EXHIBIT 4.1
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COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT (the "AGREEMENT") is made and
entered into as of March 5, 2002, by and between Geron Corporation, a Delaware
corporation having its principal place of business at 000 Xxxxxxxxxxxx Xxxxx,
Xxxxx Xxxx, Xxxxxxxxxx 00000 (the "COMPANY"), and Lynx Therapeutics, Inc., a
Delaware corporation having its principal place of business at 00000 Xxxxxxxxxx
Xxxxxxxxx, Xxxxxxx, XX 00000 (the "ACQUIRER").
A. The Company has agreed to issue 210,000 shares of the Company's
common stock, par value $.001 per share (the "COMMON STOCK") to
Acquirer pursuant to that certain Purchase Agreement between the
Company and Acquirer dated as of March 5, 2002 (the "PURCHASE
AGREEMENT").
B. The Acquirer and the Company desire to specify the terms and
conditions of the Company's issuance of such common stock.
THE PARTIES AGREE AS FOLLOWS:
1. ISSUANCE OF SHARES; PURCHASE PRICE. The Acquirer hereby acquires and the
Company hereby issues to Acquirer 210,000 shares (the "SHARES") of
Common Stock in consideration of the license granted pursuant to that
certain License Agreement between the Company and the Acquirer dated as
of March 5, 2002.
2. CLOSING; DELIVERY. The consummation of the transaction contemplated by
this Agreement (the "CLOSING") shall be held on the date hereof
("CLOSING DATE"). The Closing shall be held at the offices of the
Company or at such other time or place as Acquirer and the Company may
mutually agree. At the Closing, the Company shall deliver to the
Acquirer a stock certificate, in the name of the Acquirer, representing
the Shares against delivery of the Patent Assignment (as defined in the
Purchase Agreement).
3. CLOSING CONDITIONS.
3.1 The Company's respective obligations to issue and deliver the
stock certificate representing the Shares to the Acquirer shall
be subject to the following condition, which may be waived by
the Company:
3.1.1 the execution of the Purchase Agreement; and
3.1.2 the accuracy of the representations and warranties made by the
Acquirer shall be true and correct in all material respects as
of the Closing Date.
3.2 The Acquirer's obligation to accept delivery of the stock certificate
representing the Shares shall be subject to the following conditions,
any one or more of which may be waived the Acquirer:
3.2.1 the execution of the Purchase Agreement;
3.2.2 the covenants and obligations that the Company is required to
perform or to comply with pursuant to this Agreement, at or
prior to the Closing, must have been duly performed and complied
with in all material respects;
3.2.3 the Company shall have available under its Certificate of
Incorporation sufficient authorized shares of capital stock to
issue and sell the Shares to Acquirer; and
3.2.4 the accuracy of the representations and warranties made by the
Company shall be true and correct in all material respects as of
the Closing Date.
4. RESTRICTIONS ON RESALE OF SHARES.
4.1 Legends. The Acquirer understands and acknowledges that the Shares are
not registered under the Securities Act of 1933 (the "ACT") and that
under the Act and other applicable laws the Acquirer may be required to
hold such Shares for an indefinite period of time. Each stock
certificate representing Shares shall bear the following legends:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). ANY TRANSFER OF SUCH
SECURITIES SHALL BE INVALID UNLESS A REGISTRATION STATEMENT UNDER THE
ACT IS IN EFFECT AS TO SUCH TRANSFER OR, IN THE OPINION OF COUNSEL
REASONABLY ACCEPTABLE TO THE COMPANY, SUCH REGISTRATION IS UNNECESSARY
FOR SUCH TRANSFER TO COMPLY WITH THE ACT.
THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO THE TERMS OF THE COMMON
STOCK PURCHASE AGREEMENT, DATED MARCH 5, 2002. A COPY OF THE AGREEMENT
CAN BE OBTAINED FROM THE SECRETARY OF THE COMPANY."
5. REGISTRATION RIGHTS
5.1 The Company agrees to prepare and file with the Securities and Exchange
Commission ("COMMISSION"), on or before March 8, 2002, a registration
statement under the Act (the "REGISTRATION STATEMENT"), on Form S-3 or
other appropriate form, so as to permit a non-underwritten public
offering and resale of
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the Shares under the Act by the Acquirer. The Company agrees to
diligently pursue making that registration statement effective as soon
as practicable following the execution of this Agreement. The Company
will notify the Acquirer of the effectiveness of the Registration
Statement within one business day of receiving notice from the
Commission.
5.2 The Company will prepare and file with the Commission such amendments
and supplements to the Registration Statement and the prospectus as may
be necessary to keep the Registration Statement or post-effective
amendment filed under this Section 5 effective under the Act until the
earlier of (i) the date that none of the Shares covered by such
Registration Statement are outstanding, (ii) the date that all of the
Shares have been sold pursuant to such Registration Statement, (iii) the
date the Acquirer receives an opinion of counsel to the Company, which
counsel shall be reasonably acceptable to the Acquirer, that the Shares
may be sold under the provisions of Rule 144 without limitation as to
volume, (iv) the date that all Shares have been otherwise transferred to
persons who may trade such shares without restriction under the Act, and
the Company has delivered a new certificate or other evidence of
ownership for such securities not bearing a restrictive legend, or (v)
the date all Shares may be sold at any time, without volume or manner of
sale limitations pursuant to Rule 144(k) or any similar provision then
in effect under the Act in the opinion of counsel to the Company, which
counsel shall be reasonably acceptable to the Acquirer (the
"EFFECTIVENESS PERIOD").
5.3 The Company shall furnish to the Acquirer with respect to the Shares
registered under the Registration Statement such reasonable number of
copies of the Registration Statement, prospectuses and preliminary
prospectuses in conformity with the requirements of the Act and such
other documents as the Acquirer may reasonably request, in order to
facilitate the public sale or other disposition of all or any of the
Shares by the Acquirer, provided, however, that the obligation of the
Company to deliver copies of prospectuses or preliminary prospectuses to
the Acquirer shall be subject to the receipt by the Company of
reasonable assurances from the Acquirer that the Acquirer will comply
with the applicable provisions of the Act and of such other securities
or blue sky laws as may be applicable in connection with any use of such
prospectuses or preliminary prospectuses.
5.4 All fees, disbursements and out-of-pocket expenses and costs incurred by
the Company in connection with the preparation and filing of the
Registration Statement and any post-effective amendments thereto under
this Section 5 and in complying with applicable securities and Blue Sky
laws (including, without limitation, all attorneys' fees of the Company)
shall be borne by the Company. The Acquirer shall bear the cost of
underwriting and/or brokerage discounts, fees and commissions, if any,
applicable to the Shares being registered and the fees and expenses of
their counsel. The Company at its expense will supply the Acquirer with
copies of the applicable Registration Statement and the prospectus
included therein and other related documents in such quantities as may
be reasonably requested by the Acquirer.
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5.5 The Company will advise the Acquirer, promptly after it shall receive
notice or obtain knowledge of the issuance of any stop order by the
Commission delaying or suspending the effectiveness of the Registration
Statement or of the initiation of any proceeding for that purpose, that
the Company will use its commercially reasonable efforts to prevent the
issuance of any stop order or to obtain its withdrawal at the earliest
possible moment if such stop order should be issued.
5.6 With a view to making available to the Acquirer the benefits of Rule 144
(or its successor rule) and any other rule or regulation of the
Commission that may at any time permit the Acquirer to sell the
Securities to the public without registration, the Company covenants and
agrees to: (i) make and keep public information available, as those
terms are understood and defined in Rule 144, until the earlier of (A)
such date as all of the Shares may be resold pursuant to Rule 144(k) or
any other rule of similar effect or (B) such date as all of the Shares
shall have been resold; and (ii) file with the Commission in a timely
manner all reports and other documents required of the Company under the
Act and under the Exchange Act of 1934, as amended.
5.7 The Acquirer will cooperate with the Company in all respects in
connection with this Agreement, including timely supplying all
information reasonably requested by the Company (which shall include all
information regarding the Acquirer and proposed manner of sale of the
Shares required to be disclosed in any Registration Statement) and
executing and returning all documents reasonably requested in connection
with the registration and sale of the Shares and entering into and
performing their obligations under any underwriting agreement, if the
offering is an underwritten offering, in usual and customary form, with
the managing underwriter or underwriters of such underwritten offering.
Nothing in this Agreement shall obligate the Acquirer to consent to be
named as an underwriter in any Registration Statement.
5.8 If the Registration Statement has not been declared effective by the
Commission on or before April 30, 2002 (the "OPTION DATE"), then the
Acquirer shall have the option to return for cancellation (the
"CANCELLATION OPTION") all of the Shares to the Company. As
consideration for the return of the Shares to the Company for
cancellation, the Company shall pay to Acquirer an amount equal to One
Million Five Hundred Thousand Dollars ($1,500,000), payable in
immediately available funds. The Acquirer shall not be required to make
any representations or warranties with respect to the Shares, except
with respect to its ownership of the Shares. At anytime following the
Option Date, the Acquirer may exercise the Cancellation Option by
delivering written notice to the Company that states that it has elected
to exercise the Cancellation Option (the "CANCELLATION OPTION EXERCISE
NOTICE"). If the Cancellation Option Notice is not received by the
Company within thirty (30) days following the Option Date, then the
Cancellation Option shall expire and be of no further force or effect.
This Cancellation Option shall not be enforceable by any transferee of
the Shares held by the Acquirer.
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6. INDEMNIFICATION.
For the purpose of this Section 6:
the term "REGISTRATION STATEMENT" shall include any final prospectus, exhibit,
supplement or amendment included in or relating to the Registration Statement
referred to in Section 5.1; and the term "UNTRUE STATEMENT" shall include any
untrue statement or alleged untrue statement, or any omission or alleged
omission to state in the Registration Statement 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.
6.1 The Company agrees to indemnify and hold harmless the Acquirer from and
against any losses, claims, damages or liabilities to which the Acquirer
may become subject (under the Act or otherwise) insofar as such losses,
claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of, or are based upon (i) any untrue statement of a
material fact contained in the Registration Statement, (ii) any omission
of a material fact required to be stated in the Registration Statement
or necessary in order to make the statements in the Registration
Statement not misleading or (iii) any failure by the Company to fulfill
any undertaking included in the Registration Statement, and the Company
will reimburse the Acquirer for any reasonable legal or other expenses
reasonably incurred in investigating, defending or preparing to defend
any such action, proceeding or claim, provided, however, that the
Company shall not be liable in any such case to the extent that such
loss, claim, damage or liability arises out of, or is based upon, an
untrue statement made in such Registration Statement in reliance upon
and in conformity with written information furnished to the Company by
or on behalf of the Acquirer specifically for use in preparation of the
Registration Statement or the failure of the Acquirer to comply with its
covenants and agreements contained in Sections 8.1 or 8.5.2 hereof or
any misstatement or omission in any prospectus that is corrected in any
subsequent prospectus that was delivered to the Acquirer prior to the
pertinent sale or sales by the Acquirer.
6.2 The Acquirer agrees to indemnify and hold harmless the Company (and each
person, if any, who controls the Company within the meaning of Section
15 of the Act, each officer of the Company who signs the Registration
Statement and each director of the Company) from and against any losses,
claims, damages or liabilities to which the Company (or any such
officer, director or controlling person) may become subject (under the
Act or otherwise), insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of,
or are based upon, (i) any failure to comply with the covenants and
agreements contained in Sections 8.1 or 8.5.2 hereof or (ii) any untrue
statement of a material fact contained in the Registration Statement or
any omission of a material fact required to be stated in the
Registration Statement or necessary in order to make the statements in
the Registration Statement not misleading if such untrue statement or
omission was made in reliance upon and in conformity with written
information furnished to the Company by or on behalf of the Acquirer
specifically for use in preparation of the Registration Statement, and
the Acquirer
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will reimburse the Company (or such officer, director or controlling
person), as the case may be, for any legal or other expenses reasonably
incurred in investigating, defending or preparing to defend any such
action, proceeding or claim; provided, however, that the Acquirer shall
not be liable in any such case for (A) any untrue statement or omission
in the Registration Statement, prospectus, or other such document which
statement is corrected by the Acquirer and delivered to the Company
prior to the sale from which such loss occurred, (B) any untrue
statement or omission in any prospectus which is corrected by the
Acquirer in any subsequent prospectus, or supplement or amendment
thereto, and delivered to the Company prior to the sale or sales from
which a loss or liability arose, or (C) any failure by the Company to
fulfill any of its obligations under Section 6.1 hereof.
6.3 Promptly after receipt by any indemnified person of a notice of a claim
or the beginning of any action in respect of which indemnity is to be
sought against an indemnifying person pursuant to this Section 6, such
indemnified person shall notify the indemnifying person in writing of
such claim or of the commencement of such action, but the omission to so
notify the indemnifying party will not relieve it from any liability
which it may have to any indemnified party under this Section 6 (except
to the extent that such omission materially and adversely affects the
indemnifying party's ability to defend such action) or from any
liability otherwise than under this Section 6. Subject to the provisions
hereinafter stated, in case any such action shall be brought against an
indemnified person, the indemnifying person shall be entitled to
participate therein, and, to the extent that it shall elect by written
notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, shall be entitled to
assume the defense thereof, with counsel reasonably satisfactory to such
indemnified person. After notice from the indemnifying person to such
indemnified person of its election to assume the defense thereof, such
indemnifying person shall not be liable to such indemnified person for
any legal expenses subsequently incurred by such indemnified person in
connection with the defense thereof, provided, however, that if there
exists or shall exist a conflict of interest that would make it
inappropriate, in the reasonable opinion of counsel to the indemnified
person, for the same counsel to represent both the indemnified person
and such indemnifying person or any affiliate or associate thereof, the
indemnified person shall be entitled to retain its own counsel at the
expense of such indemnifying person; provided, however, that no
indemnifying person shall be responsible for the fees and expenses of
more than one separate counsel (together with appropriate local counsel)
for all indemnified parties. In no event shall any indemnifying person
be liable in respect of any amounts paid in settlement of any action
unless the indemnifying person shall have approved the terms of such
settlement. No indemnifying person shall, without the prior written
consent of the indemnified person, effect any settlement of any pending
or threatened proceeding in respect of which any indemnified person is
or could have been a party and indemnification could have been sought
hereunder by such indemnified person, unless such settlement includes an
unconditional release of such indemnified person from all liability on
claims that are the subject matter of such proceeding.
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7. REPRESENTATIONS AND ACKNOWLEDGMENTS OF THE COMPANY.
The Company hereby represents, warrants and covenants to the Acquirer as
follows:
7.1 Organization, Good Standing and Qualification. The Company is a
corporation duly organized, validly existing and in good standing under
the laws of the State of Delaware and has all requisite corporate power
and authority to carry on its business as now conducted and as presently
proposed to be conducted. The Company is duly qualified to transact
business and is in good standing as a foreign corporation in each
jurisdiction in which the failure to so qualify would have a material
adverse effect on its business or properties.
7.2 Authorization. All corporate action on the part of Company, its
officers, directors and stockholders necessary for the authorization,
execution and delivery of this Agreement, the performance of all
obligations of Company hereunder and the authorization, issuance and
delivery of the Shares has been taken or will be taken prior to the
Closing, and this Agreement, when executed and delivered will constitute
valid and legally binding obligations of the Company, enforceable
against the Company in accordance with their terms, except as limited by
applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance and other laws of general application affecting
enforcement of creditors' rights generally, as limited by laws relating
to the availability of specific performance, injunctive relief or other
equitable remedies.
7.3 Valid Issuance of Common Stock. The Shares that are being purchased by
Acquirer hereunder, when issued, sold and delivered in accordance with
the terms hereof for the consideration expressed herein, will be duly
and validly authorized and issued, fully paid and nonassessable and free
of restrictions on transfer other than restrictions on transfer under
this Agreement and applicable state and federal securities laws.
7.4 Legal Proceedings and Orders. There is no action, suit, proceeding or
investigation pending or threatened against the Company that questions
the validity of this Agreement or the right of the Company to enter into
this Agreement or to consummate the transactions contemplated hereby,
nor is the Company aware of any basis for any of the forgoing. The
Company is neither a party nor subject to the provisions of any order,
writ, injunction, judgment or decree of any court or government agency
or instrumentality that would affect the ability of the Company to enter
into this Agreement or to consummate the transactions contemplated
hereby.
8. REPRESENTATIONS AND ACKNOWLEDGMENTS OF THE ACQUIRER.
The Acquirer hereby represents, warrants, acknowledges and agrees that:
8.1 Investment. The Acquirer is acquiring the Shares for the Acquirer's own
account, and not directly or indirectly for the account of any other
person. The Acquirer is acquiring the Shares for investment and not with
a view to distribution or resale
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thereof except in compliance with the Act and any applicable state law
regulating securities.
8.2 Access to Information. Acquirer has consulted with its own attorney,
accountant, or investment advisor as the Acquirer has deemed advisable
with respect to the investment and has determined its suitability for
Acquirer. The Acquirer has had the opportunity to ask questions of, and
to receive answers from, appropriate executive officers of the Company
with respect to the terms and conditions of the transactions
contemplated hereby and with respect to the business, affairs, financial
condition and results of operations of the Company. The Acquirer has had
access to such financial and other information as is necessary in order
for the Acquirer to make a fully informed decision as to investment in
the Company, and has had the opportunity to obtain any additional
information necessary to verify any of such information to which the
Acquirer has had access. Acquirer acknowledges that neither the Company
nor any of its officers, directors, employees, agents, representatives,
or advisors have made any representation or warranty.
8.3 Business and Financial Expertise. The Acquirer further represents and
warrants that it has such business or financial expertise as to be able
to evaluate its investment in the Company and purchase of the Shares.
8.4 Speculative Investment. The Acquirer acknowledges that the investment in
the Company represented by the Shares is highly speculative in nature
and is subject to a high degree of risk of loss in whole or in part; the
amount of such investment is within the Acquirer's risk capital means
and is not so great in relation to the Acquirer's total financial
resources as would jeopardize the personal financial needs of the
Acquirer in the event such investment were lost in whole or in part.
8.5 Unregistered Securities. Acquirer acknowledges that:
8.5.1 The Acquirer must bear the economic risk of investment for an
indefinite period of time because the Shares have not been
registered under the Act and therefore cannot and will not be
sold unless they are subsequently registered under the Act or an
exemption from such registration is available. The Company has
made no agreements, covenants or undertakings whatsoever to
register any of the Shares under the Act, except as provided in
Section 5 above. The Company has made no representations,
warranties or covenants whatsoever as to whether any exemption
from the Act, including, without limitation, any exemption for
limited sales in routine brokers' transactions pursuant to Rule
144 under the Act, will become available and any such exemption
pursuant to Rule 144, if available at all, will not be available
unless: (i) a public trading market then exists in the Company's
common stock, (ii) the Company has complied with the information
requirements of Rule 144, and (iii) all other terms and
conditions of Rule 144 have been satisfied.
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8.5.2 Transfer of the Shares has not been registered or qualified
under any applicable state law regulating securities and,
therefore, the Shares cannot and will not be sold unless they
are subsequently registered or qualified under any such act or
an exemption therefrom is available. The Company has made no
agreements, covenants or undertakings whatsoever to register or
qualify any of the Shares under any such act, except as provided
in Section 5 above. The Company has made no representations,
warranties or covenants whatsoever as to whether any exemption
from any such act will become available.
8.5.3 The Acquirer hereby certifies that it is an "accredited
investor" as that term is defined in Rule 501 under the Act.
9. TAX ADVICE. The Acquirer acknowledges that the Acquirer has not relied
and will not rely upon the Company or the Company's counsel with respect
to any tax consequences related to the ownership, purchase, or
disposition of the shares. The Acquirer assumes full responsibility for
all such consequences and for the preparation and filing of all tax
returns and elections which may or must be filed in connection with such
shares.
10. NOTICES. Any notice or other communication required or permitted
hereunder shall be in writing and shall be deemed to have been duly
given on the date of service if served personally or five days, not
including Saturdays, Sundays, or national holidays, after mailing if
mailed by first class United States mail, certified or registered with
return receipt requested, postage prepaid, and addressed as follows:
To the Company at: Geron Corporation
000 Xxxxxxxxxxxx Xxxxx
Xxxxx Xxxx, Xxxxxxxxxx 00000
Attention: Chief Financial Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
To the Acquirer at: Lynx Therapeutics, Inc.
00000 Xxxxxxxxxx Xxxxxxxxx
Xxxxxxx, XX 00000
Attention: Chief Financial Officer
Telephone: (000)000-0000
Facsimile: (000)000-0000
11. BINDING EFFECT. This Agreement shall be binding upon the heirs, legal
representatives and successors of the Company and of the Acquirer;
provided, however, that the Acquirer may not assign any rights or
obligations under this Agreement. The Company's rights under this
Agreement shall be freely assignable.
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12. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
13. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement of the
parties pertaining to the Shares and supersedes all prior and
contemporaneous agreements, representations, and understandings of the
parties.
IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
Purchase Agreement as of the date first above written.
GERON CORPORATION
/s/ Xxxxx X. Xxxxxxxxx
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By: Xxxxx X. Xxxxxxxxx
Title: Chief Financial Officer and
Senior Vice President,
Corporate Development
LYNX THERAPEUTICS, INC.
/s/ Xxxxxx X.X. Xxxxxxx
---------------------------------------
By: Xxxxxx X.X. Xxxxxxx
Title: President and Chief Executive
Officer
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