Exhibit
4.7


 


[Execution
Copy]


 


AFFYMETRIX,
INC.


0.75%
Senior Convertible Notes due 2033


REGISTRATION
RIGHTS AGREEMENT


December 15, 2003


 


J.P. Morgan Securities Inc.


UBS Securities LLC 

c/o J.P. Morgan Securities Inc.


277 Park Avenue


New York, New York 10172


 


Ladies and Gentlemen:


 


Affymetrix, Inc., a Delaware corporation (the
“Company”), proposes to issue and sell (such issuance and sale, the “Initial
Placement”) to the Initial Purchasers (as defined below), upon the terms
set forth in a purchase agreement, dated December 10, 2003 (the “Purchase
Agreement”), $100,000,000 aggregate principal amount, plus an option (the “Option”)
to purchase up to an additional $20,000,000 aggregate principal amount, of its
0.75% Senior Convertible Notes due 2033 (the “Securities”). The
Securities will be convertible into shares of Common Stock (as defined herein),
at the conversion price set forth in the Offering Memorandum (as defined
herein), as the same may be adjusted from time to time pursuant to the
Indenture (as defined herein). As an inducement to you to enter into the
Purchase Agreement and in satisfaction of a condition to your obligations
thereunder, the Company agrees with you, (i) for your benefit and (ii) for the
benefit of the Holders (as defined herein) from time to time of the Securities
and the shares of Common Stock issuable upon conversion of the Securities, as
follows:


 


1.                                       Definitions.
Capitalized terms used herein without definition shall have the respective
meanings set forth in the Purchase Agreement. As used in this Agreement, the
following capitalized terms shall have the following meanings:


 


“Affiliate” of any specified person means any other person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified person. For the purposes of this definition,
“control” (including, with correlative meanings, the terms “controlling,”
“controlled by” and “under common control with”), as used with respect to any
person, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of such person
whether through the ownership of voting securities or by agreement or
otherwise.


 


“Business Day” has the meaning set forth in the Indenture.


 


“Closing Date” means December 15, 2003.


 

















 


“Common Stock” means the common stock, par value $0.01 per
share, of the Company, as it exists on the date of this Agreement and any other
shares of capital stock or other securities of the Company into which such
Common Stock may be reclassified or changed, together with any and all other
securities which may from time to time be issuable upon conversion of
Securities.


 


“Company” has the meaning set forth in the preamble hereto.


 


“DTC” has the meaning set forth in the Indenture.


 


“Exchange Act” means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated thereunder.


 


“Holder” means a person who is a holder or beneficial owner of
any Securities or shares of Common Stock issuable upon conversion of
Securities; provided that, unless otherwise expressly stated herein, only
registered holders of Securities or Common Stock issued on conversion thereof
shall be counted for purposes of calculating any proportion of holders entitled
to take any action or give notice pursuant to this Agreement.


 


“Holder Information” with respect to any Holder means
information with respect to such Holder required to be included in any Shelf
Registration Statement or the related Prospectus pursuant to the Securities Act
and which information is included therein in reliance upon and in conformity
with information furnished to the Company in writing by such Holder for
inclusion therein.


 


“Indenture” means the Indenture relating to the Securities,
dated December 15, 2003, between the Company and The Bank of New York, as
trustee, as the same may be amended from time to time in accordance with the
terms thereof.


 


“Initial Placement” has the meaning set forth in the preamble
hereto.


 


“Initial Purchasers” means J.P. Morgan Securities Inc. and UBS
Securities LLC.


 


“Liquidated Damages” has the meaning set forth in
Section 2(e) hereof.


 


“Liquidated Damages Payment Date” means each June 15 and
December 15.


 


“Losses” has the meaning set forth in Section 5(d) hereof.


 


“Majority Holders” means the Holders of a majority of the then
outstanding aggregate principal amount of Securities being registered under a
Shelf Registration Statement; provided that Holders of the shares of Common
Stock issued upon conversion of Securities shall be deemed to be Holders of the
aggregate principal amount of Securities from which such Common Stock was
converted; and provided further, that Securities or shares of Common Stock
which have been sold or otherwise transferred pursuant to the Shelf Registration
Statement shall not be included in the calculation of Majority Holders.


 


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“NASD” means the National Association of Securities Dealers,
Inc.


 


“Notice and Questionnaire” means a Selling Securityholder Notice
and Questionnaire substantially in the form of Annex A to the Offering
Memorandum.


 


“Notice Holder” means any Holder of Transfer Restricted
Securities that has delivered a properly completed and signed Notice and
Questionnaire to the Company in accordance with Section 2(b) hereof.


 


“Offering Memorandum” means the Final Memorandum as defined in
the Purchase Agreement.


 


“Option” has the meaning set forth in the preamble hereto.


 


“Person” has the meaning set forth in the Indenture.


 


“Prospectus” means the prospectus included in any Shelf
Registration Statement (including, without limitation, a prospectus that
discloses information previously omitted from a prospectus filed as part of an
effective registration statement in reliance upon Rule 430A under the
Securities Act), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Securities or shares
of Common Stock issuable upon conversion thereof covered by such Shelf
Registration Statement, and all amendments and supplements to such prospectus,
including all documents incorporated or deemed to be incorporated by reference
in such prospectus.


 


“Purchase Agreement” has the meaning set forth in the preamble
hereto.


 


“Questionnaire Deadline” has the meaning set forth in
Section 2(b) hereof.


 


“Record Holder” means each person who is registered on the books
of the registrar as the holder of Securities at the close of business on
June 1 and December 1 immediately preceding such Liquidated Damages
Payment Date.


 


“Registration Default” has the meaning set forth in
Section 2(e) hereof.


 


“Representative” means J.P. Morgan Securities Inc., as
representative of the Initial Purchasers.


 


“Rule 144” means Rule 144 under the Securities Act (or any
similar provision then in force).


 


“Rule 144A” means Rule 144A under the Securities Act (or any
successor provision promulgated by the SEC).


 


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“Rule 144(k)” means Rule 144(k) under the Securities Act (or any
successor provision promulgated by the SEC).


 


“Rule 415” means Rule 415 under the Securities Act (or any
successor provision promulgated by the SEC).


 


“SEC” means the Securities and Exchange Commission.


 


“Securities” has the meaning set forth in the preamble hereto.


 


“Securities Act” means the Securities Act of 1933, as amended,
and the rules and regulations of the SEC promulgated thereunder.


 


“Shelf Registration” means a registration effected pursuant to
Section 2 hereof.


 


“Shelf Registration Period” has the meaning set forth in
Section 2(c) hereof.


 


“Shelf Registration Statement” means any “shelf” registration
statement of the Company filed pursuant to the provisions of Section 2
hereof which covers the Transfer Restricted Securities on Form S-3 or on
another appropriate form (as determined by the Company) for an offering to be
made on a delayed or continuous basis pursuant to Rule 415 and all amendments
and supplements to such registration statement, including post-effective
amendments, in each case including the Prospectus contained therein, all
exhibits thereto and all documents incorporated or deemed to be incorporated by
reference therein.


 


“Suspension Period” has the meaning set forth in
Section 2(d) hereof.


 


“Transfer Restricted Securities” means each Security and each
share of Common Stock issuable upon conversion thereof (and any security issued
with respect thereto upon any stock dividend, split or similar event) until the
earliest of the date on which such Security or share of Common Stock, or any security
issued with respect thereto upon any stock dividend, split or similar event, as
the case may be: (i) has been transferred pursuant to a Shelf Registration
Statement or another registration statement covering such Security or share of
Common Stock which has been filed with the SEC pursuant to the Securities Act,
in either case after such registration statement has become effective and while
such registration statement is effective under the Securities Act; (ii) has
been transferred pursuant to Rule 144 (or any similar provision then in force);
(iii) may be sold or transferred pursuant to Rule 144(k) (or any successor
provision promulgated by the SEC); or (iv) ceases to be outstanding.


 


“Trustee” means the trustee with respect to the Securities under
the Indenture.



All references in this Agreement to
financial statements and schedules and other information which is “contained,”
“included,” or “stated” in the Shelf Registration Statement, any
preliminary Prospectus or Prospectus (and all other references of like import)
shall be deemed to mean and include all such financial statements and schedules


 


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and other information incorporated or deemed to be incorporated by
reference in such Shelf Registration Statement, preliminary Prospectus or
Prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Shelf Registration Statement, any preliminary
Prospectus or Prospectus shall be deemed to mean and include any document filed
with the SEC under the Exchange Act, after the date of such Shelf Registration
Statement, preliminary Prospectus or Prospectus, as the case may be, which is
incorporated or deemed to be incorporated by reference therein.


 


2.                                       Shelf
Registration Statement.


 


(a)                                  The Company shall, at
its expense, prepare and file with the SEC within 90 days following the Closing
Date a Shelf Registration Statement with respect to resales of the Transfer
Restricted Securities by the Holders from time to time on a delayed or
continuous basis pursuant to Rule 415 and in accordance with the methods of
distribution set forth in such Shelf Registration Statement and thereafter
shall use its reasonable best efforts to cause such Shelf Registration
Statement to be declared effective under the Securities Act within 180 days
after the Closing Date; provided
that if any Securities are issued upon exercise of the Option granted to the
Initial Purchasers in the Purchase Agreement and the date on which such
Securities are issued occurs after the Closing Date, the Company will take such
steps, prior to the effective date of the Shelf Registration Statement, to
ensure that such Securities issued upon an exercise of the Option and the
shares of Common Stock issuable upon conversion thereof are included in the
Shelf Registration Statement on the same terms as the Securities issued on the
Closing Date. The Company shall supplement or amend the Shelf Registration
Statement if required by the rules, regulations or instructions applicable to the
registration form used by the Company for the Shelf Registration Statement, or
by the Securities Act, the Exchange Act or the SEC.


 


(b)                                 (i)  The
Company shall name each Holder that delivers a properly completed and signed
Notice and Questionnaire to the Company as a selling security holder in the
Shelf Registration Statement.  A Holder
of Transfer Restricted Securities may include such securities in the Shelf
Registration Statement only if the Holder sends by first-class registered mail
or by courier with delivery confirmation, a properly completed Notice and
Questionnaire to the Company.  In order
to be included in the Shelf Registration Statement at the time of its
effectiveness, the Notice and Questionnaire must be sent on or prior to the
20th Business Day after the date the Notice and Questionnaire is deemed to have
been given in accordance with Section 7(c) hereof (or, in the case of a
Holder that is a transferee of Registrable Securities, on or prior to the
earlier of (x) the 20th Business Day after the completion of the transfer
of Registrable Securities to the transferee and (y) 9:00 a.m., San
Francisco time, on the fifth Business Day prior to initial effectiveness of the
Shelf Registration Statement) (in any case, the “Questionnaire Deadline”).  The
Company agrees and undertakes that it shall distribute a Notice and
Questionnaire (A) no later than 30 Business Days prior to the expected
effectiveness of the Shelf Registration Statement to each Holder in accordance
with Section 7(c) hereof, and (B) in the case of a Holder that is a
transferee of Registrable Securities, upon the


 


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request of such transferee Holder given in
accordance with Section 7(c) hereof, to such Holder at the address set
forth in such request.


 


(ii)  Following the effectiveness of the Shelf
Registration Statement, upon receipt of a completed Notice and Questionnaire
from a Holder, the Company will, as promptly as practicable but in any event
within ten Business Days after receipt thereof, file any amendments to the
Shelf Registration Statement or supplements to the related Prospectus as are
necessary to permit the Holder to deliver the Prospectus to purchasers of
Registrable Securities (subject to the right of the Company to suspend the use
of the Prospectus as described in Section 2(d) hereof).  The Company shall use its reasonable best efforts to
cause any such post-effective amendment to become effective under the
Securities Act as promptly as is practicable; provided,
that if a Notice and Questionnaire is delivered to the Company during a
Suspension Period, the Company shall not be obligated to amend the Shelf
Registration Statement or supplement the Prospectus until the termination of
such Suspension Period.


 


(iii)  Each Holder as to which
the Shelf Registration Statement is being effected agrees to furnish promptly
to the Company (x) such other information as the Company may reasonably
request for use in connection with the Shelf Registration Statement or
Prospectus or in any application to be filed with or under state securities
laws and (y) all information required to be disclosed in order to make the
information previously furnished to the Company by such Holder not misleading.


 


(c)                                  The Company shall use
its reasonable best efforts to keep the Shelf Registration Statement
continuously effective, supplemented and amended under the Securities Act in
order to permit the Prospectus forming a part thereof to be usable, subject to
Section 2(d) hereof, by all Notice Holders until the earliest to occur of:
(i) the last date on which in the opinion of counsel to the Company the holding
period applicable to sales of all Transfer Restricted Securities under Rule
144(k) has expired; (ii) the date as of which all Transfer Restricted Securities
have been transferred under Rule 144; and (iii) such date as of which all
Transfer Restricted Securities have been sold pursuant to the Shelf
Registration Statement (in any such case, such period being called the “Shelf
Registration Period”). The Company will: (x) subject to Section 2(d),
prepare and file with the SEC such amendments and post-effective amendments to
the Shelf Registration Statement as may be necessary to keep the Shelf
Registration Statement continuously effective for the Shelf Registration
Period; (y) subject to Section 2(d), cause the related Prospectus to be
supplemented by any required supplement, and as so supplemented to be filed
pursuant to Rule 424 (or any similar provisions then in force) under the
Securities Act; and (z) comply in all material respects with the provisions of
the Securities Act with respect to the disposition of all Transfer Restricted
Securities covered by the Shelf Registration Statement during the Shelf
Registration Period.


 


(d)                                 The Company may
suspend the availability of any Shelf Registration Statement and the use of any
Prospectus (the period during which the availability of any Shelf Registration
Statement and any Prospectus may be suspended herein referred to as the “Suspension
Period”), without incurring any obligation to pay Liquidated Damages
pursuant to Section 2(e), for a period not to exceed: (i) 45 consecutive
days at any one


 


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time; (ii) 45 days in the aggregate in any three-month period; or (iii)
120 days in the aggregate during any 12-month period, in each case only for
valid business reasons, to be determined in good faith by the Company in its
sole judgment (which shall not include the avoidance of the Company’s
obligations hereunder), including, without limitation, the acquisition or
divestiture of assets, pending corporate developments, public filings with the
SEC and similar events; provided that
if the suspension of the Shelf Registration Statement relates to a previously
undisclosed proposed or pending material business transaction, the disclosure
of which, in the sole judgment of the Company, would impede the Company’s
ability to consummate such transaction, the Company may extend the Suspension
Period set forth in (i) and (ii) above to 75 days; provided  further,
that the Company promptly thereafter complies with the requirements of
Section 3(j) hereof, if applicable.


 


(e)                                  The Company and the
Initial Purchasers agree that the Holders of Transfer Restricted Securities
will suffer damages, and it would not be feasible to ascertain the extent of
such damages with precision, if the Company fails to fulfill its obligations
under Section 2 hereof. Accordingly, if: (i) the Shelf Registration
Statement is not filed with the SEC on or within 90 days after the Closing
Date; (ii) the Shelf Registration Statement has not been declared effective by
the SEC within 180 days after the Closing Date; or (iii) the Shelf Registration
Statement is filed and declared effective but shall thereafter cease to be
effective (without being succeeded immediately by a replacement Shelf
Registration Statement filed and declared effective) or usable (including as a
result of a Suspension Period) for the offer and sale of Transfer Restricted
Securities for a period of time (including any Suspension Period) which
exceeds: (x) 45 consecutive days at any time; (y) 45 days in the aggregate in
any three-month period; or (z) 120 days in the aggregate in any 12-month period
(each such event referred to in clauses (i) through (iii), a “Registration
Default”), provided that, any
suspension of the Shelf Registration Statement as a result of the time required
by the SEC to declare effective a post-effective amendment to the Shelf
Registration Statement in connection with the Company’s obligation to file such
an amendment pursuant to Section 2(d)(ii) hereof shall not be included in
the calculation of a Registration Default; the Company shall pay to each Notice
Holder (who is also a Record Holder) during any period in which a Registration
Default has occurred or is continuing in an amount (the “Liquidated Damages”)
equal to: (i) one-quarter of one percent (25 basis points) per annum per $1,000
principal amount of Securities constituting Transfer Restricted Securities for
the period up to and including the 90th day during which such Registration
Default has occurred and is continuing; and (ii) one-half of one percent (50
basis points) per annum per $1,000 principal amount of Securities constituting
Transfer Restricted Securities for the period including and subsequent to the
91st day during which such Registration Default has occurred and is continuing,
it being understood that all calculations pursuant to this and the preceding
sentence shall be carried out to five decimal places. Following the cure of all
Registration Defaults, Liquidated Damages will cease to accrue with respect to
such Registration Defaults. All accrued Liquidated Damages shall be paid by the
Company on each Liquidated Damages Payment Date in cash to the date of such
cure and Liquidated Damages will be calculated on the basis of a 360-day year
consisting of twelve 30-day months. The parties hereto agree that the
Liquidated Damages provided 


 


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for in this Section 2(e) constitute a reasonable estimate of the
damages that may be incurred by Holders by reason of a Registration Default and
that such Liquidated Damages are the only monetary damages available to Holders
in the event of a Registration Default. 
Nothwithstanding anything in the Agreement to the contrary, Liquidated
Damages shall only be payable to Notice Holders.


 


(f)                                    All of the
Company’s obligations (including, without limitation, the obligation to pay
Liquidated Damages) set forth in the preceding paragraph which are outstanding
or exist with respect to any Transfer Restricted Security at the time such
security ceases to be a Transfer Restricted Security shall survive until such
time as all such obligations with respect to such security shall have been
satisfied in full. Notwithstanding the foregoing, no Liquidated Damages shall
accrue as to any Transfer Restricted Security from and after the earlier of:
(i) the date such security is no longer a Transfer Restricted Security; and
(ii) the expiration of the Shelf Registration Period.


 


(g)                                 Immediately upon the
occurrence or the termination of a Registration Default, the Company shall give
the Trustee, so long as the Securities remain outstanding, notice of such
commencement or termination of the obligation to pay Liquidated Damages with
regard to the Securities, and the amount thereof and of the nature of the
default giving rise to such commencement or the event giving rise to such
termination, as the case may be (such notice to be contained in an Officer’s
Certificate (as such term is defined in the Indenture)), and prior to receipt
of such Officer’s Certificate the Trustee and the transfer and paying agent
shall be entitled to assume that no such commencement or termination has
occurred, as the case may be.


 


3.                                       Registration
Procedures. In connection with any Shelf Registration Statement, the
following provisions shall apply:


 


(a)                                  The Company shall:
(i) furnish to the Initial Purchasers, within a reasonable period of time, but
in any event within three Business Days, prior to the filing thereof with the
SEC to afford the Initial Purchasers and their counsel a reasonable opportunity
for review, a copy of each Shelf Registration Statement, and each amendment
thereof, and a copy of each Prospectus, and each amendment or supplement thereto
(excluding amendments caused by the filing of a report under the Exchange Act),
and shall reflect in each such document, when so filed with the SEC, such
comments as the Initial Purchasers may reasonably propose, except to the extent
the Company reasonably determines it to be inadvisable or inappropriate to
reflect such comments therein; and (ii) include information regarding the
Notice Holders and the methods of distribution they have elected for their
Transfer Restricted Securities provided to the Company in Notice and
Questionnaires as necessary to permit such distribution by the methods
specified therein.


 


(b)                                 Subject to
Section 2(d), the Company shall ensure that: (i) any Shelf Registration
Statement and any amendment thereto and any Prospectus forming a part thereof
and any amendment or supplement thereto comply in all material respects with
the Securities Act and the rules and regulations thereunder; (ii) any Shelf
Registration


 


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Statement and any amendment thereto does not, when it becomes
effective, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading; and (iii) any Prospectus forming a part of any Shelf
Registration Statement, and any amendment or supplement to such Prospectus,
does not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading; provided that the Company makes no
representation with respect to any Holder Information.


 


(c)                                  The Company, as
promptly as reasonably practicable (but in any event within two Business Days),
shall notify the Initial Purchasers and each Notice Holder:


 


(i) when any
Prospectus or any supplement thereto has been filed with the SEC and when the
Shelf Registration Statement or any post-effective amendment thereto has become
effective;


 


(ii) of the
issuance by the SEC or any other federal or state governmental authority of any
stop order suspending the effectiveness of the Shelf Registration Statement or
of any order preventing or suspending the use of any Prospectus or the
initiation or threat of any proceedings for that purpose;


 


(iii) of the
receipt by the Company of any notification with respect to the suspension of
the qualification or exemption from qualification of the Transfer Restricted
Securities included in any Shelf Registration Statement for sale in any
jurisdiction or the initiation or threat of any proceeding for that purpose;


 


(iv) of the
occurrence of, but not the nature of or details concerning, any event or the
existence of any condition that requires the making of any changes in the Shelf
Registration Statement or the Prospectus or any document incorporated by
reference therein so that, as of such date, the statements therein are not
misleading and the Shelf Registration Statement or the Prospectus or any
document incorporated by reference therein, as the case may be, does not
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein (in
the case of the Prospectus, in light of the circumstances under which they were
made) not misleading;


 


(v) of the
Company’s determination that a post-effective amendment to the Shelf
Registration Statement is necessary; and


 


(vi) of the
commencement (including as a result of any of the events or circumstances
described in paragraph (ii) above) and termination of any Suspension Period.


 


(d)                                 The Company shall use
its reasonable best efforts to obtain: (i) the withdrawal of any order
suspending the effectiveness of any Shelf Registration Statement


 


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and the use of any related Prospectus; and (ii) the lifting of any
suspension of the qualification (or exemption from qualification) of any of the
Transfer Restricted Securities for offer or sale in any jurisdiction in which
they have been qualified for sale, in each case at the earliest possible time,
and shall provide notice to each Notice Holder and the Initial Purchasers of
the withdrawal of any such orders or suspensions.


 


(e)                                  The Company shall
promptly furnish to the Initial Purchasers (and, upon written request from any
Notice Holder to such Notice Holder), without charge, at least one copy of any
Shelf Registration Statement and any post-effective amendment thereto,
excluding all documents incorporated or deemed to be incorporated therein by
reference and all exhibits thereto.


 


(f)                                    The Company shall,
during the Shelf Registration Period, promptly deliver to the Initial
Purchasers and each Notice Holder, without charge, as many copies of the
Prospectus (including each preliminary Prospectus) included in any Shelf
Registration Statement, and any amendment or supplement thereto, as such person
may reasonably request and except as provided in Sections 2(d) and 3(p) hereof;
and the Company hereby consents to the use of the Prospectus and any amendment
or supplement thereto by each of the selling Holders in connection with the
offering and sale of the Transfer Restricted Securities covered by the
Prospectus or any amendment or supplement thereto.


 


(g)                                 Prior to any offering
of Transfer Restricted Securities pursuant to any Shelf Registration Statement,
the Company shall register or qualify or cooperate with the Notice Holders and
their respective counsel in connection with the registration or qualification
(or exemption from such registration or qualification) of such Transfer
Restricted Securities for offer and sale, under the securities or blue sky laws
of such jurisdictions within the United States as any such Notice Holders
reasonably request and shall maintain such qualification in effect so long as
required and do any and all other acts or things necessary or advisable to
enable the offer and sale in such jurisdictions of the Transfer Restricted
Securities covered by such Shelf Registration Statement; provided, however, that the Company will
not be required to: (i) qualify generally to do business as a foreign
corporation or as a dealer in securities in any jurisdiction where it is not
then so qualified or; (ii) take any action which would subject it to service of
process or taxation in excess of a nominal dollar amount in any such
jurisdiction where it is not then so subject.


 


(h)                                 If the Transfer
Restricted Securities are in certificated form, the Company shall cooperate
with the Holders to facilitate the timely preparation and delivery of
certificates representing Transfer Restricted Securities sold pursuant to any
Shelf Registration Statement free of any restrictive legends and, with respect
of any Securities, in such denominations permitted by the Indenture and
registered in such names as Holders may request at least two Business Days
prior to settlement of sales of Transfer Restricted Securities pursuant to such
Shelf Registration Statement.


 


(i)                                     Subject to the
exceptions contained in (i) and (ii) of 
Section 3(g) above, the Company shall use its reasonable best
efforts to cause the Transfer Restricted


 


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Securities covered by the applicable Shelf Registration Statement to be
registered with or approved by such other federal, state and local governmental
agencies or authorities, and self-regulatory organizations in the United States
as may be necessary to enable the Holders to consummate the disposition of such
Transfer Restricted Securities as contemplated by the Shelf Registration
Statement; without limitation to the foregoing, the Company shall provide all
such information as may be required by the NASD in connection with the offering
under the Shelf Registration Statement of the Transfer Restricted Securities
(including, without limitation, such as may be required by NASD Rule 2710 or
2720), and shall cooperate with each Holder in connection with any filings
required to be made with the NASD by such Holder in that regard.


 


(j)                                     Upon the
occurrence of any event described in Section 3(c)(iv) or 3(c)(v) hereof,
the Company shall promptly prepare and file with the SEC a post-effective
amendment to any Shelf Registration Statement, or an amendment or supplement to
the related Prospectus, or any document incorporated therein by reference, or
file a document which is incorporated or deemed to be incorporated by reference
in such Shelf Registration Statement or Prospectus, as the case may be, so
that, as thereafter delivered to purchasers of the Transfer Restricted
Securities included therein, the Shelf Registration Statement and the
Prospectus, in each case as then amended or supplemented, will not include an
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements therein (in
the case of the Prospectus, in light of the circumstances under which they were
made) not misleading and, in the case of a post-effective amendment, use its
reasonable best efforts to cause it to become effective as promptly as practicable;
provided that the Company’s
obligations under this paragraph (j) shall be suspended if the Company has
suspended the use of the Prospectus in accordance with Section 2(d) hereof
and given notice of such suspension to Notice Holders, it being understood that
the Company’s obligations under this Section 3(j) shall be automatically
reinstated at the end of such Suspension Period.


 


(k)                                  The Company shall
provide, prior to the effective date of any Shelf Registration Statement
hereunder a CUSIP number for the Transfer Restricted Securities registered
under such Shelf Registration Statement.


 


(l)                                     The Company shall
use its reasonable best efforts to comply with all applicable rules and
regulations of the SEC and shall make generally available to its security
holders an earnings statement satisfying the provisions of Section 11(a)
of the Securities Act and Rule 158 promulgated by the SEC thereunder (or any
similar rule promulgated under the Securities Act) for a 12-month period
commencing on the first day of the first fiscal quarter of the Company
commencing after the effective date of any Shelf Registration Statement or each
post-effective amendment to any Shelf Registration Statement, which such
statements shall be made available no later than 45 days after the end of the
12-month period or 90 days after the end of the 12-month period, if the
12-month period coincides with the fiscal year of the Company.


 


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(m)                               The Company shall use
its reasonable best efforts to cause the Indenture to be qualified under the
TIA (as defined in the Indenture) not later than the effective date of the
first Shelf Registration Statement.


 


(n)                                 The Company shall
cause all shares of Common Stock issuable upon conversion of the Securities to
be reserved for listing on each securities exchange or quotation system on
which the Common Stock is then listed no later than the date the applicable
Shelf Registration Statement is declared effective and, shall cause all Common
Stock to be so listed when issued, and, in connection therewith, to make such
filings as may be required under the Exchange Act and to have such filings
declared effective as and when required thereunder.


 


 (o)                              If
reasonably requested in writing in connection with any disposition of Transfer
Restricted Securities pursuant to a Shelf Registration Statement, make
reasonably available for inspection during normal business hours by a
representative for the Notice Holders of such Transfer Restricted Securities
and any broker-dealers, attorneys and accountants retained by such Notice
Holders, all relevant financial and other records, pertinent corporate
documents and properties of the Company and its subsidiaries, and cause the
appropriate executive officers, directors and designated employees of the
Company and its subsidiaries to make reasonably available for inspection during
normal business hours all relevant information reasonably requested by such
representative for the Notice Holders or any such broker-dealers, attorneys or
accountants in connection with such disposition, in each case as is customary
for similar “due diligence” examinations; provided,
however, that any information that is designated by the Company, in
good faith, as confidential at the time of delivery of such information shall
be kept confidential by such persons, unless disclosure thereof is made in
connection with a court, administrative or regulatory proceeding or required by
law, or such information has become available to the public generally through the
Company or through a third party without an accompanying obligation of
confidentiality.


 


(p)                                 Each Notice Holder
agrees that, upon receipt of notice of the happening of an event described in
Sections 3(c)(ii) through and including 3(c)(vi), it shall forthwith
discontinue (and shall cause its agents and representatives to discontinue)
disposition of Transfer Restricted Securities and will not resume disposition
of Transfer Restricted Securities until such Holder has received copies of an
amended or supplemented Prospectus contemplated by Section 3(j) hereof, or
until such Notice Holder is advised in writing by the Company that the use of
the Prospectus may be resumed or that the relevant Suspension Period has been
terminated, as the case may be, provided that the foregoing shall not prevent
the sale, transfer or other disposition of Transfer Restricted Securities by a
Holder in a transaction which is exempt from, or not subject to, the
registration requirements of the Securities Act, so long as such Holder does
not and is not required to deliver the applicable Prospectus or Shelf
Registration Statement in connection with such sale, transfer or other
disposition, as the case may be; and provided,
further, that the provisions of this Section 3(p) shall not
prevent the occurrence of a Registration Default or otherwise limit the
obligation of the Company to pay Liquidated Damages.


 


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(q)                                 The Company shall use
its reasonable best efforts to take all other steps necessary to effect the
registration of the Securities covered by the Shelf Registration Statement
contemplated hereby.


 


4.                                       Registration
Expenses. The Company shall bear all fees and expenses incurred in
connection with the performance of its obligations under Sections 2 and 3
hereof and shall reimburse the Holders for the reasonable fees and
disbursements of one firm or counsel designated by the Company (and reasonably
acceptable to the Representative on behalf of the Holders) to act as counsel
for the Holders in connection therewith. Such fees and expenses shall include,
without limitation: (i) all registration and filing fees and expenses
(including filings made with the NASD); (ii) all fees and expenses of
compliance with federal securities and state Blue Sky or securities laws; (iii)
all expenses of printing (including printing of Prospectuses and certificates
for the Common Stock to be issued upon conversion of the Securities) and the
Company’s expenses for messenger and delivery services and telephone; (iv) all
fees and disbursements of counsel to the Company; (v) all application and
filing fees in connection with listing (or authorizing for quotation) the
Common Stock on a national securities exchange or automated quotation system
pursuant to the requirements hereof; and (vi) all fees and disbursements of
independent certified public accountants of the Company. The Company shall bear
its internal expenses (including, without limitation, all salaries and expenses
of their officers and employees performing legal, accounting or other duties),
the expenses of any annual audit and the fees and expenses of any Person,
including special experts, retained by the Company. Notwithstanding the
provisions of this Section 4, each Holder shall bear the expense of any
broker’s commission, agency fee and underwriter’s discount or commission
(including, without limitation, the expenses related to the engagement of a
“qualified independent underwriter”), if any, relating to the sale or
disposition of such Holder’s Transfer Restricted Securities pursuant to a Shelf
Registration Statement.


 


5.                                       Indemnification
and Contribution.


 


(a)                                  The Company agrees to
indemnify and hold harmless each Holder of Transfer Restricted Securities
covered by any Shelf Registration Statement (including, without limitation,
each Initial Purchaser), its directors, officers, and employees and each
person, if any, who controls any such Holder within the meaning of either the
Securities Act or the Exchange Act (collectively referred to for purposes of
this Section 5 as a “Holder”) against any losses, claims, damages
or liabilities, joint or several, or actions in respect thereof, to which any
of them may become subject, under the Securities Act or otherwise, insofar as
such losses, claims, damages, liabilities or actions arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in the Shelf Registration Statement, or in any Prospectus, or any
amendment thereof or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, and will reimburse each such party for any legal or other
expenses reasonably incurred by such party in connection with investigating or
defending any such action or claim as such expenses are


 


13

















 


incurred; provided, however,
that: (i) the Company shall not be liable in any such case to the extent that
any such loss, claim, damage or liability arises out of or is based upon Holder
Information; and (ii) with respect to any untrue statement or omission of
material fact made in any Shelf Registration Statement, or in any Prospectus,
the indemnity agreement contained in this Section 5(a) shall not inure to
the benefit of the Holder or any person who controls the Holder within the
meaning of either the Securities Act or the Exchange Act from whom the person
asserting any such loss, claim, damage or liability purchased the securities
concerned, to the extent that any such loss, claim, damage or liability of the
Holders occurs under the circumstance where it shall have been established
that: (w) the Company had previously furnished copies of the Prospectus, and
any amendments and supplements thereto, to the Holder; (x) delivery of the
Prospectus, and any amendment or supplements thereto, was required by the
Securities Act to be made to such person; (y) the untrue statement or omission
of a material fact contained in the Prospectus was corrected in amendments or
supplements thereto; and (z) there was not sent or given to such person, at or
prior to the written confirmation of the sale of such securities to such
person, a copy of such amendments or supplements to the Prospectus. This
indemnity agreement will be in addition to any liability that the Company may
otherwise have.


 


(b)                                 Each Holder, severally
and not jointly, agrees to indemnify and hold harmless the Company, each of its
directors and officers and each person, if any, who controls the Company within
the meaning of either the Securities Act or the Exchange Act, to the same
extent as the foregoing indemnity from the Company to the Holders and agrees to
reimburse each such indemnified party, as incurred, for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any loss, claim, damage, liability or action, but only with reference
to Holder Information supplied by such Holder. In no event shall any Holder,
its directors, officers or any person, if any, who controls such Holder be
liable or responsible for any amount in excess of the amount by which the total
amount received by such Holder with respect to its sale of Transfer Restricted
Securities pursuant to a Shelf Registration Statement exceeds: (i) the amount
paid by such Holder for such Transfer Restricted Securities; plus (ii) the
amount of any damages that such Holder, its directors, officers or any person
who controls such Holder has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. This
indemnity agreement will be in addition to any liability that such Holder may
otherwise have.


 


(c)                                  Promptly after
receipt by an indemnified party under this Section 5 of notice of any
claim or the commencement of any action or proceeding (including any
governmental investigation), such indemnified party will, if a claim for
indemnification in respect thereof is to be made against the indemnifying party
under Section 5(a) or 5(b) hereof, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party will not relieve it from any liability which it may have to
any indemnified party to the extent it is not materially prejudiced as a result
thereof and in any event shall not relieve it from any liability which it may
have otherwise than on account of this indemnity agreement. In case any such
action or proceeding is brought against any indemnified party, and it notifies
the indemnifying


 


14

















 


party of the commencement thereof, the indemnifying party will be
entitled to participate therein (jointly with any other indemnifying party similarly
notified), and to the extent that it may elect, by written notice, delivered to
such indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party; provided, however, that if the
defendants (including any impleaded parties) in any such action include both
the indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there may be legal defenses available to
it and/or other indemnified parties which are different from or additional to
those available to the indemnifying party, the indemnified party or parties
shall have the right to select separate counsel to defend such action on behalf
of such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of its election so to appoint
counsel to defend such action and approval by the indemnified party of such
counsel, the indemnifying party will not be liable to such indemnified party
under this Section 5 for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof unless: (i)
the indemnified party shall have employed separate counsel in accordance with
the proviso to the preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expense of more than one
separate counsel (in addition to any local counsel), approved by the Holders in
the case of paragraph (a) of this Section 5, representing the indemnified
parties under such paragraph (a) who are parties to such action); (ii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after notice or commencement of the action; (iii) the indemnifying party
has authorized the employment of counsel for the indemnified party at the
expense of the indemnifying party; or (iv) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such
counsel with a conflict of interest. An indemnifying party will not, without
the prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified parties
are actual or potential parties to such claim or action) unless such
settlement, compromise or consent includes an unconditional release of each
indemnified party from all liability arising out of such claim, action, suit or
proceeding. If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel as contemplated by this Section 5(c), the indemnifying party
agrees that it shall be liable for any settlement of any proceeding effected by
the indemnified party without its consent if: (x) such settlement is entered
into more than 30 days after receipt by such indemnifying party of such request
for reimbursement; and (y) such indemnifying party shall not have reimbursed
the indemnified person in accordance with such request prior to the date of any
settlement.


 


(d)                                 In the event that the
indemnity provided in paragraph (a) or (b) of this Section 5 is
unavailable to or insufficient to hold harmless an indemnified party for any
reason, each indemnifying party agrees to contribute to the aggregate losses,
claims, damages and liabilities (including legal or other expenses reasonably
incurred in connection with investigating or defending same) (collectively, “Losses”)
to which the


 


15

















 


indemnified party may be subject in such proportion as is appropriate
to reflect the relative benefits received by the Company from the Initial
Placement, on the one hand, and a Holder with respect to the sale by such
Holder of Securities or Common Stock, on the other hand; provided, however, that in no case shall
an indemnifying party that is a Holder be responsible for any amount in excess
of the total price at which the Transfer Restricted Securities are sold by such
Holder to a purchaser. If the allocation provided by the immediately preceding
sentence is unavailable for any reason, the Company and such Holder shall
contribute in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one hand
and of such Holder on the other in connection with the statements or omissions
which resulted in such Losses, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and such Holder on the other shall be deemed to be in the same respective
proportions as the total net proceeds from the Initial Placement (before
deducting expenses) received by or on behalf of the Company as set forth in the
Offering Memorandum, on the one hand, and the total proceeds received by such
Holder with respect to its sale of Transfer Restricted Securities under the
Shelf Registration Statement, on the other hand, bear to the total gross
proceeds from the Initial Placement. Relative fault shall be determined by
reference to, among other things, whether any untrue or any alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information provided by the Company on the one hand or
relates to Holder Information supplied by such Holder, on the other, the intent
of the parties and their relative knowledge, information and opportunity to
correct or prevent such untrue statement or omission. The parties agree that it
would not be just and equitable if contribution pursuant to this paragraph (d)
were determined by pro rata allocation or any other method of allocation that
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 was not
guilty of such fraudulent misrepresentation. For purposes of this
Section 5(d), each person who controls such Holder within the meaning of
either the Securities Act or the Exchange Act 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
and director 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 provisions of
this Section 5 will remain in full force and effect, regardless of any
investigation made by or on behalf of any Holder, any underwriter or the
Company or any of the officers, directors or controlling persons referred to in
Section 5 hereof, and will survive the sale by a Holder of Transfer Restricted
Securities covered by a Shelf Registration Statement.


 


6.                                       Rules
144 and 144A. The Company covenants that it shall use its reasonable best
efforts to file the reports required to be filed by it under the Securities Act
and the Exchange Act in a timely manner so long as the Transfer Restricted
Securities remain outstanding. If at any time the Company is not required to
file such reports, it will, upon


 


16

















 


request of any Holder or beneficial owner of Transfer Restricted
Securities, make available such information necessary to permit sales pursuant
to Rule 144A. The Company further covenants that, for as long as any Transfer
Restricted Securities remain outstanding, it will take such further action as
any Holder of Transfer Restricted Securities may reasonably request, all to the
extent required from time to time to enable such Holder to sell Transfer
Restricted Securities without registration under the Securities Act within the
limitation of the exemptions provided by Rule 144 and Rule 144A. Upon the
written request of any Holder of Transfer Restricted Securities, the Company
shall deliver to such Holder a written statement as to whether it has complied
with such requirements.


 


7.                                       Miscellaneous.


 


(a)                                  No Inconsistent
Agreements. The Company has not, as of the date hereof, entered into nor
shall it, on or after the date hereof, enter into, any agreement with respect
to its securities that is inconsistent with the rights granted to the Holders
herein or otherwise conflicts with the provisions hereof. In addition, the
Company shall not grant to any of its securityholders (other than the Holders
of Transfer Restricted Securities in such capacity) the right to include any of
its securities in the Shelf Registration Statement provided for in this
Agreement other than the Transfer Restricted Securities.


 


(b)                                 Amendments and
Waivers. The provisions of this Agreement, including the provisions of this
sentence, may not be amended, qualified, modified or supplemented, and waivers
or consents to departures from the provisions hereof may not be given, unless
the Company has obtained the written consent of at least the majority of the
Holders of the then outstanding Transfer Restricted Securities; provided that
with respect to any matter that directly or indirectly affects the rights of
the Initial Purchasers hereunder, the Company shall obtain the written consent
of the Initial Purchasers against which such amendment, qualification,
supplement, waiver or consent is to be effective. Notwithstanding the foregoing
(except the foregoing proviso), a waiver or consent to departure from the
provisions hereof with respect to a matter that relates exclusively to the
rights of Holders whose Transfer Restricted Securities are being sold pursuant
to a Shelf Registration Statement and that does not directly or indirectly
affect the rights of other Holders may be given by the Majority Holders.


 


(c)                                  Notices. All
notices and other communications provided for or permitted hereunder shall be
made in writing by hand-delivery, first-class mail, telecopier, or air courier
guaranteeing overnight delivery:


 


(i)                                     if to the Initial
Purchasers, initially at their address set forth in the Purchase Agreement;


 


(ii)                                  if to any other
Holder, at the most current address of such Holder maintained by the Registrar
under the Indenture or the registrar of the Common Stock (provided that while
the Securities or the Common Stock are in book-entry form, notice


 


17

















 


to the Trustee shall serve as notice to the Holders), or, in the case
of the Notice Holder, the address set forth in its Notice and Questionnaire;
and


 


(iii)                         if to the
Company, to:


 


Affymetrix, Inc.


3380 Central Expressway


Santa Clara, CA 95051


Facsimile: (408) 481-0422


Attn: General Counsel


 


With a copy to:


 


Davis Polk & Wardwell


1600 El Camino Real


Menlo Park, CA 94025


Facsimile: (650) 752-2111


Attn: Alan F. Denenberg, Esq.


 


All such notices and communications shall be deemed to have been duly
given when received, if delivered by hand or air courier, and when sent, if
sent by first-class mail or telecopier.


 


The Initial Purchasers or the Company by
notice to the other may designate additional or different addresses for
subsequent notices or communications.


 


(d)                                 Successors and
Assigns. This Agreement shall inure to the benefit of and be binding upon
the successors and assigns of each of the parties, including, without the need
for an express assignment or any consent by the Company thereto, subsequent
Holders. The Company hereby agrees to extend the benefits of this Agreement to
any Holder and underwriter and any such Holder and underwriter may specifically
enforce the provisions of this Agreement as if an original party hereto. In the
event that any other person shall succeed to the Company under the Indenture,
then such successor shall enter into an agreement, in form and substance
reasonably satisfactory to the Initial Purchasers, whereby such successor shall
assume all of the Company’s obligations under this Agreement.


 


(e)                                  Counterparts.
This Agreement may be executed in any number of counterparts and by the parties
hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which taken together shall constitute one and the
same agreement.


 


(f)                                    Headings.
The headings in this Agreement are for convenience of reference only and shall
not limit or otherwise affect the meaning hereof.


 


18

















 


(g)                                 Governing Law.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND
TO BE PERFORMED IN SAID STATE.


 


(h)                                 Severability.
In the event that any one of more of the provisions contained herein, or the
application thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions hereof shall not be in any way impaired or affected
thereby, it being intended that all of the rights and privileges of the parties
shall be enforceable to the fullest extent permitted by law.


 


(i)                                     Securities Held
by the Company, Etc. Whenever the consent or approval of Holders of a
specified percentage of principal amount of Securities or the shares of Common
Stock issuable upon conversion thereof is required hereunder, Securities or the
shares of Common Stock issued upon conversion thereof held by the Company or
its Affiliates (other than subsequent Holders of Securities or the Common Stock
issued upon conversion thereof if such subsequent Holders are deemed to be
Affiliates solely by reason of their holdings of such Securities) shall not be
counted in determining whether such consent or approval was given by the
Holders of such required percentage.


 


(j)                                     Termination.
This Agreement and the obligations of the parties hereunder shall terminate
upon the end of the Shelf Registration Period, except for any liabilities or
obligations under Section 2(e), 4 or 5 to the extent arising prior to the
end of the Shelf Registration Period.


 


Please confirm that the foregoing correctly sets forth the agreement
between the Company and you.


 


19

















 


Very truly yours,


 


AFFYMETRIX, INC.


 


	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


20

















 


The foregoing Agreement is hereby confirmed and accepted as of the date
first above written.


 


J.P. MORGAN SECURITIES INC.


 


Acting on behalf of itself and as Representative of the Initial
Purchasers


 


By: J.P. MORGAN SECURITIES INC.


 


	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


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