<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 24, 2000
REGISTRATION NO. 333-92577
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
AFFYMETRIX, INC.
(Exact Name Of Registrant As Specified In Its Charter)
------------------------------
<TABLE>
<S> <C>
DELAWARE 77-0319159
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
</TABLE>
3380 CENTRAL EXPRESSWAY
SANTA CLARA, CALIFORNIA 95051
(408) 731-5000
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
------------------------------
VERN NORVIEL, ESQ.
SENIOR VICE PRESIDENT, GENERAL COUNSEL & SECRETARY
AFFYMETRIX, INC.
3380 CENTRAL EXPRESSWAY
SANTA CLARA, CALIFORNIA 95051
(408) 731-5000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
------------------------------
COPY TO:
STANLEY F. FARRAR, ESQ.
SULLIVAN & CROMWELL
1888 CENTURY PARK EAST
SUITE 2100
LOS ANGELES, CALIFORNIA 90067-1725
(310) 712-6600
------------------------------
APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC: From time to time after the
effective date of this registration statement.
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. / /
------------------------------
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 WHICH 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 SAID SECTION 8(A),
MAY DETERMINE.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
SUBJECT TO COMPLETION - DATED JANUARY 24, 2000
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THESE
SECURITIES MAY NOT BE SOLD UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS DECLARED EFFECTIVE. THIS PROSPECTUS IS NOT
AN OFFER TO SELL THESE SECURITIES AND IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
<PAGE>
P R O S P E C T U S
AFFYMETRIX, INC.
$150,000,000
5% CONVERTIBLE SUBORDINATED NOTES DUE 2006 AND
1,219,515 SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THE NOTES
---------------------
The selling security holders may sell the notes or the common stock into
which the notes are convertible. See "Plan of Distribution." The notes have the
following terms:
- We will pay interest on the notes on October 1 and April 1 of each year,
commencing on April 1, 2000.
- The notes will mature on October 1, 2006.
- The notes are subordinated to all of our existing and future senior
indebtedness.
- We may redeem some or all of the notes at any time after October 7, 2002,
at a redemption price equal to the principal amount of the notes we redeem
plus a premium, if any, and accrued and unpaid interest.
- The redemption price is described on page 17 of this prospectus.
- Each note holder has the right to require us to repurchase all or a
portion of the holder's notes upon a change of control.
- Holders may convert their notes at any time prior to maturity or
redemption into shares of our common stock at a conversion price of
$123.00 per share, which is equivalent to a conversion rate of 8.1301
shares per $1,000 principal amount of notes, and is subject to adjustment.
------------------------
Our common stock is listed on the Nasdaq National Market under the symbol
"AFFX." The last reported sale price of our common stock on the Nasdaq National
Market on January , 2000 was $__ per share. The notes are currently eligible
for trading on the PORTAL Market of the Nasdaq Stock Market.
------------------------
INVESTING IN THE NOTES OR THE COMMON STOCK INTO WHICH THE NOTES ARE
CONVERTIBLE INVOLVES RISKS. PLEASE CAREFULLY CONSIDER THE "RISK FACTORS"
BEGINNING ON PAGE 4 OF THIS PROSPECTUS.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this prospectus is , 2000.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<S> <C>
AFFYMETRIX, INC............................................. 3
RISK FACTORS................................................ 4
FORWARD-LOOKING STATEMENTS.................................. 10
WHERE YOU CAN FIND MORE INFORMATION......................... 10
INCORPORATION BY REFERENCE.................................. 10
USE OF PROCEEDS............................................. 11
RATIO OF EARNINGS TO FIXED CHARGES.......................... 11
DESCRIPTION OF NOTES........................................ 12
U.S. FEDERAL TAX CONSIDERATIONS............................. 24
SELLING SECURITY HOLDERS.................................... 28
PLAN OF DISTRIBUTION........................................ 31
VALIDITY OF THE SECURITIES.................................. 32
EXPERTS..................................................... 32
</TABLE>
------------------------
You should rely only on the information contained in this document or to
which we have referred you. We have not authorized anyone to provide you with
information that is different. This document may only be used where it is legal
to sell these securities. The information in this document may only be accurate
on the date of this document.
------------------------
2
<PAGE>
AFFYMETRIX, INC.
We are in the business of developing and selling DNA probe arrays and
related products that allow researchers to study genetic information in order to
help improve the diagnosis, monitoring and treatment of disease. DNA, which is a
common abbreviation for DEOXYRIBONUCLEIC ACID, provides the molecular blueprint
of every living organism and is made up of individual genes which determine what
attributes or characteristics a particular organism will have. DNA probe array
refers to a collection of DNA molecules attached to a surface, such as a piece
of glass, and designed for viewing under a microscope-type device known as a
scanner.
------------------------
We are a Delaware corporation, and our headquarters are located at 3380
Central Expressway, Santa Clara, California 95051. Our telephone number is
(408) 731-5000, and our e-mail address is [email protected]. We also maintain
an Internet home page at affymetrix.com. Information contained on our home page
is not part of this prospectus.
3
<PAGE>
RISK FACTORS
RISKS RELATING TO THE NOTES
IF WE GENERATE LOWER REVENUES OR FACE HIGHER EXPENDITURES THAN WE PROJECT, THEN
WE MAY NOT BE ABLE TO REPAY THE NOTES.
Our ability to pay the principal of and interest on our indebtedness,
including the notes, will depend on our future performance. At September 30,
1999, we had outstanding total liabilities of approximately $26.0 million,
excluding the notes. For the nine months ended September 30, 1999, our
deficiency of earnings available to cover fixed charges was approximately
$20.1 million. A variety of uncertainties and contingencies will affect our
future performance, many of which are beyond our control. We may not generate
sufficient cash flow in the future to enable us to meet our anticipated fixed
charges, including our debt service requirements with respect to the notes.
Because of our substantial indebtedness, we may be unable to adjust to meet
changing conditions in the future.
Our substantial leverage could have several important consequences for our
future operations, including:
- increasing our vulnerability to general adverse economic and industry
conditions;
- limiting our ability to obtain additional financing;
- requiring the dedication of a substantial portion of our expected cash
flow from operations to service indebtedness, thereby reducing the amount
of expected cash flow available for other purposes, including working
capital and capital expenditures;
- limiting our flexibility in planning for, or reacting to, changes in our
business and the industry in which we compete; or
- placing us at a possible competitive disadvantage compared to less
leveraged competitors and competitors that have better access to capital
resources.
IF WE ARE UNABLE TO PAY ALL OUR DEBTS, THEN YOU WILL RECEIVE PAYMENTS ON THE
NOTES ONLY IF WE HAVE FUNDS REMAINING AFTER WE HAVE REPAID OUR EXISTING AND
FUTURE SENIOR INDEBTEDNESS.
The notes are general unsecured obligations. We may repay the notes only
after we have paid all of our existing and future senior indebtedness. Upon any
distribution of our assets because of insolvency, bankruptcy, dissolution,
winding up, liquidation or reorganization, we may pay the principal of and
interest on the notes only to the extent provided in the indenture, and only
after we pay all of our senior indebtedness in full. Senior indebtedness
includes all indebtedness for money borrowed, other than indebtedness that is
expressly junior or equal in right of payment to the notes. As of September 30,
1999, we had approximately $327,000 of indebtedness outstanding that would have
constituted senior indebtedness. As of September 30, 1999, our subsidiary had no
material indebtedness or other liabilities. We anticipate that from time to time
we will incur additional indebtedness, including senior indebtedness.
The following table shows the aggregate amount of our principal and interest
payments due in each of the next five years:
<TABLE>
<CAPTION>
YEAR AGGREGATE PRINCIPAL AGGREGATE INTEREST
- ---- ------------------- ------------------
<S> <C> <C>
2000 261,350 7,519,000
2001 -- 7,500,000
2002 -- 7,500,000
2003 -- 7,500,000
2004 -- 7,500,000
</TABLE>
4
<PAGE>
WE MAY BE UNABLE TO PURCHASE THE NOTES.
At maturity, the entire outstanding principal amount of the notes will
become due and payable by us. In addition, in the event of a change in control,
each holder of notes will have the right, at the holder's option, to require us
to purchase all or any part of that holder's notes. We cannot assure you that we
will have sufficient financial resources or will be able to arrange financing to
pay the principal amount or the purchase price of the notes.
Under the terms of the indenture, in the event of a change in control, we
may elect, if we meet certain conditions, to pay the purchase price with shares
of our common stock; a payment in common stock would have a dilutive effect on
holders of our common stock and could cause the market price of our common stock
to decline.
Our ability to purchase the notes in the event of a change in control,
whether in cash or in common stock, may be limited by law, the indenture and the
terms of other agreements relating to borrowings that constitute senior
indebtedness, as such indebtedness or agreements may be entered into, replaced,
supplemented or amended at any time or from time to time. We may be required to
refinance our senior indebtedness in order to make any payment. We may not have
the financial ability to purchase the notes in the event payment of our senior
indebtedness is accelerated.
The term "change in control" may not include other events that might
adversely affect our financial condition or result in a downgrade of the credit
rating of the notes, nor would the requirement that we offer to purchase the
notes upon a change in control necessarily afford holders of the notes
protection in the event of a highly leveraged transaction, reorganization,
merger or similar transaction. The term "change in control" does not apply to
transactions in which 90% of the consideration paid for our common stock in a
merger or similar transactions consists of common stock and in certain other
circumstances where our common stock is trading at a premium over the conversion
price. See "Description of Notes--Right to Require Purchase of Notes Upon a
Change in Control."
THERE IS NO PUBLIC MARKET FOR THE NOTES, AND THERE ARE RESTRICTIONS ON RESALE OF
THE NOTES.
The notes are currently eligible to trade on the PORTAL Market of the Nasdaq
Stock Market. Although the initial purchasers have advised us that they
currently intend to make a market in the notes, they are not obligated to do so
and may discontinue market making activities at any time without notice.
Consequently, we cannot ensure that any market for the notes will develop or, if
one does develop, that it will be maintained. If an active market for the notes
fails to develop or be sustained, the trading price of the notes could be
materially and adversely affected. We do not intend to apply for listing of the
notes on any securities exchange or any automated quotation system.
RISKS RELATING TO AFFYMETRIX AND ITS BUSINESS
THE MARKET PRICE OF OUR COMMON STOCK IS EXTREMELY VOLATILE, AND THE VALUE OF
YOUR AFFYMETRIX STOCK MAY DECREASE SUDDENLY.
For a number of reasons, the market price of our common stock is extremely
volatile, and the value of the common stock you receive may be significantly
less than the market value of that stock today. This extreme volatility also
puts us at risk for securities class action litigation, which would cause us to
divert both financial and managerial resources, which could reduce our profits.
To demonstrate the volatility of our stock price, during the last twelve
months the volume of our common stock traded on any given day has ranged from
29,200 to 1,908,200 shares, a 553% difference. Moreover, during the same twelve
months our common stock has traded as low as $27 1/2 per share and as high as
$195 1/2 per share, a $611% difference. The market price of our common stock has
changed as much as $36.25 per share on a single day and our stock price has
changed more than $10 in a single day twenty one times in the last six months.
By comparison, during the same period the Dow Jones Advanced Medical
5
<PAGE>
Devices Index ranged from a low 2,746.69 to high of 3,504.38, a 27% difference,
and the NASDAQ Composite Index ranged from a low of 2,193.13 to a high of
4,192.19, a 91% difference.
OUR QUARTERLY RESULTS OF OPERATIONS HAVE HISTORICALLY FLUCTUATED SIGNIFICANTLY
PERIOD-TO-PERIOD, AND OUR STOCK MAY DECREASE IN VALUE SIGNIFICANTLY FOLLOWING AN
EARNINGS RELEASE.
Although we believe that period-to-period comparisons of our results of
operations are not a good indication of our future performance, our operating
results will likely be below the expectations of public market analysts or
investors in future quarters and the market price of our common stock may fall
significantly.
WE HAVE A LIMITED OPERATING HISTORY, HAVE NEVER BEEN PROFITABLE AND MAY NEVER
DEVELOP A COMMERCIALLY SUCCESSFUL PRODUCT.
We are a relatively new company and, for the most part, our technologies are
still in the early stages of development. We have just begun to incorporate our
technologies into commercial products. We need to make significant investments
to ensure our products perform correctly and are cost-effective. In addition, we
must obtain additional regulatory approvals to sell our product for purposes
other than research use. Even if we develop our products for commercial use and
obtain all necessary regulatory approvals, we may not be able to develop
products that:
- are accepted by the research, diagnostic or other market places;
- are accurate and effective;
- meet applicable regulatory standards in a timely manner;
- are protected from competition by others;
- don't infringe the intellectual proprietary rights of others;
- can be manufactured in sufficient quantities or at a reasonable cost; or
- can be marketed successfully.
WE MAY LOSE CUSTOMERS UNLESS WE IMPROVE OUR ABILITY TO MANUFACTURE OUR PRODUCTS
AND ENSURE THEIR PROPER PERFORMANCE.
We produce our GeneChip products in an innovative and complicated
manufacturing process. We've experienced and continue to experience significant
variability in the manufacturing yield of our GeneChip products which has
reduced, and we believe will continue to reduce, our gross margins and business.
We have also experienced, and anticipate that we will continue to experience,
difficulties in meeting customer, collaborator and internal demand for some of
our probe array products. If we can't deliver products in a timely manner, we
could lose customers, delay introduction of new products or cause demand for our
products to decline. Furthermore, if we can't deliver products to our customers
that consistently meet their performance expectations, demand for our products
will decline.
Because we have a limited manufacturing history, we don't fully understand
all of the factors that affect our manufacturing processes. As a result,
manufacturing and quality control problems have arisen and we expect them to
continue to arise as we attempt to increase the production rate at our
manufacturing facilities. We may not be able to increase production rates at
these facilities in a timely and cost-effective manner or at commercially
reasonable cost.
6
<PAGE>
OUR SURVIVAL DEPENDS ON OUR ABILITY TO AVOID INFRINGING THE INTELLECTUAL
PROPERTY OF OTHERS AS WELL AS MAINTAINING, ENFORCING AND OBTAINING INTELLECTUAL
PROPERTY RIGHTS OF OUR OWN.
Intellectual property rights are essential to our business. We're engaged in
significant litigation with our competitors regarding both our intellectual
property rights and their rights which consume, and will continue to consume,
substantial portions of our financial and managerial resources. A loss of a
significant litigation could prevent us from producing our current products or
developing new ones and could also result in the payment of significant
penalties and royalties, which could make it too costly to produce some or all
of our products. If we can't maintain, enforce or obtain intellectual property
rights, competitors can design probe array systems with similar competitive
advantages to our GeneChip technology without paying us royalties. In order to
continue our current business, we must successfully:
- defend against third parties asserting that we infringe their intellectual
property rights;
- enforce our intellectual property rights against third parties infringing
our rights;
- obtain licenses to the intellectual property we need to continue or expand
our business;
- obtain enforceable patent rights to our product and process innovations;
and
- defend the scope of our existing or pending patents in administrative
proceedings, such as oppositions or interferences.
Moreover, even if we defend and enforce our intellectual property rights,
others may independently develop similar or alternative technologies, duplicate
any of our technologies, or design around or invalidate our patented
technologies. These developments would reduce the value of our intellectual
property assets.
IF WE CAN'T CONTINUOUSLY DEVELOP AND INTRODUCE NEW PRODUCTS WE WON'T BE ABLE TO
COMPETE SUCCESSFULLY IN OUR HIGHLY COMPETITIVE AND RAPIDLY CHANGING MARKET.
We compete in markets that are new, intensely competitive, highly fragmented
and rapidly changing and many of our current and potential competitors have
significantly greater financial, technical, marketing and other resources. In
addition, many current and potential competitors have greater name recognition,
more extensive customer bases and access to proprietary genetic content. We
cannot survive if we fail to respond quickly to new or emerging technologies and
changes in customer requirements.
Currently, our principal competition comes from existing DNA probe array and
other technologies that are used to perform many of the same functions for which
we market our GeneChip products. In order to compete against existing and newly
developed technologies and maintain pricing and gross margins, we need to
successfully demonstrate to potential customers that our GeneChip products
provide improved performance and capabilities. A large number of publicly traded
and privately held companies including CuraGen, Gene Logic, General
Scanning, Inc., Corning, Genome Solutions, Hewlett Packard, Hitachi,
Incyte/Synteni, Lynx and Motorola also are developing or have developed DNA
probe based assays or other products and services, some of which may be
competitive with Affymetrix'.
WE DEPEND ON A LIMITED NUMBER OF SUPPLIERS AND WE'LL BE UNABLE TO MANUFACTURE
OUR PRODUCTS IF SHIPMENTS FROM THESE SUPPLIERS ARE DELAYED OR INTERRUPTED.
Key parts of our GeneChip product line, as well as various equipment and raw
materials used in the synthesis of probe arrays, are currently available only
from a single source or a limited number of sources. In addition, components of
our manufacturing equipment are available from one of only a few suppliers. In
the event that supplies from these vendors were delayed or interrupted for any
reason, we wouldn't be able to get manufacturing equipment, scanners or other
components for our GeneChip product in a timely fashion or in sufficient
quantities or under acceptable terms.
7
<PAGE>
We rely on Agilent Technologies to manufacture, install and service our
scanners and on Enzo to manufacture key reagents used with probe arrays and
various labeling kits needed to process samples. Even if alternative sources of
supply are available, it could be time consuming and expensive for us to qualify
new vendors. In addition, we're dependent on our vendors to provide components
of appropriate quality and reliability and to meet applicable regulatory
requirements. Consequently, in the event that supplies from these vendors were
delayed or interrupted for any reason, we could be delayed in our ability to
develop and deliver products to our customers.
IF WE'RE UNABLE TO MAINTAIN OUR RELATIONSHIPS WITH COLLABORATIVE PARTNERS, WE
MAY HAVE DIFFICULTY SELLING OUR PRODUCTS AND SERVICES.
We believe that our success in penetrating our target markets depends in
part on our ability to develop and maintain collaborative relationships with key
companies as well as with key academic researchers. Our collaborative partners,
however, may not be able to perform their obligations as expected or devote
sufficient resources to the development, clinical testing, supply or marketing
of our potential products developed under these collaborations.
Currently, our significant collaborative partners include Agilent
Technologies, bio Merieux, Amersham Pharmacia Biotech KK and Roche Molecular
Systems. Relying on these or other collaborative relationships is risky to our
future success because:
- our partners may be developing technologies or components competitive with
our GeneChip product;
- our existing collaborations may preclude us from entering into additional
future arrangements;
- our partners may not obtain regulatory approvals necessary to continue the
collaborations in a timely manner;
- some of our agreements may prematurely terminate due to disagreements
between us and our partners;
- our partners may not devote sufficient resources to the development and
sale of our products;
- our partners may be unable to supply products to us on a timely basis;
- our collaborations may be unsuccessful; or
- we may not be able to negotiate future collaborative arrangements on
acceptable terms.
OUR CURRENT SALES, MARKETING AND TECHNICAL SUPPORT ORGANIZATION MAY LIMIT OUR
ABILITY TO SELL OUR PRODUCTS.
We currently have limited sales, marketing and technical support services.
To assist our sales and support activities, we entered into a nonexclusive
distribution agreement covering Japan with Amersham Pharmacia Biotech KK and a
service agreement for our GeneArray scanner with Agilent Technologies. Although
we have invested significant other resources to expand our direct sales force
and our technical and support staff, we may not be able to establish a
sufficiently sized sales, marketing or technical support organization to sell,
market or support our products.
Moreover, we feel that relying on third parties such as Amersham Pharmacia
Biotech KK and Agilent Technologies for sales, marketing and technical support
is risky because these third parties may decide to sell competitive products or
otherwise become our competitors.
8
<PAGE>
THE LOSS OF A KEY CUSTOMER COULD SUBSTANTIALLY REDUCE OUR REVENUES AND BE
PERCEIVED AS A LOSS OF MOMENTUM IN OUR BUSINESS.
Our customers are concentrated in a small number of pharmaceutical and
biotechnology companies, academic research centers and clinical reference
laboratories. We expect that a small number of customers, such as F.
Hoffman-LaRoche, Ltd., Genetics Institute and other key customers, will continue
to account for a substantial portion of revenues for the foreseeable future. If
we lose a major customer, our revenues may be substantially reduced and
investors may perceive this as a loss of momentum in our business. Moreover, if
consolidation in the pharmaceutical and biotechnology industries continues, our
current and potential customers could decrease or slow aggregate sales of our
technology and shrink our target market.
BECAUSE OUR BUSINESS IS HIGHLY DEPENDENT ON KEY EXECUTIVES AND SCIENTISTS, OUR
INABILITY TO RECRUIT AND RETAIN THESE PEOPLE COULD HINDER OUR BUSINESS EXPANSION
PLANS.
We are highly dependent on our executive officers and our senior scientists
and engineers, including our scientific advisors. Our product development and
marketing efforts will be delayed or curtailed if we lose the services of any of
these people.
We rely on our scientific advisors and consultants to assist us in
formulating our research, development and commercialization strategy. All of
these individuals are engaged by employers other than us and have commitments to
other entities that may limit their availability to us. Some of them also
consult for companies that may be our competitors. A scientific advisor's other
obligations may prevent him from assisting us in developing our technical and
business strategies.
To expand our research, product development and sales efforts we need
additional people skilled in areas such as bioinformatics, organic chemistry,
information services, regulatory affairs, manufacturing, sales, marketing and
technical support. Competition for these people is intense and their turnover
rate is high. We won't be able to expand our business if we are unable to hire,
train and retain a sufficient number of qualified employees.
WE MAY EXPERIENCE OPERATING DISRUPTIONS IF OUR PRODUCTS OR THE PRODUCTS UPON
WHICH WE DEPEND MALFUNCTION OR BECOME UNAVAILABLE BECAUSE OF YEAR 2000 PROBLEMS.
We've assessed the potential impact of the year 2000 computer problem on our
products and operations, the ability of third parties to supply critical
materials and services as well as the readiness of our key customers. While we
don't anticipate a material business interruption, we may experience a business
interruption if our operations, or any key third party supplier, services
provider or major customer are not year 2000 ready. We implemented a year 2000
contingency plan that involved purchasing and building inventory over the
remainder of 1999 so that we'll be able to continue to operate in the event of a
modest and short-term supply shortage resulting from any year 2000 problems
experienced by our suppliers.
BECAUSE GLAXO WELLCOME OWNS A SUBSTANTIAL PORTION OF OUR OUTSTANDING CAPITAL
STOCK, IT MAY BE ABLE TO INFLUENCE THE OUTCOME OF STOCKHOLDER VOTES OR THE
MARKET PRICE OF OUR STOCK.
Glaxo Wellcome, plc and its affiliates currently beneficially own
approximately 31% of our outstanding common stock. Although we've executed a
governance agreement with Glaxo, Glaxo nevertheless may be able to influence the
outcome of stockholder votes, including votes concerning the election of
directors, adoption of amendments to our certificate of incorporation and bylaws
and approval of mergers and other significant corporate transactions. Moreover
our stock price may drop if Glaxo sells a significant amount of our stock or if
investors interpret any sale of our stock by Glaxo as a sign of weakness in our
business.
9
<PAGE>
FORWARD-LOOKING STATEMENTS
All statements in this prospectus that are not historical are
forward-looking statements within the meaning of Section 21E of the Securities
Exchange Act of 1934, including statements regarding our "expectations,"
"beliefs," "hopes," "intentions," "strategies" or the like. These statements are
based on our management's current expectations and are subject to a number of
factors and uncertainties that could cause actual results to differ materially
from those described in the forward-looking statements. We caution investors
that there can be no assurance that actual results or business conditions will
not differ materially from those projected or suggested in these forward-looking
statements as a result of various factors, including but not limited to, the
risk factors contained in this prospectus. We expressly disclaim any obligation
or undertaking to release publicly any updates or revisions to any
forward-looking statements contained in this prospectus to reflect any change in
our expectations with regard to these statements or any change in events,
conditions or circumstances on which any of these statements is based.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC under the Exchange Act. The Exchange Act file number
for our SEC filings is 0-28218. You may read and copy any document we file at
the following SEC public reference rooms:
<TABLE>
<S> <C> <C>
450 Fifth Street, N.W. 500 West Madison Street 7 World Trade Center
Room 1024 14th Floor Suite 1300
Washington, D.C. 20549 Chicago, Illinois 60661 New York, New York 10048
</TABLE>
You may obtain information on the operation of the public reference room in
Washington, D.C. by calling the SEC at 1-800-SEC-0330.
We file information electronically with the SEC. Our SEC filings are
available from the SEC's Internet site at http://www.sec.gov, which contains
reports, proxy and information statements and other information regarding
issuers that file electronically.
Our common stock is listed on the Nasdaq National Market under the symbol
"AFFX." You may read and copy our SEC filings and other information at the
offices of Nasdaq Operations, 1735 K Street, N.W., Washington, D.C. 20006.
Except as described under "Incorporation by Reference," the information on
file with the SEC and the Nasdaq National Market does not constitute part of
this prospectus.
INCORPORATION BY REFERENCE
The SEC allows us to "incorporate by reference" certain documents we file
with it, which means that we can disclose important information to you by
referring you to those documents. The information in the documents incorporated
by reference is considered to be part of this prospectus. However, to the extent
the information contained in this prospectus is inconsistent with information
previously filed with the SEC, the information contained in this prospectus
supersedes this incorporated information. Information in documents that we file
later with the SEC will automatically update and supersede information included
or incorporated by reference in this prospectus. We incorporate by reference the
documents listed below and any future filings we will make with the SEC under
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act:
- Form 8-A filed on October 16, 1998;
- Annual Report on Form 10-K for the year ended December 31, 1998;
- Current Reports on Form 8-K filed on April 1, 1999 and September 28, 1999;
- Definitive Proxy Statement on Schedule 14A filed on April 29, 1999; and
- Quarterly Reports on Form 10-Q for the quarters ended March 31, 1999,
June 30, 1999, and September 30, 1999.
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Upon written or oral request, we will provide at no cost to each person to
whom a prospectus is delivered, including any beneficial owner, a copy of any
and all of the information that has been incorporated by reference in this
prospectus. To request a copy of any or all of these documents, you should write
or telephone us at: 3380 Central Expressway, Santa Clara, California 95051,
(408) 731-5000, Attention: Senior Vice President and General Counsel.
USE OF PROCEEDS
We will not receive any proceeds from the sale of the notes or the shares of
common stock offered by this prospectus. See "Selling Security Holders."
RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
NINE MONTHS ENDED
FOR THE YEARS ENDED DECEMBER 31, SEPTEMBER 30,
---------------------------------------------------- -------------------
1998 1997 1996 1995 1994 1999 1998
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Deficiency of earnings
available to cover
fixed charges(1)....... $(25,451) $(22,526) $(12,227) $(10,747) $(9,680) $(20,100) $(18,239)
</TABLE>
- ------------------------
(1) Earnings consist of net loss available to common stockholders. Fixed charges
consist of interest expense, including amortization of debt issuance costs,
and that portion of rental expense we believe to be representative of
interest.
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<PAGE>
DESCRIPTION OF NOTES
THE NOTES WERE ISSUED UNDER A CONTRACT CALLED AN INDENTURE, DATED AS OF
SEPTEMBER 22, 1999, BETWEEN US AND THE BANK OF NEW YORK, AS TRUSTEE. THE
FOLLOWING DESCRIPTION IS ONLY A SUMMARY OF THE MATERIAL PROVISIONS OF THE
INDENTURE, THE NOTES AND THE REGISTRATION RIGHTS AGREEMENT. WE URGE YOU TO READ
THE INDENTURE, THE NOTES AND THE REGISTRATION RIGHTS AGREEMENT IN THEIR ENTIRETY
BECAUSE THEY, AND NOT THIS DESCRIPTION, DEFINE YOUR RIGHTS AS HOLDERS OF THESE
NOTES. YOU MAY REQUEST COPIES OF THESE DOCUMENTS AT OUR ADDRESS PROVIDED IN
"INCORPORATION BY REFERENCE." THE TERMS OF THE NOTES INCLUDE THOSE STATED IN THE
INDENTURE AND THOSE MADE PART OF THE INDENTURE BY REFERENCE TO THE TRUST
INDENTURE ACT OF 1939.
GENERAL
The notes are unsecured, subordinated obligations. We issued the notes in
the principal amount of $150,000,000. Interest on the notes will accrue at the
rate of 5% per year and will be payable semiannually in arrears on October 1 or
April 1 of each year, commencing on April 1, 2000. Interest on the notes will
accrue from the date of original issuance or, if interest has already been paid,
from the date it was most recently paid. We will make each interest payment to
the holders of record of the notes on the immediately preceding September 15 or
March 15, whether or not such day is a business day. The notes will mature on
October 1, 2006.
We will pay the principal of, premium, if any, and interest on the notes at
the office or agency maintained by us in the Borough of Manhattan in New York
City. Holders may register the transfer of their notes at the same location. We
reserve the right to pay interest to holders of the notes by check mailed to
their registered addresses or by wire transfer. Interest on the notes will be
computed on the basis of a 360-day year comprised of twelve 30-day months.
Except under limited circumstances, the notes will be represented by one or
more global notes. There will be no service charge for any registration of
transfer or exchange of notes. We may, however, require holders to pay a sum
sufficient to cover any tax or other governmental charge payable in connection
with any transfer or exchange.
BOOK-ENTRY, DELIVERY AND FORM
We will issue the notes in the form of one or more global notes except as
described under "Certificated Notes" below. The global notes will be deposited
with, or on behalf of, the clearing agency registered under the Exchange Act
that is designated to act as depositary for the notes and registered in the name
of the depositary or its nominee. The Depository Trust Company, or DTC, will be
the initial depositary. Except as described below, the global notes may be
transferred, in whole and not in part, only to the depositary or another nominee
of the depositary. You may hold beneficial interests in the global notes
directly through the depositary if you have an account with the depositary or
indirectly through organizations which have accounts with the depositary.
The depositary has advised us that it is:
- a limited-purpose trust company organized under the laws of the State of
New York;
- a member of the Federal Reserve System;
- a "clearing corporation" within the meaning of the New York Uniform
Commercial Code; and
- a "clearing agency" registered under the provisions of Section 17A of the
Exchange Act.
The depositary was created to hold securities of institutions, known as
participants, that have accounts with the depositary and to facilitate the
clearance and settlement of securities transactions among its participants
through electronic book-entry changes. This system eliminates the need for
physical movement of certificates representing securities. The depositary's
participants include securities brokers and
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<PAGE>
dealers, banks, trust companies, clearing corporations and other organizations.
Access to the depositary's book-entry system is also available to others that
clear through or maintain a custodial relationship with a participant.
Upon the issuance of the global notes, the depositary credited, on its
book-entry registration and transfer system, the principal amount of notes
represented by the global notes to the accounts of participants. The initial
purchasers designated the accounts to be credited. Ownership of beneficial
interests in a global note is limited to participants or persons that may hold
interests through participants. Ownership of beneficial interests in the global
notes is shown on, and the transfer of those ownership interests will be
effected only through, records maintained by the depositary and the
participants. The laws of some jurisdictions may require that purchasers of
securities take physical delivery of securities in definitive form, and these
limits and laws may impair the ability to transfer or pledge beneficial
interests in a global note.
So long as the depositary or its nominee is the registered holder and owner
of a global note, the depositary or its nominee will be considered the sole
legal owner and holder of the related notes for all purposes. Except as
described below, as an owner of a beneficial interest in a global note, you will
be subject to the following limitations:
- you will not be entitled to have the notes represented by the global notes
registered in your name;
- you will not receive or be entitled to receive physical delivery of
certificated notes; and
- you will not be considered to be the owner or holder of any notes under
the global notes.
We understand that under existing industry practice, in the event an owner
of a beneficial interest in a global note desires to take any action that the
depositary, as the holder of the global notes, is entitled to take, the
depositary would authorize the participants to take such action. The
participants would authorize beneficial owners owning through them to take the
action or would otherwise act upon the instructions of beneficial owners owning
through them.
Payment of principal of and premium, if any, and interest on notes
represented by a global note registered in the name of and held by the
depositary or its nominee will be made to the depositary or its nominee, as the
registered owner and holder of the global notes.
We expect that the depositary or its nominee, upon receipt of any payment of
principal of, premium, if any, or interest on a global note, will credit
participants' accounts with payments in amounts proportionate to their
respective beneficial interests in the principal amount of the global notes as
shown on the records of the depositary or its nominee. We also expect that
payments by participants to owners of beneficial interests in a global note held
through the participants will be governed by standing instructions and customary
practices and will be the responsibility of the participants. We will not have
any responsibility or liability:
- for any aspect of the records relating to, or payments made on account of,
beneficial ownership interests in the global notes;
- for maintaining, supervising or reviewing any records relating to
beneficial ownership interests;
- for any other aspect of the relationship between the depositary and its
participants; or
- for any other aspect of the relationship between participants and the
owners of beneficial interests in the global notes owning through
participants.
Unless and until the global notes are exchanged in whole or in part for
certificated notes, the global notes may not be transferred except as a whole by
the depositary to a nominee of the depositary or by a nominee of the depositary
to another nominee of the depositary.
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<PAGE>
Although the depositary has agreed to the foregoing procedures in order to
facilitate transfers of interests in the global notes among participants of the
depositary, it is under no obligation to perform or continue to perform these
procedures, and these procedures may be discontinued at any time. Neither we nor
the trustee will have any responsibility for the performance by the depositary
or its participants or indirect participants of their obligations under the
rules and procedures governing their operations.
YEAR 2000 ISSUES RELATING TO DTC
We have been advised by DTC that it is aware that some computer
applications, systems and the like for processing dates that are dependent upon
calendar dates, including dates before, on or after January 1, 2000, may
encounter "year 2000 problems." DTC has informed its participants and other
members of the financial community that it has developed and implemented a
program so that its systems, as the same relate to the timely payment of
distributions, including principal and income payments, to securityholders,
book-entry deliveries and settlement of trades within DTC continue to function
appropriately. This program includes a technical assessment and a remediation
plan, each of which is complete. DTC has not reported any material year 2000
problems.
According to DTC, the foregoing information with respect to DTC has been
provided to the industry for informational purposes only and is not intended to
serve as a representation, warranty or contract modification of any kind.
CERTIFICATED NOTES
The notes represented by the global notes are exchangeable for certificated
notes in definitive form of like tenor in denominations of $1,000 and multiples
of $1,000 if:
- the depositary notifies us that it will not continue as depositary for the
global notes;
- the depositary ceases to be a clearing agency registered under the
Exchange Act or announces an intention permanently to cease business or in
fact ceases business;
- we determine not to have all of the notes represented by the global notes;
or
- an event of default has occurred and is continuing.
Any note that becomes exchangeable may be exchanged for certificated notes
issuable in authorized denominations and registered in whatever names the
depositary directs. Subject to the foregoing, the global notes are not
exchangeable, except for global notes of the same aggregate denomination to be
registered in the name of the depositary or its nominee.
CONVERSION RIGHTS
A holder may, at any time prior to the close of business on the business day
immediately preceding the maturity date, convert a note or any portion of a note
into shares of our common stock initially at the conversion price of $123.00 per
share unless the note or portion of a note has been previously redeemed. The
right to convert a note called for redemption terminates on the earlier of
(1) the close of business on the business day immediately preceding the date
fixed for redemption, also known as the redemption date, unless we default in
making the payment due on the redemption date, and (2) the close of business on
the business day immediately preceding the maturity date of the notes. For
information as to notices of redemption, see "Optional Redemption."
We will adjust the conversion price if:
- we issue common stock as a dividend or distribution on our common stock;
- we issue to all holders of our common stock rights, warrants or options
entitling them to subscribe for or purchase common stock at less than the
current market price;
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<PAGE>
- we subdivide or combine our common stock;
- we distribute to all holders of our common stock evidences of our
indebtedness, shares of capital stock, securities, cash or property,
excluding:
-- any rights, warrants or options referred to above;
-- any dividend or distribution paid exclusively in cash; and
-- any dividend or distribution referred to above;
- we make a cash distribution to all holders of our common stock that,
together with other all-cash distributions and consideration payable in
respect of any tender or exchange offer by us or one of our subsidiaries
for our common stock made within the preceding 12 months exceeds 12.5% of
our aggregate market capitalization on the date of the distribution; and
- we complete a tender or exchange offer for our common stock which involves
an aggregate consideration that, together with (A) any cash and other
consideration payable in respect of any tender or exchange offer by us or
one of our subsidiaries for our common stock concluded within the
preceding 12 months and (B) the amount of any all-cash distributions to
all holders of our common stock made within the preceding 12 months,
exceeds 12.5% of our aggregate market capitalization on the expiration of
the tender or exchange offer.
No adjustment of the conversion price must be made until cumulative adjustments
amount to 1% or more of the conversion price as last adjusted.
If we distribute rights or warrants, other than those referred to in the
second bullet of the preceding paragraph, pro rata to holders of common stock,
so long as the rights or warrants have not expired or been redeemed by us, the
holder of any note surrendered for conversion will be entitled to receive, in
addition to the shares of common stock issuable upon conversion, the following:
- if conversion occurs on or prior to the date for distribution of
certificates evidencing rights or warrants, the holder will be entitled to
the same number of rights or warrants that a holder of a number of shares
of common stock equal to the number of conversion shares is entitled; and
- if conversion occurs after the distribution date, the holder will be
entitled to the same number of rights or warrants that a holder of the
number of shares of common stock into which the note was convertible
immediately prior to the distribution date would have been entitled on the
distribution date, in accordance with the terms and provisions applicable
to the rights or warrants.
The conversion price of the notes will not be subject to adjustment on account
of any declaration, distribution or exercise of any rights or warrants.
If our common stock is converted into the right to receive other securities,
cash or other property as a result of reclassifications, consolidations,
mergers, sales or transfers of assets or other transactions, each note then
outstanding would, without the consent of any holders of notes, become
convertible only into the kind and amount of securities, cash and other property
receivable in the transaction by a holder of the number of shares of common
stock which would have been received by a holder immediately prior to the
transaction if the holder had converted its notes.
We will not issue fractional shares of common stock to a holder who converts
a note. Instead of issuing fractional shares, we will pay a cash adjustment
based upon the market price.
Except as described in this paragraph, no holder of notes will be entitled
upon conversion of the notes to any actual payment or adjustment on account of
accrued and unpaid interest or on account of dividends on shares of common stock
issued in connection with the conversion. If any holder surrenders a note for
conversion between the close of business on any record date for the payment of
an installment of interest and the opening of business on the related interest
payment date, the holder must deliver payment to us of
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<PAGE>
an amount equal to the interest payable on the interest payment date on the
principal amount converted together with the note being surrendered. The
foregoing sentence does not apply to notes called for redemption on a redemption
date within the period between and including the record date and interest
payment date.
If we make a distribution of property to our stockholders which would be
taxable to them as a dividend for federal income tax purposes and the conversion
price of the notes is reduced, this reduction may be deemed to be the receipt of
taxable income to holders of the notes.
In addition, we may decrease the conversion price by any amount for any
period of at least 20 days, if our board of directors determines that that
decrease would be in our best interests. No decrease will be taken into account
for purposes of determining whether the closing price of our common stock
exceeds the conversion price by 105% in connection with an event which otherwise
would be a change in control.
In addition, we may make any reductions in the conversion price that our
board deems advisable to avoid or diminish any income tax to holders of shares
of common stock resulting from any dividend or distribution of stock, or rights
to acquire stock, or from any event treated as a dividend or distribution for
income tax purposes or for any other reason.
OPTIONAL REDEMPTION
At any time on or after October 7, 2002, we may redeem all or a portion of
the notes upon at least 30 and not more than 60 days' notice by mail to the
holders of the notes by paying the redemption price plus accrued and unpaid
interest. The redemption price, expressed as a percentage of the principal
amount, is as follows for the periods shown below:
<TABLE>
<CAPTION>
REDEMPTION
PERIOD PRICE
- ------ ----------
<S> <C>
October 7, 2002 through September 30, 2003.................. 102.50%
October 1, 2003 through September 30, 2004.................. 101.67%
October 1, 2004 through September 30, 2005.................. 100.83%
October 1, 2005 and after................................... 100.00%
</TABLE>
If we opt to redeem less than all of the notes at any time, the trustee will
select or cause to be selected the notes to be redeemed by any method it deems
fair and appropriate. In the event of a partial redemption, the trustee may
provide for selection for redemption of portions of the principal amount of any
note of a denomination larger than $1,000.
There is no sinking fund provision in the notes.
RIGHT TO REQUIRE PURCHASE OF NOTES UPON A CHANGE IN CONTROL
If a change in control occurs, each holder of notes may require that we
purchase the holder's notes on the date fixed by us that is not less than 30 nor
more than 45 days after we give notice of the change in control. We will
purchase the notes for an amount in cash equal to 100% of the principal amount
of the notes on the date of purchase plus accrued and unpaid interest, if any,
to the date of purchase. As described below, we may pay the purchase price in
our common stock.
A change in control occurs when:
- any person or persons acting together in a manner which would constitute a
"group" for purposes of Section 13(d) of the Exchange Act
-- becomes the beneficial owner, directly or indirectly, of our capital
stock, entitling the person or persons and its or their affiliates to
exercise more than 50% of the total voting power of all classes of
our capital stock entitled to vote generally in the election of our
directors or
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<PAGE>
-- succeeds in having enough of its or their nominees elected to our
board so that the nominees, when added to any existing directors
remaining on our board after the election who are affiliates of or
acting in concert with these persons, then constitute a majority of
our board;
- we are a party to any transaction in which our common stock is converted
into the right to receive other securities, cash and/or property, and the
value distributed in the transaction and any other transaction effected
within the 12 preceding months is more than 50% of the average of the
daily closing prices for our common stock for the five consecutive trading
days ending on the trading day immediately preceding the date of the
transaction; or
- we consolidate with or merge into any other person or sell, convey,
transfer or lease our properties and assets substantially as an entirety
to any person other than one of our subsidiaries, or any other person
consolidates with or merges into us, except any consolidation or merger
where persons who are our stockholders immediately prior to the
transaction become the beneficial owners of more than 50% of the total
voting power of the surviving company's capital stock.
On or prior to the purchase date, we will deposit with a paying agent an amount
of money sufficient to pay the aggregate purchase price of the notes which is to
be paid on the purchase date.
At our option, instead of paying the purchase price in cash, we may pay the
purchase price in common stock valued at 95% of the average of the closing sales
prices of our common stock for the five trading days immediately preceding and
including the third day prior to the purchase date. We may only pay the purchase
price in common stock if we satisfy conditions required by the indenture.
We may not purchase any note when the subordination provisions of the
indenture otherwise would prohibit us from making payments of principal in
respect of the notes. Failure to purchase the notes when required under the
preceding paragraphs will constitute an event of default under the indenture
whether or not the purchase is permitted by the subordination provisions of the
indenture.
A change in control will not be deemed to have occurred:
- if the closing price of our common stock for any five trading days during
the ten trading days immediately preceding the change in control is at
least equal to 105% of the conversion price in effect immediately
preceding the change in control; or
- if at least 90% of the consideration received or to be received by the
holders of our common stock in the transaction or transactions
constituting a change in control consists of:
-- shares of common stock of an entity organized under the laws of a
U.S. jurisdiction whose shares of common stock are, or upon issuance
will be, traded on a national securities exchange in the U.S. or
through the Nasdaq Stock Market or
-- shares of common stock of an entity organized under the laws of a
jurisdiction outside of the U.S., or American Depositary Shares
representing shares of common stock, that are, or upon issuance will
be, traded on a national securities exchange in the U.S. or through
the Nasdaq Stock Market if the entity has a worldwide total market
capitalization of its equity securities of at least US$5 billion
before giving effect to the transaction or transactions constituting
a change in control.
On or before the 15th day after we know or reasonably should know a change
in control has occurred, we must mail to all holders of record of the notes a
notice of the occurrence of the change in control, stating:
- the purchase date;
- the date by which the purchase right must be exercised;
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<PAGE>
- the purchase price for the notes; and
- the procedures which a holder of notes must follow to exercise the
purchase right.
To exercise the purchase right, the holder of a note must deliver, on or
before the 30th day after the date of our notice, an irrevocable written notice
to us and the trustee of the holder's exercise of the right. This notice must be
accompanied by the certificates evidencing the note or notes with respect to
which the right is being exercised, duly endorsed for transfer. In addition, if
the purchase date falls between the relevant record date and the succeeding
interest payment date, the holder will also be required to deliver with the
notes to be purchased a payment in cash equal to the interest that the holder is
to receive on the interest payment date.
The effect of these provisions granting the holders the right to require us
to purchase the notes upon the occurrence of a change in control may make it
more difficult for any person or group to acquire control of us or to effect a
business combination with us. Moreover, under the indenture, we will not be
permitted to pay principal of or interest on, or otherwise acquire the notes,
including any purchase at the election of the holders of notes upon the
occurrence of a change in control, if a payment default on senior indebtedness
has occurred and is continuing, or in the event of our insolvency, bankruptcy,
reorganization, dissolution or other winding up where senior indebtedness is not
paid in full. Our ability to pay cash to holders of notes following the
occurrence of a change in control may be limited by our then existing financial
resources. We cannot assure you that sufficient funds will be available when
necessary to make any required purchases. See "Risk Factors--We may be unable to
purchase the notes."
If a change in control occurs and the holders exercise their rights to
require us to purchase notes, we intend to comply with applicable tender offer
rules under the Exchange Act with respect to any purchase.
The term "beneficial owner" will be determined in accordance with
Rules 13d-3 and 13d-5 of the Exchange Act, except that a person shall be deemed
to have "beneficial ownership" of all shares that the person has the right to
acquire, whether exercisable immediately or only after the passage of time.
REGISTRATION RIGHTS
We have entered into a registration rights agreement with the initial
purchasers of the notes. Under this agreement, we must use our commercially
reasonable best efforts to keep the shelf registration statement of which this
prospectus forms a part effective until the earliest of:
- the time when the notes covered by the shelf registration statement can be
sold under Rule 144 of the Securities Act;
- two years from the date the shelf registration statement is declared
effective; and
- the date on which all the notes registered under the shelf registration
statement are disposed of in accordance with the shelf registration
statement.
We have the right to suspend use of the shelf registration statement for up
to 90 days. A holder who elects to sell any securities pursuant to the shelf
registration statement:
- will be required to be named as selling security holder;
- will be required to deliver a prospectus to purchasers;
- will be subject to the civil liability provisions under the Securities Act
in connection with any sales; and
- will be bound by the provisions of the registration rights agreement which
are applicable, including indemnification obligations.
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<PAGE>
If, after the shelf registration statement has been declared effective, we
fail to keep the shelf registration statement effective or usable in accordance
with and during the periods specified in the registration rights agreement, then
the interest rate on the notes will increase by 0.5% per year until the failure
is cured. This requirement is subject to exceptions described in the
registration rights agreement, including our right to suspend the use of the
shelf registration statement for up to 90 days.
We will have no other liabilities for monetary damages with respect to our
registration obligations, except that if we breach, fail to comply with or
violate provisions of the registration rights agreement, the holders of the
notes will be entitled to equitable relief, including injunction and specific
performance. We may not oppose the granting of this equitable relief.
CONSOLIDATION, MERGER AND SALE OF ASSETS
We may, without the consent of the holders of any of the notes, consolidate
with or merge into any other person or convey, transfer or lease our properties
substantially as an entirety to, any other person, if:
- the successor, transferee or lessee expressly assumes our obligations
under the indenture and the notes by means of a supplemental indenture
entered into with the trustee;
- after giving effect to the transaction, no event of default and no event
which, with notice or lapse of time, or both, would constitute an event of
default, will have occurred and be continuing;
- the successor company is organized
-- under the laws of any U.S. jurisdiction or
-- under the laws of a jurisdiction outside the U.S. and has (1) common
stock or American Depositary Shares representing the common stock traded
on a national securities exchange in the U.S. or through the Nasdaq Stock
Market and (2) a worldwide total market capitalization of its equity
securities before giving effect to the consolidation or merger of at
least US$5 billion; and
- other conditions specified in the indenture are met.
Under any consolidation, merger or any conveyance, transfer or lease of our
properties and assets as described in the preceding paragraph, the successor
company will be our successor and will succeed to, and be substituted for, and
may exercise every right and power of, Affymetrix under the indenture. Except in
the case of a lease, if the predecessor is still in existence after the
transaction, it will be released from its obligations and covenants under the
indenture and the notes.
EVENTS OF DEFAULT
Each of the following is an event of default:
- a default in the payment of any interest upon any of the notes when due
and payable, continued for 30 days, whether or not payment is prohibited
by the subordination provisions of the indenture;
- a default in the payment of the principal of and premium, if any, on any
of the notes when due, including on a redemption date, whether or not
payment is prohibited by the subordination provisions of the indenture;
- a default in our obligation to provide notice of a change in control or
default in the payment of the purchase price in respect of any note on the
purchase date, whether or not payment is prohibited by the subordination
provisions of the indenture;
- a default by us in the performance, or breach, of any of our other
covenants in the indenture which are not remedied by the end of a period
of 60 days after written notice to us by the trustee or to us and the
trustee by the holders of at least 25% in principal amount of the
outstanding notes;
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<PAGE>
- failure to pay when due the principal of, or acceleration of, any
indebtedness for money borrowed by us in excess of $10 million, if such
indebtedness is not discharged, or the acceleration is not waived or
annulled, by the end of a period of 30 days after written notice to us by
the trustee or to us and the trustee by the holders of at least 25% of
principal amount of outstanding notes; or
- events of bankruptcy, insolvency or reorganization involving us.
If an event of default, other than of a type referred to in the last bullet
of the preceding paragraph, occurs and is continuing, either the trustee or the
holders of at least 25% in principal amount of the outstanding notes may declare
the principal amount of and accrued interest on all notes to be immediately due
and payable. This declaration may be rescinded if conditions described in the
indenture are satisfied. If an event of default of the type referred to in the
last bullet of the preceding paragraph occurs, the principal amount of and
accrued interest on the outstanding notes shall automatically become immediately
due and payable.
The holders of not less than a majority in principal amount of the
outstanding notes may direct the time, method and place of conducting any
proceedings for any remedy available to the trustee, or exercising any trust or
power conferred on the trustee; provided that the direction does not conflict
with any rule of law or with the indenture. The trustee may take any other
action deemed proper by the trustee which is not inconsistent with the
direction.
Subject to the provisions of the indenture relating to the duties of the
trustee, if an event of default occurs and is continuing, the trustee will be
under no obligation to exercise any of the rights or powers under the indenture
at the request or direction of any of the holders of the notes unless those
holders have offered to the trustee reasonable indemnity or security against any
loss, liability or expense. Except to enforce the right to receive payment of
principal, premium, if any, or interest when due or the right to convert a note
in accordance with the indenture, no holder may institute any proceeding or
pursue any remedy with respect to the indenture or the notes unless:
- the holder has previously given the trustee notice that an event of
default is continuing;
- holders of at least 25% in principal amount of the outstanding notes have
requested the trustee to pursue the remedy;
- the holders have offered the trustee security or indemnity satisfactory to
the trustee against any loss, liability or expense;
- the trustee has not complied with the request within 60 days after the
receipt and the offer of security or indemnity; and
- the holders of a majority in principal amount of the outstanding notes
have not given the trustee a direction inconsistent with the request
within the 60-day period.
In addition, we are required to deliver to the trustee, within 120 days
after the end of each fiscal year, a certificate indicating whether the officers
signing the certificate know of any default by us in the performance or
observance of any of the terms of the indenture. If the officers know of a
default, the certificate must specify the status and nature of all defaults.
MODIFICATION AND WAIVER
We and the trustee may enter into supplemental indentures that add, change
or eliminate provisions of the indenture or modify the rights of the holders of
the notes with the consent of the holders of at least a majority in principal
amount of the notes then outstanding. However, without the consent of each
holder, no supplemental indenture may:
- change the stated maturity of the principal of or any installment of
interest on any note;
20
<PAGE>
- reduce the principal amount of, or the premium or rate of interest on, any
note;
- adversely affect the right of any holder to convert any note as provided
in the indenture;
- change the place of payment where, or the coin of currency in which, the
principal of any note or any premium or interest is payable;
- impair the right to institute suit for the enforcement of any payment on
or with respect to any note on or after the stated maturity, or, in the
case of redemption, on or after the redemption date;
- modify the subordination provisions of the indenture in a manner adverse
to the holders of the notes;
- modify the redemption provisions of the indenture in a manner adverse to
the holders of the notes;
- modify the provisions of the indenture relating to our requirement to
offer to purchase notes upon a change in control in a manner adverse to
the holders of the notes;
- reduce the percentage in principal amount of the outstanding notes the
consent of whose holders is required for any modification or amendment of
the indenture or for any waiver of compliance with certain provisions of
or defaults under the indenture; or
- modify the foregoing requirements.
Without the consent of any holders of notes, we and the trustee may enter
into supplemental indentures for any of the following purposes:
- to evidence a successor to us and the assumption by that successor of our
obligations under the indenture and the notes;
- to add to our covenants for the benefit of the holders of the notes or to
surrender any right or power conferred to us;
- to secure our obligations in respect of the notes;
- to make provision with respect to the conversion rights of holders of the
notes under the indenture;
- to make any changes or modifications to the indenture necessary in
connection with the registration of the notes under the Securities Act as
contemplated by the indenture;
- to cure any ambiguity or inconsistency in the indenture;
- to comply with any requirement in connection with the qualification of the
indenture under the Trust Indenture Act; or
- to make any other provisions with respect to matters or questions arising
under the indenture which are not inconsistent with the provisions of the
indenture.
However, no supplemental indenture entered into pursuant to the fifth, sixth,
seventh, and eighth bullets of the preceding paragraph may adversely affect the
interests of the holders of the notes.
The holders of a majority in principal amount of the outstanding notes may,
on behalf of the holders of all notes:
- waive compliance by us with restrictive provisions of the indenture, as
detailed in the indenture.
- waive any past default under the indenture and its consequences, except a
default in the payment of the principal of or any premium or interest on
any note or in respect of a provision which under the indenture cannot be
modified or amended without the consent of the holder of each outstanding
note affected.
21
<PAGE>
SUBORDINATION
The payment of the principal of and premium, if any, and interest on the
notes will, to the extent described in the indenture, be subordinated in right
of payment to the prior payment in full of all senior indebtedness. The holders
of all senior indebtedness will first be entitled to receive payment in full of
all amounts due or to become due on the senior indebtedness, or provision for
such payment in money or money's worth, before the holders of the notes will be
entitled to receive any payment in respect of the notes. No payments on account
of the notes or on account of the purchase or acquisition of notes may be made
if a default in any payment with respect to senior indebtedness has occurred and
is continuing or if any judicial proceeding is pending with respect to any such
default.
By reason of such subordination, in the event of insolvency, our creditors
who are not holders of senior indebtedness, including holders of the notes, may
recover less, ratably, than holders of our senior indebtedness.
At September 30, 1999, senior indebtedness was approximately $327,000, all
of which was secured. We expect from time to time to incur additional
indebtedness. The indenture does not limit or prohibit us from incurring
additional senior indebtedness or additional indebtedness.
DEFEASANCE
Upon satisfaction of the requirements described below, we may terminate all
of our obligations under the notes and the indenture, known as legal defeasance,
other than our obligation:
- to maintain a registrar and paying agents and hold moneys for payment in
trust;
- to register the transfer or exchange of the notes;
- to replace mutilated, destroyed, lost or stolen notes;
- to provide for conversion of the notes;
- to comply with the registration rights agreement; and
- to purchase the notes in the event of a change in control.
In addition, we may terminate our obligations to comply with restrictive
covenants relating to the maintenance of our properties and payment of taxes and
other claims and the operation of the cross default and cross acceleration
provisions. This termination is known as covenant defeasance.
We may exercise our legal defeasance option even if we have previously
exercised our covenant defeasance option. If we exercise either defeasance
option, payment of the notes may not be accelerated because of the occurrence of
events of default.
To exercise either defeasance option, we must irrevocably deposit in trust
with the trustee money and/ or obligations backed by the full faith and credit
of the U.S. that will provide money in an amount sufficient in the written
opinion of a nationally recognized firm of independent public accountants to pay
the principal of, premium, if any, and each installment of interest on the
outstanding notes. We may only establish this trust if, among other things:
- no event of default, or event that with the passing of time or the giving
of notice, or both, would constitute an event of default, shall have
occurred or be continuing;
- we have delivered to the trustee an opinion of counsel to the effect that
the deposit shall not cause the trust so created to be subject to the
Investment Company Act of 1940;
- in the case of legal defeasance, we have delivered to the trustee an
opinion of counsel to the effect that we have received from, or there has
been published by, the Internal Revenue Service a ruling or there has been
a change in law, which in the opinion of our counsel, provides that
holders of the
22
<PAGE>
notes will not recognize gain or loss for federal income tax purposes as a
result of the action and will be subject to federal income tax on the same
amount, in the same manner and at the same times as would have been the
case if the action had not occurred;
- in the case of covenant defeasance, we have delivered to the trustee an
opinion of counsel to the effect that the holders of the notes will not
recognize gain or loss for federal income tax purposes as a result of the
action and will be subject to federal income tax on the same amount, in
the same manner and at the same times as would have been the case if the
action had not occurred; and
- we satisfy other customary conditions precedent described in the
indenture.
REGARDING THE TRUSTEE
The Bank of New York is the trustee under the indenture.
GOVERNING LAW
The indenture and the notes will be governed by and construed in accordance
with the laws of the State of New York without regard to conflict of laws
principles.
23
<PAGE>
U.S. FEDERAL TAX CONSIDERATIONS
The following is a general discussion of the material U.S. federal income
tax considerations relevant to purchasing, owning and disposing of the notes and
the common stock into which you may convert the notes. This discussion is based
on currently existing provisions of the Internal Revenue Code of 1986, existing
and proposed Treasury regulations promulgated under the Code and administrative
and judicial interpretations, all as presently in effect or proposed and all of
which are subject to change, possibly with retroactive effect or different
interpretations.
This discussion does not deal with all aspects of U.S. federal income
taxation that may be important to holders of the notes or shares of common stock
received upon conversion, and it does not include any description of the tax
laws of any state, local or foreign government. This discussion is limited to
beneficial owners who hold the notes and the shares of common stock received
upon conversion as capital assets within the meaning of Section 1221 of the
Code. Moreover, this discussion is for general information only and does not
address all of the U.S. federal income tax consequences that may be relevant to
particular purchasers. Particular purchasers may be subject to special rules.
For the purpose of this discussion, a "U.S. holder" refers to a beneficial
owner of a note or common stock who or which is:
- a citizen or resident of the U.S. for U.S. federal income tax purposes;
- a corporation, partnership or other entity created or organized in or
under the laws of the U.S. or political subdivision of the U.S., unless
otherwise provided in provisions in the case of a partnership;
- an estate the income of which is subject to U.S. federal income taxation
regardless of its source;
- a trust, if a U.S. court is able to exercise primary supervision over the
administration of the trust and one or more U.S. fiduciaries have
authority to control all substantial decisions of the trust; or
- otherwise subject to U.S. federal income tax on a net income basis in
respect of its worldwide taxable income.
The term "non-U.S. holder" refers to any beneficial owner of a note or
common stock who or which is not a U.S. holder.
PROSPECTIVE PURCHASERS ARE URGED TO CONSULT THEIR OWN TAX ADVISORS AS TO THE
PARTICULAR FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES TO THEM OF THE
ACQUISITION, OWNERSHIP AND DISPOSITION OF THE NOTES, INCLUDING THE CONVERSION OF
THE NOTES INTO SHARES OF COMMON STOCK, AND THE EFFECT THAT THEIR PARTICULAR
CIRCUMSTANCES MAY HAVE ON THESE TAX CONSEQUENCES.
FEDERAL TAX CONSIDERATIONS APPLICABLE TO U.S. HOLDERS
INTEREST ON NOTES. Interest paid on the notes will be taxable to a U.S.
holder as ordinary interest income in accordance with the holder's method of tax
accounting. The notes were not issued with original issue discount within the
meaning of the Code.
CONSTRUCTIVE DIVIDEND. Some corporate transactions, such as distributions
of assets to holders of common stock, may cause a deemed distribution to the
holders of the notes if the conversion price or conversion ratio of the notes is
adjusted to reflect the corporate transaction. These distributions will be
taxable as a dividend, return of capital or capital gain in accordance with the
earnings and profits rules discussed under "--Dividends on Shares of Common
Stock."
CONVERSION OF NOTES. A U.S. holder of notes generally will not recognize
gain or loss on the conversion of the notes solely into shares of common stock,
other than cash received in lieu of fractional shares. The U.S. holder's tax
basis in the shares of common stock received upon conversion of the notes will
be equal to the holder's aggregate tax basis in the notes converted, less any
portion allocable to cash
24
<PAGE>
received in lieu of a fractional share. The holding period of the shares of
common stock received by the holder upon conversion of notes generally will
include the period during which the holder held the notes prior to the
conversion.
Cash received in lieu of a fractional share of common stock should be
treated as a payment in exchange for such fractional share rather than as a
dividend. Gain or loss recognized on the receipt of cash paid in lieu of
fractional shares generally will equal the difference between the amount of cash
received and the amount of tax basis allocable to the fractional share
exchanged.
DIVIDENDS ON SHARES OF COMMON STOCK. Distributions on shares of common
stock will constitute dividends for U.S. federal income tax purposes to the
extent of our current or accumulated earnings and profits as determined under
U.S. federal income tax principles. Dividends paid to holders that are U.S.
corporations may qualify for the dividends-received deduction.
To the extent that a U.S. holder receives a distribution on shares of common
stock that would otherwise constitute dividends for U.S. federal income tax
purposes but that exceed our current and accumulated earnings and profits, the
distribution will be treated first as a non-taxable return of capital reducing
the holder's basis in the shares of common stock. Any distribution in excess of
the holder's basis in the shares of common stock will be treated as capital
gain.
SALE OR EXCHANGE OF NOTES OR SHARES OF COMMON STOCK. In general, a U.S.
holder of notes will recognize gain or loss upon the sale, redemption,
retirement or other disposition of the notes measured by the difference between:
- the amount of cash and the fair market value of any property received,
except to the extent attributable to the payment of accrued interest, and
- the U.S. holder's tax basis in the notes.
A U.S. holder's tax basis in notes generally will equal the cost of the
notes to the holder. In general, each U.S. holder of common stock into which the
notes have been converted will recognize gain or loss upon the sale, exchange,
redemption, or other disposition of the common stock under rules similar to
those applicable to the notes. Special rules may apply to redemptions of the
common stock which may result in the amount paid being treated as a dividend.
Gain or loss on the disposition of the notes or shares of common stock will be
capital gain or loss and will be long-term capital gain or loss if the holding
period of the notes or the common stock that was disposed of exceeded one year.
Net capital gain realized by individual taxpayers is taxable at a maximum rate
of 20%.
FEDERAL TAX CONSIDERATIONS APPLICABLE TO NON-U.S. HOLDERS
INTEREST ON NOTES. Generally, interest paid on the notes to a non-U.S.
holder will not be subject to U.S. federal income tax if:
- the interest is not effectively connected with the conduct of a trade or
business within the U.S. by the non-U.S. holder;
- the non-U.S. holder does not actually or constructively own 10% or more of
the total voting power of all classes of our stock entitled to vote and is
not a controlled foreign corporation with respect to which we are a
"related person" within the meaning of the Code; and
- the beneficial owner, under penalty of perjury, certifies that the owner
is not a U.S. person and provides the owner's name and address.
The certification described in the last clause above may be provided by a
securities clearing organization, a bank or other financial institution that
holds customers' securities in the ordinary course of its trade or business.
Under recently adopted U.S. Treasury regulations, which generally are effective
for payments made after December 31, 2000, the certification may also be
provided by a qualified intermediary on
25
<PAGE>
behalf of one or more beneficial owners, or other intermediaries, provided that
the intermediary has entered into a withholding agreement with the Internal
Revenue Service and other conditions are met. A holder that is not exempt from
tax under these rules will be subject to U.S. federal income tax withholding at
a rate of 30% unless the interest is effectively connected with the conduct of a
U.S. trade or business, in which case the interest will be subject to the U.S.
federal income tax on net income that applies to U.S. persons generally.
Corporate non-U.S. holders that receive interest income that is effectively
connected with the conduct of a trade or business within the U.S. may also be
subject to an additional "branch profits" tax on such income. Non-U.S. holders
should consult applicable income tax treaties, which may provide different
rules.
CONVERSION OF NOTES. A non-U.S. holder generally will not be subject to
U.S. federal income tax on the conversion of a note into shares of common stock.
To the extent a non-U.S. holder receives cash in lieu of a fractional share on
conversion, such cash may give rise to gain that would be subject to the
rules described below with respect to the sale or exchange of a note or common
stock.
DIVIDENDS ON SHARES OF COMMON STOCK. Generally, any distribution on shares
of common stock to a non-U.S. holder will be subject to U.S. federal income tax
withholding at a rate of 30% unless the dividend is effectively connected with
the conduct of a trade or business within the U.S. by the non-U.S. holder, in
which case the dividend will be subject to the U.S. federal income tax on net
income that applies to U.S. persons generally. Corporate non-U.S. holders that
receive dividend income that is effectively connected with the conduct of a
trade or business within the U.S. also may be subject to an additional "branch
profits" tax on such income. Non-U.S. holders should consult any applicable
income tax treaties, which may provide different rules. A non-U.S. holder and
any entities, partners, shareholders or other beneficiaries of non-U.S. holders
may be required to satisfy certification requirements in order to claim a
reduction of or exemption from withholding under the foregoing rules.
SALES OR EXCHANGE OF NOTES OR SHARES OF COMMON STOCK. A non-U.S. holder
generally will not be subject to U.S. federal income tax on gain recognized upon
the sale or other disposition of the notes or shares of common stock unless:
- the gain is, or is treated as, effectively connected with the conduct of a
trade or business within the U.S. by the non-U.S. holder; or
- in the case of a non-U.S. holder who is a nonresident alien individual and
holds the common stock as a capital asset, such holder is present in the
U.S. for 183 or more days in the taxable year.
FEDERAL ESTATE TAXES. A note beneficially owned by an individual who is a
non-U.S. holder at the time of his or her death generally will not be subject to
U.S. federal estate tax as a result of such individual's death, provided that:
- the individual does not actually or constructively own 10% or more of the
total combined voting power of all classes of our stock entitled to vote
within the meaning of section 871(h)(3) of the Code; and
- interest payments with respect to such note would not have been, if
received at the time of the individual's death, effectively connected with
the conduct of a U.S. trade or business by the individual.
Common stock owned or treated as owned by an individual who is a non-U.S.
holder at the time of his or her death will be included in such individual's
estate for U.S. federal estate tax purposes and thus will be subject to U.S.
federal estate tax, unless an applicable estate tax treaty provides otherwise.
26
<PAGE>
INFORMATION REPORTING AND BACKUP WITHHOLDING
UNITED STATES HOLDERS. Information reporting and backup withholding may
apply to payments of interest or dividends on or the proceeds of the sale or
other disposition of the notes or shares of common stock made by us with respect
to non-corporate U.S. holders. These holders generally will be subject to backup
withholding at a rate of 31% unless the recipient of the payment supplies a
taxpayer identification number and other information, certified under penalties
of perjury, or otherwise establishes, in the manner prescribed by law, an
exemption from backup withholding. Any amount withheld under backup withholding
is allowable as a credit against the U.S. holder's federal income tax, upon
furnishing the required information to the Internal Revenue Service.
NON-UNITED STATES HOLDERS. Generally, information reporting and backup
withholding of U.S. federal income tax at a rate of 31% may apply to payment of
principal, interest and premium, if any, to non-U.S. holders if the holder fails
to certify that the holder is a non-U.S. person or if we or our paying agent has
actual knowledge that the holder is a U.S. person.
The payment of the proceeds on the disposition of notes or shares of common
stock to or through the U.S. office of a U.S. or foreign broker will be subject
to information reporting and backup withholding unless the owner provides the
certification described above or otherwise establishes an exemption. The
proceeds of the disposition by a non-U.S. holder of notes or shares of common
stock to or through a foreign office of a broker will not be subject to backup
withholding. However, if the broker is a U.S. person, a controlled foreign
corporation for U.S. tax purposes, or a foreign person 50% or more of whose
gross income from all sources is from activities that are effectively connected
with a U.S. trade or business, information reporting will apply unless:
- the broker has documentary evidence in its files of the owner's foreign
status; or
- the owner otherwise establishes an exemption.
Both backup withholding and information reporting will apply to the proceeds
from dispositions if the broker has actual knowledge that the holder is a U.S.
holder.
Recently adopted U.S. Treasury regulations, which generally are effective
for payments made after December 31, 2000, alter the rules described above.
Among other things, these regulations provide presumptions under which a
non-U.S. holder is subject to information reporting and backup withholding at
the rate of 31% unless we receive certification from the holder of non-U.S.
status. Depending on the circumstances, this certification will need to be
provided:
- directly by the non-U.S. holder;
- in the case of a non-U.S. holder that is treated as a partnership or other
fiscally transparent entity, by the partners, shareholders or other
beneficiaries of the entity; or
- qualified financial institutions or other qualified entities on behalf of
the non-U.S. holder.
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<PAGE>
SELLING SECURITY HOLDERS
The notes were originally issued by us and sold by the initial purchasers in
a transaction exempt from the registration requirements of the Securities Act to
persons reasonably believed by the initial purchasers to be qualified
institutional buyers or other institutional accredited investors. Selling
holders, including their transferees, pledgees or donees or their successors,
may from time to time offer and sell any or all of the notes and common stock
into which the notes are convertible.
The following table shows information with respect to the selling holders
and the principal amounts of notes and common stock they beneficially own that
may be offered under this prospectus. The information is based on information
provided by or on behalf of the selling holders. The selling holders may offer
all, some or none of the notes or common stock into which the notes are
convertible. Because the selling holders may offer all or some portion of the
notes or the common stock, no estimate can be given as to the amount of the
notes or the common stock that will be held by the selling holders upon
termination of any sales. The column showing ownership after completion of the
offering assumes that the selling holders will sell all of the securities
offered by this prospectus. In addition, the selling holders identified below
may have sold, transferred or otherwise disposed of all or a portion of their
notes since the date on which they provided the information regarding their
notes in transactions exempt from the registration requirements of the
Securities Act.
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT COMMON STOCK COMMON STOCK
OF NOTES ISSUABLE UPON OWNED AFTER
BENEFICIALLY OWNED CONVERSION OF COMMON STOCK COMPLETION OF
NAME AND OFFERED(1) THE NOTES(1) OFFERED(1) THE OFFERING
- ---- ------------------ ------------- ------------- -------------
<S> <C> <C> <C> <C>
AAM/Zazove Institutional Investment
Fund.................................. $1,500,000 12,196 12,196 --
AIG National Union Fire Insurance....... 725,000 5,894 5,894 --
AIG SoundShore Holdings Ltd............. 1,000,000 8,130 8,130 --
Alexandra Global Investment Fund Ltd.... 1,000,000 8,130 8,130 --
Aloha Airlines Non-Pilots Pension
Fund.................................. 90,000 731 731 --
Aloha Airlines Pilots Retirement
Trust................................. 50,000 406 406 --
American Century Heritage Fund.......... 2,000,000 16,260 16,260
Angelo, Gordon & Co., L.P............... 100,000 813 813 --
Argent Classic Convertible Arbitrage
Fund (Bermuda) L.P.................... 4,000,000 35,520 35,520 --
Argent Classic Convertible Arbitrage
Fund L.P.............................. 1,000,000 8,130 8,130 --
Associated Electric & Gas Insurance
Services Limited...................... 400,000 3,252 3,252 --
BBT Fund, L.P........................... 15,000,000 121,951 121,951 --
BNP Arbitrage SNC....................... 5,250,000 42,683 42,683 8,700
Boulder II Limited...................... 2,200,000 17,886 17,886 --
Boulder Capital Inc..................... 400,000 3,252 3,252 --
California Public Employees' Retirement
System................................ 4,000,000 35,520 35,520 --
C&H Sugar Company, Inc.................. 145,000 1,178 1,178 --
Chrysler Corporation Master Retirement
Trust................................. 2,415,000 19,634 19,634 --
The Class IC Company, Ltd............... 1,000,000 8,130 8,130 --
Delaware PERS........................... 1,525,000 12,398 12,398 --
Deutsche Bank Securities Inc............ 6,900,000 56,097 56,097 --
Employee Benefit Convertible Securities
Fund.................................. 300,000 2,439 2,439 --
Fidelity Financial Trust................ 3,000,000 24,390 24,390 --
Fiduciary Trust Company International... 500,000 4,065 4,065 --
Forrestal Funding Master Trust.......... 5,000,000 40,650 40,650 --
GLG Global Convertible Fund............. 1,720,000 13,983 13,983
GLG Global Convertible Units Fund....... 280,000 2,276 2,276
GLG Market Neutral Fund................. 3,100,000 25,203 25,203
</TABLE>
28
<PAGE>
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT COMMON STOCK COMMON STOCK
OF NOTES ISSUABLE UPON OWNED AFTER
BENEFICIALLY OWNED CONVERSION OF COMMON STOCK COMPLETION OF
NAME AND OFFERED(1) THE NOTES(1) OFFERED(1) THE OFFERING
- ---- ------------------ ------------- ------------- -------------
<S> <C> <C> <C> <C>
Global Bermuda Limited Partnership...... 1,000,000 8,130 8,130 6,475
Hawaiian Airlines Employees Pension
Plan.................................. 80,000 650 650 --
Hawaiian Airlines Pension Plan for
Salaried Employees.................... 20,000 162 162 --
Hawaiian Airlines Pilots Retirement
Plan.................................. 125,000 1,016 1,016 --
Highbridge Capital Corporation.......... 7,000,000 56,910 56,910 --
ICI American Holdings Trust............. 630,000 5,235 5,235 --
JMG Capital Partners, LP................ 1,000,000 8,130 8,130 --
JMG Triton Offshore Fund, Ltd........... 1,000,000 8,130 8,130 --
Island Holdings......................... 10,000 81 81 --
Lakeshore International, Ltd............ 2,000,000 16,260 16,260 13,025
Lipper Convertibles, L.P................ 6,500,000 52,845 52,845 --
Lipper Convertibles Series II, L.P...... 1,000,000 8,130 8,130 --
Lipper Offshore Convertibles, L.P....... 2,500,000 20,325 20,325 --
Michael Angelo, L.P..................... 1,100,000 8,943 8,943 --
Motion Picture Industry Health Plan--
Active Member Fund.................... 280,000 2,276 2,276 --
Motion Picture Industry Health Plan--
Retiree Member Fund................... 145,000 1,178 1,178 --
Nalco Chemical Retirement............... 325,000 2,439 2,439 --
Nations Capital Income Fund............. 4,000,000 32,520 32,520 --
OCM Convertible Trust................... 1,300,000 10,569 10,569 --
Onex Industrial Partners Ltd............ 400,000 3,252 3,252 --
Pacific Innovations Trust Capital Income
Fund.................................. 300,000 2,439 2,439 --
Pacific Life Insurance Company.......... 1,000,000 8,130 8,130
Partner Reinsurance Company Ltd......... 495,000 4,024 4,024 --
Queen's Health Plan..................... 30,000 243 243 --
Ramius, L.P............................. 1,400,000 11,382 11,382 --
Ramius Securities, LLC.................. 350,000 2,845 2,845 --
Raphael, L.P............................ 350,000 2,845 2,845 --
RCG Baldwin, L.P........................ 700,000 5,691 5,691 --
RCG Multi-Strategy Account, L.P......... 1,750,000 14,227 14,227 --
Robertson Stephens...................... 5,000,000 40,650 40,650 --
San Diego County Employees Retirement
Assoc................................. 2,000,000 16,260 16,260 --
SG Cowen Securities Corporation......... 2,000,000 16,260 16,260 --
Starvest Combined Portfolio............. 950,000 7,723 7,723 --
State Employees' Retirement Fund of the
State of Delaware..................... 1,275,000 10,365 10,365 --
State of Connecticut Combined Investment
Funds................................. 2,940,000 23,902 23,902 --
State of Oregon Equity.................. 4,280,000 34,796 34,796 --
The TCW Group, Inc...................... 14,395,000 117,032 117,032 --
Triarc Companies Inc.................... 350,000 2,845 2,845 --
Tribeca Investments LLC................. 14,000,000 113,821 113,821 --
Value Line Convertible Fund, Inc........ 1,000,000 8,130 8,130 --
Vanguard Convertible Securities
Fund, Inc............................. 1,650,000 13,414 13,414 --
Zazove Income Fund, L.P................. 2,000,000 16,260 16,260 --
Zeneca Holdings Trust................... 625,000 5,081 5,081 --
</TABLE>
- --------------------------
(1) Amounts indicated may be in excess of the total amount registered due to
sales or transfers exempt from the registration requirements of the
Securities Act since the date upon which selling holders provided
information to us regarding their notes.
29
<PAGE>
None of the selling holders nor any of their affiliates, officers, directors
or principal equity holders has held any position or office or has had any
material relationship with us within the past three years, except that Robertson
Stephens was an initial purchaser in connection with the offer and sale of the
notes in September 1999.
Information concerning the selling holders may change from time to time and
any changed information will be set forth in supplements to this prospectus if
and when necessary. In addition, the per share conversion price and, therefore,
the number of shares of common stock issuable upon conversion of the notes, is
subject to adjustment. As a result, the aggregate principal amount of notes and
the number of shares of common stock into which the notes are convertible may
increase or decrease.
30
<PAGE>
PLAN OF DISTRIBUTION
The selling holders and their successors, including their transferees,
pledgees or donees or their successors, may sell the notes and the common stock
into which the notes are convertible directly to purchasers or through
underwriters, broker-dealers or agents, who may receive compensation in the form
of discounts, concessions or commissions from the selling holders or the
purchasers. These discounts, concessions or commissions as to any particular
underwriter, broker-dealer or agent may be in excess of those customary in the
types of transactions involved.
The notes and the common stock into which the notes are convertible may be
sold in one or more transactions at fixed prices, at prevailing market prices at
the time of sale, at prices related to the prevailing market prices, at varying
prices determined at the time of sale, or at negotiated prices. These sales may
be effected in transactions:
- on any national securities exchange or quotation service on which the
notes or the common stock may be listed or quoted at the time of sale;
- in the over-the-counter market;
- in transactions otherwise than on these exchanges or services or in the
over-the-counter market;
- through the writing of options, whether listed on an options exchange or
otherwise;
- through the settlement of short sales;
- through the distribution by a holder to its partners, members or
stockholders; or
- through a combination of any of the above, which may involve crosses or
block transactions.
In connection with the sale of the notes and the common stock into which the
notes are convertible or otherwise, the selling holders may enter into hedging
transactions with broker-dealers or other financial institutions, which may in
turn engage in short sales of the notes or the common stock into which the notes
are convertible and deliver these securities to close out those short positions,
or loan or pledge the notes or the common stock into which the notes are
convertible to broker-dealers that in turn may sell these securities.
The aggregate proceeds to the selling holders from the sale of the notes or
common stock into which the notes are convertible will be the purchase price of
the notes or common stock less discounts and commissions, if any. Each of the
selling holders reserves the right to accept and, together with their agents
from time to time, to reject, in whole or in part, any proposed purchase of
notes or common stock to be made directly or through agents. We will not receive
any of the proceeds from this offering.
Our outstanding common stock is listed for quotation on the Nasdaq National
Market. We do not intend to list the notes for trading on any national
securities exchange or on the Nasdaq National Market and can give no assurance
about the development of any trading market for the notes. If a trading market
for the notes fails to develop, the trading price of the notes may decline.
In order to comply with the securities laws of some states, if applicable,
the notes and common stock into which the notes are convertible may be sold in
these jurisdictions only through registered or licensed brokers or dealers. In
addition, in some states the notes and common stock into which the notes are
convertible may not be sold unless they have been registered or qualified for
sale or an exemption from registration or qualification requirements is
available and is complied with.
The selling holders and any underwriters, broker-dealers or agents that
participate in the sale of the notes and common stock into which the notes are
convertible may be "underwriters" within the meaning of Section 2(11) of the
Securities Act. Any discounts, commissions, concessions or profit they earn on
any resale of the shares may be underwriting discounts and commissions under the
Securities Act. Selling holders who are "underwriters" within the meaning of
Section 2(11) of the Securities Act will be subject to
31
<PAGE>
the prospectus delivery requirements of the Securities Act. The selling holders
have acknowledged that they understand their obligations to comply with the
provisions of the Exchange Act and the rules thereunder relating to stock
manipulation, particularly Regulation M.
In addition, any securities covered by this prospectus that qualify for sale
pursuant to Rule 144 or Rule 144A of the Securities Act may be sold under
Rule 144 or Rule 144A rather than under this prospectus. A selling holder may
not sell any notes or common stock described in this prospectus and may not
transfer, devise or gift these securities by other means not described in this
prospectus.
To the extent required, the specific notes or common stock to be sold, the
names of the selling holders, the respective purchase prices and public offering
prices, the names of any agent, dealer or underwriter, and any applicable
commissions or discounts with respect to a particular offer will be set forth in
an accompanying prospectus supplement or, if appropriate, a post-effective
amendment to the registration statement of which this prospectus is a part.
We entered into a registration rights agreement for the benefit of holders
of the notes to register their notes and common stock under applicable federal
and state securities laws. The registration rights agreement provides for
cross-indemnification of the selling holders and us and their and our respective
directors, officers and controlling persons against specific liabilities in
connection with the offer and sale of the notes and the common stock, including
liabilities under the Securities Act. We will pay substantially all of the
expenses incurred by the selling holders incident to the offering and sale of
the notes and the common stock, provided that each selling holder will be
responsible for payment of commissions, concessions and discounts of
underwriters, broker-dealers or agents.
VALIDITY OF THE SECURITIES
The validity of the notes and of the common stock offered by this prospectus
will be passed upon for Affymetrix by Sullivan & Cromwell, Los Angeles,
California.
EXPERTS
Ernst & Young LLP, independent auditors, have audited Affymetrix' financial
statements and schedule included in its Annual Report on Form 10-K for the year
ended December 31, 1998, as set forth in their report, which is incorporated by
reference in this document. Our financial statements and schedule are
incorporated by reference in reliance on Ernst & Young LLP's report, given on
their authority as experts in accounting and auditing.
32
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth all expenses, other than the underwriting
discounts and commissions, payable by the Registrant in connection with the sale
of the common stock being registered. All the amounts shown are estimates except
for the registration fee and the filing fee.
<TABLE>
<S> <C>
Registration fee............................................ $ 39,600
Legal fees and expenses..................................... 208,367
Accounting fees and expenses................................ 22,500
Nasdaq National Market filing fee........................... 17,500
Miscellaneous............................................... 212,033
--------
TOTAL..................................................... $500,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
As permitted by Section 102(b)(7) of the Delaware General Corporation Law,
Affymetrix' charter includes a provision that eliminates the personal liability
of a director to Affymetrix or its stockholders for monetary damages arising out
of the director's breach of his or her fiduciary duty. The charter provides,
however, that unless otherwise permitted by applicable law, a director remains
potentially liable for monetary damages for:
- breach of the director's duty of loyalty to Affymetrix or its
stockholders;
- acts or omissions not in good faith or which involve misconduct or a
knowing violation of law;
- an improper payment of a dividend or an improper redemption or repurchase
of Affymetrix' stock (as provided in Section 174 of the Delaware General
Corporation Law); or
- any transaction from which a director derives an improper personal
benefit.
Any repeal or modification of this provision will not affect any right or
protection of a director that exists at the time of such repeal or modification.
Section 145 of the Delaware General Corporation Law empowers a Delaware
corporation to indemnify any persons who are, or are threatened to be made,
parties to any threatened, pending or completed legal action, suit or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by or in the right of such corporation) by reason of the fact that
such person is or was an officer, director, employee or agent of such
corporation, or is or was serving at the request of such corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise. The indemnity may include expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by such person in connection with such action,
suit or proceeding, provided that such officer, director, employee or agent
acted in good faith and in a manner he or she reasonably believed to be in or
not opposed to the corporation's best interests, and, for criminal proceedings,
had no reasonable cause to believe his or her conduct was unlawful. A Delaware
corporation may indemnify officers and directors in an action by or in the right
of the corporation under the same conditions, except that no indemnification is
permitted without judicial approval if the officer or director is adjudged to be
liable to the corporation. Where an officer or director is successful on the
merits or otherwise in the defense of any action referred to above, the
corporation must indemnify him or her against the expenses which such officer or
director actually and reasonably incurred.
II-1
<PAGE>
Article VIII of the bylaws of Affymetrix provides in terms similar to those
of Section 145 of the Delaware General Corporation Law that Affymetrix has the
power and is required to indemnify its directors and officers in accordance with
Delaware Law.
The right to indemnification includes the right to be paid by Affymetrix the
expenses (including attorneys' fees) incurred in defending any suits brought in
advance of their final disposition; provided, however, that if the Delaware
General Corporation Law requires, an advancement of expenses incurred by an
indemnitee in his or her capacity as a director or officer (and not in any other
capacity in which service was or is rendered by the indemnitee, including,
without limitation, service to an employee benefit plan) will be made only upon
delivery to Affymetrix of an undertaking, by or on behalf of the indemnitee, to
repay all amounts so advanced if it will ultimately be determined by final
judicial decision from which there is no further right to appeal. The rights to
indemnification and to the advancement of expenses covered in Sections 1 and 2
of Article VII of Affymetrix' bylaws are contract rights and these rights
continue as to an indemnitee who has ceased to be a director or officer and will
inure to the benefit of his or her heirs, executors and administrators.
If a claim covered by Affymetrix' bylaws (Article VIII, Sections 1 and
2) is not paid in full by Affymetrix within 60 days after a written claim has
been received by Affymetrix, except in the case of advancement of expenses
pursuant to the terms of an undertaking, in which case the applicable period is
20 days, an indemnitee will be entitled to be paid also the expense of
prosecuting or defending the suit. The failure of the indemnitee to meet any
applicable standard for indemnification set forth in the Delaware General
Corporation Law:
- is a defense in any suit brought by the indemnitee to enforce a right to
indemnification (but not in a suit brought by the indemnitee to enforce a
right to an advancement of expenses), and
- entitles Affymetrix to recover an advancement of expenses pursuant to the
terms of an undertaking upon a final adjudication in any suit brought by
Affymetrix to recover an advancement of expenses pursuant to the terms of
an undertaking.
Neither the failure of Affymetrix, including its board of directors, independent
legal counsel, or its stockholders, to have made a determination prior to the
commencement of the suit that indemnification of the indemnitee is proper in the
circumstances because the indemnitee has met the applicable standard of conduct
set forth in the Delaware General Corporation Law, nor an actual determination
by Affymetrix, including its board of directors, independent legal counsel, or
its stockholders, that the indemnitee has not met the applicable standard of
conduct or, in the case of such a suit brought by the indemnitee, is a defense
to the suit. In any suit brought by an indemnitee to enforce a right to
indemnification or to an advancement of expenses, or brought by Affymetrix to
recover an advancement of expenses pursuant to the terms of an undertaking, the
burden of proving that the indemnitee is not entitled to an advancement of
expenses under Article VIII of the bylaws or otherwise will be on Affymetrix.
The rights to indemnification and to the advancement of expenses conferred
in Affymetrix' bylaws are not exclusive of any other right which any person may
have or acquire under Affymetrix' charter, any statute, agreement, vote of
stockholders or disinterested directors or otherwise.
Affymetrix may maintain insurance, at its expense, to protect itself and any
director, officer, employee or agent of Affymetrix or another corporation,
partnership, joint venture, trust or other enterprise against any expense,
liability or loss, whether or not Affymetrix would have the power to indemnify
that person against the expense, liability, or loss under the Delaware General
Corporation Law.
Affymetrix may, to the extent authorized from time to time by the board of
directors, grant rights to indemnification and to the advancement of expenses to
any officer, employee or agent of Affymetrix to the fullest extent of the
provisions allowed by its bylaws with respect to the indemnification and
advancement of expenses of directors and officers of Affymetrix.
II-2
<PAGE>
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF THE DOCUMENT
- --------------------- ---------------------------
<C> <S>
3.1 Amended and Restated Certificate of Incorporation of
Affymetrix, Inc.(1)
3.2 Bylaws of Affymetrix, Inc.(1)
4.1 Reference is made to Exhibits 3.1 and 3.2
4.2 Specimen Stock Certificate(2)
4.3 Registration Rights Agreement, dated as of September 22,
1999, between Affymetrix and certain purchasers listed on
the signature page thereto(3)
4.4 Indenture, dated as of September 22, 1999, between
Affymetrix and The Bank of New York, as Trustee(3)
5.1 Opinion of Sullivan & Cromwell(3)
23.1 Consent of Ernst & Young LLP, independent auditors
23.2 Consent of Sullivan & Cromwell (included in Exhibit 5.1)(3)
24.1 Power of Attorney (included on the signature
page hereto)(3)
25.1 Form T-1 Statement of Eligibility and Qualification of
Trustee(3)
</TABLE>
- ------------------------
(1) Incorporated by reference to our Definitive Proxy Statement on Schedule 14A
filed on April 29, 1998.
(2) Incorporated by reference to Exhibit 4.1 to our Registration Statement
(No. 333-3648) on Form S-1 filed on June 3, 1996.
(3) Previously filed.
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) 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
Securities Act of 1933.
(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 20 percent 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 registration statement;
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(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
II-3
<PAGE>
to the Commission by the registrant pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment that contains a form of
prospectus 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 thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (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 therein and the
offering of such securities at that time shall be deemed to be the initial BONA
FIDE offering thereof.
(5) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to provisions described in Item 15, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
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.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City and County of Santa Clara, State of California on
January 24, 2000.
<TABLE>
<S> <C> <C>
By: /s/ VERN NORVIEL
-----------------------------------------
Vern Norviel
Senior Vice President, General Counsel and
Corporate Secretary
</TABLE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Stephen Fodor, Edward Hurwitz, and Vern Norviel
and each of them, as his true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments, exhibits thereto and other documents in connection
therewith) to this registration statement and any subsequent registration
statement filed by the registrant pursuant to Securities and Exchange Commission
Rule 462, which relates to this registration statement and to file the same,
with all exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, or their or his substitute or substitutes, may lawfully do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
*
-------------------------------------- Chief Executive Officer and January 24, 2000
Stephen P.A. Fodor, Ph.D. Chairman of the Board
Vice President and Chief
* Financial Officer (Principal
-------------------------------------- Financial and Accounting January 24, 2000
Edward M. Hurwitz Officer)
*
-------------------------------------- Vice Chairman of the Board January 24, 2000
John D. Diekman, Ph.D.
*
-------------------------------------- Director January 24, 2000
Paul Berg, Ph.D.
-------------------------------------- Director
Adrian Hennah
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
*
-------------------------------------- Director January 24, 2000
Vernon R. Loucks, Jr.
*
-------------------------------------- Director January 24, 2000
Barry C. Ross, Ph.D.
*
-------------------------------------- Director January 24, 2000
David B. Singer
*
-------------------------------------- Director January 24, 2000
Lubert Stryer, M.D.
*
-------------------------------------- Director January 24, 2000
John A. Young
</TABLE>
<TABLE>
<S> <C> <C> <C>
*By: /s/ VERN NORVIEL
---------------------------------
Vern Norviel
AS ATTORNEY-IN-FACT
</TABLE>
II-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF THE DOCUMENT
- --------------------- ---------------------------
<C> <S>
3.1 Amended and Restated Certificate of Incorporation of
Affymetrix, Inc.(1)
3.2 Bylaws of Affymetrix, Inc.(1)
4.1 Reference is made to Exhibits 3.1 and 3.2
4.2 Specimen Stock Certificate(2)
4.3 Registration Rights Agreement, dated as of September 22,
1999, between Affymetrix and certain purchasers listed on
the signature page thereto(3)
4.4 Indenture, dated as of September 22, 1999, between
Affymetrix and The Bank of New York, as Trustee(3)
5.1 Opinion of Sullivan & Cromwell(3)
23.1 Consent of Ernst & Young LLP, independent auditors
23.2 Consent of Sullivan & Cromwell (included in Exhibit 5.1)(3)
24.1 Power of Attorney (included in the signature page)(3)
25.1 Form T-1 Statement of Eligibility and Qualification of
Trustee(3)
</TABLE>
- ------------------------
(1) Incorporated by reference to our Definitive Proxy Statement on Schedule 14A
filed on April 29, 1998.
(2) Incorporated by reference to Exhibit 4.1 to our Registration Statement
(No. 333-3648) on Form S-1 filed on June 3, 1996.
(3) Previously filed.
<PAGE>
EXHIBIT 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in
Amendment No. 1 to the Registration Statement (Form S-3) of Affymetrix, Inc. for
the registration of $150,000,000 of 5% Convertible Subordinated Notes Due 2006
(the "Notes") and 1,219,515 shares of its Common Stock issuable upon conversion
of the Notes and to the incorporation by reference therein of our report dated
January 29, 1999 (except for Note 11, as to which the date is March 25, 1999)
with respect to the financial statements and schedule of Affymetrix, Inc.
included in its Annual Report (Form 10-K) for the year ended December 31, 1998,
filed with the Securities and Exchange Commission.
/s/ Ernst & Young
Palo Alto, California
January 24, 2000
