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Exhibit 5.1
828,571 SHARES
HALOZYME THERAPEUTICS, INC.
SHARES OF COMMON STOCK
($0.001 PAR VALUE)
PLACEMENT AGENT AGREEMENT
December 13, 2005
SG COWEN & CO., LLC
RODMAN & RENSHAW, LLC
ROTH CAPITAL PARTNERS, LLC
c/o SG Cowen & Co., LLC
1221 Avenue of the Americas
New York, New York 10020
Dear Sirs:
Halozyme
Therapeutics, Inc., a Nevada corporation (the "COMPANY"),
proposes to 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"), an aggregate of 828,571
shares of Common Stock, $0.001 par value
(the "COMMON STOCK"), of the Company. The
aggregate of 828,571 shares so
proposed to be sold is hereinafter referred
to as the "STOCK." The Company
hereby confirms its agreement with the
placement agents named on Schedule I
attached hereto (the "PLACEMENT AGENTS"),
as set forth below. SG Cowen & Co.,
LLC is acting as the representative of the
Placement Agents and in such capacity
is hereinafter referred to as the
"REPRESENTATIVE." Certain terms used herein
are defined in Section 14 hereof.
1. AGREEMENT TO ACT AS PLACEMENT AGENTS;
PLACEMENT OF SECURITIES. On the basis
of the representations, warranties and
agreements of the Company and its
Subsidiary (as defined below) herein
contained, and subject to all the terms and
conditions of this Agreement:
(a) 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 3
hereof),
the Company shall not, without the prior consent of the
Representative, solicit or accept offers to purchase the Stock
otherwise
than
through the Placement Agents.
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(b) 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 Base
Prospectus (as defined below) and the Prospectus Supplement (as
defined
below). The Placement Agents shall make 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 purchase
any Stock
for its
own account and, in soliciting purchases of Stock, the
Placement
Agents
shall act solely as the Company's agent and not as principals.
Notwithstanding the foregoing and except as otherwise provided in
Section
1(c), 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.
(c)
Subject to the provisions of this Section 1, 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.
(d) The
purchases of the Stock by the Purchasers shall be evidenced by
the
execution
of the Subscription Agreements by each of the parties thereto.
(e) As
compensation for services rendered, on the Closing Date the
Company
shall pay
to the Placement Agents by wire transfer of immediately
available
funds to an account or accounts designated by the
Representative, an amount equal to seven percent (7%) of the
gross
proceeds
received by the Company from the sale of the Stock on such
Closing
Date.
(f) 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 or damage arising from or as a result
of
such
default by the Company.
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2. REPRESENTATIONS AND WARRANTIES OF THE
COMPANY AND ITS SUBSIDIARY. The Company
and its Subsidiary represent and warrant
to, and agrees with, the several
Placement Agents and the Purchasers
that:
(a) The
Company meets the requirements for use of Form S-3 under the
Securities
Act of 1933, as amended (the "SECURITIES ACT"), and has filed
with the
Securities and Exchange Commission (the "COMMISSION") a
registration statement on such form (Registration File No.
333-125731),
which
became effective as of June 17, 2005, for the registration under
the
Securities
Act of the Stock. Such registration statement meets the
requirements set forth in Rule 415(a)(1)(x) under the Securities
Act and
complies
with said Rule. The Company will file with the Commission
pursuant
to Rule 424(b) under the Securities Act, and the rules and
regulations (the "RULES AND REGULATIONS") of the Commission
promulgated
thereunder, a supplement to the form of prospectus included in
such
registration statement relating to the placement of the Stock and
the plan
of
distribution thereof and has advised the Representative of all
further
information (financial and other) with respect to the Company
required to
be set
forth therein. Such registration statement, including the
exhibits
thereto,
as amended at the date of this Agreement, is hereinafter called
the
"REGISTRATION STATEMENT"; such prospectus in the form in which
it
appears in
the Registration Statement is hereinafter called the "BASE
PROSPECTUS"; and the supplemented form of prospectus, in the form
in which
it will be
filed with the Commission pursuant to Rule 424(b) (including
the Base
Prospectus as so supplemented) is hereinafter called the
"PROSPECTUS SUPPLEMENT." Any reference herein to the
Registration
Statement,
the Base Prospectus or the Prospectus Supplement shall be
deemed to
refer to and include the documents incorporated by reference
therein,
including all exhibits thereto (the "INCORPORATED DOCUMENTS")
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
date of
this Agreement, or the issue date of the Base Prospectus or the
Prospectus
Supplement, as the case may be; and any reference herein to the
terms
"amend," "amendment" or "supplement" with respect to the
Registration Statement, the Base Prospectus or the Prospectus
Supplement
shall be
deemed to refer to and include the filing of any document under
the
Exchange Act after the date of this Agreement, or the issue date
of
the Base
Prospectus or the Prospectus Supplement, as the case may be,
deemed to
be incorporated therein by reference. All references in this
Agreement
to financial statements and schedules and other information
which is
"contained," "included," "described," "set forth" or "stated"
in
the
Registration Statement, the Base Prospectus or the Prospectus
Supplement
(and all other references of like import) shall be deemed to
mean and
include all such financial statements and schedules and other
information which is or is deemed to be incorporated by reference
in the
Registration Statement, the Base Prospectus or the Prospectus
Supplement,
as the
case may be. No stop order suspending the effectiveness of the
Registration Statement or the use of the Base Prospectus or the
Prospectus
Supplement
has been issued, and no proceeding for any such purpose is
pending or
has been initiated or, to the Company's knowledge, is
threatened by the
Commission. For purposes of this Agreement, "FREE
WRITING
PROSPECTUS" has the meaning set forth in Rule 405 under the
Securities
Act and the "TIME OF SALE PROSPECTUS" means the
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preliminary prospectus, if any, together with the free writing
prospectuses, if any, used in connection with the Offering,
including any
documents,
incorporated by reference therein.
(b) The
Registration Statement (and any further documents to be filed
with
the
Commission) contains all exhibits and schedules as required by
the
Securities
Act. Each of the Registration Statement and any post-effective
amendment
thereto, at the time it became effective, complied in all
material
respects with the Securities Act and the Exchange Act and the
applicable
Rules and Regulations and did not and, as amended or
supplemented, if applicable, will not, contain any untrue statement
of a
material
fact or omit to state a material fact required to be stated
therein or
necessary to make the statements therein not misleading. The
Base
Prospectus, the Time of Sale Prospectus, if any, and the
Prospectus
Supplement, each as of its respective date, comply in all
material
respects
with the Securities Act and the Exchange Act and the applicable
Rules and
Regulations. Each of the Base Prospectus, the Time of Sale
Prospectus, if any, and the Prospectus Supplement, as amended
or
supplemented, did not and will not contain as of the date thereof
any
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. The
Incorporated
Documents,
when they were filed with the Commission, conformed in all
material
respects to the requirements of the Exchange Act and the
applicable
Rules and Regulations, and none of such documents, when they
were filed
with the Commission, contained any untrue statement of a
material
fact or omitted to state a material fact necessary to make the
statements
therein not misleading; and any further documents so filed and
incorporated by reference in the Base Prospectus, the Time of
Sale
Prospectus, if any, or Prospectus Supplement, when such documents
are
filed with
the Commission, will conform in all material respects to the
requirements of the Exchange Act and the applicable Rules and
Regulations,
as
applicable, and will not contain any untrue statement of a
material
fact or
omit to state a material fact necessary to make the statements
therein
not misleading. Notwithstanding the foregoing, the Company
makes
no
representations or warranties as to information, if any, contained
in
or omitted
from the Time of Sale Prospectus, if any, or the Prospectus
Supplement
or any amendment thereof or supplement thereto in reliance upon
and in
conformity with information furnished in writing to the Company
by
or on
behalf of any Placement Agent specifically for use in the
Registration Statement, the Time of Sale Prospectus, if any, or
the
Prospectus
Supplement, which information the parties hereto agree is
limited to
the Placement Agents' Information as defined in Section 16. No
post-effective amendment to the Registration Statement reflecting
any
facts or
events arising after the date thereof which represent,
individually or in the aggregate, a fundamental change in the
information
set forth
therein is required to be filed with the Commission. There are
no
documents required to be filed with the Commission in connection
with
the
transaction contemplated hereby that (x) have not been filed as
required
pursuant to the Securities Act or (y) will not be filed within
the
requisite time period. There are no contracts or other
documents
required
to be described in the Base Prospectus, the Time of Sale
Prospectus, if any, or Prospectus Supplement, or to be filed as
exhibits
or
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schedules
to the Registration Statement, which have not been described or
filed as
required.
(c) The
Company is eligible to use free writing prospectuses in
connection
with the
Offering pursuant to Rules 164 and 433 under the Securities
Act.
Any free
writing prospectus that the Company is required to file
pursuant
to Rule
433(d) under the Securities Act has been, or will be, filed
with
the
Commission in accordance with the requirements of the Securities
Act
and the
applicable rules and regulations of the Commission thereunder.
Each free
writing prospectus that the Company has filed, or is required
to
file,
pursuant to Rule 433(d) under the Securities Act or that was
prepared
by or behalf of or used by the Company complies or will comply
in
all
material respects with the requirements of the Securities Act and
the
applicable
rules and regulations of the Commission thereunder. The Company
will not,
without the Representative's consent, prepare, use or refer to,
any free
writing prospectus.
(d) The
Company has delivered, or will as promptly as practicable
deliver,
to the
Representative complete conformed copies of the Registration
Statement
and of each consent and certificate of experts filed as a part
thereof,
and conformed copies of the Registration Statement (without
exhibits)
and the Base Prospectus, the Time of Sale Prospectus, if any,
and the
Prospectus Supplement, as amended or supplemented, in such
quantities
and at such places as the Representative reasonably requests.
Neither
the Company nor any of its directors and officers has
distributed
and none
of them will distribute, prior to the completion of the
distribution of Stock, any offering material in connection with
the
offering
and sale of the Stock other than the Base Prospectus, the Time
of
Sale
Prospectus, if any, the Prospectus Supplement, the Registration
Statement,
copies of the documents incorporated by reference therein and
any other
materials permitted by the Securities Act.
(e) Each
of the Company and Halozyme, Inc., a wholly-owned subsidiary of
the
Company (the "SUBSIDIARY"), have been duly organized and are
validly
existing
as corporations or other legal entities in good standing (or
the
equivalent
thereof, if any) under the laws of their respective
jurisdictions of incorporation, are duly qualified to do business
and are
in good
standing (or the equivalent thereof, if any) as foreign
corporations in each jurisdiction in which their respective
ownership or
lease of
property or the conduct of their respective businesses requires
such
qualification, and have all power and authority necessary to own
or
hold their
respective properties and to conduct the businesses in which
they are
engaged, except where the failure to be so qualified and in
good
standing
or have such power or authority would not have, singularly or
in
the
aggregate, a material adverse effect on the condition (financial
or
otherwise), results of operations, business, properties or
prospects of
the
Company and its Subsidiary taken as a whole (a "MATERIAL
ADVERSE
EFFECT").
(f) The
Stock to be issued and sold by the Company hereunder and under
the
Subscription Agreements has been duly and validly authorized and,
when
issued and
delivered against payment therefor as provided herein, will be
duly and
validly issued, fully paid and nonassessable and free of any
preemptive
or
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similar
rights. The Stock conforms to the description thereof contained
in
the Base
Prospectus, the Prospectus Supplement and the Time of Sale
Prospectus, if any.
(g) The
Company has an authorized capitalization as set forth in the
Base
Prospectus, the Prospectus Supplement and the Time of Sale
Prospectus, if
any, all
of the issued and outstanding 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
Base
Prospectus, the Prospectus Supplement and the Time of Sale
Prospectus, if any. 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 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 that have been granted by the
Company
other than: (i) those accurately described in the Base
Prospectus
or ii)
those issued pursuant to existing stock option plans. 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 Base Prospectus, completely, accurately and
fairly
present
the information required to be shown with respect to such
plans,
arrangements, options and rights.
(h) All
the outstanding shares of capital stock of the Subsidiary have
been duly
authorized and validly issued, are fully paid and
non-assessable
and,
except to the extent set forth in the Base Prospectus, are
owned
directly
by the Company, free and clear of any claim, lien, encumbrance,
security
interest, defect or restriction upon voting or transfer or any
other
claim of any kind ("LIENS").
(i) The
Company has the full right, power and authority to enter into
this
Agreement
and each of the Subscription Agreements 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,
except as limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors'
and
contracting parties' rights generally and except as enforceability
may be
subject to
general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law)
and
except as
the indemnification agreements of the Company herein may be
legally
unenforceable.
(j) The
execution, delivery and performance of this Agreement and the
Subscription Agreements by the Company and the consummation of
the
transactions contemplated hereby and thereby will not conflict with
or
result in
a breach or violation of any of the terms or provisions of, or
constitute
a default under, any indenture, mortgage, deed of trust, loan
agreement
or other
6
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agreement
or instrument to which the Company or its Subsidiary is a party
or by
which the Company or its Subsidiary is bound or to which any of
the
property
or assets of the Company or its Subsidiary is subject, except
any
such
conflicts, breaches or violations which would not reasonably be
expected
to have a Material Adverse Effect, nor will such actions result
in any
violation of the provisions of the charter or bylaws of the
Company
or its
Subsidiary or any statute, law, rule or regulation or any
judgment,
order or
decree of any court or governmental agency or body having
jurisdiction over the Company or its Subsidiary or any of their
properties
or
assets.
(k) There
is no franchise, contract, lease, instrument or other document
of a
character required by the Securities Act or the Rules and
Regulations
to be
described in the Base Prospectus or the Prospectus Supplement, or
to
be filed
as an exhibit to the Registration Statement, which is not
described
or filed as required; and all statements summarizing any such
franchises, contracts, leases, instruments or other documents or
legal
matters
contained in the Registration Statement are accurate and
complete
in all
material respects, except as redacted pursuant to confidential
treatment
requests. Other than as described in the Base Prospectus, no
such
franchise, contract, lease, instrument or other document has
been
suspended
or terminated for convenience or default by the Company or its
Subsidiary
or any of the other parties thereto, neither the Company or its
Subsidiary
has sent or received any communication regarding intent not to
renew any
such franchise, contract, lease, instrument or other document,
and
neither the Company nor its Subsidiary has received notice or
any
other
knowledge of any such pending or threatened suspension,
termination
or
non-renewal, except for such pending or threatened suspensions,
terminations or non-renewals that would not reasonably be expected
to,
singularly
or in the aggregate, have a Material Adverse Effect.
(l) All
existing minute books of the Company and its Subsidiary,
including
all
existing records of all meetings and actions of the board of
directors
(including, Audit, Compensation, Nominating and Governance and
other board
committees) and stockholders of the Company through the date of the
latest
meeting
and action (collectively, the "CORPORATE RECORDS") have been
made
available
to the Placement Agents and counsel for the Placement Agents.
All such
Corporate Records are complete and accurately reflect, in all
material
respects, all transactions referred to in such Corporate
Records.
There are
no material transactions, agreements or other actions of the
Company or
its Subsidiary that are not properly approved and/or recorded
in the
Corporate Records.
(m) No
consent, approval, authorization, filing with or order of or
registration with, any court or governmental agency or body is
required in
connection
with the transactions contemplated herein or in the
Subscription Agreements, except such as have been obtained or made
(or
will be
timely obtained or made) under the Securities Act or the
Exchange
Act and
such as may be required under the securities, or blue sky, laws
of
any
jurisdiction in connection with the offer and sale of the Stock by
the
Company in
the manner contemplated herein and in the Base Prospectus and
the
Prospectus Supplement.
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(n) Except
as described in the Base Prospectus, (i) no person has the
right,
contractual or otherwise, to cause the Company to issue or sell
to
it any
shares of Common Stock or shares of any other capital stock or
other
equity interests of the Company, (ii) no person has any
preemptive
rights,
resale rights, rights of first refusal or other rights to
purchase
from the
Company any shares of Common Stock or shares of any other
capital
stock or
other securities of the Company, and (iii) except as provided
herein, no
person has the right to act as an underwriter, placement agent
or
financial advisor to the Company in connection with and as a result
of
the offer
and sale of the Stock, in the case of each of the foregoing
clauses
(i), (ii) and (iii), whether as a result of the filing or
effectiveness of the Registration Statement or the sale of the
Stock as
contemplated thereby or otherwise; no person has the right,
contractual or
otherwise,
to cause the Company to register under the Securities Act any
shares of
Common Stock or shares of any other capital stock or other
securities
of the Company, or to include any such shares or interests in
the
Registration Statement or the offering contemplated thereby,
whether
as a
result of the filing or effectiveness of the Registration
Statement
or the
sale of the Stock as contemplated thereby or otherwise, except
for
persons
and entities who have had their shares already registered under
the
Securities Act, who have expressly waived such right or who have
been
given
timely and proper notice and have failed to exercise such right
within the
time or times required under the terms and conditions of such
right, and
the Company is not required to file any registration statement
for the
registration of any securities of any person or register any
such
securities
pursuant to any other registration statement filed by the
Company
under the Securities Act for a period of at least 180 days
after
the date
hereof.
(o) The
financial statements, together with the related notes and
schedules,
of the Company included in the Base Prospectus, the Prospectus
Supplement
or the Registration Statement, the Time of Sale Prospectus, if
any, or
incorporated by reference therein, as the case may be, present
fairly the
financial condition, results of operations and cash flows of
the
Company and its consolidated subsidiary as of the dates and for
the
periods
indicated, comply in all material respects with the Securities
Act
and the
Rules and Regulations thereunder, and have been prepared in
conformity
with generally accepted accounting principles applied on a
consistent
basis throughout the periods involved; provided, however, that
statements
that are unaudited are subject to year-end adjustments and do
not
contain notes required under generally accepted accounting
principles.
No other
financial statements or supporting schedules or exhibits are
required
by the Securities Act or the Rules and Regulations thereunder
to
be
included in the Base Prospectus, the Prospectus Supplement or
the
Registration Statement, the Time of Sale Prospectus, if any, or
incorporated by reference therein, as the case may be.
(p) Except
as set forth in the Base Prospectus, there is no legal or
governmental proceeding pending to which the Company or its
Subsidiary is
a party or
of which any property or assets of the Company or its
Subsidiary
is the subject which is required to be described in the Base
Prospectus, and is not described therein, or which, singularly or
in the
aggregate,
if determined adversely to the Company or its Subsidiary, might
have a
Material Adverse
8
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Effect or
would prevent or adversely affect the ability of the Company or
its
Subsidiary to perform its obligations under this Agreement; and to
the
best of
the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by
others.
(q) The
Company and its Subsidiary have good and marketable title to
all
property (real and personal)
described in the Registration Statement, the
Base
Prospectus and the Prospectus Supplement and the Time of Sale
Prospectus, if any as being owned by the Company or its Subsidiary,
free
and clear
of any Liens, except for those Liens that do not materially
interfere
with the use made or proposed to be made of such property by
the
Company or
its Subsidiary or that would not have a Material Adverse
Effect;
all the property described in the Registration Statement, the
Base
Prospectus
the Time of Sale Prospectus, if any, and the Prospectus
Supplement
as being held under lease by the Company or its Subsidiary is
held
thereby under valid, subsisting and enforceable leases except
where
the
failure to be valid, subsisting or enforceable would not have a
Material
Adverse Effect.
(r)
Neither the Company nor its Subsidiary is (i) in violation of
any
provision
of its charter or bylaws, (ii) in 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 of any indenture, contract, lease,
mortgage,
deed of
trust, note agreement, loan agreement or other agreement,
obligation, condition, covenant 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) in
violation in any respect of any statute, law, rule, regulation,
ordinance,
judgment, order or decree of any court, regulatory body,
administrative agency, governmental body, arbitrator or other
authority
having
jurisdiction over the Company or its Subsidiary, or any of
their
properties, as applicable (including, without limitation, those
administered by the Food and Drug Administration of the U.S.
Department of
Health and
Human Services (the "FDA") or by any foreign, federal, state or
local
governmental or regulatory authority performing functions similar
to
those
performed by the FDA), except, with respect to clauses (ii) and
(iii), any
violations or defaults which, singularly or in the aggregate,
would not
have a Material Adverse Effect.
(s) The
contracts described in the Company's regular reports on Forms
10-Q,
10-K, and 8-K as filed by the Company with the Commission or
incorporated by reference therein that are material to the Company
are in
full force and effect on the date
hereof, and neither the Company nor, to
the
Company's knowledge, any other party to such contracts is in breach
of
or default
under any of such contracts which would have a Material Adverse
Effect.
(t) No labor problem or
dispute with the employees of the Company or its
Subsidiary
exists or, to the Company's knowledge, is threatened or
imminent,
which might be expected to have a Material Adverse Effect.
Neither
the Company nor its Subsidiary is aware that any key employee
of
the
Company or its Subsidiary or significant group of employees of
the
Company or
its
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Subsidiary
plans to terminate employment with the Company or its
Subsidiary.
(u) Each
of the Company and its Subsidiary has fulfilled its
obligations,
if any,
under the minimum funding standards of Section 302 of the
United
States
Employee Retirement Income Security Act of 1974 ("ERISA") and
the
regulations and published interpretations thereunder with respect
to each
"PLAN" (as
defined in Section 3(3) of ERISA and such regulations and
published
interpretations) in which employees of the Company and its
Subsidiary
are eligible to participate and each such plan is in compliance
in all
material respects with the presently applicable provisions of
ERISA
and such
regulations and published interpretations. No "PROHIBITED
TRANSACTION" (as defined in Section 406 of ERISA, or Section 4975
of the
Internal
Revenue Code of 1986, as amended from time to time (the
"CODE"))
has
occurred with respect to any employee benefit plan which could have
a
Material
Adverse Effect. Each of the Company and its Subsidiary has not
incurred
any unpaid liability to the Pension Benefit Guaranty
Corporation
(other
than for the payment of premiums in the ordinary course) or to
any
such plan
under Title IV of ERISA. Each "PENSION PLAN" (as defined in
ERISA) for
which the Company or its Subsidiary would have any liability
that is
intended to be qualified under Section 401(a) of the Code is so
qualified
in all material respects and nothing has occurred, whether by
action or
by failure to act, which could cause the loss of such
qualification.
(v) The
Company and its Subsidiary maintain insurance in such amounts
and
covering
such risks as is adequate for the conduct of its business and
the
value of
its properties and as is customary for companies engaged in
similar
businesses in similar industries; all such insurance is fully
in
force on
the date hereof and will be fully in force on the Closing Date.
(w) Each
of the Company and its Subsidiary has made all filings,
applications and submissions required by, and possesses all
approvals,
licenses,
certificates, certifications, clearances, consents, exemptions,
marks,
notifications, orders, permits and other authorizations issued
by,
the
appropriate federal, state or foreign regulatory authorities
(including, without limitation, the FDA, and any other foreign,
federal,
state or
local government or regulatory authorities performing functions
similar to
those performed by the FDA) necessary to conduct its business
as
presently conducted (collectively, "PERMITS"), except for such
Permits
which the
failure to obtain would not have a Material Adverse Effect, and
is in
compliance with the terms and conditions of all such Permits; all
of
such
Permits held by each of the Company and its Subsidiary are valid
and
in full
force and effect; there is no pending or threatened action,
suit,
claim or
proceeding which may cause any such Permit to be limited,
revoked,
cancelled, suspended, modified or not renewed and each of the
Company
and its Subsidiary has not received any notice of proceedings
relating
to the limitation, revocation, cancellation, suspension,
modification or non-renewal of any such Permit which, singularly or
in the
aggregate,
if the subject of an unfavorable decision, ruling or finding,
would have
a Material Adverse Effect, whether or not arising from
10
<PAGE>
transactions in the ordinary course of business, except as set
forth in or
contemplated by the Base Prospectus.
(x)
Cacciamatta Accountancy Corp., who have certified certain
financial
statements
of the Company and delivered their report with respect to the
audited
consolidated financial statements and schedules included in the
Base
Prospectus, the Prospectus Supplement or the Registration
Statement,
or
incorporated by reference therein, as the case may be, are
independent
registered
public accountants with respect to the Company within the
meaning of
the Securities Act and the Rules and Regulations.
(y) Each
of the Company and its Subsidiary has filed all foreign,
federal,
state and local tax returns
that are required to be filed or has requested
extensions
thereof (except in any case in which the failure so to file
would not
have a Material Adverse Effect, except as set forth in the Base
Prospectus) and has paid all taxes required to be paid by it and
any other
assessment, fine or penalty levied against it, to the extent that
any of
the
foregoing is due and payable, except for any such assessment, fine
or
penalty
that is currently being contested in good faith or as would not
have a
Material Adverse Effect, except as set forth in the Base
Prospectus.
(z) The
principal executive officer and principal financial officer of
the
Company
have made all certifications required by the Sarbanes-Oxley Act
of
2002 and
the rules and regulations promulgated in connection therewith
(the
"SARBANES-OXLEY ACT"), and the statements contained in any such
certification are complete and correct. The Company maintains
"disclosure
controls
and procedures" (as defined in Rule 13a-14(c) under the
Exchange
Act), and
such controls and procedures are designed (i) to ensure that
information required to be disclosed by the Company in the reports
that it
files or
submits under the Exchange Act is recorded, processed,
summarized
and
reported, within the time periods specified in the Commission's
rules
and forms
and (ii) to ensure that information required to be disclosed by
the
Company in the reports that it files or submits under the Exchange
Act
is
accumulated and communicated to the Company's management, including
its
principal
executive officer and principal financial officer, as
appropriate to allow timely decisions regarding required
disclosure. The
Company
does not have any material weaknesses in internal controls, and
to
the
Company's knowledge there has been no fraud, whether or not
material,
that
involves management or other employees of the Company or its
Subsidiary
who have a significant role in the Company's internal controls.
The
Company is otherwise in compliance in all respects with all
applicable
effective
provisions of the Sarbanes-Oxley Act and the rules and
regulations promulgated by the Commission (and intends to comply
with all
applicable
provisions that are not yet effective upon effectiveness).
(aa) Each
of the Company and its Subsidiary maintains a system of
internal
accounting
controls sufficient to provide reasonable assurance 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
generally
accepted
accounting
11
<PAGE>
principles
and to maintain accountability of 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 the existing assets at reasonable intervals and
appropriate
action is
taken with respect to any differences. Except as described in
the Base
Prospectus, since the end of the Company's most recent fiscal
year,
there has been no change in the Company's or its Subsidiary'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.
(bb) Each
of the Company and its Subsidiary (i) is in compliance in all
material
respects with any and all applicable foreign, federal, state
and
local laws
and regulations relating to the protection of human health and
safety,
the environment or hazardous or toxic substances or wastes,
pollutants
or contaminants ("ENVIRONMENTAL LAWS"), (ii) has received and
is in
compliance with all permits, licenses or other approvals required
of
it under
applicable Environmental Laws to conduct its business and (iii)
has not
received notice of any actual or potential liability for the
investigation or remediation of any disposal or release of
hazardous or
toxic
substances or wastes, pollutants or contaminants, except where
such
non-compliance with Environmental Laws, failure to receive
required
permits,
licenses or other approvals, or liability would not,
individually
or in the
aggregate, have a Material Adverse Effect, whether or not
arising
from transactions in the ordinary course of business, except as
set forth
in or contemplated by the Base Prospectus (exclusive of any
supplement
thereto). Neither the Company nor its Subsidiary has been named
as a
"POTENTIALLY RESPONSIBLE PARTY" under the Comprehensive
Environmental
Response,
Compensation, and Liability Act of 1980, as amended.
(cc) There
has been no storage, disposal, generation, manufacture,
refinement, transportation, handling or treatment of medical
wastes, toxic
wastes,
hazardous wastes or hazardous substances by the Company or its
Subsidiary
(or, to the Company's knowledge, any of the Company's or its
Subsidiary's predecessors in interest) at, upon or from any of
the
property
now or previously owned or leased by the Company or its
Subsidiary
in violation of any applicable Environmental Law which would
require
remedial action under any applicable Environmental Law, except
for
any
violation or remedial action which would not cause, singularly or
in
the
aggregate with all such violations and remedial actions, a
Material
Adverse
Effect; there has been no material spill, discharge, leak,
emission,
injection, escape, dumping or release of any kind onto such
property
or of any medical wastes, toxic wastes, hazardous wastes or
hazardous
substances due to or caused by the Company or its Subsidiary or
with
respect to which the Company or its Subsidiary had knowledge,
except
for any
such spill, discharge, leak, emission, injection, escapes,
dumpings
or releases which would not cause or would not be reasonably
likely to
cause, singularly or in the aggregate with all such spills,
discharges, leaks, emissions, injections, escapes, dumpings or
releases, a
Material
Adverse Effect; and the terms "hazardous substances," "toxic
wastes,"
"hazardous wastes" and "medical wastes" shall have the meanings
specified
in any applicable Environmental Laws.
12
<PAGE>
(dd) In
the ordinary course of its business, the Company and its
Subsidiary
periodically reviews the effect of Environmental Laws on the
business,
operations and properties of each of the Company and its
Subsidiary
in the course of which it identifies and evaluates 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 any permit, license or approval,
any
related constraints on operating activities and any potential
liabilities to third parties). On the basis of such review, the
Company
and its
Subsidiary has reasonably concluded that such associated costs
and
liabilities would not, singularly or in the aggregate, have a
Material
Adverse
Effect, whether or not arising from transactions in the
ordinary
course of
business, except as set forth in or contemplated by the Base
Prospectus.
(ee) Each
of the Company and its Subsidiary owns, possesses, licenses or
has other
rights to use all foreign and domestic patents, patent
applications, trade and service
marks, trade and service mark
registrations, trade names, copyrights, licenses, inventions,
trade
secrets,
technology, Internet domain names, know-how and other
intellectual property (collectively, the "INTELLECTUAL
PROPERTY")
necessary
for the conduct of the Company's business as now conducted or
as
proposed
in the Base Prospectus, the Prospectus Supplement and the Time
of
Sale
Prospectus, if any, to be conducted. Except as set forth in the
Base
Prospectus, (a) there are no rights of third parties to any
such
Intellectual Property; (b) to the best of the Company's knowledge,
there
is no
infringement by third parties of any such Intellectual Property;
(c)
there is
no pending or, to the best of the Company's knowledge,
threatened
action,
suit, proceeding or claim by others challenging each of the
Company's
and the Subsidiary's rights in or to any such Intellectual
Property,
and neither the Company nor its Subsidiary is unaware of any
facts
which would form a reasonable basis for any such claim; (d) there
is
no pending
or, to the best of the Company's knowledge, threatened action,
suit,
proceeding or claim by others challenging the validity or scope
of
any such
Intellectual Property; (e) there is no pending or, to the best
of
the
Company's knowledge, threatened action, suit, proceeding or claim
by
others
that the Company or its Subsidiary infringe or otherwise
violate
any
patent, trademark, copyright, trade secret or other proprietary
rights
of others,
and neither the Company nor its Subsidiary is unaware of any
other fact
which would form a reasonable basis for any such claim; (f) to
the
Company's knowledge, there is no third-party U.S. patent or
published
U.S.
patent application which contains claims for which an
Interference
Proceeding
could be commenced against any patent or patent application
that is
part of the Intellectual Property; (g) there is no pending or,
to
the best
of the Company's knowledge, threatened action, suit, proceeding
or claim
by others claiming the ownership of and interest in the
Intellectual Property; and (h) to the best of the Company's
knowledge, the
Company
and its Subsidiary have taken all steps necessary to perfect
its
ownership
of and interest in the Intellectual Property.
(ff) The
clinical, pre-clinical and other studies and tests conducted by
or on
behalf of or sponsored by the Company or its Subsidiary that
are
described
or referred to in the Base Prospectus or Prospectus Supplement
were and,
if still pending, are being conducted in accordance with all
statutes,
laws, rules and
13
<PAGE>
regulations, as applicable (including, without limitation,
those
administered by the FDA or by any foreign, federal, state or
local
governmental or regulatory authority performing functions similar
to those
performed
by the FDA). The descriptions of the results of such studies
and
tests that
are described or referred to in the Base Prospectus or
Prospectus
Supplement are accurate and complete in all material respects
and fairly
present t
