conversion accrued interest may not be
payable. In those circumstances an amount equal to the deemed accrued
interest may be treated for capital gains purposes as consideration
given by the noteholder for the preference shares received on
conversion (and in turn the ordinary shares or ADSs received on
exchange). As the notes are arguably variable rate securities for the
purposes of the scheme, the amount of the accrued income deemed to
have accrued may be such amount as the Inland Revenue decides is just
and reasonable.
(ii) Capital gains tax
Conversion of the notes should not of itself give rise to a charge to
U.K. capital gains tax.
2.3.3. Exchange
The tax treatment will be the same as that described for noteholders
within the charge to U.K. corporation tax in paragraph 2.2.3 above.
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3. Dividends on Ordinary Shares or ADSs
Shire will not be required to withhold tax at source when paying a dividend
on the ordinary shares or ADSs.
An individual holder of ordinary shares or ADSs who is resident in the
United Kingdom (for tax purposes) and who receives a dividend from Shire
will be entitled to a tax credit which such shareholder or ADS holder may
set off against his total income tax liability on the dividend. The tax
credit will be equal to 10% of the aggregate of the dividend and the tax
credit (the "gross dividend"), which is also equal to one-ninth of the cash
dividend received. A U.K. resident individual shareholder or ADS holder who
is liable to income tax at the starting or basic rate will be subject to
tax on the dividend at the rate of 10% of the gross dividend, so that the
tax credit will satisfy in full such shareholder's or ADS holder's
liability to income tax on the dividend. A U.K. resident individual
shareholder or ADS holder who is not liable to income tax in respect of the
gross dividend will not be entitled to repayment of the tax credit. In the
case of a U.K. resident individual shareholder or ADS holder who is liable
to income tax at the higher rate, the tax credit will be set against but
not fully match his tax liability on the gross dividend and he will have to
account for additional tax equal to 22.5% of the gross dividend (which is
also equal to 25% of the cash dividend received) to the extent that the
gross dividend when treated as the top slice of his income falls above the
threshold for higher rate income tax.
U.K. resident taxpayers who are not liable to U.K. tax on dividends,
including pension funds and charities, will not be entitled to claim
repayment of the tax credit attaching to dividends paid by Shire, although
charities will be entitled to limited compensation in lieu of repayable tax
credits until April 5, 2004.
Tax credits on dividends paid by Shire in respect of the ordinary shares
held in personal equity plans ("PEPs") or individual savings accounts
("ISAs") will be repayable on dividends paid on or before April 5, 2004.
U.K. resident corporate shareholders or ADS holders will generally not be
subject to corporation tax on dividends paid by Shire. Such shareholders or
ADS holders will not be able to claim repayment of tax credits attaching to
dividends.
Non-U.K. resident shareholders or ADS holders will not generally be able to
claim repayment from the Inland Revenue of any material part of the tax
credit attaching to dividends paid by Shire. A shareholder or ADS holder
resident outside the United Kingdom may also be subject to foreign taxation
on dividend income under local law. A shareholder or ADS holder who is not
resident in the United Kingdom (for tax purposes) should consult his own
tax adviser concerning his tax liabilities on dividends received from
Shire.
4. Disposal of the Ordinary Shares or ADSs
U.K. resident holders of the ordinary shares or ADSs may, depending on
their circumstances, be liable to U.K. taxation on chargeable gains in
respect of gains arising from a sale or other disposal of the ordinary
shares or ADSs.
5. Stamp Duty and Stamp Duty Reserve Tax
No U.K. stamp duty reserve tax ("SDRT") will be payable on the issue,
transfer or conversion of a note. No U.K. stamp duty will be payable on the
issue or conversion of the notes, or on the transfer of the notes, provided
that any transfer documents are executed and retained outside the United
Kingdom.
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No U.K. stamp duty or SDRT is payable on the issue of the preference
shares.
No U.K. stamp duty or SDRT is payable on the transfer of the preference
shares in exchange for ordinary shares or ADSs, or the issue of ordinary
shares save where the ordinary shares are issued to issuers of depositary
receipts or providers of clearance services (or their nominees or agents)
in which event SDRT at 1.5% of the issue price of the relevant shares will
arise unless (in the case of an issue to a clearance service) the clearance
service has made an election under Section 97A of the Finance Act 1986
which applies to the relevant shares. Under Section 97A of the Finance Act
1986, clearance services may, provided they meet certain conditions, elect
for the 0.5% rate of stamp duty or SDRT to apply to transfers of securities
within such services instead of the 1.5% rate applying to an issue or
transfer of such securities into the clearance service.
The transfer on sale of an ordinary share will be liable to ad valorem
stamp duty generally at the rate of 0.5% of the amount or value of the
consideration for the transfer rounded up to the nearest (pound)5. The
purchaser normally pays the stamp duty.
An unconditional agreement to sell an ordinary share will generally give
rise to a liability on the purchaser to SDRT, at the rate of 0.5% of the
amount or value of the consideration for the sale. If a duly stamped
transfer in respect of the agreement is produced within six years of the
date that the agreement is entered into or (if later) the date that it
becomes unconditional, any SDRT paid is repayable generally with interest,
and any unpaid SDRT charge is canceled.
Transfers of ordinary shares: (1) to, or to a nominee or agent for, a
person whose business is or includes issuing depositary receipts within
Section 67 or Section 93 of the Finance Act 1986 or (2) to, or to a nominee
or agent for, a person providing a clearance service within Section 70 or
Section 96 of the Finance Act 1986, will generally be subject to stamp duty
or SDRT at 1.5% of the amount or value of the consideration or, in certain
circumstances, the value of the ordinary shares transferred (rounded up to
the nearest (pound)5 in the case of stamp duty) unless, in the case of a
transfer to a clearance service, the clearance service has made an election
under Section 97A of the Finance Act 1986 which applies to the ordinary
shares. Under Section 97A of the Finance Act 1986, clearance services may,
provided they meet certain conditions, elect for the 0.5% rate of stamp
duty or SDRT to apply to transfers of securities within such services
instead of the 1.5% rate applying to an issue or transfer of such
securities into the clearance service.
A transfer of depositary receipts will not be subject to U.K. stamp duty,
provided that the depositary receipts are not held on a register in the
United Kingdom and that any transfer documents are executed and retained
outside the United Kingdom.
Under the CREST system for paperless share transfers, no stamp duty or SDRT
will arise on a transfer of ordinary shares into the system unless such
transfer is made for a consideration in money or money's worth, in which
case a liability to SDRT (usually at a rate of 0.5%) will arise. Paperless
transfers of ordinary shares within CREST will be liable to SDRT rather
than stamp duty.
Material U.S. Federal Income Tax Considerations
The following summary describes the material U.S. federal income tax
consequences resulting from beneficial ownership of the notes. It deals only
with purchasers of the notes who hold the notes as capital assets. This summary
is based upon the provisions of the Internal Revenue Code of 1986, as amended
(the "Code"), administrative pronouncements, judicial decisions, and Treasury
regulations currently in effect, any of which may be changed, possibly on a
retroactive basis, so as to result in federal income tax consequences different
from those discussed below. This summary is also based in part on the provisions
of the current income tax convention between the United Kingdom and the United
States (the "U.S./U.K. Treaty"). On July 24, 2001, U.K. and U.S. tax authorities
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signed a new income tax convention. This convention has not been ratified by the
U.S. Congress, and there can be no assurance that it will be ratified; thus, the
new convention does not currently have the force and effect of law. This summary
has no binding effect or official status of any kind; we cannot assure holders
that the conclusions reached below would be sustained by a court if challenged
by the Internal Revenue Service. We have not obtained and do not intend to
obtain a ruling from the IRS regarding the classification of the notes for U.S.
federal income tax purposes or for any other aspect of the tax consequences
described herein. For purposes of the Code, U.S. holders of Shire's ADRs
evidencing its ADSs will be treated for U.S. federal income tax purposes as the
owner of Shire's ordinary shares represented by those ADSs.
This summary does not address all aspects of U.S. federal income taxation
that may be applicable to holders in light of their particular circumstances and
does not address special classes of holders subject to special treatment (such
as dealers in securities or currencies, partnerships or other pass-through
entities, financial institutions, life insurance companies, banks, tax-exempt
organizations, certain expatriates, persons holding the notes as part of a
straddle or hedging or conversion transaction, persons whose functional currency
is not the U.S. dollar, or persons holding notes that own, or are deemed for
U.S. tax purposes to own, ten percent or more of the total combined voting power
of all classes of the voting stock of Shire). This summary also does not address
the effect of any state, local, or foreign tax laws that may apply, or the
application of the federal estate or gift tax or the alternative minimum tax.
A "U.S. holder" is a beneficial owner of a note that is, for U.S. federal
income tax purposes,
o a citizen or resident of the U.S.;
o a corporation that is organized under the laws of the U.S. or any
political subdivision thereof;
o an estate, the income of which is subject to U.S. federal income tax
without regard to its source; or
o a trust if a court within the U.S. is able to exercise primary
supervision over the administration of the trust and one or more U.S.
persons have the authority to control all substantial decisions of the
trust or if the trust has made a valid election to be treated as a
U.S. person.
A "Non-U.S. holder" is any beneficial owner that, for U.S. federal income
tax purposes, is a nonresident alien, or a corporation, estate or trust that is
not a U.S. holder.
If a partnership holds notes, the tax treatment of a partner will generally
depend on the status of the partner and on the activities of the partnership.
Partners of partnerships holding notes should consult their tax advisors.
Prospective purchasers of the notes should consult their own tax advisors
concerning the federal income tax consequences applicable to their particular
situations as well as any consequences to them arising under the tax laws of any
foreign, state or local taxing jurisdiction.
U.S. Holders
Payment of Interest
Payments of stated interest on a note will generally be taxable to a U.S.
holder as ordinary income at the time it is received or accrued, in accordance
with such holder's method of accounting for federal income tax purposes. The
interest will be treated as foreign source interest income for foreign tax
credit limitation and other purposes. The limitation on foreign taxes eligible
for credit is calculated separately with respect to specific classes of income;
for this purpose, interest on the notes should generally constitute "passive
income" or, in the case of certain U.S. holders, "financial services income."
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Market Discount
If a U.S. holder purchases a note for an amount that is less than its
principal amount by more than a de minimis amount, the excess of the principal
amount over the U.S. holder's purchase price will be treated as "market
discount". Under the market discount rules, a U.S. holder will be required to
treat any gain realized on the sale, exchange, retirement or other disposition
of a note as ordinary income to the extent of the lesser of (i) the amount of
such realized gain, or (ii) the market discount which has not previously been
included in income and is treated as having accrued on such note at the time of
such disposition. Market discount will be considered to accrue on a
straight-line basis during the period from the date of acquisition to the
maturity date of the note unless the U.S. holder elects to accrue market
discount on the basis of semiannual compounding.
A U.S. holder may be required to defer the deduction of all or a portion of
the interest paid or accrued on any indebtedness incurred or maintained to
purchase or carry a note with market discount until the maturity of the note or
certain earlier dispositions.
A U.S. holder may elect to include market discount in income currently as
it accrues, in which case the rules described above regarding the treatment as
ordinary income of gain upon the disposition of the note and regarding the
deferral of interest deductions will not apply. Persons considering making this
election should consult their tax advisors.
If a note with accrued market discount is exchanged for ordinary shares or
ADSs (by means of the initial conversion of notes into preference shares and the
exchange of the preference shares), the amount of such accrued market discount
at the time of conversion generally will be taxable to the U.S. holder as
ordinary income upon disposition of the ordinary shares or ADSs to the extent
there is gain on the disposition.
Amortizable Bond Premium
A U.S. holder that purchases a note at a premium over its stated principal
amount generally may elect to amortize such premium ("amortizable bond premium")
from the purchase date to the note's maturity date under a constant-yield
method. Amortizable bond premium, however, will not included any premium
attributable to a note's conversion feature. The premium attributable to the
conversion feature is the excess, if any, of the note's purchase price over what
the note's fair market value would be if there were no conversion feature.
Amortized bond premium is treated as an offset to interest income on a note and
not as a separate deduction. In general, a U.S. holder's tax basis in the notes
will be reduced by the amount of any bond premium as it is amortized or used to
offset interest income. Such amortization will cease upon exchange of the notes
for ordinary shares or ADSs (by means of the initial conversion of notes into
preference shares and the exchange of the preference shares).
Any election to amortize bond premium applies to all taxable debt
instruments acquired by the U.S. holder on or after the first day of the first
taxable year to which such election applies and may be revoked only with the
consent of the IRS.
Sale, Exchange or Redemption of Notes
Except as set forth below under "--Exercise of Conversion and Exchange
Rights," upon a sale, exchange or redemption of a note, a U.S. holder generally
will recognize gain or loss equal to the difference between the amount realized
upon the sale, exchange or redemption (less any accrued interest that has not
previously been included in income, which will be taxable as ordinary income)
and the holder's adjusted tax basis in the note at that time. A U.S. holder's
adjusted tax basis in a note will generally equal the purchase price of the note
increased by any accrued market discount that the U.S. holder has included in
income and decreased by the amount of any amortizable bond premium taken with
respect to such note. Except as set forth above under "--Market Discount," such
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gain or loss will be capital gain or loss and will be long-term capital gain or
loss if at the time of sale, exchange or redemption, the note has been held by
the U.S. holder for more than one year. Under current law, long-term capital
gains of certain non-corporate holders are generally taxed at lower rates than
items of ordinary income. The use of capital losses is subject to limitations.
Exercise of Conversion and Exchange Rights
The treatment of the exchange of notes for ordinary shares or ADSs (by
means of the initial conversion of notes into preference shares and the exchange
of preference shares for ordinary shares or ADSs) is unclear. Shire will elect
to treat the issuer as a disregarded entity for U.S. federal income tax
purposes. Therefore, the notes should be treated for U.S. federal income tax
purposes as indebtedness of Shire. Further, the issuance and exchange of the
preference shares should be disregarded. Accordingly, the exchange of notes for
ordinary shares or ADSs should not result in the recognition of gain or loss for
U.S. federal income tax purposes. The tax basis and holding period of the
ordinary shares or ADSs received upon the exchange should be the same as the
U.S. holder's adjusted tax basis and holding period for the notes. However, U.S.
holders who receive cash in lieu of a fractional share of Shire's ordinary
shares or ADSs upon the exchange of notes for Shire's ordinary shares or ADSs,
will be treated as if they received the fractional share and then had such
fractional share redeemed for the cash. Such U.S. holders would then recognize
gain or loss equal to the difference between the amount of cash received and
that portion of their basis in the stock attributable to the fractional share.
The aggregate basis in the remaining ordinary shares or ADSs will equal the
holder's adjusted basis in the ordinary shares or ADSs received, less any basis
allocable to the fractional share.
If the issuance and exchange of the preference shares are not disregarded
for U.S. federal income tax purposes, the exchange of notes for ordinary shares
or ADSs will give rise to gain or loss for U.S. federal income tax purposes. In
such event, the amount of gain or loss will be equal to the difference between
the value of the ordinary shares or ADSs received in the exchange (which will
become the new tax basis of such ordinary shares or ADSs) and the U.S. holder's
adjusted tax basis in the notes.
If Shire exercises the cash-out option, holders should be treated as though
they exchanged their notes for cash and should be treated as described above
under "--Sale, Exchange or Redemption of Notes."
Prospective investors should consult their tax advisors regarding the
likelihood that the issuance and exchange of preference shares will be
disregarded.
Adjustment to the Conversion Rate
The terms of the notes allow for changes in the conversion rate of the
notes in certain circumstances. A change in conversion rate that allows
noteholders to receive more ordinary shares or ADSs of Shire on conversion may
be treated as increasing the noteholders' proportionate interests in Shire's
earnings and profits or assets. In that case, the noteholders would be treated
as if they received a dividend in the form of Shire's stock. Such a constructive
stock dividend could be taxable to the noteholders, even though such holders
would not actually receive any cash or other property. For example, an increase
in the conversion rate in the event of a distribution of cash or property to
Shire's stockholders will generally result in deemed dividend treatment to the
noteholders, but generally an increase in the conversion rate to prevent
dilution of the noteholders' interests upon a stock split or other change in
capital structure would not result in deemed dividend treatment. Similarly, a
failure to adjust the conversion rate to reflect a stock dividend or similar
event could in some circumstances give rise to a constructive dividend to the
U.S. holders of Shire's ordinary shares or ADSs. Any taxable constructive stock
dividends resulting from an adjustment to the conversion rate, or a failure to
adjust the conversion rate, would be treated like dividends paid in cash or
other property. They would result in ordinary income to the recipient to the
extent of Shire's current or accumulated earnings and profits, with any excess
treated as a tax-free return of capital up to the recipient's tax basis, and
then as capital gain. Shire does not intend to calculate its earnings or profits
for U.S. federal income tax purposes.
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Passive Foreign Investment Company Considerations
The notes may be treated as including an option to acquire stock of Shire.
A special and adverse set of U.S. tax rules applies to a U.S. holder that holds
stock or an option to acquire stock in a passive foreign investment company
("PFIC"). In general, a PFIC is any non-U.S. corporation, if (1) 75% or more of
the gross income of the corporation for the taxable year is passive income (the
PFIC income test) or (2) the average percentage of assets held by the
corporation during the taxable year that produce passive income or that are held
for the production of passive income is at least 50% (the PFIC asset test). In
applying the PFIC income test and the PFIC asset test, a corporation that owns,
directly or indirectly, at least 25% by value of the stock of a second
corporation must take into account its proportionate share of the second
corporation's income and assets. If a corporation is classified as a PFIC for
any year during which a U.S. holder is a shareholder or has an option to become
a shareholder, then the corporation generally will continue to be treated as a
PFIC with respect to that shareholder in all succeeding years, regardless of
whether the corporation continues to meet the PFIC income test or the PFIC asset
test, subject to elections to recognize gain that may be available to the
shareholder.
Shire does not believe that it will be treated as a PFIC or has been
treated as a PFIC for any of its previous taxable years. However, Shire can
provide no assurance that it will not be treated as a PFIC in the current
taxable year, or in a future taxable year.
U.S. holders are advised to consult their own tax advisor as to the
application and effect of the PFIC provisions.
Registration Rights
The registration of the notes and the ordinary shares in the form of
ordinary shares and the ADSs issuable upon exchange of the preference shares
pursuant to the shelf registration statement of which this prospectus forms a
part will not be a taxable event for U.S. federal income tax purposes because
the registered securities will not be considered to differ materially in kind or
extent. In the unlikely event of an increase in the interest payable on the
notes as a result of the shelf registration statement ceasing to be effective,
such increase will not constitute a realization event for U.S. federal income
tax purposes. Any additional amounts paid due to the occurrence of the shelf
registration statement ceasing to be effective will be taxable to a U.S. holder
as ordinary interest at the time it accrues or is received in accordance with
such U.S. holder's regular method of tax accounting.
Ownership and Disposition of Ordinary Shares and ADSs
Distributions
Under the U.S./U.K. Treaty, subject to certain exceptions, a U.S. holder
that is a resident of the United States (and is not a resident of the United
Kingdom) for purposes of the U.S./U.K. Treaty is entitled to receive, in
addition to any dividend paid on the ordinary shares or ADSs, a payment from the
U.K. Inland Revenue in respect of such dividend equal to the tax credit to which
an individual resident in the United Kingdom for tax purposes would have been
entitled had he received the dividend (which is currently equal to one-ninth of
the dividend received), reduced by a U.K. withholding tax equal to an amount not
exceeding 15% of the sum of the dividend paid and the U.K. tax credit payment.
At current rates, the withholding tax entirely eliminates the tax credit
payment, but no U.K. withholding tax in excess of the tax credit payment is
imposed upon the U.S. holder. Accordingly, for example, a U.S. holder that is
entitled to receive a $100 dividend on the ordinary shares or ADSs also will be
treated as receiving from the Inland Revenue a tax credit payment of $11.11
(one-ninth of the dividend received), but the entire $11.11 payment will be
eliminated by U.K. withholding tax, resulting in a net $100 distribution to the
U.S. holder.
-68-
For U.S. federal income tax purposes, distributions with respect to the
ordinary shares or ADSs, other than distributions in liquidation and
distributions in redemption of stock that are treated as exchanges, will be
taxed to U.S. holders as ordinary dividend income to the extent that the
distributions do not exceed Shire's current and accumulated earnings and
profits. The amount of any distribution will equal the sum of the cash
distribution and the associated U.K. tax credit payment; thus, as described
above, if a U.S. holder is entitled to receive a $100 cash distribution, then he
will be deemed to have received a total distribution of $111.11. Distributions,
if any, in excess of Shire's current and accumulated earnings and profits will
constitute a non-taxable return of capital and will be applied against and
reduce the holder's tax basis in the ordinary shares or ADSs. To the extent that
these distributions exceed the U.S. holder's tax basis in the ordinary shares or
ADSs, the excess generally will be treated as capital gain. Shire does not
intend to calculate its earnings or profits for U.S. federal income tax
purposes.
Dividend income derived with respect to the ordinary shares and ADSs will
constitute "portfolio income" for purposes of the limitation on the use of
passive activity losses, and, therefore, generally may not be offset by passive
activity losses, and as "investment income" for purposes of the limitation on
the deduction of investment interest expense. Such dividends will not be
eligible for the dividends received deduction generally allowed to a U.S.
corporation under Section 243 of the Code.
In computing his U.S. federal income tax liability, a U.S. holder may elect
for each taxable year to claim a deduction or, subject to the limitations on
foreign tax credits generally, a U.S. foreign tax credit for foreign income
taxes withheld from any distributions paid on the ordinary shares or ADSs. The
IRS has confirmed in a recent revenue procedure that, in the case of U.S.
holders and subject to certain limitations, a foreign tax credit may be claimed
for the amount of U.K. withholding tax deemed to be imposed under the U.S./U.K.
Treaty. As discussed above, the amount of U.K. withholding tax deemed to be
imposed is equal to one-ninth of the associated cash distribution. To qualify
for this credit, a U.S. holder must make an election on Form 8833 (Treaty-Based
Return Position Disclosure), which must be filed with its tax return for the
relevant taxable year, in addition to any other filings that may be required.
For U.S. foreign tax credit purposes, dividends paid on the ordinary shares and
ADSs generally will be treated as foreign-source income and as passive income,
subject to the separate foreign tax credit limitation for passive income. The
availability of foreign tax credits depends on a U.S. holder's particular
circumstances. U.S. holders are advised to consult their own tax advisors. If
the income tax convention signed July 24, 2001, which does not currently have
the force and effect of law, is ratified by the U.S. Congress and is entered
into force, U.S. holders would no longer be entitled to receive a tax credit
payment from the U.K. Inland Revenue in respect of dividends on the ordinary
shares or ADSs. Accordingly, the amount of any distributions on the ordinary
shares or ADSs would be limited to the value of the cash or other property
distributed. Further, as described above under "U.K. Tax Considerations--3.
Dividends on Ordinary Shares or ADSs," U.S. holders would not be subject to U.K.
withholding tax on the amount of any distributions in respect of the ordinary
shares or ADSs and therefore would not be entitled to claim a deduction or
credit for foreign withholding taxes relating thereto. U.S. holders should
consult their tax advisors regarding the effect of the new convention if it is
entered into force, including the availability of an election to continue to
receive the foreign tax credits described above for a 12-month period from the
effective date of the convention if the holder elects to apply the U.S./U.K.
Treaty in its entirety for such period.
In the case of distribution in sterling, the amount of the distributions
generally will equal the U.S. dollar value of the sterling distributed,
determined by reference to the spot currency exchange rate on the date of
receipt, regardless of whether a U.S. holder reports income on a cash basis or
on an accrual basis. A U.S. holder will realize separate foreign currency gain
or loss only to the extent that this gain or loss arises on the actual
disposition of sterling received. For U.S. holders claiming foreign tax credits
on a cash basis, taxes withheld from the distribution are translated into U.S.
dollars at the spot rate on the date of the distribution; for U.S. holders
claiming foreign tax credits on an accrual basis, taxes withheld from the
distribution are translated into U.S. dollars at the average rate for the
taxable year.
-69-
Sale or Exchange
Upon a sale or exchange of ordinary shares or ADSs to a person other than
Shire, a U.S. holder will recognize gain or loss in an amount equal to the
difference between the amount realized on the sale or exchange and such holder's
adjusted tax basis in the ordinary shares or ADSs. Except as set forth above
under "--Market Discount," such gain or loss will be capital gain or loss and
will be long-term capital gain or loss if the U.S. holder has held the ordinary
shares or ADSs for more than one year.
Gain or loss recognized by a U.S. holder on the sale or exchange of
ordinary shares or ADSs generally will be treated as U.S.-source gain or loss
for U.S. foreign tax credit purposes.
Non-U.S. Holders
Payments to a Non-U.S. holder on the notes or on Shire's ordinary shares or
ADSs, or gain realized by a Non-U.S. holder on the sale, exchange or redemption
of the notes or Shire's ordinary shares or ADSs, will not be subject to U.S.
federal income or withholding tax, as the case may be, unless such income is
effectively connected with a trade or business conducted by such Non-U.S. holder
in the United States.
Income that is effectively connected to the conduct of a U.S. trade or
business by a Non-U.S. holder will generally be subject to regular U.S. federal
income tax in the same manner as if it were realized by a U.S. holder. Non-U.S.
holders that realize such income with respect to the notes or our ordinary
shares or ADSs should consult their tax advisors as to the treatment of such
income or gain.
Information Reporting and Backup Withholding
U.S. Holders
Payments made in the United States or through certain U.S.-related
financial intermediaries of interest or dividends, or the proceeds of the sale
or other disposition of, the notes or Shire's ordinary shares or ADSs may be
subject to information reporting and U.S. federal backup withholding if the
recipient of such payment fails to supply an accurate taxpayer identification
number or otherwise fails to comply with applicable U.S. information reporting
or certification requirements. Any amount withheld from a payment to a U.S.
holder under the backup withholding rules is refundable or allowable as a credit
against the holder's U.S. federal income tax, provided that the required
information is furnished to the IRS.
Non-U.S. Holders
A Non-U.S. holder may be required to comply with certification procedures
to establish that the holder is not a U.S. person in order to avoid backup
withholding tax and information reporting requirements discussed above.
-70-
SELLING SECURITYHOLDERS
The notes were originally issued by the issuer and sold by Bear, Stearns
International Limited, Goldman Sachs International, Merrill Lynch International
Limited and WestLB Panmure Limited (the "Initial Purchasers") in a transaction
exempt from the registration requirements of the Securities Act to persons
reasonably believed by the Initial Purchasers to be "qualified institutional
buyers" as defined by Rule 144A under the Securities Act or pursuant to
Regulation S under the Securities Act. The selling securityholders may from time
to time offer and sell pursuant to this prospectus any or all of the notes
listed below and our ordinary shares or ADSs which may be issued upon exchange
of the preference shares issued upon conversion of such notes. When we refer to
the "selling securityholders" in this prospectus, we mean those persons listed
in the table below, as well as the permitted pledgees, donees, assignees,
transferees, successors and others who later hold any of the selling
securityholders' interests.
The table below sets forth the name of each selling securityholder, the
principal amount of notes that each selling securityholder may offer pursuant to
this prospectus and the number of our ordinary shares or ADSs which will be
issued upon exchange, subject to the option of the issuer to have Shire pay cash
upon exchange, of the preference shares into which such notes are convertible.
Unless set forth below, none of the selling securityholders has, or within the
past three years has had, any material relationship with us or any of our
predecessors or affiliates.
We have prepared the table below based on information given to us by the
selling securityholders on or prior to November 5, 2001. However, any or all of
the notes or our ordinary shares or ADSs listed below may be offered for sale
pursuant to this prospectus by the selling securityholders from time to time.
Accordingly, no estimate can be given as to the amounts of notes or number of
our ordinary shares or ADSs that will be held by the selling shareholders are being registeredsecurityholders
upon consummation of any such sales. In addition, the selling securityholders
listed in the table below may have acquired, sold or transferred, in
transactions exempt from the registration requirements of the Securities Act,
some or all of their notes since the date as of which the information in the
table is presented.
Information about the selling securityholders may change over time. Any
changed information will be set forth in prospectus supplements. From time to
permit public resaletime, additional information concerning ownership of these ordinary shares. See "Plan of Distribution."
The following table includes (i) the identity of each selling
shareholder; (ii) the amount ofnotes and our ordinary
shares owned byor ADSs may rest with certain holders thereof not named in the selling shareholder
before the offering, (iii) the amounttable
below and of ordinary shares each selling
shareholder is offering for its account and (iv) the amount and, if one percent
or more, the percentage of each selling shareholder will own after completion of
the offering, assuming all ordinary shares covered by this prospectuswhom we are sold.
Beneficial ownership is determined in accordance with the rules of the
SEC, and includes voting or investment power with respect to ordinary shares.
Unless otherwise indicated below, to our knowledge, the selling shareholders
have sole voting and investment power with respect to their respective ordinary
shares, except to the extent authority is shared by spouses under applicable
law. The inclusion of any ordinary shares in this table does not constitute an
admission of beneficial ownership for the person named below.unaware.
Number of PercentOur
Ordinary Percentage of
Aggregate Principal Percentage Shares/ADSs That Our Ordinary
Ordinary
NumberAmount of Ordinary Shares Shares
Shares Beneficially NumberNotes That of Ordinary Beneficially BeneficiallyNotes May Be Sold (1) Shares/ADSs
Name of Selling Owned Prior to Shares Offered Owned After Owned After
Shareholder Offering Hereby Offering (1) Offering (1)
- ----------- -------- ------ ------------ ------------May Be Sold Outstanding Outstanding (2)
Robert A. Vukovich
Triborough Partners QP, LLC $1,250,000 * 62,022/ */*
20,674
Triborough Partners International, 500,000 * 24,809/ */*
Ltd. 8,270
Tribeca Investments LLC 6,000,000 1.5 297,705/ */*
99,235
AIG SoundShore Overseas Holding 4,500,000 1.1 223,279/ */*
Fund Ltd. 74,426
-71-
Number of Our
Ordinary Percentage of
Aggregate Principal Percentage Shares/ADSs That Our Ordinary
Amount of Notes That of Notes May Be Sold (1) Shares/ADSs
Name May Be Sold Outstanding Outstanding (2)
7,385,742 5,422,922 1,962,820AIG SoundShore Strategic Holding 1,500,000 * Yamanouchi74,426/ */*
Fund Ltd. 24,809
First Union Securities Inc. 2,100,000 * 104,197/ */*
34,732
UBS Warburg LLC 1,000,000 * 49,617/ */*
16,539
Highbridge International LLC 12,000,000 3.0 595,409/ */*
198,470
TD Securities (USA) Inc. 7,500,000 1.9 372,131/ */*
124,044
Deutsche Banc Alex Brown Inc. 42,700,000 10.7 2,118,665/ */1.7
706,223
National Fuel & Gas Company 150,000 * 7,443/ */*
Retirement Plan 2,481
Radian Guaranty, Inc. 2,000,000 * 99,235/ */*
33,078
Radian Asset Guaranty 1,250,000 * 62,022/ */*
20,674
Total Fina E/F Finance U.S.A., Inc. 200,000 * 9,923/ */*
3,308
Oxford, Lord Abbett & Co. 1,500,000 * 74,426/ */*
24,809
Sagamore Hill Hub Fund Ltd. 4,000,000 1.0 198,469/ */*
66,157
B.C. McCabe Foundation 300,000 * 14,885/ */*
4,961
Clinton Riverside Convertible 3,350,000 * 166,218/ */*
Portfolio Limited 55,406
-72-
Number of Our
Ordinary Percentage of
Aggregate Principal Percentage Shares/ADSs That Our Ordinary
Amount of Notes That of Notes May Be Sold (1) Shares/ADSs
Name May Be Sold Outstanding Outstanding (2)
Clinton Multistrategy Master Fund, 2,150,000 * 106,678/ */*
Ltd. 35,559
Bank Austria Cayman Islands Ltd. 10,875,000 2.7 539,590/ */*
179,863
RCG Latitude Master Fund Ltd. 2,610,000 * 129,502/ */*
43,167
Ramius Capital Group Holdings, Inc.725,000 * 35,973/ */*
11,991
RCG Multistrategy LP 290,000 * 14,389/ */*
4,796
Forest Fulcrum Fund LP 2,500,000 * 124,044/ */*
41,348
Susquehanna Capital Group 10,500,000 2.6 520,983/ */*
173,662
Goldman Sachs International 81,500,000 20.4 4,043,822/ */3.2
1,347,944
Goldman Sachs and Company 2,750,000 * 136,448/ */*
45,483
All other holders of notes or 194,300,000 48.6 9,640,671/ 2.0/
future transferees, pledgees, 3,213,567 7.7
donees, assignees or successors
of any such holders (3) 15,791,706 15,791,706 0 0(4)
Total.............................. $400,000,000 100% 19,640,671/ 4.1/
6,615,680 15.9
o Less than one percent (1%).
---------------
(footnotes appear on following page)
-73-
(1) Assumes the saleconversion of all of the holder's notes into preference shares and
exchange of the preference shares at an exchange ratio of 49.6175 ordinary
shares offered by this prospectus.
(2) Includesper preference share or 16.5392 ADSs per preference share. This
exchange ratio is subject to adjustment, however, as described under
"Description of the Notes -- Adjustments to the Exchange Ratio." As a
result, the number of our ordinary shares heldor ADSs which may be issued upon
exchange of the preference shares issued upon conversion of the notes may
increase or decrease in the form of ADS andfuture. Does not include our ordinary shares issuableor
ADSs that may be issued by us upon election by the exerciseissuer to convert notes
into preference shares instead of options.
(3) Allredeeming notes at the holder's option,
as described under "Description of the Notes -- Redemption at Option of
Holders."
(2) Calculated based on Rule 13d-3(d)(i) of the Exchange Act, using 479,367,095
ordinary shares are(including ordinary shares underlying ADSs) or 41,581,867
ADSs outstanding as of November 5, 2001. In calculating this amount for
each holder, we treated as outstanding the number of our ordinary shares or
ADSs which may be issued upon exchange of the preference shares issued upon
conversion of all notes held by that holder, but we did not assume
conversion of any other holder's notes. Does not include our ordinary
shares or ADSs that may be issued by us upon election by the issuer to
convert notes into preference shares instead of redeeming notes at the
holder's option, as described under "Description of the Notes -- Redemption
at Option of Holders."
(3) Information about other selling securityholders will be set forth in
prospectus supplements, if required.
(4) Assumes that any other holders of notes, or any future pledgees, donees,
assignees, transferees or successors of or from any such other holders of
notes, do not beneficially own any of our ordinary shares or ADSs other
than the formordinary shares or ADSs which may be issued upon exchange of ADSs.
* Less than 1%.
-4-the
preference shares issued upon conversion of the notes.
-74-
PLAN OF DISTRIBUTION
We are registering the notes and our ordinary shares, on behalfincluding ordinary
shares underlying the ADSs, which may be issued upon exchange of the selling
shareholders. As used inpreference
shares issued upon conversion of the notes covered by this prospectus the term "selling shareholders"
includes donees, pledgees, transfers or other successors-in-interest selling
shares receivedto permit
securityholders to conduct public secondary trading of these securities from
a selling shareholder as a gift, pledge, partnership
distribution or other non-sale related transfertime to time after the date of this prospectus. All costs,We have agreed, among other
things, to bear all expenses, other than underwriting discounts and feesselling
commissions, in connection with the registration and sale of the notes and our
ordinary shares offered undercovered by this prospectusprospectus.
We will be borne by us. Brokerage
commissions and similar selling expenses, ifnot receive any attributable toof the saleproceeds from the offering of the notes, our
ordinary shares will be borne by selling shareholders. Sales of ordinary shares
may be effectedor our ADSs by the selling shareholderssecurityholders. We have been advised
by the selling securityholders that the selling securityholders may sell all or
a portion of the notes and our ordinary shares or ADSs beneficially owned by
them and offered hereby from time to time:
o directly; or
o through underwriters, broker-dealers or agents, who may receive
compensation in the form of discounts, commissions or concessions from
the selling securityholders or from the purchasers of the notes and
our ordinary shares or ADSs for whom they may act as agent; provided
that a sale will take the form of an underwritten offering only with
the prior consent of Shire in its sole discretion.
The notes, our ordinary shares and our ADSs may be sold from time to time
in one or more typestransactions at:
o fixed prices, which may be changed;
o prevailing market prices at the time of transactions (whichsale;
o varying prices determined at the time of sale; or
o negotiated prices.
These prices will be determined by the holders of the securities or by agreement
between these holders and underwriters or dealers who may include block transactions)receive fees or
commissions in connection with the sale. The aggregate proceeds to the selling
securityholders from the sale of the notes, our ordinary shares or our ADSs
offered by them hereby will be the purchase price of the notes, our ordinary
shares or our ADSs less discounts and commissions, if any.
The sales described in the preceding paragraph may be effected in
transactions:
o on any national securities exchange or quotation service on which the
notes and our ordinary shares and ADSs may be listed or quoted at the
time of sale, including the London Stock Exchange in the over-the-counter market, in negotiated transactions, through
put or call options transactions relating tocase of the
ordinary shares and the notes and the Nasdaq National Market in the
case of the ADSs;
o in the over-the-counter market;
o in transactions otherwise than on such exchanges or services or in the
over-the-counter market; or
o through the writing of options.
These transactions may include block transactions or crosses. Crosses are
transactions in which the same broker acts as an agent on both sides of the
trade.
-75-
In connection with sales of the notes, our ordinary shares and our ADSs or
otherwise, the selling securityholders may enter into hedging transactions with
broker-dealers. These broker-dealers may in turn engage in short sales of the
notes, our ordinary shares and our ADSs in the course of hedging their
positions. The selling securityholders may also sell the notes, our ordinary
shares and our ADSs short and deliver notes, our ordinary shares and our ADSs to
close out short positions, or loan or pledge notes, our ordinary shares and our
ADSs to broker-dealers that in turn may sell the notes, our ordinary shares and
our ADSs.
To our knowledge, there are currently no plans, arrangements or
understandings between any selling securityholders and any underwriters,
broker-dealer or agent regarding the sale of the notes, our ordinary shares and
our ADSs by the selling securityholders. Selling securityholders may not sell
any, or may not sell all, of the notes, our ordinary shares and our ADSs offered
by them pursuant to this prospectus. In addition, we cannot assure you that a
selling securityholder will not transfer, devise or gift the notes, our ordinary
shares or a combination of such methods of sale, at market
prices prevailing at the time of sale, or at negotiated prices. Such
transactions may or mayour ADSs by other means not involve brokers or dealers.described in this prospectus. In addition,
any securities covered by this prospectus which qualify for sale pursuant to
Rule 144 or Rule 144A of the foregoing types of transactions,Securities Act may be sold under Rule 144 or Rule
144A rather than pursuant to this prospectus.
Our outstanding ordinary shares and notes are listed for trading on the
selling shareholders may effect sales ofLondon Stock Exchange. Our ADSs inare listed for trading on the Nasdaq National
Market. Each ADS represents three ordinary shares.
The selling shareholders have advised us
that they have not entered intosecurityholders and any agreements, understandings or arrangements
with any underwriters or broker-dealers regarding the sale of their securities,
nor is there an underwriter or coordinating broker acting in connection with the
proposed sale of ordinary shares by the selling shareholders.
The selling shareholders may effect such transactions by selling
ordinary shares directly to purchasers or to or through broker-dealers, which
may act as agents or principals. Such broker-dealers may receive compensation in
the form of discounts, concessions, or commissions from the selling shareholder
and/or the purchasers of ordinary shares for whom such broker-dealers may act as
agents or to whom they sell as principal, or both (which compensation as to a
particular broker-dealer might be in excess of customary commissions).
The selling shareholders and any broker-dealers, agents
or underwriters that act in connectionparticipate with the saleselling securityholders in the
distribution of the notes, our ordinary shares might be deemed to be "underwriters" within the
meaning of Section 2(11) of the Securities Act, and any commissions received by
such broker-dealers and any profit on the resale of the ordinary shares sold by
them while acting as principals might be deemed to be underwriting discounts or commissions under the Securities Act. The selling shareholders may agree to
indemnify any agent, dealer or broker-dealer that participates in transactions
involving sales of the ordinary shares against certain liabilities, including
liabilities arising under the Securities Act.
Because selling shareholdersour ADSs may be deemed to be
"underwriters" within the meaning of Section 2(11)the Securities Act. In this case, any
commissions received by these broker-dealers, agents or underwriters and any
profit on the resale of the notes, our ordinary shares or our ADSs purchased by
them may be deemed to be underwriting commissions or discounts under the
Securities Act. In addition, any profits realized by the selling securityholders
may be deemed to be underwriting commissions.
The notes were issued and sold in August 2001 in transactions exempt from
the registration requirements of the Securities Act to persons reasonably
believed by the Initial Purchasers to be "qualified institutional buyers," as
defined in Rule 144A under the Securities Act, or pursuant to Regulation S under
the Securities Act. We have agreed to indemnify the Initial Purchasers and each
selling shareholders may
be subjectsecurityholder, and each selling securityholder has agreed to indemnify
us, the prospectus delivery requirements ofInitial Purchasers and each other selling securityholder, against
specified liabilities arising under the Securities Act.
The selling shareholders alsosecurityholders and any other person participating in such
distribution will be subject to the Exchange Act. The Exchange Act rules
include, without limitation, Regulation M, which may resell all or a portionlimit the timing of
purchases and sales of any of the notes and the ordinary shares or ADSs by the
selling securityholders and any such other person. In addition, Regulation M of
the Exchange Act may restrict the ability of any person engaged in open market transactionsthe
distribution of the notes and the ordinary shares or ADSs to engage in
reliance upon Rule 144market-making activities with respect to the particular notes and the ordinary
shares or ADSs being distributed for a period of up to five business days prior
to the commencement of the distribution. This may affect the marketability of
the notes and the ordinary shares or ADSs and the ability of any person or
entity to engage in market-making activities with respect to the notes and the
ordinary shares or ADSs.
All expenses of the registration of the securities, including, without
limitation, SEC filing fees and expenses of compliance with state securities or
"blue sky" laws will be paid by Shire and the issuer; provided, however, that
the selling holders will pay all underwriting discounts and selling commissions,
if any. Subject to some limitations, the selling holders will be indemnified by
Shire and the issuer against civil liabilities, including liabilities under the
Securities Act, provided they meet the criteria and conform to the requirements
of such Rule.
Upon our being notified by a selling shareholder that any material
arrangement has been entered into with a broker-dealer for the sale of ordinary
shares through a block trade, special offering, exchange distribution or
secondary distribution or a purchase by a broker or dealer, a supplement to this
prospectus will be filed, if required, pursuantentitled to Rule 424(b)contribution in connection therewith.
Subject to some limitations, Shire and the issuer will be indemnified by the
selling holders against civil liabilities, including liabilities under the
Securities Act, disclosing (i)or will be entitled to contribution in connection therewith.
-76-
ENFORCEMENT OF CIVIL LIABILITIES
We are a public limited company incorporated under the namelaws of each such selling shareholderEngland and
Wales and the issuer is an exempted limited company organized under the laws of
the participating broker-dealer(s), (ii)Cayman Islands. We and the numberissuer have consented in the indenture to
jurisdiction in the U.S. federal and state courts in The City of shares involved, (iii)New York and to
service of process in The City of New York in any legal suit, action or
proceeding brought to enforce any rights under or with respect to the price at which such shares were sold, (iv)indenture
and the commissions paidnotes. Accordingly, any judgment against us or discountsthe issuer in respect of
the indenture or concessions allowedthe notes, including for civil liabilities under the U.S.
federal securities laws, obtained in any U.S. federal or state court may have to
such broker-dealer(s), where applicable, (v)be enforced in the courts of England and Wales or the Cayman Islands. Investors
should not assume that the courts of England and Wales or the Cayman Islands
would enforce judgments of U.S. courts obtained against us predicated upon the
civil liability provisions of the U.S. federal securities laws or that such
broker-dealer(s) did not conduct any investigationcourts would enforce, in original actions, liabilities against us predicated
solely upon such laws.
LEGAL MATTERS
Certain matters of English law will be passed upon for us by our counsel,
Slaughter and May, London, England, U.K. Certain U.S. legal matters with respect
to verify the information set
out ornotes will be passed upon for us and the issuer by Cahill Gordon &
Reindel, New York, New York. Certain Cayman Islands legal matters will be passed
upon for us and the issuer by Maples and Calder Europe, London, England, U.K.
INDEPENDENT AUDITORS
The restated financial statements as of December 31, 2000 and 1999 and for
each of the years in the three-year period ended December 31, 2000 included in
the Form 8-K filed on August 15, 2001 and incorporated by reference in this
prospectusregistration statement have been audited by Arthur Andersen, independent public
accountants, as set forth in their reports. In those reports, that firm states
that with respect to certain entities its opinion is based on the reports of
other independent public accountants, namely Ernst & Young LLP and (vi) other facts
materialRaymond
Chabot Grant Thornton. The financial statements referred to above have been
included herein in reliance upon the authority of those firms as experts in
giving said reports.
The financial statements of BioChem Pharma Inc. included in the Form 20-F
for the year ended December 31, 1999 and incorporated by reference in this
registration statement have been audited by Raymond Chabot Grant Thornton,
independent public accountants, as indicated in their report with respect
thereto, which is incorporated by reference in reliance upon the authority of
said firm as experts in giving said report.
The financial statements of Roberts Pharmaceutical Corporation included in
the Form 10-K for the year ended December 31, 1998 and incorporated by reference
in this registration statement have been audited by Ernst & Young LLP,
independent public accountants, as indicated in their report with respect
thereto, which is incorporated by reference in reliance upon the authority of
said firm as experts in giving said report.
AVAILABLE INFORMATION
We are subject to the transaction.
-5-informational requirements of the Exchange Act which
means that we file reports, proxy and information statements and other
information with the SEC. You can inspect and copy those reports, proxy and
information statements and other information at the SEC's public reference room
located at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington, D.C.
20549. You can obtain copies of this material at prescribed rates by writing to
the Securities and Exchange Commission, Public Reference Section, 450 Fifth
Street, N.W., Room 1024, Washington, D.C. 20549. Information on the operation of
the Public Reference Room may be obtained by calling the SEC toll-free at
1-800-SEC-0330. The SEC also maintains an Internet website that contains
reports, proxy and information statements and other information regarding
registrants such as us that file electronically with the SEC. The address of
this website is http://www.sec.gov.
-77-
INCORPORATION OF DOCUMENTS BY REFERENCE; ADDITIONAL INFORMATIONREFERENCE
We "incorporate by reference" into this prospectus certain information we
file with the Securities
and Exchange Commission (the "Commission"),SEC, which means that we can disclose important information to you
by referring you to those documents.another document filed separately with the SEC. The
information incorporated by reference is an important part of this prospectus
and information
that we file after the date of this prospectus with the Commission in the futureSEC will automatically
update and supersede this information. In addition, the information in this prospectus. Those future
filings include annual reports on Form 10-K, quarterly reports on Form 10-Q that are designated as beingwe file
after the date of the initial registration statement and prior to the
effectiveness of the registration statement shall be deemed to be incorporated
by reference into this prospectus and other
reports we file with the Commission.
This prospectus incorporatesprospectus. We incorporate by reference into this
prospectus the following documents that
we previously filed with the Commissionlisted below (File No. 0-29630) and any future filings
made with the CommissionSEC, including prior to the effectiveness of the registration
statement of which this prospectus is a part, under SectionsSection 13(a), 13(c), 14 or
15(d) of the Exchange Act, until
all the ordinary shares offered by this prospectus are sold. These documents
contain important information about us and our finances.
o Shire's Annual Reportany reports submitted on Form 10-K for the fiscal year ended December
31, 1999, as amended.
o Shire's Quarterly Report6-K by identifying
on Form 10-Q for the period ending March 31,
2000.
o Shire's Proxy Statement on Schedule 14A for the fiscal year ended
December 31, 1999.
o Shire's Current Report on Form 8-K as filed with the Commission on
February 29, 2000.
o the description of our ordinary shares contained in Shire's
Registration Statement on Form F-1 as filed with the Commission on
March 25, 1998
Shire files annual and special reports and other information with the
Commission. You may read and copy any of our reports, statements or other
information at the Commission's Public Reference Room at 450 Fifth Street, N.W.,
Washington, D.C. 20549. Please call the Commission at 1-800-SEC-0330 for further
information on the Public Reference Room. Our Commission filingssuch forms that they are also
available to the public from commercial document retrieval services. The website
maintained by the Commission is http://www.sec.gov.
You may also request a copy of these filings, at no cost, by writing or
telephoning us at our principal executive offices at this address: Shire
Pharmaceuticals Group plc, East Anton, Andover, Hampshire SP10 5RG, England,
Attention: Neil Harris, Esq.
LEGAL MATTERS
The validity of the ordinary shares offered under this prospectus will
be passed upon for Shire by Slaughter & May, U.K. Counsel to Shire.
EXPERTS
The consolidated financial statementsbeing incorporated by reference ininto this
prospectus, until all of the prospectus and elsewhere in the Registration Statement, have been audited and
reported by Arthur Andersen Chartered Accountants, Ernst & Young LLP and
PricewaterhouseCoopers LLP and upon the authority of such firms as experts in
auditing and accounting.
-6-
THE "SAFE HARBOR" STATEMENT UNDER
THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
Statements included herein whichnotes offered hereby are not historical facts are forward
looking statements. The forward looking statements involve a number of risks and
uncertainties and are subject to change at any time. In the event such riskssold or uncertainties materialize,until this
offering is otherwise terminated:
o our results could be materially affected. The risks
and uncertainties include, but are not limited to, risks associated with the
inherent uncertainty of pharmaceutical regulation and approval, product
liability litigation and other risks and uncertainties detailed from time to
time in our filing with the Commission including the annual report on Form 10-K for the year ended December 31, 1999.2000,
filed on February 27, 2001;
o our proxy statement for the extraordinary general meeting of
shareholders, filed on March 1, 2001;
o our quarterly reports on Form 10-Q for the periods ended March 31,
2001 and June 30, 2001, filed on May 14, 2001 and August 13, 2001,
respectively;
o our current reports on Form 8-K dated May 4, May 11, May 15, July 17,
July 23, as amended, July 25, August 15, and October 18 2001; and
o our proxy statement for the 2000 annual meeting of shareholders, filed
on April 30, 2001.
The following documents filed with the SEC by BioChem Pharma Inc. (File No.
0-19539) are incorporated in this document by reference:
o annual report on Form 20-F for the year ended December 31, 1999;
o current reports on Form 6-K submitted on January 10, January 26,
February 15, March 6, March 9, March 15, April 3, April 11, April 20,
April 27, April 28, May 1, May 24, June 19, June 27, July 11, July 18,
July 26, August 4, August 28, September 22, October 26, November 1,
November 15, November 20, December 1, December 11, December 13,
December 18, December 22 and December 31, 2000; and
o current reports on Form 6-K submitted on January 10, January 26,
February 1, February 6, March 1, March 28, March 30 and April 5, 2001.
Any statement contained in a document incorporated or considered to be
incorporated by reference in this prospectus shall be considered to be modified
or superseded for purposes of this prospectus to the extent that a statement
contained in this prospectus or in any subsequently filed document that is or is
considered to be incorporated by reference modifies or supersedes such
statement. Any statement that is modified or superseded shall not, except as so
modified or superseded, constitute a part of this prospectus.
You may request a copy of any of the documents which are incorporated by
reference in this prospectus, other than exhibits which are not specifically
incorporated by reference into such documents and our memorandum and articles of
association, at no cost, by writing or telephoning us at the following:
Shire Pharmaceuticals Group plc
Hampshire International Business Park
-78-
Chineham
Basingstoke
Hampshire, England RG24 8EP
Telephone: +44 (0) 1256 894 000
-79-
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Shire Pharmaceuticals Group plc ("Shire") and Shire Finance Limited ("Shire
Finance" and, together with Shire, the "Registrants") are paying all of the
selling securityholders' expenses related to this offering, except the selling
securityholders will pay any applicable broker's commissions and expenses. The
following table sets forth the approximate amount of fees and expenses payable
by the Registrants in connection with this registration statement and the
distribution of the Notes and Ordinary Shares of Shire being registered hereby.
All amounts shown are estimated, except the SEC registration fee and the London
Stock Exchange listing fee for the Notes and Ordinary Shares.
SEC registration fee............................................. $ 100,000
London Stock Exchange listing fee for Notes and Ordinary Shares.. 4,589
Printing and engraving expenses.................................. *
Legal fees and expenses.......................................... *
Accounting fees and expenses..................................... *
Trustee and transfer agent fees.................................. *
Miscellaneous.................................................... __________
Total................................................... $ *
----------
* To be provided by amendment.
Item 15. INDEMNIFICATION OF DIRECTORSOFFICERS AND OFFICERSDIRECTORS.
Except as hereinafter set forth, there is no charter provisions,provision, by-law,
contract, arrangement or statute under which any director or officer of Shirethe
Registrants is insured or indemnified in any manner against any liability which
he may incur in his capacity as such.
Pursuant to Paragraph 141142 of the Articles of Association of Shire and
subject to the Companies Act 1985, every person who was or is a director,
alternate director or secretary of Shire shall be indemnified out of the assets
of Shire for all costs, charges, losses and liabilities incurred by such person
in the proper execution of such person's duties or the proper exercise of such
person's powers, authorities and discretions.
Under Section 310 of the Companies Act 1985 of Great Britain, any provision
contained in Shire's articles or in any contract with Shire may not indemnifyor otherwise for
exempting any officer of Shire or any person (whether an officer or not)
employed by Shire as auditor from, or indemnifying such person against, any
liability that by virtue of any rule of law would otherwise attach to him in
respect of any negligence, default, breach of duty or breach of trust of which
he may be guilty in relation to Shire is void, except that under sectionSection 310(3)
of the Companies Act 1985, Shire is not prevented, inter alia, (a) from
purchasing and maintaining for any such officer such insurance against any such
liability, or (b) from indemnifying an officer against any liability incurred by
him in defending any proceedings (whether civil or criminal), in which judgment
is given in his favor or he is acquitted, or in connection with any application
under Section 144(3), 144(4) or 727 of the Companies Act 1985 in which relief is
granted to him by the courtcourt.
Shire maintains an insurance policy for its directors and officers in
caserespect of honest and reasonable
conduct.
Insofar as indemnification for liabilities arising under the Securities
Actout of 1933 may be permitted toany act, error or omission while acting in
their capacities as directors officers or persons controlling the
registrant pursuant to the foregoing provisions, the registrant has been
informed that in the opinion of the Commission such indemnification is against
public policy as expressed in the Act and is therefore unenforceable.
-7-
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable by Shire in connection with sale
of the ordinary shares being registered (all amounts are estimated except the
SEC Registration Fee):
Amount to
Be Paid
-------
SEC Registration Fee................................. $84,739
Accounting Fees and Expenses......................... 25,000
Legal Fees and Expenses.............................. 25,000
Printing Expenses.................................... 20,000
Miscellaneous........................................ 5,261
--------
Total....................................... $160,000
========
Item 15. Indemnification Of Directors And Officers.
Except as hereinafter set forth, there is no charter provisions,
by-law, contract, arrangement or statute under which any director or officerofficers of Shire is insured or indemnified in any manner against any liability which he may
incur in his capacity as such.its affiliated companies.
Pursuant to Paragraph 141Article 138 of the Articles of Association of Shire Finance,
every person who wasdirector, agent or is a director, alternate director or secretaryofficer of Shire Finance shall be indemnified out of
the assets of Shire for all costs, charges, losses
and liabilities incurred in the proper execution of such person's duties or the
proper exercise of such person's powers, authorities and discretions.
Under Section 310 of the Companies Act, Shire may not indemnify an
officer against any liability that by virtue of any rule of law would otherwise
attach to him in respect of any negligence, default, breach of duty or breach of
trust of which he may be guilty in relation to Shire, except that under section
310(3) of the Companies Act, Shire is not prevented, inter alia, (a) from
purchasing and maintaining for any such officer such insurance against any such
liability, or (b) from indemnifying an officerFinance against any liability incurred by him as a result of
any act or failure to act in defending any proceedings (whether civilcarrying out his functions other than such
liability (if any) that he may incur by his own willful neglect or criminal), in which judgment
is given in his favor or he is acquitted, or in connection with any application
in which relief is granted to him by the court in case of honest and reasonable
conduct.
-8-default.
II-1
Item 16. ExhibitsEXHIBITS.
Exhibit
Number Description
3.1 Amended and Financial Statement Schedules.
(a) Exhibits
Exhibit No. Description
*3.1Restated Memorandum and Articles of Association of Shire
*4.1 FormFinance Limited
3.2* Memorandum and Articles of Association of Shire
4.1* Deposit Agreement among Shire Pharmaceuticals Group plc, Morgan Guaranty
Trust Company of New York and Holders from time to time of Shire'sShire ADSs
*4.24.2* Form of Ordinary Share certificate
*4.34.3* Form of ADR certificate (included within Exhibit 4.1)
5.1 Opinion of Slaughter & May regarding the validity of the
ordinary shares
*+10.1 License Agreement between Shire and Nycomed Pharma AS
dated January 14, 1987, as amended
*10.2 License Agreement between Shire and Nycomed Pharma AS
dated May 25, 1992
*+10.3 Agreement by and between Shire and Nycomed Pharma AS
dated September 27, 1993
*+10.4 Trademark License Agreement between Shire and Nycomed
Pharma AS dated October 23, 1995
*+10.5 License Agreement between Shire and Novartis Pharma A.G.
Limited4.4 Indenture dated August 31, 1995
*+10.6 Agreement between Shire and MacFarlan Smith Limited
dated June 16, 1997
*+10.7 Extraction Agreement between Shire and MacFarlan Smith
Limited dated June 16, 1997
*+10.8 License Agreement between Shire and Johnson Matthey plc
dated February 2, 1996
*+10.9 License Agreement between Shire, Johnson Matthey plc and
Anormed Inc. dated December 15, 1997
*+10.10 License Agreement between Shire and Johnson Matthey plc
dated December 15, 1997
*+10.11 License Agreement Shire and Synaptech Inc. dated
November 30, 1995
*+10.12 Agreement between Shire and Janssen Pharmaceutica N.V.
dated November 30, 1995
-9-
*+10.13 Global Co-Development, Know-how and Supply Agreement
between Shire an Janssen Pharmaceutica N.V. dated
November 30, 1995
*+10.14 Pharmaceutical Formulation License Agreement between
Shire and Hyal Pharmaceutical Corporation dated March 1,
1995
*+10.15 Development and License Agreement between Shire and
NeuroSearch A/S dated February 5, 1998
*10.16 Agreement and Plan of Merger among Shire and Richwood
Pharmaceutical Company, Inc. dated August 1, 1997
*10.17 SHL Scheme
*10.18 SPC Scheme
*10.19 Executive Scheme
*10.20 Sharesave Scheme
*10.21 Employee Stock Purchase Plan
**10.22 Asset Purchase Agreement among Shire, Shire Supplies
U.S. LLC, Arenol Corporation, Richard Vorisek and Robert
Jaeder dated March 5, 1999
**+10.23 Amendment Agreement to Global Co-Development, Know-How
and Supply Agreement between Shire and Janssen
Pharmaceutica N.V. dated July 22, 1999
**10.24 Agreement and Plan of Merger21, 2001 by and among Shire Finance Limited, Shire
Pharmaceuticals Group plc Ruby Acquisition Sub Inc. and Roberts Pharmaceutical CorporationThe Bank of New York, as Trustee
4.5 Form of 2% Senior Guaranteed Note due 2011 (included in Exhibit 4.4)
4.6 Registration Rights Agreement dated July 26, 1999
**10.25 ShareAugust 21, 2001, between Shire Finance
Limited, Shire Pharmaceuticals Group plc and Bear, Stearns International
Limited and Goldman Sachs International, as representatives of the Initial
Purchasers
4.7 Purchase Agreement among Fuiszdated August 15, 2001, between Shire Finance Limited,
Shire Pharmaceuticals Group plc and Bear, Stearns International Limited Fuisz Technologies Ltd. and
Shire Holdings
Europe LimitedGoldman Sachs International, as representatives of the Initial Purchasers
4.8 Preference Share Guarantee Agreement dated October 22, 1999
**10.26 Amended and Restated Credit AgreementAugust 21, 2001 among Shire
its
subsidiaries, various financial institutionsFinance Limited, Shire Pharmaceuticals Group plc and DLJ
Capital Funding, Inc.The Bank of New York,
as administrative agentGuarantee Trustee
4.9 Form of Shire Pharmaceuticals Group plc Guarantee
5.1** Opinion of Maples and syndication agent, dated November 19, 1999.
**21.1 ListCalder Europe
5.2 Opinion of subsidiariesCahill Gordon & Reindel
5.3 Opinion of Slaughter and May
8.1** Opinion of Maples and Calder Europe as to certain tax matters (included in
Exhibit 5.1)
8.2 Opinion of Cahill Gordon & Reindel as to certain tax matters
8.3 Opinion of Slaughter and May as to certain tax matters
12.1 Statement Regarding Computation of Ratio of Earnings to Fixed Charges
23.1 Consent of Arthur Andersen
Chartered AccountantsII-2
Exhibit
Number Description
23.2 Consent of Ernst & Young LLP
23.3 Consent of PricewaterhouseCoopers LLP
- -----------------Raymond Chabot Grant Thornton
23.4 Consent of Raymond Chabot Grant Thornton
23.5 Consent of Maples and Calder Europe (included in Exhibit 5.1)
23.6 Consent of Cahill Gordon & Reindel (included in Exhibit 5.2)
23.7 Consent of Slaughter and May (included in Exhibit 5.3)
23.8 Consent of Maples and Calder Europe (included in Exhibit 8.1)
23.9 Consent of Cahill Gordon & Reindel (included in Exhibit 8.1)
23.10 Consent of Slaughter and May (included in Exhibit 8.3)
24.1 Powers of Attorney (included on the signature pages of this registration
statement)
25.1 Form T-1 Statement of Eligibility of Trustee under the Indenture
99.1 Appointment of CT Corporation System as U.S. Agent for Service of Process
----------------------------------
* Incorporated by reference to the exhibits of Shire's Registration
Statement of Form F-1 (No. 333-8394).
-10-
** Incorporated by reference to Shire's Registration
Statement on Form F-4F-1 (No. 333-90947)333-8394).
+ Portions of this document, for which Shire has been granted
confidential treatment, have been redacted and** To be filed separately with
the Securities and Exchange Commission.by amendment.
Item 17. Undertakings.UNDERTAKINGS.
(A) The undersigned Registrantregistrants hereby undertakes:
(1) Toundertake:
1. to file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i)Registration Statement:
(a) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933 ("Securities Act);
(ii)Act;
(b) To reflect in the prospectus any facts or events arising after the
effective date of the registration statementRegistration Statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the registration statement.Registration Statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20
percent20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement;Registration Statement; and
(iii)(c) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statementRegistration Statement or any
material change to such information in the registration statement;Registration Statement;
provided, however, that paragraphs (1)(i)1(a) and (1)(ii)1(b) do not apply if the
information required to be included in asuch post-effective amendment by those paragraphs is
contained in a periodic reportsreport filed by Shire pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934and incorporated herein by reference.
II-3
2. that, are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To3. to remove from registration by means of a post-effective amendment any of
the securities being registered which remain unsold at the termination of
the offering.
(4) That,4. that, for purposes of determining any liability under the Securities Act,
each filing of the registrant'san annual report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the registration statementRegistration
Statement shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
-11-
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
The undersigned registrant hereby undertakes to file, if necessary, an
application for the purpose of determining the eligibility of the Trustee to act
under subsection (a) of Section 310 of the Trust Indenture Act of 1939, as
amended, in accordance with the rules and regulations prescribed by the
Securities and Exchange Commission under Section 605(b)(2) of such Act.
The undersigned registrant hereby undertakes to deliver or cause to be
delivered with the prospectus, to each person to whom the prospectus is sent or
given, the latest annual report to security holders that is incorporated by
reference in the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by
Article 3 of Regulation S-X is not set forth in the prospectus, to deliver, or
cause to be delivered to each person to whom the prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the prospectus to provide such interim financial information.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the
Securities Act of 1933, the information omitted from the form of
prospectus filed as part of this registration statement in reliance
upon Rule 430A and contained in a form of prospectus filed by the
registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the
Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a
form of prospectus shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.(B) Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrantundersigned pursuant to the foregoing provisions described under Item 15 above, or
otherwise, the registrant hasundersigned have been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by the registrantundersigned of expenses incurred or paid by
a director, officer or controlling person of such registrantthe undersigned in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities
being registered, the registrantundersigned will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question of whether such
indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such
issue.
-12-II-4
SIGNATURES
Pursuant to the requirements of the Securities Act the registrantof 1933, Shire Finance
Limited certifies that it has reasonable grounds to believe that it meets all of
the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the Town of Andover,Basingstoke, England, on the 19th day of June, 2000.November 6, 2001.
SHIRE PHARMACEUTICALS GROUP PLC
ByFINANCE LIMITED
By: /s/Rolf Stahel
----------------------------------------
Name: Rolf Stahel
Chief ExecutiveTitle: Chairman of the Board
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Rolf Stahel and Angus Russell, and Neil Harris, and
each of them acting individually, as his attorney-in-fact, each with full power
of substitution, for him 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 exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, hereby ratifying and
confirming our signatures as they may be signed by our said attorney to any and
all amendments to said Registration Statement.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.
Name CapacitySignature Title Date
---- ----------------- ----- ----
/s/ Rolf Stahel Chairman of the Board November 6, 2001
-----------------------------
Name: Rolf Stahel
/s/ Angus Russell Director November 6, 2001
-----------------------------
Name: Angus Russell
/s/ William Nuerge Authorized Representative in the United States November 6, 2001
-----------------------------
Name: William Nuerge
II-5
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Shire
Pharmaceuticals Group plc certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly caused
this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the Town of Basingstoke, England, on November 6,
2001.
SHIRE PHARMACEUTICALS GROUP PLC
By: /s/ Rolf Stahel
--------------------------
Name: Rolf Stahel
Title: Chief Executive
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Rolf Stahel and Angus Russell, and
each of them acting individually, as his attorney-in-fact, each with full power
of substitution, for him 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 exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, hereby ratifying and
confirming our signatures as they may be signed by our said attorney to any and
all amendments to said Registration Statement.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ James Cavanaugh Non-executive Chairman November 6, 2001
-----------------------------
Name: James Cavanaugh
/s/ Rolf Stahel Chief Executive Officer June 19, 2000
- --------------------------------------- (Principal executive officer) November 6, 2001
-----------------------------
Name: Rolf Stahel
/s/ Angus Russell Group Finance Director June 19, 2000
- --------------------------------------- (Principal financial November 6, 2001
----------------------------- officer and
Angus Russell principal accounting officer)
/s/ James Cavanaugh Director, Non-executive June 19, 2000
- ---------------------------------------
Dr. James CavanaughName: Angus Russell
/s/ Wilson Totten Group R&D Director June 19, 2000
- ---------------------------------------
Dr.November 6, 2001
-----------------------------
Name: Wilson Totten
/s/ Barry Price Director, Non-executive June 19, 2000
- ---------------------------------------
Dr.November 6, 2001
-----------------------------
Name: Barry Price
-13-
/s/ Bernard Canavan Director, Non-executive June 19, 2000
- ---------------------------------------
Dr.November 6, 2001
-----------------------------
Name: Bernard Canavan
/s/ Zola HorovitzRonald Nordman Director, Non-executive June 19, 2000
- ---------------------------------------
Dr. Zola Horovitz
/s/November 6, 2001
-----------------------------
Name: Ronald Nordmann
Director, Non-executive
June 19, 2000
- ---------------------------------------
Ronald Nordmann-----------------------------
Name: Francesco Bellini
II-6
/s/ Joseph SmithJamees Grant Director, Non-executive June 19, 2000
- ---------------------------------------
Joseph SmithNovember 6, 2001
-----------------------------
Name: James Grant
/s/ John SpitznagelGerard Veilleux Director, Non-executive June 19, 2000
- ---------------------------------------
John SpitznagelNovember 6, 2001
-----------------------------
Name: Gerard Veilleux
/s/ William Nuerge Authorized Representative in the United States November 6, 2001
-----------------------------
Name: William Nuerge
-14-II-7
EXHIBIT INDEX
Exhibit
Number Description
3.1 Amended and Restated Memorandum and Articles of Association of Shire
Finance Limited
3.2* Memorandum and Articles of Association of Shire
4.1* Deposit Agreement among Shire Pharmaceuticals Group plc, Morgan Guaranty
Trust Company of New York and Holders from time to time of Shire ADSs
4.2* Form of Ordinary Share certificate
4.3* Form of ADR certificate (included within Exhibit 4.1)
4.4 Indenture dated August 21, 2001 by and among Shire Finance Limited, Shire
Pharmaceuticals Group plc and The Bank of New York, as Trustee
4.5 Form of 2% Senior Guaranteed Note due 2011 (included in Exhibit 4.4)
4.6 Registration Rights Agreement dated August 21, 2001, between Shire Finance
Limited, Shire Pharmaceuticals Group plc and Bear, Stearns International
Limited and Goldman Sachs International, as representatives of the Initial
Purchasers
4.7 Purchase Agreement dated August 15, 2001, between Shire Finance Limited,
Shire Pharmaceuticals Group plc and Bear, Stearns International Limited and
Goldman Sachs International, as representatives of the Initial Purchasers
4.8 Preference Share Guarantee Agreement dated August 21, 2001 among Shire
Finance Limited, Shire Pharmaceuticals Group plc and The Bank of New York,
as Guarantee Trustee
4.9 Form of Shire Pharmaceuticals Group plc Guarantee
5.1** Opinion of Maples and Calder Europe
5.2 Opinion of Cahill Gordon & Reindel
5.3 Opinion of Slaughter and May
8.1** Opinion of Maples and Calder Europe as to certain tax matters (included in
Exhibit 5.1)
8.2 Opinion of Cahill Gordon & Reindel as to certain tax matters
8.3 Opinion of Slaughter and May as to certain tax matters
12.1 Statement Regarding Computation of Ratio of Earnings to Fixed Charges
23.1 Consent of Arthur Andersen
II-8
Exhibit
Number Description
23.2 Consent of Ernst & Young LLP
23.3 Consent of Raymond Chabot Grant Thornton
23.4 Consent of Raymond Chabot Grant Thornton
23.5 Consent of Maples and Calder Europe (included in Exhibit 5.1)
23.6 Consent of Cahill Gordon & Reindel (included in Exhibit 5.2)
23.7 Consent of Slaughter and May (included in Exhibit 5.3)
23.8 Consent of Maples and Calder Europe (included in Exhibit 8.1)
23.9 Consent of Cahill Gordon & Reindel (included in Exhibit 8.1)
23.10 Consent of Slaughter and May (included in Exhibit 8.3)
24.1 Powers of Attorney (included on the signature pages of this registration
statement)
25.1 Form T-1 Statement of Eligibility of Trustee under the Indenture
99.1 Appointment of CT Corporation System as U.S. Agent for Service of Process
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* Incorporated by reference to the exhibits to Shire's Registration
Statement on Form F-1 (No. 333-8394).
** To be filed by amendment.