Registration Statement No. 333-196235


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NameRegistration Statement No. 333-196235
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Risks Related to the Proposed CAS Acquisition

 

There can be no assurance that the CAS Acquisition will be completed.

 

On April 16, 2014, we signed a definitive agreement to acquire CAS in a stock and cash transaction.  We expect the CAS Acquisition to close in the second half of 2014, subject to customary closing conditions.  There can be no assurance that the acquisition will be completed.

 

There are a number of risks and uncertainties relating to the CAS Acquisition.  For example, the CAS Acquisition may not be completed, or may not be completed in the time frame, on the terms or in the manner currently anticipated, as a result of a number of factors, including, among other things, the failure of one or more of the conditions to closing.  There can be no assurance that the conditions to closing of the CAS Acquisition will be satisfied or waived or that other events will not intervene to delay or result in the failure to close the CAS Acquisition.  The stock and asset purchase agreement between us and Chemtura may be terminated by the parties thereto under certain circumstances, including, without limitation, if the CAS Acquisition has not been completed by November 1, 2014.  Any delay in closing or a failure to close could have a negative impact on our business and the trading price of our common stock.  In addition, if we fail to consummate the closing of the CAS Acquisition within one business day following the date the closing was required to be consummated pursuant to the terms of the stock and asset purchase agreement, solely as a result of the failure of our anticipated debt financing to be consummated (other than if such failure is a result of our breach of the stock and asset purchase agreement or the debt commitment letter we obtained in connection with the stock and asset purchase agreement), we will be obligated to pay Chemtura a cash termination fee of $49.7 million.

 

The due diligence undertaken in connection with the CAS Acquisition may not have revealed all relevant considerations or liabilities of CAS, which could have a material adverse effect on our financial condition or results of operations.

 

There can be no assurance that the due diligence undertaken by us in connection with the CAS Acquisition has revealed all relevant facts that may be necessary to evaluate such acquisition.  Furthermore, the information provided during due diligence may have been incomplete, inadequate or inaccurate.  As part of the due diligence process, we have also made subjective judgments regarding the results of operations, financial condition and prospects of CAS.  If the due diligence investigation has failed to correctly identify material issues and liabilities that may be present in CAS, or if we consider any identified material risks to be commercially acceptable relative to the opportunity, we may incur substantial impairment charges or other losses following the CAS Acquisition.  In addition, we may be subject to significant, previously undisclosed liabilities of CAS that were not identified during due diligence and which could contribute to poor operational performance and have a material adverse effect on our financial condition or results of operations.

 

We may fail to realize the growth prospects and other benefits anticipated from the CAS Acquisition.

 

The success of the CAS Acquisition will depend, in part, on our ability to realize the anticipated business opportunities and growth prospects from the CAS Acquisition.  We may never realize these business opportunities and growth prospects.  The CAS Acquisition and related integration will require significant efforts and expenditures.  Our management might have its attention diverted while trying to integrate operations and corporate and administrative infrastructures and the cost of integration may exceed our expectations.  We may also be required to make unanticipated capital expenditures or investments in order to maintain, improve or sustain the acquired operations or take writeoffs or impairment charges and may be subject to unanticipated or unknown liabilities relating to the CAS Acquisition.  If any of these factors limit our ability to complete the CAS Acquisition and integration of operations successfully or on a timely basis, our expectations of future results of operations following the CAS Acquisition might not be met.

 

In addition, it is possible that the integration process could result in the loss of key employees, the disruption of ongoing businesses, tax costs or inefficiencies, or inconsistencies in standards, controls, information technology

 

 

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systems, procedures and policies, any of which could adversely affect our ability to achieve the anticipated benefits of the CAS Acquisition and could harm our financial performance.

 

Our and CAS’ business relationships, including customer relationships, may be subject to disruption due to uncertainty associated with the CAS Acquisition.

 

Parties with which we or CAS do business may experience uncertainty associated with the CAS Acquisition, including with respect to current or future business relationships with us, CAS or the combined business.  These business relationships may be subject to disruption as customers and others may attempt to negotiate changes in existing business relationships or consider entering into business relationships with parties other than us, CAS or the combined business, including our competitors or those of CAS.  These disruptions could have a material adverse effect on the sales, operating results and financial condition of the combined business.  The adverse effect of such disruptions could be exacerbated by a delay in the completion of the CAS Acquisition or termination of the stock and asset purchase agreement between us and Chemtura.

 

Risks Relating to Ownership of our Common Stock

 

We have numerous equity instruments outstanding that would require us to issue additional shares of common stock.  Therefore, you may experience significant dilution of your ownership interests and the future issuance of additional shares of our common stock, or the anticipation of such issuances, could have an adverse effect on our stock price.

 

We currently have numerous equity instruments outstanding that would require us to issue additional shares of common stock for no or a fixed amount of additional consideration.  Specifically, as of June 1, 2014, we had outstanding the following:

 

 

·

2,000,000 shares of Series A preferred stock (the “Series A Preferred Stock”) held by Mariposa Acquisition, LLC and Berggruen Acquisition Holdings, IV, Ltd. (collectively, the “Founder Entities”) which are convertible into shares of our common stock, on a one-for-one basis, at any time at the option of the Founder Entities;

 

 

·

8,905,776 exchange rights which will require us to issue shares of our common stock for shares of Platform Delaware Holdings, Inc. common stock at the option of the holder, on a one-for-one basis, at 25% per year after the earlier of October 31, 2014 or a change of control of Platform;

 

 

·

250,000 options which are exercisable to purchase share of our common stock, on a one-for-one basis, at any time at the option of the holder; and

 

 

·

353,650 shares of common stock, which were issued to certain of our employees, pursuant to purchase rights under our Platform Specialty Products Corporation 2013 Incentive Compensation Plan.

 

We also have 15,146,350 shares of common stock currently available under our Platform Specialty Products Corporation Amended and Restated 2013 Incentive Compensation Plan (subject to increase in accordance with the terms of such plan) and an additional 5,178,815 shares of common stock reserved for issuance under our Platform Specialty Products Corporation 2014 Employee Stock Purchase Plan.  

 

In addition, beginning in 2014, the holders of Series A Preferred Stock are entitled to receive dividends on the Series A Preferred Stock in the form of shares of our common stock equal to 20% of the appreciation over $10.00 of the average market price for the last ten days of our calendar year (which in subsequent years will be calculated based on the appreciated common stock price compared to the highest average common stock price previously used in calculating the dividend) multiplied by the number of shares issued in our initial public offering plus the number of shares of our common stock issuable upon conversion of our outstanding Series A Preferred Stock, which could have a dilutive impact on, and reduce the value of, our outstanding common stock.  We may also issue additional shares of our common stock or other securities that are convertible into or exercisable for our common stock in connection with future acquisitions, future issuances of our securities for capital raising purposes or for other business purposes.  

 

 

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Future sales of substantial amounts of our common stock, or the perception that sales could occur, could have a material adverse effect on the price of our common stock.

 

We may issue preferred stock in the future, and the terms of the preferred stock may reduce the value of our common stock.

 

Our Board is authorized to create and issue one or more additional series of preferred stock, and, with respect to each series, to determine the number of shares constituting the series and the designations and the powers, preferences and rights, and the qualifications, limitations and restrictions thereof, which may include dividend rights, conversion or exchange rights, voting rights, redemption rights and terms and liquidation preferences, without stockholder approval.  If we create and issue one or more additional series of preferred stock, it could affect your rights or reduce the value of our outstanding common stock.  Our Board could, without stockholder approval, issue preferred stock with voting and other rights that could adversely affect the voting power of the holders of our common stock and which could have certain anti-takeover effects.

 

We cannot assure you that we will declare dividends or have the available cash to make dividend payments.

 

To the extent we intend to pay dividends on our common stock, we will pay such dividends at such times (if any) and in such amounts (if any) as our Board determines appropriate and in accordance with applicable law.  Payments of such dividends will be dependent on the availability of any dividends or other distributions from our subsidiaries (including MacDermid and its subsidiaries) to us.   Additionally, we are subject to certain restrictions in our amended and restated credit agreement which may prohibit or limit our ability to pay dividends.  We can therefore give no assurance that we will be able to pay dividends going forward or as to the amount of such dividends, if any.

 

We are governed by Delaware law, which has anti-takeover implications.

 

We and our organizational documents are governed by Delaware law.  The application of Delaware law to us may have the effect of deterring hostile takeover attempts or a change in control.  In particular, Section 203 of the Delaware General Corporation Law imposes certain restrictions on merger, business combinations and other transactions between us and holders of 15% or more of our common stock.  A Delaware corporation may opt out of this provision either with an express provision in its original certificate of incorporation or in an amendment to its certificate of incorporation or by-laws approved by its stockholders.  We have not opted out of this provision.  Section 203 could prohibit or delay mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire us.

 

We operate as a holding company and our principal source of operating cash is income received from our subsidiaries.

 

We are a holding company and do not have any material assets or operations other than ownership of equity interests of our subsidiaries.  Our operations are conducted almost entirely through our subsidiaries, and our ability to generate cash to meet our obligations or to pay dividends is highly dependent on the earnings of, and receipt of funds from, our subsidiaries through dividends or intercompany loans.  As a result, we are dependent on the income generated by our subsidiaries to meet our expenses and operating cash requirements.  The amount of distributions and dividends, if any, which may be paid from our subsidiaries to us will depend on many factors, including results of operations and financial condition, limits on dividends under applicable law, its constitutional documents, documents governing any indebtedness of the respective subsidiary, and other factors which may be outside our control.  If our subsidiaries are unable to generate sufficient cash flow, we may be unable to pay our expenses or make distributions and dividends on the shares of common stock.

 

Volatility of our stock price could adversely affect our stockholders.

 

The market price of our common stock could also fluctuate significantly as a result of:

 

 

·

quarterly variations in our operating results;

 

 

·

interest rate changes;

 

 

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·

changes in the market’s expectations about our operating results;

 

 

·

our operating results failing to meet the expectation of securities analysts or investors in a particular period;

 

 

·

changes in financial estimates and recommendations by securities analysts concerning our company or our industry in general;

 

 

·

operating and stock price performance of other companies that investors deem comparable to us;

 

 

·

news reports relating to trends in our markets;

 

 

·

changes in laws and regulations affecting our business;

 

 

·

material announcements by us or our competitors;

 

 

·

sales of substantial amounts of common stock by our directors, executive officers or significant stockholders or the perception that such sales could occur;

 

 

·

general economic and political conditions such as recessions and acts of war or terrorism; and

 

 

·

the risk factors set forth in this prospectus and other matters discussed herein.

 

Fluctuations in the price of our common stock could contribute to the loss of all or part of a stockholder’s investment in our Company.

 

 

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Related:

Registration Statement No. 333-196235 iconRegistration Statement No. 333-182785

Registration Statement No. 333-196235 iconRegistration Statement No. 333-199817

Registration Statement No. 333-196235 iconFiled Pursuant to Rule 424(b)(4) Registration No. 333-194899

Registration Statement No. 333-196235 iconAs filed with the Securities and Exchange Commission on March 31, 2015 Registration No. 333

Registration Statement No. 333-196235 iconSec ”) a Registration Statement on Form s-4 that will include a joint...

Registration Statement No. 333-196235 iconPreparation of the Registration Statement

Registration Statement No. 333-196235 iconRegistration statement pursuant to section 12(b)

Registration Statement No. 333-196235 iconO Registration statement pursuant to Section 12(b) or (g)

Registration Statement No. 333-196235 iconO Registration statement pursuant to Section 12(b) or (g)

Registration Statement No. 333-196235 icon¨ registration statement pursuant to section 12(b) or (g) of the securities exchange act of 1934

Registration Statement No. 333-196235 iconO registration statement pursuant to section 12(b) or (g) of the securities exchange act of 1934

Registration Statement No. 333-196235 iconRegistration statement pursuant to section 12(b) or 12(g) of the securities exchange act of 1934

Registration Statement No. 333-196235 iconX registration statement pursuant to section 12(b) or (g) of the securities exchange act of 1934

Registration Statement No. 333-196235 iconRegistration statement pursuant to section 12(b) or (g) of the securities exchange act of 1934

Registration Statement No. 333-196235 iconRegistration statement pursuant to section 12(b) or 12(g) of the securities exchange act of 1934

Registration Statement No. 333-196235 iconRegistration statement pursuant to section 12(b) or (g) of the securities exchange act of 1934

Registration Statement No. 333-196235 iconRegistration statement pursuant to section 12(b) or 12(g) of the securities exchange act of 1934

Registration Statement No. 333-196235 iconRegistration statement pursuant to section 12(b) or (g) of the securities exchange act of 1934

Registration Statement No. 333-196235 icon[ ] registration statement pursuant to section 12(b) or (g) of the...

Registration Statement No. 333-196235 iconRegistration statement pursuant to section 12(b) or (g) of the securities exchange act of 1934




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