As filed with the Securities and Exchange Commission on January 19, 2001
Registration No. 333-51926
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 1. TO
THE SECURITIES ACT OF 1933
(Exact name of registrant as specified in its charter)
(State of Incorporation) (I.R.S. Employer Identification No.)
515 Galveston Drive
Redwood City, CA 94063
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
Senior Vice President & General Counsel
515 Galveston Drive
Redwood City, CA 94063
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Approximate date of commencement of proposed sale to the public:
As soon as practicable after the Registration Statement becomes effective.
If the only securities being registered on this form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [_]
If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box.[X]
If this form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE
Title of class of Amount to be registered (1) Proposed maximum Proposed maximum
securities to be registered offering aggregate Amount of
price per share (2) offering price (2) registration fee (3)
<S> <C> <C> <C> <C>
COMMON STOCK par value 209,500 shares $18.00 $3,771,000 $1,438
$0.0001 per share
(1) In addition, pursuant to Rule 416(a) under the Securities Act of 1933,
this registration statement shall also cover any additional shares of
Maxygen's common stock that become issuable by reason of any stock
dividend, stock split, recapitalization or other similar transaction
effected without Maxygen's receipt of consideration that results in an
increase in the number of Maxygen's outstanding shares of common stock.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) and (h)(1) of the Securities Act of 1933 based
upon the average of the high and low prices of Maxygen's common stock as
reported the Nasdaq National Market on January 16, 2001.
(3) Calculated based on an additional 10,000 shares to be registered at
$18.00 per share for a proposed maximum offering price of $180,000 and
an additional registration fee of $48. A filing fee in the amount of
$1,390 was previously paid.
The registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment that specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to Section 8(a), may
The information in this prospectus is not complete and may be changed. The
selling stockholders may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any state where the offer or sale is not
SUBJECT TO COMPLETION, DATED JANUARY 19, 2001
[LOGO OF MAXYGEN]
The Selling Stockholders: The selling stockholders identified in this
prospectus are selling 209,500 shares of our common
stock. We are not selling any shares of our common
stock under this prospectus and will not receive any
of the proceeds from the sale of shares by the
Offering Price: The selling stockholders may sell the shares of
common stock described in this prospectus in a number
of different ways and at varying prices. We provide
more information about how they may sell their shares
in the section titled "Plan of Distribution" on page
Trading Market: Our common stock is listed on the Nasdaq National
Market under the symbol "MAXY". On January 18, 2001,
the closing sale price of our common stock, as
reported on the Nasdaq National Market, was $19 3/8
Risks: Investing in our common stock involves a high degree
of risk. See "Risk Factors" beginning on page 5.
The shares offered or sold under this prospectus have not been approved by
the Securities and Exchange Commission or any state securities commission, nor
have these organizations determined that this prospectus is accurate or
complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is , 2001
The following is a summary of our business. You should read carefully this
prospectus, the section entitled "Risk Factors" in this prospectus, our Annual
Report on Form 10-K for the year ended December 31, 1999, our Quarterly Reports
on Forms 10-Q for the quarters ended March 31, 2000, June 30, 2000 and September
30, 2000, our Current Report on Form 8-K filed on August 15, 2000 as amended in
our Form 8-K/A on October 24, 2000 and the other documents incorporated by
reference into this prospectus for more information on our business and the
risks involved in investing in our stock.
We believe that we are the leader in the emerging field of directed
molecular evolution, the process by which genes are modified for specific
commercial uses. We are focused on creating novel products using our integrated
proprietary technologies for human therapeutics and industrial applications. Our
technologies bring together advances in molecular biology and protein
modification to capitalize on the large amount of genetic information generated
by government, academic and commercial laboratories to create novel
biotechnology products. Unlike conventional technologies, our technologies are
efficient, in part because they require minimal understanding of complex
underlying biological systems. We have designed our technologies to rapidly
develop new genes for commercial applications, where such genes would be
difficult or impossible to develop through other processes. Our principal
objective is to maximize the value of our technologies through the development
of multiple products in a broad range of industries including agriculture,
chemicals and human therapeutics.
We have established collaborations with recognized leaders in our target
industries and with U.S. government agencies. To date, our corporate
collaborators include Lundbeck in protein pharmaceuticals, Novozymes in the
area of industrial enzymes, DuPont and Syngenta in agriculture, DSM in
antibiotic manufacturing and Rio Tinto, Chevron, Pfizer and Hercules in chemical
bioprocessing. Our government grants are from the Defense Advanced Research
Projects Agency (DARPA) and the National Institute of Standards and Technology-
Advanced Research Program (NIST-ATP) primarily for the development of vaccines
and the advancement of our technologies.
We expect to continue to establish collaborations with leaders in our
target industries and with government agencies. We plan to retain significant
rights to develop and market products arising from our strategic collaborations.
In addition, we will identify and invest our own funds in certain specific areas
and product opportunities with the aim of capturing a high percentage of profits
on product sales.
We began operations in 1997 to commercialize technologies originally
conceived at Affymax Research Institute, a subsidiary of GlaxoSmithKline plc. We
were incorporated under the laws of Delaware on May 7, 1996. Our principal
executive offices are located at 515 Galveston Drive, Redwood City, CA 94063.
Our telephone number is (650) 298-5300 and our website is located at
www.maxygen.com. Information contained in our website is not a part of this
Acquisition of ProFound Pharma A/S
On August 10, 2000, we acquired ProFound Pharma A/S, a Danish biotechnology
company located in Copenhagen, Denmark. ProFound is focused on the development
of improved second-generation protein pharmaceutical products and has developed
broad preclinical development capabilities and proprietary technologies and
expertise that help to address traditional shortcomings of protein
pharmaceuticals such as half-life, stability and immunogenicity. The
transaction was accounted for as a purchase. We issued 1,102,578 shares of our
common stock and granted options to purchase an aggregate of 41,812 shares of
our common stock in connection with the acquisition of all the equity securities
of ProFound. Subsequent to the acquisition ProFound changed its name and form of
incorporation to Maxygen ApS.
This prospectus, and the documents incorporated by reference in this
prospectus, contain forward-looking statements that relate to future events or
our future financial performance. In some cases, you can identify forward-
looking statements by terminology, such as "may", "will", "should", "expect",
"plan", "anticipate", "believe", "estimate", "predict", "intend", "potential" or
"continue" or the negative of these terms or other comparable words. Examples
of these forward-looking statements include, but are not limited to, statements
regarding the following:
. our MolecularBreeding directed molecular evolution technologies and
. our ability to realize commercially valuable discoveries in our
. the attributes of any products we develop;
. our future financial performance;
. our intellectual property portfolio;
. our business strategies and plans; and
. our ability to develop products suitable for commercialization.
These statements are only predictions. Risks and uncertainties and the
occurrence of other events could cause actual results to differ materially from
these predictions. The risk factors set forth below at pages 5 to 16 should be
considered carefully in evaluating Maxygen and its business.
Although we believe that the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee future results, levels of
activity, performance or achievements. Moreover, neither we nor any other
person assumes responsibility for the accuracy and completeness of these
statements. We are under no duty to update any of the forward-looking
statements after the date of this prospectus or to conform these statements to
Maxygen/TM/, MaxyScan/TM/, MolecularBreeding/TM/, DNAShuffling/TM/, and the
Maxygen logo are some of our trademarks. Other service marks, trademarks and
trade names referred to in this prospectus, and in the documents incorporated by
reference in this prospectus, are the property of their respective owners.
You should carefully consider the risks described below, together with all
of the other information included in this prospectus, and the documents
incorporated by reference herein and filed with the SEC, in considering our
business and prospects. The risks and uncertainties described below and therein
are not the only ones facing Maxygen. Additional risks and uncertainties not
presently known to us or that we currently deem immaterial also may impair our
business operations. If any of the following risks actually occur, our business
could be harmed. In such case, the trading price of our common stock could
decline, and you may lose all of part of your investment.
We Have a History of Net Losses. We Expect to Continue to Incur Net Losses and
We May Not Achieve or Maintain Profitability.
We have incurred net losses since our inception, including a net loss of
approximately $11.3 million for the year ended December 31, 1999 and $46.7
million for the nine months ended September 30, 2000. As of September 30, 2000,
we had an accumulated deficit of approximately $70.9 million. We expect to have
increasing net losses and negative cash flow for at least the next several
years. The size of these net losses will depend, in part, on the rate of
growth, if any, in our contract revenues and on the level of our expenses. To
date, we have derived all our revenues from collaborations and grants and expect
to do so for at least the next several years. Revenues from collaborations and
grants are uncertain because our existing agreements have fixed terms and
because our ability to secure future agreements will depend upon our ability to
address the needs of our potential future collaborators. We expect to spend
significant amounts to fund research and development and enhance our core
technologies. As a result of our recently completed acquisition of ProFound, we
expect costs to increase further due to expanded operations, integration costs
associated with the acquisition and costs associated with operating in multiple
international locations. As a result, we expect that our operating expenses
will increase significantly in the near term and, consequently, we will need to
generate significant additional revenues to achieve profitability. Even if we
do achieve profitability, we may not be able to sustain or increase
profitability on a quarterly or annual basis.
Commercialization of Our Technologies Depends On Collaborations With Other
Companies. If We Are Not Able to Find Collaborators in the Future, We May Not
Be Able to Develop Our Technologies or Products.
Since we do not currently possess the resources necessary to develop and
commercialize potential products that may result from our technologies, or the
resources to complete any approval processes that may be required for these
products, we must enter into collaborative arrangements to develop and
commercialize products. We have entered into collaborative agreements with
other companies to fund the development of certain new products for specific
purposes. These contracts expire after a fixed period of time. If they are not
renewed or if we do not enter into new collaborative agreements, our revenues
will be reduced and our products may not be commercialized.
We have limited or no control over the resources that any collaborator may
devote to our products. Any of our present or future collaborators may not
perform their obligations as expected. These collaborators may breach or
terminate their agreement with us or otherwise fail to conduct their
collaborative activities successfully and in a timely manner. Further, our
collaborators may elect not to develop products arising out of our collaborative
arrangements or devote sufficient resources to the development, manufacture,
market or sale of these products. If any of these events occur, we may not be
able to develop our technologies or commercialize our products.
We Are an Early Stage Company Deploying Unproven Technologies. If We Do Not
Develop Commercially Successful Products, We May Be Forced to Cease Operations.
You must evaluate us in light of the uncertainties and complexities
affecting an early stage biotechnology company. Our proprietary technologies
are new and in the early stage of development. We may not develop products that
prove to be safe and efficacious, meet applicable regulatory standards, are
capable of being manufactured at reasonable costs, or can be marketed
We may not be successful in the commercial development of products.
Successful products will require significant development and investment,
including testing, to demonstrate their cost-effectiveness prior to their
commercialization. To date, companies in the biotechnology industry have
developed and commercialized only a limited number of products. We have not
proven our ability to develop and commercialize products. Further, none of our
potential vaccine or protein therapeutic products are expected to enter clinical
trials within the next year. We must conduct a substantial amount of additional
research and development before any regulatory authority will approve any of our
products. Our research and development may not indicate that our products are
safe and effective, in which case regulatory authorities may not approve them.
Problems frequently encountered in connection with the development and
utilization of new and unproven technologies and the competitive environment in
which we operate might limit our ability to develop commercially successful
We Intend to Conduct Proprietary Research Programs, and Any Conflicts With Our
Collaborators or Any Inability to Commercialize Products Resulting from This
Research Could Harm Our Business.
An important part of our strategy involves conducting proprietary research
programs. We may pursue opportunities in fields that could conflict with those
of our collaborators. Moreover, disagreements with our collaborators could
develop over rights to our intellectual property. Any conflict with our
collaborators could reduce our ability to obtain future collaboration agreements
and negatively impact our relationship with existing collaborators, which could
reduce our revenues.
Certain of our collaborators could also become competitors in the future.
Our collaborators could develop competing products, preclude us from entering
into collaborations with their competitors, fail to obtain timely regulatory
approvals, terminate their agreements with us prematurely or fail to devote
sufficient resources to the development and commercialization of products. Any
of these developments could harm our product development efforts.
We will either commercialize products resulting from our proprietary
programs directly or through licensing to other companies. We have no
experience in manufacturing and marketing, and we currently do not have the
resources or capability to manufacture products on a commercial scale. In order
for us to commercialize these products directly, we would need to develop, or
obtain through outsourcing arrangements, the capability to manufacture, market
and sell products. We do not have these capabilities, and we may not be able to
develop or otherwise obtain the requisite manufacturing, marketing and sales
capabilities. If we are unable to successfully commercialize products resulting
from our proprietary research efforts, we will continue to incur losses.
We May Encounter Difficulties in Managing Our Growth. These Difficulties Could
Increase Our Losses.
We have experienced rapid and substantial growth that has placed and, if
this growth continues as expected, will place a strain on our human and capital
resources. If we are unable to manage this growth effectively, our losses could
increase. The number of our employees increased from 74 at
December 31, 1998 to 143 at December 31, 1999 to 236 at September 30, 2000. Our
revenues increased from $2.7 million in 1998 to $14.0 million in 1999 and were
$17.5 million for the nine months ended September 30, 2000. Our ability to
manage our operations and growth effectively requires us to continue to expend
funds to enhance our operational, financial and management controls, reporting
systems and procedures and to attract and retain sufficient numbers of talented
employees. If we are unable to implement improvements to our management
information and control systems in an efficient or timely manner, or if we
encounter deficiencies in existing systems and controls, then management may
have access to inadequate information to manage our day-to-day operations.
Failure to attract and retain sufficient numbers of talented employees will
further strain our human resources and could impede our growth and ability to
satisfy our obligations under collaboration agreements. This would reduce our
revenue, increase our losses and harm our reputation in the marketplace.
The Operation of International Locations May Raise Operating Expenses and Divert
We are expanding internationally. We recently acquired ProFound, a Danish
biotechnology company, and are now operating with international business
locations. Expansion into an international operational entity will require
additional management attention and resources. We have limited experience in
localizing our operations and in conforming our operations to local cultures,
standards and policies. We may have to compete with local companies who
understand the local situation better than we do. We may not be successful in
expanding into international locations or in generating revenues from foreign
operations. Even if we are successful, the costs of operating internationally
are expected to exceed our international revenues for at least the next several
years. As we continue to expand internationally, we are subject to risks of
doing business internationally, including the following:
. regulatory requirements that may limit or prevent the offering of our
products in local jurisdictions;
. government limitations on research and/or research including
genetically engineered products or processes;
. difficulties in staffing and managing foreign operations;
. longer payment cycles, different accounting practices and problems in
collecting accounts receivable;
. cultural nonacceptance of genetic manipulation and genetic
. potentially adverse tax consequences.
Some of these factors may cause our international costs to exceed our domestic
costs of doing business. To the extent we expand our international operations
and have additional portions of our international revenues denominated in
foreign currencies, we also could become subject to increased difficulties in
collecting accounts receivable and will become subject to increased risks
relating to foreign currency exchange rate fluctuations.
Acquisitions Could Result in Dilution, Operating Difficulties and Other Harmful
If appropriate opportunities present themselves, we intend to acquire
businesses and technologies that complement our capabilities. As set forth
above, on August 10, 2000 we acquired ProFound, a Danish biotechnology company.
The process of integrating any acquisition may create
unforeseen operating difficulties and expenditures and is itself risky. The
areas where we may face difficulties include:
. diversion of management time (both ours and that of the acquired
company) from focus on operating the businesses to issues of
integration and future products during the period of negotiation
through closing and further diversion of such time after closing;
. decline in employee morale and retention issues resulting from changes
in compensation, reporting relationships, future prospects, or the
direction of the business;
. the need to integrate each company's accounting, management
information, human resource and other administrative systems to permit
effective management and the lack of control if such integration is
delayed or not implemented; and
. the need to implement controls, procedures and policies appropriate
for a larger public company in companies that prior to acquisition had
been smaller, private companies.
We have almost no experience in managing this integration process. Moreover,
the anticipated benefits of any or all of these acquisitions may not be
Future acquisitions could result in potentially dilutive issuances of
equity securities, the incurrence of debt, contingent liabilities or
amortization expenses related to goodwill and other intangible assets, any of
which could harm our business. Future acquisitions may require us to obtain
additional equity or debt financing, which may not be available on favorable
terms or at all. Even if available, this financing may be dilutive.
Since Our Technologies Can Be Applied to Many Different Industries, If We Focus
Our Efforts on Industries That Fail to Produce Viable Product Candidates, We May
Fail to Capitalize on More Profitable Areas.
We have limited financial and managerial resources. In light of the fact
that our technologies may be applicable to numerous, diverse industries, we will
be required to prioritize our application of resources to discrete efforts.
This requires us to focus on product candidates in selected industries and
forego efforts with regard to other products and industries. Our decisions may
not produce viable commercial products and may divert our resources from more
profitable market opportunities.
Public Perception of Ethical and Social Issues May Limit the Use of Our
Technologies, Which Could Reduce Our Revenues.
Our success will depend in part upon our ability to develop products
discovered through our MolecularBreeding or other technologies. Governmental
authorities could, for social or other purposes, limit the use of genetic
processes or prohibit the practice of our MolecularBreeding or other
technologies. Ethical and other concerns about our MolecularBreeding or other
technologies, particularly the use of genes from nature for commercial purposes,
and products resulting therefrom could adversely affect their market acceptance.
If the Public Does Not Accept Genetically Engineered Products, We Will Have Less
Demand for Our Products.
The commercial success of our potential products will depend in part on
public acceptance of the use of genetically engineered products including drugs,
plants and plant products. Claims that genetically
engineered products are unsafe for consumption or pose a danger to the
environment may influence public attitudes. Our genetically engineered products
may not gain public acceptance. Negative public reaction to genetically modified
organisms and products could result in greater government regulation of genetic
research and resultant products, including stricter labeling laws or
regulations, and could cause a decrease in the demand for our products.
The subject of genetically modified organisms has received negative
publicity in Europe, where ProFound is based, which has aroused public debate.
The adverse publicity in Europe could lead to greater regulation and trade
restrictions on imports of genetically altered products. If similar adverse
public reaction occurs in the United States, genetic research and resultant
agricultural and other products could be subject to greater domestic regulation
and could cause a decrease in the demand for our products.
Many Potential Competitors Who Have Greater Resources and Experience Than We Do
May Develop Products and Technologies That Make Ours Obsolete.
The biotechnology industry is characterized by rapid technological change,
and the area of gene research is a rapidly evolving field. Our future success
will depend on our ability to maintain a competitive position with respect to
technological advances. Rapid technological development by others may result in
our products and technologies becoming obsolete.
We face, and will continue to face, intense competition from organizations
such as large and small biotechnology companies, as well as academic and
research institutions and government agencies that are pursuing competing
technologies for modifying DNA and proteins. These organizations may develop
technologies that are alternatives to our technologies. Further, our
competitors in the directed molecular evolution field may be more effective at
implementing their technologies to develop commercial products. Some of these
competitors have entered into collaborations with leading companies within our
target markets to produce enzymes for commercial purposes.
Any products that we develop through our proprietary technologies will
compete in multiple, highly competitive markets. Most of the organizations
competing with us in the markets for such products have greater capital
resources, research and development and marketing staffs and facilities and
capabilities, and greater experience in modifying DNA and proteins, obtaining
regulatory approvals, manufacturing products and marketing.
Accordingly, our competitors may be able to develop technologies and
products more easily, which would render our technologies and products and those
of our collaborators obsolete and noncompetitive.
Any Inability to Adequately Protect Our Proprietary Technologies Could Harm Our
Our success will depend in part on our ability to obtain patents and
maintain adequate protection of our other intellectual property for our
technologies and products in the U.S. and other countries. If we do not
adequately protect our intellectual property, competitors may be able to
practice our technologies and erode our competitive advantage. The laws of some
foreign countries do not protect proprietary rights to the same extent as the
laws of the U.S., and many companies have encountered significant problems in
protecting their proprietary rights in these foreign countries. These problems
can be caused by, for example, a lack of rules and processes for defending
intellectual property rights.
The patent positions of biopharmaceutical and biotechnology companies,
including our patent position, are generally uncertain and involve complex legal
and factual questions. We will be able to protect our proprietary rights from
unauthorized use by third parties only to the extent that our proprietary
technologies are covered by valid and enforceable patents or are effectively
maintained as trade secrets. We will apply for patents covering both our
technologies and products as we deem appropriate. However, these applications
may be challenged and may not result in issued patents. Our existing patents
and any future patents we obtain may not be sufficiently broad to prevent others
from practicing our technologies or from developing competing products.
Furthermore, others may independently develop similar or alternative
technologies or design around our patented technologies. In addition, others
may challenge or invalidate our patents or our patents may fail to provide us
with any competitive advantages.
We rely upon trade secret protection for our confidential and proprietary
information. We have taken security measures to protect our proprietary
information. These measures may not provide adequate protection for our trade
secrets or other proprietary information. We seek to protect our proprietary
information by entering into confidentiality agreements with employees,
collaborators and consultants. Nevertheless, employees, collaborators or
consultants may still disclose our proprietary information, and we may not be
able to meaningfully protect our trade secrets. In addition, others may
independently develop substantially equivalent proprietary information or
techniques or otherwise gain access to our trade secrets.
Litigation or Other Proceedings or Third Party Claims of Intellectual Property
Infringement Could Require Us to Spend Time and Money and Could Shut Down Some
of Our Operations.
Our commercial success depends in part on neither infringing patents and
proprietary rights of third parties, nor breaching any licenses that we have
entered into with regard to our technologies and products. Others have filed,
and in the future are likely to file, patent applications covering genes or gene
fragments that we may wish to utilize with our proprietary technologies, or
products that are similar to products developed with the use of our
MolecularBreeding and other technologies or alternative methods of generating
gene diversity. If these patent applications result in issued patents and we
wish to use the claimed technology, we would need to obtain a license from the
Third parties may assert that we are employing their proprietary technology
without authorization. In addition, third parties may obtain patents in the
future and claim that use of our technologies infringes these patents. We could
incur substantial costs and diversion of management and technical personnel in
defending ourselves against any of these claims or enforcing our patents or
other intellectual property rights against others. Furthermore, parties making
claims against us may be able to obtain injunctive or other equitable relief
that could effectively block our ability to further develop, commercialize and
sell products, and such claims could result in the award of substantial damages
against us. In the event of a successful claim of infringement against us, we
may be required to pay damages and obtain one or more licenses from third
parties. We may not be able to obtain these licenses at a reasonable cost, if
at all. In that event, we could encounter delays in product introductions while
we attempt to develop alternative methods or products or be required to cease
commercializing effected products.
We routinely monitor the public disclosures of other companies operating in
our industry regarding their technological development efforts. If we determine
that these efforts violate our intellectual property or other rights, we intend
to take appropriate action, which could include litigation. Any action we take
could result in substantial costs and diversion of management and technical
personnel. Furthermore, the outcome of any action we take to protect our rights
may not be resolved in our favor.
On April 27, 2000, we announced that we had initiated an arbitration
proceeding against Echira Biotechnology (then known as Energy BioSystems
Corporation) in connection with Echira's claim that it has developed a "new gene
shuffling" technology. We allege that Echira has breached the confidentiality
provisions and certain other terms of the Development and License Agreement
entered into by Echira and Maxygen in 1997, pursuant to which we disclosed
confidential information regarding our MolecularBreeding technologies to Echira.
An arbitration hearing was held in November, 2000 and we expect a decision from
the arbitrator in the first quarter of 2001.
If We Lose Our Key Personnel or Are Unable to Attract and Retain Additional
Personnel We May Be Unable to Pursue Collaborations or Develop Our Own Products.
We are highly dependent on the principal members of our management and
scientific staff, the loss of whose services might adversely impact the
achievement of our objectives. In addition, recruiting and retaining qualified
scientific personnel to perform future research and development work will be
critical to our success. We do not currently have sufficient executive
management personnel to execute fully our business plan. There is currently a
shortage of skilled executives, which is likely to continue. As a result,
competition for skilled personnel is intense, and the turnover rate can be high.
Although we believe we will be successful in attracting and retaining qualified
personnel, competition for experienced scientists from numerous companies and
academic and other research institutions may limit our ability to do so on
acceptable terms. Failure to attract and retain personnel could prevent us from
pursuing collaborations or developing our products or core technologies.
Our planned activities will require additional expertise in specific
industries and areas applicable to the products developed through our
technologies. These activities will require the addition of new personnel,
including management, and the development of additional expertise by existing
management personnel. The inability to acquire these services or to develop
this expertise could impair the growth, if any, of our business.
We Will Need Additional Capital in the Future. If Additional Capital is Not
Available, We Will Have to Curtail or Cease Operations.
Our future capital requirements will be substantial and will depend on many
factors including payments received under collaborative agreements and
government grants, the progress and scope of our collaborative and independent
research and development projects, the effect of any acquisitions, and the
filing, prosecution and enforcement of patent claims.
Changes may also occur that would consume available capital resources
significantly sooner than we expect. We may be unable to raise sufficient
additional capital. If we fail to raise sufficient funds, we will have to
curtail or cease operations. We anticipate that the net proceeds from our
public offerings and interest earned thereon, together with existing cash and
cash equivalents and anticipated cash flows from operations, will enable us to
maintain our currently planned operations for at least the next 12 months. If
our capital resources are insufficient to meet future capital requirements, we
will have to raise additional funds to continue the development of our
technologies and complete the commercialization of products, if any, resulting
from our technologies.
Some of Our Programs Depend on Government Grants, Which May Be Withdrawn. The
Government Has License Rights to Technology Developed With Its Funds.
We have received and expect to continue to receive significant funds under
various U.S. government research and technology development programs. The
government may significantly reduce funding in the future for a number of
reasons. For example, some programs are subject to a yearly
appropriations process in Congress. Additionally, we may not receive funds under
existing or future grants because of budgeting constraints of the agency
administering the program. There can be no assurance that we will receive the
entire funding under our existing or future grants.
Our grants provide the U.S. government a non-exclusive, non-transferable,
paid-up license to practice for or on behalf of the U.S. inventions made with
federal funds. If the government exercises these rights, the U.S. government
could use these inventions and our potential market could be reduced.
Our Potential Therapeutic Products Are Subject to a Lengthy and Uncertain
Regulatory Process. If Our Potential Products Are Not Approved, We Will Not Be
Able to Commercialize Those Products.
The U.S. Food and Drug Administration must approve any vaccine or
therapeutic product before it can be marketed in the U.S. Before we can file a
new drug application or biologic license application with the FDA, the product
candidate must undergo extensive testing, including animal and human clinical
trials, which can take many years and require substantial expenditures. Data
obtained from such testing are susceptible to varying interpretations that could
delay, limit or prevent regulatory approval. In addition, changes in regulatory
policy for product approval during the period of product development and
regulatory agency review of each submitted new application or product license
application may cause delays or rejections. The regulatory process is expensive
and time consuming. The regulatory agencies of foreign governments must also
approve our therapeutic products before the products can be sold in those other
Because our products involve the application of new technologies and may be
based upon new therapeutic approaches they may be subject to substantial review
by government regulatory authorities and government regulatory authorities may
grant regulatory approvals more slowly for our products than for products using
more conventional technologies. We have not submitted an application to the FDA
or any other regulatory authority for any product candidate, and neither the FDA
nor any other regulatory authority has approved any therapeutic product
candidate developed with our MolecularBreeding technologies for
commercialization in the U.S. or elsewhere. We or any of our collaborators may
not be able to conduct clinical testing or obtain the necessary approvals from
the FDA or other regulatory authorities for our products.
Even after investing significant time and expenditures we may not obtain
regulatory approval for our products. Even if we receive regulatory approval,
this approval may entail limitations on the indicated uses for which we can
market a product. Further, once regulatory approval is obtained, a marketed
product and its manufacturer are subject to continual review, and discovery of
previously unknown problems with a product or manufacturer may result in
restrictions on the product, manufacturer and manufacturing facility, including
withdrawal of the product from the market. In certain countries, regulatory
agencies also set or approve prices.
Laws May Limit Our Provision of Genetically Engineered Agricultural Products in
the Future. These Laws Could Reduce Our Ability to Sell These Products.
Maxygen and/or its collaborators may develop genetically engineered
agricultural products. The field testing, production and marketing of
genetically engineered plants and plant products are subject to federal, state,
local and foreign governmental regulation. Regulatory agencies administering
existing or future regulations or legislation may not allow us to produce and
market our genetically engineered products in a timely manner or under
technically or commercially feasible conditions. In addition, regulatory action
or private litigation could result in expenses, delays or other impediments to
our product development programs or the commercialization of resulting products.
The FDA currently applies the same regulatory standards to foods developed
through genetic engineering as applied to foods developed through traditional
plant breeding. However, genetically engineered food products will be subject to
premarket review if these products raise safety questions or are deemed to be
food additives. Our products may be subject to lengthy FDA reviews and
unfavorable FDA determinations if they raise questions, are deemed to be food
additives, or if the FDA changes its policy.
The FDA has also announced in a policy statement that it will not require
that genetically engineered agricultural products be labeled as such, provided
that these products are as safe and have the same nutritional characteristics as
conventionally developed products. The FDA may reconsider or change its
labeling policies, or local or state authorities may enact labeling
requirements. Any such labeling requirements could reduce the demand for our
The U.S. Department of Agriculture prohibits genetically engineered plants
from being grown and transported except pursuant to an exemption, or under
strict controls. If our future products are not exempted by the USDA, it may be
impossible to sell such products.
Adverse Events in the Field of Gene Therapy May Negatively Impact Regulatory
Approval or Public Perception of Any Gene Therapy Products We or Our
Collaborators May Develop.
Currently, we are not engaged in developing gene therapy products; however,
we may engage in these activities in the future either for our own account or
with collaborators. If we or our collaborators develop gene therapy products,
these products may encounter substantial delays in development and approval due
to the government regulation and approval process. Adverse events reported in
gene therapy clinical trials may lead to more government scrutiny of proposed
clinical trials of gene therapy products, stricter labeling requirements for
these products and delays in the approval of gene therapy products for
The commercial success of any potential gene therapy products made by us or
our collaborators will depend in part on public acceptance of the use of gene
therapies for the prevention or treatment of human diseases. Public attitudes
may be influenced by claims that gene therapies are unsafe, and gene therapy
products may not gain the acceptance of the public or the medical community.
Negative public reaction to gene therapy could result in a decrease in demand
for any gene therapy products we or our collaborators may develop.
Health Care Reform and Restrictions on Reimbursements May Limit Our Returns on
Our future products are expected to include pharmaceutical products. Our
ability and that of our collaborators to commercialize pharmaceutical products
developed with our technologies may depend in part on the extent to which
reimbursement for the cost of these products will be available from government
health administration authorities, private health insurers and other
organizations. Third-party payors are increasingly challenging the price of
medical products and services. Government health care reform and restrictions
on reimbursements have also recently been discussed by various U.S. governmental
authorities. Significant uncertainty exists as to the reimbursement status of
newly approved health care products, and there can be no assurance that adequate
third party coverage will be available for any product to enable us to maintain
price levels sufficient to realize an appropriate return on our investment in
research and product development.
Our Collaborations With Outside Scientists May Be Subject to Change, Which Could
Limit Our Access to Their Expertise.
We work with scientific advisors and collaborators at academic and other
institutions. These scientists are not our employees and may have other
commitments that would limit their availability to us. Although our scientific
advisors generally agree not to do competing work, if a conflict of interest
between their work for us and their work for another entity arises, we may lose
their services. Although our scientific advisors and collaborators sign
agreements not to disclose our confidential information, it is possible that
certain of our valuable proprietary knowledge may become publicly known through
We May Be Sued for Product Liability.
We may be held liable if any product we develop, or any product that is
made with the use or incorporation of, any of our technologies, causes injury or
is found otherwise unsuitable during product testing, manufacturing, marketing
or sale. These risks are inherent in the development of chemical, agricultural
and pharmaceutical products. Although we intend to obtain product liability
insurance, this insurance may be prohibitively expensive, or may not fully cover
our potential liabilities. Inability to obtain sufficient insurance coverage at
an acceptable cost or otherwise to protect against potential product liability
claims could prevent or inhibit the commercialization of products developed by
us or our collaborators. If we are sued for any injury caused by our products,
our liability could exceed our total assets.
We Use Hazardous Chemicals and Radioactive and Biological Materials in Our
Business. Any Claims Relating to Improper Handling, Storage or Disposal of
These Materials Could Be Time Consuming and Costly.
Our research and development processes involve the controlled use of
hazardous materials, including chemicals, radioactive and biological materials.
Some of these materials may be novel, including viruses with novel properties
and animal models for the study of viruses. Our operations also produce
hazardous waste products. Some of our work also involves the development of
novel viruses and viral animal models. We cannot eliminate the risk of
accidental contamination or discharge and any resultant injury from these
materials. Federal, state and local laws and regulations govern the use,
manufacture, storage, handling and disposal of these materials. We believe that
our current operations comply in all material respects with these laws and
regulations. We could be subject to civil damages in the event of an improper
or unauthorized release of, or exposure of individuals to, hazardous materials.
In addition, claimants may sue us for injury or contamination that results from
our use or the use by third parties of these materials, and our liability may
exceed our total assets. Compliance with environmental laws and regulations may
be expensive, and current or future environmental regulations may impair our
research, development, or production efforts. We believe that our current
operations comply in all material respects with applicable Environmental
Protection Agency regulations.
In addition, certain of our collaborators are working with these types of
hazardous materials in connection with our collaborations. To our knowledge,
the work is performed in accordance with biosafety regulations. In the event of
a lawsuit or investigation, we could be held responsible for any injury caused
to persons or property by exposure to, or release of, these viruses and
hazardous materials. Further, under certain circumstances, we have agreed to
indemnify our collaborators against all damages and other liabilities arising
out of development activities or products produced in connection with these
Our Stock Price Has Been, and May Continue to Be, Extremely Volatile.
The trading prices of life science company stocks in general, and ours in
particular, have experienced extreme price fluctuations in recent months. The
valuations of many life science companies without consistent product revenues
and earnings, including ours, are extraordinarily high based on conventional
valuation standards such as price to earnings and price to sales ratios. These
trading prices and valuations may not be sustained. Any negative change in the
public's perception of the prospects of biotechnology or life science companies
could depress our stock price regardless of our results of operations. Other
broad market and industry factors may decrease the trading price of our common
stock, regardless of our performance. Market fluctuations, as well as general
political and economic conditions such as recession or interest rate or currency
rate fluctuations, also may decrease the trading price of our common stock. In
addition, our stock price could be subject to wide fluctuations in response to
factors including the following:
. announcements of new technological innovations or new products by us
or our competitors;
. changes in financial estimates by securities analysts;
. conditions or trends in the biotechnology and life science industries;
. changes in the market valuations of other biotechnology or life
. developments in domestic and international governmental policy or
. announcements by us or our competitors of significant acquisitions,
strategic partnerships, joint ventures or capital commitments;
. developments in patent or other proprietary rights;
. period-to-period fluctuations in our operating results;
. future royalties from product sales, if any, by our strategic
. sales of our common stock or other securities in the
In the past, stockholders have often instituted securities class action
litigation after periods of volatility in the market price of a company's
securities. If a stockholder files a securities class action suit against us,
we would incur substantial legal fees and our management's attention and
resources would be diverted from operating our business in order to respond to
We Expect that Our Quarterly Results of Operations Will Fluctuate, and This
Fluctuation Could Cause Our Stock Price to Decline.
Our quarterly operating results have fluctuated in the past and are likely
to do so in the future. These fluctuations could cause our stock price to
fluctuate significantly or decline. Some of the factors that could cause our
operating results to fluctuate include:
. expiration of research contracts with collaborators or government
research grants, which may not be renewed or replaced;
. the success rate of our discovery efforts leading to milestones and
. the timing and willingness of collaborators to commercialize our
products, which would result in royalties; and
. general and industry specific economic conditions, which may affect
our collaborators' research and development expenditures.
A large portion of our expenses are relatively fixed, including expenses
for facilities, equipment and personnel. Accordingly, if revenues decline or do
not grow as anticipated due to expiration of research contracts or government
research grants, failure to obtain new contracts or other factors, we may not be
able to correspondingly reduce our operating expenses. In addition, we plan to
significantly increase operating expenses in 2001. Failure to achieve
anticipated levels of revenues could therefore significantly harm our operating
results for a particular fiscal period.
Due to the possibility of fluctuations in our revenues and expenses, we
believe that quarter-to-quarter comparisons of our operating results are not a
good indication of our future performance. Our operating results in some
quarters may not meet the expectations of stock market analysts and investors.
In that case, our stock price would likely decline.
Some of Our Existing Stockholders Can Exert Control Over Us, and May Not Make
Decisions that Are in the Best Interests of All Stockholders.
Our executive officers, directors and principal stockholders (greater than
5% stockholders) together control approximately 34% of our outstanding common
stock, including GlaxoSmithKline plc which owns approximately 19% of our
outstanding common stock. As a result, these stockholders, if they act together,
and GlaxoSmithKline plc by itself, are able to exert a significant degree of
influence over our management and affairs and over matters requiring stockholder
approval, including the election of directors and approval of significant
corporate transactions. In addition, this concentration of ownership may delay
or prevent a change in control of Maxygen and might affect the market price of
our common stock, even when a change may be in the best interests of all
stockholders. In addition, the interests of this concentration of ownership may
not always coincide with our interests or the interests of other stockholders
and accordingly, they could cause us to enter into transactions or agreements
that we would not otherwise consider.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of the shares of
common stock offered by the selling stockholders. See "Selling Stockholders".
We have never declared or paid any dividends on our capital stock. We
intend to retain any future earnings to support operations and to finance the
growth and development of our business, and we do not anticipate paying cash
dividends for the foreseeable future.
WHERE YOU CAN GET MORE INFORMATION
We are a reporting company and file annual, quarterly and current reports,
proxy statements and other information with the SEC. You may read and copy
these reports, proxy statements and other information at the SEC's public
reference rooms at Room 1024, 450 Fifth Street, N.W., Washington, D.C., as well
as at the SEC's regional offices at 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661 and 7 World Trade Center, Suite 1300, New York, NY
10048. You can request copies of these documents by writing to the SEC and
paying a fee for the copying cost. Please call the SEC at 1-800-SEC-0330 for
more information about the operation of the public reference rooms. Our SEC
filings are also available at the SEC's web site at "http://www.sec.gov". In
addition, you can read and copy our SEC filings at the office of the National
Association of Securities Dealers, Inc. at 1735 "K" Street, Washington, D.C.
The SEC allows us to "incorporate by reference" information that we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
an important part of this prospectus, and information that we file later with
the SEC will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filings we
will make with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934:
. Annual Report on Form 10-K for the year ended December 31, 1999, filed
March 28, 2000;
. Definitive Proxy Statement on Schedule 14A, filed April 20, 2000;
. Quarterly Report on Form 10-Q for the quarter ended March 31, 2000,
filed May 15, 2000;
. Quarterly Report on Form 10-Q for the quarter ended June 30, 2000,
filed August 14, 2000;
. Quarterly Report on Form 10-Q for the quarter ended September 30,
2000, filed November 14, 2000;
. Current Report on Form 8-K, filed August 15, 2000, as amended by the
Current Report on Form 8-K/A filed October 24, 2000; and
. The description of our common stock contained in our registration
statement on Form 8-A, as filed on December 7, 1999 with the SEC.
You may request a copy of these filings at no cost, by writing or
telephoning us at the following address:
515 Galveston Drive
Redwood City, CA 94063
This prospectus is part of a registration statement we filed with the SEC.
You should rely only on the information incorporated by reference or provided in
this prospectus and the registration statement. We have authorized no one to
provide you with different information. You should not assume that the
information in this prospectus is accurate as of any date other than the date on
the front of the document.
In connection with our acquisition of Maxygen ApS (then known as ProFound
Pharma A/S) on August 10, 2000, we issued shares of our common stock to the
first nine selling stockholders identified in the table below, and we agreed to
register a number of their shares for resale. We also agreed to use reasonable
efforts to keep the registration statement effective until the earliest of:
(i) the date such shares have been sold to the public;
(ii) August 9, 2001; and
(iii) the date when all such shares may be sold in any three month period
under Rule 144 under the Securities Act of 1933.
This prospectus also covers sales of shares of our common stock by certain other
stockholders. Our registration of the shares of common stock does not
necessarily mean that the selling stockholders will sell all or any of the
The following table sets forth certain information regarding the beneficial
ownership of the common stock, as of January 18, 2001, of each of the selling
The information provided in the table below with respect to each selling
stockholder has been obtained from that selling stockholder. Except as
otherwise disclosed below, none of the selling stockholders has, or within the
past three years has had, any position, office or other material relationship
with us. Because the selling stockholders may sell all or only a portion of the
shares of common stock beneficially owned by them, we cannot estimate the number
of shares of common stock that will be beneficially owned by the selling
stockholders after this offering. In addition, the selling stockholders may have
sold, transferred or otherwise disposed of, or may sell, transfer or otherwise
dispose of, at any time or from time to time since the date on which they
provided the information regarding the shares of common stock beneficially owned
by them, all or a portion of the shares of common stock beneficially owned by
them in transactions exempt from the registration requirements of the Securities
Act of 1933.
Beneficial ownership is determined in accordance with Rule 13d-3(d)
promulgated by the SEC under the Securities Exchange Act of 1934. Unless
otherwise noted, each person or group identified possesses sole voting and
investment power with respect to shares, subject to community property laws
where applicable. None of the share amounts set forth below represents more than
1% of our outstanding stock as of January 18, 2001, adjusted as required by
rules promulgated by the SEC.
Number of Shares Shares Being
Selling Stockholder Beneficially Owned Offered
------------------- ------------------ -------
<S> <C> <C>
Jan Moller Mikkelsen (1)....................... 154,756 56,362
Christian Karsten Hansen (2)................... 116,067 42,272
Torben Halkier (3)............................. 32,241 11,742
Jens Sigurd Okkels (3)......................... 32,241 11,742
Anders H. Pedersen (3)......................... 32,241 11,742
Hans Thalsgard Schambye (3).................... 32,241 11,742
Knud Aunstrup (4).............................. 12,896 4,697
Claus Braestrup (5)............................ 25,793 9,394
Thue W. Schwartz (4)........................... 12,896 4,697
Robert and Patricia Ronald Living Trust (6).... 14,652 8,955
Pamela Ronald (6).................................. 7,085 3,028
Yuelin Zhang (6)................................... 7,085 3,028
The Charles Associates, Inc. (6)................... 3,399 2,449
Xinnian Dong (6)................................... 2,835 1,211
Hiroaki Shizuya (6)................................ 1,890 808
Robert H. Eng (6).................................. 1,465 895
Karen Century (6).................................. 475 290
Xin Li (6)......................................... 357 218
Yujun Song (6)..................................... 238 145
Rodney Adamchak (6)................................ 119 73
George Georgiou (7)................................ 14,010 14,010
Alison Ross........................................ 10,000 10,000
(1) Mr. Mikkelsen is Co-President of Maxygen's protein pharmaceutical business.
Mr. Mikkelsen's stockholdings include (i) 76,255 shares that are subject to
our right of repurchase as of January 18, 2001, if Mr. Mikkelsen ceases his
employment with us and (ii) 16,187 shares that are subject to an escrow
agreement with Maxygen.
(2) Dr. Hansen is Co-President of Maxygen's protein pharmaceutical business.
Dr. Hansen's stockholdings include (i) 57,190 shares that are subject to our
right of repurchase as of January 18, 2001, if Dr. Hansen ceases his
employment with us and (ii) 12,140 shares that are subject to an escrow
agreement with Maxygen.
(3) This person is an employee of Maxygen ApS, a current Maxygen affiliate. This
person's stockholdings includes (i) 15,889 shares owned by this person that
are subject to our right of repurchase as of January 18, 2001, if this
person ceases his employment with us and (ii) 3,373 shares that are subject
to an escrow agreement with Maxygen.
(4) This person was a director of ProFound, a current Maxygen affiliate, prior
to Maxygen's acquisition of ProFound on August 10, 2000 (ProFound is now
known as Maxygen ApS). This person's stockholdings include 1,349 shares
that are subject to an escrow agreement with Maxygen. Mr. Aunstrup is a
current director of Maxygen ApS.
(5) Mr. Braestrup is a current director of Maxygen ApS. Mr. Braestrup's
stockholdings include 2,698 shares that are subject to an escrow agreement
(6) This person was a shareholder of a company acquired by Maxygen on May 8,
2000. The stockholdings of this person includes shares that are subject to
an escrow agreement with Maxygen related to the acquisition in the amount
Robert and Patricia Ronald Living Trust.......... 5,697
Pamela Ronald.................................... 4,057
Yuelin Zhang..................................... 4,057
The Charles Associates, Inc. .................... 950
Xinnian Dong..................................... 1,624
Hiroaki Shizuya.................................. 1,082
Robert H. Eng.................................... 570
Karen Century.................................... 185
Xin Li........................................... 139
Yujun Song....................................... 93
Rodney Adamchak.................................. 46
(7) In August 2000, Dr. Georgiou licensed certain technology to Maxygen.
PLAN OF DISTRIBUTION
The shares of common stock may be sold from time to time by the selling
stockholders in one or more transactions at fixed prices, at market prices at
the time of sale, at varying prices determined at the time of sale or at
negotiated prices. As used in this prospectus, "selling stockholders" includes
donees, pledgees, transferees and other successors in interest selling shares
received from a selling stockholder after the date of this prospectus as a gift,
pledge, partnership distribution or other non-sale transfer. Upon our being
notified by a selling stockholder that a donee, pledgee, transferee or other
successor in interest intends to sell shares, a supplement to this prospectus,
if required, will be filed. The selling stockholders may offer their shares of
common stock in one or more of the following transactions:
. on any national securities exchange or quotation service on which the
common stock may be listed or quoted at the time of sale, including
the Nasdaq National Market;
. in the over-the-counter market;
. in private transactions;
. through options;
. by pledge to secure debts and other obligations; or
. a combination of any of the above transactions.
If required, we will distribute a supplement to this prospectus to describe
material changes in the terms of the offering.
The shares of common stock described in this prospectus may be sold from
time to time directly by the selling stockholders. Alternatively, the selling
stockholders may from time to time offer shares of common stock to or through
underwriters, broker/dealers or agents. The selling stockholders and any
underwriters, broker/dealers or agents that participate in the distribution of
the shares of common stock may be deemed to be "underwriters" within the meaning
of the Securities Act of 1933. Any profits on the resale of shares of common
stock and any compensation received by any underwriter, broker/dealer or agent
may be deemed to be underwriting discounts and commissions under the Securities
Act of 1933. We have agreed to indemnify each selling stockholder against
certain liabilities, including liabilities arising under the Securities Act of
1933. The selling stockholders may agree to indemnify any agent, dealer or
broker-dealer that participates in the sale of shares of common stock described
in this prospectus against certain liabilities, including liabilities arising
under the Securities Act of 1933.
We entered into registration rights agreements for the benefit of the
selling stockholders to register certain shares of our common stock held by such
selling stockholders under applicable federal and state securities laws and
under specific circumstances and at specific times. The registration rights
agreements provide for cross-indemnification of the selling stockholders and us
and their and our respective directors, officers and controlling persons against
specific liabilities in connection with the offer and sale of the common stock,
including liabilities under the Securities Act of 1933.
Any shares covered by this prospectus that qualify for sale pursuant to
Rule 144 under the Securities Act of 1933 may be sold under Rule 144 rather than
pursuant to this prospectus. The selling stockholders may not sell all of the
shares they hold. The selling stockholders may transfer, devise or gift such
shares by other means not described in this prospectus.
To comply with the securities laws of certain jurisdictions, the common
stock must be offered or sold only through registered or licensed brokers or
dealers. In addition, in certain jurisdictions, the shares of common stock may
not be offered or sold unless they have been registered or qualified for sale or
an exemption is available and complied with.
Under the Securities Exchange Act of 1934, any person engaged in a
distribution of the common stock may not simultaneously engage in market-making
activities with respect to the common stock for five business days prior to the
start of the distribution. In addition, each selling stockholder and any other
person participating in a distribution will be subject to the Securities
Exchange Act of 1934, which may limit the timing of purchases and sales of
common stock by the selling stockholders or any such other person. These
factors may affect the marketability of the common stock and the ability of
brokers or dealers to engage in market-making activities.
All expenses of this registration, estimated at approximately $30,000, will
be paid by us. These expenses include the SEC's filing fees and fees under state
securities or "blue sky" laws.
For the purpose of this offering, Heller Ehrman White & McAuliffe, LLP,
Menlo Park, CA is giving an opinion as to the validity of the common stock
offered by this prospectus. Heller Ehrman White & McAuliffe, LLP and certain of
its employees, beneficially own 27,680 shares of Maxygen common stock. Julian N.
Stern, the sole shareholder of a professional corporation that is a partner of
Heller Ehrman White & McAuliffe, LLP and the Secretary of Maxygen, beneficially
owns 65,702 shares of Maxygen common stock.
Ernst & Young LLP, independent auditors, have audited our financial
statements included in our Annual Report on Form 10-K for the year ended
December 31, 1999, as set forth in their report, which is incorporated by
reference in this prospectus and elsewhere in the registration statement. Our
financial statements are incorporated by reference in reliance on Ernst & Young
LLP's report, given on their authority as experts in accounting and auditing.
The financial statements of ProFound Pharma A/S incorporated in this prospectus
by reference to the Maxygen current report on Form 8-K/A dated October 24, 2000,
have been so incorporated in reliance on the report of Grant Thornton Denmark
Ltd., independent auditors, given on the authority of Grant Thornton Denmark
Ltd. as experts in auditing and accounting.
We have not authorized any dealer, sales person or other person to give any
information or to make any representations other than those contained in this
prospectus or any prospectus supplement. This prospectus is not an offer of
these securities in any state where an offer is not permitted. The information
in this prospectus is current as of , 2001. You should not
assume that this prospectus is accurate as of any other date.
TABLE OF CONTENTS
Prospectus Summary....................................................... 3
Forward-Looking Statements............................................... 4
Risk Factors............................................................. 5
Use of Proceeds.......................................................... 17
Dividend Policy.......................................................... 17
Where You Can Find More Information...................................... 17
Selling Stockholders..................................................... 19
Plan of Distribution..................................................... 21
Legal Matters............................................................ 22
[LOGO OF MAXYGEN]
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, if any, all of which will be paid by
Maxygen in connection with the distribution of the common stock being
registered. All amounts are estimated, except the SEC registration fee:
SEC registration fee........................................ $ 1,438
Printing and engraving...................................... 5,000
Legal fees and expenses..................................... 10,000
Accounting fees and expenses................................ 10,000
Item 15. Indemnification of Officers and Directors.
Section 102(b)(7) of the Delaware General Corporation Law (the "DGCL")
allows a corporation to eliminate the personal liability of directors of a
corporation to the corporation or to any of its stockholders for monetary damage
for a breach of his or her fiduciary duty as a director, except in the case
where the director breached his or her duty of loyalty, failed to act in good
faith, engaged in intentional misconduct or knowingly violated a law, authorized
the payment of a dividend or approved a stock repurchase in violation of the
DGCL or obtained an improper personal benefit. Maxygen's Amended and Restated
Certificate of Incorporation contains a provision that eliminates directors'
personal liability as set forth above.
Under Section 145 of the DGCL, Maxygen has broad powers to indemnify its
directors and officers against liabilities they may incur in such capacities,
including liabilities under the Securities Act. Maxygen's Certificate of
Incorporation and By-laws require Maxygen to indemnify its directors and
officers to the full extent permitted by the DGCL. The Certificate of
Incorporation and By-laws also require Maxygen to advance litigation expenses
upon receipt of an undertaking by the indemnified party to repay such advances
if it is ultimately determined that the indemnified party is not entitled to
Maxygen has entered into indemnity agreements with each of its directors
and officers. Such indemnity agreements contain provisions that are in some
respects broader than the specific indemnification provisions contained in the
DGCL. Maxygen also maintains an insurance policy for its directors and officers
insuring against certain liabilities arising in their capacities as such.
Item 16. Exhibits and Financial Statement Schedules.
Number Description of Exhibit
5.1 Opinion of Heller Ehrman White & McAuliffe LLP
23.1 Consent of Ernst & Young LLP, Independent Auditors
23.2 Consent of Grant Thornton Denmark Ltd., Independent Auditors
23.3 Consent of Heller Ehrman White & McAuliffe LLP (included in Exhibit
24* Power of Attorney
* Previously filed.
Item 17. Undertakings.
1. The undersigned registrant hereby undertakes:
(a) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(I) To include any prospectus required by section 10(a)(3) of the
(II) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar
value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form
of prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement;
(III) To include any material information with respect to the plan
of distribution not previously disclosed in the registration
statement or any material change to such information in the
provided, however, that paragraphs (a)(i) and (a)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to section 13 or section 15(d) of the
Exchange Act that are incorporated by reference in the registration statement.
(b) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed
to be a new registration statement relating to
the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
(C) To remove from registration by means of a post-effective amendment
any of the securities being registered that remain unsold at the
termination of the offering.
2. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
3. Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and has duly caused this amendment to the
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in Redwood City, CA, on January 19, 2001.
By: /s/ Russell J. Howard
Russell J. Howard
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this amendment
to the registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
<S> <C> <C>
Chief Executive Officer and Director January 19, 2001
/s/ Russell J. Howard (Principal Executive Officer)
Russell J. Howard
* Chief Financial Officer (Principal January 19, 2001
------------------------------------------- Financial and Accounting Officer)
Lawrence W. Briscoe
* Director January 19, 2001
<S> <C> <C>
* Director January 19, 2001
Robert J. Glaser
* Director January 19, 2001
* Director January 19, 2001
* Director January 19, 2001
* By: /s/ Michael Rabson
Number Description of Exhibit Page Numbers
<S> <C> <C>
5.1 Opinion of Heller Ehrman White & McAuliffe LLP
23.1 Consent of Ernst & Young LLP, Independent Auditors
23.2 Consent of Grant Thornton Denmark Ltd., Independent Auditors
23.3 Consent of Heller Ehrman White & McAuliffe LLP (included in Exhibit
24* Power of Attorney
* Previously filed