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
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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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EXECUTION COPY - 22 03 2004
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
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