Elanco Animal Health Inc S-3ASR, filed Jan 21, 2020
Elanco Animal Health Inc (ELAN)
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TABLE OF CONTENTS
As filed with the Securities and Exchange Commission on January 21, 2020
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Elanco Animal Health Incorporated
(Exact name of registrant as specified in its charter)
| Indiana (State or other jurisdiction of incorporation or organization) |
82-5497352 (I.R.S. Employer Identification No.) |
|
2500 Innovation Way Greenfield, Indiana, 46140 (877) 352-6261 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) |
Michael-Bryant Hicks, Esq. 2500 Innovation Way Greenfield, Indiana 46140 (877) 352-6261 (Name, address, including zip code, and telephone number, including area code, of agent for service) |
Copies to:
David S. Huntington, Esq.
Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
New York, New York 10019-6064
(212) 373-3000
Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. o
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. ý
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o
If this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Securities and Exchange Commission pursuant to Rule 462(e) under the Securities Act, check the following box. ý
If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ý | Accelerated filer o | Non-accelerated filer o |
Smaller reporting company o Emerging growth company o |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of Securities Act. o
CALCULATION OF REGISTRATION FEE
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| Title of Each Class of Securities to be Registered |
Aggregate Amount to be Registered(1) |
Proposed Maximum Offering Price per Unit(1)(2) |
Proposed Maximum Aggregate Offering Price(1)(2) |
Amount of Registration Fee(1)(3) |
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|---|---|---|---|---|---|---|---|---|
Common Stock(4) |
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Preferred Stock(4) |
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Debt Securities(4) |
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Depositary Shares(5) |
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Warrants(4) |
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Rights(4) |
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Purchase Contracts(4) |
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Units |
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- (1)
- Pursuant
to General Instruction II.E., this information is not required to be included. An indeterminate aggregate initial offering price or number of shares
of common stock, shares of preferred stock, debt securities, depositary shares, warrants, rights, purchase contracts and units of Elanco Animal Health Incorporated is being registered as may from time
to time be issued at currently indeterminable prices. Securities registered hereunder may be sold separately or together with other securities registered hereunder.
- (2)
- The
proposed maximum offering price per security will be determined from time to time by the registrant in connection with the issuance of the securities registered
by this registration statement. Prices, when determined, may be in U.S. dollars or the equivalent thereof in one or more foreign currencies, foreign currency units or composite currencies. If any debt
securities or preferred stock are issued at an original issue discount, then the amount registered will include the principal or liquidation amount of such securities measured by the initial offering
price thereof.
- (3)
- In
reliance on Rule 456(b) and Rule 457(r) under the Securities Act, Elanco Animal Health Incorporated hereby defers payment of the registration fee
required in connection with this registration statement.
- (4)
- Including
an indeterminate number of shares of common stock and preferred stock as may from time to time be issued upon conversion or exchange of debt securities or
preferred stock, or upon the exercise of warrants, rights or purchase contracts, as the case may be.
- (5)
- Each depositary share will be issued under a depositary agreement and will be evidenced by a depositary receipt.
PROSPECTUS
Elanco Animal Health Incorporated
Common Stock
Preferred Stock
Debt Securities
Depositary Shares
Warrants
Rights
Purchase Contracts
Units
We may offer and sell from time to time shares of our common stock, shares of our preferred stock, debt securities, depositary shares, warrants, rights, purchase contracts or units, or any combination thereof, in one or more offerings in amounts, at prices and on terms that we determine at the time of the offering. Each time we offer securities pursuant to this prospectus, we will provide a prospectus supplement containing more information about the particular offering together with this prospectus. The prospectus supplement or a freewriting prospectus also may add, update or change information contained in this prospectus. This prospectus may not be used to offer and sell securities without a prospectus supplement.
These securities may be sold on a continuous or delayed basis directly to or through agents, dealers or underwriters as designated from time to time, or through a combination of these methods.
Our common stock is traded on the New York Stock Exchange under the symbol "ELAN." If we decide to list or seek a quotation for any other securities, the prospectus supplement relating to those securities will disclose the exchange or market on which those securities will be listed or quoted.
Investing in these securities involves significant risks. We strongly recommend that you read carefully the risks we describe in this prospectus as well as in any accompanying prospectus supplement and the risk factors that are incorporated by reference into this prospectus from our filings made with the Securities and Exchange Commission. See "Risk Factors" beginning on page 5 of this prospectus.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is January 21, 2020.
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ABOUT THIS PROSPECTUS
This prospectus is part of an "automatic shelf" registration statement that we filed with the Securities and Exchange Commission (the "SEC") under the Securities Act of 1933, as amended (the "Securities Act"). Under this shelf registration process, we may offer and sell from time to time shares of our common stock, shares of our preferred stock, debt securities, depositary shares, warrants, rights, purchase contracts or units, or any combination thereof, in one or more offerings in amounts, at prices and on terms that we determine at the time of the offering. This prospectus provides you with a general description of the securities. Each time we offer securities, we will provide a prospectus supplement that describes the terms of the offering. The prospectus supplement also may add, update or change information contained in this prospectus. Before making an investment decision, you should read carefully both this prospectus and any prospectus supplement together with the documents incorporated by reference into this prospectus as described below under the heading "Incorporation by Reference."
The registration statement that contains this prospectus, including the exhibits to the registration statement and the information incorporated by reference, provides additional information about us and our securities. That registration statement is available on the SEC's website at www.sec.gov.
We have not authorized anyone to provide any information or to make any representations other than those contained in this prospectus supplement and accompanying prospectus, in the documents incorporated by reference into this prospectus supplement as described under "Where You Can Find More Information," in any accompanying prospectus supplement and in any free writing prospectus we may authorized to be delivered to you. We will not take any responsibility for, and can provide no assurance as to the reliability of any other information that others may give you. You should rely only on the information provided in the registration statement, this prospectus and in any prospectus supplement or freewriting prospectus related thereto, including the information incorporated by reference. We have not authorized anyone to provide you with different information. You should not assume that the information in this prospectus or any supplement to this prospectus or freewriting prospectus related thereto is accurate as of any date other than the date indicated on the cover page of this prospectus or any prospectus supplement or freewriting prospectus related thereto, as applicable. We are not making an offer to sell the securities in any jurisdiction where the offer or sale is not permitted.
We may sell the securities to or through underwriters, dealers or agents or directly to purchasers. The securities may be sold for U.S. dollars, foreign-denominated currency, currency units or composite currencies. Amounts payable with respect to any securities may be payable in U.S. dollars or foreign-denominated currency, currency units or composite currencies as specified in the applicable prospectus supplement. We and our agents reserve the sole right to accept or reject in whole or in part any proposed purchase of the securities. The prospectus supplement, which we will provide each time we offer the securities, will set forth the names of any underwriters, dealers or agents involved in the sale of the securities, and any related fee, commission or discount arrangements. See "Plan of Distribution."
The prospectus supplement may also contain information about any material U.S. federal income tax considerations relating to the securities covered by the prospectus supplement.
In this prospectus, the terms "Elanco," the "Company," "we," "us" and "our" refer to Elanco Animal Health Incorporated, unless the context requires otherwise.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and are required to file with the SEC annual, quarterly and current reports, proxy statements and other information. Such reports include our audited financial statements. Our
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publicly available filings can be found free of charge on the SEC's website at www.sec.gov. Our filings may also be found free of charge on our corporate website at www.elanco.com. Information on or accessible through our website does not constitute part of this prospectus (except for SEC reports expressly incorporated by reference herein).
As permitted by SEC rules, this prospectus does not contain all of the information we have included in the registration statement and the accompanying exhibits and schedules we file with the SEC. You may refer to the registration statement, exhibits and schedules for more information about us and the securities. The registration statement, exhibits and schedules are available through the SEC's website.
The SEC allows us to "incorporate by reference" the information we file with the SEC, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is considered to be part of this prospectus. Information that we file later with the SEC will automatically update and supersede information in this prospectus. In all cases, you should rely on the later information over different information included in this prospectus or the prospectus supplement. The following documents have been filed by us with the SEC and are incorporated by reference into this prospectus:
- •
- our Annual Report on
Form 10-K for the fiscal year ended December 31, 2018 (filed on February 20, 2019), including portions of our
Proxy Statement for the 2019 annual meeting of shareholders (filed on April 3,
2019) to the extent specifically incorporated by reference therein;
- •
- our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2019
(filed on May 14, 2019), June 30, 2019
(filed on August 13, 2019) and September 30, 2019
(filed on November 8, 2019);
- •
- our Current Reports on Form 8-K filed on
March 13, 2019 (excluding the information disclosed pursuant to
Item 7.01 and Exhibit 99.1 thereto), April 26, 2019
(excluding the information disclosed pursuant to Item 7.01 and Exhibits 99.1 and 99.2 thereto),
May 9, 2019 (excluding the information disclosed pursuant to
Items 2.02 and 7.01 and Exhibits 99.1 and 99.2 thereto), July 18,
2019 (excluding the information disclosed pursuant to Item 7.01 and Exhibit 99.1 thereto),
August 9, 2019,
August 20, 2019 (excluding the information disclosed pursuant to
Item 7.01 and Exhibits 99.1 and 99.2 thereto), September 30,
2019 (excluding the information disclosed pursuant to Item 7.01 and Exhibit 99.1 thereto),
October 17, 2019,
December 9, 2019,
December 20, 2019,
January 17, 2020 and
January 21, 2020 (Item 8.01 and the exhibits
incorporated by reference); and
- •
- the description of Elanco's capital stock set forth in Elanco's Registration Statement on Form 8-A filed on September 18, 2018, and any amendment or report filed with the SEC for the purpose of updating that description.
All reports and other documents that we subsequently file with the SEC (other than any portion of such filings that are furnished under applicable SEC rules rather than filed) pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this prospectus and before the later of (1) the completion of the offering of the securities described in this prospectus and any prospectus supplement and (2) the date we stop offering securities pursuant to this prospectus and any prospectus supplement, will be deemed to be incorporated by reference into this prospectus and to be part of this prospectus from the date of filing of such reports and documents. The information contained on our website (www.elanco.com) is not incorporated into this prospectus.
You should not assume that the information in this prospectus, the prospectus supplement, any applicable pricing supplement or any document incorporated by reference is accurate as of any date
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other than the date of the applicable document. Any statement contained in a document incorporated or deemed to be incorporated by reference into this prospectus will be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in this prospectus or any other subsequently filed document that is deemed to be incorporated by reference into this prospectus modifies or supersedes the statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
You may request a copy of any or all documents referred to above that have been or may be incorporated by reference into this prospectus (excluding certain exhibits to the documents) at no cost, by writing or calling us at the following address or telephone number:
Elanco
Animal Health Incorporated
Attention: Michael-Bryant Hicks
2500 Innovation Way
Greenfield, IN 46140
Telephone: (877) 352-6261
This prospectus and the documents incorporated by reference contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "might," "will," "may," "could," "should," "estimates," "expects," "continues," "contemplates," "anticipates," "projects," "plans," "potential," "predicts," "intends," "believes," "forecasts," "future," "assumes," and variations of such words or similar expressions are intended to identify forward-looking statements. In particular, information appearing under "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Business" includes forward-looking statements. These statements are based on management's expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed, or implied by, these forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include regional, national, or global political, economic, business, competitive, market, and regulatory conditions and the following:
- •
- heightened competition, including from innovation or generics;
- •
- the impact of disruptive innovations and advances in veterinary medical practices, animal health technologies and alternatives to
animal-derived protein;
- •
- changes in regulatory restrictions on the use of antibiotics in food animals;
- •
- our ability to implement our business strategies or achieve targeted cost efficiencies and gross margin improvements;
- •
- consolidation of our customers and distributors;
- •
- an outbreak of infectious disease carried by food animals;
- •
- the success of our research and development ("R&D") and licensing efforts;
- •
- our ability to complete acquisitions and successfully integrate the businesses we acquire, including obtaining the necessary antitrust
approvals for, and successfully integrating, the Bayer Aktiengesellschaft's ("Bayer") animal health business (the "Bayer Animal Health Business");
- •
- our ability to obtain financing for the acquisition of the Bayer Animal Health Business on favorable terms;
- •
- misuse, off-label or counterfeiting use of our products;
- •
- unanticipated safety, quality or efficacy concerns associated with our products;
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- •
- the impact of weather conditions and the availability of natural resources;
- •
- disruption in our supply chain due to manufacturing issues experienced by our contract manufacturers;
- •
- the impact of increased or decreased sales to our channel distributors resulting in higher or lower inventory levels held by them in advance of
or trailing actual customer demand, which could lead to variations in quarterly revenue results;
- •
- risks related to our presence in emerging markets;
- •
- changes in U.S. foreign trade policy, imposition of tariffs or trade disputes;
- •
- the impact of global macroeconomic conditions; and
- •
- the effect on our business resulting from our separation from Eli Lilly & Co. ("Lilly"), including the various costs associated with transition to a stand-alone entity.
There may be other factors that may cause our actual results, performance or achievements to differ materially from those expressed in, or implied by, the forward-looking statements. We can give no assurances that any of the events anticipated by the forward-looking statements will occur or, if any of them do, what impact they will have on our results of operations and financial condition. You should carefully read the factors described under the "Risk Factors" section herein, any prospectus supplement, and in the documents incorporated herein by reference.
All forward-looking statements speak only as of the date of this prospectus, even if subsequently made available by us on our website or otherwise, and are expressly qualified in their entirety by the cautionary statements included in this prospectus. We disclaim any obligation to update or revise forward-looking statements that may be made to reflect new information or future events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events, other than as required by law.
Founded in 1954 as part of Lilly, Elanco is a premier animal health company that innovates, develops, manufactures and markets products for companion and food animals. Headquartered in Greenfield, Indiana, we are the fourth largest animal health company in the world, with over $3 billion in revenue for the year ended December 31, 2018. Globally, we are #1 in medicinal feed additives, #2 in poultry, and #3 in other pharmaceuticals, which are mainly companion animal therapeutics, measured by 2018 revenue, according to Vetnosis. We offer a diverse portfolio of more than 125 brands that make us a trusted partner to veterinarians and food animal producers in more than 90 countries.
For a description of our business, financial condition, results of operations and other important information regarding Elanco, we refer you to our filings with the SEC incorporated by reference into this prospectus. For instructions on how to find copies of these documents, see "Where You Can Find More Information." More information about us is also available through our website at www.elanco.com. The information on our website is not incorporated by reference into this prospectus or any accompanying prospectus supplement (except for SEC reports that are expressly incorporated by reference herein).
Our principal executive offices are located at 2500 Innovation Way, Greenfield, Indiana 46140, telephone (877) 352-6261.
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Investing in our securities involves risk. Before you decide whether to purchase any of our securities, you should carefully consider the specific risks discussed in, or incorporated by reference into, the applicable prospectus supplement, together with all the other information contained in the prospectus supplement or incorporated by reference into this prospectus and the applicable prospectus supplement. You should also consider the risks, uncertainties and assumptions discussed under the caption "Risk Factors" included in our most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, which are incorporated by reference into this prospectus. These risk factors may be amended, supplemented or superseded from time to time by other reports we file with the SEC in the future. For more information, please see "Incorporation by Reference." These risks could materially and adversely affect our business, results of operations and financial condition and could result in a partial or complete loss of your investment.
Unless we specify another use in the applicable prospectus supplement, we will use the net proceeds from the sale of the securities offered by us for general corporate purposes, which may include, among other things:
- •
- repurchases of shares of our common stock;
- •
- debt repayment;
- •
- working capital;
- •
- research and development expenditures; and/or
- •
- capital expenditures.
We may also use such proceeds to fund acquisitions of businesses or product lines that complement our current business. We may set forth additional information on the use of net proceeds from the sale of the securities we offer under this prospectus in a prospectus supplement related to a specific offering.
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The following is a summary of Elanco's capital stock and important provisions of Elanco's amended and restated articles of incorporation and amended and restated bylaws. This summary does not purport to be complete and is subject to and qualified by Elanco's amended and restated articles of incorporation and amended and restated bylaws and by the provisions of applicable law.
Elanco's authorized capital stock is comprised of 6,000,000,000 shares, which are made up of (i) 5,000,000,000 shares of Elanco common stock and (ii) 1,000,000,000 shares of preferred stock, no par value, the rights and preferences of which may be established from time to time by Elanco's board of directors.
As of December 31, 2019, there were 373,011,513 outstanding shares of Elanco common stock and no outstanding shares of preferred stock.
Common Stock
Holders of our common stock are entitled to the rights set forth below.
Voting Rights
The holders of Elanco common stock are entitled to one vote per share on all matters submitted to a vote of Elanco's shareholders (including the election or removal of directors), and do not have cumulative voting rights. Directors are elected by a plurality of the votes entitled to be cast. Except as otherwise provided in Elanco's amended and restated articles of incorporation or as required by law, all matters to be voted on by Elanco's shareholders other than matters relating to the election and removal of directors will be approved if votes cast in favor of the matter exceed the votes cast opposing the matter at a meeting at which a majority of the outstanding shares entitled to vote on such matter is represented in person or by proxy.
Dividend Rights
Holders of Elanco common stock will share equally in any dividends that may be declared by Elanco's board of directors out of funds legally available therefor, subject to the rights of the holders of any outstanding preferred stock.
Liquidation Rights
In the event of any voluntary or involuntary liquidation, dissolution or winding up of Elanco's affairs, holders of Elanco common stock would be entitled to share ratably in Elanco's assets that are legally available for distribution to shareholders. If Elanco has any preferred stock outstanding at such time, holders of the preferred stock may be entitled to distribution and/or liquidation preferences. In either such case, Elanco must pay the applicable distribution to the holders of its preferred stock before it may pay distributions to the holders of Elanco common stock.
Other Rights
Holders of Elanco common stock do not have preemptive or other rights to subscribe for additional shares of Elanco's stock. All outstanding shares of Elanco common stock are validly issued, fully paid and nonassessable. The rights, preferences and privileges of holders of Elanco common stock will be subject to those of the holders of any shares of preferred stock that Elanco may issue in the future.
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Registration Rights
Pursuant to the Share and Asset Purchase Agreement, dated August 20, 2019 (the "Purchase Agreement"), between us and Bayer, we have agreed to issue a number of shares of our common stock, equal to approximately $2.28 billion divided by the volume weighted average trading price of our common stock on the New York Stock Exchange for the twenty consecutive trading days ending on the day before the closing of the purchase of the Bayer Animal Health Business following the satisfaction or waiver of certain conditions (the "Acquisition") (the "Consideration Shares") as part of the consideration to acquire the Bayer Animal Health Business. The number of Consideration Shares is subject to a minimum share number of 92.5% and a maximum share number of 107.5% of the baseline share number of approximately $2.28 billion divided by an initial share price of $33.60, and is subject to adjustment for dividends declared on our common stock.
In connection with our agreement to issue Bayer the Consideration Shares, we have agreed to use our reasonable best efforts to file a shelf registration statement with the SEC within 60 days after the closing date of the Acquisition. The Purchase Agreement provides that Bayer may request that we complete underwritten offerings with respect to the Consideration Shares, subject to limitations on minimum offering size. The completion of the Acquisition is subject to the satisfaction of certain customary closing conditions, including the receipt of antitrust approvals and the absence of any law or order enjoining or otherwise prohibiting the Acquisition in specified jurisdictions. Bayer will receive the Consideration Shares at completion of the Acquisition.
Registration expenses. We are generally responsible for all registration expenses in connection with the performance of our obligations under the registration rights provisions in the Purchase Agreement. We have also agreed to pay the fees and expenses of one counsel to Bayer. Bayer is responsible for any applicable underwriting discounts, selling commissions and transfer taxes applicable to the sale of the Consideration Shares.
Indemnification. Under the Purchase Agreement, we are obligated to indemnify (or make contribution to, as applicable) Bayer for certain liabilities under securities (or other similar) laws. In limited situations, Bayer is obligated to indemnify (or make contribution to, as applicable) us for losses relating to the information provided by or failed to be provided by Bayer, as applicable, in any registration statement, prospectus or related document.
Transfer. For the twelve months following the closing of the Acquisition, Bayer is subject to certain lock-up restrictions with respect to the transfer of the Consideration Shares, subject to certain specified exceptions: (i) in the three months following the closing of the Acquisition, Bayer may not transfer any portion of the Consideration Shares; (ii) from the date that is three months following the closing until the date that is six months following the closing, Bayer may transfer no more than 50% of the Consideration Shares received at closing; (iii) from the date that is six months following the closing until the date that is nine months following the closing, Bayer may transfer no more than 50%, or in the event of transfer of all of the Consideration Shares then held by Bayer, no more than 75% of the Consideration Shares received by Bayer at the closing; and (iv) from the date that is nine months following the closing date until the date that is 12 months following the closing Bayer may transfer no more than 50%, or in the event of transfer of all of the Consideration Shares then held by Bayer, no more than 75% of the Consideration Shares received at closing.
Standstill. For so long as Bayer beneficially owns four percent or more of our outstanding common stock, they will be subject to certain customary "standstill" restrictions that generally restrict them from, among other things: (i) acquiring beneficial ownership of any additional shares of our common stock; or (ii) offering or publicly announcing any tender offer, exchange offer or merger in respect of our common stock.
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Term. The registration rights will remain in effect with respect to any shares of our common stock covered by the Purchase Agreement until:
- •
- such shares have been sold pursuant to an effective registration statement under the Securities Act;
- •
- such shares have been sold pursuant to Rule 144 under the Securities Act; or
- •
- such shares may be sold pursuant to Rule 144 under the Securities Act without being subject to the volume or manner of sale restrictions in such rule and Bayer holds no more than 1% of our outstanding shares.
The foregoing description of Bayer's registration rights (and associated lock-up and standstill restrictions) pursuant to the Purchase Agreement is qualified in its entirety by reference to the Annex 27 to the Purchase Agreement, a copy of which is filed as Exhibit 4.3 hereto and is hereby incorporated by reference.
Preferred Stock
Elanco's board of directors is authorized to provide for one or more series of preferred stock and to fix the terms of such preferred stock, including the preferences, powers and relative, participating, optional or other special rights and qualifications, limitations or restrictions thereof, including the dividend rate, conversion rights, voting rights, redemption rights and liquidation preferences and to fix the number of shares to be included in any such series without any further vote or action by Elanco's shareholders. Any preferred stock so issued may rank senior to Elanco's common stock with respect to the payment of dividends or amounts upon liquidation, dissolution or winding up, or both. In addition, any such shares of preferred stock may have class or series voting rights. The issuance of preferred stock may have the effect of delaying, deferring or preventing a change in control of Elanco without further action by the shareholders and may adversely affect the voting and other rights of the holders of Elanco common stock. Elanco's board of directors has not authorized the issuance of any shares of preferred stock, and Elanco has no agreements or plans for the issuance of any shares of preferred stock.
Anti-takeover Effects of Provisions of Elanco's Amended and Restated Articles of Incorporation and Amended and Restated Bylaws
Elanco's amended and restated articles of incorporation and amended and restated bylaws contain certain provisions that may be deemed to have an anti-takeover effect and may delay, deter or prevent a tender offer or takeover attempt that a shareholder might consider in its best interest, including those attempts that might result in a premium over the market price for shares held by shareholders.
Special Meetings
Elanco's amended and restated bylaws provide that special meetings of holders of common stock may be called only by Elanco's board of directors or the Chairman of the board of directors. Holders of Elanco's common stock are not permitted to call a special meeting or to require that Elanco's board of directors call a special meeting of shareholders.
Advance Notice Procedures
Elanco's amended and restated bylaws include an advance notice procedure for the nomination, other than by or at the direction of Elanco's board of directors, of candidates for election as directors as well as for other shareholder proposals to be considered at annual meetings of shareholders. In general, Elanco's amended and restated bylaws provide that notice of intent to nominate a director or raise business at such meetings must be received by Elanco not less than 120 days nor more than
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150 days prior to the date on which Elanco's proxy statement is released to shareholders in connection with the previous year's annual meeting, or in the event that no annual meeting was held in the previous year, or the date of the annual meeting has been changed by more than 30 days from the date contemplated at the time of the previous year's proxy statement, notice by the proposing shareholder to be timely must be received not later than the close of business on the later of 120 days in advance of such meeting or 10 days following the date on which public disclosure of the date of the meeting is first made and, in each case, must contain certain specified information concerning the person to be nominated or the matters to be brought before the meeting and concerning the shareholder submitting the proposal.
Classified Board
Elanco's amended and restated articles of incorporation and Elanco's amended and restated bylaws provide for Elanco's board of directors to be divided into three classes of directors, as nearly equal in number as possible, serving staggered terms of office. Approximately one-third of Elanco's board of directors will be elected each year to three-year terms of office, and Elanco's directors (other than directors appointed by holders of preferred stock) may be removed only for cause and only upon the affirmative vote of holders of at least 662/3% of Elanco's outstanding voting stock.
Under Section 23-1-39-1 of the Indiana Business Corporation Law (the "IBCL"), only Elanco's board of directors can amend, and shareholders do not have the right to amend, Elanco's amended and restated bylaws.
Certain Provisions of the Indiana Business Corporation Law
Shareholder Action by Unanimous Written Consent
Under Chapter 29 of the IBCL, any action required or permitted to be taken by the holders of Elanco common stock may be effected only at an annual meeting or special meeting of such holders, and shareholders may act in lieu of such meetings only by unanimous written consent.
Control Share Acquisition
Elanco's amended and restated articles of incorporation provide that Chapter 42 of the IBCL does not apply to Elanco. However, Elanco could elect to be subject to Chapter 42 in the IBCL in the future. Chapter 42 of the IBCL is designed to protect minority shareholders in the event that a shareholder acquires shares of a corporation's voting stock (referred to as control shares) within one of several specified ranges (one-fifth or more but less than one-third, one-third or more but less than a majority, or a majority or more). Upon the acquisition of control shares, the approval of the rights of the acquirer to vote the shares in excess of each level of ownership (and shares acquired in transactions deemed related) must be obtained from a majority of the disinterested shareholders before the acquiring shareholder may vote such shares. Under certain circumstances, including in the event that shareholder approval is not obtained, the shares held by the acquirer may be redeemed by the corporation at the fair value of the shares as determined by the control share acquisition provision.
Certain Business Combinations
Under the business combinations provision of the IBCL, or Chapter 43, any shareholder who acquires a 10%-or-greater ownership position in an Indiana corporation with a class of voting shares registered under Section 12 of the Exchange Act (and that, like us, has not opted-out of this provision) is prohibited for a period of five years from completing a business combination (generally a merger, significant asset sale or disposition or significant issuance of additional shares) with the corporation unless, prior to the acquisition of such 10% interest, the board of directors of the corporation approved either the acquisition of such interest or the proposed business combination. If such board approval is
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not obtained, then five years after a 10% shareholder has become such, a business combination with the 10% shareholder is permitted if all provisions of the articles of the corporation are complied with and either a majority of disinterested shareholders approves the transaction or all shareholders receive a price per share determined in accordance with the fair price criteria of the business combinations provision of the IBCL. An Indiana corporation may elect to remove itself from the protection provided by the Indiana business combinations provision, but such an election remains ineffective for 18 months and does not apply to a combination with a shareholder who acquired a 10% ownership position prior to the election.
Limitations on Liability and Indemnification of Officers and Directors
Chapter 37 of the IBCL authorizes every Indiana corporation to indemnify its officers and directors under certain circumstances against liability incurred in connection with any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative and whether formal or informal, to which the officers or directors are made a party by reason of their relationship to the corporation. Officers and directors may be indemnified where they have acted in good faith; in the case of official action, the individual reasonably believed that the conduct was in the corporation's best interests and in all other cases, the individual reasonably believed that the conduct was not against the best interests of the corporation; and in the case of criminal proceedings, the individual either had reasonable cause to believe his or her conduct was lawful or no reasonable cause to believe his or her conduct was unlawful. Chapter 37 also requires every Indiana corporation to indemnify any of its officers or directors (unless limited by the articles of incorporation of the corporation) who were wholly successful, on the merits or otherwise, in the defense of any such proceeding against reasonable expenses incurred in connection with the proceeding. A corporation may also, under certain circumstances, pay for or reimburse the reasonable expenses incurred by an officer or director who is a party to a proceeding in advance of final disposition of the proceeding. Chapter 37 states that the indemnification provided for therein is not exclusive of any other rights to which a person may be entitled under the articles of incorporation, bylaws or resolutions of the board of directors or shareholders.
Elanco's amended and restated articles of incorporation and amended and restated bylaws provide for indemnification, to the fullest extent permitted by the IBCL, of Elanco's directors, officers and employees against liability and reasonable expenses that may be incurred by them, arising out of any threatened, pending or completed investigation, claim, suit or proceeding, whether civil, administrative, investigative or criminal, in which they may become involved by reason of being or having been a director, officer or employee. To be entitled to indemnification, (a) those persons must have been wholly successful in the claim or action, or (b) the board of directors, independent legal counsel or the shareholders must have determined that such persons acted in good faith in what they reasonably believed to be in Elanco's best interest, or in the case of conduct not in the individual's official capacity with Elanco, did not act in opposition to Elanco's best interest. In addition, in any criminal action, such persons must have had no reasonable cause to believe that their conduct was unlawful. Elanco's amended and restated bylaws provide for mandatory advancement of expenses to such persons provided certain conditions are met, including provision of a written undertaking to repay such advancements, should it be determined that the person is not entitled to indemnification.
The IBCL permits Elanco to purchase insurance on behalf of its directors, officers, employees and agents against liabilities arising out of their positions with us, whether or not such liabilities would be within the above indemnification provisions. Pursuant to this authority, Elanco will maintain such insurance for its directors, officers and employees and those of Elanco's subsidiaries, subject to certain exclusions and deductible and maximum amounts, against loss from claims arising in connection with their acting in their respective capacities, including claims under the Securities Act.
Transfer Agent and Registrar
The transfer agent and registrar for Elanco's common stock is Computershare Trust Company, N.A.
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DESCRIPTION OF THE DEBT SECURITIES
The following description of the debt securities sets forth certain general terms and provisions of the debt securities to which any prospectus supplement may relate. The particular terms of the debt securities offered by any prospectus supplement and the extent, if any, to which these general provisions may apply to those debt securities will be described in the prospectus supplement relating to those debt securities. Accordingly, for a description of the terms of a particular issue of debt securities, reference must be made to both the prospectus supplement relating thereto and to the following description.
We may issue debt securities from time to time in one or more series. The debt securities will be general obligations of Elanco Animal Health Incorporated. The debt securities may be fully and unconditionally guaranteed on a secured or unsecured senior or subordinated basis, jointly and severally, by guarantors, if any. In the event that any series of debt securities will be subordinated to other indebtedness that we have outstanding or may incur, the terms of the subordination will be set forth in the prospectus supplement relating to the subordinated debt securities.
Debt securities will be issued under one or more supplemental indentures to the Indenture, dated as of August 28, 2018 (the "indenture"), between us and Deutsche Bank Trust Company Americas, as trustee. A copy of the indenture has been filed with the SEC as an exhibit to the registration statement of which this prospectus is a part. The following discussion of certain provisions of the indenture is a summary only and should not be considered a complete description of the terms and provisions of the indenture. Accordingly, the following discussion is qualified in its entirety by reference to the provisions of the indenture, including the definition of certain terms used below. You should refer to the indenture for the complete terms of the debt securities.
General
The debt securities will represent direct, general obligations of Elanco Animal Health Incorporated, and:
- •
- may rank equally with other unsubordinated debt or may be subordinated to other debt we have or may incur;
- •
- may be issued in one or more series with the same or various maturities;
- •
- may be issued at a price of 100% of their principal amount or at a premium or discount;
- •
- may be issued in registered form and certificated or uncertificated form; and
- •
- may be represented by one or more global debt securities registered in the name of a designated depositary's nominee, and if so, beneficial interests in the global note will be shown on and transfers will be made only through records maintained by the designated depositary and its participants.
The aggregate principal amount of debt securities that we may authenticate and deliver is unlimited. Subject to limitations contained in the indenture, we may from time to time, without notice to or the consent of the holders of a series of debt securities, issue additional debt securities of any such series on the same terms and conditions as the debt securities of such series, except for any differences in the issue price and, if applicable, the initial interest accrual date and interest payment date; provided that if the additional debt securities are not fungible with the debt securities of such series for U.S. federal income tax purposes, such additional debt securities will have one or more separate CUSIP numbers. You should refer to the applicable prospectus supplement for the following
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terms of the debt securities of the series with respect to which that prospectus supplement is being delivered:
- •
- the title of the debt securities of the series (which will distinguish the debt securities of the series from all other debt securities);
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- any limit on the aggregate principal amount of the debt securities of the series that may be authenticated and delivered under the indenture
(except for debt securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, and except for any debt securities which are deemed never to have been
authenticated and delivered hereunder);
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- the person to whom any interest on a debt security of the series shall be payable, if other than the person in whose name that debt security
(or one or more predecessor debt securities) is registered at the close of business on the regular record date for such interest;
- •
- the date or dates on which the principal of the debt securities of the series is payable and/or the method by which such date or dates shall be
determined;
- •
- the rate or rates (or method for establishing the rate or rates) at which the debt securities of the series will bear interest, if any, the
date or dates from which such interest will accrue, the interest payment dates on which such interest will be payable and the regular record date for the interest payable on any interest payment date
(or method for establishing such date or dates);
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- the place or places where the principal of (and premium, if any) and interest on debt securities of the series will be payable;
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- the period or periods within which, the price or prices at which and the terms and conditions upon which debt securities of the series may be
redeemed, in whole or in part, at our option;
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- our obligation, if any, to redeem or purchase debt securities of the series pursuant to any sinking fund or analogous provisions or at the
option of a holder thereof and the period or periods within which, the price or prices at which and the terms and conditions upon which debt securities of the series shall be redeemed or purchased, in
whole or in part, pursuant to such obligation;
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- if other than denominations of $2,000 and any integral multiples of $1,000 in excess thereof, the denominations in which debt securities of the
series shall be issuable;
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- if other than the full principal amount thereof, the portion of the principal amount of debt securities of the series which will be payable
upon declaration of acceleration of the maturity thereof or the method by which such portion will be determined;
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- if other than such currency of the United States of America as at the time of payment is legal tender for payment of public or private debts,
the currency or currencies (including composite currencies) in which payment of the principal of (and premium, if any) and/or interest on the debt securities of the series will be payable;
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- if the principal of (and premium, if any) and/or interest on the debt securities of the series are to be payable, at our election or any
holder, in a currency or currencies (including composite currencies) other than that in which the debt securities are stated to be payable, the period or periods within which, and the terms and
conditions, upon which, such election may be made;
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- if the amounts of payments of principal of (and premium, if any) and/or interest on the debt securities of the series may be determined with
reference to an index, the manner in which such amounts shall be determined;
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- in the case of debt securities of a series the terms of which are not established, the adoption and applicability, if any, to such debt securities of any terms and conditions;
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- •
- whether the debt securities of the series shall be issued in whole or in part in the form of one or more global securities and, in such case,
the depositary for such global security or global securities;
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- any additional or different events of default that apply to debt securities of the series, and any change in the right of the trustee or the
holders of such debt securities to declare the principal thereof due and payable;
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- any additional or different covenants that apply to debt securities of the series;
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- the form of the debt securities of the series; and
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- any other terms of the series (which terms shall not contradict the provisions of the indenture).
The prospectus supplement will also describe any material U.S. federal income tax consequences or other special considerations applicable to the series of debt securities to which such prospectus supplement relates, including those applicable to:
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- debt securities with respect to which payments of principal, premium or interest are determined with reference to an index or formula
(including changes in prices of particular securities, currencies or commodities);
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- debt securities with respect to which principal or interest is payable in a foreign or composite currency;
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- debt securities that are issued at a discount below their stated principal amount, bearing no interest or interest at a rate that at the time
of issuance is below market rates or original issue discount debt securities; and
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- variable rate debt securities that are exchangeable for fixed rate debt securities.
Unless otherwise provided in the applicable prospectus supplement, securities in registered form may be transferred or exchanged at the office of the trustee at which its corporate trust business is principally administered in the United States, subject to the limitations provided in the indenture, without the payment of any service charge, other than any tax or governmental charge payable in connection therewith.
All funds that we pay to a paying agent for the payment of principal, premium or interest with respect to any debt securities that remain unclaimed at the end of two years after that principal, premium or interest will have become due and payable will be repaid to us, and the holders of those debt securities or any related coupons will thereafter look only to us for payment thereof.
Global Securities
The debt securities of a series may be issued in whole or in part in the form of one or more global securities. A global security is a debt security that represents, and is denominated in an amount equal to the aggregate principal amount of, all outstanding debt securities of a series, or any portion thereof, in either case having the same terms, including the same original issue date, date or dates on which principal and interest are due, and interest rate or method of determining interest. A global security will be deposited with, or on behalf of, a depositary, which will be identified in the prospectus supplement relating to such debt securities. Global securities may be issued in registered form and in either temporary or definitive form. Unless and until it is exchanged in whole or in part for the individual debt securities represented thereby, a global security may not be transferred except as a whole by the depositary to a nominee of the depositary, by a nominee of the depositary to the depositary or another nominee of the depositary, or by the depositary or any nominee of the depositary to a successor depositary or any nominee of such successor.
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The terms of the depositary arrangement with respect to a series of debt securities will be described in the prospectus supplement relating to such debt securities. We anticipate that the following provisions will generally apply to depositary arrangements, in all cases subject to any restrictions or limitations described in the prospectus supplement relating to such debt securities.
Upon the issuance of a global security, the depositary for such global security will credit, on its book entry registration and transfer system, the respective principal amounts of the individual debt securities represented by such global security to the accounts of persons that have accounts with the depositary. Such accounts will be designated by the dealers or underwriters with respect to such debt securities or, if such debt securities are offered and sold directly by us or through one or more agents, by us or such agents. Ownership of beneficial interests in a global security will be limited to participants or persons that hold beneficial interests through participants. Ownership of beneficial interests in such global security will be shown on, and the transfer of that ownership will be effected only through, records maintained by the depositary (with respect to interests of participants) or records maintained by participants (with respect to interests of persons other than participants). The laws of some states require that certain purchasers of securities take physical delivery of such securities in definitive form. Such limitations and laws may impair the ability to transfer beneficial interests in a global security.
So long as the depositary for a global security, or its nominee, is the registered owner or holder of such global security, such depositary or nominee, as the case may be, will be considered the sole owner or holder of the individual debt securities represented by such global security for all purposes under the indenture. Except as provided below, owners of beneficial interests in a global security will not be entitled to have any of the individual debt securities represented by such global security registered in their names, will not receive or be entitled to receive physical delivery of any of such debt securities in definitive form and will not be considered the owners or holders thereof under the indenture.
Payments of principal, premium and interest with respect to individual debt securities represented by a global security will be made to the depositary or its nominee, as the case may be, as the registered owner or holder of such global security. Neither we, the trustee, any paying agent or registrar for such debt securities nor any agent of ours or the trustee will have any responsibility or liability for:
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- any aspect of the records relating to or payments made by the depositary, its nominee or any participants on account of beneficial interests in
the global security or for maintaining, supervising or reviewing any records relating to such beneficial interests;
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- the payment to the owners of beneficial interests in the global security of amounts paid to the depositary or its nominee; or
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- any other matter relating to the actions and practices of the depositary, its nominee or its participants.
Neither we, the trustee, any paying agent or registrar for such debt securities nor any agent of ours or the trustee will be liable for any delay by the depositary, its nominee or any of its participants in identifying the owners of beneficial interests in the global security, and we and the trustee may conclusively rely on, and will be protected in relying on, instructions from the depositary or its nominee for all purposes.
We expect that the depositary for a series of debt securities or its nominee, upon receipt of any payment of principal, premium or interest with respect to a definitive global security representing any of such debt securities, will immediately credit participants' accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of such global security, as shown on the records of the depositary or its nominee. We also expect that payments by participants to owners of beneficial interests in such global security held through such participants will be governed by
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standing instructions and customary practices, as is now the case with securities held for the accounts of customers and registered in "street name."
If we so specify with respect to the debt securities of a series, an owner of a beneficial interest in a global security representing debt securities of such series may, on terms acceptable to us, the trustee and the depositary for such global security, receive individual debt securities of such series in exchange for such beneficial interests. In any such instance, an owner of a beneficial interest in a global security will be entitled to physical delivery of individual debt securities of the series represented by such global security equal in principal amount to such beneficial interest and to have such debt securities registered in its name (if the debt securities are issuable as securities in registered form). Individual debt securities of such series so issued generally will be issued as securities in registered form in minimum denominations, unless otherwise specified by us, of $2,000 and any integral multiples of $1,000 in excess thereof.
Certain Covenants
If debt securities are issued, the indenture, as supplemented for a particular series of debt securities, will contain certain covenants for the benefit of the holders of such series of debt securities, which will be applicable (unless waived or amended) so long as any of the debt securities of such series are outstanding, unless stated otherwise in the prospectus supplement. The specific terms of the covenants, and summaries thereof, will be set forth in the prospectus supplement relating to such series of debt securities.
Subordination
Debt securities of a series and any guarantees, may be subordinated, which we refer to as subordinated debt securities, to senior indebtedness (as defined in the applicable prospectus supplement) to the extent set forth in the prospectus supplement relating thereto. To the extent we conduct operations through subsidiaries, the holders of debt securities (whether or not subordinated debt securities) will be structurally subordinated to the creditors of our subsidiaries, except to the extent such subsidiary is a guarantor of such series of debt securities.
Events of Default
Each of the following will constitute an event of default under the indenture with respect to any series of debt securities:
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- default in payment of the principal amount of the debt securities of that series, when such amount becomes due and payable at maturity, upon
acceleration, required redemption or otherwise;
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- failure to pay interest on the debt securities of that series within 30 days of the due date;
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- failure to make a deposit of any sinking fund payment of the debt securities of that series when and as due;
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- failure to comply for 90 days after notice with any of our other agreements in the debt securities of that series or the indenture or
supplemental indenture related to that series of debt securities; or
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- certain events of bankruptcy, insolvency or reorganization affecting us.
A prospectus supplement may omit, modify or add to the foregoing events of default.
An event of default under one series of debt securities does not necessarily constitute an event of default under any other series of debt securities. A default under the fourth bullet above will not
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constitute an event of default until the trustee or the holders of 33% in principal amount of the outstanding debt securities of such series notify us of the default and we do not cure such default within the time specified after receipt of such notice.
If any event of default (other than an event of default relating to certain events of bankruptcy, insolvency or reorganization) occurs and is continuing with respect to a particular series of debt securities, either the trustee or the holders of not less than 33% in aggregate principal amount of the debt securities of that series then outstanding by written notice to us (and to the trustee if such notice is given by the holders), may declare the principal amount of (or in the case of original issue discount debt securities, the portion thereby specified in the terms thereof), and accrued interest on the debt securities of that series to be immediately due and payable. In the case of certain events of bankruptcy, insolvency or reorganization, the principal amount of, and accrued interest on the debt securities of that series will automatically become and be immediately due and payable without any declaration or other act on the part of the trustee or any holders. Upon a declaration by the trustee or the holders, we will be obligated to pay the principal amount plus accrued and unpaid interest of each affected series of debt securities so declared due and payable.
The holders of a majority in aggregate principal amount of the debt securities of any series then outstanding by notice to the trustee under the indenture may on behalf of the holders of all of such series of debt securities waive any existing default or event of default and its consequences under the applicable indenture except a continuing default or event of default in the payment of interest on, or the principal of, the debt securities of such series.
Subject to the provisions of the indenture relating to the duties of the trustee in case an event of default occurs and is continuing, the trustee is under no obligation to exercise any of its rights or powers under the indenture or debt securities at the request or direction of any of the holders of any series of debt securities, unless such holders have offered to the trustee security or indemnity reasonably satisfactory to the trustee against any costs, expenses or liabilities. Subject to such provisions for the indemnification of the trustee, the holders of at least a majority in aggregate principal amount of the outstanding debt securities of a series have the right to direct the time, method and place of conducting any proceeding for any remedy available to the trustee or exercising any trust or power conferred on the trustee with respect to such series of debt securities. The trustee, however, may refuse to follow any direction that conflicts with law or the indenture or that would subject the trustee to a risk of personal liability for which the trustee has not received reasonably satisfactory indemnification and/or security. Prior to taking any action under the indenture, the trustee is entitled to indemnification satisfactory to it against all losses, liabilities and expenses caused by taking or not taking such action.
Except to enforce the right to receive payment of principal, premium, if any, or interest when due, no holder of debt securities of a series has any right to institute any proceeding with respect to the indenture or debt securities, or for the appointment of a receiver or a trustee, or for any other remedy thereunder, unless:
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- such holder has previously given to the trustee written notice of a continuing event of default with respect to such series of debt securities;
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- the holder or holders of not less than 33% in aggregate principal amount of the outstanding debt securities of that series have made written
request, and such holder or holders have offered indemnity reasonably satisfactory to the trustee against the costs, expenses and liabilities, to the trustee to institute such proceeding as trustee;
and
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- the trustee has failed to institute such proceeding, and has not received from the holders of a majority in aggregate principal amount of the outstanding debt securities of that series a direction inconsistent with such request, within 60 days after such notice, request and offer.
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However, such limitations do not apply to a suit instituted by a holder of a debt security of such series for the enforcement of payment of the principal, premium, if any, or interest on such debt security on or after the applicable due date specified in such debt security.
The indenture provides that if a default with respect to a series of debt securities occurs and is continuing and is known to the trustee, the trustee must send to each holder of such debt securities notice of the default within 90 days after the trustee has gained knowledge of the default. Except in the case of a default in the payment of the principal or premium, if any, or interest with respect to any debt security of a series or in the payment of any sinking fund installment with respect to any debt security of a series, the trustee may withhold notice if and so long as the trustee in good faith determines that withholding notice is in the interests of the holders of such series.
The indenture requires us to furnish to the trustee, within 120 days after the end of each fiscal year, a statement by certain of our officers as to whether or not we, to their knowledge, are in default in the performance or observance of any of the terms, provisions and conditions of the indenture and, if so, specifying all such known defaults. We are also required to deliver to the trustee, within 10 business days after becoming aware of the occurrence thereof, written notice of certain defaults and events of default.
Street name and other indirect holders should consult their banks and brokers for information on their requirements for giving notice or taking other actions upon a default.
Modification and Waiver
Subject to certain exceptions, modifications and amendments of the indenture, any supplemental indenture and any series of debt securities may be made by us and the trustee with the consent of the holders of at least a majority in aggregate principal amount of the outstanding debt securities of any series affected by such modification or amendment.
No such modification or amendment may, without the consent of each holder affected thereby:
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- change the stated maturity of, the principal of, or any installment of principal of or interest on debt securities;
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- reduce the principal amount of debt securities or the rate of interest thereon or any premium payable upon the redemption thereof;
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- reduce the amount of the principal of an original issue discount for debt securities that would be due and payable upon a declaration of
acceleration of the maturity thereof;
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- adversely affect any right of repayment of debt securities at the holder's option;
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- change any place of payment where, or the currency in which, debt securities or any premium or the interest thereon is payable;
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- impair the right to institute suit for the enforcement of any payment on or after the stated maturity of debt securities (or, in the case of
redemption, on or after the redemption date);
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- modify the debt securities of any series to subordinate such debt securities to other indebtedness;
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- reduce the percentage in principal amount of the outstanding debt securities of the series for such outstanding debt security;
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- reduce the consent of holders for debt securities that is required for any supplemental indenture or that is required for any waiver (of compliance with certain provisions of the indenture or certain defaults hereunder and their consequences) provided for in the indenture; or
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- •
- make any change in the amendment provisions which require each holder's consent or in the waiver provision, subject to limited exceptions for the waiver provision.
Without the consent of any holder, we and the trustee may amend the indenture for one or more of the following purposes:
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- to evidence our succession and the assumption by any such successor of our covenants and the debt securities;
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- to add to our covenants for the benefit of the holders of all or any series of debt securities (and if such covenants are to be for the benefit
of less than all series of debt securities, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right or power herein conferred upon us;
- •
- to add any additional events of default for the benefit of the holders of all or any series of debt securities (and if such additional events
of default are to be for the benefit of less than all series of securities, stating that such additional events of default are expressly being included solely for the benefit of such series);
- •
- to add to or change any of the provisions of the indenture to such extent as shall be necessary to permit or facilitate the issuance of new
debt securities, registrable or not registrable as to principal, and with or without interest coupons, or to permit or facilitate the issuance of debt securities in uncertificated form;
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- to change or eliminate any of the provisions of the indenture, provided that any such change or
elimination shall become effective only when there is no debt security outstanding of any series created prior to the execution of such supplemental indenture which is entitled to the benefit of such
provision;
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- to make a change to the debt securities of any series that does not materially adversely affect the rights of any holder of the debt securities
of such series;
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- to establish the form or terms of debt securities of any series as permitted;
- •
- to evidence and provide for the acceptance of appointment under the indenture by a successor trustee with respect to the debt securities of one
or more series or to add to or change any of the provisions of the indenture as necessary to provide for or facilitate the administration of the trusts under the indenture by more than one trustee;
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- to cure any ambiguity, defect or inconsistency in the indenture or in the debt securities of any series;
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- to comply with any requirement of the SEC in order to effect or maintain the qualification of the indenture under the Trust Indenture Act;
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- to add guarantees with respect to, or to secure, the debt securities of any series; or
- •
- to conform the indenture or the debt securities to the description thereof in the related prospectus, offering memorandum or disclosure document.
Mergers and Sales of Assets
The indenture provides that we will not consolidate with, merge with or into or sell, convey, transfer, lease or otherwise dispose in one transaction or a series of related transactions, directly or indirectly, all or substantially all of our properties and assets to, another person, unless (i) the resulting, surviving or transferee person, if not Elanco, is a person organized and existing under the laws of the United States of America or any jurisdiction thereof and expressly assumes by supplemental indenture all of our obligations under the indenture and the debt securities; (ii) immediately after giving effect to
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such transaction, no default or event of default has occurred and is continuing under the indenture; and (iii) we or the successor person has delivered to the trustee the certificates and opinions of counsel required under the indenture. Upon any such consolidation, merger or transfer, the resulting, surviving or transferee person shall succeed to, and may exercise every right and power of, Elanco under the indenture.
Satisfaction and Discharge of the Indenture; Defeasance
Unless otherwise provided for in the prospectus supplement, the indenture will generally cease to be of any further effect with respect to a series of debt securities if (a) we have delivered to the trustee for cancellation all debt securities of such series (with certain limited exceptions) or (b) all debt securities and coupons of such series not theretofore delivered to the trustee for cancellation will have become due and payable, or are by their terms to become due and payable within one year or are to be called for redemption within one year, and we will have deposited with the trustee as trust funds the entire amount sufficient to pay at maturity or upon redemption all such debt securities and coupons (and if, in either case, we will also pay or cause to be paid all other sums payable under the indenture by us).
In addition, we will have a "legal defeasance option" (pursuant to which we may terminate, with respect to the debt securities of a particular series, all of our obligations under such debt securities and the indenture with respect to such debt securities) and a "covenant defeasance option" (pursuant to which we may terminate, with respect to the debt securities of a particular series, our obligations with respect to such debt securities under certain specified covenants contained in the indenture). If we exercise our legal defeasance option with respect to a series of debt securities, payment of such debt securities may not be accelerated because of an event of default. If we exercise our covenant defeasance option with respect to a series of debt securities, payment of such debt securities may not be accelerated because of an event of default related to the specified covenants.
The applicable prospectus supplement will describe the procedures we must follow in order to exercise our defeasance options.
Regarding the Trustee
The indenture provides that, except during the continuance of an event of default, the trustee will perform only such duties as are specifically set forth in the indenture. During the existence of an event of default, the trustee may exercise such rights and powers vested in it under the indenture and use the same degree of care and skill in its exercise as a prudent person would exercise under the circumstances in the conduct of such person's own affairs.
The indenture and provisions of the Trust Indenture Act contain limitations on the rights of the trustee, should it become one of our creditors, to obtain payment of claims in certain cases or to realize on certain property received by it in respect of any such claim as security or otherwise. The trustee will be permitted to engage in other transactions with us or any of our affiliates; provided, however, that if it acquires any conflicting interest (as defined in the indenture or in the Trust Indenture Act), it must eliminate such conflict, apply to the SEC for permission to continue, or resign.
Governing Law
The indenture and the debt securities will be governed by, and construed in accordance with, the laws of the State of New York.
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DESCRIPTION OF DEPOSITARY SHARES
General
We may, at our option, elect to offer fractional shares rather than full shares of the preferred stock of a series. In the event that we determine to do so, we will issue receipts for depositary shares, each of which will represent a fraction (to be set forth in the prospectus supplement relating to a particular series of preferred stock) of a share of a particular series of preferred stock as more fully described below.
The shares of any series of preferred stock represented by depositary shares will be deposited under one or more deposit agreements among us, a depositary to be named in the applicable prospectus supplement, and the holders from time to time of depositary receipts issued thereunder. Subject to the terms of the applicable deposit agreement, each holder of a depositary share will be entitled, in proportion to the applicable fraction of a share of preferred stock represented by the depositary share, to all the rights and preferences of the preferred stock represented thereby (including, as applicable, dividend, voting, redemption, subscription and liquidation rights).
The depositary shares will be evidenced by depositary receipts issued pursuant to the deposit agreement. Depositary receipts will be distributed to those persons purchasing the fractional shares of the related series of preferred stock.
The following description sets forth certain general terms and provisions of the depositary shares to which any prospectus supplement may relate. The particular terms of the depositary shares to which any prospectus supplement may relate and the extent, if any, to which such general provisions may apply to the depositary shares so offered will be described in the applicable prospectus supplement. To the extent that any particular terms of the depositary shares or the deposit agreement described in a prospectus supplement differ from any of the terms described below, then the terms described below will be deemed to have been superseded by that prospectus supplement relating to such deposited shares. The forms of deposit agreement and depositary receipt will be filed as exhibits to the documents incorporated or deemed to be incorporated by reference into this prospectus.
The following summary of certain provisions of the depositary shares and deposit agreement does not purport to be complete and is subject to, and is qualified in its entirety by express reference to, all the provisions of the deposit agreement and the applicable prospectus supplement, including the definitions.
Immediately following our issuance of shares of a series of preferred stock that will be offered as fractional shares, we will deposit the shares with the depositary, which will then issue and deliver the depositary receipts to the purchasers thereof. Depositary receipts will only be issued evidencing whole depositary shares. A depositary receipt may evidence any number of whole depositary shares.
Pending the preparation of definitive depositary receipts, the depositary may, upon our written order, issue temporary depositary receipts substantially identical to (and entitling the holders thereof to all the rights pertaining to) the definitive depositary receipts but not in definitive form. Definitive depositary receipts will be prepared thereafter without unreasonable delay, and such temporary depositary receipts will be exchangeable for definitive depositary receipts at our expense.
Dividends and Other Distributions
The depositary will distribute all cash dividends or other cash distributions received in respect of the related series of preferred stock to the record holders of depositary shares relating to the series of preferred stock in proportion to the number of the depositary shares owned by the holders.
In the event of a distribution other than in cash, the depositary will distribute property received by it to the record holders of depositary shares entitled thereto in proportion to the number of depositary
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shares owned by the holders, unless the depositary determines that the distribution cannot be made proportionately among the holders or that it is not feasible to make the distributions, in which case the depositary may, with our approval, adopt any method as it deems equitable and practicable for the purpose of effecting the distribution, including the sale (at public or private sale) of the securities or property thus received, or any part thereof, at the place or places and upon those terms as it may deem proper.
The amount distributed in any of the foregoing cases will be reduced by any amounts required to be withheld by us or the depositary on account of taxes or other governmental charges.
Redemption of Depositary Shares
If any series of the preferred stock underlying the depositary shares is subject to redemption, the depositary shares will be redeemed from the proceeds received by the depositary resulting from any redemption, in whole or in part, of the series of the preferred stock held by the depositary. The redemption price per depositary share will be equal to the applicable fraction of the redemption price per share payable with respect to the series of the preferred stock. If we redeem shares of a series of preferred stock held by the depositary, the depositary will redeem as of the same redemption date the number of depositary shares representing the shares of preferred stock so redeemed. If less than all the depositary shares are to be redeemed, the depositary shares to be redeemed will be selected by lot or substantially equivalent method determined by the depositary.
After the date fixed for redemption, the depositary shares so called for redemption will no longer be deemed to be outstanding and all rights of the holders of the depositary shares will cease, except the right to receive the monies payable upon redemption and any money or other property to which the holders of the depositary shares were entitled upon such redemption, upon surrender to the depositary of the depositary receipts evidencing the depositary shares. Any funds deposited by us with the depositary for any depositary shares that the holders thereof fail to redeem will be returned to us after a period of two years from the date the funds are so deposited.
Voting the Underlying Preferred Stock
Upon receipt of notice of any meeting at which the holders of any series of the preferred stock are entitled to vote, the depositary will mail the information contained in the notice of meeting to the record holders of the depositary shares relating to the series of preferred stock. Each record holder of the depositary shares on the record date (which will be the same date as the record date for the related series of preferred stock) will be entitled to instruct the depositary as to the exercise of the voting rights pertaining to the number of shares of the series of preferred stock represented by that holder's depositary shares. The depositary will endeavor, insofar as practicable, to vote or cause to be voted the number of shares of preferred stock represented by the depositary shares in accordance with the instructions, provided the depositary receives the instructions sufficiently in advance of the meeting to enable it to so vote or cause to be voted the shares of preferred stock, and we will agree to take all reasonable action that may be deemed necessary by the depositary in order to enable the depositary to do so. The depositary will abstain from voting shares of the preferred stock to the extent it does not receive specific instructions from the holders of depositary shares representing the preferred stock.
Withdrawal of Stock
Upon surrender of the depositary receipts at the corporate trust office of the depositary and upon payment of the taxes, charges and fees provided for in the deposit agreement and subject to the terms thereof, the holder of the depositary shares evidenced thereby will be entitled to delivery at such office, to or upon his or her order, of the number of whole shares of the related series of preferred stock and any money or other property, if any, represented by the depositary shares. Holders of depositary shares
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will be entitled to receive whole shares of the related series of preferred stock, but holders of the whole shares of preferred stock will not thereafter be entitled to deposit the shares of preferred stock with the depositary or to receive depositary shares therefor. If the depositary receipts delivered by the holder evidence a number of depositary shares in excess of the number of depositary shares representing the number of whole shares of the related series of preferred stock to be withdrawn, the depositary will deliver to the holder or upon his or her order at the same time a new depositary receipt evidencing the excess number of depositary shares.
Amendment and Termination of a Deposit Agreement
The form of depositary receipt evidencing the depositary shares of any series and any provision of the applicable deposit agreement may at any time and from time to time be amended by agreement between us and the depositary. However, any amendment that materially adversely alters the rights of the holders of depositary shares of any series will not be effective unless the amendment has been approved by the holders of at least a majority of the depositary shares of the series then outstanding. Every holder of a depositary receipt at the time the amendment becomes effective will be deemed, by continuing to hold the depositary receipt, to be bound by the deposit agreement as so amended. Notwithstanding the foregoing, in no event may any amendment impair the right of any holder of any depositary shares, upon surrender of the depositary receipts evidencing the depositary shares and subject to any conditions specified in the deposit agreement, to receive shares of the related series of preferred stock and any money or other property represented thereby, except in order to comply with mandatory provisions of applicable law. The deposit agreement may be terminated by us at any time upon not less than 60 days prior written notice to the depositary, in which case, on a date that is not later than 30 days after the date of the notice, the depositary shall deliver or make available for delivery to holders of depositary shares, upon surrender of the depositary receipts evidencing the depositary shares, the number of whole or fractional shares of the related series of preferred stock as are represented by the depositary shares. The deposit agreement shall automatically terminate after all outstanding depositary shares have been redeemed or there has been a final distribution in respect of the related series of preferred stock in connection with any liquidation, dissolution or winding up of us and the distribution has been distributed to the holders of depositary shares.
Charges of Depositary
We will pay all transfer and other taxes and the governmental charges arising solely from the existence of the depositary arrangements. We will pay the charges of the depositary, including charges in connection with the initial deposit of the related series of preferred stock and the initial issuance of the depositary shares and all withdrawals of shares of the related series of preferred stock, except that holders of depositary shares will pay transfer and other taxes and governmental charges and any other charges as are expressly provided in the deposit agreement to be for their accounts.
Resignation and Removal of Depositary
The depositary may resign at any time by delivering to us written notice of its election to do so, and we may at any time remove the depositary. Any resignation or removal will take effect upon the appointment of a successor depositary, which successor depositary must be appointed within 60 days after delivery of the notice of resignation or removal and must be a bank or trust company having its principal office in the United States and having a combined capital and surplus of at least $50,000,000.
Miscellaneous
The depositary will forward to the holders of depositary shares all reports and communications from us that are delivered to the depositary and which we are required to furnish to the holders of the related preferred stock.
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The depositary's corporate trust office will be identified in the applicable prospectus supplement. Unless otherwise set forth in the applicable prospectus supplement, the depositary will act as transfer agent and registrar for depositary receipts and if shares of a series of preferred stock are redeemable, the depositary will also act as redemption agent for the corresponding depositary receipts.
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The following description of the terms of the warrants sets forth certain general terms and provisions of the warrants to which any prospectus supplement may relate. We may issue warrants for the purchase of common stock, preferred stock, debt securities or depositary shares. Warrants may be issued independently or together with common stock, preferred stock, debt securities or depositary shares offered by any prospectus supplement and may be attached to or separate from any such offered securities. Each series of warrants will be issued under a separate warrant agreement to be entered into between us and a bank or trust company, as warrant agent. The warrant agent will act solely as our agent in connection with the warrants and will not assume any obligation or relationship of agency or trust for or with any holders or beneficial owners of warrants. The following summary of certain provisions of the warrants does not purport to be complete and is subject to, and qualified in its entirety by reference to, the provisions of the warrant agreement that will be filed with the SEC in connection with the offering of such warrants.
Debt Warrants
The prospectus supplement relating to a particular issue of debt warrants will describe the terms of such debt warrants, including the following:
- •
- the title of such debt warrants;
- •
- the offering price for such debt warrants, if any;
- •
- the aggregate number of such debt warrants;
- •
- the designation and terms of the debt securities purchasable upon exercise of such debt warrants;
- •
- if applicable, the designation and terms of the debt securities with which such debt warrants are issued and the number of such debt warrants
issued with each such debt security;
- •
- if applicable, the date from and after which such debt warrants and any debt securities issued therewith will be separately transferable;
- •
- the principal amount of debt securities purchasable upon exercise of a debt warrant and the price at which such principal amount of debt
securities may be purchased upon exercise (which price may be payable in cash, securities or other property);
- •
- the date on which the right to exercise such debt warrants shall commence and the date on which such right shall expire;
- •
- if applicable, the minimum or maximum amount of such debt warrants that may be exercised at any one time;
- •
- whether the debt warrants represented by the debt warrant certificates or debt securities that may be issued upon exercise of the debt warrants
will be issued in registered or bearer form;
- •
- information with respect to book-entry procedures, if any;
- •
- the currency or currency units in which the offering price, if any, and the exercise price are payable;
- •
- if applicable, a discussion of material United States federal income tax considerations;
- •
- the antidilution or adjustment provisions of such debt warrants, if any;
- •
- the redemption or call provisions, if any, applicable to such debt warrants; and
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- •
- any additional terms of such debt warrants, including terms, procedures, and limitations relating to the exchange and exercise of such debt warrants.
Stock Warrants
The prospectus supplement relating to any particular issue of common stock warrants, preferred stock warrants or depositary share warrants will describe the terms of such warrants, including the following:
- •
- the title of such warrants;
- •
- the offering price for such warrants, if any;
- •
- the aggregate number of such warrants;
- •
- the designation and terms of the offered securities purchasable upon exercise of such warrants;
- •
- if applicable, the designation and terms of the offered securities with which such warrants are issued and the number of such warrants issued
with each such offered security;
- •
- if applicable, the date from and after which such warrants and any offered securities issued therewith will be separately transferable;
- •
- the number of shares of common stock, preferred stock or depositary shares purchasable upon exercise of a warrant and the price at which such
shares may be purchased upon exercise;
- •
- the date on which the right to exercise such warrants shall commence and the date on which such right shall expire;
- •
- if applicable, the minimum or maximum amount of such warrants that may be exercised at any one time;
- •
- the currency or currency units in which the offering price, if any, and the exercise price are payable;
- •
- if applicable, a discussion of material United States federal income tax considerations;
- •
- the antidilution provisions of such warrants, if any;
- •
- the redemption or call provisions, if any, applicable to such warrants; and
- •
- any additional terms of such warrants, including terms, procedures and limitations relating to the exchange and exercise of such warrants.
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We may issue rights to purchase our common stock. The rights may or may not be transferable by the persons purchasing or receiving the rights. In connection with any rights offering, we may enter into a standby underwriting or other arrangement with one or more underwriters or other persons pursuant to which such underwriters or other persons would purchase any offered securities remaining unsubscribed for after such rights offering. Each series of rights will be issued under a separate rights agent agreement to be entered into between us and one or more banks, trust companies or other financial institutions, as rights agent, which we will name in the applicable prospectus supplement. The rights agent will act solely as our agent in connection with the rights and will not assume any obligation or relationship of agency or trust for or with any holders of rights certificates or beneficial owners of rights.
The prospectus supplement relating to any rights that we offer will include specific terms relating to the offering, including, among other matters:
- •
- the date of determining the security holders entitled to the rights distribution;
- •
- the aggregate number of rights issued and the aggregate number of shares of common stock purchasable upon exercise of the rights;
- •
- the exercise price;
- •
- the conditions to completion of the rights offering;
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- the date on which the right to exercise the rights will commence and the date on which the rights will expire; and
- •
- any applicable federal income tax considerations.
Each right would entitle the holder of the rights to purchase for cash the principal amount of shares of common stock at the exercise price set forth in the applicable prospectus supplement. Rights may be exercised at any time up to the close of business on the expiration date for the rights provided in the applicable prospectus supplement. After the close of business on the expiration date, all unexercised rights will become void.
If less than all of the rights issued in any rights offering are exercised, we may offer any unsubscribed securities directly to persons other than our security holders, to or through agents, underwriters or dealers or through a combination of such methods, including pursuant to standby arrangements, as described in the applicable prospectus supplement.
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DESCRIPTION OF THE PURCHASE CONTRACTS
We may issue, from time to time, purchase contracts, including contracts obligating holders to purchase from us and us to sell to the holders, a specified principal amount of debt securities, shares of common stock or preferred stock, depositary shares, government securities, or other securities that we may sell under this prospectus at a future date or dates. The consideration payable upon settlement of the purchase contracts may be fixed at the time the purchase contracts are issued or may be determined by a specific reference to a formula set forth in the purchase contracts. The purchase contracts may be issued separately or as part of units consisting of a purchase contract and other securities or obligations issued by us or third parties, including United States treasury securities, securing the holders' obligations to purchase the relevant securities under the purchase contracts. The purchase contracts may require us to make periodic payments to the holders of the purchase contracts or units or vice versa, and the payments may be unsecured or prefunded on some basis. The purchase contracts may require holders to secure their obligations under the purchase contracts and, in certain circumstances, we may deliver a newly issued prepaid purchase contract, which is referred to as a "prepaid security," upon release to a holder of any collateral securing such holder's obligations under the original contract.
The prospectus supplement related to any particular purchase contracts and, if applicable, prepaid security, will describe, among other things, the material terms of the purchase contracts and of the securities being sold pursuant to such purchase contracts, and, if applicable, the prepaid securities and the documents pursuant to which such prepaid securities will be issued, a discussion, if appropriate, of any special United States federal income tax considerations applicable to the purchase contracts and any material provisions governing the purchase contracts that differ from those described above. The description in the prospectus supplement will not necessarily be complete and will be qualified in its entirety by reference to the purchase contracts, and, if applicable, collateral arrangements and depositary arrangements, relating to the purchase contracts. Alternatively, purchase contracts may require holders to satisfy their obligations thereunder when the purchase contracts are issued.
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We may, from time to time, issue units comprised of one or more of certain other securities that may be offered under this prospectus, in any combination. Each unit may also include debt obligations of third parties, such as U.S. Treasury securities. Each unit will be issued so that the holder of the unit is also the holder of each security included in the unit. Thus, the holder of a unit will have the rights and obligations of a holder of each included security. The unit agreement under which a unit is issued may provide that the securities included in the unit may not be held or transferred separately at any time, or at any time before a specified date.
Any prospectus supplement related to any particular units will describe, among other things:
- •
- the material terms of the units and of the securities comprising the units, including whether and under what circumstances those securities may
be held or transferred separately;
- •
- if applicable, the prepaid securities and the documents pursuant to which such prepaid securities will be issued;
- •
- any material provisions relating to the issuance, payment, settlement, transfer or exchange of the units or of the securities comprising the
units;
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- if appropriate, any special United States federal income tax considerations applicable to the units; and
- •
- any material provisions of the governing unit agreement that differ from those described above.
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We may offer and sell the securities in any one or more of the following ways:
- •
- to or through underwriters, brokers or dealers;
- •
- directly to one or more other purchasers;
- •
- through a block trade in which the broker or dealer engaged to handle the block trade will attempt to sell the securities as agent, but may
position and resell a portion of the block as principal to facilitate the transaction;
- •
- through agents on a best-efforts basis; or
- •
- otherwise through a combination of any of the above methods of sale.
In addition, we may enter into option, share lending or other types of transactions that require us to deliver securities to an underwriter, broker or dealer, who will then resell or transfer the securities under this prospectus. We may also enter into hedging transactions with respect to our securities. For example, we may:
- •
- enter into transactions involving short sales of the securities by underwriters, brokers or dealers;
- •
- sell securities short and deliver the securities to close out short positions;
- •
- enter into option or other types of transactions that require us to deliver securities to an underwriter, broker or dealer, who will then
resell or transfer the securities under this prospectus; or
- •
- loan or pledge the securities to an underwriter, broker or dealer, who may sell the loaned securities or, in the event of default, sell the pledged securities.
We may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus supplement indicates, in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third party may use securities pledged by us or borrowed from us or others to settle those sales or to close out any related open borrowings of securities, and may use securities received from us in settlement of those derivatives to close out any related open borrowings of securities. The third party in such sale transactions will be an underwriter and, if not identified in this prospectus, will be identified in the applicable prospectus supplement (or a post-effective amendment). In addition, we may otherwise loan or pledge securities to a financial institution or other third party that in turn may sell the securities short using this prospectus. Such financial institution or other third party may transfer its economic short position to investors in our securities or in connection with a concurrent offering of other securities.
Each time we sell securities, we will provide a prospectus supplement that will name any underwriter, dealer or agent involved in the offer and sale of the securities. The prospectus supplement will also set forth the terms of the offering, including:
- •
- the purchase price of the securities and the proceeds we will receive from the sale of the securities;
- •
- any underwriting discounts and other items constituting underwriters' compensation;
- •
- any public offering or purchase price and any discounts or commissions allowed or re-allowed or paid to dealers;
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- any commissions allowed or paid to agents;
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- •
- any other offering expenses;
- •
- any securities exchanges on which the securities may be listed;
- •
- the method of distribution of the securities;
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- the terms of any agreement, arrangement or understanding entered into with the underwriters, brokers or dealers; and
- •
- any other information we think is important.
If underwriters or dealers are used in the sale, the securities will be acquired by the underwriters or dealers for their own account. The securities may be sold from time to time by us in one or more transactions:
- •
- at a fixed price or prices that may be changed;
- •
- at market prices prevailing at the time of sale;
- •
- at prices related to such prevailing market prices;
- •
- at varying prices determined at the time of sale; or
- •
- at negotiated prices.
Such sales may be effected:
- •
- in transactions on any national securities exchange or quotation service on which the securities may be listed or quoted at the time of sale;
- •
- in transactions in the over-the-counter market;
- •
- in block transactions in which the broker or dealer so engaged will attempt to sell the securities as agent but may position and resell a
portion of the block as principal to facilitate the transaction, or in crosses, in which the same broker acts as an agent on both sides of the trade;
- •
- through the writing of options; or
- •
- through other types of transactions.
The securities may be offered to the public either through underwriting syndicates represented by one or more managing underwriters or directly by one or more of such firms. Unless otherwise set forth in the prospectus supplement, the obligations of underwriters or dealers to purchase the securities offered will be subject to certain conditions precedent and the underwriters or dealers will be obligated to purchase all the offered securities if any are purchased. Any public offering price and any discount or concession allowed or reallowed or paid by underwriters or dealers to other dealers may be changed from time to time.
Any securities covered by this prospectus that qualify for sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144 rather than pursuant to this prospectus. Any securities offered under this prospectus will be listed on the New York Stock Exchange (or other such exchange or automated quotation system on which the common stock is listed), subject to official notice of issuance.
The securities may be sold directly by us or through 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 such agent will be set forth in, the prospectus supplement. Unless otherwise indicated in the prospectus supplement, any such agent will be acting on a best efforts basis for the period of its appointment.
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Offers to purchase the securities offered by this prospectus may be solicited, and sales of the 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 with respect to any resale of the securities. The terms of any offer made in this manner will be included in the prospectus supplement relating to the offer.
If indicated in the applicable prospectus supplement, underwriters, dealers or agents will be authorized to solicit offers by certain institutional investors to purchase securities from us pursuant to contracts providing for payment and delivery at a future date. Institutional investors with which these contracts may be made include, among others:
- •
- commercial and savings banks;
- •
- insurance companies;
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- pension funds;
- •
- investment companies; and
- •
- educational and charitable institutions.
In all cases, these purchasers must be approved by us. Unless otherwise set forth in the applicable prospectus supplement, the obligations of any purchaser under any of these contracts will not be subject to any conditions except that (a) the purchase of the securities must not at the time of delivery be prohibited under the laws of any jurisdiction to which that purchaser is subject, and (b) if the securities are also being sold to underwriters, we must have sold to these underwriters the securities not subject to delayed delivery. Underwriters and other agents will not have any responsibility in respect of the validity or performance of these contracts.
Some of the underwriters, dealers or agents used by us in any offering of securities under this prospectus may be customers of, engage in transactions with, and perform services for us or affiliates of ours in the ordinary course of business. Underwriters, dealers, agents and other persons may be entitled under agreements which may be entered into with us to indemnification against and contribution toward certain civil liabilities, including liabilities under the Securities Act, and to be reimbursed by us for certain expenses.
Subject to any restrictions relating to debt securities in bearer form, any securities initially sold outside the United States may be resold in the United States through underwriters, dealers or otherwise.
Any underwriters to which offered securities are sold by us for public offering and sale may make a market in such securities, but those underwriters will not be obligated to do so and may discontinue any market making at any time.
The anticipated date of delivery of the securities offered by this prospectus will be described in the applicable prospectus supplement relating to the offering.
To comply with the securities laws of some states, if applicable, the securities may be sold in these jurisdictions only through registered or licensed brokers or dealers. In addition, in some states the securities may not be sold unless they have been registered or qualified for sale or an exemption from registration or qualification requirements is available and is complied with.
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Unless otherwise indicated in the applicable prospectus supplement, certain legal matters will be passed upon for us by Paul, Weiss, Rifkind, Wharton & Garrison LLP, New York, New York and Barnes & Thornburg LLP. If legal matters in connection with offerings made pursuant to this prospectus are passed upon by counsel for underwriters, dealers or agents, if any, such counsel will be named in the prospectus supplement relating to such offering.
Elanco
The consolidated and combined financial statements of Elanco Animal Health Incorporated appearing in Elanco Animal Health Incorporated's Annual Report (Form 10-K) for the year ended December 31, 2018, have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in their report thereon, included therein, and incorporated herein by reference. Such consolidated and combined financial statements are incorporated herein by reference in reliance upon such report given on the authority of such firm as experts in accounting and auditing.
Bayer Animal Health Business
The financial statements of the Animal Health Business of Bayer Aktiengesellschaft as of and for the years ended December 31, 2016, 2017 and 2018, incorporated in this prospectus by reference have been audited by Deloitte GmbH Wirtschaftsprüfungsgesellschaft, independent auditors, as stated in their report incorporated herein by reference, and are included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.
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Elanco Animal Health Incorporated
Common Stock
Preferred Stock
Debt Securities
Depositary Shares
Warrants
Rights
Purchase Contracts
Units
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the costs and expenses payable by the registrant in connection with the sale of the securities being registered hereby.
| |
Amount to be Paid |
|||
|---|---|---|---|---|
SEC registration fee |
$ | * | ||
NYSE supplemental listing fees |
** | |||
Printing and duplicating expenses |
** | |||
Legal fees and expenses |
** | |||
Accounting fees and expenses |
** | |||
Transfer agent and trustee fees and expenses |
** | |||
Miscellaneous expenses |
** | |||
| | | | | |
Total |
$ | ** | ||
| | | | | |
| | | | | |
| | | | | |
- *
- In
accordance with Rules 456(b) and 457(r) of the Securities Act, we are deferring payment of the SEC registration fee for the securities offered by this
registration statement.
- **
- Expenses are presently not known and cannot be estimated.
Item 15. Indemnification of Directors and Officers
Chapter 37 of the Indiana Business Corporation Law ("IBCL") authorizes every Indiana corporation to indemnify its officers and directors under certain circumstances against liability incurred in connection with any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative and whether formal or informal, to which the officers or directors are made a party by reason of their relationship to the corporation. Officers and directors may be indemnified where they have acted in good faith; in the case of official action, the individual reasonably believed that the conduct was in the corporation's best interests and in all other cases, the individual reasonably believed that the conduct was not against the best interests of the corporation; and in the case of criminal proceedings, the individual either had reasonable cause to believe his or her conduct was lawful or no reasonable cause to believe his or her conduct was unlawful. Chapter 37 also requires every Indiana corporation to indemnify any of its officers or directors (unless limited by the articles of incorporation of the corporation) who were wholly successful, on the merits or otherwise, in the defense of any such proceeding against reasonable expenses incurred in connection with the proceeding. A corporation may also, under certain circumstances, pay for or reimburse the reasonable expenses incurred by an officer or director who is a party to a proceeding in advance of final disposition of the proceeding. Chapter 37 states that the indemnification provided for therein is not exclusive of any other rights to which a person may be entitled under the articles of incorporation, bylaws or resolutions of the board of directors or shareholders.
Elanco's amended and restated articles of incorporation and amended and restated bylaws provide for indemnification, to the fullest extent permitted by the IBCL, of Elanco's directors, officers and employees against liability and reasonable expenses that may be incurred by them, arising out of any threatened, pending or completed investigation, claim, suit or proceeding, whether civil, administrative, investigative or criminal, in which they may become involved by reason of being or having been a director, officer or employee. To be entitled to indemnification, (a) those persons must have been
II-1
wholly successful in the claim or action, or (b) the board of directors, independent legal counsel or the shareholders must have determined that such persons acted in good faith in what they reasonably believed to be in Elanco's best interest, or in the case of conduct not in the individual's official capacity with Elanco, did not act in opposition to Elanco's best interest. In addition, in any criminal action, such persons must have had no reasonable cause to believe that their conduct was unlawful. Elanco's amended and restated bylaws provide for mandatory advancement of expenses to such persons provided certain conditions are met, including provision of a written undertaking to repay such advancements, should it be determined that the person is not entitled to indemnification.
The IBCL permits Elanco to purchase insurance on behalf of its directors, officers, employees and agents against liabilities arising out of their positions with us, whether or not such liabilities would be within the above indemnification provisions. Pursuant to this authority, Elanco will maintain such insurance for its directors, officers and employees and those of Elanco's subsidiaries, subject to certain exclusions and deductible and maximum amounts, against loss from claims arising in connection with their acting in their respective capacities, including claims under the Securities Act.
II-2
A list of exhibits filed with this registration statement is contained in the exhibits index, which is incorporated by reference.
II-3
| Exhibit Number |
Description of Documents | |
|---|---|---|
| 23.4 | Consent of Paul, Weiss, Rifkind, Wharton & Garrison LLP (contained in Exhibit 5.2). | |
| 24.1 | Power of Attorney. | |
| 25.1 | Form T-1 Statement of Eligibility of Deutsche Bank Trust Company Americas to act as trustee under the Indenture. |
- *
- To be filed, if necessary, by a post-effective amendment to the registration statement or as an exhibit to a document incorporated by reference herein.
- (a)
- The
undersigned registrant hereby undertakes:
- (1)
- To
file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
- (i)
- To
include any prospectus required by Section 10(a)(3) of the Securities Act;
- (ii)
- To
reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and
- (iii)
- To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;
- (2)
- That,
for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
- (3)
- To
remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
- (4)
- That,
for the purpose of determining liability under the Securities Act to any purchaser:
- (i)
- Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and
provided, however, that paragraphs (i), (ii) and (iii) above do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the SEC by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of that are incorporated by reference into the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.
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- (ii)
- Each
prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B
relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by Section 10(a) of the Securities Act shall be
deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of
securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be
deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or
made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of
contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any
such document immediately prior to such effective date.
- (5)
- That, for the purpose of determining liability of the registrant under the Securities Act to any purchaser in the initial distribution of the securities:
- (i)
- Any
preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
- (ii)
- Any
free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
- (iii)
- The
portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities
provided by or on behalf of the undersigned registrant; and
- (iv)
- Any
other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
- (b)
- The
undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the registrant's annual report
pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the
Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering thereof.
- (c)
- Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the
II-5
registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
II-6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Elanco Animal Health Incorporated certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Greenfield, State of Indiana on January 21, 2020.
| ELANCO ANIMAL HEALTH INCORPORATED | ||||||
By: |
/s/ Jeffrey N. Simmons |
|||||
| Name: | Jeffrey N. Simmons | |||||
| Title: | President and Chief Executive Officer | |||||
KNOW ALL PERSONS BY THESE PRESENTS, that each individual whose signature appears below hereby constitutes and appoints each of Jeffrey N. Simmons and Michael-Bryant Hicks, acting singly, his or her true and lawful agent, proxy and attorney-in-fact, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to (i) act on, sign and file with the Securities and Exchange Commission any and all amendments (including post-effective amendments) to this registration statement together with all schedules and exhibits thereto and any subsequent registration statement filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended, together with all schedules and exhibits thereto, (ii) act on, sign and file such certificates, instruments, agreements and other documents as may be necessary or appropriate in connection therewith, (iii) act on and file any supplement to any prospectus included in this registration statement or any such amendment or any subsequent registration statement filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended, and (iv) take any and all actions which may be necessary or appropriate in connection therewith, granting unto such agent, proxy and attorney-in-fact full power and authority to do and perform each and every act and thing necessary or appropriate to be done, as fully for all intents and purposes as he might or could do in person, hereby approving, ratifying and confirming all that such agents, proxies and attorneys-in-fact or any of their substitutes may lawfully do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below by the following persons in the capacities indicated on January 21, 2020.
| /s/ Jeffrey N. Simmons Jeffrey N. Simmons |
President and Chief Executive Officer; Director (Principal Executive Officer) | |
/s/ Todd S. Young Todd S. Young |
Executive Vice President, Chief Financial Officer (Principal Financial Officer) |
|
/s/ James M. Meer James M. Meer |
Chief Accounting Officer (Principal Accounting Officer) |
|
/s/ R. David Hoover R. David Hoover |
Chairman of the Board |
| /s/ Kapila Kapur Anand Kapila Kapur Anand |
Director | |
/s/ John P. Bilbrey John P. Bilbrey |
Director |
|
/s/ Art A. Garcia Art A. Garcia |
Director |
|
/s/ Michael J. Harrington Michael J. Harrington |
Director |
|
/s/ Deborah T. Kochevar Deborah T. Kochevar |
Director |
|
/s/ Lawrence E. Kurzius Lawrence E. Kurzius |
Director |
|
/s/ Kirk McDonald Kirk McDonald |
Director |
|
/s/ Denise Scots-Knight Denise Scots-Knight |
Director |
Annex 27
Liquidation of Consideration Shares
Section 1. Lock-Up. From the Closing Date until the date which is three (3) months after the Closing Date, Seller Parent shall not, and shall cause its Subsidiaries not to, directly or indirectly, transfer Beneficial Ownership of, offer, sell, contract to sell, pledge, grant any option to purchase, make any short sale or otherwise dispose of or distribute (“Transfer”) any of the Consideration Shares to any Person (other than Seller Parent or any of its Subsidiaries). From the date which is three (3) months following the Closing Date until the date which is six (6) months following the Closing Date, Seller Parent shall not, and shall cause its Subsidiaries not to, Transfer to any Person (other than Seller Parent or any of its Subsidiaries) more than fifty percent (50%) of the Consideration Shares held by Seller Parent and its Subsidiaries immediately following the Closing. From the date which is six (6) months following the Closing Date until the date which is nine (9) months following the Closing Date, Seller Parent shall not, and shall cause its Subsidiaries not to, Transfer to any Person (other than Seller Parent or any of its Subsidiaries) more than fifty percent (50%) of the Consideration Shares held by Seller Parent and its Subsidiaries immediately following the Closing or, in the event of a Transfer of all Consideration Shares then held by Seller Parent and its Subsidiaries, more than seventy-five percent (75%) of the Consideration Shares held by Seller Parent and its Subsidiaries immediately following the Closing. From the date which is nine (9) months following the Closing Date until the date which is twelve (12) months following the Closing Date, Seller Parent shall not, and shall cause its Subsidiaries not to, Transfer to any Person (other than Seller Parent or any of its Subsidiaries) more than fifty percent (50%) of the Consideration Shares held by Seller Parent and its Subsidiaries immediately following the Closing or, in the event of a Transfer of all Consideration Shares then held by Seller Parent and its Subsidiaries, more than seventy-five (75%) of the Consideration Shares held by Seller Parent and its Subsidiaries immediately following the Closing. Notwithstanding the foregoing restrictions, Seller Parent and its Subsidiaries may Transfer any Consideration Shares to any Person (other than a Prohibited Transferee) which executes and delivers a Joinder Agreement in connection with such Transfer at any time after Closing. Upon execution and delivery of a Joinder Agreement by such Person, such Person shall be deemed a “Holder” (as defined below) and shall be subject to the terms of, and entitled to the benefits of, this Annex 27, and such Person shall be a third party beneficiary hereof. Except as otherwise permitted by this Agreement or with the prior written consent of Purchaser, Seller Parent shall not, and shall cause its Subsidiaries not to, Transfer any Consideration Shares other than (i) in transactions exempt from registration under the Securities Act or (ii) pursuant to the Registration Statement. Any Transfer or attempted Transfer of any Consideration Shares in violation of this Annex 27 shall be null and void ab initio, and Purchaser may, and may instruct its transfer agent and other third parties not to, record or recognize such Transfer on the share register of Purchaser.
Section 2. Shelf Registration. Purchaser shall use its reasonable best efforts to file the Shelf Registration Statement with the SEC within sixty (60) days after the Closing Date.
Section 3. Suspension Periods. Upon written notice to Seller Parent, Purchaser shall be entitled to delay the filing or initial effectiveness of, or suspend, for a period of time, the use of any Registration Statement (including the Shelf Registration Statement) or prospectus relating to such Registration Statement: (a) with respect to any underwritten offering, if Purchaser is subject to any of its customary suspension or blackout periods, for all or part of such period; (b) upon issuance by the SEC of a stop order suspending the effectiveness of such Registration Statement with respect to Registrable Securities or the initiation of proceedings with respect to such Registration Statement under Section 8(d) or 8(e) of the Securities Act; (in each case, a “Suspension Period”); or (c) following the one (1) year anniversary of the Closing Date, if the filing, initial effectiveness or continued use of such Registration Statement at any time would require Purchaser to make a public disclosure of material non-public information, which disclosure in the good faith judgment of Purchaser, after consultation with counsel: (i) would be required to be made in any registration statement so that such registration statement would not be materially misleading; (ii) would not be required to be made at such time but for the filing, effectiveness or continued use of such registration statement; and (iii) would reasonably be expected to adversely affect any proposal or plan of Purchaser to effect a merger, acquisition, disposition, financing, reorganization, recapitalization or similar transaction, in each case that is material to Purchaser; provided that (A) the duration of all Suspension Periods referred to in clauses (a) and (c) above may not exceed ninety (90) days in the aggregate in any 12-month period and (B) if applicable, Purchaser shall use its reasonable best efforts to amend the Registration Statement and/or prospectus to correct such untrue statement or omission as soon as reasonably practicable. In the event Purchaser exercises its rights under the preceding sentence, each Holder agrees to suspend, promptly upon their receipt of the notice referred to above, its use of any prospectus relating to such registration in connection with any sale or offer to sell and transfer Registrable Securities.
Section 4. Shelf Registration Procedures. In connection with the filing of the Shelf Registration Statement and any Public Offering of Registrable Securities in accordance with this Annex 27, Purchaser shall:
(a) before filing the Shelf Registration Statement or any amendments or supplements thereto, furnish to the Holders copies of all such documents proposed to be filed, which documents shall be subject to review and comment of such Holders and their counsel;
(b) with respect to the Shelf Registration Statement, use its reasonable best efforts (A) to cause the Shelf Registration Statement to be declared effective on or prior to the date which is three (3) months after the Closing Date, (B) keep the Shelf Registration Statement effective with the SEC for the period of time required by this Annex 27, (C) re-file the Shelf Registration Statement upon its expiration and (D) cooperate in any shelf take-down by amending or supplementing the prospectus related to such Shelf Registration Statement as may be requested by any Holder to enable a Public Offering of Registrable Securities, in each case until there are no longer any Registrable Securities held by the Holders (or any longer period required under the Securities Act);
(c) furnish to each Holder such number of copies, without charge, of the Shelf Registration Statement, each amendment and supplement thereto, including each preliminary prospectus, final prospectus, any other prospectus (including any prospectus filed under Rule 424, Rule 430A or Rule 430B under the Securities Act and any “issuer free writing prospectus” as such term is defined under Rule 433 under the Securities Act), all exhibits and other documents filed therewith and such other documents a Holder may reasonably request including in order to facilitate a Public Offering by such Holder;
(d) use its reasonable best efforts to register or qualify such Registrable Securities under such other securities or blue sky laws of such jurisdictions any Holder reasonably requests and do any and all other acts and things that may be reasonably necessary or reasonably advisable to enable the Holders to consummate a Public Offering in such jurisdictions; provided that Purchaser shall not be required to (A) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this subsection (d), (B) subject itself to taxation in any such jurisdiction or (C) consent to general service of process in any such jurisdiction;
(e) notify each Holder as promptly as reasonably practicable at any time when a prospectus relating to a Public Offering is required to be delivered under the Securities Act, upon discovery that, or upon the discovery of the happening of any event as a result of which, the prospectus contains any untrue statement of a material fact or omits any fact necessary to make the statements therein not misleading in the light of the circumstances under which they were made, and, as soon as reasonably practicable, prepare and furnish to such Holder a reasonable number of copies of a supplement or amendment to such prospectus so that, as thereafter delivered to the purchasers of such Registrable Securities, such prospectus shall not contain any untrue statement of a material fact or omit to state any fact necessary to make the statements therein not misleading in the light of the circumstances under which they were made;
(f) notify each Holder as promptly as reasonably practicable (A) when any Shelf Registration Statement, or the prospectus or any prospectus supplement or post-effective amendment relating to such Shelf Registration Statement, has been filed and when any such post-effective amendment has become effective, (B) after it becomes aware of any comments received on the Shelf Registration Statement from the SEC, (C) after it becomes aware of any request by the SEC for amendments or supplements to such Shelf Registration Statement or to amend or to supplement such prospectus or for additional information, and (D) after it becomes aware of the issuance by the SEC of any stop order suspending the effectiveness of such Shelf Registration Statement or the initiation of any proceedings for any of such purposes;
(g) use its reasonable best efforts to cause all applicable Registrable Securities to be listed on the NYSE or such other market on which the Purchaser Common Shares are then listed or quoted, subject to official notice of issuance;
(h) provide a transfer agent and registrar for all applicable Registrable Securities not later than the effective date of the Shelf Registration Statement and otherwise enable any Registrable Securities sold pursuant to such Shelf Registration Statement to be
in such denominations and registered in such names as the lead underwriter, if any, or the Holder may request (subject to the other provisions of this Annex 27);
(i) enter into such customary agreements (including underwriting agreements and, subject to Section 11, lock-up agreements in customary form for up to ninety (90) days, and including provisions with respect to indemnification and contribution in customary form) and take all such other customary actions the Holders and the underwriters, if any, reasonably request in order to expedite or facilitate a Public Offering (including making members of management and executives of Purchaser available to participate in “road shows,” similar sales events and other marketing activities and delivering any certificates of officers of Purchaser); provided that such participation shall not unreasonably interfere with the business operations of Purchaser;
(j) make available for inspection by any Holder, any underwriter participating in any Public Offering and any attorney, accountant or other agent retained by any Holder or underwriter, all financial and other records, pertinent corporate documents and documents relating to the business of Purchaser, and cause Purchaser’s officers, directors, employees and independent accountants to supply all information reasonably requested by any such Holder, underwriter, attorney, accountant or agent in connection with Public Offering, in each case, as shall be reasonably necessary to enable them to conduct a customary due diligence investigation; provided that Purchaser may require as a condition to such inspection and receipt of such information that the inspecting Person enter into a confidentiality agreement in form and substance reasonably satisfactory to Purchaser;
(k) timely provide to its security holders earnings statements satisfying the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder;
(l) in the event of the issuance of any stop order suspending the effectiveness of the Shelf Registration Statement, or of any order suspending or preventing the use of any related prospectus or ceasing trading of any securities included in the Shelf Registration Statement for sale in any jurisdiction, use its reasonable best efforts to promptly obtain the withdrawal of such order;
(m) use its reasonable best efforts to obtain one or more comfort letters, addressed to the underwriters, if any, dated the effective date of any underwriting agreement and the date of the closing under the underwriting agreement for such offering (including any over-allotment or “green shoe” closing), signed by Purchaser’s independent public accountants in customary form and covering such matters of the type customarily covered by comfort letters as such underwriters shall reasonably request;
(n) provide legal opinions of Purchaser’s counsel, addressed to the underwriters, if any, dated the date of the closing under the underwriting agreement, with respect to the Shelf Registration Statement, each amendment and supplement thereto (including the preliminary prospectus) and such other documents relating thereto as the underwriter shall reasonably request in customary form and covering such matters of the type customarily covered by legal opinions of such nature; and
(o) cooperate with each seller of Registrable Securities and each underwriter or agent participating in the disposition of such Registrable Securities and their respective counsel in connection with any filings required to be made with the Financial Industry Regulatory Authority.
Section 5. Provision of Information. As a condition to registering Registrable Securities, Purchaser may require each Holder of Registrable Securities as to which any registration is being effected to furnish Purchaser with such information regarding such Holder and pertinent to the disclosure requirements relating to the registration and the distribution of such securities as Purchaser may from time to time reasonably request in writing.
Section 6. Underwritten Offerings. If any Holder intends that the Registrable Securities shall be distributed by means of an underwritten offering, such Holder shall so advise Purchaser; provided, however, that an underwritten offering must be for a number of Registrable Securities with an aggregate market value, calculated based on the closing price of such Registrable Securities on the Business Day immediately prior to the commencement of marketing for such sale or offering, that is equal to at least one hundred million Dollars ($100,000,000). In such event, the lead underwriter to administer the offering shall be chosen by such Holder; provided, that at least one of the joint bookrunning managers is selected by Purchaser.
Section 7. Registration Expenses. All expenses incidental to Purchaser’s performance of or compliance with this Annex 27, including all registration and filing fees, fees and expenses of compliance with securities or blue sky laws, word processing, duplicating and printing expenses, messenger and delivery expenses, and fees and disbursements of counsel for Purchaser and all independent certified public accountants and other Persons retained by Purchaser (all such expenses, “Registration Expenses”), shall be borne by Purchaser. Purchaser shall, in any event, pay its internal expenses (including all salaries and expenses of its officers and employees performing legal or accounting duties), the expenses of any annual audit or quarterly review, the expenses of any liability insurance and the expenses and fees for listing the Registrable Securities on each securities exchange on which the same series of securities or similar securities issued by Purchaser are then listed. The Holders of the securities so registered shall pay all underwriting discounts, selling commissions and transfer taxes applicable to the sale of Registrable Securities hereunder, the fees and expenses of counsel beyond the one law firm paid for by Purchaser and any other Registration Expenses required by Law to be paid by a selling Holder pro rata on the basis of the amount of proceeds from the sale of their securities so registered.
Section 8. Supplemented or Amended Prospectus. Each Holder that is participating in any registration hereunder agrees that, upon receipt of any notice from Purchaser of the happening of any event of the kind described in Section 4(e), such Holder shall forthwith discontinue the disposition of its Registrable Securities pursuant to the Registration Statement until such Holder receives copies of a supplemented or amended prospectus as contemplated by Section 4(e).
Section 9. Holdback. With respect to any underwritten offering of Registrable Securities under the Shelf Registration Statement, Purchaser agrees not to effect any public sale or distribution, or to file any Registration Statement covering any Purchaser Common Shares or other of its equity securities or any securities convertible into or exchangeable or exercisable for such securities (other than with respect to awards pursuant to employee benefit plans and issuances of Purchaser Common Shares upon exercise of any such awards) during the Holdback Period with respect to such underwritten offering.
Section 10. Rule 144 under the Securities Act.
(a) Purchaser shall (i) timely file all reports and other documents required to be filed by it under the Securities Act and the Exchange Act and the rules and regulations adopted by the SEC thereunder (or, if Purchaser is not required to file such reports, it shall, upon the request of any Holder, make publicly available such information as necessary to permit sales pursuant to Rule 144 under the Securities Act) and (ii) take such further action any Holder may reasonably request to the extent required from time to time to enable such Holder to sell Registrable Securities without registration under the Securities Act within the limitation of the exemptions provided by Rule 144 under the Securities Act. Upon the request of any Holder, Purchaser shall deliver to such Holder a written statement as to whether it has complied with such information requirements.
(b) Purchaser shall provide a transfer agent and registrar for all applicable Registrable Securities to be sold pursuant to Rule 144 not later than (5) Business Days following the written request of any Holder and otherwise enable any Registrable Securities sold pursuant to Rule 144 to be in such denominations and registered in such names as the Holder may reasonably request.
Section 11. Indemnification.
(a) Indemnification by Purchaser. Purchaser shall indemnify, defend and hold harmless Seller Parent, any Holders, their Affiliates and their respective directors, officers, shareholders, partners, members, attorneys, accountants, agents, Representatives and employees and their heirs, successors and permitted assigns, each in their capacity as such (the “Holder Indemnified Parties”), from, against and in respect of any and all losses, claims, damages, liabilities (or actions in respect thereof, whether or not such indemnified party is a party thereto) and expenses, joint or several (including reasonable costs of investigation and legal expenses) (each, an “Indemnified Loss” and collectively “Indemnified Losses”) arising out of or based upon any untrue statement (or alleged untrue statement) of a material fact contained in any applicable Registration Statement (or in any preliminary or final prospectus contained therein, any document incorporated by reference therein or issuer free writing prospectus related thereto), pursuant to which a Holder has sold Registrable Securities, or any other offering circular, amendment of or supplement to any of the foregoing or other document incident to any such registration, qualification, or compliance, or arising out of or based upon any omission (or alleged omission) to state therein (in the case of a final or preliminary prospectus or issuer free writing prospectus, in light of the circumstances under which they were made) a material fact required to be
stated therein or necessary to make the statements therein not misleading; provided, that Purchaser shall not be liable to a Holder Indemnified Party in any such case to the extent that any such Indemnified Losses arise out of or are based upon any untrue statement or omission by the applicable selling Holder but only to the extent that such untrue statement (or alleged untrue statement) or omission (or alleged omission) is made in such Registration Statement (or in any preliminary or final prospectus contained therein, any document incorporated by reference therein or issuer free writing prospectus related thereto), offering circular, amendment or supplement to any of the foregoing or other document in reliance upon and in conformity with written information furnished to Purchaser by such selling Holder specifically for inclusion in such document.
(b) Indemnification by Selling Holders. Each Holder shall, severally and not jointly, indemnify, defend and hold harmless the Purchaser Indemnified Parties, from and against all Indemnified Losses arising out of or based upon any untrue statement (or alleged untrue statement) of a material fact contained in any such Registration Statement (or in any preliminary or final prospectus contained therein, any document incorporated by reference therein or issuer free writing prospectus related thereto) or any other offering circular or any amendment of or supplement to any of the foregoing or any other document incident to such registration, or any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein (in the case of a final or preliminary prospectus or issuer free writing prospectus, in light of the circumstances under which they were made) not misleading, in each case solely to the extent that such untrue statement (or alleged untrue statement) or omission (or alleged omission) is made in such Registration Statement (or in any preliminary or final prospectus contained therein, any document incorporated by reference therein or issuer free writing prospectus related thereto), offering circular, or any amendment of or supplement to any of the foregoing or other document in reliance upon and in conformity with written information furnished to Purchaser by such Holder expressly for inclusion in such document.
(c) Conduct of Indemnification Proceedings. The provisions of Section 9.4 and Section 9.5 of the Agreement shall apply mutatis mutandis to claims for indemnification brought pursuant to this Section 11.
(d) Contribution. If the indemnification provided for in Section 11(a) or Section 11(b) is unavailable to a party that would have been entitled to indemnification pursuant to Section 11(a) or Section 11(b) (an “Indemnitee”) in respect of any Indemnified Losses referred to therein, then each party that would have been an indemnifying party thereunder shall, subject to Section 11(e) and in lieu of indemnifying such Indemnitee, contribute to the amount paid or payable by such Indemnitee as a result of such Indemnified Losses in such proportion as is appropriate to reflect the relative fault of such indemnifying party on the one hand and such Indemnitee on the other in connection with the statements or omissions which resulted in such Indemnified Losses. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by such indemnifying party or such Indemnitee and the parties’ relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Parties agree that it would not be just or equitable if contribution pursuant to this Section 11(d) were determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the preceding sentence. The amount paid or payable by a contributing party as a result of the Indemnified Losses referred to above in this Section 11(d) shall include any legal or other expenses reasonably incurred by such Indemnitee in connection with investigating or defending any such action or claim. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.
(e) Survival. The indemnification of Purchaser contained in Section 11(a) and the contribution provisions of Section 11(d) shall remain in full force and effect regardless of (i) the transfer of the applicable Registrable Securities, (ii) any investigation made by or on behalf of any Holder and (iii) the acceptance by Seller Parent of the Consideration Shares at the Closing.
(f) Limitation on Liability of Holders. The liability of each Holder of Registrable Securities in respect of any indemnification or contribution obligation of such Holder arising under this Section 11 shall not in any event exceed an amount equal to the net proceeds to such Holder (after deduction of all underwriters’ discounts and commissions) from the disposition of the Registrable Securities disposed of by such Holder pursuant to such registration.
Section 12. Standstill. For so long as Seller Parent and its Subsidiaries Beneficially Own four percent (4%) or more of the outstanding Purchaser Common Shares, Seller Parent shall not, and shall cause its Subsidiaries not to, without the prior written consent at Purchaser (such consent not to be unreasonably withheld, delayed or conditioned):
(a) acquire, offer to acquire, or agree to acquire, directly or indirectly (including through derivative securities or instruments), Beneficial Ownership of any Purchaser Common Shares (other than any Purchaser Common Shares received by way of stock splits, stock dividends, reclassifications, recapitalizations or other distributions by Purchaser in respect of Purchaser Common Shares);
(b) offer, propose or publicly announce any tender offer, exchange offer or merger in respect of Purchaser Common Shares;
(c) (i) commence, conduct or participate in any “solicitation” of “proxies,” “consents” or “authorizations” (as such terms are used in the proxy rules of the SEC promulgated under the Exchange Act) to vote any Purchaser Common Shares, unless such solicitation has been commenced by Purchaser;
(d) communicate with shareholders of Purchaser pursuant to Rule 14a-1(l)(2)(iv) under the Exchange Act, in each case in respect of any of the types of matters set forth in this Section 12;
(e) form, join or in any way participate in a “group” as defined in Section 13(d)(3) of the Exchange Act with any Person for the purpose of voting, acquiring, holding, or disposing of, any Purchaser Common Shares with respect to any of the types of matters set forth in this Section 12;
(f) call or seek to call any meeting of shareholders of Purchaser;
(g) make any shareholder proposals of the type contemplated by Section 1.9 of the Amended and Restated Bylaws of the Purchaser, adopted as of September 5, 2018;
(h) (i) act, seek, facilitate or encourage any Person to submit nominations or proposals, whether in furtherance of a “contested solicitation” or otherwise, for the appointment, election or removal of directors of the Purchaser Board, (ii) in the case of any such “contested solicitation,” vote any Purchaser Common Shares in any manner other than as recommended by the Purchaser Board or abstain from voting such Purchaser Common Shares or (iii) seek, facilitate, encourage, or take any other action with respect to the appointment, election or removal of any directors of the Purchaser Board, other than in accordance with Purchaser’s recommendation;
(i) contest the validity or enforceability of any provision contained in this Section 12;
(j) take any action that would reasonably be expected to require Purchaser to make a public announcement with respect to any of the types of matters set forth in this Section 12; or
(k) enter into any negotiations, arrangements or understandings with any third party with respect to any of the foregoing activities;
provided that nothing contained in this Section 12 shall be construed to restrict the ability of Seller Parent and its Subsidiaries to comply with any applicable disclosure obligations under applicable Law, including Section 13 of the Exchange Act and the regulations promulgated thereunder, and any notice, filing or other communication made by or on behalf of Seller Parent of its Subsidiaries in order to comply with their respective obligations under the U.S. federal securities Laws or other applicable Laws shall not be deemed to be a breach of this Section 12.
Section 13. Definitions. As used in this Annex, the following terms have the meanings set forth below:
“Beneficially Own” or “Beneficial Ownership” means, with respect to any Registrable Securities, having “beneficial ownership” of such securities for purposes of Rule 13d-3 or 13d-5 under the Exchange Act.
“Holdback Period” means, with respect to any registered offering of Purchaser’s securities, (i) the period during the ten (10) days before and ninety (90) days after the effective date of the applicable Registration Statement (or such lesser period as
the lead or managing underwriters may reasonably require) or, in the case of a takedown from the Shelf Registration Statement, ninety (90) days after the date of the prospectus supplement filed with the SEC in connection with such takedown (or such lesser period as the lead or managing underwriters may reasonably require) and during such prior period (not to exceed ten (10) days) as to which Purchaser has given reasonable written notice to the Holders or (ii) such shorter period as Seller Parent shall determine.
“Holder” means any Person who Beneficially Owns any Registrable Securities as a result of this Agreement and any Affiliate of such Person to which any Registrable Securities have been transferred.
“Indemnified Losses” has the meaning set forth in Section 11(a) of this Annex 27.
“Indemnitee” has the meaning set forth in Section 11(d) of this Annex 27.
“Joinder Agreement” means a joinder agreement in all material respects in the form attached as Schedule 1 to this Annex 27.
“Lock-Up Period” shall have the meaning set forth in Section 1 of this Annex 27.
“Prohibited Transferee” means any Person that, to the Knowledge of Seller Parent, after reasonable inquiry (including, where practicable, obtaining a representation of the ownership of Purchaser Common Shares of such transferee), is required to, or upon consummation of a Transfer, would be required to, file a Schedule 13D with the SEC.
“Public Offering” means a public offering and sale of Registrable Securities for cash pursuant to an effective Registration Statement under the Securities Act.
“Registration Expenses” shall have the meaning set forth in Section 7 of this Annex 27.
“Registrable Securities” means (i) the Consideration Shares and (ii) any equity securities issued or issuable directly or indirectly with respect to the Consideration Shares by way of share dividend or share split or in connection with a combination of shares, recapitalization, reclassification, merger, amalgamation, scheme of arrangement, consolidation or other reorganization; provided, however, that any such securities shall cease to be Registrable Securities when (A) they have been resold by a Holder pursuant to an effective Registration Statement; (B) they have been resold by a Holder pursuant to Rule 144 under the Securities Act; or (C) they may be resold by the applicable Holder pursuant to Rule 144 under the Securities Act and not subject to any volume or manner of sale limitations imposed thereunder, and the Holder, together with its Affiliates, holds no more than one percent (1%) of the outstanding Purchaser Common Shares.
“Registration Statement” means a prospectus and other documents filed with the SEC to effect a registration of the Registrable Securities for resale under the Securities Act.
“Shelf Registration Statement” means a registration statement on Form S-3 (or any successor form thereto) providing for the registration of, and the sale on a continuous or delayed basis of, the Registrable Securities pursuant to Rule 415 under the Securities Act.
“Suspension Period” shall have the meaning set forth in Section 3 of this Annex.
“Transfer” shall have the meaning set forth in Section 1 of this Annex.
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11 S. Meridian Street |
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Indianapolis, IN 46204-3535 U.S.A. |
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January 21, 2020
Elanco Animal Health Incorporated
2500 Innovation Way
Greenfield, Indiana 46140
Re: Elanco Animal Health Incorporated Registration Statement on Form S-3
Ladies and Gentlemen:
We have acted as Indiana counsel to Elanco Animal Health Incorporated, an Indiana corporation (the “Company”), in connection with the Registration Statement on Form S-3 (the “Registration Statement”) under the Securities Act of 1933, as amended (the “Securities Act”), in the form to be filed with the Securities and Exchange Commission (the “SEC”), relating to the registration of an undetermined dollar amount (or its foreign currency equivalent) of: (i) shares of the Company’s common stock, without par value (the “Common Stock”); (ii) shares of the Company’s preferred stock, without par value (the “Preferred Stock”), which may be represented by depositary shares (the “Depositary Shares”); (iii) one or more series of debt securities of the Company (the “Debt Securities”); (iv) warrants to purchase Common Stock, Preferred Stock or Debt Securities (the “Warrants”); (v) rights to purchase Common Stock, pursuant to which the holder will purchase for cash the principal amount of shares of Common Stock at a specified exercise price (the “Rights”); (vi) stock purchase contracts, pursuant to which the holder will purchase from the Company a specified number of shares of Common Stock at a future date (the “Stock Purchase Contracts”); and (vii) stock purchase units, consisting of Stock Purchase Contracts and a security (of the Company or another issuer) securing the holder’s obligation to purchase the Common Stock under the Stock Purchase Contracts (the “Stock Purchase Units” and, together with the Depositary Shares, the Debt Securities, the Warrants, the Rights and the Stock Purchase Contracts, the “Covered Securities”). The Common Stock, Preferred Stock and Covered Securities are collectively referred to herein as the “Offered Securities”.
Unless otherwise specified in the applicable prospectus supplement, the Preferred Stock will be issued in one or more series and the relative powers, designations, preferences, rights and qualifications, limitations or restrictions of such Preferred Stock will be set forth in one or more
Elanco Animal Health Incorporated
January 21, 2020
articles of amendment amending the amended and restated articles of incorporation of the Company, to be adopted by the Company’s board of directors and filed with the Secretary of State of the State of Indiana (each, the “Articles of Amendment”). Each of the Articles of Amendment will be in a form to be filed as an exhibit to the Registration Statement or incorporated by reference therein.
Any Debt Securities are to be issued pursuant to an Indenture, dated as of August 28, 2018, as amended and supplemented by the First Supplemental Indenture, dated August 28, 2018 (collectively, the “Indenture”), between the Company and Deutsche Bank Trust Company Americas, as trustee. Any Depositary Shares are to be issued pursuant to a deposit agreement (including a form of depositary receipt evidencing the Depositary Shares) (the “Deposit Agreement”), to be dated on or about the date of the first issuance of Depositary Shares thereunder, by and between the Company and a financial institution identified therein as the depositary, which Deposit Agreement will be filed as an exhibit to the Registration Statement or incorporated by reference therein. Any Warrants are to be issued pursuant to a warrant agreement (including a form of certificate evidencing the Warrants) (the “Warrant Agreement”), to be dated on or about the date of the first issuance of Warrants thereunder, by and between the Company and a financial institution identified therein as the warrant agent, which Warrant Agreement will be filed as an exhibit to the Registration Statement or incorporated by reference therein. Any Rights are to be issued pursuant to a rights agent agreement (the “Rights Agreement”), to be dated on or about the date of the first issuance of the Rights, by and between the Company and the financial institution identified therein as the rights agent, which Rights Agreement will be filed as an exhibit to the Registration Statement or incorporated by reference therein. Any Stock Purchase Contracts are to be issued pursuant to a purchase contract agreement (including a form of Purchase Contract) (the “Stock Purchase Contract Agreement”), to be dated on or about the date of the first issuance of Stock Purchase Contracts thereunder, by and between the Company and a financial institution identified therein as the stock purchase contract agent, which Stock Purchase Contract Agreement will be filed as an exhibit to the Registration Statement or incorporated by reference therein. Any Stock Purchase Units are to be issued pursuant to a purchase contract agreement (including a form of Unit Agreement) (the “Stock Purchase Unit Agreement”), to be dated on or about the date of the first issuance of Stock Purchase Units thereunder, by and between the Company and a financial institution identified therein as the stock purchase unit agent, which Stock Purchase Unit Agreement will be filed as an exhibit to the Registration Statement or incorporated by reference therein.
This opinion letter is being delivered in accordance with the requirements of Item 601(b)(5) of Regulation S-K under the Securities Act.
In connection with this opinion we have examined the Amended and Restated Articles of Incorporation (the “Articles”) and Amended and Restated Bylaws (the “Bylaws”) of the Company, each as amended as of the date hereof, the Indenture, the Registration Statement, the proceedings taken by the Company in connection with the authorization and filing of the Registration Statement. We have also examined originals or copies, certified or otherwise identified to our satisfaction, of such documents, corporate records, instruments and other relevant materials as we deemed advisable and have made such examination of statutes and decisions and reviewed such
BARNESÞBURGLLP
Elanco Animal Health Incorporated
January 21, 2020
questions of law as we have considered necessary or appropriate. As to facts material to this opinion letter, we have relied upon certificates, statements or representations of public officials, of officers and representatives of the Company and of others, without any independent verification thereof.
In our examination, we have assumed: (a) the legal capacity of all natural persons; (b) the genuineness of all signatures; (c) the authenticity of all documents submitted to us as originals; (d) the conformity to original documents of all documents submitted to us as certified, conformed, photostatic or facsimile copies; (e) the authenticity of the originals of such latter documents; (f) the truth, accuracy and completeness of the information, representations and warranties contained in the records, documents, instruments, certificates and records we have reviewed; and (g) the absence of any undisclosed modifications to the Articles, the Bylaws or the agreements and instruments reviewed by us.
Based on and subject to the foregoing and to the other qualifications, assumptions and limitations set forth herein, we are of the opinion that:
1. The Company is validly existing as an Indiana corporation.
2. With respect to any offering of Common Stock, including Common Stock issuable upon conversion of Preferred Stock, when (i) a prospectus supplement and any other offering material with respect to the Common Stock have been filed with the SEC in compliance with the Securities Act and the rules and regulations thereunder; (ii) the appropriate corporate action has been taken by the Company to authorize the issuance of the Common Stock; (iii) any legally required consents, approvals, authorizations and other orders of the SEC and any other regulatory authorities are obtained; (iv) unless issued without certificates, certificates representing the Common Stock have been duly executed by the duly authorized officers of the Company, countersigned by the transfer agent therefor and delivered to the purchasers thereof or other persons entitled thereto; (v) the shares of Common Stock have been issued by the Company against payment of the agreed-upon consideration therefor in accordance with any relevant agreements and such corporate action; and (vi) in the case of Common Stock issuable upon conversion of Preferred Stock, the actions in respect of such Preferred Stock referred to in paragraph 3 hereof have been completed, then, upon the happening of such events, such Common Stock will be validly issued, fully paid and nonassessable.
3. With respect to any offering of any series of Preferred Stock, when (i) a prospectus supplement and any other offering material with respect to the Preferred Stock have been filed with the SEC in compliance with the Securities Act and the rules and regulations thereunder; (ii) the Articles of Amendment establishing the designations, preferences, rights, qualifications, limitations or restrictions of such series of Preferred Stock have been duly approved by appropriate corporate action, executed by duly authorized officers of the Company and filed by the Company with the Secretary of State of the State of Indiana, all in accordance with the laws of the State of Indiana; (iii) appropriate corporate action has been taken by the Company to authorize the issuance of the Preferred Stock; (iv) any legally required consents, approvals, authorizations and other orders of the SEC and any other regulatory authorities are obtained; (v) Preferred Stock with terms so fixed have been issued by the Company against payment of the agreed-upon consideration therefor in accordance with any relevant agreements and such corporate action; and (vi) unless
BARNESÞBURGLLP
Elanco Animal Health Incorporated
January 21, 2020
issued without certificates, certificates representing the Preferred Stock have been duly executed by the duly authorized officers of the Company, countersigned by the transfer agent therefor and delivered to the purchasers thereof, then, upon the happening of such events, the Preferred Stock will be validly issued, fully paid and nonassessable.
4. The Company has the corporate power to create one or more series of Covered Securities and to enter into supplements to the Indenture and the other agreements required for issuance of the Covered Securities that are contemplated in the Registration Statement, including but not limited to Deposit Agreements, Warrant Agreements, Rights Agreements, Stock Purchase Contract Agreements and Stock Purchase Unit Agreements..
5. With respect to any offering of Covered Securities, if the Covered Securities are convertible into Common Stock or Preferred Stock or if Common Stock or Preferred Stock may be acquired upon exercise or otherwise upon fulfillment of the terms of the Covered Securities, when (i) a prospectus supplement and any other offering material with respect to the Covered Securities have been filed with the SEC in compliance with the Securities Act and the rules and regulations thereunder; (ii) Articles of Amendment establishing the designations, preferences, rights, qualifications, limitations or restrictions of any series of Preferred Stock have been duly approved by appropriate corporate action, executed by duly authorized officers of the Company and filed by the Company with the Secretary of State of the State of Indiana, all in accordance with the laws of the State of Indiana; (iii) the appropriate corporate action has been taken by the Company to authorize the issuance of such Covered Securities and such Common Stock or Preferred Stock as described in paragraphs 2 and 3, above, respectively; (iv) any legally required consents, approvals, authorizations and other orders of the SEC and any other regulatory authorities are obtained; (v) the Covered Securities have been presented for conversion, exercise or fulfillment in accordance with the terms thereof together with any consideration, certificates and/or instructions required in connection therewith by such Covered Security; and (vi) unless issued without certificates, certificates representing such Common Stock or Preferred Stock have been duly executed by the duly authorized officers of the Company, countersigned by the transfer agent therefor and delivered upon such conversion, exercise or fulfillment to the persons entitled thereto, in accordance with the terms of such Covered Securities, then, upon the happening of such events, the Common Stock or Preferred Stock issuable upon conversion, exercise or fulfillment of the Covered Securities will be validly issued, fully paid and non-assessable.
For the purposes of this opinion letter, we have assumed that, at the time of the issuance, sale and delivery of each issue of Offered Securities: (i) the Company will remain validly existing under Indiana law; (ii) the Registration Statement and any additional required post-effective amendments thereto have all become effective under the Securities Act, such effectiveness has not been terminated or rescinded, and comply with all applicable laws; (iii) any Offered Securities being offered will be issued and sold in compliance with applicable federal and state securities laws and as contemplated in the Registration Statement or the prospectus supplement relating thereto; (iv) any legally required consents, approvals, authorizations and other orders of the SEC and any other governmental or regulatory authorities have been obtained, (v) the information, representations and warranties contained in the instruments, documents, certificates and records we have reviewed continue to be true, accurate and complete; (vi) all actions necessary for the issuance of any Common Stock or Preferred Stock and the form and terms thereof will not
BARNESÞBURGLLP
Elanco Animal Health Incorporated
January 21, 2020
(a) contravene the Articles or Bylaws, (b) violate any law, rule or regulation applicable to the Company or (c) result in any conflict with or breach of any agreement or document binding on the Company; (vii) the authorization of any Common Stock or Preferred Stock by the Company will not have been modified or rescinded, and there will not have occurred any change in law affecting the issuance thereof; (viii) the Articles and the Bylaws, as currently in effect, will not have been modified or amended and will be in full force and effect, and the number of Common Stock or Preferred Stock, as the case may be, offered and sold will not exceed the number of Common Stock or Preferred Stock, as the case may be, authorized under the Articles (as then in effect) and not otherwise reserved for issuance; (ix) the certificates, if any, evidencing the Common Stock or the Preferred Stock will be in a form approved for issuance by the Company, which complies with the Indiana Business Corporation Law; and (x) there shall not have occurred any change in law affecting the validity of any Offered Securities to be issued.
We have further assumed that, at the time of the issuance, sale and delivery of Covered Securities: (i) all Covered Securities will constitute valid and legally binding obligations of the Company, enforceable against the Company in accordance with their terms, except to the extent such assumption states, directly or in practical effect, the legal conclusion expressed in paragraph 4 of this opinion letter; (ii) the execution, delivery and performance by the Company of any supplemental indentures, and any agreements or other documents relating to the issuance of the Covered Securities, as applicable, and all actions necessary for the issuance of the Covered Securities, and the forms and terms thereof, will comply with all requirements and restrictions, if any, applicable to the Company, whether imposed by any agreement or instrument to which the Company is a party or by which it is bound or any court or other governmental or regulatory body having jurisdiction over the Company; and (iii) there will not have occurred any change in law affecting the legally binding character or enforceability thereof.
In rendering the foregoing opinions, we express no opinion with respect to the laws of any jurisdiction other than the laws of the State of Indiana.
We are furnishing this opinion letter to you in connection with the filing of the Registration Statement. This opinion letter is limited to the matters set forth herein, and no other opinion should be inferred beyond the matters expressly stated. The opinions set forth herein are given as of the date hereof, and we undertake no obligation to update or supplement this letter if any applicable law changes after the date hereof or if we become aware of any fact or other circumstances that changes or may change any opinion set forth herein after the date hereof or for any other reason.
We hereby consent to the filing of this opinion letter with the SEC as an exhibit to the Registration Statement and the reference to our firm under the heading “Legal Matters” in the prospectus which forms a part of the Registration Statement. In giving such consent, we do not thereby admit that we are within the category of persons whose consent is required by Section 7 of the Securities Act or the related rules promulgated by the SEC.
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Very truly yours, |
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/s/ Barnes & Thornburg LLP |
BARNESÞBURGLLP
Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
New York, NY 10019-6064
January 21, 2020
Elanco Animal Health Incorporated
2500 Innovation Way,
Greenfield, IN 46140
Registration Statement on Form S-3ASR
Ladies and Gentlemen:
In connection with the Registration Statement on Form S-3ASR (the “Registration Statement”) of Elanco Animal Health Incorporated, an Indiana corporation (the “Company”), filed today with the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended (the “Act”), and the rules and regulations thereunder (the “Rules”), you have asked us to furnish our opinion as to the legality of the securities being registered under the Registration Statement. The Registration Statement relates to the registration under the Act of the following securities of the Company (together, the “Securities”):
A. debt securities (the “Debt Securities”);
B. shares of preferred stock (including shares issuable upon conversion of the Debt Securities or upon the exercise of warrants or purchase contracts) of the Company, no par value per share (the “Preferred Stock”);
C. shares of common stock (including shares issuable upon conversion or exchange of the Debt Securities or Preferred Stock or upon the exercise of
warrants, rights or purchase contracts) of the Company, no par value per share (the “Common Stock”);
D. depositary shares representing a fractional share or multiple shares of Preferred Stock evidenced by depositary receipts (the “Depositary Shares”);
E. warrants to purchase Debt Securities, Preferred Stock, Common Stock, Depositary Shares or any combination of them (the “Warrants”);
F. rights to purchase Common Stock (the “Rights”);
G. purchase contracts representing the Company’s obligation to sell Debt Securities, Preferred Stock, Common Stock, Depositary Shares, Warrants or government securities (the “Purchase Contracts”); and
H. units consisting of any combination of two or more of Debt Securities, Preferred Stock, Common Stock, Depositary Shares, Warrants, Purchase Contracts or debt obligations of third parties, including government securities (the “Units”).
The Securities are being registered for offering and sale from time to time as provided by Rule 415 under the Act.
The Debt Securities are to be issued under one or more supplemental indentures to the Indenture, dated as of August 28, 2018, between the Company and Deutsche Bank Trust Company Americas, as trustee (the “Indentures”).
The Depositary Shares are to be issued under deposit agreements, each between the Company and a depositary to be identified in the applicable agreement (each, a “Depositary Agreement”). The Warrants are to be issued under warrant agreements, each between the Company and a warrant agent to be identified in the applicable agreement (each, a “Warrant Agreement”). The Rights are to be issued under rights agent agreements, each between the Company and a rights agent to be identified in the applicable agreement (each, a “Rights Agent Agreement”). The Purchase Contracts will be issued under purchase contract agreements, each between the Company and a purchase contract agent to be identified in the applicable agreement (each, a “Purchase Contract Agreement”). The Units are to be issued under unit agreements, each between the Company and a unit agent to be identified in the applicable agreement (each, a “Unit Agreement”).
In connection with the furnishing of this opinion, we have examined originals, or copies certified or otherwise identified to our satisfaction, of the following documents:
1. the Registration Statement; and
2. the Indenture incorporated by reference as Exhibit 4.4 to the Registration Statement.
In addition, we have examined such certificates, agreements and documents as we deemed relevant and necessary as a basis for the opinions expressed below. We have also relied upon the factual matters contained in the representations and warranties of the Company made in the documents reviewed by us and upon certificates of public officials and the officers of the Company
In our examination of the documents referred to above, we have assumed, without independent investigation, the genuineness of all signatures, the legal capacity of all individuals who have executed any of the documents reviewed by us, the authenticity of all documents submitted to us as originals, the conformity to the originals of all documents submitted to us as certified, photostatic, reproduced or conformed copies of valid existing agreements or other documents, the authenticity of all such latter documents and that the statements regarding matters of fact in the certificates, records, agreements, instruments and documents that we have examined are accurate and complete.
We have also assumed, without independent investigation, that (i) the Indenture will be duly authorized, executed and delivered by the parties to it in substantially the form filed as an exhibit to the Registration Statement and will be duly qualified under the Trust Indenture Act of 1939, as amended, (ii) each of the Depositary Agreements, the Warrant Agreements, the Rights Agent Agreements, the Purchase Contract Agreements, the Unit Agreements and any other agreement entered into, or officer’s certificates or board resolutions delivered, in connection with the issuance of the Securities will be duly authorized, executed and delivered by the parties to such agreements (such agreements and documents, together with the Indenture, are referred to collectively as the “Operative Agreements”), (iii) each Operative Agreement, when so authorized, executed and delivered, will constitute a legal, valid and binding obligation of the parties thereto (other than the Company), (iv) the Depositary Shares, the Warrants, the Rights, the Purchase Contracts, the Units and any related Operative Agreements will be governed by the laws of the State of New York, (v) in the case of Purchase Contracts or Units consisting at least in part of debt obligations of third parties, such debt obligations at all relevant times constitute the legal, valid and binding obligations of the issuers thereof enforceable against the issuers thereof in accordance with their terms, (vi) the Company is validly existing and in good standing under the laws of the State of Indiana, (vii) the Company has all corporate power and authority to execute and deliver, and perform its obligations under, the Operative Agreements and the Securities, (vii) the execution, delivery and performance of the Operative Agreements and the Securities by the Company does not violate any organizational documents of the Company or the laws of its jurisdiction of incorporation and (ix) the execution, delivery and performance of the Operative Agreements and the Securities and issuance of the Securities do not conflict with or constitute a breach of the terms of any agreement or instrument to which the Company is subject or violate applicable law or contravene any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company.
With respect to the Securities of a particular series or issuance, we have assumed that (i) the issuance, sale, number or amount, as the case may be, and terms of the Securities to be offered from time to time will be duly authorized and established, in accordance with the organizational documents of the Company, the laws of the State of New York and the State of Indiana, and any applicable Operative Agreement, (ii) prior to the issuance of a series of
Preferred Stock, an appropriate certificate of designation or board resolution relating to such series of Preferred Stock will have been duly authorized by the Company and filed with the Secretary of State of Indiana, (iii) the Securities will be duly authorized, executed, issued and delivered by the Company, and, in the case of Debt Securities, Depositary Shares, Warrants, Rights, Purchase Contracts and Units, duly authenticated or delivered by the applicable trustee or agent, in each case, against payment by the purchaser at the agreed-upon consideration and (iv) the Securities will be issued and delivered as contemplated by the Registration Statement and the applicable prospectus supplement.
Based upon the above, and subject to the stated assumptions, exceptions and qualifications, we are of the opinion that:
1. When the specific terms of a particular issuance of Debt Securities (including any Debt Securities duly issued upon exercise, exchange or conversion of any Security in accordance with its terms) have been duly authorized by the Company and such Debt Securities have been duly executed, authenticated, issued and delivered, and, if applicable, upon exercise, exchange or conversion of any Security in accordance with its terms, such Debt Securities will constitute legal, valid and binding obligations of the Company enforceable against the Company in accordance with their terms.
2. When Depositary Shares evidenced by depositary receipts are issued and delivered in accordance with the terms of a Depositary Agreement against the deposit of duly authorized, validly issued, fully paid and non-assessable shares of Preferred Stock, such Depositary Shares will entitle the holders thereof the rights specified in the Depositary Agreement and such Depositary Shares will constitute, legal, valid and binding obligations of the Company enforceable against the Company in accordance with their terms.
3. When the specific terms of a particular issuance of Warrants have been duly authorized by the Company and such Warrants have been duly executed, authenticated, issued and delivered, such Warrants will constitute legal, valid and binding obligations of the Company enforceable against the Company in accordance with their terms.
4. When the specific terms of a particular issuance of Rights have been duly authorized by the Company and such Rights have been duly executed, authenticated, issued and delivered, such Rights will constitute legal, valid and binding obligations of the Company enforceable against the Company in accordance with their terms.
5. When any Purchase Contracts have been duly authorized, executed and delivered by the Company, such Purchase Contracts will constitute legal, valid and binding obligations of the Company enforceable against the Company in accordance with their terms.
6. When any Units have been duly authorized, issued and delivered by the Company, such Units will constitute legal, valid and binding obligations of the Company enforceable against the Company in accordance with their terms.
The opinions expressed above as to enforceability may be subject to (i) bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer, moratorium or
similar laws affecting creditors’ rights generally, (ii) general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law) and (iii) requirements that a claim with respect to any Securities in denominations other than in United States dollars (or a judgment denominated other than into United States dollars in respect of the claim) be converted into United States dollars at a rate of exchange prevailing on a date determined by applicable law.
The opinions expressed above are limited to the laws of the State of New York. Our opinion is rendered only with respect to the laws, and the rules, regulations and orders under those laws, that are currently in effect.
We hereby consent to use of this opinion as an exhibit to the Registration Statement and to the use of our name under the heading “Legal Matters” contained in the prospectus included in the Registration Statement. In giving this consent, we do not hereby admit that we come within the category of persons whose consent is required by the Act or the Rules.
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Very truly yours, |
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/s/ Paul, Weiss, Rifkind, Wharton & Garrison LLP |
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PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP |
Consent of Independent Registered Public Accounting Firm
We consent to the reference to our firm under the caption “Experts” in this Registration Statement (Form S-3) and related Prospectus of Elanco Animal Health Incorporated for the registration of common stock, preferred stock, debt securities, depositary shares, warrants, rights, purchase contracts, and units and to the incorporation by reference therein of our report dated February 20, 2019, with respect to the consolidated and combined financial statements of Elanco Animal Health Incorporated, included in its Annual Report (Form 10-K) for the year ended December 31, 2018, filed with the Securities and Exchange Commission.
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/s/ Ernst & Young LLP |
Indianapolis, Indiana
January 21, 2020
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration Statement on Form S-3 of our report dated August 7, 2019 relating to the financial statements of the Animal Health Business of Bayer Aktiengesellschaft, appearing in the Current Report on Form 8-K of Elanco Animal Health Inc. filed on January 21, 2020. We also consent to the reference to us under the heading “Experts” in such Registration Statement.
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/s/ Deloitte GmbH Wirtschaftsprüfungsgesellschaft |
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Deloitte GmbH |
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Wirtschaftsprüfungsgesellschaft |
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Munich, Germany |
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January 21, 2020 |
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)
DEUTSCHE BANK TRUST COMPANY AMERICAS
(formerly BANKERS TRUST COMPANY)
(Exact name of trustee as specified in its charter)
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13-4941247 |
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(Jurisdiction of Incorporation or |
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(I.R.S. Employer |
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organization if not a U.S. national bank) |
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Identification no.) |
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60 WALL STREET |
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NEW YORK, NEW YORK |
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10005 |
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(Address of principal |
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(Zip Code) |
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executive offices) |
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Deutsche Bank Trust Company Americas
Attention: Mirko Mieth
Legal Department
60 Wall Street, 36th Floor
New York, New York 10005
(212) 250 — 1663
(Name, address and telephone number of agent for service)
Elanco Animal Health Incorporated
Elanco US Inc.
(Exact name of obligor as specified in its charter)
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INDIANA |
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82-5497352 |
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DELAWARE |
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56-2002553 |
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(State or other jurisdiction of |
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(I.R.S. Employer |
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incorporation or organization) |
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Identification No.) |
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2500 INNOVATION WAY |
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GREENFIELD, INDIANA |
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46140 |
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(Address of principal executive offices) |
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(Zip code) |
DEBT SECURITIES
(Title of the Indenture securities)
Item 1. General Information.
Furnish the following information as to the trustee.
(a) Name and address of each examining or supervising authority to which it is subject.
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Name |
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Address |
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Federal Reserve Bank (2nd District) |
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New York, NY |
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Federal Deposit Insurance Corporation |
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Washington, D.C. |
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New York State Banking Department |
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Albany, NY |
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Not Applicable
Items 3-15. Not Applicable
Item 16. List of Exhibits.
Exhibit 1 - Restated Organization Certificate of Bankers Trust Company dated August 31, 1998; Certificate of Amendment of the Organization Certificate of Bankers Trust Company dated September 25, 1998; Certificate of Amendment of the Organization Certificate of Bankers Trust Company dated December 18, 1998;Certificate of Amendment of the Organization Certificate of Bankers Trust Company dated September 3, 1999; and Certificate of Amendment of the Organization Certificate of Bankers Trust Company dated March 14, 2002, incorporated herein by reference to Exhibit 1 filed with Form T-1 Statement, Registration No. 333-201810.
Exhibit 2 - Certificate of Authority to commence business, incorporated herein by reference to Exhibit 2 filed with Form T-1 Statement, Registration No. 333-201810.
Exhibit 3 - Authorization of the Trustee to exercise corporate trust powers, incorporated herein by reference to Exhibit 3 filed with Form T-1 Statement, Registration No. 333-201810.
Exhibit 4 - Existing By-Laws of Deutsche Bank Trust Company Americas, dated March 29, 2019, copy attached.
Exhibit 5 - Not applicable.
Exhibit 6 - Consent of Bankers Trust Company required by Section 321(b) of the Act, incorporated herein by reference to Exhibit 6 filed with Form T-1 Statement, Registration No. 333-201810.
Exhibit 7 - A copy of the latest report of condition of the trustee published pursuant to law or the requirements of its supervising or examining authority.
Exhibit 8 - Not Applicable.
Exhibit 9 - Not Applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as amended, the trustee, Deutsche Bank Trust Company Americas, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on this 21st day of January, 2020.
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DEUTSCHE BANK TRUST COMPANY AMERICAS | ||
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By: |
/s/ Annie V. Jaghatspanyan |
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Name: Annie V. Jaghatspanyan |
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Title: Vice President |
AMENDED AND RESTATED
BY-LAWS
OF
DEUTSCHE BANK TRUST COMPANY AMERICAS
ARTICLE I
STOCKHOLDERS
Section 1.01. Annual Meeting. The annual meeting of the stockholders of Deutsche Bank Trust Company Americas (the “Company”) shall be held in the City of New York within the State of New York within the first four months of the Company’s fiscal year, on such date and at such time and place as the board of directors of the Company (“Board of Directors” or “Board”) may designate in the call or in a waiver of notice thereof, for the purpose of electing directors and for the transaction of such other business as may properly be brought before the meeting.
Section 1.02. Special Meetings. Special meetings of the stockholders of the Company may be called by the Board of Directors or by the President, and shall be called by the President or by the Secretary upon the written request of the holders of record of at least twenty-five percent (25%) of the shares of stock of the Company issued and outstanding and entitled to vote, at such times. If for a period of thirteen months after the last annual meeting, there is a failure to elect a sufficient number of directors to conduct the business of the Company, the Board of Directors shall call a special meeting for the election of directors within two weeks after the expiration of such period; otherwise, holders of record of ten percent (10%) of the shares of stock of the Company entitled to vote in an election of directors may, in writing, demand the call of a special meeting at the office of the Company for the election of directors, specifying the date and month thereof, but not less than two nor more than three months from the date of such call. At any such special meeting called on demand of stockholders, the stockholders attending, in person or by proxy, and entitled to vote in an election of directors shall constitute a quorum for the purpose of electing directors, but not for the transaction of any other business.
Section 1.03. Notice of Meetings. Notice of the time, place and purpose of every meeting of stockholders shall be delivered personally or mailed not less than 10 nor more than 50 days before the date of such meeting (or any other action) to each stockholder of record entitled to vote, at his post office address appearing upon the records of the Company or at such other address as shall be furnished in writing by him to the Secretary of the Company for such purpose. Such further notice shall be given as may be required by law or by these By-Laws. Any meeting may be held without notice if all stockholders entitled to vote are present in person or by proxy, or if notice is waived in writing, either before or after the meeting, by those not present.
Section 1.04. Quorum. The holders of record of at least a majority of the shares of the stock of the Company issued and outstanding and entitled to vote, present in person or by proxy, shall, except as otherwise provided by law, by the Company’s Organization Certificate or by these By-Laws, constitute a quorum at all meetings of the stockholders; if there be no such quorum, the holders of a majority of such shares so present or represented may adjourn the meeting from time to time until a quorum shall have been obtained.
Section 1.05. Organization of Meetings. Meetings of the stockholders shall be presided over by the Chairman of the Board or, if he is not present, by the President or, if he is not present, by a chairman to be chosen at the meeting. The Secretary of the Company, or in his absence an Assistant Secretary, shall act as secretary of the meeting, if present.
Section 1.06. Voting. At each meeting of stockholders, except as otherwise provided by statute, the Company’s Organization Certificate or these By-Laws, every holder of record of stock entitled to vote shall be entitled to one vote in person or by proxy for each share of such stock standing in his name on the records of the Company. Elections of directors shall be determined by a plurality of the votes cast thereat and, except as otherwise provided by statute, the Company’s Organization Certificate or these By-Laws, all other action shall be determined by a majority of the votes cast at such meeting.
At all elections of directors, the voting shall be by ballot or in such other manner as may be determined by the stockholders present in person or by proxy entitled to vote at such election.
Section 1.07. Action by Consent. Except as may otherwise be provided in the Company’s Organization Certificate, any action required or permitted to be taken at any meeting of stockholders may be taken without a meeting, without prior notice and without a vote if, prior to such action, a written consent or consents thereto, setting forth such action, is signed by all the holders of record of shares of the stock of the Company, issued and outstanding and entitled to vote thereon, having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted.
ARTICLE II
DIRECTORS
Section 2.01. Chairman of the Board. Following the election of the Board of Directors at each annual meeting, the elected Board shall appoint one of its members as Chairman. The Chairman of the Board shall preside at all meetings of the Board of Directors and of the stockholders, and he shall perform such other duties and have such other powers as from time to time may be prescribed by the Board of Directors.
Section 2.02. Lead Independent Director. Following the election of the Board of Directors at each annual meeting, the elected Board may appoint one of its independent members as its Lead Independent Director. When the Chairman of the Board is not present at a meeting of the Board of Directors, the Lead Independent Director, if there be one, shall preside.
Section 2.03. Director Emeritus. The Board of Directors may from time to time elect one or more Directors Emeritus. Each Director Emeritus shall be elected for a term expiring on the date of the regular meeting of the Board of Directors following the next annual meeting. No Director Emeritus shall be considered a “director” for purposes of these By-Laws or for any other purpose.
Section 2.04. Powers, Number, Quorum, Term, Vacancies, Removal. The business and affairs of the Company shall be managed by or under the direction of the Board of Directors which may exercise all such powers of the Company and do all such lawful acts and things as are not by statute or by the Company’s Organization Certificate or by these By-Laws required to be exercised or done by the stockholders.
The number of directors may be changed by a resolution passed by a majority of the members of the Board of Directors or by a vote of the holders of record of at least a majority of the shares of stock of the Company issued and outstanding and entitled to vote, but at all times the Board of Directors must consist of not less than seven nor more than thirty directors. No more than one-third of the directors shall be active officers or employees of the Company. At least one-half of the directors must be citizens of the United States at the time of their election and during their continuance in office.
Except as otherwise required by law, rule or regulation, or by the Company’s Organization Certificate, at all meetings of the Board of Directors or any committee thereof, a majority of the entire Board of Directors or a majority of the directors constituting such committee, as the case may be, shall constitute a quorum for the transaction of business and the act of a majority of the directors or committee members present at any meeting at which there is a quorum shall be the act of the Board of Directors, or such committee, as applicable. Any one or more members of the Board may participate in a meeting of the Board by means of a conference telephone or video, or other similar communications equipment allowing all persons participating in the meeting to hear each other at the same time. Participation by such means shall constitute presence in person at a meeting. Whether or not a quorum shall be present at any meeting of the Board of Directors or a committee thereof, a majority of the directors present thereat may adjourn the meeting from time to time; notice of the adjourned meeting shall be given to the directors who were not present at the time of the adjournment, but if the time and place of the adjourned meeting are announced, no additional notice shall be required to be given to the directors present at the time of adjournment.
Directors shall hold office until the next annual election and until their successors shall have been elected and shall have qualified. Director vacancies not exceeding one-third of the whole number of the Board of Directors may be filled by the affirmative vote of a majority of the directors then in office, and the directors so elected shall hold office for the balance of the unexpired term.
Any one or more of the directors of the Company may be removed either with or without cause at any time by a vote of the holders of record of at least a majority of the shares of stock of the Company, issued and outstanding and entitled to vote, and thereupon the term of the director or directors who shall have been so removed shall forthwith terminate and there shall be a vacancy or vacancies in the Board of Directors, to be filled by a vote of the stockholders as provided in these By-Laws.
Section 2.05. Meetings, Notice. Meetings of the Board of Directors shall be held at such place either within or without the State of New York, as may from time to time be fixed by resolution of the Board, or as may be specified in the call or in a waiver of notice thereof. Regular meetings of the Board of Directors and its Executive Committee shall be held as often as may be required under applicable law, and special meetings may be held at any time upon the call of two directors, the Chairman of the Board or the President, by oral, telegraphic or written notice duly served on or sent or mailed to each director not less than two days before such meeting. Any meeting may be held without notice, if all directors are present, or if notice is waived in writing, either before or after the meeting, by those not present.
Section 2.06. Compensation. The Board of Directors may determine, from time to time, the amount of compensation, which shall be paid to its members. The Board of Directors shall also have power, in its discretion, to allow a fixed sum and expenses for attendance at each regular or special meeting of the Board, or of any committee of the Board. The Board of Directors shall also have power, in its discretion, to provide for and pay to directors rendering services to the Company not ordinarily rendered by directors, as such, special compensation appropriate to the value of such services, as determined by the Board from time to time.
ARTICLE III
COMMITTEES
Section 3.01. Executive Committee. There shall be an Executive Committee of the Board who shall be appointed annually by resolution adopted by the majority of the entire Board of Directors. The Chairman of the Board shall preside at meetings of the Executive Committee. In his
absence, the Chief Executive Officer or, in his absence, the President or any Co-President or, in their absence, such other member of the Executive Committee as the Executive Committee from time to time may designate shall preside at such meetings.
Section 3.02. Audit and Fiduciary Committee. There shall be an Audit and Fiduciary Committee appointed annually by resolution adopted by a majority of the entire Board of Directors which shall consist of such number of independent directors, as may from time to time be fixed by the Audit and Fiduciary Committee charter adopted by the Board of Directors.
Section 3.03. Other Committees. The Board of Directors shall have the power to appoint any other Committees as may seem necessary, and from time to time to suspend or continue the powers and duties of such Committees. Each Committee appointed pursuant to this Article shall serve at the pleasure of the Board of Directors.
Section 3.04. Limitations. No committee shall have the authority as to the following matters: (i) the submission to stockholders of any action that needs stockholders’ authorization under New York Banking Law; (ii) the filling of vacancies in the Board of Directors or in any such committee; (iii) the fixing of compensation of the directors for serving on the Board of Directors or on any committee; (iv) the amendment or repeal of these By-Laws, or the adoption of new by-laws; (v) the amendment or repeal of any resolution of the Board of Directors which by its terms shall not be so amendable or repealable; or (vi) the taking of action which is expressly required by any provision of New York Banking Law to be taken at a meeting of the Board of Directors or by a specified proportion of the directors.
ARTICLE IV
OFFICERS
Section 4.01. Titles and Election. The officers of the Company, who shall be chosen by the Board of Directors within twenty-five days after each annual meeting of stockholders, shall be a President, Chief Executive Officer, Chief Risk Officer, Chief Financial Officer, Treasurer, Secretary, and a General Auditor. The Board of Directors from time to time may elect one or more Managing Directors, Directors, Vice Presidents, Assistant Secretaries, Assistant Treasurers and such other officers and agents as it shall deem necessary, and may define their powers and duties. Any number of offices may be held by the same person, except the offices of President and Secretary.
Section 4.02. Terms of Office. Each officer shall hold office for the term for which he is elected or appointed, and until his successor has been elected or appointed and qualified.
Section 4.03. Removal. Any officer may be removed, either with or without cause, at any time, by the affirmative vote of a majority of the Board of Directors.
Section 4.04. Resignations. Any officer may resign at any time by giving written notice to the Board of Directors or to the Secretary. Such resignation shall take effect at the time specified therein and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.
Section 4.05. Vacancies. If the office of any officer or agent becomes vacant by reason of death, resignation, retirement, disqualification, removal from office or otherwise, the Board of Directors may choose a successor, who shall hold office for the unexpired term in respect of which such vacancy occurred.
Section 4.06. President. The President shall have general authority to exercise all the powers necessary for the President of the Company. In the absence of the Chairman and the Lead Independent Director, the President shall preside at all meetings of the Board of Directors and of the stockholders. The President shall have the power to execute bonds, mortgages and other contracts, agreements and instruments of the Company, and he shall perform such other duties and have such other powers as may be incident to the office of the president of a corporation and as from time to time may otherwise be prescribed by the Board of Directors.
Section 4.07. Chief Executive Officer. Unless otherwise determined by the Board of Directors, the President shall be the Chief Executive Officer of the Company. The Chief Executive Officer shall exercise the powers and perform the duties usual to the chief executive officer and, subject to the control of the Board of Directors, shall have general management and control of the affairs and business of the Company; he shall appoint and discharge employees and agents of the Company (other than officers elected by the Board of Directors); he shall see that all orders and resolutions of the Board of Directors are carried into effect; he shall have the power to execute bonds, mortgages and other contracts, agreements and instruments of the Company, and he shall perform such other duties and have such other powers as may be incident to the office of the chief executive officer of a corporation and as from time to time may otherwise be prescribed by the Board of Directors.
Section 4.08. Chief Risk Officer. The Chief Risk Officer shall have the responsibility for the risk management and monitoring of the Company. The Chief Risk Officer shall have the power to execute bonds, notes, mortgages and other contracts, agreements and instruments of the Company, and he shall perform such other duties and have such other powers as may be incident to his office and as from time to time may otherwise be prescribed by the Board of Directors.
Section 4.09. Chief Financial Officer. The Chief Financial Officer shall have the responsibility for reporting to the Board of Directors on the financial condition of the Company, preparing and submitting all financial reports required by applicable law, and preparing annual financial statements of the Company and coordinating with qualified third party auditors to ensure such financial statements are audited in accordance with applicable law.
Section 4.10. Treasurer. The Treasurer shall have the custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the Company and shall deposit all moneys, and other valuable effects in the name and to the credit of the Company, in such depositories as may be designated by the Board of Directors. He shall disburse the funds of the Company as may be ordered by the Board, taking proper vouchers for such disbursements, and shall render to the directors whenever they may require it an account of all his transactions as Treasurer and of the financial condition of the Company.
Section 4.11. Secretary. The Secretary shall attend all sessions of the Board of Directors and all meetings of the stockholders and record all votes and the minutes of proceedings in records or books to be kept for that purpose. He shall give, or cause to be given, notice of all meetings of the stockholders and of the Board of Directors and shall perform such other duties and have such other powers as may be incident to the office of the secretary of a corporation and as from time to time may otherwise be prescribed by the Board of Directors. The Secretary shall have and be the custodian of the stock records and all other books, records and papers of the Company (other than financial) and shall see that all books, reports, statements, certificates and other documents and records required by law are properly kept and filed.
Section 4.12. General Auditor. The General Auditor shall be responsible, through the Audit and Fiduciary Committee, to the Board of Directors for the determination of the program of the
internal audit function and the evaluation of the adequacy of the system of internal controls. Subject to the Board of Directors, the General Auditor shall have and may exercise all the powers and shall perform all the duties usual to such office and shall have such other powers as may be prescribed or assigned to him from time to time by the Board of Directors or vested in him by law or by these By-Laws. He shall perform such other duties and shall make such investigations, examinations and reports as may be prescribed or required by the Audit and Fiduciary Committee. The General Auditor shall have unrestricted access to all records and premises of the Company and shall delegate such authority to his subordinates. He shall have the duty to report to the Audit and Fiduciary Committee on all matters concerning the internal audit program and the adequacy of the system of internal controls of the Company which he deems advisable or which the Audit and Fiduciary Committee may request.
Section 4.13. Managing Directors, Directors and Vice Presidents. If chosen, the Managing Directors, Directors and Vice Presidents, in the order of their seniority, shall, in the absence or disability of the President, exercise all of the powers and duties of the President. Such Managing Directors, Directors and Vice Presidents shall have the power to execute bonds, notes, mortgages and other contracts, agreements and instruments of the Company, and they shall perform such other duties and have such other powers as may be incident to their respective offices and as from time to time may be prescribed by the Board of Directors or the President.
Section 4.14. Duties of Officers may be Delegated. In case of the absence or disability of any officer of the Company, or for any other reason that the Board may deem sufficient, the Board may delegate, for the time being, the powers or duties, or any of them, of such officer to any other officer.
ARTICLE V
INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHERS
Section 5.01. Power to Indemnify in Actions, Suits or Proceedings other than Those by or in the Right of the Company. Subject to the other provisions of this Article V, and subject to applicable law, the Company shall indemnify any person made or threatened to be made a party to an action or proceeding (other than one by or in the right of the Company to procure a judgment in its favor), whether civil or criminal, including an action by or in the right of any other corporation of any type or kind, domestic or foreign, or any partnership, joint venture, trust, employee benefit plan or other enterprise, which any director or officer of the Company served in any capacity at the request of the Company, by reason of the fact that such person, his or her testator or intestate, was a director or officer of the Company, or served such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise in any capacity, against judgments, fines, amounts paid in settlement and reasonable expenses, including attorneys’ fees actually and necessarily incurred as a result of such action or proceeding, or any appeal therein, if such director or officer acted, in good faith, for a purpose which such person reasonably believed to be in, or, in the case of service for any other corporation or any partnership, joint venture, trust, employee benefit plan or other enterprise, not opposed to, the best interests of the Company, and had no reasonable cause to believe that such person’s conduct was unlawful.
Section 5.02. Power to Indemnify in Actions, Suits or Proceedings by or in the Right of the Company. Subject to the other provisions of this Article V, and subject to applicable law, the Company shall indemnify any person made, or threatened to be made, a party to an action by or in the right of the Company to procure a judgment in its favor by reason of the fact that such person, his or her testator or intestate, is or was a director or officer of the Company, or is or was serving at the request of the Company as a director or officer of any other corporation of any type or kind, domestic or foreign, of any partnership, joint venture, trust, employee benefit plan or other enterprise,
against amounts paid in settlement and reasonable expenses, including attorneys’ fees, actually and necessarily incurred by such person in connection with the defense or settlement of such action, or in connection with an appeal therein, if such director or officer acted, in good faith, for a purpose which he reasonably believed to be in, or, in the case of service for any other corporation or any partnership, joint venture, trust, employee benefit plan or other enterprise, not opposed to, the best interests of the Company, except that no indemnification under this Section 5.02 shall be made in respect of (a) a threatened action, or a pending action which is settled or otherwise disposed of, or (b) any claim, issue or matter as to which such person shall have been adjudged to be liable to the Company, unless and only to the extent that the court in which the action was brought, or, if no action was brought, any court of competent jurisdiction, determines upon application that, in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for such portion of the settlement amount and expenses as the court deems proper.
Section 5.03. Authorization of Indemnification. Any indemnification under this Article V (unless ordered by a court) shall be made by the Company only if authorized in the specific case (i) by the Board acting by a quorum consisting of directors who are not parties to such action or proceeding upon a finding that the director or officer has met the standard of conduct set forth in Section 5.01 or Section 5.02, as the case may be; or (ii) if a quorum is not obtainable or, even if obtainable, a quorum of disinterested directors so directs, (x) by the Board upon the opinion in writing of independent legal counsel that indemnification is proper in the circumstances because the applicable standard of conduct set forth in Section 5.01 or Section 5.02, as the case may be, has been met by such director or officer; or (y) by the stockholders upon a finding that the director or officer has met the applicable standard of conduct set forth in Section 5.01 or Section 5.02, as the case may be. A person who has been successful on the merits or otherwise, in the defense of a civil or criminal action or proceeding of the character described in Sections 5.01 or 5.02, shall be entitled to indemnification as authorized in such section.
Section 5.04. Good Faith Defined. For purposes of any determination under Section 5.03, a person shall be deemed to have acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Company, or to have had no reasonable cause to believe such person’s conduct was unlawful, if such person’s action is based on the records or books of account of the Company or another enterprise, or on information supplied to such person by the officers of the Company or another enterprise in the course of their duties, or on the advice of legal counsel for the Company or another enterprise or on information or records given or reports made to the Company or another enterprise by an independent certified public accountant or by an appraiser or other expert selected with reasonable care by the Company or another enterprise. The provisions of this Section 5.04 shall not be deemed to be exclusive or to limit in any way the circumstances in which a person may be deemed to have met the applicable standard of conduct set forth in Section 5.01 or Section 5.02, as the case may be.
Section 5.05. Serving an Employee Benefit Plan on behalf of the Company. For the purpose of this Article V, the Company shall be deemed to have requested a person to serve an employee benefit plan where the performance by such person of his duties to the Company also imposes duties on, or otherwise involves services by, such person to the plan or participants or beneficiaries of the plan; excise taxes assessed on a person with respect to an employee benefit plan pursuant to applicable law shall be considered fines; and action taken or omitted by a person with respect to an employee benefit plan in the performance of such person’s duties for a purpose reasonably believed by such person to be in the interest of the participants and beneficiaries of the plan shall be deemed to be for a purpose which is not opposed to the best interests of the Company.
Section 5.06. Indemnification upon Application to a Court. Notwithstanding the failure of the Company to provide indemnification and despite any contrary resolution of the Board or stockholders under Section 5.03, or in the event that no determination has been made within ninety
days after receipt of the Company of a written claim therefor, upon application to a court by a director or officer, indemnification shall be awarded by a court to the extent authorized in Section 5.01 or Section 5.02. Such application shall be upon notice to the Company. Neither a contrary determination in the specific case under Section 5.03 nor the absence of any determination thereunder shall be a defense to such application or create a presumption that the director or officer seeking indemnification has not met any applicable standard of conduct.
Section 5.07. Expenses Payable in Advance. Subject to the other provisions of this Article V, and subject to applicable law, expenses incurred in defending a civil or criminal action or proceeding may be paid by the Company in advance of the final disposition of such action or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount (i) if it shall ultimately be determined that such person is not entitled to be indemnified by the Company as authorized in this Article V, (ii) where indemnification is granted, to the extent expenses so advanced by the Company or allowed by a court exceed the indemnification to which such person is entitled and (iii) upon such other terms and conditions, if any, as the Company deems appropriate. Any such advancement of expenses shall be made in the sole and absolute discretion of the Company only as authorized in the specific case upon a determination made, with respect to a person who is a director or officer at the time of such determination, (i) by the Board acting by a quorum consisting of directors who are not parties to such action or proceeding, or (ii) if a quorum is not obtainable or, even if obtainable, if a quorum of disinterested directors so directs, (x) by the Board upon the opinion in writing of independent legal counsel or (y) by the stockholders and, with respect to former directors and officers, by any person or persons having the authority to act on the matter on behalf of the Company. Without limiting the foregoing, the Company reserves the right in its sole and absolute discretion to revoke at any time any approval previously granted in respect of any such request for the advancement of expenses or to, in its sole and absolute discretion, impose limits or conditions in respect of any such approval.
Section 5.08. Nonexclusivity of Indemnification and Advancement of Expenses. The indemnification and advancement of expenses granted pursuant to, or provided by, this Article V shall not be deemed exclusive of any other rights to which a director or officer seeking indemnification or advancement of expenses may be entitled whether contained in the Company’s Organization Certificate, these By-Laws or, when authorized by the Organization Certificate or these By-Laws, (i) a resolution of stockholders, (ii) a resolution of directors, or (iii) an agreement providing for such indemnification, provided that no indemnification may be made to or on behalf of any director or officer if a judgment or other final adjudication adverse to the director or officer establishes that his acts were committed in bad faith or were the result of active and deliberate dishonesty and were material to the cause of action so adjudicated, or that he personally gained in fact a financial profit or other advantage to which he was not legally entitled. Nothing contained in this Article V shall affect any rights to indemnification to which corporate personnel other than directors and officers may be entitled by contract or otherwise under law.
Section 5.09. Insurance. Subject to the other provisions of this Article V, the Company may purchase and maintain insurance (in a single contract or supplement thereto, but not in a retrospective rated contract): (i) to indemnify the Company for any obligation which it incurs as a result of the indemnification of directors and officers under the provisions of this Article V, (ii) to indemnify directors and officers in instances in which they may be indemnified by the Company under the provisions of this Article V and applicable law, and (iii) to indemnify directors and officers in instances in which they may not otherwise be indemnified by the Company under the provisions of this Article V, provided the contract of insurance covering such directors and officers provides, in a manner acceptable to the New York Superintendent of Financial Services, for a retention amount and for co-insurance. Notwithstanding the foregoing, any such insurance shall be subject to the provisions of, and the Company shall comply with the requirements set forth in, Section 7023 of the New York State Banking Law.
Section 5.10. Limitations on Indemnification and Insurance. All indemnification and insurance provisions contained in this Article V are subject to any limitations and prohibitions under applicable law, including but not limited to Section 7022 (with respect to indemnification, advancement or allowance) and Section 7023 (with respect to insurance) of the New York State Banking Law and the Federal Deposit Insurance Act (with respect to administrative proceedings or civil actions initiated by any federal banking agency). Notwithstanding anything contained in this Article V to the contrary, no indemnification, advancement or allowance shall be made (i) to or on behalf of any director or officer if a judgment or other final adjudication adverse to the director or officer establishes that his acts were committed in bad faith or were the result of active and deliberate dishonesty and were material to the cause of action so adjudicated, or that he personally gained in fact a financial profit or other advantage to which he was not legally entitled, or (ii) in any circumstance where it appears (a) that the indemnification would be inconsistent with a provision of the Company’s Organization Certificate, these By-Laws, a resolution of the Board or of the stockholders, an agreement or other proper corporate action, in effect at the time of the accrual of the alleged cause of action asserted in the threatened or pending action or proceeding in which the expenses were incurred or other amounts were paid, which prohibits or otherwise limits indemnification; or (b) if there has been a settlement approved by the court, that the indemnification would be inconsistent with any condition with respect to indemnification expressly imposed by the court in approving the settlement.
Notwithstanding anything contained in this Article V to the contrary, but subject to any requirements of applicable law, (i) except for proceedings to enforce rights to indemnification (which shall be governed by Section 5.06), the Company shall not be obligated to indemnify any director or officer (or his testators intestate) or advance expenses in connection with a proceeding (or part thereof) initiated by such person unless such proceeding (or part thereof) was authorized or consented to by the Board of Directors of the Company, (ii) with respect to indemnification or advancement of expenses relating to attorneys’ fees under this Article V, counsel for the present or former director or officer must be reasonably acceptable to the Company (and the Company may, in its sole and absolute discretion, establish a panel of approved law firms for such purpose, out of which the present or former director or officer could be required to select an approved law firm to represent him), (iii) indemnification in respect of amounts paid in settlement shall be subject to the prior consent of the Company (not to be unreasonably withheld), (iv) any and all obligations of the Corporation under this Article V shall be subject to applicable law, (v) in no event shall any payments pursuant to this Article V be made if duplicative of any indemnification or advancement of expenses or other reimbursement available to the applicable director or officer (other than for coverage maintained by such person in his individual capacity), and (vi) no indemnification or advancement of expenses shall be provided under these By-Laws to any person in respect of any expenses, judgments, fines or amounts paid in settlement to the extent incurred by such person in his capacity or position with another entity (including, without limitation, an entity that is a stockholder of the Company or any of the branches or affiliates of such stockholder), except as expressly provided in these By-Laws in respect of such person’s capacity and position as a director or officer of the Company or such person is a director or officer of the Company serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise.
Section 5.11. Indemnification of Other Persons. The Company may, to the extent authorized from time to time by the Board of Directors, provide rights to indemnification and to the advancement of expenses (whether pursuant to an adoption of a policy or otherwise) to employees and agents of the Company (whether similar to those conferred in this Article V upon directors and officers of the Company or on other terms and conditions authorized from time to time by the Board of Directors), as well as to employees of direct and indirect subsidiaries of the Company and to other persons (or categories of persons) approved from time to time by the Board of Directors.
Section 5.12. Repeal. Any repeal or modification of this Article V shall not adversely affect any rights to indemnification and to the advancement of expenses of a director, officer, employee or agent of the Company existing at the time of such repeal or modification with respect to any acts or omissions occurring prior to such repeal or modification.
ARTICLE VI
CAPITAL STOCK
Section 6.01. Certificates. The interest of each stockholder of the Company shall be evidenced by certificates for shares of stock in such form as the Board of Directors may from time to time prescribe. The certificates of stock shall be signed by the Chairman of the Board or the President or a Managing Director or a Director or a Vice President and by the Secretary, or the Treasurer, or an Assistant Secretary, or an Assistant Treasurer, sealed with the seal of the Company or a facsimile thereof, and countersigned and registered in such manner, if any, as the Board of Directors may by resolution prescribe. Where any such certificate is countersigned by a transfer agent other than the Company or its employee, or registered by a registrar other than the Company or its employee, the signature of any such officer may be a facsimile signature. In case any officer or officers who shall have signed, or whose facsimile signature or signatures shall have been used on, any such certificate or certificates shall cease to be such officer or officers of the Company, whether because of death, resignation, retirement, disqualification, removal or otherwise, before such certificate or certificates shall have been delivered by the Company, such certificate or certificates may nevertheless be adopted by the Company and be issued and delivered as though the person or persons who signed such certificate or certificates or whose facsimile signature or signatures shall have been used thereon had not ceased to be such officer or officers of the Company.
Section 6.02. Transfer. The shares of stock of the Company shall be transferred only upon the books of the Company by the holder thereof in person or by his attorney, upon surrender for cancellation of certificates for the same number of shares, with an assignment and power of transfer endorsed thereon or attached thereto, duly executed, with such proof of the authenticity of the signature as the Company or its agents may reasonably require.
Section 6.03. Record Dates. The Board of Directors may fix in advance a date, not less than 10 nor more than 50 days preceding the date of any meeting of stockholders, or the date for the payment of any dividend, or the date for the distribution or allotment of any rights, or the date when any change, conversion or exchange of capital stock shall go into effect, as a record date for the determination of the stockholders entitled to notice of, and to vote at, any such meeting, or entitled to receive payment of any such dividend, or to receive any distribution or allotment of such rights, or to exercise the rights in respect of any such change, conversion or exchange of capital stock, and in such case only such stockholders as shall be stockholders of record on the date so fixed shall be entitled to such notice of, and to vote at, such meeting, or to receive payment of such dividend, or to receive such distribution or allotment or rights or to exercise such rights, as the case may be, notwithstanding any transfer of any stock on the books of the Company after any such record date fixed as aforesaid.
Section 6.04. Lost Certificates. In the event that any certificate of stock is lost, stolen, destroyed or mutilated, the Board of Directors may authorize the issuance of a new certificate of the same tenor and for the same number of shares in lieu thereof. The Board may in its discretion, before the issuance of such new certificate, require the owner of the lost, stolen, destroyed or mutilated certificate or the legal representative of the owner to make an affidavit or affirmation setting forth such facts as to the loss, destruction or mutilation as it deems necessary and to give the Company a bond in such reasonable sum as it directs to indemnify the Company.
ARTICLE VII
CHECKS, NOTES, ETC.
Section 7.01. Checks, Notes, Etc. All checks and drafts on the Company’s bank accounts and all bills of exchange and promissory notes, and all acceptances, obligations and other instruments for the payment of money, may be signed by the President or any Managing Director or any Director or any Vice President and may also be signed by such other officer or officers, agent or agents, as shall be thereunto authorized from time to time by the Board of Directors.
ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.01. Fiscal Year. The fiscal year of the Company shall be from January 1 to December 31, unless changed by the Board of Directors.
Section 8.02. Books. There shall be kept at such office of the Company as the Board of Directors shall determine, within or without the State of New York, correct books and records of account of all its business and transactions, minutes of the proceedings of its stockholders, Board of Directors and committees, and the stock book, containing the names and addresses of the stockholders, the number of shares held by them, respectively, and the dates when they respectively became the owners of record thereof, and in which the transfer of stock shall be registered, and such other books and records as the Board of Directors may from time to time determine.
Section 8.03. Voting of Stock. Unless otherwise specifically authorized by the Board of Directors, all stock owned by the Company, other than stock of the Company, shall be voted, in person or by proxy, by the President or any Managing Director or any Director or any Vice President of the Company on behalf of the Company.
ARTICLE IX
AMENDMENTS
Section 9.01. Amendments. The vote of the holders of at least a majority of the shares of stock of the Company issued and outstanding and entitled to vote shall be necessary at any meeting of stockholders to amend or repeal these By-Laws or to adopt new by-laws. These By-Laws may also be amended or repealed, or new by-laws adopted, at any meeting of the Board of Directors by the vote of at least a majority of the entire Board, provided that any by-law adopted by the Board may be amended or repealed by the stockholders in the manner set forth above.
Any proposal to amend or repeal these By-Laws or to adopt new by-laws shall be stated in the notice of the meeting of the Board of Directors or the stockholders or in the waiver of notice thereof, as the case may be, unless all of the directors or the holders of record of all of the shares of stock of the Company issued and outstanding and entitled to vote are present at such meeting.
Exhibit 7
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Federal Financial Institutions Examination Council |
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Consolidated Reports of Condition and Income for A Bank With Domestic Offices Only - FFIEC 041 |
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Report at the close of business September 30, 2019
This report is required by law: 12 U.S.C. §324 (State member banks); 12 U.S.C. §1817 (State non member banks); 12 U.S.C. §161 (National banks); and 12 U.S.C. §1464 (Savings associations). |
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(20190930) (RCON 9999)
Unless the context indicates otherwise, the term “bank” in this report form refers to both banks and savings associations.
This report form is to be filed by banks with branches and consolidated subsidiaries in U.S. territories and possessions, Edge or Agreement subsidiaries, foreign branches, consolidated foreign subsidiaries, or International Banking Facilities. | |
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NOTE: Each bank’s board of directors and senior management are responsible for establishing and maintaining an effective system of internal control, including controls over the Reports of Condition and Income. The Reports of Condition and Income are to be prepared in accordance with federal regulatory authority instructions.The Reports of Condition and Income must be signed by the Chief Financial Officer (CFO) of the reporting bank (or by the individual performing an equivalent function) and attested to by not less than two directors (trustees) for state non member banks and three directors for state member banks, national banks, and savings associations.
I, the undersigned CFO (or equivalent) of the named bank, attest that the Reports of Condition and Income (including the supporting |
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schedules) for this report date have been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and are true and correct to the best of my knowledge and belief.
We, the undersigned directors (trustees), attest to the correctness of the Reports of Condition and Income (including the supporting schedules) for this report date and declare that the Reports of Condition and Income have been examined by us and to the best of our knowledge and belief have been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and are true and correct. | |
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Signature of Chief Financial Officer (or Equivalent) |
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Director (Trustee) | |
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Date of Signature |
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Director (Trustee) | |
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Director (Trustee) | |
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Submission of Reports
Each bank must file its Reports of Condition and Income (Call Report) data by either:
(a) Using computer software to prepare its Call Report and then submitting the report data directly to the FFIEC’s Central Data Repository (CDR), an Internet-based system for datacollection (https://cdr.ffiec.gov/cdr/), or
(b) Completing its Call Report in paper form and arranging with a software vendor or another party to convert the data in to the electronic format that can be processed by the CDR. The software vendor or other party then must electronically submit the bank’s data file to the CDR.
For technical assistance with submissions to the CDR, please contact the CDR Help Desk by telephone at (888) CDR-3111, by fax at (703) 774-3946, or by e-mail at CDR.Help@ffiec.gov. |
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FDIC Certificate Number 623 (RSSD 9050)
To fulfill the signature and attestation requirement for the Reports of Condition and Income for this report date, attach your bank’s completed signature page (or a photocopy or a computer generated version of this page) to the hard-copy record of the data file submitted to the CDR that your bank must place in its files.
The appearance of your bank’s hard-copy record of the submitted data file need not match exactly the appearance of the FFIEC’s sample report forms, but should show at least the caption of each Call Report item and the reported amount.
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DEUTSCHE BANK TRUST COMPANY AMERICAS | ||
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Legal Title of Bank (RSSD 9017) |
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NEW YORK |
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City (RSSD 9130) |
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NY |
10005 | |
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State Abbreviation (RSSD 9200) |
Zip Code (RSSD 9220) | |
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The estimated average burden associated with this information collection is 50.4 hours per respondent and is estimated to vary from 20 to 775 hours per response, depending on individual circumstances. Burden estimates include the time for reviewing instructions, gathering and maintaining data in the required form, and completing the information collection, but exclude the time for compiling and maintaining business records in the normal course of a respondent’s activities. A Federal agency may not conduct or sponsor, and an organization (or a person) is not required to respond to a collection of information, unless it displays a currently valid OMB control number. Comments concerning the accuracy of this burden estimate and suggestions for reducing this burden should be directed to the Office of Information and Regulatory Affairs, Office of Management and Budget, Washington, DC 20503, and to one of the following: Secretary, Board of Governors of the Federal Reserve System, 20th and C Streets, NW, Washington, DC 20551; Legislative and Regulatory Analysis Division, Office of the Comptroller of the Currency, Washington, DC 20219; Assistant Executive Secretary, Federal Deposit Insurance Corporation, Washington, DC 20429.
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DEUTSCHE BANK TRUST COMPANY AMERICAS |
FFIEC 041 |
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RSSD-ID 214807 |
Report Date 9/30/2019 |
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Last Updated on 10/30/2019 |
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Schedule RC - Balance Sheet
All schedules are to be reported in thousands of dollars. Unless otherwise indicated, report the amount outstanding as of the last business day of the quarter.
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Dollar amounts in thousands |
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1. Cash and balances due from depository institutions (from Schedule RC-A): |
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1. |
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a. Noninterest-bearing balances and currency and coin(1) |
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RCON0081 |
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50,000 |
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1.a. |
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b. Interest-bearing balances(2) |
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RCON0071 |
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14,667,000 |
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1.b. |
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2. Securities: |
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2. |
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a. Held-to-maturity securities (from Schedule RC-B, column A)(3) |
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RCONJJ34 |
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0 |
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2.a. |
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b. Available-for-sale securities (from Schedule RC-B, column D) |
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RCON1773 |
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0 |
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2.b. |
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c. Equity securities with readily determinable fair values not held for trading(4) |
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RCONJA22 |
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6,000 |
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2.c. |
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3. Federal funds sold and securities purchased under agreements to resell: |
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3. |
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a. Federal funds sold |
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RCONB987 |
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0 |
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3.a. |
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b. Securities purchased under agreements to resell(5) |
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RCONB989 |
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13,204,000 |
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3.b. |
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4. Loans and lease financing receivables (from Schedule RC-C): |
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4. |
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a. Loans and leases held for sale |
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RCON5369 |
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0 |
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4.a. |
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b. Loans and leases held for investment |
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RCONB528 |
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10,758,000 |
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4.b. |
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c. LESS: Allowance for loan and lease losses |
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RCON3123 |
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9,000 |
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4.c. |
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d. Loans and leases held for investment, net of allowance (item 4.b minus 4.c)(7) |
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RCONB529 |
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10,749,000 |
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4.d. |
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5. Trading assets (from Schedule RC-D) |
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RCON3545 |
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0 |
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5. |
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6. Premises and fixed assets (including capitalized leases) |
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RCON2145 |
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22,000 |
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6. |
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7. Other real estate owned (from Schedule RC-M) |
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RCON2150 |
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2,000 |
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7. |
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8. Investments in unconsolidated subsidiaries and associated companies |
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RCON2130 |
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0 |
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8. |
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9. Direct and indirect investments in real estate ventures |
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RCON3656 |
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0 |
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9. |
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10. Intangible assets (from Schedule RC-M) |
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RCON2143 |
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19,000 |
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10. |
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11. Other assets (from Schedule RC-F)(6) |
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RCON2160 |
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1,553,000 |
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11. |
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12. Total assets (sum of items 1 through 11) |
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RCON2170 |
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40,272,000 |
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12. |
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13. Deposits: |
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13. |
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a. In domestic offices (sum of totals of columns A and C from Schedule RC-E) |
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RCON2200 |
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27,156,000 |
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13.a. |
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1. Noninterest-bearing(8) |
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RCON6631 |
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10,807,000 |
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13.a.1. |
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2. Interest-bearing |
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RCON6636 |
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16,349,000 |
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13.a.2. |
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b. Not applicable |
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13.b. |
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14. Federal funds purchased and securities sold under agreements to repurchase: |
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14. |
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a. Federal funds purchased(9) |
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RCONB993 |
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1,295,000 |
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14.a. |
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b. Securities sold under agreements to repurchase(10) |
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RCONB995 |
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0 |
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14.b. |
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15. Trading liabilities (from Schedule RC-D) |
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RCON3548 |
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0 |
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16. Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases) (from Schedule RC-M) |
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RCON3190 |
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371,000 |
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16. |
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17. Not applicable |
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17. |
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18. Not applicable |
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18. |
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19. Subordinated notes and debentures(8) |
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RCON3200 |
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0 |
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19. |
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20. Other liabilities (from Schedule RC-G) |
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RCON2930 |
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1,937,000 |
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20. |
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
(3) Institutions that have adopted ASU 2016-13 should report in item 2.a, amounts net of any applicable allowance for credit losses, and should equal to Schedule RC-B, item 8, column A less Schedule RI-B, Part II, item 7, column B.
(4) Item 2.c is to be completed only by institutions that have adopted ASU 2016-01, which includes provisions governing the accounting for investments in equity securities. See the instructions for further detail on ASU 2016-01.
(5) Includes all securities resale agreements, regardless of maturity.
(7) Institutions that have adopted ASU 2016-13 should report in item 4.c the allowance for credit losses on loans and leases.
(6) Institutions that have adopted ASU 2016-13 should report in items 3.b and 11 amounts net of any applicable allowance for credit losses.
(8) Includes noninterest-bearing demand, time, and savings deposits.
(9) Report overnight Federal Home Loan Bank advances in Schedule RC, item 16, “Other borrowed money.”
(10) Includes all securities repurchase agreements, regardless of maturity.
(8) Includes limited-life preferred stock and related surplus.
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DEUTSCHE BANK TRUST COMPANY AMERICAS |
FFIEC 041 |
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RSSD-ID 214807 |
Report Date 9/30/2019 |
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Last Updated on 10/30/2019 |
14 |
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Dollar amounts in thousands |
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21. Total liabilities (sum of items 13 through 20) |
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RCON2948 |
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30,759,000 |
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21. |
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22. Not applicable |
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22. |
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23. Perpetual preferred stock and related surplus |
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RCON3838 |
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0 |
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23. |
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24. Common stock |
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RCON3230 |
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2,127,000 |
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24. |
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25. Surplus (exclude all surplus related to preferred stock) |
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RCON3839 |
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904,000 |
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25. |
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26. Not available |
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26. |
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a. Retained earnings |
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RCON3632 |
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6,483,000 |
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26.a. |
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b. Accumulated other comprehensive income(1) |
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RCONB530 |
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-1,000 |
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26.b. |
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c. Other equity capital components(2) |
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RCONA130 |
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0 |
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26.c. |
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27. Not available |
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27. |
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a. Total bank equity capital (sum of items 23 through 26.c) |
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RCON3210 |
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9,513,000 |
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27.a. |
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b. Noncontrolling (minority) interests in consolidated subsidiaries |
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RCON3000 |
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0 |
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27.b. |
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28. Total equity capital (sum of items 27.a and 27.b) |
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RCONG105 |
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9,513,000 |
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28. |
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29. Total liabilities and equity capital (sum of items 21 and 28) |
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RCON3300 |
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40,272,000 |
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29. |
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1. Indicate in the box at the right the number of the statement below that best describes the most comprehensive level of auditing work performed for the bank by independent external auditors as of any date during 2018 |
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RCON6724 |
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NR |
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M.1. |
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2. Bank’s fiscal year-end date (report the date in MMDD format) |
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RCON8678 |
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NR |
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M.2. |
(1) Includes, but is not limited to, net unrealized holding gains (losses) on available-for-sale securities, accumulated net gains (losses) on cash flow hedges, and accumulated defined benefit pension and other postretirement plan adjustments.
(2) Includes treasury stock and unearned Employee Stock Ownership Plan shares.