-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, FJY/2i0tey7g0RKTabzaw5PHlssJib7hGiojqP/HKxWya3SDk50llqVP1yAzDrrR jlXAik/tb1SVa73UJE4P+Q== 0000950123-99-008046.txt : 19990830 0000950123-99-008046.hdr.sgml : 19990830 ACCESSION NUMBER: 0000950123-99-008046 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 7 FILED AS OF DATE: 19990827 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALPHARMA INC CENTRAL INDEX KEY: 0000730469 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 222095212 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: SEC FILE NUMBER: 333-86037 FILM NUMBER: 99701017 BUSINESS ADDRESS: STREET 1: ONE EXECUTIVE DR STREET 2: P O BOX 1399 CITY: FORT LEE STATE: NJ ZIP: 07024 BUSINESS PHONE: 2019477774 FORMER COMPANY: FORMER CONFORMED NAME: A L PHARMA DATE OF NAME CHANGE: 19960513 FORMER COMPANY: FORMER CONFORMED NAME: A L LABORATORIES INC DATE OF NAME CHANGE: 19920703 S-3 1 ALPHARMA INC. 1 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 27, 1999 REGISTRATION NO. 333- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------ ALPHARMA INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) ------------------------ DELAWARE 22-2095212 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
ONE EXECUTIVE DRIVE FORT LEE, NEW JERSEY 07024 TELEPHONE: (201) 947-7774 (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL OFFICES) ROBERT F. WROBEL VICE PRESIDENT AND CHIEF LEGAL OFFICER ALPHARMA INC. ONE EXECUTIVE DRIVE FORT LEE, NEW JERSEY 07024 TELEPHONE: (201) 947-7774 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE) COPY TO: GLEN E. HESS, P.C. KIRKLAND & ELLIS CITICORP CENTER 153 EAST 53RD STREET NEW YORK, NEW YORK 10022 (212) 446-4800 ------------------------ APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to time after the effective date of this Registration Statement. If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box: [ ] If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box: [X] If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box: [ ] ------------------------ CALCULATION OF REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------ PROPOSED MAXIMUM TITLE OF EACH CLASS OF AGGREGATE OFFERING AMOUNT OF SECURITIES TO BE REGISTERED(1) PRICE(2) REGISTRATION FEE(3) - ------------------------------------------------------------------------------------------------------------ Debt Securities and Class A Common Stock, par value $.20 per share..................................................... $250,000,000 $69,500 - ------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------
(1) Includes shares of Class A Common Stock that may be issued upon conversion of Debt Securities. Also includes securities issuable upon conversion of convertible securities for no separate consideration. (2) Or the equivalent thereof in one or more foreign currencies or composite currencies, including the Euro. If any Debt Securities are issued at an original issue discount, then the aggregate initial offering price as so discounted shall not exceed $250,000,000, notwithstanding that the stated principal amount of such securities may exceed such amount. (3) The registration fee has been calculated pursuant to Rule 457(o) and reflects the offering price rather than the principal amount of any Debt Securities issued at a discount. ------------------------ 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 THAT 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 SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 2 THE INFORMATION IN THIS PRELIMINARY PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT COVERING THEM HAS BEEN DECLARED EFFECTIVE BY THE SEC. THIS PRELIMINARY PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND WE ARE NOT SOLICITING OFFERS TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED. SUBJECT TO COMPLETION, DATED AUGUST 27, 1999 Prospectus $250,000,000 [ALPHARMA LOGO] DEBT SECURITIES CLASS A COMMON STOCK ------------------------- We may use this prospectus to offer and sell securities from time to time. The types of securities we may sell include: - - senior debt securities - Class A common stock - - subordinated debt securities
We will provide the specific terms of these securities in supplements to this prospectus prepared in connection with each offering. These terms may include: In the case of any securities: In the case of debt securities: - - offering price - denomination or currency - - size of offering - interest rate - - underwriting discounts - maturity - ranking - whether they may be redeemed prior to maturity - whether they are convertible into common stock
The securities offered will contain other significant terms and conditions. Please read this prospectus and the applicable prospectus supplement carefully before you invest. THIS INVESTMENT INVOLVES RISKS. SEE "RISK FACTORS" BEGINNING ON PAGE 1. Our Class A common stock is traded on the New York Stock Exchange under the symbol "ALO." ------------------------- Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities or passed upon the adequacy or accuracy of the prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is , 1999. 3 ------------------------- TABLE OF CONTENTS
PAGE ---- Forward-Looking Statements.................................. i Incorporation by Reference.................................. i Risk Factors................................................ 1 Our Company................................................. 7 Where You Can Find More Information......................... 8 Use of Proceeds............................................. 6 Ratio of Earnings to Fixed Charges.......................... 6 Description of Debt Securities.............................. 9 Description of Capital Stock................................ 15 Book-Entry.................................................. 16 Plan of Distribution........................................ 19 Legal Matters............................................... 20 Experts..................................................... 20
------------------------- FORWARD-LOOKING STATEMENTS This prospectus contains "forward-looking statements," or statements that are based on current expectations, estimates, and projections rather than historical facts. We offer these forward-looking statements in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may prove, in hindsight, to have been inaccurate because of risks and uncertainties that are difficult to predict. Many of the risks and uncertainties that we face are included under the caption "Risk Factors." We are not obligated to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this prospectus might not occur. INCORPORATION BY REFERENCE We have filed the following documents with the Securities and Exchange Commission. These documents are incorporated herein by reference as of their respective dates of filing and shall be deemed to be a part of this prospectus: 1. Our Annual Report on Form 10-K for the year ended December 31, 1998. 2. Our Quarterly Reports on Form 10-Q for the quarters ended March 31, 1999 and June 30, 1999 and on Form 10-Q/A for the quarter ended June 30, 1999. 3. Our Current Reports on Form 8-K dated February 23, 1999, June 17, 1999 and July 2, 1999. i 4 All documents and reports which we file pursuant to Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 after the date of this prospectus are also incorporated by reference in this prospectus and will be deemed a part of this prospectus from the date of filing of the document or report. Statements contained in documents incorporated or deemed to be incorporated by reference after the date of this prospectus will modify statements in any other subsequently filed documents to the extent the new information differs from the old information. Any statements modified or superseded will no longer constitute a part of this prospectus in their original form. We will provide you without charge, upon request, with a copy of any or all of the documents referred to above which have been or may be incorporated in the prospectus by reference, other than exhibits to such documents unless the exhibits themselves are specifically incorporated by reference. Requests for such copies should be directed to Alpharma Inc., One Executive Drive, Fort Lee, New Jersey 07024, Attention: Investor Relations Department (telephone number: (201) 947-7774). ii 5 RISK FACTORS You should carefully consider the following risks as well as other information contained in this prospectus before deciding to invest in any offered securities. OUR SUBSTANTIAL INDEBTEDNESS COULD LIMIT OUR ABILITY TO OBTAIN ADDITIONAL FINANCING, LIMIT OUR OPERATING FLEXIBILITY AND MAKE US MORE VULNERABLE TO ECONOMIC DOWNTURNS. As of June 30, 1999, we had total outstanding long-term indebtedness of approximately $600 million, or approximately 69% of our total capitalization. In addition, we had $93 million of availability under our revolving credit facility and short-term European line, subject to the satisfaction of the financial tests and maintenance of the financial ratios we describe in this document and our other public filings. These tests and covenants include an interest coverage ratio, total debt to EBITDA and equity to asset ratio. This level of indebtedness could: - limit our ability to obtain additional financing - limit our operating flexibility as a result of covenants contained in our credit facility - make us more vulnerable to economic downturns and - limit our ability to pursue other business opportunities. Also, we are vulnerable to fluctuations in interest rates since approximately $294 million of our debt at June 30, 1999 was at variable interest rates. We believe that we are more leveraged than many of our competitors. Our acquisition of the Isis Group resulted in an equity to total asset ratio under our revolving credit facility of 24.5% as of June 30, 1999. A ratio of below 25% requires an increase in the interest rate margin under our revolving credit facility of .75%. We are required to increase the equity to total asset ratio under our revolving credit facility to at least 25% by December 18, 1999. A failure to meet this minimum ratio by December 18, 1999 would constitute an event of default under our revolving credit facility and would have a material adverse effect on us. POTENTIAL ACQUISITIONS MAY REDUCE OUR EARNINGS, BE DIFFICULT TO INTEGRATE INTO OUR COMPANY AND REQUIRE ADDITIONAL FINANCING. We search for and evaluate acquisitions which will provide new product and market opportunities, leverage existing assets and add critical mass. Acquisitions commonly involve risks and may have a material effect on our results of operations. Any acquisitions we make may fail to accomplish our strategic objectives, may not be successfully integrated with our operations and may not perform as expected. In addition, based on current acquisition prices in the pharmaceutical industry, acquisitions could initially be dilutive to our earnings and add significant intangible assets and related goodwill amortization charges. Our acquisition strategy will require additional debt or equity financing, resulting in additional leverage and dilution of ownership, respectively. We may not be able to finance acquisitions on terms satisfactory to us. 1 6 WE ARE SUBJECT TO GOVERNMENT REGULATIONS AND ACTIONS THAT INCREASE OUR COSTS AND COULD PREVENT US FROM MARKETING OR SELLING SOME OF OUR PRODUCTS IN CERTAIN COUNTRIES. The research, development, manufacturing and marketing of our products are subject to extensive government regulation. Government regulation includes inspection of and controls over testing, manufacturing, safety, efficacy, labeling, record keeping, sale and distribution of pharmaceutical products. The U.S. and other governments regularly review manufacturing operations. Noncompliance with applicable requirements can result in fines, recall or seizure of products, suspension of production and debarment of individuals or our company from obtaining new drug approvals. Government regulation substantially increases the cost of manufacturing, developing and selling our products. We have filed applications to market our products with the United States Food and Drug Administration and other regulatory agencies both in the U.S. and internationally. The timing of receipt of approvals of these applications can significantly affect future revenues and income. This is particularly significant with respect to human pharmaceuticals at the end of third parties' patent protection. There can be no assurance that we will obtain new product approvals in a timely manner, if ever. Failure to obtain approvals, or to obtain them when expected, could have a material adverse effect on our business. We also have affiliations, license agreements and other arrangements with companies, such as Ascent Pediatrics, Inc., which arrangements depend on regulatory approvals sought by such companies. The European Union and five non-EU countries have banned the use of bacitracin zinc, a feed antibiotic growth promoter, in livestock feeds effective July 1, 1999. Our initial effort to reverse this action by means of a court injunction from the Court of First Instance of the European Court was denied. We are making further attempts to reverse or limit this action, with particular emphasis on political means. Although we may not succeed, we believe that strong scientific evidence exists to refute the EU position. In addition, other countries are considering a similar ban. If the loss of bacitracin zinc sales is limited to the European Union and those countries that have already taken similar action, we do not anticipate a material adverse effect. If either (a) other countries more important to our sales of bacitracin-based products ban these products or (b) the European Union (or countries or customers within the EU) acts to prevent the importation of meat products from countries that allow the use of bacitracin-based products, we could be materially affected. We cannot predict whether the present bacitracin zinc ban will be expanded. OUR FOREIGN OPERATIONS ARE SUBJECT TO ADDITIONAL ECONOMIC AND POLITICAL RISKS. Our foreign operations are subject to currency exchange fluctuations and restrictions, political instability in some countries, and uncertainty as to the enforceability of, and government control over, commercial rights. Some of our foreign operations, particularly in Indonesia where we have a manufacturing facility and Brazil where we have recently added significant sales, are being affected by wide currency fluctuations and decreased economic activity in these regions and, in case of Indonesia, by social and political unrest. While our present exposure to economic factors in these regions is not material, they are important areas for anticipated future growth. 2 7 We sell products in many countries that are recognized to be susceptible to significant foreign currency risk. These products are generally sold for U.S. dollars, which eliminates the direct currency risk but increases credit risk if the local currency devalues significantly and it becomes more difficult for customers to purchase U.S. dollars required to pay us. Recent acquisitions in Europe may increase the foreign currency risk. OUR OPERATING RESULTS HAVE VARIED IN THE PAST AND MAY CONTINUE TO DO SO. Our businesses may experience variations in revenues and net income as a result of many factors, including acquisitions, delays in the introduction of new products, success or failures of strategic alliances and joint ventures, management actions and the general conditions of the pharmaceutical and animal health industries. MANY OF OUR COMPETITORS HAVE MORE RESOURCES THAN WE HAVE. All of our businesses operate in highly competitive markets and many of our competitors are substantially larger and have greater financial, technical and marketing resources. As a result, we may be at a disadvantage in our ability to develop and market new products to meet competitive demands. WE HAVE BEEN AND WILL CONTINUE TO BE AFFECTED BY THE COMPETITIVE AND CHANGING NATURE OF THE PHARMACEUTICAL INDUSTRY. Our U.S. generic pharmaceutical business has historically been subject to intense competition. As patents and other bases for market exclusivity expire, prices typically decline as generic competitors enter the marketplace. Normally, there is a further unit price decline as the number of generic competitors increases. The timing of these price decreases is unpredictable and can result in a significantly curtailed period of profitability for a generic product. In addition, brand-name manufacturers frequently take actions to prevent or discourage the use of generic equivalents through marketing and regulatory activities and litigation. Generic pharmaceutical market conditions in the U.S. were further exacerbated in the second half of 1996 by a fundamental shift in industry distribution, purchasing and stocking patterns resulting from increased importance of sales to major wholesalers and a concurrent reduction in sales to private label generic distributors. We believe that this trend continues to date. Wholesaler programs generally require lower prices on products sold, lower inventory levels kept at the wholesaler and fewer manufacturers selected to provide products to the wholesaler's own marketing programs. The factors which have adversely affected the U.S. generic pharmaceutical industry may also affect some or all of the markets in which the international pharmaceutical division operates. In addition, in Europe we are encountering price pressure from imports of identical products from lower priced markets under EU laws of free movement of goods. Parallel imports could lead to lower volume growth. Our international pharmaceutical division is also affected by general governmental initiatives to reduce drug prices. Both parallel imports and governmental cost containment could cause lower prices in certain markets including the Nordic countries where we have significant sales. It is difficult for us to respond to competitive challenges because of the significance of relatively few major customers, such as large wholesalers and chain stores, a rapidly changing market and uncertainty of timing of new product approvals. 3 8 FUTURE INABILITY TO OBTAIN RAW MATERIALS OR PRODUCTS FROM CONTRACT MANUFACTURERS COULD SERIOUSLY AFFECT OUR OPERATIONS. We currently purchase many of our raw materials and other products from single suppliers. Although we have not experienced difficulty to date, we may experience supply interruptions in the future and may have to obtain substitute materials or products. If we had to obtain substitute materials or products, we would require additional regulatory approvals. Any significant interruption of supply from our suppliers could have a material adverse effect on our operations. OUR BUSINESS IS AFFECTED BY THE POLICIES OF THIRD-PARTY PAYORS, SUCH AS INSURERS AND MANAGED CARE ORGANIZATIONS. Our commercial success with respect to generic products depends, in part, on the availability of adequate reimbursement from third-party health care payors, such as government and private health insurers and managed care organizations. Third-party payors are increasingly challenging the pricing of medical products and services and their reimbursement practices may prevent us from maintaining our present product price levels. In addition, the market for our products may be limited by third-party payors who establish lists of approved products and do not provide reimbursement for products not listed. SOME OF OUR PRODUCTS MAY BE SUBJECT TO PRODUCT LIABILITY CLAIMS. Continuing studies are being conducted by the industry, government agencies and others. These studies increasingly employ sophisticated methods and techniques and can call into question the utilization, safety and efficacy of previously marketed products. In some cases, these studies have resulted in the removal of products from the market and have given rise to claims for damages from previous users. Our business could be harmed by such actions. OUR RELATIONSHIP WITH OUR CONTROLLING STOCKHOLDER COULD LEAD TO CONFLICTS OF INTEREST. A.L. Industrier AS, or Industrier, is the beneficial owner of 100% of the outstanding shares of the Class B common stock. Industrier also owns $67.8 million of our 5 3/4% convertible subordinated notes due 2005 which are convertible into Class B common stock. As a result of its stock ownership, Industrier controls Alpharma and is presently entitled to elect two-thirds of the members of our board of directors. Einar Sissener, Chairman of the Board and Chairman of the Office of the Chief Executive of Alpharma, controls a majority of Industrier's outstanding shares and is Chairman of Industrier. In addition, Mr. Sissener beneficially owns 338,668 shares of Class A common stock. Gert Munthe, President and Chief Executive Officer of Alpharma, is the son-in-law of Mr. Sissener and a director of Industrier. Alpharma and Industrier engage in various transactions from time to time, and conflicts of interest are present with respect to the terms of such transactions. All contractual arrangements between Alpharma and Industrier are subject to review by, or ratification of, a committee of our board of directors consisting of one or more directors who are unaffiliated with Industrier, as to the fairness of the terms and conditions of such arrangements to Alpharma. 4 9 THE MARKET PRICE OF OUR COMMON STOCK MAY BE HIGHLY VOLATILE BECAUSE OF INTERNAL AND EXTERNAL FACTORS. The stock market has from time to time experienced significant price and volume fluctuations that may be unrelated to the operating performance of particular companies. In addition, the market price of our Class A common stock, like the stock prices of many publicly traded pharmaceutical companies, has been and may continue to be highly volatile. The sale by our major shareholders or members of our management of shares of common stock, management actions, announcements of technological innovations or new commercial products by Alpharma or its competitors, publicity regarding actual or potential medical results relating to marketed products, regulatory developments in either the U.S. or foreign countries, public concern as to the safety of pharmaceutical and animal health products, factors present in foreign operations, the loss of suppliers or contract manufacturers, third-party reimbursement pressures, potential liability for current products and economic and other external factors, as well as period-to-period fluctuations in financial results, among other factors, may have a significant impact on the market price of the Class A common stock. 5 10 USE OF PROCEEDS Unless the applicable prospectus supplement provides otherwise, we intend to use the net proceeds from the sale of the offered securities to reduce our indebtedness and for general corporate purposes, including capital expenditures and acquisitions. We believe that any issuance of equity offered by this prospectus will enhance our ability to finance future acquisitions, including incurring additional debt. We may reborrow any amounts that we repay under our credit facility. We are evaluating several possible acquisition candidates but, other than as incorporated by reference or described in this prospectus, we currently have no agreement or understanding regarding any material acquisition. RATIO OF EARNINGS TO FIXED CHARGES The following table sets forth the ratio of earnings to fixed charges for Alpharma and its subsidiaries on a consolidated basis for each of the periods indicated. We calculated the ratio of earnings to fixed charges by dividing earnings by total fixed charges. Earnings consist of pretax income plus fixed charges and amortization of capitalized interest less capitalized interest. Fixed charges consist of interest expense on all indebtedness (including amortization of deferred debt issuance costs) and a portion of rent expense (33%) we estimated to be the interest component of those rentals.
SIX MONTHS YEAR ENDED DECEMBER 31, ENDED JUNE 30, - -------------------------------- -------------- 1994 1995 1996 1997 1998 1999 - ---- ---- ---- ---- ---- -------------- 1.07x 2.24x --(1) 2.31x 2.29x 2.31x
- ------------------------- (1) Earnings in 1996 were not sufficient to cover fixed charges. The deficiency of earnings was $16.4 million. 6 11 OUR COMPANY We are a multinational pharmaceutical company that develops, manufactures and markets specialty human pharmaceutical and animal health products. We manufacture and market approximately 620 pharmaceutical products for human use and 40 animal health products. We conduct our business in more than 60 countries and have approximately 3,200 employees at 40 sites in 22 countries. For the year ended December 31, 1998, we generated revenue of over $600 million and operating income of $65 million. Our human pharmaceutical business is the largest manufacturer and marketer of generic liquid and topical pharmaceuticals in the U.S. In addition, we have leading and expanding positions internationally, especially in Europe, where we have leading positions in branded generic in the Nordic countries and a substantial generic pharmaceutical market presence in the UK, Netherlands, Germany and France, through recent acquisitions. Further, through our fine chemicals division, we are the world's leading producer of bacitracin, bacitracin zinc and polymixin, which are important pharmaceutical grade antibiotics. Our human pharmaceutical business generated approximately $420 million of revenue, or approximately 70% of our total revenues, for the year ended December 31, 1998. On June 18, 1999 we acquired Isis Pharma and Isis Puren, the German generic businesses of Schwarz Pharma AG. The acquisition consisted of sales personnel, product registrations, patents and trademarks. Isis had 1998 revenues in Germany of approximately $75 million and has about 200 employees, of which 140 are in the sales force. Schwarz Pharma has agreed to continue to supply some of the more substantial Isis products for a period of four years and all remaining products for one year. Approximately 80% of Isis' sales consist of cardiovascular products. The most important product of Isis is the cardiovascular drug Pentalong(TM). Our animal health business is a leading provider of animal feed additives for the poultry, cattle and swine industries, as well as vaccines for the aquaculture industry. We are the market leader in the manufacture and sale of bacitracin-based feed additives sold under the trade names BMD(R)and Albac. In addition, we believe that we have a significant market share with several other of our feed additives, including those sold under our Deccox and 3-Nitro(R) brands. In aquatic animal health, we believe we are a leader in the development, manufacture and marketing of vaccines for use in immunizing farmed fish against disease. Our animal health business generated approximately $185 million of revenue, or approximately 30% of our total revenues, for the year ended December 31, 1998. We were originally organized as A.L. Laboratories, Inc., a wholly owned subsidiary of Apothekernes Laboratorium A.S., a Norwegian healthcare company, the predecessor company to A.L. Industrier AS. In 1994, we acquired the complementary human pharmaceutical and animal health business of our parent company and subsequently changed our name to Alpharma Inc. to operate worldwide as one corporate entity. Our principal executive offices are located at One Executive Drive, Fort Lee, New Jersey 07024. 7 12 WHERE YOU CAN FIND MORE INFORMATION We file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read and copy these reports, statements and other information at the SEC's public reference rooms at: - Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549; - Seven World Trade Center, 13th Floor, New York, New York 10048; or - Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. In addition, our Class A common stock and our convertible subordinated notes due 2005 are traded on the New York Stock Exchange under the symbols "ALO" and "ALO5 DOS" respectively and reports, proxy and information statements and other information about us can also be inspected at the offices of the Exchange, 20 Broad Street, New York, New York 10005. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference rooms. You can also request copies of these documents, for a copying fee, by writing to the SEC. Our SEC filings can also be reviewed by accessing the SEC's Internet site at http://www.sec.gov, which contains reports, proxy and information statements and other information. 8 13 DESCRIPTION OF DEBT SECURITIES We will issue debt securities in one or more series under an indenture between our company and First Union National Bank, as Trustee, the form of which we have filed as an exhibit to the Registration Statement. The following summaries of certain provisions of the indenture are not complete and are qualified in their entirety by express reference to the indenture and the securities resolutions or the indentures supplemental thereto (copies of which have been or will be filed with the Commission). Capitalized terms used in this section without definition have the meanings given to them in the indenture. GENERAL The indenture does not limit the amount of debt securities that can be issued thereunder and provides that the debt securities may be issued from time to time in one or more series pursuant to the terms of one or more securities resolutions or supplemental indentures. As of the date of this prospectus, there were no debt securities outstanding under the indenture. The debt securities will be unsecured and will have the ranking set forth in the terms of any supplements to this prospectus. TERMS We will determine the terms of the debt securities at the time or times of sale. We will provide the specific terms of each series in supplements to this prospectus. Reference is made to the prospectus supplement for the following terms, if applicable, of the debt securities offered thereby: - designation, aggregate principal amount, currency or composite currency and denominations - terms of any redemption at the option of Holders - price and, if an index formula or other method is used, the method for determining amounts of principal or interest - maturity date and other dates, if any, on which principal will be payable - interest rate (which may be fixed or variable), if any - date or dates from which interest will accrue and on which interest will be payable, and the record dates for the payment of interest - place or places where principal and interest will be payable and on which interest will be payable, and the record dates for the payment of interest - tax indemnity provisions - terms of any mandatory or optional redemption by us including any sinking fund - terms of any conversion or exchange right - if the debt securities provide that payments of principal or interest may be made in a currency other than that in which debt securities are denominated, the manner for determining the payments 9 14 - portion of principal payable upon acceleration of a Discounted Debt Security (as defined below) - ranking - whether and upon what terms debt securities may be defeased - manner of paying principal and interest - any events of default or the covenants in addition to or in lieu of those set forth in the indenture - provisions for electronic issuance of debt securities or for debt securities in uncertificated form - any additional provisions or other special terms not inconsistent with the provisions of the indenture, including any terms that may be required or advisable under United States or other applicable laws or regulations, or advisable in connection with the marketing of the debt securities. We may issue debt securities of any series as registered debt securities, bearer debt securities or uncertificated debt securities, and in denominations as specified in the terms of the series. (Section 2.01) In connection with its original issuance, no bearer debt security will be offered, sold or delivered to any location in the United States, and a bearer debt security in definitive form may be delivered in connection with its original issuance only upon presentation of a certificate in a form prescribed by us to comply with United States laws and regulations. (Section 2.04) Registration of transfer of registered debt securities may be requested upon surrender thereof at any agency of ours maintained for that purpose and upon fulfillment of all other requirements of the agent. (Sections 2.03 and 2.07) Under the indenture we may issue debt securities as Discounted Debt Securities to be offered and sold at a substantial discount from the principal amount thereof. Special United States federal income tax and other considerations applicable thereto will be described in the prospectus supplement relating to the Discounted Debt Securities. "Discounted Debt Security" means a debt security where the amount of principal due upon acceleration is less than the stated principal amount. (Section 2.10) CERTAIN COVENANTS Unless otherwise specified in the applicable prospectus supplement, the debt securities will not be secured by any properties or assets and will represent unsecured debt of our company. Any restrictive covenants which may apply to a particular series of debt securities will be described in the prospectus supplement relating to that series. The indenture does not limit our ability to enter into sale and leaseback transactions. Unless otherwise indicated in a prospectus supplement, these covenants, if applicable, do not afford holders of the debt securities protection in the event of a highly leveraged or other transaction involving us that may adversely affect holders of the debt securities. 10 15 SUCCESSOR OBLIGOR Unless otherwise specified in the securities resolution establishing a series of debt securities, we shall not consolidate with or merge into, or transfer all or substantially all of our assets to, any person in any transaction in which we are not the survivor, unless: (1) the person is organized under the laws of the United States or a State thereof or is organized under the laws of a foreign jurisdiction and consents to the jurisdiction of the courts of the United States or a State thereof; (2) the person assumes by supplemental indenture all of our obligations under the indenture, the debt securities and any coupons; and (3) immediately after the transaction no Default (as defined) exists. The successor shall be substituted for us, and thereafter all of our obligations under the indenture, the debt securities and any coupons shall terminate. (Section 5.01) EXCHANGE OF DEBT SECURITIES Registered debt securities may be exchanged for an equal aggregate principal amount of registered debt securities of the same series and date of maturity in the authorized denominations as may be requested upon surrender of the registered debt securities at an agency of ours maintained for that purpose and upon fulfillment of all other requirements of the agent. (Section 2.07) DEFAULT AND REMEDIES Unless the securities resolution establishing the series otherwise provides (in which event the prospectus supplement will so state), an "Event of Default" with respect to a series of debt securities will occur if: (1) we default in any payment of interest on any debt securities of the series when the same becomes due and payable and the Default continues for a period of 60 days; (2) we default in the payment of the principal and premium, if any, of any debt securities of the series when the same becomes due and payable at maturity or upon redemption, acceleration or otherwise and the default shall continue for five or more days; (3) we default in the payment or satisfaction of any sinking fund obligation with respect to any debt securities of a series as required by the securities resolution establishing the series and the Default continues for a period of 60 days; (4) we default in the performance of any of its other agreements applicable to the series and the Default continues for 90 days after the notice specified below; (5) pursuant to or within the meaning of any Bankruptcy Law: (a) we commence a voluntary case, (b) we consent to the entry of an order for relief against us in an involuntary case, 11 16 (c) we consent to the appointment of a Custodian for us or for all or substantially all of our property, or (d) we make a general assignment for the benefit of our creditors; (6) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: (a) is for relief against us in an involuntary case, (b) appoints a Custodian for us or for all or substantially all of our property, or (c) orders that we be liquidated, and the order or decree remains unstayed and in effect for 60 days; or (7) there occurs any other Event of Default provided for in the series. (Section 6.01) The term "Bankruptcy Law" means Title 11, U.S. Code or any similar Federal or State law for the relief of debtors. The term "Custodian" means any receiver, trustee, assignee, liquidator or a similar official under any Bankruptcy Law. (Section 6.01) "Default" means any event which is, or after notice or passage of time would be, an Event of Default. A Default under subparagraph (4) above is not an Event of Default until the Trustee or the Holders of at least 33 1/3% in principal amount of the series notify us of the Default and we do not cure the Default within the time specified after receipt of the notice. (Section 6.01) The Trustee may require indemnity satisfactory to it before it enforces the indenture or the debt securities of the series. (Section 7.01) Subject to certain limitations, Holders of a majority in principal amount of the debt securities of the series may direct the Trustee in its exercise of any trust or power with respect to the series. (Section 6.05) Except in the case of Default in payment on a series, the Trustee may withhold from Securityholders of the series notice of any continuing Default (except a Default in payment of principal or interest) if it determines that withholding notice is in their interest. (Section 7.04) We are required to furnish the Trustee annually a brief certificate as to our compliance with all conditions and covenants under the indenture. (Section 4.04) The failure to redeem any debt securities subject to a Conditional Redemption (as defined) is not an Event of Default if any event on which the redemption is so conditioned does not occur and is not waived before the scheduled redemption date. (Section 6.01) The indenture does not have a cross-default provision. Thus, a default by us on any other debt, including any other series of debt securities, would not constitute an Event of Default. AMENDMENTS AND WAIVERS The indenture and the debt securities or any coupons of the series may be amended, and any default may be waived as follows: Unless the securities resolution otherwise provides (in which event the prospectus supplement will so state), the debt securities and the indenture may be amended with the consent of the Holders of a majority in principal amount of the debt securities of all series affected voting as one class. (Section 9.02) Unless the securities resolution otherwise provides (in which event the prospectus 12 17 supplement will so state), a Default on a particular series may be waived with the consent of the Holders of a majority in principal amount of the debt securities of the series. (Section 6.04) However, without the consent of each Holder affected, no amendment or waiver may: (1) reduce the amount of debt securities whose Holders must consent to an amendment or waiver; (2) reduce the interest on or change the time for payment of interest on any debt security; (3) change the fixed maturity of any debt security; (4) reduce the principal of any non-Discounted Debt Security or reduce the amount of the principal of any Discounted Debt Security that would be due on acceleration thereof; (5) change the currency in which the principal or interest on a debt security is payable; (6) make any change that materially adversely affects the right to convert any debt security; or (7) waive any Default in payment of interest on or principal of a debt security. (Sections 6.04 and 9.02) Without the consent of any Holder, the indenture or the debt securities may be amended: (1) to cure any ambiguity, omission, defect or inconsistency; (2) to provide for assumption of Company obligations to Holders in the event of a merger or consolidation requiring the assumption; (3) to provide that specific provisions of the indenture shall not apply to a series of debt securities not previously issued; (4) to create a series and establish its terms; (5) to provide for a separate trustee for one or more series; or (6) to make any change that does not materially adversely affect the rights of any Holder. (Section 9.01) LEGAL DEFEASANCE AND COVENANT DEFEASANCE Debt securities of a series may be defeased in accordance with their terms and, unless the securities resolution establishing the terms of the series otherwise provides, as set forth below. We at any time may terminate as to a series all of our obligations (except for certain obligations, including obligations with respect to the defeasance trust and obligations to register the transfer or exchange of a debt security, to replace destroyed, lost or stolen debt securities and coupons and to maintain paying agencies in respect of the debt securities) with respect to the debt securities of the series and any related coupons and the indenture ("legal defeasance"). We at any time may terminate as to a series our obligations with respect to the debt securities and coupons of the series under any 13 18 restrictive covenants which may be applicable to a particular series ("covenant defeasance"). We may exercise our legal defeasance option notwithstanding our prior exercise of our covenant defeasance option. If we exercise our legal defeasance option, a series may not be accelerated because of an Event of Default. If we exercise our covenant defeasance option, a series may not be accelerated by reference to any restrictive covenants which may be applicable to that series. (Section 8.01) To exercise either defeasance option as to a series, we must: (1) irrevocably deposit in trust (the "defeasance trust") with the Trustee or another trustee money or U.S. Government Obligations, deliver a certificate from a nationally recognized firm of independent accountants expressing their opinion that the payments of principal and interest when due on the deposited U.S. Government Obligations, without reinvestment, plus any deposited money without investment will provide cash at the times and in the amounts as will be sufficient to pay the principal and interest when due on all debt securities of that series to maturity or redemption, as the case may be, and (2) comply with certain other conditions. In particular, we must obtain an opinion of tax counsel that the defeasance will not result in recognition of any gain or loss to holders for Federal income tax purposes. "U.S. Government Obligations" means direct obligations of the United States or an instrumentality of the United States, the payment of which is unconditionally guaranteed by the United States, which, in either case, have the full faith and credit of the United States of America pledged for payment and which are not callable at the issuer's option, or certificates representing an ownership interest in those obligations. (Section 8.02) REGARDING THE TRUSTEE First Union National Bank will act as Trustee for debt securities issued under the indenture and, unless otherwise indicated in a prospectus supplement, the Trustee will also act as Registrar and Paying Agent with respect to the debt securities. (Section 2.03) 14 19 DESCRIPTION OF CAPITAL STOCK Our authorized capital stock currently consists of: (i) 50,000,000 shares of Class A common stock, of which 18,036,351 shares were outstanding as of June 30, 1999, (ii) 15,000,000 shares of Class B common stock, $.20 par value per share, of which 9,500,000 shares were issued and outstanding as of June 30, 1999, and (iii) 500,000 shares of preferred stock, par value $1.00 per share, none of which were issued and outstanding as of June 30, 1999. The following description of our capital stock is a summary of provisions of our amended and restated certificate of incorporation and is qualified in its entirety by the provisions of that document which has been filed with the SEC. As of June 30, 1999, the Class A common stock was held of record by approximately 1,788 stockholders. COMMON STOCK The Class A common stock and the Class B common stock are identical in all respects, including with respect to the right to receive dividends, except as follows: (1) the holders of the Class A common stock are currently entitled as class to elect 33 1/3% of the Board of Directors (rounded to the nearest whole number, but not less than two members of the Board of Directors), and the holders of the Class B common stock are entitled as a class to elect the remaining directors; (2) on all other matters submitted to a vote of stockholders, the holders of the Class A common stock are entitled to one vote per share of Class A common stock held, and the holders of the Class B common stock are entitled to four votes per share of Class B common stock held; (3) the holders of the Class B common stock have the right at any time and from time to time to convert each share of Class B common stock into one share of Class A common stock; and (4) shares of Class A common stock may be declared and paid as dividends on shares of both Class A common stock and Class B common stock; shares of Class B common stock may be declared and paid as dividends on shares of both Class A common stock and Class B common stock; shares of Class A common stock may be declared and paid as dividends on shares of Class A common stock and shares of Class B common stock may be declared and paid as dividends on shares of Class B common stock; and in any such case the same number of shares must be declared and paid as dividends in respect of each outstanding share of Class A common stock and each outstanding share of Class B common stock. The special voting rights of the holders of the Class A common stock as reflected in clause (1) above terminate if the number of outstanding shares of Class A common stock is less than 10% of the aggregate number of issued and outstanding shares of Class A common stock and Class B common stock, and the special voting rights of the holders of the Class B common stock as reflected in clauses (1) and (2) above terminate if the number of issued and outstanding shares of Class B common stock is less than 12 1/2% of such aggregate number, in each case as determined on the record for the stockholder vote. We may not subdivide or combine either class of common stock without at the same time combining or subdividing shares of the other class of common stock in the same proportion. Upon liquidation of Alpharma, holders of the Class A common stock and the Class B common stock are entitled to share ratably in any assets available for distribution to stockholders after payment of all our obligations, and payments due in respect of any other of our senior securities, including any shares of preferred stock. Holders of common stock do not have cumulative voting rights or preemptive, subscription or, except as set forth above with respect to the Class B common stock, conversion rights. 15 20 PREFERRED STOCK We may issue the preferred stock in one or more series, with designations, relative rights, powers, priorities, preferences and limitations thereof as the Board of Directors, without any stockholder action, may determine, provided that we may not limit the right of the holders of Class A common stock, voting as a class, to elect no less than 25% of the Board of Directors by granting voting rights to any series of preferred stock. TRANSFER AGENT BankBoston, N.A. is the transfer agent for the common stock. BOOK-ENTRY DTC will act as securities depository for the debt securities. The debt securities will be issued only as fully registered securities registered in the name of Cede & Co. (DTC's partnership nominee). One or more fully registered global certificates will be issued for the debt securities representing the aggregate principal amount of the debt securities and will be deposited with DTC. DTC is a limited-purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the 1934 Act, as amended. DTC holds securities that its participants (the "Direct Participants") deposit with DTC. DTC also facilitates the settlement among Direct Participants of securities transactions, such as transfers and pledges, in deposited securities through electronic computerized book-entry changes in Direct Participants' accounts, thereby eliminating the need for physical movement of securities certificates. Direct Participants include securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations. DTC is owned by a number of its Direct Participants and by the New York Stock Exchange, Inc., the American Stock Exchange, Inc., and the National Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as securities brokers and dealers, banks and trust companies that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly (the "Indirect Participants," and together with the Direct Participants, the "Participants"). The rules applicable to DTC and its Participants are on file with the SEC. Purchases of the debt securities within the DTC system must be made by or through Direct Participants which will receive a credit for the debt securities on DTC's records. The ownership interest of each actual purchaser of each debt security (a "Beneficial Owner") will in turn be recorded on the Direct and Indirect Participants' respective records. Beneficial Owners will not receive written confirmation from DTC of their purchase, but Beneficial Owners are expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interest in the debt securities will be effected by entries made on the books of Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interest in debt securities except in the event that use of the book-entry system for the debt securities is discontinued. 16 21 The deposit of the debt securities with DTC and their registration in the name of Cede & Co. effect no change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the debt securities; DTC's records reflect only the identity of the Direct Participants to whose accounts the debt securities are credited, which may or may not be the Beneficial Owners. The Participants will remain responsible for keeping account of their holdings on behalf of their customers. Conveyance of notices and other direct communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time. Redemption notices shall be sent to Cede & Co. If less than all of the debt securities of an issue are being redeemed, DTC's practice will determine by lot the amount of the interest of each Direct Participant in the series to be redeemed. Neither DTC nor Cede & Co. will consent or vote with respect to the debt securities. Under its usual procedures, DTC mails an omnibus proxy (an "Omnibus Proxy") to the Participants as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts the debt securities are credited on the record date (identified in a listing attached to the Omnibus Proxy). Principal, premium, if any, and interest on the debt securities will be paid to DTC. DTC's practice is to credit Direct Participants' accounts on the relevant payment date in accordance with their respective holdings shown on DTC's records unless DTC has reason to believe that it will not receive payment on the payment date. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in "street-name," and will be the responsibility of the Participant and not of DTC, the underwriters, or us, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of principal, premium, if any, and interest to DTC is the responsibility of us or the Trustee. Disbursement of these payments to Direct Participants is the responsibility of DTC, and disbursement of these payments to the Beneficial Owners is the responsibility of Direct and Indirect Participants. DTC may discontinue providing its services as securities depository with respect to the debt securities at any time by giving reasonable notice to us. Under those circumstances and in the event that a successor securities depository is not obtained, certificates for the debt securities are required to be printed and delivered. In addition, we may decide to discontinue use of the system of book-entry transfers through DTC (or any successor securities depository). In that event, certificates for the debt securities will be printed and delivered. We will not have any responsibility or obligation to Participants or to the persons for whom they act as nominees with respect to the accuracy of the records of DTC, its nominees or any Direct or Indirect Participant with respect to any ownership interest in the debt securities, or with respect to payments or providing of notice to the Direct Participants, the Indirect Participants or the Beneficial Owners. So long as Cede & Co. is the registered owner of the debt securities, as nominee of DTC, references herein to holders of the debt securities shall mean Cede & Co. or DTC and shall not mean the Beneficial Owners of the debt securities. 17 22 DTC management is aware that some computer applications, systems, and the like for processing data ("Systems") that are dependent upon calendar dates, including dates before, on, and after January 1, 2000, may encounter "year 2000 problems." DTC has informed its Participants and other members of the financial community (the "Industry") that it has developed and is implementing a program so that its Systems, as the same relate to the timely payment of distributions (including principal and income payments) to security holders, book-entry deliveries, and settlement of trades within DTC, continue to function appropriately. This program includes a technical assessment and remediation plan, each of which is complete. Additionally, DTC's plan includes a testing phase, which is expected to be completed within appropriate time frames. However, DTC's ability to perform properly its services is also dependent upon other parties, including but not limited to issuers and their agents, as well as third party vendors from whom DTC licenses software and hardware, and third party vendors on whom DTC relies for information or the provision of services, including telecommunication and electrical utility service providers, among others. DTC has informed the industry that it is contracting (and will continue to contract) third party vendors from whom DTC acquires services to: (i) impress upon them the importance of such services being year 2000 compliant; and (ii) determine the extent of their efforts for year 2000 remediation (and, as appropriate, testing) of their services. In addition, DTC is in the process of developing such contingency plans as it deems appropriate. The information in this section concerning DTC and DTC's book-entry system has been obtained from DTC. 18 23 PLAN OF DISTRIBUTION The Company may sell securities through underwriters or dealers, directly to one or more purchasers or through agents. The applicable prospectus supplement will set forth the terms of the offering of any securities, including: - the names of any underwriters or agents - the proceeds to the Company from the sale - any other items constituting underwriters' compensation - any discounts or concessions allowed or re-allowed or paid to dealers - the purchase price of the securities - any underwriting discounts - any initial public offering price - any securities exchanges on which the securities may be listed If underwriters are used in the sale, securities will be acquired by the underwriters for their own account and may be resold from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. Those securities may be offered to the public either through underwriting syndicates represented by managing underwriters or by underwriters without a syndicate. Unless otherwise set forth in the applicable prospectus supplement, the obligations of the underwriters to purchase those securities will be subject to certain conditions precedent, and the underwriters will be obligated to purchase all of those securities if any of them are purchased. Any initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers may be changed from time to time. Only underwriters named in a prospectus supplement are deemed to be underwriters in connection with the securities offered thereby. We may sell securities directly or through agents designated by us from time to time. Any agent involved in the offer or sale of securities will be named, and any commissions payable by us to the agent will be set forth in the applicable prospectus supplement. Unless otherwise indicated in the applicable prospectus supplement, the agent will act on a best efforts basis for the period of its appointment. If so indicated in a prospectus supplement with respect to securities, we will authorize agents, underwriters or dealers to solicit offers by certain institutions to purchase securities from us at the public offering price set forth in the prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery on the date or dates stated in the prospectus supplement. Each contract will be for an amount not less than, and the aggregate principal amount of the securities sold pursuant to the contracts shall be not less nor more than, the respective amounts stated in the prospectus supplement. Institutions with whom the contracts, when authorized, may be made include commercial and savings banks, insurance companies, pension funds, investment companies, educational and 19 24 charitable institutions, and other institutions, but will in all cases be subject to our approval. The contracts will not be subject to any conditions except: (1) the purchase by an institution of the securities covered by its contract shall not at the time of delivery be prohibited under the laws of any jurisdiction in the United States to which the institution is subject, and (2) if the securities are being sold to underwriters, we shall have sold to the underwriters the total principal amount of the securities less the principal amount thereof covered by the contracts. The underwriters will not have any responsibility in respect of the validity or performance of the contracts. If dealers are utilized in the sale of any securities, we will sell those securities to the dealers, as principal. Any dealer may then resell those securities to the public at varying prices to be determined by the dealer at the time of resale. The name of any dealer and the terms of the transaction will be set forth in the prospectus supplement with respect to the securities being offered thereby. It has not been determined whether any series of securities will be listed on a securities exchange. Underwriters will not be obligated to make a market in any series of securities. We cannot predict the level of trading activity in, or the liquidity of, any series of securities. Any underwriters, dealers or agents participating in the distribution of securities may be deemed to be underwriters, and any discounts or commissions received by them on the sale or resale of securities may be deemed to be underwriting discounts and commissions under the Securities Act of 1933. Agents and underwriters may be entitled under agreements entered into with us to indemnification by us against certain liabilities, including liabilities under the Securities Act of 1933, or to contribution with respect to payments that the agents or underwriters may be required to make in respect thereof. Agents and underwriters may be customers of, engaged in transactions with, or perform services for, us or our affiliates in the ordinary course of business. LEGAL MATTERS Kirkland & Ellis, New York, New York (a partnership that includes professional corporations) will pass upon legal matters regarding the issuance of the securities and the validity of the common stock being issuable upon conversion of the securities. Mr. Glen E. Hess has been a director of Alpharma since 1983. Mr. Hess's professional corporation is a partner of Kirkland & Ellis, a law firm which since 1978 has performed significant legal services for Alpharma. EXPERTS The financial statements incorporated in this prospectus by reference to the Annual Report on Form 10-K for the year ended December 31, 1998, have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, independent accountants, given on the authority of said firm as experts in auditing and accounting. 20 25 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- $250,000,000 [ALPHARMA LOGO] ------------------------- PROSPECTUS ------------------------- , 1999 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 26 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. The following table sets forth the expenses of the Registrant in connection with the issuance and distribution of the securities being registered, other than underwriting discounts and commissions. All such amounts are estimates, other than the fees payable to the Securities and Exchange Commission. Securities and Exchange Commission registration fee......... $ 69,500 Legal fees and expenses..................................... 150,000 Accounting fees and expenses................................ 50,000 Printing.................................................... 200,000 Trustee's fees and expenses................................. 8,500 Miscellaneous............................................... 22,000 Total.................................................. $ 500,000*
- ------------------------- * All expenses, except the Securities and Exchange Commission registration fee, are estimated. ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS. Section 102(b)(7) of the General Corporation Law of the State of Delaware permits a Delaware corporation to limit the personal liability of its directors in accordance with the provisions set forth therein. The Restated Certificate of Incorporation of the Registrant provides that the personal liability of its directors shall be limited to the fullest extent permitted by applicable law. Section 145 of the General Corporation Law of the State of Delaware contains provisions permitting corporations organized thereunder to indemnify directors, officers, employees or agents against expenses, judgments and fines reasonably incurred and against certain other liabilities in connection with any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that such person was or is a director, officer, employee or agent of the corporation. The Restated Certificate of Incorporation of the Registrant provide for indemnification of its directors and officers to the fullest extent permitted by applicable law. II-1 27 ITEM 16. EXHIBITS. The following exhibits are filed pursuant to Item 601 of Regulation S-K:
EXHIBIT NUMBER DESCRIPTION - ------- ----------- 2.1 Sale and purchase agreement between Schwarz Pharma AG, Alpharma GmbH & Co. KG and Alpharma Inc. dated June 18, 1999 was filed as Exhibit 2.1 of the Company's Form 8-K dated as of July 2, 1999, and is incorporated by reference. 2.2 Agreement for the sale and purchase of the issued share capital of Cox Investments Limited, dated April 30, 1998 between Hoechst AG, Alpharma (U.K.) Limited, and Alpharma Inc. was filed as Exhibit 2.1 of the Company's Form 8-K, dated as of May 7, 1998 and is incorporated by reference. 4.1A Form of Indenture. 4.1B Form of Securities Resolution. 4.2 Reference is made to Article Fourth of the Amended and Restated Certificate of Incorporation of the Company which is filed as Exhibit 3.1 to the Company's 1998 Annual Report on Form 10-K and is incorporated by reference. 4.3 Indenture, dated as of March 30, 1998, by and among the Company and First Union National Bank, as trustee, with respect to the 5 3/4% Convertible Subordinated Notes due 2005 was filed as Exhibit 4.1 of the Company's Form 8-K dated as of March 30, 1998 and is incorporated by reference. 4.4 Note Purchase Agreement dated March 5, 1998 and Amendment No. I thereto dated March 25, 1998 by and between the Company and A.L. Industrier A.S. was filed as Exhibit 1.2 of the Company's Form 8-K dated as of March 30, 1998 and is incorporated by reference. 4.5 $300,000,000 Credit Agreement among Alpharma U.S. Inc., as Borrower, Union Bank of Norway, as agent and arranger, and Den norske Bank AS, as co-arranger, dated January 20, 1999 was filed as Exhibit 10.2 to the Company's 1998 Annual Report on Form 10-K and is incorporated by reference. 4.6 Parent Guaranty, made by the Company in favor of Union Bank of Norway, as agent and arranger, and Den norske Bank AS, as co-arranger, dated January 20, 1999, was filed as Exhibit 10.7 to the Company's 1998 Annual Report on Form 10-K and is incorporated by reference. 4.7 Indenture dated as of June 2, 1999, by and between the Registrant and First Union National Bank, as trustee, with respect to the 3% Convertible Senior Subordinated Notes due 2006, was filed as Exhibit 4.1 to the Company's Form 8-K dated as of June 16, 1999 and is incorporated by reference. 5.1 Opinion of Kirkland & Ellis regarding legality of securities being registered. 12.1 Statement re: computation of ratio of earnings to fixed charges. 23.1 Consent of PricewaterhouseCoopers, LLP. 23.2 Consent of Kirkland & Ellis (included in Exhibit 5.1). 24.1 Powers of Attorney (included signature pages of Registration Statement). 25.1 Statement of eligibility of Trustee, on Form T-1.
II-2 28 ITEM 17. UNDERTAKINGS. (a) 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, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement. (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 (a)(1)(i) and (a)(1)(ii) of this section do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be 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. (b) 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. (c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for II-3 29 indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. II-4 30 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, the Registrant certifies that it has reasonable grounds to believe it meets all the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Fort Lee, New Jersey, as of August 27, 1999. ALPHARMA INC. By: /s/ ROBERT F. WROBEL ------------------------------------ Robert F. Wrobel Vice President and Chief Legal Officer KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Jeffrey E. Smith and Robert F. Wrobel and each of them, as true and lawful attorneys-in-fact and agents with full power of substitution and resubstitution for him and in his name, place and stead, in any and all capacities to sign any and all amendments (including pre-effective and post-effective amendments) to this Registration Statement (and any registration statement filed pursuant to Rule 462(b) under the Securities Act), 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 to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby 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 of 1933, as amended, this Registration Statement has been signed by the following persons in the capacities and as of the dates indicated.
SIGNATURE TITLE DATE --------- ----- ---- /s/ EINAR W. SISSENER Chairman and Director August 27, 1999 - --------------------------------------------------- (Principal Executive Officer) Einar W. Sissener /s/ GERT W. MUNTHE President and Chief Executive August 27, 1999 - --------------------------------------------------- Officer and Director Gert W. Munthe /s/ JEFFREY E. SMITH Vice President, Finance and August 27, 1999 - --------------------------------------------------- Chief Financial Officer Jeffrey E. Smith (Principal Financial Officer and Principal Accounting Officer) /s/ I. ROY COHEN Director August 27, 1999 - --------------------------------------------------- I. Roy Cohen
II-5 31
SIGNATURE TITLE DATE --------- ----- ---- /s/ THOMAS GIBIAN Director August 27, 1999 - --------------------------------------------------- Thomas Gibian /s/ GLEN E. HESS Director August 27, 1999 - --------------------------------------------------- Glen E. Hess /s/ ERIK G. TANDBERG Director August 27, 1999 - --------------------------------------------------- Erik G. Tandberg /s/ PETER G. TOMBROS Director August 27, 1999 - --------------------------------------------------- Peter G. Tombros /s/ ERIK HORNNAESS Director August 27, 1999 - --------------------------------------------------- Erik Hornnaess /s/ OYVIN A. BROYMER Director August 27, 1999 - --------------------------------------------------- Oyvin A. Broymer
II-6 32 EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION - ------- ----------- 2.1 Sale and purchase agreement between Schwarz Pharma AG, Alpharma GmbH & Co. KG and Alpharma Inc. dated June 18, 1999 was filed as Exhibit 2.1 of the Company's Form 8-K dated as of July 2, 1999, and is incorporated by reference. 2.2 Agreement for the sale and purchase of the issued share capital of Cox Investments Limited, dated April 30, 1998 between Hoechst AG, Alpharma (U.K.) Limited, and Alpharma Inc. was filed as Exhibit 2.1 of the Company's Form 8-K, dated as of May 7, 1998 and is incorporated by reference. 4.1A Form of Indenture. 4.1B Form of Securities Resolution. 4.2 Reference is made to Article Fourth of the Amended and Restated Certificate of Incorporation of the Company which is filed as Exhibit 3.1 to the Company's 1998 Annual Report on Form 10-K and is incorporated by reference. 4.3 Indenture, dated as of March 30, 1998, by and among the Company and First Union National Bank, as trustee, with respect to the 5 3/4% Convertible Subordinated Notes due 2005 was filed as Exhibit 4.1 of the Company's Form 8-K dated as of March 30, 1998 and is incorporated by reference. 4.4 Note Purchase Agreement dated March 5, 1998 and Amendment No. I thereto dated March 25, 1998 by and between the Company and A.L. Industrier A.S. was filed as Exhibit 1.2 of the Company's Form 8-K dated as of March 30, 1998 and is incorporated by reference. 4.5 $300,000,000 Credit Agreement among Alpharma U.S. Inc., as Borrower, Union Bank of Norway, as agent and arranger, and Den norske Bank AS, as co-arranger, dated January 20, 1999 was filed as Exhibit 10.2 to the Company's 1998 Annual Report on Form 10-K and is incorporated by reference. 4.6 Parent Guaranty, made by the Company in favor of Union Bank of Norway, as agent and arranger, and Den norske Bank AS, as co-arranger, dated January 20, 1999, was filed as Exhibit 10.7 to the Company's 1998 Annual Report on Form 10-K and is incorporated by reference. 4.7 Indenture dated as of June 2, 1999, by and between the Registrant and First Union National Bank, as trustee, with respect to the 3% Convertible Senior Subordinated Notes due 2006, was filed as Exhibit 4.1 to the Company's Form 8-K dated as of June 16, 1999 and is incorporated by reference. 5.1 Opinion of Kirkland & Ellis regarding legality of securities being registered. 12.1 Statement re: computation of ratio of earnings to fixed charges. 23.1 Consent of PricewaterhouseCoopers, LLP. 23.2 Consent of Kirkland & Ellis (included in Exhibit 5.1). 24.1 Powers of Attorney (included signature pages of Registration Statement). 25.1 Statement of eligibility of Trustee, on Form T-1.
EX-4.1A 2 FORM OF INDENTURE 1 Exhibit 4.1A - -------------------------------------------------------------------------------- ALPHARMA INC. -------------------- DEBT SECURITIES INDENTURE -------------------- DATED AS OF , 199 [TRUSTEE] 2 PARTIAL CROSS-REFERENCE TABLE
INDENTURE SECTION TIA SECTION 2.05................................ 317(b) 2.06................................ 312(a) 2.11................................ 316(a) (last sentence) 4.05................................ 314(a)(4) 6.03................................ 317(a)(1) 6.04................................ 316(a)(1)(B) 6.06................................ 316(a)(1)(A) 6.07................................ 317(a)(1) 7.01................................ 315(a), 315(d) 7.04................................ 315(b) 7.05................................ 313(a) 7.07................................ 310(a), 310(b) 7.09................................ 310(a)(2) 8.02................................ 310(a), 310(b) 9.04................................ 316(c) 10.01............................... 318(a) 10.02............................... 313(c) 10.03............................... 314(c)(1), 314(c)(2) 10.04............................... 314(e)
-i- 3 TABLE OF CONTENTS
Page ---- ARTICLE 1 -- DEFINITIONS............................................ 1 SECTION 1.01. Definitions.......................................... 1 SECTION 1.02. Other Definitions.................................... 4 SECTION 1.03. Rules of Construction................................ 4 ARTICLE 2 -- THE SECURITIES......................................... 5 SECTION 2.01. Issuable in Series................................... 5 SECTION 2.02. Execution and Authentication......................... 7 SECTION 2.03. Agents............................................... 8 SECTION 2.04. Bearer Securities.................................... 8 SECTION 2.05. Paying Agent to Hold Money in Trust.................. 9 SECTION 2.06. Securityholder Lists................................. 9 SECTION 2.07. Transfer and Exchange................................ 10 SECTION 2.08. Replacement Securities............................... 11 SECTION 2.09. Outstanding Securities............................... 11 SECTION 2.10. Discounted Debt Securities........................... 11 SECTION 2.11. Treasury Securities.................................. 12 SECTION 2.12. Global Securities.................................... 12 SECTION 2.13. Temporary Securities................................. 13 SECTION 2.14. Cancellation......................................... 13 SECTION 2.15. Defaulted Interest................................... 13 ARTICLE 3 -- REDEMPTION............................................. 14 SECTION 3.01. Notices to Trustee................................... 14 SECTION 3.02. Selection of Securities to Be Redeemed............... 14 SECTION 3.03. Notice of Redemption................................. 14 SECTION 3.04. Effect of Notice of Redemption....................... 15 SECTION 3.05. Payment of Redemption Price.......................... 16 SECTION 3.06. Securities Redeemed in Part.......................... 16 ARTICLE 4 -- COVENANTS.............................................. 17 SECTION 4.01. Payment of Securities................................ 17
-ii- 4
Page ---- SECTION 4.02. Overdue Interest..................................... 17 SECTION 4.03. Compliance Certificate............................... 17 SECTION 4.04. SEC Reports.......................................... 17 ARTICLE 5 -- SUCCESSORS............................................. 18 SECTION 5.01. When Company May Merge, etc.......................... 18 ARTICLE 6 -- DEFAULTS AND REMEDIES.................................. 18 SECTION 6.01. Events of Default.................................... 18 SECTION 6.02. Acceleration......................................... 20 SECTION 6.03. Other Remedies....................................... 20 SECTION 6.04. Waiver of Past Defaults.............................. 21 SECTION 6.05. Control by Majority.................................. 21 SECTION 6.06. Limitation on Suits.................................. 21 SECTION 6.07. Collection Suit by Trustee........................... 22 SECTION 6.08. Priorities........................................... 22 ARTICLE 7 -- TRUSTEE................................................ 23 Section 7.01. Certain Duties and Responsibilities.................. 23 SECTION 7.02. Rights of Trustee.................................... 23 SECTION 7.03. Individual Rights of Trustee......................... 24 SECTION 7.04. Trustee's Disclaimer................................. 25 SECTION 7.05. Notice of Defaults................................... 25 SECTION 7.06. Reports by Trustee to Holders........................ 25 SECTION 7.07. Compensation and Indemnity........................... 25 SECTION 7.08. Replacement of Trustee............................... 26 SECTION 7.09. Successor Trustee by Merger, etc..................... 27 SECTION 7.10. Trustee's Capital and Surplus........................ 27 ARTICLE 8 -- DISCHARGE OF INDENTURE................................. 28 SECTION 8.01. Defeasance........................................... 28 SECTION 8.02. Conditions to Defeasance............................. 28 SECTION 8.03. Application of Trust Money........................... 30 SECTION 8.04. Repayment to Company................................. 30
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Page ---- ARTICLE 9 -- AMENDMENTS............................................. 30 SECTION 9.01. Without Consent of Holders........................... 30 SECTION 9.02. With Consent of Holders.............................. 31 SECTION 9.03. Compliance with Trust Indenture Act.................. 32 SECTION 9.04. Effect of Consents................................... 32 SECTION 9.05. Notation on or Exchange of Securities................ 32 SECTION 9.06. Trustee Protected.................................... 32 ARTICLE 10 -- MISCELLANEOUS......................................... 33 SECTION 10.01. Trust Indenture Act................................. 33 SECTION 10.02. Notices............................................. 33 SECTION 10.03. Certificate and Opinion as to Conditions Precedent.. 34 SECTION 10.04. Statements Required in Certificate or Opinion....... 35 SECTION 10.05. Rules by Company and Agents......................... 35 SECTION 10.06. No Lien Created, etc................................ 35 SECTION 10.07. Legal Holidays...................................... 35 SECTION 10.08. No Recourse Against Others.......................... 36 SECTION 10.09. Duplicate Originals................................. 36 SECTION 10.10. Governing Law....................................... 36
-iv- 6 INDENTURE dated as of , 1999 between ALPHARMA INC., a corporation organized and existing under the laws of the State of Delaware (hereinafter called the "Company"), and [TRUSTEE] as Trustee ("Trustee"). Each party agrees as follows for the benefit of the Holders of the Company's debt securities issued under this Indenture: ARTICLE 1 -- DEFINITIONS SECTION 1.01. Definitions. "AFFILIATE" means any person directly or indirectly controlling or controlled by or under direct or indirect common control with the Company. "AGENT" means any Registrar or Paying Agent. "AUTHORIZED NEWSPAPER" means a newspaper that is: (1) printed in the English language or in an official language of the country of publication; (2) customarily published on each business day in the place of publication; and (3) of general circulation in the relevant place or in the financial community of such place. Whenever successive publications in an Authorized Newspaper are required, they may be made on the same or different business days and in the same or different Authorized Newspapers. "BEARER SECURITY" means a Security payable to bearer. "BOARD" means the Board of Directors of the Company or any authorized committee of the Board. "CAPITAL STOCK" means any and all shares, interests, participations or other equivalents (however designated) of capital stock of any person and all warrants or options to acquire such capital stock. 7 -2- "COMPANY" means the party named as such above until a successor replaces it and thereafter means the successor. "CORPORATE TRUST OFFICE" shall mean an office of the Trustee at which at any particular time its corporate trust business shall be administered, which office at the date of the execution of this Indenture is located at [TRUSTEE'S ADDRESS], or at any other time at such other address as the Trustee may designate from time to time by notice to the Holders. "COUPON" means an interest coupon for a Bearer Security. "DEFAULT" means any event which is, or after notice or passage of time would be, an Event of Default (as defined below). "DISCOUNTED DEBT SECURITY" means a Security where the amount of principal due upon acceleration is less than the stated principal amount. "HOLDER" or "SECURITYHOLDER" means the person in whose name a Registered Security is registered and the bearer of a Bearer Security or coupon. "INDENTURE" means this Indenture and any Securities Resolution as amended from time to time. "LIEN" means mortgage, pledge, security interest or other lien. "OFFICER" means the Chairman, any Vice-Chairman, the President, any Executive or Senior Vice President, any Vice-President, the Treasurer or any Assistant Treasurer, the Secretary or any Assistant Secretary of the Company. "OFFICERS' CERTIFICATE" means a certificate signed by two Officers of the Company, and delivered to the Trustee. "OPINION OF COUNSEL" means a written opinion from legal counsel who is acceptable to the Trustee, and delivered to the Trustee. The counsel may be an employee of or counsel to the Company. "PERSON" means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, 8 -3- unincorporated organization or government or any agency or political subdivision thereof. "PRINCIPAL" of a debt security means the principal of the security plus the premium, if and when applicable, on the security. "REGISTERED SECURITY" means a Security registered as to principal and interest by the Registrar. "SEC" means the Securities and Exchange Commission. "SECURITIES" means the debt securities issued under this Indenture. "SECURITIES RESOLUTION" means a resolution authorizing a series adopted by the Board or by a committee of Officers or an Officer pursuant to Board delegation. "SERIES" means a series of Securities or the Securities of the series. "SUBSIDIARY" of any person means (i) a corporation more than 50% of the outstanding voting stock of which is owned, directly or indirectly, by such person or by one or more other Subsidiaries of such person or by such person and one or more Subsidiaries thereof or (ii) any other person (other than a corporation) in which such person, or one or more Subsidiaries of such person or such person and one or more Subsidiaries thereof, directly or indirectly, has at least a majority ownership and power to direct the policy, management and affairs thereof. "TIA" means the Trust Indenture Act of 1939 (15 U.S. Code Section 77aaa-77bbbb), as amended. "TRADING DAY" means each day on which the securities exchange or quotation system which is used to determine the Market Price is open for trading or quotation. "TRUSTEE" means the party named as such above until a successor replaces it and thereafter means the successor. "TRUST OFFICER" when used with respect to the Trustee, means any officer assigned to the Corporate Trust Office, having direct responsibility for the administration of this In- 9 -4- denture, and also, with respect to a particular matter, any other officer, to whom such matter is referred because of such officer's knowledge of and familiarity with the particular subject. "UNITED STATES" means the United States of America, its territories and possessions and other areas subject to its jurisdiction. SECTION 1.02. Other Definitions.
TERM DEFINED IN SECTION "ACTUAL KNOWLEDGE" 7.01 "BANKRUPTCY LAW" 6.01 "CONDITIONAL REDEMPTION" 3.04 "CUSTODIAN" 6.01 "LEGAL HOLIDAY" 10.06 "PAYING AGENT" 2.03 "REGISTRAR" 2.03 "TREASURY REGULATIONS" 2.04 "U.S. GOVERNMENT OBLIGATIONS" 8.02
SECTION 1.03. Rules of Construction. Unless the context otherwise requires: (1) a term has the meaning assigned to it; (2) an accounting term not otherwise defined has the meaning assigned to it in accordance with generally accepted accounting principles in the United States; (3) generally accepted accounting principles are those applicable from time to time; (4) all terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by SEC rule under the TIA have the meanings assigned to them by such definitions; (5) "OR" is not exclusive; and 10 -5- (6) words in the singular include the plural, and in the plural include the singular. ARTICLE 2 -- THE SECURITIES SECTION 2.01. Issuable in Series. The aggregate principal amount of Securities that may be issued under this Indenture is unlimited. The Securities may be issued from time to time in one or more series. Each series shall be created by a Securities Resolution that establishes the terms of the series, which may include the following: (1) the title of the series; (2) the aggregate principal amount of the series; (3) the interest rate, if any, or method of calculating the interest rate; (4) the date from which interest will accrue; (5) the record dates for interest payable on Registered Securities; (6) the dates when principal and interest are payable; (7) the manner of paying principal and interest; (8) the places where principal and interest are payable; (9) the Registrar and Paying Agent; (10) the terms of any mandatory or optional redemption by the Company or any third party including any sinking fund; (11) the terms of any redemption at the option of Holders or put by the Holders; (12) the denominations in which Securities are issuable; 11 -6- (13) whether Securities will be issuable as Registered Securities, Bearer Securities or uncertificated Securities; (14) whether and upon what terms Registered Securities, Bearer Securities and uncertificated Securities may be exchanged; (15) whether any Securities will be represented by a Security in global form; (16) the terms of any global Security; (17) the terms of any tax indemnity; (18) the currencies (including any composite currency) in which principal or interest may be paid; (19) if payments of principal or interest may be made in a currency other than that in which Securities are denominated, the manner for determining such payments; (20) if amounts of principal or interest may be determined by reference to an index, formula or other method, the manner for determining such amounts; (21) provisions for electronic issuance of Securities or for Securities in uncertificated form; (22) the portion of principal payable upon acceleration of a Discounted Debt Security; (23) whether any Events of Default or covenants in addition to or in lieu of those set forth in this Indenture have been added; (24) whether and upon what terms Securities may be defeased; (25) the forms of the Securities or any coupon, which may be in the form of Exhibit A or B; (26) any terms that may be required by or advisable under U.S. laws; and 12 -7- (27) any other terms not inconsistent with this Indenture. All Securities of one series need not be issued at the same time and, unless otherwise provided, a series may be reopened for issuances of additional Securities of such series. The creation and issuance of a series and the authentication and delivery thereof are not subject to any conditions precedent. SECTION 2.02. Execution and Authentication. Two Officers shall sign the Securities by manual or facsimile signature. The Company's seal shall be reproduced on the Securities. An Officer shall sign any coupons by facsimile signature. If an Officer whose signature is on a Security or its coupons no longer holds that office at the time the Security is authenticated or delivered, the Security and coupons shall nevertheless be valid. A Security and its coupons shall not be valid until the Security is authenticated by the manual signature of the Trustee. The signature shall be conclusive evidence that the Security has been authenticated under this Indenture. Each Registered Security shall be dated the date of its authentication. Each Bearer Security shall be dated the date of its original issuance or as provided in the Securities Resolution. Securities may have notations, legends or endorsements required by law, stock exchange rule, agreement or usage. In the event Securities are issued in electronic or other uncertificated form, such Securities may be validly issued without the signatures or seal contemplated by this Section 2.02. The Trustee may appoint an authenticating agent acceptable to the Company to authenticate Securities. An authenticating agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with the Company or an Affiliate. 13 -8- SECTION 2.03. Agents. The Company shall maintain an office or agency where Securities may be presented for registration of transfer or for exchange ("Registrar") and an office or agency where Securities may be presented for payment ("Paying Agent"). The Registrar shall keep a register of the Securities and of their transfer and exchange. The Company may appoint more than one Registrar or Paying Agent for a series. The Company shall notify the Trustee of the name and address of any Agent not a party to this Indenture. If the Company does not appoint or maintain a Registrar or Paying Agent for a series, the Trustee shall act as such. SECTION 2.04. Bearer Securities. U.S. laws and Treasury Regulations restrict sales or exchanges of and payments on Bearer Securities. Therefore, except as provided below: (1) Bearer Securities will be offered, sold or delivered only outside the United States and will be delivered in connection with its original issuance only upon presentation of a certificate in a form prescribed by the Company to comply with U.S. laws and regulations. (2) Bearer Securities will not be issued in exchange for Registered Securities. (3) All payments of principal and interest (including original issue discount) on Bearer Securities will be made outside the United States by a Paying Agent located outside the United States unless the Company determines that: (A) such payments may not be made by such Paying Agent because the payments are illegal or prevented by exchange controls as described in Treasury Regulation Section 1.163-5(c)(2)(v); and (B) making the payments in the United States would not have an adverse tax effect on the Company. 14 -9- If there is a change in the relevant provisions of U.S. laws or Treasury Regulations or the judicial or administrative interpretation thereof, a restriction set forth in paragraph (1), (2) or (3) above will not apply to a series if the Company determines that the relevant provisions no longer apply to the series or that failure to comply with the relevant provisions would not have an adverse tax effect on the Company or on Securityholders or cause the series to be treated as "registration-required" obligations under U.S. law. The Company shall notify the Trustee of any determinations by the Company under this Section. "TREASURY REGULATIONS" means regulations of the U.S. Treasury Department under the Internal Revenue Code of 1986, as amended. SECTION 2.05. Paying Agent to Hold Money in Trust. The Company shall require each Paying Agent for a series other than the Trustee to agree in writing that the Paying Agent will hold in trust for the benefit of the persons entitled thereto all money held by the Paying Agent for the payment of principal of or interest on the series, and will notify the Trustee of any default by the Company in making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all money so held by it to the Trustee. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent shall have no further liability for the money. If the Company or an Affiliate acts as Paying Agent for a series, it shall segregate and hold as a separate trust fund all money held by it as Paying Agent for the series. SECTION 2.06. Securityholder Lists. The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Securityholders. If the Trustee is not the Registrar, the Company shall furnish to the Trustee semiannually and at such other times as the Trustee may request a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Holders of Regis- 15 -10- tered Securities and Holders of Bearer Securities whose names are on the list referred to below. The Registrar shall keep a list of the names and addresses of Holders of Bearer Securities who file a request to be included on such list. A request will remain in effect for two years, and successive requests may be made. Whenever the Company or the Trustee is required to mail a notice to all Holders of Registered Securities of a series, it also shall mail the notice to Holders of Bearer Securities of the series whose names are on the list. Whenever the Company is required to publish a notice to all Holders of Bearer Securities of a series, it also shall mail the notice to such of them whose names are on the list. SECTION 2.07. Transfer and Exchange. Where Registered Securities of a series are presented to the Registrar with a request to register a transfer or to exchange them for an equal principal amount of Registered Securities of other denominations of the same series, the Registrar shall register the transfer or make the exchange if its requirements for such transactions are met. To permit registrations of transfer and exchanges, the Trustee shall authenticate Registered Securities and Bearer Securities at the Registrar's written request. The Registrar may require a Holder to pay a sum sufficient to cover any taxes imposed on a transfer or exchange. If a series provides for Registered and Bearer Securities and for their exchange, Bearer Securities may be exchanged for Registered Securities and Registered Securities may be exchanged for Bearer Securities as provided in the Securities or the Securities Resolution if the requirements of the Registrar for such transactions are met and in the case of the exchange of registered securities for bearer securities if Section 2.04 permits the exchange. The Company may elect not to exchange or register the transfer of any Security for a period of 15 days before a selection of Securities to be redeemed. 16 -11- SECTION 2.08. Replacement Securities. If the Holder of a Security or coupon claims that it has been lost, destroyed or wrongfully taken, then, in the absence of notice to the Company or the Trustee that the Security or coupon has been acquired by a protected purchaser, the Company shall issue a replacement Security or coupon if the Company and the Trustee receive: (1) evidence satisfactory to them of the loss, destruction or taking; (2) an indemnity bond satisfactory to them; and (3) payment of a sum sufficient to cover their expenses and any taxes for replacing the Security or coupon. A replacement Security shall have coupons attached corresponding to those, if any, on the replaced Security. Every replacement Security or coupon is an additional obligation of the Company. SECTION 2.09. Outstanding Securities. The Securities outstanding at any time are all the Securities authenticated by the Trustee except for those cancelled by it, those delivered to it for cancellation, and those described in this Section as not outstanding. If a Security is replaced pursuant to Section 2.08, it ceases to be outstanding unless the Trustee and the Company receive proof satisfactory to them that the replaced Security is held by a protected purchaser. If Securities are considered paid under Section 4.01, they cease to be outstanding and interest on them ceases to accrue. A Security does not cease to be outstanding because the Company or an Affiliate holds the Security. SECTION 2.10. Discounted Debt Securities. In determining whether the Holders of the required principal amount of Securities have concurred in any direction, waiver or consent, the principal amount of a Discounted Debt 17 -12- Security shall be the amount of principal that would be due as of the date of such determination if payment of the Security were accelerated on that date. SECTION 2.11. Treasury Securities. In determining whether the Holders of the required principal amount of Securities have concurred in any direction, waiver or consent, Securities owned by the Company or an Affiliate shall be disregarded, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Securities which the Trustee actually knows are so owned shall be so disregarded. SECTION 2.12. Global Securities. If the Securities Resolution so provides, the Company may issue some or all of the Securities of a series in temporary or permanent global form. A global Security may be in registered form, in bearer form with or without coupons or in uncertificated form. A global Security shall represent that amount of Securities of a series as specified in the global Security or as endorsed thereon from time to time. At the Company's request, the Trustee shall endorse a global Security to reflect the amount of any increase or decrease in the Securities represented thereby. The Company may issue a global Security only to a depository designated by the Company. A depository may transfer a global Security only as a whole to its nominee or to a successor depository. The Securities Resolution may establish, among other things, the manner of paying principal and interest on a global Security and whether and upon what terms a beneficial owner of an interest in a global Security may exchange such interest for definitive Securities. The Company, an Affiliate, the Trustee and any Agent shall not be responsible for any acts or omissions of a depository, for any depository records of beneficial ownership interests or for any transactions between the depository and beneficial owners. 18 -13- SECTION 2.13. Temporary Securities. Until definitive Securities of a series are ready for delivery, the Company may use temporary Securities. Temporary Securities shall be substantially in the form of definitive Securities but may have variations that the Company considers appropriate for temporary Securities. Temporary Securities may be in global form. Temporary Bearer Securities may have one or more coupons or no coupons. Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate definitive Securities in exchange for temporary Securities. SECTION 2.14. Cancellation. The Company at any time may deliver Securities to the Trustee for cancellation. The Registrar and the Paying Agent shall forward to the Trustee any Securities and coupons surrendered to them for payment, exchange or registration of transfer. The Trustee shall cancel all Securities or coupons surrendered for payment, registration of transfer, exchange or cancellation. The Trustee also will cancel all Bearer Securities and unmatured coupons unless the Company requests the Trustee to hold the same for redelivery. Any Bearer Securities so held shall be considered delivered for cancellation under Section 2.09. The Trustee shall dispose of cancelled Securities and coupons in accordance with its record retention policies in effect at the time or shall deliver them to the Company upon the written request of the Company. Unless the Securities Resolution otherwise provides, the Company may not issue new Securities to replace Securities that the Company has paid or that the Company has delivered to the Trustee for cancellation. SECTION 2.15. Defaulted Interest. If the Company defaults in a payment of interest on Registered Securities, it need not pay the defaulted interest to Holders on the regular record date. The Company may fix a special record date for determining Holders entitled to receive defaulted interest, or the Company may pay defaulted interest in any other lawful manner. At least ___ days before the special record date, the Company shall give the Holders of Registered Securities a notice that states the record date, payment date and amount of interest to be paid. 19 -14- ARTICLE 3 -- REDEMPTION SECTION 3.01. Notices to Trustee. Securities of a series that are redeemable before maturity shall be redeemable in accordance with their terms and, unless the Securities Resolution otherwise provides, in accordance with this Article. In the case of a redemption by the Company, the Company shall notify the Trustee of the redemption date and the principal amount of Securities to be redeemed. The Company shall notify the Trustee at least 45 days before the redemption date unless a shorter notice is satisfactory to the Trustee. If the Company is required to redeem Securities, it may reduce the principal amount of Securities required to be redeemed to the extent that it is permitted a credit against such redemption requirement by the terms of the Securities Resolution and notifies the Trustee of the amount of such credit and the basis for it. If the reduction is based on a credit for acquired or redeemed Securities that the Company has not previously delivered to the Trustee for cancellation, the Company shall deliver the Securities at the same time as the notice. SECTION 3.02. Selection of Securities to Be Redeemed. If less than all the Securities of a series are to be redeemed, the Trustee shall select the Securities to be redeemed from Securities outstanding not previously called for redemption by a method the Trustee considers fair and appropriate. The Trustee shall make the selection from Securities of the series outstanding not previously called for redemption. The Trustee may select for redemption portions of the principal of Securities having denominations larger than the minimum denomination for the series. Securities and portions thereof selected for redemption shall be in amounts equal to the minimum denomination for the series or an integral multiple thereof. Provisions of this Indenture that apply to Securities called for redemption also apply to portions of Securities called for redemption. SECTION 3.03. Notice of Redemption. At least 30 days before a redemption date, the Company shall mail a notice of redemption by first-class mail to 20 -15- each Holder of Registered Securities whose Securities are to be redeemed. If Bearer Securities are to be redeemed, the Company shall publish a notice of redemption in an Authorized Newspaper as provided in the Securities. A notice shall identify the Securities of the series to be redeemed and shall state: (1) the redemption date; (2) the redemption price; (3) the name and address of the Paying Agent; (4) that Securities called for redemption, together with all coupons, if any, maturing after the redemption date, must be surrendered to the Paying Agent to collect the redemption price; (5) that interest on Securities called for redemption ceases to accrue on and after the redemption date; (6) whether the redemption by the Company is mandatory or optional; and (7) whether the redemption is conditional as provided in Section 3.04, and if so, the terms of the conditions, and that, if the conditions are not satisfied or are not waived by the Company, the Securities will not be redeemed and such a failure to redeem will not constitute an Event of Default. A redemption notice given by publication need not identify Registered Securities to be redeemed. At the Company's request, the Trustee shall give the notice of redemption in the Company's name and at its expense. SECTION 3.04. Effect of Notice of Redemption. Except as provided below, once notice of redemption is given, Securities called for redemption become due and payable on the redemption date at the redemption price stated in the notice. 21 -16- A notice of redemption may provide that it is subject to the occurrence of any event before the date fixed for such redemption as described in such notice ("Conditional Redemption"), and such notice of Conditional Redemption shall be of no effect unless all such conditions to the redemption have occurred on or before such date or have been waived by the Company in its sole discretion. SECTION 3.05. Payment of Redemption Price. On or before the redemption date, the Company shall deposit with the Paying Agent money sufficient to pay the redemption price of and accrued interest on all Securities to be redeemed on that date. When the Holder of a Security surrenders it for redemption in accordance with the redemption notice, the Company shall pay to the Holder on the redemption date the redemption price and accrued interest to such date, except that: (1) the Company will pay any such interest (except defaulted interest) to Holders on the record date of Registered Securities if the redemption date occurs on an interest payment date; and (2) the Company will pay any such interest to Holders of coupons that mature on or before the redemption date upon surrender of such coupons to the Paying Agent. Coupons maturing after the redemption date on a called Security are void absent a payment default on that date. Nevertheless, if a Holder surrenders for redemption a Bearer Security missing any such coupons, the Company may deduct the face amount of such coupons from the redemption price. If thereafter the Holder surrenders to the Paying Agent the missing coupons, the Company will return the amount so deducted. The Company may waive surrender of the missing coupons if it receives an indemnity bond satisfactory to the Company. SECTION 3.06. Securities Redeemed in Part. Upon surrender of a Security that is redeemed in part, the Trustee shall authenticate for the Holder and the Company shall deliver to the Holder a new Security of the same series equal in principal amount to the unredeemed portion of the Security surrendered. 22 -17- ARTICLE 4 -- COVENANTS SECTION 4.01. Payment of Securities. The Company shall pay the principal of and interest on a series in accordance with the terms of the Securities for the series, any related coupons, and this Indenture. Principal and interest on a series shall be considered paid on the date due if the Paying Agent for the series holds on that date money sufficient to pay all principal and interest then due on the series. SECTION 4.02. Overdue Interest. Unless the Securities Resolution otherwise provides, the Company shall pay interest on overdue principal of a Security of a series at the rate (or yield to maturity in the case of a Discounted Debt Security) borne by the series; the Company shall pay interest on overdue installments of interest at the same rate or yield to maturity to the extent lawful. SECTION 4.03. Compliance Certificate. The Company shall deliver to the Trustee, within 120 days after the end of each fiscal year of the Company, a brief certificate signed by the principal executive officer, principal financial officer or principal accounting officer of the Company, as to the signer's knowledge of the Company's compliance with all conditions and covenants under this Indenture (determined without regard to any period of grace or requirement of notice provided herein). Any other obligor on the Securities shall also deliver to the Trustee such a certificate as to its compliance with this Indenture within 120 days after the end of each of its fiscal years. The certificates need not comply with Section 10.04. SECTION 4.04. SEC Reports. The Company shall file with the Trustee, within 15 days after the Company is required to file the same with the SEC, copies of the annual reports and of the information, documents, and other reports (or such portions of the foregoing as the SEC may prescribe) which the Company is required to file 23 -18- with the SEC pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. Any other obligor on the Securities shall do likewise as to the above items which it is required to file with the SEC pursuant to those sections. ARTICLE 5 -- SUCCESSORS SECTION 5.01. When Company May Merge, etc. Unless the Securities Resolution establishing a series otherwise provides with respect to that series, the Company shall not consolidate with or merge into, or transfer all or substantially all of its assets to, any person in any transaction in which the Company is not the survivor unless: (1) the person is organized under the laws of the United States or a State thereof or is organized under the laws of a foreign jurisdiction and consents to the jurisdiction of the courts of the United States or a State thereof; (2) the person assumes by supplemental indenture all the obligations of the Company under this Indenture, the Securities and any coupons; and (3) immediately after the transaction no Default exists. The successor shall be substituted for the Company, and thereafter all obligations of the Company under this Indenture, the Securities and any coupons shall terminate. ARTICLE 6 -- DEFAULTS AND REMEDIES SECTION 6.01. Events of Default. Unless the Securities Resolution otherwise provides, an "EVENT OF DEFAULT" on a series occurs if: (1) the Company defaults in any payment of interest on any Securities of the series when the same 24 -19- becomes due and payable and the Default continues for a period of 60 days; (2) the Company defaults in the payment of the principal and premium, if any, of any Securities of the series when the same becomes due and payable at maturity or upon redemption, acceleration or otherwise, and such default shall continue for five or more days; (3) the Company defaults in the payment or satisfaction of any sinking fund obligation with respect to any Securities of the series as required by the Securities Resolution establishing such series and the Default continues for a period of 60 days; (4) the Company defaults in the performance of any of its other agreements applicable to the series and the Default continues for 90 days after the notice specified below; (5) the Company pursuant to or within the meaning of any Bankruptcy Law: (A) commences a voluntary case, (B) consents to the entry of an order for relief against it in an involuntary case, (C) consents to the appointment of a Custodian for it or for all or substantially all of its property, or (D) makes a general assignment for the benefit of its creditors; (6) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that: (A) is for relief against the Company in an involuntary case, (B) appoints a Custodian for the Company or for all or substantially all of its property, or (C) orders the liquidation of the Company; 25 -20- and the order or decree remains unstayed and in effect for 60 days; or (7) there occurs any other Event of Default provided for in the series. The term "BANKRUPTCY LAW" means Title 11, U.S. Code or any similar Federal or State law for the relief of debtors. The term "CUSTODIAN" means any receiver, trustee, assignee, liquidator or a similar official under any Bankruptcy Law. A Default under clause (4) is not an Event of Default until the Trustee or the Holders of at least 33-1/3% in principal amount of the series notify the Company of the Default and the Company does not cure the Default within the time specified after receipt of the notice. The notice must specify the Default, demand that it be remedied and state that the notice is a "Notice of Default." If Holders notify the Company of a Default, they shall notify the Trustee at the same time. The failure to redeem any Security subject to a Conditional Redemption is not an Event of Default if any event on which such redemption is so conditioned does not occur and is not waived before the scheduled redemption date. SECTION 6.02. Acceleration. If an Event of Default occurs and is continuing on a series, the Trustee by notice to the Company, or the Holders of at least 33-1/3% in principal amount of the series by notice to the Company and the Trustee, may declare the principal of and accrued interest on all the Securities of the series to be due and payable immediately. Discounted Debt Securities may provide that the amount of principal due upon acceleration is less than the stated principal amount. The Holders of a majority in principal amount of the series by notice to the Trustee may rescind an acceleration and its consequences if the rescission would not conflict with any judgment or decree and if all existing Events of Default on the series have been cured or waived except nonpayment of principal or interest that has become due solely because of the acceleration. SECTION 6.03. Other Remedies. If an Event of Default occurs and is continuing on a series, the Trustee may pursue any available remedy to collect 26 -21- principal or interest then due on the series, to enforce the performance of any provision applicable to the series, or otherwise to protect the rights of the Trustee and Holders of the series. The Trustee may maintain a proceeding even if it does not possess any of the Securities or coupons or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Securityholder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law. SECTION 6.04. Waiver of Past Defaults. Unless the Securities Resolution otherwise provides, the Holders of a majority in principal amount of a series by notice to the Trustee may waive an existing Default on the series and its consequences except: (1) a Default in the payment of the principal of or interest on the series, or (2) a Default in respect of a provision that under Section 9.02 cannot be amended without the consent of each Securityholder affected. SECTION 6.05. Control by Majority. The Holders of a majority in principal amount of a series may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or of exercising any trust or power conferred on the Trustee, with respect to the series. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture, is unduly prejudicial to the rights of other Securityholders or if the Trustee shall determine that the action or direction might involve the Trustee in personal liability. SECTION 6.06. Limitation on Suits. A Securityholder of a series may pursue a remedy with respect to the series only if: (1) the Holder gives to the Trustee notice of a continuing Event of Default on the series; 27 -22- (2) the Holders of at least 33-1/3% in principal amount of the series make a request to the Trustee to pursue the remedy; (3) such Holder or Holders offer to the Trustee indemnity satisfactory to the Trustee against any loss, liability or expense; (4) the Trustee does not comply with the request within 60 days after receipt of the request and the offer of indemnity; and (5) during such 60-day period the Holders of a majority in principal amount of the series do not give the Trustee a direction inconsistent with such request. A Securityholder may not use this Indenture to prejudice the rights of another Securityholder or to obtain a preference or priority over another Securityholder. SECTION 6.07. Collection Suit by Trustee. If an Event of Default in payment of interest, principal or sinking fund specified in Section 6.01(1), (2) or (3) occurs and is continuing on a series, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company for the whole amount of principal and interest remaining unpaid on the series. SECTION 6.08. Priorities. If the Trustee collects any money for a series pursuant to this Article, it shall pay out the money in the following order: First: to the Trustee for amounts due under Section 7.06; Second: to Securityholders of the series for amounts due and unpaid for principal and interest, ratably, without preference or priority of any kind, according to the amounts due and payable for principal and interest, respectively; and Third: to the Company. 28 -23- The Trustee may fix a payment date for any payment to Securityholders. ARTICLE 7 -- TRUSTEE Section 7.01. Certain Duties and Responsibilities. The duties and responsibilities of the Trustee shall be as provided by the Trust Indenture Act. Notwithstanding the foregoing, no provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affect the liability of or affording protection to the Trustee shall be subject to the provisions of this Section. SECTION 7.02. Rights of Trustee. (1) The Trustee may rely on any document believed by it to be genuine and to have been signed or presented by the proper person. The Trustee need not investigate any fact or matter stated in the document. (2) Before the Trustee acts or refrains from acting, it may require an Officers' Certificate and/or an Opinion of Counsel. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on the Certificate or Opinion. (3) The Trustee may act through agents, attorneys, custodians and nominees and shall not be responsible for the misconduct or negligence of any agent, attorney, custodian or nominee appointed with due care. (4) The Trustee shall not be liable for any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05. 29 -24- (5) The Trustee may refuse to perform any duty or exercise any right or power which it reasonably believes may expose it to any loss, liability or expense unless it receives indemnity satisfactory to it against such loss, liability or expense. (6) The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law. (7) The Trustee shall have no duty with respect to a Default unless it has actual knowledge of the Default. As used herein, the term "actual knowledge" means the actual fact or statement of knowing, without any duty to make any investigation with regard thereto. (8) The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized and within its powers. (9) Any Agent shall have the same rights and be protected to the same extent as if it were Trustee. (10) The Trustee shall not be required to give any bond or surety in respect of the performance of its powers and duties hereunder. (11) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders pursuant to this Indenture, unless such Holders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction; SECTION 7.03. Individual Rights of Trustee. The Trustee in its individual or any other capacity may become the owner or pledgee of Securities or coupons and may otherwise deal with the Company or an Affiliate with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights. 30 -25- SECTION 7.01. Trustee's Disclaimer. The Trustee makes no representation as to the validity or adequacy of this Indenture or the Securities or any coupons; it shall not be accountable for the Company's use of the proceeds from the Securities; it shall not be responsible for any statement in the Securities or any coupons other than its authentication. SECTION 7.05. Notice of Defaults. If a Default occurs and is continuing on a series and if the Trustee has actual knowledge of such Default, the Trustee shall mail a notice of the Default within 90 days after it occurs to Holders of Registered Securities of the series. Except in the case of a Default in payment on a series, the Trustee may withhold the notice if and so long as a committee of its Trust Officers in good faith determines that withholding the notice is in the interest of Holders of the series. The Trustee shall withhold notice of a Default described in Section 6.01(4) until at least 90 days after it occurs. SECTION 7.02. Reports by Trustee to Holders. Any report required by TIA Section 313(a) to be mailed to Securityholders shall be mailed by the Trustee on or before July 15 of each year. A copy of each report at the time of its mailing to Securityholders shall be filed with the SEC and each stock exchange on which any Securities are listed. The Company shall notify the Trustee when any Securities are listed on a stock exchange. SECTION 7.07. Compensation and Indemnity. The Company shall pay to the Trustee from time to time reasonable compensation for its services. The Trustee's compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee upon request for all reasonable out-of-pocket expenses incurred by it. Such expenses shall include the reasonable compensation and expenses of the Trustee's agents and counsel. The Company shall indemnify the Trustee and hold it harmless against any loss or liability incurred by it in connection with the acceptance or administration of the trust or trusts hereunder. The Trustee shall notify the Company 31 -26- promptly of any claim for which it may seek indemnity. The Company shall defend the claim and the Trustee shall cooperate in the defense. The Trustee may have separate counsel and the Company shall pay the reasonable fees and expenses of such counsel. The Company need not pay for any settlement made without its consent. The Company need not reimburse any expense or indemnify against any loss or liability incurred by the Trustee through negligence or willful misconduct. To secure the Company's payment obligations in this Section, the Trustee shall have a lien prior to the Securities and any coupons on all money or property held or collected by the Trustee, except that held in trust to pay principal or interest on particular securities. When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(5) or (6) occurs, such expenses and the compensation for such services are intended to constitute expenses of administration under any Bankruptcy Law. The provisions of this Section shall survive any termination or discharge of this Indenture (including without limitation any termination under any Bankruptcy Law) and the resignation or removal of the Trustee. SECTION 7.08. Replacement of Trustee. A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee's acceptance of appointment as provided in this Section. The Trustee may resign by so notifying the Company. The Holders of a majority in principal amount of the Securities may remove the Trustee by so notifying the Trustee and may appoint a successor Trustee with the Company's consent. The Company may remove the Trustee if: (1) the Trustee fails to comply with TIA Section 310(a) or Section 310(b) or with Section 7.09; (2) the Trustee is adjudged a bankrupt or an insolvent; 32 -27- (3) a Custodian or other public officer takes charge of the Trustee or its property; (4) the Trustee becomes incapable of acting; or (5) an event of the kind described in Section 6.01(5) or (6) occurs with respect to the Trustee. If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall promptly appoint a successor Trustee. If a successor Trustee does not take office within 30 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of a majority in principal amount of the Securities may petition any court of competent jurisdiction for the appointment of a successor Trustee. If the Trustee fails to comply with TIA Section 310(a) or Section 310(b) or with Section 7.09, any Securityholder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee. A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Holders of Registered Securities. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided for in Section 7.06. SECTION 7.0903. Successor Trustee by Merger, etc. If the Trustee consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor corporation without any further act shall be the successor Trustee. SECTION 7.10. Trustee's Capital and Surplus. The Trustee, or the bank holding company of which the Trustee is a wholly owned Subsidiary, at all times shall have a combined capital and surplus of at least $50,000,000 as set 33 -28- forth in its most recent published report of financial condition. ARTICLE 8 -- DISCHARGE OF INDENTURE SECTION 8.01. Defeasance. Securities of a series may be defeased in accordance with their terms and, unless the Securities Resolution otherwise provides, in accordance with this Article. The Company at any time may terminate as to a series all of its obligations under this Indenture, the Securities of the series and any related coupons ("legal defeasance option"). The Company at any time may terminate as to a series its obligations, if any, under any restrictive covenants which may be applicable to a particular series ("covenant defeasance option"). However, in the case of the legal defeasance option, the Company's obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07, 2.08, 7.06, 7.07 and 8.04 shall survive until the Securities of the series are no longer outstanding; thereafter the Company's obligations in Section 7.06 shall survive. The Company may exercise its legal defeasance option notwithstanding its prior exercise of its covenant defeasance option. If the Company exercises its legal defeasance option, a series may not be accelerated because of an Event of Default. If the Company exercises its covenant defeasance option, a series may not be accelerated by reference to any restrictive covenants which may be applicable to such series. The Trustee upon request shall acknowledge in writing the discharge of those obligations or restrictions that the Company terminates by defeasance. SECTION 8.02. Conditions to Defeasance. The Company may exercise as to a series its legal defeasance option or its covenant defeasance option if: (1) the Company irrevocably deposits in trust with the Trustee or another trustee money or U.S. Government Obligations; (2) the Company delivers to the Trustee a certificate from a nationally recognized firm of inde- 34 -29- pendent accountants expressing their opinion that the payments of principal and interest when due on the deposited noncallable U.S. Government Obligations without reinvestment plus any deposited money without investment will provide cash at such times and in such amounts as will be sufficient to pay principal and interest when due on all the Securities of the series to maturity or redemption, as the case may be; (3) the Company deliver to the Trustee an Officers' certificate stating that immediately after the deposit no Default exists; (4) the Company deliver an Officers' Certificate stating that the deposit does not constitute a default under any other agreement binding on the Company; (5) the deposit does not cause the Trustee to have a conflicting interest under TIA Section 310(a) or Section 310(b) as to another series; (6) the Company delivers to the Trustee an Opinion of Counsel to the effect that Holders of the series will not recognize income, gain or loss for Federal income tax purposes as a result of the defeasance; and (7) 91 days pass after the deposit is made and during the 91-day period no Default specified in Section 6.01(5) or (6) occurs that is continuing at the end of the period. Before or after a deposit the Company may make arrangements satisfactory to the Trustee for the redemption of Securities at a future date in accordance with Article 3. "U.S. GOVERNMENT OBLIGATIONS" means direct obligations of (i) the United States or (ii) an agency or instrumentality of the United States, the payment of which is unconditionally guaranteed by the United States, which, in either case, have the full faith and credit of the United States pledged for payment and which are not callable at the issuer's option, or certificates representing an ownership interest in such obligations. 35 -30- SECTION 8.03. Application of Trust Money. The Trustee shall hold in trust money or U.S. Government Obligations deposited with it pursuant to Section 8.02. It shall apply the deposited money and the money from U.S. Government Obligations through the Paying Agent and in accordance with this Indenture to the payment of principal and interest on Securities of the defeased series. SECTION 8.04. Repayment to Company. The Trustee and the Paying Agent shall promptly turn over to the Company upon request any excess money or securities held by them at any time. The Trustee and the Paying Agent shall pay to the Company upon written request any money held by them for the payment of principal or interest that remains unclaimed for two years. After payment to the Company, Securityholders entitled to the money must look to the Company for payment as unsecured general creditors unless an abandoned property law designates another person and all liability of the Trustee and paying agent with respect to such money shall cease. ARTICLE 9 -- AMENDMENTS SECTION 9.01. Without Consent of Holders. The Company and the Trustee may amend this Indenture, the Securities or any coupons without the consent of any Securityholder: (1) to cure any ambiguity, omission, defect or inconsistency; (2) to comply with Section 5.01(2). (3) to provide that specific provisions of this Indenture shall not apply to a series not previously issued; (4) to create a series and establish its terms; (5) to provide for a separate Trustee for one or more series; or 36 -31- (6) to make any change that does not materially adversely affect the rights of any Securityholder. SECTION 9.02. With Consent of Holders. Unless the Securities Resolution otherwise provides, the Company and the Trustee may amend this Indenture, the Securities and any coupons with the written consent of the Holders of a majority in principal amount of the Securities of all series affected by the amendment voting as one class. However, without the consent of each Securityholder affected, an amendment under this Section may not: (1) reduce the amount of Securities whose Holders must consent to an amendment; (2) reduce the interest on or change the time for payment of interest on any Security; (3) change the fixed maturity of any Security; (4) reduce the principal of any non-Discounted Debt Security or reduce the amount of principal of any Discounted Debt Security that would be due upon an acceleration thereof; (5) change the currency in which principal or interest on a Security is payable; (6) make any change that materially adversely affects the right to convert any Security; or (7) make any change in Section 6.04 or 9.02, except to increase the amount of Securities whose Holders must consent to an amendment or waiver or to provide that other provisions of this Indenture cannot be amended or waived without the consent of each Securityholder affected thereby. An amendment of a provision included solely for the benefit of one or more series does not affect Securityholders of any other series. Securityholders need not consent to the exact text of a proposed amendment or waiver; it is sufficient if they consent to the substance thereof. 37 -32- SECTION 9.03. Compliance with Trust Indenture Act. Every amendment pursuant to Section 9.01 or 9.02 shall be set forth in a supplemental indenture (except any amendment pursuant to Section 9.01(4), which may be set forth in a Securities Resolution) that complies with the TIA. If a provision of the TIA requires or permits a provision of this Indenture and the TIA provision is amended, then the Indenture provision shall be automatically amended to like effect. SECTION 9.04. Effect of Consents. An amendment or waiver becomes effective in accordance with its terms and thereafter binds every Securityholder entitled to consent to it. A consent to an amendment or waiver by a Holder of a Security is a continuing consent by the Holder and every subsequent Holder of a Security that evidences the same debt as the consenting Holder's Security. Any Holder or subsequent Holder may revoke the consent as to his Security if the Trustee receives notice of the revocation before the amendment or waiver becomes effective. The Company may fix a record date for the determination of Holders of Registered Securities entitled to give a consent. The record date shall not be less than 10 nor more than 60 days prior to the first written solicitation of Securityholders. SECTION 9.05. Notation on or Exchange of Securities. The Company may place an appropriate notation about an amendment or waiver on any Security thereafter authenticated. The Company may issue in exchange for affected Securities and the Trustee shall authenticate new Securities that reflect the amendment or waiver. SECTION 9.06. Trustee Protected. The Trustee need not sign any supplemental indenture that adversely affects its rights. The Trustee shall be entitled to receive, and shall be fully protected in relying upon, an Opinion of Counsel and an Officers' Certificate each stating that the execution of any amendment or supplement or waiver authorized pursuant to this Article is authorized or permitted 38 -33- by this Indenture, and that such amendment or supplement or waiver constitutes the legal, valid and binding obligation of the Company. ARTICLE 10 -- MISCELLANEOUS SECTION 10.01. Trust Indenture Act. The provisions of TIA Sections 310 through 317 that impose duties on any person (including the provisions automatically deemed included herein unless expressly excluded by this Indenture) are a part of and govern this Indenture, whether or not expressly set forth herein. If any provision of this Indenture limits, qualifies or conflicts with another provision which is required to be included in this Indenture by the TIA, the required provision shall control. If any provision of this Indenture modifies or excludes any provision of the TIA that may be so modified or excluded, the latter provision shall be deemed to apply to this Indenture as so modified or excluded, as the case may be. SECTION 10.02. Notices. Any notice by one party to another is duly given if in writing and delivered in person, sent by facsimile transmission confirmed by mail or mailed by first-class mail to the other's address shown below: Company: Alpharma Inc. One Executive Drive Fort Lee, New Jersey 07024 Fax: (201) 947-5541 Trustee: [ADDRESS OF TRUSTEE] A party by notice to the other parties may designate additional or different addresses for subsequent notices. Any notice mailed to a Securityholder shall be mailed to his address shown on the register kept by the Registrar or on the list referred to in Section 2.06. Failure to mail a no- 39 -34- tice to a Securityholder or any defect in a notice mailed to a Securityholder shall not affect the sufficiency of the notice mailed to other Securityholders or the sufficiency of any published notice. If a notice is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it. If the Company mails a notice to Securityholders, it shall mail a copy to the Trustee and each Agent at the same time. If in the Company's opinion it is impractical to mail a notice required to be mailed or to publish a notice required to be published, the Company may give such substitute notice as the Trustee approves. Failure to publish a notice as required or any defect in it shall not affect the sufficiency of any mailed notice. All notices shall be in the English language, except that any published notice may be in an official language of the country of publication. A "notice" includes any communication required by this Indenture. SECTION 10.03. Certificate and Opinion as to Conditions Precedent. Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall if so requested furnish to the Trustee: (1) an Officers' Certificate stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and (2) an Opinion of Counsel stating that, in the opinion of such counsel, all such conditions precedent have been complied with. 40 -35- SECTION 10.04. Statements Required in Certificate or Opinion. Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include: (1) a statement that the person making such certificate or opinion has read such covenant or condition; (2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (3) a statement that, in the opinion of such person, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and (4) a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with. SECTION 10.05. Rules by Company and Agents. The Company may make reasonable rules for action by or a meeting of Securityholders. An Agent may make reasonable rules and set reasonable requirements for its functions. SECTION 10.06. No Lien Created, etc. Except as provided in Section 7.06, this Indenture and the Securities do not create a Lien, charge or encumbrance on any property of the Company or any Subsidiary. SECTION 10.07. Legal Holidays. A "LEGAL HOLIDAY" is a Saturday, a Sunday or a day on which banking institutions are not required to be open. If a payment date is a Legal Holiday at a place of payment, unless the Securities Resolution establishing a series otherwise provides with respect to Securities of the series, payment may be made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period. 41 -36- SECTION 10.08. No Recourse Against Others. All liability described in the Securities of any director, officer, employee or stockholder, as such, of the Company is waived and released. SECTION 10.09. Duplicate Originals. The parties may sign any number of copies of this Indenture. One signed copy is enough to prove this Indenture. SECTION 10.10. Governing Law. The laws of the State of New York shall govern this Indenture, the Securities and any coupons, unless federal law governs. 42 S-1 SIGNATURES Dated: , ALPHARMA INC. By_______________________________________ Name: Title: Dated: , [TRUSTEE] By_______________________________________ Name: Title: 43 EXHIBIT A A Form of Registered Security No. $ ALPHARMA INC. [Title of Security] Alpharma Inc. promises to pay to or registered assigns the principal sum of Dollars on , Interest Payment Dates: Record Dates: Dated: ALPHARMA INC. by (SEAL)_____________________________________ Authenticated: Chairman of the Board [Name of Trustee], as Trustee By _____________________ ____________________________________ Authorized Signature Vice President A-1 44 ALPHARMA INC. [Title of Security] [Explanatory Notes follow Exhibit B] 1. INTEREST.(1) Alpharma Inc. ("Company"), a corporation organized and existing under the laws of the State of Delaware, promises to pay interest on the principal amount of this Security at the rate per annum shown above. The Company will pay interest on and of each year commencing , 19__. Interest on the Securities will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from , 19__. Interest will be computed on the basis of a 360-day year of twelve 30-day months. 2. METHOD OF PAYMENT.(2) The Company will pay interest on the Securities to the persons who are registered holders of Securities at the close of business on the record date for the next interest payment date, except as otherwise provided in the Indenture. Holders must surrender Securities to a Paying Agent to collect principal payments. The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. The Company may pay principal and interest by check payable in such money. It may mail an interest check to a holder's registered address. 3. AGENTS. Initially, Attention: , will act as Paying Agent and Registrar. The Company may change any Paying Agent or Registrar without notice or provide for more than one such agent. The Company or any Affiliate may act in any such capacity. 4. INDENTURE. The Company issued the securities of this series ("Securities") under an Indenture dated as of A-2 45 , ("Indenture") between the Company and ("Trustee"). The terms of the Securities include those stated in the Indenture and in the Securities Resolution creating the Securities and those made part of the Indenture by the Trust Indenture Act of 1939 (15 U.S. Code Sections 77aaa-77bbbb), as amended. Securityholders are referred to the Indenture, the Securities Resolution and the Act for a statement of such terms. 5. OPTIONAL REDEMPTION.(3) On or after , the Company may redeem all the Securities at any time or some of them from time to time at the following redemption prices (expressed in percentages of principal amount), plus accrued interest to the redemption date. If redeemed during the 12-month period beginning, Year Percentage Year Percentage and thereafter at 100%. 6. MANDATORY REDEMPTION.(4) The Company will redeem $ principal amount of Securities on and on each thereafter through at a redemption price of 100% of principal amount, plus accrued interest to the redemption date.(5) The Company may reduce the principal amount of Securities to be redeemed pursuant to this paragraph by subtracting 100% of the principal amount (excluding premium) of any Securities (i) that the Company has acquired or that the Company has redeemed other than pursuant to this paragraph and (ii) that the Company has delivered to the Registrar for cancellation. The Company may so subtract the same Security only once. 7. ADDITIONAL OPTIONAL REDEMPTION.(6) In addition to redemptions pursuant to the above paragraph(s), the Company may redeem not more than $ principal amount of Securities on and on each thereafter A-3 46 through at a redemption price of 100% of principal amount, plus accrued interest to the redemption date. 8. NOTICE OF REDEMPTION.(7) Notice of redemption will be mailed at least 30 days before the redemption date to each holder of Securities to be redeemed at his registered address. A notice of redemption may provide that it is subject to the occurrence of any event before the date fixed for such redemption as described in such notice ("Conditional Redemption") and such notice of Conditional Redemption shall be of no effect unless all such conditions to the redemption have occurred before such date or have been waived by the Company. 9. DENOMINATIONS, TRANSFER, EXCHANGE. The Securities are in registered form without coupons in denominations of $1,0008 and whole multiples of $1,000. The transfer of Securities may be registered and Securities may be exchanged as provided in the Indenture. The Trustee may require a holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or the Indenture. The Trustee need not exchange or register the transfer of any Security or portion of a Security selected for redemption. Also, it need not exchange or register the transfer of any Securities for a period of 15 days before a selection of Securities to be redeemed. 10. PERSONS DEEMED OWNERS. The registered holder of a Security may be treated as its owner for all purposes. 11. AMENDMENTS AND WAIVERS. Subject to certain exceptions, the Indenture or the Securities may be amended with the consent of the holders of a majority in principal amount of the securities of all series affected by the amendment.(9) Subject to certain exceptions, a default on a series A-4 47 may be waived with the consent of the holders of a majority in principal amount of the series. Without the consent of any Securityholder, the Indenture or the Securities may be amended, among other things, to cure any ambiguity, omission, defect or inconsistency; to provide for assumption of Company obligations to Securityholders; or to make any change that does not materially adversely affect the rights of any Securityholder. 12. RESTRICTIVE COVENANTS.(10) The Securities are unsecured general obligations of the Company limited to $ principal amount. The Indenture does not limit other unsecured debt. 13. SUCCESSORS. When a successor assumes all the obligations of the Company under the Securities and the Indenture, the Company will be released from those obligations. 14. DEFEASANCE PRIOR TO REDEMPTION OR MATURITY.(11) Subject to certain conditions, the Company at any time may terminate some or all of its obligations under the Securities and the Indenture if the Company deposits with the Trustee money or U.S. Government Obligations for the payment of principal and interest on the Securities to redemption or maturity. U.S. Government Obligations are securities backed by the full faith and credit of the United States of America or certificates representing an ownership interest in such Obligations. 15. DEFAULTS AND REMEDIES. An Event of Default(12) includes: default for 60 days in payment of interest on the Securities; default in payment of principal on the Securities; default for 60 days in payment or satisfaction of any sinking fund obligation; default by the Company for a specified period after notice to it in the performance of any of its other agreements applicable to the Securities; certain events of bankruptcy or insolvency; and A-5 48 any other Event of Default provided for in the series. If an Event of Default occurs and is continuing, the Trustee or the holders of at least 33-1/3% in principal amount of the Securities may declare the principal(13) of all the Securities to be due and payable immediately. Securityholders may not enforce the Indenture or the Securities except as provided in the Indenture. The Trustee may require indemnity satisfactory to it before it enforces the Indenture or the Securities. Subject to certain limitations, holders of a majority in principal amount of the Securities may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Securityholders notice of any continuing default (except a default in payment of principal or interest) if it determines that withholding notice is in their interests. The Company must furnish an annual compliance certificate to the Trustee. 16. TRUSTEE DEALINGS WITH COMPANY. , the Trustee under the Indenture, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not Trustee. 17. NO RECOURSE AGAINST OTHERS. A director, officer, employee or stockholder, as such, of the Company shall not have any liability for any obligations of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. Each Securityholder by accepting a Security waives and releases all such liability. The waiver and release are part of the consideration for the issue of the Securities. 18. AUTHENTICATION. This Security shall not be valid until authenticated by a manual signature of the Registrar. A-6 49 19. ABBREVIATIONS. Customary abbreviations may be used in the name of a Securityholder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entirety), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= custodian), and U/G/M/A (= Uniform Gifts to Minors Act). THE COMPANY WILL FURNISH TO ANY SECURITYHOLDER UPON WRITTEN REQUEST AND WITHOUT CHARGE A COPY OF THE INDENTURE AND THE SECURITIES RESOLUTION WHICH CONTAINS THE TEXT OF THIS SECURITY IN LARGER TYPE. REQUESTS MAY BE MADE TO: ALPHARMA INC., ONE EXECUTIVE DRIVE, FORT LEE, NEW JERSEY 07024, ATTENTION: TREASURER. A-7 50 EXHIBIT B A Form of Bearer Security No. $ ALPHARMA INC. [Title of Security] [Explanatory Notes follow ] Alpharma Inc. promises to pay to bearer the principal sum of Dollars on , Interest Payment Dates: Dated: ALPHARMA INC. (SEAL) by Authenticated: ________________________________ Chairman of the Board [Name of Trustee], as Trustee By ____________________________ ________________________________ Authorized Signature Vice President B-1 51 ALPHARMA INC. [Title of Security] 1. INTEREST.(1) Alpharma Inc. ("Company"), a corporation organized and existing under the laws of the State of Delaware, promises to pay to bearer interest on the principal amount of this Security at the rate per annum shown above. The Company will pay interest on and of each year commencing , 19__. Interest on the Securities will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from , 19__. Interest will be computed on the basis of a 360-day year of twelve 30-day months. 2. METHOD OF PAYMENT.(2) Holders must surrender Securities and any coupons to a Paying Agent to collect principal and interest payments. The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. The Company may pay principal and interest by check payable in such money. 3. AGENTS. Initially, , Attention: , will act as Paying Agent and Registrar. The Company may change any Paying Agent or Registrar without notice or provide for more than one such agent. The Company or any Affiliate may act in any such capacity. 4. INDENTURE. The Company issued the securities of this series ("Securities") under an Indenture dated as of , ("Indenture") between the Company and ("Trustee"). The terms of the Securities include those stated in the Indenture and the Securities Resolution and those made part of the Indenture by the Trust Indenture Act of 1939 (15 U.S. B-2 52 Code Sections 77aaa-77bbbb), as amended. Securityholders are referred to the Indenture, the Securities Resolution and the Act for a statement of such terms. 5. OPTIONAL REDEMPTION.(3) On or after , the Company may redeem all the Securities at any time or some of them from time to time at the following redemption prices (expressed in percentages of principal amount), plus accrued interest to the redemption date. If redeemed during the 12-month period beginning, Year Percentage Year Percentage and thereafter 100%. 6. MANDATORY REDEMPTION.(4) The Company will redeem $ principal amount of Securities on and on each thereafter through at a redemption price of 100% of principal amount, plus accrued interest to the redemption date.(5) The Company may reduce the principal amount of Securities to be redeemed pursuant to this paragraph by subtracting 100% of the principal amount (excluding premium) of any Securities (i) that the Company has acquired or that the Company has redeemed other than pursuant to this paragraph and (ii) that the Company has delivered to the Registrar for cancellation. The Company may so subtract the same Security only once. 7. ADDITIONAL OPTIONAL REDEMPTION.(6) In addition to redemptions pursuant to the above paragraph(s), the Company may redeem not more than $ principal amount of Securities on and on each thereafter through at a redemption price of 100% of principal amount, plus accrued interest to the redemption date. B-3 53 8. NOTICE OF REDEMPTION.(7) Notice of redemption will be published once in an Authorized Newspaper in the City of New York and if the Securities are listed on any stock exchange located outside the United States and such stock exchange so requires, in any other required city outside the United States at least 30 days before the redemption date. Notice of redemption also will be mailed to holders who have filed their names and addresses with the Transfer Agent within the two preceding years. A holder of Securities may miss important notices if he fails to maintain his name and address with the Transfer Agent. A notice of redemption may provide that it is subject to the occurrence of any event before the date fixed for such redemption as described in such notice ("Conditional Redemption") and such notice of Conditional Redemption shall be of no effect unless all such conditions to the redemption have occurred before such date or have been waived by the Company. 9. DENOMINATIONS, TRANSFER, EXCHANGE. The Securities are in bearer form with coupons in denominations of $5,0008 and whole multiples of $5,000. The Securities may be transferred by delivery and exchanged as provided in the Indenture. Upon an exchange, the Trustee may require a holder, among other things, to furnish appropriate documents and to pay any taxes and fees required by law or the Indenture. The Trustee need not exchange any Security or portion of a Security selected for redemption. Also, it need not exchange any Securities for a period of 15 days before a selection of Securities to be redeemed. 10. PERSONS DEEMED OWNERS. The holder of a Security or coupon may be treated as its owner for all purposes. 11. AMENDMENTS AND WAIVERS. Subject to certain exceptions, the Indenture or the Securities may be amended with the consent of the B-4 54 holders of a majority in principal amount of the securities of all series affected by the amendment.9 Subject to certain exceptions, a default on a series may be waived with the consent of the holders of a majority in principal amount of the series. Without the consent of any Securityholder, the Indenture or the Securities may be amended, among other things, to cure any ambiguity, omission, defect or inconsistency; to provide for assumption of Company obligations to Securityholders; or to make any change that does not materially adversely affect the rights of any Securityholder. 12. RESTRICTIVE COVENANTS.(10) The Securities are unsecured general obligations of the Company limited to $ principal amount. The Indenture does not limit other unsecured debt. 13. SUCCESSORS. When a successor assumes all the obligations of the Company under the Securities, any coupons and the Indenture, the Company will be released from those obligations. 14. DEFEASANCE PRIOR TO REDEMPTION OR MATURITY.(11) Subject to certain conditions, the Company at any time may terminate some or all of its obligations under the Securities, any coupons and the Indenture if the Company deposits with the Trustee money or U.S. Government Obligations for the payment of principal and interest on the Securities to redemption or maturity. U.S. Government Obligations are securities backed by the full faith and credit of the United States of America or certificates representing an ownership interest in such Obligations. 15. DEFAULTS AND REMEDIES. An Event of Default(12) includes: default for 60 days in payment of interest on the Securities; default in payment of principal on the Securities; default for 60 days in payment or satisfaction of any sinking B-5 55 fund obligation; default by the Company for a specified period after notice to it in the performance of any of its other agreements applicable to the Securities; certain events of bankruptcy or insolvency; and any other Event of Default provided for in the series. If an Event of Default occurs and is continuing, the Trustee or the holders of at least 33-1/3% in principal amount of the Securities may declare the principal(13) of all the Securities to be due and payable immediately. Securityholders may not enforce the Indenture or the Securities except as provided in the Indenture. The Trustee may require indemnity satisfactory to it before it enforces the Indenture or the Securities. Subject to certain limitations, holders of a majority in principal amount of the Securities may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Securityholders notice of any continuing default (except a default in payment of principal or interest) if it determines that withholding notice is in their interests. The Company must furnish annual compliance certificates to the Trustee. 16. TRUSTEE DEALINGS WITH COMPANY. , the Trustee under the Indenture, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not Trustee. 17. NO RECOURSE AGAINST OTHERS. A director, officer, employee or stockholder, as such, of the Company shall not have any liability for any obligations of the Company under the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. Each Securityholder by accepting a Security waives and releases all such liability. The waiver and release are part of the consideration for the issue of the Securities. B-6 56 18. AUTHENTICATION. This Security shall not be valid until authenticated by a manual signature of the Registrar. 19. ABBREVIATIONS. Customary abbreviations may be used in the name of a Securityholder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entirety), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= custodian), and U/G/M/A (= Uniform Gifts to Minors Act). THE COMPANY WILL FURNISH TO ANY SECURITYHOLDER UPON WRITTEN REQUEST AND WITHOUT CHARGE A COPY OF THE INDENTURE AND THE SECURITIES RESOLUTION WHICH CONTAINS THE TEXT OF THIS SECURITY IN LARGER TYPE. REQUESTS MAY BE MADE TO: ALPHARMA INC., ONE EXECUTIVE DRIVE, FORT LEE, NEW JERSEY 07024, ATTENTION: TREASURER. B-7 57 [FACE OF COUPON] ............... [$]............ Due............ ALPHARMA INC. [Title of Security] Unless the Security attached to this coupon has been called for redemption, Alpharma Inc. (the "Company") will pay to bearer, upon surrender, the amount shown hereon when due. This coupon may be surrendered for payment to any Paying Agent listed on the back of this coupon unless the Company has replaced such Agent. Payment may be made by check. This coupon represents months' interest. ALPHARMA INC. By_______________________________________ [REVERSE OF COUPON] PAYING AGENTS B-8 58 NOTES TO EXHIBITS A AND B (1) If the Security is not to bear interest at a fixed rate per annum, insert a description of the manner in which the rate of interest is to be determined. If the Security is not to bear interest prior to maturity, so state. (2) If the method or currency of payment is different, insert a statement thereof. (3) If applicable. A restriction on redemption or refunding or any provision applicable to its redemption other may be added. (4) Such provisions as are applicable, if any. (5) If the Security is a Discounted Debt Security, insert amount to be redeemed or method of calculating such amount. (6) If applicable. Also insert, if applicable, provisions for repayment of Securities at the option of the Securityholder. (7) If applicable. (8) If applicable. Insert additional or different denominations and terms as appropriate. (9) If different terms apply, insert a brief summary thereof. (10) If applicable. If additional or different covenants apply, insert a brief summary thereof. (11) If applicable. If different defeasance terms apply, insert a brief summary thereof. (12) If additional or different Events of Default apply, insert a brief summary thereof. (13) If the Security is a Discounted Debt Security, set forth the amount due and payable upon an Event of Default. Note: U.S. tax law may require certain legends on Discounted Debt and Bearer Securities. 1 59 EXHIBIT C ASSIGNMENT FORM To assign this Security, fill in the form below: I or we assign and transfer this Security to ----------------------------------------- : : : : ----------------------------------------- (Insert assignee's soc. sec. or tax I.D. no.) ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ (Print or type assignee's name, address and zip code) and irrevocably appoint ____________________________ agent to transfer this Security on the books of the Company. The agent may substitute another to act for him. Date: _______________ Your Signature:________________________ ________________________ (Sign exactly as your name appears on the other side of this Security) C-1 EX-4.1B 3 FORM OF SECURITIES RESOLUTION 1 EXHIBIT 4.1B SECURITIES RESOLUTION NO. OF ALPHARMA INC. I, , Secretary of Alpharma Inc. (the "Company"), do hereby certify that the attached is a true and correct copy of Securities Resolution No. duly adopted by the of the Company pursuant to authorization delegated to him by the Committee of the Board of Directors of the company at a meeting called and held on the day of ; that a quorum of said Board Committee was present at said meeting and voted throughout; and I do further certify that said resolution has not been rescinded and remains in full force and effect. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the corporate seal of ALPHARMA INC. this day of . By:_________________________________ Name: Title: [CORPORATE SEAL] 2 [ ]% [ ] NOTES DUE [ ] SECURITIES RESOLUTION NO. [ ] OF ALPHARMA INC. The actions described below are taken by the Board of Directors (the "Board") of ALPHARMA INC. (the "Company"), or by an Officer or committee of Officer or committee of Officers pursuant to Board delegation, in accordance with resolutions adopted by the Board as of [ ], resolutions adopted by the Committee of the Board as of [ ], and Section 2.02 of the Indenture dated as of [ ] (the "Indenture") between the Company and [ ], Trustee. Terms used herein and not defined have the same meaning given such terms in the Indenture. RESOLVED, that a new series of Debt Securities is authorized as follows: 1. The title of the series is [ ]% [ ] Notes due [ ] ("Notes"). 2. The form of the Notes shall be substantially in the form of Exhibit 1 hereto. 3. The Notes shall have the terms set forth in Exhibit 1. 4. The Notes shall be sold to the underwriter(s) named in the Prospectus Supplement dated [ ] on the following terms: Price to Public: Underwriting Discount: Closing Date: This Securities Resolution shall be effect as of [ ]. EX-5.1 4 OPINION OF KIRKLAND & ELLIS 1 Exhibit 5.1 August 27, 1999 Alpharma Inc. One Executive Drive Fort Lee, NJ 07024 Ladies and Gentlemen: We are acting as special counsel to Alpharma Inc., a Delaware corporation (the "Corporation"), in connection with its registration statement on Form S-3 (the "Registration Statement"), being filed with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the "Securities Act"), on the date hereof in connection with the proposed offer and sale of the following securities (collectively, the "Securities") of the Corporation having an aggregate initial offering price of up to $250,000,000: (i) senior debt securities (the "Senior Debt Securities"); (ii) subordinated debt securities (the "Subordinated Debt Securities," and together with the Senior Debt Securities, the "Debt Securities"); and (iii) Class A common stock, par value $.20 per share (the "Common Stock"), of the Corporation. The Securities may be offered in separate series, in amounts, at prices, and on terms to be set forth in the prospectus and one or more supplements to the prospectus (collectively, the "Prospectus") constituting a part of the Registration Statement, and in the Registration Statement. The Debt Securities are to be issued under one or more indentures generally in the form incorporated by reference as Exhibit 4.1 to the Registration Statement (the "Indentures"). Certain terms of the Securities to be issued by the Corporation from time to time will be approved by the Board of Directors of the Corporation or a committee thereof or certain authorized officers of the Corporation as part of the corporate action taken and to be taken (the "Corporate Proceedings") in connection with issuance of the Securities. We have examined or are otherwise familiar with the Amended and Restated Certificate of Incorporation of the Corporation, the Bylaws of the Corporation, as amended, the Registration Statement, such of the Corporate Proceedings as have occurred as of the date hereof, and such other documents, records and instruments as we have deemed necessary or appropriate for the purposes of this opinion letter. 2 For purposes of this opinion letter, we have assumed the authenticity of all documents submitted to us as originals, the conformity to the originals of all documents submitted to us as copies and the authenticity of the originals of all documents submitted to us as copies. We have also assumed the legal capacity of all natural persons, the genuineness of the signatures of persons signing all documents in connection with which this opinion is rendered, the authority of such persons signing on behalf of the parties thereto other than the Corporation and the due authorization, execution and delivery of all documents by the parties thereto other than the Corporation. As to any facts material to the opinions expressed herein, we have relied upon the statements and representations of officers and other representations of the Corporation and others. Our advice on every legal issue addressed in this letter is based exclusively on the internal laws of the State of New York, the General Corporation Law of the State of Delaware and the federal law of the United States of America, and represents our opinion as to how that issue would be resolved were it to be considered by the highest court in the jurisdiction which enacted such law. The manner in which any particular issue would be treated in any actual court case would depend in part on facts and circumstances particular to the case, and this opinion letter is not intended to guarantee the outcome of any legal dispute which may arise in the future. Based upon and subject to the foregoing qualifications, assumptions and limitations and the further limitations set forth below, we hereby advise you that in our opinion: (i) the Debt Securities, when authorized and sold as contemplated in the Registration Statement, will be validly issued by the Corporation and will constitute valid and legally binding obligations of the Corporation, enforceable in accordance with their terms; and (ii) the Common Stock, when authorized and sold as contemplated in the Registration Statement, will be validly issued by the Corporation and will be duly authorized, fully paid and non-assessable. The foregoing opinions assume that (i) the consideration designated in the applicable Corporate Proceedings for any Common Stock shall have been received by the Corporation in accordance with applicable law; (ii) the applicable Indenture shall have been duly authorized, executed and delivered by all parties thereto other than the Corporation; (iii) the Registration Statement shall have become effective under the Securities Act; and (iv) the applicable Indenture shall have become duly qualified under the Trust Indenture Act of 1939, as amended. Our opinion in paragraph (i) of this opinion letter is subject to: (A) the effect of bankruptcy, insolvency, fraudulent conveyance and other similar laws and judicially developed doctrines in this area such as substantive consolidation and equitable subordination; (B) the effect of general principles of equity; and (C) other commonly recognized statutory and judicial constraints on enforceability including statutes of limitations. "General principles of equity" include but are not limited to: principles which limit the availability of specific performance and injunctive relief; 2 3 principles which limit the availability of a remedy under certain circumstances where another remedy has been elected; principles requiring reasonableness, good faith and fair dealing in the performance and enforcement of an agreement by the party seeking enforcement; principles which may permit a party to cure a material failure to perform its obligations; and principles affording equitable defenses such as waiver, laches and estoppel. It is possible that some of the terms of the Debt Securities and the Indenture may not prove enforceable against the Corporation for reasons other than those listed in this opinion letter should an actual enforcement action be brought, but (subject to all the exceptions, qualifications, exclusions and other limitations in this letter) such unenforceability would not in our opinion prevent the holders of the Debt Securities from realizing the principal benefits purported to be provided by the Debt Securities and the Indenture. We do not find it necessary for the purposes of this opinion, and accordingly we do not purport to cover herein, the application of the securities of "Blue Sky" laws of the various states to the Securities. This opinion letter is limited to the specific issues addressed herein, and no opinion may be inferred or implied beyond that expressly stated herein. We assume no obligation to revise or supplement this opinion should the present laws of the State of New York, the General Corporation Law of the State of Delaware or the federal law of the United States be changed by legislative action, judicial decision or otherwise. We hereby consent to the filing of this opinion letter with the Commission as Exhibit 5.1 to the Registration Statement. We also consent to the reference to our firm under the heading "Legal Matters" in the Registration Statement. In giving this consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933 or the rules and regulations of the Commission. Very truly yours, /s/ Kirkland & Ellis KIRKLAND & ELLIS 3 EX-12.1 5 STATEMENT RE: COMPUTATION OF RATIO OF EARNINGS 1 ALPHARMA INC. AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (In thousands, except for ratio data)
Six months Six months ended ended June 30, June 30, --------------------------------------------------------- ---------- ---------- 1994 1995 1996 1997 1998 1998 1999 -------- -------- -------- -------- -------- -------- -------- Income before provision for income taxes $ 1,736 $ 30,228 $(16,226) $ 27,750 $ 38,983 $ 13,949 $ 23,987 Add: Portion of rents representative of the interest factor 1,838 1,858 2,193 1,942 2,222 1,056 1,104 Interest on indebtedness 15,355 21,993 19,976 18,581 25,613 10,979 16,323 Amortization of debt expense 246 302 302 309 1,313 339 657 Amortization of interest capitalized 313 386 397 380 408 204 230 -------- -------- -------- -------- -------- -------- -------- INCOME AS ADJUSTED $ 19,488 $ 54,767 $ 6,642 $ 48,962 $ 68,539 $ 26,527 $ 42,301 ======== ======== ======== ======== ======== ======== ======== FIXED CHARGES Interest on indebtedness (a) $ 15,355 $ 21,993 $ 19,976 $ 18,581 $ 25,613 $ 10,979 $ 16,323 Interest capitalized (b) 722 318 572 407 744 351 250 Amortization of debt expense (c ) 246 302 302 309 1,313 339 657 Rent expense 5,513 5,574 6,578 5,825 6,665 3,169 3,312 Portion of rents representative of the interest factor (d) 1,838 1,858 2,193 1,942 2,222 1,056 1,104 -------- -------- -------- -------- -------- -------- -------- Fixed charges (a+b+c+d) $ 18,161 $ 24,471 $ 23,043 $ 21,239 $ 29,892 $ 12,725 $ 18,334 ======== ======== ======== ======== ======== ======== ======== RATIO OF EARNINGS TO FIXED CHARGES 1.07 2.24 -- 2.31 2.29 2.08 2.31 ======== ======== ======== ======== ======== ======== ========
EX-23.1 6 CONSENT OF PRICEWATERHOUSECOOPERS, LLP 1 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in this Registration Statement on Form S-3 of our report dated February 24, 1999 relating to the financial statements, which appears in Alpharma Inc.'s Annual Report on Form 10-K for the year ended December 31, 1998. We also consent to the reference to us under the heading "Experts" in such Registration Statement. /s/ PricewaterhouseCoopers LLP PricewaterhouseCoopers LLP Florham Park, New Jersey August 26, 1999 EX-25.1 7 FORM T-1 1 Exhibit 25.1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) FIRST UNION NATIONAL BANK (Name of Trustee) 22-1147033 (Jurisdiction of Incorporation or (I.R.S. Employer Organization if not a U.S. National Bank) Identification No.) 301 SOUTH COLLEGE STREET, CHARLOTTE, NORTH CAROLINA 28288-0630 (Address of Principal Executive Offices) (Zip Code) ALPHARMA INC. (Name of Obligor) DELAWARE 22-2095212 (State of Incorporation) (I.R.S. Employer Identification No.) ONE EXECUTIVE DRIVE, FORT LEE, NJ 07024 (Address of Principal Executive Offices) (Zip Code) DEBT SECURITIES (TITLE OF INDENTURE SECURITIES) 2 GENERAL ITEM 1. GENERAL INFORMATION. Furnish the following information as to the trustee: (a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISORY AUTHORITY TO WHICH IT IS SUBJECT: Comptroller of the Currency, Washington, D.C. Board of Governors of the Federal Reserve System, New York, N.Y. Federal Deposit Insurance Corporation, Washington, D.C. (b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS. The Trustee is authorized to exercise corporate trust powers. ITEM 2. AFFILIATIONS WITH OBLIGOR. IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION. None. ITEM 3. VOTING SECURITIES OF THE TRUSTEE. FURNISH THE FOLLOWING INFORMATION AS TO EACH CLASS OF VOTING SECURITIES OF THE TRUSTEE: COL. A COL. B ------ ------ TITLE OF CLASS AMOUNT OUTSTANDING Not applicable ITEM 4. TRUSTEESHIP UNDER OTHER INDENTURES: IF THE TRUSTEE IS A TRUSTEE UNDER ANOTHER INDENTURE UNDER WHICH ANY OTHER SECURITIES, OR CERTIFICATES OF INTEREST OR PARTICIPATION IN ANY OTHER SECURITIES, OF THE OBLIGOR ARE OUTSTANDING, FURNISH THE FOLLOWING INFORMATION: (a) TITLE OF THE SECURITIES OUTSTANDING UNDER EACH SUCH OTHER INDENTURE. Not Applicable (b) A BRIEF STATEMENT OF THE FACTS RELIED UPON AS A BASIS FOR THE CLAIM THAT NO CONFLICTING INTEREST WITHIN THE MEANING OF SECTION 310(b)(1) OF THE ACT ARISES AS A RESULT OF THE TRUSTEESHIP UNDER ANY SUCH OTHER INDENTURE, INCLUDING A STATEMENT AS TO HOW THE INDENTURE SECURITIES WILL RANK AS COMPARED WITH THE SECURITIES ISSUED UNDER SUCH OTHER INDENTURE. Not Applicable. ITEM 5. INTERLOCKING DIRECTORATES AND SIMILAR RELATIONSHIPS WITH THE OBLIGOR OR UNDERWRITERS. IF THE TRUSTEE OR ANY OF THE DIRECTORS OR EXECUTIVE OFFICERS OF THE TRUSTEE IS A DIRECTOR, OFFICER, PARTNER, EMPLOYEE, APPOINTEE, OR REPRESENTATIVE OF THE OBLIGOR OR OF ANY UNDERWRITER FOR THE OBLIGOR, IDENTIFY EACH SUCH PERSON HAVING ANY SUCH CONNECTION AND STATE THE NATURE OF EACH SUCH CONNECTION. Not Applicable 2 3 ITEM 6. VOTING SECURITIES OF THE TRUSTEE OWNED BY THE OBLIGOR OR ITS OFFICIALS. FURNISH THE FOLLOWING INFORMATION AS TO THE VOTING SECURITIES OF THE TRUSTEE OWNED BENEFICIALLY BY THE OBLIGOR AND EACH DIRECTOR, PARTNER AND EXECUTIVE OFFICER OF THE OBLIGOR.
COL. A COL. B COL. C COL. D ------ ------ ------ ------ Name of Owner Title of Class Amount owned Percentage of Voting beneficially securities represented by amount given in Col. C.
Not Applicable ITEM 7. VOTING SECURITIES OF THE TRUSTEE OWNED BY UNDERWRITERS OR THEIR OFFICIALS. FURNISH THE FOLLOWING INFORMATION AS TO THE VOTING SECURITIES OF THE TRUSTEE OWNED BENEFICIALLY BY EACH UNDERWRITER FOR THE OBLIGOR AND EACH DIRECTOR, PARTNER, AND EXECUTIVE OFFICER OF EACH SUCH UNDERWRITER.
COL. A COL. B COL. C COL. D ------ ------ ------ ------ Name of Owner Title of Class Amount owned Percentage of Voting beneficially securities represented by amount given in Col. C.
Not Applicable ITEM 8. SECURITIES OF THE OBLIGOR OWNED OR HELD BY THE TRUSTEE. FURNISH THE FOLLOWING INFORMATION AS TO SECURITIES OF THE OBLIGOR OWNED BENEFICIALLY OR HELD AS COLLATERAL SECURITY FOR THE OBLIGATIONS IN DEFAULT BY THE TRUSTEE.
COL. A COL. B COL. C COL. D ------ ------ ------ ------ Name of Owner Title of Class Amount owned Percentage of Voting beneficially securities represented by amount given in Col. C.
Not Applicable ITEM 9. SECURITIES OF THE UNDERWRITERS OWNED OR HELD BY THE TRUSTEE. IF THE TRUSTEE OWNS BENEFICIALLY OR HOLDS AS COLLATERAL SECURITY FOR OBLIGATIONS IN DEFAULT ANY SECURITIES OF AN UNDERWRITER FOR THE OBLIGOR, FURNISH THE FOLLOWING INFORMATION AS TO EACH CLASS OF SECURITIES OF SUCH UNDERWRITER ANY OF WHICH ARE SO OWNED OR HELD BY THE TRUSTEE. 3 4
COL. A COL. B COL. C COL. D - ------ ------ ------ ------ NAME OF ISSUER AND TITLE AMOUNT OUTSTANDING AMOUNT OWNED BENEFICIALLY PERCENT OF CLASS OF CLASS OR HELD AS COLLATERAL SECURITY REPRESENTED BY AMOUNT FOR OBLIGATIONS IN DEFAULT BY GIVEN IN COL. C. TRUSTEE
Not Applicable ITEM 10. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF VOTING SECURITIES OF CERTAIN AFFILIATES OR SECURITY HOLDERS OF THE OBLIGOR. IF THE TRUSTEE OWNS BENEFICIALLY OR HOLDS AS COLLATERAL SECURITY FOR OBLIGATIONS IN DEFAULT VOTING SECURITIES OF A PERSON WHO, TO THE KNOWLEDGE OF THE TRUSTEE (1) OWNS 10 PERCENT OR MORE OF THE VOTING SECURITIES OF THE OBLIGOR OR (2) IS AN AFFILIATE, OTHER THAN A SUBSIDIARY, OF THE OBLIGOR, FURNISH THE FOLLOWING INFORMATION AS TO THE VOTING SECURITIES OF SUCH PERSON.
COL. A COL. B COL. C COL. D - ------ ------ ------ ------ NAME OF ISSUER AND TITLE AMOUNT OUTSTANDING AMOUNT OWNED BENEFICIALLY PERCENT OF CLASS OF CLASS OR HELD AS COLLATERAL SECURITY REPRESENTED BY AMOUNT FOR OBLIGATIONS IN DEFAULT BY GIVEN IN COL. C. TRUSTEE
Not Applicable - -------------------------------------------------------------------------------- ITEM 11. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF ANY SECURITIES OF A PERSON OWNING 50 PERCENT OR MORE OF THE VOTING SECURITIES OF THE OBLIGOR. - -------------------------------------------------------------------------------- IF THE TRUSTEE OWNS BENEFICIALLY OR HOLDS AS COLLATERAL SECURITY FOR OBLIGATIONS IN DEFAULT ANY SECURITIES OF A PERSON WHO, TO THE KNOWLEDGE OF THE TRUSTEE, OWNS 50 PERCENT OR MORE OF THE VOTING SECURITIES OF THE OBLIGOR, FURNISH THE FOLLOWING INFORMATION AS TO EACH CLASS OF SECURITIES OF SUCH PERSON ANY OF WHICH ARE SO OWNED OR HELD BY THE TRUSTEE.
COL. A COL. B COL. C COL. D - ------ ------ ------ ------ NAME OF ISSUER AND TITLE AMOUNT OUTSTANDING AMOUNT OWNED BENEFICIALLY PERCENT OF CLASS OF CLASS OR HELD AS COLLATERAL SECURITY REPRESENTED BY AMOUNT FOR OBLIGATIONS IN DEFAULT BY GIVEN IN COL. C. TRUSTEE
Not Applicable ITEM 12. INDEBTEDNESS OF THE OBLIGOR TO THE TRUSTEE. EXCEPT AS NOTED IN THE INSTRUCTIONS, IF THE OBLIGOR IS INDEBTED TO THE TRUSTEE, FURNISH THE FOLLOWING INFORMATION:
COL. A COL. B COL. C - ------ ------ ------ NATURE OF INDEBTEDNESS AMOUNT OUTSTANDING DATE DUE .
Not Applicable 4 5 ITEM 13. DEFAULTS BY THE OBLIGOR. (A) STATE WHETHER THERE IS OR HAS BEEN A DEFAULT WITH RESPECT TO THE SECURITIES UNDER THIS INDENTURE. EXPLAIN THE NATURE OF ANY SUCH DEFAULT. None (B) IF THE TRUSTEE IS A TRUSTEE UNDER ANOTHER INDENTURE UNDER WHICH ANY OTHER SECURITIES, OR CERTIFICATES OF INTEREST OR PARTICIPATION IN ANY OTHER SECURITIES, OF THE OBLIGOR ARE OUTSTANDING, OR IS TRUSTEE FOR MORE THAN ONE OUTSTANDING SERIES OF SECURITIES UNDER THE INDENTURE, STATE WHETHER THERE HAS BEEN DEFAULT UNDER ANY SUCH INDENTURE OR SERIES, IDENTIFY THE INDENTURE OR SERIES AFFECTED, AND EXPLAIN THE NATURE OF ANY SUCH DEFAULT. None ITEM 14. AFFILIATIONS WITH THE UNDERWRITERS. IF ANY UNDERWRITER IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION. Not Applicable ITEM 15. FOREIGN TRUSTEE. IDENTIFY THE ORDER OR RULE PURSUANT TO WHICH THE FOREIGN TRUSTEE IS AUTHORIZED TO ACT AS SOLE TRUSTEE UNDER INDENTURES QUALIFIED OR TO BE QUALIFIED UNDER THE ACT. Not Applicable ITEM 16. LISTS OF EXHIBITS. 1* -COPY OF ARTICLES OF ASSOCIATION OF THE TRUSTEE AS NOW IN EFFECT. 2 -NO CERTIFICATE OF AUTHORITY OF THE TRUSTEE TO COMMENCE BUSINESS IS FURNISHED SINCE THIS AUTHORITY IS CONTAINED IN THE ARTICLES OF ASSOCIATION OF THE TRUSTEE. 3* -COPY OF THE AUTHORIZATION OF THE TRUSTEE TO EXERCISE CORPORATE TRUST POWERS. 4* -COPY OF THE EXISTING BY-LAWS OF THE TRUSTEE, AS NOW IN EFFECT. 5 -NOT APPLICABLE 6 -THE CONSENT OF THE TRUSTEE REQUIRED BY SECTION 321 (b) OF THE ACT. 7* -A COPY OF THE LATEST REPORT OF CONDITION OF THE TRUSTEE PUBLISHED PURSUANT TO THE LAW OR THE REQUIREMENTS OF ITS SUPERVISING OR EXAMINING AUTHORITY. 8 -NOT APPLICABLE 9 -NOT APPLICABLE - -------------------------------------------------------------------------------- *EXHIBITS THUS DESIGNATED HAVE HERETOFORE BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, HAVE NOT BEEN AMENDED SINCE FILING AND ARE INCORPORATED HEREIN BY REFERENCE (SEE EXHIBIT T-1 REGISTRATION NUMBER 333-79101). IN ANSWERING ANY ITEM IN THIS STATEMENT OF ELIGIBILITY AND QUALIFICATION WHICH RELATES TO MATTERS PECULIARLY WITHIN THE KNOWLEDGE OF THE OBLIGOR OR OF ITS DIRECTORS OR OFFICERS, OR AN UNDERWRITER FOR THE OBLIGOR, THE UNDERSIGNED, FIRST UNION NATIONAL BANK, HAS RELIED UPON INFORMATION FURNISHED TO IT BY THE OBLIGOR OR SUCH UNDERWRITER. 5 6 SIGNATURE PURSUANT TO THE REQUIREMENTS OF THE TRUST INDENTURE ACT OF 1939 THE TRUSTEE, FIRST UNION NATIONAL BANK, A NATIONAL BANKING ASSOCIATION ORGANIZED AND EXISTING UNDER THE LAWS OF THE UNITED STATES, HAS DULY CAUSED THIS STATEMENT OF ELIGIBILITY TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, ALL IN THE CITY OF MORRISTOWN, AND STATE OF NEW JERSEY, ON THE 18TH DAY OF AUGUST, 1999. FIRST UNION NATIONAL BANK (TRUSTEE) BY:/S/ CHRISTOPHER E.GOLABEK ------------------------- VICE PRESIDENT (CORPORATE SEAL) 6 7 EXHIBIT T-6 CONSENT OF TRUSTEE PURSUANT TO THE REQUIREMENTS OF SECTION 321 (b) OF THE TRUST INDENTURE ACT OF 1939, AND IN CONNECTION WITH THE PROPOSED ISSUE OF ALPHARMA INC., WE HEREBY CONSENT THAT REPORTS OF EXAMINATIONS BY FEDERAL, STATE, TERRITORIAL OR DISTRICT AUTHORITIES MAY BE FURNISHED BY SUCH AUTHORITIES TO THE SECURITIES AND EXCHANGE COMMISSION UPON REQUEST THEREFOR. FIRST UNION NATIONAL BANK BY: /S/ CHRISTOPHER E. GOLABEK ------------------------------ VICE PRESIDENT MORRISTOWN, NJ AUGUST 18, 1999 7 -----END PRIVACY-ENHANCED MESSAGE-----