Prospectus
Supplement
(To
Prospectus Dated July 12, 2006)
Warrants
and
1,000
Ordinary Shares Issuable upon Exercise of Warrants
We
are
offering warrants (“Warrants”), exerciseable into 1,000 of our ordinary shares,
₤0.50 par value per share, (each, an “Ordinary Share”) of Amarin Corporation plc
(“Amarin”), each Ordinary Share represented by one American Depositary Share
(each, an “ADS”), evidenced by American Depositary Receipts (“ADRs”), to
Strategic Pharmaceutical Solutions, Inc. (“SPS”) pursuant to this prospectus
supplement and the accompanying prospectus in consideration for consulting
services performed by SPS pursuant to the Consulting Agreement, dated as of
July 31, 2007, by and among the Amarin Pharmaceuticals Ireland Ltd., a
wholly owned subsidiary of the Company, and the original Holder of this Warrant
(the “Consulting Agreement”). See “Consulting
Agreement”. The warrants will be exerciseable at the price of $3.40
per Ordinary Share (the “Exercise Price”).
We
are
also registering the 1,000 Ordinary Shares issuable upon exercise of the
Warrants (the “Exercise Shares”) pursuant to this prospectus supplement and the
accompanying prospectus. The Warrants and the Exercise Shares are
collectively referred to herein as the “Securities”.
Our
ADSs
are traded on the Nasdaq Capital Market, the principal trading market for our
securities, under the symbol “AMRN.” On January 18, 2008, we
consummated a 1 for 10 reverse stock split of our Ordinary Shares and our
ADSs. See “Recent Developments—Reverse Stock Split”. Under customary Nasdaq practice,
in connection with the
reverse stock split, a “D”
will
be appended to Amarin’s Nasdaq ticker
symbol for the 20 trading
day period immediately following January 18, 2008, during
which our Nasdaq ticker symbol
will appear as
“AMRND”. The closing price of our ADSs on January 22,
2008 was $2.05 per ADS.
INVESTING
IN THE SHARES INVOLVES RISKS. SEE “RISK FACTORS” SECTION ON PAGE S-7 OF THIS
PROSPECTUS SUPPLEMENT.
|
Per
Share
|
Total
(1)
|
|
|
Offering
price (1), (2)
|
$3.40
|
$3,400
|
|
Offering
fees and commissions (3)
|
-
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-
|
|
Proceeds,
after fees and commissions, to us (4)
|
$3.40
|
$3,400
|
|
(1)
|
We
will not receive any cash proceeds from the issuance of the Warrants.
However, we have received certain consulting services from SPS under
the
Consulting Agreement for which the Warrants comprise a portion of
the
consideration. See “Consulting Agreement” on page S-3 and “Use of
Proceeds” on page S-8.
|
|
(2)
|
Assumes
that all 1,000 Exercise Shares issuable upon exercise of the Warrants
offered by this prospectus supplement are issued and sold in this
offering. There is no requirement that any minimum number of Exercise
Shares or dollar amount of Exercise Shares be issued and sold in
this
offering and there can be no assurance that we will issue and sell
all or
any of the Exercise Shares being offered.
|
|
(3)
|
No
discounts, commissions, concessions or other compensation has been
paid or
will be paid to any underwriter, broker, dealer or agent in connection
with the offering.
|
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(4)
|
Pursuant
to Rule 416, this registration statement also covers such indeterminate
number of additional Exercise Shares as may become issuable as a
result of
anti-dilution adjustments in accordance with the terms of the Warrants.
|
NEITHER
THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION
HAS
APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS
SUPPLEMENT OR THE ACCOMPANYING CORE PROSPECTUS IS TRUTHFUL OR
COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
The
Warrants offered hereby are being issued directly to SPS on or about
January 25, 2008. The Exercise Shares offered hereby will be
issued directly to SPS or its assigns on their date of issuance. No
discounts, commissions, concessions or other compensation has been paid or
will
be paid to any underwriter, broker, dealer or agent in connection with the
offering.
The
date
of this prospectus supplement is January 24, 2008.
TABLE
OF CONTENTS
PROSPECTUS
SUPPLEMENT
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PAGE
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|
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ABOUT
THIS PROSPECTUS SUPPLEMENT
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S-1
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NOTE
REGARDING FORWARD LOOKING STATEMENTS
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S-2
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CONSULTING
AGREEMENT
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S-3
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RECENT
DEVELOPMENTS
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S-4
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THE
OFFERING
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S-6
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RISK
FACTORS
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S-7
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USE
OF PROCEEDS
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S-8
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CAPITALIZATION
AND INDEBTEDNESS
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S-9
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DILUTION
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S-11
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PRICE
HISTORY
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S-12
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DESCRIPTION
OF THE WARRANTS
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S-13
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PLAN
OF DISTRIBUTION
|
S-20
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LEGAL
MATTERS
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S-20
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|
INCORPORATION
OF CERTAIN INFORMATION BY REFERENCE
|
S-20
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|
WHERE
YOU CAN FIND MORE INFORMATION
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S-21
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CORE
PROSPECTUS
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PAGE
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|
ABOUT
THIS PROSPECTUS
|
1
|
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AMARIN
CORPORATION PLC
|
2
|
|
AMARIN
FINANCE LTD.
|
2
|
|
RISK
FACTORS
|
3
|
|
FORWARD-LOOKING
STATEMENTS
|
16
|
|
PRESENTATION
OF FINANCIAL INFORMATION
|
18
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|
INCORPORATION
BY REFERENCE
|
19
|
|
WHERE
YOU CAN FIND MORE INFORMATION
|
20
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|
ENFORCEABILITY
OF CIVIL LIABILITIES
|
20
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USE
OF PROCEEDS
|
20
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RATIO
OF EARNINGS TO FIXED CHARGES AND RATIO OF EARNINGS TO
|
|
|
COMBINED
FIXED CHARGES AND PREFERENCE SHARE DIVIDENDS
|
21
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|
CAPITALIZATION
AND INDEBTEDNESS
|
21
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PRICE
HISTORY
|
23
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|
DESCRIPTION
OF DEBT SECURITIES AND GUARANTEES
|
24
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|
DESCRIPTION
OF ORDINARY SHARES
|
33
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|
DESCRIPTION
OF PREFERENCE SHARES
|
35
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DESCRIPTION
OF AMERICAN DEPOSITARY SHARES
|
37
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CERTAIN
PROVISIONS OF ENGLISH LAW AND OF THE COMPANY’S
|
|
|
MEMORANDUM
AND ARTICLES OF ASSOCIATION
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44
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DESCRIPTION
OF WARRANTS
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45
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DESCRIPTION
OF PURCHASE CONTRACTS
|
46
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DESCRIPTION
OF UNITS
|
47
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TAXATION
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47
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PLAN
OF DISTRIBUTION
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47
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EXPERTS
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49
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LEGAL
MATTERS
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50
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DISCLOSURE
OF COMMISSION POSITION ON INDEMNIFICATION FOR
|
|
|
SECURITIES
ACT LIABILITIES
|
50
|
-i-
This
prospectus is in two parts. The first part is this prospectus
supplement, which describes the material terms of this offering, including
the
material provisions of the Warrants, and adds to and updates information
contained in or incorporated by reference into the accompanying core
prospectus. The second part is the accompanying core prospectus,
which gives more information about us and the securities we may offer from
time
to time under the shelf registration statement of which this prospectus
supplement and accompanying core prospectus are a part. To the extent
there is a conflict between the information contained, or referred to, in this
prospectus supplement, on the one hand, and the information contained, or
referred to, in the accompanying core prospectus or any document incorporated
by
reference herein or therein, on the other hand, the information in this
prospectus supplement shall control.
We
have
not authorized any broker, dealer, salesperson or other person to give any
information or to make any representation. You must not rely upon any
information or representation not contained or incorporated by reference in
this
prospectus supplement or the accompanying core prospectus.
This
prospectus supplement and the
accompanying core prospectus do not constitute an offer to sell or the
solicitation of an offer to buy the Securities in any jurisdiction nor do this
prospectus supplement and the accompanying core prospectus constitute an offer
to sell or the solicitation of an offer to buy the Securities in any
jurisdiction to any person to whom it is unlawful to make such offer or
solicitation in such jurisdiction. You should not assume that
the information contained in this prospectus supplement and the accompanying
core prospectus is accurate on any date subsequent to the date set forth on
the
front of the document or that any information we have incorporated by reference
is correct on any date subsequent to the date of the document incorporated
by
reference, even though this prospectus supplement and any accompanying core
prospectus are delivered with securities that are sold on a later
date.
It
is
important for you to read and consider all information contained in this
prospectus supplement and the accompanying core prospectus, including the
documents we have referenced in the section entitled “Incorporation of Certain
Information by Reference” in this prospectus supplement.
In
this
prospectus supplement and the accompanying core prospectus, “Amarin,” “Company,”
“we,” “us” and “our” refer to Amarin Corporation plc and its consolidated
subsidiaries. References to “U.S. dollars,” “USD” or “$” are to the
lawful currency of the United States and references to “pounds sterling,” “GBP£”
or “£” are to the lawful currency of the United Kingdom.
S-1
NOTE
REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus supplement and the accompanying core prospectus include
forward-looking statements. These forward-looking statements relate,
among other things, to our future capital needs, our ability to acquire or
develop additional marketable products, acceptance of our products by
prescribers and end-users, competitive factors, and our marketing and sales
plans. In addition, we may make forward-looking statements in future
filings with the Securities and Exchange Commission (the “SEC”) and in written
material, press releases and oral statements issued by or on behalf of
us. Forward-looking statements include statements regarding our
intent, belief or current expectations or those of our management regarding
various matters, including statements that include forward-looking terminology
such as “may,” “will,” “should,” “believes,” “expects,” “anticipates,”
“estimates,” “continues,” or similar expressions.
Forward-looking
statements are subject to risks and uncertainties, certain of which are beyond
our control. Actual results could differ materially from those
anticipated in these forward-looking statements as a result of various factors,
including the factors described in the Risk Factors section of this prospectus
supplement. Some, but not all, of these factors are the timing of our
future capital needs and our ability to raise additional capital when needed,
our ability to obtain regulatory approval for our products, uncertainty of
market acceptance of our products, our ability to compete with other
pharmaceutical companies, our ability to develop or acquire new products,
problems with important third-party manufacturers on whom we rely, our ability
to attract and retain key personnel, and implementation and enforcement of
government regulations. This list of factors is not exclusive and
other risks and uncertainties may cause actual results to differ materially
from
those in forward-looking statements.
All
forward-looking statements in this prospectus supplement and core prospectus
are
based on information available to us on the date hereof. We may not
be required to publicly update or revise any forward-looking statements that
may
be made by us or on our behalf, in this prospectus supplement and core
prospectus or otherwise, whether as a result of new information, future events
or other reasons. Because of these risks and uncertainties, the
forward-looking events and circumstances discussed in this prospectus supplement
and core prospectus might not transpire.
S-2
CONSULTING
AGREEMENT
On
July 31, 2007, Amarin Pharmaceuticals Ireland Ltd., a wholly owned
subsidiary of the Company, and Strategic Pharmaceutical Solutions, Inc. (“SPS”)
entered into the Consulting Agreement pursuant to which SPS provides certain
consulting services to Amarin and its subsidiaries. Under Section
6.3.1.(a), in the event that the parties agree to terminate the Consulting
Agreement under certain circumstances, Amarin will be required to issue to
SPS
immediately exerciseable warrants to purchase 10,000 Ordinary Shares with an
exercise price equal to the closing price of the ADSs on the Nasdaq Capital
Market on the date of approval of such issuance by the board of directors of
Amarin. On November 28, 2007, the board of directors of Amarin
approved the issuance of warrants to purchase 10,000 Ordinary Shares to SPS
in
accordance with Section 6.3.1(a) of the Consulting Agreement. The
closing price of the ADSs on the Nasdaq Capital Market on November 28, 2007
was $0.34 per share. On January 18, 2008, we consummated a 1 for
10 reverse stock split of our Ordinary Shares and our ADSs. See
“Recent Developments—Reverse Stock Split”. Accordingly, we have
adjusted the number of Ordinary Shares issuable upon exercise of the Warrants
specified in the Consulting Agreement from 10,000 Ordinary Shares to 1,000
Ordinary Shares and we have adjusted the Exercise Price calculated as specified
in the Consulting Agreement from $0.34 per share to $3.40 per
share.
S-3
RECENT
DEVELOPMENTS
Acquisition
of Ester
On
December 5, 2007, we entered into a Stock Purchase Agreement (the “Acquisition
Agreement”) with the selling shareholders named therein and the other parties
thereto pursuant to which we will purchase all of the outstanding ordinary
shares of Ester Neurosciences Ltd. (“Ester”), a private pharmaceutical
development company based in Israel (the “Ester Acquisition”). The
acquisition closed on December 6, 2007. Ester’s core assets
include (i) a platform messenger RNA (mRNA) silencing technology which targets
the cholinergic pathway; (ii) EN101, a Phase II compound with promising efficacy
data for the treatment of myasthenia gravis (“MG”) utilising this technology;
and (iii) a preclinical program in neurodegenerative and inflammatory
diseases. Pursuant to the Acquisition Agreement, we have acquired
100% of the issued share capital of Ester for initial consideration of $15
million, of which $5 million is payable in cash and $10 million in Ordinary
Shares, i.e., 25 million Ordinary Shares. Additional contingent
payments, valued at $17 million, are payable to former Ester shareholders on
the
successful completion of certain development-based milestones. This additional
contingent consideration represents:
|
·
|
two
milestone payments totalling $11 million, are payable, at our option,
in
cash or in Ordinary Shares valued at $0.38 per share, the 10-day
volume
weighted average closing price of our ADSs on the Nasdaq Capital
Market on
December 4, 2007 (subject to an adjustment reducing the number of
shares payable to former Ester shareholders if our ADS closing price
on
such milestone date is higher than $0.76 per
share):
|
|
o
|
$5
million is payable no earlier than April 5, 2008 on the achievement
of certain efficacy data on completion of the ongoing Phase IIa study;
and
|
|
o
|
$6
million is due on successful completion of the Phase II program supporting
progression to Phase III in the United States;
and
|
|
·
|
one
cash milestone payment of $6 million is payable on successful completion
of the Phase III program in the United
States.
|
In
addition, pursuant to the Acquisition Agreement we have assumed a single digit
royalty obligation on net product sales of EN101.
Ester
Financing
In
connection with the financing of the Ester Acquisition, on December 6, 2007
we issued (i) 16,290,900 Ordinary Shares, each Ordinary Share represented by
one
ADS, together with warrants to purchase 8,145,446 Ordinary Shares, each Ordinary
Share represented by one ADS (the “Equity Units”), and (ii) $2,750,000 aggregate
principal amount of our 8% Convertible Debentures due 2010, convertible into
5,729,166 Ordinary Shares, together with warrants to purchase 2,291,666 Ordinary
Shares (the “Convertible Units”), in each case to selected investors pursuant to
prospectus supplements and an accompanying core prospectus each dated
December 5, 2007 (the “Ester Financing”).
Each
Equity Unit composed of one Ordinary Share and one warrant to purchase 0.50
of
one Ordinary Share were sold at the negotiated price of $0.33 per
unit. Each Convertible Unit, composed of $1,000 principal amount of
debentures and warrants to purchase 833.33 Ordinary Shares, were sold at the
negotiated price of $1,000 per unit.
The
debentures will be convertible into our ADSs on or after April 6, 2008 at a
conversion price of $0.48 per Ordinary Share, which represents a 30% premium
to
the five-day volume weighted average price of our ADSs on December 3, 2007
of
$0.366 per ADS. The debentures bear an annual interest rate of 8%,
payable quarterly in arrears. The purchasers of the debentures will
also receive five-year warrants to purchase that number of ADSs equal to 40%
of
the ADSs into which the debentures are initially convertible, with an exercise
price of $0.48 per Ordinary Share.
S-4
The
debentures will be required to be repaid from the proceeds of, and the initial
holders of the convertible notes will have the right to participate in, future
financings of the Company, with certain exceptions.
This
prospectus supplement and the accompanying core prospectus do not constitute
an
offer to sell or the solicitation of an offer to buy the Equity Units or the
Convertible Units, which offer and solicitation occurred only pursuant to the
prospectus supplements and accompanying core prospectus referred to
above.
Reverse
Stock Split
As
described in our Report of Foreign Private Issuer on Form 6-K furnished to
the
SEC on December 5, 2007, we announced on December 5, 2007 that we
intended to send notice of a general meeting (“GM”) to our shareholders at which
we will seek approval for a 1 for 10 reverse stock split of our Ordinary Shares;
this notice was sent to our shareholders on December 12, 2007; if approval
of the Ordinary Share stock split is received, our ADSs will also be reverse
split on a 1 for 10 basis. The GM took place on January 17,
2008. To maintain the listing of our ADSs on the Nasdaq Capital
Market, we must maintain a minimum bid share price of the ADSs of $1.00 per
share. In effecting the 1 for 10 reverse stock split, the bid
price of our ADSs now greatly exceeds the minimum bid price requirement of
$1 and thus we expect to regain and sustain compliance with the Nasdaq Capital
Market’s listing requirements. We have received a delisting notice
from Nasdaq and have made an appeal to a hearing panel on the basis of the
our
definitive plan to regain and sustain compliance, including the reverse stock
split.
ProSeed
Offering
Amarin
issued 975,000 Ordinary Shares to ProSeed Capital Holdings CVA (“ProSeed”) on
January 9, 2008 as consideration for services rendered by ProSeed to Amarin
under a collaboration agreement between ProSeed and Amarin Pharmaceuticals
Ireland Limited (the “ProSeed Offering”).
S-5
|
Warrants
Offered
|
Warrants
to purchase 1,000 Ordinary Shares of Amarin, each Ordinary Share
represented by one ADS, evidenced by one ADR.
|
|
|
Exercise
Shares
|
1,000
Ordinary Shares of Amarin, each Ordinary Share represented by one
ADS,
evidenced by one ADR, subject to adjustment pursuant to the terms
of the
Warrants.
|
|
|
Exercise
Price
|
$3.40
per Ordinary Share, subject to adjustment pursuant to the terms of
the
Warrants.
|
|
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Exercise
Period
|
The
original issue date and through and including November 28,
2012.
|
|
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Ordinary
Shares to be outstanding after issuance of the Exercise Shares issuable
upon exercise of the Warrants offered in this Offering
|
14,004,237
Ordinary Shares.
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|
|
Use
of Proceeds
|
We
will not receive any cash proceeds from the issuance of the
Warrants. We have received certain consulting services from SPS
under the Consulting Agreement for which the Warrants comprise a
portion
of the consideration. We currently anticipate using the net
proceeds of the Exercise Shares, if any, primarily for general working
capital, clinical trials, research and development expenses, selling
and
administrative expenses and for potential acquisitions of, or investments
in, complementary businesses, products and technologies. See
“Use of Proceeds” on page S-8.
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|
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Risk
Factors
|
You
should carefully consider the
information set forth under the heading “Risk Factors” in this
prospectus
supplement, as well as the
other information contained or incorporated by reference
in this prospectus supplement
and the accompanying core prospectus,
before making a decision to
invest in the Securities.
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|
|
Nasdaq
Capital Market Symbol
|
AMRN. On
January 18, 2008, we consummated a 1 for 10 reverse stock split of
our Ordinary Shares and our ADSs. See “Recent
Developments—Reverse Stock Split”. Under customary
Nasdaq practice, in connection
with the reverse stock split, a “D” will be appended to Amarin’s
Nasdaq ticker symbol for the
20 trading day period immediately following January 18, 2008,
during
which our Nasdaq ticker symbol
will appear as “AMRND”.
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S-6
RISK
FACTORS
Investing
in the Securities involves risks, including risks relating to our ADSs and
Ordinary Shares. You should carefully consider the risks set forth
described in the Risk Factors section beginning on page 3 of the accompanying
core prospectus, as well as the Risk Factor section of our Annual Report on
Form 20-F for the year ended December 31, 2006, the risk factors set
forth under the heading “Principal Risks and Uncertainties” in our Report of
Foreign Issuer on Form 6-K furnished to the SEC on May 9, 2007 and the updated
Risk Factors section in our Report of Foreign Issuer on Form 6-K furnished
to
the SEC on January 8, 2007 (each of which are incorporated by reference in
the accompanying core prospectus).
The
risks and uncertainties described in these documents are not the only ones
that
we face. Additional risks and uncertainties not presently known to us
or that we currently believe to be immaterial may also adversely affect our
business. If any of the risks and uncertainties develop into actual
events, our business, financial condition and results of operations could be
materially and adversely affected. In such an instance, the trading
price of our ADSs and Ordinary Shares could decline, and you might lose all
or
part of your investment.
S-7
USE
OF PROCEEDS
We
will
not receive any cash proceeds from the issuance of the Warrants. We
have received certain advisory services from SPS under the Consulting Agreement
for which the Warrants comprise a portion of the consideration. We
currently anticipate using the net proceeds of the Exercise Shares, if any,
primarily for general working capital, clinical trials, research and development
expenses, selling and administrative expenses and for potential acquisitions
of,
or investments in, complementary businesses, products and
technologies.
S-8
CAPITALIZATION
AND INDEBTEDNESS
The
following table sets forth, on an International Financial Reporting Standards
(“IFRS”) basis, our capitalization and indebtedness, as of September 30,
2007:
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·
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on
an actual basis;
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·
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pro
forma for the Ester Acquisition, the Ester Financing, the ProSeed
Offering
and the Reverse Stock Split as if they had occurred on September
30,
2007;
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|
·
|
on
an as-adjusted basis to give effect to the sale of 1,000 Ordinary
Shares
issuable upon exercise of the Warrants offered in this offering assuming
all such Exercise Shares are issued and sold pursuant to this
offering.
|
The
capitalization table as adjusted includes the issuance of the debentures in
the
Ester Financing net of the discount associated with the fair value of the
warrants issued in the Ester Financing. Except as otherwise indicated or the
context otherwise requires, the information above and elsewhere in this
prospectus supplement regarding our outstanding Ordinary Shares is based on
97,766,470 shares outstanding as of September 30, 2007.
This
table should be read in conjunction with our consolidated financial statements
for the three years ended December 31, 2006 set forth in our Annual Report
on
Form 20-F for the fiscal year ended December 31, 2006, our Statutory Annual
Report for the year ended December 31, 2006, included in our Report of Foreign
Issuer on Form 6-K furnished to the SEC on May 9, 2007, our selected financial
data for the three month period ended March 31, 2007 included in our Report
of
Foreign Issuer on Form 6-K furnished to the SEC on May 10, 2007, our selected
financial data for the six month period ended June 30, 2007, included in our
Report of Foreign Issuer on Form 6-K furnished to the SEC on August 1, 2007,
our
2007 interim financial statements for the period ended June 30, 2007, included
in our Report of Foreign Issuer on Form 6-K furnished to the SEC on August
14,
2007 and our selected financial data for the nine month period ended September
30, 2007, included in our Report of Foreign Issuer on Form 6-K furnished to
the
SEC on November 20, 2007.
As
at
September 30, 2007, we held $20.735 million of cash balances.
|
Actual
|
Pro
forma for Ester
Acquisition,
the Ester Financing and the ProSeed Offering (1)
|
Adjusted
for
Offering
|
As
Adjusted
|
|||||||||||||
|
$’000
|
||||||||||||||||
|
Long
-term debt issued in Concurrent Offering (net of discount associated
with
warrants issued in Concurrent Offering of $992)
|
— | 1,759 | — | 1,759 | ||||||||||||
|
Shareholders’
equity:
|
||||||||||||||||
|
Called
up share capital
|
8,691 | 14,109 | 1 | 14,110 | ||||||||||||
|
Treasury
shares
|
(217 | ) | (217 | ) | — | (217 | ) | |||||||||
|
Capital
redemption reserve
|
27,633 | 27,633 | — | 27,633 | ||||||||||||
|
Foreign
currency translation reserve
|
(2,087 | ) | (2,087 | ) | — | (2,087 | ) | |||||||||
|
Fair
value investment reserve
|
4 | 4 | — | 4 | ||||||||||||
|
Share
premium account
|
146,241 | 170,421 | 2 | 170,423 | ||||||||||||
|
Profit
and loss account — (deficit)
|
(164,103 | ) | (173,927 | ) | (3 | ) | (173,930 | ) | ||||||||
|
Total
shareholders’ equity
|
16,162 | 35,936 | — | 35,936 | ||||||||||||
|
Total
capitalization
|
16,162 | 37,965 | — | 35,965 | ||||||||||||
________________
(1)
Pro forma information for the Ester Acquisition includes Amarin actual
information as at September 30, 2007 and Ester actual information at June 30,
2007 because no historical financial statements are available for Ester at
September 30, 2007. We believe that there is no material difference between
Ester actual information presented in this table at June 30, 2007 and September
30, 2007.
S-9
DILUTION
Under
IFRS, the net tangible book value of our Ordinary Shares on September 30,
2007 assuming the 1 for 10 reverse split occurred on September 30, 2007, taking
into account the Equity Units and the Convertible Units and the Ordinary Shares
issuable upon the exercise of the warrants offered in the Ester Financing ,in
the case of each of the Ordinary Shares issuable upon the exercise of the
warrants offered in the Ester Financing and shares issued to ProSeed under
a
collaboration agreement, was $15.4 million, or approximately $1.10 per Ordinary
Share, based on 14,003,237 Ordinary Shares outstanding. Net tangible
book value per Ordinary Share represents the amount of our total tangible assets
excluding intangible assets, less our total liabilities, divided by the total
number of our Ordinary Shares outstanding. Dilution in net tangible
book value per Ordinary Share to new investors represents the difference between
the amount per Ordinary Share paid by investors in this offering and the net
tangible book value per Ordinary Share immediately
afterwards. Without taking into account any other changes in net
tangible book value after September 30, 2007, other than to give effect to
issuance of the warrants offered in this offering, our net tangible book value
as of September 30, 2007 after giving effect to the share issuance described
above and assuming the 1 for 10 reverse split occurred at September 30, 2007,
would have been approximately $15.4 million, or $1.10 per Ordinary
Share. This represents an immediate increase in net tangible book
value of $0.00 per Ordinary Share to existing stockholders and an immediate
dilution in net tangible book value of $2.30 per Ordinary Share to
SPS.
The
following table illustrates this per Ordinary Share dilution:
|
Offering
price per Ordinary Share
|
$3.40
|
|
|
Net
tangible book value per Ordinary Share as of September 30,
2007
|
$1.10
|
|
|
Increase
per Ordinary Share attributable to new investors
|
$0.00
|
|
|
As
adjusted net tangible book value per Ordinary Share after issuance
of the
Exercise Shares issuable upon exercise of the Warrants
|
$1.10
|
|
|
Dilution
in net tangible book value per Ordinary Share to new
investors
|
$2.30
|
S-10
PRICE
HISTORY
The
following table sets forth the range of high and low closing sale prices for
our
ADSs for the periods indicated, as reported by the Nasdaq Capital
Market. These prices do not include retail markups, markdowns or
commissions but give effect to a change in the number of Ordinary Shares
represented by each ADS, implemented in both October 1998 and July
2002. Historical data in the table has been restated to take into
account these changes.
|
USD
High
|
USD
Low
|
|
|
Fiscal
Year Ended
|
||
|
December
31, 2002
|
21.00
|
2.76
|
|
December
31, 2003
|
4.81
|
1.39
|
|
December
31, 2004
|
3.99
|
0.53
|
|
December
31, 2005
|
3.40
|
1.06
|
|
December
31, 2006
|
3.92
|
1.21
|
|
Fiscal
Year Ended December 31, 2005
|
||
|
First
Quarter
|
3.40
|
2.14
|
|
Second
Quarter
|
2.36
|
1.06
|
|
Third
Quarter
|
1.67
|
1.32
|
|
Fourth
Quarter
|
1.45
|
1.07
|
|
Fiscal
Year Ended December 31, 2006
|
||
|
First
Quarter
|
3.74
|
1.27
|
|
Second
Quarter
|
3.10
|
1.93
|
|
Third
Quarter
|
2.96
|
2.23
|
|
Fourth
Quarter
|
2.67
|
1.96
|
|
Fiscal
Year Ending December 31, 2007
|
||
|
First
Quarter
|
2.62
|
1.74
|
|
Second
Quarter
|
3.78
|
0.55
|
|
Third
Quarter
|
0.59
|
0.36
|
|
Fourth
Quarter
|
0.45
|
0.23
|
On
January 17, 2008, the closing price of our ADSs as reported on the Nasdaq
Capital Market was $0.23 per ADS. Effective January 18, 2008, we
consummated a 1 for 10 reverse stock split of our Ordinary Shares and our
ADSs. See “Recent Developments—Reverse Stock Split”. On
January 22, 2008, the closing price of our ADSs as reported on the Nasdaq
Capital Market was $2.05 per ADS.
S-11
DESCRIPTION
OF WARRANTS
We
are
offering Warrants (“Warrants”), exerciseable into 1,000 of our Ordinary Shares
in the form of ADSs to Strategic Pharmaceutical Solutions, Inc. (“SPS”) pursuant
to this prospectus supplement and the accompanying prospectus in consideration
for certain consulting services pursuant to the Consulting Agreement, dated
as of
July 31, 2007, by and among the Amarin Pharmaceuticals Ireland Ltd., a
wholly owned subsidiary of the Company, and SPS. See
Consulting Agreement. The Warrants will be exerciseable at the price
of $3.40 per Ordinary Share (subject to adjustment as described
below). The Warrants may be exercised at any time and from time to
time on or after the original issue date and through and including
November 28, 2012. A description of the material terms of the
Warrants to be issued are described below.
Exercise. The
rights represented by the Warrant may be exercised in whole or, subject to
the
limitations set forth below, in part at any time during the Exercise Period,
by
delivery at least ten (10) days prior to the date of exercise of the following
to the Company at its address set forth in the Warrant (or at such other address
as it may designate by notice in writing to the holder):
(a)
An executed Notice of Exercise in the form attached to the Warrant;
(b)
Payment of the Exercise Price by wire transfer of immediately available funds;
and
(c)
The Warrant (together with each duly completed Assignment Form (in the form
attached to the Warrant) in respect of each assignment of the Warrant, if any,
subsequent to the date the Warrant is issued).
Upon
the
exercise of the rights represented by the Warrant, ADRs will be issued for
the
Exercise Shares so purchased, and will be registered in the name of the holder
or persons affiliated with the holder, if the holder so designates, reasonably
promptly after the rights represented by the Warrant shall have been so
exercised and shall be issued and delivered to the holder through the book-entry
facilities of The Depository Trust Company, unless the holder specifies
otherwise. The issuance of Exercise Shares upon exercise of the Warrant will
be
made without charge to the holder for any stamp duty or stamp duty reserve
tax
with respect thereto or any other cost incurred by us in connection with the
exercise of the Warrant and the related issuance of Exercise
Shares.
The
Warrants may be exercised in part; provided that no exercise
of
the Warrants may be in respect of less than 500 Exercise Shares; provided, further,
that if the Warrant
is, upon issuance, exercisable for less than 500 Exercise Shares, the Warrant
may be exercised in whole but not in part and provided further that, after
giving effect to such exercise, the number of Exercise Shares relating to
unexercised Warrants is equal to or exceeds 500. Warrants may not be
exercised for a fractional Exercise Share.
Adjustment
of Exercise
Price. In the event of any changes in our outstanding Ordinary
Shares on or after January 25, 2008 by reason of a stock dividend,
subdivision, split-up, or combination of shares, the number of Ordinary Shares
purchasable under the Warrant in the aggregate and the Exercise Price shall
be
correspondingly adjusted to give the holder of the Warrant, on exercise for
the
same aggregate Exercise Price, the total number of Ordinary Shares as the holder
would have owned had the Warrant been exercised prior to the event requiring
adjustment and had the holder continued to hold such shares until after such
event.
If,
for
any reason, prior to the exercise of the Warrant in full, we spin off or
otherwise divest ourselves of a part of our business or operations or dispose
of
all or a part of our assets in a transaction (the “Spin Off”), in each case, in
a transaction in which we do not receive compensation for such business,
operations or assets, but causes securities of another entity (the “Spin Off
Securities”) to be issued to our security holders, then the Exercise Price on
the outstanding Warrant will be adjusted immediately after consummation of
the
Spin Off by multiplying the Exercise Price in effect immediately prior to the
Spin Off by a fraction (if, but only if, such fraction is less than 1.0), the
numerator of which is the average closing bid price of the ADSs for the five
trading days immediately following the fifth trading day after the record date
(the “Record Date”) for determining the amount and number of Spin Off Securities
to be issued to our security holders, and the denominator of which is the
average closing bid price of the ADSs
S-12
for
the
five trading days immediately preceding the Record Date; and such adjusted
Exercise Price shall be deemed to be the Exercise Price with respect to the
outstanding Warrant after the consummation of the Spin Off.
Certain
Events. In the event of, at any time on or after June 21,
2007 and prior to the expiration of the Exercise Period, any capital
reorganization, or any reclassification of our capital stock (other than a
change in par value or from par value to no par value or no par value to par
value or as a result of a stock dividend, subdivision, split-up or combination
of shares), or our consolidation or merger with or into another corporation
(other than a merger solely to effect a reincorporation of Amarin into another
state), in each case, in which our shareholders immediately prior to such
capital reorganization, reclassification, consolidation or merger, will hold
less than a majority of our outstanding shares or the outstanding shares of
the
resulting corporation immediately after such capital reorganization,
reclassification, consolidation or merger, or the sale or other disposition
of
all or substantially all of our properties and assets, taken as a whole, in
its
entirety to any other person, other than sales or other dispositions that do
not
require shareholder approval (each, an “Event”), we will provide to the holder
ten (10) days' advance written notice of such Event, and the holder shall have
the option, in its sole discretion, to allow any unexercised portion of the
Warrants to be deemed automatically exercised.
No
Shareholder
Rights. The Warrants in and of themselves will not entitle the
holder of the Warrants to any voting rights or other rights as a shareholder
of
the Company.
Transfers
of the
Warrants. The Warrants and all rights thereunder are
transferable, by the holder in person or by duly authorized attorney, upon
delivery of the Warrants and the Assignment Form attached thereto to any
authorized transferee designated by the holder with a copy to the
Company..
Modifications
and
Waiver. Unless otherwise provided in the Warrants, the
Warrants and any provision thereof may be changed, waived, discharged or
terminated only by an instrument in writing signed by the Company and the
holder.
CERTAIN
U.S. FEDERAL INCOME TAX CONSIDERATIONS
Subject
to the limitations described below, the following generally summarizes certain
material U.S. federal income tax consequences to a U.S. Holder (as
defined below) of the acquisition, ownership and disposition of Warrants and
Ordinary ShaAres. U.S. Holders of ADSs will be treated for
U.S. federal income tax purposes as owners of the Ordinary Shares
underlying the ADSs. Accordingly, except as noted, the
U.S. federal income tax consequences discussed below regarding Ordinary
Shares apply equally to ADSs. This discussion is limited to
U.S. Holders who are beneficial owners of the Warrants or Ordinary Shares,
and who hold their Warrants or Ordinary Shares as capital assets, within the
meaning of the U.S. Internal Revenue Code of 1986, as amended, which we
refer to as the “Code.” For purposes of this summary, a
“U.S. Holder” is a beneficial owner of Warrants or Ordinary Shares that
does not maintain a “permanent establishment” or “fixed base” in the U.K., as
such terms are defined in the double taxation convention between the U.S. and
U.K. and that is, for U.S. federal income tax purposes,
|
·
|
an
individual who is a citizen or resident of the
U.S.;
|
|
·
|
a
corporation (or other entity
treated as a corporation for U.S. federal
income tax purposes)
created or organized
in the U.S. or
under the laws of the
U.S. or
of any state thereof or
the District of
Columbia;
|
|
·
|
an
estate, the income of which is
includible in gross income for U.S. federal income tax purposes
regardless of its
source; or
|
|
·
|
a
trust, (i) if
a court within the U.S. is
able to exercise primary supervision over the administration of the
trust
and one or more U.S. persons have the authority to control all
substantial decisions of the trustor (ii) if
it made a valid
election to be treated as a U.S. person.
|
If
a
partnership (including for this purpose any entity treated as a partnership
for
U.S. federal income tax purposes) is a beneficial owner of Warrants or
Ordinary Shares, the treatment of a partner in the partnership will generally
depend upon the status of the partner and the activities of the
partnership. Partnerships and partners in such partnerships should
consult their tax advisors about the U.S. federal income tax consequences
of owning and disposing of Warrants or Ordinary Shares.
S-13
This
summary is for general information purposes only. It does not purport
to be a comprehensive description of all the U.S. federal income tax
considerations that may be relevant to each U.S. Holder’s decision in
regard to the Warrants and Ordinary Shares. This discussion also does
not address any aspect of U.S. federal gift or estate tax, or any state,
local or non-U.S. tax laws. Prospective owners of Warrants or
Ordinary Shares who are U.S. Holders are advised to consult their own tax
advisors with respect to the U.S. federal, state and local tax
consequences, as well as the non-U.S. tax consequences, of the acquisition,
ownership and disposition of Warrants and Ordinary Shares applicable to their
particular tax situations.
This
discussion is based on current provisions of the Code, current and proposed
U.S. Treasury regulations promulgated thereunder, the double taxation
convention between the U.S. and U.K. entered into force on March 31, 2003,
and administrative and judicial decisions, each as of the date hereof, all
of
which are subject to change or differing interpretation, possibly on a
retroactive basis. The new convention replaces the double taxation
convention between the U.S. and the U.K. entered into force on April 24,
1980. The new convention is effective, in respect of taxes withheld
at source, for amounts paid or credited on or after May 1,
2003. Other provisions of the new convention will take effect on
certain other dates. A U.S. Holder would, however, be entitled
to elect to have the old convention apply in its entirety for a period of twelve
months after the effective dates of the new convention. The following
discussion assumes that U.S. Holders are residents of the U.S. for
purposes of both the old convention and the new convention, and are entitled
to
the benefits of those conventions.
This
discussion does not address all aspects of U.S. federal income taxation
that may be relevant to a particular U.S. Holder based on such holder’s
individual circumstances. In particular, this discussion does not
address the potential application of the alternative minimum tax nor does it
address the tax treatment of shareholders, partners or beneficiaries of a holder
of Warrants or Ordinary Shares. In addition, this discussion does not
address the U.S. federal income tax consequences to U.S. Holders that
are subject to special treatment, including broker-dealers, including dealers
in
securities or currencies; insurance companies; U.S. Holders that have elected
mark-to-market accounting; tax-exempt organizations; financial institutions
or
“financial services entities”; taxpayers who hold Warrants or Ordinary Shares as
part of a straddle, hedge or conversion transaction; U.S. Holders owning
directly, indirectly or by attribution at least 10% of our voting power;
taxpayers whose functional currency is not the U.S. Dollar; certain
expatriates or former long-term residents of the U.S.; and taxpayers who
acquired their Warrants or Ordinary Shares as compensation.
You
should consult your own tax advisors about the particular tax consequences
to
you under U.K., U.S. federal, state and local and other foreign laws, of
the acquisition, ownership and disposition of Warrants, ADSs or Ordinary
Shares.
Warrants
Exercise
of Warrants
The
exercise of a Warrant will not be a taxable event for a U.S.
Holder. Subject to the
passive foreign investment
company rules discussed
below, a U.S. Holder will generally have a holding period in ADSs
acquired upon exercise of a Warrant that begins on the day after the date of
exercise of the Warrant.
Lapse
of Warrants
If
a
Warrant is allowed to lapse unexercised, a U.S. Holder would realize a capital
loss equal to such holder’s tax basis in the Warrant. U.S. Holders of
Warrants should consult their own tax advisors regarding the amount of their
tax
basis in the Warrants.
Sale
or Exchange of Warrants
Subject
to the passive foreign investment company rules discussed below, the sale of
a
Warrant will result in the recognition of capital gain or loss to a U.S. Holder
in a manner similar to that described below under “—Sale or Exchange of Ordinary
Shares.”
S-14
Constructive
Distributions
An
adjustment to the exercise price or conversion ratio of the Warrants, or the
failure to make such adjustments, may in certain circumstances result in
constructive distributions to U.S. Holders that could be taxable as
dividends under Section 305 of the Code. In that case, the U.S.
Holder’s tax basis in the Warrants would be increased by the amount of any such
dividend.
Ordinary
Shares
Distributions
Subject
to the PFIC rules discussed below, the amount of any distributions (including,
provided certain elections are made, as discussed in “—U.K. Withholding
Tax/Foreign Tax Credits” below, the full tax credit amount deemed received) paid
out of current and/or accumulated earnings and profits, as determined under
U.S. tax principles, will be included in the gross income of a
U.S. Holder on the day such distributions are actually or constructively
received, and will be characterized as ordinary income for U.S. federal
income tax purposes. Dividends paid to noncorporate holders in
taxable years beginning before January 1, 2011 are subject to taxation at a
reduced rate of 15% provided that the holder has held the shares for more than
60 days during the 120-day period beginning 60 days before the
ex-dividend date, the issuer is a “qualified foreign corporation,” and certain
other conditions are met. A company is a “qualified foreign
corporation” if the shares on which the dividend is paid (or ADSs in respect of
such shares) are listed on certain securities markets, including the Nasdaq
Stock Market, or if the corporation is eligible for the benefits of a tax treaty
determined to be satisfactory by the U.S. Secretary of the
Treasury. The income tax treaty between the U.S. and the U.K. has
been designated as satisfactory for such purpose.
To
the
extent that a distribution on Ordinary Shares exceeds our current and
accumulated earnings and profits, it will be treated as a non-taxable return
of
capital to the extent of a U.S. Holder’s adjusted basis in the Ordinary
Shares, and thereafter as capital gain. We do not currently maintain
calculations of our earnings and profits under U.S. tax
principles. Dividends paid by us to corporate U.S. Holders will
not be eligible for the dividends-received deduction that might otherwise be
available if such dividends were paid by a U.S. corporation.
Foreign
Currency Considerations
Distributions
paid by us in pounds sterling will be included in a U.S. Holder’s income
when the distribution is actually or constructively received by the
U.S. Holder. The amount of a dividend distribution includible in
the income of a U.S. Holder will be the U.S. Dollar value of the
pounds sterling, determined by the spot rate of exchange on the date when the
distribution is actually or constructively received by the U.S. Holder,
regardless of whether the pounds sterling are actually converted into
U.S. Dollars at such time. If the pounds sterling received as a
dividend distribution are not converted into U.S. Dollars on the date of
receipt, a U.S. Holder may realize exchange gain or loss on a subsequent
conversion of such pounds sterling into U.S. Dollars. The amount
of any gain or loss realized in connection with a subsequent conversion will
be
treated as ordinary income or loss, and generally will be treated as
U.S. source income or loss for foreign tax credit purposes.
U.K.
Withholding Tax/Foreign Tax Credits
A
U.S. Holder that elects to receive benefits under the old convention is, in
principle, entitled to claim a refund from the Revenue and Customs for
(i) the amount of the tax credit that a U.K. resident individual would be
entitled to receive with respect to a dividend payment, which we refer to as
the
“Tax Credit Amount,” reduced by (ii) the amount of U.K. withholding tax,
which we refer to as “U.K. Notional Withholding Tax,” imposed on such dividend
payment under the old convention. The Tax Credit Amount will equal
that amount of U.K. Notional Withholding Tax imposed on dividends paid by
us. As a result, no such refund is available. However, a
U.S. Holder may be entitled to claim a foreign tax credit for the amount of
U.K. Notional Withholding Tax associated with a dividend paid by us by
filing a Form 8833 in accordance with U.S. Revenue Procedure 2000-13.
U.S. Holders that file Form 8833 will be treated as receiving an
additional dividend from us equal to the Tax Credit Amount (unreduced by the
U.K. Notional Withholding Tax). Such additional dividend must be
included in the U.S. Holder’s gross income, and the U.S. Holder will be
treated as having paid the applicable U.K. Notional Withholding Tax due
under
S-15
the
old
convention. For purposes of calculating the foreign tax credit,
dividends paid on the Ordinary Shares will be treated as non-U.S. source
income, and generally will constitute “passive category income” or, in the case
of certain U.S. Holders, “general category income.” In lieu of
claiming a foreign tax credit, a U.S. Holder may be eligible to claim a
deduction for foreign taxes paid
in a taxable year. However,
a deduction generally does not
reduce a U.S. Holder’s
U.S. federal income tax liability
on a dollar-for-dollar
basis as does a tax credit.
Under
the
new convention, the Tax Credit Amount and U.K. Notional Withholding Tax
described above will no longer apply to U.S. Holders. The U.K.
does not currently apply a withholding tax on dividends under its internal
tax
laws. Were such withholding imposed in the U.K., as permitted under
the new convention, the U.K. generally will be entitled to impose a withholding
tax at a rate of 15% on dividends paid to U.S. Holders. A
U.S. Holder who is subject to such withholding should be entitled to a
credit for such withholding, subject to applicable limitations, against such
U.S. Holder’s U.S. federal income tax liability.
The
rules
relating to foreign tax credits are complex. U.S. Holders are
urged to consult their tax advisors to determine whether and to what extent
a
foreign tax credit might be available in connection with dividends paid on
the
Ordinary Shares.
Sale
or Exchange of Ordinary Shares
Subject
to the PFIC rules described below, a U.S. Holder generally will recognize
capital gain or loss on the sale or exchange of Ordinary Shares in an
amount equal to the difference between the amount realized in such sale or
exchange and the U.S. Holder’s adjusted tax basis in such Ordinary
Shares. Such capital gain or loss will be long-term capital gain or
loss if a U.S. Holder has held the Ordinary Shares for more than one year,
and generally will be U.S. source income for foreign tax credit
purposes. Long-term capital gains realized by an individual
U.S. Holder on a sale or exchange of Ordinary Shares are generally subject
to reduced rates of taxation. The deductibility of capital losses is
subject to limitations.
A
U.S. Holder that receives foreign currency upon the sale or exchange of
Ordinary Shares generally will realize an amount equal to the
U.S. Dollar value of the foreign currency on the date of sale (or, if
Ordinary Shares are traded on an established securities market, in the case
of
cash basis tax payers and electing accrual basis tax payers, the settlement
date). A U.S. Holder will have a tax basis in the foreign
currency received equal to the U.S. Dollar amount realized. Any
gain or loss realized by a U.S. Holder on a subsequent conversion or other
disposition of foreign currency will be ordinary income or loss, and will
generally be U.S. source income for foreign tax credit purposes.
Surrender
of ADSs for Ordinary
Shares
The
surrender of ADSs for the underlying Ordinary Shares will not be a taxable
event
for U.S. federal income tax purposes, and U.S. Holders will not
recognize any gain or loss upon such an exchange.
PFIC
Rules
Certain
adverse U.S. tax consequences apply to a U.S. shareholder in a company
that is classified as a passive foreign investment company, which is referred
to
herein as a PFIC. We will be classified as a PFIC in a particular
taxable year if either (i) 75% or more of our gross income is passive
income; or (ii) the average percentage of the value of our assets that
produce or are held for the production of passive income is at least
50%. Cash balances, even if held as working capital, are considered
to be passive.
Because
we will receive interest income and may receive royalties, we may be classified
as a PFIC under the income test described above. In addition, as a
result of our cash position, we may be classified as a PFIC under the asset
test.
If
we
were a PFIC in any year during which a U.S. Holder owned Ordinary Shares,
the U.S. Holder would generally be subject to special rules (regardless of
whether we continued to be a PFIC) with respect to (i) any “excess
distribution” (generally, distributions received by the U.S. Holder in a
taxable year in excess of 125% of the
S-16
average
annual distributions received by such holder in the three preceding taxable
years, or, if shorter, such holder’s holding period) and (ii) any gain
realized on the sale or other disposition of the Ordinary
Shares. Under these rules:
|
·
|
the
excess distribution or gain
would be allocated ratably over the U.S. Holder’s
holding period, including
the holding period
that the U.S. Holder owned the Warrants;
|
|
·
|
the
amount allocated to the
current taxable year and any taxable year prior to the first taxable
year
in which we are a PFIC would be taxed as ordinary
income; and
|
|
·
|
the
amount allocated to each of the prior taxable years would be subject
to
tax at the highest rate of tax in effect for the taxpayer for that
year,
and an interest charge for the deemed deferral benefit would be imposed
with respect to the resulting tax attributable to each such prior
taxable
year.
|
U.S. Holders
who own ADSs (but not Ordinary Shares) generally should be able to avoid the
interest charge described above by making a mark-to-market election with respect
to such ADSs, provided that the ADSs are “marketable.” The ADSs are
marketable if they are regularly traded on certain U.S. stock exchanges, or
on a foreign stock exchange if:
|
·
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the
foreign exchange is regulated
or supervised by a governmental authority of the country in which
the
exchange
is
located;
|
|
·
|
the
foreign exchange has trading
volume, listing, financial disclosure, and other requirements designed
to
prevent fraudulent and manipulative acts and practices, remove impediments
to, and perfect the mechanism of, a free and open market, and to
protect
investors;
|
|
·
|
the
laws of the country in which
the exchange is located and the rules of the exchange ensure that
these
requirements
are actually
enforced; and
|
|
·
|
the
rules of the exchange
effectively promote active trading of listed
stocks.
|
For
purposes of these regulations, the ADSs will be considered regularly traded
during any calendar year during which they are traded, other than in de minimis
quantities, on at least fifteen days during each calendar
quarter. Any trades that have as their principal purpose meeting this
requirement will be disregarded. If a U.S. Holder makes a
mark-to-market election, it will be required to include as ordinary income
the
excess of the fair market value of such ADSs at year-end over its basis in
those
ADSs. In addition, any gain that the U.S. Holder recognizes upon the
sale of such ADSs will be taxed as ordinary income in the year of
sale. A U.S. Holder of Warrants may not make a mark-to-market
election with respect to the Warrants it
holds. U.S. Holders should consult their tax advisors
regarding the availability of the mark-to-market election.
A
U.S. Holder of an interest in a PFIC can sometimes avoid the interest
charge described above by making a “qualified electing fund” or “QEF” election
to be taxed currently on its share of the PFIC’s undistributed ordinary
income. Such election must be based on information concerning the
PFIC’s earnings provided by the relevant PFIC to investors on an annual basis.
We will make such information available to U.S. Holders upon request, and
consequently U.S. Holders will be able to make a QEF election. A
U.S. Holder may not make a QEF election with respect to Warrants. As
a result, if a U.S. Holder sells Warrants, any gain will be subject to the
special tax and interest charge rules treating the gain as an excess
distribution, as described above, if the company is a PFIC at any time during
the period the U.S. Holder holds the Warrants. If a U.S. Holder that
exercises Warrants properly makes a QEF election with respect to the newly
acquired ADSs, the adverse tax consequences under PFIC rules will continue
to
apply with respect to the pre-QEF election period.
The
application of the PFIC and QEF rules to Warrants and to ADSs acquired upon
exercise of Warrants is subject to significant
uncertainties. Accordingly, each U.S. Holder should consult such
holder’s tax advisor concerning the PFIC consequences of holding Warrants or of
holding ADSs acquired through the exercise of such Warrants. In
addition, U.S. Holders who hold ADSs or Ordinary Shares other than through
exercise of Warrants should consult their tax advisors regarding the
U.S. federal income tax considerations discussed above and the desirability
of making a QEF election.
S-17
U.S. Backup
Withholding and Information Reporting Requirements
Dividends
paid on the Ordinary Shares, and proceeds received in connection with the sale
or exchange of Ordinary Shares or Warrants may be subject to information
reporting to the Internal Revenue Service (the “IRS”) and backup withholding
(currently imposed at a rate of 28%). Backup withholding will not
apply, however, if a U.S. Holder (i) is a corporation or comes within
certain other exempt categories and, when required, demonstrates such fact,
or
(ii) provides a taxpayer identification number, certifies as to no loss of
exemption from backup withholding and otherwise complies with applicable backup
withholding rules. Persons required to establish their exempt status
generally must provide certification on IRS Form W-9 or Form W-8BEN
(as applicable). Amounts withheld as backup withholding may be
credited against a holder’s U.S. federal income tax liability. A
holder may obtain a refund of any excess amounts withheld under the backup
withholding rules by filing the appropriate claim for refund with the IRS and
timely furnishing any required information.
S-18
The
Warrants offered hereby are being issued directly to SPS on or about
January 25, 2008 and the Exercise Shares, if any issued upon exercise of
the Warrants offered in this offering will be issued directly to SPS or its
assigns. No underwriters, agents, brokers or dealers were involved in
the distribution of the Warrants offered hereby and none will be involved in
the
distribution of the Exercise Shares. No discounts, commissions,
concessions or other compensation has been paid to any underwriter, broker,
dealer or agent in connection with the offering.
LEGAL
MATTERS
Cahill
Gordon & Reindel LLP
will pass upon certain U.S. federal legal matters with respect to the offering
for us.
The
SEC
allows us to incorporate by reference documents we file with the SEC, which
means that we can disclose information to you by referring you to those
documents. The information incorporated by reference is considered to
be part of this prospectus supplement, and certain later information that we
file with the SEC will automatically update and supersede this
information. We incorporate by reference the following documents into
this prospectus supplement:
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·
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our
Annual Report on Form 20-F for the fiscal year ended December 31,
2006
and
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·
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our
Reports of Foreign Private Issuer on Form 6-K furnished to the SEC
on
January 25, 2007, February 5, 2007, February 8, 2007, February 27,
2007,
March 6, 2007, March 9, 2007, March 13, 2007, April 3, 2007, April
10,
2007, April 24, 2007, May 9, 2007 (regarding our grant of stock options
to
Professor William Hall), May 10, 2007, June 1, 2007 (regarding our
equity
credit agreement), June 4, 2007, June 8, 2007, June 19, 2007, July
19,
2007, August 1, 2007, August 14, 2007, September 24, 2007, October
10,
2007, November 19, 2007, November 20, 2007, November 29, 2007, December
5,
2007 (including the Report of Foreign Issuer on Form 6-K as amended
on
Form 6-K/A on December 12, 2007, December 17, 2007), December 19,
2007, January 8, 2008, January 9, 2008, January 10, 2008,
January 17, 2008 and January 18,
2008.
|
All
Annual Reports on Form 20-F that we file with the SEC pursuant to the Securities
Exchange Act of 1934 after the date of this prospectus supplement and prior
to
the termination of the offering shall be deemed to be incorporated by reference
into this prospectus supplement and to be part hereof from the date of filing
of
such documents. We may incorporate by reference any Report of Foreign Private
Issuer on Form 6-K subsequently furnished to the SEC by identifying in such
Form
that it is being incorporated by reference into this prospectus
supplement.
We
shall
undertake to provide without charge to each person to whom a copy of this
prospectus supplement has been delivered, upon the written or oral request
of
any such person to us, a copy of any or all of the documents referred to above
that have been or may be incorporated into this prospectus supplement by
reference, including exhibits to such documents, unless such exhibits are
specifically incorporated by reference to such documents. Requests for such
copies should be directed to Amarin Corporation plc, 1st Floor, Block 3, The
Oval, Shelbourne Road, Ballsbridge, Dublin 4, Ireland, Attention: Company
Secretary, telephone +353-1-6699020
S-19
We
file
reports, including annual reports on Form 20-F, and other information with
the SEC pursuant to the rules and regulations of the SEC that apply to foreign
private issuers. You may read and copy any materials filed with the
SEC at its Public Reference Room at 450 Fifth Street, N.W., Washington, D.C.
20549. You may obtain information on the operation of the Public
Reference Room by calling the SEC at 1-800-SEC-0330. The registration
statement of which this prospectus supplement is a part, and our other public
filings with the SEC, are also available on the website maintained by the SEC
at
http://www.sec.gov.
S-20
$100,000,000
AMARIN
CORPORATION PLC
Ordinary
Shares
Ordinary
Shares, in the form of American Depositary Shares
Preference
Shares
Preference
Shares, in the form of American Depositary Shares
Debt
Securities
Warrants
Purchase
Contracts
Units
and
Guarantees of Debt Securities
AMARIN
FINANCE LTD.
Debt
Securities
We
may
offer and sell from time to time:
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ordinary
shares, each of which may be represented by one American Depositary
Share;
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·
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preference
shares, each of which may be represented by one American Depositary
Share;
|
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·
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warrants
to purchase any other securities that may be sold under this prospectus,
securities of third parties or other
rights;
|
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·
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purchase
contracts to purchase ordinary shares or other securities that may
be sold
under this prospectus;
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·
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any
combination of these securities, individually or as units;
and
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·
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senior
or subordinated debt securities.
|
Amarin
Finance may offer and sell from time to time senior or subordinated debt
securities which we will guarantee.
We
will
provide the specific terms and initial public offering prices of these
securities in supplements to this prospectus. You should read this
prospectus and the accompanying prospectus supplement carefully before you
invest.
We
may
offer securities through underwriting syndicates managed or co-managed by one
or
more underwriters or dealers, through agents or directly to
purchasers. The prospectus supplement for each offering of securities
will describe in detail the plan of distribution for that
offering. For general information about the distribution of
securities offered, please see “Plan of Distribution” in this
prospectus.
Our
American Depositary Shares representing ordinary shares, evidenced by American
Depositary Receipts, are traded on the Nasdaq Capital Market, the principal
trading market for our securities, under the symbol “AMRN.” Our
ordinary shares have also recently been admitted to listing on the AIM market
of
the London Stock Exchange and the IEX market of the Irish Stock
Exchange. If we decide to list any of these other securities on a
national securities exchange upon issuance, the applicable prospectus supplement
to this prospectus will identify the exchange and the date when we expect
trading to begin.
SEE
“RISK FACTORS” REFERRED TO ON PAGE 3 TO READ ABOUT FACTORS YOU SHOULD CONSIDER
BEFORE BUYING THE SECURITIES.
NEITHER
THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION
HAS
APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS
OR
THE ACCOMPANYING PROSPECTUS SUPPLEMENT IS TRUTHFUL OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
Neither
the Bermuda Monetary Authority nor the Registrar of Companies in Bermuda accepts
any responsibility for the financial soundness of Amarin Finance or the
correctness of any of the statements made or opinions expressed in this
prospectus.
This
prospectus may not be used to consummate sales of securities unless accompanied
by the applicable prospectus supplement.
The
date
of this prospectus is July 12, 2006
TABLE
OF CONTENTS
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Page
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1
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AMARIN
CORPORATION PLC
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2
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AMARIN
FINANCE LTD.
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2
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RISK
FACTORS
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3
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FORWARD-LOOKING
STATEMENTS
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16
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PRESENTATION
OF FINANCIAL INFORMATION
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18
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INCORPORATION
BY REFERENCE
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19
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WHERE
YOU CAN FIND MORE INFORMATION
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20
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ENFORCEABILITY
OF CIVIL LIABILITIES
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20
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USE
OF PROCEEDS
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20
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RATIO
OF EARNINGS TO FIXED CHARGES AND RATIO OF EARNINGS TO COMBINED FIXED
CHARGES AND PREFERENCE SHARE DIVIDENDS
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21
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CAPITALIZATION
AND INDEBTEDNESS
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21
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PRICE
HISTORY
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23
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DESCRIPTION
OF DEBT SECURITIES AND GUARANTEES
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24
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DESCRIPTION
OF ORDINARY SHARES
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33
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DESCRIPTION
OF PREFERENCE SHARES
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35
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DESCRIPTION
OF AMERICAN DEPOSITARY SHARES
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37
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CERTAIN
PROVISIONS OF ENGLISH LAW AND OF THE COMPANY’S MEMORANDUM AND ARTICLES OF
ASSOCIATION
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44
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DESCRIPTION
OF WARRANTS
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45
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DESCRIPTION
OF PURCHASE CONTRACTS
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46
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DESCRIPTION
OF UNITS
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47
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TAXATION
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47
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PLAN
OF DISTRIBUTION
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47
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EXPERTS
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49
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LEGAL
MATTERS
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50
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DISCLOSURE
OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT
LIABILITIES
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50
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-i-
ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement on Form F-3 that Amarin and
the other registrants filed with the Securities and Exchange Commission (or
the
SEC) using a “shelf” registration process. Under this process, we
may, from time to time, sell the securities described in this prospectus in
one
or more offerings up to a total dollar amount of $100 million or the equivalent
denominated in foreign currencies.
This
prospectus provides you with a general description of the securities that we
may
offer and the related guarantees, if any, of those securities. Each
time we sell securities, we will provide a prospectus supplement that will
contain specific information about the terms of the offering. This
prospectus will be filed with the Registrar of Companies in Bermuda in
accordance with Bermuda law. The prospectus supplement may also add,
update or change information contained in this prospectus, and may also contain
information about any material federal income tax considerations relating to
the
securities covered by the prospectus supplement. You should read both
this prospectus and any prospectus supplement, together with additional
information described below under the heading “Where You Can Find More
Information,” before purchasing any of our securities. This
prospectus does not contain all of the information included in the registration
statement. For a more complete understanding of the offering of the
securities, you should refer to the registration statement, including the
exhibits.
You
should rely only on the information contained in or incorporated by reference
in
this prospectus and any prospectus supplement. We have not authorized
anyone to provide you with different information. We are not making
offers to sell the securities in any jurisdiction in which an offer or
solicitation is not authorized or in which the person making such offer or
solicitation is not qualified to do so or to anyone to whom it is unlawful
to
make an offer or solicitation.
The
information in this prospectus is accurate as of the date on the front
cover. You should not assume that the information contained in this
prospectus is accurate as of any other date.
Unless
the context otherwise requires, in this prospectus, “Amarin,” “Company,” “we,”
“us” and “our” refer to Amarin Corporation plc and its consolidated
subsidiaries. References to “Amarin Finance” refer to Amarin Finance
Ltd. and references to “Amarin Neuroscience” refer to Amarin Neuroscience
Limited. References to “U.S. dollars,” “USD” or “$” are to the lawful
currency of the United States, references to “euros” or “€” are to the lawful
currency of the member states of the European Economic and Monetary Union and
references to “pounds sterling,” “GBP” or “£” are to the lawful currency of the
United Kingdom.
1
Amarin
is
a neuroscience company focused on the research, development and
commercialization of novel drugs for the treatment of central nervous system
disorders. Our goal is to capitalize on our reputation in neurology
and to become a leader in the development and commercialization of novel drugs
which address unmet medical needs.
Amarin
was incorporated in England as a private limited company on March 1, 1989 under
the Companies Act of 1985, a statute governing companies in Great Britain,
and
re-registered in England as a public limited company on March 19,
1993. Our registered office and our principal executive offices are
located at 7 Curzon Street, Mayfair, London W1J 5HG, England, and our telephone
number is +44-20-7499-9009. Our website address is
www.amarincorp.com. Information contained in our website is not a
part of this prospectus.
AMARIN
FINANCE LTD.
Amarin
has organized Amarin Finance for the purpose of issuing debt securities pursuant
to this prospectus. There are no separate financial statements of
Amarin Finance in this prospectus because it is a subsidiary of Amarin for
financial reporting purposes. We do not believe the financial
statements would be helpful to the holders of the securities of Amarin Finance
because:
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·
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Amarin
is a reporting company under the Securities Exchange Act of 1934,
as
amended (referred to in this prospectus as the “Exchange Act”) and owns,
directly or indirectly, all of the voting interests of Amarin
Finance;
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·
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Amarin
Finance does not have any independent operations and does not propose
to
engage in any activities other than issuing securities and investing
the
proceeds in Amarin or its affiliates;
and
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·
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Amarin
Finance’s obligations under the securities will be fully and
unconditionally guaranteed by
Amarin.
|
Amarin
Finance is exempt from the information reporting requirements of the Exchange
Act.
Amarin
Finance is a Bermuda exempted company limited by shares that was formed under
the Bermuda Companies Act 1981 on June 23, 2006. Its registered
office is at Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda, and
its
telephone number is +441-295-1422.
2
RISK
FACTORS
Investing
in our
securities involves risks. You should carefully consider the risk
factors described below and the other information included or incorporated
by
reference in this prospectus and the accompanying prospectus supplement before
making an investment decision. The risks and uncertainties described
in the risk factors are not the only ones that we face. Additional
risks and uncertainties not presently known to us or that we currently believe
to be immaterial may also adversely affect our business. If any of
the risks and uncertainties mentioned in the risk factors develop into actual
events, our business, financial condition and results of operations could be
materially and adversely affected. In such an instance, the trading
price of our securities could decline, and you might lose all or part of your
investment. Additional risk factors may be included in a prospectus
supplement relating to a particular series or offering of
securities.
We
have a history of losses, and we may not be able to attain profitability in
the
foreseeable future.
We
have
not been profitable in four of the last five fiscal years. For the
fiscal years ended December 31, 2001, 2002, 2003, 2004, and 2005 we reported
(losses)/profits of approximately $(5.3) million, $(37.0) million, $(19.2)
million, $4.0 million and ($18.7) million, respectively, under UK
GAAP. For the quarter ended March 31, 2006, we reported losses of
approximately $(6.4) million under UK GAAP. Unless and until
marketing approval is obtained from either the U.S. Food and Drug
Administration, which we refer to as the FDA, or European Medicines Evaluation
Agency, which we refer to as the EMEA, for our principal product, MiraxionTM,
or we
are otherwise able to acquire rights to products that have received regulatory
approval or are at an advanced stage of development and can be readily
commercialized, we may not be able to generate revenues in future periods and
we
may not be able to attain profitability.
By
February 2004, we had divested a majority of our assets. Although we
subsequently acquired Amarin Neuroscience (formerly Laxdale Limited) and its
leased facility in Stirling, Scotland on October 8, 2004, we continue to have
limited operations, assets and financial resources. As a result, we
currently have no marketable products or other source of
revenues. All of our current products, including Miraxion, our
principal product, are in the development stage. The development of
pharmaceutical products is a capital intensive business. Therefore,
we expect to incur expenses without corresponding revenues at least until we
are
able to obtain regulatory approval and sell our future products in significant
quantities. This may result in net operating losses, which will
increase continuously until we can generate an acceptable level of revenues,
which we may not be able to attain. Further, even if we do achieve
operating revenues, there can be no assurance that such revenues will be
sufficient to fund continuing operations. Therefore, we cannot
predict with certainty whether we will ever be able to achieve
profitability.
In
addition to advancing our existing development pipeline, we also intend to
acquire rights to additional products. However, we may not be
successful in doing so. We may need to raise additional capital
before we can acquire any products. There is also a risk that
Miraxion or any other development stage products we may acquire will not be
approved by the FDA or regulatory authorities in other countries on a timely
basis or at all. The inability to obtain such approvals would
adversely affect our ability to generate revenues.
The
likelihood of success of our business plan must be considered in light of the
problems, expenses, difficulties, complications and delays frequently
encountered in connection with developing and expanding early stage businesses
and the regulatory and competitive environment in which we operate.
Our
historical financial results do not form an accurate basis for assessing our
current business.
As
a
consequence of the divestiture of a majority of our business and assets during
2003 and early 2004 and our acquisition of Amarin Neuroscience in October 2004,
our historical financial results do not form an accurate basis upon which
investors should base an assessment of our business and
prospects. Prior to such divestiture, our business was primarily the
sale of marketable products in the United States, the out-licensing of our
proprietary technologies, and research and development
activities. Following the acquisition of Amarin Neuroscience, we are
now focused on the research, development and commercialization of novel drugs
for the central nervous system, which we refer to as the
CNS. Accordingly, our historical financial results reflect a
substantially different business from that currently being
conducted.
3
We
may have to issue additional equity leading to shareholder
dilution.
We
are
committed to issue equity to the former shareholders of Amarin Neuroscience
upon
the successful achievement of specified milestones for the Miraxion development
program (subject to such shareholders’ right to choose cash payment in lieu of
equity). Pursuant to the Amarin Neuroscience share purchase
agreement, further success-related milestones will be payable as
follows:
On
receipt of marketing approval in the United States and Europe for the first
indication of any product containing Amarin Neuroscience intellectual property,
we must make an aggregate stock or cash payment (at the sole option of each
of
the sellers) of GBP£7.5 million for each of the two potential market approvals
(i.e., GBP£15.0 million maximum).
In
addition, on receipt of a marketing approval in the United States and Europe
for
any other product using Amarin Neuroscience intellectual property or for a
different indication of a previously approved product, we must make an aggregate
stock or cash payment (at the sole option of each of the sellers) of GBP£5
million for each of the two potential market approvals (i.e., GBP£10 million
maximum).
In
connection with the completion of our December 2005 private placement of
Ordinary Shares, which raised gross proceeds of $26.4 million, investors in
the
offering were issued 5-year warrants to purchase 9,135,034 ordinary shares
at an
exercise price of $1.43 per share. In addition, in connection with an
additional private placement of ordinary shares which raised gross proceeds
of
$2.1 million, the investor in the offering was issued 5-year warrants to
purchase 280,000 ordinary shares at an exercise price of $3.06 per
share.
We
also
have outstanding warrants to purchase 500,000 ordinary shares at an exercise
price of $1.90 per share, which were originally acquired by Elan Corporation,
plc as part of a debt renegotiation and were subsequently sold by Elan to Amarin
Investment Holding Limited, an entity controlled by Mr. Thomas G.
Lynch, our Chairman. We also have outstanding warrants to purchase
313,234 ordinary shares at an exercise price of $3.48 per share. As
at May 31, 2006, we also had outstanding employee options to purchase 5,286,963
ordinary shares at an average price of $3.00 per share. Additionally,
in pursuing our growth strategy we will either need to issue new equity as
consideration for the acquisition of products, or to otherwise raise additional
capital, in which case equity, convertible equity or debt instruments may be
issued. The creation of new shares would lead to dilution of the
value of the shares held by our current shareholder base.
If
we cannot find additional capital resources, we will have difficulty in
operating as a going concern and growing our business.
The
Company forecasts having sufficient cash to fund our group operating activities
into the fourth quarter of 2007. In addition, we intend to obtain
additional funding through earning license fees from partnering our drug
development pipeline and/or completing further financings. There is
no assurance, however, that our efforts to obtain additional funding from these
sources will be successful. If efforts are unsuccessful, there is
substantial uncertainty as to whether we will be able to fund our operations
on
an ongoing basis. We may also require further funds in the future to
implement our long-term growth strategy of acquiring additional development
stage and/or marketable products, recruiting clinical, regulatory and sales
and
marketing personnel, and growing our business. Our ability to execute
our business strategy and sustain our infrastructure at our current level will
be impacted by whether or not we have sufficient funds. Depending on
market conditions and our ability to maintain financial stability, we may not
have access to additional funds on reasonable terms or at all. Any
inability to obtain additional funds when needed would have a material adverse
effect on our business and on our ability to operate on a ongoing
basis.
We
may be dependent upon the success of a limited range of products.
At
present, we are substantially reliant upon the success of our principal product,
Miraxion. If development efforts for this product are not successful
in either Huntington’s disease, which we refer to as HD, depression, or any
other indication or if approved by the FDA, if adequate demand for this product
is not generated, our business will
4
be
materially and adversely affected. Although we intend to bring
additional products forward from our research and development efforts, including
our novel oral formulation of apomorphine for the treatment of
“off” episodes in patients with advanced Parkinson’s disease, and to
acquire additional products, even if we are successful in doing so, the range
of
products we will be able to commercialize may be limited. This could
restrict our ability to respond to adverse business conditions. If we
are not successful in developing Miraxion for HD, depression, or any other
indication, our formulation of apomorphine for treatment of Parkinson’s disease,
or any future product, or if there is not adequate demand for any such product
or the market for such product develops less rapidly than we anticipate, we
may
not have the ability to shift our resources to the development of alternative
products. As a result, the limited range of products we intend to
develop could constrain our ability to generate revenues and achieve
profitability.
Our
ability to generate revenues depends on obtaining regulatory approvals for
Miraxion.
Miraxion,
which is in phase III clinical development for HD, phase II clinical development
for depressive disorders, and preclinical development for Parkinson’s disease is
currently our only product in late-stage development. In order to
successfully commercialize Miraxion, we will be required to conduct all tests
and clinical trials needed in order to meet regulatory requirements, to obtain
applicable regulatory approvals, and to prosecute patent
applications. The costs of developing and obtaining regulatory
approvals for pharmaceutical products can be substantial. We are
conducting two phase III clinical studies to support a possible new drug
application, which we refer to as an NDA, for Miraxion for the treatment of
HD. Statistical significance was not achieved in the entire study
patient population in the first phase III study; however, a trend to
significance was observed in the group that adhered to the protocol and
significant results were observed in the sub-group of patients that had a
genetic CAG number of less than 45. Our ability to commercialize
Miraxion for this indication is dependent upon the success of these development
efforts. If such clinical trials fail to produce satisfactory
results, or if we are unable to maintain the financial and operational
capability to complete these development efforts, we may be unable to generate
revenues from Miraxion. Even if we obtain regulatory approvals, the
timing or scope of any approvals may prohibit or reduce our ability to
commercialize Miraxion successfully. For example, if the approval
process takes too long we may miss market opportunities and give other companies
the ability to develop competing products. Additionally, the terms of
any approvals may not have the scope or breadth needed for us to commercialize
Miraxion successfully.
We
may not be successful in developing or marketing future products if we cannot
meet extensive regulatory requirements of the FDA and other regulatory agencies
for quality, safety and efficacy.
Our
long-term strategy involves the development of products we may acquire from
third parties. The success of these efforts is dependent in part upon
the ability of the Company, its contractors, and its products to meet and to
continue to meet regulatory requirements in the jurisdictions where we
ultimately intend to sell such products. The development, manufacture
and marketing of pharmaceutical products are subject to extensive regulation
by
governmental authorities in the United States, the European Union, Japan and
elsewhere. In the United States, the FDA generally requires
pre-clinical testing and clinical trials of each drug to establish its safety
and efficacy and extensive pharmaceutical development to ensure its quality
before its introduction into the market. Regulatory authorities in
other jurisdictions impose similar requirements. The process of
obtaining regulatory approvals is lengthy and expensive and the issuance of
such
approvals is uncertain. The commencement and rate of completion of
clinical trials may be delayed by many factors, including:
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the
inability to manufacture sufficient quantities of qualified materials
under current good manufacturing practices for use in clinical
trials;
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slower
than expected rates of patient
recruitment;
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the
inability to observe patients adequately after
treatment;
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changes
in regulatory requirements for clinical
trials;
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the
lack of effectiveness during clinical
trials;
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unforeseen
safety issues;
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5
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delay,
suspension, or termination of a trial by the institutional review
board
responsible for overseeing the study at a particular study site;
and
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government
or regulatory delays or “clinical holds” requiring suspension or
termination of a trial.
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Even
if
we obtain positive results from early stage pre-clinical or clinical trials,
we
may not achieve the same success in future trials. Clinical trials
that we conduct may not provide sufficient safety and effectiveness data to
obtain the requisite regulatory approvals for product candidates. The
failure of clinical trials to demonstrate safety and effectiveness for our
desired indications could harm the development of that product candidate as
well
as other product candidates, and our business and results of operations would
suffer.
Any
approvals that are obtained may be limited in scope, or may be accompanied
by
burdensome post-approval study or other requirements. This could
adversely affect our ability to earn revenues from the sale of such
products. Even in circumstances where products are approved by a
regulatory body for sale, the regulatory or legal requirements may change over
time, or new safety or efficacy information may be identified concerning a
product, which may lead to the withdrawal of a product from the
market. Additionally, even after approval, a marketed drug and its
manufacturer are subject to continual review. The discovery of
previously unknown problems with a product or manufacturer may result in
restrictions on such product or manufacturer, including withdrawal of the
product from the market, which would have a negative impact on our potential
revenue stream.
After
approval, our products will be subject to extensive government
regulation.
Once
a
product is approved, numerous post-approval requirements apply. Among
other things, the holder of an approved NDA or other license is subject to
periodic and other monitoring and reporting obligations enforced by the FDA
and
other regulatory bodies, including obligations to monitor and report adverse
events and instances of the failure of a product to meet the specifications
in
the approved application. Application holders must also submit
advertising and other promotional material to regulatory authorities and report
on ongoing clinical trials.
Advertising
and promotional materials must comply with FDA rules in addition to other
potentially applicable federal and local laws in the United States and in other
countries. In the United States, the distribution of product samples
to physicians must comply with the requirements of the U.S. Prescription Drug
Marketing Act. Manufacturing facilities remain subject to FDA
inspection and must continue to adhere to the FDA’s current good manufacturing
practice requirements. Application holders must obtain FDA approval
for product and manufacturing changes, depending on the nature of the
change. Sales, marketing, and scientific/educational grant programs
must also comply with the U.S. Medicare-Medicaid Anti-Fraud and Abuse Act,
as
amended, the U.S. False Claims Act, as amended and similar state
laws. Pricing and rebate programs must comply with the U.S. Medicaid
rebate requirements of the Omnibus Budget Reconciliation Act of 1990, as
amended. If products are made available to authorized users of the
U.S. Federal Supply Schedule of the General Services Administration, additional
laws and requirements apply. All of these activities are also
potentially subject to U.S. federal and state consumer protection and unfair
competition laws. Similar requirements exist in all of these areas in
other countries.
Depending
on the circumstances, failure to meet these post-approval requirements can
result in criminal prosecution, fines or other penalties, injunctions, recall
or
seizure of products, total or partial suspension of production, denial or
withdrawal of pre-marketing product approvals, or refusal to allow us to enter
into supply contracts, including government contracts. In addition,
even if we comply with FDA and other requirements, new information regarding
the
safety or effectiveness of a product could lead the FDA to modify or withdraw
a
product approval. Adverse regulatory action, whether pre- or
post-approval, can potentially lead to product liability claims and increase
our
product liability exposure. We must also compete against other
products in qualifying for reimbursement under applicable third party payment
and insurance programs.
Our
future products may not be able to compete effectively against those of our
competitors.
Competition
in the pharmaceutical industry is intense and is expected to
increase. If we are successful in completing the development of
Miraxion, we may face competition to the extent other pharmaceutical companies
are able to develop products for the treatment of HD, depression or Parkinson’s
disease. Potential competitors in
6
this
market may include companies with greater resources and name recognition than
us. Furthermore, to the extent we are able to acquire or develop
additional marketable products in the future such products will compete with
a
variety of other products within the United States or elsewhere, possibly
including established drugs and major brand names. Competitive
factors, including generic competition, could force us to lower prices or could
result in reduced sales. In addition, new products developed by
others could emerge as competitors to our future products. Products
based on new technologies or new drugs could render our products obsolete or
uneconomical.
Our
potential competitors both in the United States and Europe may include large,
well-established pharmaceutical companies, specialty pharmaceutical sales and
marketing companies, and specialized neurology companies. In
addition, we may compete with universities and other institutions involved
in
the development of technologies and products that may be competitive with
ours. Many of our competitors will likely have greater resources than
us, including financial, product development, marketing, personnel and other
resources. Should a competitive product obtain marketing approval
prior to Miraxion, this would significantly erode the projected revenue streams
for such product.
The
success of our future products will also depend in large part on the willingness
of physicians to prescribe these products to their patients. Our
future products may compete against products that have achieved broad
recognition and acceptance among medical professionals. In order to
achieve an acceptable level of subscriptions for our future products, we must
be
able to meet the needs of both the medical community and end users with respect
to cost, efficacy and other factors.
Our
supply of future products could be dependent upon relationships with
manufacturers and key suppliers.
We
have
no in-house manufacturing capacity and, to the extent we are successful in
completing the development of Miraxion and/or acquiring or developing other
marketable products in the future, we will be obliged to rely upon contract
manufacturers to produce our products. We may not be able to enter
into manufacturing arrangements on terms that are favorable to
us. Moreover, if any future manufacturers should cease doing business
with us or experience delays, shortages of supply or excessive demands on their
capacity, we may not be able to obtain adequate quantities of product in a
timely manner, or at all. Manufacturers are required to comply with
current NDA commitments and Good Manufacturing Practices requirements enforced
by the FDA, and similar requirements of other countries. The failure
by a future manufacturer to comply with these requirements could affect its
ability to provide us with product. Any manufacturing problem or the
loss of a contract manufacturer could be disruptive to our operations and result
in lost sales.
Additionally,
we will be reliant on third parties to supply the raw materials needed to
manufacture Miraxion and other potential products. Any reliance on
suppliers may involve several risks, including a potential inability to obtain
critical materials and reduced control over production costs, delivery
schedules, reliability and quality. Any unanticipated disruption to
future contract manufacture caused by problems at suppliers could delay shipment
of products, increase our cost of goods sold and result in lost
sales.
We
may not be able to grow our business unless we can acquire and market or
in-license new products.
We
are
pursuing a strategy of product acquisitions and in-licensing in order to
supplement our own research and development activity. For example, in
May 2006, we acquired the global rights to a novel formulation of apomorphine
for the treatment of “off” episodes in patients with advanced Parkinson’s
disease. Our success in this regard will be dependent on our ability
to identify other companies that are willing to sell or license product lines
to
us. We will be competing for these products with other parties, many
of whom have substantially greater financial, marketing and sales
resources. Even if suitable products are available, depending on
competitive conditions we may not be able to acquire rights to additional
products on acceptable terms, or at all. Our inability to acquire
additional products or successfully introduce new products could have a material
adverse effect on our business.
7
In
order to commercialize our future products, we will need to establish a sales
and marketing capability.
At
present, we do not have any sales or marketing capability since all of our
products are currently in the development stage. However, if we are
successful in obtaining regulatory approval for Miraxion, we intend to directly
commercialize this product for HD in the U.S. market. Similarly, to
the extent we execute our long-term strategy of expanding our portfolio by
developing or acquiring additional marketable products, we intend to directly
sell our neurology products in the United States. In order to market
Miraxion and any other new products, we will need to add marketing and sales
personnel who have expertise in the pharmaceuticals business. We must
also develop the necessary supporting distribution channels. Although
we believe we can build the required infrastructure, we may not be successful
in
doing so if we cannot attract personnel or generate sufficient capital to fund
these efforts. Failure to establish a sales force and distribution
network in the United States would have a material adverse effect on our ability
to grow our business.
The
planned expansion of our business may strain our resources.
Our
strategy for growth includes potential acquisitions of new products for
development and the introduction of these products to the
market. Since we currently operate with limited resources, the
addition of such new products could require a significant expansion of our
operations, including the recruitment, hiring and training of additional
personnel, particularly those with a clinical or regulatory
background. Any failure to recruit necessary personnel could have a
material adverse effect on our business. Additionally, the expansion
of our operations and work force could create a strain on our financial and
management resources and it may require us to add management
personnel.
We
may incur potential liabilities relating to discontinued operations or
products.
In
October 2003, we sold Gacell Holdings AB, the Swedish holding company of Amarin
Development AB, which we refer to as ADAB, our Swedish drug development
subsidiary, to Watson Pharmaceuticals, Inc. In February 2004, we sold
our U.S. subsidiary, Amarin Pharmaceuticals Inc., and certain assets, to
Valeant. In connection with these transactions, we provided a number
of representations and warranties to Valeant and Watson regarding the respective
businesses sold to them, and other matters, and we undertook to indemnify
Valeant and Watson under certain circumstances for breaches of such
representations and warranties. We are not aware of any circumstances
which could reasonably be expected to give rise to an indemnification obligation
under our agreements with either Valeant or Watson. However, we
cannot predict whether matters may arise in the future which were not known
to
us and which, under the terms of the relevant agreements, could give rise to
a
claim against us.
We
will be dependent on patents, proprietary rights and
confidentiality.
Because
of the significant time and expense involved in developing new products and
obtaining regulatory approvals, it is very important to obtain patent and trade
secret protection for new technologies, products and processes. Our
ability to successfully implement our business plan will depend in large part
on
our ability to:
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acquire
patented or patentable products and
technologies;
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obtain
and maintain patent protection for our current and acquired
products;
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preserve
any trade secrets relating to our current and future products;
and
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operate
without infringing the proprietary rights of third
parties.
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Although
we intend to make reasonable efforts to protect our current and future
intellectual property rights and to ensure that any proprietary technology
we
acquire does not infringe the rights of other parties, we may not be able to
ascertain the existence of all potentially conflicting
claims. Therefore, there is a risk that third parties may make claims
of infringement against our current or future products or
technologies. In addition, third parties may be
8
able
to
obtain patents that prevent the sale of our current or future products or
require us to obtain a license and pay significant fees or royalties in order
to
continue selling such products.
We
may in
the future discover the existence of products that infringe upon patents that
we
own or that have been licensed to us. Although we intend to protect
our trade secrets and proprietary know-how through confidentiality agreements
with our manufacturers, employees and consultants, we may not be able to prevent
our competitors from breaching these agreements or third parties from
independently developing or learning of our trade secrets.
We
anticipate that competitors may from time to time oppose our efforts to obtain
patent protection for new technologies or to submit patented technologies for
regulatory approvals. Competitors may seek to challenge patent
applications or existing patents to delay the approval process, even if the
challenge has little or no merit. Patent challenges are generally
highly technical, time consuming and expensive to pursue. Were we to
be subject to one or more patent challenges, that effort could consume
substantial time and resources, with no assurances of success, even when holding
an issued patent.
The
loss of any key management or qualified personnel could disrupt our
business.
We
are
highly dependent upon the efforts of our senior management. The loss
of the services of one or more members of senior management could have a
material adverse effect on us. As a small company with a streamlined
management structure, the departure of any key person could have a significant
impact and would be potentially disruptive to our business until such time
as a
suitable replacement is hired. Furthermore, because of the
specialized nature of our business, as our business plan progresses we will
be
highly dependent upon our ability to attract and retain qualified scientific,
technical and key management personnel. There is intense competition
for qualified personnel in the areas of our activities. In this
environment we may not be able to attract and retain the personnel necessary
for
the development of our business, particularly if we do not achieve
profitability. The failure to recruit key scientific and technical
personnel would be detrimental to our ability to implement our business
plan.
We
have
entered into an employment agreement with our chief executive officer, Richard
A. B. Stewart. The term of this agreement continues in full force and
effect, subject to either party’s right to terminate upon twelve months’
notice. Our officers and key employees, other than Mr. Stewart, are
not employed for any specified period and are not restricted from seeking
employment elsewhere, subject only to giving appropriate notice to
us.
We
are subject to continuing potential product liability and do not carry product
liability insurance to cover this risk.
Although
we disposed of the majority of our former products during 2003 and 2004, we
remain subject to the potential risk of product liability claims relating to
the
manufacturing and marketing of our former products during the period prior
to
their divestiture. Any person who is injured as a result of using one
of our former products during our period of ownership may have a product
liability claim against us without having to prove that we were at
fault. The potential for liability exists despite the fact that our
former subsidiary, Amarin Pharmaceuticals Inc. conducted all sales and marketing
activities with respect to such product. Although we have not
retained any liabilities of Amarin Pharmaceuticals Inc. in this regard, as
the
prior holder of ownership rights to such former products, third parties could
seek to assert potential claims against us. Since we distributed and
sold our products to a wide number of end users, the risk of such claims could
be material. Product liability claims could also be brought by
persons who took part in clinical trials involving our current or former
development stage products. A successful claim brought against us
could have a material adverse effect on our business.
We
do not
at present carry product liability insurance to cover any such
risks. If we were to seek insurance coverage, we may not be able to
maintain product liability coverage on acceptable terms if our claims experience
results in high rates, or if product liability insurance otherwise becomes
costlier or unavailable because of general economic, market or industry
conditions. If we add significant products to our portfolio, we will
require product liability coverage and may not be able to secure such coverage
at reasonable rates or at all.
Amarin
was responsible for the sales and marketing of Permax from May 2001 until
February 2004. On May 17, 2001, Amarin acquired the U.S. sales
and marketing rights to Permax from Elan. An affiliate of Elan
had
9
previously
obtained the licensing rights to Permax from Eli Lilly and Company in
1993. Eli Lilly originally obtained approval for Permax on December
30, 1988 and has been responsible for the manufacture and supply of Permax
since
that date. On February 25, 2004 Amarin sold its U.S. subsidiary,
Amarin Pharmaceuticals, Inc., including the rights to Permax, to Valeant
Pharmaceuticals International.
In
late
2002, Eli Lilly, as the holder of the NDA for Permax, received a recommendation
from the FDA to consider making a change to the package insert for Permax based
upon the very rare observation of cardiac valvulopathy in patients taking
Permax. While Permax has not been definitely proven as the cause of
this condition, similar reports have been notified in patients taking other
ergot-derived pharmaceutical products, of which Permax is an
example. In early 2003, Eli Lilly amended the package insert for
Permax to reflect the risk of cardiac valvulopathy in patients taking Permax
and
also sent a letter to a number of doctors in the United States describing this
potential risk. Causation is not established, but is thought to be
consistent with other fibrotic side effects observed in Permax.
During
2005, five lawsuits alleging claims related to cardiac valvulopathy and Permax
were pending in the United States. Eli Lilly, Elan, Valeant, and/or
Amarin were defendants in these lawsuits. As of the present date,
each of these cases has settled. Most of the details of these
settlements are confidential.
One
other
lawsuit, which alleges claims related to compulsive gambling and Permax, remains
pending in the United States. Amarin, Eli Lilly, Elan, and Valeant
are defendants in this lawsuit, and are defending against the claims and
allegations. This case is currently in the early stages of
discovery. A similar lawsuit related to compulsive gambling and
Permax is being threatened against Eli Lilly, Elan, and/or Valeant, and could
possibly implicate Amarin.
The
Company has reviewed the position and having taken external legal advice
considers the potential risk of significant liability arising for Amarin from
these legal actions to be remote. No provision is booked in the
accounts at December 2005.
The
price of our ADSs may be volatile.
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 prices of the securities of many
pharmaceutical and medical technology companies have been especially volatile
in
the past, and this trend is expected to continue in the future. Our
ADSs may also be subject to volatility as a result of their limited trading
market. We currently have approximately 81,461,774 ADSs representing
ordinary shares outstanding. There is a risk that there may not be
sufficient liquidity in the market to accommodate significant increases in
selling activity or the sale of a large block of securities. Our ADSs
have historically had limited trading volume, which may also result in
volatility. During the twelve-month period ending June 30, 2006, the
average daily trading volume for our ADSs was 181,810 shares.
If
our
public float and the level of trading remain at limited levels over the long
term, this could result in volatility and increase the risk that the market
price of our ADSs may be affected by factors such as:
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the
announcement of new products or
technologies;
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innovation
by us or our future competitors;
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developments
or disputes concerning any future patent or proprietary
rights;
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actual
or potential medical results relating to our products or our competitors’
products;
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interim
failures or setbacks in product
development;
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regulatory
developments in the United States, the European Union or other
countries;
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10
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currency
exchange rate fluctuations; and
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period-to-period
variations in our results of
operations.
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The
rights of our shareholders may differ from the rights typically afforded to
shareholders of a U.S. corporation.
We
are
incorporated under English law and our ordinary shares have recently been
admitted to trading on the AIM market of the London Stock Exchange and the
IEX
market of the Irish Stock Exchange. The rights of holders of ordinary
shares and, therefore, certain of the rights of holders of ADSs, are governed
by
English law, including the Companies Act 1985 (as amended), and by our
memorandum and articles of association and the Company is subject to the rules
of AIM and IEX. These rights differ in certain respects from the
rights of shareholders in typical U.S. corporations. The principal
differences include the following:
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Under
English law, each shareholder present at a meeting has only one vote
unless a valid demand is made for a vote on a poll, in which each
holder
gets one vote per share owned. Under U.S. law, each shareholder
typically is entitled to one vote per share at all
meetings. Under English law, it is only on a poll that the
number of shares determines the number of votes a holder may
cast. You should be aware, however, that the voting rights of
ADSs are also governed by the provisions of a deposit agreement with
our
depositary bank.
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Under
English law, each shareholder generally has pre-emptive rights to
subscribe on a proportionate basis to any issuance of
shares. Under U.S. law, shareholders generally do not have
pre-emptive rights unless specifically granted in the certificate
of
incorporation or otherwise.
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Under
English law, certain matters require the approval of 75% of the
shareholders, including amendments to the memorandum and articles
of
association. This may make it more difficult for us to complete
corporate transactions deemed advisable by our board of
directors. Under U.S. law, generally only majority shareholder
approval is required to amend the certificate of incorporation or
to
approve other significant transactions. Under the rules of AIM
and IEX, certain transactions require the approval of 50% of the
shareholders, including disposals resulting in a fundamental change
of
business and reverse takeovers. In addition, certain
transactions with a party related to the Company for the purposes
of the
AIM rules requires that the Company consult with its nominated adviser
as
to whether the transaction is fair and reasonable as far as shareholders
are concerned.
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Under
English law, shareholders may be required to disclose information
regarding their equity interests upon our request, and the failure
to
provide the required information could result in the loss or restriction
of rights attaching to the shares, including prohibitions on the
transfer
of the shares, as well as restrictions on dividends and other
payments. Comparable provisions generally do not exist under
U.S. law.
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The
quorum requirements for a shareholders’ meeting is a minimum of two
persons present in person or by proxy. Under U.S. law, a
majority of the shares eligible to vote must generally be present
(in
person or by proxy) at a shareholders’ meeting in order to constitute a
quorum. The minimum number of shares required for a quorum can
be reduced pursuant to a provision in a company’s certificate of
incorporation or bylaws, but typically not below one-third of the
shares
entitled to vote at the meeting.
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U.S.
shareholders may not be able to enforce civil liabilities against
us.
A
number
of our directors and executive officers are non-residents of the United States,
and all or a substantial portion of the assets of such persons are located
outside the United States. As a result, it may not be possible for
investors to effect service of process within the United States upon such
persons or to enforce against them judgments obtained in U.S. courts predicated
upon the civil liability provisions of the federal securities laws of the United
States. We have been advised by our English solicitors that there is
doubt as to the enforceability in England
11
in
original actions, or in actions for enforcement of judgments of U.S. courts,
of
civil liabilities to the extent predicated upon the federal securities laws
of
the United States.
In
addition, Amarin Finance is an exempted company limited by shares organized
under the laws of Bermuda. A number of Amarin Finance’s directors and
executive officers are non-residents of the United States, and all or a
substantial portion of the assets of such persons are located outside the United
States. As a result, it may not be possible for investors to effect
service of process within the United States upon such persons or to enforce
against them in U.S. courts judgments obtained in U.S. courts predicated upon
the civil liability provisions of the federal securities laws of the United
States. We have been advised by our Bermuda attorneys that
uncertainty exists as to whether courts in Bermuda will enforce judgments
obtained in other jurisdictions (including the United States) against us or
our
directors or officers under the securities laws of those jurisdictions or
entertain actions in Bermuda against us or our directors or officers under
the
securities laws of other jurisdictions.
Foreign
currency fluctuations may affect our future financial results or cause us to
incur losses.
We
record
our transactions and prepare our financial statements in U.S.
dollars. Since our strategy involves the development of products for
the U.S. market, a significant part of our clinical trial expenditures are
denominated in U.S. dollars and we anticipate that the majority of our future
revenues will be denominated in U.S. dollars. However, a significant
portion of our costs are denominated in pounds sterling and euro as a result
of
our being engaged in activities in the United Kingdom and the European
Union. As a consequence, the results reported in our financial
statements are potentially subject to the impact of currency fluctuations
between the U.S. dollar on the one hand, and pounds sterling and euro on the
other hand. We are focused on development activities and do not
anticipate generating on-going revenues in the
short-term. Accordingly, we do not engage in significant currency
hedging activities in order to restrict the risk of exchange rate
fluctuations. However, if we should commence commercializing any
products in the United States, changes in the relation of the U.S. dollar to
the
pound sterling and/or the euro may affect our revenues and operating
margins. In general, we could incur losses if the U.S. dollar should
become devalued relative to the pound sterling and/or the euro.
U.S.
Holders of our ordinary shares or ADSs could be subject to material adverse
tax
consequences if we are considered a PFIC for U.S. federal income tax
purposes.
There
is
a risk that we will be classified as a passive foreign investment company,
or
“PFIC”, for U.S. federal income tax purposes. Our status as a PFIC
could result in a reduction in the after-tax return to U.S. Holders of our
Ordinary Shares or ADSs and may cause a reduction in the value of such
shares. We will be classified as a PFIC for any taxable year in which
(i) 75% or more of our gross income is passive income or (ii) at least 50%
of
the average value of all our assets produce or are held for the production
of
passive income. For this purpose, passive income includes interest,
gains from the sale of stock, and royalties that are not derived in the active
conduct of a trade or business. Because we receive interest and may
recognize gains from the sale of appreciated stock, there is a risk that we
will
be considered a PFIC under the income test described above. In
addition, because of our cash position, there is a risk that we will be
considered a PFIC under the asset test described above. While we
believe that the PFIC rules were not intended to apply to companies such as
us
that focus on research, development and commercialization of drugs, no assurance
can be given that the U.S. Internal Revenue Service or a U.S. court would
determine that, based on the composition of our income and assets, we are not
a
PFIC currently or in the future. If we were classified as a PFIC,
U.S. Holders of our ordinary shares or ADSs could be subject to greater U.S.
income tax liability than might otherwise apply, imposition of U.S. income
tax
in advance of when tax would otherwise apply, and detailed tax filing
requirements that would not otherwise apply. The PFIC rules are
complex and you are urged to consult your own tax advisors regarding the
possible application of the PFIC rules to you in your particular
circumstances.
If
we fail to comply with the terms of our licensing agreement with Scarista
Limited, our licensor may terminate certain licenses to patent rights, causing
us to lose valuable intellectual property assets.
Under
the
terms of a licensing agreement between Scarista Limited and Amarin Neuroscience,
our exclusive license to certain valuable patent rights covering certain of
our
technologies may be terminated if we fail to
12
meet
various obligations to Scarista. Under the terms of this agreement we
are obligated to meet certain performance obligations in respect of the clinical
development and commercialization of Miraxion, payment of royalties, and filing,
maintenance and prosecution of the covered patent rights. In
particular, we are obligated to use our reasonable commercial efforts to pursue
the completion of the Miraxion trials with a view to applying for an FDA
approval for the indication of Huntington’s disease in the U.S. Under
the terms of this agreement Scarista is entitled to terminate this agreement
forthwith by notice in writing to the other if we commit a material breach
of
this Agreement and fail to remedy the same within 90 days after receipt of
a
written notice of the breach requiring remedy of the same. The
performance of our obligations to Scarista will require increasing expenditures
as the development of Miraxion continues. We cannot guarantee that we
will be capable of raising the funds necessary to meet our obligations under
this agreement to fulfill these licensing obligations.
We
do not currently have the capability to undertake manufacturing of any potential
products.
We
have
not invested in manufacturing and have no manufacturing
experience. We cannot assure you that we will successfully
manufacture any product we may develop, either independently or under
manufacturing arrangements, if any, with third party
manufacturers. To the extent that we enter into contractual
relationships with other companies to manufacture our products, if any, the
success of those products may depend on the success of securing and maintaining
contractual relationships with third party manufacturers (and any
sub-contractors they engage).
We
have
secured supply of Miraxion through the expected launch period of the
product. Our ability to meet commercial demand for Miraxion beyond
this quantity would depend on our successfully obtaining a commitment for such
supplies. We are currently in discussion with the existing and other
manufacturers to meet this requirement. We cannot guarantee that we
will be able to obtain a commitment from the existing contract manufacturer
and/or to negotiate a second supply agreement with an alternate contract
manufacturer to manufacture additional commercial supplies of
Miraxion. If we were unable to do so, we would be unable to
successfully commercialize Miraxion and our results of operations and prospects
would be materially adversely affected.
We
do not currently have the capability to undertake marketing, or sales of any
potential products.
We
have
not invested in marketing or product sales resources. We cannot
assure you that we will be able to acquire such resources. We cannot
assure you that we will successfully market any product we may develop, either
independently or under marketing arrangements, if any, with other
companies. To the extent that we enter into contractual relationships
with other companies to market our products, if any, the success of such
products may depend on the success of securing and maintaining such contractual
relationships the efforts of those other companies (and any sub-contractors
they
engage).
We
have limited personnel to oversee out-sourced clinical testing and the
regulatory approval process.
It
is
likely that we will also need to hire additional personnel skilled in the
clinical testing and regulatory compliance process if we develop additional
product candidates with commercial potential. We do not currently
have the capability to conduct clinical testing in-house and do not currently
have plans to develop such a capability. We out-source our clinical
testing to contract research organizations. We currently have a
limited number of employees and certain other outside consultants who oversee
the contract research organizations involved in clinical testing of our
compounds.
We
cannot assure you that our limited oversight of the contract research
organizations will suffice to avoid significant problems with the protocols
and
conduct of the clinical trials.
We
depend
on contract research organizations to conduct our pre-clinical and our clinical
testing. We have engaged and intend to continue to engage third party
contract research organizations and other third parties to help us develop
our
drug candidates. Although we have designed the clinical trials for
drug candidates, the contract research organizations will be conducting all
of
our clinical trials. As a result, many important aspects of our drug
development programs have been and will continue to be outside of our direct
control. In addition, the contract re
13
search
organizations may not perform all of their obligations under arrangements with
us. If the contract research organizations do not perform clinical
trials in a satisfactory manner or breach their obligations to us, the
development and commercialization of any drug candidate may be delayed or
precluded. We cannot control the amount and timing of resources these
contract research organizations devote to our programs or product
candidates. The failure of any of these contract research
organizations to comply with any governmental regulations would substantially
harm our development and marketing efforts and delay or prevent regulatory
approval of our drug candidates. If we are unable to rely on clinical
data collected by others, we could be required to repeat, extend the duration
of, or increase the size of our clinical trials and this could significantly
delay commercialization and require significantly greater
expenditures.
Despite
the use of confidentiality agreements and/or proprietary rights agreements,
which themselves may be of limited effectiveness, it may be difficult for us
to
protect our trade secrets.
We
rely
on trade secrets to protect technology in cases when we believe patent
protection is not appropriate or obtainable. However, trade secrets
are difficult to protect. While we require certain of our academic
collaborators, contractors and consultants to enter into confidentiality
agreements, we may not be able to adequately protect our trade secrets or other
proprietary information.
Potential
technological changes in our field of business create considerable
uncertainty.
We
are
engaged in the biopharmaceutical field, which is characterized by extensive
research efforts and rapid technological progress. New developments
in research are expected to continue at a rapid pace in both industry and
academia. We cannot assure you that research and discoveries by
others will not render some or all of our programs or product candidates
uncompetitive or obsolete.
Our
business strategy is based in part upon new and unproven technologies to the
development of biopharmaceutical products for the treatment of Huntington’s
disease and other neurological disorders. We cannot assure you that
unforeseen problems will not develop with these technologies or applications
or
that commercially feasible products will ultimately be developed by
us.
Third-Party
Reimbursement and Health Care Cost Containment Initiatives and Treatment
Guidelines May Constrain Our Future Revenues.
Our
ability to market successfully our existing and future new products will depend
in part on the level of reimbursement that government health administration
authorities, private health coverage insurers and other organizations provide
for the cost of our products and related treatments. Countries in
which our products are sold through reimbursement schemes under national health
insurance programs frequently require that manufacturers and sellers of
pharmaceutical products obtain governmental approval of initial prices and
any
subsequent price increases. In certain countries, including the
United States, government-funded and private medical care plans can exert
significant indirect pressure on prices. We may not be able to sell
our products profitably if adequate prices are not approved or reimbursement
is
unavailable or limited in scope. Increasingly, third-party payers
attempt to contain health care costs in ways that are likely to impact our
development of products including:
|
·
|
failing
to approve or challenging the prices charged for health care
products;
|
|
·
|
introducing
reimportation schemes from lower priced
jurisdictions;
|
|
·
|
limiting
both coverage and the amount of reimbursement for new therapeutic
products;
|
|
·
|
denying
or limiting coverage for products that are approved by the regulatory
agencies but are considered to be experimental or investigational
by
third-party payers;
|
|
·
|
refusing
to provide coverage when an approved product is used in a way that
has not
received regulatory marketing approval;
and
|
14
|
·
|
refusing
to provide coverage when an approved product is not appraised favorably
by
the National Institute for Clinical Excellence in the UK, or similar
agencies in other countries.
|
We
are undergoing significant organizational change. Failure to manage
disruption to the business or the loss of key personnel could have an adverse
effect on our business.
We
are
making significant changes to both our management structure and the locations
from which we operate. As a result of this, in the short term, morale
may be lowered and key employees may decide to leave, or may be distracted
from
their usual role. This could result in delays in development
projects, failure to achieve managerial targets or other disruption to the
business. The benefits of the reorganization are expected to be a
significant improvement in operating effectiveness and substantial cost
savings.
15
FORWARD-LOOKING
STATEMENTS
This
prospectus includes forward-looking statements. These forward-looking
statements relate, among other things, to our ability to develop and obtain
regulatory approvals for our products under development, our future capital
needs, our ability to further acquire or develop additional marketable products,
acceptance of our products by prescribers and end-users, our ability to retain
and maintain our relationships with third-party manufacturers on which we rely,
competitive factors, and our marketing and sales plans. In addition,
we may make forward-looking statements in future filings with the Securities
and
Exchange Commission, or the SEC, and in written material, press releases and
oral statements issued by or on behalf of us. Forward-looking
statements include statements regarding our intent, belief or current
expectations or those of our management regarding various matters, including
statements that include forward-looking terminology such as “may,” “will,”
“should,” “believes,” “expects,” “anticipates,” “estimates,” “continues,” or
similar expressions.
Forward-looking
statements are subject to risks and uncertainties, certain of which are beyond
our control. Among the factors that could cause actual results to
differ materially from those described or projected herein are the factors
identified in the Risk Factors section of this prospectus and any prospectus
supplement and the following:
|
·
|
the
success of our research and development activities, including the
phase
III trials with Miraxion in Huntington’s disease and our efforts with
apomorphine in Parkinson’s desease;
|
|
·
|
decisions
by regulatory authorities regarding whether and when to approve our
drug
applications, as well as their decisions regarding labeling and other
matters that could affect the commercial potential of our
products;
|
|
·
|
the
speed with which regulatory authorizations, pricing approvals and
product
launches may be achieved;
|
|
·
|
the
success with which developed products may be
commercialized;
|
|
·
|
competitive
developments affecting our products under
development;
|
|
·
|
the
effect of possible domestic and foreign legislation or regulatory
action
affecting, among other things, pharmaceutical pricing and reimbursement,
including under Medicaid and Medicare in the United States, and
involuntary approval of prescription medicines for over-the-counter
use;
|
|
·
|
our
ability to protect our patents and other intellectual
property;
|
|
·
|
claims
and concerns that may arise regarding the safety or efficacy of our
product candidates;
|
|
·
|
governmental
laws and regulations affecting our operations, including those affecting
taxation;
|
|
·
|
our
ability to maintain sufficient cash and other liquid resources to
meet our
operating requirements;
|
|
·
|
general
changes in U.K. and U.S. generally accepted accounting
principles;
|
|
·
|
growth
in costs and expenses; and
|
|
·
|
the
impact of acquisitions, divestitures and other unusual items, including
our ability to integrate our acquisition of Amarin
Neuroscience.
|
This
list
of factors is not exclusive and other risks and uncertainties may cause actual
results to differ materially from those in forward-looking
statements.
All
forward-looking statements in this prospectus are based on information available
to us on the date hereof. We may not be required to publicly update
or revise any forward-looking statements that may be made by
16
us
or on
our behalf, in this prospectus or otherwise, whether as a result of new
information, future events or other reasons. Because of these risks
and uncertainties, the forward-looking events and circumstances discussed in
this prospectus might not transpire.
17
We
changed our functional currency on January 1, 2003 to U.S. dollars to
reflect the fact that the majority of our transactions, assets and liabilities
were, after that date, to be denominated in that
currency. Consequently, certain historical pound sterling amounts in
this prospectus and in the material incorporated by reference herein have been
translated into U.S. dollars. Unless otherwise stated herein,
translations of pounds sterling into and from U.S. dollars have been made at
an
exchange rate of £1 to $1.6099, being the mid point rate on December 31,
2002. The Noon Buying Rate in New York City for cable transfers in
pounds sterling as certified for customs purposes by the Federal Reserve Bank
of
New York at December 31, 2002 was £1.00 to $1.6095. We do not
believe this difference to be material. On July 11, 2006, the Noon
Buying Rate was £1.00 to $1.8431.
18
The
SEC
allows us to incorporate by reference documents we file with the SEC, which
means that we can disclose information to you by referring you to those
documents. The information incorporated by reference is considered to
be part of this prospectus, and certain later information that we file with
the SEC will automatically update and
supersede this information. We incorporate by reference the following
documents:
|
|
(i)
|
our
Annual Report on Form 20-F for the fiscal year ended
December 31, 2005 filed on March 30, 2006 and any amendments
thereto; and
|
|
|
(ii)
|
our
reports on Form 6-K dated April 5, 2006, April 7, 2006, May 8,
2006, May 9, 2006, May 11, 2006, May 12, 2006, May 17, 2006, May
18, 2006,
June 9, 2006, June 29, 2006, July 5, 2006 and July 11, 2006.
|
All
annual reports on Form 20-F that we file with the SEC pursuant to the
Exchange Act after the date of this prospectus and prior to the termination
of
the offering shall be deemed to be incorporated by reference into this
prospectus and to be part hereof from the date of filing of such
documents. We may incorporate by reference any Form 6-K
subsequently submitted to the SEC by identifying in such Form that it is being
incorporated by reference into this prospectus.
We
shall
undertake to provide without charge to each person to whom a copy of this
prospectus has been delivered, upon the written or oral request of any such
person to us, a copy of any or all of the documents referred to above that
have
been or may be incorporated into this prospectus by reference, including
exhibits to such documents, unless such exhibits are specifically incorporated
by reference to such documents. Requests for such copies should be
directed to Amarin Corporation plc, 50 Pembroke Road, Ballsbridge, Dublin 4,
Ireland, Attention: Company Secretary, telephone +353 (0) 1 669
9023.
You
should rely only on the information incorporated by reference or provided in
this prospectus or any prospectus supplement. We have not authorized
anyone else to provide you with different information. This
prospectus is an offer to sell or to buy only the securities referred to in
this
prospectus, and only under circumstances and in jurisdictions where it is lawful
to do so. The information contained in this prospectus or any
prospectus supplement is current only as of the date on the front page of those
documents. Also, you should not assume that there has been no change
in our affairs since the date of this prospectus or any applicable prospectus
supplement.
19
We
file
reports, including annual reports on Form 20-F, and other information with
the SEC pursuant to the rules and regulations of the SEC that apply to foreign
private issuers. You may read and copy any materials filed with the
SEC at its Public Reference Room at 100 F Street, N.E., Room 1580, Washington,
D.C. 20549. You may obtain information on the operation of the Public
Reference Room by calling the SEC at 1-800-SEC-0330. The registration
statement of which this prospectus is a part, and other public filings with
the
SEC, are also available on the website maintained by the SEC at http://www.sec.gov.
We
provide Citibank N.A., as depositary under the deposit agreement between us,
the
depositary and registered holders of the American Depositary Receipts evidencing
ADSs, with annual reports, including a review of operations, and annual audited
consolidated financial statements prepared in conformity with generally accepted
accounting principles in the United Kingdom, or UK GAAP, together with a
reconciliation of net income and total stockholders equity to generally accepted
accounting principles in the United States, or US GAAP. Upon receipt
of these reports, the depositary is obligated to promptly mail them to all
record holders of ADSs. We also furnish to the depositary all notices
of meetings of holders of our ordinary shares and other reports and
communications that are made generally available to holders of our ordinary
shares. The depositary has undertaken in the deposit agreement to
mail to all holders of ADSs a notice containing the information contained in
any
notice of a shareholders’ meeting received by the depositary, or a summary of
such information. The depositary has also undertaken in the deposit
agreement to make available to all holders of ADSs such notices and all other
reports and communications received by the depositary in the same manner as
we
make them available to holders of ordinary shares.
ENFORCEABILITY
OF CIVIL LIABILITIES
Amarin
Corporation plc
We
are a
public limited company incorporated under the laws of England and
Wales. A number of our directors and executive officers are
non-residents of the United States, and all or a substantial portion of the
assets of such persons are located outside the United States. As a
result, it may not be possible for investors to effect service of process within
the United States upon such persons or to enforce against them in U.S. courts
judgments obtained in U.S. courts predicated upon the civil liability provisions
of the federal securities laws of the United States. We have been
advised by our English solicitors that there is doubt as to the enforceability
in England, in original actions or in actions for enforcement of judgments
of
U.S. courts, of civil liabilities to the extent predicated upon the federal
securities laws of the United States.
Amarin
Finance Ltd.
Amarin
Finance is an exempted company limited by shares company organized under the
laws of Bermuda. A number of Amarin Finance’s directors and executive
officers are non-residents of the United States, and all or a substantial
portion of the assets of such persons are located outside the United
States. As a result, it may not be possible for investors to effect
service of process within the United States upon such persons or to enforce
against them in U.S. courts judgments obtained in U.S. courts predicated upon
the civil liability provisions of the federal securities laws of the United
States. We have been advised by our Bermuda lawyers that there is
doubt as to the enforceability in Bermuda, in original actions or in actions
for
enforcement of judgments of U.S. courts, of civil liabilities to the extent
predicated upon the federal securities laws of the United States.
Unless
otherwise indicated in an
accompanying prospectus supplement, we intend to use the net proceeds from
the
sale of securities for general corporate purposes, which may include
funding future acquisitions.
Proceeds
may also be used for other purposes specified in the applicable prospectus
supplement.
20
RATIO
OF
EARNINGS TO FIXED CHARGES AND RATIO OF EARNINGS TO COMBINED FIXED
CHARGES AND PREFERENCE SHARE DIVIDENDS
CHARGES AND PREFERENCE SHARE DIVIDENDS
Amarin’s
ratio of earnings to fixed charges and ratio of earnings to combined fixed
charges and preference share dividends for the periods presented are as
follows:
|
Year
Ended December 31,
|
|||||
|
2005
|
2004
|
2003
|
2002
|
2001
|
|
|
Ratio
of earnings to fixed charges – UK GAAP*
|
-
|
-
|
-
|
-
|
-
|
|
Ratio
of earnings to fixed charges – US GAAP*
|
-
|
-
|
-
|
-
|
-
|
|
Ratio
of earnings to combined fixed charges – UK GAAP
|
-
|
-
|
-
|
-
|
-
|
|
Ratio
of earnings to combined fixed charges – US GAAP
|
-
|
-
|
-
|
-
|
-
|
*
The
company reported an operating loss on ordinary activities for each of the five
years 2001 – 2005.
|
·
|
Under
UK GAAP, the deficiency of earnings to cover fixed charges for the
fiscal
year ended December 31, 2001 was $5,046,000, for the fiscal year
ended
December 31, 2002 was $9,033,000, for the fiscal year ended December
31,
2003 was $7,520,000 for the fiscal year ended December 31, 2004 was
$10,594,000 and for the fiscal year ended December 31, 2005 was
$19,285,000.
|
|
·
|
Under
UK GAAP, the deficiency of earnings to cover combined fixed charges
and
preferred stock dividends for the fiscal year ended December 31,
2001 was
$5,246,000, for the fiscal year ended December 31, 2002 was $9,155,000
and
for the fiscal year ended December 31, 2003 was
$7,544,000.
|
|
·
|
Under
US GAAP, the deficiency of earnings to cover fixed charges for the
fiscal
year ended December 31, 2001 was $5,736,000, for the fiscal year
ended
December 31, 2002 was $6,453,000, for the fiscal year ended December
31,
2003 was $6,994,000 for the fiscal year ended December 31, 2004 was
$57,860,000 and for the fiscal year ended December 31, 2005 was
$20,282,000.
|
|
·
|
Under
US GAAP, the deficiency of earnings to cover combined fixed charges
and
preferred stock dividends for the fiscal year ended December 31,
2001 was
$5,936,000, for the fiscal year ended December 31, 2002 was $6,575,000
and
for the fiscal year ended December 31, 2003 was
$7,018,000.
|
Earnings
consist of income before taxes plus fixed charges. Fixed charges
consist of interest expense and the portion of rent expense that is
representative of interest expense.
CAPITALIZATION
AND INDEBTEDNESS1
The
following table sets forth, on a UK GAAP basis, our capitalization as of March
31, 2006. Adjustments up to May 30, 2006 are described
below. This table should be read in conjunction with our consolidated
financial statements as of and for the three years ended December 31, 2005
set forth in our Annual Report on Form 20-F (incorporated by reference
herein), for the year ended December 31, 2005.
In
April
2006, the Company issued 20,066 shares due to the exercise of share options
of
nominal values $2,000 in aggregate for a total consideration of
$61,000. In May 2006, the Company issued 120,096 shares due to the
exercise of shares options of nominal value $11,000 in aggregate for a total
consideration of $345,000.
|
1
|
We
have no indebtedness outstanding on the date of this prospectus
and had no
indebtedness outstanding as of March 31,
2006.
|
21
As
of
March 31, 2006, Amarin Corporation plc held approximately $35.3 million of
cash
and receivables balances.
| $’000 | ||||
|
Shareholders’
equity:
|
||||
|
Ordinary
share capital
|
7,108 | |||
|
Treasury
shares
|
(217 | ) | ||
|
Capital
redemption reserve
|
27,633 | |||
|
Share
premium account
|
130,818 | |||
|
Profit
and loss account — (deficit)
|
(126,065 | ) | ||
|
Total
shareholders’ equity
|
39,277 | |||
|
Total
capitalization
|
39,277 |
22
The
following table sets forth the range of high and low closing sale prices for
our
ADSs for the periods indicated, as reported by the Nasdaq Capital
Market. These prices do not include retail mark-ups, markdowns, or
commissions but give effect to a change in the number of ordinary shares
represented by each ADS, implemented in both October 1998 and
July 2002. Historical data in the table has been restated to
take into account these changes.
|
USD
High
|
USD
Low
|
|
|
Fiscal
Year Ended
|
||
|
December
31, 2001
|
27.97
|
5.00
|
|
December
31, 2002
|
21.00
|
2.76
|
|
December
31, 2003
|
4.81
|
1.39
|
|
December 31,
2004
|
3.99
|
0.53
|
|
December 31,
2005
|
3.40
|
1.06
|
|
Fiscal
Year Ended December 31, 2004
|
||
|
First
Quarter
|
3.50
|
1.35
|
|
Second
Quarter
|
1.46
|
0.86
|
|
Third
Quarter
|
0.97
|
0.53
|
|
Fourth
Quarter
|
3.99
|
1.00
|
|
Fiscal
Year Ended December 31, 2005
|
||
|
First
Quarter
|
3.40
|
2.14
|
|
Second
Quarter
|
2.36
|
1.06
|
|
Third
Quarter
|
1.67
|
1.32
|
|
Fourth
Quarter
|
1.45
|
1.07
|
|
Fiscal
Year Ending December 31, 2006
|
||
|
First
Quarter
|
3.74
|
1.27
|
|
Second
Quarter
|
3.10
|
1.93
|
|
January
2006
|
3.43
|
1.27
|
|
February
2006
|
3.74
|
2.96
|
|
March
2006
|
3.60
|
3.17
|
|
April,
2006
|
3.10
|
2.79
|
|
May,
2006
|
3.01
|
1.93
|
|
June,
2006
|
2.47
|
2.14
|
On
July 11, 2006, the closing price of our ADSs as reported on the Nasdaq
Capital Market was $2.41 per ADS.
23
We
or
Amarin Finance may elect to offer debt securities. The following
description of debt securities sets forth the material terms and provisions
of
the debt securities to which any prospectus supplement may
relate. Amarin’s senior debt securities would be issued under a
senior indenture to be entered into among Amarin and a trustee to be
named. Amarin’s subordinated debt securities would be issued under a
subordinated indenture to be entered into among Amarin and a trustee to be
named. The senior or subordinated indenture, a form of each of which
is included as an exhibit to the registration statement of which this prospectus
is a part, will be executed at the time we issue any debt
securities. Any supplemental indentures will be filed with the SEC on
a Form 6-K or by a post-effective amendment to the registration statement of
which this prospectus is a part.
The
senior debt securities of Amarin Finance would be issued under a senior
indenture to be entered into among that entity, Amarin, as guarantor, and a
trustee to be named. The subordinated debt securities of Amarin
Finance would be issued under a subordinated indenture to be entered into among
that entity, Amarin, as guarantor, and a trustee to be named. The
senior or subordinated indenture, a form of each of which is included as an
exhibit to the registration statement of which this prospectus is a part, will
be executed at the time we issue any debt securities. Any
supplemental indentures will be filed with the SEC on a Form 6-K or by a
post-effective amendment to the registration statement of which this prospectus
is a part.
All
of
the indentures are sometimes referred to in this prospectus collectively as
the
“indentures” and each, individually, as an “indenture.” All senior
indentures are sometimes referred to in this prospectus collectively as the
“senior indentures” and each, individually, as a “senior
indenture.” All subordinated indentures are sometimes referred to in
this prospectus collectively as the “subordinated indentures” and each,
individually, as a “subordinated indenture.” The particular terms of
the debt securities offered by any prospectus supplement, and the extent to
which the general provisions described below may apply to the offered debt
securities, will be described in the applicable prospectus
supplement. The indentures will be qualified under the Trust
Indenture Act of 1939, as amended (the “Trust Indenture Act”). The
terms of the debt securities will include those stated in the indentures and
those made part of the indentures by reference to the Trust Indenture
Act.
Because
the following summaries of the material terms and provisions of the indentures
and the related debt securities are not complete, you should refer to the forms
of the indentures and the debt securities for complete information on some
of
the terms and provisions of the indentures, including definitions of some of
the
terms used below, and the debt securities. The senior indentures and
subordinated indentures are substantially identical to one another, except
for
specific provisions relating to subordination contained in the subordinated
indentures.
General
The
provisions of the indentures do not limit the aggregate principal amount of
debt
securities which may be issued thereunder. Unless otherwise provided
in a prospectus supplement, the senior debt securities will be the issuer’s
direct, unsecured and unsubordinated general obligations and will have the
same
rank as all of the issuer’s other unsecured and unsubordinated
debt. The subordinated debt securities will be unsecured obligations
of the issuer, subordinated in right of payment to the prior payment in full
of
all senior indebtedness of the issuer with respect to such series, as described
below under “Subordination of the Subordinated Debt Securities” and in the
applicable prospectus supplement.
Payments
The
issuer may issue debt securities from time to time in one or more
series. The provisions of the indentures allow the issuer to “reopen”
a previous issue of a series of debt securities and issue additional debt
securities of that series. The debt securities may be denominated and
payable in U.S. dollars or foreign currencies. The issuer may also
issue debt securities from time to time with the principal amount or interest
payable on any relevant payment date to be determined by reference to one or
more currency exchange rates, securities or baskets of securities, commodity
prices or indices. Holders of these types of debt securities will
receive payments of principal or interest that depend upon the value of the
applicable currency, security or basket of securities, commodity or index on the
relevant payment dates.
24
Debt
securities may bear interest at a fixed rate, which may be zero, a floating
rate, or a rate which varies during the lifetime of the debt
security. Debt securities bearing no interest or interest at a rate
that at the time of issuance is below the prevailing market rate may be sold
at
a discount below their stated principal amount.
Terms
Specified in the Applicable Prospectus Supplement
The
applicable prospectus supplement will contain, where applicable, the following
terms of and other information relating to any offered debt
securities:
|
·
|
the
specific designation;
|
|
·
|
the
aggregate principal amount of the debt
securities;
|
|
·
|
the
indenture under which the debt securities are
issued;
|
|
·
|
applicable
subordination provisions, if any;
|
|
·
|
percentage
or percentages of principal amount at which the debt securities will
be
issued;
|
|
·
|
the
currency in which the debt securities are denominated and/or in which
principal, premium, if any, and/or interest, if any, are
payable;
|
|
·
|
the
date of maturity;
|
|
·
|
the
interest rate or rates or the method by which the calculation agent
will
determine the interest rate or rates, if
any;
|
|
·
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the
dates on which interest will accrue or the method for determining
dates on
which interest will accrue and dates on which interest will be
payable;
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the
place or places for payment of the principal of and any premium and/or
interest on the debt securities;
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any
repayment, redemption, prepayment or sinking fund provisions, including
any redemption notice provisions;
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whether
we will issue the debt securities in registered form or bearer form
or
both and, if we are offering debt securities in bearer form, any
restrictions applicable to the exchange of one form for another and
to the
offer, sale and delivery of those debt securities in bearer
form;
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whether
the securities will be issued in whole or in part in the form of
one or
more global securities;
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the
identity of the global depositary;
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the
terms on which holders of the debt securities may convert or exchange
these securities into or for ordinary shares or other of our securities
or
of an entity unaffiliated with us, any specific terms relating to
the
adjustment of the conversion or exchange feature and the period during
which the holders may make the conversion or
exchange;
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information
as to the methods for determining the amount of principal or interest
payable on any date and/or the currencies, securities or baskets
of
securities, commodities or indices to which the amount payable on
that
date is linked;
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25
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any
agents for the debt securities, including trustees, depositaries,
authenticating or paying agents, transfer agents or
registrars;
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whether
and under what circumstances the issuer will pay additional amounts
on
debt securities for any tax, assessment or governmental charge withheld
or
deducted and, if so, whether we will have the option to redeem those
debt
securities rather than pay the additional
amounts;
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any
material English, U.S. federal and, if applicable, Bermuda income
tax
consequences, including, but not limited
to:
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tax
considerations applicable to any discounted debt securities or to
debt
securities issued at par that are treated as having been issued at
a
discount for United States federal income tax purposes;
and
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tax
considerations applicable to any debt securities denominated and
payable
in foreign currencies;
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whether
the debt securities will be
secured;
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any
applicable selling restrictions;
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whether
the securities issued will be entitled to the benefits of guarantees;
and
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any
other specific terms of the debt securities, including any modifications
to or additional events of default, covenants or modified or eliminated
acceleration rights, and any terms required by or advisable under
applicable laws or regulations.
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Some
of
the debt securities may be issued as original issue discount
securities. Original issue discount securities bear no interest or
bear interest at below-market rates and may be sold at a discount below their
stated principal amount. The applicable prospectus supplement will
contain information relating to income tax, accounting and other special
considerations applicable to original issue discount securities.
Registration
and Transfer of Debt Securities
Holders
may present debt securities for exchange, and holders of registered debt
securities may present these securities for transfer, in the manner, at the
places and subject to the restrictions stated in the debt securities and
described in the applicable prospectus supplement. The issuer will
provide these services without charge except for any tax or other governmental
charge payable in connection with these services and subject to any limitations
or requirements provided in the applicable indenture or the supplemental
indenture or issuer order under which that series of debt securities is
issued. Holders may transfer debt securities in bearer form and/or
the related coupons, if any, by delivery to the transferee. If any of
the securities are held in global form, the procedures for transfer of interests
in those securities will depend upon the procedures of the depositary for those
global securities.
Events
of Default
Each
indenture provides holders of debt securities with remedies if the issuer and/or
guarantors, as the case may be, fail to perform specific obligations, such
as
making payments on the debt securities, or if the issuer and/or guarantors,
as
the case may be, become bankrupt. Holders should review these
provisions and understand which actions trigger an event of default and which
actions do not. Each indenture permits the issuance of debt
securities in one or more series, and, in many cases, whether an event of
default has occurred is determined on a series-by-series basis.
26
An
event
of default is defined under the indentures, with respect to any series of debt
securities issued under that indenture, as any one or more of the following
events, subject to modification in a supplemental indenture, each of which
we
refer to in this prospectus as an event of default, having occurred and
continuing:
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default
is made in the payment of the principal or any premium in respect
of the
securities;
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default
is made for more than 30 days in the payment of interest in respect
of the
securities;
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the
issuer and/or guarantors, as the case may be, fail to perform or
observe
any of their other obligations under the securities and this failure
has
continued for the period of 60 days after we receive notice of default
stating we are in breach;
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the
issuer’s and/or guarantors’, as the case may be, bankruptcy, insolvency or
reorganization under any applicable bankruptcy, insolvency or
insolvency-related reorganization
law;
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an
order is made or an effective resolution is passed for the winding
up or
liquidation of the issuer and/or guarantors, as the case may be;
or
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any
other event of default provided in the supplemental indenture or
issuer
order, if any, under which that series of debt securities is
issued.
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Acceleration
of Debt Securities upon an Event of Default
Each
indenture provides that, unless otherwise set forth in a supplemental
indenture:
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if
an event of default due to the default in payment of principal of,
or any
premium or interest on, any series of debt securities issued under
the
indenture, or due to the default in the performance or breach of
any other
covenant or warranty of the issuer and/or guarantor, as the case
may be,
applicable to that series of debt securities but not applicable to
all
outstanding debt securities issued under that indenture occurs and
is
continuing, either the trustee or the holders of not less than 25%
in
aggregate principal amount of the outstanding debt securities of
each
affected series, voting as one class, by notice in writing to the
issuer
and guarantor, as the case may be, may declare the principal of and
accrued interest on the debt securities of such affected series (but
not
any other debt securities issued under that indenture) to be due
and
payable immediately;
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if
an event of default occurs due to specified events of bankruptcy,
insolvency or reorganization of the issuer and/or the guarantor,
as the
case may be, the principal of all debt securities and interest accrued
on
the debt securities shall be due and payable immediately;
and
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if
an event of default due to a default in the performance of any other
of
the covenants or agreements in the indenture applicable to all outstanding
debt securities issued under the indenture occurs and is continuing,
either the trustee or the holders of not less than 25% in aggregate
principal amount of all outstanding debt securities issued under
the
indenture for which any applicable supplemental indenture does not
prevent
acceleration under the relevant circumstances, voting as one class,
by
notice in writing to the issuer and/or guarantor, as the case may
be, may
declare the principal of all debt securities and interest accrued
on the
debt securities to be due and payable
immediately.
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Annulment
of Acceleration and Waiver of Defaults
In
some
circumstances, if any and all events of default under the indenture, other
than
the non-payment of the principal of the securities that has become due as a
result of an acceleration, have been cured, waived or otherwise remedied, then
the holders of a majority in aggregate principal amount of all series of
outstanding debt securities affected, voting as one class, may annul past
declarations of acceleration or waive past defaults of the debt
securities.
27
Indemnification
of Trustee for Actions Taken on Your Behalf
Each
indenture provides that the trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance with
the
direction of the holders of debt securities issued under that indenture relating
to the time, method and place of conducting any proceeding for any remedy
available to the trustee, or exercising any trust or power conferred upon the
trustee. In addition, each indenture contains a provision entitling
the trustee, subject to the duty of the trustee to act with the required
standard of care during a default, to be indemnified by the holders of debt
securities issued under the indenture before proceeding to exercise any right
or
power at the request of holders. Subject to these provisions and
specified other limitations, the holders of a majority in aggregate principal
amount of each series of outstanding debt securities of each affected series,
voting as one class, may direct the time, method and place of conducting any
proceeding for any remedy available to the trustee, or exercising any trust
or
power conferred on the trustee.
Limitation
on Actions by You as an Individual Holder
Each
indenture provides that no individual holder of debt securities may institute
any action against us under that indenture, except actions for payment of
overdue principal and interest, unless the following actions have
occurred:
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the
holder must have previously given written notice to the trustee of
the
continuing default;
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the
holders of not less than 25% in aggregate principal amount of the
outstanding debt securities of each affected series, treated as one
class,
must have:
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requested
the trustee to institute that action
and
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offered
the trustee reasonable indemnity;
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the
trustee must have failed to institute that action within 60 days
after
receipt of the request referred to above;
and
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the
holders of a majority in principal amount of the outstanding debt
securities of each affected series, voting as one class, must not
have
given directions to the trustee inconsistent with those of the holders
referred to above.
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Each
indenture contains a covenant that the issuer and guarantors, if applicable,
will file annually with the trustee a certificate of no default or a certificate
specifying any default that exists.
Discharge,
Defeasance and Covenant Defeasance
The
issuer has the ability to eliminate most or all of its obligations on any series
of debt securities prior to maturity if it complies with the following
provisions:
Discharge
of
Indenture. The issuer
may
discharge all of its obligations, other than as to transfers and exchanges,
under the indenture after it has:
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paid
or caused to be paid the principal of and interest on all of the
outstanding debt securities in accordance with their
terms;
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delivered
to the applicable trustee for cancellation all of the outstanding
debt
securities; or
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irrevocably
deposited with the applicable trustee cash or, in the case of a series
of
debt securities payable only in U.S. dollars, U.S. government obligations
in trust for the benefit of the holders of any series of debt securities
issued under the indenture that have either become due and payable,
or are
by
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28
their
terms due and payable, or are scheduled for redemption, within one year, in
an
amount certified to be sufficient to pay on each date that they become due
and
payable, the principal of and interest on, and any mandatory sinking fund
payments for, those debt securities. However, the deposit of cash or
U.S. government obligations for the benefit of holders of a series of debt
securities that are due and payable, or are scheduled for redemption, within
one
year will discharge obligations under the applicable indenture relating only
to
that series of debt securities.
Defeasance
of a
Series of Securities at Any Time. The issuer
may
also discharge all of its obligations, other than as to transfers and exchanges,
under any series of debt securities at any time, which we refer to as defeasance
in this prospectus. The issuer may be released with respect to any
outstanding series of debt securities from the obligations imposed by the
covenants described above limiting consolidations, mergers, asset sales and
leases, and elect not to comply with those sections without creating an event
of
default. Discharge under those procedures is called covenant
defeasance.
Defeasance
or covenant defeasance may be effected only if, among other things:
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the
issuer irrevocably deposits with the relevant trustee cash or, in
the case
of debt securities payable only in U.S. dollars, U.S. government
obligations, as trust funds in an amount certified to be sufficient
to pay
on each date that they become due and payable, the principal of and
interest on, and any mandatory sinking fund payments for, all outstanding
debt securities of the series being
defeased;
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the
issuer delivers to the relevant trustee an opinion of counsel to
the
effect that:
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the
holders of the series of debt securities being defeased will not
recognize
income, gain or loss for United States federal income tax purposes
as a
result of the defeasance or covenant defeasance;
and
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the
defeasance or covenant defeasance will not otherwise alter those
holders’
United States federal income tax treatment of principal and interest
payments on the series of debt securities being defeased;
and
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in
the case of a defeasance, this opinion must be based on a ruling
of the
Internal Revenue Service or a change in United States federal income
tax
law occurring after the date of this prospectus, since that result
would
not occur under current tax law.
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Modification
of the Indenture
Modification
Without Consent of Holders. The issuer
and
the relevant trustee may enter into supplemental indentures without the consent
of the holders of debt securities issued under each indenture to:
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secure
any debt securities;
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evidence
the assumption by a successor corporation of our
obligations;
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add
covenants for the protection of the holders of debt
securities;
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cure
any ambiguity or correct any
inconsistency;
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establish
the forms or terms of debt securities of any series;
or
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evidence
the acceptance of appointment by a successor
trustee.
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Modification
with
Consent of Holders. Each issuer
and
the trustee, with the consent of the holders of not less than a majority in
aggregate principal amount of each affected series of outstanding debt
securities, voting as
29
one
class, may add any provisions to, or change in any manner or eliminate any
of
the provisions of, the indenture or modify in any manner the rights of the
holders of those debt securities. However, the issuer and the trustee
may not make any of the following changes to any outstanding debt security
without the consent of each holder that would be affected by the
change:
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extend
the final maturity of the security;
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reduce
the principal amount;
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reduce
the rate or extend the time of payment of
interest;
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reduce
any amount payable on redemption;
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change
the currency in which the principal, including any amount of original
issue discount, premium or interest on the security is
payable;
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modify
or amend the provisions for conversion of any currency into another
currency;
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reduce
the amount of any original issue discount security payable upon
acceleration or provable in
bankruptcy;
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alter
the terms on which holders of the debt securities may convert or
exchange
debt securities for stock or other securities or for other property
or the
cash value of the property, other than in accordance with the antidilution
provisions or other similar adjustment provisions included in the
terms of
the debt securities;
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impair
the right of any holder to institute suit for the enforcement of
any
payment on any debt security when due;
or
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reduce
the percentage of debt securities the consent of whose holders is
required
for modification of the indenture.
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Form
of Debt Security
Each
debt
security will be represented either by a certificate issued in definitive form
to a particular investor or by one or more global securities representing the
entire issuance of securities. Both certificated securities in
definitive form and global securities may be issued either:
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in
registered form, where the issuer’s obligation runs to the holder of the
security named on the face of the security,
or
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in
bearer form, where the issuer’s obligation runs to the bearer of the
security.
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Definitive
securities name you or your nominee as the owner of the security, other than
definitive bearer securities, which name the bearer as owner, and in order
to
transfer or exchange these securities or to receive payments other than interest
or other interim payments, you or your nominee must physically deliver the
securities to the trustee, registrar, paying agent or other agent, as
applicable.
Global
securities name a depositary or its nominee as the owner of the debt securities
represented by these global securities, other than global bearer securities,
which name the bearer as owner. The depositary maintains a
computerized system that will reflect each investor’s beneficial ownership of
the securities through an account maintained by the investor with its
broker/dealer, bank, trust company or other representative, as we explain more
fully below.
30
Global
Securities
Registered
Global
Securities. The issuer
may
issue the debt securities in the form of one or more fully registered global
securities that will be deposited with a depositary or its nominee identified
in
the applicable prospectus supplement and registered in the name of that
depositary or nominee. In those cases, one or more registered global
securities will be issued in a denomination or aggregate denominations equal
to
the portion of the aggregate principal or face amount of the securities to
be
represented by registered global securities. Unless and until it is
exchanged in whole for securities in definitive registered form, a registered
global security may not be transferred except as a whole by and among the
depositary for the registered global security, the nominees of the depositary
or
any successors of the depositary or those nominees. If not described
below, any specific terms of the depositary arrangement with respect to any
securities to be represented by a registered global security will be described
in the prospectus supplement relating to those securities. We
anticipate that the following provisions will apply to all depositary
arrangements:
Ownership
of beneficial interests in a registered global security will be limited to
persons, called participants, that have accounts with the depositary or persons
that may hold interests through participants. Upon the issuance of a
registered global security, the depositary will credit, on its book-entry
registration and transfer system, the participants’ accounts with the respective
principal or face amounts of the securities beneficially owned by the
participants. Any dealers, underwriters or selling agents
participating in the distribution of the securities will designate the accounts
to be credited. Ownership of beneficial interests in a registered
global security will be shown on, and the transfer of ownership interests will
be effected only through, records maintained by the depositary, with respect
to
interests of participants, and on the records of participants, with respect
to
interests of persons holding through participants. The laws of some
jurisdictions may require that some purchasers of securities take physical
delivery of these securities in definitive form. These laws may
impair your ability to own, transfer or pledge beneficial interests in
registered global securities. So long as the depositary, or its
nominee, is the registered owner of a registered global security, that
depositary or its nominee, as the case may be, will be considered the sole
owner
or holder of the securities represented by the registered global security for
all purposes under the applicable indenture.
Except
as
described below, owners of beneficial interests in a registered global security
will not be entitled to have the securities represented by the registered global
security registered in their names, will not receive or be entitled to receive
physical delivery of the securities in definitive form and will not be
considered the owners or holders of the securities under the applicable
indenture. Accordingly, each person owning a beneficial interest in a
registered global security must rely on the procedures of the depositary for
that registered global security and, if that person is not a participant, on
the
procedures of the participant through which the person owns its interest, to
exercise any rights of a holder under the applicable indenture. We
understand that under existing industry practices, if we request any action
of
holders or if an owner of a beneficial interest in a registered global security
desires to give or take any action that a holder is entitled to give or take
under the applicable indenture, the depositary for the registered global
security would authorize the participants holding the relevant beneficial
interests to give or take that action, and the participants would authorize
beneficial owners owning through them to give or take that action or would
otherwise act upon the instructions of beneficial owners holding through
them.
Principal,
premium, if any, and interest payments on debt securities represented by a
registered global security registered in the name of a depositary or its nominee
will be made to the depositary or its nominee, as the case may be, as the
registered owner of the registered global security. None of the
issuer, the guarantor, if applicable, the trustee or any other agent of the
issuer, guarantor or agent of the trustee will have any responsibility or
liability for any aspect of the records relating to payments made on account
of
beneficial ownership interests in the registered global security or for
maintaining, supervising or reviewing any records relating to those beneficial
ownership interests. We expect that the depositary for any of the
securities represented by a registered global security, upon receipt of any
payment of principal, premium, interest or other distribution of underlying
securities or other property to holders on that registered global security,
will
immediately credit participants’ accounts in amounts proportionate to their
respective beneficial interests in that registered global security as shown
on
the records of the depositary. We also expect that payments by
participants to owners of beneficial interests in a registered global security
held through participants will be governed by standing customer instructions
and
customary practices, as is now the case with the securities held for the
accounts of customers in bearer form or registered in “street name,” and will be
the responsibility of those participants.
31
If
the
depositary for any of these securities represented by a registered global
security is at any time unwilling or unable to continue as depositary or ceases
to be a clearing agency registered under the Exchange Act, and a successor
depositary registered as a clearing agency under the Exchange Act is not
appointed by the issuer within 90 days, the issuer will issue securities in
definitive form in exchange for the registered global security that had been
held by the depositary. In addition, the issuer may, at any time and
in its sole discretion, decide not to have any of the securities represented
by
one or more registered global securities. If the issuer makes that
decision, it will issue securities in definitive form in exchange for all of
the
registered global security or securities representing those
securities. Any securities issued in definitive form in exchange for
a registered global security will be registered in the name or names that the
depositary gives to the relevant trustee or other relevant agent of ours or
theirs. It is expected that the depositary’s instructions will be
based upon directions received by the depositary from participants with respect
to ownership of beneficial interests in the registered global security that
had
been held by the depositary.
Bearer
Global
Securities. The securities may also be issued in the form of
one or more bearer global securities that will be deposited with a common
depositary for the Euroclear System and Clearstream Banking, societe anonyme
or
with a nominee for the depositary identified in the prospectus supplement
relating to those securities. The specific terms and procedures,
including the specific terms of the depositary arrangement, with respect to
any
securities to be represented by a bearer global security will be described
in
the prospectus supplement relating to those securities.
Guarantees
Amarin
will fully and unconditionally guarantee payment in full to the holders of
the
debt securities issued by Amarin Finance pursuant to this
prospectus. The guarantee will be set forth in, and form part of, the
indentures under which the debt securities will be issued. If, for
any reason, Amarin Finance does not make any required payment in respect of
its
debt securities when due, the Company will cause the payment to be made to
or to
the order of the trustee. The guarantee will be on a senior basis
when the guaranteed debt security is issued under a senior indenture, and on
a
subordinated basis to the extent the guaranteed debt security is issued under
a
subordinated indenture. The extent to which the guarantee is
subordinated to other indebtedness of the Company will be substantially the
same
as the extent to which the subordinated debt issued by the issuer is
subordinated to the other indebtedness of the issuer as described below under
“—Subordination of the Subordinated Debt Securities.” The holder of
the guaranteed security may sue the guarantor to enforce its rights under the
guarantee without first suing any other person or entity.
Subordination
of the Subordinated Debt Securities
Subordinated
debt securities issued by an issuer will, to the extent set forth in the
applicable subordinated indenture, be subordinate in right of payment to the
prior payment in full of all senior indebtedness of the issuer, whether
outstanding at the date of the subordinated indenture or incurred after that
date. In the event of
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any
insolvency or bankruptcy case or proceeding, or any receivership,
liquidation, reorganization or other similar case or proceeding in
connection therewith, relative to the issuer or to its creditors,
as such,
or to its assets;
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any
voluntary or involuntary liquidation, dissolution or other winding
up of
the issuer, whether or not involving insolvency or bankruptcy;
or
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|
any
assignment for the benefit of creditors or any other marshalling
of assets
and liabilities of the issuer,
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then
the
holders of senior indebtedness of the issuer will be entitled to receive payment
in full of all amounts due or to become due on or in respect of all its senior
indebtedness, or provision will be made for the payment in cash, before the
holders of the subordinated debt securities of the issuer are entitled to
receive or retain any payment on account of principal of, or any premium or
interest on, or any additional amounts with respect to, the subordinated debt
securities. The holders of senior indebtedness of the issuer will be
entitled to receive, for application to the payment
32
of
the
senior indebtedness, any payment or distribution of any kind or character,
whether in cash, property or securities, including any payment or distribution
which may be payable or deliverable by reason of the payment of any other
indebtedness of the issuer being subordinated to the payment of its subordinated
debt securities. This payment may be payable or deliverable in
respect of its subordinated debt securities in any case, proceeding,
dissolution, liquidation or other winding up event.
By
reason
of subordination, in the event of liquidation or insolvency of the issuer,
holders of senior indebtedness of the issuer and holders of other obligations
of
the issuer that are not subordinated to its senior indebtedness may recover
more
ratably than the holders of subordinated debt securities of the
issuer.
Subject
to the payment in full of all senior indebtedness of the issuer, the rights
of
the holders of subordinated debt securities of the issuer will be subrogated
to
the rights of the holders of its senior indebtedness to receive payments or
distributions of cash, property or securities of the issuer applicable to its
senior indebtedness until the principal of, any premium and interest on, and
any
additional amounts with respect to, its subordinated debt securities have been
paid in full.
No
payment of principal, including redemption and sinking fund payments, of, or
any
premium or interest on, or any additional amounts with respect to, the
subordinated debt securities of the issuer, or payments to acquire these
securities, other than pursuant to their conversion, may be made:
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if
any senior indebtedness of the issuer is not paid when due and any
applicable grace period with respect to the default has ended and
the
default has not been cured or waived or ceased to exist,
or
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if
the maturity of any senior indebtedness of the issuer has been accelerated
because of a default.
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The
subordinated indentures do not limit or prohibit the issuer from incurring
additional senior indebtedness, which may include indebtedness that is senior
to
its subordinated debt securities, but subordinate to the issuer’s other
obligations.
The
subordinated indentures provide that these subordination provisions, insofar
as
they relate to any particular issue of subordinated debt securities by the
issuer, may be changed prior to the issuance. Any change would be
described in the applicable prospectus supplement.
New
York Law to Govern
The
indentures and the debt securities will be governed by the laws of the State
of
New York.
Information
Concerning the Trustee
The
trustee to be named under the indenture, will be appointed by us as paying
agent, conversion agent, registrar and custodian with regard to the debt
securities. The trustee or its affiliates may from time to time in
the future provide banking and other services to us in the ordinary course
of
their business.
DESCRIPTION
OF ORDINARY SHARES
The
following description of our ordinary shares is only a summary. We
encourage you to read our Articles of Association, which are
incorporated by reference into the registration statement of which this
prospectus forms a part. As of the date of this prospectus, we are
authorized to issue up to 1,559,144,066 ordinary shares of 5p each and there
are
81,574,478 shares currently outstanding. In the following summary, a
“shareholder” is the person registered in our register of members as the holder
of the relevant securities. For those ordinary shares that have been
deposited in our American Depositary Receipt facility pursuant to our deposit
agreement with Citibank N.A., the depositary or its nominee is deemed the
shareholder.
33
Dividends
Holders
of ordinary shares are entitled to receive such dividends as may be declared
by
the board of directors. All dividends are declared and paid according
to the amounts paid up on the shares in respect of which the dividend is
paid. As of the date of this prospectus, there have been no dividends
paid to holders of ordinary shares.
Any
dividend unclaimed after a period of twelve years from the date of declaration
of such dividend shall be forfeited and shall revert to us. In
addition, the payment by the board of directors of any unclaimed dividend,
interest or other sum payable on or in respect of an ordinary share or a
preference share into a separate account shall not constitute us as a trustee
in
respect thereof.
Rights
in a Liquidation
Holders
of ordinary shares are entitled to participate in any distribution of assets
upon a liquidation, subject to prior satisfaction of the claims of creditors
and
preferential payments to holders of outstanding preference shares.
Voting
Rights
Voting
at
any general meeting of shareholders is by a show of hands, unless a poll is
demanded. A poll may be demanded by:
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·
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the
chairman of the meeting;
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·
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at
least two shareholders entitled to vote at the
meeting;
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·
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any
shareholder or shareholders representing in the aggregate not less
than
one-tenth of the total voting rights of all shareholders entitled
to vote
at the meeting; or
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·
|
any
shareholder or shareholders holding shares conferring a right to
vote at
the meeting on which there have been paid up sums in the aggregate
equal
to not less than one-tenth of the total sum paid up on all the shares
conferring that right.
|
In
a vote
by a show of hands, every shareholder who is present in person at a general
meeting has one vote. In a vote on a poll, every shareholder who is
present in person or by proxy shall have one vote for every share of which
they
are registered as the holder. The quorum for a shareholders’ meeting
is a minimum of two persons, present in person or by proxy. To the
extent the articles of association provide for a vote by a show of hands in
which each shareholder has one vote, this differs from U.S. law, under which
each shareholder typically is entitled to one vote per share at all
meetings.
Holders
of ADSs are also entitled to vote by supplying their voting instructions to
the
depositary who will vote the ordinary shares represented by their ADSs in
accordance with their instructions. The ability of Citibank to carry
out voting instructions may be limited by practical and legal limitations,
the
terms of our memorandum and articles of association, and the terms of the
ordinary shares on deposit. We cannot assure the holders of our ADSs
that they will receive voting materials in time to enable them to return voting
instructions to Citibank in a timely manner.
Unless
otherwise required by law or the articles of association, voting in a general
meeting is by ordinary resolution. An ordinary resolution is approved
by a majority vote of the shareholders present at a meeting at which there
is a
quorum. Examples of matters that can be approved by an ordinary
resolution include:
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·
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the
election of directors;
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·
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the
approval of financial statements;
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34
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·
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the
declaration of final dividends;
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·
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the
appointment of auditors;
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·
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the
increase of authorized share capital;
or
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·
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the
grant of authority to issue shares.
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A
special
resolution or an extraordinary resolution requires the affirmative vote of
not
less than three-fourths of the eligible votes. Examples of matters
that must be approved by a special resolution include modifications to the
rights of any class of shares, certain changes to the memorandum or articles
of
association, or our winding-up.
DESCRIPTION
OF PREFERENCE SHARES
The
following description of our preference shares is only a summary of the general
terms of the preference shares of any series we may issue under this
prospectus. Each time we issue preference shares we will prepare a
prospectus supplement, which you should read carefully. The
prospectus supplement relating to a series of preference shares or to securities
that are convertible into or exchangeable for the preference shares will
summarize the terms of the preference shares of the particular
series. Those terms will be set out in the resolutions establishing
the series that our Board of Directors or an authorized committee adopt, and
may
be different from those summarized below. If so, the applicable prospectus
supplement will state that, and the description of the preference shares of
that
series contained in the prospectus supplement will apply. In the
following summary, a “holder” is the person registered in our register of
members as the holder of the relevant securities. For those
preference shares, if any, that are deposited in an American Depositary Receipt
facility pursuant to a deposit agreement, to be entered into (for additional
details see “Description of American Depositary Shares”) with Citibank N.A., the
depositary or its nominee is deemed the shareholder.
This
summary does not purport to be complete and is subject to, and qualified by,
our
Articles of Association and the resolutions of our Board of Directors or an
authorized committee. You should read our Articles of Association
which are incorporated by reference into the registration statement of which
this prospectus is a part, as well as those resolutions, which we will file
with
the SEC as an exhibit to the registration statement, of which this prospectus
is
a part.
Currently
Amarin has 440,855,934 Preference Shares of 5p each forming part of its
authorized share capital but none of these preference shares are in
issue. Pursuant to an authority given by the shareholders at the 2005
Annual General Meeting our board of directors has the authority, without further
action by shareholders, to issue up to 440,855,934 preference shares of 5p
in
one or more series and to fix the rights, preferences, privileges,
qualifications and restrictions granted to or imposed upon the preference
shares, including dividend rights, conversion rights, voting rights, rights
and
terms of redemption, and liquidation preference, any or all of which may be
greater than the rights of the ordinary shares. To date, our board of
directors has not issued any such preference shares.
Our
board
of directors will fix the rights, preferences, privileges, qualifications and
restrictions of the preference shares of each series that we sell under this
prospectus and applicable prospectus supplements in the resolutions relating
to
that series. We will incorporate by reference into the registration
statement of which this prospectus is a part the form of any resolutions that
describes the terms of the series of preference shares we are offering before
the issuance of the related series of preference shares. This
description will include:
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·
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the
title and stated value;
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·
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the
number of shares we are offering;
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·
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the
liquidation preference per share;
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35
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·
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the
purchase price per share;
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·
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the
dividend rate per share, dividend period and payment dates and method
of
calculation for dividends;
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·
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whether
dividends will be cumulative or non-cumulative and, if cumulative,
the
date from which dividends will
accumulate;
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·
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our
right, if any, to defer payment of dividends and the maximum length
of any
such deferral period;
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·
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the
procedures for any auction and remarketing, if
any;
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·
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the
provisions for a sinking fund, if
any;
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·
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the
provisions for redemption or repurchase, if applicable, and any
restrictions on our ability to exercise those redemption and repurchase
rights;
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·
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any
listing of the preference shares on any securities exchange or
market;
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·
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whether
the preference shares will be convertible into our ordinary shares
or
other securities of ours, including warrants, and, if applicable,
the
conversion period, the conversion price, or how it will be calculated,
and
under what circumstances if may be
adjusted;
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·
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whether
the preference shares will be exchangeable into debt securities,
and, if
applicable, the exchange period, the exchange price, or how it will
be
calculated, and under what circumstances it may be
adjusted;
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·
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voting
rights, if any, of the preference
shares;
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·
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preemption
rights, if any;
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·
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restrictions
on transfer, sale or other assignment, if
any;
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·
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a
discussion of any material or special U.S. federal income tax
considerations applicable to the preference
shares;
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·
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the
relative ranking and preferences of the preference shares as to dividend
rights and rights if we liquidate, dissolve or wind up our
affairs;
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·
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any
limitations on issuances of any class or series of preference shares
ranking senior to or on a parity with the series of preference shares
being issued as to dividend rights and rights if we liquidate, dissolve
or
wind up our affairs; and
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·
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any
other specific terms, rights, preferences, privileges, qualifications
or
restrictions of the preference
shares.
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If
we
issue shares of preference shares under this prospectus, the shares will be
fully paid and non-assessable and will not have, or be subject to, any
pre-emptive or similar rights.
Our
articles of association and English law provide that the holders of preference
shares will have the right to vote separately as a class on any proposal
involving changes that would adversely affect the powers, preferences, or
special rights of holders of that series of preference
shares.
36
DESCRIPTION
OF AMERICAN DEPOSITARY SHARES
Citibank,
N.A. acts as the depositary for our American Depositary Shares representing
our
ordinary shares and will act as the depositary for any American Depositary
Shares representing our preference shares. Citibank’s depositary
offices are located at 388 Greenwich Street, New York, New York
10013. American Depositary Shares are frequently referred to as
“ADSs” and represent ownership interests in securities that are on deposit with
the depositary. ADSs are represented by certificates that are
commonly known as “American Depositary Receipts,” or “ADRs.” The
depositary typically appoints a custodian to safekeep the securities on
deposit. In this case, the custodian is the London office of
Citibank, N.A., located at Citigroup Centre, Canada Square, Canary Wharf, London
E14 5LB, England.
We
have
appointed Citibank as depositary for our ADSs representing ordinary shares
pursuant to a deposit agreement. A copy of the deposit agreement
(including any amendments) is on file with the SEC under cover of a Registration
Statement on Form F-6. You may obtain a copy of the deposit agreement
from the SEC’s Public Reference Room at 100 F Street, N.E., Room 1580,
Washington, D.C. 20549. Please refer to Registration Number
333-123653 when retrieving such copy. We will appoint Citibank
as depositary pursuant to a new deposit agreement if we determine to offer
and
sell preference shares represented by ADSs, which deposit agreement will be
filed with the SEC under cover of a Registration Statement on Form
F-6.
We
are
providing you with a summary description of the material terms of the ADSs
representing ordinary shares and of the material rights of owners of ADSs
representing ordinary shares. We expect that the material terms of
any ADSs representing preference shares and the material rights of owners of
any
ADSs representing preference shares will be similar to the material terms of
the
ADSs representing ordinary shares and the material rights of owners of ADSs
representing ordinary shares, as provided in the following summary. A
summary description of any differences in such material terms and
material rights from the description set forth below will be included in a
prospectus supplement. Please remember that summaries by their nature
lack the precision of the information summarized and that a holder’s rights and
obligations as an owner of ADSs will be determined by reference to the terms
of
the applicable deposit agreement and not by this summary. If you
intend to hold ADSs, we urge you to review the applicable deposit agreement
(including any amendments) in its entirety. Each ADS
representing ordinary shares represents one ordinary share on deposit with
the
custodian and any ADS representing preference shares will represent one
preference share on deposit with the custodian. An ADS will also
represent any other property received by the depositary or the custodian on
behalf of the owner of the ADS but that has not been distributed to the owners
of ADSs because of legal restrictions or practical considerations.
If
you
become an owner of ADSs, you will become a party to the applicable deposit
agreement and therefore will be bound to its terms and to the terms of the
ADR
that represents your ADSs. The deposit agreement and the ADR specify
our rights and obligations as well as your rights and obligations as owner
of
ADSs and those of the depositary. As an ADS holder you appoint the
depositary to act on your behalf in certain circumstances. The
deposit agreement and the ADRs are governed by New York law. However,
our obligations to the holders of ordinary shares and to the holders of
preference shares will continue to be governed by the laws of England and Wales,
which may be different from the laws in the United States.
As
an
owner of ADSs, you may hold your ADSs either by means of an ADR registered
in
your name or through a brokerage or safekeeping account. If you
decide to hold your ADSs through your brokerage or safekeeping account, you
must
rely on the procedures of your broker or bank to assert your rights as ADS
owner. Please consult with your broker or bank to determine what
those procedures are. This summary description assumes you have opted
to own the ADSs directly by means of an ADR registered in your name and, as
such, we will refer to you as the holder. When we refer to you, we
assume the reader owns ADSs and will own ADSs at the relevant time.
Dividends
and Distributions
As
a
holder, you generally have the right to receive the distributions we make on
the
securities deposited with the custodian. Your receipt of these
distributions may be limited, however, by practical considerations and legal
limitations. Holders will receive such distributions under the terms
of the deposit agreement in proportion to the number of ADSs held as of a
specified record date.
37
Distributions
of Cash
Upon
receipt of a cash dividend or other cash distribution, the depositary will
arrange for the funds to be converted into U.S. dollars and for the distribution
of the U.S. dollars to the holders, subject to English laws and
regulations.
The
conversion into U.S. dollars will take place only if this can be done on a
reasonable basis, in the judgment of the depositary, and if the U.S. dollars
are
transferable to the United States. The amounts distributed to holders
will be net of the fees, expenses, taxes and governmental charges payable by
holders under the terms of the deposit agreement. The depositary will
apply the same method for distributing the proceeds of the sale of any property,
such as undistributed rights, held by the custodian in respect of securities
on
deposit.
Distributions
of Shares
Upon
receipt of a free distribution of ordinary shares or preference shares, the
depositary will either
distribute to holders new ADSs representing the ordinary shares or preference
shares deposited with the custodian or modify the ratio
of ADSs
to ordinary shares or preference shares, in which case each ADS you hold will
represent rights and interests in the additional ordinary shares or preference
shares so deposited. Only whole new ADSs will be
distributed. Fractional entitlements will be sold and the proceeds of
such sale will be distributed as in the case of a cash
distribution.
The
distribution of new ADSs or the modification of the ratio of ADSs to ordinary
shares or preference shares upon a distribution of ordinary shares or preference
shares will be made net of the fees, expenses, taxes and governmental charges
payable by holders under the terms of the deposit agreement. In order
to pay such taxes or governmental charges, the depositary may sell all or a
portion of the new ordinary shares or preference shares so
distributed.
No
such
distribution of new ADSs will be made if it would violate the U.S. securities
laws or other applicable law. If the depositary does not distribute
new ADSs or change the ADS-to-ordinary share ratio as described above, it may
sell the ordinary shares received and distribute the proceeds of the sale as
in
the case of a distribution of cash.
Distributions
of Rights
In
the
event that we distribute rights to purchase additional ordinary shares or
preference shares, the depositary will determine whether it is lawful and
feasible to distribute rights to purchase additional ADSs to
holders.
The
depositary will establish procedures to distribute rights to purchase additional
ADSs to holders and to enable such holders to exercise such rights if it is
lawful and feasible to make the rights available to holders of
ADSs. We may be required to provide certain documentation
contemplated in the deposit agreement, such as opinions to address the
lawfulness of the transaction. You may have to pay fees, expenses,
taxes and other governmental charges to subscribe for the new ADSs upon the
exercise of your rights.
The
depositary will not
distribute the rights to you if:
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it
is not lawful or feasible to distribute the
rights;
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we
fail to deliver satisfactory documents to the depositary;
or
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it
appears that the rights are about to
lapse.
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The
depositary will sell the rights that are not exercised or not distributed if
such sale is lawful and reasonably practicable. The proceeds of such
sale will be distributed to holders as in the case of a cash
distribution. If the depositary is unable to sell the rights, it will
allow the rights to lapse.
38
Other
Distributions
If
we
distribute property other than cash, ordinary shares, rights to
purchase additional ordinary shares, preference shares or rights to purchase
additional preference shares and if we provide all of the documentation
contemplated in the applicable deposit agreement, the depositary will distribute
the property to the holders in a manner it deems equitable and
practicable.
The
distribution will be made net of fees, expenses, taxes and governmental charges
payable by holders under the terms of the deposit agreement. In order
to pay such taxes and governmental charges, the depositary may sell all or
a
portion of the property received.
If
in the
opinion of the depositary a distribution is not feasible, it will not distribute the property
to you and may sell the property with our reasonable approval. The
depositary may deem a distribution not to be feasible if:
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any
amounts are required to be withheld for taxes or governmental
charges;
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any
obligations arise under applicable securities laws of exchange control
laws; or
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·
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there
is any requirement that distributable securities be registered under
the
Securities Act of 1933 or
otherwise.
|
The
proceeds of such a sale will be distributed to holders as in the case of a
cash
distribution.
Changes
Affecting Ordinary Shares and Preference Shares
The
ordinary shares or preference shares held on deposit for your ADSs may change
from time to time. For example, there may be a change in nominal or
par value, a split-up, cancellation, consolidation or reclassification of such
ordinary shares or preference shares or a recapitalization, reorganization,
merger, consolidation or sale of assets.
If
any
such change were to occur, your ADSs would represent the right to receive the
property received or exchanged in respect of the ordinary shares or preference
shares held on deposit. The depositary may in such circumstances
deliver new ADSs to you or call for the exchange of your existing ADSs for
new
ADSs. If the depositary may not lawfully distribute such property to
you, the depositary may sell such property and distribute the net proceeds
to
you as in the case of a cash distribution.
Issuance
of ADSs upon Deposit of Ordinary Shares or Preference Shares
The
depositary may create ADSs on your behalf if you or your broker deposits
ordinary shares or preferences shares with the custodian. The
depositary will deliver these ADSs to the person you indicate only after you
pay
any applicable issuance fees and any charges and taxes payable for the transfer
of the ordinary shares or preference shares to the custodian. Your
ability to deposit ordinary shares or preference shares and receive ADSs may
be
limited by U.S. and UK legal considerations applicable at the time of
deposit. Neither ordinary shares nor preference shares will be
accepted for deposit until the depositary receives evidence that there has
been
compliance with English currency exchange regulations. The depositary
will only issue ADSs in whole numbers.
When
you
make a deposit of ordinary shares or preference shares, you will be responsible
for transferring good and valid title to the depositary. As such, you
will be deemed to represent and warrant that:
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the
ordinary shares or preference shares are validly issued, fully paid
and
non-assessable;
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·
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all
preemptive rights, if any, with respect to such ordinary shares or
preference shares have been validly waived or
exercised;
|
39
|
·
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you
are duly authorized to deposit the ordinary shares or preference
shares,
as applicable; and
|
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·
|
the
ordinary shares or preference shares presented for deposit have not
been
stripped of any rights or
entitlements.
|
In
addition, unless you are depositing ordinary shares or preference shares in
exchange for ADSs that are restricted ADSs, you will also be deemed to represent
that the ordinary shares or preference shares presented for deposit are not
restricted securities as defined in the deposit agreement.
Withdrawal
of Shares upon Cancellation of ADSs
As
a
holder, you will be entitled to present your ADSs to the depositary for
cancellation and then receive the corresponding number of underlying ordinary
shares or preference shares at the custodian’s offices. Your ability
to withdraw the ordinary shares or preference shares, as applicable,
may be limited by U.S. and UK legal considerations applicable at the time of
withdrawal. In order to withdraw the ordinary shares or preference
shares represented by your ADSs, you will be required to pay the depositary
the
fees for cancellation of ADSs and any charges and taxes payable in connection
with the surrender and withdrawal. You assume the risk for delivery
of all funds and securities upon withdrawal. Once canceled, the ADSs
will not have any rights under the deposit agreement.
If
you
hold an ADR registered in your name, the depositary may ask you to provide
proof
of identity and genuineness of any signature and such other documents as the
depositary may deem appropriate before it will cancel your ADSs. The
withdrawal of the ordinary shares or preference shares represented by your
ADSs
may be delayed until the depositary receives satisfactory evidence of compliance
with all applicable laws and regulations. Please keep in mind that
the depositary will only accept ADSs for cancellation that represent a whole
number of securities on deposit.
You
will
have the right to withdraw the securities represented by your ADSs at any time
except for:
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temporary
delays that may arise because (i) the transfer books for the ordinary
shares or preference shares, as applicable, or ADSs are closed, or
(ii) ordinary shares or preference shares are immobilized on account
of a shareholders’ meeting or a payment of
dividends;
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·
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obligations
to pay fees, taxes and similar charges would arise as a result of
such
withdrawal; or
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·
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restrictions
may be imposed because of laws or regulations applicable to ADSs
or the
withdrawal of securities on
deposit.
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The
deposit agreement may not be modified to impair your right to withdraw the
securities represented by your ADSs.
Restricted
ADSs
Each
holder depositing ordinary shares that constitute “restricted securities” (as
defined in the deposit agreement) with the depositary will receive restricted
ADRs evidencing restricted ADSs pursuant to and in accordance with the letter
agreement between the depositary and us dated as of March 29, 2006 (the
“Restricted ADR Letter Agreement”). We entered into the Restricted
ADR Letter Agreement to, inter
alia, establish procedures for (i) the deposit of “restricted securities”
with the depositary, (ii) the issuance by the depositary of restricted
ADRs
representing restricted ADSs related to such restricted securities and (iii)
the
transfer or exchange of interests in the restricted ADSs, including the
certifications and other requirements that will be required to affect such
transactions under various circumstances.
Restricted
ADRs will be issued in certificated form with a restrictive legend and may
only
be transferred or exchanged in accordance with the Restricted ADR Letter
Agreement. Except as set forth in the Restricted ADR Letter Agreement
and except as required by applicable law, restricted ADRs will have the same
rights and obliga-
40
tions
and
will be treated as ADRs that are not “restricted ADRs” for all other
purposes. Restricted ADRs may not be transferred except pursuant to
an effective registration statement under the Securities Act of 1933 or an
available exemption from the registration requirements of the Securities Act
of
1933.
Voting
Rights
As
a
holder of ADSs representing ordinary shares, you generally have the right under
the deposit agreement to instruct the depositary to exercise the voting rights
for the ordinary shares represented by your ADSs. The voting rights
of holders of ordinary shares are described in “Description of Ordinary
Shares.” Holders of ADSs representing preference shares will
generally have the right to instruct the depositary to exercise the voting
rights for the preference shares represented by their ADSs. Holders
of any series of preference shares will have voting rights, if any, fixed by
our
Board of Directors and described in the prospectus supplement relating to such
series of preference shares. Our articles of association and English
law provide that the holders of any series of preference shares will have the
right to vote separately as a class on any proposal involving changes that
would
adversely affect the powers, preferences, or special rights of holders of such
series of preference shares.
The
depositary will mail to you any notice of shareholders’ meetings received from
us, together with a statement that holders will be entitled to instruct the
depositary to exercise the voting rights of the securities represented by ADSs,
and information explaining how to give such instructions.
If
the
depositary timely receives voting instructions from a holder of ADSs, it will
endeavor to vote the securities represented by the holder’s ADSs in accordance
with such voting instructions.
If
no
such instructions are received, the depositary will deem the holders to have
granted a discretionary proxy to the person designated by us, unless we request
otherwise. However, no discretionary proxy will be deemed granted for
any proposition that:
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involves
the solicitation of opposing proxies or other substantial opposition;
or
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authorizes
a merger, consolidation or other matter that may materially affect
the
rights and privileges of holders.
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The
depositary has agreed to appoint one or more representatives to vote at
shareholders’ meetings either on a show of hands or a poll. In
general, proxies may be voted only if a vote on a poll is duly
demanded. See “Description of Ordinary Shares—Voting
Rights.” The depositary will not join in demanding a vote on a poll
unless instructed by at least two holders or holders owning at least 10% of
the
voting interests of all holders. If a poll is not demanded, the
depositary shall follow the instructions of a majority in interest of the
holders.
Please
note that the ability of the depositary to carry out voting instructions may
be
limited by practical and legal limitations, the terms of our memorandum and
articles of association, and the terms of the securities on
deposit. We cannot assure you that you will receive voting materials
in time to enable you to return voting instructions to the depositary in a
timely manner. Securities for which no voting instructions have been
received will not be voted.
Fees
and Charges
As
an ADS
holder, under the deposit agreement you will be required to pay the following
service fees to the depositary:
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Service
|
Fees
|
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Issuance
of ADSs
|
Up
to 5¢ per ADS issued (or portion thereof)
|
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Cancellation/Surrender
of ADSs
|
Up
to 5¢ per ADS canceled (or portion
thereof)
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41
However,
pursuant to a letter agreement we entered into with the depositary as of March
21, 2005, the depositary has agreed to (i) waive the fees indicated above
relating to the issuance of ADSs in lieu of an annual maintenance fee payable
by
us and (ii) reduce the cancellation/surrender fees indicated above to the
following fees depending upon the price of the ADSs then-quoted on
NASDAQ:
|
ADS
price on NASDAQ
|
Cancellation/Surrender
Fee per ADS
|
|
|
$0.00
- $5.00
|
1.5¢
|
|
|
$5.01
- $10.00
|
2.0¢
|
|
|
$10.01
and above
|
3.0¢
|
This
letter agreement and the fee waivers and reductions contained in the letter
agreement may be terminated under certain circumstances by the
depositary.
As
an ADS
holder you will also be responsible to pay certain fees and expenses incurred
by
the depositary and certain taxes and governmental charges such as:
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fees
for the transfer and registration of ordinary shares or preference
shares
charged by the registrar and transfer agent for the ordinary shares
or
preference shares in England (i.e., upon
deposit and
withdrawal of ordinary shares or preference
shares);
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expenses
incurred for converting foreign currency into U.S.
dollars;
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·
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expenses
for cable, telex and fax transmissions and for delivery of securities;
and
|
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taxes
and duties upon the transfer of securities (i.e., when
ordinary
shares or preference shares are deposited or withdrawn from
deposit).
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We
have
agreed to pay certain other charges and expenses of the
depositary. Note that the fees and charges you may be required to pay
may vary over time and, as with the letter agreement of March 31, 2005, may
be
changed by us and by the depositary. You will receive prior notice of
such changes.
Amendments
and Termination
We
may
agree with the depositary to modify the applicable deposit agreement at any
time
without your consent. We undertake to give holders three months’
prior notice of any modifications that would prejudice any substantial rights
of
the holders under the deposit agreement. We will not consider to be
prejudicial to your substantial rights any modifications or supplements that
are
reasonably necessary for the ADSs to be registered under the Securities Act
of
1933 or to be eligible for book-entry settlement, in each case without imposing
or increasing the fees and charges you are required to pay.
You
will
be bound by the modifications to the applicable deposit agreement if you
continue to hold your ADSs after the modifications to the deposit agreement
become effective. The applicable deposit agreement cannot be amended
to prevent you from withdrawing the ordinary shares or preference shares
represented by your ADSs.
We
have
the right to direct the depositary to terminate the deposit
agreement. Similarly, the depositary may in certain circumstances on
its own initiative terminate the deposit agreement. In either case,
the depositary must give notice to the holders at least 30 days before
termination.
Upon
termination of the applicable deposit agreement, withdrawal of the ordinary
shares or preference shares and distributions to holders will occur as described
below.
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For
a period of six months after termination, you will be able to request
the
cancellation of your ADSs and the withdrawal of the ordinary shares
or
preference shares represented by your ADSs and the delivery of all
other
property held by the depositary in respect of those ordinary shares
or
preference
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42
shares
on
the same terms as prior to the termination. During such six-month
period the depositary will continue to collect all distributions received on
the
ordinary shares or preference shares on deposit (i.e., dividends) but
will not
distribute any such property to you until you request the cancellation of your
ADSs.
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After
the expiration of such six-month period, the depositary may sell
the
securities held on deposit. The depositary will hold the
proceeds from such sale and any other funds then held for the holders
of
ADSs in a non-interest bearing account. At that point, the
depositary will have no further obligations to holders other than
to
account for the funds then held for the holders of ADSs still
outstanding.
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Books
of Depositary
The
depositary will maintain ADS holder records at its depositary
office. You may inspect such records at such office at reasonable
times, but solely for the purpose of communicating with other holders in the
interest of business matters of our company or relating to the ADSs or the
deposit agreement.
The
depositary will maintain facilities in New York City to record and process
the
execution, delivery, registration, transfer and surrender of
ADRs. These facilities may be closed from time to time when deemed
expedient by the depositary, or at our request.
Limitations
on Obligations and Liabilities
The
deposit agreement limits our obligations and the depositary’s obligations to
you. Please note the following:
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we
and the depositary are obligated only to use our best judgment and
good
faith in performing the duties specifically stated in the deposit
agreement without negligence or bad
faith;
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the
depositary disclaims any liability for any failure to carry out voting
instructions, for any manner in which a vote is cast or for the effect
of
any vote, provided it acts in good
faith;
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we
and the depositary will not be obligated to appear in, prosecute
or defend
any lawsuit or other proceeding unless satisfactory indemnity is
provided
against all expenses and liabilities;
and
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we
and the depositary disclaim any liability for any action or inaction
in
reliance on the advice or information received from legal counsel,
accountants, any person presenting ordinary shares for deposit, any
holder
of ADRs, or any other person believed by either of us in good faith
to be
competent to give such advice or
information.
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Pre-Release
Transactions
The
depositary may, in certain circumstances, issue ADSs before receiving a deposit
of ordinary shares or preference shares or release ordinary shares or preference
shares before receiving ADSs. These transactions are commonly
referred to as “pre-release transactions.” The deposit agreement
limits the aggregate size of pre-release transactions and imposes a number
of
conditions on such transactions, including the need to receive collateral,
the
type of collateral required, the representations required from brokers,
etc. The depositary may retain the compensation received from the
pre-release transactions.
Taxes
You
will
be responsible for the taxes and other governmental charges payable on the
ADSs
and the securities represented by the ADSs. We, the depositary and
the custodian may deduct from any distribution the taxes and governmental
charges payable by holders and may sell any and all property on deposit to
pay
the taxes and govern-
43
mental
charges payable by holders. You will be liable for any deficiency if
the sale proceeds do not cover the taxes that are due.
The
depositary may refuse to issue ADSs, to deliver, transfer, split and combine
ADRs or to release securities on deposit until all taxes and charges are paid
by
the applicable holder. The depositary and the custodian may take
reasonable administrative actions to obtain tax refunds and reduced tax
withholding for any distributions on your behalf. However, you may be
required to provide to the depositary and to the custodian proof of taxpayer
status and residence and such other information as the depositary and the
custodian may require to fulfill legal obligations. You are required
to indemnify us, the depositary and the custodian for any claims with respect
to
taxes based on any tax benefit obtained for you.
Foreign
Currency Conversion
The
depositary will arrange for the conversion of all foreign currency received
into
U.S. dollars if in its judgment conversion can be made on a reasonable
basis. The depositary will distribute the U.S. dollars in accordance
with the terms of the deposit agreement. You may have to pay fees and
expenses incurred in converting foreign currency, such as fees and expenses
incurred in complying with currency exchange controls and other governmental
requirements.
If
the
depositary determines that the foreign currency is not convertible on a
reasonable basis, or if any required approvals are not obtainable or are not
obtained within a reasonable period, the depositary may take the following
actions in its discretion:
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convert
the foreign currency to the extent practical and lawful and distribute
the
U.S. dollars to the holders for whom the conversion and distribution
is
lawful and practical;
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distribute
the foreign currency to holders for whom the distribution is lawful
and
practical; and
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hold
the foreign currency for the applicable holders without liability
for
interest.
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CERTAIN
PROVISIONS OF ENGLISH LAW AND OF THE
COMPANY’S
MEMORANDUM AND ARTICLES OF ASSOCIATION
Capital
Calls
The
board
of directors has the authority to make calls upon the shareholders in respect
of
any money unpaid on their shares and each shareholder shall pay to us as
required by such notice the amount called on his shares. If a call
remains unpaid after it has become due and payable, and the fourteen days notice
provided by the board of directors has not been complied with, any share in
respect of which such notice was given may be forfeited by a resolution of
the
board.
Preemptive
Rights
English
law provides that shareholders have preemptive rights to subscribe to any
issuances of equity securities that are or will be paid wholly in
cash. These rights may be waived by a special resolution of the
shareholders, either generally or in specific instances, for a period not
exceeding five years. This differs from U.S. law, under which
shareholders generally do not have preemptive rights unless specifically granted
in the certificate of incorporation or otherwise. Pursuant to
resolutions passed at our annual general meeting on July 25, 2005, our directors
are duly authorized during the period ending on July 25, 2010 to exercise all
of
our powers to allot our securities and to make any offer or agreement which
would or might require such securities to be allotted after that
date. The aggregate nominal amount of the relevant securities that
may be allotted under the authority cannot exceed £75,384,762 (equivalent to
1,507,695,240 ordinary shares). Under these resolutions we are
empowered to allot such ordinary
44
shares
as
if English statutory preemption rights did not apply to such issuance and,
therefore, without first offering such ordinary shares to our existing
shareholders.
Redemption
Provisions
Subject
to the Companies Act 1985 and with the sanction of a special resolution, shares
in us may be issued with terms that provide for mandatory or optional
redemption. The terms and manner of redemption would be provided for
by the alteration of our articles of association.
Subject
to the Companies Act 1985, we may also purchase in any manner the board of
directors considers appropriate any of our own ordinary shares, Preference
Shares or any other shares of any class (including redeemable shares) at any
price.
Variation
of Rights
If
at any
time our share capital is divided into different classes of shares, the rights
of any class may be varied or abrogated with the written consent of the holders
of not less than 75% of the issued shares of the class, or pursuant to an
extraordinary resolution passed at a separate meeting of the holders of the
shares of that class. At any such separate meeting the quorum shall
be a minimum of two persons holding or representing by proxy one-third in
nominal amount of the issued shares of the class, unless such separate meeting
is adjourned, in which case the quorum at such adjourned meeting or any further
adjourned meeting shall be one person. Each holder of shares of that
class has one vote per share at such meetings.
Meetings
of Shareholders
The
board
of directors may call general meetings and general meetings may also be called
on the requisition of our shareholders representing at least one-tenth of the
voting rights in general meeting pursuant to section 368 of the Companies Act
1985. Annual general meetings are convened upon advance notice of 21
days. Extraordinary general meetings are convened upon advance notice
of 21 days or 14 days depending on the nature of the business to be
transacted.
Citibank
will mail to the holders of ADSs any notice of shareholders’ meeting received
from us, together with a statement that holders will be entitled to instruct
Citibank to exercise the voting rights of the ordinary shares represented by
ADSs and information explaining how to give such instructions.
Limitations
on Ownership
There
are
currently no UK foreign exchange controls on the payment of dividends on our
ordinary shares or the conduct of our operations. There are no
restrictions under our memorandum and articles of association or under English
law that limit the right of non-resident or foreign owners to hold or vote
our
ordinary shares, Preference Shares or ADSs.
DESCRIPTION
OF WARRANTS
Amarin
may issue warrants to purchase any other securities that may be sold under
this
prospectus or securities of third parties or other rights, including rights
to
receive payment in cash or securities based on the value, rate or price of
one
or more specified securities or indices, or any combination of the
foregoing. Warrants may be issued independently or together with any
other securities and may be attached to, or separate from, such
securities. Each series of warrants will be issued under a separate
warrant agreement to be entered into between Amarin and potentially a warrant
agent. The terms of any warrants to be issued and a description of
the material provisions of the applicable warrant agreement will be set forth
in
the applicable prospectus supplement.
45
The
applicable prospectus supplement will describe the following terms of any
warrants in respect of which this prospectus is being delivered:
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the
title of such warrants;
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the
aggregate number of such warrants;
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the
price or prices at which such warrants will be
issued;
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the
currency or currencies in which the price of such warrants will be
payable;
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the
securities or other rights, including rights to receive payment in
cash or
securities based on the value, rate or price of one or more specified
commodities, currencies, securities or indices, or any combination
of the
foregoing, purchasable upon such
warrants;
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the
date on which the right to exercise such warrants shall commence
and the
date on which such right shall
expire;
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if
applicable, the minimum or maximum amount of such warrants which
may be
exercised at any one time;
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if
applicable, the designation and terms of the securities with which
such
warrants are issued and the number of such warrants issued with each
such
security;
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if
applicable, the date on and after which such warrants and the related
securities will be separately
transferable;
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information
with respect to book-entry procedures, if
any;
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any
material English, U.S. federal and, if applicable, Bermuda income
tax
consequences;
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the
antidilution provisions of the warrants;
and
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any
other terms of such warrants, including terms, procedures and limitations
relating to the exchange and exercise of such
warrants.
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DESCRIPTION
OF PURCHASE CONTRACTS
Amarin
may issue purchase contracts for the purchase or sale of debt or equity
securities issued by Amarin or securities of third parties, a basket of such
securities, an index or indices of such securities or any combination of the
above as specified in the applicable prospectus supplement.
Each
purchase contract will entitle the holder thereof to purchase or sell, and
obligate us to sell or purchase, on specified dates, such securities, currencies
or commodities at a specified purchase price, which may be based on a formula,
all as set forth in the applicable prospectus supplement. Amarin may,
however, satisfy its obligations, if any, with respect to any purchase contract
by delivering the cash value of such purchase contract or the cash value of
the
property otherwise deliverable or, in the case of purchase contracts on
underlying currencies, by delivering the underlying currencies, as set forth
in
the applicable prospectus supplement. The applicable prospectus
supplement will also specify the methods by which the holders may purchase
or
sell such securities, currencies or commodities and any acceleration,
cancellation or termination provisions or other provisions relating to the
settlement of a purchase contract.
The
purchase contracts may require Amarin to make periodic payments to the holders
thereof or vice versa, which payments may be deferred to the extent set forth
in
the applicable prospectus supplement, and those payments
46
may
be
unsecured or prefunded on the same basis. The purchase contracts may
require the holders thereof to secure their obligations in a specific manner
to
be described in the applicable prospectus supplement. Alternatively,
purchase contracts may require holders to satisfy their obligations thereunder
when the purchase contracts are issued. Amarin’s obligation to settle
such pre-paid purchase contracts on the relevant settlement date may constitute
indebtedness. Accordingly, pre-paid purchase contracts will be issued
under either the senior indenture or the subordinated indenture.
DESCRIPTION
OF UNITS
As
specified in the applicable prospectus supplement, Amarin may issue units
consisting of one or more purchase contracts, warrants, debt securities,
ordinary shares, ADSs, preference shares and other equity securities or any
combination of such securities. The applicable prospectus supplement
will describe:
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the
terms of the units and of the purchase contracts, warrants, debt
securities, ordinary shares, ADSs, preference shares and other equity
securities comprising the units, including whether and under what
circumstances the securities comprising the units may be traded
separately;
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a
description of the terms of any unit agreement governing the units;
and
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a
description of the provisions for the payment, settlement, transfer
or
exchange of the units.
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TAXATION
The
material English, U.S. federal and, if applicable, Bermuda income tax
consequences relating to the purchase, ownership and disposition of any of
the
securities offered by this prospectus will be set forth in the prospectus
supplement offering those securities.
PLAN
OF DISTRIBUTION
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to
or through underwriters;
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to
or through dealers;
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through
agents; or
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directly
to purchasers, including our
affiliates.
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The
prospectus supplement with respect to any offering of our securities will set
forth the terms of the offering, including:
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the
name or names of any underwriters, dealers or
agents;
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the
purchase price of the securities and the net proceeds to us from
the
sale;
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any
underwriting discounts and commissions or agency fees and other items
constituting underwriters’ or agents’ compensation;
and
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any
delayed delivery arrangements.
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The
distribution of the securities may be effected from time to time in one or
more
transactions at a fixed price or prices, which may be changed, at market prices
prevailing at the time of sale, at prices related to the prevailing market
prices or at negotiated prices.
47
If
securities are sold by means of an underwritten offering, we will execute an
underwriting agreement with an underwriter or underwriters, and the names of
the
specific managing underwriter or underwriters, as well as any other
underwriters, and the terms of the transaction, including commissions, discounts
and any other compensation of the underwriters and dealers, if any, will be
set
forth in the prospectus supplement which will be used by the underwriters to
sell the securities. If underwriters are utilized in the sale of the
securities, the 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 fixed public offering prices or at varying
prices determined by the underwriters at the time of sale.
Our
securities may be offered to the public either through underwriting syndicates
represented by managing underwriters or directly by the managing
underwriters. If any underwriter or underwriters are utilized in the
sale of the securities, unless otherwise indicated in the prospectus supplement,
the underwriting agreement will provide that the obligations of the underwriters
are subject to conditions precedent and that the underwriters with respect
to a
sale of securities will be obligated to purchase all of those securities if
they
purchase any of those securities.
We
may
grant to the underwriters options to purchase additional securities to cover
over-allotments, if any, at the public offering price with additional
underwriting discounts or commissions. If we grant any over-allotment
option, the terms of any over-allotment option will be set forth in the
prospectus supplement relating to those securities.
If
a
dealer is utilized in the sales of securities in respect of which this
prospectus is delivered, we will sell those securities to the dealer as
principal. The dealer may then resell those securities to the public
at varying prices to be determined by the dealer at the time of
resale. Any reselling dealer may be deemed to be an underwriter, as
the term is defined in the Securities Act of 1933, as amended, of the securities
so offered and sold. The name of the dealer and the terms of the
transaction will be set forth in the related prospectus supplement.
Offers
to
purchase securities may be solicited by agents designated by us from time to
time. Any agent involved in the offer or sale of the securities in
respect of which this prospectus is delivered 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 prospectus supplement,
any agent will be acting on a reasonable best efforts basis for the period
of
its appointment. Any agent may be deemed to be an underwriter, as
that term is defined in the Securities Act of 1933, as amended, of the
securities so offered and sold.
Offers
to
purchase securities may be solicited directly by us and the sale of those
securities may be made by us directly to institutional investors or others,
who
may be deemed to be underwriters within the meaning of the Securities Act of
1933 as amended, with respect to any resale of those securities. The
terms of any sales of this type will be described in the related prospectus
supplement.
Underwriters,
dealers, agents and remarketing firms may be entitled under relevant agreements
entered into with us to indemnification by us against certain civil liabilities,
including liabilities under the Securities Act of 1933, as amended, that may
arise from any untrue statement or alleged untrue statement of a material fact
or any omission or alleged omission to state a material fact in this prospectus,
any supplement or amendment hereto, or in the registration statement of which
this prospectus forms a part, or to contribution with respect to payments which
the agents, underwriters or dealers may be required to make.
If
so
indicated in the prospectus supplement, we will authorize underwriters or other
persons acting as our agents to solicit offers by institutions to purchase
securities from us pursuant to contracts providing for payments and delivery
on
a future date. Institutions with which contracts of this type may be
made include commercial and savings banks, insurance companies, pension funds,
investment companies, educational and charitable institutions and others, but
in
all cases those institutions must be approved by us. The obligations
of any purchaser under any contract of this type will be subject to the
condition that the purchase of the securities shall not at the time of delivery
be prohibited under the laws of the jurisdiction to which the purchaser is
subject. The underwriters and other persons acting as our agents will
not have any responsibility in respect of the validity or performance of those
contracts.
48
One
or
more firms, referred to as “remarketing firms,” may also offer or sell the
securities, if the prospectus supplement so indicates, in connection with a
remarketing arrangement upon their purchase. Remarketing firms will
act as principals for their own accounts or as agents for
Amarin. These remarketing firms will offer or sell the securities in
accordance with a redemption or repayment pursuant to the terms of the
securities. The prospectus supplement will identify any remarketing
firm and the terms of its agreement, if any, with Amarin or any of its
subsidiaries and will describe the remarketing firm’s
compensation. Remarketing firms may be deemed to be underwriters in
connection with the securities they remarket. Remarketing firms may
be entitled under agreements that may be entered into with Amarin or any of
its
subsidiaries to indemnification by Amarin or any of its subsidiaries against
certain civil liabilities, including liabilities under the Securities Act,
and
may engage in transactions with or perform services for Amarin or any of its
subsidiaries in the ordinary course of business.
Disclosure
in the prospectus supplement of our use of delayed delivery contracts will
include the commission that underwriters and agents soliciting purchases of
the
securities under delayed contracts will be entitled to receive in addition
to
the date when we will demand payment and delivery of the securities under the
delayed delivery contracts. These delayed delivery contracts will be
subject only to the conditions that we describe in the prospectus
supplement.
In
connection with the offering of securities, persons participating in the
offering, such as any underwriters, may purchase and sell securities in the
open
market. These transactions may include over-allotment and stabilizing
transactions and purchases to cover syndicate short positions created in
connection with the offering. Stabilizing transactions consist of
bids or purchases for the purpose of preventing or retarding a decline in the
market price of the securities, and syndicate short positions involve the sale
by underwriters of a greater number of securities than they are required to
purchase from any issuer in the offering. Underwriters also may
impose a penalty bid, whereby selling concessions allowed to syndicate members
or other broker-dealers in respect of the securities sold in the offering for
their account may be reclaimed by the syndicate if the securities are
repurchased by the syndicate in stabilizing or covering
transactions. These activities may stabilize, maintain or otherwise
affect the market price of the securities, which may be higher than the price
that might prevail in the open market, and these activities, if commenced,
may
be discontinued at any time.
IN
THE
U.K. IN ADDITION TO THE COMPANIES ACT 1985, THE COMPANY IS SUBJECT TO THE
PROVISIONS OF THE FINANCIAL SERVICES AND MARKETS ACT 2000 AND THE RULES OF
THE
FINANCIAL SERVICES AUTHORITY (INCLUDING THE RULES GOVERNING THE ISSUE OF
PROSPECTUSES). AS AIM IS NOT A ‘REGULATED MARKET’ FOR THE PURPOSES OF THE
EUROPEAN UNION PROSPECTUS DIRECTIVE 2003/71/EC, FOLLOWING ADMISSION TO AIM,
THERE WILL BE VARIOUS OFFER EXEMPTIONS WHICH WILL APPLY TO THE COMPANY, WHICH
WILL ALLOW IT TO ISSUE SHARES OF THE SAME CLASS ALREADY ADMITTED TO AIM, TO
CERTAIN EXEMPT PERSONS, SUCH AS QUALIFIED INVESTORS, OR TO FEWER THAN 100
PERSONS, WITHOUT THE NEED TO PRODUCE A PROSPECTUS APPROVED BY THE FINANCIAL
SERVICES AUTHORITY. IF THE COMPANY WISHES TO ISSUE SECURITIES TO THE
PUBLIC IN THE U.K. OR ANY OTHER EU MEMBER STATE OUTSIDE ANY OF THE APPLICABLE
EXEMPTIONS, IT WILL BE REQUIRED TO ISSUE A PROSPECTUS APPROVED BY THE UK
FINANCIAL SERVICES AUTHORITY.
Amarin’s
consolidated financial statements
as of and for the years ended December 31, 2005, December 31, 2004 and December
31, 2003 incorporated in this Form F-3 by reference from our Annual Report
on
Form 20-F for the year ended December 31, 2005 have been so incorporated in
reliance on the report of PricewaterhouseCoopers LLP (“PwC”), independent
registered public accounting firm, included therein given on the authority
of
said firm as experts in auditing and accounting, and in reliance on the report
of Ernst & Young LLP, independent registered public accounting firm, which
audited the financial statements of Laxdale Limited, a wholly owned subsidiary
of Amarin, as of December 31, 2004 and for the period October 9, 2004 to
December 31, 2004. PwC’s audit opinion for the consolidated financial statements
of Amarin as of and for the year ended December 31, 2004, insofar as it relates
to the amounts included for Laxdale Limited, is based solely on the report
of
Ernst & Young LLP.
49
LEGAL
MATTERS
Certain
legal matters with respect to United States and New York law with respect to
the
validity of certain of the offered securities will be passed upon for the
issuers by Cahill Gordon & Reindel llp, New York, New
York. Certain legal matters with respect to English law with respect
to the validity of certain of the offered securities will be passed upon for
the
issuers by Kirkpatrick & Lockhart Nicholson Graham LLP (registered in
England). Certain legal matters with respect to Bermuda law will be
passed upon for the issuers by Conyers Dill & Pearman. Any
underwriters will be advised about other issues relating to any offering by
their own legal counsel.
INDEMNIFICATION
FOR SECURITIES ACT LIABILITIES
As
described in the registration statement of which this prospectus forms a part,
our articles of association and certain provisions of English law contain
provisions relating to the ability of our officers and directors to be
indemnified by us for costs, charges, expenses, losses and other liabilities
which are sustained or incurred in the performance of the officer’s or
director’s duties for us. Insofar as indemnification for liabilities
arising under the Securities Act may be permitted to our directors, officers
and
controlling persons pursuant to the charter provision, by-law, contract,
arrangements, statute or otherwise, we acknowledge that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Securities Act and is, therefore, unenforceable.
50