EXHIBIT 1.1
1,000,000 SHARES
ENZO BIOCHEM, INC.
COMMON STOCK
PLACEMENT
AGENT AGREEMENT
-------------------------
February 2, 2007
LAZARD CAPITAL MARKETS LLC
30 Rockefeller Plaza
New York, New York 10020
Dear Sirs:
1.
INTRODUCTION. ENZO
BIOCHEM, INC., a New
York corporation
(the
"COMPANY"), proposes
to issue and sell to the purchaser, pursuant to the terms
of this Placement
Agent Agreement (this "AGREEMENT") and the Subscription
Agreement in
the form of EXHIBIT A attached hereto (the "SUBSCRIPTION
AGREEMENT")
entered into
with the purchaser identified therein (the
"PURCHASER"), up to an
aggregate of 1,000,000 shares of common stock, $0.01 par
value per share (the "COMMON STOCK") of the Company. The aggregate of 1,000,000
shares so proposed to be sold is hereinafter referred to as the "STOCK." The
Company hereby
confirms its agreement with Lazard Capital Markets LLC to act
as
Placement Agent
("LCM," or the "PLACEMENT AGENT") in accordance with the
terms
and conditions hereof.
2. AGREEMENT
TO ACT AS PLACEMENT AGENT; PLACEMENT OF SECURITIES. On
the basis of the
representations,
warranties and
agreements
of the Company
herein contained, and subject to all the terms and conditions of
this Agreement:
2.1
The Company hereby authorizes the Placement Agent to act
as its exclusive agent to solicit offers for the purchase of all or
part
of the Stock from the Company in connection with the proposed offering
of the Stock (the
"OFFERING"). Until the
Closing Date (as defined in
SECTION 4 hereof), the
Company shall not,
without the prior written
consent of the
Placement Agent,
solicit or accept
offers to purchase
Stock otherwise than
through the Placement
Agent. LCM may utilize
the
expertise of Lazard Freres & Co. LLC in connection with LCM's placement
agent activities.
2.2
The Placement Agent agrees, as agent of the Company, to
use its commercially
reasonable
efforts to solicit
offers to purchase
the Stock from the
Company on the terms and subject to the conditions
set forth in the
Prospectus (as defined
below). The Placement Agent
shall use commercially
reasonable
efforts to assist the Company in
obtaining performance by the Purchaser whose offer to purchase
Stock has
been solicited by the Placement Agent and accepted by the Company,
but
the Placement
Agent shall not,
except as otherwise provided in this
Agreement, be
obligated to disclose the identity of any potential
purchaser or have
any liability to the Company in the event such
purchase is not consummated for any reason. Under no circumstances will
the Placement Agent be obligated to underwrite or purchase any
Stock for
its own account and, in soliciting purchases of Stock, the Placement
Agent shall act
solely as the
Company's agent and not as principal.
Notwithstanding the
foregoing and except as otherwise provided in
SECTION 2.3, it is understood and agreed that the Placement Agent (or
its affiliates) may, solely at its discretion and without any
obligation
to do so, purchase Stock as principal on the same terms as the
Purchaser.
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2.3
Subject to the
provisions of this SECTION 2, offers for
the purchase of Stock may be solicited by the Placement Agent as agent
for the Company at such times and in such amounts as the Placement
Agent
deems advisable. The
Placement Agent shall
communicate to the Company,
orally or in writing,
each reasonable offer
to purchase Stock received
by it as agent of the Company. The Company shall have the sole
right to
accept offers to
purchase the Stock and
may reject any such offer, in
whole or in part. The
Placement Agent shall have the right, in its
discretion reasonably
exercised,
without notice to the Company, to
reject any offer to purchase Stock received by it, in whole or
in part,
and any such rejection
shall not be
deemed a breach of its
agreement
contained herein.
2.4
The Stock is being sold to the Purchaser at a price of
$15.00 per share. The
purchase of the Stock by the Purchaser shall be
evidenced by the
execution of
Subscription Agreement
by the Purchaser
and the Company.
2.5
As compensation for
services rendered,
on the Closing
Date (as defined
in SECTION 4 hereof),
the Company shall pay to the
Placement Agent by
wire transfer of immediately available funds to an
account or accounts
designated by the
Placement Agent, an aggregate
amount equal to five percent (5.0%) of the gross proceeds received by
the Company from the sale of the Stock on such Closing Date.
2.6
No Stock which the
Company has agreed to sell pursuant
to this Agreement
shall be deemed to
have been purchased and paid for,
or sold by the
Company, until such
Stock shall have been
delivered to
the Purchaser thereof against payment by such Purchaser.
If the Company
shall default in its
obligations to deliver Stock to a Purchaser whose
offer it has
accepted, the Company shall indemnify and hold the
Placement Agent
harmless against any loss, claim, damage or expense
arising from or as a result of such default by the Company in
accordance
with the procedures set forth in Section 8(c) herein.
3.
REPRESENTATIONS AND
WARRANTIES
OF THE COMPANY. The Company
represents and
warrants to, and agrees with, the Placement Agent and the
Purchaser that:
(a)
The Company has
prepared and filed in
conformity with
the requirements
of the Securities Act of 1933, as amended (the
"SECURITIES ACT"), and
published rules and regulations thereunder (the
"RULES AND
REGULATIONS")
adopted
by the Securities and Exchange
Commission (the
"COMMISSION")
a "shelf" Registration Statement (as
hereinafter defined)
on Form S-3 (File No.
333-138417), which
became
effective as of
December 8, 2006 (the
"EFFECTIVE DATE"),
including a
base prospectus relating to the Stock (the "BASE PROSPECTUS"),
and such
amendments and supplements thereto as may have been required to the
date
of this Agreement.
The term "REGISTRATION STATEMENT" as used in this
Agreement means the
registration
statement (including all exhibits,
financial schedules
and all documents and
information
deemed to be a
part of the
Registration Statement
pursuant to Rule 430A under the
Securities Act),
as amended
and/or supplemented to the date of this
Agreement, including
the Base Prospectus. 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 no proceedings for that purpose have been
instituted or,
to the knowledge of the Company, are threatened by the Commission.
The
Company, if required
by the Rules and
Regulations of the
Commission,
will file the
Prospectus
(as defined below), with the Commission
pursuant to
Rule 424(b) of the Rules and Regulations. The term
"PROSPECTUS" as used in this Agreement means the Prospectus, in the
form
in which it is to be filed with the Commission pursuant to Rule 424(b)
of the Rules and
Regulations, or, if
the Prospectus is not to be filed
with the Commission
pursuant to Rule 424(b), the Prospectus in the form
included as part of the Registration Statement as of the Effective
Date,
except that if any revised prospectus or
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prospectus supplement
shall be provided to
the Placement Agent by
the
Company for use in
connection with the
offering and sale of
the Stock
which differs
from the Prospectus (whether or not such revised
prospectus or
prospectus
supplement
is required to be filed by the
Company pursuant to Rule 424(b) of the Rules and Regulations),
the term
"PROSPECTUS" shall
refer to such revised prospectus or prospectus
supplement, as the
case may be, from
and after the time it is first
provided to the Placement Agent for such use. Any preliminary
prospectus
or prospectus
subject to completion included in the Registration
Statement or filed
with the Commission
pursuant to Rule 424
under the
Securities Act is
hereafter called a "PRELIMINARY PROSPECTUS." Any
reference herein
to the Registration Statement, any Preliminary
Prospectus or the Prospectus shall be deemed to refer to and
include the
documents
incorporated by
reference therein pursuant to Item 12 of Form
S-3 which were filed
under the Securities Exchange Act of 1934, as
amended (the
"EXCHANGE ACT"), on or before the last to occur of the
Effective Date, the date of the Preliminary Prospectus, or the date of
the Prospectus,
and any reference herein to the terms "amend,"
"amendment," or "supplement" with respect to the Registration
Statement,
any Preliminary Prospectus or the Prospectus shall be deemed to
refer to
and include (i) the filing of any document under the Exchange Act after
the Effective Date, the date of such Preliminary Prospectus or the date
of the Prospectus,
as the case may be, which is incorporated by
reference and (ii) any such document so filed. If the Company has filed
an abbreviated
registration
statement to register additional Stock
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.
(b)
As of the Applicable
Time (as defined
below) and as of
the Closing Date,
neither (i) any
General Use Free Writing Prospectus
(as defined below)
issued at or prior to the Applicable Time, and the
Pricing Prospectus (as
defined below) and the
information included
on
SCHEDULE A hereto, all
considered together
(collectively, the
"GENERAL
DISCLOSURE PACKAGE"),
nor (ii) any
individual Limited Use Free Writing
Prospectus (as defined below), when considered together with the
General
Disclosure Package,
included or will include, any untrue statement of a
material fact or omitted or as of the Closing Date will omit, to
state a
material fact necessary in order to make the statements
therein, in the
light of the
circumstances under
which they were made, not misleading;
PROVIDED,
HOWEVER, that
the Company makes no representations or
warranties as to
information
contained in or omitted from any Issuer
Free Writing
Prospectus, in
reliance upon,
and in conformity with,
written information
furnished to the Company by the Placement Agent
specifically for inclusion therein, which information the parties
hereto
agree is limited to the Placement Agent's Information (as defined in
SECTION 17).
As used in this PARAGRAPH (B) and elsewhere in this
Agreement:
"APPLICABLE TIME"
means 2:00 P.M., New
York time, on the date
of this
Agreement.
"PRICING PROSPECTUS" means the Preliminary Prospectus, if any, and the
Base Prospectus, each
as amended and supplemented immediately prior to
the Applicable Time,
including any document
incorporated by
reference
therein and any prospectus supplement deemed to be a part
thereof.
"ISSUER FREE
WRITING PROSPECTUS" means any "issuer free writing
prospectus," as defined in Rule 433(h) under the Securities Act
relating
to the Stock
in the form filed or required to be filed with the
Commission or, if not required to be filed, in the form retained in the
Company's records pursuant to Rule 433(g) under the Securities
Act.
"GENERAL USE FREE
WRITING PROSPECTUS" means any Issuer Free Writing
Prospectus that is identified on SCHEDULE A to this Agreement.
"LIMITED USE FREE
WRITING PROSPECTUSES"
means any Issuer Free
Writing
Prospectus that is not a General Use Free Writing Prospectus.
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(c)
No order preventing or suspending the use of any
Preliminary
Prospectus, any
Issuer Free Writing Prospectus or the
Prospectus relating to
the Offering has been issued by the Commission,
and no proceeding
for that purpose or pursuant to Section 8A of the
Securities Act has been instituted or threatened by the Commission,
and
each Preliminary Prospectus, at the time of filing thereof,
conformed in
all material
respects to the
requirements of the Securities Act and the
Rules and Regulations,
and did 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 the light
of the
circumstances under
which they were made,
not misleading; PROVIDED,
HOWEVER, that the
Company makes no
representations or warranties as to
information contained in or omitted from any Preliminary
Prospectus, in
reliance upon, and in conformity with, written information
furnished to
the Company by the Placement Agent specifically for inclusion
therein,
which information
the parties hereto
agree is limited to the Placement
Agent's Information (as defined in SECTION 17).
(d)
At the time the Registration Statement became effective,
at the date of this Agreement and at the Closing Date, the
Registration
Statement conformed
and will conform in
all material
respects to the
requirements of the Securities Act and the Rules and Regulations
and did
not and will not contain any untrue statement of a material fact or
omit
to state any material fact required to be stated therein or
necessary to
make the statements therein not misleading; the Prospectus, at the time
the Prospectus
was issued and at the
Closing Date,
conformed and will
conform in all material respects to the requirements of the Securities
Act and the Rules and
Regulations and did
not and will not
contain 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,
HOWEVER, that the
foregoing representations and warranties in this
PARAGRAPH (D) shall
not apply to
information contained
in or omitted
from the Registration
Statement or the Prospectus in reliance upon, and
in conformity with, written information furnished to the Company by
the
Placement Agent
specifically for inclusion therein, which information
the parties hereto agree is limited to the Placement Agent's
Information
(as defined in SECTION 17).
(e)
Each Issuer Free Writing Prospectus, if any, as of its
issue date and at all
subsequent times
through the
completion of the
public offer and sale
of the Stock or until any earlier date that the
Company notified or notifies the Placement Agent as described in
SECTION
5(E), did not, does not and will not include any information that
conflicted, conflicts or will conflict with the information
contained in
the Registration
Statement,
Pricing Prospectus or the Prospectus,
including any
document incorporated by reference therein and any
prospectus supplement
deemed to be a part thereof that has not been
superseded or
modified, or includes
an untrue statement of
a material
fact or omitted or would omit 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
prevailing at the subsequent time, not
misleading. The
foregoing sentence does not apply to
statements in or
omissions from any Issuer Free Writing Prospectus in reliance upon,
and
in conformity with, written information furnished to the Company by
the
Placement Agent
specifically for inclusion therein, which information
the parties hereto agree is limited to the Placement Agent's
Information
(as defined in SECTION 17).
(f)
The documents
incorporated
by reference in the
Prospectus, when
they became effective or were filed with the
Commission, as the
case may be, conformed
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 none of such documents contained any untrue statement of
a material
fact or omitted to state any material fact required to be stated
therein
or necessary to make
the statements
therein not
misleading;
and any
further documents
so filed and incorporated by reference in the
Prospectus, when such
documents become
effective or
4
<PAGE>
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
any untrue statement
of a
material fact or omit
to state any material
fact required to be stated
therein or necessary to make the statements therein not
misleading.
(g)
The Company has not, directly or indirectly, distributed
and will not
distribute any
offering material in
connection with
the
Offering other than any Preliminary Prospectus, the Prospectus and
other
materials, if any,
permitted under the Securities Act and consistent
with SECTION 5(B) below. The Company will file with the
Commission all
Issuer Free
Writing Prospectuses, if any, in the time and manner
required under Rule 433(d) under the Securities Act.
(h)
The Company
and each of its
Subsidiaries
(as defined
below) has
been duly organized and is validly existing as a corporation
or other legal
entity in good standing (or the foreign equivalent
thereof) under the laws of its respective jurisdiction of organization.
The Company
and each of its Subsidiaries is duly qualified to do
business and is in good standing as a foreign corporation or other
legal
entity in each
jurisdiction in which its respective ownership or lease
of property or the
conduct of its
respective business
requires such
qualification and has
all power and authority (corporate or other)
necessary to own or hold its respective properties and to conduct the
business in which it is engaged, except where the failure to so
qualify
or have such power or authority (i) would not have, singularly or
in the
aggregate, a material
adverse effect on the condition (financial or
otherwise), results of operations, assets or business of the
Company and
its Subsidiaries, or
(ii) impair in any material respect the ability of
the Company to perform
its obligations under this Agreement or to
consummate any transactions contemplated by the Agreement,
the General
Disclosure Package or
the Prospectus
(any such effect as
described in
clauses (i) or (ii), a "MATERIAL ADVERSE EFFECT"). The Company owns or
controls, directly
or indirectly, only the following corporations,
partnerships,
limited
liability
partnerships,
limited liability
companies,
associations or other entities: Enzo Clinical Labs, Inc., a
New York corporation,
Enzo Life Sciences, Inc., a New York corporation,
Enzo Therapeutics,
Inc., a New York corporation and Enzo Realty, LLC, a
New York limited
liability company,
each, a "SUBSIDIARY"
and together
"SUBSIDIARIES".
(i)
The Company has the full right, power and authority to
enter into this Agreement and the Subscription Agreement and to perform
and to discharge its obligations hereunder and thereunder;
and each of
this Agreement and the Subscription Agreement has been duly
authorized,
executed and
delivered by the Company, and constitutes a valid and
binding obligation of
the Company
enforceable in
accordance with
its
terms.
(j)
The Stock to be issued
and sold by the
Company to the
Purchaser hereunder
and under the Subscription Agreement has been duly
and validly authorized
and, when issued and
delivered against
payment
therefor as provided herein and the Subscription Agreement, will be
duly
and validly
issued, fully paid and nonassessable and free of any
preemptive or similar rights and will conform to the description
thereof
contained in the General Disclosure Package and the Prospectus.
(k)
The Company
has an authorized capitalization as set
forth in the Pricing Prospectus, and all of the issued shares of
capital
stock of the Company have been duly and validly authorized and issued,
are fully paid and
non-assessable, have
been issued in compliance with
federal and state
securities
laws, and conform to the description
thereof contained in the General Disclosure Package and the
Prospectus.
As of December 31, 2006, there were 35,651,559 shares of Common Stock
outstanding and no
shares of Preferred
Stock, par value $0.01 of the
Company issued and
outstanding.
As of December 31,
2006, the Company
held
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<PAGE>
569,763 shares of Common Stock in its treasury, and 2,863,213 shares of
Common Stock were
issuable upon the
exercise of all options, warrants
and convertible securities outstanding as of such date. Since such
date,
the Company has not issued any securities, other than Common Stock of
the Company issued pursuant to the exercise of stock options
previously
outstanding under the
Company's stock option plans or the issuance
of
restricted Common
Stock pursuant to employee stock purchase plans. None
of the outstanding shares of Common Stock was issued in violation
of any
preemptive rights,
rights of first
refusal or other similar rights to
subscribe for or
purchase securities of the Company. There are no
authorized or outstanding shares of capital stock,
options, warrants,
preemptive rights,
rights of first refusal or other rights to purchase,
or equity or debt securities convertible into or exchangeable or
exercisable for,
any capital stock of the Company or any of its
Subsidiaries other than those described above or accurately
described in
the General Disclosure
Package. The
description of the Company's stock
option, stock
bonus and other
stock plans or arrangements, and the
options or other rights granted thereunder, as described in the General
Disclosure Package and the Prospectus, accurately and fairly
present the
information
required to
be shown with respect to such plans,
arrangements, options and rights.
(l)
All the outstanding
shares of capital stock of each
Subsidiary have been duly authorized and validly issued,
are fully paid
and nonassessable
and, except to the extent set forth in
the General
Disclosure Package or the Prospectus, are owned by the Company
directly
or indirectly through
one or more wholly-owned subsidiaries, free and
clear of any claim, lien, encumbrance, security interest, restriction
upon voting or transfer or any other claim of any third party.
(m)
The execution,
delivery
and performance of this
Agreement and the Subscription Agreement by the Company,
the issue and
sale of the Stock by the Company and the consummation of the
transactions
contemplated hereby
and thereby will not (with or without
notice or lapse of time or both) conflict with or result in a
breach or
violation of any of
the terms or
provisions of,
constitute a
default
under, give
rise to any
right of termination or other right or the
cancellation or
acceleration
of any right or
obligation or loss of
a
benefit under,
or give rise to the
creation or imposition of any lien,
encumbrance, security
interest, claim or charge upon any
property or
assets of the Company
or any Subsidiary
pursuant to, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument
to which the Company or any of its Subsidiaries is a party or by which
the Company or any of its Subsidiaries is bound or to which any of
the
property or assets of the Company or any of its Subsidiaries is
subject,
nor will such actions
result in any violation of the provisions of the
charter or by-laws (or analogous governing instruments, as applicable)
of the Company
or any of its
Subsidiaries or any
law, statute,
rule,
regulation, judgment,
order or decree of any court or governmental
agency or body,
domestic or foreign, having jurisdiction over the
Company or any of its Subsidiaries or any of their properties or
assets.
(n)
Except for the
registration
of the Stock under the
Securities Act
and such consents, approvals, authorizations,
registrations or
qualifications
as may be required
under the Exchange
Act and applicable
state or foreign securities laws, the National
Association of Securities Dealers, Inc. and the New York Stock
Exchange
(the "NYSE") in
connection
with the offering and
sale of the Stock by
the Company, no consent, approval, authorization or order of, or
filing,
qualification or registration with, any court or governmental
agency or
body, foreign or
domestic, which has
not been made,
obtained or taken
and is not in full force and effect, is required for the execution,
delivery and
performance
of this Agreement and the Subscription
Agreement by the
Company, the offer or sale of the Stock or the
consummation of the transactions contemplated hereby or
thereby.
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(o)
Ernst & Young LLP, who have certified certain financial
statements and related
schedules included or
incorporated by reference
in the Registration
Statement, the General
Disclosure Package and
the
Prospectus, and
have audited the Company's internal control over
financial
reporting and
management's
assessment
thereof,
is an
independent registered
public accounting firm as required by the
Securities Act and the
Rules and Regulations
and the Public Company
Accounting Oversight Board (United States) (the "PCAOB").
Ernst & Young
LLP have not been
engaged by the Company
to perform
any "prohibited
activities" (as defined in Section 10A of the Exchange Act).
(p)
The financial
statements,
together with the related
notes and schedules,
included or incorporated by reference in the
General Disclosure
Package, the Prospectus and in the Registration
Statement fairly present in all material respects the financial
position
and the results of operations and changes in financial
position of the
Company and
its consolidated subsidiaries and other consolidated
entities at the respective dates or for the respective
periods therein
specified. Such
statements
and related notes and
schedules have
been
prepared in accordance with the generally accepted accounting
principles
in the United States ("GAAP") applied on a consistent
basis throughout
the periods involved
except as may be set
forth in the related
notes
included or incorporated by reference in the General Disclosure
Package.
The financial statements, together with the related notes and
schedules,
included or incorporated by reference in the General Disclosure Package
and the Prospectus
comply in all material
respects with the Securities
Act, the Exchange Act, and the Rules and Regulations and the rules and
regulations under the
Exchange Act. No other
financial statements or
supporting schedules
or exhibits are required by the Securities Act or
the Rules and
Regulations to be described, or included or incorporated
by reference
in the Registration Statement, the General Disclosure
Package
or the Prospectus. There is no pro forma or as adjusted
financial
information
which is required to be included in the
Registration
Statement, the
General Disclosure Package, or and the
Prospectus or a document incorporated by reference therein in
accordance
with the Securities Act and the Rules and Regulations which has not
been
included or incorporated as so required. The pro forma and pro forma as
adjusted financial
information
and the related notes included or
incorporated by
reference in the
Registration
Statement, the
General
Disclosure Package and
the Prospectus have
been properly compiled
and
prepared in
accordance
with
the applicable requirements of the
Securities Act and the
Rules and Regulations
and present fairly the
information shown
therein, and the
assumptions used in the preparation
thereof are reasonable and the adjustments used therein are appropriate
to give effect to the transactions and circumstances referred to
therein.
(q)
Neither the
Company nor any of its Subsidiaries has
sustained, since the
date of the latest
audited financial
statements
included or incorporated by reference in the General Disclosure
Package,
any material
loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by
insurance,
or from any labor
dispute or court or
governmental
action, order or
decree, otherwise
than as set
forth or contemplated in the General
Disclosure Package;
and, since such date, there has not been any change
in the capital
stock or long-term debt of the Company or any of its
Subsidiaries, or any
material adverse changes, or any development
involving a prospective material adverse change, in or affecting the
business, assets,
general affairs, management, financial position,
prospects,
stockholders' equity or results of operations of the Company
and its Subsidiaries, otherwise than as set forth or contemplated
in the
General Disclosure Package.
(r)
Except as set forth in the General Disclosure Package,
there is no legal or
governmental action,
suit, claim or proceeding
pending to which the Company or any of its Subsidiaries is a party
or of
which any property or
assets of the Company or any of its Subsidiaries
is the subject which
is required to be
described in the
Registration
Statement, the
General Disclosure Package or the Prospectus or a
document incorporated by reference therein
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and is not described therein, or which, singularly or in the
aggregate,
if determined adversely to the Company or any of its Subsidiaries,
could
have a
Material Adverse Effect or prevent the consummation of the
transactions
contemplated hereby;
and to the
best of the Company's
knowledge, no
such proceedings are threatened or contemplated by
governmental authorities or threatened by others.
(s)
Neither the Company
nor any of its
Subsidiaries is in
(i) violation
of its charter or by-laws (or analogous governing
instrument, as
applicable), (ii)
default in any respect, and no event
has occurred
which, with notice or lapse of time or both, would
constitute such a
default, in the due
performance or observance of any
term, covenant or condition contained in any indenture,
mortgage, deed
of trust, loan
agreement,
lease or other
agreement or
instrument to
which it is a party or
by which it is bound or to which any of its
property or assets is subject or (iii) violation in any respect of any
law, ordinance,
governmental rule, regulation or court order, decree or
judgment to which it or its property or assets may be subject
except, in
the case of clauses
(ii) and (iii) of this paragraph (s), for any
violations or defaults which, singularly or in the aggregate,
would not
have a Material Adverse Effect.
(t)
The Company
and each of its
Subsidiaries
possess all
licenses,
certificates,
authorizations and permits issued by, and have
made all declarations
and filings with, the appropriate local, state,
federal or foreign regulatory agencies or bodies which are
necessary or
desirable for the ownership of its respective properties or the conduct
of its respective
businesses
as described
in the General
Disclosure
Package and the Prospectus (collectively, the "GOVERNMENTAL PERMITS")
except where any failures to possess or make the same, singularly or in
the aggregate, would not have a Material Adverse Effect. The
Company and
its Subsidiaries is in
compliance with all such Governmental Permits;
all such Governmental
Permits are valid and in full force and
effect,
except where the
validity or failure to be in full force and effect
would not, singularly
or in the aggregate, have a Material Adverse
Effect. All
such Governmental Permits are free and clear of any
restriction or
condition that are in addition to, or materially
different from
those normally applicable to similar licenses,
certificates,
authorizations and
permits. Neither the
Company nor any
subsidiary has received notification of any revocation or
modification
(or proceedings related thereto) of any such Governmental Permit
and the
Company has no reason to believe that any such Governmental
Permit will
not be renewed.
(u)
Neither the Company nor any of its Subsidiaries is or,
after giving effect to the offering of the Stock and the
application of
the proceeds thereof as described in the General Disclosure Package and
the Prospectus, will
become an "investment
company" within the meaning
of the Investment
Company Act of 1940,
as amended,
and the rules and
regulations of the Commission thereunder.
(v)
Neither the
Company, its Subsidiaries nor, to the
Company's knowledge, any of the Company's or its Subsidiaries'
officers,
directors or affiliates has taken or will take, directly or indirectly,
any action designed or
intended to stabilize or manipulate the price of
any security of the
Company, or which caused or resulted in, or
which
might in the future
reasonably
be expected to cause or result in,
stabilization or
manipulation
of the price of any security of the
Company.
(w)
The Company
and its Subsidiaries own or possess the
right to use all patents, trademarks, trademark registrations,
service
marks, service mark registrations, trade names, copyrights, licenses,
inventions, software,
databases, know-how, Internet domain names, trade
secrets and
other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures, and other
intellectual
property (collectively, "INTELLECTUAL PROPERTY") necessary to carry
on
their respective
businesses as currently conducted, and as proposed to
be conducted and
8
<PAGE>
described in the General Disclosure Package and the Prospectus,
and the
Company is not aware of any claim to the contrary or any challenge by
any other person to the rights of the Company and its Subsidiaries
with
respect to the foregoing except for those that could not have a
Material
Adverse Effect. The
Intellectual
Property licenses described in the
General Disclosure
Package and the Prospectus are valid, binding upon,
and enforceable by or against the parties thereto in accordance to
their
terms. The Company and each of its
Subsidiaries
have complied in all
material respects
with, and are not, to the Company's
knowledge,
in
breach nor have received any asserted or threatened claim of breach of,
any Intellectual
Property license, and
the Company has no knowledge of
any breach or anticipated breach by any other person to any
Intellectual
Property license. The Company's and each of its Subsidiaries'
businesses
as now conducted and as proposed to be conducted do not and will
not, to
the Company's
knowledge,
infringe
or conflict with any patents,
trademarks, service
marks, trade names, copyrights, trade secrets,
licenses or
other Intellectual Property or franchise right of any
person. No claim has been received by the Company that makes
against the
Company or any of its
Subsidiaries an allegation of infringement by the
Company or any of its
Subsidiaries of any
patent, trademark,
service
mark, trade
name, copyright, trade secret, license in or other
intellectual property
right or franchise right of any person. The
Company and each of its Subsidiaries have taken all reasonable steps
to
protect, maintain and safeguard its rights in all Intellectual
Property,
including the execution of appropriate nondisclosure and
confidentiality
agreements. The
consummation of the
transactions
contemplated by this
Agreement will not, to
the Company's
knowledge, result in
the loss or
impairment of or payment of any additional amounts with respect to, nor
require the consent of any other person in respect of, the
Company's or
any of its
Subsidiaries' right to
own, use, or hold for use any of the
Intellectual Property
as owned, used or held
for use in the conduct of
the businesses
as currently conducted. The Company and each of its
Subsidiaries has at
all times taken reasonable steps to comply with all
applicable laws relating to privacy, data protection, and the
collection
and use of personal information collected, used, or held for use by the
Company and any of its
Subsidiaries in the conduct of the Company's and
its Subsidiaries businesses. No claims have been received by the
Company
or any of its Subsidiaries alleging a violation of any
person's privacy
or personal
information
or data rights and the consummation of the
transactions
contemplated hereby will not, to the Company's knowledge,
breach or otherwise
cause any violation of
any law related to privacy,
data protection,
or the collection and use of personal information
collected, used,
or held for use by the Company or any of its
Subsidiaries in the conduct of the Company's or any of its
Subsidiaries'
businesses. The
Company and each of its Subsidiaries takes reasonable
measures to
ensure that such information is protected against
unauthorized access, use, modification, or other misuse.
(x)
Except as set forth in the General Disclosure Package,
there is no legal or
governmental action,
suit, claim or proceeding
pending to which the Company or any of its Subsidiaries is a party
or of
which any property or
assets of the Company or any of its Subsidiaries
is the subject,
including any proceeding before the United States Food
and Drug
Administration of the
U.S. Department
of Health and Human
Services ("FDA")
or comparable federal, state, local or foreign
governmental bodies
(it being understood
that the interaction
between
the Company and the FDA and such comparable governmental bodies
relating
to the clinical
development and product approval process shall not be
deemed proceedings
for purposes of this representation), which is
required to be
described in the
Registration
Statement,
the General
Disclosure Package
or the Prospectus or a document incorporated by
reference therein and is not described therein, or which,
singularly or
in the aggregate, if
determined adversely
to the Company or any of its
Subsidiaries, could
reasonably be expected
to have a Material
Adverse
Effect or prevent the
consummation
of the transactions contemplated
hereby; and
to the Company's Knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened by
others. The
Company and its
Subsidiaries
is in compliance with all
applicable federal, state, local and foreign laws, regulations, orders
and decrees governing
its
9
<PAGE>
business as
prescribed
by the FDA,
or any other federal, state or
foreign agencies or bodies with jurisdiction over the activities
of the
Company or its Subsidiaries engaged in the regulation of
pharmaceuticals
or biohazardous
substances
or materials,
except where
noncompliance
would not, singly or in the aggregate, have a Material Adverse Effect.
All preclinical and
clinical studies
conducted by or on
behalf of the
Company or its Subsidiaries to support approval for
commercialization of
the Company's or its
Subsidiaries' products
have been conducted by the
Company or its
Subsidiaries, or to
the Company's
knowledge by third
parties, in compliance with all applicable federal, state,
provincial or
foreign laws, rules, orders and regulations, except for such failure or
failures to be in
compliance
as could not
reasonably
be expected to
have, singly or in the aggregate, a Material Adverse Effect.
(y)
The Company and each
of its Subsidiaries
has good and
marketable title in
fee simple
to, or have
valid rights to lease or
otherwise use, all items of real or personal property which are
material
to the business of the Company and its Subsidiaries, free and clear of
all liens, encumbrances, security interests, claims and
defects that do
not, singularly or in the aggregate, materially affect the value of
such
property and do not interfere with the use made and proposed to
be made
of such property by the Company or any of its Subsidiaries; and all of
the leases and subleases material to the business of the Company
and its
Subsidiaries, and
under which the
Company or any of its
Subsidiaries
holds properties
described in the
General Disclosure
Package and the
Prospectus, are in
full force and effect,
and neither the
Company nor
any Subsidiary has received any notice of any material claim of any
sort
that has been asserted by anyone adverse to the rights of the
Company or
any Subsidiary under any of the leases or subleases mentioned above, or
affecting or questioning the rights of the Company or such
Subsidiary to
the continued
possession of the leased or subleased premises under any
such lease or sublease.
(z)
No labor disturbance
by the employees of the Company or
any of its Subsidiaries exists or, to the best of the Company's
knowledge, is
imminent, and the Company is not aware of any existing or
imminent labor
disturbance
by the employees of any of its or its
Subsidiaries'
principal
suppliers,
manufacturers,
customers or
contractors, that
could reasonably
be expected,
singularly or in
the
aggregate, to have a
Material Adverse Effect. The Company is not aware
that any key employee or significant group of employees of the
Company
or any Subsidiary plans to terminate employment with the Company or
any
such
Subsidiary.
(aa) No
"prohibited
transaction" (as
defined in Section 406
of the Employee
Retirement Income
Security Act of 1974, as amended,
including the
regulations
and published interpretations thereunder
("ERISA"), or Section
4975 of the Internal
Revenue Code of 1986, as
amended from
time to time (the "CODE")) or "accumulated funding
deficiency" (as
defined in Section
302 of ERISA) or any
of the events
set forth
in Section 4043(b) of ERISA (other than events with respect to
which the thirty (30)-day notice requirement under Section 4043 of
ERISA
has been waived) has occurred or could reasonably be expected to occur
with respect to any
employee benefit plan
of the Company or any of its
Subsidiaries which
could, singularly or in the aggregate, have a
Material Adverse
Effect. Each employee
benefit plan of the
Company or
any of its
Subsidiaries is in compliance in all material respects with
applicable law,
including ERISA and the Code. The Company and its
Subsidiaries have not
incurred and could not
reasonably be expected to
incur liability under
Title IV of ERISA with respect to the termination
of, or withdrawal
from, any pension plan (as defined in
ERISA). Each
pension plan for which the Company or any of its Subsidiaries would
have
any liability that is
intended to be qualified under Section 401(a) of
the Code is so qualified, and nothing has occurred, whether by
action or
by failure to act, which could, singularly or in the aggregate, cause
the loss of such qualification.
(bb) The
Company and its
Subsidiaries are in compliance with
all foreign,
federal, state and local rules, laws and regulations
relating to the use,
treatment, storage and
disposal of
10
<PAGE>
hazardous or toxic
substances
or waste and
protection
of health and
safety or the
environment which
are applicable to their businesses
("ENVIRONMENTAL
LAWS"), except
where the failure to
comply would not,
singularly or in the aggregate, have a Material Adverse Effect. There
has been no storage, generation, transportation, handling, treatment,
disposal, discharge,
emission, or other release of any kind of toxic or
other wastes or other hazardous substances by, due to, or caused
by the
Company or any of its Subsidiaries (or, to the Company's knowledge,
any
other entity
for whose acts or omissions the Company or any of its
Subsidiaries is or may otherwise be liable) upon any of the
property now
or previously owned or leased by the Company or any of its
Subsidiaries,
or upon any other property, in violation of any law, statute,
ordinance,
rule, regulation,
order, judgment, decree or permit or which
would,
under any law, statute, ordinance, rule (including rule of
common law),
regulation, order,
judgment, decree or permit, give rise to any
liability, except for
any violation or liability which would not have,
singularly or in the aggregate with all such violations and
liabilities,
a Material Adverse
Effect; and there has
been no disposal,
discharge,
emission or other
release of any kind
onto such property
or into the
environment
surrounding such
property of any toxic
or other wastes or
other hazardous
substances
with respect to which the Company has
knowledge, except for any such disposal, discharge, emission, or other
release of any kind which would not have, singularly or in the
aggregate
with all such discharges and other releases, a Material Adverse Effect.
In the ordinary
course of business,
the Company and its
Subsidiaries
conduct periodic
reviews of the effect of Environmental Laws on their
business and assets,
in the course of which they identify and evaluate
associated costs and liabilities (including, without limitation, any
capital or operating
expenditures
required for
clean-up, closure of
properties or compliance with Environmental Laws or Governmental
Permits
issued thereunder, any
related constraints on operating activities and
any potential
liabilities
to third parties). On the basis of such
reviews, the Company and its Subsidiaries have reasonably concluded
that
such associated costs and liabilities would not have, singularly or in
the aggregate, a Material Adverse Effect.
(cc) The Company and its Subsidiaries, each (i) has timely
filed all necessary federal, state, local and foreign tax
returns, and
all such returns were
true, complete
and correct, (ii) has paid all
federal, state, local
and foreign taxes,
assessments,
governmental or
other charges due and payable for which it is liable, including,
without
limitation, all sales
and use taxes and all taxes which the Company or
any of its
subsidiaries is
obligated to withhold from amounts owing to
employees, creditors
and third parties, and (iii) does not have any tax
deficiency or claims
outstanding
or assessed or, to the best of its
knowledge, proposed
against any of them,
except those, in each
of the
cases described in
clauses (i), (ii) and (iii) of this PARAGRAPH (CC),
that would not, singularly or in the aggregate, have a Material Adverse
Effect. The Company
and its Subsidiaries,
each has not engaged
in any
transaction that could
reasonably be
characterized as a
corporate tax
shelter by the Internal Revenue Service or any other
taxing authority.
The accruals
and reserves on the books and records
of the Company and
its Subsidiaries
in respect of tax
liabilities for any
taxable period
not yet finally
determined are
adequate to meet any
assessments
and
related liabilities
for any such period,
and since July 31,
2006, the
Company and its
Subsidiaries each has
not incurred any
liability for
taxes other than in the ordinary course.
(dd) The
Company and each of its Subsidiaries carries, or is
covered by, insurance
provided by
recognized,
financially
sound and
reputable institutions
with policies in such
amounts and covering such
risks as is adequate for the conduct of their respective
businesses and
the value of their respective properties and as is customary for
companies engaged in
similar businesses
in similar industries. The
Company has no reason to believe that it or any Subsidiary will not be
able (i) to renew its
existing insurance coverage as and when such
policies expire
or (ii) to obtain
comparable
coverage from similar
institutions as may be
necessary or appropriate to conduct its business
as now conducted
and at a cost
that would not result in a Material
Adverse
11
<PAGE>
Effect. Neither the Company nor any of its Subsidiaries have been
denied
any insurance
coverage that they have sought or for which they have
applied.
(ee) The Company and its
Subsidiaries each maintains a system
of internal
accounting
and other 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 conformity with GAAP and to maintain accountability for assets;
(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 existing assets at reasonable
intervals and
appropriate action is
taken with respect to any differences. Except as
described in the
General Disclosure Package, since the end of the
Company's most recent audited fiscal year, there as been (A) no
material
weakness in the
Company's internal
control over
financial reporting
(whether or not remediated) and (B) no change in the Company's
internal
control over financial
reporting that has
materially affected,
or is
reasonably likely to materially affect, the Company's internal control
over financial
reporting.
(ff) The
minute books of the Company and each of its
Subsidiaries have been made available to the Placement Agent and
counsel
for the Placement Agent, and such books (i) contain a complete
summary,
in all material
respects, of all meetings and actions of the
board of
directors (including
each board
committee)
and shareholders of the
Company (or
analogous governing bodies and interest hol
