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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 24, 2001
REGISTRATION NO.333-___
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
----------------------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------------------------------
SIPEX CORPORATION
(Exact name of Registrant as specified in its charter)
-----------------------------
MASSACHUSETTS 04-6135748
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
22 LINNELL CIRCLE
BILLERICA, MA 01821
(978) 667-8700
(Address, including zip code, and telephone number,
including area code, of Registrant's principal executive offices)
----------------------------------------
JAMES E. DONEGAN
CHIEF EXECUTIVE OFFICER
SIPEX CORPORATION
22 LINNELL CIRCLE
BILLERICA, MA 01821
(978) 667-8700
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
----------------------------------------
COPIES OF ALL COMMUNICATIONS, INCLUDING ALL COMMUNICATIONS SENT TO THE
AGENT FOR SERVICE, SHOULD BE SENT TO:
KENNETH J. GORDON, ESQ.
TESTA, HURWITZ & THIBEAULT, LLP
HIGH STREET TOWER
125 HIGH STREET
BOSTON, MASSACHUSETTS 02110
(617) 248-7000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this Registration Statement becomes effective.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following. [ ]
CALCULATION OF REGISTRATION FEE
AMOUNT TO BE PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF SHARES TO BE REGISTERED REGISTERED OFFERING PRICE PER AGGREGATE OFFERING REGISTRATION
SHARE(1) PRICE(1) FEE(2)
Common Stock, $.01 par value per share 2,190,000 $12.99 $28,448,100 $7,113
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457 under the Securities Act of 1933.
(2) Pursuant to Rule 457(c) under the Securities Act of 1933, the registration
fee has been calculated based upon the average of the high and low prices
per share of the common stock of SIPEX Corporation on the Nasdaq National
Market on May 22, 2001.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(a), MAY
DETERMINE.
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THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN
OFFER TO SELL SECURITIES, AND IT IS NOT SOLICITING OFFERS TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED MAY 24, 2001.
PROSPECTUS
SIPEX CORPORATION
2,190,000 SHARES
COMMON STOCK
This prospectus relates solely to the resale of up to 2,190,000 shares
of our common stock that we sold to the selling stockholders identified in this
prospectus in a private placement completed on May 16, 2001. The selling
stockholders or their pledgees, donees, transferees or other
successors-in-interest may offer and sell the shares from time to time through
public or private transactions at prevailing market prices or at privately
negotiated prices. We are not selling any shares of our common stock under this
prospectus and we will not receive any proceeds from the sale of these shares by
the selling stockholders or their pledgees, donees, transferees or other
successors-in-interest.
Our common stock is traded on the Nasdaq National Market under the
symbol "SIPX." The last reported sale price of our common stock on May 22,
2001 was $13.44 per share.
INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK.
SEE "RISK FACTORS" BEGINNING ON PAGE 3.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES, OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this prospectus is May 24, 2001.
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YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS. WE HAVE
NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION DIFFERENT FROM THAT
CONTAINED IN THIS PROSPECTUS. WE ARE NOT MAKING AN OFFER OF THESE SECURITIES IN
ANY STATE WHERE THE OFFER IS NOT PERMITTED. THE INFORMATION CONTAINED IN THIS
PROSPECTUS IS ACCURATE ONLY AS OF THE DATE OF THIS PROSPECTUS, REGARDLESS OF THE
TIME OF DELIVERY OF THIS PROSPECTUS OR OF ANY SALE OF THE COMMON STOCK.
TABLE OF CONTENTS
PAGE
Summary............................................... 1
The Company........................................... 1
Contact Information................................... 1
Risk Factors.......................................... 2
Use of Proceeds....................................... 8
Selling Stockholders.................................. 8
Plan of Distribution.................................. 10
Legal Matters......................................... 11
Experts............................................... 11
Where You Can Find More Information................... 12
Incorporation of Certain Documents by
Reference.......................................... 12
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SUMMARY
The following summary is qualified in its entirety by the more detailed
information appearing elsewhere or incorporated by reference in this prospectus.
This prospectus may contain certain "forward-looking" information, as that term
is defined by (i) the Private Securities Litigation Reform Act of 1995 (the
"Act") and (ii) releases made by the Securities and Exchange Commission. Such
information involves risks and uncertainties. Our actual results may differ
materially from the results discussed in the forward-looking statements. Factors
that might cause such a difference include, but are not limited to, those
discussed in "Risk Factors."
THE COMPANY
We design, manufacture and market innovative, high performance, high
value-added analog integrated circuits. We sell our products across the analog
semiconductor market and have targeted high-growth sectors that we believe are
especially compatible with our design and process capabilities. Applications for
our products include: telecommunications, cellular telephones, networking
products, computers, computer peripherals, notebook and desktop computers,
industrial instrumentation, aerospace and military. Our products have been
incorporated into a broad range of electronic systems and products by more than
4,500 customers worldwide.
CONTACT INFORMATION
We incorporated in Massachusetts in May 1965 under the name Hybrid
Systems Inc. In 1987, we changed our name to SIPEX Corporation. Our executive
offices are located at 22 Linnell Circle, Billerica, Massachusetts 01821, and
our telephone number is (978) 667-8700.
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RISK FACTORS
You should carefully consider the following risks before making an
investment decision. Our business, results of operations and financial condition
could be adversely affected by any of the following risks. Additional risks and
uncertainties, including those that are not yet identified or that we currently
think are immaterial, may also adversely affect our business, results of
operations and financial condition. The market price of our common stock could
decline due to any of these risks, and you could lose all or part of your
investment.
OUR QUARTERLY AND ANNUAL OPERATING RESULTS ARE VOLATILE AND DIFFICULT TO PREDICT
AND MAY CAUSE OUR STOCK PRICE TO FLUCTUATE.
The semiconductor industry has been highly cyclical and is subject to
significant economic downturns. We may experience substantial period-to-period
fluctuations in future operating results due to general semiconductor industry
conditions and overall economic conditions. Our quarterly and annual operating
results have varied significantly in the past and we expect that they will
continue to fluctuate in the future. You should not rely on period-to-period
comparisons of our results of operations as indications of our future
performance. In some future periods, our results of operations are likely to be
below the expectation of public market analysts and investors. In this case, the
price of our common stock would likely decline. Our revenues and results of
operations are difficult to forecast and depend on a variety of factors. These
factors include the following:
- availability of foundry capacity and raw materials;
- fluctuations in our manufacturing yields and efficiencies;
- competitive pressures on selling prices;
- the timing and cancellation of customer orders;
- changes in product mix;
- our ability to introduce new products and technologies on
a timely basis;
- introduction of products and technologies by our
competitors;
- market acceptance of our products and our customers'
products; and
- the timing of our investments in research and development,
including tooling expenses associated with product
development, process improvements and production.
As a result of the foregoing or other factors, we may experience material
fluctuations in future operating results on a quarterly or annual basis, which
could substantially harm our business, financial condition and operating
results.
IT WOULD BE DIFFICULT FOR US TO ADJUST OUR SPENDING IF WE EXPERIENCE ANY REVENUE
SHORTFALLS.
Our future revenues will be difficult to predict and at times in the
past we have failed to achieve our revenue expectations. Our expense levels are
based, in part, on our expectation of future revenues, and expense levels are,
to a large extent, fixed in the short term. We may be unable to adjust spending
in a timely manner to compensate for any unexpected revenue shortfall. If
revenue levels are below expectations for any reason, our operating results are
likely to be harmed. Due to the absence of substantial noncancellable backlog,
we typically plan our production and inventory levels based on internal
forecasts of customer demand, which is highly unpredictable and often fluctuates
substantially.
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Because we are continuing to increase our operating expenses for personnel and
new product development and for inventory in anticipation of increasing sales
levels, our operating results would be harmed if increased sales are not
achieved. In addition, we are limited in our ability to reduce costs quickly in
response to any revenue shortfalls.
WE HAVE SIGNIFICANT CAPITAL REQUIREMENTS TO MAINTAIN AND GROW OUR BUSINESS.
In order to remain competitive, we must continue to make significant
investments in our facilities and capital equipment. We have funded a portion of
our capital investments through long term debt under our $20 million line of
credit with a commercial bank. In addition to this line of credit, we may seek
additional equity or debt financing from time to time and cannot be certain that
additional financing will be available on favorable terms, if at all. Moreover,
any future equity or convertible debt financing will decrease the percentage of
equity ownership of existing stockholders and may result in dilution, depending
on the price at which the equity is sold or the debt is converted.
WE MAY EXPERIENCE DIFFICULTIES IN DEVELOPING AND INTRODUCING NEW OR ENHANCED
PRODUCTS NECESSITATED BY TECHNOLOGICAL CHANGES.
Our future success will depend, in part, upon our ability to anticipate
changes in market demand and evolving technologies, to enhance our current
products and to develop and introduce new products that keep pace with
technological advancements and address the increasingly sophisticated needs of
our customers. Our products may be rendered obsolete if we fail to anticipate or
react to change, and, as a result, our revenues and cash flow may be negatively
impacted. Our success depends on our ability to develop new semiconductor
devices for existing and new markets, to introduce these products in a timely
manner and to have these products selected for design into new products of our
customers. The development of these new devices is highly complex and from time
to time we have experienced delays in completing the development of new
products. Successful product development and introduction depends on a number of
factors, including:
- accurate new product definition;
- timely completion and introduction of new product designs;
- availability of foundry capacity;
- achievement of manufacturing yields; and
- market acceptance of our products and our customer's
products.
Our success also depends upon our ability to accurately specify and
certify the conformance of our products to applicable standards and to develop
our products in accordance with customer requirements. We cannot assure you that
we will be able to adjust to changing market conditions as quickly and
cost-effectively as necessary to compete successfully. We cannot assure you that
we will be able to introduce new products in a timely and cost-effective manner
or in sufficient quantities to meet customer demand or that these products will
achieve market acceptance. Furthermore, we cannot assure you that our customers'
products will achieve market acceptance.
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OUR MANUFACTURING PROCEDURES ARE VERY COMPLEX, WHICH MAY RESULT IN MANUFACTURING
DIFFICULTIES.
Our manufacturing processes are highly complex and are continuously
being modified in an effort to improve yields and product performance. Process
changes can result in interruptions in production or significantly reduced
yields that could result in product introduction or delivery delays. In
addition, yields can be adversely affected by minute impurities in the
environment or other problems that occur in the complex manufacturing process.
Many of these problems are difficult to diagnose and time-consuming or expensive
to remedy. From time to time, we have experienced yield variances. In
particular, new process technologies or new products can be subject to
especially wide variations in manufacturing yields and efficiency. We cannot
assure you that our foundry or those of our suppliers will not experience yield
variances or other manufacturing problems that result in product introduction or
delivery delays.
BRINGING OUR WAFER FABRICATION FACILITY TO FULL OPERATING CAPACITY COULD TAKE
LONGER AND COST MORE THAN WE ANTICIPATED.
Our wafer fabrication facility in Milpitas, California began production
in the second half of 1999. The facility is a sophisticated, highly complex,
state-of-the-art factory. Actual production rates and manufacturing yields
depend upon the reliable operation and effective integration of a variety of
hardware and software components. We have experienced and may continue to
experience unexpected delays and problems in qualifying and ramping up
production in this facility. Our inability to achieve and maintain acceptable
production capacity and yield levels will adversely impact our gross margins,
profitability and financial condition. In addition, the amount of capital
expenditures required to bring the facility to full operating capacity could be
greater than we currently anticipate. Higher costs to bring the facility to full
operating capacity will reduce our margins and could harm our business.
WE RELY ON OUTSIDE FOUNDRIES TO SUPPLY WAFERS AND THOSE FOUNDRIES MAY NOT
PRODUCE AT ACCEPTABLE LEVELS.
We rely on outside foundries to supply fully processed semiconductor
wafers. This reliance on outside foundries presents the following potential
risks:
- lack of adequate wafer supply;
- limited control over delivery schedules;
- unavailability of or delays in obtaining access to key
process technologies; and
- limited control over quality assurance, manufacturing
yields and production costs.
Additionally, the manufacture of integrated circuits is a highly complex and
technologically demanding process. Our third-party foundries have, from time to
time, experienced lower than anticipated manufacturing yields, particularly in
connection with the introduction of new products and the installation and
start-up of new process technologies. We cannot assure you that our outside
foundries will not experience lower than expected manufacturing yields in the
future.
Additionally, we purchase fully processed semiconductor wafers from outside
foundries. We do not have a guaranteed level of production capacity at any of
our foundries. The ability of each foundry to provide wafers to us is limited by
the foundry's available capacity, and the foundry's allocation of its available
capacity among multiple customers. We cannot assure you that our third-party
foundries will allocate sufficient capacity to satisfy our requirements. We have
experienced decreased allocations of wafer supplies from our suppliers in the
past, which reduced our capacity to ship products, and, thus, recognize
revenues. Additionally, any sudden reduction or elimination of any primary
source or sources of fully
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processed wafers could result in a material delay in the shipment of our
products. If any other delays or shortages occur in the future, our revenues and
business will be harmed.
WE MUST COMPLY WITH SIGNIFICANT ENVIRONMENTAL REGULATIONS, WHICH IS DIFFICULT
AND EXPENSIVE.
We are subject to a variety of federal, state and local governmental
regulations related to the use, storage, discharge and disposal of toxic,
volatile or otherwise hazardous chemicals used in our manufacturing processes.
Although we believe that our activities conform to presently applicable
environmental regulations, the failure to comply with present or future
regulations could result in fines being imposed on us, suspension of production
or a cessation of operations. Any failure by us to control the use of, or
adequately restrict the discharge of, hazardous substances, or otherwise comply
with environmental regulations, could subject us to significant future
liabilities. In addition, we cannot assure you that we have not in the past
violated laws or regulations, which violations could result in remediation or
other significant liabilities, or that past use or disposal of environmentally
sensitive materials in conformity with then existing environmental laws and
regulations will not result in remediation or other significant liabilities
under current or future environmental laws or regulations.
WE MAY NOT SUCCESSFULLY EXPAND OUR SALES AND DISTRIBUTION CHANNELS.
An integral part of our strategy is to expand our sales and
distribution channels. We are increasing resources dedicated to developing and
expanding these channels but we may not be successful doing so. If we are
successful in increasing our sales through indirect sales channels, we expect
that those sales will be at lower per unit prices than sales through direct
channels, and revenues we receive for each sale will be less than if we had sold
the same product to the customer directly. Selling through indirect channels may
also limit our contact with our customers. As a result, our ability to
accurately forecast sales, evaluate customer satisfaction and recognize emerging
customer requirements may be hindered.
Even if we successfully expand our distribution channels, any new
distributors may not have the technical expertise required to market and support
our products successfully. If parties do not provide adequate levels of services
and technical support, our customers could become dissatisfied, we could be
required to devote additional resources for customer support, and our brand name
and reputation could be harmed.
Our strategy of marketing products directly to our customers and
indirectly through distributors may result in distribution channel conflicts.
Our direct sales efforts may compete with those of our indirect channels and, to
the extent different distributors target the same customers, distributors may
also come into conflict with each other. Although we have attempted to manage
our distribution channels to avoid potential conflicts, channel conflicts may
harm our relationships with existing sales representatives or distributors or
impair our ability to attract sales representatives.
OUR FUTURE SUCCESS DEPENDS ON RETAINING OUR KEY PERSONNEL AND ATTRACTING AND
RETAINING ADDITIONAL HIGHLY QUALIFIED EMPLOYEES.
Our success depends upon the continued service of our executive
officers and other key management and technical personnel, and on our ability to
continue to attract, retain and motivate qualified personnel, such as
experienced analog circuit designers. The competition for these employees is
intense. Most of our employees are employees at-will and we have no fixed-term
employment agreements with most employees, which means that they can terminate
their employment at any time. We cannot assure you that we will be able to
retain our design engineers, executive officers and other key personnel. The
loss of the services of one or more of our design engineers, executive officers
or other key personnel
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or our inability to recruit replacements for these personnel or to otherwise
attract, retain and motivate qualified personnel could seriously impede our
success.
WE MAY FACE SIGNIFICANT RISKS IN EXPANDING OUR INTERNATIONAL OPERATIONS.
We derive a significant portion of our net sales from international
sales, including Asia, which involve a number of additional risks, including the
following:
- impact of possible recessionary environments in economies
outside the United States;
- longer receivables collection periods and greater
difficulty in accounts receivable collection;
- reduced protection for intellectual property rights in
some countries;
- foreign currency exchange rate fluctuations;
- difficulties in staffing and managing foreign operations;
- the burdens of complying with a variety of foreign laws;
and
- political and economic instability.
If our international operations expand, an increasing portion of our revenues
will be denominated in foreign currencies, subjecting us to fluctuations in
foreign currency exchange rates. We do not currently engage in foreign currency
hedging transactions. However, as we continue to expand our international
operations, exposures to gains and losses on foreign currency transactions may
increase. We may choose to limit our exposure by the purchase of forward foreign
exchange contracts or similar hedging strategies. Any currency exchange strategy
that we adopt may not be successful in avoiding exchange-related losses. In
addition, the above-listed factors may cause a decline in our future
international revenues and, consequently, may harm our business.
WE HAVE ONLY LIMITED PROTECTION FOR OUR PROPRIETARY TECHNOLOGY.
Our success depends in part on our ability to obtain patents and
licenses and to preserve other intellectual property rights covering our
products and development and testing tools. We have obtained some patents and
intend to continue to seek patents on our inventions when appropriate. The
process of seeking patent protection can be time consuming and expensive and we
cannot assure you that patents will issue from currently pending or future
applications or that our existing patents or any new patents that may be issued
will be sufficient in scope or strength to provide meaningful protection or any
commercial advantage to us.
We cannot assure you that foreign intellectual property laws will
protect our intellectual property rights. Furthermore, we cannot assure you that
others will not independently develop similar products, duplicate our products
or design around any of our patents. We may be subject to, or may initiate,
interference proceedings in the patent office, which can demand significant
financial and management resources.
WE MAY BECOME SUBJECT TO INFRINGEMENT CLAIMS.
Although we do not believe that our products infringe the proprietary
rights of any third parties, we have in the past been subject to infringement
claims and third parties might assert infringement claims against us or our
customers in the future. Furthermore, we may initiate claims or litigation
against third parties for infringement of our proprietary rights or to establish
the validity of our proprietary rights.
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Litigation, either as a plaintiff or a defendant, would cause us to incur
substantial costs and divert management resources from productive tasks. Any
litigation, regardless of the outcome, could harm our business.
If it appears necessary or desirable, we may seek licenses to
intellectual property that we are allegedly infringing. We may not be able to
obtain licenses on acceptable terms. The failure to obtain necessary licenses or
other rights could harm our business.
IF WE ARE UNABLE TO COMPETE EFFECTIVELY WITH EXISTING OR NEW COMPETITORS, WE
WILL EXPERIENCE FEWER CUSTOMER ORDERS, REDUCED REVENUES, REDUCED GROSS MARGINS
AND LOST MARKET SHARE.
We compete in markets that are intensely competitive, and which exhibit
both rapid technological changes and continued price erosion. Our competitors
include many large domestic and foreign companies that have substantially
greater financial, technical and management resources than us. Loss of
competitive position could result in price reductions, fewer customer orders,
reduced revenues, reduced gross margins and loss of market share, any of which
would affect our operating results and financial condition. To remain
competitive, we continue to evaluate our manufacturing operations, looking for
additional cost savings and technological improvements. If we are not able to
successfully implement new process technologies and to achieve volume production
of new products at acceptable yields, our operating results and financial
condition may be affected. Our future competitive performance depends on a
number of factors, including our ability to:
- accurately identify emerging technological trends and
demand for product features and performance
characteristics;
- develop and maintain competitive products;
- enhance our products by adding innovative features that
differentiate our products from those of our competitors;
- bring products to market on a timely basis at competitive
prices;
- respond effectively to new technological changes or new
product announcements by others;
- increase device performance and improve manufacturing
yields;
- adapt products and processes to technological changes; and
- adopt and/or set emerging industry standards.
We cannot assure you that our design, development and introduction schedules for
new products or enhancements to our existing and future products will be met. In
addition, we cannot assure you that these products or enhancements will achieve
market acceptance, or that we will be able to sell these products at prices that
are favorable to us.
OUR STOCK PRICE HAS BEEN VOLATILE AND COULD CONTINUE TO REMAIN VOLATILE.
Our stock price has been extremely volatile in the past. We expect that
our stock price may be significantly affected by a number of factors, including
the following:
- actual or anticipated fluctuations in our operating
results;
- announcements of technological innovations or new products
by us or our competitors;
- developments with respect to patents, copyrights or
proprietary rights;
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- conditions and trends in the semiconductor or other
industries; and
- general market conditions.
In addition, the public stock markets have experienced extreme price and trading
volume volatility in recent months. This volatility has significantly affected
the market prices of securities of many technology companies for reasons
frequently unrelated to the operating performance of the specific companies.
These broad market fluctuations may adversely affect the market price of our
common stock.
WE COULD FACE SECURITIES LITIGATION IF OUR STOCK PRICE REMAINS HIGHLY VOLATILE.
In the past, securities class action litigation has often followed
periods of volatility in the market price of a company's securities. We may face
securities class action litigation in the future. Any litigation could result in
substantial costs and a diversion of management's attention and resources, which
could harm our business.
USE OF PROCEEDS
We will not receive any proceeds from the resale of our common stock by
the selling stockholders. The principal purpose of this offering is to effect an
orderly disposition of the selling stockholders' shares.
SELLING STOCKHOLDERS
We are registering the 2,190,000 shares of our common stock covered by
this prospectus pursuant to agreements between us and the selling stockholders
named in the table below. We issued and sold all of the shares to the selling
stockholders in a private placement completed on May 16, 2001. We are
registering the shares to permit the selling stockholders (and their pledgees,
donees, transferees and other successors-in-interest that receive their shares
from a selling stockholder as a gift, partnership distribution or other non-sale
related transfer after the date of this prospectus) to resell the shares when
and if they deem appropriate. We have agreed with the selling stockholders to
use our best efforts to keep the registration statement (of which this
prospectus is a part) effective until the earliest of (i) the date on which all
of the shares have been sold, (ii) the first date on which all of the then
remaining unsold shares are able to be sold within a 90-day period pursuant to
Rule 144 of the Securities Act of 1933, or (iii) May 16, 2003.
The following table sets forth the name of each selling stockholder and
the number of shares of our common stock that, to our knowledge, each selling
stockholder beneficially owned as of May 22, 2001. We have calculated the
number of shares beneficially owned by the selling stockholders based on
information furnished to us by them or on their behalf, and in accordance with
the rules of the Securities and Exchange Commission. To our knowledge, each of
the selling stockholders at such time had sole voting and investment power with
respect to the shares of common stock that it held as of May 22, 2001, unless
otherwise stated in the footnotes to the table. The inclusion of any shares in
this table does not constitute an admission of beneficial ownership for the
person named below. We have determined each selling stockholder's percentage
ownership based on 24,703,751 shares of our common stock outstanding on May 22,
2001, which includes the 2,190,000 shares issued and sold to the selling
stockholders in the private placement. Except as stated in the footnotes to the
table, none of the selling stockholders has held any position or office or has
had any material relationship with us or any of our predecessors or affiliates
within the past three years, other than as a result of the ownership of the
shares or our other securities.
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SHARES OF COMMON STOCK SHARES OF COMMON STOCK TO BE
BENEFICIALLY BENEFICIALLY
OWNED PRIOR TO OFFERING OWNED AFTER OFFERING(1)
----------------------- -----------------------
NUMBER OF SHARES
OF COMMON STOCK
NAME OF SELLING STOCKHOLDER NUMBER PERCENT BEING OFFERED NUMBER PERCENT
--------------------------- ------ ------- ------------- ------ -------
State of Wisconsin 1,830,000 7.41% 750,000 1,080,000 4.37%
Investment Board
Oppenheimer Discovery Fund(2) 499,900 2.02% 400,000 99,900 *
Putnam Capital Appreciation 356,500 1.44% 356,500 0 *
Fund(3)
Putnam Capital Opportunities 292,300 1.18% 292,300 0 *
Fund(3)
Evergreen Growth Fund(4) 146,200 * 146,200 0 *
Schroder Ultra Fund 135,000 * 40,000 95,000 *
Formula Growth Fund 100,000 * 100,000 0 *
Formula Unit Trust 100,000 * 100,000 0 *
Evergreen VA Growth Fund(4) 3,800 * 3,800 0 *
Putnam VT Capital Appreciation 1,200 * 1,200 0 *
Fund(3)
* Less than one percent.
(1) We do not know when or in what amounts a selling stockholder may offer
shares for sale. The selling stockholders may sell none, some or all of the
shares offered by this prospectus. We have no agreements, arrangements or
understandings with any of the selling stockholders with respect to the
sale of any of the shares. We cannot estimate, therefore, the number of the
shares that will be held by the selling stockholders after completion of
the offering. For purposes of this table, however, we have assumed none of
the shares covered by this prospectus will be held by the selling
stockholders after the completion of the offering.
(2) An additional 21,600 shares of Common Stock are owned by Oppenheimer
OTC Small Cap Value Equity Fund, for which Oppenheimer Trust Company is
the sponsor. Oppenheimer Trust Company is an affiliate of Oppenheimer Funds
Inc. Oppenheimer Funds Inc. is an advisor to Oppenheimer Discovery Fund.
(3) Each of these funds has shared investment power with their investment
advisor, Putnam Investment Management, LLC. An additional 1,010,085
shares of Common Stock are owned by various other Putnam funds and
accounts.
(4) An additional 671,300 shares of Common Stock are held by various
institutional accounts managed by Evergreen Investment Management Company,
LLC. Evergreen Investment Management Company, LLC is the investment manager
for Evergreen Growth Fund and Evergreen VA Growth Fund.
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PLAN OF DISTRIBUTION
The shares of our common stock covered by this prospectus may be
offered and sold from time to time by the selling stockholders. The term
"selling stockholders" includes pledgees, donees, transferees, and other
successors-in-interest selling shares received after the date of his prospectus
from a selling stockholder as a gift, pledge, partnership distribution or other
non-sale related transfer. The selling stockholders will act independently of us
in making decisions with respect to the timing, manner and size of each sale.
Such sales may be made on one or more exchanges or in the over-the-counter
market or otherwise, at prices and under terms then prevailing or at prices
related to the then current market price or in negotiated transactions. The
selling stockholders may sell their shares by one or more of, or a combination
of, the following methods:
- purchases by a broker-dealer as principal and resale by such
broker-dealer for its own account pursuant to this prospectus;
- ordinary brokerage transactions and transactions in which the
broker solicits purchasers;
- block trades in which the broker-dealer so engaged will
attempt to sell the shares as agent but may position and
resell a portion of the block as principal to facilitate the
transaction;
- in privately negotiated transactions;
- in options transactions; and
- through other means.
In addition, any shares that qualify for sale pursuant to Rule 144 of
the Securities Act of 1933 may be sold under Rule 144 rather than pursuant to
this prospectus. To our knowledge, no selling stockholder has entered into any
agreement with a prospective underwriter and there is no assurance that any such
agreement will be entered into.
To the extent required, this prospectus may be amended or supplemented
from time to time to describe a specific plan of distribution. In connection
with distributions of the shares or otherwise, the selling stockholders may
enter into hedging transactions with broker-dealers or other financial
institutions. In connection with such transactions, broker-dealers or other
financial institutions may engage in short sales of the common stock in the
course of hedging the positions they assume with selling stockholders. The
selling stockholders may also sell the common stock short and redeliver the
shares to close out such short positions. The selling stockholders may also
enter into option or other transactions with broker-dealers or other financial
institutions which require the delivery to such broker-dealer or other financial
institution of shares offered by this prospectus, which shares such
broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction). The selling
stockholders may also pledge shares to a broker-dealer or other financial
institution, and, upon a default, such broker-dealer or other financial
institution, may effect sales of the pledged shares pursuant to this prospectus
(as supplemented or amended to reflect such transaction).
In effecting sales, broker-dealers or agents engaged by the selling
stockholders may arrange for other broker-dealers to participate. Broker-dealers
or agents may receive commissions, discounts or concessions from the selling
stockholders in amounts to be negotiated immediately prior to the sale.
In offering the shares covered by this prospectus, the selling
stockholders and any broker-dealers who execute sales for the selling
stockholders may be deemed to be "underwriters" within the meaning of the
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Securities Act of 1933 in connection with such sales. Any profits realized by
the selling stockholders and compensation of any broker-dealer may be deemed to
be underwriting discounts and commissions.
In order to comply with the securities laws of certain jurisdictions,
the shares offered by this prospectus may need to be offered or sold in such
jurisdictions only through registered or licensed brokers or dealers.
Under applicable rules and regulations under the Securities Exchange
Act of 1934, any person engaged in a distribution of the shares of common stock
covered by this prospectus may be limited in their ability to engage in market
activities with respect to such shares. The selling stockholders, for example,
will be subject to applicable provisions of the Securities Exchange Act of 1934
and the rules and regulations under it, including, without limitation Regulation
M, which provisions may restrict certain activities of the selling stockholders
and limit the timing of purchases and sales of any shares of common stock by the
selling stockholders. Furthermore, under Regulation M, persons engaged in a
distribution of securities are prohibited from simultaneously engaging in market
making and certain other activities with respect to such securities for a
specified period of time prior to the commencement of such distributions,
subject to specified exceptions or exemptions. The foregoing may affect the
marketability of the shares offered by this prospectus.
We have agreed to pay the fees and expenses incurred in effecting the
registration of the shares covered by this prospectus, including, without
limitation, all registration and filing fees, Nasdaq National Market listing
fees and fees and expenses of our counsel and our accountants. The selling
stockholders will pay any underwriting discounts and commissions and expenses
incurred by the selling stockholders for brokerage, accounting, tax or legal
services or any other expenses incurred by the selling stockholders in disposing
of the shares. We will not receive any of the proceeds from the sale of our
common stock by the selling stockholders.
We have agreed to indemnify the selling stockholders against certain
liabilities, including certain liabilities under the Securities Act of 1933.
We have agreed to keep the registration statement of which this
prospectus forms a part until the earliest of (i) the date on which all of the
shares have been sold, (ii) the date on which all of the then remaining unsold
shares are able to be sold within a 90-day period pursuant to Rule 144 of the
Securities Act of 1933, or (iii) May 16, 2003. We may suspend the selling
stockholders' rights to resell shares under this prospectus.
EquiServe, 150 Royall Street, Canton, MA 02021, is the transfer agent
for the shares of our common stock.
LEGAL MATTERS
The validity of the shares of common stock offered hereby will be
passed upon for us by Testa, Hurwitz & Thibeault, LLP, Boston, Massachusetts.
EXPERTS
The consolidated financial statements of SIPEX Corporation as of
December 31, 2000 and 1999, and for each of the years in the three-year period
ended December 31, 2000, have been incorporated by reference herein and in the
registration statement in reliance upon the reports of KPMG LLP and
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Sallmann, Yang & Alameda, independent certified public accountants, incorporated
by reference herein, and upon the authority of said firms as experts in
accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission You may read and
copy any document we file at the public reference facilities, maintained by the
Securities and Exchange Commission:
Judiciary Plaza Citicorp Center Seven World Trade Center
Room 1024 5000 West Madison Street 13th Floor
450 Fifth Street, N.W. Suite 1400 New York, New York 10048
Washington, D.C. 20549 Chicago, Illinois 60661
Copies of these materials can also be obtained by mail at prescribed
rates from the Public Reference Section of the Securities and Exchange
Commission, 450 Fifth Street, N.W., Washington, D.C. 20549 or by calling the
Securities and Exchange Commission at 1-800-SEC-0330. Our Securities and
Exchange Commission filings are also available to the public from the Securities
and Exchange Commission's website at "http://www.sec.gov."
INFORMATION INCORPORATED BY REFERENCE
The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with them, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is considered to be part of this
prospectus, and information that we file later with the Securities and Exchange
Commission will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filing we
will make with the Securities and Exchange Commission under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 (File No. 000-27892):
1. Our Annual Report on Form 10-K for the year ended December 31,
2000;
2. Our Quarterly Report on From 10-Q for the quarter ended March
31, 2001;
3. The section entitled "Description of Registrant's Securities
to be Registered" contained in the Registrant's registration
statement on Form 8-A filed with the Commission pursuant to
Section 12(g) of the Exchange Act and incorporating by
reference the information contained in the Registrant's
Registration Statement on Form S-1 (SEC File No. 333-1328);
and
4. All of our filings pursuant to the Securities Exchange Act of
1934 after the date of filing the initial registration
statement and prior to the effectiveness of the registration
statement.
We will provide a copy of any and all of the information that is
incorporated by reference in this prospectus, not including exhibits to the
information unless those exhibits are specifically incorporated by reference
into this prospectus, to any person, without charge, upon written or oral
request.
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Requests for copies of this information should be directed to Investor
Relations, SIPEX Corporation, 22 Linnell Circle, Billerica, Massachusetts 01821;
telephone number (978) 667-8700.
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2,190,000 SHARES
SIPEX CORPORATION
COMMON STOCK
PROSPECTUS
May 24, 2001
18
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth an estimate of the expenses expected to
be incurred in connection with the issuance and distribution of the securities
being registered, other than underwriting compensation:
Registration fee -- Securities and Exchange Commission.......................... $ 7,113
Accounting fees and expenses.................................................... $ 5,000
Legal fees and expenses......................................................... $20,000
Miscellaneous................................................................... $ 5,000
TOTAL...................................................................... $37,113
Sipex will bear all expenses shown above. All amounts, other than the
Securities and Exchange Commission registration fee, are estimates solely for
the purpose of this offering.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Sipex's Articles of Organization eliminates the personal liability of
its directors as permitted by the Massachusetts Business Corporation Law. In
addition, Sipex's Articles of Organization provides indemnity for Sipex's
current or former officers and directors against all liabilities and costs of
defending an action or suit in which they were involved by reason of their
positions with Sipex. However, Sipex cannot indemnify any person if a court
finds that the person did not act in good faith.
The Company has entered into separate indemnification agreements with
each of its directors and executive officers, whereby the Company agreed, among
other things, to indemnify them to the fullest extent permitted by the Business
Corporation Law of the Commonwealth of Massachusetts, subject to specified
limitations, against certain liabilities actually and reasonably incurred by
them in any proceeding in which they are a party that may arise by reason of
their status as directors, officers, employees or agents or may arise by reason
of their serving as such at the request of the Company for another entity and to
advance their expenses incurred as a result of any proceeding against them as to
which they could be indemnified. The Company intends to enter into similar
separate indemnification agreements with any directors or officers who may join
the Company in the future. There is no pending litigation or proceeding
involving a director, officer, employee or other agent of the Company as to
which indemnification is being sought nor is the Company aware of any pending or
threatened litigation that may result in claims for indemnification.
ITEM 16. EXHIBITS.
The following exhibits, required by Item 601 of Regulation S-K, are
filed as a part of this registration statement. Exhibit numbers, where
applicable, in the left column correspond to those of Item 601 of Regulation
S-K.
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EXHIBIT NO. ITEM AND REFERENCE
3.1 -- Articles of Organization (filed as Exhibit 3.2 to Registration
Statement on Form S-1, File No. 333-1328, and incorporated
herein by reference).
3.2 -- Restated By-Laws (filed as Exhibit 3.3 to Registrant's
Registration Statement on Form S-1, File No. 333-1328, and
incorporated herein by reference).
4.1 -- Form of Stock Purchase Agreement by and between the Registrant
and each of the Selling Stockholders.
5.1 -- Legal opinion of Testa, Hurwitz & Thibeault, LLP.
23.1 -- Consent of KPMG LLP
23.2 -- Consent of Sallmann, Yang & Alameda
23.3 -- Consent of Testa, Hurwitz & Thibeault, LLP (included in
Exhibit 5.1)
24.1 -- Power of attorney (contained on signature page)
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represents a fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or decrease in volume of
securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high and of
the estimated maximum offering range may be reflected in the form of prospectus
filed with the Securities and Exchange Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than 20 percent
change in the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
provided, however, that paragraphs (1)(i) and 1(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
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(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 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.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to provisions described in Item 15 above, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act of 1933 and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement on Form S-3 to be signed on its behalf by the undersigned, thereunto
duly authorized in the City of Billerica, Commonwealth of Massachusetts on May
24, 2001.
SIPEX Corporation
By: /s/ James E. Donegan
----------------------------------------
James E. Donegan
Chief Executive Officer and
Chairman of the Board of Directors
POWER OF ATTORNEY
Each person whose signature appears below on this registration
statement hereby constitutes and appoints James E. Donegan and Frank R. DiPietro
and each of them, with full power to act without the other, his true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities (until
revoked in writing) to sign any and all amendments (including post-effective
amendments and amendments thereto) to this registration statement on Form S-3 of
SIPEX Corporation, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys-in-fact and agents, and each of them, full power
and authority to do and perform each and every act and thing requisite and
necessary fully to all intents and purposes as he might or could do in person
thereby ratifying and confirming all that said attorneys-in-fact and agents or
any of them, or their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
Pursuant to the requirements of the Securities Act, this registration
statement on Form S-3 has been signed below by the following persons on behalf
of the Registrant and in the capacities and on the dates indicated.
NAME CAPACITY DATE
---- -------- ----
/s/ James E. Donegan Chief Executive May 24, 2001
----------------------------------------
James E. Donegan Officer and Chairman of the
Board of Directors
/s/ Frank R. DiPietro Executive Vice President, Chief May 24, 2001
----------------------------------------
Frank R. DiPietro Financial Officer and Treasurer
/s/ Manfred Loeb Director May 24, 2001
----------------------------------------
Manfred Loeb
/s/ Willy M.C. Sansen Director May 24, 2001
----------------------------------------
Willy M.C. Sansen
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/s/ John L. Sprague Director May 24, 2001
----------------------------------------
John L. Sprague
/s/ Lionel H. Olmer Director May 24, 2001
----------------------------------------
Lionel H. Olmer
/s/ Douglas M. McBurnie Director May 24, 2001
----------------------------------------
Douglas M. McBurnie
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INDEX TO EXHIBITS
Exhibit
Number Description of Exhibit
------- ----------------------
3.1 -- Articles of Organization (filed as Exhibit 3.2 to Registration
Statement on Form S-1, File No. 333-1328, and incorporated
herein by reference).
3.2 -- Restated By-Laws (filed as Exhibit 3.3 to Registrant's
Registration Statement on Form S-1, File No. 333-1328, and
incorporated herein by reference).
4.1 -- Form of Stock Purchase Agreement by and between the Registrant
and each of the Selling Stockholders.
5.1 -- Legal opinion of Testa, Hurwitz & Thibeault, LLP
23.1 -- Consent of KPMG LLP
23.2 -- Consent of Sallmann, Yang & Alameda
23.3 -- Consent of Testa, Hurwitz & Thibeault, LLP (included in
Exhibit 5.1)
24.1 -- Power of attorney (contained on signature page)