Exhibit 1.1
7,000,000
ANESIVA, INC.
Common Stock
PLACEMENT AGENT
AGREEMENT
November 21, 2006
Lazard Capital Markets
LLC
Needham & Company,
LLC
Rodman & Renshaw,
LLC
c/o Lazard
Capital Markets LLC
30 Rockefeller Plaza
New York, New York 10020
Dear Sirs:
1. I NTRODUCTION . Anesiva, Inc., a Delaware corporation (the
“ Company ”), proposes to issue and sell to the
purchasers, pursuant to the terms of this Placement Agent Agreement
(this “ Agreement ”) and the Subscription
Agreements in the form of Exhibit A attached hereto (the
“ Subscription Agreements ”) entered into with
the purchasers identified therein (each a “ Purchaser
” and collectively, the “ Purchasers ”),
up to an aggregate of 7,000,000 shares of common stock, $0.001 par
value per share (the “ Common Stock ”) of the
Company. The aggregate of 7,000,000 shares so proposed to be sold
is hereinafter referred to as the “ Stock .” The
Company hereby confirms its agreement with Lazard Capital Markets
LLC (“ LCM ”), Needham & Company, LLC
(“ Needham ”) and Rodman & Renshaw, LLC
(“ Rodman ,” and together with LCM and Needham,
the “ Placement Agents ”) to act as Placement
Agents in accordance with the terms and conditions hereof. LCM is
acting as the representative of the Placement Agents and in such
capacity is hereinafter referred to as the “
Representative .”
2. A GREEMENT TO A CT AS P LACEMENT A GENTS ; P LACEMENT OF S ECURITIES . 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 Agents to act as its exclusive agents 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 Representative, solicit or
accept offers to purchase Stock otherwise than through the
Placement Agents. LCM may utilize the expertise of Lazard
Frères & Co. LLC in connection with LCM’s
placement agent activities.
2.2 The Placement Agents agree, as
agents of the Company, to use their 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 Agents shall use commercially
reasonable efforts to assist the Company in obtaining performance
by each Purchaser whose offer to purchase Stock has been solicited
by the Placement Agents and accepted by the Company, but the
Placement Agents 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 any such
purchase is not consummated for any reason. Under no circumstances
will the Placement Agents be obligated to underwrite or purchase
any Stock for their own accounts and, in soliciting purchases of
Stock, the Placement Agents shall act solely as the Company’s
agents and not as principals. Notwithstanding the foregoing and
except as otherwise provided in Section 2.3 , it is
understood and agreed that the Placement Agents (or their
affiliates) may, solely at their discretion and without any
obligation to do so, purchase Stock as principals.
2.3 Subject to the provisions of
this Section 2 , offers for the purchase of Stock may
be solicited by the Placement Agents as agents for the Company at
such times and in such amounts as the Placement Agents deem
advisable. Each 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. Each 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
Purchasers at a price of $6.40 per share. The purchases of the
Stock by the Purchasers shall be evidenced by the execution of
Subscription Agreements by each of the Purchasers 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 (A) LCM and Needham by wire
transfer of immediately available funds to an account or accounts
designated by LCM, an aggregate amount equal to six percent
(6%) of the gross proceeds received by the Company from the
sale of the Stock on such Closing Date (such aggregate amount to be
divided between the Placement Agents pursuant to a prior existing
agreement between the LCM and Needham) and (B) Rodman by wire
transfer of immediately available funds to an account or accounts
designated by LCM, an amount of $50,000.
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 Agents
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. R EPRESENTATIONS AND W ARRANTIES OF THE C OMPANY . The Company represents and warrants to, and
agrees with, the Placement Agents and the Purchasers
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. 333-133337), which became effective as
of May 5, 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
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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 prospectus
supplement shall be provided to the Representative 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 Representative 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 any 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 any
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),
if any, issued prior to the Effective Time, 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 through the Representative by or on behalf of any Placement
Agent specifically for inclusion therein, which information the
parties hereto agree is limited to the Placement Agents’
Information (as defined in Section 18 ). As used in
this paragraph (b) and elsewhere in this
Agreement:
“ Applicable Time
” means 5:30 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 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.
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“ 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.
(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, if any, 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
through the Representative by or on behalf of any Placement Agent
specifically for inclusion therein, which information the parties
hereto agree is limited to the Placement Agents’ Information
(as defined in Section 18 ).
(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 through the Representative by or on behalf
of any Placement Agent specifically for inclusion therein, which
information the parties hereto agree is limited to the Placement
Agents’ Information (as defined in Section 18
).
(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 Representative 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
through the Representative by or on behalf of any Placement Agent
specifically for inclusion therein, which information the parties
hereto agree is limited to the Placement Agents’ Information
(as defined in Section 18 ).
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(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 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 Rules 163(b)(2) and 433(d) under the
Securities Act.
(h) The Company and each Subsidiary
(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 each of its
respective jurisdictions of organization. The Company and each
Subsidiary is duly qualified to do business and is in good standing
as foreign corporation or other legal entity in each jurisdiction
in which its ownership or lease of property or the conduct of its
business requires such qualification and has all power and
authority (corporate or other) necessary to own or hold its
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, business or prospects of
the Company and each Subsidiary, 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: AlgoRx Pharmaceuticals, Inc, a Delaware corporation and
AlgoRx Technologies, Inc., a Delaware corporation (each, a “
Subsidiary ,” and together, the “
Subsidiaries ”). Each Subsidiary is wholly-owned by
the Company.
(i) The Company has the full right,
power and authority to enter into this Agreement, each of the
Subscription Agreements and that certain Escrow Agreement (the
“ Escrow Agreement ”) dated as of the date
hereof by and among the Company, the Placement Agents and the
escrow agent named therein, and to perform and to discharge its
obligations hereunder and thereunder; and each of this Agreement
and each of the Subscription Agreements 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 Purchasers hereunder and under the
Subscription Agreements has been duly and validly authorized and,
when issued and delivered against payment therefor as provided
herein and the Subscription Agreements, 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.
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(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 November 14, 2006, there were 20,301,386 shares of Common
Stock issued and outstanding, no shares of Preferred Stock, par
value $0.001 of the Company issued and outstanding and 2,965,703
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 of the Company 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, the Subscription Agreements and the
Escrow 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 Subsidiary is a
party or by which the Company or any Subsidiary is bound or to
which any of the property or assets of the Company or any
Subsidiary 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
Subsidiary 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 Subsidiary 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
Nasdaq Global Market (“ Nasdaq GM ”) 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, the
Subscription Agreements and the Escrow 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 ”). Except as disclosed in the Registration
Statement and as pre-approved in accordance with the requirements
set forth in Section 10A of the Exchange Act, 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 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.
(q) Neither the Company nor any
Subsidiary 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 Subsidiary 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 the 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, including, without
limitation, any proceedings pending before the FDA, to which the
Company or any Subsidiary is a party or of which any property or
assets of the Company or any Subsidiary 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 and is not described therein, or which,
singularly or in the aggregate, if determined adversely to the
Company or any Subsidiary 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.
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(s) Neither the Company nor any
Subsidiary is not 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 Subsidiary
possess all certificates, authorizations and permits issued by the
appropriate federal, state or foreign regulatory authorities
necessary to conduct their businesses as described in the
Prospectus, except where the failure to possess such certificates,
authorizations and permits would not have a Material Adverse Effect
(collectively, the “ Governmental Permits ”),
including without limitation all such Governmental Permits required
by the United States Food and Drug Administration (the “
FDA ”) or any other federal, state or foreign agencies
or bodies engaged in the regulation of pharmaceuticals or
biohazardous materials, and the Company has not received any notice
of proceedings relating to the revocation or modification of any
Governmental Permit which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would
individually or in the aggregate have a Material Adverse Effect.
The studies, tests and preclinical and clinical trials conducted by
or on behalf of the Company and the Subsidiaries that are described
in the Registration Statement and the Prospectus were and, if still
pending, are being, conducted in compliance with all applicable
current Good Laboratory Practices and Good Clinical Practices in
all material respects; and the descriptions of the results of such
studies, tests and trials contained in the Registration Statement
and Prospectus are accurate in all material respects. Except as
described in the Prospectus, the Company has not received any
notices or correspondence from the FDA or other governmental agency
requiring the termination, suspension or material modification of
any clinical trials conducted by, or on behalf, of the Company or
in which the Company has participated that are described in the
Prospectus.
(u) Neither the Company nor any
Subsidiary is or, after giving effect to the Offering 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, the
Subsidiaries nor, to the Company’s knowledge, any of the
Company’s or the 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 the 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 described in the
General Disclosure Package and the Prospectus, and the Company is
not aware
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of any claim to the contrary or any
challenge by any other person to the rights of the Company and the
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, to the knowledge of the Company, valid, binding
upon, and enforceable by or against the parties thereto in
accordance to its terms. The Company and each Subsidiary has
complied in all material respects with, and is not in breach nor
has 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
Subsidiary’s businesses as now conducted and as proposed to
be conducted, to the knowledge of the Company, do not and will not
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. The company
has not received notice of any material claim against the Company
or any Subsidiary alleging the infringement by the Company or any
of its Subsidiary 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 Subsidiary has 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 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 Subsidiary’s 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 Subsidiary has duly and properly filed or caused to be filed
with the United States Patent and Trademark Office (the “
PTO ”) and applicable foreign and international patent
authorities all patent applications owned by the Company and the
Subsidiaries (the “ Company Patent Applications
”). To the knowledge of the Company, the Company and each
Subsidiary has complied with the PTO’s duty of candor and
disclosure for the Company Patent Applications and has made no
material misrepresentation in the Company Patent Applications. The
Company is not aware of any information material to a determination
of patentability regarding the Company Patent Applications not
called to the attention of the PTO or similar foreign authority.
The Company is not aware of any information not called to the
attention of the PTO or similar foreign authority that would
preclude the grant of a patent for the Company Patent Applications.
The Company has no knowledge of any information that would preclude
the Company, or as applicable, any Subsidiary, from having clear
title to the Company Patent Applications.
(x) The Company and each Subsidiary
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 the
Subsidiaries, in each case 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 the Subsidiaries;
and all of the leases and subleases material to the business of the
Company and under which the Company 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.
(y) No labor disturbance by the
employees of the Company or any Subsidiary 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 the Subsidiaries’ principal
suppliers, manufacturers, customers or contractors, that could
reasonably be expected, singularly
9
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
Subsidiary.
(z) 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 Subsidiary which could,
singularly or in the aggregate, have a Material Adverse Effect.
Each employee benefit plan of the Company or any Subsidiary is in
compliance in all material respects with applicable law, including
ERISA and the Code. The Company and the Subsidiary 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 Subsidiary 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.
(aa) 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 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 Subsidiaries (or, to the
Company’s knowledge, any other entity for whose acts or
omissions the Company or any of the Subsidiaries is or may
otherwise be liable) upon any of the property now or previously
owned or leased by the Company or any of the 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.
(bb) The Company and each
Subsidiary, 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 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 (bb) , that would not,
singularly or in the aggregate, have a Material Adverse Effect. The
Company and each Subsidiary has not engaged in any transaction
which is a corporate tax shelter or which could be characterized as
such by the Internal Revenue Service or any other taxing authority.
The accruals
10
and reserves on the books and
records of the Company and the 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 December 31, 2005, the Company and each
Subsidiary has not incurred any liability for taxes other than in
the ordinary course.
(cc) The Company and each Subsidiary
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 Effect. Neither the Company nor any Subsidiary has
been denied any insurance coverage that each sought or for which it
has applied.
(dd) The Company and each Subsidiary
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.
(ee) The minute books of the Company
and each Subsidiary have been made available to the Placement
Agents and counsel for the Placement Agents, and such books
(i) contain a complete summary 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 holders, as applicable), and each Subsidiary since the
time of its respective incorporation or organization through the
date of the latest meeting and action, and (ii) accurately in
all material respects reflect all transactions referred to in such
minutes.
(ff) There is no franchise, lease,
contract, agreement or document required by the Securities Act or
by the Rules and Regulations to be described in the General
Disclosure Package and in the Prospectus or a document incorporated
by reference therein or to be filed as an exhibit to the
Registration Statement or a document incorporated by reference
therein which is not described or filed therein as required; and
all descriptions of any such franchises, leases, contracts,
agreements or documents contained in the Registration Statement or
in a document incorporated by reference therein are accurate and
complete descriptions of such documents in all material respects.
Other than as described in the General Disclosure Package, no such
franchise, lease, contract or agreement has been suspended or
terminated for convenience or default by the Company or any
Subsidiary or any of the other parties thereto, and neither the
Company nor any Subsidiary has received notice nor does the Company
have any other knowledge of any such pending or threatened
suspension or termination, except for such pending or threatened
suspensions or terminations that would not reasonably be expected
to, singularly or in the aggregate, have a Material Adverse
Effect.
(gg) No relationship, direct or
indirect, exists between or among the Company and any Subsidiary on
the one hand, and the directors, officers, stockholders (or
analogous interest
11
holders), customers or suppliers of
the Company or any Subsidiary or any of their affiliates on the
other hand, which is required to be described in the General
Disclosure Package and the Prospectus or a document incorporated by
reference therein and which is not so described.
(hh) No person or entity has the
right to require registration of shares of Common Stock or other
securities of the Company or any Subsidiary because of the filing
or effectiveness of the Registration Statement or otherwise, except
for persons and entities who have expressly waived such right in
writing or who have been given timely and proper written notice and
have failed to exercise such right within the time or times
required under the terms and conditions of such right. Except as
described in the General Disclosure Package, there are no persons
with registration rights or similar rights to have any securities
registered by the Company or any Subsidiary under the Securities
Act.
(ii) Neither the Company nor any
Subsidiary owns any “margin securities” as that term is
defined in Regulation U of the Board of Governors of the Federal
Reserve System (the “ Federal Reserve Board ”),
and none of the proceeds of the sale of the Stock will be used,
directly or indirectly, for the purpose of purchasing or carrying
any margin security, for the purpose of reducing or retiring any
indebtedness which was originally incurred to purchase or carry any
margin security or for any other purpose which might cause any of
the Stock to be considered a “purpose credit” within
the meanings of Regulation T, U or X of the Federal Reserve
Board.
(jj) Neither the Company nor any
Subsidiary is a party to any contract, agreement or understanding
(other than this Agreement) with any person that would give rise to
a valid claim against the Company or the Placement Agents for a
brokerage commission, finder’s fee or like payment in
connection with the offering and sale of the Stock or any
transaction contemplated by this Agreement, the Registration
Statement, the General Disclosure Package or the
Prospectus.
(kk) No forward-looking statement
(within the meaning of Section 27A of the Securities Act and
Section 21E of the Exchange Act) contained in either the
General Disclosure Package or the Prospectus has been made or
reaffirmed without a reasonable basis or has been disclosed other
than in good faith.
(ll) None of the Company nor any
Subsidiary does business with the government of Cuba or with any
person or affiliate located in Cuba within the meaning of Florida
Statutes Section 517.075.
(mm) The Company is subject to and
in compliance in all material respects with the reporting
requirements of Section 13 or Section 15(d) of the
Exchange Act. The Common Stock is registered pursuant to
Section 12(g) of the Exchange Act and is listed on the Nasdaq
GM, and the Company has taken no action designed to, or reasonably
likely to have the effect of, terminating the registration of the
Common Stock under the Exchange Act or delisting the Common Stock
from the Nasdaq GM, nor has the Company received any notification
that the Commission or the National Association of Securities
Dealers, Inc. (“ NASD ”) is contemplating
terminating such registration or listing. No consent, approval,
authorization or order of, or filing, notification or registration
with, the Nasdaq GM is required for the listing and trading of the
Stock on the Nasdaq GM.
(nn) The Company is in compliance
with all applicable provisions of the Sarbanes-Oxley Act of 2002
and all rules and regulations promulgated thereunder or
implementing the provisions thereof (the “ Sarbanes-Oxley
Act ”) that are then in effect and is actively taking
steps to ensure that it will be in compliance with other applicable
provisions of the Sarbanes-Oxley Act not currently in effect upon
and at all times after the effectiveness of such
provisions.
(oo) The Company is in compliance
with all applicable corporate governance requirements set forth in
the Nasdaq Marketplace Rules that are then in effect and is
actively
12
taking steps to ensure that it will
be in compliance with other applicable corporate governance
requirements set forth in the Nasdaq Marketplace Rules not
currently in effect upon and all times after the effectiveness of
such requirements.
(pp) Neither the Company nor any
Subsidiary nor, to the best of the Company’s knowledge, any
employee or agent of the Company or any Subsidiary, has made any
contribution or other payment to any official of, or candidate for,
any federal, state, local or foreign office in violation of any law
(including the Foreign Corrupt Practices Act of 1977, as amended)
or of the character required to be disclosed in the Registration
Statement, the General Disclosure Package or the Prospectus or a
document incorporated by reference therein.
(qq) There are no transactions,
arrangements or other relationships between and/or among the
Company, any of its affiliates (as such term is defined in Rule 405
of the Securities Act) and any unconsolidated entity, including,
but not limited to, any structure finance, special purpose or
limited purpose entity that could reasonably be expected to
materially affect the Company’s or any Subsidiary’s
liquidity or the availability of or requirements for their capital
resources required to be described in the General Disclosure
Package and the Prospectus or a document incorporated by reference
therein which have not been described as required.
(rr) There are no outstanding loans,
advances (except normal advances for business expenses in the
ordinary course of business) or guarantees or indebtedness by the
Company or any Subsidiary to or for the benefit of any of the
officers or directors of the Company, any Subsidiary or any of
their respective family members, except as disclosed in the
Registration Statement, the General Disclosure Package and the
Prospectus.
(ss) The statistical and market
related data included in the Registration Statement, the General
Disclosure Package and the Prospectus are based on or derived from
sources that the Company believes to be reliable and accurate, and
such data agree with the sources from which they are
derived.
(tt) The operations of the Company
and the Subsidiaries are and have been conducted at all times in
compliance with applicable financial recordkeeping and reporting
requirements of the Currency and Foreign Transactions Reporting Act
of 1970, as amended, applicable money laundering statutes and
applicable rules and regulations thereunder (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 or any
Subsidiary with respect to the Money Laundering Laws is pending, or
to the best knowledge of the Company, threatened.
(uu) Neither the Company nor any
Subsidiary nor, to the knowledge of the Company, any director,
officer, agent, employee or affiliate of the Company or any
Subsidiary 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.
(vv) Neither the Company nor any
subsidiary nor any of their affiliates (within the meaning of NASD
Conduct Rule 2720(b)(1)(a)) directly or indirectly controls, is
controlled by, or is under common control with, or is an associated
person (within the meaning of Article I, Section 1(ee) of the
By-laws of the NASD) of, any member firm of the NASD.
(ww) No approval of the shareholders
of the Company under the rules and regulations of Nasdaq (including
Rule 4350 of the Nasdaq Global Marketplace Rules), and no approval
of the shareholders of the Company thereunder is required for the
Company to issue and deliver to the Purchasers the Stock, including
such as may be required pursuant to Rule 4350 of the Nasdaq Global
Marketplace Rules.
13
Any certificate signed by or on behalf of the
Company and delivered to any Placement Agent or to counsel for the
Placement Agents shall be deemed to be a representation and
warranty by the Company to the Placement Agents and the Purchasers
as to the matters covered thereby.
4. T HE C LOSING . The time and date of closing and delivery of
the documents required to be delivered to the Placement Agents
pursuant to Sections 5 and 7 hereof shall be at 10:00
A.M., New York time, on November 28, 2006 (the “Closing
Date”) at the office of Cooley Godward Kronish LLP located at
3175 Hanover Street, Palo Alto, California.
5. FURTHER AGREEMENTS OF THE
COMPANY . The Company agrees with the Placement Agents and the
Purchasers:
(a) To prepare the Rule 462(b)
Registration Statement, if necessary, in a form approved by the
Representative and file such Rule 462(b) Registration Statement
with the Commission on the date hereof; to prepare the Prospectus
in a form approved by the Representative containing information
previously omitted at the time of effectiveness of the Registration
Statement in reliance on rules 430A, 430B and 430C and to file such
Prospectus pursuant to Rule 424(b) under the Securities Act
not later than the second business (2 nd ) day following the execution
and delivery of this Agreement or, if applicable, such earlier time
as may be required by Rule 430A of the Rules and Regulations; to
notify the Representative immediately of the Company’s
intention to file or prepare any supplement or amendment to any
Registration Statement or to the Prospectus and to make no
amendment or supplement to the Registration Statement, the General
Disclosure Package or to the Prospectus to which the Representative
shall reasonably object by notice to the Company after a reasonable
period to review; to advise the Representative, promptly after it
receives notice thereof, of the time when any amendment to any
Registration Statement has been filed or becomes effective or any
supplement to the General Disclosure Package or the Prospectus or
any amended Prospectus has been filed and to furnish the
Representative copies thereof; to file promptly all material
required to be filed by the Company with the Commission pursuant to
Rule 433(d) or 163(b)(2), as the case may be; to file promptly all
reports and any definitive proxy or information statements required
to be filed by the Company with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act
subsequent to the date of the Prospectus and for so long as the
delivery of a prospectus (or in lieu thereof, the notice referred
to in Rule 173(a) under the Securities Act) is required in
connection with the offering or sale of the Stock; to advise the
Representative, promptly after it receives notice thereof, of the
issuance by the Commission of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus, any
Issuer Free Writing Prospectus or the Prospectus, of the suspension
of the qualification of the Stock for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding
for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement, the
General Disclosure Package or the Prospectus or for additional
information; and, in the event of the issuance of any stop order or
of any order preventing or suspending the use of any Preliminary
Prospectus, any Issuer Free Writing Prospectus or the Prospectus or
suspending any such qualification, and promptly to use its best
efforts to obtain the withdrawal of such order.
(b) The Company represents and
agrees that, unless it obtains the prior consent of the
Representative, and each Placement Agent represents and agrees
that, unless it obtains the prior consent of the Representative and
the Company, it has not made and will not, make any offer relating
to the Stock that would constitute a “free writing
prospectus” as defined in Rule 405 under the Securities Act
unless the prior written consent of the Representative has been
received (each, a “ Permitted Free Writing Prospectus
”); provided that the prior written consent of the
Representative hereto shall be deemed to have been given in respect
of the Issuer Free Writing
14
Prospectus included in Schedule
A hereto. The Company represents that it has treated and agrees
that it will treat each Permitted Free Writing Prospectus as an
Issuer Free Writing Prospectus, comply with the requirements of
Rules 164 and 433 under the Securities Act applicable to any Issuer
Free Writing Prospectus, including the requirements relating to
timely filing with the Commission, legending and record keeping and
will not take any action that would result in any Placement Agent
or the Company being required to file with the Commission pursuant
to Rule 433(d) under the Securities Act a free writing prospectus
prepared by or on behalf of such Placement Agent that such
Placement Agent ot
