UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QA
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- --------- EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30,
1996.
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- --------- EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM __________ TO
_____________ .
Commission File Number 0-22570
Lynx Therapeutics, Inc.
(Exact name of registrant as specified in its charter)
Delaware 94-3161073
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3832 Bay Center Place
Hayward, CA 94545
(Address of principal executive offices) (Zip Code)
(510) 670-9300
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
--- ---
The number of shares of Common Stock, Series B Preferred Stock, Series C
Preferred Stock, and Series D Preferred Stock outstanding as of September 30,
1996 were 2,345,466, 332,288, 123,299 and 40,000, respectively. The Series B,
Series C and Series D Preferred Stock are convertible into Common Stock on a
ten-for-one basis. Information regarding the aggregate market value of the
Registrant's voting stock is not included because there is currently no public
trading market for the Company's voting stock.
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PART II: OTHER INFORMATION
- ---------------------------
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
The following documents are filed as Exhibits to this
report:
Exhibit
Number Description
------- -----------
10.32 Collaboration Agreement dated as of September 30,
1996, by and among the Company and Schwarz Pharma AG**
11.0 Statement re: Computation of Earnings Per Share
27.1 Financial Data Schedule
- ----------
** Portions of this agreement have been deleted pursuant to our request for
confidential treatment.
(b) No reports on Form 8-K were filed during the quarter
ended September 30, 1996.
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
LYNX THERAPEUTICS, INC.
/s/ Sam Eletr
------------------------------------------------------
By: Sam Eletr, Ph.D.
Chief Executive Officer
Date: November 15, 1996
/s/ Craig C. Taylor
------------------------------------------------------
By: Craig C. Taylor
Acting Chief Financial Officer
(Principal Financial and Accounting Officer)
Date: November 15, 1996
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(d) No Violation. Neither Schwarz Pharma nor any of its
Affiliates is a party to, subject to, or bound by an agreement or judgment,
award, order or writ, injunction or decree of any court, governmental body or
arbitrator which would conflict with or be breached by the execution, delivery
or performance of this Agreement and there is (a) no action, suit, dispute or
governmental, administrative, arbitration or regulatory proceeding pending or
threatened nor (b) any investigation pending or threatened against or relating
to Schwarz Pharma which, in each case, could prevent Schwarz Pharma from
carrying out its obligations under this Agreement.
13. TERM OF AGREEMENT AND TERMINATION.
13.1 Term. Unless terminated in accordance with this Article 13 or
Section 3.4, this Agreement shall expire upon the later of (i) 10 years after
commencement of marketing the Product in a Major Country or (ii) expiration of
the last to expire of the Lynx Patents issued in the Territory. The Parties
agree that at least two (2) years prior to the expiration of this Agreement
under this Section 13.1 the Parties will meet, discuss in good faith and attempt
to reach mutually acceptable agreement to provide for Lynx's continuing supply
to Schwarz Pharma of Product and economic terms for such supply. Schwarz Pharma
shall be obligated to continue to purchase Product from Lynx under such
agreement so long as Lynx is able to supply the Product at prices comparable to
those available on the market and in appropriate quantities and quality. As used
herein, "comparable" means within [REDACTED] of the price of supply available on
the market. If Lynx is unable to meet such requirements, then under the terms of
such agreement Schwarz Pharma may thereafter purchase the Product from a Third
Party or manufacture it itself.
13.2 Termination For Material Breach. Each Party shall have the right
to terminate this Agreement after written notice to the other that the other is
in material breach of this Agreement, unless the other Party cures the breach
before the expiration of 90 days after such written notice. Notwithstanding the
foregoing, Lynx may terminate this Agreement in the event Schwarz Pharma
breaches a payment obligation hereunder and thereafter fails to make full
payment of amounts due Lynx within 30 days after written notice from Lynx to
Schwarz Pharma, provided, however, that Schwarz Pharma may withhold a particular
payment for so long as Schwarz Pharma is pursuing in good faith a claim that
Lynx has not performed the specific tasks necessary to earn such payment. Any
failure by Lynx to terminate this Agreement for late payments shall not be
deemed a waiver of its right to terminate this Agreement in the future for a
future late payment by Schwarz Pharma.
13.3 Termination without Cause. Schwarz Pharma shall have the right to
terminate the Agreement at any time without the requirement of showing cause,
upon [REDACTED]
CONFIDENTIAL TREATMENT REQUESTED
44.
