ROSETTA INPHARMATICS, INC.
COMMON STOCK PURCHASE AGREEMENT
This Common Stock Purchase Agreement (this "AGREEMENT") is made as
of June ___, 2000 by and between Rosetta Inpharmatics, Inc., a Delaware
corporation (the "COMPANY"), and Agilent Technologies, Inc., a Delaware
corporation (the "PURCHASER").
RECITALS
WHEREAS, Purchaser desires to purchase from the Company shares of
its Common Stock $.001 par value per share (the "COMMON STOCK") concurrently
with and conditioned upon the closing of the Company's initial public
offering upon the terms and conditions set forth herein; and
WHEREAS, the Company and the Purchaser wish to set forth the terms
and conditions upon which the Company will sell the Common Stock to the
Purchaser;
NOW, THEREFORE, in consideration of the premises and mutual
covenants and conditions contained herein, the Company and the Purchaser
hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF SHARES
1.1 PURCHASE PRICE AND CLOSING. Subject to Section 1.2 hereof, the
Company will issue and sell to the Purchaser and, subject to the terms and
conditions of this Agreement, the Purchaser will purchase from the Company
(the "SALE"), that number of shares of Common Stock (the "SHARES") equal to
the quotient obtained by dividing $10,000,000 by the per-share price to the
public (the "IPO PRICE") of shares of Common Stock in the Company's first
underwritten, firm commitment public offering pursuant to an effective
registration under the Securities Act of 1933, as amended, ("IPO"). The per
share price to Purchaser shall be the IPO Price. The purchase and sale will
take place at a closing (the "CLOSING") to be held on the date, at the
location and simultaneously with the closing of the IPO, subject to the
satisfaction of all of the conditions to the Closing specified in Article II
herein. At the Closing the Company will issue and deliver a certificate
evidencing the Shares to the Purchaser against payment of the full purchase
price therefor by wire transfer of immediately available funds to an account
designated by the Company.
1.2 XXXX-XXXXX-XXXXXX COMPLIANCE. Notwithstanding the above, the
Company shall sell and the Purchaser shall purchase at the Closing only that
number of shares such that Purchaser's Pro Rata Percentage (as defined below)
immediately prior to the Sale is equal to, or below, Purchaser's Pro Rata
Percentage after the Sale. Purchaser's Pro Rata Percentage shall equal the
percentage of voting securities of the Company held by the Purchaser
determined in accordance with 16 C.F.R. 801.12(b) at the time such
calculation is performed. The Company shall issue Purchaser and Purchaser
shall accept a convertible promissory note in the form attached hereto as
EXHIBIT A (the "NOTE") in an amount equal to the difference between
$10,000,000 and the number of Shares actually issued to Purchaser at the
Closing as a result of the foregoing sentence. Such promissory note shall be
converted immediately following receipt of clearance from the United States
Department of Justice ("DOJ") and the United States Federal Trade Commission
("FTC"), or upon the expiration of the applicable waiting period, under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended (the "HSR
ACT"). If the Note is issued, the parties hereby agree to diligently file all
requisite documents and notifications pursuant to the HSR
Act to enable conversion of the Note; PROVIDED, HOWEVER that if the Note is
issued in an amount less than $50,000, the parties shall file such documents
and notifications pursuant to the HSR Act only at Purchaser's request. If
Purchaser does not so request, the Note shall be payable in cash according to
its terms.
1.3 RESTRICTIONS ON TRANSFER. The Purchaser shall execute and
deliver to Xxxxxx Brothers, Inc. a lock-up letter agreement in substantially
the form attached hereto as EXHIBIT B.
1.4 REPRESENTATIONS AND WARRANTIES BY THE PURCHASER. The Purchaser
represents and warrants to the Company that (a) it is an "accredited
investor" as defined in Rule 501(a) under the Securities Act of 1933, as
amended; (b) it will acquire the Shares for its own account, for the purpose
of investment and not with a view to distribution or resale thereof; (c) the
execution of this Agreement and the consummation of the transactions
contemplated hereby have been duly authorized by all necessary action on the
part of the Purchaser, and this Agreement has been duly executed and
delivered, and constitutes a valid, legal, binding and enforceable agreement
of the Purchaser, except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting
enforcement of creditors' rights generally and (ii) as limited by laws
relating to the availability of specific performance, injunctive relief or
other equitable remedies; (d) it has taken no action which would give rise to
any claim by any other person for any brokerage commissions, finders' fees or
the like relating to this Agreement or the transactions contemplated hereby;
(e) it has had the opportunity to ask questions of and receive answers from
representatives of the Company concerning the terms of the offering of the
Shares and to obtain additional information concerning the Company and its
business; and (f) it has received and reviewed the registration statement on
Form S-1 (Registration No. 333-32780) filed by the Company with the
Securities and Exchange Commission ("COMMISSION") on March 17, 2000 and all
amendments thereto (collectively, the "REGISTRATION STATEMENT") and has all
of the information necessary for it to evaluate the merits and risks of an
investment in the Shares and can bear the economic risks of such investment.
The acquisition by the Purchaser of the Shares shall constitute a
confirmation of the representations and warranties made by the Purchaser as
of the Closing. The Purchaser further represents that if understands and
agrees that, until registered under the Securities Act or transferred
pursuant to the provisions of Rule 144 as promulgated by the Commission, all
certificates evidencing any of the Shares, whether upon initial issuance or
upon any transfer thereof, shall bear a legend, prominently stamped or
printed thereon, reading substantially as follows:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES MAY NOT BE
SOLD, MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED
WITHOUT AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE
STATE SECURITIES LAWS, OR THE AVAILABILITY OF AN EXEMPTION FROM
THE REGISTRATION PROVISIONS OF THE SECURITIES ACT OF 1933, AS
AMENDED, AND APPLICABLE STATE SECURITIES LAWS."
ARTICLE II
CONDITIONS TO CLOSING
2.1 CONDITIONS OF THE PURCHASER'S OBLIGATION. The obligation of
the Purchaser to purchase and pay for the Shares at the Closing is subject to
the satisfaction of the following conditions:
(a) DOCUMENTATION AT CLOSING. The Purchaser shall have received
prior to or at the Closing all of the following documents or instruments, or
evidence of completion thereof, each in form and substance satisfactory to
the Purchaser:
(i) A copy of the Certificate of Incorporation of the
Company, certified by the Secretary of State of the State of Delaware, a copy
of the resolutions of the Board of Directors of the Company evidencing the
approval of this Agreement, the issuance of the Shares and the other matters
contemplated hereby, and a copy of the By-laws of the Company, all of which
shall have been certified by the Secretary of the Company to be true,
complete and correct in every particular, and certified copies of all
documents evidencing other necessary corporate or other action and
governmental approvals, if any, with respect to this Agreement and the Shares.
(ii) The opinion of Venture Law Group, counsel to the
Company, which shall be substantially the same as the opinion delivered to
the underwriters of the IPO pursuant to the underwriting agreement relating
to the IPO (the "UNDERWRITING AGREEMENT"), with such deviations therefrom as
are necessary to reflect the private placement nature of the purchase of the
Shares, including an opinion that the Shares have been duly authorized and
validly issued and are outstanding as fully paid and non-assessable shares of
the Company.
(iii) A certificate of the Secretary of the Company which
shall certify the names of the officers of the Company authorized to sign
this Agreement, the certificate for the Shares and the other documents,
instruments or certificates to be delivered pursuant to this Agreement by the
Company or any of its officers, together with the true signatures of such
officers. The Purchaser may conclusively rely on such certificate until it
shall receive a further certificate of the Secretary or an Assistant
Secretary of the Company canceling or amending the prior certificate and
submitting the signatures of the officers named in such further certificate.
(iv) A certificate of the President of the Company stating
that all covenants and conditions required to be performed prior to or at the
Closing have been performed as of the Closing.
(v) Certificates of Good Standing and Existence for the
Company from the Secretary of State of the State of Delaware.
(b) PERFORMANCE. The Company shall have performed and complied
with all agreements, obligations and conditions contained in this Agreement
that are required to be performed or complied with by it on or before the
Closing.
(c) CONSENTS, WAIVERS, ETC. The Company shall have obtained all
consents or waivers, if any, necessary to execute and deliver this Agreement,
issue the Shares and to carry out the transactions contemplated hereby and
thereby. All corporate and other action and governmental filings necessary
to effectuate the terms of this Agreement, the Shares and other agreements
and instruments executed and delivered by the Company in connection herewith
shall have been made or taken, except for any post-sale filing that may be
required under federal or state securities laws. In addition to the
documents set forth above, the Company shall have provided to the Purchaser
any other information or copies of documents that it may reasonably request.
(d) INVESTORS' RIGHTS AGREEMENT. The Company's Amended and
Restated Investors' Rights Agreement dated as of March 15, 2000 (the "RIGHTS
AGREEMENT") shall have been amended to include the Purchaser as a party such
that the Purchaser is entitled to registration and other rights under
the Rights Agreement with respect to the Shares as though the Purchaser were
an Investor (as defined in the Rights Agreement) and the Shares were
Registrable Securities (as defined in the Rights Agreement).
2.2 CONDITIONS OF THE COMPANY'S OBLIGATION. The obligation of
the Company to sell the Shares at the Closing is subject to the satisfaction
of the following conditions:
(a) COMPLETED IPO. The closing of the IPO shall have
occurred within 90 days of the date hereof.
(b) CONSENTS, WAIVERS, ETC. The Company shall have
obtained all consents or waivers, if any, necessary to execute and deliver
this Agreement, issue the Shares and to carry out the transactions
contemplated hereby and thereby. All corporate and other action and
governmental filings necessary to effectuate the terms of this Agreement, the
Shares and other agreements and instruments executed and delivered by the
Company in connection herewith shall have been made or taken, except for any
post-sale filing that may be required under federal or state securities laws.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to the Purchaser as follows:
3.1 CORPORATE ACTION. The Company has all necessary corporate
power and has taken all corporate action required to enter into and perform
this Agreement and any other agreements and instruments executed in connection
herewith (collectively, the "FINANCING DOCUMENTS"). The Financing Documents
are valid and legally binding obligations of the Company, enforceable in
accordance with their terms. The issuance, sale and delivery of the Shares
in accordance with this Agreement have been duly authorized by all necessary
corporate action on the part of the Company. The issuance of the Shares is
not subject to preemptive rights or other preferential rights in any present
stockholders of the Company that have not been waived and will not conflict
with any provision of any agreement or instrument to which the Company is a
party or by which it or its property is bound and to which the Company has
not obtained appropriate waivers.
3.2 NO CONFLICT. The execution and delivery of this Agreement
by the Company does not, and the consummation of the transactions
contemplated hereby will not, conflict with, or result in any violation of,
or default under (with or without notice or lapse of time, or both), or give
rise to a right of termination, cancellation, modification or acceleration
of any obligation under (i) any provision of the Certificate of
Incorporation of the Company and Bylaws of the Company, (ii) any mortgage,
indenture, lease, contract or other agreement or instrument, permit,
concession, or license to which the Company or any of its properties or
assets is subject or (iii) any judgment, order, decree, applicable to the
Company or its properties or assets.
3.3 STATUS OF SHARES. The Shares, when issued and delivered in
accordance with the terms hereof and after payment of the purchase price
therefor, will be duly authorized, validly issued, fully-paid and
non-assessable, issued in compliance with applicable state and federal
securities laws and free of restrictions on transfer other than restrictions
on transfer under this Agreement and applicable state and federal securities
laws.
3.4 ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company is a
corporation duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation and has all requisite corporate
power and authority to carry on its business.
3.5 REGISTRATION STATEMENT. The Registration Statement, when and if
it is declared effective by the Securities and Exchange Commission, (a) will
not contain any untrue statement of a material fact required to be stated
therein or necessary to make the statements therein not misleading in light
of the circumstances under which they will be made and (b) will comply in all
material respects with the requirements of the Securities Act of 1933, as
amended (the "SECURITIES ACT"), and the rules and regulations promulgated
thereunder.
3.6 CAPITALIZATION. The capitalization of the Company set forth in
the Registration Statement is, and as of the effective date of the
Registration Statement will be, accurate in all material respects.
3.7 PREEMPTIVE RIGHTS. The issuance of the Shares will not be
subject to any preemptive rights, rights of first refusal or similar rights.
ARTICLE IV
OTHER AGREEMENTS
4.1 PUBLICITY. The parties may, subject to compliance with the
Securities Act, issue a joint press release announcing this Agreement and
the transactions contemplated hereby following execution of this Agreement.
Any proposed announcement, press release or other public disclosure concerning
this Agreement and/or any of the transactions or relationships contemplated
hereby shall be mutually approved by both parties (which approval shall not
be unreasonably withheld). The Purchaser agrees and acknowledges that this
Agreement and the transactions contemplated hereby shall be disclosed in
the Registration Statement and filed as an exhibit to the first amendment to
the Registration Statement following execution hereof.
ARTICLE V
MISCELLANEOUS
5.1 NO WAIVER. No failure or delay on the part of any party to this
Agreement in exercising any right, power or remedy hereunder shall operate as
a waiver thereof; nor shall any single or partial exercise of any such right,
power or remedy preclude any other or further exercise thereof or the exercise
of any other right, power or remedy hereunder.
5.2 AMENDMENTS, WAIVERS AND CONSENTS. Any provision in this
Agreement to the contrary notwithstanding, and except as hereinafter
provided, changes in or additions to this Agreement may be made, and
compliance with any covenant or provision set forth herein may be omitted or
waived, if the party requesting such change, addition, omission or waiver
shall obtain consent thereto in writing from the other party. Any waiver or
consent may be given subject to satisfaction of conditions stated therein and
any waiver or consent shall be effective only in the specific instance and
for the specific purpose for which given.
5.3 ADDRESSES FOR NOTICES. All notices, requests, demands and other
communications provided for hereunder shall be in writing and mailed, faxed or
delivered to each applicable party at the address set forth below or at such
other address as to which such party may inform the other parties in writing
in compliance with the terms of this Section.
If to the Purchaser: Agilent Technologies, Inc., 000 Xxxx Xxxx Xxxx, XX
X0-00, Xxxx Xxxx, Xxxxxxxxxx 00000, Fax: (000)000-0000, Attention General
Counsel, with a copy to: Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, 000 Xxxx Xxxx
Xxxx, Xxxx Xxxx, XX 00000, Attention: Xxxxx Xxxxxx; or at such other address
as shall be designated by the Purchaser in a written notice to the Company
complying as to delivery with the terms hereof.
If to the Company: Rosetta Inpharmatics, Inc., 00000 000xx Xxx. X.X.,
Xxxxxxxx, XX 00000, Attention: Xxxx Xxxxxxx, Fax: (000) 000-0000 with a copy
to: Venture Law Group, 0000 Xxxxxxxx Xxxxx, Xxxxxxxx, XX 00000, Fax: (425)
000-0000, Attention: Xxxx X. Xxxxxxxx; or at such other address as shall be
designated by the Company in a written notice to the Purchaser complying as
to delivery with the terms hereof.
All such notices, requests, demands and other communications shall, when
mailed (which mailing must be accomplished by first class mail, postage
prepaid; express overnight courier service; or registered mail, return
receipt requested) or transmitted by facsimile, be effective three days after
deposited in the mails or upon transmission by facsimile, respectively,
addressed as aforesaid, unless otherwise provided herein.
5.4 BINDING EFFECT; ASSIGNMENT. This Agreement shall be binding
upon and inure to the benefit of the Company and the Purchaser and their
respective heirs, successors and assigns, except that the Purchaser shall not
have the right to assign its rights hereunder or any interest herein without
the prior written consent of the Company.
5.5 ENTIRE AGREEMENT. This Agreement and the documents referred to
herein constitute the entire agreement between the parties and supersede any
prior understandings or agreements concerning the subject matter hereof.
5.6 SEVERABILITY. The provisions of this Agreement are severable
and, in the event that any court of competent jurisdiction shall determine
that any one or more of the provisions or part of a provision contained in
this Agreement shall, for any reason, be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision or part of a
provision of this Agreement; but this Agreement, shall be reformed and
construed as if such invalid or illegal or unenforceable provision, or part
of a provision, had never been contained herein, and such provisions or part
reformed so that it would be valid, legal and enforceable to the maximum
extent possible.
5.7 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Washington
without regard to its conflicts of laws principles to the contrary.
5.8 HEADINGS. Article, Section and subsection headings in this
Agreement are included herein for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose.
5.9 COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be enforceable against the party actually executing the
counterpart, and all of which together shall constitute one instrument.
[ REMAINDER OF PAGE INTENTIONALLY LEFT BLANK ]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
ROSETTA INPHARMATICS, INC.
By:
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Name:
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Title:
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AGILENT TECHNOLOGIES, INC.
By:
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Name:
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Title:
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EXHIBIT A
FORM OF CONVERTIBLE PROMISSORY NOTE
EXHIBIT B
LOCK-UP LETTER AGREEMENT
XXXXXX BROTHERS INC.
As Representative of the
several underwriters
c/x XXXXXX BROTHERS INC.
Three World Financial Center
Xxx Xxxx, XX 00000
Dear Sirs:
The undersigned understands that you and certain other firms propose to
enter into an Underwriting Agreement (the "Underwriting Agreement") providing
for the purchase by you and such other firms (the "Underwriters") of shares
(the "Shares") of Common Stock, par value $.001 per share (the "Common
Stock"), of Rosetta Inpharmatics, Inc. (the "Company") and that the
Underwriters propose to reoffer the Shares to the public (the "Offering").
In consideration of the execution of the Underwriting Agreement by the
Underwriters, and for other good and valuable consideration, the undersigned
hereby irrevocably agrees that, without the prior written consent of Xxxxxx
Brothers Inc., the undersigned will not, directly or indirectly, (1) offer for
sale, sell, pledge, or otherwise dispose of (or enter into any transaction or
device that is designed to, or could be expected to, result in the
disposition by any person at any time in the future of) any shares of Common
Stock (including, without limitation, shares of Common Stock that may be
deemed to be beneficially owned by the undersigned in accordance with the
rules and regulations of the Securities and Exchange Commission and shares of
Common Stock that may be issued upon exercise of any option or warrant) or
securities convertible into or exchangeable for Common Stock (other than the
Shares) owned by the undersigned on the date of execution of this Lock-Up
Letter Agreement or on the date of the completion of the Offering, or (2)
enter into any swap or other derivatives transaction that transfers to
another, in whole or in part, any of the economic benefits or risks of
ownership of such shares of Common Stock, whether any such transaction
described in clause (1) or (2) above is to be settled by delivery of Common
Stock or other securities, in cash or otherwise, for a period of 180 days
after the date of the final prospectus relating to the Offering.
In furtherance of the foregoing, the Company and its Transfer Agent are
hereby authorized to decline to make any transfer of securities if such
transfer would constitute a violation or breach of this Lock-Up Letter
Agreement.
Notwithstanding the foregoing, if the undersigned is an individual, he
may transfer any or all of the shares subject to this agreement either during
his or her lifetime or on death by gift, will or intestate succession to his
or her immediate family or to a trust the beneficiaries of which are
exclusively the undersigned and/or a member or members of his or her
immediate family; and if the undersigned is a partnership, the partnership
may transfer any of the shares subject to this agreement to a partner of such
partnership who is an individual and who retires after the date hereof, or to
the estate of any such individual retired partner, and any partner who is an
individual may transfer the shares subject to this agreement by gift, will or
intestate succession to his or her immediate family; PROVIDED, HOWEVER,
that in any such case it shall be a condition to the transfer that the
transferor provide written notice to Xxxxxx Brothers Inc. in advance of any
such transfer and that the transferee execute an agreement stating that the
transferee is receiving and holding the shares subject to the provisions of
this agreement, and there shall be no further transfer of such shares except
in accordance with this agreement.
It is understood that, if the Company notifies the undersigned that it
does not intend to proceed with the Offering, if the Underwriting Agreement
does not become effective, or if the Underwriting Agreement (other than the
provisions thereof which survive termination) shall terminate or be terminated
prior to payment for and delivery of the Shares, the undersigned will be
released from the undersigned's obligations under this Lock-Up Letter
Agreement.
The undersigned understands that the Company and the Underwriters will
proceed with the Offering in reliance on this Lock-Up Letter Agreement.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to enter into this Lock-Up Letter Agreement and
that, upon request, the undersigned will execute any additional documents
necessary in connection with the enforcement hereof. Any obligations of the
undersigned shall be binding upon the heirs, personal representatives,
successors and assigns of the undersigned.
This agreement shall lapse and become null and void if the Offering is
not completed on or before August 31, 2000.
Very truly yours,
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(Print Name of Security Holder)
By:
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(Signature of Security Holder)
Title (if appropriate):
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Dated:
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