-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Qwd+VyqkJZsE9Yw56ansXcM9lagDQTE3ELrUi/Yh5zuUu4vtgxpaHVMAEX73i/tY qxUeH3Jh/4k/scdT6ugP1A== 0001047469-98-002799.txt : 19980202 0001047469-98-002799.hdr.sgml : 19980202 ACCESSION NUMBER: 0001047469-98-002799 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 19980130 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: IGEN INTERNATIONAL INC /DE CENTRAL INDEX KEY: 0000916304 STANDARD INDUSTRIAL CLASSIFICATION: PATENT OWNERS & LESSORS [6794] IRS NUMBER: 942852543 STATE OF INCORPORATION: CA FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: S-3 SEC ACT: SEC FILE NUMBER: 333-45355 FILM NUMBER: 98518720 BUSINESS ADDRESS: STREET 1: 16020 INDUSTRIAL DRIVE CITY: GAITHERSBURG STATE: MD ZIP: 20877 BUSINESS PHONE: 3019848000 MAIL ADDRESS: STREET 1: 16020 INDUSTRIAL DRIVE CITY: GAITHERSBURG STATE: MD ZIP: 20877 FORMER COMPANY: FORMER CONFORMED NAME: IGEN INC /CA/ DATE OF NAME CHANGE: 19931216 S-3 1 S-3 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 30, 1998. REGISTRATION NO. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 -------------------------- FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 -------------------------- IGEN INTERNATIONAL, INC. (Exact name of registrant as specified in its charter) DELAWARE 2835 94-2852843 (State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer of Classification Code Number) Identification incorporation or organization) Number)
-------------------------- 16020 INDUSTRIAL DRIVE GAITHERSBURG, MARYLAND 20877 (301) 984-6000 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) SAMUEL J. WOHLSTADTER CHIEF EXECUTIVE OFFICER IGEN INTERNATIONAL, INC. 16020 INDUSTRIAL DRIVE GAITHERSBURG, MARYLAND 20877 (301) 984-8000 (Name, address, including zip code, and telephone number, including area code, of agent for service) ------------------------------ WITH A COPY TO: STEPHEN P. DOYLE, ESQ. WILMER, CUTLER & PICKERING 2445 M STREET, N.W. WASHINGTON, D.C. 20037 (202) 663-8000 -------------------------- APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE OF SECURITIES TO THE PUBLIC: From time to time after the effective date of this Registration Statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. /X/ If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / /______ If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. / /______ If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. / / -------------------------- CALCULATION OF REGISTRATION FEE
PROPOSED MAXIMUM PROPOSED MAXIMUM TITLE OF SECURITIES AMOUNT TO OFFERING PRICE AGGREGATE AMOUNT OF TO BE REGISTERED BE REGISTERED (1) PER SHARE (2) OFFERING PRICE REGISTRATION FEE Common Stock, par value $0.001 per share.......... 5,202,004 $16.50 $85,833,066 $25,321
(1) Pursuant to Rule 416 under the Securities Act, this Registration Statement also relates to an indeterminate number of additional shares of Common Stock issuable to prevent dilution resulting from stock splits, stock dividends or similar transactions. (2) Estimated pursuant to Rule 457(c) solely for the purpose of calculating the registration fee, based upon the average of the high and low prices per share of IGEN International, Inc. common stock, par value $.001 per share, on [within 5 business days prior to filing date], as reported on the Nasdaq Stock Market's National Market. -------------------------- THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SUBJECT TO COMPLETION, DATED , 1998 PROSPECTUS IGEN INTERNATIONAL, INC. 5,202,004 SHARES OF COMMON STOCK ------------------ This Prospectus relates to the offering by the Selling Securityholders named herein (the "Selling Securityholders") of up to an aggregate of 5,202,004 shares of common stock, $.001 par value per share (the "Shares" or "Common Stock") of IGEN International, Inc. ("IGEN" or the "Company") issuable upon conversion of the Series B Convertible Preferred Stock of the Company. Of the 5,202,004 shares, 1,790,830 shares are issuable to the Selling Securityholders upon conversion of the 25,000 shares of Series B Convertible Preferred Stock ("Series B Preferred Stock") issued by the Company to the Selling Securityholders. Up to 810,172 shares are issuable to the Selling Securityholders, at the option of the Company, as payment of the dividends due on the Series B Preferred Stock. The Prospectus also covers pursuant to Rule 416 under the Securities Act of 1993, as amended, such indeterminate number of Shares as may be required to effect conversion of the Series B Convertible Preferred Stock to prevent dilution resulting from stock splits, stock dividends or similar transactions. The Shares may be sold from time to time by the Selling Securityholders, or by pledgees or transferees of, or certain successors in interest to Selling Securityholders, in privately negotiated transactions, in brokers' transactions, to market makers or in block placements, at market prices prevailing at the time of sale or at prices otherwise negotiated. See "Selling Securityholders" and "Plan of Distribution." The Company will not receive any of the proceeds from the sale of the shares being sold by the Selling Securityholders. The Company has agreed to bear the expenses incurred in connection with the registration of the Shares, other than underwriting discounts and commissions, fees and expenses of counsel to each Selling Securityholder. The Company's Common Stock is traded on the Nasdaq National Market (the "NNM") under the symbol "IGEN." On January 23, 1998, the last reported sale price of the Common Stock was $16.625 per share, as reported by the NNM. ------------------------ THE SECURITIES TO BE SOLD PURSUANT TO THIS PROSPECTUS HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ------------------------ SEE "RISK FACTORS," BEGINNING ON PAGE 4, FOR INFORMATION THAT SHOULD BE CONSIDERED REGARDING THE SECURITIES OFFERED HEREBY. ------------------------ The date of this Prospectus is . INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE. AVAILABLE INFORMATION The Company is subject to the informational reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission"). Such reports, proxy statements and other information can be inspected and copied at the public reference facilities maintained by the Commission at Room 1024, 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549, and at the following Regional Offices of the Commission: Chicago Regional Office, Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511; and New York Regional Office, 7 World Trade Center, Suite 1300, New York, New York 10048. Copies of such material can be obtained at prescribed rates from the Public Reference Section of the Commission at 450 Fifth Street, N.W. Judiciary Plaza, Washington, D.C. 20549. Such reports and other information can also be reviewed through the Commission's Electronic Data Gathering, Analysis and Retrieval System ("EDGAR") which is publicly available through the Commission's Web site (http://www.sec.gov). In addition, the Company's Common Stock is listed on the Nasdaq Stock Market's National Market System, and material filed by the Company can be inspected at the offices of the National Association of Securities Dealers, Inc., 1735 K Street, N.W., Washington, D.C. 20006. Additional information regarding the Company and the shares offered hereby is contained in the Registration Statement on Form S-3 and the exhibits thereto filed with the Commission under the Securities Act of 1933, as amended (the "Securities Act"). As permitted by the rules and regulations of the Commission, this Prospectus does not contain all of the information contained in such Registration Statement and the exhibits and schedules thereto. Statements contained in the Prospectus regarding the contents of any document or contract may be incomplete and, in each instance, reference is made to the copy of such contract or document filed as an exhibit to the Registration Statement. For further information pertaining to the Company and the shares, reference is made to the Registration Statement and the exhibits thereto, which may be inspected without charge at the offices of the Commission or on EDGAR, and copies thereof may be obtained at prescribed rates from the Public Reference Section of the Commission at the address set forth above. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents filed by the Company with the Commission pursuant to the Exchange Act are incorporated by reference in and made a part of this Prospectus: (1) the Annual Report on Form 10-K for the fiscal year ended March 31, 1997; (2) the Amendment to the Annual Report on Form 10-K/A for the fiscal year ended March 31, 1997; (3) the Quarterly Reports on Form 10-Q for the quarterly periods ended December 31, 1996, June 30, 1997 and September 30, 1997; and (4) the description of the Company's Common Stock set forth in the Company's Registration Statement on Form 8-A filed with the Commission on January 20, 1994. All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus and prior to the termination of the offering shall be deemed to be incorporated by reference herein and to be a part of this Prospectus from the date of filing of such 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 Prospectus to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. Copies of all documents which are incorporated herein by reference (not including the exhibits to such documents, unless such exhibits are specifically incorporated by reference into such documents or into this Prospectus) will be provided without charge to each person, including any beneficial owner, to whom this Prospectus is delivered, upon a written or oral request to IGEN International, Inc., Attention: George V. Migausky, Chief Financial Officer, 16020 Industrial Drive, Gaithersburg, MD 20877, telephone number (301) 984-8000. 2 RISK FACTORS In evaluating an investment in the Common Stock, prospective purchasers should carefully consider the following factors as well as the other matters discussed in this Prospectus and the documents incorporated herein by reference. RELIANCE ON COLLABORATIONS AND LICENSE AGREEMENTS The Company has entered into collaborative research or licensing agreements with Boehringer Mannheim, Organon Teknika and Eisai pursuant to which these companies are entitled to certain product manufacturing and marketing rights. Some of these companies have the responsibility for additional development and, where required, the submission of applications for the regulatory approval of any products to the U.S. Food and Drug Administration ("FDA") and corresponding regulatory agencies in other countries. Although the Company believes that its partners in these collaborations have an economic motivation to succeed in performing their contractual responsibilities, the amount and timing of resources to be devoted to these activities are not within the control of the Company. There can be no assurance that such collaborators will perform their obligations as expected or that the company will derive any additional revenue from such arrangements. The Company is currently involved in litigation against Boehringer Mannheim. Moreover, the collaboration agreements may be terminated under certain circumstances. See "Recent Developments." The Company also expects to rely on additional collaboration or license agreements to develop and commercialize certain future products. There can be no assurance that the Company will be able to negotiate acceptable collaboration or license agreements in the future, or that such new agreements or existing agreements will be successful. In addition, there can be no assurance that the parties to collaboration or license agreements will not pursue alternative technologies as a means for developing diagnostic products targeted by the collaborations or licenses. EARLY STAGE OF DEVELOPMENT; ACCUMULATED LOSSES The Company is at an early stage of development and is subject to all of the risks inherent in the establishment of a new business enterprise, including the need for substantial capital to support the expenses of developing new technologies, the need to attract and retain qualified management and scientific staff and other risks as outlined in the following risk factors. Since inception, the Company has been engaged in the research and development of products based on new technologies, and at September 30, 1997, the Company had an accumulated deficit of approximately $61 million. The Company's operations may be affected by problems frequently encountered in connection with the development and utilization of new technologies and by the competitive environment in which the Company operates. Although certain ORIGEN-based products have been developed and introduced to the market, there can be no assurance that the ORIGEN technology will be successfully applied to the development of additional commercial products for the clinical diagnostic or other markets. Diagnostic products resulting from the development of the Company's technology will require significant additional development and investment prior to their commercialization. There can be no assurance that products will be successfully developed by the Company or its licensees, meet applicable regulatory standards, be capable of being manufactured in commercial quantities at reasonable costs or be marketed successfully. TECHNOLOGICAL CHANGE AND COMPETITION The diagnostic industry is subject to technological change. Competition from diagnostic and pharmaceutical companies and research and academic institutions is intense and expected to increase. There can be no assurance that the Company's competitors will not succeed in developing products that are more effective than any which are being developed by the Company and its collaborators or which would render the ORIGEN technology and products obsolete and non-competitive. 3 Many of the Company's competitors in the diagnostic field have substantially greater financial, technical and human resources than the Company. In addition, many of these competitors have significantly greater experience than the Company in obtaining regulatory approvals of new diagnostic products. Accordingly, the Company's competitors may succeed in obtaining FDA approval for products more rapidly than the Company. Furthermore, as the Company expands commercial sales of products, it will have to become competitive with respect to manufacturing efficiency and marketing capabilities, areas in which it has limited experience. COMPLIANCE WITH GOVERNMENT REGULATIONS The production and marketing of the Company's products and its ongoing research and development activities are subject to regulation by governmental authorities in the United States and other countries. Diagnostic systems utilizing the Company's ORIGEN technology will require government clearance before being marketed in the United States and in certain foreign countries. In the United States, the Company or its marketing collaborators may be required to submit test data from clinical trials to establish "substantial equivalence" of the ORIGEN diagnostic system with previously approved systems. In such case, the Company or its collaborators may commence sales only after the FDA has issued a written order finding such substantial equivalence, which may take longer than the 90-day period generally provided for FDA review. There can be no assurance that the Company or its collaborators will be able to establish substantial equivalence for the ORIGEN diagnostic systems, or that the FDA or certain corresponding government agencies will permit marketing of such systems in their respective jurisdictions. Should the Company fail to demonstrate substantial equivalence, the Company would need to perform extensive clinical testing to demonstrate safety and efficacy, incurring substantial costs and delays. Even if regulatory approval is obtained, a marketed product, its manufacturer and its manufacturing facilities are subject to continual review and periodic inspections. The regulatory standards for manufacturing are currently being applied stringently by the FDA. Discovery of previously unknown problems with a product, manufacturer or facility may result in restrictions on such product or manufacturer, including costly recalls or even withdrawal of the product from the market. The Company is also subject to numerous environmental and safety laws and regulations, including those governing use of hazardous materials. Any violation of, and the cost of compliance with, these regulations could adversely impact the Company's operations. RELIANCE ON PATENTS AND PROPRIETARY RIGHTS The Company's success will depend in part on its ability to obtain and maintain patent protection for its products, both in the United States and other countries. The patent position of diagnostic companies is highly uncertain and involves complex legal and factual questions. There is no consistent policy regarding the breadth of claims allowed in medical patents. The Company owns or co-owns and has been granted exclusive rights to 18 issued U.S. patents and 69 pending U.S. applications in the diagnostics field. Worldwide, the Company owns or co-owns and has been granted exclusive rights to an additional 54 issued patents, and 150 pending patent applications covering the same technology. There can be no assurance that patents will issue from any present or future applications or that, as to existing patents or patents which may issue, claims are or will be sufficiently broad to protect the Company's technology. In addition, there can be no assurance that the patents issued to the Company will not be challenged, invalidated or circumvented, or that the rights granted thereunder will provide proprietary protection to the Company. The commercial success of the Company will also depend in part on its neither infringing patents issued to competitors nor breaching the technology licenses upon which the Company's products might be based. The Company is a licensee under certain patents and patent applications that it considers necessary for its business. While the Company is aware of additional third-party patents and patent applications relating to specific reagents, it is uncertain whether any of these will require the Company to alter any products or processes, obtain licenses or cease certain development activities with respect to these 4 reagents. There can be no assurance that the Company will be able to obtain necessary licenses at reasonable cost. Failure by the Company to obtain a license to any technology that it requires to commercialize its products may have a material adverse impact on the Company. Litigation, which could result in substantial costs to the Company, may also be necessary to enforce any of its patent rights or to determine the scope and validity of others' proprietary rights. In addition, the Company may have to participate in interference proceedings declared by the U.S. Patent and Trademark Office, which could result in substantial costs to the Company to determine the priority of inventions. IGEN also protects its proprietary technology and processes in part by confidentiality agreements with its collaborative partners, employees, consultants and other advisors. There can be no assurance that these agreements will not be breached, that the Company will have adequate remedies for any breach or that the Company's trade secrets will not otherwise become known or be independently discovered by competitors. UNCERTAINTY OF PRICING, THIRD-PARTY REIMBURSEMENT AND RELATED MATTERS The Company's business, financial condition and results of operations may be materially adversely affected by the continuing efforts of government and third party payors to contain or reduce the costs of health care through various means. For example, in certain foreign markets pricing and profitability of diagnostic products are subject to government control. In the United States, the Company expects that there will continue to be a number of federal and state proposals to implement similar government control. In addition, increasing emphasis on managed care in the United States will continue to put pressure on the pricing of diagnostic tests. Cost control initiatives could decrease the price that the Company or any of its strategic partners receives for any products in the future and have a material adverse effect on the Company's business, financial condition and results of operations. Further, to the extent that cost control initiatives have a material adverse effect on the Company's strategic partners, the Company's ability to commercialize its products and to realize royalties may be adversely affected. The ability of the Company and any strategic partner to commercialize diagnostic products may depend in part on the extent to which reimbursement for the products will be available from government and health administration authorities, private health insurers and other third party payors. Significant uncertainty exists as to the reimbursement status of newly approved health care products. Third party payors, including Medicare, increasingly are challenging the prices charged for medical products and services. Government and other third party payors are increasingly attempting to contain health care costs by limiting both coverage and the level of reimbursement for new products. There can be no assurance that any third party insurance coverage will be available to patients for any products developed by the Company or its strategic partners. If adequate coverage and reimbursement levels are not provided by government and other third party payors for the Company's products, the market acceptance of these products may be reduced, which may have a material adverse effect on the Company's business, financial condition and results of operations. LIMITED MANUFACTURING, SALES, MARKETING AND DISTRIBUTION EXPERIENCE The Company's clinical diagnostic products must be manufactured in commercial quantities in compliance with regulatory requirements and at acceptable costs. The Company has no experience in large scale manufacturing and currently lacks the capability to manufacture its diagnostic products in accordance with regulatory requirements. If the Company is unable to develop or contract for manufacturing capabilities on acceptable terms, the Company's ability to manufacture products will be adversely affected, resulting in the delay of submission of products for regulatory approval, which in turn could adversely affect the Company's competitive position and financial condition. The Company also has limited experience in sales, marketing and distribution. To market any of its clinical diagnostic products directly, the Company must develop a substantial marketing and sales force with technical expertise and supporting distribution capability. Alternatively, the Company may obtain the assistance of established companies, as 5 it has done with certain of its diagnostic products. There can be no assurance that the Company will be able to establish sales and distribution capabilities or that it or its collaborators will be successful in gaining market acceptance for its clinical diagnostics products. FUTURE CAPITAL NEEDS; UNCERTAINTY OF ADDITIONAL FUNDING The Company may require substantial additional funds to conduct the research and development and regulatory testing of its products, to establish commercial scale manufacturing facilities and to market its products. The Company's future capital requirements will depend on many factors, including, but not limited to: continued progress in the development of diagnostic products; the time and costs involved in obtaining regulatory approvals; the costs involved in filing, prosecuting and enforcing patent claims; competing technological and market developments; the ability of the Company to maintain its existing, and to establish new, collaborative and licensing arrangements; the cost of manufacturing scale-up; and effective commercialization activities and arrangements. The Company may be required to seek additional funding either through collaborative and licensing arrangements or through public or private debt or equity financings. There can be no assurance that additional financing will be available in a timely manner or on acceptable terms. If additional funds are raised by issuing equity securities, further dilution to existing shareholders may result. If adequate funds are not available, the Company may be required to delay, scale back or eliminate one or more of its programs or obtain funds through arrangements with collaborative partners or others that may require the Company to relinquish rights to certain of its technologies, product candidates or products that the Company would not otherwise relinquish. NEED TO ATTRACT AND RETAIN KEY EMPLOYEES AND CONSULTANTS The Company is highly dependent on the principal members of its scientific and management staff, the loss of whose services might impede the achievement of its research and development or strategic objectives. Recruiting and retaining qualified scientific personnel to perform research and development work in the future will also be critical to the Company's success. There can be no assurance that the Company will be able to attract and retain such personnel given the competition between numerous diagnostic and biotechnology companies and research and academic institutions for experienced scientists. The Company's anticipated growth and expansion into areas and activities requiring additional expertise, such as clinical trials, government approvals, manufacturing and marketing, are expected to place increased demands on the Company's resources. These demands are expected to require the addition of new management personnel and the development of additional expertise by existing management personnel. The failure to acquire needed personnel or to develop needed expertise could have a material adverse effect on the Company's prospects for success. In addition, the Company relies on consultants and advisors to assist in formulating its research and development strategy. All of the Company's consultants and advisors are employed by entities other than the Company and may have commitments to or consulting or advisory contracts with other entities that may affect their ability to contribute to the Company. RISK OF PRODUCT LIABILITY; AVAILABILITY OF INSURANCE The Company's business will in the future expose it to potential liability risks that are inherent in the testing, manufacturing and marketing of diagnostic products. The Company presently has only limited product liability insurance, and there can be no assurance that it will be able to maintain such insurance or obtain additional insurance on acceptable terms or that insurance will provide adequate coverage against potential liabilities. 6 ANTI-TAKEOVER PROVISIONS The Company's Certificate of Incorporation and Bylaws require that any action required or permitted to be taken by stockholders of the Company must be effected at a duly called annual or special meeting of stockholders and may not be effected by written consent. Special meetings of the stockholders of the Company may be called only by the Board of Directors, the Chairman of the Board or the President of the Company. These and other charter provisions may discourage certain types of transactions involving an actual or potential change in control of the Company, including transactions in which the stockholders might otherwise receive a premium for their shares over then current prices, and may limit the ability of the stockholders to approve transactions they may deem to be in their best interests. In addition, the Board of Directors has the authority, without action by the stockholders, to fix the rights and preferences of and to issue shares of Preferred Stock, which also my have the effect of delaying or preventing a change in control of the Company. PRICE VOLATILITY IN PUBLIC MARKET The Company's Common Stock currently trades on the NASDAQ National Market. The securities markets have from time-to-time experienced significant price and volume fluctuations that may be unrelated to the operating performance of particular companies. In addition, the market prices of the common stock of many publicly traded technology companies have in the past been, and can in the future be expected to be, especially volatile. Announcements of technological innovations or new products of the Company or its competitors, developments or disputes concerning patents or proprietary rights, publicity regarding actual or potential medical results relating to products under development by the Company or its competitors, regulatory developments in both the U.S. and foreign countries, and economic and other external factors, as well as period-to-period fluctuations in the Company's operating and product development results, may have a significant impact on the market price of the Company's Common Stock. CONTROL BY EXISTING SHAREHOLDERS The Company's directors, officers and their affiliates own beneficially approximately 36% of the outstanding shares of Common Stock, of which approximately 27% is held by the Company's Chief Executive Officer. Accordingly, the Company's officers and directors, if they act in concert, will have the ability to influence significantly the election of the Company's directors and most other shareholder actions. ABSENCE OF DIVIDENDS, DILUTION The Company has not paid any cash dividends since its inception and does not intend to pay any cash dividends in the foreseeable future. Dilution will occur upon the exercise of outstanding stock options of the Company and may occur upon future equity financings of the Company. 7 THE COMPANY IGEN develops, manufactures and markets diagnostic systems utilizing its patented ORIGEN-Registered Trademark- technology, which is based on electrochemiluminescence. This proprietary technology utilizes labels that, when attached to a biological substance and electrochemically stimulated, emit light at a particular wavelength to signal the presence of an analyte. The light emission then can be measured with a high degree of accuracy to detect and quantify the analyte. The ORIGEN technology thus provides a uniform assay format for conducting a multitude of diagnostic tests, including immunoassays, nucleic acid probe and clinical chemistry tests. The Company believes that ORIGEN-based diagnostic systems offer significant advantages over existing systems in terms of speed, sensitivity, flexibility, throughput and cost effectiveness. The Company is designing its diagnostic systems to become the industry standard for all segments of the diagnostic market, from large central laboratories to patient point-of-care, industrial and in-home testing. The Company's business strategy is to commercialize certain products in collaboration with established healthcare and information technology companies and to develop and market other products either independently or with corporate partners in the patient point-of-care, life science research, animal health and industrial markets. Collaborations with established diagnostic and pharmaceutical companies have provided the Company with revenues from licensing agreements, as well as access to large marketing organizations that it believes are well positioned to maximize market penetration of ORIGEN-based products. The Company has entered into several strategic alliances, including: - Boehringer Mannheim GmbH ("Boehringer Mannheim")--the second largest worldwide manufacturer of diagnostic equipment and supplies that is part of Corange Limited ("Corange"), a multinational corporation with annual revenues exceeding $4 billion--to commercialize ORIGEN-based clinical immunodiagnostic and nucleic acid probe systems that are marketed worldwide to clinical references laboratories. IGEN received $50 million in license fees from Boehringer Mannheim and receives royalties on all product sales. Boehringer Mannheim presently markets two ORIGEN-based systems under the Elecsys product line. In May 1997, F. Hoffman-LaRoche AG ("Roche") and Corange announced that Roche would acquire all shares of Corange. The merger, when completed, will create a $15 billion global company that will be the world's largest diagnostic supplier. - Organon Teknika B.V. ("Organon Teknika")--a company specializing in hospital and blood bank products, which is a business unit of Akzo Nobel N.V., a multinational corporation with annual revenues of approximately $10 billion--to develop and commercialize ORIGEN-based nucleic acid probe systems that will be marketed worldwide to clinical diagnostic and life science research markets. The Company received $20 million under its agreements with Organon Teknika and receives royalties on product sales. Organon Teknika markets the NASBA QR System together with test kits for the detection of HIV-1 RNA. - Eisai Co., Ltd. ("Eisai")--the fourth largest Japanese pharmaceutical company--to market in Japan an ORIGEN-based diagnostic system for agreed-upon diagnostic tests. During 1997, Eisai began marketing an ORIGEN-based immunoassay system under the name Picolumi and the Company receives royalties on product sales. The Company currently sells the ORIGEN Detection System and related reagents and services for life science research applications. The Company believes that its ORIGEN Detection System can replace many of the complex and less sensitive immunoassay methods presently in use, including radioimmunoassays. The Company believes that applications of the ORIGEN technology include point-of-care diagnostic systems for use outside the central laboratory because of speed, simplicity and cost effectiveness and anticipates that applications will exist in the field of in-home testing (patient self-testing), in which the 8 Company's technology may enable the creation of compact, inexpensive diagnostic products. The Company is currently monitoring the development of healthcare communication networks and intends to design its point-of-care and in-home testing systems for integration into such networks. IGEN, Inc. was incorporated in California in 1982 and reincorporated in Delaware during 1996 as IGEN International, Inc. IGEN's executive offices, laboratory and manufacturing operations are located at 16020 Industrial Drive, Gaithersburg, Maryland 20877, (301) 984-8000. RECENT DEVELOPMENTS On September 15, 1997, the Company filed a lawsuit in Maryland against Boehringer Mannheim GmbH ("BMG"), a German company to which the Company has licensed certain rights to develop and commercialize diagnostic products based on ORIGEN technology. That lawsuit is pending in the Southern Division of the United States District Court for the District of Maryland. The Company's dispute with BMG arises out of a 1992 License and Technology Development Agreement (the "Agreement"), pursuant to which BMG developed and launched its "Elecsys" line of diagnostic products, which is based on the Company's ORIGEN technology. The Company alleges that BMG has failed to perform certain material obligations under the Agreement, including development and commercialization of ORIGEN technology according to the contractual timetable; exploitation of the license to the extent contemplated by the parties; phase out of certain non-royalty-bearing product lines; exploitation of ORIGEN technology only within BMG's licensed fields; proper treatment of intellectual property rights regarding ORIGEN technology; maintenance of records essential to the computation of royalties; and proper computation of royalties. In its lawsuit, the Company seeks damages as well as injunctive and declaratory relief, including a judicial determination of its entitlement to terminate the Agreement. On September 15, 1997, shortly after the Company filed its lawsuit in Maryland, BMG filed a lawsuit in the United States District Court for the Southern District of Indiana seeking a declaration that it did not breach the Agreement and a preliminary injunction precluding the Company from terminating the Agreement pending the judicial resolution of the dispute between the parties. In addition, BMG sought and obtained a temporary restraining order that precluded the Company from terminating the Agreement; IGEN has agreed to the continuation of the temporary restraining order until BMG's motion for preliminary injunction can be adjudicated. On January 26, 1998, the United States District Court for the District of Maryland ruled that the litigation between the Company and BMG will go forward in Maryland. The Company expects that BMG's Indiana action will be dismissed or consolidated with the Maryland action. In December 1997, IGEN International K.K., a Japanese subsidiary of the Company, filed a lawsuit in Tokyo District Court against Hitachi Ltd. ("Hitachi"). This lawsuit seeks to enjoin Hitachi from manufacturing, using or selling the Elecsys 2010 immunoassay instrument in Japan. The lawsuit also seeks to enjoin Hitachi from infringing the subsidiary's license registration, known in Japan as a "senyo-jisshi-ken," in connection with the development of the Mosys instrument. Hitachi is the sole manufacturer for Boehringer Mannheim of the Elecsys 2010 immunoassay instrument. Boehringer Mannheim sells the Elecsys 2010 worldwide to hospitals and clinical reference laboratories. Hitachi is also developing for Boehringer Mannheim the Mosys instrument. The Company's Japanese subsidiary alleges that both the Elecsys 2010 and the Mosys are based on ORIGEN technology. The Company's ORIGEN technology is licensed to its Japanese subsidiary and to Eisai K.K. pursuant to a "senyo-jisshi-ken." The Company's Japanese subsidiary further alleges that Hitachi's manufacturing and selling of the Elecsys 2010 and the development of Mosys violate the "senyo-jisshi-ken." The lawsuit requests injunctive relief against Hitachi and destruction of the Elecsys 2010 and Mosys instruments in Hitachi's possession. USE OF PROCEEDS The Company will not receive any of the proceeds from the sale of the Shares by the Selling Securityholders. 9 SELLING SECURITYHOLDERS The Selling Securityholders collectively purchased 25,000 shares of Series B Convertible Preferred Stock, stated value $1,000 per share, from the Company on December 19, 1997. The Series B Convertible Preferred Stock entitles its holders to a dividend payment of 7.75% compounded annually on the stated value of the stock. Based on the stated value, the Series B Convertible Preferred Stock is convertible into Common Stock of the Company in accordance with the terms of the Certificate of Designation, Powers, Preferences and Rights at a rate of $13.96 per Share, for a total of 1,790,830 Shares. In addition, the Company may elect to make the dividends payable upon the Series B Convertible Preferred Stock in Shares at a rate of $13.96 per Share, rather than making the dividend payment in cash. If the Company elects to pay such dividends in Shares, the Company may issue up to 810,172 Shares to the Selling Securityholders. The Prospectus also covers, pursuant to Rule 416 under the Securities Act, such indeterminate number of Shares as may be required to prevent dilution resulting from stock splits, stock dividends or similar transactions. The following table sets forth certain information regarding ownership of Shares by the Selling Securityholders as of December 31, 1997 and the number of Shares which may be offered for the accounts of the Selling Securityholders or their transferees or distributees from time to time. Because the Selling Securityholders may sell all or any part of their shares registered pursuant to this Prospectus, no estimate can be given as to the number of share that will be held by the Selling Securityholders upon termination of this Offering. None of the Selling Securityholders has, or within the past three years, has had, any position, office or other material relationship with the Company or any of its predecessors or affiliates except as set forth below.
NUMBER OF SHARES NUMBER OF SHARES OWNED WHICH MAY BE SOLD PRIOR TO IN THIS SELLING STOCKHOLDER OFFERING(1) OFFERING(2) - --------------------------------------------------------------------------- ------------------ ----------------- The Robertson Stephens Black Bear Fund, L.P................................ 266,342 The Robertson Stephens Black Bear Offshore Fund, L.P....................... 68,943 The Robertson Stephens Black Bear Pacific Master Fund Unit Trust........... 33,812 Credit Suisse First Boston Corporation..................................... 208,079 Permal Noscal, Ltd......................................................... 312,099 312,099 Zaxis Partners, L.P........................................................ 39,014 39,014 Sidney Kimmel.............................................................. 25,489 25,489 Pollat, Evans & Co. Inc.................................................... 8,842 8,842 Quadra Appreciation Fund, Inc.............................................. 3,641 3,641 Peter W. Branagh & Ramona Y. Branagh Trustee for the Peter W. Branagh & Ramona Y. Branagh Revocable Trust, dated March 8, 1993................... 1,040 1,040 KA Investments LDC......................................................... 208,079 Gleneagles................................................................. 13,004 13,004 Colonial Penn.............................................................. 13,004 13,004 Putnam Health Sciences Trust............................................... 416,159 Porter Partners, L.P....................................................... 130,049 130,049 EDJ Limited................................................................ 26,009 26,009 White Rock Capital Offshore, Ltd........................................... 62,423 62,423 Quantum Partners LDC....................................................... 873,600 260,100 Collins Capital Diversified Fund, L.P...................................... 132,115 41,615 White Rock Capital Partners, L.P........................................... 194,539 104,039 Prism Partners I........................................................... 156,059 GPZ Trading................................................................ 52,019 52,019 Triton Capital Investments................................................. 78,029 JMG Capital Partners, L.P.................................................. 78,029 78,029
10 - ------------------------ (1) The number of shares of Common Stock owned by each Selling Securityholder prior to the Offering includes the shares which may be sold in this Offering, together with all other shares of Common Stock owned by each such Selling Securityholder on December 31, 1997. (2) The number of shares for each Selling Securityholder is based on the conversion of the Series B Convertible Preferred Stock owned by such Selling Securityholder on December 31, 1997 and the payment of dividends in the form of Shares by the Company for the full term of the Series B Convertible Preferred Stock at a rate of $13.96 per Share of Common Stock. The actual rate of conversion and dividend payment may vary in accordance with the terms and conditions of the Series B Convertible Preferred Stock. PLAN OF DISTRIBUTION The Selling Securityholders have advised the Company that the Shares may be sold or distributed from time to time by the Selling Securityholders, or by pledgees, donees or transferees of, or other successors in interest to, the Selling Securityholders, directly to one or more purchasers (including pledgees) or through brokers, dealers or underwriters who may act solely as agents or may acquire Shares as principals, at market prices prevailing at the time of sale, at prices related to such prevailing market prices, at negotiated prices, or at fixed prices, which may be changed. The distribution of the Shares may be effected by one or more of the following methods: (i) ordinary brokers' transactions, which may include long or short sales; (ii) transactions involving cross or block trades or otherwise on the Nasdaq National Market; (iii) purchases by brokers, dealers or underwriters as principals and resale by such purchasers for their own accounts pursuant to this Prospectus; (iv) "at the market" to or through market makers or into an existing market for the Common Stock; (v) in other ways not involving market makers or established trading markets, including direct sales to purchasers or sales effected through agents; (vi) through transactions in options, swaps or other derivatives (whether exchange-listed or otherwise); or (vii) any combination of the foregoing, or by any other legally available means. In addition, the Selling Securityholders or their successors in interest may enter into hedging transactions with broker-dealers who may engage in short sales of Common Stock in the course of hedging the positions they assume with the Selling Securityholders. The Selling Securityholders or their successors in interest may also enter into option or other transactions with broker-dealers that require the delivery to such broker-dealers of the Shares, which Shares may be resold thereafter pursuant to this Prospectus. Brokers, dealers, underwriters or agents participating in the distribution of the Shares as agent may receive compensation in the form of discounts, concessions or commissions from the Selling Securityholders (and, if they act as agent for the purchaser of such Shares, from such purchaser). Such discounts, concessions or commissions as to a particular broker, dealer, underwriter or agent might be greater or less than those customary in the type of transaction involved. The Selling Securityholders and any brokers, dealers, underwriters or agents that participate in the distribution of the Shares may be deemed to be "underwriters" within the meaning of the Securities Act, and any discounts, commissions or concessions received by any such persons might be deemed to be underwriting discounts and commissions under the Securities Act. Neither the Company nor the Selling Securityholders can presently estimate the amount of such compensation. The Company knows of no existing arrangements between any Selling Securityholder and any other Securityholder, broker, dealer, underwriter or agent relating to the sale or distribution of the Shares. To the extent required, the Company will file, during any period in which offers or sales are being made, a supplement to this Prospectus which sets forth, with respect to a particular offering, the specific number of Shares to be sold, the name of the Selling Securityholder, the sales price, the name of any participating broker, dealer, underwriter or agent, any applicable commission or discount and any other material information with respect to the plan of distribution not previously disclosed. 11 The Company will not receive any of the proceeds from the sale of the Shares offered hereby. The Company will pay substantially all of the expenses incident to this Offering of the Shares by the Selling Securityholders to the public other than commissions and discounts of brokers, dealers, underwriters or agents. The Company has agreed to indemnify the Selling Securityholders and certain related persons against certain liabilities, including certain liabilities under the Securities Act. In order to comply with certain states' securities laws, if applicable, the Shares will be sold in such jurisdictions only through registered or licensed brokers or dealers. In addition, in certain states the Common Stock may not be sold unless the Common Stock has been registered or qualified for sale in such state or an exemption from registration or qualification is available and is satisfied. Pursuant to the Registration Rights Agreement between the Company and the Selling Securityholders, the Company has agreed to file with the Commission a Registration Statement on Form S-3 under Rule 415 covering the resale of at least 200% of the Shares issuable to the Selling Securityholders upon conversion of and payment of dividends upon the Series B Convertible Preferred Stock. The Company has agreed to use its best efforts to cause the Registration Statement to become effective as soon as practicable following the filing of the Registration Statement, but in any event not later than March 16, 1998. LEGAL MATTERS The legality of issuance of the shares will be passed upon for the Company by Wilmer, Cutler & Pickering, Washington, D.C. EXPERTS The financial statements incorporated in this Prospectus by reference from the Company's Annual Report on Form 10-K for the year ended March 31, 1997 have been audited by Deloitte & Touche, LLP, independent auditors, as stated in their report, which is incorporated herein by reference, and has been so incorporated in reliance upon the report of such firm given upon their authority as experts in accounting and auditing. 12 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY UNDERWRITER. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY THE SHARES OF COMMON STOCK BY ANYONE IN ANY JURISDICTION IN WHICH THE OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING THE OFFER OR TO DO SO, OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL CREATE ANY IMPLICATION THAT INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THIS DATE HEREOF. ------------------------ TABLE OF CONTENTS
PAGE --------- Available Information........................... 2 Incorporation of Certain Information by Reference..................................... 2 Risk Factors.................................... 3 The Company..................................... 8 Use of Proceeds................................. 9 Selling Stockholder............................. 10 Plan of Distribution............................ 11 Legal Matters................................... 11 Experts......................................... 11
- -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 5,202,004 SHARES IGEN INTERNATIONAL, INC. COMMON STOCK --------------------- PROSPECTUS --------------------- [INSERT DATE] PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION Estimated expenses (other than underwriting discounts and commissions, fees and expenses of counsel to each Selling Securityholder) payable in connection with the resale of the Common Stock offered hereby are as follows: SEC Registration.................................................................... $25,321 Nasdaq Listing Fee.................................................................. $17,500 Legal Fees and Expenses............................................................. $[insert] Accounting Fees and Expenses........................................................ $[insert] Printing Fees and Expenses.......................................................... $[insert] Miscellaneous....................................................................... $[insert] Total........................................................................... $[insert]
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS The Company's Bylaws provide that the Company shall indemnify its directors and officers to the fullest extent not prohibited by the General Corporation Law of the State of Delaware; provided, however, that the Company may modify the extent of such indemnification by individual contracts with its directors and officers; and, provided, further, that the Company shall not be required to indemnify and director or officer in connection with any proceeding (or part thereof) initiated by such person unless (i) such indemnification is expressly required to be made by law, (ii) the proceeding was authorized by the Board of Directors of the Company, (iii) such indemnification is provided by the Company, in its sole discretion, pursuant to the powers vested in the Company by the General Corporation Law of the State of Delaware, or (iv) such indemnification is otherwise required by law, by agreement, or by vote of the stockholders or disinterested directors. Section 145 of the General Corporation Law of the State of Delaware permits a corporation, under specified circumstances, to indemnify its directors, officers, employees or agents against expenses (including attorney's fees), judgments, fines and amounts paid in settlements actually and reasonably incurred by them in connection with any action, suit or proceeding brought by third parties by reason of the fact that they were or are directors, officers, employees or agents of the corporation, if such directors, officers, employees or agents acted in good faith and in a manner they 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 reason to believe their conduct was unlawful. In a derivative action, i.e., one by or in the right of the corporation, indemnification may be made only for expenses actually and reasonably incurred by directors, officers, employees or agents in connection with the defense or settlement of an action or suit, and only with respect to a matter as to which they shall have acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification shall be made if such person shall have been adjudged liable to the corporation, unless and only to the extent that the court in which the action or suit was brought shall determine upon application that the defendant directors, officers, employees or agents are fairly and reasonably entitled to indemnity for such expenses despite such adjudication of liability. Article VI of the Company's Certificate of Incorporation states that directors of the Company will not be personally liable to the Company or its stockholders for monetary damages for any breach of fiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to the Company or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the General Corporation Law of the state of Delaware, II-1 which makes directors liable for unlawful dividends or unlawful stock repurchases or redemptions or (iv) for any transaction from which the director derived an improper personal benefit. The Company's Certificate of Incorporation further provides that if the General Corporation Law of the State of Delaware is amended to authorize corporate action further eliminating or limiting the personal liability of directs, then the liability of the Company's directors shall be eliminated or limited to the fullest extent permitted by the General Corporation Law of the State of Delaware, as so amended. ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES 4.1 Certificate of Designation, Powers, Preferences and Rights of the Series B Convertible Preferred Stock of the Company dated December 18, 1997. 4.2 Purchase Agreement dated as of December 16, 1997 by and among the Company and the Selling Securityholders. 4.3 Registration Rights Agreement dated as of December 16, 1997 by and among the Company and the Selling Securityholders. 4.4 Bylaws of the Company, Article VII.(1) 5.1 Opinion of Wilmer, Cutler & Pickering as to the legality of the securities being registered. 23.1 Consent of Wilmer, Cutler & Pickering (included in Exhibit 5.1). 23.2 Consent of Deloitte & Touche, LLP, as independent public accountants for the Company.
- ------------------------ (1) Incorporated by reference to IGEN's Quarterly Report on Form 10-Q for the quarterly period ended December 31, 1996 filed with the Commission on February 13, 1997. ITEM 17. UNDERTAKINGS. 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 provisions described in Item 14, 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 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. The undersigned Registrant hereby undertakes: (1) To file, during any period in which any offers or sales are being made, a post-effective amendment to the registration statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high and of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate II-2 offering price set forth int the "Calculation of Registration Fee" table in the effective registration statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any other material change to such information in the registration statement. PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) do not apply, and the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement. (2) That for the purpose of determining any liability under the Act each such post-effective amendment may be deemed to be a new registration statement relating to the securities being offered therein and the offering of such securities at the time may be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities which are being registered which remain unsold at the termination of the offering. (4) 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 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. II-3 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe the it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Gaithersburg, Montgomery County, State of Maryland, on January 29, 1998. IGEN INTERNATIONAL, INC. By: /s/ SAMUEL J. WOHLSTADTER ----------------------------------------- Name: Samuel J. Wohlstadter Title: CHIEF EXECUTIVE OFFICER 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 CAPACITY DATE - ------------------------------ --------------------------- ------------------- Chief Executive Officer /s/ SAMUEL J. WOHLSTADTER (Principal Executive - ------------------------------ Officer); 01/29/98 Samuel J. Wohlstadter Director Vice President and Chief /s/ GEORGE V. MIGAUSKY Financial - ------------------------------ Officer (Principal 01/29/98 George V. Migausky Financial and Accounting Officer /s/ RICHARD J. MASSEY President (Chief Operating - ------------------------------ Officer); Director 01/29/98 Richard J. Massey /s/ EDWARD LURIER Director - ------------------------------ 01/29/98 Edward Lurier II-4 EX-4.1 2 EXHIBIT 4.1 Exhibit 4.1 SERIES B CONVERTIBLE PREFERRED STOCK The designation, powers, preferences and rights of the Series B Convertible Preferred Stock of IGEN International, Inc. (the "Company") are as follows: I. DESIGNATION AND AMOUNT. The designation of this series, which consists of twenty-five thousand (25,000) shares of preferred stock, par value $.001 (the "Preferred Shares"), is the Series B Convertible Preferred Stock (the "Series B Preferred Stock") and the face amount shall be One Thousand Dollars ($1,000) per share (the "Stated Value"). II. CONVERSION. A. Right to Convert. Subject to the limitations contained in paragraph G below, a holder of Preferred Shares (a "Holder") shall have the right to convert such Preferred Shares at any time and from time to time on or after the Initial Conversion Date (as defined below) into fully paid and non-assessable shares (the "Conversion Shares") of the Company's Common Stock, $.001 par value (the "Common Stock"), in accordance with the terms hereof (a "Conversion"). As used herein, "Initial Conversion Date" means the ninetieth (90th) day following the Issue Date and "Issue Date" means the date on which the Preferred Shares are issued pursuant to the Purchase Agreement by and among the Company and the purchasers (the "Purchasers") named therein (the "Purchase Agreement"). B. Conversion Notice. In order to convert Preferred Shares, the Holder thereof shall send by facsimile transmission, at any time prior to 11:59 p.m., eastern time, on the date on which the Holder wishes to effect such Conversion (the "Conversion Date"), to the Company and to its designated transfer agent for the Common Stock (the "Transfer Agent") (i) a notice of conversion stating the number of Preferred Shares to be converted (a "Conversion Notice") and (ii) a copy of the certificate or certificates representing the Preferred Shares being converted. The Holder shall thereafter send the original of the Conversion Notice and of such certificate or certificates to the Company. The Company shall issue a new certificate for Preferred Shares in the event that less than all of the Preferred Shares represented by a certificate delivered to the Company in connection with a Conversion are converted. Upon receipt of a Conversion Notice, the Company shall calculate the amount of dividends which have accrued on such Preferred Shares as provided herein up to and including the Conversion Date, the applicable Conversion Price and a calculation of the number of shares of Common Stock issuable upon such Conversion, and shall promptly submit such information to the Transfer Agent. In the case of a dispute as to the calculation of the Conversion Price or the number of Conversion Shares issuable upon a Conversion, the Company shall promptly issue to the Holder the number of Conversion Shares that are not disputed and shall submit the disputed calculations to its independent accountants within two (2) business days of receipt of such Holder's Conversion Notice. The Company shall cause such accountant to calculate the Conversion Price as provided herein and to notify the Company and the Holder of the results in writing no later than two (2) business days following the day on which it received the disputed calculations. Such accountant's calculation shall be deemed conclusive absent manifest error. The fees of any such accountant shall be borne by the party whose calculations are most at variance with those of such accountant. C. Number of Conversion Shares; Conversion Price. The number of Conversion Shares to be delivered by the Company pursuant to a Conversion shall be equal to (A) the aggregate Stated Value of the Preferred Shares being converted divided by (B) the Conversion Price. Subject to adjustment as provided in Section III below, the "Conversion Price" shall be equal to $13.96. D. Delivery of Common Stock Upon Conversion. Upon receipt of a Conversion Notice pursuant to paragraph B above, the Company shall, no later than the close of business on the third (3rd) business day following the Conversion Date set forth in such Conversion Notice (the "Delivery Date"), issue and deliver or cause to be delivered to the Holder certificates representing the number of Conversion Shares as shall be determined as provided in paragraph C above. If any Conversion would create a fractional Conversion Share, such fractional Conversion Share shall be disregarded and the number of Conversion Shares issuable upon such Conversion, in the aggregate, shall be rounded up or down to the nearest whole number of Conversion Shares. Conversion Shares delivered to the Holder shall not contain any restrictive legend as long as the sale of such Conversion Shares by the Holder is covered by a registration statement which has been filed and declared effective pursuant to the terms of the Registration Rights Agreement by and among the Company and the Purchasers (the "Registration Rights Agreement") or may be made pursuant to Rule 144(k) under the Securities Act or any successor rule or provision. E. Failure to Deliver Conversion Shares. In the event that the Company fails for any reason to deliver to a Holder the number of Conversion Shares issuable upon conversion of the Preferred Shares specified in the applicable Conversion Notice on or before the Delivery Date therefor (a "Conversion Default"), and such Conversion Default continues for longer than five (5) business days, the Company shall pay to the Holder cash payments ("Conversion Default Payments") in the amount of (i) (N/365) multiplied by (ii) the Stated Value of the Preferred Shares represented by the Conversion Shares which remain the subject of such Conversion Default multiplied by (iii) the lower of twenty-four percent (24%) and the maximum rate permitted by applicable law, where "N" equals the number of days elapsed between the original Delivery Date of such Conversion Shares and the earlier to occur of (A) the date on which all of such Conversion Shares are issued and delivered to such Holder and (B) the date on which such Preferred Shares are redeemed pursuant to the terms hereof. Cash amounts payable hereunder shall be paid on or before the fifth (5th) business day of the calendar month following the calendar month in which such amount has accrued. Nothing herein shall limit a Holder's right to pursue actual damages for the Company's failure to issue and deliver Conversion Shares on the applicable Delivery Date (including, without limitation, damages relating to any purchase of shares of Common Stock by such Holder to make delivery on a sale effected in anticipation of receiving Conversion Shares upon Conversion), and such Holder shall have the right to pursue all remedies available to it at law or in equity (including, without limitation, a decree of specific performance and/or injunctive relief). F. Mandatory Conversion. On the date which is five (5) years following the Issue Date (the "Maturity Date"), so long as the Common Stock shall be designated for quotation on the Nasdaq -2- National Market system or listed on the New York Stock Exchange or American Stock Exchange, and actively traded thereon, all Preferred Shares then outstanding shall be automatically converted into the number of shares of Common Stock equal to the Stated Value of such shares divided by the Conversion Price then in effect (a "Mandatory Conversion"), and the Maturity Date shall be deemed the Conversion Date with respect to such Mandatory Conversion. If a Mandatory Conversion occurs, the Company and the Holder shall follow the procedures for Conversion set forth in this Section II; provided, however, that the Holder shall not be required to send the Conversion Notice contemplated by paragraph B above. G. Limitations on Right to Convert. 1. In no event shall a Holder be permitted to convert any Preferred Shares in excess of that number of such shares upon the Conversion of which the number of Conversion Shares to be issued pursuant to such Conversion, when added to the number of shares of Common Stock issued pursuant to all prior Conversions of Preferred Shares and issuances of Dividend Payment Shares, would exceed 19.99% of the number of outstanding shares of Common Stock on the Issue Date (subject to equitable adjustments from time to time for the events described in Section III below) (the "Cap Amount"), except that such limitation shall not apply in the event that the Company obtains the approval of its stockholders as required by NASD Rule 4460 (or any other similar rule or regulation) for issuances of Common Stock in excess of such amount; provided, however that it is understood and agreed that any Holder which has converted Preferred Shares into a number of Conversion Shares that equals or exceeds such Holder's Allocation Amount (as defined below) shall have the right to require the Company, upon written notice to such effect, to seek such stockholder approval as soon as practicable (but in no event later than forty-five (45) days) following the Company's receipt of such notice. Until such approval is obtained, no Purchaser (as defined in the Purchase Agreement) shall be issued, upon Conversion of Preferred Shares, Conversion Shares in an amount greater than the product of (A) the Cap Amount times (B) a fraction, the numerator of which is the number of Preferred Shares purchased by such Purchaser pursuant to the Purchase Agreement and the denominator of which is the aggregate number of Preferred Shares purchased by all of the Purchasers pursuant to the Purchase Agreement (the "Allocation Amount"). In the event that any Purchaser shall sell or otherwise transfer all or any of its Preferred Shares, the transferee shall be allocated a pro rata portion of such Purchaser's Allocation Amount and shall be similarly bound. In the event that any Holder shall convert all of the Preferred Shares held by it into a number of Conversion Shares which, in the aggregate, is less than such Holder's Allocation Amount, then the difference between such Holder's Allocation Amount and the number of Conversion Shares actually issued to such Holder shall be allocated to the respective Allocation Amounts of the remaining Holders of Preferred Shares on a pro rata basis in proportion to the number of Preferred Shares then held by each such Holder relative to the aggregate number of Preferred Shares then outstanding. 2. Except with respect to a Holder which indicates that it elects not to be bound by the provisions of this subparagraph 2 on the signature page of the Purchase Agreement executed by such Holder, in no event shall any Holder be permitted to convert Preferred Shares in excess of that number of such shares upon the Conversion of which (x) the number of shares of Common Stock -3- beneficially owned by such Holder (other than shares of Common Stock which may be deemed beneficially owned except for being subject to a limitation on conversion or exercise analogous to the limitation contained in this subparagraph 2) plus (y) the number of shares of Common Stock issuable upon the Conversion of such Preferred Shares is equal to or exceeds (z) 4.99% of the number of shares of Common Stock then issued and outstanding. Nothing contained herein shall be deemed to restrict the right of a Holder to convert such excess number of Preferred Shares at such time as such Conversion will not violate the provisions of this subparagraph (2). To the extent that the limitation contained in this subparagraph 2 applies, the determination of whether Preferred Shares are convertible shall be in the sole discretion of the Holder, and the submission of a Conversion Notice shall be deemed to be such Holder's determination that the Preferred Shares described therein are convertible hereunder. H. "Trading Day" shall mean any day on which the Common Stock is traded for any period on the Nasdaq National Market or on the principal securities exchange or market on which the Common Stock is then traded. III. ADJUSTMENTS TO CONVERSION PRICE. A. Adjustment to Conversion Price Due to Stock Split, Stock Dividend, Etc. If prior to the Conversion of all of the Preferred Shares, (i) the number of outstanding shares of Common Stock is increased by a stock split, stock dividend, reclassification, the distribution to holders of Common Stock of rights or warrants entitling them to subscribe for or purchase Common Stock at less than the then Current Market Price (as defined below) thereof or other similar event, the Conversion Price shall be proportionately reduced, or (ii) the number of outstanding shares of Common Stock is decreased by a reverse stock split, combination or reclassification of shares or other similar event, the Conversion Price shall be proportionately increased. In such event, the Company shall notify the Transfer Agent of such change on or before the effective date thereof. The "Current Market Price" per share of Common Stock on any date shall be the average of the closing sale prices for the Common Stock as reported by Nasdaq, or by the principal securities market on which the Common Stock is then traded, on the five (5) consecutive Trading Days selected by the Company not later than the earlier of the date in question and the Trading Day immediately prior to the "ex" date, if any, with respect to the issuance or distribution requiring such computation. The term "'ex' date", when used with respect to any issuance or distribution, means the first Trading Day on which the Common Stock trades regular way in the market from which such average closing price is then to be determined without the right to receive such issuance or distribution. In the absence of one or more such quotations, the Company shall determine the current market price on the basis of such quotations as it considers appropriate. B. Adjustment Due to Merger, Consolidation, Etc. If, prior to the Conversion of all of the Preferred Shares, there shall be any merger, consolidation, exchange of shares, recapitalization, reorganization, redemption or other similar event, as a result of which shares of Common Stock shall be changed into the same or a different number of shares of the same or another class or classes of stock or securities of the Company or another entity or there is a sale of all or substantially all the Company's assets, then each such Holder shall thereafter have the right to receive upon Conversion -4- of the Preferred Shares held by it and in lieu of the shares of Common Stock immediately theretofore issuable upon conversion, such stock, securities and/or other assets (the "Change of Control Consideration"), if any, which such Holder would have been entitled to receive in such transaction had such Preferred Shares been converted immediately prior to such transaction, and in any such case appropriate provisions shall be made with respect to the rights and interests of such Holder to the end that the provisions hereof (including, without limitation, provisions for the adjustment of the Conversion Price and of the number of shares issuable upon a Conversion) shall thereafter be applicable as nearly as may be practicable in relation to any securities thereafter deliverable upon the exercise hereof. The Company shall not effect any transaction described in this paragraph B unless (i) it first gives to the Holder no less than twenty (20) days' prior written notice of such merger, consolidation, exchange of shares, recapitalization, reorganization, redemption or other similar event, and makes a public announcement of such event at the same time that it gives such notice and (ii) the resulting successor or acquiring entity (if not the Company) assumes by written instrument the obligations of the Company under this Certificate, including the terms of this paragraph B. Notwithstanding the provisions of paragraph II.A. above, in the event that the Company delivers a notice of a merger, consolidation, exchange of shares, recapitalization, reorganization, redemption or other similar event to each Holder which specifies an effective date therefor which is prior to the Initial Conversion Date, each Holder shall have the right to convert, from time to time following the delivery of such notice to such Holder, any or all of the Preferred Shares held by it, so that such Holder shall be entitled to receive the Change of Control Consideration with respect to any Conversion Shares which it received pursuant to a Conversion occurring prior to such effective date. C. Distribution of Assets. If, prior to the Conversion of all of the Preferred Shares, the Company shall declare or pay any dividends to holders of Common Stock, or declare or make any distribution of its assets (or rights to acquire its assets) to holders of Common Stock as a partial liquidating dividend, by way of return of capital or otherwise, including any dividend or distribution in cash or shares of capital stock of a subsidiary of the Company (collectively, a "Distribution"), then, upon a Conversion by the Holder occurring after the record date for determining shareholders entitled to such Distribution but prior to the effective date of such Distribution, each Holder shall be entitled to receive the amount of such assets which would have been payable to such Holder had such Holder been the holder of such shares of Common Stock on the record date for the determination of shareholders entitled to such Distribution. The Company shall deliver written notice of any Distribution to each Holder no less than twenty (20) business days prior to the effective date thereof. Notwithstanding the provisions of paragraph II.A. above, in the event that the Company delivers a notice of a Distribution to the Holders which specifies an effective date therefor which is prior to the Initial Conversion Date, each Holder shall have the right to convert, from time to time following the delivery of such notice to such Holder, any or all of the Preferred Shares held by it, so that such Holder shall be entitled to receive such Distribution with respect to any Conversion Shares which it received pursuant to a Conversion occurring prior to such effective date. D. No Fractional Shares. If any adjustment under this Section III would create a fractional share of Common Stock or a right to acquire a fractional share of Common Stock, such fractional share shall be disregarded and the number of shares of Common Stock issuable upon Conversion shall be rounded up or down to the nearest whole number of shares. -5- IV. DIVIDENDS. A. Dividends; Stock Payment Option. Each Holder of Preferred Shares shall be entitled to receive, to the extent permitted by applicable law, subject to the prior, full payment of any accumulated and unpaid dividends on any class or series of Senior Securities (as defined below) and in preference to the payment of any dividend on any class or series of Junior Securities (as defined below), cumulative dividends ("Dividends") on each Preferred Share in an amount equal to, on an annualized basis, the Stated Value of such Preferred Share times 7.75%, compounded annually. Dividends shall accrue and be payable, whether or not earned or declared, on each Preferred Share from the Issue Date through the earlier to occur of (A) the Maturity Date (as defined below) and (B) the redemption or conversion thereof in accordance with the terms hereof. Accrued Dividends on a Preferred Share shall be payable on each Conversion Date (as defined below), on the Maturity Date (as defined below) and on any Mandatory Redemption Date or Optional Redemption Date (as defined below) (each, a "Dividend Payment Date"). If, on any date, Dividends on any outstanding Preferred Shares have not been paid with respect to all Dividend Payment Dates preceding such date, the aggregate amount of such Dividends shall be fully paid before any distribution, whether by way of dividend or otherwise, shall be declared, paid or set apart with respect to any Junior Securities on or after such date. Dividends shall be paid either in cash or, at the option of the Company (the "Stock Payment Option"), and subject to the satisfaction of the conditions set forth in paragraph B below (the "Stock Payment Conditions"), in shares (the "Dividend Payment Shares") of the Common Stock. Cash Dividends shall be paid to each Holder within five (5) Business Days following the applicable Dividend Payment Date by delivering immediately available funds to such Holder in accordance with such Holder's wiring instructions. Any amount of Dividends payable in cash which is not paid within five (5) Business Days of the applicable Dividend Payment Date shall bear interest at an annual rate equal to the lower of (x) the "prime" rate (as published in the Wall Street Journal) on such fifth Business Day plus three percent (3%) and (y) the highest rate permitted by applicable law, for the number of days elapsed from such Dividend Payment Date until such amount is paid in full (the "Default Interest Rate"). B. Conditions to Stock Payment Option. If the Company wishes to exercise the Stock Payment Option, it may do so only if each of the following conditions has been satisfied as of the relevant Conversion Date: 1. the number of shares of Common Stock authorized, unissued and unreserved for all other purposes, or held in the Company's treasury, is sufficient to pay 125% of the aggregate number of (x) Conversion Shares issuable upon the conversion in full of the Preferred Shares and (y) the number of Dividend Payment Shares issuable pursuant to such option; 2. the Dividend Payment Shares are authorized for quotation on the Nasdaq National Market or for listing or quotation on any other national securities exchange or market on which the Common Stock may be listed; -6- 3. the Registration Statement (as defined in the Registration Rights Agreement) is effective and available for the sale of the Dividend Payment Shares by the Holder or such shares may be sold to the public pursuant to Rule 144(k); 4. a Mandatory Redemption Event (as defined herein) has not occurred or be continuing; and 5. the Company has delivered to each Holder a certificate, signed by an executive officer of the Company, setting forth: - the amount of the Dividend to which such Holder is entitled and, if not the same, the amount of such payment to be made in Dividend Payment Shares; - the number of Dividend Payment Shares to be delivered in payment of such Dividends, and the calculation therefor; and - a statement to the effect that all of the conditions set forth in sub-paragraphs 1-4 above have been satisfied. C. Delivery of Dividend Payment Shares. Upon exercise of the Stock Payment Option, the Company shall deliver to each Holder, on or before the third (3rd) Business Day following the applicable Dividend Payment Date (the "Dividend Payment Share Delivery Date"), the aggregate number of whole Dividend Payment Shares that is determined by dividing (x) the amount of the Dividend to which such Holder is entitled as of such Dividend Payment Date with respect to all of such Holder's Preferred Shares by (y) the applicable Conversion Price on such Dividend Payment Date. No fractional Dividend Payment Shares shall be issued; the Company shall, in lieu thereof, either issue a number of Dividend Payment Shares which reflects a rounding up to the next whole number of shares or pay such amount in cash. Dividend Payment Shares shall be fully paid and non-assessable, free and clear of any liens, claims, preemptive rights or encumbrances imposed by or through the Company. D. Failure to Deliver Dividend Payment Shares. In the event that the Company fails for any reason to deliver to a Holder the appropriate number of Dividend Payment Shares on or before the third (3rd) Business Day following the applicable Dividend Payment Share Delivery Date, the Company shall, upon written notice by such Holder, immediately pay the amount of the Dividend in cash, together with interest at an annual rate equal to the Default Interest Rate on such unpaid amount accruing daily from the applicable Dividend Payment Date until the date on which such amount is paid. Each Holder shall have the right to pursue actual damages for the Company's failure to issue and deliver Dividend Payment Shares on the Dividend Payment Share Delivery Date for a Dividend, including, without limitation, damages relating to any purchase of shares of Common Stock by such Holder to make delivery on a sale effected in anticipation of receiving Dividend Payment Shares, such damages to be in an amount equal to (A) the aggregate amount paid by such Holder for the shares of Common Stock so purchased minus (B) (i) the aggregate amount of net -7- proceeds, if any, received by such Holder from the sale of the Dividend Payment Shares issued by the Company with respect to such Dividend and (ii) the amount of any cash received in lieu of such Dividend Payment Shares pursuant to the immediately preceding sentence (excluding any interest accrued thereon), and such Holder shall have the right to pursue all remedies available to it at law or in equity (including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company's failure to deliver Dividend Payment Shares). E. Exercise of Stock Payment Option. In order for the Company to exercise the Stock Payment Option, it must deliver written notice thereof (a "Stock Payment Exercise Notice") to each Holder on or before the tenth (10th) Business Day prior to the Initial Conversion Date (as defined below) and prior to the first day of each calendar quarter thereafter specifying whether the Company intends to pay Dividends during such calendar quarter (or shorter period in the case of the notice delivered prior to the Initial Conversion Date) in Dividend Payment Shares or cash. Upon delivering a Stock Payment Exercise Notice to a Holder, the Company thereafter shall be irrevocably bound by its election made therein to deliver Dividend Payment Shares or cash, as the case may be, during the period to which such notice relates. V. PAYMENT UPON DISSOLUTION. (a) Upon the occurrence of (x) any insolvency or bankruptcy proceedings, or any receivership, liquidation, reorganization or other similar proceedings in connection therewith, commenced by the Company or by its creditors, as such, or relating to its assets or (y) the dissolution or other winding up of the Company whether total or partial, whether voluntary or involuntary and whether or not involving insolvency or bankruptcy proceedings, or (z) any assignment for the benefit of creditors or any marshaling of the material assets or material liabilities of the Company (each, a "Liquidation Event"), no distribution shall be made to the holders of any shares of Junior Securities (as defined below) unless, following the payment of preferential amounts on all Senior Securities (as defined below), each Holder shall have received the Liquidation Preference (as defined below) with respect to each Preferred Share then held by such Holder. In the event that upon the occurrence of a Liquidation Event, and following the payment of preferential amounts on all Senior Securities (as defined below), the assets available for distribution to the Holders and the holders of Pari Passu Securities (as defined below) are insufficient to pay the Liquidation Preference with respect to all of the outstanding Preferred Shares and the preferential amounts payable to such holders, the entire assets of the Company shall be distributed ratably among the Preferred Shares and the shares of Pari Passu Securities in proportion to the ratio that the preferential amount payable on each such share (which shall be the Liquidation Preference in the case of a Preferred Share) bears to the aggregate preferential amount payable on all such shares. If, after the payment of all preferential amounts to the holders of Senior Securities, the Holders and the holders of Pari Passu Securities, there are assets of the Company remaining, the holders of Junior Securities shall share in such assets ratably in accordance with the respective terms of such Junior Securities. (b) The "Liquidation Preference" with respect to a Preferred Share shall mean an amount equal to the Stated Value of such Preferred Share plus any accrued and unpaid Dividends thereon. "Junior Securities" shall mean the Common Stock and all other capital stock of the -8- Company that are not Pari Passu Securities or do not have a preference over the Preferred Stock in respect of dividends, redemption or distribution upon liquidation. "Senior Securities" shall mean any securities of the Company which by their terms have a preference over the Preferred Stock in respect of dividends, redemption or distribution upon liquidation. "Pari Passu Securities" shall mean any securities ranking pari passu with the Preferred Stock in respect of dividends, redemption and distribution upon liquidation. VI. OPTIONAL REDEMPTION BY THE COMPANY. A. Optional Redemption. The Company shall have the right, at any time commencing on the date which is thirty-six (36) months after the Issue Date (the "Initial Optional Redemption Date"), to redeem (an "Optional Redemption") all of the Preferred Shares then outstanding at the Optional Redemption Price (as defined herein); provided, however, that in order to effect an Optional Redemption, the Company shall have provided to each Holder thirty (30) Trading Days' prior written notice of the effective date of the Optional Redemption (the "Optional Redemption Date"). Nothing contained herein shall prevent a Holder from converting any or all of its Preferred Shares at any time or from time to time prior to the Optional Redemption Date. B. Optional Redemption Price. The "Optional Redemption Price" shall mean the Stated Value of the Preferred Shares being redeemed multiplied by (A) 103% if the Optional Redemption Date occurs during the twelve (12) month period beginning on the Initial Optional Redemption Date and (B) 100% if the Optional Redemption Date occurs after the last day of such twelve (12) month period. C. Payment of Optional Redemption Price. The Company shall pay the Optional Redemption Price to each Holder within five (5) business days of the Optional Redemption Date. If the Company fails to pay the Optional Redemption Price on or before such fifth business day, interest at an annual rate equal to the Default Interest Rate (calculated as of such fifth business day) shall accrue on such unpaid amount on a daily basis calculated from the Optional Redemption Date until the date on which such amount is paid in full. VII. MANDATORY REDEMPTION BY THE HOLDER. A. Mandatory Redemption. Subject to the provisions of paragraph F below, in the event that a Mandatory Redemption Event (as defined herein) occurs, each Holder shall have the right, upon written notice to the Company, to have all or any portion of the Preferred Shares then held by such Holder redeemed by the Company (a "Mandatory Redemption") at the Mandatory Redemption Price (as defined herein) in same day funds. Such notice shall specify the effective date of such Mandatory Redemption (the "Mandatory Redemption Date") and the number of Preferred Shares to be redeemed. The Optional Redemption Date and the Mandatory Redemption Date are sometimes each referred to herein as a "Redemption Date". B. Mandatory Redemption Price. The "Mandatory Redemption Price" shall be equal to the Stated Value of the Preferred Shares being redeemed multiplied by (i) during the twelve-month -9- period following the Issue Date (the "Initial Redemption Period"), one hundred and nine percent (109%), (ii) during the twelve-month period following the end of the Initial Redemption Period, one hundred and six percent (106%), and (iii) thereafter, one hundred and three percent (103%). C. Payment of Mandatory Redemption Price. The Company shall pay the Mandatory Redemption Price to each Holder who has requested a Mandatory Redemption within five (5) business days of the Mandatory Redemption Date. If the Company fails to pay the Mandatory Redemption Price to a Holder within five (5) business days of the Mandatory Redemption Date, such Holder shall be entitled to interest at an annual rate equal to the Default Interest Rate (calculated as of such 5th business day) from the Mandatory Redemption Date until the Mandatory Redemption Price has been paid in full. D. Mandatory Redemption Event. Each of the following events shall be deemed a "Mandatory Redemption Event": 1. the Company fails for any reason (including without limitation (x) as a result of not having a sufficient number of shares of Common Stock authorized and reserved for issuance, or (y) due to the listing requirements of any quotation system or exchange on which the Common Stock is quoted or listed with which the Company is unable to comply as a result of voluntary action undertaken by the Company or a failure by the Company to take action) to issue shares of Common Stock to a Holder and deliver certificates representing such shares to such Holder as and when required by the provisions hereof upon Conversion of any Preferred Shares, and such failure continues for twenty (20) Business Days; 2. any material representation or warranty made by the Company in the Purchase Agreement, the Registration Rights Agreement, or any other agreement, document, certificate or other instrument delivered in connection with the transactions contemplated hereby or thereby is inaccurate or misleading in any material respect as of the date such representation or warranty was made; 3. if following the declaration of effectiveness of the Registration Statement (as defined in the Registration Rights Agreement) and while the effectiveness of the Registration Statement is required to be maintained pursuant to the terms of the Registration Rights Agreement, the effectiveness of the Registration Statement lapses for any reason (including without limitation, the issuance of a stop order) or is unavailable to the Holder for the sale of Conversion Shares in accordance with the terms of the Registration Rights Agreement, and such lapse or unavailability continues for a period of ten (10) Business Days, provided that the cause of such lapse or unavailability results from voluntary action undertaken by the Company or its failure to take action; and 4. the Common Stock is not quoted on the Nasdaq National Market or listed on the New York Stock Exchange or American Stock Exchange due to any voluntary action or the failure to take action on the part of the Company. -10- Notwithstanding the foregoing, to the extent that the Company uses its best efforts to take action to avoid a Mandatory Redemption Event and such action is unsuccessful, such failed attempt, in and of itself, will not be deemed to trigger a Mandatory Redemption Event. E. Failure to Pay Redemption Amounts. If the Company fails to pay the Mandatory Redemption Price within ten (10) business days of the payable date therefor, and has not exercised the Penalty Option (as defined below) in accordance with paragraph F below, then the Holder shall have the right at any time, so long as the Company remains in default, to require the Company, upon written notice, to immediately issue, in lieu of the Mandatory Redemption Price, the number of shares of Common Stock of the Company equal to the Mandatory Redemption Price divided by the Conversion Price in effect on such Conversion Date as is specified by the Holder in writing to the Company. F. Penalty Option. In the event that a Mandatory Redemption Event described in paragraph D.3 or D.4 above occurs and is continuing, the Company may, in lieu of redeeming Preferred Shares as provided herein, elect (i) to increase the rate at which Dividends will accrue on the Preferred Shares and be payable hereunder to fourteen percent (14)%, such increase to be effective as of the related Mandatory Redemption Date and (ii) to pay such Dividends in cash within five business days of the end of each calendar month in which such increased Dividends have accrued (the "Penalty Option"). Upon the termination of the applicable Mandatory Redemption Event, such increased Dividend rate and payment frequency will revert back to the Dividend rate and payment frequency otherwise provided in this Certificate. The Company shall give written notice to each Holder of its intention to exercise the Penalty Option within five (5) business days of receiving notice of a Mandatory Redemption from a Holder. VIII. MISCELLANEOUS. A. Notices. Except as otherwise provided herein, any notice, demand or request required or permitted to be given by the Company or a Holder pursuant to the terms of this Certificate shall be in writing and shall be deemed given (i) when delivered personally or by verifiable facsimile transmission (with a hard copy to follow), (ii) on the next business day after timely delivery to an overnight courier and (iii) on the third business day after deposit in the U.S. mail (certified or registered mail, return receipt requested, postage prepaid), addressed as follows: If to the Company: IGEN International, Inc. 16020 Industrial Drive Gaithersburg, MD 20817 Attn: Messrs. Samuel J. Wohlstadter George V. Migausky Dr. Richard J. Massey Fax: -11- with a copy to: Wilmer, Cutler & Pickering 2445 M Street, N.W. Washington, DC 20037 Attn: Stephen P. Doyle, Esq. Fax: 202-663-6363 and if to a Holder, at such address as such Holder shall have furnished the Company in writing. B. Transfer of Preferred Shares. A Holder may sell or transfer all or any portion of the Preferred Shares to any person or entity as long as such sale or transfer is the subject of an effective registration statement under the Securities Act or is exempt from registration thereunder and otherwise is made in accordance with the terms of the Purchase Agreement. From and after the date of such sale or transfer, the transferee hereof shall be deemed to be a Holder. Upon any such sale or transfer, the Company shall, promptly following the return of the certificate or certificates representing the Preferred Shares that are the subject of such sale or transfer, issue and deliver to such transferee a new certificate in the name of such transferee. C. Lost or Stolen Certificate. Upon receipt by the Company of evidence of the loss, theft, destruction or mutilation of a certificate representing Preferred Shares, and (in the case of loss, theft or destruction) of indemnity or security reasonably satisfactory to the Company, and upon surrender and cancellation of such certificate if mutilated, the Company shall execute and deliver to the Holder a new certificate identical in all respects to the original certificate. D. No Voting Rights. Except as provided by applicable law and paragraph G below, the Holders of the Preferred Shares shall have no voting rights with respect to the business, management or affairs of the Company; provided that the Company shall provide each Holder with prior notification of each meeting of stockholders (and copies of proxy statements and other information sent to such stockholders). E. Remedies, Characterization, Other Obligations, Breaches and Injunctive Relief. The remedies provided to a Holder in this Certificate shall be cumulative and in addition to all other remedies available to such Holder under this Certificate, at law or in equity (including without limitation a decree of specific performance and/or other injunctive relief), no remedy contained herein shall be deemed a waiver of compliance with the provisions giving rise to such remedy and nothing contained herein shall limit such Holder's right to pursue actual damages for any failure by the Company to comply with the terms of this Certificate. The Company agrees with each Holder that there shall be no characterization concerning this instrument other than as specifically provided herein. Amounts set forth or provided for herein with respect to payments, conversion and the like (and the computation thereof) shall be the amounts to be received by the Holder hereof and shall not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance thereof). -12- F. Failure or Delay not Waiver. No failure or delay on the part of a Holder in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege. G. Protective Provisions. So long as Preferred Shares are outstanding, the Company shall not, without first obtaining the approval of the Holders of at least two-thirds (2/3) of the then outstanding Preferred Shares: 1. alter or change (x) the rights, preferences or privileges of the Series B Preferred Stock or (y) any other capital stock of the Company so as to affect adversely the Series B Preferred Stock; 2. create any new class or series of capital stock having a preference over or ranking pari passu with the Series B Preferred Stock as to redemption, the payment of dividends or distribution of assets upon a Liquidation Event or any other liquidation, dissolution or winding up of the Company; 3. increase the authorized number of shares of Series B Preferred Stock; or 4. re-issue any shares of Series B Preferred Stock which have been converted in accordance with the terms hereof. In the event that Holders of at least two-thirds (2/3) of the then outstanding shares of Series B Preferred Stock agree to allow the Company to alter or change the rights, preferences or privileges of the Series B Preferred Stock, pursuant to the terms hereof, then the Company will deliver notice of such approved change, no later than the twentieth (20th) day prior to the effective date of such approved change, to the holders of the Series B Preferred Stock that did not agree to such alteration or change (the "Dissenting Holders") and the Dissenting Holders shall have the right to convert their Preferred Shares at any time and from time to time following delivery of such notice. No such change shall be effective to the extent that, by its terms, it applies to less than all of the Holders of Preferred Shares then outstanding. -13- EX-4.2 3 EXHIBIT 4.2 Exhibit 4.2 PURCHASE AGREEMENT PURCHASE AGREEMENT (this "Agreement"), dated as of December 16, 1997, by and among IGEN International, Inc., a Delaware corporation (the "Company"), and the entities whose names appear on the signature pages hereof. Such entities are each referred to herein as a "Purchaser" and, collectively, as the "Purchasers". The Company wishes to sell and each Purchaser wishes to buy, subject to the terms and conditions set forth in this Agreement, shares (the "Preferred Shares") of the Company's Series B Convertible Preferred Stock (the "Preferred Stock"), in reliance on the exemption from securities registration afforded by the provisions of Regulation D under the Securities Act of 1933, as amended (the "Securities Act"). The Preferred Shares are convertible pursuant to the terms of a Certificate of Designation relating to the Preferred Stock, the form of which is attached hereto as Exhibit A (the "Certificate"), into shares of the Company's Common Stock, $.001 par value (the "Common Stock"). The term (i) "Conversion Shares" shall mean, at any time, the shares of Common Stock that are issued or issuable upon conversion of the Preferred Shares, (ii) "Dividend Payment Shares" shall mean the shares of Common Stock issued by the Company in payment of dividends on the Preferred Shares in accordance with the terms of the Certificate and (iii) "Securities" shall mean the Preferred Shares, the Conversion Shares and the Dividend Payment Shares. The parties hereto agree as follows: 1. PURCHASE AND SALE OF PREFERRED STOCK. 1.1 Agreement to Purchase and Sell. Upon the terms and subject to the conditions set forth herein, the Company agrees to sell at the Closing (as defined below), and each Purchaser agrees to purchase, the number of Preferred Shares set forth on the signature page hereof executed by such Purchaser, at a purchase price equal to one thousand dollars ($1,000) times the number of Preferred Shares purchased by such Purchaser (the "Purchase Price"). 1.2 Closing. Subject to the satisfaction of the conditions set forth herein, the closing of the purchase and sale of the Preferred Shares (the "Closing") will be deemed to occur when this Agreement, and the other Transaction Documents (as defined below), have been executed and delivered by the Company and each Purchaser, and full payment of the amount of the Purchase Price payable by each Purchaser has been made by such Purchaser by wire transfer of same day funds to an account designated by the Company against delivery by the Company of duly executed certificates representing the Preferred Shares purchased by such Purchaser hereunder. The date on which the Closing is deemed to occur is referred to herein as the "Closing Date". 1.3 Certain Definitions. When used herein, (A) "business day" shall mean any day on which the New York Stock Exchange and commercial banks in the city of New York are open for business and (B) an "affiliate" of a party shall mean any person or entity controlling, controlled by or under common control with that party. 2. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. Each Purchaser, solely with respect to it, hereby makes the following representations and warranties to the Company (which shall be true as of the date hereof and as of the Closing Date) and agrees with the Company that: 2.1 Authorization; Enforceability. Such Purchaser is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization with full power and authority to purchase the Preferred Shares and to execute and deliver this Agreement. Such Purchaser has taken all action necessary for the authorization, execution, delivery and performance of this Agreement and the other Transaction Documents to which it is a party, and its obligations hereunder and thereunder, and, upon execution and delivery thereof by the Company, this Agreement and the other Transaction Documents to which it is a party constitute such Purchaser's valid and legally binding obligations, enforceable in accordance with their respective terms, except as such enforcement may be limited by (i) applicable bankruptcy, insolvency, reorganization or other laws of general application relating to or affecting the enforcement of creditors' rights generally and (ii) general principles of equity. 2.2 Accredited Investor; Investment Intent. Such Purchaser is an accredited investor, as defined in Rule 501 of Regulation D under the Securities Act. Such Purchaser is acquiring the Preferred Shares solely for its own account for investment purposes as a principal and not with a view to the public resale or distribution of all or any part thereof; provided, however that in making such representation, such Purchaser does not agree to hold the Securities for any minimum or specific term and reserves the right to sell, transfer or otherwise dispose of the Securities at any time in accordance with the provisions of this Agreement and with Federal and state securities laws applicable to such sale, transfer or disposition. 2.3 Information. The Company has provided such Purchaser with certain written information regarding the Company and has granted to such Purchaser the opportunity to ask questions of and receive answers from representatives of the Company, its officers, directors, employees and agents concerning the terms and conditions of the purchase and sale of the Preferred Shares hereunder, and the Company and its business and prospects. 2.4 Limitations on Disposition. Such Purchaser acknowledges that the Preferred Shares are "restricted securities" under the Securities Act and that under the Securities Act and applicable rules and regulations neither the Preferred Shares nor any interest therein may be offered for sale or resold absent registration under the Securities Act or unless pursuant to an exemption therefrom. -2- 2.5 Legend. Such Purchaser understands that the Preferred Shares shall bear at issuance the following legend: "The security represented by this certificate has not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or the securities laws of any state, and may not be offered or sold unless a registration statement under the Securities Act and applicable state securities laws shall have become effective with regard thereto, or an exemption from registration under the Securities Act and applicable state securities laws is available in connection with such offer or sale. Such security is issued subject to the provisions of (i) a Purchase Agreement, dated December , 1997, by and among IGEN International, Inc. (the "Company") and the purchasers named therein, and (ii) a Registration Rights Agreement, dated December , 1997, by and among the Company and such purchasers." Notwithstanding the foregoing, it is agreed that, as long as (A) the resale or transfer (including without limitation a pledge) of any Security is registered pursuant to an effective registration statement, (B) the holder thereof provides the Company with an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable transactions (the cost of which shall be borne by such holder) to the effect that such Security can be sold publicly without registration under the Securities Act, (C) such Security can be sold pursuant to Rule 144 under the Securities Act ("Rule 144") and a registered broker dealer provides to the Company a customary broker's Rule 144 letter and such holder delivers to the Company a customary seller's representation letter, or (D) such Security is eligible for resale under Rule 144(k), such Security shall be issued without any legend or other restrictive language and, with respect to any Security upon which such legend is stamped, the Company shall issue new certificates without such legend to the holder thereof upon request. 2.6 Fees. Such Purchaser is not obligated to pay any compensation or other fee, cost or related expenditure to any underwriter, broker, agent or other representative in connection with the transactions contemplated hereby. 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company hereby makes the following representations and warranties to each Purchaser (which shall be true as of the date hereof and as of the Closing Date) and agrees with such Purchaser that: 3.1 Organization, Good Standing and Qualification. Each of the Company and its subsidiaries is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite corporate power and authority to carry on its business as now conducted. Each of the Company and its subsidiaries is duly qualified to transact business and is in good standing in each jurisdiction in which the failure so to qualify would have a material adverse effect on the consolidated business or financial condition of the -3- Company and its subsidiaries taken as a whole. The term "subsidiaries" means corporations in which the Company has an equity interest of greater than 50%. 3.2 Authorization; Consents. The Company has the requisite corporate power and authority to enter into and perform its obligations under (i) this Agreement, (ii) the Registration Rights Agreement and (iii) all other agreements, documents, certificates or other instruments delivered by the Company at the Closing (the instruments described in (i), (ii) and (iii) being collectively referred to herein as the "Transaction Documents"), to execute and perform its obligations under the Certificate, to issue and sell the Preferred Shares to such Purchaser in accordance with the terms of the Certificate, to issue the Conversion Shares upon conversion of the Preferred Shares in accordance with the terms thereof and to issue the Dividend Payment Shares in accordance with the terms of the Certificate. All corporate action on the part of the Company by its officers, directors and stockholders necessary for (A) the authorization, execution and delivery of, and the performance by the Company of its obligations under, the Transaction Documents and (B) the authorization, execution and filing of, and performance by the Company of its obligations under the Certificate has been taken, and no further consent or authorization of the Company, its Board of Directors, its stockholders, or any governmental agency or organization or any other person or entity is required (pursuant to any rule of the National Association of Securities Dealers, Inc. or otherwise). 3.3 Enforcement. The Transaction Documents and the Certificate constitute valid and legally binding obligations of the Company, enforceable in accordance with their respective terms, except as such enforcement may be limited by (i) applicable bankruptcy, insolvency, reorganization or other laws of general application relating to or affecting the enforcement of creditors' rights generally and (ii) general principles of equity. 3.4 Disclosure Documents; Material Agreements; Other Information. The Company has filed with the Commission: (i) the Company's Annual Report on Form 10-K for the year ended March 31, 1997, (ii) Quarterly Reports on Form 10-Q for the quarters ended June 30, 1997 and September 30, 1997, (iii) all Current Reports on Form 8-K required to be filed with the Commission since March 31, 1997 and (iv) the Company's definitive Proxy Statement for its 199[7] Annual Meeting of Stockholders (collectively, the "Disclosure Documents"). The Company is not aware of any event that would require the filing of, or with respect to which the Company intends to file, a Form 8-K after the Closing. Each Disclosure Document, as of the date of the filing thereof with the Commission, conformed in all material respects to the requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and regulations thereunder, and, as of the date of such filing, such Disclosure Document did not contain an untrue statement of material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. All material agreements required to be filed as exhibits to the Disclosure Documents have been filed as required. To the best of the Company's knowledge, neither the Company nor any of its subsidiaries is in breach of any agreement to which it is a party or by which it is bound where such breach is reasonably likely to have a material adverse effect on the consolidated -4- business or financial condition of the Company and its subsidiaries taken as a whole. To the best of the Company's knowledge, except as set forth in the Disclosure Documents or any schedule or exhibit attached hereto, the Company has no liabilities, contingent or otherwise, other than liabilities incurred in the ordinary course of business which, under generally accepted accounting principles, which are not required to be reflected in the Company's financial statements and which, individually or in the aggregate, are not material to the consolidated business or financial condition of the Company and its subsidiaries taken as a whole. The financial statements of the Company included in the Disclosure Documents, as of their respective dates (A) complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of the Commission with respect thereto and (B) have been prepared in accordance with generally accepted accounting principles consistently applied at the times and during the periods involved (except (i) as may be otherwise indicated in such financial statements or the notes thereto, or (ii) in the case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed or summary statements) and fairly present in all material respects the financial position of the Company as of the dates thereof and the results of its operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end adjustments). The written information provided to the Purchaser as described in paragraph 2.3 above does not contain an untrue statement of material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein,in light of the circumstances under which they were made, not misleading and does not include any material, non-public information. 3.5 Capitalization. The capitalization of the Company as of the date hereof, including its authorized capital stock, the number of shares issued and outstanding, the number of shares issuable and reserved for issuance pursuant to the Company's stock option plans, the number of shares issuable and reserved for issuance pursuant to securities (other than the Preferred Shares) exercisable for, or convertible into or exchangeable for any shares of Common Stock and the number of shares initially to be reserved for issuance upon conversion of the Preferred Shares is set forth on Schedule 3.5 hereto. All of such outstanding shares of capital stock have been, or upon issuance will be, validly issued, fully paid and non-assessable. No shares of the capital stock of the Company are subject to preemptive rights or any other similar rights of the stockholders of the Company or any liens or encumbrances created by or through the Company. Except as disclosed on Schedule 3.5, or as contemplated herein, as of the date of this Agreement and as of the Closing, there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into or exercisable or exchangeable for, any shares of capital stock of the Company or any of its subsidiaries, or arrangements by which the Company or any of its subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its subsidiaries. 3.6 Valid Issuance. The Preferred Shares are duly authorized and, when issued, sold and delivered in accordance with the terms hereof, (i) will be duly and validly issued, fully paid and nonassessable, free and clear of any taxes, liens, claims, preemptive or similar rights or encumbrances imposed by or through the Company, (ii) based in part upon the representations of -5- such Purchaser in this Agreement, will be issued, sold and delivered in compliance with all applicable Federal and state securities laws and (iii) will be entitled to all of the rights, preferences and privileges set forth in the Certificate. The Conversion Shares are duly authorized and reserved for issuance and, when issued upon conversion of the Preferred Shares in accordance with the terms thereof, will be duly and validly issued, fully paid and nonassessable, free and clear of any taxes, liens, claims, preemptive or similar rights or encumbrances imposed by or through the Company. The Dividend Payment Shares are duly authorized and, upon the issuance thereof in accordance with the terms of the Certificate, will be duly and validly issued, fully paid and nonassessable, free and clear of any taxes, liens, claims, preemptive or similar rights or encumbrances imposed by or through the Company. 3.7 No Conflict with Other Instruments. Except as set forth on Schedule 3.7, neither the Company nor any of its subsidiaries is in violation of any provisions of its Certificate of Incorporation, Bylaws or any other governing document as amended and in effect on and as of the date hereof or, to the best of the Company's knowledge, in default (and no event has occurred which, with notice or lapse of time or both, would constitute a default) under any provision of any instrument or contract to which it is a party or by which it is bound, or of any provision of any Federal or state judgment, writ, decree, order, statute, rule or governmental regulation applicable to the Company, which would have a material adverse effect on the consolidated business or financial condition of the Company and its subsidiaries taken as a whole. The execution, delivery and performance of the Transaction Documents, the execution and filing of the Certificate, and the consummation of the transactions contemplated hereby and thereby (including without limitation, the issuance of the Preferred Shares and the reservation for issuance and issuance of the Conversion Shares and the Dividend Payment Shares) will not result in any such violation or be in conflict with or constitute, with or without the passage of time and giving of notice, either a default under any such provision, instrument or contract or an event which results in the creation of any lien, charge or encumbrance upon any assets of the Company or of any of its subsidiaries or the triggering of any preemptive or anti-dilution rights or rights of first refusal or first offer on the part of holders of the Company's securities. 3.8 Financial Condition; Taxes; Litigation. 3.8.1 The Company's financial condition is, in all material respects, as described in the Disclosure Documents, except for changes in the ordinary course of business and normal year-end adjustments that are not, in the aggregate, materially adverse to consolidated business or financial condition of the Company or its subsidiaries taken as a whole. Except as otherwise described in the Disclosure Documents, there have been no material adverse changes to the Company's business, operations, properties, financial condition, prospects or results of operations since the date of the Company's most recent audited financial statements contained in the Disclosure Documents. 3.8.2 The Company has filed all tax returns required to be filed by it or obtained extensions of the due date for such returns and paid all taxes which are due, except for taxes -6- which it reasonably disputes or which could not reasonably be expected to have a material adverse effect on the consolidated business or financial condition of the Company and its subsidiaries taken as a whole. 3.8.3 Except as set forth in Schedule 3.8.3, each of the Company and its subsidiaries is not the subject of any pending or, to the Company's knowledge, threatened inquiry, investigation or administrative or legal proceeding by the Internal Revenue Service, the taxing authorities of any state or local jurisdiction, the Commission or any state securities commission or other governmental or regulatory entity which could reasonably be expected to have a material adverse effect on the consolidated business or financial condition of the Company and its subsidiaries taken as a whole. 3.8.4 Except as set forth in Schedule 3.8.4, there is no material claim, litigation or administrative proceeding or inquiry pending, or, to the best of the Company's knowledge, threatened, against the Company or any of its subsidiaries, or against any officer, director or employee of the Company or any such subsidiary in connection with such person's employment therewith. Neither the Company nor any of its subsidiaries is a party to or subject to the provisions of, any order, writ, injunction, judgment or decree of any court or government agency or instrumentality which could reasonably be expected to have a material adverse effect on the consolidated business or financial condition of the Company and its subsidiaries. 3.9 Reporting Company; Form S-3. The Company is subject to the reporting requirements of the Exchange Act, has a class of securities registered under Section 12 of the Exchange Act, and has filed all reports required thereby. The Company is eligible to register the Conversion Shares and the Dividend Payment Shares for resale on a registration statement on Form S-3 under the Securities Act. 3.10 Acknowledgement of Dilution. The Company acknowledges that the issuance of (i) the Conversion Shares upon conversion of the Preferred Shares in accordance with the terms of the Certificate and (ii) the Dividend Payment Shares in accordance with the terms of the Certificate may result in dilution of the outstanding shares of Common Stock, which dilution may be substantial under certain market conditions. The Company further acknowledges that its obligation (x) to issue Conversion Shares upon conversion of the Preferred Shares and (y) to issue Dividend Payment Shares in accordance with the terms of the Certificate is unconditional and absolute regardless of the effect of any such dilution. The Board of Directors of the Company has reviewed the Transaction Documents, and has determined that the transactions contemplated thereby are in the best interests of the Company and its stockholders. 3.11 Intellectual Property. The Company owns or possesses adequate rights to inventions, know-how, patents, copyrights, confidential information and other intellectual property rights necessary to conduct the business now operated by them, or presently employed by them, and have not received any notice of infringement of or conflict with asserted rights of others with respect to any such rights that, if determined adversely to the Company or any of its subsidiaries, -7- would individually or in the aggregate have a material adverse effect on the consolidated business or financial condition of the Company and its subsidiaries taken as a whole. 3.12 Registration Rights; Rights of Participation. Except as described on Schedule 3.12 hereto, (A) the Company has not granted or agreed to grant to any person or entity any rights (including "piggy-back" registration rights) to have any securities of the Company registered with the Commission or any other governmental authority and (B) no person or entity, including, but not limited to, current or former stockholders of the Company, underwriters, brokers, agents or other third parties, has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by the Certificate, this Agreement or any other Transaction Document which has not been waived. 3.13 Trading on Nasdaq. The Common Stock is authorized for quotation on the Nasdaq National Market system, and trading in the Common Stock on Nasdaq has not been suspended. The Company is (or will be at the Closing) in full compliance with the designation criteria of the Nasdaq National Market, and does not reasonably anticipate that the Common Stock will lose its designation as a Nasdaq National Market security, whether by reason of the transactions contemplated by this Agreement or the other Transaction Documents or otherwise. Stockholder approval for the issuance of the Preferred Shares is not required under NASD Rule 4460. 3.14 Solicitation. Neither the Company nor any of its subsidiaries or affiliates, nor any person acting on its or their behalf, (i) has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D under the Securities Act) in connection with the offer or sale of the Preferred Shares or (ii) has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under any circumstances that would require registration of the Preferred Shares under the Securities Act. 3.15 Fees. Except as described on Schedule 3.15 hereto, the Company is not obligated to pay any compensation or other fee, cost or related expenditure to any underwriter, broker, agent or other representative in connection with the transactions contemplated hereby. 3.16 Foreign Corrupt Practices. To the knowledge of the Company, neither the Company, nor any of its subsidiaries nor any director, officer, agent, employee or other person acting on behalf of the Company or any subsidiary, has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity, (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee, or (iii) violated any provision of the Foreign Corrupt Practices Act of 1977, as amended, or made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic government official or employee. 3.17 Other Issuances of Securities. The Company has not issued (and will not issue) any shares of Common Stock or shares of any series of preferred stock (other than the Preferred Shares) or other securities or instruments convertible into, exchangeable for or otherwise entitling -8- the holder thereof to acquire shares of Common Stock which would be integrated with the sale of the Preferred Shares, or the issuance of the Conversion Shares upon conversion thereof, for purposes of determining whether stockholder approval is required under the designation criteria of the Nasdaq National Market. 4. COVENANTS OF THE COMPANY. 4.1 Corporate Existence. The Company shall, so long as any Purchaser or any affiliate of such Purchaser beneficially owns any Securities, maintain its corporate existence in good standing and shall pay all taxes when due except for taxes which the Company reasonably disputes or which could not reasonably be expected to have a materially adverse change on the consolidated business or financial condition of the Company and its subsidiaries. 4.2 Provision of Information. The Company shall provide each Purchaser with copies of its annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and proxy statements and other materials sent to stockholders, in each such case promptly after filing thereof with the Commission, until the conversion or redemption of all of the Preferred Shares held by such Purchaser. 4.3 Form D; Blue-Sky Qualification. The Company agrees to file a Form D with respect to the Securities as required under Regulation D and to provide a copy thereof to each Purchaser promptly upon filing. The Company shall, on or before the Closing, take such action as is necessary to qualify the Securities for sale under applicable state or "blue-sky" laws or obtain an exemption therefrom, and shall provide evidence of any such action to such Purchaser. 4.4 Reporting Status. As long as such Purchaser or any affiliate of such Purchaser beneficially owns any Securities, and until the date on which any of the foregoing may be sold to the public pursuant to Rule 144(k) (or any successor rule or regulation), (i) the Company shall timely file with the Commission all reports required to be so filed pursuant to the Exchange Act and (ii) the Company shall not terminate its status as an issuer required by the Exchange Act to file reports thereunder even if the Exchange Act or the rules or regulations thereunder would permit such termination. 4.5 Use of Proceeds. The Company shall use the proceeds from the sale of the Preferred Shares for general corporate purposes. 4.6 Listing. The Company shall, as soon as practicable following the Closing, secure the designation and quotation of the Conversion Shares and Dividend Payment Shares on the Nasdaq National Market and shall use its best efforts to maintain the designation of the Common Stock on the Nasdaq National Market, the New York Stock Exchange or the American Stock Exchange. -9- 4.7 Reservation of Common Stock. The Company shall at all times have authorized and reserved for issuance, free from any preemptive rights, solely for the purpose of effecting conversions of the Preferred Shares hereunder, such number of shares of Common Stock as shall from time to time be sufficient to effect the conversion of all of the Preferred Shares then outstanding (the "Reserved Amount"). As of the Closing Date, the Reserved Amount shall be equal to no less than 175% of the number of shares of Common Stock issuable upon conversion of all of the Preferred Shares purchased by the Purchasers at the Closing (assuming for such purpose that the Preferred Shares are convertible in full at such time). If at any time the Reserved Amount is less than 125% of the number of Conversion Shares issuable upon conversion of all of the Preferred Shares then outstanding, the Company shall take immediate action (including seeking stockholder authorization) to increase the Reserved Amount to no less than 175% of the number of Conversion Shares into which such outstanding Preferred Shares are then convertible. No Purchaser shall be issued, upon conversion of a Preferred Shares of Common Stock in an amount greater than the product of (A) the Reserved Amount in effect on the date on which notice of such conversion or exercise is delivered to the Company pursuant to the terms of the Certificate times (B) a fraction, the numerator of which is the number of Preferred Shares purchased by such Purchaser hereunder and the denominator of which is the number of Preferred Shares purchased by the Purchasers hereunder. The Company shall not reduce the number of shares reserved for issuance hereunder without the written consent of the holders of at least 66% of the then outstanding number of Preferred Shares. 4.8 Use of Purchaser Name. The Company shall not use, directly or indirectly, any Purchaser's name in any advertisement, announcement, press release or other similar communication unless it has received the prior written consent of such Purchaser for the specific use contemplated; provided, however, that the Company may respond to inquiries regarding the identity of the Purchasers from securities analysts or the media. 4.9 Company's Instructions to Transfer Agent. On or prior to the Closing, the Company shall execute and deliver irrevocable instructions to its transfer agent (the "Transfer Agent") (i) to issue certificates representing Conversion Shares upon conversion of Preferred Shares in accordance with the terms thereof and receipt of (x) a valid Conversion Notice (as defined in the Certificate) from a Purchaser, and (y) instructions from the Company pursuant to the Certificate regarding the number of Conversion Shares and Dividend Payment Shares (if any) to be issued in the name of such Purchaser or its nominee, (ii) to issue certificates representing the Dividend Payment Shares upon the issuance thereof in accordance with the Certificate and (iii) to deliver such certificates to such Purchaser no later than the close of business on the third (3rd) business day following the related Conversion Date or the Dividend Payment Date (each as defined in the Certificate). The Company represents to and agrees with each Purchaser that it will not give any instruction to the Transfer Agent that will conflict with the foregoing instruction or otherwise restrict such Purchaser's right to convert the Preferred Shares held by such Purchaser or to receive Conversion Shares or Dividend Payment Shares in accordance with the terms of the Certificate. In the event that the Company's relationship with the Transfer Agent should be terminated for any reason, the Transfer Agent shall continue acting as transfer agent pursuant to -10- the terms hereof until such time that a successor transfer agent is appointed by the Company and agrees to be bound by the terms hereof. 5. CONDITIONS TO CLOSING. 5.1 Conditions to Purchaser's Obligations at Closing. Each Purchaser's obligations at the Closing, including without limitation its obligation to purchase the Preferred Shares to be purchased by it hereunder, are conditioned upon the fulfillment of each of the following events: (a) the representations and warranties of the Company set forth in this Agreement shall be true and correct in all material respects as of the Closing Date of as if made on such date; (b) the Company shall have complied with or performed all of the agreements, obligations and conditions set forth in this Agreement that are required to be complied with or performed by the Company on or before the Closing; (c) the Company shall have delivered to such Purchaser a certificate, signed by an officer of the Company, certifying that the conditions specified in paragraphs (a) and (b) above have been fulfilled; (d) the Company shall have delivered to such Purchaser an opinion of counsel for the Company, dated as of the date of the Closing, in the form attached as Exhibit 5.1; (e) The Company shall have filed the Certificate with the Secretary of State of the State of Delaware and furnished such Purchaser with a file-stamped copy thereof; (f) the Company shall have executed and delivered the Registration Rights Agreement; (g) there shall have been no material adverse changes in the Company's consolidated business or financial condition since the date of the Company's most recent financial statements contained in the Disclosure Documents; (h) the Common Stock shall be designated for quotation and actively traded on the Nasdaq National Market; and (j) the Company shall have authorized and reserved for issuance upon conversion of the Preferred Shares 175% of the number of shares of Common Stock issuable upon conversion all of the Preferred Shares issuable at the Closing. -11- 5.2 Conditions to Company's Obligations at Closing. The Company's obligation at the Closing to issue and sell Preferred Shares to a Purchaser hereunder is subject to the satisfaction, at or before the Closing Date, of each of the following conditions. The obligation of the Company to issue and sell Preferred Shares to any Purchaser hereunder is distinct and separate from its obligation to issue and sell Preferred Shares to any other Purchaser hereunder and the failure by one or more Purchasers to fulfill the conditions set forth herein or to consummate the purchase of Preferred Shares hereunder will not relieve the Company of its obligations with respect to any other Purchaser. (a) the representations and warranties of the applicable Purchaser shall be true and correct in all material respects as of the Closing Date as if made on such date; and (b) the applicable Purchaser shall have complied with or performed all of the agreements, obligations and conditions set forth in this Agreement that are required to be complied with or performed by such Purchaser on or before the Closing. 6. INDEMNIFICATION. The Company agrees to indemnify and hold harmless each Purchaser and its officers, directors, employees and agents, and each person who controls the Purchaser within the meaning of the Securities Act or the Exchange Act (each, a "Purchaser Indemnified Party") against any losses, claims, damages, liabilities or reasonable out-of-pocket expenses (including the reasonable fees and disbursements of counsel) as incurred, joint or several, to which it, they or any of them, may become subject and not otherwise reimbursed, arising out of or in connection with the breach by the Company of any of its representations, warranties or covenants made herein; provided, that the Company shall not have any obligation to any Purchaser Indemnified Party with respect to any liability to the extent such liability arises from the gross negligence or willful misconduct on the part of such Purchaser Indemnified Party as determined by a court of competent jurisdiction. Each Purchaser agrees to indemnify and hold harmless the Company and its officers, directors, employees and agents, and each person who controls the Company within the meaning of the Securities Act or the Exchange Act (each, a "Company Indemnified Party") (a Purchaser Indemnified Party and a Company Indemnified Party are each hereinafter referred to as an "Indemnified Party") against any losses, claims, damages, liabilities or expenses (including the fees and disbursements of counsel) as incurred, joint or several, to which it, they or any of them, may become subject and not otherwise reimbursed, arising out of or in connection with the breach by such Purchaser of any of its representations, warranties or covenants made herein; provided, that such Purchaser shall not have any obligation to any Company Indemnified Party with respect to any liability to the extent such liability arises from the gross negligence or willful misconduct on the part of such Company Indemnified Party as determined by a court of competent jurisdiction. -12- Promptly after receipt by an Indemnified Party of notice of the commencement of any action pursuant to which indemnification may be sought hereunder, such Indemnified Party will, if a claim in respect thereof is to be made against the other party (the "Indemnifying Party"), deliver to the Indemnifying Party a written notice of the commencement thereof and the Indemnifying Party shall have the right to participate in and to assume the defense thereof with counsel reasonably selected by the Indemnifying Party, provided, however, that an Indemnified Party shall have the right to retain its own counsel, with the reasonably incurred fees and expenses of such counsel to be paid by the Indemnifying Party, if representation of such Indemnified Party by the counsel retained by the Indemnifying Party would be inappropriate due to actual or potential conflicts of interest under applicable standards of professional conduct between such Indemnified Party and any other party represented by such counsel in such proceeding. The failure to deliver written notice to the Indemnifying Party within a reasonable time of the commencement of any such action will not relieve the Indemnifying Party of any of its obligations hereunder with respect to such action except to the extent such failure is prejudicial to the Indemnifying Party's ability to defend any such action. No Indemnifying Party shall, without the prior written consent of the Indemnified Party, effect any settlement of pending or threatened action in respect of which an Indemnified Party is or could have been a party and indemnity could have been sought hereunder by such Indemnified Party unless such settlement includes an unconditional release of such Indemnified Party from all liability on any claims that are the subject matter of such action. An Indemnifying Party will not be liable for any settlement of any action or claim effected without its written consent. 7. MISCELLANEOUS. 7.1 Survival; Severability. The representations, warranties, covenants and indemnities made by the parties herein shall survive the Closing notwithstanding any due diligence investigation made by or on behalf of the party seeking to rely thereon. In the event that any provision of this Agreement becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, this Agreement shall continue in full force and effect without said provision; provided that in such case the parties shall negotiate in good faith to replace such provision with a new provision which is not illegal, unenforceable or void, as long as such new provision does not materially change the economic benefits of this Agreement to the parties. 7.2 Successors and Assigns. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement. Each Purchaser may assign its rights hereunder, in connection with any private sale or transfer of Preferred Shares, as long as, as a condition precedent to such transfer, the transferee executes an acknowledgment agreeing to be bound by the applicable provisions of this Agreement, in which case the term "Purchaser" shall be deemed to refer to such transferee as though such transferee were an original signatory hereto. -13- 7.3 Independent Nature of Purchasers' Obligations and Rights. The obligations of each Purchaser hereunder are several and not joint with the obligations of the other Purchasers hereunder, and no Purchaser shall be responsible in any way for the performance of the obligations of any other Purchaser hereunder. Nothing contained herein or in any other agreement or document delivered at the Closing, and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any way acting in concert with respect to such obligations or the transactions contemplated by this Agreement. Each Purchaser shall be entitled to protect and enforce its rights, including without limitation the rights arising out of the Certificate, this Agreement or out of the other Transaction Documents, and it shall not be necessary for any other Purchaser to be joined as an additional party in any proceeding for such purpose. 7.4 No Reliance. Each party acknowledges that (i) it has such knowledge in business and financial matters as to be fully capable of evaluating the Certificate, this Agreement, the other Transaction Documents and the transactions contemplated hereby and thereby, (ii) it is not relying on any advice or representation of any other party (other than those contained or described in this Agreement or the other Transaction Documents) in connection with entering into this Agreement, the other Transaction Documents or such transactions, (iii) it has not received from any such party any assurance or guarantee as to the merits (whether legal, regulatory, tax, financial or otherwise) of entering into this Agreement or the other Transaction Documents or the performance of its obligations hereunder and thereunder, and (iv) it has consulted with its own legal, regulatory, tax, business, investment, financial and accounting advisors to the extent that it has deemed necessary, and has entered into this Agreement and the other Transaction Documents based on its own independent judgment and on the advice of its advisors as it has deemed necessary, and not on any view (whether written or oral) expressed by any such party. 7.5 Remedies. The remedies provided to a Purchaser in this Agreement shall be cumulative and in addition to all other remedies available to such Holder hereunder, at law or in equity (including without limitation a decree of specific performance and/or other injunctive relief), no remedy contained herein shall be deemed a waiver of compliance with the provisions giving rise to such remedy and nothing contained herein shall limit such Purchaser's right to pursue actual damages for any failure by the Company to comply with the terms of this Agreement. 7.6 Governing Law. This Agreement shall be governed by and construed under the laws of the State of New York without regard to the conflict of laws provisions thereof. Each party hereby irrevocably submits to the non-exclusive jurisdiction of the state and federal courts sitting in the City of New York, borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, -14- action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. 7.7 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. 7.8 Headings. The headings used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement. 7.9 Notices. Any notice, demand or request required or permitted to be given by the Company or a Purchaser pursuant to the terms of this Agreement shall be in writing and shall be deemed given (i) when delivered personally or by verifiable facsimile transmission (with a hard copy to follow) on or before 5:00 p.m., eastern time, on a business day or, if such day is not a business day, on the next succeeding business day, (ii) on the next business day after timely delivery to an overnight courier and (iii) on the third business day after deposit in the U.S. mail (certified or registered mail, return receipt requested, postage prepaid), addressed to the parties as follows: If to the Company: IGEN International, Inc. 16020 Industrial Drive Gaithersburg, MD 20817 Attn: Messrs. Samuel J. Wohlstadter George V. Migausky Dr. Richard J. Massey Fax: with a copy to: Wilmer, Cutler & Pickering 2445 M Street, N.W. Washington, DC 20037 Attn: Stephen P. Doyle, Esq. Fax: 202-663-6363 -15- and if to any Purchaser, to such address for such Purchaser as shall appear on the signature page hereof executed by such Purchaser, or as shall be designated by such Purchaser in writing to the Company. 7.10 Expenses. Except as otherwise provided herein, each of the Company and the Purchasers shall pay all costs and expenses that it incurs in connection with the negotiation, execution, delivery and performance of this Agreement. 7.11 Entire Agreement; Amendments. This Agreement and the other Transaction Documents (together with the Certificate) constitute the entire agreement between the parties with regard to the subject matter hereof and thereof, superseding all prior agreements or understandings, whether written or oral, between the parties. Except as expressly provided herein, neither this Agreement nor any term hereof may be amended except pursuant to a written instrument executed by the Company and the holders of at least 2/3 of the Preferred Shares then outstanding, and no provision hereof may be waived other than by a written instrument signed by the party against whom enforcement of any such waiver is sought. [Remainder of Page Intentionally Left Blank] -16- IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first-above written. IGEN INTERNATIONAL, INC. By: /s/ George Migausky ----------------------- Name: George Migausky Title: CFO PURCHASER NAME: The Robertson Stephens Black Bear Fund, L.P. By: /s/ Paul H. Stephens ----------------------- Name: Paul H. Stephens Title: General Partner ADDRESS: c/o Robertson Stephens Funds 555 California St., Ste. 2600 San Francisco, CA 94104 Attn: Rick Barry Tel: 415-693-3320 Fax: 415-248-4213 WITH COPIES OF NOTICES SENT TO: c/o Paine Webber 1283 Avenue of Americas, 10th Floor New York, NY 10019 Attn: Jose Rosales- Prime Broker Dept. Tel: 212-713-3200 Fax: 212-713-3217 NUMBER OF PREFERRED SHARES TO BE PURCHASED: 2,560 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of Certificate.. -17- PURCHASER NAME: The Robertson Stephens Black Bear Offshore Fund, L.P. By: /s/ Paul H. Stephens ----------------------- Name: Paul H. Stephens Title: General Partner ADDRESS: c/o Robertson Stephens Funds 555 California St., Ste. 2600 San Francisco, CA 94104 Attn: Rick Barry Tel: 415-693-3320 Fax: 415-248-4213 WITH COPIES OF NOTICES SENT TO: c/o Paine Webber 1283 Avenue of Americas, 10th Floor New York, NY 10019 Attn: Jose Rosales- Prime Broker Dept. Tel: 212-713-3200 Fax: 212-713-3217 NUMBER OF PREFERRED SHARES TO BE PURCHASED: 615 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of Certificate.. -17- PURCHASER NAME: The Robertson Stephens Black Bear Pacific Master Fund Unit Trust By: /s/ Paul H. Stephens -------------------------- Name: Paul H. Stephens Title: General Partner ADDRESS: c/o Robertson Stephens Funds 555 California St., Ste. 2600 San Francisco, CA 94104 Attn: Rick Barry Tel: 415-693-3320 Fax: 415-248-4213 WITH COPIES OF NOTICES SENT TO: c/o Paine Webber 1283 Avenue of Americas, 10th Floor New York, NY 10019 Attn: Jose Rosales- Prime Broker Dept. Tel: 212-713-3200 Fax: 212-713-3217 NUMBER OF PREFERRED SHARES TO BE PURCHASED: 325 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of Certificate.. -17- PURCHASER NAME: Credit Suisse First Boston Corporation By: /s/ Thomas F.X. O'Mara ----------------------------- Name: Thomas F.X. O'Mara Title: Managing Director ADDRESS: Michael [Illegible], Thomas F.X. O'Mara Credit Suisse First Boston Corp. 11 Madison Avenue, 3rd Floor New York, NY 10010 Tel: 212-325-3399 Fax: 212-325-8077 WITH COPIES OF NOTICES SENT TO: Raymond J. Dorado, Esq. Credit Suisse First Boston Corp. 11 Madison Avenue, 3rd Floor New York, NY 10010 Tel: 212-325-7258 Fax: 212-325-8102 NUMBER OF PREFERRED SHARES TO BE PURCHASED: 2,000 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of Certificate.. -17- PURCHASER NAME: Permal Noscal, Ltd. By: /s/ Sanford J. Colen ----------------------- Name: Sanford J. Colen Title: Manager & Principal Apex Capital, LLC ADDRESS: Apex Capital, LLC Pine Grove & Orinda Way, Suite 240-B Orinda, CA 94563 Tel: 510-253-1800 Fax: 510-253-1809 WITH COPIES OF NOTICES SENT TO: Tel: Fax: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 3,000,000 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of Certificate.. -17- PURCHASER NAME: Zaxis Partners, L.P. By: /s/ Sanford J. Colen ----------------------- Name: Sanford J. Colen Title: Manager & Principal Apex Capital, LLC-General Partner ADDRESS: Apex Capital, LLC Pine Grove & Orinda Way, Suite 240-B Orinda, CA 94563 Tel: 510-253-1800 Fax: 510-253-1809 WITH COPIES OF NOTICES SENT TO: Tel: Fax: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 375,000 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of Certificate.. -17- PURCHASER NAME: Sidney Kimmel By: /s/ Sanford J. Colen ----------------------- Name: Sanford J. Colen Title: Manager & Principal Apex Capital, LLC ADDRESS: Apex Capital, LLC Pine Grove & Orinda Way, Suite 240-B Orinda, CA 94563 Tel: 510-253-1800 Fax: 510-253-1809 WITH COPIES OF NOTICES SENT TO: Tel: Fax: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 245,000 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of Certificate.. -17- PURCHASER NAME: Pollat, Evans & Co. Inc. By: /s/ Sanford J. Colen ------------------------ Name: Sanford J. Colen Title: Manager & Principal Apex Capital, LLC ADDRESS: Apex Capital, LLC Pine Grove & Orinda Way, Suite 240-B Orinda, CA 94563 Tel: 510-253-1800 Fax: 510-253-1809 WITH COPIES OF NOTICES SENT TO: Tel: Fax: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 85,000 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of Certificate.. -17- PURCHASER NAME: Quadra Appreciation Fund, Inc. By: /s/ Sanford J. Colen ----------------------- Name: Sanford J. Colen Title: Manager & Principal Apex Capital, LLC ADDRESS: Apex Capital, LLC Pine Grove & Orinda Way, Suite 240-B Orinda, CA 94563 Tel: 510-253-1800 Fax: 510-253-1809 WITH COPIES OF NOTICES SENT TO: Tel: Fax: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 35,000 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of Certificate.. -17- PURCHASER NAME: Peter W. Branagh and Ramona Y. Branagh Trustee for the Peter W. Branagh and Ramona Y. Branagh Revocable Trust, dated March 8, 1993 By: /s/ Sanford J. Colen ----------------------- Name: Sanford J. Colen Title: Manager and Principal Apex Capital, LLC ADDRESS: Apex Capital, LLP Pine Grove & Orinda Way Suite 240-B Orinda, CA 94563 Tel: 510-253-1800 Fax: 510-253-1809 WITH COPIES OF NOTICES SENT TO: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 10,000 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: KA Investments LDC By: /s/ [Authorized Investment Advisor] By: /s/ Kelly Ireland ----------------------------------- -------------------- Name: [Illegible] Name: Kelly Ireland Title: Title: ADDRESS: KA Investments LDC Butterfield House, Fort Street P.O. Box 705 Georgetown, Grand Cayman Cayman Islands, B.W.I. Tel: 345-969-7055 Fax: 345-969-7006 WITH COPIES OF NOTICES SENT TO: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 2,000 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: Gleneagles By: The Palladin Group, L.P. Title: Investment Advisor By: /s/ Brian A. Swain ---------------------- Name: Brian A. Swain Title: Managing Director ADDRESS: 40 West 57th Street, 15th Floor New York, NY 10019 Tel: 212-698-0570 Fax: 212-698-0599 WITH COPIES OF NOTICES SENT TO: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 125 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: Colonial Penn By: The Palladin Group, L.P. Title: Investment Advisor By: /s/ Brian A. Swain ---------------------- Name: Brian A. Swain Title: Managing Director ADDRESS: 40 West 57th Street, 15th Floor New York, NY 10019 Tel: 212-698-0570 Fax: 212-698-0599 WITH COPIES OF NOTICES SENT TO: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 125 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: Putnam Health Sciences Trust By: /s/ John Verani ---------------------- Name: John Verani Title: Vice President ADDRESS: One Post Office Square Boston, Massachusetts 02109 Tel: 1-800-225-2465 Fax: (617) 760-8349 WITH COPIES OF NOTICES SENT TO: David Carlson One Post Office Square Boston, MA 02109 Tel: 1-800-225-2465 Fax: (617) 292-1784 NUMBER OF PREFERRED SHARES TO BE PURCHASED: 4000 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: Porter Partners, L.P. By: /s/ Jeff Porter ---------------------- Name: Jeff Porter Title: General Partner ADDRESS: 100 Shoreline Hwy., Suite 211B Mill Valley, CA 94941 Tel: (415) 332-4466 Fax: (415) 332-8223 WITH COPIES OF NOTICES SENT TO: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 1,250 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: EDJ Limited By: /s/ Jeff Porter ---------------------- Name: Jeff Porter Title: Investment Advisor ADDRESS: Deltec Panamerica Trust Co. Deltec House, Lyford Cay P.O. Box N-3229 Nassau The Bahamas Tel: (242) 362-4549 Fax: (242) 362-4623 WITH COPIES OF NOTICES SENT TO: Jeff Porter Porter Capital Management Co. 100 Shoreline Hwy., Suite 211B Mill Valley, CA 94941 Tel: (415) 332-4466 Fax: (415) 332-8223 NUMBER OF PREFERRED SHARES TO BE PURCHASED: 250 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: White Rock Capital Offshore, Ltd. By: /s/ Timothy U. Barton ---------------------- Name: Timothy U. Barton Title: ADDRESS: 3131 Turtle Creek Blvd. Suite 800 Dallas, TX 75219 Tel: 214-526-1465 Fax: 214-526-0856 WITH COPIES OF NOTICES SENT TO: Moore Stephens International (BVI) Limited Main Street, Abbott Building P.O. Box 3186 Road Town, Tortle British Virgin Islands Tel: 284-494-3503 Fax: 284-494-3592 NUMBER OF PREFERRED SHARES TO BE PURCHASED: 600 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: Quantum Partners LDC By: /s/ Timothy U. Barton ---------------------- Name: Timothy U. Barton Title: ADDRESS: 3131 Turtle Creek Blvd. Suite 800 Dallas, TX 75219 Tel: 214-526-1465 Fax: 214-526-0856 WITH COPIES OF NOTICES SENT TO: Soros Fund Management LLC Attn: Mike Tufano 888 Seventh Avenue New York, NY 10106 Tel: 212-397-5571 Fax: 212-399-0569 NUMBER OF PREFERRED SHARES TO BE PURCHASED: 2,500 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: Collins Capital Diversified Fund, L.P. By: /s/ Timothy U. Barton ---------------------- Name: Timothy U. Barton Title: ADDRESS: c/o White Rock Capital 3131 Turtle Creek Blvd. Suite 800 Dallas, TX 75219 Tel: 214-526-1465 Fax: 214-526-0856 WITH COPIES OF NOTICES SENT TO: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 400 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: White Rock Capital Partners, L.P. By: /s/ White Rock Capital Management, L.P. --------------------------------------- Name: White Rock Capital Management By: /s/ White Rock Capital, Inc. ----------------------------- Name: White Rock Capital, Inc. By: /s/ Timothy U. Barton ---------------------- Name: Timothy U. Barton Title: President ADDRESS: 3131 Turtle Creek Blvd. Suite 800 Dallas, TX 75219 Tel: 214-526-1465 Fax: 214-526-0856 WITH COPIES OF NOTICES SENT TO: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 1,000 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: Prism Partners I By: /s/ Jerald M. Weintraub ------------------------- Name: Jerald M. Weintraub Title: Managing General Partner of Prism Partners I ADDRESS: 909 Montgomery Street Suite 400 San Francisco, CA 94133 Tel: 415-705-8787 Fax: 415-705-8736 WITH COPIES OF NOTICES SENT TO: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 1,500 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: GPZ Trading By: /s/ John S. Stafford III --------------------------- Name: John S. Stafford III Title: Member ADDRESS: 230 S. LaSalle Street Suite 688 Chicago, IL 60604-1408 Tel: 312-294-2721 Fax: 312-294-4450 WITH COPIES OF NOTICES SENT TO: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 500 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: Triton Capital Investments By: Inter Caribbean Services Limited By: /s/ [Authorized Officer] ------------------------ Name: [Illegible] Title: Secretary ADDRESS: 1999 Avenue of the Stars Suite 1950 Los Angeles, CA 90067 Tel: 310-201-2614 Fax: 310-201-2759 WITH COPIES OF NOTICES SENT TO: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 750 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- PURCHASER NAME: JMG Capital Partners, L.P. By: /s/ Jonathan Glaser ---------------------- Name: Jonathan Glaser Title: General Partner ADDRESS: 1999 Avenue of the Stars Suite 1950 Los Angeles, CA 90067 Tel: 310-201-2619 Fax: 310-201-2759 WITH COPIES OF NOTICES SENT TO: NUMBER OF PREFERRED SHARES TO BE PURCHASED: 750 / / Check here if Purchaser does not intend to be bound by the 4.9% limitation contained in subparagraph II.G.2 of the Certificate. -17- EX-4.3 4 EXHIBIT 4.3 Exhibit 4.3 REGISTRATION RIGHTS AGREEMENT REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of December 16, 1997, by and among IGEN International, Inc., a Delaware corporation (the "Company"), and each of the entities whose names appear on the signature pages hereof. Such entities are each referred to herein as a "Purchaser" and, collectively, as the "Purchasers". The Company has agreed, on the terms and subject to the conditions set forth in the Purchase Agreement of even date herewith (the "Purchase Agreement"), to issue and sell to each Purchaser shares (the "Preferred Shares") of the Company's Series B Convertible Preferred Stock (the "Preferred Stock"). The Preferred Shares are convertible pursuant to the Company's Certificate of Designation (the "Certificate") into shares (the "Conversion Shares") of the Company's Common Stock (the "Common Stock"). In order to induce the Purchasers to enter into the Purchase Agreement, the Company has agreed to provide certain registration rights under the Securities Act of 1933, as amended (the "Securities Act"), and under applicable state securities laws. Capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Purchase Agreement. In consideration of each Purchaser entering into the Purchase Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 1. DEFINITIONS. For purposes of this Agreement, the following terms shall have the meanings specified: (a) "Closing" shall have the meaning specified in the Purchase Agreement; (b) "Registration Deadline" means the ninetieth (90th) day following Closing; (c) "Holder" means any person owning or having the right to acquire, through conversion of Preferred Shares or otherwise, Registrable Securities, including initially each Purchaser and thereafter any permitted assignee thereof; (d) "Register", "registered" and "registration" refer to a registration effected by preparing and filing a registration statement or statements in compliance with the Securities Act and pursuant to Rule 415 under the Securities Act ("Rule 415") or any successor rule providing for the offering of securities on a continuous basis ("Registration Statement"), and the declaration or ordering of effectiveness of the Registration Statement by the Securities and Exchange Commission (the "Commission"); and (e) "Registrable Securities" means the Conversion Shares and the Dividend Payment Shares (as defined in the Certificate), and any other shares of Common Stock issuable pursuant to the terms of the Certificate, whether as payment of a redemption price or otherwise, and any shares of capital stock issued or issuable from time to time (with any adjustments) in replacement of, in exchange for or otherwise in respect of the Conversion Shares or the Dividend Payment Shares. 2. MANDATORY REGISTRATION. (a) On or before the forty-fifth (45th) day following Closing, the Company shall prepare and file with the Commission a Registration Statement on Form S-3 as a "shelf" registration statement under Rule 415 covering the resale of at least 200% of the number of shares of Registrable Securities then issuable on conversion of all of the Preferred Shares issued at the Closing. The Registration Statement shall state, to the extent permitted by Rule 416 under the Securities Act, that it also covers such indeterminate number of shares of Common Stock as may be required to effect conversion of the Preferred Shares to prevent dilution resulting from stock splits, stock dividends or similar events, or by reason of changes in the Conversion Price in accordance with the terms of the Certificate. (b) The Company shall use its best efforts to cause the Registration Statement to become effective as soon as practicable following the filing thereof, but in no event later than the Registration Deadline, and shall submit to the Commission, within five (5) business days after the Company learns that no review of the Registration Statement will be made by the staff of the Commission or that the staff of the Commission has no further comments on the Registration Statement, as the case may be, a request for acceleration of the effectiveness of the Registration Statement to a time and date not later than forty-eight (48) hours after the submission of such request, and maintain the effectiveness of the Registration Statement until the earlier to occur of (i) the date on which all of the Registrable Securities have been sold pursuant to the Registration Statement and (ii) the date on which all of the remaining Registrable Securities (in the reasonable opinion of counsel to the Purchaser) may be immediately sold to the public without registration and without regard to the amount of Registrable Securities which may be sold by a Holder thereof at a given time (the "Registration Period"). (c) If (A) the Registration Statement is not declared effective by the Commission on or before the Registration Deadline, (B) after the Registration Statement has been declared effective by the Commission, sales of Registrable Securities cannot be made by a Holder under the Registration Statement for any reason not within the exclusive control of such Holder (other than such Registrable Securities as are then freely saleable pursuant to Rule 144(k) under the Securities Act), (C) the Common Stock is not included for quotation on the Nasdaq Stock -2- Market ("Nasdaq") or listed on the New York Stock Exchange or other national securities exchange at any time after the Registration Deadline, the Company shall pay to each Holder an amount (a "Registration Default Payment") equal to the lesser of (x) two percent (2%) per month and (y) the highest rate permitted by applicable law, times the Liquidation Preference (as defined in the Certificate) of the Preferred Shares held by such Holder, accruing daily and compounded monthly, from the Registration Deadline or, where the Registration Statement has become effective, from the date on which the Registration Statement lapses or is otherwise unavailable, or the from the date on which Common Stock is no longer so quoted or listed, until the date on which the Registration Statement is declared effective or becomes available for sales of Registrable Securities or the date on which the Common Stock is included for quotation on Nasdaq or such other national securities exchange, as the case may be; provided, however, that if the Registration Statement is not declared effective by the Registration Deadline, and such delay is not due to a failure by the Company to use its best efforts to cause the Registration Statement to become effective, including without limitation a failure to respond promptly to comments by the Commission on the Registration Statement, the Registration Deadline shall be extended for an additional thirty (30) days; and provided, further, that in no event shall the aggregate of all Registration Default Payments made by the Company hereunder exceed three million dollars ($3,000,000). The Registration Default Payments paid or payable by the Company hereunder shall be in addition to any other remedies available to a Holder at law or in equity or pursuant to the terms of the Certificate or any other Transaction Document. Registration Default Payments shall be made within five (5) days after the end of each period that gives rise to such obligation, provided that, if any such period extends for more than thirty (30) days, payments shall be made at the end of each thirty-day period. 3. PIGGYBACK REGISTRATION. If at any time prior to the expiration of the Registration Period, (i) the Company proposes to register shares of Common Stock under the Securities Act in connection with the public offering of such shares for cash (other than a registration relating solely to the sale of securities to participants in a Company stock plan or employee stock award or a registration on Form S-4 under the Securities Act or any successor or similar form registering stock issuable upon a reclassification, a business combination involving an exchange of securities or an exchange offer for securities of the issuer or another entity) (a "Proposed Registration") and (ii) a registration statement covering the sale of all of the Registrable Securities is not then effective and available for sales thereof by the Holders, the Company shall, at such time, promptly give each Holder written notice of such Proposed Registration. Each Holder shall have thirty (30) days from its receipt of such notice to deliver to the Company a written request specifying the amount of Registrable Securities that such Holder intends to sell and such Holder's intended method of distribution. Upon receipt of such request, the Company shall use its best efforts to cause all Registrable Securities which the Company has been requested to register to be registered under the Securities Act to the extent necessary to permit their sale or other disposition in accordance with the intended methods of distribution specified in the request of such Holder; provided, however, that the Company shall have the right to postpone or withdraw any registration effected -3- pursuant to this Section 3 without obligation to the Holder. If, in connection with any underwritten public offering for the account of the Company, the managing underwriter(s) thereof shall impose a limitation on the number of shares of Common Stock which may be included in the Registration Statement because, in such underwriter(s)' judgment, marketing or other factors dictate such limitation is necessary to facilitate public distributions, then the Company shall be obligated to include in such Registration Statement only such limited portion of the Registrable Securities with respect to which each Holder has requested inclusion hereunder as such underwriter(s) shall permit. Any exclusion of Registrable Securities shall be made pro rata among the Holders seeking to include Registrable Securities in the Registration Statement, in proportion to the number of Registrable Securities sought to be included by such Holders; provided, however, that the Company shall not exclude any Registrable Securities unless the Company has first excluded all outstanding securities, the holders of which are not entitled to inclusion of such securities in such Registration Statement or are not entitled to pro rata inclusion with the Registrable Securities; and provided, further, however, that, after giving effect to the immediately preceding proviso, any exclusion of Registrable Securities shall be made pro rata with holders of other securities having the right to include such securities in the Registration Statement. 4. OBLIGATIONS OF THE COMPANY. In addition to performing its obligations hereunder, including those pursuant to paragraphs 2(a) and 2(b) above, the Company shall: (a) prepare and file with the Commission such amendments and supplements to the Registration Statement and the prospectus used in connection with the Registration Statement as may be necessary to comply with the provisions of the Securities Act or to maintain the effectiveness of the Registration Statement during the Registration Period, or as may be reasonably requested by a Holder in order to incorporate information concerning such Holder or such Holder's intended method of distribution; (b) in the event that the number of shares available under the Registration Statement filed by the Company hereunder is insufficient during any period of three consecutive trading days to cover 150% of the Registrable Securities then issued or issuable, the Company shall promptly amend the Registration Statement, or file a new Registration Statement, or both, so as to cover 200% of such Registrable Securities, in any event as soon as practicable, but not later than the tenth business day following the last day of such three day period. Any Registration Statement filed pursuant to this Section 4 shall state that, to the extent permitted by Rule 416 under the Securities Act, such Registration Statement also covers such indeterminate number of additional shares of Common Stock as may become issuable upon conversion of the Debentures. Unless and until such amendment or new Registration Statement becomes effective, each Holder shall have the rights described in paragraph 2(c) above; -4- (c) secure the designation and quotation of the Registrable Securities on the Nasdaq Stock Market or the listing thereof on the New York Stock Exchange or the American Stock Exchange; (d) furnish to each Holder such number of copies of the prospectus included in such Registration Statement, including a preliminary prospectus, in conformity with the requirements of the Securities Act, and such other documents as such Holder may reasonably request in order to facilitate the disposition of such Holder's Registrable Securities; (e) use all commercially reasonable efforts to register or qualify the Registrable Securities under the securities or "blue sky" laws of such jurisdictions within the United States as shall be reasonably requested from time to time by a Holder, and do any and all other acts or things which may be necessary or advisable to enable such Holder to consummate the public sale or other disposition of the Registrable Securities in such jurisdictions; provided that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business or to file a general consent to service of process in any such jurisdiction; (f) in the event of an underwritten public offering of the Registrable Securities pursuant to Sections 2 or 3 hereof, enter into and perform its obligations under an underwriting agreement, in usual and customary form reasonably acceptable to the Company, with the managing underwriter of such offering; (g) notify each Holder immediately upon the occurrence of any event as a result of which the prospectus included in such Registration Statement, as then in effect, contains an untrue statement of material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing, and as promptly as practicable, prepare, file and furnish to each Holder a reasonable number of copies of a supplement or an amendment to such prospectus as may be necessary so that such prospectus does not contain an untrue statement of material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing; (h) use all commercially reasonable efforts to prevent the issuance of any stop order or other order suspending the effectiveness of such Registration Statement and, if such an order is issued, to obtain the withdrawal thereof at the earliest possible time and to notify each Holder of the issuance of such order and the resolution thereof; (i) furnish to each Holder, on the date that such Registration Statement becomes effective, (x) an opinion, dated such date, of outside counsel representing the Company (and reasonably acceptable to such Holder) addressed to such Holder, regarding the effectiveness of the Registration Statement and the absence of any stop order, and (y) in the case of an underwriting pursuant to Sections 2 or 3 hereof, (A) an opinion, dated such date, of such outside counsel, in form and substance as is customarily given to underwriters in an underwritten public -5- offering, and (B) a letter, dated such date, from the Company's independent certified public accountants, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering, addressed to the underwriters, if any, and to each Holder; (j) provide each Holder and its representatives the opportunity to conduct a reasonable inquiry of the Company's financial and other records during normal business hours and make available its officers, directors and employees for questions regarding information which such Holder may reasonably request in order to fulfill any due diligence obligation on its part; and (k) permit counsel for each Holder (at such Holder's expense) to review such Registration Statement and all amendments and supplements thereto a reasonable period of time prior to the filing thereof with the Commission. 5. OBLIGATIONS OF EACH HOLDER. In connection with the registration of the Registrable Securities pursuant to the Registration Statement, each Holder shall: (a) furnish to the Company in writing such information regarding itself and the intended method of disposition of Registrable Securities as the Company shall reasonably request in order to effect the registration thereof; (b) upon receipt of any notice from the Company of the happening of any event of the kind described in paragraph 4(g) or 4(h), immediately discontinue disposition of Registrable Securities pursuant to the Registration Statement until the filing of the supplement or amendment referred to in paragraph 4(g) or withdrawal of the stop order referred to in paragraph 4(h); and (c) in the event of an underwritten offering of the Registrable Securities pursuant to Sections 2 or 3 hereof, enter into a customary and reasonable underwriting agreement and execute such other documents as the managing underwriter for such offering may reasonably request. 6. INDEMNIFICATION. In the event that any Registrable Securities are included in a Registration Statement under this Agreement: (a) To the extent permitted by law, the Company shall indemnify and hold harmless each Holder, the officers, directors, employees, agents and representatives of such Holder, and each person, if any, who controls such Holder within the meaning of the Securities Act or the Securities Exchange Act of 1934, as amended (the "1934 Act"), against any losses, claims, damages, liabilities or reasonable out-of-pocket expenses (whether joint or several) -6- (collectively, including legal or other expenses reasonably incurred in connection with investigating or defending same, "Losses"), insofar as any such Losses arise out of or are based upon (i) any untrue statement or alleged untrue statement of a material fact contained in such Registration Statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, or (ii) the omission or alleged omission to state therein a material fact required to be stated therein, or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. The Company will reimburse such Holder, and each such officer, director, employee, agent, representative or controlling person for any legal or other expenses as reasonably incurred by any such entity or person in connection with investigating or defending any Loss; provided, however, that the foregoing indemnity shall not apply to amounts paid in settlement of any Loss if such settlement is effected without the consent of the Company (which consent shall not be unreasonably withheld), nor shall the Company be obligated to indemnify any person for any Loss to the extent that such Loss arises out of or is based upon and in conformity with written information furnished by such person expressly for use in such Registration Statement; and provided, further, that the Company shall not be required to indemnify any person to the extent that any Loss results from such person selling Registrable Securities (i) to a person to whom there was not sent or given, at or prior to the written confirmation of the sale of such shares, a copy of the prospectus, as most recently amended or supplemented, if the Company has previously furnished or made available copies thereof or (ii) during any period following written notice by the Company to such Holder of an event described in Section 4(g) or 4(h). (b) To the extent permitted by law, each Holder, acting severally and not jointly, shall indemnify and hold harmless the Company, the officers, directors, employees, agents and representatives of the Company, and each person, if any, who controls the Company within the meaning of the Securities Act or the 1934 Act, against any Losses to the extent (and only to the extent) that any such Losses arise out of or are based upon and in conformity with written information furnished by such Holder expressly for use in such Registration Statement; and such Holder will reimburse any legal or other expenses as reasonably incurred by the Company and any such officer, director, employee, agent, representative, or controlling person, in connection with investigating or defending any such Loss; provided, however, that the foregoing indemnity shall not apply to amounts paid in settlement of any such Loss if such settlement is effected without the consent of such Holder, which consent shall not be unreasonably withheld; provided, that, in no event shall any indemnity under this subsection 6(b) exceed the net purchase price of securities sold by such Holder under the Registration Statement. (c) Promptly after receipt by an indemnified party under this Section 6 of notice of the commencement of any action (including any governmental action), such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Section 6, deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying party shall have the right to participate in and to assume the defense thereof with counsel mutually satisfactory to the parties; provided, however, that an indemnified party shall have the right to retain its own counsel, with the reasonably incurred fees and expenses of one -7- such counsel to be paid by the indemnifying party, if representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate under applicable standards of professional conduct due to actual or potential conflicting interests between such indemnified party and any other party represented by such counsel in such proceeding. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action, to the extent prejudicial to its ability to defend such action, shall relieve such indemnifying party of any liability to the indemnified party under this Section 6 with respect to such action, but the omission so to deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Section 6 or with respect to any other action. (d) In the event that the indemnity provided in paragraph (a) or (b) of this Section 6 is unavailable or insufficient to hold harmless an indemnified party for any reason, the Company and each Holder agree, severally and not jointly, to contribute to the aggregate Losses to which the Company or such Holder may be subject in such proportion as is appropriate to reflect the relative fault of the Company and such Holder in connection with the statements or omissions which resulted in such Losses; provided, however, that in no case shall such Holder be responsible for any amount in excess of the net purchase price of securities sold by it under the Registration Statement. Relative fault shall be determined by reference to whether any alleged untrue statement or omission relates to information provided by the Company or by such Holder. The Company and each Holder agree that it would not be just and equitable if contribution were determined by pro rata allocation or any other method of allocation which does not take account of the equitable considerations referred to above. Notwithstanding the provisions of this paragraph (d), no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who is not guilty of such fraudulent misrepresentation. For purposes of this Section 6, each person who controls a Holder within the meaning of either the Securities Act or the Exchange Act and each officer, director, employee, agent or representative of such Holder shall have the same rights to contribution as such Holder, and each person who controls the Company within the meaning of either the Securities Act or the Exchange Act and each officer, director, employee, agent or representative of the Company shall have the same rights to contribution as the Company, subject in each case to the applicable terms and conditions of this paragraph (d). (e) The obligations of the Company and each Holder under this Section 6 shall survive the conversion or redemption, if any, of the Preferred Shares, the completion of any offering of Registrable Securities pursuant to a Registration Statement under this Agreement, or otherwise. -8- 7. REPORTS. With a view to making available to each Holder the benefits of Rule 144 under the Securities Act ("Rule 144") and any other similar rule or regulation of the Commission that may at any time permit such Holder to sell securities of the Company to the public without registration, the Company agrees to: (a) make and keep public information available, as those terms are understood and defined in Rule 144; (b) file with the Commission in a timely manner all reports and other documents required of the Company under the Securities Act and the 1934 Act; and (c) furnish to such Holder, so long as such Holder owns any Registrable Securities, forthwith upon request (i) a written statement by the Company, if true, that it has complied with the reporting requirements of Rule 144, the Securities Act and the 1934 Act, (ii) a copy of the most recent annual or quarterly report of the Company and such other reports and documents so filed by the Company, and (iii) such other information as may be reasonably requested in availing such Holder of any rule or regulation of the Commission which permits the selling of any such securities without registration. 8. MISCELLANEOUS. (a) Expenses of Registration. All expenses, other than underwriting discounts and commissions and fees and expenses of counsel to each Holder, incurred in connection with the registrations, filings or qualifications described herein, including (without limitation) all registration, filing and qualification fees, printers' and accounting fees, the fees and disbursements of counsel for the Company, and the fees and disbursements incurred in connection with the opinion and letter described in paragraph 4(i) hereof, shall be borne by the Company. (b) Amendment; Waiver. Any provision of this Agreement may be amended only pursuant to a written instrument executed by the Company and Holders of two-thirds (2/3) of the outstanding Registrable Securities. Any waiver of the provisions of this Agreement may be made only pursuant to a written instrument executed by the party against whom enforcement is sought. Any amendment or waiver effected in accordance with this paragraph shall be binding upon each Holder, each future Holder, and the Company. The failure of any party to exercise any right or remedy under this Agreement or otherwise, or the delay by any party in exercising such right or remedy, shall not operate as a waiver thereof. (c) Notices. Any notice, demand or request required or permitted to be given by any party to any other party pursuant to the terms of this Agreement shall be in writing and shall be deemed given (i) when delivered personally or by verifiable facsimile transmission (with an original to follow) on or before 5:00 p.m., eastern time, on a business day or, if such day is -9- not a business day, on the next succeeding business day, (ii) on the next business day after timely delivery to a nationally-recognized overnight courier and (iii) on the third business day after deposit in the U.S. mail (certified or registered mail, return receipt requested, postage prepaid), addressed to the parties as follows: If to the Company: IGEN International, Inc. 16020 Industrial Drive Gaithersburg, MD 20817 Attn: Messrs. Samuel J. Wohlstadter George V. Migausky Dr. Richard J. Massey Fax: with a copy to: Wilmer, Cutler & Pickering 2445 M Street, N.W. Washington, DC 20037 Attn: Stephen P. Doyle, Esq. Fax: 202-663-6363 and if to any Holder, to such address as shall be designated by such Holder in writing to the Company. (d) Termination. This Agreement shall terminate on the earlier to occur of (a) the end of the Registration Period and (b) the date on which all of the Registrable Securities have been publicly distributed; but any such termination shall be without prejudice to (i) the parties' rights and obligations arising from breaches of this Agreement occurring prior to such termination and (ii) the indemnification and contribution obligations under this Agreement. (e) Assignment. The rights of a Holder hereunder shall be assigned automatically to any transferee of the Preferred Shares or Registrable Securities from such Holder as long as: (i) the Company is, within a reasonable period of time following such transfer, furnished with written notice of the name and address of such transferee, (ii) the transferee agrees in writing with the Company to be bound by all of the provisions hereof and (iii) such transfer is made in accordance with the applicable requirements of the Purchase Agreement and the Certificate. (f) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, and all of which together shall be deemed -10- one and the same instrument. This Agreement, once executed by a party, may be delivered to any other party hereto by facsimile transmission. (g) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York without regard to the conflict of laws provisions thereof. -11- IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first-above written. IGEN INTERNATIONAL, INC. By: /s/ George Migausky ------------------------- Name: George Migausky Title: CFO PURCHASER NAME: The Robertson Stephens Black Bear Fund, L.P. By: /s/ Paul H. Stephens ------------------------- Name: Paul H. Stephens Title: General Partner PURCHASER NAME: The Robertson Stephens Black Bear Offshore Fund, L.P. By: /s/ Paul H. Stephens ------------------------- Name: Paul H. Stephens Title: General Partner PURCHASER NAME: The Robertson Stephens Black Bear Pacific Master Fund Unit Trust By: /s/ Paul H. Stephens -------------------------- Name: Paul H. Stephens Title: General Partner PURCHASER NAME: Credit Suisse First Boston Corporation By: /s/ Thomas F.X. O'Mara ---------------------------- Name: Thomas F.X. O'Mara Title: Managing Director -11- PURCHASER NAME: Permal Noscal, Ltd. By: /s/ Sanford J. Colen -------------------------- Name: Sanford J. Colen Title: Manager and Principal Apex Capital, LLC PURCHASER NAME: Zaxis Partners, L.P. By: /s/ Sanford J. Colen ------------------------- Name: Sanford J. Colen Title: Manager and Principal Apex Capital, LLC - General Partner PURCHASER NAME: Sidney Kimmel By: /s/ Sanford J. Colen ------------------------- Name: Sanford J. Colen Title: Manager and Principal Apex Capital, LLC PURCHASER NAME: Pollat, Evans & Co., Inc. By: /s/ Sanford J. Colen ------------------------- Name: Sanford J. Colen Title: Manager and Principal Apex Capital, LLC PURCHASER NAME: Quadra Appreciation Fund, Inc. By: /s/ Sanford J. Colen ------------------------- Name: Sanford J. Colen Title: Manager and Principal Apex Capital, LLC -11- PURCHASER NAME: Peter W. Branagh & Ramona Y. Branagh Trustee for the Peter W. Branagh & Ramona Y. Branagh Revocable Trust, dated March 8, 1993 By: /s/ Sanford J. Colen ------------------------- Name: Sanford J. Colen Title: Manager and Principal Apex Capital, LLC PURCHASER NAME: KA Investments LDC By: /s/ [Authorized Investment Advisor] /s/ Kelly Ireland ----------------------------------- ------------------------- Name: [Illegible] Name: Kelly Ireland Title: Title: PURCHASER NAME: Gleneagles Fund By: Palladin Group L.P. Title: Investment Advisor By: /s/ Brian A. Swain --------------------------- Name: Brian A. Swain Title: Managing Director PURCHASER NAME: Colonial Penn Life By: Palladin Group L.P. Title: Investment Advisor By: /s/ Brian A. Swain ---------------------- Name: Brian A. Swain Title: Managing Director PURCHASER NAME: Putnam Health Sciences Trust By: /s/ John Verani ------------------------- Name: John Verani Title: Vice President -11- PURCHASER NAME: Porter Partners, L.P. By: /s/ Jeff Porter ------------------------- Name: Jeff Porter Title: General Partner PURCHASER NAME: EDJ Limited By: /s/ Jeff Porter ------------------------- Name: Jeff Porter Title: Investment Advisor PURCHASER NAME: White Rock Capital Offshore, Ltd. By: /s/ Timothy U. Barton ------------------------- Name: Timothy U. Barton Title: PURCHASER NAME: Quantum Partners LDC By: /s/ Timothy U. Barton ------------------------- Name: Timothy U. Barton Title: PURCHASER NAME: Collins Capital Diversified Fund, L.P. By: /s/ Timothy U. Barton ------------------------- Name: Timothy U. Barton Title: PURCHASER NAME: White Rock Capital Partners, L.P. By: /s/ Timothy U. Barton ------------------------- Name: Timothy U. Barton Title: -11- PURCHASER NAME: Prism Partners I By: /s/ Jerald M. Weintraub ------------------------ Name: Jerald M. Weintraub Title: Managing General Partner PURCHASER NAME: GPZ Trading By: /s/ John S. Stafford III ------------------------- Name: John S. Stafford III Title: Member PURCHASER NAME: Triton Capital Investments, Ltd. By: Inter Caribbean Services Limited By: /s/ [Authorized Officer] ------------------------- Name: [Illegible] Title: Secretary PURCHASER NAME: JMG Capital Partners, L.P. By: /s/ Jonathan Glaser ------------------------- Name: Jonathan Glaser Title: General Partner -11- EX-5.1 5 EXHIBIT 5.1 Exhibit 5.1 WILMER, CUTLER & PICKERING 2445 M STREET, N.W. WASHINGTON, D.C. 20037-1420 Telephone (202) 663-6000 Facsimile (202) 663-6363 January 30, 1998 IGEN International, Inc. 16020 Industrial Drive Gaithersburg, MD 20877 Re: IGEN International, Inc. Registration Statement on Form S-3 Dear Ladies and Gentlemen: We have acted as counsel to IGEN International, Inc., a Delaware corporation (the "Company"), in connection with a Registration Statement (the "Registration Statement") on Form S-3 initially filed with the Securities and Exchange Commission (the "Commission") on January __, 1998 under the Securities Act of 1933, as amended. The Registration Statement registers the resale of the shares of Common Stock of the Company, par value $0.001 per share (the "Shares"), issued in connection with the conversion of and/or payment of dividends on the Company's Series B Convertible Preferred Stock. The Series B Convertible Preferred Stock was issued by the Company on December 19, 1997 pursuant to a Purchase Agreement dated December 16, 1997 by and among the Company and the Purchasers identified therein. For the purposes of this opinion, we have examined and relied upon such documents, records, certificates and other instruments as we have deemed necessary. Based solely upon the foregoing, and upon our examination of such questions of law and statutes as we have considered necessary or appropriate, and subject to the assumptions, qualifications, limitations and exceptions set forth herein, we are of the opinion that (i) the Shares have been lawfully and duly authorized; and (ii) when issued upon conversion of or as a dividend upon the Series B Preferred Stock in accordance with the Certificate of Designation, Powers, Preferences and Rights of the Series B Convertible Preferred Stock dated December 18, 1998, the Shares will be validly issued, fully paid and nonassessable. We are members of the bar of the District of Columbia and do not hold ourselves out as being experts in the law of any other jurisdiction. This opinion is limited to the laws of IGEN International, Inc. January 30, 1998 Page 2 the United States and the General Corporation Law of the State of Delaware. Although we do not hold ourselves out as being experts in the laws of the State of Delaware, we have made an investigation of such laws to the extent necessary to render our opinion. Our opinion is rendered only with respect to the laws and the rules, regulations and orders thereunder that are currently in effect. We assume no obligations to advise you of any changes in the foregoing subsequent to the delivery of this opinion. This opinion has been prepared solely for your use in connection with the filing of the Registration Statement on January 30, 1998, and should not be quoted in whole or in part or otherwise be referred to, nor otherwise be filed with or furnished to any governmental agency or other person or entity, without our express prior written consent. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of our name therein under the caption "Legal Matters." Sincerely, Wilmer, Cutler & Pickering By: /s/ Stephen P. Doyle --------------------------------- Stephen P. Doyle, a partner EX-23.2 6 EXHIBIT 23.2 EXHIBIT 23.2 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in this Registration Statement of IGEN International, Inc. on Form S-3 of our report dated May 9, 1997, appearing in the Annual Report on Form 10-K of IGEN International, Inc. for the year ended March 31, 1997 and to the reference to us under the heading "Experts" in the Prospectus, which is part of this Registration Statement. /s/ Deloitte & Touche LLP - ------------------------- Deloitte & Touche LLP Washington, DC January 30, 1998 -----END PRIVACY-ENHANCED MESSAGE-----