Exhibit 1.1
EXECUTION COPY
3,336,117 Shares
OXIGENE, INC.
Common Stock
PLACEMENT AGENCY
AGREEMENT
March 3, 2005
Legg Mason Wood Walker, Incorporated
Lazard Freres & Co. LLC
As Placement Agents
c/o Legg Mason Wood Walker,
Incorporated
100 Light Street
Baltimore, MD 21202
Ladies and Gentlemen:
OXiGENE, Inc., a Delaware
corporation (the “Company”), proposes, subject to the
terms and conditions contained herein, to issue and sell shares
(the “Shares”) of common stock, $0.01 par value per
share (the “Common Stock”), directly to certain
investors (collectively, the “Investors”). The Company
desires to engage you as its placement agents (the “Placement
Agents”) in connection with such issuance and sale. The
Shares are more fully described in the Registration Statement (as
hereinafter defined).
The Company has prepared and filed
in conformity with the requirements of the Securities Act of 1933,
as amended (the “Securities Act”), and the published
rules and regulations thereunder (the “Rules”) adopted
by the Securities and Exchange Commission (the
“Commission”), a Registration Statement (as hereinafter
defined) on Form S-3 (No. 333-109433), including a base prospectus
relating to the Shares (the “Base Prospectus”) and such
amendments thereof as may have been required to the date of this
Agreement. Copies of such Registration Statement (including all
amendments thereof) and of the related Base Prospectus (as
hereinafter defined) have heretofore been delivered by the Company
to you. The term “Registration Statement” as used in
this Agreement means the initial registration statement (including
all exhibits, financial schedules and all documents and information
deemed to be a part of the Registration Statement through
incorporation by reference or otherwise)), as amended
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at the time and on the date it became effective
(the “Effective Date”), including the information (if
any) contained in the form of final prospectus filed with the
Commission pursuant to Rule 424(b) of the Rules and deemed to be
part thereof at the time of effectiveness pursuant to Rule 430A of
the Rules. If the Company has filed an abbreviated registration
statement to register additional Shares pursuant to Rule 462(b)
under the Rules (the “462(b) Registration Statement”),
then any reference herein to the Registration Statement shall also
be deemed to include such 462(b) Registration Statement. The
prospectus supplement relating to the Shares as filed with the
Commission pursuant to and in accordance with Rule 424(b) under the
Securities Act is hereinafter referred to as the “Prospectus
Supplement.” The term “Prospectus” as used in
this Agreement means the Base Prospectus together with the
Prospectus Supplement. As used herein, the terms “Base
Prospectus,” “Prospectus,” “Registration
Statement,” “462(b) Registration Statement,” and
“Prospectus Supplement” shall include any documents
incorporated by reference therein, and any reference to any
amendment or supplement to the Registration Statement or the
Prospectus shall be deemed to refer to and include any documents
filed under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), after the date of the Base Prospectus
by the Company with the Commission, that are deemed to be
incorporated by reference in the Prospectus.
The Company hereby confirms that the
Placement Agents, in connection with their duties in such capacity,
are authorized to distribute or cause to be distributed the
Prospectus (as from time to time amended or supplemented if the
Company furnishes amendments or supplements thereto to the
Placement Agents).
1. Agreement to Act as Placement
Agents, Delivery and Payment . On the basis of the
representations, warranties and agreements contained in, and
subject to the terms and conditions of, this Agreement:
(a) The Placement Agents agree to
act as the Company’s exclusive placement agents in connection
with the issuance and sale, on a reasonable efforts basis, by the
Company of the Shares to the Investors. The Company acknowledges
and agrees that the Placement Agents’ engagement hereunder is
not an agreement by the Placement Agents or any of their affiliates
to underwrite or purchase any securities or otherwise provide any
financing. As compensation for their services hereunder, the
Company agrees to pay on the Closing Date (as defined below) to the
Placement Agents by wire transfer of immediately available funds 7%
of the proceeds received by the Company from the sale of the
Shares.
(b) Payment of the purchase price
for, and delivery of the Shares shall be made at a closing (the
“Closing”) at the offices of Skadden, Arps, Slate,
Meagher & Flom LLP, at 9:00 a.m., New York time, on the Closing
Date to take place on the third or fourth business day (as
permitted under Rule 15c6-1 under the Exchange Act) after the
determination of the sales price of the Shares (such time and date
of payment and delivery being herein called the “Closing
Date”). All actions taken at the Closing shall be deemed to
have occurred simultaneously.
(c) Payment of the purchase price
for the Shares shall be made by the Investors directly to or upon
the order of U.S. Bank National Association, as escrow agent
(the
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“Escrow Agent”) by wire
transfer in immediately available funds to the Escrow Agent, upon
delivery of the Shares through the facilities of The Depository
Trust Company, to the Investors, and shall be registered in such
name or names and shall be in such denominations, as the Investors
may request at least one business day before the Closing
Date.
(d) The several purchases of the
Shares by the Investors shall be evidenced by the execution of one
or more purchase agreements each substantially in the form attached
hereto as Exhibit A (the “Purchase
Agreement”).
(e) Prior to the earlier of (i) the
date on which this Agreement is terminated and (ii) the Closing
Date, the Company shall not, without the prior consent of the
Placement Agents, solicit or accept offers to purchase Shares
(other than pursuant to the exercise of options or warrants to
purchase shares of Common Stock that are outstanding at the date
hereof) otherwise than through the Placement Agents.
2. Representations and Warranties
of the Company . The Company represents and warrants to each
Placement Agent as of the date hereof, and as of the Closing Date,
as follows:
(a) The Company meets the
requirements for use of Form S-3 under the Securities Act. On the
Effective Date, the Registration Statement complied, and on the
date of the Prospectus, the date any post-effective amendment to
the Registration Statement becomes effective, the date any
supplement or amendment to the Prospectus is filed with the
Commission and the Closing Date, the Registration Statement and the
Prospectus (and any amendment thereof or supplement thereto) will
comply, in all material respects, with the requirements of the
Securities Act and the Rules and the Exchange Act and the rules and
regulations of the Commission thereunder. The Registration
Statement did not, as of the Effective Date, contain any 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 not misleading; and on the Effective Date and
the other dates referred to in the second sentence of this
paragraph 2(a) above, neither the Registration Statement nor the
Prospectus, nor any amendment thereof or supplement thereto, will
contain any untrue statement of a material fact or will omit to
state any material fact required to be stated therein or necessary
in order to make the statements therein not misleading. If
applicable, when any related preliminary prospectus was first filed
with the Commission (whether filed as part of the Registration
Statement or any amendment thereto or pursuant to Rule 424(b) of
the Rules) and when any amendment thereof or supplement thereto was
first filed with the Commission, such preliminary prospectus as
amended or supplemented complied in all material respects with the
applicable provisions of the Securities Act and the Rules and did
not contain any 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 not misleading. If
applicable, each preliminary prospectus and the Prospectus
delivered to the Placement Agents for use in connection with this
offering was identical to the electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to the
extent permitted by Regulation S-T. If Rule 434 is used, the
Company will comply with the requirements of
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Rule 434 and the Prospectus shall
not be “materially different,” as such term is used in
Rule 434, from the Prospectus included in the Registration
Statement at the time it became effective. Notwithstanding the
foregoing, none of the representations and warranties in this
paragraph 2(a) shall apply to statements in, or omissions from, the
Registration Statement or the Prospectus made in reliance upon, and
in conformity with, information herein or otherwise furnished in
writing by the Placement Agents for use in the Registration
Statement or the Prospectus.
(b) The Registration Statement is
effective under the Securities Act, and no stop order preventing or
suspending the effectiveness of the Registration Statement or
suspending or preventing the use of the Prospectus has been issued
by the Commission and, to the Company’s knowledge, no
proceedings against the Company for that purpose have been
instituted or are threatened under the Securities Act. Any required
filing of the Prospectus and any supplement thereto pursuant to
Rule 424(b) of the Rules has been or will be made in the manner and
within the time period required by such Rule 424(b).
(c) The documents incorporated by
reference in the Registration Statement and the Prospectus, at the
time they became effective or were filed with the Commission, as
the case may be, complied in all material respects with the
requirements of the Securities Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission
thereunder, and at the time they became effective or were filed
with the Commission, as the case may be, none of such documents
contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, and any
further documents so filed and incorporated by reference in the
Registration Statement and the Prospectus, when such documents
become effective or are filed with the Commission, as the case may
be, will conform in all material respects to the requirements of
the Securities Act or the Exchange Act, as applicable, and the
rules and regulations of the Commission thereunder and will not
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, in light of the circumstances under which
they are made, not misleading.
(d) The financial statements of the
Company (including all notes and schedules thereto) included or
incorporated by reference in the Registration Statement and
Prospectus present fairly, in all material respects, the financial
position of the Company at the dates indicated and the statement of
operations, stockholders’ equity and cash flows of the
Company for the periods specified; and such financial statements
and related schedules and notes thereto, and the unaudited
financial information filed with the Commission as part of the
Registration Statement, have been prepared in conformity with
generally accepted accounting principles, consistently applied
throughout the periods involved (except as otherwise stated therein
and subject, in the case of unaudited financial statements, to the
absence of footnotes and normal year-end adjustments). The selected
financial data included in the Prospectus present fairly, in all
material respects, the information shown therein as at the
respective dates and for the respective periods specified and have
been presented on a basis consistent with the consolidated
financial statements set forth in the Prospectus and other
financial information.
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(e) Ernst & Young LLP
(“E&Y”), whose reports are filed with the
Commission as a part of the Registration Statement, are and, during
the periods covered by their reports, were independent public
accountants with respect to the Company as required by the
Securities Act and the Rules.
(f) The Company is duly organized,
validly existing and in good standing under the laws of its
jurisdiction of incorporation. The Company has no subsidiary or
subsidiaries and does not control, directly or indirectly, any
corporation, partnership, joint venture, association or other
business organization. The Company is duly qualified to do business
and is in good standing as a foreign entity in each jurisdiction in
which the nature of the business conducted by it or location of the
assets or properties owned, leased or licensed by it requires such
qualification, except for such jurisdictions where the failure to
so qualify individually or in the aggregate would not have a
material adverse effect on the assets, properties, condition,
financial or otherwise, or the results of operations of the Company
considered as a whole (a “Material Adverse Effect”);
and to the Company’s knowledge, no proceeding has been
instituted in any such jurisdiction revoking, limiting or
curtailing, or seeking to revoke, limit or curtail, such power and
authority or qualification. Except as disclosed in the Prospectus,
the Company does not own, lease or license any material asset or
property or conduct any material business, other than clinical
trials, outside the United States of America
(g) The Company has all requisite
corporate power and authority, and all necessary authorizations,
approvals, consents, orders, licenses, certificates and permits of
and from all governmental or regulatory bodies or any other person
or entity (collectively, the “Permits”), to own, lease
and license its assets and properties and conduct its business, all
of which are valid and in full force and effect, except where the
lack of such Permits, individually or in the aggregate, would not
have a Material Adverse Effect. The Company has fulfilled and
performed in all material respects all of its material obligations
with respect to such Permits and no event has occurred that allows,
or after notice or lapse of time would allow, revocation or
termination thereof, or results in any other impairment of the
rights of the Company thereunder, except where such revocation,
termination or impairment would not have a Material Adverse Effect.
Except as may be required under the Securities Act, state and
foreign Blue Sky laws, and by the rules of the National Association
of Securities Dealers, Inc. (the “NASD”), no other
Permits are required to enter into, deliver and perform this
Agreement and each Purchase Agreement and to issue and sell the
Shares.
(h) Since the respective dates as of
which information is given in the Prospectus, (i) all of the
descriptions of the Company’s legal and governmental
proceedings and procedures before the United States Food and Drug
Administration (the “FDA”), the European Medicines
Evaluation Agency (the “EMEA”) or any other national,
departmental, state or local governmental body exercising
comparable authority are true and correct in all material respects,
(ii) all of the description of the studies, tests and preclinical
and clinical trials conducted by or on behalf of the Company were
and, if still pending, are being conducted in accordance with
experimental protocols, procedures and controls pursuant to, where
applicable, accepted professional scientific standards (which
statements are made to the Company’s knowledge after due
inquiry with respect to all
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such studies, tests and preclinical
and clinical trials that are being conducted on its behalf or
independently by others using the Company’s drug candidates);
(iii) the descriptions of the results of such studies, tests and
trials are true and correct in all material respects (which
statements are made to the Company’s knowledge after due
inquiry with respect to all such studies, tests and preclinical and
clinical trials that are being conducted on its behalf or
independently by others using the Company’s drug candidates);
and (iv) except as disclosed in the Prospectus, the Company has not
received any notices or correspondence from the FDA, or any
national, state or local governmental body exercising comparable
authority requiring the termination, suspension or material
modification of any studies, tests or preclinical or clinical
trials conducted by or on behalf of the Company.
(i) To the best of the
Company’s knowledge, after due inquiry, the Company owns or
possesses adequate rights to use all patents, patent rights,
licenses, inventions, copyrights, know-how (including trade secrets
and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures), trademarks,
service marks, trade names or other intellectual property necessary
to carry on the business now operated by it with respect to the
Company’s currently contemplated combretastatin products for
ophthalmic and oncology uses as described in the Company’s
Form 10-K and the Prospectus Supplement (collectively, “
Intellectual Property ”), except where the lack of
such ownership or rights would not have a Material Adverse Effect.
Except as disclosed in the Prospectus, there is no litigation or
other proceeding pending or, to the Company’s knowledge,
threatened and no claims are presently being asserted by any third
party challenging or questioning the ownership, validity, or
enforceability of the Company’s right to use or own any
Intellectual Property or asserting that the use of any Intellectual
Property by the Company or the operation of the business of the
Company infringes upon or misappropriates the Intellectual Property
of any third party, other than infringements which would not be
reasonably likely to have a Material Adverse Effect, and the
Company is not otherwise aware of any infringement of or conflict
with asserted rights of others with respect to any of the
Company’s Intellectual Property or of any facts or
circumstances which would render any of the Company’s
Intellectual Property invalid or inadequate to protect the interest
of the Company therein, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or
invalidity or inadequacy, singly or in the aggregate, would result
in a Material Adverse Effect.
(j) The Company has good and
marketable title in fee simple to all real property, and good and
marketable title to all other personal property owned by it, in
each case free and clear of all liens, encumbrances, claims,
security interests and defects, except such as do not materially
affect the value of such property and do not materially interfere
with the use made or proposed to be made of such property by the
Company. All property held under lease by the Company is held by it
under valid, existing and enforceable leases, free and clear of all
liens, encumbrances, claims, security interests and defects, except
such as are not material and do not materially interfere with the
use made or proposed to be made of such property by the Company.
Subsequent to the respective dates as of which information is given
in the Registration Statement and the Prospectus, (i) there has not
been any Material Adverse Effect; (ii) the Company has not
sustained any loss or interference with its assets, businesses or
properties (whether owned or leased) from fire,
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explosion, earthquake, flood or
other calamity, whether or not covered by insurance, or from any
labor dispute or any court or legislative or other governmental
action, order or decree, in any such case that would have a
Material Adverse Effect; and (iii) since the date of the latest
balance sheet included or incorporated by reference in the
Registration Statement and the Prospectus, the Company has not (A)
issued any securities except for shares of Common Stock of the
Company issued upon the exercise or conversion of securities
exercisable for, or convertible into, shares of Common Stock
outstanding on the date of such balance sheet or incurred any
liability or obligation, direct or contingent, for borrowed money,
except such liabilities or obligations incurred in the ordinary
course of business, (B) entered into any transaction not in the
ordinary course of business or (C) declared or paid any dividend or
made any distribution on any shares of its stock or redeemed,
purchased or otherwise acquired or agreed to redeem, purchase or
otherwise acquire any shares of its capital stock.
(k) There is no document, contract
or other agreement required to be described in the Registration
Statement or Prospectus or to be filed as an exhibit to the
Registration Statement which is not described or filed as required
by the Securities Act or Rules. Each description of a contract,
document or other agreement in the Registration Statement and the
Prospectus accurately reflects in all material respects the terms
of the underlying contract, document or other agreement. Each
contract, document or other agreement described in the Registration
Statement and Prospectus or listed in the exhibits to the
Registration Statement or incorporated by reference is in full
force and effect and is valid and enforceable by and against the
Company in accordance with its terms. Neither the Company nor, to
the Company’s knowledge, any other party is in default in the
observance or performance of any term or obligation to be performed
by it under any such agreement or any other agreement or instrument
to which the Company is a party or by which Company or its
properties or business may be bound, and no event has occurred
which with notice or lapse of time or both would constitute such a
default, in any such case in which the default or event,
individually or in the aggregate, would have a Material Adverse
Effect.
(l) The statistical and market
related data included in the Prospectus are based on or derived
from sources that the Company believes to be reliable and
accurate.
(m) The Company is not in violation
of any term or provision of its charter, by-laws or of any
franchise, license, permit, judgment, decree, order, statute, rule
or regulation, where the consequences of such violation,
individually or in the aggregate, would have a Material Adverse
Effect.
(n) This Agreement and each Purchase
Agreement has been duly authorized, executed and delivered by the
Company.
(o) Neither the execution, delivery
and performance of this Agreement by the Company nor the
consummation of any of the transactions contemplated hereby
(including, without limitation, the issuance and sale by the
Company of the Shares) will (a) give rise to a right to terminate
or accelerate the due date of any payment due under, or conflict
with or result in the breach of any term or provision of, or
constitute a default
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(or an event which with notice or
lapse of time or both would constitute a default) under, or require
any consent or waiver under, or result in the execution or
imposition of any lien, charge or encumbrance upon any properties
or assets of the Company pursuant to the terms of, (i) any
indenture, mortgage, deed of trust or other agreement or instrument
to which the Company is a party or by which the Company or any of
its properties or businesses is bound, or (ii) any franchise,
license, permit, judgment, decree, order, statute, rule or
regulation applicable to the Company, or (b) violate any provision
of the charter or by-laws of the Company except for such consents
or waivers which have already been obtained and are in full force
and effect, and except in the case of clause (a) above, for any
such right, conflict, breach, default or other consequence that
would not, individually or in the aggregate, have a Material
Adverse Effect.
(p) The Company is authorized to
issue a total of 60,000,000 shares of capital stock consisting of
60,000,000 shares of Common Stock. After giving effect to the
transactions contemplated by the Purchase Agreement, on the date
hereof, (i) no shares of Preferred Stock will be issued and
outstanding, (ii) 20,049,854 shares of Common Stock will be issued
and outstanding, (iii) 2,500,000 shares of common stock will be
reserved for issuance under the Company’s stock option plans,
of which 1,593,750 shares were subject to outstanding options as of
March 1, 2005, and (iv) 525,000 warrants will be outstanding. The
certificates evidencing the Shares are in due and proper legal form
and have been duly authorized for issuance by the Company. All of
the issued and outstanding shares of Common Stock have been duly
and validly issued and are fully paid and nonassessable. There are
no statutory preemptive or other similar rights to subscribe for or
to purchase or acquire any shares of Common Stock of the Company or
any such rights pursuant to its Certificate of Incorporation or
by-laws or any agreement or instrument to or by which the Company
is a party or bound. The Shares, when delivered by the Company
pursuant to this Agreement and the Purchase Agreements, will be
duly and validly issued, fully paid and nonassessable and none of
them will be issued in violation of any preemptive or other similar
right. Except as disclosed in the Registration Statement and the
Prospectus, there is no outstanding option, warrant or other right
calling for the issuance of, and there is no commitment, plan or
arrangement to issue, any share of stock of the Company or any
security convertible into, or exercisable or exchangeable for, such
stock. The Common Stock and the Shares conform in all material
respects to all descriptions thereof contained in the Registration
Statement and the Prospectus.
(q) No holder of any security of the
Company has any right, which has not been waived, to have any
security owned by such holder included in the Registration
Statement or to demand registration of any security owned by such
holder for a period of 180 days after the date of this Agreement.
Each director and executive officer of the Company listed on
Schedule I hereto has delivered to the Placement Agents his
enforceable written lock-up agreement in the form attached to this
Agreement as Exhibit B hereto (“Lock-Up
Agreement”).
(r) All necessary corporate action
has been duly and validly taken by the Company to authorize the
execution, delivery and performance of this Agreement and each
Purchase Agreement and the issuance and sale of the Shares by the
Company. This
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Agreement and each Purchase
Agreement has been duly and validly authorized, executed and
delivered by the Company and constitute and will constitute legal,
valid and binding obligations of the Company enforceable against
the Company in accordance with their respective terms, except as
rights to indemnity and contribution thereunder may be limited by
federal or state securities laws and matters of public policy and
except as the enforceability thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors’ rights generally and
by general equitable principles.
(s) The Company is not involved in
any labor dispute nor, to the knowledge of the Company, is any such
dispute threatened, which dispute would have a Material Adverse
Effect. The Company is not aware of any existing or imminent labor
disturbance by the employees of any of its principal suppliers or
contractors which would have a Material Adverse Effect. The Company
is not aware of any threatened or pending litigation between the
Company and any of its executive officers which, if adversely
determined, could have a Material Adverse Effect and has no reason
to believe that such officers will not remain in the employment of
the Company.
(t) No transaction has occurred
between or among the Company and any of its officers or directors,
shareholders or any affiliate or affiliates of any such officer or
director or shareholder that is required to be described in and is
not described in the Registration Statement and the
Prospectus.
(u) The Company has not taken, nor
will it take, directly or indirectly, any action designed to or
which might reasonably be expected to cause or result in, or which
has constituted or which might reasonably be expected to
constitute, the stabilization or manipulation of the price of the
Common Stock or any security of the Company to facilitate the sale
or resale of any of the Shares.
(v) The Company has filed all
Federal, state, local and foreign tax returns which are required to
be filed through the date hereof, which returns are true and
correct in all material respects, or has received timely extensions
thereof, and has paid all taxes shown on such returns and all
assessments received by it to the extent that the same are material
and have become due and are not being contested in good faith.
There are no tax audits or investigations pending, which if
adversely determined would have a Material Adverse Effect; nor are
there any material proposed additional tax assessments against the
Company.
(w) The Shares have been duly
authorized for quotation on the National Association of Securities
Dealers Automated Quotation (“Nasdaq”) National Market
System, subject to official notice of issuance.
(x) The Company has taken no action
designed to, or likely to have the effect of, terminating the
registration of the Common Stock under the Exchange Act or the
quotation of the Common Stock on the Nasdaq National Market, nor,
since May 21, 2003, has the Company received any notification that
the Commission or the Nasdaq National Market is contemplating
terminating such registration or quotation.
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(y) The books, records and accounts
of the Company accurately and fairly reflect, in reasonable detail,
the transactions in, and dispositions of, the assets of, and the
results of operations of, the Company. The Company maintains a
system of internal accounting controls sufficient to provide
reasonable assurances that (i) transactions are executed in
accordance with management’s general or specific
authorizations, (ii) transactions are recorded as necessary to
permit preparation of financial statements in accordance with
generally accepted accounting principles and to maintain asset
accountability, (iii) access to assets is permitted only in
accordance with management’s general or specific
authorization and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences; the
chief executive officer and the chief financial officer of the
Company have made all certifications required by the Sarbanes-Oxley
Act of 2002 (the “Sarbanes-Oxley Act”) and any related
rules and regulations promulgated by the Commission, and the
statements contained in any such certification are complete and
correct; the Company is otherwise in compliance in all material
respects with all applicable effective provisions of the
Sarbanes-Oxley Act and is actively taking steps to ensure that it
will be in compliance with other applicable provisions of the
Sarbanes-Oxley Act upon the effectiveness of such
provisions.
(z) The Company has established and
maintains disclosure controls and procedures (as such term is
defined in Rule 13a-15 under the Exchange Act). Based on the
evaluation of its disclosure controls and procedures, management of
the Company has disclosed to E&Y, to the Audit Committee of the
Company’s Board of Directors and to the Placement Agents (i)
any significant deficiency or any material weakness in the design
or operation of internal controls which is reasonably likely to
adversely affect the Company’s ability to record, process,
summarize and report financial information; or (ii) any fraud,
whether or not material, that involves management or other
employees who have a significant role in the Company’s
internal controls. Since the date of the most recent evaluation of
such disclosure controls and procedures, there have been no changes
that have materially affected, or are reasonably likely to
materially affect, the Company’s internal control over
financial reporting, including any corrective actions with regard
to significant deficiencies and material weaknesses.
(aa) There are no material
off-balance sheet arrangements (as defined in Item 303 of
Regulation S-K) that have or are reasonably likely to have a
material current or future effect on the Company’s financial
condition, revenues or expenses, changes in financial condition,
results of operations, liquidity, capital expenditures or capital
resources.
(bb) The Company’s Board of
Directors has validly appointed an audit committee whose
composition satisfies the requirements of Rule 4350(d)(2) of the
Rules of the NASD and the Board of Directors and/or the audit
committee has adopted a charter that satisfies the requirements of
Rule 4350(d)(1) of the NASD Rules. The audit committee has reviewed
the adequacy of its charter within the past twelve
months.
(cc) The Company is insured by
insurers of recognized financial responsibility against such losses
and risks and in such amounts as are customary at the
Company’s
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stage of development in the
businesses in which it is engaged or proposes to engage after
giving effect to the transactions described in the Prospectus; all
policies of insurance and fidelity or surety bonds insuring the
Company or the Company’s respective businesses, assets,
employees, officers and directors are in full force and effect; the
Company is in compliance with the terms of such policies and
instruments in all material respects; and the Company has no reason
to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar
coverage from similar insurers as may be necessary to continue its
business at a cost that is not materially greater than the current
cost.
(dd) Each approval, consent, order,
authorization, designation, declaration or filing of, by or with
any regulatory, administrative or other governmental body necessary
in connection with the execution and delivery by the Company of
this Agreement and the consummation of the transactions herein
contemplated required to be obtained or performed by the Company
(except for filings with the Commission pursuant to Rule 424(b) of
the Rules or Nasdaq and such additional steps as may be necessary
to qualify the Shares under the state securities or Blue Sky laws)
has been obtained or made and is in full force and
effect.
(ee) There are no affiliations with
the NASD among the Company’s officers, directors or, to the
best of the knowledge of the Company, any five percent or greater
stockholder of the Company, except as set forth in the Registration
Statement or otherwise disclosed in writing to the Placement
Agents. The Placement Agents acknowledge that William N. Shiebler
is the Chief Executive Officer in the Americas for Deutsche Asset
Management, a members of the Deutsche Bank Group, and is a member
of the Deutsche Asset Management Global Executive Committee.
Deutsche Bank Group is an NASD member. In addition, Arthur B.
Laffer is a co-founder, Chairman and Chief Executive Officer of
Laffer Advisers, Inc., a broker-dealer and NASD member.
(ff) (i) The Company is in
compliance in all material respects with all rules, laws and
regulation relating to the use, treatment, storage and disposal of
toxic substances and protection of health or the environment
(“Environmental Law”) which are applicable to its
business; (ii) the Company has not received any notice from any
governmental authority or third party of an asserted claim under
Environmental Laws; (iii) the Company has received all permits,
licenses or other approvals required of it under applicable
Environmental Laws to conduct its business and is in compliance
with all terms and conditions of any such permit, license or
approval except where such failure to receive, or comply with,
required permits, licenses or approvals would not, individually or
in the aggregate, have a Material Adverse Effect; (iv) to the
Company’s knowledge, no facts currently exist that will
require the Company to make future material capital expenditures to
comply with Environmental Laws; and (v) to the Company’s
knowledge, no property which is or has been owned, leased or
occupied by the Company has been designated as a Superfund site
pursuant to the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended (42 U.S.C. Section 9601, et.
seq.) or otherwise designated as a contaminated site under
applicable state or local law. The Company has not been named as a
“potentially responsible party” under the CER, CLA
1980.
11
(gg) The Company is not and, after
giving effect to the offering and sale of the Shares and the
application of proceeds thereof as described in the Prospectus,
will not be an “investment company” within the meaning
of the Investment Company Act of 1940, as amended.
(hh) Neither the Company nor any
person associated with or acting on behalf of the Company
including, without limitation, any director, officer, agent or
employee of the Company has, directly or indirectly, while acting
on behalf of the Company (i) used any corporate funds for unlawful
contributions, gifts, entertainment or other unlawful expenses
relating to political activity; (ii) made any unlawful payment to
foreign or domestic government officials or employees or to foreign
or domestic political parties or campaigns from corporate funds; or
(iii) violated any provision of the Foreign Corrupt Practices Act
of 1977, as amended.
(ii) The operations of the Company
are in compliance with applicable financial record keeping and
reporting requirements of the Currency and Foreign Transactions
Reporting Act of 1970, as amended, the money laundering statutes of
all jurisdictions, the rules and regulations thereunder and any
related or similar rules, regulations or guidelines, issued,
administered or enforced by any governmental agency (collectively,
the “Money Laundering Laws”) and no action, suit or
proceeding by or before any court or governmental agency, authority
or body or any arbitrator involving the Company with respect to the
Money Laundering Laws is pending, or to the knowledge of the
Company, threatened.
(jj) Neither the Company nor, to the
knowledge of the Company, any director, officer, agent, employee or
affiliate of the Company is currently subject to any U.S. sanctions
administered by the Office of Foreign Assets Control of the U.S.
Treasury Department (“OFAC”); and the Company will not
directly or indirectly use the proceeds of the offering, or lend,
contribute or otherwise make available such proceeds to any
subsidiary, joint venture partner or other person or entity, for
the purpose of financing the activities of any person currently
subject to any U.S. sanctions administered by OFAC.
(kk) Except as described in the
Prospectus or in the documents incorporated by reference into the
Prospectus, the Company has not sold or issued any shares of Common
Stock during the six-month period preceding the date of the
Prospectus, including any sales pursuant to Rule 144A under, or
Regulations D or S under, the Securities Act, other than shares
issued pursuant to employee benefit plans, qualified stock option
plans or other employee compensation plans or pursuant to
outstanding options, rights or warrants.
(ll) The Company has fulfilled its
obligations, if any, under the minimum funding standards of Section
302 of the U.S. Employee Retirement Income Security Act of 1974
(“ERISA”) and the regulations and published
interpretations thereunder with respect to each “plan”
as defined in Section 3(3) of ERISA and such regulations and
published interpretations in which its employees are eligible to
participate and each such plan is in compliance in all material
respects with the presently applicable provisions of ERISA and such
regulations and published interpretations. No “Reportable
Event” (as defined in 12 ERISA) has occurred with respect to
any “Pension Plan” (as defined
