def14a
DEFINITIVE NOTICE AND PROXY STATEMENT
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant To Section 14(A) of the Securities
Exchange Act of 1934
Filed by the Registrant þ
Filed By a Party other than the Registrant o
Check the appropriate box:
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Preliminary Proxy Statement |
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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
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Definitive Proxy Statement |
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Definitive Additional Materials |
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Soliciting Material Pursuant to §240.14a-12 |
SIPEX CORPORATION
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the Appropriate Box):
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No fee required. |
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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
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Title of each class of securities to which transaction applies: |
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Aggregate number of securities to which transaction applies: |
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Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined): |
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Proposed maximum aggregate value of transaction: |
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Fee paid previously with preliminary materials. |
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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and
identify the filing for which the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the Form or Schedule and the date of its filing. |
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Amount Previously Paid: |
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Form, Schedule or Registration Statement No.: |
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Filing Party: |
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Date Filed: |
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233 South
Hillview Drive
Milpitas, California 95035
To the
Stockholders:
NOTICE IS HEREBY GIVEN that a Special Meeting of Stockholders of
SIPEX Corporation, a Delaware corporation (the
Company), will be held at the Companys
corporate offices, located at 233 South Hillview Drive,
Milpitas, California 95035 on Tuesday, January 30, 2007, at
10:00 a.m., local time, for the purposes of considering and
acting upon the following matters:
I. To approve the grant of discretionary authority to the
Board of Directors to amend the Companys Amended and
Restated Certificate of Incorporation to effect a reverse stock
split of the Companys issued common stock at any time
prior to March 30, 2007, at one of the following ratios
(the exact ratio to be determined by the Board of Directors):
one share for one and one-half shares; one share for two shares;
or one share for two and one-half shares.
II. To transact such other business as may properly come
before the meeting or any adjournments thereof.
Information relating to the above matters is set forth in the
attached Proxy Statement. Only stockholders of record at the
close of business on December 14, 2006 will be entitled to
notice of and to vote at the meeting and any adjournment thereof.
All stockholders are cordially invited to attend the meeting.
By Order of the Board of Directors,
CLYDE R. WALLIN
Secretary
Milpitas, California
Date: December 28, 2006
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE READ
THE ATTACHED PROXY STATEMENT AND THEN COMPLETE, DATE AND SIGN
THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE ENCLOSED ENVELOPE
IN ORDER TO ENSURE REPRESENTATION OF YOUR SHARES AT THE
MEETING. NO POSTAGE NEEDS TO BE AFFIXED IF THE PROXY IS MAILED
IN THE UNITED STATES.
SIPEX
CORPORATION
233 South Hillview Drive
Milpitas, California 95035
PROXY STATEMENT
FOR A SPECIAL MEETING OF
STOCKHOLDERS
To Be Held January 30th, 2007
This Proxy Statement is furnished in connection with the
solicitation of proxies by the Board of Directors of Sipex
Corporation (Sipex or the Company) for
use at a Special Meeting of Stockholders (the Special
Meeting) to be held at the Sipexs corporate offices,
located at 233 South Hillview Drive, Milpitas, California 95035
on January 30, 2007, at 10:00 a.m., local time, and at
any adjournments thereof.
Only stockholders of record as of the close of business on
December 14, 2006, the record date fixed by the Board of
Directors, will be entitled to notice of, and to vote at, a
Special Meeting and at any adjournments thereof. At the close of
business on December 14, 2006, there were an aggregate of
35,785,885 shares of Common Stock, par value $0.01 per
share (the Common Stock), of the Company issued,
outstanding and entitled to vote. The holders of Common Stock
are entitled to one vote per share on any proposal presented at
a Special Meeting. Stockholders may vote in person or by proxy.
Execution of a proxy will not in any way affect a
stockholders right to attend the meeting and vote in
person.
It is anticipated that this Proxy Statement and the accompanying
proxy will be first mailed to stockholders on or about
December 28, 2006.
ALL PROXIES WILL BE VOTED IN ACCORDANCE WITH THE
STOCKHOLDERS INSTRUCTIONS, AND IF NO CHOICE IS SPECIFIED,
THE ENCLOSED PROXY CARD (OR ANY SIGNED AND DATED COPY THEREOF)
WILL BE VOTED IN FAVOR OF THE MATTERS SET FORTH IN THE
ACCOMPANYING NOTICE OF MEETING.
The Board of Directors knows of no other matter to be presented
at a Special Meeting. If any other matter upon which a vote may
properly be taken should be presented at a Special Meeting,
shares represented by all proxies received by the Board of
Directors will be voted with respect thereto in accordance with
the judgment of the persons named as attorneys in the proxies.
Quorum
and Votes Required
The representation, in person or by proxy, of at least a
majority of the issued and outstanding shares of Common Stock
entitled to vote at the Special Meeting is necessary to
constitute a quorum for the transaction of business. Shares
represented by proxies pursuant to which votes have been
withheld from any nominee for director, or which contain one or
more abstentions or broker non-votes, are counted as
present or represented for purposes of determining the presence
or absence of a quorum for the Special Meeting. A
non-vote occurs when a broker or other nominee
holding shares for a beneficial owner returns a proxy but the
broker does not have discretionary voting power with respect to
a particular proposal and has not received instructions from the
beneficial owner.
An affirmative vote of a majority of the Common Stock
outstanding on the record date of December 14, 2006 is
necessary to approve the proposal to amend Sipexs amended
and restated certificate of incorporation, to effect the reverse
split of the outstanding shares of Sipexs Common Stock.
The persons named as agents in the proxies are officers of the
Company. All properly executed proxies returned in time to be
counted at the Special Meeting will be voted.
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Revocability
of Proxies
Any person giving a proxy in response to this solicitation has
the power to revoke it at any time prior to the time that the
proxy is voted at the Special Meeting. Proxies may be revoked by
any of the following actions:
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delivering a written notice to our Corporate Secretary at our
principal executive offices (233 South Hillview Drive, Milpitas,
California 95035) bearing a date later than the date of the
proxy stating that the proxy is revoked;
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signing and delivering a later-dated proxy relating to the same
shares to our Corporate Secretary at our principal executive
offices;
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delivering a later-dated proxy using the telephone voting
procedures described on the enclosed proxy card; and
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attending the Special Meeting and voting in person (although
attendance at the meeting will not, by itself, revoke a proxy).
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If your shares are held in street name by your
broker, you must follow the directions received from your broker
to change your vote.
Multiple
Stockholders Sharing One Address
In some instances, we may deliver to multiple stockholders
sharing a common address only one copy of this proxy statement
and its attachments. If requested by phone or in writing, we
will promptly provide a separate copy of the proxy statement and
its attachments to a stockholder sharing an address with another
stockholder. Requests by phone should be directed to our
Corporate Secretary at
(408) 934-7500,
and requests in writing should be sent to Sipex Corporation,
Attention: Corporate Secretary, 233 South Hillview Drive,
Milpitas, California 95035. Stockholders sharing an address who
currently receive multiple copies and wish to receive only a
single copy should contact their broker or send a signed,
written request to us at the address above.
PROPOSAL I
TO APPROVE THE GRANT OF DISCRETIONARY AUTHORITY TO THE BOARD
OF DIRECTORS TO AMEND THE COMPANYS AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION TO EFFECT A REVERSE STOCK SPLIT OF
THE COMPANYS ISSUED COMMON STOCK AT ANY TIME PRIOR TO
MARCH 30, 2007, AT ONE OF THE FOLLOWING RATIOS (THE EXACT
RATIO TO BE DETERMINED BY THE BOARD OF DIRECTORS): ONE SHARE FOR
ONE AND ONE-HALF SHARES; ONE SHARE FOR TWO SHARES; OR ONE SHARE
FOR TWO AND ONE-HALF SHARES.
General
At the Companys annual meeting of stockholders held
November 30, 2006, the Companys stockholders approved
an amendment to the Companys Amended and Restated
Certificate of Incorporation which would effect a reverse split
of the Companys Common Stock (a Reverse Split)
at a ratio of one post-split share for three pre-split shares.
Upon further consideration of factors affecting the
Companys capitalization and with the passage of time, the
Board of Directors believes that it is in the best interest of
the Company and its stockholders to approach a Reverse Split, if
at all, with a greater degree of flexibility.
Accordingly, while retaining its authority to effect the
one-for-three
Reverse Split approved at the annual meeting, the Board of
Directors has adopted a resolution approving, declaring
advisable and recommending to the stockholders for their
approval three potential amendments to the Companys
Amended and Restated Certificate of Incorporation (the
Amendments and each, an Amendment). Each
individual Amendment would effect a Reverse Split at different
ratio of post-split shares for pre-split shares. The first such
Amendment would effect a Reverse Split at a ratio of one
post-split share for one and one-half pre-split shares. The
second such Amendment would effect a Reverse Split at a ratio of
one post-split share for two pre-split shares. The third such
Amendment
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would effect a Reverse Split at a ratio of one post-split share
for two and one-half pre-split shares. Except for the different
ratios at which the Amendments would effect a Reverse Split,
they are identical in every respect. Each Amendment would give
effect to a Reverse Split of the Companys issued and
outstanding Common Stock, but none would change the number of
authorized shares or par value of the Companys Common
Stock or preferred stock. Except for any changes as a result of
the treatment of fractional shares, each stockholder will hold
the same percentage of Common Stock outstanding immediately
following the Reverse Split as such stockholder held immediately
prior to the Reverse Split. The form of each proposed Amendment
is included in this proxy statement at Appendix A.
As described above, the Board of Directors currently has the
authority to effect a Reverse Split at a ratio of one post-split
share for three pre-split shares. If this proposal is approved,
the Board of Directors would have the additional authority and
discretion, at any time prior to March 30, 2007 to file any
one of the Amendments with the Secretary of State of Delaware
and, accordingly, to effect a Reverse Split at any one of the
aforementioned ratios. In no event would the Board of Directors
be authorized to effect more than one Reverse Split. To effect
the Reverse Split, the Board of Directors would set the timing
for such a split and select a specific ratio from among the
three ratios described above. No further action on the part of
the stockholders will be required to implement or abandon the
Reverse Split. If the proposal is approved by the stockholders,
and the Board of Directors determines to implement the Reverse
Split at any of the above-described ratios, the Company would
communicate to the public, prior to the effective date of the
Reverse Split, additional details regarding the Reverse Split,
including the specific ratio selected by the Board of Directors.
Even if this proposal is approved, the Board of Directors may in
its discretion decline to effect a Reverse Split if it
determines that a Reverse Split is not in the best interest of
the Company and its stockholders. If the Board of Directors
declines to effect a Reverse Split, the Company would not file
any of the Amendments or the amendment approved at the annual
meeting. If the Board of Directors does not implement the
Reverse Split prior to March 30, 2007, the authority
granted in this proposal to implement the Reverse Split would
terminate. The authority obtained by the Board of Directors at
the annual meeting to effect a
one-for-three
Reverse Split is not limited in time.
Purpose
The Board of Directors approved seeking the stockholders
approval for the Amendments and the various Reverse Split Ratios
because (i) the Board of Directors believes that a Reverse
Stock split is an effective means for the Company to meet the
listing requirements of Nasdaq Global Market so that the
Companys Common Stock may be listed on the Nasdaq Global
Market and (ii) because the Board of Directors believes a
higher stock price may help generate investor interest in the
Company. The Board of Directors is seeking approval for the
three Amendments (rather than going forward with only a single
exchange ratio for the Reverse Split) because the Amendments
would provide the Board of Directors additional flexibility to
achieve the desired results of the Reverse Split.
Nasdaq Global Market Listing. Sipexs
common stock is currently quoted on the Pink Sheets electronic
quotation system under the symbol SIPX.PK. The Board
of Directors believes that listing on the Nasdaq Global Market
would provide a broader market for Sipexs common stock and
would facilitate the use of Sipexs common stock in
financing transactions. The Board of Directors approved the
reverse stock split proposal partly as a means, if necessary, of
increasing the share price of Sipexs common stock above
$5.00 per share to meet the listing requirement of Nasdaq
Global Market.
Potential Increased Investor Interest. In
seeking stockholder approval for authority to effect a reverse
stock split, the Board of Directors considered that the low
trading price of Sipexs common stock may discourage
brokerage firms from recommending it to their clients. Moreover,
the analysts at many brokerage firms do not monitor the trading
activity or otherwise provide coverage of lower priced stocks.
Also, the Board of Directors believes that many investment funds
may be reluctant to invest in lower priced stocks for a variety
of reasons, including increased price volatility.
The Board of Directors will consider a variety of factors in
determining the appropriate ratio and timing of the Reverse
Split or whether to implement the Reverse Stock Split at all.
The primary factor the Board of Directors will consider is the
Companys stock price during the period following approval
by the stockholders. The Board of Directors will balance the
goal of achieving a stock price that is viewed as attractive to
stockholders, will help attract
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and retain employees and will enable the Nasdaq Global Market
Listing against the risk of reducing the number of outstanding
shares of common stock by an amount that will reduce the
liquidity in the shares of common stock that remain outstanding
following the Reverse Split. In this regard, the Board of
Directors is contemplating a stock price as a result of the
Reverse Split of between $5.00 and $10.00 per share.
However, we cannot assure you that our Board of Directors will
ultimately select a price within this range or that our stock
will trade in the range selected by the Board following the
Reverse Split or ever. Given the factors being considered, the
Board may still decide to implement a Reverse Split even if one
is not required to attain the Nasdaq Global Market Listing.
Nonetheless, the Board of Directors is seeking the broader
discretion associated with this proposal as opposed to the one
already approved for the
one-for-three
Reverse Split so as to have greater ability to accomplish the
stated objectives.
A Reverse Split May Not Result in an Increase in the Per
Share Price of Our Common Stock; There Are Other Risks
Associated With a Reverse Split
We cannot be certain whether a Reverse Split would increase the
trading price for our Common Stock. The history of similar stock
split combinations for companies in like circumstances is
varied. There is no assurance that:
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the trading price per share of our Common Stock after a Reverse
Split would rise in proportion to the reduction in the number of
pre-split shares of Common Stock outstanding before Reverse
Split;
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the market price per post-split share would either exceed or
remain in excess of the $5.00 minimum price as required by the
Nasdaq Global Market for Sipexs Common Stock to be listed
or that we would otherwise meet the requirements of Nasdaq for
listing on the Nasdaq Global Market; and
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a Reverse Split would result in a per share price that would
attract brokers and investors who do not trade in lower priced
stocks.
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The market price of our Common Stock would also be based on our
performance and other factors, some of which are unrelated to
the number of shares outstanding. If a Reverse Split is
consummated and the trading price of our Common Stock declines,
the percentage decline as an absolute number and as a percentage
of our overall market capitalization may be greater than would
occur in the absence of a Reverse Split. Furthermore, the
liquidity of our Common Stock could be adversely affected by the
reduced number of shares that would be outstanding after a
Reverse Split.
Principal
Effects of a Reverse Split
If effected by the Board of Directors, a Reverse Split would
occur simultaneously for all of the Companys Common Stock
and the ratio selected by the Board of Directors would be the
same for all of such shares. Any Reverse Split would affect all
stockholders uniformly and would not affect any
stockholders percentage ownership interest in the Company,
except to the extent that such Reverse Split would otherwise
result in any stockholder owning a fractional share. As
described below under Effect on Fractional
Stockholders, registered stockholders otherwise entitled
to fractional shares would be entitled to cash payments in lieu
of such fractional shares. Such cash payments would reduce the
number of post-split stockholders to the extent there are
stockholders who otherwise would be entitled to receive less
than one common share of the Company after the Reverse Split.
This, however, is not the purpose for which Sipexs Board
of Directors is recommending the reverse stock split. In
addition, the reverse stock split would not affect any
stockholders proportionate voting rights (subject to the
treatment of fractional shares). Each share of Common Stock
outstanding after a Reverse Split would be entitled to one vote
and would remain fully paid and non-assessable. Sipex would
continue to be subject to the periodic reporting requirements of
the Exchange Act.
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The principal effects of a Reverse Split would be that:
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Based on shares outstanding as of December 14, 2006, the
effect of a Reverse Split on the Companys issued and
outstanding shares of Common Stock and Common Stock available
for future issuance would be as illustrated by the following
table:
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Prior to
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1-for-1.5
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1-for-2
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1-for-2.5
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1-for-3
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Shares
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Reverse Split
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Reverse Split
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Reverse Split
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Reverse Split
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Reverse Split
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Authorized
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60,000,000
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60,000,000
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60,000,000
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60,000,000
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60,000,000
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Issued and outstanding
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35,785,885
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23,857,256
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17,892,942
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14,314,354
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11,928,628
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Available for future issuance
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24,214,115
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36,142,744
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42,107,058
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45,685,646
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48,071,372
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The exercise or conversion price and the number of shares of
Common Stock issuable under the Companys outstanding
warrants and options and any other similar rights or securities
would be proportionately adjusted upon the reverse stock split
based on the ratio of such Reverse Split.
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As of the December 14, 2006, the Company had 61 holders of
record of its Common Stock. Reverse Splits are not being
considered and would not be effected as the first step in a
going private transaction under
Rule 13e-3
of the Securities Exchange Act of 1934, and such a transaction
is not the purpose for which the Company is contemplating a
Reverse Split. However, we cannot assure you that neither we nor
any of our affiliates will not take steps in the future that
will result in a going private transaction under
Rule 13e-3.
A reduction in the number of outstanding shares of the
Companys Common Stock could result in decreased liquidity
in Sipexs Common Stock. In addition, a Reverse Split could
result in some stockholders owning odd lots of less
than one hundred (100) shares of the Companys Common
Stock on a post-split basis. Odd lots may be more difficult to
sell, or may require greater transaction costs per share to sell
than do board lots of even multiples of one under
(100) shares.
Effect on Fractional Stockholders. No scrip or
fractional shares would be issued if, as a result of a Reverse
Split, a registered stockholder would otherwise become entitled
to a fractional share. Instead, the Company would pay to the
registered stockholder, in cash, the value of any fractional
share interest arising from the Reverse Split. The cash payment
would equal the fraction to which the stockholder would
otherwise be entitled multiplied by the average of the closing
prices (as adjusted to reflect the Reverse Split) of our Common
Stock, during the ten (10) trading days preceding the date
that is five (5) days before the effective time of the
Reverse Split. If such price is not available, the fractional
share payment would be based on the average of the last bid and
ask prices of our Common Stock on such days or other prices
determined by the Board of Directors. No transaction costs would
be assessed to stockholders for the cash payment. Stockholders
would not be entitled to receive interest for the period of time
between the effective date of the reverse stock split and the
date payment is made for their fractional shares.
If you do not hold sufficient shares of pre-split Common Stock
to receive at least one post-split share of Common Stock and you
want to hold Sipexs Common Stock after the reverse stock
split, you may do so by taking either of the following actions
far enough in advance so that it is completed before the Reverse
Split is effected:
(1) purchase a sufficient number of shares of Common Stock
so that you would hold at least that number of shares of Common
Stock in your account prior to the implementation of the Reverse
Split that would entitle you to receive at least one common
share on a post-split basis; or
(2) if applicable, consolidate your accounts so that you
hold at least that number of shares of the Companys Common
Stock in one account prior to the Reverse Split that would
entitle you to at least one share of Common Stock on a post-
split basis. Common Stock held in registered form (that is,
shares held by you in your own name on the Companys share
register maintained by its transfer agent) and Common Stock held
in street name (that is, shares held by you through
a bank, broker or other nominee) for the same investor would be
considered held in separate accounts and would not be aggregated
when implementing the Reverse Split. Also, shares of our Common
Stock held in registered form, but in separate accounts by the
same investor, would not be aggregated when implementing the
Reverse Split.
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After the Reverse Split, then current stockholders would have no
further interest in the Company with respect to their fractional
shares. A person otherwise entitled to a fractional share
interest would not have any voting, dividend or other rights in
respect of their fractional interest except to receive the cash
payment as described above. Such cash payments would reduce the
number of post-split stockholders to the extent that there are
stockholders holding fewer than the number of pre-split shares
combined into a single post-split share by operation of the
Reverse Split. This, however, is not the purpose for which the
Company is effecting the Reverse Split.
Stockholders should be aware that, under the escheat laws of the
various jurisdictions where stockholders reside, where Sipex is
domiciled and where the funds would be deposited, sums due to
stockholders in payment for fractional shares that are not
timely claimed after the effective time may be required to be
paid to the designated agent for each such jurisdiction.
Thereafter, stockholders otherwise entitled to receive such
funds may have to seek to obtain them directly from the state to
which they were paid.
Effect on Non-registered
Stockholders. Non-registered stockholders holding
their common shares through a bank, broker or other nominee
should note that such banks, brokers or other nominees may have
different procedures for processing the consolidation than those
that would be put in place by the Company for registered
stockholders, and their procedures may result, for example, in
differences in the precise cash amounts being paid by such
nominees in lieu of fractional share. If you hold your shares
with such a bank, broker or other nominee and if you have
questions in this regard, you are encouraged to contact your
nominee.
Effect on Authorized Shares. The number of
authorized shares of common stock would not be effected by the
Reverse Split. The Company would continue to have sixty million
(60,000,000) authorized shares of Common Stock. The Company also
would continue to have one million (1,000,000) authorized shares
of preferred stock.
Effect on Accounting Matters. The Reverse
Split would not affect the par value of Sipexs Common
Stock. As a result, on the effective date of the Reverse Split,
the stated capital on Sipexs balance sheet attributable to
Sipexs Common Stock would be reduced in proportion to the
ratio of the Reverse Split. The per share net income or loss and
net book value of Sipexs Common Stock would be increased
because there would be fewer shares of Sipexs Common Stock
outstanding.
Potential Anti-Takeover Effect. Although the
increased proportion of unissued authorized shares to issued
shares could, under certain circumstances, have an anti-takeover
effect (for example, by permitting issuances that would dilute
the stock ownership of a person seeking to effect a change in
the composition of Sipexs Board of Directors or
contemplating a tender offer or other transaction for the
combination of Sipex with another company), the Reverse Split
proposal is not being proposed in response to any effort of
which we are aware to accumulate Sipexs shares of Common
Stock or obtain control of Sipex, nor is it part of a plan by
management to recommend a series of similar amendments to
Sipexs Board of Directors and stockholders.
Effect on Stock Certificates. If Sipexs
stockholders approve the Amendments and if the Board of
Directors elects to effect a Reverse Split, the Company would
file either the amendment to the Companys Amended and
Restated Certificate of Incorporation approved at the annual
meeting or one of the Amendments with the Secretary of State of
the State of Delaware. The Reverse Split would become effective
at the time specified by such amendment, which we refer to as
the effective time.
If the stockholders approve the Amendments and the Board of
Directors elects to effect a Reverse Split, registered
stockholders will be sent a transmittal letter from the
Companys transfer agent as soon as practicable after the
effective date of such Reverse Split. The letter of transmittal
would contain instructions on how to surrender your
certificate(s) representing your pre-split shares to the
transfer agent. The transfer agent would forward to each
registered stockholder who has sent the required documents a new
share certificate representing the number of post-split shares
of Common Stock to which the stockholder is entitled. Until
surrendered, each share certificate representing pre-split
shares of the Common Stock of the Company would be deemed for
all purposes to represent the number of whole shares of
post-split common shares, and the right to receive a cash
payment in lieu of any fractional shares (without interest), to
which the holder is entitled as a result of the Reverse Split.
If a registered stockholder is entitled to a payment in lieu of
any fractional share, such payment would be made as described
above under Effect on Fractional Stockholders.
8
STOCKHOLDERS SHOULD NOT DESTROY ANY STOCK CERTIFICATE(S) AND
SHOULD NOT SUBMIT ANY STOCK CERTIFICATE(S) UNTIL REQUESTED TO DO
SO.
No
Dissenters Rights
Under the Delaware General Corporation Law, Sipexs
stockholders are not entitled to dissenters rights with
respect to any Reverse Split, and the Company is not
independently providing and has not so provided stockholders
with any such right.
Federal
Income Tax Consequences of the Reverse Stock Split
The following is a summary of certain material federal income
tax consequences of a Reverse Split and does not purport to be a
complete discussion of all of the possible federal income tax
consequences of any Reverse Split and is included for general
information only. Further, it does not address any state, local
or foreign income or other tax consequences. For example, the
state and local tax consequences of the Reverse Split may vary
significantly as to each stockholder, depending upon the state
in which he or she resides. Also, it does not address the tax
consequences to holders that are subject to special tax rules,
such as banks, insurance companies, regulated investment
companies, personal holding companies, foreign entities,
nonresident alien individuals, broker-dealers and tax-exempt
entities. The discussion is based on the provisions of the
United States federal income tax law as of the date hereof,
which is subject to change retroactively as well as
prospectively. This summary also assumes that the pre-split
shares were, and the post-split shares would be, held as a
capital asset, as defined in the Internal Revenue
Code of 1986, as amended (the Code) (i.e.,
generally, property held for investment). The tax treatment of a
stockholder may vary depending upon the particular facts and
circumstances of such stockholder. Each stockholder is urged to
consult with such stockholders own tax advisor with
respect to the tax consequences of the reverse stock split.
Other than the cash payments for fractional shares discussed
below, no gain or loss should be recognized by a stockholder
upon such stockholders exchange of pre-split shares for
post-split shares pursuant to the Reverse Split. The aggregate
tax basis of the post-split shares received in the Reverse Split
(including any fraction of a post-split share deemed to have
been received) would be the same as the stockholders
aggregate tax basis in the pre-split shares exchanged therefor.
In general, stockholders who receive cash upon redemption of
their fractional share interests in the post-split shares as a
result of the Reverse Split would recognize gain or loss based
on their adjusted basis in the fractional share interests
redeemed. The federal income tax liability, if any, generated by
the receipt of cash in lieu of a fractional interest should not
be material in amount in view of the low value of the fractional
interest. The stockholders holding period for the
post-split shares would include the period during which the
stockholder held the pre-split shares surrendered in the Reverse
Split.
Our view regarding the tax consequence of the Reverse Split is
not binding on the Internal Revenue Service or the courts.
Accordingly, each stockholder should consult with his or her own
tax advisor with respect to all of the potential tax
consequences to him or her of the Reverse Split.
Vote
Required; Recommendation of Board
The affirmative vote of the holders of a majority of the shares
of our issued and outstanding Common Stock entitled to vote will
be required to approve this Proposal I.
OUR BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE
FOR THE APPROVAL OF PROPOSAL I.
9
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth as of December 13, 2006
information to the best of our knowledge, with respect to the
beneficial ownership of the Companys Common Stock by
(i) each person who is known to the Company to be the
beneficial owner of more than five percent of its Common Stock,
(ii) each director of the Company, (iii) each of our
executive officers , and (iv) all directors and executive
officers of the Company as a group. Except as otherwise
indicated in the footnotes to the table, the beneficial owners
listed have sole voting and investment power (subject to
community property laws where applicable) as to all of the
shares beneficially owned by them. As of December 13, 2006,
there were 35,792,335 shares of common stock outstanding.
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Name and Address of
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Total Amount and Nature of
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Beneficial Owner(1)
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Beneficial Ownership
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Percent of Class
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Alonim Investments, Inc.(2)
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16,296,200
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45.8
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%
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237 Hymus Blvd. Montreal
(Pointe-Claire),
Quebec H9R 5C7 Canada
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Kennedy Capital Management, Inc.(3)
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2,718,967
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7.6
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%
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10829 Olive Blvd.
St. Louis, MO 63141
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Wasatch Advisors, Inc.(4)
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1,899,690
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5.3
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%
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150 Social Hall Avenue,
4th Floor,
Salt Lake City, UT 84111
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Dimensional Fund Advisors(5)
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1,782,770
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5.0
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%
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1299 Ocean Avenue,
11th Floor
Santa Monica, CA 90401
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Ralph Schmitt(6)
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395,833
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1.1
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%
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Lee Cleveland(7)
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216,400
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*
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Richard Hawron(8)
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171,345
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*
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Clyde R. Wallin(9)
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156,250
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*
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Edward Lam(10)
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141,666
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*
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Joel Camarda(11)
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78,125
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*
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John Arnold(12)
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56,625
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*
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Brian Hilton(13)
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41,250
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*
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Thomas P. Redfern(14)
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35,625
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*
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Daniel G. Casey(15)
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2,500
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*
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Pierre Guilbault (16)
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2,500
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*
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Alan F. Krock(17)
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2,500
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*
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All directors and executive
officers as a group (12 persons)
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1,300,619
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3.5
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%
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* |
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Less than 1% of Common Stock |
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(1) |
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Unless otherwise indicated, to the knowledge of the Company,
each person listed above has sole voting and investment power
with respect to the shares and maintains a mailing address at:
c/o SIPEX Corporation, 233 South Hillview Drive,
Milpitas, CA 95035. |
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(2) |
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Based solely on information provided in a Schedule 13G/A
filed with the Securities and Exchange Commission on
January 25, 2006, Alonim Investments had sole dispositive
power of 16,296,200 shares and sole voting power of
16,296,200 shares. |
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(3) |
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Based solely on information provided in a Schedule 13G
filed with the Securities and Exchange Commission
December 31, 2005, Kennedy Capital Management, Inc. had
sole dispositive power of 2,718,967 shares, and sole voting
power of 2,718,967 shares. |
10
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(4) |
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Based solely on information provided in a Schedule 13G
filed with the Securities and Exchange Commission on
February 14, 2005, Wasatch Advisors, Inc. and had sole
dispositive power of 1,899,690 shares, and sole voting
power of 1,899,690 shares. |
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(5) |
|
Based solely on information provided in a Schedule 13G/A
filed with the Securities and Exchange Commission on
December 31, 2005, Dimensional Fund Advisors Inc. had sole
dispositive power of 1,782,770 shares and sole voting power
of 1,782,770. |
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(6) |
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Includes 395,833 shares issuable pursuant to stock options
which are exercisable prior to February 11, 2007. |
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(7) |
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Based on information provided in a Form 3 filed with the
Securities and Exchange Commission on October 1, 2005. Also
includes 200,000 shares issuable pursuant to stock options
which are exercisable prior to February 11, 2007. |
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(8) |
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Includes 171,345 shares issuable pursuant to stock options
which are exercisable prior to February 11, 2007. |
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(9) |
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Includes 156,250 shares issuable pursuant to stock options
which are exercisable prior to February 11, 2007. |
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(10) |
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Includes 144,666 shares issuable pursuant to stock options
which are exercisable prior to February 11, 2007. |
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(11) |
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Includes 78,125 shares issuable pursuant to stock options
which are exercisable prior to February 11, 2007. |
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(12) |
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Based on information provided in a Form 4 filed with the
Securities and Exchange Commission on March 2, 2004. Also
includes 50,625 shares issuable pursuant to stock options
which are exercisable prior to February 11, 2007. |
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(13) |
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Includes 41,250 shares issuable pursuant to stock options
which are exercisable prior to February 11, 2007. |
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(14) |
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Includes 35,625 shares issuable pursuant to stock options
which are exercisable prior to February 11, 2007. |
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(15) |
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Includes 2,500 shares issuable pursuant to stock options
which are exercisable prior to February 11, 2007. |
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(16) |
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Includes 2,500 shares issuable pursuant to stock options
which are exercisable prior to February 11, 2007. |
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(17) |
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Includes 2,500 shares issuable pursuant to stock options
which are exercisable prior to February 11, 2007. |
EXPENSES
AND SOLICITATION
The cost of soliciting proxies on behalf of the Company will be
borne by the Company. The Company will pay banks, brokers and
other entities that exercise fiduciary powers which hold shares
of Common Stock of record in nominee name or otherwise or as a
participant in a registered clearing agency or which hold shares
of Common Stock on behalf of beneficial owners and deposit such
shares for safekeeping with another entity that exercises
fiduciary powers their reasonable expenses for completing the
mailing to security holders of proxy soliciting material and
annual reports supplied by the Company. Further solicitation may
be made by the officers and employees of the Company by mail,
telephone, telegraph or personal interview without additional
compensation.
WHERE YOU
CAN FIND MORE INFORMATION
We file annual, quarterly, and special reports, proxy
statements, and other information with the SEC. You may read and
copy any reports, statements, and other information filed by us
at the SEC public reference rooms at 100 F. Street,
NE, Washington, D.C. 20549. You may also obtain copies of
the documents at prescribed rates by writing to the Public
Reference Section of the SEC at 100 F Street, NE, Washington, DC
20549. Please call the SEC at
1-800-SEC-0330
for further information on the operation of the public reference
facilities. Our filings with the SEC are also available to the
public from commercial document-retrieval services and the
website maintained by the SEC at http://www.sec.gov.
The proxy statement and these other documents may also be
obtained free from Sipex. Requests for documents should be
directed to: Sipex Corporation, 233 South Hillview Drive,
Milpitas, California 95035. Attention: Corporate Secretary,
telephone
(408) 934-7500.
You should rely on the information contained in this proxy
statement to vote on the proposals. We have not authorized
anyone to provide you with information that is different from
what is contained in this proxy statement. You should not assume
that the information contained in the proxy statement is
accurate as of any date other than the
11
date hereof, and the mailing of this proxy statement to our
stockholders shall not create any implication to the contrary.
INCORPORATION
OF DOCUMENTS BY REFERENCE
We file periodic reports, current reports, proxy statements and
information statements with the SEC and we can incorporate
by reference into this proxy statement information already
filed by us with the SEC. This means that we can disclose
important information to you by referring you directly to those
documents. The information incorporated by reference is
considered part of this proxy statement. We incorporate by
reference the documents or portions thereof listed below:
Sipex
Corporations SEC Filings
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(File No. 000-27892)
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Period Covered or Date Filed
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Annual Report on
Form 10-K
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Fiscal Year ended
December 31, 2005, filed August 17, 2006, as amended
by
Form 10-K/A
filed September 21, 2006
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Quarterly Report on
Form 10-Q
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Fiscal Quarter ended April 1,
2006 filed September 21, 2006
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Quarterly Report on
Form 10-Q
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Fiscal Quarter ended July 1,
2006 filed September 21, 2006
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Quarterly Report on
Form 10-Q
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Fiscal Quarter ended
September 30, 2006 filed November 14, 2006
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The reports above will be mailed to our stockholders together
with this proxy statement. If exhibits to the documents
incorporated by reference in this proxy statement are not
themselves specifically incorporated by reference, then exhibits
will not be provided.
All documents filed by us pursuant to Section 13(a), 13(c),
14 or 15(d) of the Securities Exchange Act of 1934 after the
date of this proxy statement and prior to a Special Meeting,
shall be deemed incorporated by reference and be part of this
proxy statement from their respective filing dates. Any
statement contained in this proxy statement or in any document
incorporated or deemed to be incorporated by reference in this
proxy statement will be deemed to be modified or superseded for
the purpose of this proxy statement to the extent that a
subsequent statement contained in this proxy statement or in any
subsequently filed document that also is or is deemed to be
incorporated by reference herein modifies or supersedes the
statement. Any statement so modified or superseded will not be
deemed to be part of this proxy statement.
12
OTHER
MATTERS
The Board of Directors knows of no other matters that will be
presented for consideration by the stockholders at a Special
Meeting. If any other matters are properly brought before the
stockholders at a Special Meeting, it is the intention of the
persons named on the accompanying proxy to vote on those matters
in accordance with any recommendation by the Board of Directors.
By Order of the Board of Directors,
CLYDE R. WALLIN
Secretary
Milpitas, California
Date: December 28, 2006
13
APPENDIX A
CERTIFICATE
OF AMENDMENT
OF THE RESTATED CERTIFICATE OF INCORPORATION
OF SIPEX CORPORATION
Clyde R. Wallin hereby certifies that:
1. He is the duly elected and acting Secretary of Sipex
Corporation, a corporation organized and existing under the laws
of the state of Delaware (the Corporation).
2. The Certificate of Incorporation of the Company
initially was filed with the Secretary of State of the State of
Delaware on April 9, 2003. An Amended and Restated
Certificate of Incorporation of the Corporation was filed with
the Secretary of State of the State of Delaware on
October 28, 2003. An Amendment to the Amended and Restated
Certificate of Incorporation of the Corporation was filed with
the Secretary of the State of Delaware on November 30, 2006.
3. Pursuant to Section 242 of the General Corporation
Law of the State of Delaware, this Certificate of Amendment of
the Amended and Restated Certificate of Incorporation amends the
provisions of the Amended and Restated Certificate of
Incorporation.
4. The terms and provisions of this Certificate of
Amendment of the Amended and Restated Certificate of
Incorporation (i) have been approved by the Board of
Directors of the Corporation in a resolution setting forth and
declaring advisable the amendment contained herein and
(ii) have been duly approved by the required number of
shares of outstanding stock of the Corporation, in each case
pursuant to and in accordance with Section 242 of the
Delaware General Corporation Law.
5. Article IV of the Amended and Restated Certificate
of Incorporation of the Corporation is hereby amended to read in
its entirety as follows:
The corporation is authorized to issue two classes of
stock, to be designated, respectively, Common Stock
and Preferred Stock. The total number of shares
which the corporation shall have authority to issue is
61,000,000 consisting of 60,000,000 shares of Common Stock,
par value $0.01 per share, and 1,000,000 shares of
Preferred Stock, par value $0.01 per share.
Effective 12:01 a.m. on
[ ], 2007 (the
Effective Time), each [one and one-half/two/two and
one-half] shares of Common Stock of the Corporation issued
and outstanding shall be combined into one (1) share of
fully paid and nonassessable Common Stock of the Corporation, as
appropriate, subject to the treatment of fractional shares
interests described below. Following the effectiveness of this
amendment, the Corporation will evidence the reverse stock split
effected by this Article pursuant to procedures adopted by the
Corporation.
No fractional shares of Common Stock of the Corporation shall be
issued. No stockholder of the Corporation shall transfer any
fractional shares of Common Stock of the Corporation. The
Corporation shall not recognize on its stock record books any
purported transfer of any fractional share of Common Stock of
the Corporation.
A holder of common stock at the Effective Time who would
otherwise be entitled to a fraction of a share shall, in lieu
thereof, be entitled to receive a cash payment in an amount
equal to the fraction of a share to which the stockholder would
otherwise be entitled multiplied by the average of the closing
prices of the Common Stock, for the ten (10) trading days
preceding the date that is five (5) trading days before the
Effective Time (as adjusted for the reverse stock split effected
by this Article) (or if such prices are not available, the
average of the last bid and asked prices of the Common Stock on
such days (as adjusted for the reverse stock split effected by
this Article) or other price determined by the Board of
Directors).
The Board of Directors of the corporation (the
Board) is authorized, subject to any limitations
prescribed by law, to provide for the issuance of shares of
Preferred Stock in series, and to establish from time to time
the number of shares to be included in each such series, and to
fix the designation, powers,
A-1
preferences, and rights of the shares of each such series and
any qualifications, limitations or restrictions thereof.
Each outstanding share of Common Stock shall entitle the holder
thereof to one vote on each matter properly submitted to the
stockholders of the corporation for their vote; provided,
however, that, except as otherwise required by law, holders of
Common Stock shall not be entitled to vote on any amendment to
this Certificate of Incorporation (including any certificate of
designation of Preferred Stock relating to any series of
Preferred Stock) that relates solely to the terms of one or more
outstanding series of Preferred Stock if the holders of such
affected series are entitled, either separately or together as a
class with the holders of one or more other such series, to vote
thereon by law or pursuant to this Certificate of Incorporation
(including any certificate of designation of Preferred Stock
relating to any series of Preferred Stock).
IN WITNESS WHEREOF, this Certificate of Amendment of the Amended
and Restated Certificate of Incorporation, which amends certain
provisions of the Amended and Restated Certificate of
Incorporation of the Corporation, having been duly adopted in
accordance with Section 242 of the Delaware General
Corporation Law, has been duly executed by its Secretary, this
[ ] day
of 2007.
Clyde R. Wallin, Secretary
A-2
DETACH HERE
PROXY
SIPEX CORPORATION
PROXY
FOR A SPECIAL MEETING OF STOCKHOLDERS
JANUARY 30th 2007
SOLICITED BY THE BOARD OF DIRECTORS
The undersigned stockholder of Sipex Corporation, a Delaware corporation (the Corporation),
hereby acknowledges receipt of the Notice of a Special Meeting of Stockholders and Proxy Statement,
each dated January 30th 2007 and hereby appoints Ralph Schmitt and Clyde R. Wallin, and
each of them, its true and lawful agents and proxies, with full power to each of substitution, on
behalf and in the name of the undersigned, to represent the undersigned at a Special Meeting of
Stockholders of the Corporation to be held at the Corporations corporate offices, located at 233
South Hillview Drive, Milpitas, California 95035 on Tuesday, January 30th 2007 at 10:00
am, local time, and at any adjournments or postponements thereof, and to vote all shares of Common
Stock which the undersigned would be entitled to vote if then and there personally present, on all
the matters set forth on the reverse side.
[SEE REVERSE SIDE] CONTINUED AND TO BE SIGNED ON REVERSE SIDE [SEE REVERSE SIDE]
DETACH HERE
þ PLEASE MARK VOTES AS IN THIS EXAMPLE.
THIS PROXY WILL BE VOTED AS DIRECTED, OR, IF NO CONTRARY DIRECTION IS INDICATED, WILL BE VOTED FOR
THE ELECTION OF THE DIRECTOR AND AS SAID PROXIES DEEM ADVISABLE ON SUCH OTHER MATTERS AS MAY
PROPERLY COME BEFORE A SPECIAL MEETING OF STOCKHOLDERS.
1. TO APPROVE THE GRANT OF DISCRETIONARY AUTHORITY TO THE BOARD OF
DIRECTORS TO AMEND THE COMPANYS AMENDED AND RESTATED CERTIFICATE OF
INCORPORATION TO EFFECT A REVERSE STOCK SPLIT OF THE COMPANYS ISSUED
COMMON STOCK AT ANY TIME PRIOR TO MARCH 30, 2007, AT ONE OF THE
FOLLOWING RATIOS (THE EXACT RATIO TO BE DETERMINED BY THE BOARD OF
DIRECTORS): ONE SHARE FOR ONE AND ONE-HALF SHARES; ONE SHARE FOR TWO
SHARES; OR ONE SHARE FOR TWO AND ONE-HALF SHARES
o FOR o AGAINST o ABSTAIN
and, in their discretion, upon such other matter or matters which may
properly come before the meeting or any adjournments or postponements
thereof.
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT o
(This proxy should be dated and must be signed by the stockholder(s)
exactly as his or her name appears hereon, and returned promptly in
the enclosed envelope. Persons signing in a fiduciary capacity
should so indicate. If shares are held by joint tenants of a
community property, both should sign.)
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Signature:
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Date: |
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Signature:
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Date: |
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