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EXHIBIT 2.1
DIADEXUS, LLC
CONVERSION AGREEMENT
This Agreement (the "Agreement") is made as of the 3rd day of April
2000, by and among diaDexus, LLC, a Delaware limited liability company (the
"Company"), SmithKline Beecham Corporation, a Pennsylvania corporation ("SB")
and Incyte Pharmaceuticals, Inc., a Delaware corporation ("Incyte").
RECITALS
WHEREAS, the Company was formed as a limited liability company under the
laws of the State of Delaware, pursuant to that certain Operating Agreement
dated as of September 2, 1997, as amended ("Operating Agreement") with Incyte
and SB as its sole members (collectively, the "Members");
WHEREAS, the Members and the Company entered into that certain Master
Strategic Relationship Agreement dated as of September 2, 1997 ("Master
Agreement"), pursuant to which Incyte and SB received membership interests in
the Company in consideration for initial and subsequent contributions of cash
and certain assets to the Company;
WHEREAS, the Company entered into certain agreements with Incyte
pursuant to which the Company obtained access to certain intellectual property
from Incyte, including, (a) that certain Collaborative LifeSeq Agreement dated
as of September 2, 1997, as amended, (b) that certain Collaborative Pathoseq
Database Agreement dated as of September 2, 1997, as amended, and (c) that
certain Collaborative Agreement dated as of February 17, 2000, which superseded
both (a) and (b) (hereinafter referred to as the "Incyte Collaborative
Agreement");
WHEREAS, the Company entered into that certain Collaboration and License
Agreement by and between SB, SmithKline Beecham plc, an English corporation ("SB
plc"), Incyte and the Company, dated as of September 2, 1997, as amended (the
"SB Collaboration Agreement," and collectively with the Incyte Collaboration
Agreement, the "Collaboration Agreements");
WHEREAS, in order to facilitate additional financing for the Company
pursuant to that certain Series C Preferred Stock Purchase Agreement (the
"Series C Agreement") to be executed substantially concurrently herewith, the
parties desire to convert the Company from a limited liability company into a
Delaware corporation (the "Conversion");
WHEREAS, in connection with the Conversion and the Series C round of
financing of the Company, the parties desire to reaffirm certain rights,
privileges and obligations under the Master Agreement and the Collaboration
Agreements;
AGREEMENT
In consideration of the mutual promises contained herein and the
foregoing premises which are hereby incorporated as part of the parties'
agreement, the parties agree as follows:
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1. CONVERSION FROM LLC TO CORPORATION.
1.1 CONSENT. The Members hereby consent to, and waive any provision
of any agreement to which they are a party that would prohibit or restrict, the
conversion of the Company from a limited liability company organized under the
laws of the State of Delaware to a corporation incorporated in the State of
Delaware pursuant to Section 265 of the Delaware General Corporation Law and
Section 18-216 of the Delaware Limited Liability Company Act. The corporation
resulting from the Conversion (the "Resulting Corporation") shall be treated for
all purposes as a corporation subject to subchapter C of the Internal Revenue
Code, and shall make no elections to the contrary. The parties agree to execute,
acknowledge and deliver such further instruments, and to do all such other acts,
as may be necessary or appropriate in order to carry out the Conversion in
accordance with (i) such statutes and (ii) the purposes and intent of this
Agreement.
1.2 FORM AND INITIAL CAPITALIZATION OF THE RESULTING CORPORATION.
The Resulting Corporation shall be governed by a Certificate of Incorporation to
be filed with the Secretary of State of Delaware in the form attached hereto as
Exhibit A, as such certificate may be amended from time to time in accordance
with its terms, and By-laws in the form attached hereto as Exhibit B. Pursuant
to the Conversion, the Resulting Corporation shall issue (a) to SB 4,400,000
shares of its Series A Preferred Stock and 100 shares of its Common Stock as
consideration for SB's interests in the Company; (b) to Incyte 4,400,000 shares
of its Series B Preferred Stock and 100 shares of its Common Stock as
consideration for Incyte's interests in the Company; and (c) replacement options
to employees of the Company who hold options pursuant to its 1997 Incentive
Plan, with such replacement options to have economic terms substantially similar
to those of the options replaced, and to be issued pursuant to an equity
incentive plan to be adopted by the Board of Directors of the Resulting
Corporation and approved by its stockholders. Upon issuance pursuant to the
Conversion, all of the shares of Common Stock, Series A Preferred Stock and
Series B Preferred Stock will be duly and validly issued, fully paid and
non-assessable. Nothing in this Section 1.2 shall limit or restrict the right of
the Resulting Corporation from time to time to issue such additional equity
securities, including options or other securities exercisable for or convertible
or exchangeable into its capital stock, as may be approved by its Board of
Directors in accordance with the terms of its Certificate of Incorporation and
By-laws.
1.3 BOARD OF DIRECTORS AND OFFICERS. The members of the Board of
Directors and officers of the Company shall continue in office from and after
the effectiveness of the Conversion, subject to such resignations, elections and
appointments as may thereafter be effected in accordance with the terms of the
Certificate of Incorporation and By-laws.
1.4 MASTER AGREEMENT. The terms and conditions of the Master
Agreement contained in Sections 1.1 and 2.2 and those contained in Articles 3,
4, 5, 6, 7, 9, 10 (other than Section 10.7) shall continue in full force and
effect and be binding upon the parties after the Conversion as is contemplated
by Section 6.2(b) of the Master Agreement.
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1.5 WAIVER. The parties hereby waive any and all rights,
liabilities, claims or demands that may result from the failure to merge the
Company into a "C" Corporation in the manner and timeframe as contemplated by
Section 6.2(a) of the Master Agreement.
1.6 OPERATING AGREEMENT. Upon the effectiveness of the Conversion,
the parties hereby waive any and all rights, privileges and obligations under
the Operating Agreement, and thereupon the Operating Agreement shall be
terminated and of no further force or effect.
2. CONTINUATION OF OBLIGATIONS UNDER COLLABORATION AGREEMENTS. The terms
and conditions of the Collaboration Agreements shall remain in full force and
effect and be binding upon the parties to such agreements after the Conversion.
3. MISCELLANEOUS.
3.1 SUCCESSORS AND ASSIGNS. The terms and conditions of this
Agreement shall inure to the benefit of and be binding upon the respective
successors and assigns of the parties. Nothing in this Agreement, express or
implied, is intended to confer upon any party other than the parties hereto or
their respective successors and assigns any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as expressly provided
in this Agreement.
3.2 AMENDMENTS AND WAIVERS. Any term of this Agreement may be
amended or waived only with the written consent of each of the Company and the
Members. Any amendment or waiver effected in accordance with this Section 4.2
shall be binding upon the Company and the Members.
3.3 SEVERABILITY. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, the parties agree to renegotiate
such provision in good faith. In the event that the parties cannot reach a
mutually agreeable and enforceable replacement for such provision, then (a) such
provision shall be excluded from this Agreement, (b) the balance of the
Agreement shall be interpreted as if such provision were so excluded and (c) the
balance of the Agreement shall be enforceable in accordance with its terms.
3.4 GOVERNING LAW. This Agreement and all acts and transactions
pursuant hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State of
Delaware, without giving effect to principles of conflicts of law.
3.5 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.
3.6 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
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(Signature pages follow)
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The parties hereto have executed this Agreement as of the date first
written above.
DIADEXUS, LLC
By: /s/Patrick Plewman
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Name: Patrick Plewman
Title: President
SMITHKLINE BEECHAM CORPORATION
By: /s/Donald F. Parman
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Name: Donald F. Parman
Title: Secretary
INCYTE PHARMACEUTICALS, INC.
By: /s/Roy A Whitfield
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Name: Roy A Whitfield
Title: C.E.O
C-1
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EXHIBIT A
C-2
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EXHIBIT B
C-3
