EXHIBIT 10.46
EXECUTION COPY - 22 03 2004
ASSET PURCHASE AGREEMENT
MANTEIA TECHNOLOGY
EXECUTION COPY - 22 03 2004
ARTICLE.1 PURCHASE AND SALE OF ASSETS................................. 5
ARTICLE.2 CLOSING AND PURCHASE PRICE.................................. 6
ARTICLE.3 REPRESENTATIONS AND WARRANTIES OF THE SELLER................ 8
ARTICLE.4 REPRESENTATIONS AND WARRANTIES OF SOLEXA.................... 9
ARTICLE.5 REPRESENTATIONS AND WARRANTIES OF LYNX...................... 10
ARTICLE.6 OTHER COVENANTS AND AGREEMENTS OF THE SELLER................ 13
ARTICLE.7 OTHER COVENANTS AND AGREEMENTS OF THE BUYERS................ 15
ARTICLE.8 OTHER COVENANTS AND AGREEMENTS OF LYNX AND THE SELLER
WITH RESPECT TO THE LYNX SHARES............................ 15
ARTICLE.9 CONDITIONS PRECEDENT........................................ 23
ARTICLE.10 MISCELLANEOUS............................................... 24
SCHEDULE.1.1 MANTEIA TANGIBLE ASSETS.....................................
SCHEDULE.1.2 MANTEIA PATENTS.............................................
SCHEDULE.1.3 MANTEIA KNOW HOW............................................
SCHEDULE.1.4 MOSAIC LICENSE..............................................
SCHEDULE.2.2 EXAMPLE OF THE COMPUTATION OF THE DEFFERED CONSIDERATION....
SCHEDULE.2.3A FORM OF ASSIGNMENT OF PATENTS...............................
SCHEDULE.2.3C WAIVER FROM EMPLOYEES.......................................
SCHEDULE.2.3D LETTER FROM SERONO SA.......................................
SCHEDULE.2.3I LETTER TO GLAXOSMITHKLINE...................................
SCHEDULE.2.3J MOSAIC LICENSE ASSIGNMENT AGREEMENT.........................
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SCHEDULE.5.1 LYNX DISCLOSURE SCHEDULE....................................
SCHEDULE.5.F LYNX SECURITIES.............................................
SCHEDULE.5.L LYNX SECURITIES REGISTRATION RIGHTS.........................
SCHEDULE.8.3A PLAN OF DISTRIBUTION........................................
SCHEDULE.8.8 EXISTING LYNX REGISTRATION RIGHTS...........................
SCHEDULE.8.10 OTHER REGISTRATION STATEMENT................................
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This Asset Purchase Agreement (the "AGREEMENT") is made and entered into as of
March 22, 2004 ( the "SIGNING DATE") by and between:
MANTEIA SA, a company established under the laws of Switzerland and having its
registered office at zone industrielle, 1267 Coinsins, Switzerland (the
"SELLER")
on the one hand
and
SOLEXA LIMITED, a company established under the laws of England and Wales and
having its registered office at Xxxxxx Xxxxxxxxxxx, Xxxxxxx Xxxxxx, Xxxxx XX00
0XX (hereinafter referred to as "SOLEXA")
and
LYNX THERAPEUTICS INC, a company established under the laws of Delaware and
having its registered office at 00000 Xxxxxxxxxx Xxxxxxxxx, Xxxxxxx, XX 00000,
Xxxxxx Xxxxxx of America (hereinafter referred to as "LYNX")
(Solexa and Lynx hereinafter collectively referred to as the "BUYERS", each of
them a "BUYER")
on the other hand
The Seller and the Buyers are hereinafter collectively referred to as the
"PARTIES", and individually as a "PARTY".
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PREAMBLE
Whereas the Seller was incorporated in November 2000 and has been working toward
the development of a proprietary technology in the field of genotyping and high
throughput sequencing of human DNA.
Whereas, due to financial difficulties, the Seller has initiated on November 4,
2003 a debt restructuring procedure by filing a request for a provisory debt
restructuring moratorium pursuant to Article 293 of the Swiss Debt Enforcement
and Bankruptcy Statute.
Whereas the Debt Restructuring Court has granted to the Seller a provisory debt
restructuring moratorium for a period of two months on November 10, 2003.
Whereas the Debt Restructuring Court has appointed a commissioner (in the person
of Xx Xxxxx Vocat, the "COMMISSIONER") in order to supervise the activities of
the Seller.
Whereas a debt restructuring moratorium (the "MORATORIUM") has been granted by
the Debt Restructuring Court and is in force until August 2, 2004. The duration
of the Moratorium can be further extended by Court decision.
Whereas the Seller currently employs only two employees, of which only Xx
Xxxxxxx Xxxxxxxx is still in activity for the Seller. All other employment
relationships have been terminated by the Seller in accordance with the
provisions of the Swiss Federal Code of Obligations ("CO").
Whereas the Seller has organized a bid process for the sale of its assets under
the supervision of the Commissioner.
Whereas Lynx and Solexa were allowed to (i) conduct technical and legal due
diligence and site visit at the Seller's premises for two consecutive days each,
(ii) ask detailed follow-up questions to the Seller, all of which were promptly
answered by the Seller, and (iii) share the results of such investigations with
one another.
Whereas the Buyers have shown their interest in purchasing certain assets of the
Seller and have sent to the Seller an Offer Letter dated February 17, 2004.
Whereas the Buyers now desire to purchase from the Seller and the Seller desires
to sell to the Buyers certain assets of the Seller specifically designated in
this Agreement and the related schedules.
Whereas the Parties do not intend to structure the present transaction as a
transfer of a business with assets and liabilities in accordance with article
181 CO.
NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:
ARTICLE.1 PURCHASE AND SALE OF ASSETS
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1.1 On and subject to the terms and conditions set forth in this Agreement,
the Seller hereby agrees to sell, assign, transfer and deliver to the
Buyers and the Buyers agree to purchase from the Seller all of the
Seller's right, title and interest in and to the following assets
(collectively, the "PURCHASED ASSETS"):
(i) Tangible assets: the tangible assets set forth in SCHEDULE 1.1
hereto (the "TANGIBLE ASSETS").
(ii) Patents: the patents set forth in SCHEDULE 1.2 hereto (the
"PATENTS").
(iii) Know how: the know how of the Seller derived from or associated with
the Tangible Assets and the Patents (the "KNOW HOW"), including but
not limited to the Know How set forth in SCHEDULE 1.3.
(iv) License: The license to the Patents of Mosaic Technologies as set
forth in SCHEDULE 1.4 hereto (the "MOSAIC LICENSE").
1.2 The Parties agree not to structure this purchase as a transfer of a
business with assets and liabilities in accordance with art. 181 CO.
ARTICLE.2 CLOSING AND PURCHASE PRICE
2.1 The closing of the transactions contemplated by this Agreement (the
"CLOSING") shall take place at the latest ten (10) business days following
the satisfaction of the Conditions Precedent set forth in clauses (i) and
(ii) of Article 9.1 below, or such other date as the Parties may mutually
agree in writing.
2.2 The aggregate purchase price for the Purchased Assets is USD 4'000'000.-
(four million US dollars) (hereinafter referred to as the "PURCHASE
PRICE"). The payment of the Purchase Price shall be made as follows:
(i) Cash Consideration:
At the Closing, Solexa shall arrange for payment to the Seller of USD
2'000'000 (two million US Dollars), being fifty (50) percent of the
Purchase Price in cash (the "CASH CONSIDERATION") by a wire transfer of
freely available USD denominated funds to Seller's bank account to be
indicated by the Seller.
(ii) Share Consideration:
At the Closing, Lynx shall issue and deliver to the Seller shares of
common stock of Lynx (the "LYNX SHARES") for a value representing the
remaining fifty (50) percent of the Purchase Price (the "SHARE
CONSIDERATION"). The number of Lynx Shares to be issued and delivered to
the Seller for the Share Consideration shall be determined by reference to
the average of the volume weighted average price of Lynx Shares for the
ten (10) trading days prior to the day prior to the filing date of the
Registration Statement with the U.S. Securities and Exchange Commission
(the "COMMISSION"), as per Article 8.3 below, less a 20% discount. An
example of the computation of the Share Consideration is attached as
SCHEDULE 2.2. Price and volume information used to determine the number of
Lynx Shares to be issued to the Seller shall be extracted from a reliable
external source of information such as Reuters or Bloomberg.
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2.3 At the Closing, the Seller shall deliver to the Buyers:
a) A duly executed assignment of the Patents (notarized and apostilled for
Manteia SA), essentially on the form attached hereto as SCHEDULE 2.3a);
b) The Patents prosecution files, any general and background files and any
summaries, searches and opinions relating to the Patents, any and all
searches, opinions, summaries etc. relating to the Freedom to Operate
(FTO) of the Patents and any documentation relating to draft
applications or subject-matter considered for filing in the last
eighteen (18) months but have never been filed, if any;
c) Duly executed waivers of the two current employees, essentially in the
form attached hereto as SCHEDULE 2.3c);
d) Letter of Serono, essentially in the form attached hereto, as SCHEDULE
2.3d)
e) The Tangible Assets;
f) A duly passed resolution of the board of directors of the Seller
approving the execution and consummation of this Agreement;
g) The approval of the Commissioner to execute and consummate this
Agreement;
h) An approval rendered by the Tribunal d'arrondissement de xx Xxxx, 1260
Nyon (the "DEBT RESTRUCTURING COURT") approving the execution and
consummation of this Agreement;
i) The letter sent to and countersigned by GlaxoSmithKline, a copy of
which is attached hereto as SCHEDULE 2.3i);
j) A written document assigning the Mosaic License to the Buyers (the
"MOSAIC LICENSE ASSIGNMENT AGREEMENT") essentially in the form attached
hereto as SCHEDULE 2.3j);
k) A complete set of all agreements still in force or already terminated
which relate to the Patents, the Know-How and the Mosaic-License;
l) A complete set of any and all publications relating to the Patents, the
Know-How and the Mosaic-License.
2.4 At Closing the Buyers shall deliver to the Seller duly passed resolutions
of the Board of Directors of each of the Buyers approving the execution
and consummation of this Agreement.
2.5
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a) The Buyers undertake to remove from the seller's premises of the Tangible
Assets and all files and documents relating to the Patents, the Know How
and the Mosaic License within 30 days after the Closing.
b) From the Signing Date on and for 30 days after the Closing, the Seller
undertakes to maintain existing security to its premises in order to
safeguard the Purchased Assets and all documents related thereto and to
keep the premises and its installation in the current working conditions
(e.g. electricity, light, air condition etc) so that the Purchased Assets
do not lose their functionality;
c) From the Closing on and for 30 days after the Closing, the Seller
undertakes to grant to the Buyers access to its premises from 8 am until 6
pm on each business day in the Canton of Vaud.
ARTICLE.3 REPRESENTATIONS AND WARRANTIES OF THE SELLER
3.1 The Seller represents and warrants, as of the Signing Date and the
Closing, to the Buyers as follows:
a) ORGANIZATION: The Seller is a corporation duly organized and validly
existing under the laws of Switzerland. The Seller is under the protection
of the Moratorium in accordance with the laws of Switzerland.
b) AUTHORIZATION: Subject to the Conditions Precedent set forth in Article
9.1 (i) and (ii) below, the Seller has the requisite corporate power and
authority to enter into and consummate the transaction contemplated by
this Agreement and otherwise to carry out its obligations hereunder and
thereunder. The execution and delivery of each of this Agreement by the
Seller and the consummation by it of the transactions contemplated hereby
and thereby have been duly authorized by all necessary action on the part
of its part and no further consent or action is required by its board of
directors or its stockholders. This Agreement has been (or upon delivery
will be) duly executed by the Seller and is, or when delivered in
accordance with the terms hereof, will constitute, the valid and binding
obligation of the Seller enforceable against it in accordance with its
terms.
c) TANGIBLE ASSETS: The Seller is the legal and beneficial owner of and has
good and valid record title, to the extent that valid record to title is
capable of existing, to all of the Tangible Assets. All Tangible Assets
are owned by the Seller free and clear of all encumbrances.
d) LITIGATION: To the best of the knowledge of the Seller, no action, claim,
suit, judgment, injunction, order, decree, proceeding or investigation is
threatened or has ever been notified in writing to the Seller relating to
or affecting any of the Purchased Assets and the Seller has never
instigated any litigation relating to or affecting any of the Purchased
Assets.
e) PATENTS: All costs and fees pertaining to the prosecution, registration
and renewal of the Patents have been duly paid with all the relevant
registries and all agents' fees and work in progress has been paid for and
will have been paid for at the Closing. The Seller
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exclusively owns all right, title and interest to and in the Patents
free an clear of any encumbrances.
f) NON-CONTRAVENTION; CONSENTS: To the best of the knowledge of the Seller,
neither the execution and delivery of the Agreement, nor the consummation
or performance of any of the transactions contemplated hereunder, will
directly or indirectly (with or without notice or lapse of time):
(i) contravene, conflict with or result in a violation of, or give
any governmental body the right to challenge any of the
transactions contemplated hereunder or to exercise any remedy
or obtain any relief under, any order, judgment or decree of
any court or other governmental agency to which the Seller, or
any of the Tangible Assets, is subject; or
(ii) contravene, conflict with or result in a violation of any of
the terms or requirements of, or give any governmental body the
right to revoke, withdraw, suspend, cancel, terminate or
modify, any governmental authorization that is to be included
in the Tangible Assets or is held by the Seller.
3.2 The representations and warranties of the Seller are expressly limited to
those set forth in this Article 3.1. No other representations or
warranties, of whatever nature and whatever kind, are given by the Seller
in relation to this Agreement.
3.3 The Seller does not represent or warrant the suitability, usefulness or
applicability of the Purchased Assets. The Seller does not represent or
warrant either that the Tangible Assets are in good and/or working
condition.
3.4 The Buyers performed a due diligence and site visit at the Seller's
premises and purchase the Purchased Assets in an "as is" condition.
3.5 The representations and warranties made by the Seller under this Agreement
terminate one year after the Closing and shall be limited to a maximum
amount equivalent to:
a) The Cash Consideration; plus
b) The net proceeds (after deduction of costs and fees) from the sale
of the Lynx Shares (Share Consideration); plus
c) Any remaining Lynx Shares (Share Consideration) not sold by the
Seller and therefore still owned by the Seller.
ARTICLE.4 REPRESENTATIONS AND WARRANTIES OF SOLEXA
4.1 Solexa represents and warrants to the Seller as of the Signing Date and
the Closing, as follows:
a) ORGANIZATION: Solexa is an entity duly organized, validly existing and in
good standing under the laws of England and Wales. Solexa is not aware of
any circumstances which could (i) adversely affect the legality, validity
or enforceability of this Agreement or (ii)
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adversely impair its ability to perform fully on a timely basis its
obligations under this Agreement.
b) AUTHORIZATION: Solexa has the corporate power and authority to execute and
deliver this Agreement and to perform fully its obligations hereunder.
c) LITIGATION: There is no action, claim, suit, judgement, injunction, order
or decree pending, or to Solexa's knowledge threatened, against Solexa
that relates to the transactions contemplated by this Agreement, nor are
there agreements or envisaged agreements which are capable of impacting on
Solexa's ability to fulfill its obligations under this Agreement.
4.2 The representations and warranties of Solexa are expressly limited to
those set forth in Article 4.1. No other representations or warranties, of
whatever nature and whatever kind, are given by Solexa in relation to this
Agreement.
ARTICLE.5 REPRESENTATIONS AND WARRANTIES OF LYNX
5.1 Subject to Schedule 5.1, Lynx represents and warrants to the Seller as of
the Signing Date and of the Closing as follows:
a) ORGANIZATION: Lynx is an entity duly organized, validly existing and in
good standing under the laws of the jurisdiction of its incorporation,
with the requisite power and authority to own and use its properties and
assets and to carry on its business as currently conducted. Neither Lynx
nor any of its subsidiaries (the"SUBSIDIARIES") is in violation of any of
the provisions of its respective certificate or articles of incorporation,
bylaws or other organizational or charter documents. Lynx and each of its
Subsidiaries is duly qualified to do business and is in good standing as a
foreign corporation or other entity in each jurisdiction in which the
nature of the business conducted or property owned by it makes such
qualification necessary, except where the failure to be so qualified or in
good standing, as the case may be, could not, individually or in the
aggregate, (i) adversely affect the legality, validity or enforceability
of this Agreement, (ii) have or result in a material adverse effect on the
results of operations, assets, prospects, business or condition (financial
or otherwise) of Lynx, or (iii) adversely impair Lynx's ability to perform
fully on a timely basis its obligations under this Agreement (any of (i),
(ii) or (iii), a "MATERIAL ADVERSE EFFECT").
b) AUTHORIZATION: Lynx has the requisite corporate power and authority to
enter into and to consummate the transactions contemplated by this
Agreement and otherwise to carry out its obligations hereunder and
thereunder. The execution and delivery of this Agreement and the
consummation by it of the transactions contemplated hereby have been duly
authorized by all necessary action on its part and no further consent or
action is required by its board of directors or its stockholders. This
Agreement has been (or upon delivery will be) duly executed by Lynx and
is, or when delivered in accordance with the terms hereof, will
constitute, the valid and binding obligation of Lynx enforceable against
it in accordance with its terms.
c) NO CONFLICTS: The execution, delivery and performance of this Agreement
and the consummation by Lynx of the transactions contemplated hereby do
not and will not (i)
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conflict with or violate any provision of Lynx's certificate or articles
of incorporation, bylaws or other organizational or charter documents,
(ii) conflict with, or constitute a default (or an event that with notice
or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation (with
or without notice, lapse of time or both) of, any agreement, credit
facility, debt or other instrument (evidencing Lynx's debt or otherwise)
or other understanding to which Lynx is a party or by which any property
or asset of Lynx is bound or affected, except to the extent that such
conflict, default or termination right could not reasonably be expected to
have a Material Adverse Effect, or (iii) result in a violation of any law,
rule, regulation, order, judgment, injunction, decree or other restriction
of any court or governmental authority to which Lynx is subject (including
U.S. federal and state securities laws and regulations), or by which any
property or asset of Lynx or of its Subsidiaries is bound or affected.
d) LITIGATION: There is no action, claim, suit, judgement, injunction, order
or decree pending, or to Lynx's knowledge threatened, against Lynx that
relates to the transactions contemplated by this Agreement, nor are there
agreements or envisaged agreements which are capable of impacting Lynx's
ability to fulfill its obligations under this Agreement.
e) ISSUANCE OF THE LYNX SHARES: The Lynx Shares are duly authorized and, when
issued and paid for in accordance with this Agreement, will be duly and
validly issued, fully paid and nonassessable, free and clear of all liens
and shall not be subject to preemptive rights or similar rights of
stockholders.
f) CAPITALIZATION: The number of shares and type of all authorized, issued
and outstanding capital stock, options and other securities of Lynx
(whether or not presently convertible into or exercisable or exchangeable
for shares of capital stock of Lynx) is set forth in SCHEDULE 5.f. All
outstanding shares of capital stock are duly authorized, validly issued,
fully paid and nonassessable and have been issued in compliance with all
applicable securities laws.
Except as set forth in SCHEDULE 5.f, there are no outstanding options,
warrants, script rights to subscribe to, calls or commitments of any
character whatsoever relating to, or securities, rights or obligations
convertible into or exercisable or exchangeable for, or giving any person
or entity any right to subscribe for or acquire, any shares of common
stock of Lynx (the "COMMON STOCK"), or contracts, commitments,
understandings or arrangements by which Lynx is or may become bound to
issue additional shares of Common Stock, or securities or rights
convertible or exchangeable into shares of Common Stock. Except as set
forth in SCHEDULE 5.f, there are no anti-dilution or price adjustment
provisions contained in any security issued by Lynx (or in any agreement
providing rights to security holders) and the issue and sale of the Lynx
Shares will not obligate Lynx to issue shares of Common Stock or other
securities to any person or entity (other than the Seller) and will not
result in a right of any holder of Lynx securities to adjust the exercise,
conversion, exchange or reset price under such securities. To the
knowledge of Lynx, except as specifically disclosed in SCHEDULE 5.f, no
person and entity or group of related person and entities beneficially
owns (as determined pursuant to Rule 13d-3 under the U.S. Securities
Exchange Act of 1934, as amended, the "EXCHANGE ACT"), or has the right to
acquire, by agreement with or by obligation binding upon Lynx, beneficial
ownership of in excess of 5% of the outstanding Common Stock, ignoring for
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such purposes any limitation on the number of shares of Common Stock that
may be owned at any single time.
g) SEC REPORTS; FINANCIAL STATEMENTS: Lynx has filed all reports required to
be filed by it under the U.S. Securities Act of 1933, as amended (the
"SECURITIES ACT") and the EXCHANGE ACT, including pursuant to Section
13(a) or 15(d) thereof, for the two years preceding the date hereof (or
such shorter period as Lynx was required by law to file such material)
(the foregoing materials being collectively referred to herein as the "SEC
REPORTS" and, together with this Agreement and the Schedules to this
Agreement, the "DISCLOSURE MATERIALS") on a timely basis or has received a
valid extension of such time of filing and has filed any such SEC Reports
prior to the expiration of any such extension. As of their respective
dates, the SEC Reports complied in all material respects with the
requirements of the Securities Act and the Exchange Act and the rules and
regulations of the Commission promulgated thereunder, and none of the SEC
Reports, when filed, contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The financial
statements of Lynx included in the SEC Reports comply in all material
respects with applicable accounting requirements and the rules and
regulations of the Commission with respect thereto as in effect at the
time of filing. Such financial statements have been prepared in accordance
with United States generally accepted accounting principles applied on a
consistent basis during the periods involved ("GAAP"), except as may be
otherwise specified in such financial statements or the notes thereto or,
in the case of unaudited financial statements, as permitted by Form 10-Q
of the Commission, and fairly present in all material respects the
financial position of Lynx and its consolidated subsidiaries as of and for
the dates thereof and the results of operations and cash flows for the
periods then ended, subject, in the case of unaudited statements, to
normal, immaterial, year-end audit adjustments. All material agreements,
as such contracts are defined in Section 601(a)(10) of Regulation S-K
under the Securities Act, to which Lynx is a party or to which the
property or assets of Lynx are subject are included as part of or
specifically identified in the SEC Reports.
h) MATERIAL CHANGES: Since September 30, 2003, the date of the latest
financial statements included within the SEC Reports, except as
specifically disclosed in the SEC Reports, (i) there has been no event,
occurrence or development that, individually or in the aggregate, has had
or that could result in a Material Adverse Effect, (ii) Lynx has not
incurred any liabilities (contingent or otherwise) other than (A) trade
payables and accrued expenses incurred in the ordinary course of business
consistent with past practice and (B) liabilities not required to be
reflected in Lynx's financial statements pursuant to GAAP or required to
be disclosed in filings made with the Commission, (iii) Lynx has not
altered its method of accounting or the identity of its auditors, (iv)
Lynx has not declared or made any dividend or distribution of cash or
other property to its stockholders or purchased, redeemed or made any
agreements to purchase or redeem any shares of its capital stock, and (v)
Lynx has not issued any equity securities to any officer, director, or
affiliate except pursuant to existing Lynx stock option and stock purchase
plans.
i) PRIVATE PLACEMENT: Neither Lynx nor any person or entity acting on Lynx's
behalf has sold or offered to sell or solicited any offer to buy the Lynx
Shares by means of any form of general solicitation or advertising.
Neither Lynx nor any person or entity acting on Lynx's behalf has,
directly or indirectly, at any time within the past six months, made any
offer or sale of any security or solicitation of any offer to buy any
security under
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circumstances that would (i) eliminate the availability of the exemption
from registration under Regulation D under the Securities Act in
connection with the offer and sale of the Lynx Shares as contemplated
hereby or (ii) cause the offering of the Lynx Shares pursuant to this
Agreement to be integrated with prior offerings by Lynx for purposes of
any applicable law, regulation or stockholder approval provisions,
including, without limitation, under the rules and regulations of any
trading market (the Nasdaq Small Cap Market, the New York Stock Exchange,
the American Stock Exchange or the Nasdaq National Market, a "TRADING
MARKET"). Lynx is not, and is not an affiliate (meaning a person or entity
that, directly or indirectly, through one or more intermediaries, controls
or is controlled by or is under common control with a person or entity, an
"AFFILIATE") of, an "investment company" within the meaning of the
Investment Securities Act of 1940, as amended. Lynx is not a United States
real property holding corporation within the meaning of the Foreign
Investment in Real Property Tax Act of 1980.
j) FORM S-3 ELIGIBILITY: Lynx is eligible to register its Common Stock for
resale by the Seller using Form S-3 promulgated under the Securities Act.
k) LISTING AND MAINTENANCE REQUIREMENTS: Except as described in Lynx's Annual
Report for the year ended December 31, 2002 initially filed on Form 10-K
with the Commission on March 28, 2003, as amended (the "ANNUAL REPORT"),
Lynx has not, in the two years preceding the date hereof, received notice
(written or oral) from any Trading Market on which the Common Stock is or
has been listed or quoted to the effect that Lynx is not in compliance
with the listing or maintenance requirements of such Trading Market.
l) REGISTRATION RIGHTS: Except as described in SCHEDULE 5.L, Lynx has not
granted or agreed to grant to any person or entity any rights (including
"piggy-back" registration rights) to have any securities of Lynx
registered with the Commission or any other governmental authority that
have not been satisfied.
5.2 The representations and warranties of Lynx are expressly limited to those
set forth in this Article 5.1. No other representations or warranties, of
whatever nature and whatever kind, are given by Lynx in relation to this
Agreement.
ARTICLE.6 OTHER COVENANTS AND AGREEMENTS OF THE SELLER
6.1. The Seller undertakes to use best endeavours to assist the Buyers in
completing the legal transfer of the Patents to one or both of the Buyers,
it being understood that the procedures relating to the registration of
the Patents in the name of the Buyers will be carried out by the Buyers.
All third party costs (invoices of third parties, registration fees, etc.)
in relation thereto, if any, shall be borne by the Buyers, whereas no
entity in which Serono has a majority of the voting rights or a majority
of the shares shall be considered as a third party. Before instructing any
third parties, the Seller shall first consult with the Buyers and obtain
their written approval.
6.2. Seller undertakes for a period of two (2) years after the Closing not to
(i) directly or indirectly compete with either of the Buyers, (ii) provide
products or services to direct or indirect competitors of the Buyers,
(iii) acquire participations or other interests in such direct or indirect
competitors, or (iv) cooperate in any way with, or act for, such direct or
indirect competitors. This covenant not to compete extends to all
companies and partnerships controlled by Seller.
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The relevant market with regard to (i) territory and (ii) products and
services comprises all markets in which the Buyers, directly or through
subsidiaries, offer their products and services at the time of the
asserted infringement of the undertaking.
Further, during two (2) years after the Closing, Seller will not employ
(as employee or consultant) any person who is or becomes an employee of
either of the Buyers on or after the Signing Date, and will not allow such
employment by any company or partnership controlled by Seller.
For each infringement of the undertakings made in this Article 6.2, Seller
owes to the Buyers a contractual penalty of USD 500,000 (five hundred
thousand United States Dollars) in accordance with art. 161 para. 1 CO,
regardless of the occurrence of actual damages. In addition, Seller owes
full indemnification for all damages suffered by the Buyers (without the
right to offset the amount of the contractual penalty), and the Buyers may
prohibit further infringements of the undertakings and require the
elimination of any continued infringement.
6.3. 30 days after the Effective Date, Seller shall use best endeavors to
delete all copies of the Know-How remaining in its possession.
6.4. For the purpose of assisting the Buyers in achieving the full transfer of
the Purchased Assets, the Seller shall procure to the Buyers the services
of Xx. Xxxxxxx Xxxxxxxx, three (3) days a week for a period of three (3)
months from the Closing, subject to vacation entitlement of seven (7) days
over the period. In relation thereto, the Parties agree as follows:
6.4.1 The salary of Mr Turcatti will be entirely borne by the Seller
whereby any additional expenses associated with the provision of the
services by Mr. Turcatti will be borne by the Buyers.
6.4.2 Should the Buyers require the presence of Mr. Turcatti outside of
Europe, then Mr. Turcatti shall travel to such place in business
class. Mr. Turcatti shall be accommodated in convenient and mutually
agreed upon hotels. Any request for the presence of Mr. Turcatti on
either of the Buyers' facilities shall be made with, at least, the
following written advance notice: two business days for a travel to
Solexa's facilities and four business days for a travel to Lynx's
facilities.
6.5.
a) The Seller agrees to the imprinting, so long as is required by this
Section, of the following legend on any certificate evidencing Lynx
Shares:
THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN
RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY,
MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT
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TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN
ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.
b) Certificates evidencing Lynx Shares shall not be required to contain
such legend or any other legend (i) following any sale of such Lynx
Shares while a registration statement covering the resale of such
Lynx Shares is effective under the Securities Act, provided that the
prospectus delivery requirements of the Securities Act have been
met, or (ii) following any sale of such Lynx Shares pursuant to Rule
144 under the Securities Act, or (iii) if such Lynx Shares are
eligible for sale under Rule 144(k), or (iv) if such legend is not
required under applicable requirements of the Securities Act
(including judicial interpretations and pronouncements issued by the
Staff of the Commission). Lynx shall cause its counsel to issue a
legal opinion on the date that the Registration Statement (as
defined under art. 8.3 below) is first declared effective by the
Commission, the "EFFECTIVE DATE"). Following the Effective Date or
at such earlier time as a legend is no longer required for certain
Lynx Shares, Lynx will no later than three trading days (any day on
which the Common Stock is listed or quoted on the Nasdaq Small Cap
Market, the "TRADING DAYS") following the delivery by the Seller to
Lynx or the Transfer Agent of a legended certificate representing
such Lynx Shares and following delivery by the Seller to Lynx or
Lynx's counsel of a signed and completed notice of sale representing
that the prospectus delivery requirements of the Securities Act have
been met with respect to such sale, deliver or cause to be delivered
to the Seller a certificate representing such Lynx Shares that is
free from all restrictive and other legends. Lynx may not make any
notation on its records or give instructions to any transfer agent
of Lynx that enlarge the restrictions on transfer set forth in this
Article.
ARTICLE.7 OTHER COVENANTS AND AGREEMENTS OF THE BUYERS
The Buyers acknowledge that the Seller has entered into a patent assignment
agreement dated June 10, 2002 (the "GSK PATENT ASSIGNMENT AGREEMENT") with Glaxo
Group Limited and SmithKline Xxxxxxx Corporation ("GLAXOSMITHKLINE") by which
the latter have assigned certain patent applications to the Seller and by which
the Seller has granted to GlaxoSmithKline a world-wide, non-exclusive license to
use such patents applications for internal research purposes. The Buyers thus
agree to assume the obligation of the Seller under the GSK Patent Assignment
Agreement by granting such license to GlaxoSmithKline on such patent
applications.
ARTICLE.8 OTHER COVENANTS AND AGREEMENTS OF LYNX AND THE SELLER WITH RESPECT
TO THE LYNX SHARES
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8.1. FURNISHING OF INFORMATION: As long as the Seller owns Lynx Shares, Lynx
covenants to timely file (or obtain extensions in respect thereof and file
within the applicable grace period) all reports required to be filed by
Lynx after the date hereof pursuant to the Exchange Act. Upon the request
of the Seller, Lynx shall deliver to the Seller a written certification of
a duly authorized officer as to whether it has complied with the preceding
sentence. During the earlier of (i) the date two years from the Closing or
(ii) as long as the Seller owns Lynx Shares, if Lynx is not required to
file reports pursuant to such laws, it will prepare and furnish to the
Seller and make publicly available in accordance with paragraph (c) of
Rule 144 such information as is required for the Seller to sell the Lynx
Shares under Rule 144. Lynx further covenants that it will take such
further action as any holder of Lynx Shares may reasonably request to
satisfy the provisions of Rule 144 applicable to the issuer of securities
relating to transactions for the sale of securities pursuant to Rule 144.
8.2. INTEGRATION: Lynx shall not, and shall use its best efforts to ensure that
no Affiliates of Lynx shall sell, offer for sale or solicit offers to buy
or otherwise negotiate in respect of any security (as defined in Section 2
of the Securities Act) that would be integrated with the offer or sale of
the Lynx Shares in a manner that would require the registration under the
Securities Act of the sale of the Lynx Shares to the Seller, or that would
be integrated with the offer or sale of the Lynx Shares for purposes of
the rules and regulations of any Trading Market.
8.3. SHELF REGISTRATION:
a) No later than the later to occur of (i) 20 days after the Signing Date
or (ii) 3 days after the Conditions Precedent set forth in clauses (i)
and (ii) of Article 9.1 having been met, Lynx shall prepare and file
with the Commission a "Shelf" registration statement covering the
resale of all the Lynx Shares for an offering to be made on a
continuous basis pursuant to Rule 415 (the "REGISTRATION STATEMENT").
The date on which Lynx files the Registration Statement in accordance
with the preceding sentence referred to herein as the "FILING DATE".
The Registration Statement shall be on Form S-3 (except if Lynx is not
then eligible to register for resale of the Lynx Shares on Form S-3, in
which case such registration shall be on another appropriate form in
accordance herewith as the Seller may consent) and shall contain
(except if otherwise directed by the Seller) the "Plan of Distribution"
attached hereto as SCHEDULE 8.3.a.
b) Lynx shall use its best efforts (as that concept is understood under
English law) to cause the Registration Statement to be declared
effective by the Commission as promptly as possible after the filing
thereof, but in any event prior to the date that is 60 days after the
Closing (the "REQUIRED EFFECTIVENESS DATE"), and shall use its best
efforts (as that concept is understood under English law) to keep the
Registration Statement continuously effective under the Securities Act
until the second anniversary of the Effective Date or such earlier date
when all Lynx Shares covered by such Registration Statement have been
sold or may be sold without volume restrictions pursuant to Rule 144(k)
(the "EFFECTIVENESS PERIOD").
c) Lynx shall notify the Seller in writing promptly (and in any event
within one Trading Day) after receiving notification from the
Commission that the Registration Statement has been declared effective.
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d) Upon the occurrence of any Event (as defined below) and on every
monthly anniversary thereof until the applicable Event is cured, as
partial relief for the damages suffered therefrom by the Seller (which
remedy shall not be exclusive of any other remedies available under
this Agreement, at law or in equity), Lynx shall pay to the Seller an
amount of USD 15'000 (fifteen thousand US dollars) in cash, as
liquidated damages and not as a penalty. The payments to which the
Seller shall be entitled pursuant to this Article 8.3(d) are referred
to herein as "Event Payments". Any Event Payments payable pursuant to
the terms hereof shall apply on a pro-rata basis for any portion of a
month prior to the cure of an Event. In the event Lynx fails to make
Event Payments in a timely manner, such Event Payments shall bear
interest at the rate of 1.5% per month (prorated for partial months)
until paid in full.
For such purposes, the occurrence of the Registration Statement not
being declared effective on or prior to the Required Effectiveness Date
shall constitute an "Event".
e) Notwithstanding anything in this Agreement to the contrary, Lynx may,
by written notice to the Seller, suspend sales under the Registration
Statement after the Effective Date thereof and/or require that the
Seller immediately cease the sale of shares of Common Stock pursuant
thereto if at any time Lynx determines in good faith that the
Registration Statement contains an untrue statement of a material fact
or omits to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading and cannot be
utilized in connection with the sale of shares of Common Stock until it
has been appropriately amended. Upon receipt of such notice, the Seller
shall immediately discontinue any sales of Lynx Shares pursuant to such
registration until the Seller has received copies of a supplemented or
amended prospectus or until the Seller is advised in writing by Lynx
that the then-current prospectus may be used and has received copies of
any additional or supplemental filings that are incorporated or deemed
incorporated by reference in such prospectus. In no event, however,
shall this right be exercised to suspend sales beyond the period during
which (in the good faith determination of Lynx's board of directors)
the failure to require such suspension would be materially detrimental
to Lynx. Furthermore, in no event may Lynx exercise its rights
hereunder for a period of more than 7 consecutive Trading Days or more
than 20 Trading Days in any twelve month period. Immediately after the
end of any suspension period under this Article 8.3(e), Lynx shall take
all necessary actions (including filing any required supplemental
prospectus) to restore the effectiveness of the Registration Statement
and the ability of the Seller to publicly resell its Lynx Shares
pursuant to such effective Registration Statement.
8.4. REGISTRATION PROCEDURES: In connection with Lynx's registration
obligations hereunder, Lynx shall:
a) Not less than three Trading Days prior to the filing of the
Registration Statement or any related prospectus or any amendment or
supplement thereto (specifically excluding any document that would be
incorporated or deemed to be incorporated therein by reference),
furnish to the Seller and to the Seller's counsel copies of all such
documents proposed to be filed, which documents (other than those
incorporated or deemed to be incorporated by reference) will be subject
to the review of the Seller and the Seller's counsel. Lynx shall not
file a Registration Statement or any such prospectus or any amendments
or supplements thereto to which the Seller shall reasonably object in
good
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faith. In the absence of any reaction from the Seller within three
working days, the Seller is deemed to consent to such documents
proposed to be filed.
b) (i) Prepare and file with the Commission such amendments, including
post-effective amendments, to the Registration Statement and the
prospectus used in connection therewith as may be necessary to keep the
Registration Statement continuously effective as to the Lynx Shares for
the Effectiveness Period; (ii) cause the related prospectus to be
amended or supplemented by any required prospectus supplement, and as
so supplemented or amended to be filed pursuant to Rule 424; (iii)
respond as promptly as reasonably possible, and in any event within 15
days, to any comments received from the Commission with respect to the
Registration Statement or any amendment thereto and as promptly as
reasonably possible provide the Seller true and complete copies of all
correspondence from and to the Commission relating to the Registration
Statement; and (iv) comply in all material respects with the provisions
of the Securities Act and the Exchange Act with respect to the
disposition of all Lynx Shares covered by the Registration Statement
during the applicable period in accordance with the intended methods of
disposition by the Seller thereof set forth in the Registration
Statement as so amended or in such prospectus as so supplemented.
c) Notify the Seller and the Seller's counsel as promptly as reasonably
possible, and (if requested by any such person or entity) confirm such
notice in writing no later than one Trading Day thereafter, of any of
the following events: (i) the Commission notifies Lynx whether there
will be a "review" of the Registration Statement; (ii) the Commission
comments in writing on the Registration Statement (in which case Lynx
shall deliver to the Seller a copy of such comments and of all written
responses thereto); (iii) the Registration Statement or any
post-effective amendment is declared effective; (iv) the Commission or
any other U.S. Federal or state governmental authority requests any
amendment or supplement to the Registration Statement or prospectus or
requests additional information related thereto; (v) the Commission
issues any stop order suspending the effectiveness of the Registration
Statement or initiates any proceedings, suits, actions, investigations,
proceedings ("the Proceedings") for that purpose; (vi) Lynx receives
notice of any suspension of the qualification or exemption from
qualification of any Lynx Shares for sale in any jurisdiction, or the
initiation or threat of any Proceeding for such purpose; or (vii) the
financial statements included in the Registration Statement become
ineligible for inclusion therein or any statement made in the
Registration Statement or prospectus or any document incorporated or
deemed to be incorporated therein by reference is untrue in any
material respect or any revision to Registration Statement, prospectus
or other document is required so that it will not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading.
d) Use its best efforts (as that concept is understood under English law)
to avoid the issuance of or, if issued, obtain the withdrawal of (i)
any order suspending the effectiveness of the Registration Statement,
or (ii) any suspension of the qualification (or exemption from
qualification) of any of the Lynx Shares for sale in any jurisdiction,
at the earliest practicable moment.
e) Furnish to the Seller and to the Seller's counsel, without charge, at
least one conformed copy of the Registration Statement and each
amendment thereto, including financial statements and schedules, all
documents incorporated or deemed to be incorporated
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therein by reference, and all exhibits to the extent requested by such
person or entity (including those previously furnished or incorporated
by reference) promptly after the filing of such documents with the
Commission.
f) Promptly deliver to the Seller and to the Seller's counsel, without
charge, as many copies of the prospectus or prospectuses (including
each form of prospectus) and each amendment or supplement thereto as
such person or entity may reasonably request. Lynx hereby consents to
the use of such prospectus and each amendment or supplement thereto by
the Seller in connection with the offering and sale of the Lynx Shares
covered by such prospectus and any amendment or supplement thereto.
g) (i) In the time and manner required by each Trading Market, prepare and
file with such Trading Market an additional shares listing application
covering all of the Lynx Shares; (ii) take all steps necessary to cause
such Lynx Shares to be approved for listing on each Trading Market as
soon as possible thereafter; (iii) provide to the Seller evidence of
such listing; and (iv) maintain the listing of the Lynx Shares on each
such Trading Market.
h) Prior to any public offering of Lynx Shares, use its best efforts (as
that concept is understood under English law) to register or qualify or
cooperate with the Seller and the Seller's counsel in connection with
the registration or qualification (or exemption from such registration
or qualification) of such Lynx Shares for offer and sale under the
securities or blue sky laws of such jurisdictions within the United
States as the Seller requests in writing, to keep each such
registration or qualification (or exemption therefrom) effective during
the Effectiveness Period and to do any and all other acts or things
necessary or advisable to enable the disposition in such jurisdictions
of the Lynx Shares covered by the Registration Statement; provided,
however, that Lynx shall not be obligated to file any general consent
to service of process or to qualify as a foreign corporation or as a
dealer in securities in any jurisdiction in which it is not so
qualified or to subject itself to taxation in respect of doing business
in any jurisdiction in which it is not otherwise subject.
i) Cooperate with the Seller to facilitate the timely preparation and
delivery of certificates representing Lynx Shares to be delivered to a
transferee pursuant to the Registration Statement, which certificates
shall be free, to the extent permitted by this Agreement, of all
restrictive legends, and to enable such Lynx Shares to be in such
denominations and registered in such names as the Seller may request.
j) Upon the occurrence of any event described in Article 8.4(c)(vii), as
promptly as reasonably possible, prepare a supplement or amendment,
including a post-effective amendment, to the Registration Statement or
a supplement to the related prospectus or any document incorporated or
deemed to be incorporated therein by reference, and file any other
required document so that, as thereafter delivered, neither the
Registration Statement nor such prospectus will contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading.
k) Comply with all applicable rules and regulations of the Commission.
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8.5. REGISTRATION EXPENSES. Lynx shall pay (or reimburse the Seller for) all
fees and expenses incident to the performance of or compliance with this
Article 8 of this Agreement by Lynx, including without limitation (a) all
registration and filing fees and expenses, including without limitation
those related to filings with the Commission, any Trading Market and in
connection with applicable state securities or Blue Sky laws, (b) printing
expenses (including without limitation expenses of printing certificates
for Lynx Shares and of printing prospectuses requested by the Seller), (c)
messenger, telephone and delivery expenses, (d) fees and disbursements of
counsel for Lynx, (e) fees and expenses of all other persons or entities
retained by Lynx in connection with the consummation of the transactions
contemplated by Article 8 of this Agreement, and (f) all listing fees to
be paid by Lynx to the Trading Market.
8.6. INDEMNIFICATION.
a) Lynx shall, notwithstanding any termination of this Agreement,
indemnify and hold harmless the Seller, its officers, directors,
partners, members, agents, brokers (including brokers who offer and
sell Lynx Shares as principal as a result of a pledge or any failure to
perform under a margin call of Common Stock), investment advisors and
employees, each person or entity who controls the Seller (within the
meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act) and the officers, directors, partners, members, agents
and employees of each such controlling person or entity, to the fullest
extent permitted by applicable law, from and against any and all
losses, claims, damages, liabilities, settlement costs and expenses,
including without limitation reasonable attorney's fees ("the Losses"),
as incurred, arising out of or relating to any untrue or alleged untrue
statement of a material fact contained in the Registration Statement,
any prospectus or any form of prospectus or in any amendment or
supplement thereto or in any preliminary prospectus, or arising out of
or relating to any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements
therein (in the case of any prospectus or form of prospectus or
supplement thereto, in the light of the circumstances under which they
were made) not misleading, except to the extent, but only to the
extent, that (i) such untrue statements, alleged untrue statements,
omissions or alleged omissions are based solely upon information
regarding the Seller furnished in writing to Lynx by the Seller
expressly for use therein, or to the extent that such information
relates to the Seller or the Seller's proposed method of distribution
of Lynx Shares and was reviewed and expressly approved in writing by
the Seller expressly for use in the Registration Statement, such
prospectus or such form of prospectus or in any amendment or supplement
thereto or (ii) in the case of an occurrence of an event of the type
specified in Article 8.4(c)(v)-(vii), the use by the Seller of an
outdated or defective prospectus after Lynx has notified the Seller in
writing that the prospectus is outdated or defective and prior to the
receipt by the Seller of the Advice contemplated in Article 8.7 below.
Lynx shall notify the Seller promptly of the institution, threat or
assertion of any Proceeding of which Lynx is aware in connection with
the transactions contemplated by this Agreement.
b) INDEMNIFICATION BY THE SELLER. The Seller shall indemnify and hold
harmless Lynx, its directors, officers, agents and employees, each
Person who controls Lynx (within the meaning of Section 15 of the
Securities Act and Section 20 of the Exchange Act), and the directors,
officers, agents or employees of such controlling Persons, to the
fullest extent permitted by applicable law, from and against all
Losses, as incurred, arising solely out of any untrue statement of a
material fact contained in the
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Registration Statement, any prospectus, or any form of prospectus, or
in any amendment or supplement thereto, or arising solely out of any
omission of a material fact required to be stated therein or necessary
to make the statements therein (in the case of any prospectus or form
of prospectus or supplement thereto, in the light of the circumstances
under which they were made) not misleading to the extent, but only to
the extent, that such untrue statement or omission is contained in any
information so furnished in writing by the Seller to Lynx specifically
for inclusion in such Registration Statement or such prospectus or to
the extent that (i) such untrue statements or omissions are based
solely upon information regarding the Seller furnished in writing to
Lynx by the Seller expressly for use therein, or to the extent that
such information relates to the Seller or the Seller's proposed method
of distribution of the Lynx Shares and was reviewed and expressly
approved in writing by the Seller expressly for use in the Registration
Statement, such Prospectus or such form of Prospectus or in any
amendment or supplement thereto or (ii) in the case of an occurrence of
an event of the type specified in Article 8.4(c)(v)-(vii), the use by
the Seller of an outdated or defective Prospectus after Lynx has
notified the Seller in writing that the Prospectus is outdated or
defective and prior to the receipt by the Seller of the Advice
contemplated in Article 8.7 below. In no event shall the liability of
the Seller hereunder be greater in amount than two million dollars (USD
$2,000,000).
c) Conduct of Indemnification Proceedings. If any Proceeding shall be
brought or asserted against any person or entity entitled to indemnity
hereunder (an "INDEMNIFIED PARTY"), such Indemnified Party shall
promptly notify the person or entity from whom indemnity is sought (the
"INDEMNIFYING Party") in writing, and the Indemnifying Party shall
assume the defense thereof, including the employment of counsel
reasonably satisfactory to the Indemnified Party and the payment of all
fees and expenses incurred in connection with defense thereof;
provided, that the failure of any Indemnified Party to give such notice
shall not relieve the Indemnifying Party of its obligations or
liabilities pursuant to this Agreement, except (and only) to the extent
that it shall be finally determined by a court of competent
jurisdiction (which determination is not subject to appeal or further
review) that such failure shall have proximately and materially
adversely prejudiced the Indemnifying Party.
An Indemnified Party shall have the right to employ separate counsel in
any such Proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such
Indemnified Party or Parties unless: (i) the Indemnifying Party has
agreed in writing to pay such fees and expenses; or (ii) the
Indemnifying Party shall have failed promptly to assume the defense of
such Proceeding and to employ counsel reasonably satisfactory to such
Indemnified Party in any such Proceeding; or (iii) the named parties to
any such Proceeding (including any impleaded parties) include both such
Indemnified Party and the Indemnifying Party, and such Indemnified
Party shall have been advised by counsel that a conflict of interest is
likely to exist if the same counsel were to represent such Indemnified
Party and the Indemnifying Party (in which case, if such Indemnified
Party notifies the Indemnifying Party in writing that it elects to
employ separate counsel at the expense of the Indemnifying Party, the
Indemnifying Party shall not have the right to assume the defense
thereof and such counsel shall be at the expense of the Indemnifying
Party). The Indemnifying Party shall not be liable for any settlement
of any such Proceeding effected without its written consent, which
consent shall not be unreasonably withheld. No Indemnifying Party
shall, without the prior written consent of the Indemnified Party,
effect any settlement of any pending Proceeding in respect of which any
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Indemnified Party is a party, unless such settlement includes an
unconditional release of such Indemnified Party from all liability on
claims that are the subject matter of such Proceeding.
All fees and expenses of the Indemnified Party (including reasonable
fees and expenses to the extent incurred in connection with
investigating or preparing to defend such Proceeding in a manner not
inconsistent with this Article) shall be paid to the Indemnified Party,
as incurred, within ten Trading Days of written notice thereof to the
Indemnifying Party (regardless of whether it is ultimately determined
that an Indemnified Party is not entitled to indemnification hereunder;
provided, that the Indemnifying Party may require such Indemnified
Party to undertake to reimburse all such fees and expenses to the
extent it is finally judicially determined that such Indemnified Party
is not entitled to indemnification hereunder).
d) Contribution. If a claim for indemnification under Article 8.6(a) is
unavailable to an Indemnified Party (by reasons other than the
specified exclusions to indemnification), then each Indemnifying Party,
in lieu of indemnifying such Indemnified Party, shall contribute to the
amount paid or payable by such Indemnified Party as a result of such
Losses, in such proportion as is appropriate to reflect the relative
fault of the Indemnifying Party and Indemnified Party in connection
with the actions, statements or omissions that resulted in such Losses
as well as any other relevant equitable considerations. The relative
fault of such Indemnifying Party and Indemnified Party shall be
determined by reference to, among other things, whether any action in
question, including any untrue or alleged untrue statement of a
material fact or omission or alleged omission of a material fact, has
been taken or made by, or relates to information supplied by, such
Indemnifying Party or Indemnified Party, and the parties' relative
intent, knowledge, access to information and opportunity to correct or
prevent such action, statement or omission. The amount paid or payable
by a party as a result of any Losses shall be deemed to include,
subject to the limitations set forth in Article 8.6, any reasonable
attorneys' or other reasonable fees or expenses incurred by such party
in connection with any Proceeding to the extent such party would have
been indemnified for such fees or expenses if the indemnification
provided for in this Article was available to such party in accordance
with its terms.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Article 8.6(c) were determined by prorata
allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the immediately
preceding paragraph. Notwithstanding the provisions of this Article
8.6(c), the Seller shall not be required to contribute, in the
aggregate, any amount in excess of the amount by which the proceeds
actually received by the Seller from the sale of the Lynx Shares
subject to the Proceeding exceeds the amount of any damages that the
Seller has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person or
entity guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution
from any person or entity who was not guilty of such fraudulent
misrepresentation.
The indemnity and contribution agreements contained in this Article are
in addition to any liability that the Indemnifying Parties may have to
the Indemnified Parties.
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8.7. DISPOSITIONS. The Seller agrees that it will comply with the prospectus
delivery requirements of the Securities Act as applicable to it in
connection with sales of Lynx Shares pursuant to the Registration
Statement. The Seller further agrees that, upon receipt of a notice from
Lynx of the occurrence of any event of the kind described in Articles
8.4(c)(v), (vi) or (vii), the Seller will discontinue disposition of such
Lynx Shares under the Registration Statement until the Seller's receipt of
the copies of the supplemented prospectus and/or amended Registration
Statement contemplated by Article 8.4(j), or until it is advised in
writing (the "Advice") by Lynx that the use of the applicable prospectus
may be resumed, and, in either case, has received copies of any additional
or supplemental filings that are incorporated or deemed to be incorporated
by reference in such prospectus or Registration Statement. Lynx may
provide appropriate stop orders to enforce the provisions of this
paragraph.
8.8. NO PIGGYBACK ON REGISTRATIONS. Other than pursuant to the exercise of
existing registration rights by certain stockholders of Lynx as specified
in SCHEDULE 8.8 hereto, neither Lynx nor any of its security holders
(other than the Seller in such capacity pursuant hereto) may include
securities of Lynx in the Registration Statement other than the Lynx
Shares, and Lynx shall not after the date hereof enter into any agreement
providing any such right to any of its security holders.
8.9. PIGGY-BACK REGISTRATIONS. If at any time during the Effectiveness Period
there is not an effective Registration Statement covering all of the Lynx
Shares and Lynx shall determine to prepare and file with the Commission a
registration statement relating to an offering for its own account or the
account of others under the Securities Act of any of its equity
securities, other than on Form S-4 or Form S-8 (each as promulgated under
the Securities Act) or their then equivalents relating to equity
securities to be issued solely in connection with any acquisition of any
entity or business or equity securities issuable in connection with stock
option or other employee benefit plans, then Lynx shall send to the Seller
written notice of such determination and if, within fifteen days after
receipt of such notice, the Seller shall so request in writing, Lynx shall
include in such registration statement all or any part of such Lynx Shares
the Seller requests to be registered.
8.10. OTHER REGISTRATION STATEMENTS. Except for the filing of the Registration
Statement, and except as provided in SCHEDULE 8.10, Lynx shall not, for a
period from the Signing Date until the day that is 21 days after the
Closing, file with the Commission a registration statement relating to an
offering for its own account or the account of others under the Securities
Act of any of its equity securities.
ARTICLE.9 CONDITIONS PRECEDENT
9.1. The respective obligations of the Parties to effect the transactions
contemplated under this Agreement shall be subject to the following
conditions precedent having been met (the "CONDITIONS PRECEDENT"):
(i) Written consent of the Commissioner by which the Commissioner shall
approve the sale of the Purchased Assets to the Buyers, as per the
terms of this Agreement;
(ii) Written consent of the Debt Restructuring Court approving the sale
of the Purchased Assets to the Buyers, as per the terms of this
Agreement;
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(iii) Filing of the Registration Statement by Lynx as defined under 8.3
above; and
(iv) No material adverse change to the condition of the Purchased Assets
between the Signing Date and the Closing.
9.2. The Seller undertakes and agrees to use its best efforts to have the
Conditions Precedent set forth in clauses (i) and (ii) of Article 9.1 met
as soon as possible after the Signing Date, provided however the Buyers
acknowledge and agree that the Seller has not the power to influence the
decisions which shall be taken (at their sole and entire discretion) by
the Commissioner and by the Debt Restructuring Court.
9.3. Should the Conditions Precedent not be met on or before April 30, 2004,
then this Agreement shall be automatically terminated, without prejudice
to rights and liabilities accrued by any party prior to such termination.
ARTICLE.10 MISCELLANEOUS
10.1. FURTHER ASSURANCES OF THE SELLER: The Seller shall execute and/or cause to
be delivered to the Buyers such instruments and other documents, and shall
take such other actions, as the Buyers may reasonably request (prior to,
at or after the Closing) for the purpose of carrying out or evidencing any
of the transactions contemplated hereunder.
10.2. PUBLICITY. Promptly following the realization of the Condition Precedent
9.1 (ii), Lynx and Solexa shall issue a joint press release, the contents
of which shall be mutually agreed upon between the Parties.
10.3. SEVERAL OBLIGATIONS OF THE BUYERS: Except where the context clearly
indicates otherwise, the Buyers' obligations under this Agreement are
several and not joint .
10.4. SEVERABILITY: Should one or several provisions of this Agreement be or
become invalid, then the Parties hereto shall substitute such invalid
provisions by valid ones, which in their economic effect come so close to
the invalid provisions that it can be reasonably assumed that the Parties
would have concluded this Agreement with such new provisions. In case such
provisions cannot be found or agreed upon, the invalidity of one or
several provisions of this Agreement shall not affect the validity of the
Agreement as a whole, unless the invalid provisions are of such essential
importance for this Agreement that it is to be reasonably assumed that the
Parties would not have concluded this Agreement without the invalid
provisions.
10.5. NOTICES: All notices, requests, demands, waivers and other communications
required or permitted to be given under the Agreements shall be in writing
and shall be deemed to have been duly given if delivered personally or
mailed, if sent by certified or registered mail with postage prepaid, or
if sent by telegram, telefax or by e-mail, as follows:
(i) If to the Seller, to the following address:
Manteia SA
Zone Industrielle
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1267 Coinsins
Switzerland
with copy to:
a) Bruno Vocat
C/o BfB Societe Fiduciaire SA
Avenue de Jomini 8
Xxxx Xxxxxxx 000
0000 Xxxxxxxx
Xxxxxxxxxxx
Telephone: (x00-00) 000 00 00
Fax: (x00-00) 000 00 00
b) Xxxx & Staehelin
Attn Guy Vermeil
Grand'Rue 25
1211 Geneve 11
Switzerland
Telephone: (x00-00) 000 0000
Fax: (x00-00) 000 0000
or to such other person or address as the Seller shall from time to time
specify by notice in writing to be sent by certified mail only to the
Buyers.
(ii) If to the Buyers, to:
a) Lynx Therapeutics, Inc
Attention: Xxxxx X. Xxxxxxxx
00000 Xxxxxxxxxx Xxx, Xxxxxxx,
XX 00000 XXX
Tel 000 000 00 00
Fax 000 000 00 00
b) Solexa Limited
Attention: Nick McCooke
Chesterford Research Park
Little Chesterford Nr Saffron Xxxxxx
Essex CB10 1 XL, England
Tel 00 (0) 0000 000 000
Fax 00(0) 0000 000 000
or to such other person or address as the Buyers shall from time to time
specify by notice in writing to be sent by certified mail only to the
Seller.
10.6. ENTIRE AGREEMENT: This Agreement (including the Schedules hereto)
constitutes the entire agreement and supersedes all prior agreements and
understandings, both written and oral, between the Parties with respect to
the subject matter hereof.
10.7. AMENDMENT: Except as otherwise expressly provided herein, no amendment,
modification or discharge of this Agreement, and no waiver hereunder,
shall be valid or binding unless
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set forth in writing and duly executed by the Party against whom
enforcement of the amendment, modification, discharge or waiver is
sought. Any such waiver shall constitute a waiver only with respect to
the specific matter described in such writing and shall in no way impair
the rights of the Party granting such waiver in any other respect or at
any other time. Neither the waiver by any of the Parties of a breach of
or a default under any of the provisions of this Agreement, nor the
failure by any of the Parties, on one or more occasions, to enforce any
of the provisions of this Agreement or to exercise any right or privilege
hereunder, shall be construed as a waiver of any other breach or default
of a similar nature, or as a waiver of any of such provisions, rights or
privileges hereunder.
10.8. COUNTERPARTS: The Parties may execute this Agreement in separate
counterparts (no one of which need contain the signatures of all
Parties), each of which will be an original and all of which together
will constitute one and the same instrument.
10.9. ASSIGNMENT: This Agreement shall not be assignable or otherwise
transferable by any Party without the prior written consent of the others
Parties hereto.
10.10. GOVERNING LAW: This Agreement shall be governed by, construed and
enforced in accordance with the laws of Switzerland.
10.11. ARBITRATION: Any dispute, controversy or claim arising out of or in
relation to this Agreement, including the validity, invalidity, breach or
termination thereof, shall be settled by arbitration in accordance with
the Swiss Rules of International Arbitration of the Swiss Xxxxxxxx of
Commerce in force on the date when the Notice of Arbitration is submitted
in accordance with these Rules.
The number of arbitrators shall be one. The seat of the arbitration shall
be in Geneva. The arbitral proceedings shall be conducted in English
language.
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IN WITNESS THEREOF, the Parties hereto have caused this Agreement to be duly
executed by their respective authorized signatories as of this March 22., 2004.
MANTEIA SA SOLEXA LIMITED
/s/ Xxxxxxxx Xxxx /s/ Nick McCooke
------------------------------ ---------------------------------
Francois Xxxx Xxxx McCooke
Chief Executive Officer
LYNX THERAPEUTICS
/s/ Xxxxx X. Xxxxxxxx
---------------------------------
Xxxxx X. Xxxxxxxx
President and
Chief Executive Officer
