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EXHIBIT 2.1
DATED MAY 3, 1999
ROSLIN INSTITUTE AND OTHERS
- and -
GERON CORPORATION
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SALE AND PURCHASE AGREEMENT
- relating to -
the issued share capital of
Roslin Bio-Med Limited
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DX: 41 LONDON
Draft:4: 05/15/99
Ref: SXW/MXR
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INDEX
CLAUSE NO. PAGE NO.
1. DEFINITIONS AND INTERPRETATION.......................... 1
2. SALE AND PURCHASE....................................... 9
3. CONSIDERATION........................................... 10
4. VENDORS' WARRANTIES..................................... 10
5. LIMITATIONS TO THE WARRANTIES........................... 12
6. PURCHASER'S WARRANTIES.................................. 19
7. COMPLETION.............................................. 19
8. COVENANTS OF THE PURCHASER AND THE VENDORS.............. 22
9. RESTRICTIONS............................................ 23
10. CONFIDENTIALITY........................................ 26
11. RESTRICTIVE TRADE PRACTICES ACT........................ 27
12. NOTICES................................................ 27
13. MISCELLANEOUS.......................................... 30
14.WARRANTORS' REPRESENTATIVE.............................. 28
15. LAW AND JURISDICTION................................... 36
SCHEDULES
1. The Vendors and the Consideration Shares
2. The Company
3. The Company IPR
4. Representations and warranties of the Warrantors
5. Conditions to Completion
6. Representations and warranties of the Purchaser
3
THIS AGREEMENT is made the 3rd day of May, 1999
BETWEEN
(1) THE PERSONS whose names and addresses are set out in columns 1 and 2 of
schedule 1 (collectively the "Vendors" and severally a "Vendor"); and
(2) GERON CORPORATION whose place of business is at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ (the "Purchaser").
INTRODUCTION
(A) Roslin Bio-Med Limited is a private company limited by shares
incorporated in Scotland, further details of which are set out in
schedule 2 (the "Company").
(B) The Vendors are the registered shareholders of all of the issued share
capital of the Company in the proportions set out against their names
in column 3 of schedule 1.
(C) Subject to the terms and conditions of this agreement the Vendors have
agreed to sell and the Purchaser has agreed to purchase all of the
issued share capital of the Company.
AGREED TERMS
1. DEFINITIONS AND INTERPRETATION
1.1 In this agreement:
"ACCOUNTING REQUIREMENTS" means the accounting requirements of the
Companies Act, SSAPs, FRSs, abstracts of the Urgent Issues Task Force,
any other requirement of a United Kingdom accounting body having
mandatory effect, FREDs and other generally accepted accounting
principles and practices in the United Kingdom to the extent applicable
and in force in relation to the Company as at the Completion Date;
"ACCOUNTS" means the audited accounts of the Company for the financial
year ended on the Accounts Date including the auditors' and directors'
reports, the audited balance sheet as at the Accounts Date, the audited
profit and loss account for such period and the notes to them;
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"ACCOUNTS DATE" means 28 February 1999;
"AFFILIATE" means, in respect of any person:
(a) any person connected with such person (and "connected with"
bears the meaning set out in section 839 of ICTA); and/or
(b) any company under the control of such person (and "control"
bears the meaning set out in section 840 of ICTA); and/or
(c) any associated company of such person (and "associated
company" bears the meaning set out in section 416 of ICTA);
"BUSINESS DAY" means any day other than a Saturday, Sunday or any day
which is a public holiday in any of the countries referred to in
sub-clause 12.2;
"BUSINESS HOURS" means the hours of 09.00 to 17.30 on a Business Day in
the place to which any notice or other written communication is sent
pursuant to this agreement;
"CAA" means the Capital ▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇;
"COMPANY'S ACCOUNTANTS" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ of ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇;
"COMPANIES ACT" means the Companies ▇▇▇ ▇▇▇▇;
"COMPANY IPR" means:
(a) the patents, applications and supplementary
certificates for patents listed in the Warrantors'
Disclosure Letter and any other patents, applications
and supplementary certificates for patents registered
or applied for in any part of the world in respect of
the same inventions as those patents, applications
and supplementary certificates set out in Part A of
schedule 3 (whether or not claiming priority from any
such patents and/or applications) (together
"PATENTS"); and
(b) the trademarks listed in Part B of schedule 3 and
all other business names, brand names, trade marks
(whether in fancy script or otherwise), devices,
logos, get up and signs (and whether or not
registered or applied for) owned by the Company
together with all goodwill associated with or
symbolised by any of the foregoing (together
"TRADEMARKS");
(c) all ideas, concepts, inventions, unpatented
drawings, designs, models, specifications, data,
formulae, processes and procedures, techniques and
any other technical information or documentation
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(including computer stored information and
documentation) owned or co-owned by or under the
control of the Company which is secret and
substantial ("KNOW-HOW"); and
(d) all database rights;
"COMPLETION" means completion of the sale and purchase of the Sale
Shares in accordance with the parties' respective obligations under
clause 7;
"COMPLETION DATE" means the date of Completion as set out in sub-clause
7.1;
"COMPUTER SYSTEM" means the computer systems, including all its
equipment, hardware, firmware, software and accessories used in the
business of the Company;
"CONDITIONS" means the conditions precedent to Completion contained in
schedule 5;
"CONFIDENTIAL INFORMATION" means all confidential technical, commercial
and other confidential information, know-how, experience, knowledge and
skill relating to the business of the Company as at the Completion Date
including (without prejudice to the generality of the foregoing) all
research and development drawings, formulae, processes, specifications,
trade secrets, test reports, operating and testing procedures,
practices, listings, instruction manuals, tables of operating
conditions, lists and particulars of customers and suppliers, marketing
methods, pricing, credit and payment policies, profit margins,
discounts and rebates (if any);
"CONSIDERATION SHARES" means 2,100,000 ordinary shares in the capital
of the Purchaser's common stock at $0.001 par value to be issued
credited as fully paid, being the 3i Consideration Shares and the
Escrow Shares;
"DAMAGES" means losses, damages, liabilities fees and costs (including
legal costs) and expenses reasonably and properly incurred;
"DISCLOSED" means disclosed with sufficient clarity and detail to
enable the Purchaser to assess the financial and commercial impact on
the Company of the matter disclosed;
"ENCUMBRANCE" means any mortgage, charge, lien, pledge, hypothecation,
assignment by way of security, equity, claim, right of pre-emption,
option, covenant, restriction, reservation, lease, trust, order,
decree, judgment, title defect (including retention of title claim),
valid and enforceable conflicting claim of ownership or any other third
party right or encumbrance of any nature whatsoever (whether or not
perfected);
"ESCROW AGENT" means U.S. Bank Trust National Association or such other
institution selected by unanimous agreement of the Warrantors'
Representative and the Purchaser to act as an escrow agent;
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"ESCROW AGREEMENT" means the escrow agreement in the agreed form;
"ESCROW FUND" means the escrow fund established pursuant to the Escrow
Agreement in respect of the Escrow Shares;
"ESCROW SHARES" means the First Escrow Shares and the Second Escrow
Shares;
"FINANCIAL YEAR" shall be construed in accordance with section 223 of
the Companies Act;
"FIRST ESCROW SHARES" means 860,000 of the Consideration Shares to be
issued to the Warrantors as shown in column 4.2(a) of schedule 1;
"FREDS" means the financial reporting exposure drafts issued by the
Accounting Standards Board Limited;
"FRSS" means the financial reporting standards established by the
Accounting Standards Board Limited;
"GOVERNMENT ENTITY" means any court, administrative agency, commission
or other governmental authority;
"HAZARDOUS MATERIALS" means wastes, pollutants, contaminants,
petroleum, petroleum products, dangerous, hazardous or toxic substances
and materials (including liquids, solids, gases, ions and noise and
substances prescribed in schedules 4, 5 and 6 of the Environmental
Protection (Prescribed Processes and Substances) Regulations 1991)
which may be harmful to human health or other life or the environment
or a nuisance to any person;
"ICTA" means the Income and Corporation Taxes ▇▇▇ ▇▇▇▇;
"IHTA" means the Inheritance Tax ▇▇▇ ▇▇▇▇;
"INTELLECTUAL PROPERTY" means all patents and supplementary
certificates, registered designs, know-how, rights in trade secrets and
confidential information; registered or unregistered trademarks,
service marks and applications therefor and all other business names,
brand names, devices, logos, (and whether or not registered or applied
for) with all the goodwill associated with or symbolised by any of the
foregoing; all other inventions (whether or not capable of protection
by patent or other form of registration); all copyright, rights in the
nature of copyright, sui generis rights, design rights, moral rights
and all other like rights in all parts of the world whether present or
vested future or contingent; all other intellectual property rights
throughout the world for the full term of the rights concerned and
including: all registrations and pending registrations relating to any
such rights and the benefit of any pending applications for any such
registrations; all reversions, extensions and renewals of such rights;
and all accrued rights of action in relation to such rights (including
the right to ▇▇▇ for and recover damages for past infringements);
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"LICENCES" means the licences, agreements, contracts, permissions
listed in part C of schedule 3 being legal arrangements pursuant to
which the Company is entitled to utilise any Intellectual Property
owned by any third party;
"LICENSORS" means the licensors under the Licences;
"LICENCE AGREEMENT" means the licence agreement in the agreed form;
"MATERIAL" means with respect to any event, change, condition or effect
any material event, change, condition or effect related to the
condition (financial or otherwise), properties, assets (including
intangible assets), liabilities, business, operations, results of
operations or prospects of an entity or group of entities;
"MATERIAL ADVERSE EFFECT" means with respect to any entity or group of
entities any event, change or effect that, when taken individually or
together with all other adverse changes and effects, is or is
reasonably likely to be materially adverse to the condition (financial
or otherwise), properties, assets, liabilities, business, operations,
results of or prospects of such entity and its subsidiaries, taken as a
whole, or to prevent or materially delay consummation of the
transactions contemplated under this agreement or otherwise to prevent
such entity and its subsidiaries from performing their obligations
under this agreement;
"NEW SHARES" means any of the Purchaser's shares or other equity issued
or distributed by the Purchaser (including shares issued in a stock
split) which may be issued on or after Completion to the Warrantors in
addition to the Escrow Shares;
"OPTION EXCHANGE AGREEMENT" means the option exchange agreement in the
agreed form;
"OPTION SHARES" means that those shares in the Company over which
options have been granted as set out in column 5 of schedule 1;
"PATENTS ACT" means the Patents ▇▇▇ ▇▇▇▇;
"PURCHASER'S ACCOUNTANTS" means Ernst & Young of ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇;
"PURCHASER'S DISCLOSURE LETTER" means the disclosure letter in the
agreed terms of even date given by the Purchaser to the Vendors;
"PURCHASER'S SOLICITORS" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ of Carmelite, ▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇;
"PURCHASER'S TRANSFER AGENTS" means US Stock Transfer Corporation;
"PURCHASER'S WARRANTIES" means the representations and warranties set
out in schedule 7;
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"REGISTRATION RIGHTS AGREEMENT" means the registration rights agreement
in the agreed form;
"RELEVANT DATE" means:
(a) in the case of the Warrantors other than the Roslin Institute
the Completion Date;
(b) in the case of the Roslin Institute the sixth anniversary of
the Completion Date or if earlier the date upon which the
Research Agreement terminates;
"RESEARCH AGREEMENT" means the research funding agreement in the agreed
form;
"RESTRICTED ACTIVITY" means:
(a) in the case of the Warrantors other than the Roslin Institute,
the business of the Company as at the Completion Date;
(b) in the case of the Roslin Institute, the Restricted Field;
"RESTRICTED FIELD" means activities relating to cell based systems for
the cloning of animal and human cells and non-human animals;
"ROSLIN INSTITUTE" means the Roslin Institute of ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇;
"SALE SHARES" means all of the issued A, B, C and D ordinary shares in
the Company, details of which are set out in column 3 of schedule 1;
"SECOND ESCROW SHARES" means 315,000 of the Consideration Shares issued
or allocated to the Warrantors as shown in column 4.2(b) of schedule 1;
"SECURITIES ACT" means the US Securities ▇▇▇ ▇▇▇▇, as amended;
"SOFTWARE" means all computer programs and all related object code and
source code and databases used by the Company in connection with its
business;
"SSAPS" means the statements of standard accounting practice adopted by
the Accounting Standards Board Limited;
"STOCK EXCHANGE" means London Stock Exchange Limited;
"SUBSIDIARY" means a subsidiary company as defined in section 736 of
the Companies Act;
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"3i" means 3i Group Plc (Reg No 1142830) of ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇ ▇▇▇, being one of the Vendors;
"3i CONSIDERATION SHARES" means 1,240,000 of the Consideration Shares
to be issued by the Purchaser in favour of 3i at Completion;
"TCGA" means the Taxation of Chargeable Gains ▇▇▇ ▇▇▇▇;
"TAXATION" means all forms of taxation, charges, duties, costs,
imposts, levies and rates whenever imposed and whether of the United
Kingdom or elsewhere and whether chargeable directly or primarily
against or attributable directly or primarily to the Company or to any
other person, including without limitation, income tax (including
income tax or amounts equivalent to or in respect of income tax
required to be deducted or withheld from or accounted for in respect of
any payment), withholding taxes, corporation tax, advance corporation
tax (including amounts corresponding to or representing advance
corporation tax), capital gains tax, capital transfer tax, inheritance
tax, value added tax, customs duties, excise duties, insurance premium
tax, landfill tax, stamp duty, stamp duty reserve tax, national
insurance, social security or other similar contributions, and
generally any tax, duty, impost or levy or other amount and any
interest, penalty or fine in connection therewith but expressly
excluding, for the avoidance of doubt, community charges and rates;
"TAXATION AUTHORITY" means any local, governmental, state, federal or
other fiscal, revenue or excise authority, body or official whether in
the UK or elsewhere including without limitation, the Inland Revenue
and HM Customs and Excise;
"UK PAYE" means any tax liability pursuant to regulations made by the
Board of Inland Revenue under section 203 ICTA 1988;
"VAT" means value added tax;
"VATA" means the Value Added Tax ▇▇▇ ▇▇▇▇;
"VENDORS' AFFILIATE" means an Affiliate of any Vendor but excludes the
Company;
"COMPANY'S SOLICITORS" means Dundas Wilson of Salture Court, ▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇;
"WARRANTORS' DISCLOSURE LETTER" means the disclosure letter in the
agreed form of even date given by the Warrantors to the Purchaser;
"WARRANTORS' REPRESENTATIVE" means a committee constituting the
following individuals ▇▇▇ ▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇;
"WARRANTIES" means the representations and warranties set out in
schedule 4;
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"WARRANTORS" means the Vendors other than 3i; and
"YEAR 2000 COMPLIANT" means, in relation to the Software each part of
the Computer System and any asset used in the business of the Company
which relies upon computer hardware, firmware, software or other
information technology, that neither its performance nor its
functionality is or will be affected by dates prior to, during or after
the year 2000, and in particular:
(a) no value for current date causes or will cause any
interruption in its operation;
[(b) no value for any date element in any data used as input by the
software cause or will cause any interruption in the operation
of the software, which will either correctly interpret the
date element (where it is a valid date) or else detect and
report it as an invalid date and continue processing
accordingly;]
(c) date-based functionality behaves and will behave consistently
for dates prior to, during and after year 2000 and produces
[and will produce correct results in accordance with the
software's specifications];
(d) in all interfaces and data storage, the century in any date is
and will be specified either explicitly or by unambiguous
algorithms or inferencing rules; and
(e) the year 2000 is and will be recognised as a leap year.
1.2 In this agreement references to:
(a) an enactment includes a reference to:
(i) that enactment as amended, extended
or applied by or under any other enactment
before the date of this agreement;
(ii) any enactment which that enactment
re-enacts (with or without modification);
and
(iii) any subordinate legislation made
before the date of this agreement under any
enactment, including an enactment referred
to in sub-clause 1.2(a) (i) or (ii) above;
(b) the singular includes a reference to the
plural and vice versa;
(c) any clause, sub-clause or schedule is to a
clause, sub-clause or schedule (as the case may be)
of or to this agreement;
(d) any gender includes a reference to all other
genders;
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(e) persons include any form and all forms of
legal entity including individuals, companies, bodies
corporate (wherever incorporated or established or
carrying on business), unincorporated associations,
governmental entities and partnerships and, in
relation to any party who is an individual, his legal
personal representative(s);
(f) the words "including", "include" and "in
particular" shall be construed as being by way of
illustration only and shall not be construed as
limiting the generality of any foregoing words; and
(g) documents "in the agreed form" are to
documents in the form of the draft agreed between the
parties to this agreement prior to Completion and
initialled by or on behalf of the parties for the
purposes of identification.
1.3 In part D of schedule 4 reference to a section only
is to a section of the ICTA, reference to a schedule with a
number is to a schedule of ICTA and reference to an Act
followed by a year is to the Finance Act of that year.
1.4 The introduction and schedules form part of this
agreement and shall have the same force and effect as if
expressly set out in the body of this agreement. Accordingly,
any reference to this agreement shall include the introduction
and schedules.
2. SALE AND PURCHASE
2.1 Subject to the satisfaction or waiver of the
provisions of schedule 5 and implementation of Clause 7, each
of the Vendors with full title guarantee shall sell the number
of Sale Shares set out against such Vendor's name in column 3
of schedule 1 and the Purchaser shall purchase all right,
title and interest in the Sale Shares with effect from
Completion.
2.2 Each of the Vendors shall sell the Sale Shares free
from all Encumbrances and together with all rights to
dividends and other distributions of whatsoever nature
declared after the date of this agreement in respect of such
Sale Shares and all other rights and advantages belonging to
or accruing on such Sale Shares as at and from that date.
2.3 Neither the Purchaser nor the Vendors shall be
obliged to complete the sale and purchase of any of the Sale
Shares unless the sale and purchase of all the Sale Shares is
completed simultaneously.
2.4 Each of the Vendors hereby irrevocably waives all or
any pre-emption or other rights which that Vendor may have
pursuant to the Company's articles of
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association or to any other agreement relating to the Sale
Shares or otherwise, so as to enable the sale of the Sale
Shares to the Purchaser to proceed free of any such
pre-emption or other rights.
3. CONSIDERATION
3.1 The total consideration for the sale of the Sale
Shares and the Option Shares shall be the issue of the
Consideration Shares to the Vendors as contemplated by this
agreement and the Option Exchange Agreements.
3.2 The 3i Consideration Shares shall be issued to 3i on
Completion.
3.3 The Escrow Shares shall be issued to the Warrantors
on Completion in the amounts shown against the respective
names of the Warrantors in column 4.2 of schedule 1 (other
than those to be issued in respect of the Option Shares) and
shall be subject to the provisions of the Escrow Agreement and
this agreement. For the avoidance of doubt, 3i shall not and
shall not be required to deposit any of the 3i Consideration
Shares issued to it in the Escrow Fund or otherwise grant any
Warranties in favour of the Purchaser other than as set out in
Part A of schedule 4.
3.4 The Consideration Shares to be issued pursuant to
this agreement shall not be registered as at Completion under
the Securities Act in reliance upon the exemption contained in
Regulation S and section 4(2) of the Securities Act and
Regulation D promulgated thereunder and in reliance upon the
Warranties.
3.5 The obligations of the Purchaser, the Company and the
Vendors with respect to the registration of the Consideration
Shares shall be governed by the Registration Rights Agreement.
4. VENDORS' WARRANTIES
4.1 Each of the Vendors on its own behalf severally
represents and warrants to the Purchaser in the knowledge that
the Purchaser is entering into this agreement in reliance upon
each of the Warranties contained in Part A of schedule 4 being
true and accurate.
4.2 The Warrantors severally represent and warrant to the
Purchaser in the knowledge that the Purchaser is entering into
this agreement in reliance upon each of the Warranties
(subject to the limitations contained in clause 5) set out in
Parts B, C and D of Schedule 4 being true and accurate.
4.3 Subject to the limitations contained in clause 5 if
there is a breach of any of the Warranties then, in respect of
each such breach and without prejudice to the right of the
Purchaser to calculate Damages on any basis available to it
but subject to the limitations contained in clause 5 and the
other provisions of this agreement, the Warrantors agree that
the Purchaser may retain such Escrow Shares and/or New
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Shares or such other property as is retained in the Escrow
Fund subject to and in accordance with the Escrow Agreement.
The Purchaser agrees with the Warrantors that retention as
aforesaid is the only remedy which the Purchaser has and may
take against the Warrantors in respect of a breach of this
agreement, including the Warranties.
4.4 Upon the sale of the Sale Shares by the Purchaser (or
any subsequent owner thereof) the benefit of the Warranties
may be assigned in whole or in part and without restriction by
the person for the time being entitled to them. For the
avoidance of doubt, any person to whom the benefit of the
Warranties is assigned shall be subject to the limitations set
out in clause 5 and the other applicable provisions of this
agreement.
4.5 Each of the Warranties shall be construed as a
separate and independent warranty and (subject to clause 5)
shall not be governed, limited or restricted by reference to
or inference from any other terms of this agreement or any
other Warranty.
4.6 Any payments or deemed payment made by the Vendors to
the Purchaser in respect of claims under the Warranties shall
so far as possible be treated by the parties as a reduction in
the consideration for the Sale Shares received by the Vendor
or Vendors which made the payment or deemed payment.
4.7 In this agreement any reference to a Warrantors
"knowledge", "awareness", "information" or "belief" means such
knowledge, awareness, information or belief as that party
would have after having made:-
(a) in the case of the Warrantors (other than
▇▇▇ ▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇) all due and diligent enquiry
of the Warrantors (other than ▇▇▇ ▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇
and no other third party or person);
(b) in the case of ▇▇▇ ▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇
reasonable enquiry of ▇▇▇ ▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇ (and no
other third party or person);
and if there is a reference to the "knowledge",
"awareness", "information" or "belief" of more than one
Warrantor all of the relevant Warrantors shall be deemed to
have knowledge, awareness, information or belief of each
other.
4.8 Each of the Warrantors hereby agrees with the
Purchaser (for itself and as trustee for the Company) to waive
any right which it may have in respect of any
misrepresentation, inaccuracy or omission in or from any
information or advice supplied or given by the Company or any
of its officers and employees or advisers in enabling the
Warrantors to give the Warranties, to prepare the Warrantors'
Disclosure Letter and to enter into this agreement and
undertakes not to make any claim in respect of such reliance.
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4.9 Subject to the provisions of paragraph (j) of
schedule 6, the rights and remedies of the Purchaser in
respect of any breach of this agreement shall not be affected
by any investigation made by or on behalf of the Purchaser
into the affairs of the Company or actual or constructive
knowledge on the part of the Purchaser or its agents or
advisers or by any other event or matter whatsoever, except a
specific and written waiver or release given by the Purchaser
and except as otherwise expressly provided in this agreement
in relation to the Warrantors' Disclosure Letter.
4.10 All sums payable by the Vendors or the Purchaser
under this agreement shall be paid free and clear of all
deductions or withholdings unless the deduction or withholding
is required by law, in which event the Vendors or the
Purchaser (as the case may be) shall pay such additional
amount as shall be required to ensure that the net amount
received by the Vendors or the Purchaser (as the case may be)
will equal the full sum which would have been received by them
or it had no such deduction or withholding been required to be
made.
4.11 Subject to clause 5 if any payment made by the
Warrantors in relation to a claim for breach of Warranty which
relates to Taxation will be or has been subject to Taxation in
the hands of the Purchaser, the Purchaser may demand in
writing from the Warrantors such sum (after taking into
account any Taxation payable in respect of such sum) as will
ensure that the Purchaser receives and retains a net sum equal
to the sum which it would have received had the payment not
been subject to Taxation. The Warrantors shall pay any such
sum which is demanded pursuant to this sub-clause 4.11 within
10 Business Days of receipt of a notice from the Purchaser
identifying that such Taxation is legally due for payment
within 20 Business Days from the date of such notice.
5. LIMITATIONS TO THE WARRANTIES
5.1 Notwithstanding any other provision of this agreement
(but save as acknowledged below), no limitations of any kind
whatsoever shall apply to any claim under this agreement or
any agreements contemplated hereby against a Vendor:
(a) which is (or the delay in discovery of which
is) the consequence of any fraud, dishonesty or
deliberate concealment on the part of that Vendor,
his or its agents or advisers; or
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15
(b) which is the result of a breach of any
Warranty in Part A of schedule 4;
it being acknowledged and agreed that the limitation provisions shall
apply to any claim brought against any of the other Vendors who were
not a party to such fraud, dishonesty or concealment or to whose Sale
Shares the breach of Warranty in Part A of the schedule 4 did not
apply.
5.2 The following provisions of this clause 5.2 shall
operate to exclude and/or limit the liability of the
Warrantors under or in connection with this agreement (where
expressly stated) in sub-clauses 5.2 (m) and (s) and the
Warranties:
(a) the Warrantors shall not be liable under or
by virtue of the Warranties in respect of any matter
Disclosed in the Warrantors' Disclosure Letter;
provided, however, that any information Disclosed
with respect to a particular Warranty in the
Warrantors' Disclosure Letter shall be deemed to be
Disclosed and incorporated in any other section of
the Warrantors' Disclosure Letter where such
disclosure would be appropriate;
* (b) the Warrantors shall have no liability under
or by virtue of the Warranties unless and until the
aggregate amount of all valid claims by the Purchaser
under or by virtue of the Warranties shall exceed
[*] (subject always to the other provisions of
this clause 5.2) and in such case the Warrantors
shall be liable for the whole of such amount of that
claim and not just the excess;
(c) no single claim may be made against the
Warrantors under or by virtue of the Warranties
* unless the amount so claimed in respect of that claim
shall exceed [*] and any claim of less than that
amount shall be disregarded for all purposes but once
such amount has been exceeded, the Warrantors shall
be liable for the whole of such amount of that claim
and not just the excess;
(d) if, but for this clause 5.2(d), the
Warrantors would be liable in respect of the same
matter under or by virtue of more than one of the
Warranties and any sum in respect of that matter is
paid under one particular Warranty the liability of
the Warrantors (if any) under or in respect of
another Warranty in respect of that matter shall be
reduced by the amount of such sum;
(e) if the Warrantors pay an amount in respect
of any liability under or by virtue of the Warranties
and the Purchaser or the Company subsequently
recovers from a third party (including, for the
avoidance of doubt, any insurance company or any tax
authority) a sum which is received as a result of
that breach, the Purchaser shall promptly repay or
----------
* Material has been omitted pursuant to a request for confidential treatment.
Such material has been filed separately with the Securities and Exchange
Commission.
-13-
16
procure repayment to the Warrantors of so much of the
amount paid by them as, when added to the sum
recovered from such third party, exceeds the amount
due to the Purchaser or the Company in respect of
that breach;
(f) the amount of any claim under or by virtue
of the Warranties shall take into account any cash
relief from, or cash deductions realised by the
Company and the Purchaser in respect of Taxation;
(g) the Warrantors shall not be liable for any
claim which would not have arisen, or to the extent
that any claim would have been for a lesser amount,
except as a result of a voluntary act, default or
transaction of the Purchaser or of the Company (save
where pursuant to a legally binding obligation
existing prior to Completion or in the ordinary
course of business) or any permitted successor or
assignee of the Purchaser occurring on or after
Completion;
(h) the Warrantors shall be under no liability
under or by virtue of the Warranties in respect of
any matter arising from or connected with any change
of the accounting reference date of the Company or
any accounting policy or practice of the Company
adopted by the Purchaser or the Company after
Completion;
(i) the Warrantors shall not be liable in
respect of a claim under or by virtue of the
Warranties if such claim would not have arisen or
would have been made for a lesser amount but for a
change or changes in legislation made after
Completion;
(j) the amount of any successful claim against
the Warrantors under or by virtue of the Warranties
shall be deemed to constitute a reduction in the
price payable by the Purchaser for the Sale Shares;
(k) the Warrantors shall have no liability to
the Purchaser or the Company under or by virtue of
the Warranties:
(i) to the extent that allowance,
provision or reserve in respect of the
matter or thing which gave rise to any such
liability has been provided for in the
Accounts or to the extent that payment or
discharge of the relevant matter has been
taken into account therein; or
(ii) in respect of any allowance,
provision or reserve made in the Accounts
which is insufficient or inadequate only by
reason of any increase in any rate of
Taxation effective after the Accounts Date;
or
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(iii) to the extent that such liability
would not have arisen or would have been
made for a lesser amount but for any
alteration, enactment or re-enactment of any
legislation, subordinate legislation or
quasi legislative act or any regulatory
requirement or any SSAP or FRS which takes
effect after Completion;
(l) nothing contained in this agreement shall or
shall be taken to relieve the Purchaser or the
Company of any duty and obligation to use reasonable
endeavours to (which shall not include making a claim
against the Purchaser's insurer but shall include
making a claim against the Company's insurer(s) as at
Completion where permitted under the relevant
insurance policy) mitigate any Damages which the
Purchaser or the Company may incur or suffer and the
Purchaser shall and shall procure that the Company
shall use reasonable endeavours (which shall not
include making a claim against the Purchaser's
insurer but shall include making a claim against the
Company's insurer(s) as at Completion where permitted
under the relevant insurance policy) to mitigate any
such Damages which the Purchaser or the Company may
incur or suffer in relation to any claim against the
Warrantors under or pursuant to the Warranties
subject to the Purchaser and/or the Company being
indemnified by the Warrantors against all costs and
expenses reasonably and properly incurred in
connection therewith;
(m) if the benefit of the Warranties or indeed
any other right of the Purchaser or the Company under
this agreement is assigned, the obligations and
liabilities of the Warrantors (if any) shall be no
greater than it would have been if the Purchaser had
remained the owner of the Sale Shares and had
retained the benefit of the Warranties and its other
rights under or pursuant to this agreement;
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18
(n) the Purchaser irrevocably and
unconditionally waives any and all rights it may have
to rescind this agreement for any breach of the
Warranties or untrue representation, or undertaking
or statement of fact or opinion made to it in
relation to the subject matter or this agreement or
the Company which is not contained in this agreement
or the Warrantors' Disclosure Letter (including the
annexures thereto) and, save in the case of any
fraudulent misrepresentation, the Purchaser agrees
with the Warrantors that the Purchaser shall have no
remedy against the Warrantors, and the Warrantors
shall have no liability of whatever nature and
howsoever arising to the Purchaser, in respect of any
statement of fact or opinion whatsoever, including
any untrue or misleading statement, warranty or
representation (express or implied) made to the
Purchaser or its agents, officers or employees upon
which the Purchaser or its agents, officers or
employees relied or may have relied in entering into
this agreement which is not contained in this
agreement;
(o) for the purpose of enabling the Warrantors
to remedy a breach or to mitigate or otherwise
determine the amount of any claim for breach of the
Warranties or to decide what steps or proceedings
should be taken in order to mitigate any claim for
breach of the Warranties, the Purchaser shall:
(i) give notice to the Warrantors
within 14 days of any breach or
circumstances giving or likely to give rise
to a breach coming to its notice or to the
notice of any company;
(ii) pass to the Warrantors as soon as
reasonably possible, any further particulars
it receives relating to the breach or
circumstances referred to in paragraph (i)
above;
(iii) make or procure to be made
available to the Warrantors or their duly
authorised representatives all relevant
books of accounts, records and
correspondence of the Company and permit the
Warrantors to ascertain or extract any
relevant information therefrom;
(iv) at the request of the Warrantors,
allow the Warrantors to participate in the
sole conduct of any claim against the
Purchaser or the Company which has given
rise to a claim for breach of the Warranties
against the Warrantors under this agreement;
and
-16-
19
(v) make no admission of liability,
agreement, settlement or compromise in
respect of any claim with any third party
(including, for the avoidance of doubt, any
insurance company) without the prior written
approval of the Warrantors, which approval
shall not unreasonably be withheld;
(p) upon any claim being made, the Purchaser
shall and shall co-operate to procure that the
Company shall, make available to accountants and
others appointed by the Warrantors such relevant
records and information as the Warrantors reasonably
request in connection with such claim and the
Purchaser shall, and shall co-operate to procure that
the Company shall, use best endeavours to procure
that the auditors (both past and then current) of the
Company makes available to the Warrantors and to
accountants and others appointed by the Warrantors
their audit working papers in respect of audit of the
Company's accounts for any relevant accounting period
in connection with the claim. Such access shall be
required only at reasonable times and on reasonable
notice;
(q) the liability of the Warrantors under or in
connection with the Warranties shall be several and
not, for the avoidance of doubt, joint and several;
(r) notwithstanding any other provision of this
agreement (including, for the avoidance of doubt, the
Warranties), the Purchaser acknowledges to and agrees
with the Warrantors that no warranty, covenant,
representation, indemnity or undertaking (whether
express or implied) shall be deemed to be made nor
shall the Warrantors have any liability in respect of
any Warranty or any other provision of this agreement
in so far as it relates to the Company's IPR or any
person's or persons' Intellectual Property including,
for the avoidance of doubt, in relation to either the
Company's interest or interests in or title to titles
in and to the Company's IPR save to the extent
expressly set out in Warranties 12.1 to 12.19 set out
in Part B of schedule 4 respectively ("the IPR
Warranties");
-17-
20
(s) the maximum aggregate liability of the
Warrantors under or by virtue of this agreement
(including the Warranties) shall not exceed the
aggregate value of the Escrow Fund at the date of
payment of any such liability. Accordingly, the
maximum aggregate liability of each of the Warrantors
under this agreement (including the Warranties) shall
not exceed the value of the Escrow Shares set against
the name of the respective Warrantor in column 4.2 of
schedule 1 as at the date of payment of any such
liability. Any and all amounts to be paid by the
Warrantors for their share of any liability under
this agreement (including the Warranties) shall be
payable only out of the Escrow Fund (to the extent
then available).
(t) all liability of the Warrantors under or by
virtue of the Warranties shall cease and any claim
made thereunder or by virtue thereof against the
Warrantors shall be wholly barred and unenforceable:-
(i) in the case of liability under or by virtue of the
Warranties (other than the IPR Warranties), with
effect from 3 May 2000; and
(ii) in the case of liability under or by virtue of the
IPR Warranties, with effect from 3 November 1999.
unless notice of the relevant claims specifying the amount
claimed and with (i) reasonable details of the facts and
circumstances, in so far as then available, constituting or
giving rise to the alleged breach or the alleged liability and
(ii) the amount claimed in respect thereof (detailing (in so
far as possible) the amount of Damages suffered by the
Purchaser or the Company and the basis and method of
calculation of such Damages) shall have been given to the
Warrantors prior to the dates referred to in paragraphs (i)
and (ii) above. Any such claim under or by virtue of the
Warranties (other than the IPR Warranties) shall (if it has
not been previously satisfied, settled or withdrawn) be deemed
to have been withdrawn after 3 November 2000 unless
proceedings (whether by way of litigation, arbitration or
otherwise) in respect of it have commenced by being served on
the Warrantors prior to 3 November 2000. Any such claim under
or by virtue of the IPR Warranties shall (if it has not been
previously satisfied, settled or withdrawn) be deemed to have
been withdrawn on 3 May 2000 unless proceedings (whether by
way of litigation, arbitration or otherwise) in respect of it
have been commenced by being served on the Warrantors prior to
3 May 2000. Following the commencement of any claim under the
Warranties the Purchaser undertakes to proceed with such claim
or claims as quickly as reasonably possible (having regard to
all relevant circumstances).
-18-
21
5.3 Subject to this clause 5, all claims shall be made in
accordance with the provisions of the Escrow Agreement.
6. PURCHASER'S WARRANTIES
6.1 The Purchaser represents and warrants in the
knowledge that the Vendors are entering into this agreement in
reliance upon the accuracy of each of the Purchaser's
Warranties that the Purchaser's Warranties are true and
accurate.
6.2 Each of the Purchaser's Warranties shall be construed
as a separate and independent warranty and shall not be
governed, limited or restricted by reference to or inference
from any other terms of this agreement or any other
Purchaser's Warranty.
6.3 The rights and remedies of the Vendors in respect of
any breach of this agreement shall not be affected by any
investigation made by or on behalf of the Vendors into the
affairs of the Purchaser or actual or constructive knowledge
on the part of the Vendor or their agents or advisers or by
any other event or matter whatsoever, except a specific and
written waiver or release given by the Vendor and except as
otherwise expressly provided in this agreement in relation to
the Purchaser's Disclosure Letter.
6.4 If there is a breach of any of the Purchaser's
Warranties then, in respect of each such breach, the Vendors
shall be entitled to claim Damages from the Purchaser on any
basis which may be available to them.
7. COMPLETION
7.1 Subject to the provisions of schedule 5, the sale and
purchase of the Sale Shares shall be completed at the offices
of the Purchaser's Solicitors at 9.00 a.m. on 3 May 1999 (or
at such other time or place as the parties shall agree).
7.2 On Completion 3i shall deliver to the Purchaser a
duly executed stock transfer forms in respect of its Sale
Shares together with the related share certificates (such
stock transfer forms to be in favour of the Purchaser or its
nominees, as the Purchaser shall direct) to enable it or its
nominees to be registered as the holders of the Sale Shares
free from all encumbrances.
7.3 On Completion the Warrantors shall deliver or cause
to be delivered to the Purchaser:
(a) duly executed stock transfer forms in
respect of the Sale Shares together with the related
share certificates (such stock transfer forms to be
in favour of the Purchaser or its nominees, as the
Purchaser shall direct) to
-19-
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enable it or its nominees to be registered as the
holders of the Sale Shares free from all
Encumbrances;
(b) an acknowledgement from each of the
Warrantors to the Purchaser and the Company executed
as a deed to the effect that save in relation to
remuneration or reimbursement of expenses incurred in
relation to his or her employment details of which
are specified in such deed, there is no outstanding
indebtedness owing at Completion from the Company to
such Warrantor or to any such Warrantor's Affiliate
or vice versa;
(c) letters of resignation in the agreed form
from ▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇ as directors of the Company;
(d) written confirmation to the Company and the
Purchaser that each of the aforementioned departing
directors of the Company (other than ▇▇▇ ▇▇▇▇▇ and
▇▇▇ ▇▇▇▇▇▇) has returned or delivered to the Company
all property of the Company used, enjoyed or held by
them in their capacity as employees or officers of
the Company including without prejudice to the
generality of the foregoing books, records, papers
and information of the Company (on whatever medium
stored), motor vehicles, credit cards, keys, security
cards, personal computers, software, magnetic or
other discs on which information is stored;
(e) the written resignation of the auditors of
the Company together with a statement in accordance
with section 394 of the Companies Act that there are
no circumstances connected with such resignation
which they consider should be brought to the
attention of the members or creditors of the Company;
(f) the statutory books of the Company complete
and accurate up to Completion (but not including any
acts or transactions to take place at Completion) and
any company seal(s), certificates of incorporation,
certificates of incorporation on change of name and
all unused share certificates of the Company and all
cheque books of the Company;
(g) the Warrantors' Disclosure Letter;
(h) revised contracts in the agreed form between
the Purchaser and each of Simon Best and Piers
Lincoln duly executed by the parties.
(i) consultancy agreements in the agreed form
between the Purchaser and each of ▇▇▇▇ ▇▇▇▇▇ and ▇▇▇
▇▇▇▇▇▇ duly executed by the parties.
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7.3 On Completion the Warrantors shall procure the
holding of a meeting of the directors of the Company at which
the directors of the Company shall:
(a) (subject to stamping) approve the transfers
to the Purchaser (or its nominees) of the Sale
Shares;
(b) appoint ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇ as
additional directors of the Company;
(c) accept the resignations referred to in
sub-clauses 7.2(c) and (e) relating to the Company;
(d) appoint Ernst & Young as the new auditors of
the Company;
(e) change the accounting reference date of the
Company to 31 December; and
(f) cancel the existing mandates to the
Company's bankers and replace them with new mandates
as requested by the Purchaser.
7.4 On Completion the Vendors shall pass a written
resolution changing the name of the Company to Geron Bio-Med
Limited.
7.5 On Completion the Purchaser shall deliver to the
Vendors or to the Company's Solicitors for and on behalf of
the Warrantors (whose receipt shall be a sufficient
discharge):
(a) a certified copy of the minutes of the board
of directors of the Purchaser authorising the
execution and performance by the Purchaser of its
obligations under this agreement;
(b) the Purchaser's Disclosure Letter;
(c) a certified copy of instructions to the
Purchaser's Transfer Agent to prepare Share Stock
Certificates in favour of the Vendors in respect of
the number of Consideration Shares set out against
their respective names in column 4 of schedule 1.
7.6 On or prior to Completion each of the following shall
be done:
(a) the Purchaser and Roslin Institute shall
enter into or have entered into the Research
Agreement;
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(b) the Purchaser, the Company and Roslin
Institute shall enter into or have entered into the
Licence Agreement;
(c) the Purchaser, and the Warrantors'
Representative shall and shall ensure that the Escrow
Agent shall have entered into the Escrow Agreement;
(d) the Purchaser and each of the Vendors' shall
enter into or have entered into the Registration
Rights Agreement.
7.7 On or as soon as practicable after Completion, the
Consideration Shares which each Warrantor is entitled to
receive pursuant to clause 3 of this agreement (namely, in
aggregate 860,000 Consideration Shares) shall without any act
of such Warrantor be registered in the name of the Warrantor
and shall be deposited with the Escrow Agent and such deposit
or deposits shall constitute the Escrow Fund.
8. COVENANTS OF THE PURCHASER AND THE VENDORS
8.1 Each party shall execute and do all such lawful
documents acts and things as may be reasonably required
subsequent to Completion by the other parties for, in the case
of the Purchaser, securing to or vesting in the Purchaser the
legal and beneficial ownership of such party's Sale Shares and
in the case of the Vendors, the legal and beneficial ownership
of the relevant Consideration Shares (subject always to the
other provisions of this Agreement, the Escrow Agreement and
the Registration Rights Agreement).
8.2 All parties to this agreement agree that the
Purchaser and the Vendors will be jointly responsible for any
press release or publication with respect to the existence of
this agreement or the transactions contemplated hereby and
further agree to co-operate in good faith with respect to any
such press release or public statement and except as may be
required by law or by any regulatory authority to which the
parties are subject, further agree not to issue any such press
release or public statement without the prior written consent
of the Purchaser, 3i and the Warrantors' Representative (as
appropriate) (in the case of a publication proposed by the
Company and/or a Vendor). Each party agrees to provide any
such press release or public statement to the Company, 3i and
the Warrantors' Representative in advance of publication and
provide the Company, 3i and the Warrantors' Representative a
reasonable opportunity to review and comment on such
publication.
8.3 Each party will fully co-operate (in so far as it is
lawfully able so to do) with the other parties, their lawyers
and accountants in connection with any steps required to be
taken as part of its obligations under this agreement.
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8.4 The Purchaser reserves the right to make an election
under Section 338(g) of the US Internal Revenue Code and any
comparable provisions of state, local or foreign law. The
Vendors acknowledge that the Purchaser shall control the
preparation and filing of such election and the Vendors agree
that they will reasonably co-operate with the Purchaser and
the Company with respect thereto.
8.5 All stamp duties or stamp duty reserve tax payable on
the transfer of the Sale Shares to the Purchaser or otherwise
arising from the transactions contemplated by this agreement
shall be borne by the Purchaser.
8.6 The Warrantors shall procure that the Company's
Accountants shall prepare the tax returns and computations of
the Company for the accounting period ending on or prior to 28
February 1999, save that the preparation and submission of the
same shall not be unreasonably delayed. Should the preparation
or submission of the tax returns and computations of the
Company for the accounting period ending on or prior to the 28
February 1999 in the reasonable opinion of the Purchaser be
unreasonably delayed by the Warrantors, then the Purchaser
shall prepare and submit the same.
8.7 The Purchaser shall procure that the returns and
computations mentioned in clause 8.6 shall be authorised,
signed and submitted to the appropriate Tax Authority without
amendment or with such amendments required by the Purchaser
and which the Warrantors shall reasonably agree and the
Purchaser shall give the Warrantors or their agents all such
assistance as may be reasonably required to prepare those
returns and computations for submission to the appropriate
Taxation Authorities provided that the Purchaser shall not be
obliged to take any such action as is mentioned in this clause
8.7 in relation to any return that is not full, true and
accurate in all material respects. Nor shall the Purchaser be
obliged to take any such action which in the reasonable
opinion of the Purchaser shall affect adversely either the
future tax liability of either the Purchaser or the Company
concerned or of any person connected with any of them, or in
any way materially prejudice the relationship of the Purchaser
or the Company with any Taxation Authority.
9. RESTRICTIONS
9.1 By way of further consideration of the Purchaser
agreeing to purchase the Sale Shares from the Vendors, each of
the Warrantors covenants with the Purchaser that he or it will
not whether alone or jointly with or as agent of any person or
persons directly or indirectly:
(a) for the period of two years after the
Relevant Date:
(i) take up or hold any office in or
with any business or undertaking; or
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(ii) take up or hold any post or
position which enables or permits that
Warrantor to exercise a controlling
influence over any business or undertaking;
or
(iii) take up or hold any employment or
consultancy with any person which is engaged
in any business or undertaking
which results in that Warrantor being engaged in a Restricted
Activity, provided that the Warrantor shall not be precluded
from:-
(aa) in the case of the Warrantors (other than Roslin
Institute), complying with their obligations under
any contract of employment or consultancy agreement
with the Company or the Purchaser or being employed
or otherwise engaged in any such business or
undertaking whose activities include any business
which competes with the Company so long as that
Warrantor will not be directly or indirectly employed
or engaged in, or review materials produced by or
relating to that business or undertaking;
(bb) in the case of Roslin Institute:-
(A) receiving commercial funding of research in
the Restricted Field subject to the prior
written consent of the Purchaser;
(B) receiving non-commercial funding of research
in the Restricted Field provided that the
Purchaser shall, prior to any intellectual
property arising from such research being
made available to any third party for
commercial exploitation, have an exclusive
option exercisable within 45 days following
receipt of written notice from the Roslin
Institute to take an exclusive worldwide
licence to such intellectual property and if
it elects not to do so (for whatever reason)
or the terms of such licence cannot be
agreed within such period then such
intellectual property may be offered to
third parties on terms no more favourable
than the terms upon which it was offered to
the Purchaser;
(cc) holding as an investment not more than 5% of
the issued share capital of a company quoted on a
recognised stock exchange (as that expression is
defined in section 207 Financial Services Act 1986);
(b) for the period of two years after the
Relevant Date deal with any person who at any time
during the period of twelve months prior to the
Relevant Date is or was a collaborator or customer of
the Company in connection with any research,
development, products or services in competition with
the Restricted Activity provided that that each
Warrantor shall not be precluded from dealing with a
company whose
-24-
27
activities compete with the Company so long as that
Warrantor does not either directly or indirectly deal
in any such research, development, products or
services which so compete;
(c) for the period of two years after the
Relevant Date canvass, solicit, approach or seek out
or cause to be canvassed, solicited, approached or
sought out or by any other means endeavour to entice
away from the Company any customer, orders,
instructions or other material in respect of any
products or services provided to or supplied by the
Company provided the Warrantor has transacted with
such person as a customer or as a supplier;
(d) for the period of two years after the
Relevant Date canvass, solicit, approach, seek out,
or cause to be canvassed, solicited, approached or
sought out or by any other means endeavour to entice
away from the Company, or employ or aid or assist any
other person or persons in employing or otherwise
retaining the services of anyone who is employed by
the Company or who is a consultant to or who is a
collaborator with the Company at the Relevant Date
but shall not include any person employed in a junior
administrative or secretarial capacity;
(e) after the Relevant Date either represent
himself or itself or hold himself or itself out to be
in any way connected with or interested in the
business of the Company.
9.2 The Warrantors hereby acknowledge and declare that
the restrictions in sub-clause 9.1 are reasonable in all the
circumstances as at the Completion Date; that such
restrictions are integral to the terms on which the Purchaser
has agreed to purchase the Sale Shares and that each of such
restrictions shall be construed and take effect independently
of the others.
9.3 If any breach or violation of the provisions of
sub-clause 9.1 occurs, the Warrantors and the Purchaser agree
that damages alone are likely not to be sufficient
compensation and that injunctive relief is reasonable and is
likely to be essential to safeguard the interests of the
Purchaser and of the Company and that injunctive relief (in
addition to any other remedies afforded by a court of equity)
may (subject to the discretion of the courts) be obtained. No
waiver of any such breach or violation of the provisions of
sub-clause 9.1 shall be implied from forbearance or failure by
the Purchaser to take action
-25-
28
10. CONFIDENTIALITY
10.1 Each Vendor acknowledges to the Purchaser that he or
it has been exposed to information about the Company which is
either a trade secret, confidential or commercially sensitive
and which may not be readily available to others engaged in a
similar business to that of the Company or to the general
public and which if disclosed may cause harm to the Company or
the Purchaser.
10.2 Subject to sub-clauses 10.3 and 10.4, each Vendor
undertakes to the Purchaser severally that he or it shall keep
secret and shall not at any time, for whatever reason, use,
communicate or reveal to any person for that Vendor's own or
another's benefit, any Confidential Information which shall
have come to his or its knowledge prior to Completion (except
in this context "use" shall not be construed to apply to the
use of such information in making and monitoring investments
by a Vendor in the ordinary course of business). Each Vendor
shall as soon as reasonably practicable inform the Purchaser
of any disclosure or use of any such information of which he
or it becomes actually aware knowing it to be Confidential
Information.
10.3 The restrictions contained in sub-clause 10.2 shall
not apply to:
(a) any disclosure authorised in writing by an
officer of the Purchaser or required in the ordinary
and proper course of the particular Vendor's service
agreement or consultancy agreement with the Purchaser
or the Company or in or as required by the order of a
court of competent jurisdiction or an appropriate
regulatory authority or Government Entity; or
(b) any information which was known to the
particular Vendor concerned prior to the commencement
of his employment or engagement by the Company or is
in or comes into the public domain otherwise than as
a result of a breach by such Vendor of this clause
10.
10.4 Except:
(a) as may be required by law or in the case of
the Purchaser or 3i the regulations of any recognised
investment exchange or recognised stock exchange (as
defined in the Financial Services ▇▇▇ ▇▇▇▇ and the
Companies Act respectively) or required by any
regulatory authority to which the parties are
subject; or
(b) as may be required in relation to any
registration of this agreement or any arrangement of
which it forms part under the Restrictive Trade
Practices ▇▇▇ ▇▇▇▇; or
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29
(c) as may be required to vest the full benefit
of this agreement or any other agreements or
documents entered into and as contemplated hereby
(including, for the avoidance of doubt, enforcement
thereof) in the Purchaser and the Vendors
respectively;
the provisions of this agreement and all negotiations relating to this
agreement are strictly confidential and no announcement or disclosure
of or publicity relating to the sale and purchase hereunder and terms
of this agreement shall be made by the parties to any third party
(other than their professional advisers and bankers) without the
written agreement of the other parties save where expressly provided
otherwise in this agreement.
11. RESTRICTIVE TRADE PRACTICES ACT
Unless this agreement or any agreement or arrangement of which this
agreement forms part is a non-notifiable agreement for the purposes of
section 27A of the Restrictive Trade Practices ▇▇▇ ▇▇▇▇, if there is a
provision of this agreement, or of any such agreement or arrangement,
which causes or would cause this agreement or any such agreement or
arrangement to be subject to registration under the Restrictive Trade
Practices ▇▇▇ ▇▇▇▇, that provision shall not take effect until the day
after the day upon which particulars of this agreement (or of that
agreement or arrangement, as the case may be) have been furnished to
the Director General of Fair Trading pursuant to section 24 of the
Restrictive Trade Practices Act 1976 and if the agreement (or any other
such agreement or arrangement) is subject to registration under the
Restrictive Trade Practices Act 1976 the parties shall co-operate in
good faith and at the sole cost and expense of the Purchaser in order
to carry out such registration as soon as reasonably practicable
following the date of this agreement and in any event within three
months of the date of this agreement.
12. NOTICES
12.1 Any notice or other written communication given under
or in connection with this agreement may be delivered
personally or sent by prepaid recorded delivery or registered
post or by facsimile to the address or number and for the
attention of the relevant party set out in sub-clause 12.2 (or
such other address or number as is otherwise notified from
time to time).
12.2 The addresses of the parties for the purpose of
sub-clause 12.1 are as follows:
The Purchaser: ▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇
Geron Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇ 1985 94025
USA
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30
Attention: Vice President of Corporate
Development and Chief Financial
Officer
Facsimile No: (▇▇▇) ▇▇▇ ▇▇▇▇
Telephone No: (▇▇▇) ▇▇▇ ▇▇▇▇
With copy to:
▇▇▇▇▇▇ ▇ ▇▇▇▇▇
Venture Law Group
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇ 1985 94025
Facsimile No: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No: (▇▇▇) ▇▇▇-▇▇▇▇
and to:
▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
Facsimile No: 44171 936-2666
Telephone No: ▇▇▇▇▇ ▇▇▇-▇▇▇▇
The Vendors: ▇▇▇▇▇▇▇▇ ▇▇▇▇
(on behalf of the Warrantors
Dundas & ▇▇▇▇▇▇)
▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇
▇▇ ▇▇▇
Facsimile No: 0141 222 2201
Telephone No: ▇▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ (on behalf of Roslin
Institute)
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇ ▇▇▇
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31
Facsimile No: 0141 248 2326
Telephone No: ▇▇▇▇ ▇▇▇ ▇▇▇▇
c/o Local Director
3i plc
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇ ▇▇▇
Facsimile No: 0141 248 3245
Telephone No: ▇▇▇▇ ▇▇▇ ▇▇▇▇
12.3 Any such notice or other written communication shall
be deemed to have been served:
(a) if delivered personally, at the time of
delivery;
(b) if posted, at the expiry of two Business
Days after it was posted or 10 Business Days where it
was sent by airmail;
(c) if sent by facsimile message, at the time of
transmission (if sent during Business Hours) or (if
not sent during Business Hours) at the beginning of
Business Hours next following the time of
transmission in the place to which the facsimile was
sent.
12.4 In proving such service it shall be sufficient to
prove that personal delivery was made, or that such notice or
other written communication was properly addressed stamped and
posted or in the case of a facsimile message that an activity
or other report from the sender's facsimile machine can be
produced in respect of the notice or other written
communication showing the recipient's facsimile number and the
number of pages transmitted.
12.5 Any notice to be served upon the Vendors must be
given to each of them.
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13. MISCELLANEOUS
13.1 The Purchaser shall be responsible for its own and
the advisory, legal and accounting fees and expenses of the
Company and its advisers related to the negotiation,
preparation, finalisation and completion of this agreement and
all other documentation contemplated thereby. Save as
aforesaid each party shall indemnify and hold harmless the
other party from any claims for broker's or finder's fees
arising from this transaction by any person claiming to have
been engaged by such party.
13.2 Subject to clause 5, this agreement shall so far as
it remains to be performed after execution continue in full
force and effect notwithstanding Completion.
13.3 No term or provision of this agreement shall be
varied or modified by any prior or subsequent statement,
conduct or act of any party, except that the parties may amend
or vary this agreement but only by letter or written
instrument signed by all of the parties.
13.4 Subject to the other provisions of this agreement, no
waiver by any of the parties to this agreement of any
requirements of this agreement or of any of such party's
rights under this agreement shall be valid unless such waiver
is in writing and signed by or on behalf of each of the
parties to this agreement.
13.5 Subject to the other provisions of this agreement, no
failure to exercise, and no delay in exercising, on the part
of the Purchaser any right or remedy under this agreement
shall operate as a waiver of such right or remedy nor shall
any single or partial exercise of any right or remedy preclude
the exercise of any other right or remedy.
13.6 Subject to the other provisions of this agreement,
the rights and remedies conferred on the Purchaser in this
agreement are cumulative.
13.7 The headings to the clauses in this agreement and in
the schedules are for ease of reference only and shall not
form any part of this agreement for the purposes of
construction.
13.8 This agreement and the documents to be delivered on
Completion as set out in clause 7:
(a) set out the entire agreement and
understanding between the parties in respect of the
sale and purchase of the Sale Shares; and
(b) (in relation to such subject matter)
supersede all prior discussions, understandings,
undertakings, promises, conditions, indemnities,
warranties, representations, covenants, undertakings
and agreements between the parties and their agents
(or any of them) and all prior
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33
representations, warranties and expressions of
opinion by any party (or its agent) to any other
party (or its agent).
13.9 It is acknowledged and agreed that:
(a) no party has entered into this agreement in
reliance upon any representation, warranty, promise,
condition, representation, covenant, indemnity or
undertaking of any other party which is not expressly
set out in this agreement;
(b) no party shall have any claim or remedy in
respect of misrepresentation or breach of warranty
(whether negligent or otherwise) or any untrue
statement made by any other party save to the extent
set out in or expressly incorporated in this
agreement and each party irrevocably and
unconditionally waives any right which it may have to
claim damages for any misrepresentation (other than a
misrepresentation contained in this agreement) or for
breach of any express or implied warranties (other
than a warranty set out in or expressly incorporated
in this agreement).
13.10 This agreement may be entered into in any number of
counterparts and by the parties to it on separate
counterparts, each of which when so executed and delivered
shall be an original, but all the counterparts shall together
constitute one and the same instrument.
13.11 If at any time any term or provision in this
agreement shall be held to be illegal, invalid or
unenforceable, in whole or in part, under any rule of law or
enactment, such term or provision or part shall to that extent
be deemed not to form part of this agreement, but the
enforceability of the remainder of this agreement shall not be
affected.
13.12 Any notice, consent or agreement or other action to
be required to be taken by any of the Vendors pursuant to or
in connection with this agreement may only be given by each of
the Vendor on its own behalf.
13.14 This agreement shall be binding on and shall enure
for the benefit of the personal representatives and successors
of the parties.
14. WARRANTORS' REPRESENTATIVE
The following provisions of this clause 14 (other than clause
14.6) shall apply amongst the Warrantors alone to the
exclusion of the Purchaser (other than clause 14.6) and 3i:-
14.1 A committee comprising the Warrantors' Representative
shall be formed and shall at all times be comprised of not
more 2 members ("Committee"). Any member of the
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34
Committee (each a "Member") may resign at any time by giving
30 days written notice thereof to the other Member. A Member
must be a Warrantor or the duly authorised representative of a
Warrantor. Any Member may be removed at any time by the
affirmative vote or written consent of Warrantors being
interested at least 75% of the Escrow Shares. If any Member
shall resign, be removed or become incapable of acting, or if
a vacancy in the membership of the Committee shall otherwise
occur, the holders of 75% of the Escrow Shares may appoint
another person to act as a member of the Committee. Such
successor Member (if not a Warrantor) shall execute a deed
agreeing to be bound by and adhere to the provisions of this
clause 15 and thereupon, without any further act, deed or
conveyance, shall become vested with all of the rights, power
and duties of the retiring Member. If both Members are
otherwise unable to act, or if the Warrantors elect to change
the Warrantors' Representative, then the Warrantors may
appoint a new Committee or another agent or body to act as
Warrantors' Representative by the affirmative vote or written
consent of Warrantors holding not less than 75% of the Escrow
Shares. No bond shall be required of the Warrantors'
Representative, and neither Member shall receive compensation
for his, her or its services. Notices or communications to or
from the Warrantors' Representative shall constitute notice to
or from each of the Warrantors. The Warrantors' Representative
shall be entitled to submit a claim and receive reimbursement
from the Escrow Fund for all reasonable, documented
out-of-pocket expenses incurred by the Warrantors'
Representative as a result of acting as the Warrantors'
Representative; subject to the terms of the Escrow Agreement.
Any such reimbursement shall be paid in Escrow Shares out of
the relevant Escrow Fund.
14.2 ACTION BY THE COMMITTEE AND THE SHAREHOLDERS'
REPRESENTATIVE.
The Members may act only through the Committee. However, the
Members may individually implement actions approved by the
Committee. Meetings of the Committee shall be held at such
times as may from time to time be fixed by resolution of the
Committee or called by any Member of the Committee. Meetings
of the Committee shall be held at such place as from time to
time may be fixed by resolution of the Committee.
Notice of meetings of the Committee fixed by resolution of the
Committee need not be given. Notice of each other meetings
shall be mailed to each Member by the Member calling the
meeting, addressed to each Member's residence or usual place
of business, at least three days before the day on which the
meetings is to be held, or shall be sent to the Member by
telegraph, cable, wireless, or similar means so addressed or
shall be delivered personally, by telephone or by facsimile
with confirmation received, at least twenty-four (24) hours
before the time the meeting is to be held. Each notice shall
state the time and place of the meeting but need not state the
purposes thereof. Notices of any such meeting need not be
given to any Member who submits a signed waiver of notice,
whether before or after the meeting, or who attends the
meeting without protesting, prior thereto or at its
commencement, the lack of notice.
At each meeting of the Committee the presence of 2 Members
shall constitute a quorum for the transaction of business, and
the vote of 2 Members present at the time of the vote
-32-
35
shall be the act of the Committee. In the event of deadlock,
the matter shall be referred as soon as reasonably practicable
to the Warrantors for resolution. The decision of Warrantors
holding at least 75% of the Escrow Shares shall be binding on
all of the Warrantors. Notwithstanding the foregoing, if there
is for any reason only one Member, such Member may act only
for the purpose of filling vacancies on the Committee or
making an objection to any claim made by the Purchaser against
the Escrow Shares in terms of the Escrow Agreement.
Any action required or permitted to be taken by the Committee
may be taken without a meeting if all Members consent in
writing to the adoption of a resolution authorizing the
action. The resolution and the written consents thereto by the
Members shall be filed with the minutes of the proceedings of
the Committee.
Any one or more Members may participate in a meeting of the
Committee by means of a conference telephone or similar
communications equipment allowing all person participating in
the meeting to hear each other at the same time. Participation
by such means shall constitute presence in person at a
meeting.
In performing its duties hereunder and as contemplated hereby
by the Purchase Agreement and Escrow Agreement, the Committee
may, but need not, confer and consult with any or all of the
Warrantors. All decisions made and actions taken by the
Warrantors' Representative in connection with this Agreement
and the Purchase Agreement shall be final and binding on the
Warrantors, whether or not the Committee consulted with the
Warrantors in the course of making any such decision or taking
any such action.
The Warrantors' Representatives shall be entitled to rely upon
any order, judgment, award, certification, demand, notice,
instrument or other writing delivered to it under this
Agreement or the Purchase Agreement without being required to
determine the authenticity or the correctness of any fact
stated therein or the propriety or validity of the service
thereof. The Warrantors' Representative may act in reliance
upon any instrument or signature believed by it to be genuine
and may assume that any persons purporting to give notice or
receipt of advice or make any statement or execute any
document in connection with the provisions hereof has been
duly authorized to do so.
The Warrantors' Representative may engage such third parties
at such cost as the Warrantors' Representative shall in its
sole discretion deem necessary or appropriate for the adequate
performance of its duties hereunder and may rely on the advice
of such third parties with respect to matters within their
professional or expert competence.
14.3 ACTION BY THE WARRANTORS' REPRESENTATIVE
Meetings of the Warrantors may be called at any time by the
holders of twenty-five percent (25%) of the Escrow Shares or
by the Committee and shall be held on such day and at such
hour as is fixed in the call of the meeting. If all Members of
the Committee
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36
have resigned or are otherwise unable to act, the holders of
ten percent (10%) of the Escrow Shares may call a meeting.
Meetings of the Warrantors shall be held at the Edinburgh
offices of the Company's Solicitors or at such other place, as
may be fixed by the Committee.
Notice of each meeting of Warrantors shall be in writing and
shall state the place, date, and hour of the meeting and shall
state the purpose or purposes for which the meeting is called
and who called the meeting. A copy of the notice of any
meeting shall be given by the Committee or the Warrantors
meeting, personally or by mail, not less than ten (10) nor
more than twenty (20) days before the date of the meeting, to
each Warrantor. If mailed, such notice is given when deposited
in the mail, with postage thereon prepaid, directed to the
Warrantor at such address as appears in schedule 1 to the
Purchase Agreement, or, if such Warrantor shall have filed
with the Committee a written request that notices be mailed to
some other address, then directed to the Warrantor at such
other address. Notice of meetings of Warrantors need not be
given to any Warrantor who submits a signed waiver of notice,
in person or by proxy, whether before or after the meeting.
The attendance of any Warrantor at a meeting, whether in
person or by proxy, without protesting prior to the conclusion
of the meeting the lack of notice of such meeting, shall
constitute a waiver of notice by him.
Every Warrantor may authorize another person or persons to act
for him by proxy. Every proxy shall be revocable at the
instance of the Warrantor executing it, except as otherwise
provided by law. The authority of the holder of a proxy to act
shall not be revoked by the incompetence or death of the
Warrantor who executed the proxy unless, before the authority
is exercised, written notice of an adjudication of such
incompetence or of such death is received by the Committee.
Proxies which contain a faxed signature shall be treated in
the same manner as proxies with original signatures.
Whenever Warrantors are required or permitted to take any
action by vote, such action may be taken without a meeting on
written consent, setting forth the action so taken, signed by
the holders of the holders of 75% of the Escrow Shares in
which they are interested to approve the action so taken.
14.4 Neither the Warrantors' Representative nor any Member
shall be liable for any act done or omitted hereunder as the
Warrantors' Representative or Member while acting in good
faith and in the exercise of reasonable judgment. The
Warrantors (other than any Warrantor who is a Member) shall
severally indemnify the Warrantors' Representative and each
Member and shall hold the Warrantors' Representative and each
Member harmless against any loss, liability or expense
incurred without gross negligence, bad faith or willful
misconduct on the part of the Warrantors' Representative or
such Member and arising out of or in connection with the
acceptance or administration of the Warrantors'
Representative's or such Member's duties hereunder, including
the reasonable fees and expenses of any legal counsel retained
by the Warrantors' Representative or such Member.
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37
14.5 Neither the Warrantors' Representative nor any Member
shall be liable for any mistake of fact or of law or any error
of judgement. Each Member and the Warrantors' Representative
is authorised to comply with and obey laws, orders,
judgements, decrees, and regulations of any governmental
authority, court, tribunal or arbitrator. If the Warrantors'
Representative or any Member complies with any such law,
order, judgement, decree or regulation, such Warrantors'
Representative or Member shall not be liable to the Warrantors
or to any other person even if such law, order, judgement,
decree or regulation is subsequently reversed modified,
annulled, set aside, vacated, found to have been entered
without jurisdiction or found to be in violation or beyond the
scope of any constitution or law. If (i) a Member or the
Warrantors' Representative is uncertain as to the
Representative's duties or rights hereunder, (ii) has received
any notice, advice, direction or other document from any other
party with respect to this Agreement or the Purchase Agreement
which, in the Member's or the Warrantors' Representative's
opinion, is in conflict with any of the provisions of this
Agreement or the Purchase Agreement, or (iii) is aware that
dispute has arisen with respect to this Agreement or the
Purchase Agreement, each Member and the Warrantors'
Representative shall be entitled, without liability to the
Warrantors to use their best efforts to perform their duties
under this Agreement or the Purchase Agreement until the
Warrantors' Representative is directed otherwise in writing by
an order, decree or judgement of a court of competent
jurisdiction which has been finally affirmed on appeal or
which by lapse of time or otherwise is no longer subject to
appeal or by an accountants' or arbitrators' determination as
provided in the Purchase Agreement.
14.6 The aforesaid indemnities shall remain in full force
and effect against any of the parties for a period equal to
the applicable statute of limitation for such claim; provided,
however, that if prior to the expiration of such period any
claim for indemnification has been asserted but not fully
determined, such period will be extended as to such claim,
until it is finally concluded. All rights, protections and
indemnities contemplated herein shall be available to each
Member with respect to actions or omissions while a member of
the Committee despite such Member's resignation or removal
from the Committee.
14.7 If a Member or the Warrantors' Representative is
entitled to indemnification, the Warrantors shall each be
individually liable in an amount equal to the amount of
indemnification multiplied by a fraction, the numerator of
which is the number of Escrow Shares owned by a Warrantor and
the denominator of which is the number of Escrow Shares owned
by all of the Warrantors.
14.8 A decision, act, consent or instruction of the
Warrantors' Representative shall constitute a decision of all
Warrantors and shall be final, binding and conclusive upon
each of such Warrantors, and the Escrow Agent and the
Purchaser may rely upon any such decision, act, consent or
instruction of the Warrantors' Representative as being the
decision, act, consent or instruction of each and every such
Warrantor.
14.9 Each Warrantor shall have voting rights with respect
to that number of Escrow Shares and New Shares contributed to
the Escrow Fund on behalf of such Warrantor (and on any voting
securities added to the Escrow Fund in respect of such Escrow
Shares) so long as
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such Escrow Shares and New Shares or other voting securities
are held in the Escrow Fund. As the record holder of such
shares or securities accordingly the Purchaser shall ensure
that the Escrow Agent shall vote such shares in accordance
with the instructions of the Warrantors having the beneficial
interest therein and shall promptly deliver copies of all
proxy solicitation materials to such Warrantors. The Purchaser
shall show the Escrow Shares and the New Shares contributed to
the Escrow Fund (as such expressions are defined in this
Agreement or the Escrow Agreement) as issued and outstanding
on its balance sheet.
14.10 Each of the Warrantors acknowledges that the
Warrantors' Representative shall act for each Warrantor for
and on behalf of the Warrantors, to give and receive notices
and communications on behalf of the Warrantors, to enter into
and perform the Escrow Agreement, to authorise delivery to the
Purchaser of Escrow Shares and New Shares or other property
from the Escrow Fund in satisfaction of claims by the
Purchaser, to object to such deliveries, to agree to,
negotiate, enter into settlements and compromises of, and
demand arbitration and comply with orders of courts and awards
of arbitrators with respect to such claims, and to take all
actions necessary or appropriate in the judgement of the
Vendors' Representative for the accomplishment of the
foregoing. The Vendors' Representative shall act by vote or
written action or consent of a 75% of the members of the
Committee.
15. LAW AND JURISDICTION
15.1 This agreement shall be governed by and construed in
accordance with English law and each party to this agreement
submits to the non-exclusive jurisdiction of the English
courts.
15.2 The Vendors and the Purchaser agree that any legal
action or proceeding arising out of or in connection with this
agreement may be brought in the High Court of Justice in
England, and the Vendors and the Purchaser hereby irrevocably
submit to the exclusive jurisdiction of such court in
connection with any such legal action or proceedings.
15.3 The Warrantors irrevocably appoint the Company's
Solicitors as their agent to accept service of legal
proceedings in connection with all matters arising out of this
agreement and the transactions contemplated by this agreement
and agree that any writ, judgment or other notice of legal
process in connection with any such legal action or
proceedings shall be sufficiently served if delivered to the
Company's Solicitors.
15.4 The Purchaser irrevocably appoints the Purchaser's
Solicitors as its agent to accept service of legal proceedings
in connection with all matters arising out of this agreement
and the transactions contemplated by this agreement and agrees
that any writ, judgment or other notice of legal process in
connection with any such legal action or proceedings shall be
sufficiently served if delivered to the Purchaser's
Solicitors.
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39
The parties to this agreement have signed and entered into this agreement on the
date and year first written above.
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40
SCHEDULE 1
THE VENDORS AND THE CONSIDERATION SHARES
1 2 3 5 4
NAME ADDRESS NUMBER OPTION SHARES CONSIDERATION SHARES
OF SALE
SHARES
----------------------------------
4.1 4.2
3I ESCROW
CONSIDERATION SHARES
SHARES
4.2(a) 4.2(b)
FIRST SECOND
ESCROW ESCROW
SHARES SHARES
------------ -------------------- --------- ------------- -------------- --------- ------
Simon Best 6B ▇▇▇▇▇▇ ▇▇▇▇▇▇ 10,000 B 10,000 Nil 94,931 54,869
Road ordinary
▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ shares
▇▇▇ ▇▇▇▇ ▇ ▇▇▇▇▇▇ ▇▇▇▇ 4,000 B 7,500 Nil 63,245 36,555
▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ ordinary
shares
▇▇▇ ▇▇▇▇▇▇ ▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ 12,000 C Nil Nil 52,472 30,328
Eddleston ordinary
Peebleshire shares
▇▇▇▇ ▇▇▇▇▇ ▇ ▇▇▇▇▇ ▇▇▇▇▇ 2,000 B 6,000 Nil 33,270 16,226
▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ordinary
shares
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ House Nil 5,000 Nil 28,074 11,281
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇ 29 Broomie Knowe, 8,000 C Nil Nil 19,519 19,230
Lasswade ordinary
Midlothian shares
▇▇▇▇▇▇ ▇▇▇▇▇▇ 172,000 Nil Nil 253,488 146,512
Institute Biotechnology Centre B
Roslin ordinary
Midlothian ▇▇▇▇ ▇▇▇ shares
3i Group plc ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ 172,000 Nil 1,240,000 ▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇
▇▇▇ ▇▇▇ ordinary
shares
630,667
D
ordinary
shares
545.000 315,000
-38-
41
SCHEDULE 2
THE COMPANY
Name: Roslin Bio-Med
Former Names: None
Number: SC179263
Date of Incorporation: 1 October 1997
Registered Office: Roslin Biotechnology Centre
Roslin
Midlothian
Authorised Share Capital: L. 446,880 divided as follows:
A ordinary P. 1.00 shares x 172,000 = L. 172,000
B ordinary P. 1.00 shares x 248,000 = L.248,000
C ordinary P. 1.00 shares x 20,000 = L 20,000
D ordinary one ▇▇▇▇▇ shares x 630,667 = L.6,306
Issued Share Capital: L. 386,306.67
Shareholders: 3i plc 172,000 A ordinary shares
630,667 D ordinary shares
Roslin Institute 172,000 B ordinary shares
Simon Best 10,000 B ordinary shares
▇▇▇ ▇▇▇▇ 4,000 B ordinary shares
▇▇▇▇ ▇▇▇▇▇ 2,000 B ordinary shares
▇▇▇ ▇▇▇▇▇▇ 12,000 C ordinary shares
▇▇▇▇ ▇▇▇▇▇ 8,000 C ordinary shares
Directors: Simon Best
▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇
Secretary: Piers Lincoln
Accounting Reference Date: 28 February
Last Accounts: None filed
Last Annual Return: 9 November 1998
Charges: None
-39-
42
SCHEDULE 3
COMPANY IPR
PART A
PATENTS
SCHEDULE OF NUCLEAR TRANSFER PATENT APPLICATIONS
* [*]
--------
* Material has been omitted pursuant to a request for confidential treatment.
Such material has been filed separately with the Securities and Exchange
Commission.
-40-
43
* [* 2 pages omitted]
--------
* Material has been omitted pursuant to a request for confidential treatment.
Such material has been filed separately with the Securities and Exchange
Commission.
-41-
44
*[*]
PART B
TRADE MARKS
2 unregistered - see artwork attached as Annex A
PART C
LICENCES
1. License Agreement dated 7 April 1998 between Roslin Institute and the
Company.
2. Research Agreement dated 7 April 1998 between Roslin Institute and the
Company.
--------
* Material has been omitted pursuant to a request for confidential treatment.
Such material has been filed separately with the Securities and Exchange
Commission.
-42-
45
SCHEDULE 4
REPRESENTATIONS AND WARRANTIES OF THE WARRANTORS
Save where expressly provided, defined terms shall have the same meaning as in
clause 1 of this agreement.
PART A
TITLE AND INVESTMENT WARRANTIES
For the avoidance of doubt and notwithstanding any other provisions of this
agreement each of the following Warranties in this Part A of Schedule 4 is given
severally by each Vendor and accordingly it is agreed by the Purchaser that none
of the other Vendors should be liable or responsible for any breach of the
following Warranties by any of the other Vendors:-
1. The Vendor has all requisite legal and, to the extent applicable,
corporate power, and authority to enter into and perform its
obligations under this agreement and to consummate the transactions
contemplated hereby in so far as applicable to the Vendor. The
execution, delivery and performance of this agreement and the
consummation of the transactions contemplated hereby in so far as
applicable to the Vendor have been duly and validly approved and
authorised by all necessary action, including, if applicable, corporate
action, by or on behalf of such Vendor. This agreement has been duly
executed and delivered by such Vendor and constitutes a valid and
binding obligation of the Vendor, subject to the laws of general
application relating to bankruptcy, insolvency and the relief of
debtors and rules of law governing specific performance, injunctive
relief and equitable remedies. No consent, approval, order or
authorisation of, or registration, declaration or filing with, any
Governmental Entity, which has not been obtained is required by or with
respect to the Vendor in connection with the execution and delivery of
this agreement by the Vendor or the consummation by the Vendor of the
transactions contemplated hereby in so far as applicable to the Vendor.
2. The Vendor is the sole owner of the Sale Shares reflected next to
such Vendor's name in column 3 of schedule 1 of this agreement and has
or will have, as at Completion, good and valid title to such Sale
Shares free and clear of all Encumbrances whatsoever. The Vendor
represents that he or it has or will have, as of the Completion, full
right, power and authority to sell, transfer and deliver such Sale
Shares to the Purchaser, and, upon delivery of the certificate or
certificates therefor duly endorsed for transfer to the Purchaser and
the Purchaser's payment for and acceptance thereof (subject, however to
any applicable stamp duty or other taxes, levies and duties being paid
thereon and amendment thereafter of the Register of Members of the
Company to reflect such transfer), will transfer to the Purchaser good
and valid title thereto free and clear of any
-43-
46
Encumbrance. The Vendor is not party to any voting trust, agreement or
arrangement affecting the exercise of the voting rights of the Sale
Shares. There is no action, proceeding, claim or, to the Vendor's
knowledge, investigation against the Vendor or the Vendor's assets,
properties or, as applicable, any of the Vendor's respective officers
or directors, pending or, to the Vendor's knowledge, threatened, at law
or in equity, or before any court, arbitrator or other tribunal, or
before any administrative law judge, hearing officer or administrative
agency relating to or in any other manner impacting upon the Sale
Shares held by such Vendor.
3. The execution, delivery and performance of this agreement do not,
and the consummation of the purchase of Sale Shares and the other
transactions contemplated by this agreement will not conflict with or
result in a violation of the memorandum and articles of association,
bylaws, partnership agreement or other applicable charter document of
the Vendor, or conflict with, or (with or without notice or lapse of
time, or both) result in a termination, breach, impairment or violation
of, or constitute a default or result in the creation or imposition of
any lien, charge or encumbrance upon any of the Vendor's Sale Shares
under, (a) any instrument, indenture, lease, mortgage or other
agreement or contract to which the Vendor is a party or to which such
Vendor or any of such Vendor's assets or properties may be subject or
(b) any applicable federal, state, local or foreign judgement, writ,
decree, order, ordinance, statute, rule or regulation applicable to the
Vendor or the Vendor's assets or properties. The consummation of the
purchase of the Vendor's Sale Shares and the other transactions
contemplated by this agreement in so far as applicable to the Vendor
will not require the consent of any third person which has not been
obtained with respect to the rights, licenses, franchises, leases or
agreements of the Vendor.
4. The Vendor hereby acknowledges that the Vendor has read this
agreement, the Escrow Agreement, the Registration Rights Agreement and
the other documents to be delivered in connection with the consummation
of the transactions contemplated hereby in so far as applicable to him
or it and has made an independent examination of the transactions
contemplated hereby (including the tax consequences thereof) in so far
as applicable to him or it. The Vendor acknowledges that the Vendor has
been afforded an opportunity to consult with and has relied upon the
advice, if any, of the individual Vendor's relevant legal counsel,
financial advisors, or accountants with respect to the transactions
contemplated hereby to the extent that each Vendor has deemed necessary
and the Purchaser's Warranties and the other undertakings of the
Purchaser in this agreement and the other documentation contemplated
hereby, and has not been advised or directed by Purchaser, the Company
or their respective officers, employees, legal counsel or other
advisors in respect of any such matters and has not relied on any such
parties in connection with this agreement and the transactions
contemplated hereby in so far as applicable to him or it.
5. The Vendor hereby confirms, that the Consideration Shares to be
allocated or issued to him or it will be acquired for investment for
his or its own account, not as a nominee or agent, and not with a
present intention to resell or distribute any part thereof,
-44-
47
and that the Vendor has no present intention of selling, granting any
participation in, or otherwise distributing the same. The Vendor
further represents that the Vendor does not presently have any
contract, undertaking, agreement or arrangement with any person to
sell, transfer or grant participations to such person or to any third
person, with respect to any of the Consideration Shares. The Vendor has
not been formed for the specific purpose of acquiring the Consideration
Shares.
6. The Vendor understands that the Consideration Shares have not been,
and will not be, registered under the Securities Act, by reason of a
specific exemption from the registration provisions of the Securities
Act which depends upon, among other things, the bona fide nature of the
investment intent and the accuracy of the Vendor's representations as
expressed herein. The Vendor understands that the Consideration Shares
are "restricted securities" under applicable U.S. federal and state
securities laws and that, pursuant to these laws, the Vendor must hold
the Consideration Shares indefinitely unless they are registered with
the Securities and Exchange Commission and qualified by state
authorities, or an exemption from such registration and qualification
requirements is available. The Vendor acknowledges that the Purchaser
has no obligation to register or qualify the Consideration Shares for
resale except as set forth in this agreement and the Registration
Rights Agreement. The Vendor further acknowledges that if an exemption
from registration or qualification is available, it may be conditioned
on various requirements including, but not limited to, the time and
manner of sale, the holding period for the Consideration Shares, and on
requirements relating to the Purchaser which are outside of the
Vendor's control
7. The Vendor understands that the Consideration Shares and any
securities issued in respect of or exchange for the Consideration
Shares, may bear the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT
AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION
THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN
EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF
COUNSEL IN A FORM SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS
NOT REQUIRED UNDER THE SECURITIES ACT OF 1933."
8. If the Vendor is not a United States person (as defined by Section
7701(a)(30) of the United States Internal Revenue Code of 1986, as
amended), such Vendor hereby represents that it has satisfied itself as
to the full observance of the applicable laws of its jurisdiction in
connection with any invitation to subscribe for the Consideration
Shares including (i) the legal requirements within its jurisdiction for
the purchase of the Consideration Shares, (ii) any foreign exchange
restrictions applicable to such purchase, (iii) any governmental or
other consents that may need to be obtained, and (iv) the income tax
and other tax consequences, if any, that may be relevant to the
purchase, holding, redemption, sale, or transfer of the Consideration
Shares.
-45-
48
PART B
COMMERCIAL WARRANTIES
The Company
1.1 The Company has since its inception carried on the
business of a research and development company.
2. The share capital
2.1 The Sale Shares constitute the whole of the issued and
allotted share capital of the Company. All of the Sale Shares
are fully paid or credited as fully paid.
2.2 There is not outstanding any loan capital of the Company.
2.3 Other than as set forth in clause 2.1 of this schedule and
in the Warrantors' Disclosure Letter, there are no other
outstanding shares of capital stock or voting securities of
the Company, and there are no other options, warrants, calls,
rights, commitments or agreements of any character to which
the Company is a party or by which it is legally bound
obligating the Company to issue, deliver, sell, repurchase or
redeem, or cause to be issued, delivered, sold, repurchased or
redeemed, any shares of the capital stock of the Company or
obligating the Company to grant, extend or enter into any such
option, warrant, call, right, commitment or agreement.
3. Information Provided
3.1 The facts set out in the specific disclosures set out in
the Warrantors' Disclosure Letter (but excluding any documents
annexed to the Warrantors' Disclosure Letter which are dealt
with in paragraphs 3.2 and 3.3 below) are true and accurate in
all material respects.
3.2 With regard to documents annexed to the Warrantors'
Disclosure Letter and which are the product of the Warrantors,
the facts (but expressly excluding any expressions of opinions
or matters relating to financial matters) are true and
accurate in all material respects.
3.3 With regard to any documents annexed to the Warrantors'
Disclosure Letter (other than those documents referred to in
paragraph 3.2 above), the Warrantors have provided such
documents to the Purchaser in good faith and, so far as the
Warrantors are aware, the facts (but expressly excluding any
expressions of opinion or matters relating to financial
matters) set out in such documents are not misleading in any
material respect.
-46-
49
3.4 So far as the Warrantors are aware every document annexed
to the Warrantors' Disclosure Letter is a true and complete
copy of the originaL
4. The Accounts
4.1 A true, complete and accurate copy of the Accounts is
annexed to the Warrantors' Disclosure Letter.
4.2 The Accounts were prepared by the Company's Accountants
under the historical cost convention and complied with and
were prepared in accordance with all applicable Accounting
Requirements.
4.3 The Accounts:
(a) give a true and fair view of the assets and
liabilities of the Company as at the Accounts Date
and of its losses for the Financial Year ended on the
Accounts Date;
(b) make appropriate provision for, reserve for or
disclose, as appropriate and to the extent required
by relevant Accounting Requirements, all liabilities,
whether actual, contingent, unquantified or disputed,
all capital commitments, whether actual or
contingent, and all bad or doubtful debts of the
Company as at the Accounts Date in each case, in
accordance with all applicable Accounting
Requirements; and
(c) make appropriate provision for or reserve for
deferred Taxation in accordance with all applicable
Accounting Requirements.
4.4 In the Accounts fixed assets have been depreciated in
accordance with SSAP 12 as amended by FRS 3.
4.5 No amount included in the Accounts in respect of any
asset, whether fixed or current, exceeds its purchase price or
its production cost (as defined in the Companies Act) or (in
the case of current assets) its estimated net realisable value
as at the Accounts Date.
4.6 The values attributed to the assets of the Company in the
Accounts as at the Accounts Date are such that if sold or
realised at that value:
(a) no claim for corporation tax in respect of any
chargeable gain would be made; and
(b) no liability to Taxation would arise as a result
of any claim in respect of a balancing charge,
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50
and, so far as the Warrantors are aware, none of such assets has been
acquired for any consideration in excess of its net realisable value as
at the date of such acquisition or otherwise than by way of a bargain
at arm's length.
5.
There is no paragraph 5
6. Position since the Accounts Date
6.1 Save as disclosed in the Warrantors' Disclosure Letter,
since the Accounts Date:
(a) no dividend or other distribution (within the
meaning of that expression as contained in section
209 or 210 or 418 of ICTA) has been declared, paid or
made by the Company;
(b) the Company has carried on its business in the
ordinary and usual course without any interruption in
its nature, scope or manner and so as to maintain the
same as a going concern;
(c) the Company has not written off any debt in
excess of L 10,000 and no debt has been released by
the Company on terms that the debtor pays less than
the book value of its debt:
(d) the Company has not entered into any contract
involving expenditure on capital account or the
purchase of any capital equipment or other items of a
capital nature of a value in excess of L 10,000;
(e) the Company has not made any disposal or deemed
disposal which might give rise to a liability for
corporation tax on chargeable gains otherwise than in
the ordinary course of trade;
(f) the Company has not acquired or disposed of or
agreed to acquire or dispose of any business or any
material asset or assumed or acquired any material
liability (including any contingent liability)
otherwise than in the ordinary course of business;
(g) there has been no material adverse change in the
assets, liabilities or financial position of the
Company and no event, fact or matter has occurred
which will or is likely to give rise to any such
change;
(h) the Company has not disposed of or agreed to
dispose of any asset for a consideration payable by
instalments where any instalment remains unpaid;
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51
(i) the Company has paid its creditors in accordance
with normal payment procedures of the Company,
details of such procedures being disclosed in the
Warrantors' Disclosure Letter;
(j) none of the assets of the Company has been
diminished by any negligent, unlawful or fraudulent
act of the Warrantors; and
(k) no provision in the accounting records of the
Company (within the meaning of Section 221 of the
Companies Act) has been released; and
7. Accounting and Other Records
7.1 All the accounting records of the Company (as defined in
Section 221 of the Companies Act) have been properly kept in
accordance with sections 221 and 222 of the Companies Act, are
within the Company's possession and control and all
transactions relating to its business have been duly and
correctly recorded in all material respects therein and such
accounting records taken together disclose with reasonable
accuracy, at the date of this agreement, the financial
position of the Company at such time.
7.2 A copy of all written agreements, deeds and other
instruments entered into by the Company are in its possession
and controL
8. Constitution
8.1 A true, complete and accurate copy of the memorandum and
articles of association of the Company having embodied within
it or annexed to it a copy of each resolution or agreement
referred to in section 380 of the Companies Act is annexed to
the Warrantors' Disclosure Letter. Such documents contain full
details of the rights and restrictions attached to the share
capital of the Company, and all such resolutions have been
properly passed as resolutions of the Company and filed with
the Registrar of Companies within the period for filing
required under the Companies Act.
8.2 The register of members and statutory books of the Company
contains a complete, true and accurate record of the members
of the Company and all the other information which they are
required to contain under the Companies Act and comply with
all the requirements of the Companies Act and all returns
particulars resolutions and other documents required to be
delivered by the Company to the Registrar of Companies have
been duly delivered within the time limits required under the
Companies Acts and, so far as the Warrantors are aware, no
fines or penalties are outstanding or known to be due.
8.3 The Company has not received any written notice of any
application or intended application for the rectification of
its register of members.
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52
8.4 The only directors of the Company immediately prior to
Completion are the persons whose names are listed in the
Warrantors' Disclosure Letter and the Company has no alternate
or shadow directors.
8.5 The Company has not provided any financial assistance
within section 151 of the Companies Act or otherwise directly
or indirectly for the purchase or the proposed purchase of its
own shares.
8.6 The Company has not purchased any of its own shares.
8.7 The Company has no assets outside the United Kingdom nor
does it have a branch, agency or place of business or any
permanent establishment (as that expression is defined in the
relevant double taxation relief orders current at the
Completion Date) outside the United Kingdom.
8.8 The Company has no shares or other securities in any other
company and has not agreed to acquire any such shares or
securities or held any such shares or securities at any time.
The Company does not take part in the management of any other
company, firm, association or business organisation.
8.9 No share in the capital of the Company has been issued or
transferred otherwise than in accordance with the memorandum
and articles of association of the Company from time to time
in force.
9. Bank Accounts and Indebtedness
9.1 A statement of all the bank accounts and the building
society accounts and other investment accounts and of the
credit or debit balances thereon of the Company as at no later
than the 5th business day prior to the Completion Date is
annexed to the Warrantors' Disclosure Letter and since such
statement there have been no payments out of any such accounts
otherwise than in the ordinary course of trade; and there are
no unpresented cheques drawn by the Company for sums exceeding
in the aggregate L 10,000.
9.2 The Company has not incurred any indebtedness in the
nature of borrowings which it has not repaid in full or
satisfied.
9.3 The amounts borrowed by the Company do not exceed any
limitation on its borrowing contained in its articles or
association or in any debenture or other deed or document
legally binding upon the Company and the Company has not
incurred any indebtedness except indebtedness arising in the
ordinary course of business
9.4 The Company has never had and has no bank overdraft
facilities or agreements, acceptance credits or other
financial facilities outstanding or available
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53
to it under any existing arrangements between the Company and
any lender in place on the Completion Date.
9.5 Since the Accounts Date, the Company has not engaged in
financing of a type which would not require by law or
Accounting Requirements to be shown or reflected in the
Accounts, had such arrangement or financing been entered into
prior to the Accounts Date.
9.6 The Company has not entered into or agreed to enter into
any performance or other bonds and no such bonds have been
given by any other person on behalf of the Company or in
relation to any of its obligations.
9.7 There is not, except for the registered charges material
details of which are set out in the Warrantors' Disclosure
Letter or retention of title provisions arising through the
ordinary course of trade, any Encumbrance of any nature
(including a conditional obligation) on or affecting the
assets or property or any part of the assets or property of
the Company nor any debenture whether secured or otherwise or
floating charge.
9.8 All charges by or in favour of the Company have been
registered in accordance with the provisions of the Companies
Act or comply with all necessary formalities as to
registration or otherwise in any other relevant jurisdiction;
and the registered particulars of all charges over any assets
of the Company are complete and accurate in all material
respects.
10. Debts/Unpaid Liabilities
10.1 No part of the sum shown in the Accounts in respect of
debtors is represented by debts which were then more than 90
days overdue for payment and not provided for therein.
10.2 Except to the extent to which provision or reserve is
made in the Accounts the Warrantors are not aware of any
reason why all debts owed to the Company and reflected in the
Accounts will not realise their full value and be good and
collectable within 90 days of their due date for payment in
the normal course of business, and, so far as the Warrantors
are aware, none of such debts is subject to any counterclaim
or set-off.
10.3 The Company is not owed any sums other than debts
incurred in the ordinary course of trading.
10.4 The Company does not have any unpaid liability where the
relevant ▇▇▇▇ or account was received more than 90 days prior
to the Completion Date.
10.5 The Company is not the guarantor of any debt or unpaid
liability of any other party.
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54
11. Assets
11.1 The Company has no plant and machinery.
11.2 All vehicles and office furniture and equipment used by
the Company are its property both legally and beneficially and
the Company has a good and valid title thereto and none is the
subject of any Encumbrance.
11.3 All office furniture and equipment owned and/or used by
the Company are in its possession and control and are in
reasonable repair and condition fair wear and tear excepted
having regard to their age; are regularly maintained in
accordance with applicable technical standards, safety
regulations and the provisions of any applicable agreement and
are in satisfactory working order.
11.4 Copies of maintenance contracts for the assets of the
Company (except for the Computer System) which have maintained
by independent or specialist contractors are annexed to the
Warrantors' Disclosure Letter.
11.5 The list of assets of the Company annexed to the
Warrantors' Disclosure Letter comprises a record of all the
vehicles, equipment, furniture and other assets owned or
possessed by the Company and such list is true and complete in
all material respects.
11.6 Save as disclosed in the Warrantors' Disclosure Letter,
the Company has not entered into any leasing or hiring
agreement, hire purchase agreement, conditional sale or credit
sale agreement, agreement for payment on deferred terms or any
similar agreement or arrangement and is not in material breach
of such agreements.
12. Intellectual Property
(The warranties in this Section 12 do not apply to the Software which
is dealt with in Section 14).
12.1 The Company is the sole legal and beneficial owner of all
the Company IPR (save for the Intellectual Property which is
the subject of the Licenses) and all Company IPR is
subsisting.
12.2 The Company has not entered into any agreements, licenses
or created any Encumbrances affecting to the Company IPR or
restricting its use by the Company in any way and for the
purposes of this Warranty, Encumbrance shall be defined as any
mortgage, security, interest, lien, pledge, hypothecation,
assignment by way of security, right of pre-exemption, option,
charge, covenant or restriction.
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55
12.3 In so far as any of the Patents are registrable within
the territories specified in schedule 3 and save as disclosed
in the Warrantors' Letter:
(a) all relevant registrations and applications
therefor have been made or are in the name of the
Company or (in the case of the Intellectual Property
which is the subject of the License Agreement) the
Roslin Institute (Edinburgh), Biotechnology and
Biological Sciences Research Council and Ministry of
Agriculture, Fisheries and Food ("the Patent
Proprietors");
(b) all application and renewal fees due to date have
been duly paid; and
(c) The Company (and in relation to the Intellectual
Property which is the subject of the License
Agreement, the Patent Proprietors) has done
everything necessary to date in relation to such
applications for registrations and all such
applications are proceeding normally and there are no
material facts of which the Warrantors are aware
which could significantly undermine those
applications or reduce to a significant extent the
scope of protection of any patents arising from such
applications.
12.4 There are no circumstances which could entitle a third
party (including any of the Warrantors) to a license,
permission, consent or assignment of or in respect of any of
the Company IPR or to call for or exercise any right to use or
work under any of the Company IPR or which could provide a
third party with a defence to patent infringement proceedings
under section 44 Patents Act or any provision having an
equivalent effect in any jurisdiction.
12.5 Except for matters done in the course of applying for and
prosecuting the Patents, nothing has been done or omitted to
be done by the Company or the Patent Proprietors whereby any
person is able to obtain cancellation or rectification or any
other modifications of any registration of any of the Patents
in any jurisdiction in which they are currently applied for.
12.6 As far as the Warrantors are aware the Company does not
own or use either individually or with any person any
Intellectual Property other than the Company IPR.
12.7 There is no impediment or restriction on the Company's
use and exercise of any of the Company IPR and so far as the
Warrantors are aware the use and exercise does not constitute
an infringement of any intellectual property owned by any
third party.
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56
12.8 Neither the Company nor any of the directors or employees
or consultants of the Company are party to or bound by an
agreement for sharing, exchanging, passing or otherwise
transferring Company IPR to any third party.
12.9 No notice of any actions, claims, counterclaims,
applications or allegations impugning the validity or
enforceability of any of the Patents Agreements or (save in
relation to Intellectual Property which is the subject of the
License) the Company's ownership thereof has been received by
the Company and all material facts of which the Warrantors are
aware that such a claim is going to be made by any third party
has been Disclosed.
12.10 The Company has put in place procedures set out in the
Warrantors' Disclosure Letter designed to ensure that no act
is done or omitted to be done which has resulted or which may
result or is capable of resulting in any breach or
infringement of any third party's Intellectual Property.
12.11 The Warrantors Disclosure Letter comprises a complete
list of all licenses (other than implied licences) and
agreements pursuant to which the Company uses any Intellectual
Property owned by any third party. No notice to terminate, or
of any breach or material dispute of, any of the Licenses or
agreements so disclosed has been served by or received by the
Company and so far as the Warrantors are aware the Company has
not done or omitted to do any act which could amount or result
in any such breach.
12.12 As far as the Warrantors are aware, the Licensors have
at all times performed and observed the terms of the Licenses
in all material respects.
12.13 The Company has not made any claim or allegation against
any third party alleging infringement of any of the Company
IPR and so far as the Warrantors are aware, there are no
facts, matters or circumstances which could give rise to any
such action, claim or allegation.
12.14 The Company has not received notice of any claims
against the Company under any contract or under the Patents
Acts (or otherwise) for employee compensation in respect of
any Company IPR or any other like claim by a self-employed
contractor.
12.15 The Company IPR includes a list of all registered
intellectual property rights held by the Company which is
complete in all material respects.
12.16 The trade marks listed in Part 3 of the schedule
comprise all the trademarks used by the Company in connection
with its business.
12.17 The Company does not own or use any brand, trade or
business name in connection with its business other than the
trade marks listed in Part 3 of the Schedule.
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12.18 The Confidential Information has at all times been
maintained by the Company so as to endeavour to preserve its
confidentiality. In so far as the Confidential Information or
any part thereof has been disclosed to any third parties it
has been disclosed under the terms of the confidentiality
agreements listed in the Warrantors' Disclosure Letter.
12.19 The Company has not registered any trade marks or design
rights.
13. Employees and Consultants
13.1 The particulars of the name, job title, date of
commencement of employment and/or appointment to office, age,
notice period, salary, benefits (pecuniary or otherwise),
confidentiality obligations and all other written terms and
conditions of employment or engagement of each director,
consultant or employee of the Company set out in the
Warrantors' Disclosure Letter are true and accurate in all
material respects.
13.2 There are no outstanding offers of employment or
engagement made to any person by the Company and there is no
one who has accepted an offer of employment or engagement made
by the Company but who has not yet taken up that employment or
engagement.
13.3 All service and employment agreements entered into by the
Company and in force may be terminated by not more than six
months' notice and without payment of compensation or damages
(other than any payments arising under statute or payment for
wrongful dismissal). All consultancy agreements entered into
by the Company may be terminated by not more than six months'
notice without giving rise to any claim for damages or
compensation.
13.4 No director, employee or, so far as the Warrantors are
aware, consultant of the Company:
(a) has given or received notice terminating his
employment or engagement or altering its terms, and
no such person will be entitled as a result of the
entering into of this agreement to give notice of
termination or to claim for any payment or benefit or
to treat himself as being released from any
obligation; or
(b) is currently on sick leave which (as of the
Completion Date) has been continuing for more than 14
consecutive days; or
(c) is currently on maternity leave.
13.5 There are no outstanding arrears of salary, wages,
holiday pay or other remuneration due to any of the Company's
directors, consultants or employees.
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13.6 Save as disclosed in the Warrantors' Disclosure Letter,
since the Accounts Date:
(a) no change has been made in the rate or basis of
remuneration, fee or the pension or other benefits
paid to or provided for any director, consultant or
employee of the Company; and
(b) no change has been made in any other terms of
employment or engagement of any such director,
consultant or employee.
13.7 The Company has not entered into any agreement or given
any assurance (whether legally binding or not) or created any
expectation regarding any future variation in any contract of
employment or so far as the Warrantors are aware in any
consultancy agreement in respect of any of its directors,
employees or consultants or any agreement imposing an
obligation on the Company or any expectation on the part of
any director, employee or, so far as the Warrantors are aware,
consultant to increase the basis and/or rates of remuneration
or payment and/or the provision of other benefits to or on
behalf of any of its directors, employees or consultants at
any future date.
13.8 The Company does not operate any share option scheme,
employee trust, cash bonus scheme or other employee incentive
arrangement.
13.9 The Company has not entered into any union membership,
security of employment, redundancy, recognition or other
collective agreement (whether legally binding or not) with a
trade union, association of trade unions, works council, staff
association or other organisation or body of employees, nor
has the Company done any act which might be construed as
recognition, nor has the Company in respect of any employee
entered into any agreement with any trade union or other
employee body representing employees concerning the
introduction of new equipment or technology.
13.10 The Company is not involved in any industrial or trade
dispute or any dispute or negotiation regarding a claim of
material importance or the dismissal or varying of the terms
and conditions of employment of any present or former employee
and there are no facts known to the Warrantors which indicate
that there may be any such dispute or negotiation.
13.11 No disciplinary action, whether formal or informal, has
been taken against and no grievance or complaint of sex, race
or disability discrimination, whether formal or informal, has
been raised with the Company by any employee since the
Company's inception.
13.12 The Warrantors are not aware of any facts or matters
affecting any of the employees of the Company which might
reasonably be considered grounds for
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dismissing such employee or for warning such employee that the
continuation of any conduct or behaviour might lead to
dismissal and no warning (whether formal or informal) has been
given to any employee and no notice of termination of
employment has been given to or received from any such
employee.
13.13 Insofar as the Warrantors are aware, no past or present
director, employee or consultant has asserted any claim
against the Company for loss of office or arising out of the
termination of his office or employment or in respect of any
accident or injury which does not fall within the Company's
insurances and so far as the Warrantors are aware there is no
event which would or might reasonably be expected to give rise
to any such claim.
13.14 Insofar as the Warrantors are aware, no liability has
been or may be incurred by the Company for breach of any
contract of service or for services, for redundancy payments,
protective awards or for compensation for wrongful dismissal
or unfair dismissal or for failure to comply with any order
for the reinstatement or re-engagement of any employee or for
any other liability accruing from the actual or proposed
termination or variation of any contract of employment or for
services.
13.15 No gratuitous payment has been made or promised by the
Company:
(a) in respect of or contingent upon the sale of the
Sale Shares; or
(b) in connection with the actual or proposed
termination or suspension of employment or engagement
or variation of any contract of employment or
engagement of any present or former director,
consultant or employee.
13.16 So far as the Warrantors are aware, all monies paid or
goods or services provided directly or indirectly or made
available (whether by way of the provision of a credit card or
otherwise howsoever) by the Company whether as principal or
surety to any of its directors or employees whether in respect
of emoluments of employment or reimbursement or otherwise
howsoever have been expenditures properly incurred by the
Company so as to be deductible in computing its taxable
profits and have been declared to the Inland Revenue.
13.17 There is no person previously employed by the Company
who now has right to return to his work or in respect of whom
the Company has been ordered by an Employment Tribunal that he
be reinstated by the Company under the provisions of the
Employment Rights ▇▇▇ ▇▇▇▇.
13.18 The Company has not made any loans or quasi loans (as
defined in the Companies Act) to or entered into any credit
transaction (as so defined) with any of its directors or
employees.
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13.19 No person has been employed since the inception of the
Company who requires a work permit without such a permit being
in force.
13.20 Since its inception, the Company has not been a party to
any relevant transfer as defined in the Transfer of
Undertakings (Protection of Employment) Regulations 1981 nor
has the Company failed to comply with any duty to inform and
consult any independent trade union under such Regulations.
13.21 So far as the Warrantors are aware save as provided or
contemplated by this agreement, no director, consultant or
employee will leave the employment or engagement of the
Company as a result of the signing of this agreement or the
matters or transactions effected by it.
13.22 So far as the Warrantors are aware the Company has in
relation to each of its directors and employees (and so far as
relevant to each of its former directors and employees)
complied with all obligations imposed on it by Article 119 of
the Treaty of Rome, the Trade Union and Labour Relations
(Consolidation) ▇▇▇ ▇▇▇▇, the Employment Rights ▇▇▇ ▇▇▇▇ and
all other statutes, regulations, codes of conduct and
practices relevant to relations between the Company and its
directors and employees and the Company has maintained
adequate and suitable records regarding their services.
13.23 The Company's only employees are Simon Best, Piers
Lincoln and ▇▇▇ ▇▇▇▇▇.
13.24 The Company's only consultants are as set out in the
Warrantors' Disclosure Letter.
13.25 I ▇▇▇▇▇ is not entitled to any payments under his
contract of employment other than in respect of his notice
period.
14. Transaction with Warrantor's Affiliates and Computer
Systems
14.1 There are no:
(a) loans made by the Company to any of the
Warrantors and/or to any director of the Company
and/or to any Warrantor's Affiliate of any of the
Warrantors or of any such director;
(b) debts owing to the Company by any of the
Warrantors and/or any director of the Company and/or
by any Warrantor's Affiliate of any of the Warrantors
or of any such director.
14.2 there are no existing legally binding contracts,
transactions or arrangements to which the Company is a party
or under which it may be liable and in which any of the
Warrantors and/or any director of the Company and/or any
Warrantor's
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Affiliate of any Warrantor's and/or any Warrantor's Affiliate
of any director is interested whether directly or indirectly
to any material extent, and, so far as the Warrantors are
aware, the Company has not been a party to any such contracts,
transactions or arrangements since its inception.
14.3 None of the Warrantors nor any director of the Company is
engaged or concerned or interested in any way whatsoever (and
whether by a holding of shares or otherwise other than any
company quoted on a recognised stock exchange, as defined in
the Companies Act) in any other business of a similar nature
to or competitive with that carried on by the Company.
14.4 Save in relation to services provided to the Company
pursuant to a Warrantor's employment contract with the Company
the Company does not depend in any material respect upon the
use of any property, right, asset owned by, or facilities or
services provided by any Warrantor or any Warrantor's
Affiliate.
14.5 The Company has experienced no material or significant
mechanical or software failure in respect of the Computer
System at any time and the Computer System is effective and
operational in all material respects.
14.6 The Company has disaster recovery protection for its
Computer System and all data has been backed up periodically.
14.7 The Company is the beneficial owner free from
Encumbrances of all the items of equipment, hardware, firmware
and accessories relating to the Computer System and no other
person has any claims or rights in respect thereof.
14.8 The Company has all the necessary licences to use the
Software in the conduct of its business.
14.9 Insofar as any Software has been licensed by the Company
from any third parties the Company is not in dispute with any
licensor and has not done, or omitted to do, any act which
might entitle such licensor to terminate that license.
14.10 All information and data held by the Company on the
Computer System is beneficially owned by the Company free from
Encumbrances, and the Company is not subject to any
restriction with regard to the use thereof and no third party
enjoys any right or permission to copy or hold any such
information or data.
14.11 There are in existence maintenance and support
agreements in respect of all equipment, hardware, firmware,
Software and accessories used in the Computer System, and the
Company has not done, or omitted to do, any act which might
entitle the provider of the maintenance and support services
to terminate such agreements or to withhold or refuse to
supply any services thereunder; and the
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Company is not in dispute with such provider regarding its
maintenance and support obligations.
14.12 The Computer System comprises all equipment, hardware,
firmware, software, including object code, supporting
materials and accessories which are reasonably necessary to
enable the Company to carry on its business in the same manner
and to the same extent as it has been carried on prior to the
Completion Date and the rights to use the Computer System or
any part thereof will not be adversely affected by the
transactions effected by this agreement.
14.13 The Company has put in hand all necessary steps to
ensure that prior to 31 December 1999 the Computer System and
all Software will be Year 2000 Compliant and will comply with
all updates of the BSI-DISC PD 2000-1 standard which have been
published prior to the Completion Date and the Warrantors have
no reason to believe that such steps will not be successful by
that date.
15. Material Contracts
15.1 There is not outstanding any agreement or arrangement to
which the Company is a party:
(a) which was entered into otherwise than at arm's
length;
(b) which requires (or confers any right to require)
the allotment or issue of any shares, debentures or
other securities of the Company now or at any time in
the future;
(c) which establishes any guarantee, indemnity,
suretyship or legally binding comfort arrangement
given by the Company in respect of the obligations or
solvency of any third party;
(d) which establishes any joint venture, co-operation
agreement or arrangement, consortium or profit (or
loss) sharing agreement or arrangement;
(e) which involves future capital expenditure by the
Company in excess of L 10,000;
(f) which, by virtue of the execution of this
agreement or acquisition of the Sale Shares by the
Purchaser or other performance of the terms of this
agreement will or may result in: (i) any third party
being relieved of any material obligation or becoming
entitled to exercise any right (including a right of
termination or any right of pre-emption or other
option); or (ii) the Company being in material
default under any such agreement or arrangement or
losing any benefit, right or license which it
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currently enjoys or (iii) a liability or obligation
of the Company being created or increased to any
material extent;
(g) which will result in the Company becoming liable
for any finder's fee, brokerage or other commission
in connection with the acquisition of the Sale Shares
by the Purchaser;
(h) to which any of the provisions of section 317,
320 or 330 of the Companies Act apply;
(i) pursuant to which the Company has sold or
otherwise disposed of any assets or undertaking in
circumstances such that it remains subject to any
liability (whether contingent or otherwise) which
would not normally be retained by a vendor of any
assets or undertaking and which is not adequately
provided for in the Accounts;
(j) which is a power of attorney given by the Company
or any other authority other than authority given to
a director of the Company which would enable any
person to enter into any legally binding contract or
commitment on behalf of the Company;
(k) which establishes any agency, distributorship,
OEM, marketing, purchasing, licensing, management or
administration agreement or arrangement of a material
nature;
(l) which involves payment by reference to
fluctuations in the index of retail prices, or any
other index, or in the rate of exchange of any
currency or any interest rate;
(m) which save for service, consultancy and
employment agreements has more than three months left
to run and is not capable of being terminated by
three months' notice or less without payment of
compensation or damages;
(n) which is a sale or purchase option or similar
agreement or arrangement affecting any assets owned
or used by the Company; or
(o) save to the extent relating to Company IPR,
restricting the freedom of the Company to provide and
take goods and services by such means and from and to
such persons as it may from time to time think fit.
15.2 Disclosure is made in the Warrantors' Disclosure Letter
of any negotiations or offers or the like which are capable or
likely to result in the Company entering into any agreement or
arrangement of a kind described in paragraphs 15.1(a) to (o)
above.
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15.3 The Company has not assigned or sublet any of its rights
under and so far as the Warrantors are aware is not in default
under any agreement or arrangement of a kind described in
clause 15.1(a) to (o) above to which it is a party and so far
as the Warrantors are aware there are no circumstances likely
to give rise to any such default, and no other party thereto
is in default of any such agreement or arrangement and there
are no circumstances expected to give rise to any such
default.
15.4 So far as the Warrantors are aware, no agreement or
transaction to which the Company is a party is invalid or
ultra ▇▇▇▇▇ and, so far as the Warrantors are aware, there are
no grounds for rescission, breach, avoidance or repudiation of
any agreement or other transaction to which the Company is a
party.
16. Investment Grants
16.1 The Company has not received any investment grant,
building ▇▇▇▇▇, ▇▇▇▇▇ under any Local Employment Act or under
the Industry Acts or any other grant or allowance or loan
subsidy or financial assistance
17. Insolvency
17.1 No resolution has been passed or meeting convened for the
winding up of the Company or so far as the Warrantors are
aware for an administration order in respect of the Company;
so far as the Warrantors are aware, no administrative receiver
has been appointed of the business or the whole or any part of
the assets or undertaking of the Company; and so far as the
Warrantors are aware, there are no circumstances likely to
give rise to the appointment of any such administrative
receiver or liquidator.
17.2 There are no unfulfilled or unsatisfied judgements or
court orders outstanding against the Company.
17.3 No distress, distraint, charging order, garnishee order,
execution or other process which a court or a similar body may
use to enforce payment of a debt has been levied or, so far as
the Warrantors are aware, applied for in respect of the whole
or any part of the property, assets or undertaking of the
Company.
17.4 In relation to any property or assets held by the Company
under any hire, hire purchase, conditional or credit sale,
leasing or retention of title agreement or otherwise belonging
to a third party, so far as the Warrantors are aware no event
has occurred which entitles, or which upon intervention or
notice by the third party may entitle, the third party to
repossess the property or assets concerned or to terminate the
agreement or any license in respect thereof.
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17.5 The Company has not stopped payment nor is it insolvent
or unable to pay its debts for the purposes of section 123 of
the Insolvency ▇▇▇ ▇▇▇▇.
17.6 So far as the Warrantors are aware, the Company has not
been a party to any transaction with any third party which, in
the event of such third party going into liquidation or an
administration order or a bankruptcy order being made in
relation to it or to him, would constitute (in whole or in
part) a transaction at an undervalue, a preference, an invalid
floating charge or an extortionate credit transaction or part
of a general assignment of debts, under sections 238 to 245
and sections 339 to 344 of the Insolvency ▇▇▇ ▇▇▇▇.
17.7 No person who at present is, or who any time since the
Company's inception was, a director or officer of the Company
is, or at any material time was , subject to any
disqualification order under the Companies ▇▇▇ ▇▇▇▇ or under
any other legislation relating to the disqualification of
directors and officers or so far as the Warrantors are aware
was the subject of any investigation or proceedings capable of
leading to a disqualification order being made.
18. Regulatory Matters
18.1 There are now in force and effect all approvals, permits,
authorities, consents and licenses of a regulatory nature
which the Warrantors believe are necessary for the proper
carrying on of the Company's business in the places and in the
manner in which such business is now carried on.
18.2 The approvals, permits, authorities, consents and
licenses referred to in clause 18.1 above are not subject to
any unusual or onerous conditions having regard to the
conditions which are or may be imposed on approvals, permits,
authorities, consents and licenses granted to the third
parties carrying on a similar business and the nature of the
Company's business and the Company has complied in all
material respects with all conditions attached to such
approvals, permits, authorities, consents and licenses in so
far as applicable to the Company. So far as the Warrantors are
aware, there are no investigations, proceedings, enquiries,
communications or other circumstances which mean that any such
approvals, permits, authorities, consents and licenses would
be revoked, cancelled, suspended, modified or not renewed.
18.3 The Company has at all times carried on its business in
all material respects in accordance with its memorandum and
articles of association and, so far as the Warrantors are
aware, all applicable laws and regulations (whether in the
United Kingdom or any other jurisdiction).
18.4 The Company has registered as a data user under Data
Protection Act 1984 for all purposes and activities of the
Company for which registration is required and, so far as the
Warrantors are aware, has complied in all material respects
with all other applicable requirements of such Act.
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18.5 No outstanding written notices in relation to any
statutory obligation have been served on the Company by any
competent regulatory or governmental authority in respect of
any of its assets or in respect of any contravention or
non-compliance with or alleged contravention or non-compliance
with any applicable statutory or regulatory obligation.
18.6 The Company is not a party to any agreement, arrangement
or concerted practice and is not carrying on any practice
which in whole or in part:
(a) is or requires to be registered under the
Restrictive Trade Practices Act 1976 (whether or not
such agreement, arrangement or concerted practice is
a non notifiable agreement for the purposes of
section 27a of the Restrictive Practices Act 1976);
(b) contravenes Articles 85 or 86 of the Treaty of
Rome or Articles 53 or 54 of the agreement
constituting the European Economic Area or which has
been notified to the European Commission or the EFTA
Surveillance Authority for a negative clearance or
exemption or which ought to have been so notified
(other than falling under the Commission's Notice on
agreements of minor importance);
(c) has been notified by the Company to the Office of
Fair Trading for "early guidance" pursuant to
schedule 13, paragraph 7 of the Competition ▇▇▇ ▇▇▇▇;
(d) so far as the Warrantors are aware, contravenes
or is invalidated by any competition, anti-trust,
regulatory, monopoly, fair trading, consumer
protection or similar legislation in any jurisdiction
where the Company has any assets or carries on
business.
18.7 The Company has not received any process, notice or
communication (formal or informal) by or on behalf of the
Office of Fair Trading, the Monopolies and Mergers Commission,
the Secretary of State for Trade and Industry, any regulator
within the meaning of section 54 of the Competition ▇▇▇ ▇▇▇▇,
the Commission of the European Communities or the EFTA
Surveillance Authority or any authority having jurisdiction in
competition, anti-trust, regulatory, monopoly, fair trading or
consumer protection matters of an adverse nature in relation
to any aspect of the business of the Company or any agreement
or arrangement to which it is or is alleged to be a party, and
so far as the Warrantors are aware no circumstances exist
which might give rise to the Company receiving any such
process, notice or communication.
18.8 Save in relation to Taxation which is dealt with in Part
D of schedule 4, there have not been and so far as the
Warrantors are aware are not pending, or in
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existence, any investigations or enquiries by, or on behalf
of, any governmental or administrative or other body in
respect of any of the affairs of the Company
19. Litigation
19.1 The Company is not a party (whether as plaintiff or
defendant or otherwise) to any claim, litigation, arbitration,
prosecution or other legal or quasi legal proceedings or
enquiry and has not been engaged in any such claim,
proceedings or enquiry since the Company's inception and, so
far as the Warrantors are aware, there are no claims or
actions (whether criminal or civil) pending or threatened or
anticipated by or against the Company or any of its directors,
employees or consultants in relation to the Company or its
business or in respect whereof the Company is liable to
indemnify any party concerned or may be vicariously liable.
19.2 So far as the Warrantors are aware, there are no
investigations, disciplinary proceedings or other material
facts or circumstances likely to lead to any claim, action,
proceeding, suit, litigation, prosecution, investigation,
enquiry or arbitration involving the Company.
20. Insurance
20.1 The Company and its assets are insured against such risks
and in such sums as are disclosed in the Warrantors'
Disclosure Letter and, so far as the Warrantors are aware,
none of the transactions contemplated by this agreement will
directly or indirectly alter, invalidate or otherwise affect
such insurance. All premiums due in respect of such insurance
have been fully paid; and the next renewal date for each of
such insurance is a date at least 30 days after the Completion
Date. So far as the Warrantors are aware, all such insurance
is currently in full force and effect, and so far as the
Warrantors are aware, nothing has been done or omitted to be
done which could make any policy of insurance void or
voidable.
20.2 So far as the Warrantors are aware, no claim is
outstanding or is likely to be made under any of such
insurance and so far as the Warrantors are aware no
circumstances exist which are likely to give rise to any such
claim.
20.3 So far as the Warrantors are aware, there are no claims
capable of arising against the Company by an employee, a
▇▇▇▇▇▇▇ or any other third party, in respect of any accident
or injury, which do not fall within the insurances effected by
the Company.
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PART C
PROPERTY AND ENVIRONMENTAL WARRANTIES
1. The Company has no legal or beneficial interest in any property or
premises.
2. So far as the Warrantors are aware no Hazardous Materials have
migrated from the premises occupied by the Company onto or beneath
other properties or are likely to do so.
3. The Company has not illegally managed or illegally allowed to escape
from its control or transferred to an unauthorised person in breach of
the Environmental Protection Act 1990 any controlled waste as defined
in the said Act.
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PART D
TAX WARRANTIES
1. Reserve for Taxation in the Accounts
1.1 The Accounts make adequate reserve or provide for all
Taxation to the extent required by the Accounting Requirements
for which the Company was in respect of the period ending on the
Accounts Date liable and the Accounts make proper reserve for or
contain a note regarding any contingent liability or possible
deferred liability to Taxation to the extent required by the
Accounting Requirements.
2. Returns and Payment of Taxation
2.1 Other than in respect of VAT which is dealt with in clause
14 below all returns, computations and notices or information
which should have been made by law by the Company for the
purposes of Taxation in respect of any accounting period up to
the Accounts Date (i) have been made punctually and are correct
in all material respects, (ii) contain all information required
by law for all the purposes of Taxation and (iii) are not the
subject of any dispute with the Inland Revenue or H M Customs &
Excise or the Department of Employment or other relevant or
appropriate authority as of the Completion Date; and the Company
is not involved in any material dispute with the Inland Revenue
or other relevant or appropriate authority concerning any matter
likely to affect in any way the liability (whether accrued,
contingent or future) of the Company to Taxation and is under no
liability to pay any penalty or interest in connection with any
claim for Taxation.
2.2 No corporation taxation computations of the profits and
losses of the Company and of its liability to such Taxation for
the accounting periods ending since the Company's inception have
not been agreed with the Inland Revenue or other appropriate
authority.
2.3 Other than in respect of VAT which is dealt with in clause
14 below the Company has duly and punctually paid to the Inland
Revenue or other appropriate authority all Taxation (if any) for
which it is legally liable as a result of any act or omission of
the Company prior to the Completion.
2.4 Other than in respect of VAT which is dealt with in clause
14 below the Company has duly and punctually deducted, withheld,
or collected for payment (as appropriate) all Taxation (if any)
which it has become legally liable to deduct, withhold or
collect for payment and has paid all such Taxation to the Inland
Revenue or other appropriate authority.
2.5 There are set out in the Warrantors' Disclosure Letter
particulars of all notifications and notices received by the
Company under section 166 of ICTA.
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2.6 No material failures have occurred in operating the PAYE and
National Insurance Contributions systems and the Company has
kept and maintained records which are correct and up-to-date in
all material respects for the purposes of the legislation
relating thereto.
2.7 The Company has not, since its inception, paid or become
liable to pay any fine, penalty or interest charged by virtue of
the provisions of the Taxes Management Act of 1970 or similar
provisions in other countries.
2.8 The Company has not, since its inception, been the subject
of a PAYE audit and no formal notification has been received
from the Inland Revenue that an investigation by the Inland
Revenue is underway.
2.9 Other than in respect of VAT which is dealt with in clause
14 below, no transaction has been entered into by the Company
since the Accounts Date in respect of which the Company is
required to make a specific return or to provide information to
a relevant Taxation Authority and in respect of which the time
for making such return or providing such information will expire
on or after the Completion.
3. Tax Clearances
3.1 Since the date of inception of the Company, no transaction
has been entered into by the Company in respect of which any
consent or clearance from the Inland Revenue or other
appropriate Taxation or governmental authority was required.
4. Base Values and Acquisition Costs
4.1 Save as disclosed in the Warrantors' Disclosure Letter the
aggregate book value (exclusive of any value attributable to an
asset in excess of its cost) of each of the assets of the
Company in or adopted for the purposes of the Accounts does not
exceed the aggregate written-down value of such asset for the
purposes of CAA.
4.2 Save as disclosed in the Warrantors' Disclosure Letter if
each of the capital assets of the Company (excluding, for the
avoidance of doubt, trading stock) were disposed of for a
consideration equal to the book value of that asset in, or
adopted for the purposes of, the Accounts, no liability to
corporation tax on chargeable gains or balancing charge would
arise.
4.3 The Company does not own and has not agreed to acquire or
dispose of any asset, nor has it received or agreed to receive
any services or facilities (including without limitation the
benefit of any licenses or agreements), the consideration for
the acquisition or provision of which was or will be in excess
of its market value or otherwise than on an arm's length basis.
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5. Distributions and Payments
5.1 No security issued by the Company and remaining in issue as
of the Completion was issued in such circumstances that the
interest payable thereon falls to be treated as a distribution
under section 209 of ICTA or section 418 of ICTA.
5.2 The Company has not, since its inception, repaid, or agreed
to repay, or redeemed, or agreed to redeem, or purchased or
agreed to purchase any of its share capital, or capitalised or
agreed to capitalise, in the form of debentures or redeemable
shares, any profits or reserves of any class or description;
5.3 The Company has not issued any share capital to which the
provisions of section 249 of ICTA could apply nor does it own
any such share capital.
6. Taxation Claims, Liabilities and Reliefs
6.1 There are set out in the Warrantors' Disclosure Letter
material details of all matters relating to Taxation in respect
of which the Company (either alone or jointly with any other
person) at the Completion will have, on the basis of current law
and practice as at the Completion Date an outstanding
entitlement:
(a) to make any claim for relief under ICTA or any other
statute relating to Taxation;
(b) to make any election for one type of relief, on one
basis, system or method of Taxation, as opposed to
another;
(c) to make an appeal (including a further appeal)
against an assessment to Taxation;
(d) to make an application for the postponement of, or
the payment by instalments of, any Taxation; or
(e) to disclaim or require the postponement of any
allowance or relief.
6.2 The Company is not, nor will it become, liable to pay, or
make any reimbursement or give any indemnity in respect of, any
Taxation (or any amounts corresponding thereto) in consequence
of the failure of any person to discharge that Taxation within
any specified period, where such Taxation relates to a profit,
income or gain, transaction, event, omission or circumstance
arising, occurring or deemed to arise or occur (whether wholly
or partly) prior to the Completion.
7. Tax Residence and Status
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7.1 The Company has been resident for tax purposes in the United
Kingdom at all times since its incorporation and the Company has
never been resident in any other jurisdiction.
7.2 The Company has not at any time been a trustee of any
settlement for the purposes of Section 260 of TCGA.
8. Disallowance of Deductions
No rents, interest, annual payments, emoluments, management or service
fees or charges or other sums of an income nature (including benefits in
kind) paid or provided by the Company since the Accounts Date or which
the Company is under an obligation to pay or provide in the future are
or may under the law currently in force be wholly or partially
disallowable as deductions or charges in computing profits or against
profits for the purposes of corporation tax by reason of any statutory
provision relating to Taxation.
9. Corporation Tax on Chargeable Gains
9.1 Neither the signing of this agreement nor Completion will
result in any profit or gain being deemed to accrue to the
Company for the purposes of Taxation whether pursuant to section
179 of TCGA or otherwise.
9.2 The Company has not disposed of or acquired any asset in
such circumstances that the provisions of section 17 of TCGA did
or could apply thereto.
9.3 No Taxation is or may become payable by the Company pursuant
to section 189 or 190 of TCGA in respect of any transaction or
event occurring on or prior to the Completion.
9.4 The Company has not at any time made any claim under
sections 152 to 156 or 175 or 247 of TCGA or under any other
analogous provision under UK Taxation legislation which could
affect the amount of any gain accruing or treated as accruing on
a disposal of any asset by the Company; and no claim has been
made by the Company or, so far as the Warrantors are aware, is
capable of being made by any other company which affects or
could affect the amount or value of the consideration for the
acquisition of any asset by the Company which is to be taken
into account in calculating any gain on subsequent disposal.
9.5 The Company has not made any claim under any of the
following:
(a) section 279 of TCGA (assets situated outside the
United Kingdom);
(b) sections 48 or 280 of TCGA (tax on chargeable gains
payable by instalments);
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(c) section 24 of TCGA (assets of negligible value).
9.6 The Company is not liable to be assessed to corporation tax
on chargeable gains or to capital transfer tax or inheritance
tax as donor or donee of any gift or transferor or transferee of
value.
9.7 In the period from the last Accounts Date to Completion,
there has not accrued any gain in respect of which the Company
may be liable to corporation tax on chargeable gains by virtue
of the provisions of section 13 of TCGA.
9.8 No consideration due to the Company after disposal has, so
far as the Warrantors are aware, become irrecoverable within the
meaning of section 48 of TCGA so as to entitle the Company to an
adjustment.
10. Close Companies
10.1 No distribution within section 418 of ICTA, so far as the
Warrantors are aware, has ever been made by the Company, and no
such distribution will be made prior to the Completion.
10.2 No loan or advance within sections 419 to 422 (inclusive)
of ICTA has ever been made by the Company.
11. Inheritance Tax
11.1 The Company has not made any transfers of value for the
purposes of section 94 of IHTA.
11.2 The Company has not been a party to associated operations
in relation to a transfer of value within the meaning of section
268 of IHTA.
11.3 No asset owned by, or shares or securities in, the Company
is liable to be subject to any sale, mortgage or charge by
virtue of section 212 of IHTA.
11.4 There is not outstanding any Inland Revenue charge (as
defined in section 237 of IHTA) over any asset of the Company or
in relation to any shares in the capital of the Company.
12. Tax Avoidance
12.1 The Company has not entered into or been party to any
transaction, scheme or arrangement designed wholly or partly for
the purpose of avoiding Taxation, which may result in a
liability to Taxation on the Company pursuant to any of the
following sections, namely sections 56, 56A, 116, 395 and 399;
sections 703-746 (inclusive); section 767A; section 770;
sections 774, 775 and 776, all ICTA;
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section 106 of TCGA; sections 29 and 30 of TCGA; sections 61, 75
and 142 of CAA.
12.2 The Company has not received any formal notification from
the Inland Revenue or its equivalent in other countries that it
has commenced a formal investigation in respect of any
transactions or arrangements involving the Company with a view
to applying section 770 of ICTA, or equivalent legislation in
other countries.
12.3 The Company has not entered as lessor into any leasing
transactions in respect of which capital allowances may be
restricted or disallowed under section 22 or 47 of CAA.
12.4 The Company has not without the prior consent of the
Treasury entered into any of the transactions specified in
sections 765 to 767 (inclusive) of ICTA.
13. Miscellaneous
13.1 The Company has not entered into any loan relationship
which is for an unallowable purpose as described in paragraph 13
of schedule 9 to the Finance ▇▇▇ ▇▇▇▇.
13.2 The Company has not entered into any loan relationships or
related transactions which are not at arm's length for the
purposes of paragraph 11 of schedule 9 to the Finance ▇▇▇ ▇▇▇▇.
13.3 The Company has not entered into any loan relationship with
a connected person such that section 87 of the Finance ▇▇▇ ▇▇▇▇
could apply to that relationship and the Company has complied
with all relevant provisions contained in Chapter II of Part IV
of the Finance ▇▇▇ ▇▇▇▇ in respect of any loan relationships to
which the Company is a party.
13.4 No loan relationship to which the Company is a party is a
convertible security for the purposes of section 92 of the
Finance ▇▇▇ ▇▇▇▇ or linked to the value of chargeable assets for
the purposes of section 93 of the Finance ▇▇▇ ▇▇▇▇.
13.5 The Company has made no claim in respect of bad debts for
the purposes of paragraph 5 of schedule 9 to the Finance ▇▇▇
▇▇▇▇.
13.6 The Company has not capitalised any debit in respect of a
loan relationship in its accounts other than in relation to a
fixed capital asset or project as referred to in paragraph 14 of
schedule 9 to the Finance ▇▇▇ ▇▇▇▇.
14. Value Added Tax
14.1 The Company:
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(a) is duly registered for the purposes of VAT and has
been so registered at all times when it has been legally
required to be registered by the relevant legislation;
(b) has complied in all material respects with all
statutory requirements, orders, provisions, directions
or conditions relating to VAT, including (for the
avoidance of doubt) the terms of any agreement reached
with HM Customs and Excise;
(c) maintains and has at all times maintained records
which are correct and up-to-date in all material
respects for the purposes of the legislation relating to
VAT and has preserved such records materially in such
form and for such periods as are required by such
legislation;
(d) is not in arrears with any payment or returns
required under any legislation relating to VAT, or
legally liable to any abnormal or non-routine payment,
or any forfeiture or penalty or fine or default
surcharge, or to the operation of any penal provision
relating to VAT or to pay any interest or fine as a
result of making late VAT returns; and
(e) has not been required by Customs and Excise to give
security.
14.2 The Company has not at any time been legally regarded as a
member of a group of companies for VAT purposes and no
application for it to be so treated has at any time been made.
14.3 So far as the Warrantors are aware, no act or transaction
has been effected in consequence whereof the Company is or may
be held legally liable for any VAT chargeable against any other
company; and the Company is not, and has not agreed to become an
agent, manager or factor for the purposes of section 47 of VATA
of any person who is not resident in the United Kingdom.
14.4 All supplies made by the Company are taxable supplies and
the Company is not and, so far as the Warrantors are aware, will
not be denied credit for any input tax by reason of the
operation of any provisions of VATA and the regulations made
thereunder; and all input tax for which the Company has claimed
credit has been or will be paid by the Company timeously in
respect of supplies made to it relating to goods or services
used or to be used for the purpose of the Company's business.
14.5 No supplies have been made to the Company to which the
provisions of section 8 to VATA might apply.
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14.6 No claims have been made by the Company since its inception
in respect of which a refund of VAT has been received by the
Company under section 36 of VATA.
14.7 The Company does not have an interest in any land in
relation to which an election has been made either by the
Company or by any other person to an exemption from VAT pursuant
to the provisions of schedule 10 of VATA.
14.8 The Company does not use in the course or furtherance of
its business any item to which Part XV of the VAT Regulations
1995 applies and in respect of which the period of adjustment
will not have expired on or before the Completion.
14.9 With regard to VAT, no transaction has been entered into by
the Company since the Accounts Date in respect of which the
Company is required to make a specific return or to provide
information to a relevant Taxation Authority and in respect of
which the time for making such return or providing such
information will expire on or after the Completion.
14.10 With regard to VAT, the returns submitted by the Company
are not the subject of any dispute with HM Customs & Excise or
other relevant or appropriate authority as of the Completion
Date and the Company is not involved in any material dispute
with HM Customs & Excise or other relevant or appropriate
authority concerning any matter likely to affect in any way the
liability (whether accrued, contingent or future) of the Company
to account for VAT and is under no liability to pay any penalty
or interest in connection with any claim for VAT.
15. Pension Schemes
The Company has not since the Accounts Date received any payment to
which section 601 of ICTA applies.
16. Share Schemes
16.1 The Company is not a participating company in any scheme
approved under section 185 or 186 of ICTA.
16.2 The Company has not established or contributed to a
qualifying employees share ownership trust as defined in
schedule 5 of the Finance ▇▇▇ ▇▇▇▇.
17. Capital Allowances
17.1 The Company has not since the Accounts Date done or omitted
to do, or agreed to do or permitted to be done, any act (other
than the sale of an asset at a price equal to its market value),
nor has the Company suffered any occurrence, as a result of
which any disposal value has been or may be required to be
brought into
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account under section 24 of CAA, nor has there been, nor may
there be, any recovery from the Company of excess relief within
section 42 or 47 of CAA.
17.2 Since the Accounts Date the Company has not done, nor has
it omitted to do, nor agreed to do, nor permitted to be done,
any act, nor, so far as the Warrantors are aware, has it
suffered any occurrence, as a result of which any balancing
charge has arisen or may arise under section 4 of CAA.
17.3 The Company has not made any election under section 37 of
CAA or engaged in any short-term leasing within section 40 of
CAA.
17.4 The Company has not taken or granted a lease of any assets
in respect of which an election has been made under section 53
or 55 of CAA.
18. Stamp Duty and Stamp Duty Reserve Tax
18.1 The Company has duly paid all stamp duty and all stamp duty
reserve tax for which it has at any time been legally liable,
and all documents which require to be stamped and which form
part of the Company's title to any asset or which the Company
may need to produce in court in evidence have been duly stamped.
18.2 Since inception, the Company has not made any claim for
relief or exemption under section 42 of the 1930 Act or sections
75 to 77 of the 1986 Act.
19. General
19.1 No act or transaction has been effected to which the
Company is a party in consequence whereof the Company has is or
may be held legally liable for any Taxation primarily chargeable
against some other person.
19.2 The Company does not operate any scheme approved under
section 202 of ICTA (payroll deduction scheme in respect of
donations to charity) or under sections 169 to 184 of ICTA
(profit related pay).
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SCHEDULE 5
CONDITIONS TO COMPLETION
1. The respective obligations under this agreement of each party hereto shall be
subject to the satisfaction on or prior to Completion of each of the following
conditions, any of which may be waived, in writing, by agreement of all the
parties:
(a) No temporary restraining order, preliminary or permanent injunction
or other order issued by any court of competent jurisdiction or other
legal or regulatory restraint or prohibition preventing the consummation
of the transactions contemplated hereby shall be in effect, nor shall
any proceeding brought by an administrative agency or commission or
other governmental authority or instrumentality, domestic or foreign,
seeking any of the foregoing be pending; nor shall there be any action
taken, or any statute, rule, regulation or order enacted, entered,
enforced or deemed applicable to the transactions contemplated hereby,
which makes the consummation of such transactions illegal.
(b) The Purchaser, the Company and the Vendors shall have timely
obtained from each Governmental Entity all approvals, waivers,
clearances and consents, if any, necessary for consummation of or in
connection with the transactions contemplated hereby, including, without
limitation, such approvals, waivers and consents as may be required from
the Biotechnology and Biological Sciences Research Council and Ministry
of Agricultural, Fisheries and Food, and under the Securities Act and
under any state securities laws.
(c) The relevant Vendors shall have received a letter dated prior to
Completion, from HM Inland Revenue, giving clearance for the
transactions contemplated by this agreement pursuant to Section 138 of
the TCGA and Section 707 of the ICTA.
(d) The boards of directors of the Purchaser and the Company shall have
approved the transactions contemplated herein.
(e) That 3i's payment of L 2,000,000 for D ordinary shares in the
Company is received by the Company's Solicitors and is in cleared funds.
(f) That the Purchaser receives confirmation from 3i and Roslin
Institute that there are no outstanding sums owed to each or any of them
by the Company.
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(g) That the sum of L 26,000 has been paid by the Company to 3i.
2. The obligations of the Vendors under this agreement shall be subject to the
satisfaction at or prior to Completion of each of the following conditions, any
of which may be waived, in writing, by the Warrantors' Representative and 3i:
(a) The Vendors shall have been provided with a certificate executed by
the secretary or assistant secretary of the Purchaser certifying:
(i) resolutions duly adopted by the board of directors of the
Purchaser authorising the execution of this agreement and the
execution, performance and delivery of all agreements, documents
and transactions contemplated hereby; and
(ii) the incumbency of the officers of the Purchaser executing
this agreement and all agreements and documents contemplated
hereby.
(b) The Company shall have received a certificate or certificates of the
Secretary of State of the State of Delaware and any applicable franchise
tax authority of such state, certifying as of a date no greater than
three business days prior Completion that Purchaser has filed all
required reports, paid all required fees and taxes and is, as of such
date, in good standing and authorised to transact business as a domestic
corporation.
3.
(a) The Purchaser shall have been provided with a certificate executed
by the Secretary of the Company certifying:
(i) resolutions duly adopted by the board of directors and where
relevant the Vendors of the Company authorising the execution of
this agreement and the execution, performance and delivery of
all agreements, documents and transactions contemplated hereby;
(ii) the memorandum and articles of association of the Company,
as in effect immediately prior to Completion, including all
amendments thereto; and
(iii) the incumbency of the officers of the Company executing
all agreements and documents contemplated hereby to be executed
by the Company.
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(b) The Company shall have taken or caused to be taken such action as
may be required under each outstanding option to enable the Purchaser to
acquire shares in the Company granted to employees or consultants of the
Company under any share option of the Company (each a "Company Option")
and to cause each holder of a Company Option to enter into an Option
Exchange Agreement.
(c) The Purchaser shall have received an opinion from its financial
advisor, ▇. ▇. ▇▇▇▇▇▇, stating that in the opinion of such financial
advisor, the terms of the transactions contemplated hereby are fair to
the stockholders of the Purchaser from a financial point of view.
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SCHEDULE 6
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
Except as disclosed in the Purchaser's Disclosure Letter, the Purchaser hereby
represents and warrants to the Vendors as follows:
(a) The Purchaser is a corporation duly organised, validly existing and
in good standing under the laws of its jurisdiction of organisation. The
Purchaser has the corporate power to own its properties and to carry on
its business as now being conducted and as proposed to be conducted and
is duly qualified to do business and is in good standing in each
jurisdiction in which the failure to be so qualified and in good
standing would have a Material Adverse Effect on the Purchaser. The
Purchaser does not have any subsidiaries or ownership interest in any
other person including, for the avoidance of doubt, any company or
corporation.
(b) The authorised, issued and outstanding capital stock of Purchaser is
as set forth on the Purchaser's Disclosure Letter. Other than as set
forth in the Purchaser's Disclosure Letter and as contemplated under
this Agreement, there are no other outstanding shares of capital stock
or voting securities of Purchaser, and there are no other options,
warrants, calls, rights, commitments or agreements of any character to
which Purchaser is a party or by which it is bound obligating the
Purchaser to issue, deliver, sell, repurchase or redeem, or cause to be
issued, delivered, sold, repurchased or redeemed, any shares of the
capital stock of the Purchaser or obligating the Purchaser to grant,
extend or enter into any such option, warrant, call right, commitment or
agreement. All of the issued and outstanding shares of capital stock of
the Purchaser are duly authorised, validly issued, fully paid,
non-assessable and free of pre-emptive rights or option. The
Consideration Shares when issued pursuant to this agreement will be duly
authorised, validly issued, fully paid, non-assessable and free of
pre-emptive rights or options.
(c)The Purchaser has all requisite legal and corporate power and
authority to enter into this agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this
agreement and the consummation of the transactions contemplated hereby
have been duly authorised by all necessary corporate action on the part
of the Purchaser. This agreement has been duly executed and delivered by
the Purchaser and constitutes the valid and binding obligation of the
Purchaser enforceable against the Purchaser in accordance with its
terms.
(d)
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(i) The execution and delivery of this agreement do 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 or acceleration of any
obligation or loss of a benefit under (i) any provision of the
Certificate of Incorporation or Bylaws of the Purchaser, as
amended, or (ii) any material mortgage, indenture, lease,
contract or other agreement or instrument, permit, concession,
franchise, license, judgement, order, decree, statute, law,
ordinance, rule or regulation applicable to the Purchaser or its
properties or assets.
(ii) No consent, approval, order or authorisation of, or
registration, declaration or filing with, any Governmental
Entity, is required by or with respect to the Purchaser in
connection with the execution and delivery of this agreement by
the Purchaser or the consummation by the Purchaser of the
transactions contemplated hereby, except for (i) the filing of a
Form 8-K with the Securities and Exchange Commission ("SEC") and
National Association of Securities Dealers ("NASD") within 15
days after Completion, (ii) any filings as may be required under
applicable state securities laws and the securities laws of any
foreign country, (iii) the filing with the Nasdaq National
Market of a Notification Form for Listing of Additional Shares
with respect to the Consideration Shares issuable pursuant to
this agreement and (iv) consents, authorisations, filings,
approvals and registrations which, if not obtained or made,
would not have a Material Adverse Effect on the Purchaser and
would not prevent, materially alter or delay any of the
transactions contemplated by this agreement.
(e)
(i) The Purchaser has filed all forms, reports and documents
required to be filed by the Purchaser with the SEC since July
30, 1996, and heretofore has made available to counsel for the
Vendors copies, in the form filed with the SEC, of (i) its
Annual Report on Form 10-K for the fiscal years ended December
31, 1996, 1997 and 1998, its Quarterly Reports on Form 10-Q for
the periods ended March 31, 1998, June 30, 1998 and September
30, 1998, (iii) all definitive proxy statements relating to
Purchaser's meetings of stockholders (whether annual or special)
held since July 30, 1996 and (iv) all other forms, reports and
registration statements (other than Quarterly Reports on Form
10-Q not referred to in clause (ii) above and excluding exhibits
to registration statements and materials relating to stock
option and compensation plans)
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filed with the SEC by the Purchaser since June 30, 1996 and
prior to the date hereof (collectively, the "Purchaser SEC
Documents"). As of their respective filing dates, the Purchaser
SEC Documents complied in all material respects with the
requirements of the Securities Exchange Act of 1934, as amended
(the "Exchange Act") and the Securities Act, and none of the
Purchaser SEC Documents contained any untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements made therein,
in light of the circumstances in which they were made, not
misleading, except to the extent corrected by a subsequent
Purchaser SEC Document filed prior to the date of this
agreement.
(ii) The financial statements of Purchaser, including the notes
thereto, included in the Purchaser SEC Documents (the "Purchaser
Financial Statements") were complete and correct in all material
respects as of their respective filing dates, complied as to
form in all material respects with applicable accounting
requirements and with the published rules and regulations of the
SEC with respect thereto as of their respective dates, and have
been prepared in accordance with generally accepted accounting
principles applied on a basis consistent throughout the periods
indicated and consistent with each other (except as may be
indicated in the notes thereto or, in the case of unaudited
statements, included in Quarterly Reports on Forms 10-Q). The
Purchaser Financial Statements fairly present the consolidated
financial condition and operating results of Purchaser and its
subsidiaries at the dates and during the periods indicated
therein (subject, in the case of unaudited statements, to
normal, recurring year-end adjustments). There has been no
change in Purchaser accounting policies except as described in
the notes to the Purchaser Financial Statements.
(f) Since December 31, 1998 (the "Purchaser Balance Sheet Date"), the
Purchaser has conducted its business in the ordinary course in a manner
consistent with past practice and there has not occurred: (i) any
change, event or condition (whether or not covered by insurance) that
has resulted in, or might reasonably be expected to result in, a
Material Adverse Effect to the Purchaser; (ii) any declaration, setting
aside, or payment of a dividend or other distribution with respect to
the shares of the Purchaser, or any direct or indirect redemption,
purchase or other acquisition by Purchaser of any of its shares of
capital stock; (iii) any material amendment or change to the Purchaser's
Certificate of Incorporation or Bylaws; or (iv) any negotiation or
agreement by the Purchaser to do any of the things described in the
preceding clauses (i) through (iii) (other than negotiations with the
Company, the Vendors and
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their representatives regarding the transactions contemplated by this
agreement).
(g) There is no private or governmental action, suit, proceeding, claim,
arbitration or investigation pending before any agency, court or
tribunal, foreign or domestic, or, to the knowledge of the Purchaser,
threatened against the Purchaser or any of its properties or any of its
officers or directors (in their capacities as such) that, individually
or in the aggregate, could reasonably be expected to have a Material
Adverse Effect on the Purchaser. There is no judgement, decree or order
against the Purchaser or, to the knowledge of the Purchaser, any of its
directors or officers (in their capacities as such) that could prevent,
enjoin, or materially alter or delay any of the transactions
contemplated by this agreement, or that could reasonably be expected to
have a Material Adverse Effect on the Purchaser.
(h) The Purchaser has obtained each federal, state, county, local or
foreign governmental consent, license, permit, grant, or other
authorisation of a Governmental Entity that is required for the
operation of the Purchaser's business ("Purchaser Authorisations"), and
all of such Purchaser Authorisations are in full force and effect,
except where the failure to obtain or have any of such Purchaser
Authorisations could not reasonably be expected to have a Material
Adverse Effect on the Purchaser.
(i) The Purchaser is purchasing the Sale Shares as principal and not as
a nominee or agent on behalf of any other person.
(j) The Purchaser acknowledges, without making any warranty or
representation to the Warrantors that, as at the date of this agreement
and except as set forth in the Warrantors' Disclosure Letter, there are
no facts, matters or circumstances known to the Purchaser which would
constitute a breach of the Warranties and accordingly is not entering
into this agreement with a view to making any claim under the Warranties
on the basis of the facts, matters and circumstances known to it.
(k) The facts set out in the specific disclosures set out in the
Purchaser's Disclosure Letter are true and accurate in all material
respects.
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SIGNED by SIMON BEST in the )
presence of: )
SIGNED by ▇▇▇▇ ▇▇▇▇▇ in the )
presence of: )
SIGNED by ▇▇▇ ▇▇▇▇ in the )
presence of: )
SIGNED by ▇▇▇ ▇▇▇▇▇ in the )
presence of: )
SIGNED by ▇▇▇ ▇▇▇▇▇▇ in the )
presence of: )
SIGNED by )
for and on behalf of GERON )
CORPORATION in the presence of: )
SIGNED by )
for and on behalf of ROSLIN )
INSTITUTE in the presence of: )
[Roslin to confirm method of signing]
SIGNED by )
for and on behalf of 3I GROUP PLC )
in the presence of: )
-83-
86
ANNEX A
Unregistered Trademarks
-84-