As filed with the Securities and Exchange Commission on October 1, 2003
Registration No. _________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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GERON CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
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Delaware 75-2287752
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
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230 Constitution Drive
Menlo Park, California 94025
(650) 473-7700
(Address, Including Zip Code and Telephone Number,
Including Area Code, of Registrant's Principal Executive Offices)
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Thomas B. Okarma
President and Chief Executive Officer
Geron Corporation
230 Constitution Drive
Menlo Park, California 94025
(650) 473-7700
(Name, Address, Including Zip Code and Telephone Number,
Including Area Code, of Agent for Service)
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Copies to:
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Alan C. Mendelson, Esq.
Latham & Watkins LLP
135 Commonwealth Drive
Menlo Park, California 94025
(650) 328-4600
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Approximate date of commencement of proposed sale to the public: From
time to time after this Registration Statement becomes effective.
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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.
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
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CALCULATION OF REGISTRATION FEE
==================================================================================================================================
Proposed Maximum Proposed Maximum Amount of
Title of Securities to be Amount to be Offering Price per Aggregate Offering Registration
Registered Registered(1) share Price Fee
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Common Stock, par value $.001 per
share 31,080 shares $13.92 (2) $432,633.60 $35.00 (3)
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(1) In the event of a stock split, stock dividend, or similar transaction
involving Geron's common stock, in order to prevent dilution, the number of
shares registered shall automatically be increased to cover the additional
shares in accordance with Rule 416(a) under the Securities Act.
(2) The offering price is estimated solely for the purpose of calculating the
registration fee in accordance with Rule 457(c) and based upon the average
of the high and low prices reported by Nasdaq National Market on September
30, 2003.
(3) Calculated in accordance with Rule 457(o) under the Securities Act of 1933.
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 hereafter 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 Securities and Exchange Commission, acting
pursuant to said Section 8(A), may determine.
================================================================================
SUBJECT TO COMPLETION, DATED OCTOBER 1, 2003
UP TO 31,080 SHARES OF
GERON CORPORATION
COMMON STOCK
Our common stock is traded on the Nasdaq National Market under the symbol
"GERN." On September 30, 2003, the closing price of our common stock was $13.69.
This prospectus relates to the sale of up to 31,080, shares of our common
stock by Transgenomic, Inc. We will not receive any of the proceeds from the
sale of these shares covered by this prospectus.
Investing in our common stock involves a high degree of risk. See "Risk
Factors" beginning on page 3.
----------------------
Neither the Securities and Exchange Commission (the "SEC") nor any state
securities commission has approved or disapproved of these securities or passed
upon the accuracy or adequacy of the prospectus. Any representation to the
contrary is a criminal offense.
----------------------
The date of this prospectus is October 1, 2003.
TABLE OF CONTENTS
Page
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ABOUT GERON....................................................................4
RISK FACTORS...................................................................4
FORWARD-LOOKING STATEMENTS....................................................16
USE OF PROCEEDS...............................................................16
DESCRIPTION OF OUR COMMON STOCK...............................................16
SELLING STOCKHOLDER...........................................................16
PLAN OF DISTRIBUTION..........................................................18
LEGAL MATTERS.................................................................19
EXPERTS.......................................................................19
LIMITATION ON LIABILITY AND DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES................................19
WHERE YOU CAN FIND MORE INFORMATION...........................................20
DOCUMENTS WE HAVE INCORPORATED BY REFERENCE...................................20
ABOUT GERON
We are a biopharmaceutical company focused on developing and
commercializing therapeutic and diagnostic products for applications in oncology
and regenerative medicine, and research tools for drug discovery. Our product
development programs are based upon three patented core technologies:
telomerase, human embryonic stem cells and nuclear transfer. Telomeres are the
ends of chromosomes that protect chromosomes from degradation and act as a
molecular "clock" for cellular aging. Telomerase is an enzyme that restores
telomere length and rewinds the molecular "clock," thereby extending the cell's
ability to multiply or replicate. By activating telomerase, we seek to increase
the lifespan of normal cells which have prematurely aged in the body to treat
certain chronic degenerative diseases. Conversely, by inhibiting or targeting
telomerase we hope to kill cancer cells in which telomerase is abnormally turned
on and to diagnose cancer by measuring telomerase activity. Human embryonic stem
cells can develop and differentiate into all cells and tissues in the body. As
such, they are a potential source for the manufacture of replacement cells and
tissues for organ repair applications in regenerative medicine. Nuclear transfer
(sometimes called "somatic cell nuclear transfer") is a method for generating
whole animals from genetic material derived solely from the nucleus of a single
cell obtained from a single animal. We are actively licensing this technology to
others for applications in agriculture and production of biologicals.
We were incorporated in 1990 under the laws of Delaware. Our principal
executive offices are located at 230 Constitution Drive, Menlo Park, California
94025 and our telephone number is (650) 473-7700.
RISK FACTORS
Our business is subject to various risks, including those described below.
You should carefully consider these risk factors, together with all of the other
information included in this Form S-3. Any of these risks could materially
adversely affect our business, operating results and financial condition.
Our business is at an early stage of development.
The science and technology of telomere biology and telomerase, human
embryonic stem cells, and nuclear transfer are relatively new. Our business is
at an early stage of development, in that we do not yet have products in
late-stage clinical trials or on the market. Our ability to produce products
that progress to and through clinical trials is subject to our ability to, among
other things:
o continue to have success with our research and development efforts;
o select therapeutic compounds for development;
o obtain the required regulatory approvals; and
o manufacture and market resulting products.
When potential lead drug compounds or product candidates are identified
through our research programs, they will require significant preclinical and
clinical testing prior to regulatory approval in the United States and
elsewhere. In addition, we will also need to determine whether any of these
potential products can be manufactured in commercial quantities at an acceptable
cost. Our efforts may not result in a product that can be marketed. Because of
the significant scientific, regulatory and commercial milestones that must be
reached for any of our development programs to be successful, any program may be
abandoned, even after significant resources have been expended.
We have a history of losses and anticipate future losses; continued losses could
impair our ability to sustain operations.
We have incurred operating losses every year since our operations began in
1990. As of June 30, 2003, our accumulated deficit was approximately $243.0
million. Losses have resulted principally from costs incurred in connection with
our research and development activities and from general and administrative
costs associated with our operations. We expect to incur additional operating
losses as our development efforts and clinical testing activities are continued.
Substantially all of our revenues to date have been research support payments
under
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collaboration agreements. We may be unsuccessful in entering into any new
corporate collaboration that results in revenues. Even if we are able to obtain
new collaboration arrangements with third parties, the revenues generated from
these arrangements may not be sufficient alone to continue or expand our
research or development activities and otherwise sustain our operations.
We are unable to estimate at this time the level of revenue to be received
from the sale of diagnostic products and telomerase-immortalized cell lines, and
do not currently expect to receive significant revenues from the sale of these
products. Our ability to continue or expand our research activities and
otherwise sustain our operations is dependent on our ability, alone or with
others to, among other things, manufacture and market therapeutic products. We
may never receive material revenues from product sales or if we do receive
revenues, such revenues may not be sufficient to continue or expand our research
or development activities and otherwise sustain our operations.
We will need additional capital to conduct our operations and develop our
products, and our ability to obtain the necessary funding is uncertain.
We will require substantial capital resources in order to conduct our
operations and develop our products. While we estimate that our existing capital
resources, interest income and equipment financing arrangements will be
sufficient to fund our current and planned operations through June 30, 2005, we
cannot guarantee that this will be the case. The timing and degree of any future
capital requirements will depend on many factors, including:
o the accuracy of the assumptions underlying our estimates for our capital
needs in 2003 and beyond;
o continued scientific progress in our research and development programs;
o the magnitude and scope of our research and development programs;
o our ability to maintain and establish strategic arrangements for
research, development, clinical testing, manufacturing and marketing;
o our progress with preclinical and clinical trials;
o the time and costs involved in obtaining regulatory approvals;
o the costs involved in preparing, filing, prosecuting, maintaining,
defending and enforcing patent claims; and
o the potential for new technologies and products.
We intend to acquire additional funding through strategic collaborations,
public or private equity financings, capital lease transactions or other
financing sources that may be available. Additional financing may not be
available on acceptable terms, or at all. Additional equity financings could
result in significant dilution to stockholder. Further, in the event that
additional funds are obtained through arrangements with collaborative partners,
these arrangements may require us to relinquish rights to some of our
technologies, product candidates or products that we would otherwise seek to
develop and commercialize ourselves. If sufficient capital is not available, we
may be required to delay, reduce the scope of or eliminate one or more of our
programs, any of which could have a material adverse effect on our business.
We may be unable to identify a safe and effective inhibitor of telomerase that
can be developed into a commercially viable cancer treatment product, which
would adversely impact our future business prospects.
As a result of our drug discovery efforts to date, we have identified
compounds in laboratory studies that demonstrate potential for inhibiting
telomerase in humans. We have selected one of these compounds, GRN163, as a lead
compound for development as a telomerase inhibitor for cancer. Further research
is required to determine if this compound can be fully developed as an
efficacious, safe and commercially viable treatment for cancer.
This compound, and other compounds we have identified, may prove to have
undesirable and unintended side effects or other characteristics adversely
affecting its safety, efficacy or cost-effectiveness that would likely prevent
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or limit its commercial use. Accordingly, it may not be appropriate for us to
proceed with clinical development, to obtain regulatory approval or to market a
telomerase inhibitor for the treatment of cancer. If we abandon our research for
cancer treatment for any of these reasons or for other reasons, our business
prospects would be materially and adversely affected.
If our access to necessary tissue samples, information or licensed technologies
is restricted, we will not be able to develop our business.
To continue the research and development of our therapeutic and diagnostic
products, we need access to normal and diseased human and other tissue samples,
other biological materials and related clinical and other information. We
compete with many other companies for these materials and information. We may
not be able to obtain or maintain access to these materials and information on
acceptable terms, if at all. In addition, government regulation in the United
States and foreign countries could result in restricted access to, or
prohibiting the use of, human and other tissue samples. If we lose access to
sufficient numbers or sources of tissue samples, or if tighter restrictions are
imposed on our use of the information generated from tissue samples, our
business will be materially harmed.
Some of our competitors may develop technologies that are superior to or more
cost-effective than ours, which may impact the commercial viability of our
technologies and which may significantly damage our ability to sustain
operations.
The pharmaceutical and biotechnology industries are intensely competitive.
Other pharmaceutical and biotechnology companies and research organizations
currently engage in or have in the past engaged in efforts related to the
biological mechanisms that are the focus of our programs in oncology and
regenerative medicine, including the study of telomeres, telomerase, human
embryonic stem cells, and nuclear transfer. In addition, other products and
therapies that could compete directly with the products that we are seeking to
develop and market currently exist or are being developed by pharmaceutical and
biopharmaceutical companies and by academic and other research organizations.
Many companies are also developing alternative therapies to treat cancer
and, in this regard, are competitors of ours. According to published reports as
of December 2002, there are approximately 90 approved anti-cancer products on
the market in the United States, and several hundred in clinical development.
Many of the pharmaceutical companies developing and marketing these competing
products (including Astra-Zeneca, Bristol-Meyers Squibb and Novartis, among
others) have significantly greater financial resources and expertise than we do
in:
o research and development;
o manufacturing;
o preclinical and clinical testing;
o obtaining regulatory approvals; and
o marketing.
Smaller companies may also prove to be significant competitors,
particularly through collaborative arrangements with large and established
companies. Academic institutions, government agencies and other public and
private research organizations may also conduct research, seek patent protection
and establish collaborative arrangements for research, clinical development and
marketing of products similar to ours. These companies and institutions compete
with us in recruiting and retaining qualified scientific and management
personnel as well as in acquiring technologies complementary to our programs.
In addition to the above factors, we expect to face competition in the
following areas:
o product efficacy and safety;
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o the timing and scope of regulatory consents;
o availability of resources;
o reimbursement coverage;
o price; and
o patent position, including potentially dominant patent positions of
others.
As a result of the foregoing, our competitors may develop more effective or
more affordable products, or achieve earlier patent protection or product
commercialization than we do. Most significantly, competitive products may
render the products that we develop obsolete.
The ethical, legal and social implications of our research using embryonic stem
cells and nuclear transfer could prevent us from developing or gaining
acceptance for commercially viable products in this area.
Our programs in regenerative medicine may involve the use of stem cells
that are derived from human embryonic tissue. The use of human embryonic stem
cells gives rise to ethical, legal and social issues regarding the appropriate
use of these cells. In the event that our research related to human embryonic
stem cells becomes the subject of adverse commentary or publicity, the market
price for our common stock could be significantly harmed.
Some groups have voiced opposition to our technology and practices. The
concepts of cell regeneration, cell immortality, and nuclear transfer have
stimulated significant debate in social and political arenas. We use stem cells
derived through a process that uses as the starting material donated embryos
created for in vitro fertilization procedures but no longer needed or suitable
for that use. Many research institutions, including some of our scientific
collaborators, have adopted policies regarding the ethical use of human
embryonic tissue. These policies may have the effect of limiting the scope of
research conducted using human embryonic stem cells, resulting in reduced
scientific progress. In addition, the United States government and its agencies
have in recent years refused to fund research which involves the use of human
embryonic tissue. President Bush announced on August 9, 2001 that he would
permit federal funding of research on human embryonic stem cells using the
limited number of embryonic stem cell lines that had already been created, but
relatively few federal grants have been made so far. The President's Council on
Bioethics will monitor stem cell research, and the guidelines and regulations it
recommends may include restrictions on the scope of research using human
embryonic or fetal tissue. The Council issued a report in July 2002 that
recommended "that the federal government undertake a thorough-going review of
present and projected practices of human embryo research, with the aim of
establishing appropriate institutions to advise and shape federal policy in this
arena." Our inability to conduct research using human embryonic stem cells due
to such factors as government regulation or otherwise could have a material
adverse effect on us.
Finally, we acquired Roslin Bio-Med to gain the rights to somatic cell
nuclear transfer technology (sometimes called "somatic cell nuclear transfer").
We acquired exclusive rights to this technology for all areas except human
reproductive cloning and certain other limited applications. Although we will
not be pursuing human reproductive cloning, the use of nuclear transfer to
produce embryonic stem cells (referred to as "therapeutic cloning") could
provide scientific insights that would help us advance our research.
Government-imposed restrictions with respect to any or all of these practices
could:
o harm our ability to establish critical partnerships and collaborations;
o prompt government regulation of our technologies;
o cause delays in our research and development; and
o cause a decrease in the price of our stock.
The U.S. Congress has recently considered legislation that would ban human
therapeutic cloning as well as reproductive cloning. Such a bill has been passed
by the House of Representatives, although not by the Senate, and
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many legislators reportedly favor such a ban. The July 2002 report of the
President's Council on Bioethics recommended a four-year moratorium on
therapeutic cloning. If human therapeutic cloning is restricted or banned, our
ability to commercialize those applications could be significantly harmed. Also,
if regulatory bodies were to ban nuclear transfer processes, our research using
nuclear transfer technology could be canceled and our business could be
significantly harmed.
Entry into clinical trials with one or more products may not result in any
commercially viable products.
We do not expect to generate any significant revenues from product sales
for a period of several years. We may never generate revenues from product sales
or become profitable because of a variety of risks inherent in our business,
including the following risks:
o clinical trials may not demonstrate the safety and efficacy of our
products;
o completion of clinical trials may be delayed, or costs of clinical trials
may exceed anticipated amounts;
o we may not be able to obtain regulatory approval of our products, or may
experience delays in obtaining such approvals;
o we may not be able to manufacture our drugs economically on a commercial
scale;
o we and our licensees may not be able to successfully market our products;
o physicians may not prescribe our products, or patients may not accept
such products;
o others may have proprietary rights which prevent us from marketing our
products; and
o competitors may sell similar, superior or lower-cost products.
Impairment of our intellectual property rights may limit our ability to pursue
the development of our intended technologies and products.
Protection of our proprietary technology is critically important to our
business. Our success will depend in part on our ability to obtain and enforce
our patents and maintain trade secrets, both in the United States and in other
countries. The patent positions of pharmaceutical and biopharmaceutical
companies, including ours, are highly uncertain and involve complex legal and
technical questions. In particular, legal principles for biotechnology patents
in the United States and in other countries are evolving, and the extent to
which we will be able to obtain patent coverage to protect our technology, or
enforce issued patents, is uncertain. Further, our patents may be challenged,
invalidated or circumvented, and our patent rights may not provide proprietary
protection or competitive advantages to us. In the event that we are
unsuccessful in obtaining and enforcing patents, our business would be
negatively impacted.
Publication of discoveries in scientific or patent literature tends to lag
behind actual discoveries by at least several months and sometimes several
years. Therefore, the persons or entities that we or our licensors name as
inventors in our patents and patent applications may not have been the first to
invent the inventions disclosed in the patent applications or patents, or file
patent applications for these inventions. As a result, we may not be able to
obtain patents for discoveries that we otherwise would consider patentable and
that we consider to be extremely significant to our future success.
Where several parties seek patent protection for the same technology, the
U.S. Patent Office may declare an interference proceeding in order to ascertain
the party to which the patent should be issued. Patent interferences are
typically complex, highly contested legal proceedings, subject to appeal. They
are usually expensive and prolonged, and can cause significant delay in the
issuance of patents. Moreover, parties that receive an adverse decision in an
interference can lose important patent rights. Our pending patent applications,
or our issued patents, may be drawn into interference proceedings which may
delay or prevent the issuance of patents, or result in the loss of issued patent
rights.
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The interference process can also be used to challenge a patent that has
been issued to another party. In 2001, the U.S. Patent Office granted our
request for the declaration of an interference between one of our pending
applications relating to nuclear transfer and an issued patent, held by the
University of Massachusetts. We requested this interference in order to clarify
our patent rights in nuclear transfer technology. In March 2002, a second
interference was declared involving our patent application and a patent
application held by Infigen Inc. Both of these interferences are now ongoing.
Based on a review of publicly available information, we believe that the
technology at issue in both of these interferences was invented first at the
Roslin Institute and is encompassed within our nuclear transfer license.
However, we do not have access to the other party's invention records, and, as
in any legal proceeding, the outcome is uncertain.
Outside of the U.S., certain jurisdictions, such as Europe and Australia,
permit oppositions to be filed against the granting of patents. Because our
intent is to commercialize products internationally, securing both proprietary
protection and freedom to operate outside of the U.S. is important to us. We are
involved in both opposing the grant of patents to others through such opposition
proceedings, and in defending against oppositions filed by others.
If interferences, oppositions or other challenges to our patent rights are
not resolved promptly in our favor, our existing business relationships may be
jeopardized and we could be delayed or prevented from entering into new
collaborations or from commercializing certain products, which could materially
harm our business.
Patent litigation may also be necessary to enforce patents issued or
licensed to us or to determine the scope and validity of our proprietary rights
or the proprietary rights of another. We may not be successful in any patent
litigation. Patent litigation can be extremely expensive and time-consuming,
even if the outcome is favorable to us. An adverse outcome in a patent
litigation or any other proceeding in a court or patent office could subject our
business to significant liabilities to other parties, require disputed rights to
be licensed from other parties or require us to cease using the disputed
technology.
If we fail to meet our obligations under license agreements, we may face loss of
our rights to key technologies on which our business depends.
Our business depends on our three core technology platforms, each of which
is based in part on patents licensed from third parties. Those third-party
license agreements impose obligations on us, such as payment obligations and
obligations to diligently pursue development of commercial products under the
licensed patents. If a licensor believes that we have failed to meet our
obligations under a license agreement, the licensor could seek to limit or
terminate our license rights, which would most likely lead to costly and
time-consuming litigation. During the period of any such litigation our ability
to carry out the development and commercialization of potential products could
be significantly and negatively affected. If our license rights were ultimately
lost, our ability to continue our business based on the affected technology
platform would be severely affected.
We may be subject to litigation that will be costly to defend or pursue and
uncertain in its outcome.
Our business may bring us into conflict with our licensees, licensors, or
others with whom we have contractual or other business relationships, or with
our competitors or others whose interests differ from ours. If we are unable to
resolve those conflicts on terms that are satisfactory to all parties, we may
become involved in litigation brought by or against us. That litigation is
likely to be expensive and may require a significant amount of management's time
and attention, at the expense of other aspects of our business. The outcome of
litigation is always uncertain, and in some cases could include judgments
against us that require us to pay damages, enjoin us from certain activities, or
otherwise affect our legal or contractual rights, which could have a significant
effect on our business.
We may be subject to infringement claims that are costly to defend, and which
may limit our ability to use disputed technologies and prevents us from pursuing
research and development or commercialization of potential products.
Our commercial success depends significantly on our ability to operate
without infringing patents and the proprietary rights of others. Our
technologies may infringe the patents or proprietary rights of others. In
addition, we may become aware of discoveries and technology controlled by third
parties that are advantageous to our research
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programs. In the event our technologies do infringe on the rights of others or
we require the use of discoveries and technology controlled by third parties, we
may be prevented from pursuing research, development or commercialization of
potential products or may be required to obtain licenses to those patents or
other proprietary rights or develop or obtain alternative technologies. We may
not be able to obtain alternative technologies or any required license on
commercially favorable terms, if at all. If we do not obtain the necessary
licenses or alternative technologies, we may be delayed or prevented from
pursuing the development of some potential products. Our failure to obtain
alternative technologies or a license to any technology that we may require to
develop or commercialize our products will significantly and negatively affect
our business.
Much of the information and know-how that is critical to our business is not
patentable and we may not be able to prevent others from obtaining this
information and establishing competitive enterprises.
We sometimes rely on trade secrets to protect our proprietary technology,
especially in circumstances in which patent protection is not believed to be
appropriate or obtainable. We attempt to protect our proprietary technology in
part by confidentiality agreements with our employees, consultants,
collaborators and contractors. We cannot assure you that these agreements will
not be breached, that we would have adequate remedies for any breach, or that
our trade secrets will not otherwise become known or be independently discovered
by competitors, any of which would harm our business significantly.
We depend on our collaborators to help us complete the process of developing and
testing our products and our ability to develop and commercialize products may
be impaired or delayed if our collaborative partnerships are unsuccessful.
Our strategy for the development, clinical testing and commercialization of
our products requires entering into collaborations with corporate partners,
licensors, licensees and others. We are dependent upon the subsequent success of
these other parties in performing their respective responsibilities and the
continued cooperation of our partners. Our collaborators may not cooperate with
us or perform their obligations under our agreements with them. We cannot
control the amount and timing of our collaborators' resources that will be
devoted to our research activities related to our collaborative agreements with
them. Our collaborators may choose to pursue existing or alternative
technologies in preference to those being developed in collaboration with us.
Under agreements with collaborators, we rely significantly on them, among
other activities, to:
o design and conduct advanced clinical trials in the event that we reach
clinical trials;
o fund research and development activities with us;
o pay us fees upon the achievement of milestones; and
o market with us any commercial products that result from our
collaborations.
The development and commercialization of potential products will be delayed
if collaborators fail to conduct these activities in a timely manner or at all.
In addition, our collaborators could terminate their agreements with us and we
may not receive any development or milestone payments. If we do not achieve
milestones set forth in the agreements, or if our collaborators breach or
terminate their collaborative agreements with us, our business may be materially
harmed.
Our reliance on the research activities of our non-employee scientific
consultants and other research institutions, whose activities are not wholly
within our control, may lead to delays in technological developments.
We rely extensively and have relationships with scientific consultants at
academic and other institutions, some of whom conduct research at our request.
These scientific consultants are not our employees and may have commitments to,
or consulting or advisory contracts with, other entities that may limit their
availability to us. We have limited control over the activities of these
consultants and, except as otherwise required by our collaboration and
consulting agreements, can expect only limited amounts of their time to be
dedicated to our activities. If our scientific consultants are unable or refuse
to contribute to the development of any of our potential discoveries, our
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ability to generate significant advances in our technologies will be
significantly harmed.
In addition, we have formed research collaborations with many academic and
other research institutions throughout the world, including the Roslin
Institute. These research facilities may have commitments to other commercial
and non-commercial entities. We have limited control over the operations of
these laboratories and can expect only limited amounts of time to be dedicated
to our research goals.
The loss of key personnel could slow our ability to conduct research and develop
products.
Our future success depends to a significant extent on the skills,
experience and efforts of our executive officers and key members of our
scientific staff. Competition for personnel is intense and we may be unable to
retain our current personnel or attract or assimilate other highly qualified
management and scientific personnel in the future. The loss of any or all of
these individuals could harm our business and might significantly delay or
prevent the achievement of research, development or business objectives.
We also rely on consultants and advisors who assist us in formulating our
research and development and clinical strategy. We face intense competition for
qualified individuals from numerous pharmaceutical, biopharmaceutical and
biotechnology companies, as well as academic and other research institutions. We
may not be able to attract and retain these individuals on acceptable terms.
Failure to do so would materially harm our business.
We may not be able to obtain or maintain sufficient insurance on commercially
reasonable terms or with adequate coverage against potential liabilities in
order to protect ourselves against product liability claims.
Our business exposes us to potential product liability risks that are
inherent in the testing, manufacturing and marketing of human therapeutic and
diagnostic products. We may become subject to product liability claims if the
use of our products is alleged to have injured subjects or patients. This risk
exists for products tested in human clinical trials as well as products that are
sold commercially. We currently have no clinical trial liability insurance and
we may not be able to obtain and maintain this type of insurance for any of our
clinical trials. In addition, product liability insurance is becoming
increasingly expensive. As a result, we may not be able to obtain or maintain
product liability insurance in the future on acceptable terms or with adequate
coverage against potential liabilities which could have a material adverse
effect on us.
Because we or our collaborators must obtain regulatory approval to market our
products in the United States and foreign jurisdictions, we cannot predict
whether or when we will be permitted to commercialize our products.
Federal, state and local governments in the United States and governments
in other countries have significant regulations in place that govern many of our
activities. The preclinical testing and clinical trials of the products that we
develop ourselves or that our collaborators develop are subject to extensive
government regulation and may prevent us from creating commercially viable
products from our discoveries. In addition, the sale by us or our collaborators
of any commercially viable product will be subject to government regulation from
several standpoints, including the processes of:
o manufacturing;
o advertising and promoting;
o selling and marketing;
o labeling; and
o distributing.
We may not obtain regulatory approval for the products we develop and our
collaborators may not obtain regulatory approval for the products they develop.
Regulatory approval may also entail limitations on the indicated uses of a
proposed product. Because certain of our product candidates involve the
application of new technologies and may be based upon a new therapeutic
approach, such products may be subject to substantial additional review
11
by various government regulatory authorities, and, as a result, we may obtain
regulatory approvals for such products more slowly than for products based upon
more conventional technologies. If, and to the extent that, we are unable to
comply with these regulations, our ability to earn revenues will be materially
and negatively impacted.
The regulatory process, particularly for biopharmaceutical products like
ours, is uncertain, can take many years and requires the expenditure of
substantial resources. Any product that we or our collaborative partners develop
must receive all relevant regulatory agency approvals or clearances before it
may be marketed in the United States or other countries. Generally, biological
drugs and non-biological drugs are regulated more rigorously than medical
devices. In particular, human pharmaceutical therapeutic products are subject to
rigorous preclinical and clinical testing and other requirements by the Food and
Drug Administration in the United States and similar health authorities in
foreign countries. The regulatory process, which includes extensive preclinical
testing and clinical trials of each product in order to establish its safety and
efficacy, is uncertain, can take many years and requires the expenditure of
substantial resources.
Data obtained from preclinical and clinical activities is susceptible to
varying interpretations that could delay, limit or prevent regulatory agency
approvals or clearances. In addition, delays or rejections may be encountered as
a result of changes in regulatory agency policy during the period of product
development and/or the period of review of any application for regulatory agency
approval or clearance for a product. Delays in obtaining regulatory agency
approvals or clearances could:
o significantly harm the marketing of any products that we or our
collaborators develop;
o impose costly procedures upon our activities or the activities of our
collaborators;
o diminish any competitive advantages that we or our collaborative partners
may attain; or
o adversely affect our ability to receive royalties and generate revenues
and profits.
Even if we commit the necessary time and resources, economic and otherwise,
the required regulatory agency approvals or clearances may not be obtained for
any products developed by or in collaboration with us. If regulatory agency
approval or clearance for a new product is obtained, this approval or clearance
may entail limitations on the indicated uses for which it may be marketed that
could limit the potential commercial use of the product. Furthermore, approved
products and their manufacturers are subject to continual review, and discovery
of previously unknown problems with a product or its manufacturer may result in
restrictions on the product or manufacturer, including withdrawal of the product
from the market. Failure to comply with regulatory requirements can result in
severe civil and criminal penalties, including but not limited to:
o recall or seizure of products;
o injunction against manufacture, distribution, sales and marketing; and
o criminal prosecution.
The imposition of any of these penalties could significantly impair our
business, financial condition and results of operations.
To be successful, our products must be accepted by the health care community,
which can be very slow to adopt or unreceptive to new technologies and products.
Our products and those developed by our collaborative partners, if approved
for marketing, may not achieve market acceptance since physicians, patients or
the medical community in general may decide to not accept and utilize these
products. The products that we are attempting to develop may represent
substantial departures from established treatment methods and will compete with
a number of traditional drugs and therapies manufactured and marketed by major
pharmaceutical companies. The degree of market acceptance of any of our
developed products will depend on a number of factors, including:
12
o our establishment and demonstration to the medical community of the
clinical efficacy and safety of our product candidates;
o our ability to create products that are superior to alternatives
currently on the market;
o our ability to establish in the medical community the potential advantage
of our treatments over alternative treatment methods; and
o reimbursement policies of government and third-party payors.
If the health care community does not accept our products for any of the
foregoing reasons, or for any other reason, our business would be materially
harmed.
The reimbursement status of newly-approved health care products is uncertain and
failure to obtain reimbursement approval could severely limit the use of our
products.
Significant uncertainty exists as to the reimbursement status of newly
approved health care products, including pharmaceuticals. If we fail to generate
adequate third party reimbursement for the users of our potential products and
treatments, then we may be unable to maintain price levels sufficient to realize
an appropriate return on our investment in product development.
In both domestic and foreign markets, sales of our products, if any, will
depend in part on the availability of reimbursement from third-party payors,
examples of which include:
o government health administration authorities;
o private health insurers;
o health maintenance organizations; and
o pharmacy benefit management companies.
Both federal and state governments in the United States and foreign
governments continue to propose and pass legislation designed to contain or
reduce the cost of health care through various means. Legislation and
regulations affecting the pricing of pharmaceuticals and other medical products
may change or be adopted before any of our potential products are approved for
marketing. Cost control initiatives could decrease the price that we receive for
any product we may develop in the future. In addition, third-party payors are
increasingly challenging the price and cost-effectiveness of medical products
and services and any of our potential products and treatments may ultimately not
be considered cost effective by these third parties. Any of these initiatives or
developments could materially harm our business.
Our products are likely to be expensive to manufacture, and they may not be
profitable if we are unable to significantly reduce the costs to manufacture
them.
Both GRN163 and our hESC-based products are likely to be significantly more
expensive to manufacture than most other drugs currently on the market today.
Oligonucleotides are large molecules with complex chemistry, and the cost of
manufacturing even a short oligonucleotide like GRN163 is considerably greater
than the cost of making most small-molecule drugs. Our present manufacturing
processes are conducted at a relatively small scale and are at an early stage of
development. We hope to substantially reduce manufacturing costs by process
improvements, as well as through scale increases. If we are not able to do so,
however, and depending on the pricing of the product, the profit margin on
GRN163 may be significantly less than that of most drugs on the market today.
Similarly, we currently make differentiated cells from hESCs on a laboratory
scale, at a high cost per unit of measure. The cell-based therapies we are
developing based on hESCs will probably require large quantities of cells. We
continue to develop processes to scale up production of the cells in a
cost-effective way. If we cannot continue to improve our manufacturing
processes, we may not be able to charge a high enough price for our cell therapy
products, even if they are safe and effective, to make a profit. If we are
unable to realize significant profits from our potential
13
products, our business would be materially harmed.
Our activities involve hazardous materials and improper handling of these
materials by our employees or agents could expose us to significant legal and
financial penalties.
Our research and development activities involve the controlled use of
hazardous materials, chemicals and various radioactive compounds. As a
consequence, we are subject to numerous environmental and safety laws and
regulations, including those governing laboratory procedures, exposure to
blood-borne pathogens and the handling of biohazardous materials. We may be
required to incur significant costs to comply with current or future
environmental laws and regulations and may be adversely affected by the cost of
compliance with these laws and regulations.
Although we believe that our safety procedures for using, handling, storing
and disposing of hazardous materials comply with the standards prescribed by
state and federal regulations, the risk of accidental contamination or injury
from these materials cannot be eliminated. In the event of such an accident,
state or federal authorities could curtail our use of these materials and we
could be liable for any civil damages that result, the cost of which could be
substantial. Further, any failure by us to control the use, disposal, removal or
storage of, or to adequately restrict the discharge of, or assist in the cleanup
of, hazardous chemicals or hazardous, infectious or toxic substances could
subject us to significant liabilities, including joint and several liability
under certain statutes, and any liability could exceed our resources and could
have a material adverse effect on our business, financial condition and results
of operations. Additionally, an accident could damage our research and
manufacturing facilities and operations.
Additional federal, state and local laws and regulations affecting us may
be adopted in the future. We may incur substantial costs to comply with these
laws and regulations and substantial fines or penalties if we violate any of
these laws or regulations.
Our stock price has historically been very volatile.
Stock prices and trading volumes for many biopharmaceutical companies
fluctuate widely for a number of reasons, including factors which may be
unrelated to their businesses or results of operations such as media coverage,
legislation and regulatory measures and the activities of various interest
groups or organizations. This market volatility, as well as general domestic or
international economic, market and political conditions, could materially and
adversely affect the market price of our common stock and the return on your
investment.
Historically, our stock price has been extremely volatile. Between January
1998 and September 30, 2003, our stock has traded as high as $75.88 per share
and as low as $1.41 per share. Between September 1, 2002 and September 30, 2003,
the price has ranged between a high of $16.07 per share and a low of $1.41 per
share. The significant market price fluctuations of our common stock are due to
a variety of factors, including:
o depth of the market for the common stock;
o the experimental nature of our prospective products;
o fluctuations in our operating results;
o market conditions relating to the biopharmaceutical and pharmaceutical
industries;
o any announcements of technological innovations, new commercial products
or clinical progress or lack thereof by us, our collaborative partners or
our competitors; or
o announcements concerning regulatory developments, developments with
respect to proprietary rights and our collaborations.
In addition, the stock market is subject to other factors outside our
control that can cause extreme price and volume fluctuations. Securities class
action litigation has often been brought against companies, including many
biotechnology companies, which then experience volatility in the market price of
their securities. Litigation brought
14
against us could result in substantial costs and a diversion of management's
attention and resources, which could adversely affect our business.
The sale of a substantial number of shares may adversely affect the market price
for our common stock.
Sales of substantial number of shares of our common stock in the public
market could significantly and negatively affect the market price for our common
stock. As of September 30, 2003, we had 33,349,939 shares of common stock
outstanding. Of these shares, approximately 19,651,147 shares were issued
(including shares issuable upon conversion or exercise of convertible notes or
warrants) since December 1998 pursuant to private placements. Of these shares,
approximately 15,174,543 shares have been registered pursuant to shelf
registration statements and therefore may be resold (if not sold prior to the
date hereof) in the public market and approximately 4,476,604 of the remaining
shares may be resold pursuant to Rule 144 into the public markets.
Our undesignated preferred stock may inhibit potential acquisition bids; this
may adversely affect the market price for our common stock and the voting rights
of the holders of common stock.
Our certificate of incorporation provides our Board of Directors with the
authority to issue up to 3,000,000 shares of undesignated preferred stock and to
determine the rights, preferences, privileges and restrictions of these shares
without further vote or action by the stockholders. As of the date of this
prospectus, 50,000 shares of preferred stock have been designated Series A
Junior Participating Preferred Stock and the Board of Directors still has
authority to designate and issue up to 2,950,000 shares of preferred stock. The
rights of the holders of common stock will be subject to, and may be adversely
affected by, the rights of the holders of any preferred stock that may be issued
in the future. The issuance of shares of preferred stock may delay or prevent a
change in control transaction without further action by our stockholders. As a
result, the market price of our common stock may be adversely affected. The
issuance of preferred stock may also result in the loss of voting control by
others.
Provisions in our share purchase rights plan, charter and bylaws, and provisions
of Delaware law, may inhibit potential acquisition bids for us, which may
prevent holders of our common stock from benefiting from what they believe may
be the positive aspects of acquisitions and takeovers.
Our Board of Directors has adopted a share purchase rights plan, commonly
referred to as a "poison pill". This plan entitles existing stockholders to
rights, including the right to purchase shares of common stock, in the event of
an acquisition of 15% or more of our outstanding common stock. Our share
purchase rights plan could prevent stockholders from profiting from an increase
in the market value of their shares as a result of a change of control of Geron
by delaying or preventing a change of control. In addition, our Board of
Directors has the authority, without further action by our stockholders, to
issue additional shares of common stock, to fix the rights and preferences of,
and to issue authorized but undesignated shares of preferred stock.
In addition to our share purchase rights plan and the undesignated
preferred stock, provisions of our charter documents and bylaws may make it
substantially more difficult for a third party to acquire control of us and may
prevent changes in our management, including provisions that:
o prevent stockholders from taking actions by written consent;
o divide the Board of Directors into separate classes with terms of office
that are structured to prevent all of the directors from being elected in
any one year; and
o set forth procedures for nominating directors and submitting proposals
for consideration at stockholders' meetings.
Provisions of Delaware law may also inhibit potential acquisition bids for
us or prevent us from engaging in business combinations. Either collectively or
individually, these provisions may prevent holders of our common stock from
benefiting from what they may believe are the positive aspects of acquisitions
and takeovers, including the potential realization of a higher rate of return on
their investment from these types of transactions.
15
FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated by reference into this
prospectus contain forward-looking statements that are based on current
expectations, estimates and projections about our industry, management's
beliefs, and assumptions made by management. Words such as "anticipates,"
"expects," "intends," "plans," "believes," "seeks," "estimates," and variations
of such words and similar expressions are intended to identify such
forward-looking statements. These statements are not guarantees of future
performance and are subject to certain risks, uncertainties and assumptions that
are difficult to predict; therefore, actual results may differ materially from
those expressed or forecasted in any forward-looking statements. The risks and
uncertainties include those noted in "Risk Factors" above and in the documents
incorporated by reference. We undertake no obligation to update publicly any
forward-looking statements, whether as a result of new information, future
events or otherwise.
USE OF PROCEEDS
We are filing the registration statement of which this prospectus is a part
under our contractual obligation to the holders named in the section entitled
"Selling Stockholder." We will not receive any of the proceeds from the issuance
of shares of our common stock to the selling stockholder or the resale of these
shares by such selling stockholder.
DESCRIPTION OF OUR COMMON STOCK
The following summary is a general description of our common stock.
Complete details can be found in our Charter and Bylaws, copies of which are on
file with the Commission as exhibits to registration statements previously filed
by us. See "Where You Can Find More Information."
We have authority to issue 100,000,000 shares of common stock, $.001 par
value per share. As of September 30, 2003, we had 33,349,939 shares of common
stock outstanding.
The holders of our common stock are entitled to one vote per share on all
matters to be voted upon by the stockholders. Subject to preferences that may be
applicable to any outstanding shares of our preferred stock, the holders of
common stock are entitled to receive ratably such dividends, if any, as may be
declared from time to time by our Board of Directors out of funds legally
available for that purpose. In the event of a liquidation, dissolution or
winding up of the Company, the holders of our common stock are entitled to share
ratably in all assets remaining after payment of liabilities, subject to
preferences applicable to shares of our preferred stock, if any, then
outstanding. The common stock has no preemptive or conversion rights or other
subscription rights. There are no redemption or sinking fund provisions
available to the common stock. All outstanding shares of our common stock are,
and the shares of common stock offered by this prospectus will be, fully paid
and nonassessable.
Transfer Agent and Registrar
The transfer agent and registrar for the common stock is U.S. Stock Transfer
Corporation.
SELLING STOCKHOLDER
The following table sets forth the name of the selling stockholder, the
number of shares of common stock owned beneficially by the selling stockholder
as of September 30, 2003, the number of shares which may be offered pursuant to
this prospectus and the number of shares to be owned by the selling stockholder
after this offering. The selling stockholder may sell up to 31,080 shares of our
common stock pursuant to this prospectus. Since the selling stockholder may
offer all, some or none of its common stock, no definitive estimate as to the
number of shares thereof that will be held by the selling stockholder after the
offering can be provided. In addition, since the date the selling stockholder
provided information regarding its ownership of the shares, it may have sold,
transferred or otherwise disposed of all or a portion of its shares of common
stock in transactions exempt from the registration requirements of the
Securities Act. Information concerning the selling stockholder may change from
time to time and, when necessary, any changed information will be set forth in a
prospectus supplement to this prospectus.
On September 22, 2003, as payment of the first installment of the amount
due to Transgenomic, Inc. ("Transgenomic") under a supply agreement pursuant to
which Transgenomic is manufacturing certain chemicals
16
for use by us in producing our telomerase inhibitor compounds, we issued to
Transgenomic 31,080 shares of our common stock, pursuant to a Common Stock
Purchase Agreement dated as of September 22, 2003.
To our knowledge, Transgenomic has sole voting and investment power with
respect to all shares of common stock beneficially owned by it. This information
is based upon information provided by the selling stockholder.
Maximum Number
of Shares Available
Total Number of Pursuant to this Shares Owned After Percentage
Name Shares Held (1) Prospectus (1) Offering Number (2) (3)
----------------------- ----------------- -------------------- -------------------- ------------
Transgenomic, Inc. 31,080 31,080 31,080 *
-----------------
(1) Based on information available as of September 30, 2003.
(2) Assumes the sale of all shares of common stock offered by this prospectus.
(3) Based on 33,349,939 shares of common stock outstanding as of September 30,
2003.
* Less than 1%
17
PLAN OF DISTRIBUTION
We are registering 31,080 shares of our common stock on behalf of the
selling stockholder. The selling stockholder and any of its pledgees, assignees
and successors-in-interest may, from time to time, sell any or all of the shares
of common stock offered hereby on any stock exchange, market or trading facility
on which the shares are traded or in private transactions. These sales may be at
fixed or negotiated prices. The selling stockholder may use any one or more of
the following methods when selling shares:
o sales on the Nasdaq National Market;
o sales in the over-the-counter market;
o ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;
o block trades in which the broker-dealer will attempt to sell the
shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction;
o purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
o an exchange distribution in accordance with the rules of the
applicable exchange;
o privately negotiated transactions;
o short sales;
o transactions in which broker-dealers agree with the selling
stockholder to sell a specified number of such shares at a stipulated
price per share;
o a combination of any such methods of sale; and
o any other method permitted pursuant to applicable law.
The selling stockholder may also sell the shares directly to market makers
acting as principals and/or broker-dealers acting as agents for themselves or
their customers. These broker-dealers may receive compensation in the form of
discounts, concessions or commissions from the selling stockholder and/or the
purchasers of shares for whom the broker-dealers may act as agents or to whom
they sell as principal or both, which compensation as to a particular
broker-dealer might be in excess of customary commissions. Market makers and
block purchasers purchasing the shares will do so for their own account and at
their own risk. It is possible that the selling stockholder will attempt to sell
shares of common stock in block transactions to market makers or other
purchasers at a price per share which may be below the then market price. The
selling stockholder cannot assure that all or any of the shares offered in this
prospectus will be issued to, or sold by, the selling stockholder. The selling
stockholder and any brokers, dealers or agents, upon effecting the sale of any
of the shares offered in this prospectus, may be deemed "underwriters" as that
term is defined under the Securities Act or the Exchange Act, or the rules and
regulations under such acts.
The selling stockholder, alternatively, may sell all or any part of the
shares offered in this prospectus through an underwriter. To our knowledge, the
selling stockholder has not entered into any agreement with a prospective
underwriter and we cannot assure you that any such agreement will be entered
into. If the selling stockholder entered into this type of an agreement or
agreements, the relevant details will be set forth in a supplement or revisions
to this prospectus.
The selling stockholder and any other persons participating in the sale or
distribution of the shares will be subject to applicable provisions of the
Exchange Act and the rules and regulations under such act, including, without
limitation, Regulation M. These provisions may restrict certain activities of,
and limit the timing of purchases and sales of any of the shares by, the selling
stockholder or any other person. Furthermore, under Regulation M, persons
engaged in a distribution of securities are prohibited from simultaneously
engaging in market making and certain other activities with respect to the
securities for a specified period of time prior to the commencement of the
18
distributions, subject to specified exceptions or exemptions. All of these
limitations may affect the marketability of the shares.
The selling stockholder also may sell all or a portion of its shares in
open market transactions in reliance upon Rule 144 under the Securities Act,
provided they meet the criteria and conform to the requirements of Rule 144.
LEGAL MATTERS
Latham & Watkins LLP will pass on the validity of the issuance of the
shares of common stock offered by this prospectus.
EXPERTS
The consolidated financial statements of Geron Corporation appearing in
Geron's Annual Report (Form 10-K) for the year ended December 31, 2002, have
been audited by Ernst & Young LLP, independent auditors, as set forth in their
report thereon included therein and incorporated herein by reference. Such
consolidated financial statements are incorporated herein by reference in
reliance upon such report given on the authority of such firm as experts in
accounting and auditing.
LIMITATION ON LIABILITY AND DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
Our bylaws provide for indemnification of our directors and officers to the
fullest extent permitted by law. Insofar as indemnification for liabilities
under the Securities Act may be permitted to directors, officers or controlling
persons of Geron pursuant to Geron's Certificate of Incorporation, bylaws and
the Delaware General Corporation Law, Geron has been informed 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.
19
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. We make available free of charge on or through our
Internet website our annual reports on Form 10-K, quarterly reports on Form
10-Q, current reports on Form 8-K and all amendments to those reports as soon as
reasonably practicable after they are electronically filed with, or furnished
to, the Securities and Exchange Commission. Our Internet website address is
"www.geron.com". You may read and copy any document we file at the SEC's public
reference room located at 450 Fifth Street, N.W., Washington, D.C. 20549. Please
call the SEC at 1-800-SEC-0330 for further information on the public reference
room. Our SEC filings are also available to the public at the SEC's website at
http://www.sec.gov. You may also inspect copies of these materials and other
information about us at the offices of the Nasdaq Stock Market, Inc., National
Market System, 1735 K Street, N.W., Washington, D.C. 20006-1500.
DOCUMENTS WE HAVE INCORPORATED BY REFERENCE
The SEC allows us to "incorporate by reference" the information we file
with them which means that we can disclose important information to you by
referring you to those documents instead of having to repeat the information in
this prospectus. The information incorporated by reference is considered to be
part of this prospectus, and later information that we file with the SEC will
automatically update and supersede this information. We incorporate by reference
the documents listed below and any future filings made with the SEC under
Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934 until
the selling stockholder sell all the shares:
o Our annual report on Form 10-K for the fiscal year ended December 31,
2002;
o Our definitive proxy statement filed pursuant to Section 14 of the
Exchange Act in connection with our 2003 Annual Meeting of Stockholder
dated April 13, 2003;
o Our current reports on Form 8-K filed January 22, 2003, April 7, 2003,
April 8, 2003, April 9, 2003, April 30, 2003, May 27, 2003, June 4,
2003, July 1, 2003, July 30, 2003 and September 3, 2003.
o Our quarterly report on Form 10-Q for the quarter ended March 31,
2003;
o Our quarterly report on Form 10-Q for the quarter ended June 30, 2003;
and
o The description of our common stock set forth in our registration
statement on Form 8-A, filed with the Commission on June 13, 1996
(File No. 0-20859).
All documents we file under Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act after the date of this registration statement and prior to the
filing of a post-effective amendment that indicates that all securities offered
have been sold or that deregisters all securities then remaining unsold, shall
be deemed to be incorporated by reference in this registration statement and to
be a part of it from the respective dates of filing those documents. Any
statement contained in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this registration statement to the extent that a statement contained herein
modifies or supersedes that statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this registration statement.
We will furnish without charge to you, on written or oral request, a copy
of any or all of the documents incorporated by reference, including exhibits to
these documents. You should direct any requests for documents to David L.
Greenwood, Chief Financial Officer, Geron Corporation, 230 Constitution Drive,
Menlo Park, California 94025, telephone: (650) 473-7700.
20
31,080 SHARES OF COMMON STOCK
GERON CORPORATION
PROSPECTUS
October 1, 2003
You should rely only on the information contained or incorporated by reference
in this prospectus. We have not authorized anyone to provide you with different
information. You should not assume that the information contained or
incorporated by reference in this prospectus is accurate as of any date other
than the date of this prospectus. We are not making an offer of these securities
in any state where the offer is not permitted.
21
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following sets forth the costs and expenses, all of which shall be
borne by the Registrant, in connection with the offering of the securities
pursuant to this Registration Statement:
Registration Fee $ 35
Accounting Fees and Expenses $ 10,000*
Legal Fees and Expenses $ 10,000*
Miscellaneous $ 1,500*
Total $ 21,535*
* Estimated
Item 15. Indemnification of Directors and Officers.
Section 145(a) of the General Corporation Law of the State of Delaware (the
"DGCL") provides that a Delaware corporation may indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation) by
reason of the fact that such person is or was a director, officer, employee or
agent of the corporation or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation or enterprise,
against expenses, judgments, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the corporation, and, with respect
to any criminal action or proceeding, had no cause to believe his conduct was
unlawful.
Section 145(b) of the DGCL provides that a Delaware corporation may
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action or suit by or in the right of
corporation to procure a judgment in its favor by reason of the fact that such
person acted in any of the capacities set forth above, against expenses actually
and reasonably incurred by such person in connection with the defense or
settlement of such action or suit if he or she acted under similar standards to
those set forth above, except that no indemnification may be made in respect to
any claim, issue or matter as to which such person shall have been adjudged to
be liable to the corporation unless and only to the extent that the court in
which such action or suit was brought shall determine that despite the
adjudication of liability, but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to be indemnified for such
expenses which the court shall deem proper.
Section 145 of the DGCL further provides that to the extent a director or
officer of a corporation has been successful in the defense of any action, suit
or proceeding referred to in subsection (a) and (b) or in the defense of any
claim, issue or matter therein, he shall be indemnified against expenses
actually and reasonably incurred by him in connection therewith; that
indemnification provided for by Section 145 shall not be deemed exclusive of any
other rights to which the indemnified party may be entitled; and that the
corporation may purchase and maintain insurance on behalf of a director or
officer of the corporation against any liability asserted against such officer
or director and incurred by him or her in any such capacity or arising out of
his or her status as such, whether or not the corporation would have the power
to indemnify him or her against such liabilities under Section 145.
As permitted by Section 102(b)(7) of the DGCL, our Certificate of
Incorporation provides that a director shall not be liable to us or our
stockholders for monetary damages for breach of fiduciary duty as a director.
However, this provision does not eliminate or limit the liability of a director
for acts or omissions not in good faith or for breaching his or her duty of
loyalty, engaging in intentional misconduct or knowingly violating the law,
paying a dividend or approving a stock repurchase which was illegal, or
obtaining an improper personal benefit. A provision of this type has no effect
on the availability of equitable remedies, such as injunction or rescission, for
II-1
breach of fiduciary duty. Our Certificate of Incorporation requires that
directors and officers be indemnified to the maximum extent permitted by
Delaware law.
Item 16. Exhibits.
See Exhibit Index.
Item 17. Undertakings.
(a) 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 this 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 and of the
estimated maximum offering price 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; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this registration statement or any
material change to such information in this registration statement;
Provided, however, that subparagraphs (i) and (ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in the periodic reports filed by the Registrant pursuant
to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in this registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each post-effective amendment shall be treated as a new
registration statement of the securities offered, and the offering of the
securities at that time to be deemed the initial bona fide offering.
(3) To file a post-effective amendment to remove from registration any
of the securities that remain unsold at the end of the offering.
(b) 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 section 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
Securities Exchange Act of 1934) 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.
(c) 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 the foregoing provisions, 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 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
II-2
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 Act and will be governed by the final adjudication of such
issue.
II-3
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 Menlo Park, State of California, on October 1, 2003.
GERON CORPORATION
By: /s/ David L. Greenwood
-----------------------------------------------
David L. Greenwood
Senior Vice President and Chief Financial Officer
POWER OF ATTORNEY
KNOW ALL BY THESE PERSONS PRESENT, that the persons whose signatures appear
below do hereby constitute and appoint Thomas B. Okarma, David L. Greenwood, and
William D. Stempel, or any of them, our true and lawful attorneys-in-fact and
agents, each with full power to sign for us or any of us in our names and in any
and all capacities, any and all amendments (including post-effective amendments)
to this Registration Statement, or any related registration statement that is to
be effective upon filing pursuant to Rule 462(b) under the Securities Act of
1933, as amended, and to file the same, with all exhibits thereto and other
documents required in connection therewith with the Securities and Exchange
Commission hereby do ratifying and confirming all that each of said
attorneys-in-fact, or either of them, or his or her substitute or substitutes,
shall do or cause to be done by virtue thereof.
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.
Signature Title Date
--------- ----- ----
/s/ Thomas B. Okarma Chief Executive Officer, October 1, 2003
--------------------------- President and Director
Thomas B. Okarma (principal executive officer)
/s/ David L. Greenwood Senior Vice President and Chief October 1, 2003
--------------------------- Financial Officer
David L. Greenwood (principal financial and accounting
officer)
/s/ Alexander E. Barkas Director October 1, 2003
---------------------------
Alexander E. Barkas
/s/ Edward V. Fritzky Director October 1, 2003
---------------------------
Edward V. Fritzky
/s/ Thomas D. Kiley Director October 1, 2003
---------------------------
Thomas D. Kiley
/s/ John P. Walker Director October 1, 2003
---------------------------
John P. Walker
/s/ Patrick J. Zenner Director October 1, 2003
---------------------------
Patrick J. Zenner
S-1
EXHIBIT INDEX
Exhibits Description
-------- -----------
4.1 Common Stock Purchase Agreement dated September 22, 2003 by and
between Registrant and Transgenomic, Inc.
5.1 Opinion of Latham & Watkins LLP.
23.1 Consent of Latham & Watkins LLP (included in Exhibit 5.1).
23.2 Consent of Ernst & Young LLP, Independent Auditors.
24.1 Power of Attorney (included on the signature page to this
Registration Statement).
Exhibit 4.1
COMMON STOCK PURCHASE AGREEMENT
THIS COMMON STOCK PURCHASE AGREEMENT ("Agreement") is made and entered into
as of September 25, 2003, (the "Effective Date"), by and between GERON
CORPORATION, a Delaware corporation having its principal place of business at
230 Constitution Drive, Menlo Park, California 94025 ("Geron"), and
TRANSGENOMIC, INC., a Delaware corporation having its principal place of
business at 12325 Emmet Street, Omaha, Nebraska 68164 ("Transgenomic").
A. Geron and Transgenomic are the parties to that certain Supply
Agreement dated as of June 15, 2002 (the "Supply Agreement"), and
related Addendum Agreements ("Addendum Agreement") under which Geron
has agreed to purchase certain products from Transgenomic and
Transgenomic has agreed to supply such products to Geron on the terms
set forth therein.
B. Pursuant to Addendum Agreement No. 4 effective September 22, 2003
Geron may pay the purchase price of products by delivery of shares of
Geron's Common Stock (the "Shares").
THE PARTIES AGREE AS FOLLOWS:
1. Issuance of Shares; Adjustments.
1.1 As payment of the First Installment specified in Addendum Agreement
No. 4, Geron will issue and deliver certificates for 31,080 Shares.
Upon issuance and delivery of the certificate(s) for the Shares, all
Shares shall be duly authorized and validly issued and represent fully
paid shares of Geron's Common Stock.
2. Closing; delivery.
2.1 The consummation of the transaction contemplated by this Agreement (a
"Closing") shall be held at such time and place as is mutually agreed
upon between the parties, but in any event no later than three (3)
business days after the Effective Date of Addendum Agreement No. 4
(the "Closing Date"). At the Closing, Geron shall deliver to
Transgenomic one or more certificates representing all of the Shares,
which Shares shall be issued in the name of Transgenomic or its
designee and in such denominations as Transgenomic shall specify.
2.2 Geron's obligations to issue and deliver the stock certificate(s)
representing the Shares to Transgenomic at the Closing shall be
subject to the following conditions, which may be waived by Geron:
2.2.1 the covenants and obligations that Transgenomic is required to
perform or to comply with pursuant to this Agreement, at or prior
to the Closing, must have been duly performed and complied with
in all material respects; and
2.2.2 the representations and warranties made by Transgenomic herein
shall be true and correct in all material respects as of the
Closing Date.
2.3 Transgenomic's obligation to accept delivery of the stock
certificate(s) representing the Shares at the Closing shall be subject
to the following conditions, any one or more of which may be waived by
Transgenomic:
1
2.3.1 the covenants and obligations that Geron is required to perform
or to comply with pursuant to this Agreement, at or prior to the
Closing, must have been duly performed and complied with in all
material respects;
2.3.2 Geron shall have available under its Certificate of
Incorporation sufficient authorized shares of Common Stock to
issue the Shares to Transgenomic; and
2.3.3 the representation and warranties made by the Geron herein shall
be true and correct in all material respects as of any Closing
Date.
3. Restrictions on Resale of Shares.
3.1 Legends. Transgenomic understands and acknowledges that the Shares are
not registered under the Securities Act of 1933 (the "Act"), and that
under the Act and other applicable laws Transgenomic may be required
to hold such Shares for an indefinite period of time. Each stock
certificate representing Shares shall bear the following legends:
"THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). ANY
TRANSFER OF SUCH SECURITIES SHALL BE INVALID UNLESS A
REGISTRATION STATEMENT UNDER THE ACT IS IN EFFECT AS TO SUCH
TRANSFER OR, IN THE OPINION OF COUNSEL REASONABLY ACCEPTABLE
TO GERON, SUCH REGISTRATION IS UNNECESSARY FOR SUCH TRANSFER
TO COMPLY WITH THE ACT. THE SECURITIES REPRESENTED HEREBY ARE
SUBJECT TO THE TERMS OF THE COMMON STOCK PURCHASE AGREEMENT,
DATED SEPTEMBER 22, 2003. A COPY OF THE AGREEMENT CAN BE
OBTAINED FROM THE SECRETARY OF GERON."
3.2 Limits on Sales. Transgenomic agrees that if it decides to resell some
or all of the Shares, it will do so only in an appropriate manner
based upon whether the shares are registered or unregistered, ie. on
the Nasdaq National Market or in a Rule 144A compliant transaction.
Subject to the foregoing restrictions, Transgenomic may sell or resell
the Shares in any lot size, or at any volume, desired by Transgenomic.
2
4. REGISTRATION RIGHTS
4.1 Geron agrees to file with the Securities and Exchange Commission (the
"Commission"), as promptly as practicable and in any event within ten
(10) business days after the Closing Date, a registration statement
under the Act (the "Registration Statement"), on Form S-3 or other
appropriate form, so as to permit a non-underwritten public offering
and resale of the Shares under the Act by Transgenomic. Geron agrees
to diligently pursue making the Registration Statement effective.
Geron will notify Transgenomic of the effectiveness of the
Registration Statement within one (1) business day of receiving notice
from the Commission.
4.2 Geron will maintain the Registration Statement and any post-effective
amendment thereto filed under this Section 4 effective under the Act
until the earliest of (i) the date that none of the Shares covered by
such Registration Statement are issued and outstanding, (ii) the date
that all of the Shares have been sold pursuant to such Registration
Statement, (iii) the date Transgenomic receives an opinion of counsel
to Geron, which counsel shall be reasonably acceptable to
Transgenomic, that the Shares may be sold under the provisions of Rule
144 without limitation as to volume, (iv) the date that all Shares
have been otherwise transferred to persons who may trade such shares
without restriction under the Act, and Geron has delivered a new
certificate or other evidence of ownership for such securities not
bearing a restrictive legend, or (v) the date all Shares may be sold
at any time, without volume or manner of sale limitations pursuant to
Rule 144(k) or any similar provision then in effect under the Act in
the opinion of counsel to Geron, which counsel shall be reasonably
acceptable to Transgenomic.
4.3 Geron, at its expense, shall furnish to Transgenomic with respect to
the Shares registered under the Registration Statement such reasonable
number of copies of the Registration Statement, prospectuses and
preliminary prospectuses in conformity with the requirements of the
Act and such other documents as Transgenomic may reasonably request,
in order to facilitate the public sale or other disposition of all or
any of the Shares by Transgenomic, provided, however, that the
obligation of Geron to deliver copies of prospectuses or preliminary
prospectuses to Transgenomic shall be subject to the receipt by Geron
of reasonable assurances from Transgenomic that Transgenomic will
comply with the applicable provisions of the Act and of such other
securities or blue sky laws as may be applicable in connection with
any use of such prospectuses or preliminary prospectuses.
4.4 All fees, disbursements and out-of-pocket expenses and costs incurred
by Geron in connection with the preparation and filing of the
Registration Statement under Section 4.1 and in complying with
applicable securities and Blue Sky laws (including, without
limitation, all attorneys' fees of Geron) shall be borne by Geron.
Transgenomic shall bear the cost of fees and expenses of
Transgenomic's counsel.
4.5 Geron will advise Transgenomic promptly after it shall receive notice
or obtain knowledge of the issuance of any stop order by the
Commission delaying or suspending the effectiveness of the
Registration Statement or of the initiation of any proceeding for that
purpose, and Geron will use its commercially reasonable efforts to
prevent the issuance of any stop order or to obtain its withdrawal at
the earliest possible moment if such stop order should be issued.
3
4.6 With a view to making available to Transgenomic the benefits of Rule
144 (or its successor rule) and any other rule or regulation of the
Commission that may at the time permit Transgenomic to sell the Shares
to the public without registration, Geron covenants and agrees to: (i)
make and keep public information available, as those terms are
understood and defined in Rule 144, until the earliest of (A) such
date as all of the Shares may be resold pursuant to Rule 144(k) or any
other rule of similar effect or (B) such date as all of the Shares
shall have been resold; and (ii) file with the Commission in a timely
manner all reports and other documents required of Geron under the Act
and under the Exchange Act of 1934, as amended.
4.7 Transgenomic will cooperate with Geron in all respects in connection
with this Agreement, including timely supplying all information
reasonably requested by Geron (which shall include all information
regarding Transgenomic and proposed manner of sale of the Shares
required to be disclosed in any Registration Statement) and executing
and returning all documents reasonably requested in connection with
the registration and sale of the Shares and entering into and
performing their obligations under any underwriting agreement, if the
offering is an underwritten offering, in usual and customary form,
with the managing underwriter or underwriters of such underwritten
offering. Nothing in this Agreement shall obligate Transgenomic to
consent to be named as an underwriter in any Registration Statement.
5. Indemnification.
5.1 Geron agrees to indemnify and hold harmless Transgenomic (and each
person, if any, who controls Transgenomic within the meaning of
Section 15 of the Act, and each officer and director of Transgenomic)
against any and all losses, claims, damages or liabilities (or actions
or proceedings in respect thereof), joint or several, directly or
indirectly based upon or arising out of (i) any untrue statement or
alleged untrue statement of any material fact contained in the
Registration Statement, any preliminary prospectus, final prospectus
or summary prospectus contained therein or used in connection with the
offering of the Shares, or any amendment or supplement thereto, or
(ii) any omission or alleged omission to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; and Geron will reimburse each such indemnified
party for any legal or any other expenses reasonably incurred by them
in connection with investigating, preparing, pursuing or defending any
such loss, claim, damage, liability, action or proceeding, except
insofar as any such loss, claim, damage, liability, action, proceeding
or expense (A) arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in the
Registration Statement, any such preliminary prospectus, final
prospectus, summary prospectus, amendment or supplement in reliance
upon and in conformity with written information furnished to Geron by
Transgenomic or such other person expressly for use in the preparation
thereof, (B) the failure of Transgenomic to comply with its covenants
and agreements contained in Sections 7.1 or 7.5.2 hereof or (C) any
misstatement or omission in any prospectus that is corrected in any
subsequent prospectus that was delivered to Transgenomic prior to the
pertinent sale or sales by Transgenomic. Such indemnity shall remain
in full force and effect, regardless of any investigation made by such
indemnified party and shall survive the transfer of the Shares by
Transgenomic.
4
5.2 Transgenomic agrees to indemnify and hold harmless Geron (and each
person, if any, who controls Geron within the meaning of Section 15 of
the Act, each officer of Geron who signs the Registration Statement
and each director of Geron) from and against losses, claims, damages
or liabilities (or actions or proceedings in respect thereof), joint
or several, directly or indirectly based upon or arising out of, (i)
any failure of Transgenomic to comply with the covenants and
agreements contained in Sections 7.1 and 7.5.2 hereof or (ii) any
untrue statement of a material fact contained in the Registration
Statement or any omission of a material fact required to be stated in
the Registration Statement or necessary in order to make the
statements in the Registration Statement not misleading if such untrue
statement or omission was made in reliance upon and in conformity with
written information furnished to Geron by on behalf of Transgenomic
specifically for use in preparation of the Registration Statement;
provided, however, that Transgenomic shall not be liable in any such
case for (A) any untrue statement or omission in the Registration
Statement, prospectus, or other such document which statement is
corrected by Transgenomic and delivered to Geron prior to the sale
from which such loss occurred, (B) any untrue statement or omission in
any prospectus which is corrected by Transgenomic in any subsequent
prospectus, or supplement or amendment thereto, and delivered to Geron
prior to the sale or sales from which a loss or liability arose, or
(C) any failure by Geron to fulfill any of its obligations under
Section 5.1 hereof.
5.3 Promptly after receipt by any indemnified person of a notice of a
claim or the beginning of any action in respect of which indemnity is
to be sought against an indemnifying person pursuant to this Section
5, such indemnified person shall notify the indemnifying person in
writing of such claim or of the commencement of such action, but the
omission to so notify the indemnifying party will not relieve it from
any liability which it may have to any indemnified party under this
Section 5 (except to the extent that such omission materially and
adversely affects the indemnifying party's ability to define such
action) or from any liability otherwise than under this Section 5.
Subject to the provisions hereinafter stated, in case any such action
shall be brought against an indemnified person, the indemnifying
person shall be entitled to participate therein, and, to the extent
that it shall elect by written notice delivered to the indemnified
party promptly after receiving the aforesaid notice from such
indemnified party, shall be entitled to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified person. After
notice from the indemnifying person to such indemnified person of its
election to assume the defense thereof, such indemnifying person shall
not be liable to such indemnified person for any legal expense
subsequently incurred by such indemnified person in connection with
the defense thereof, provided, however, that if there exists or shall
exist a conflict of interest that would make inappropriate, in the
reasonable opinion of counsel to the indemnified person, for the same
counsel to represent both the indemnified person and such indemnifying
person or any affiliate or associate thereof, the indemnified person
shall be entitled to retain its own counsel at the expense of such
indemnifying person; provided, however, that no indemnifying person
shall be responsible for the fees and expenses of more than on
separate counsel (together with appropriate local counsel) for all
indemnified parties. In no event shall any indemnifying person be
liable in respect to any amounts paid in settlement of any action
unless the indemnifying person shall have approved the terms of such
settlement. No indemnifying person shall, without the prior written
consent of the indemnified person, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified
person is or could have been a party and indemnification could have
been sought hereunder by such indemnified person, unless such
settlement includes an unconditional release of such indemnified
person from all liability on claims that are the subject matter of
such proceeding.
5.4 The provisions of this Section 5 shall survive the termination of this
Agreement.
5
6. Representations and acknowledgement of Geron.
Geron hereby represents, warrants and covenants to Transgenomic as
follow:
6.1 Organization, Good Standing and Qualification. Geron is a corporation
duly organized, validly existing and in good standing under the laws
of the State of Delaware and has all requisite corporate power and
authority to carry on its business as now conducted and as presently
proposed to be conducted. Geron is duly qualified to transact business
and is in good standing as a foreign corporation in each jurisdiction
in which the failure to so qualify would have a material adverse
effect on its business or properties.
6.2 Authorization. All corporate action on the party of Company, its
officers, directors and stockholders necessary for the authorization,
execution and delivery of this Agreement, the performance of all
obligations of Company hereunder and the authorization, issuance and
delivery of the Shares has been taken or will be taken prior to the
Closing, and this Agreement, when executed and delivered will
constitute valid and legally binding obligations of Geron, enforceable
against Geron in accordance with their terms, except as limited by
applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent conveyance and other laws of general application affecting
enforcement of creditors' rights generally, as limited by laws
relating to the availability of specific performance, injunctive
relief or other equitable remedies.
6.3 Valid Issuance of Common Stock. The Shares, when issued, sold and
delivered in accordance with the terms hereof for the consideration
expressed herein, will be duly and validly authorized and issued,
fully paid and nonassessable and free of restrictions on transfer
other than restrictions on transfer under this Agreement and
applicable state and federal securities laws.
6.4 Legal Proceedings and Orders. There is no action, suit, proceeding or
investigation pending or threatened against Geron that questions the
validity of this Agreement or the right of Geron to enter into this
Agreement or to consummate this transactions contemplated hereby, nor
is Geron aware of any basis for any of the forgoing. Geron is neither
a party nor subject to the provisions of any order, writ, injunction,
judgment or decree of any court or government agency or
instrumentality that would affect the ability of Geron to enter into
this Agreement or to consummate the transactions contemplated hereby.
7. Representations and Acknowledgments of Transgenomic.
Transgenomic hereby represents, warrants, acknowledges and agrees that:
7.1 Investment. Transgenomic is acquiring the Shares for Transgenomic's
own account, and not directly or indirectly for the account of any
other person. Transgenomic is acquiring the Shares for investment and
not with a view to distribution or resale thereof, except in
compliance with the Act and any applicable state law regulating
securities.
6
7.2 Access to Information. Transgenomic has consulted with its own
attorney, accountant, or investment advisor as Transgenomic has deemed
advisable with respect to the investment and has determined its
suitability for Transgenomic. Transgenomic has had the opportunity to
ask questions of, and to receive answers from, appropriate executive
officers of Geron with respect to the terms and conditions of the
transactions contemplated hereby and with respect to the business,
affairs, financial condition and results of operations of Geron.
Transgenomic has had access to such financial and other information as
is necessary in order for Transgenomic to make a fully informed
decision as to investment in Geron, and has had the opportunity to
obtain any additional information necessary to verify any of such
information to which Transgenomic has had access. Transgenomic
acknowledges that neither Geron nor any of its officers, directors,
employees, agents, representatives, or advisors have made any
representation or warranty other than those specifically expressed
herein.
7.3 Business and Financial Expertise. Transgenomic further represents and
warrants that it has such business or financial expertise as to be
able to evaluate its investment in Geron and purchase of the Shares.
7.4 Speculative Investment. Transgenomic acknowledges that the investment
in Geron represented by the Shares is highly speculative in nature and
is subject to a high degree of risk of loss in whole or in part; the
amount of such investment is within Transgenomic's risk capital means
and is not so great in relation to Transgenomic's total financial
resources as would jeopardize the personal financial needs of
Transgenomic in the event such investment were lost in whole or in
part.
7.5 Unregistered Securities. Transgenomic acknowledges that:
7.5.1 Transgenomic must bear the economic risk of investment for an
indefinite period of time because the Shares have not been
registered under the Act and therefore cannot and will not be
sold unless they are subsequently registered under the Act or an
exemption from such registration is available. Geron has made no
agreements, covenants or undertakings whatsoever to register any
of the Shares under the Act, except as provided in Section 4
above. Geron has made no representations, warranties or covenants
whatsoever as to whether any exemption from the Act, including,
without limitation, any exemption for limited sales in routine
brokers' transactions pursuant to Rule 144 under the Act, will
become available and any such exemption pursuant to Rule 144, if
available at all, will not be available unless: (i) a public
trading market then exists in Geron's common stock, (ii) Geron
has complied with the information requirements of Rule 144, and
(iii) all other terms and conditions of Rule 144 have been
satisfied.
7.5.2 Transfer of the Shares has not been registered or qualified
under any applicable state law regulating securities and,
therefore, the Shares cannot and will not be sold unless they are
subsequently registered or qualified under any such act or an
exemption therefrom is available. Geron has made no agreements,
covenants or undertakings whatsoever to register or qualify any
of the Shares under any such act. Geron has made no
representations, warranties or covenants whatsoever as to whether
any exemption from any such act will become available.
7.5.3 Transgenomic hereby certifies that it is an "Accredited
Investor" as that term is defined in Rule 501 under the Act.
8. Tax Advice. Transgenomic acknowledges that Transgenomic has not relied
and will not rely upon Geron or Geron's counsel with respect to any tax
consequences related to the ownership, purchase, or disposition of the
Shares. Transgenomic assumes full responsibility for all such
consequences and for the preparation and filing of all tax returns and
elections which may or must be filed in connection with the Shares.
7
9. Notices. Any notice or other communication required or permitted
hereunder shall be in writing and shall be deemed to have been duly
given on the date of delivery if delivered personally or by facsimile,
or one day, not including Saturdays, Sundays, or national holidays,
after sending if sent by national overnight delivery service, or five
days, not including Saturdays, Sundays, or national holidays, after
mailing if mailed by first class United States mail, certified or
registered with return receipt requested, postage prepaid, and
addressed as follows:
To Geron at: Geron Corporation
230 Constitution Drive
Menlo Park, California 94025
Attention: General Counsel
Telephone: (650) 473-7700
Facsimile: (650) 473-7750
To Transgenomic at: Transgenomic, Inc.
12325 Emmet Street
Omaha, Nebraska 68164
Attention: Law Department
Telephone: (402) 452-5400
Facsimile: (402) 452-5447
10. Binding Effect. This Agreement shall be binding upon the heirs, legal
representatives and successors of Geron and of Transgenomic; provided,
however, that Transgenomic may not assign any rights or obligations
under this Agreement.
11. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.
12. Invalid Provisions. In the event that any provision of this Agreement
is found to be invalid or otherwise unenforceable by a court or other
tribunal of competent jurisdiction, such invalidity or unenforceability
shall not be construed as rendering any other provision contained
herein invalid or unenforceable, and all such other provisions shall be
given full force and effect to the same extent as though the invalid
and unenforceable provision was not contained herein.
13. Counterparts. This Agreement may be executed in any number of identical
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
14. Amendments. This Agreement or any provision hereof may be changed,
waived, or terminated only by a statement in writing signed by the
party against whom such change, waiver or termination is sought to be
enforced.
15. Future Cooperation. Each of the parties hereto agrees to cooperate at
all times from and after the date hereof with respect to all of the
matters described herein, and to execute such further assignments,
releases, assumptions, amendments of the Agreement, notifications and
other documents as may be reasonably requested for the purpose of
giving effect to, or evidencing or giving notice of, the transactions
contemplated by this Agreement.
16. Entire Agreement. This Agreement and the Supply Agreement, including
Addendum Agreement No. 4 thereto, constitute the entire agreement of
the parties pertaining to the Shares and supersede all prior and
contemporaneous agreements, representations, and understandings of the
parties with respect thereto.
8
IN WITNESS WHEREOF, the parties hereto have executed this Common Stock
Purchase Agreement as of the date first above written.
Geron Corporation
/s/ William D. Stempel
-------------------------------------------
By: William D. Stempel
Title: Vice President and General Counsel
Secretary
Transgenomic, Inc.
/s/ Michael Draper
-------------------------------------------
By: Michael Draper
Title: Chief Financial Officer
9
Exhibit 5.1
[LATHAM & WATKINS LETTERHEAD]
October 1, 2003
Geron Corporation
230 Constitution Drive
Menlo Park, California 94025
Re: Registration of 31,080 shares of common stock, par value $0.001 per share,
of Geron Corporation, pursuant to a Registration Statement on Form S-3
Ladies and Gentlemen:
In connection with the registration for resale of an aggregate of 31,080
shares of common stock, par value $0.001 per share, of Geron Corporation, a
Delaware corporation (the "Company"), under the Securities Act of 1933, as
amended, on Form S-3 filed with the Securities and Exchange Commission on
October 1, 2003 (the "Registration Statement"), you have requested our opinion
with respect to the matters set forth below. The shares being registered for
resale include an aggregate of 31,080 shares of common stock which were issued
and sold to Transgenomic, Inc. ("Transgenomic") pursuant to a Common Stock
Purchase Agreement dated as of September 22, 2003 by and between the Company and
Transgenomic (the "Shares").
In our capacity as your special counsel in connection with such
registration, we are familiar with the proceedings taken by the Company in
connection with the authorization and issuance of the Shares. In addition, we
have made such legal and factual examinations and inquiries, including an
examination of originals or copies certified or otherwise identified to our
satisfaction of such documents, corporate records and instruments, as we have
deemed necessary or appropriate for purposes of this opinion.
In our examination, we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals, and the conformity
to authentic original documents of all documents submitted to us as copies. As
to facts material to the opinions, statements and assumptions expressed herein,
we have, with your consent, relied upon oral or written statements and
representations of officers and other representatives of the Company and others.
In addition, we have obtained and relied upon such certificates and assurances
from public officials as we have deemed necessary.
We are opining herein as to the effect on the subject transaction only of
the General Corporation Law of the State of Delaware, and we express no opinion
with respect to the applicability thereto, or the effect thereon, of the laws of
any jurisdiction or any other laws or as to any matters of municipal law or the
laws of any local agencies within any state.
Subject to the foregoing, it is our opinion that, as of the date hereof,
the Shares have been duly authorized and are validly issued, fully paid and
nonassessable.
We consent to your filing this opinion as an exhibit to the Registration
Statement and to the reference to our firm contained under the heading "Legal
Matters."
Very truly yours,
/s/ Latham & Watkins
1
Exhibit 23.2
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in
the Registration Statement (Form S-3) and related Prospectus of Geron
Corporation for the registration of 31,080 shares of its common stock and to the
incorporation by reference therein of our report dated February 10, 2003, with
respect to the consolidated financial statements of Geron Corporation included
in its Annual Report (Form 10-K) for the year ended December 31, 2002, filed
with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Palo Alto, California
September 29, 2003