Exhibit 10.1
9,101,912 Shares
and Warrants to Purchase
3,640,762 Shares
GTC BIOTHERAPEUTICS,
INC.
Shares of Common
Stock
($.01 par value)
PLACEMENT AGENT
AGREEMENT
December 7, 2005
SG COWEN & CO., LLC
RODMAN & RENSHAW, LLC
c/o SG Cowen & Co., LLC
1221 Avenue of the Americas
New York, New York 10020
Dear Sirs:
GTC Biotherapeutics, Inc., a
Massachusetts 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 a form to be agreed
upon (the “ Subscription Agreements ”) and
entered into severally with the Purchasers that become parties
thereto (each a “ Purchaser ” and, collectively,
the “ Purchasers ”), up to an aggregate of
9,101,912 units (the “ Units ”), each consisting
of (i) one share (the “ Shares ”) of the
Company’s common stock, par value $.01 per share (the “
Common Stock ”) and (ii) one warrant (the “
Warrants ”) to purchase 0.4 shares of Common Stock, in
substantially the form attached hereto as Exhibit A . The
shares issuable upon the exercise of the Warrants are referred to
herein as the “Warrant Shares” and, together with the
Units, the Shares and the Warrants, are referred to herein as the
“Securities.” 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 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 Units from the
Company in connection with the proposed offering of the Units (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 Units otherwise than through the Placement
Agents.
(b) The Placement Agents agree, as
agents of the Company, to use their best efforts to solicit offers
to purchase the Units 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 reasonable best efforts to assist the Company in
obtaining performance by each Purchaser whose offer to purchase
Units 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 Units for their own account and, in
soliciting purchases of Units, 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 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 Units as
principals.
(c) Subject to the provisions of
this Section 1 , offers for the purchase of Units 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 Units
received by it as agent of the Company. The Company shall have the
sole right to accept offers to purchase the Units 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 Units
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 Units 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 six and one half percent (6.5%) of the gross proceeds
received by the Company from the sale of the Units on such Closing
Date.
(f) No Units 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
Units shall have been delivered to the Purchaser thereof against
payment by such Purchaser. If the Company shall default in its
obligation to deliver Units 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. The Company
represents and warrants to, and agrees with, the several Placement
Agents that:
(a) The Company has filed with the
Securities and Exchange Commission (the “ Commission
”) a registration statement on Form S-3 (Registration File
No. 333-129166) under the Securities Act of 1933, as amended
(the “ Securities Act ”), which became effective
on November 14, 2005, for the registration under the
Securities Act of the Securities. At the time of such filing, the
Company met the requirements of Form S-3 under the Securities Act.
Such registration statement meets the requirements set forth in
Rule 415(a)(l)(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 Units 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 in this
Agreement 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 (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 in this Agreement 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,” “referenced,” “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.
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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 preliminary prospectus, if
any, together with the free writing prospectuses, if any, used in
connection with the Offering on or prior to the date hereof,
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 (with respect to Incorporated Documents
incorporated by reference in the Base Prospectus or Prospectus
Supplement, in light of the circumstances under which they were
made) 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, in light of the
circumstances under which they were made, 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
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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 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 on 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 prior consent of the Representative,
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, as applicable, filed as a part
thereof, and conformed copies of the Registration Statement
(without exhibits), 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 Closing Date, any offering material in
connection with the offering and sale of the Units 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) The Company has been duly
organized and is validly existing as a corporation in good standing
(or the equivalent thereof, if any) under the laws of its
jurisdiction of incorporation, is duly qualified to do business and
is in good standing (or the equivalent thereof, if any) as a
foreign corporation 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 necessary to own or
hold its properties and to conduct the business in which it is
engaged, except where the failure to be so qualified and in good
standing or have such power or authority would not have,
individually 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
subsidiaries taken as a whole (a “ Material Adverse
Effect ”).
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(f) The Shares to be issued and sold
by the Company hereunder and under the Subscription Agreements and
the Warrant Shares, which are issuable upon exercise of the
Warrants, have 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 similar rights. The Securities conform to the
descriptions 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 or any of its subsidiaries that have been
granted by the Company other than those referenced in the Base
Prospectus. 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) The Company has the full right,
power and authority to enter into this Agreement, each of the
Subscription Agreements and the Warrants and to perform and to
discharge its obligations hereunder and thereunder; and each of
this Agreement, each of the Subscription Agreements and the
Warrants 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 (i) applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting the
enforcement of creditors’ rights generally and
(ii) general principles of equity, regardless of whether
asserted in a proceeding at equity or law, and except to the extent
that the indemnification and contribution provisions of
Section 7 hereof may be limited by federal or state
securities laws and public policy considerations in respect
thereof.
(i) 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 agreement or instrument to which the Company is
a party or by which the Company is bound or to which any of the
property or assets of the Company is
6
subject, nor will such actions
result in any violation of the provisions of the charter or by-laws
of the Company 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 any of its properties
or assets, except for such breach, violation or default that,
individually or in the aggregate, would not reasonably be expected
to have a Material Adverse Effect.
(j) 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 Time of Sale Prospectus, if any, 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
contained in the Registration Statement fairly present the
information required to be shown with respect thereto. Other than
as described in the Base Prospectus Time of Sale Prospectus, if
any, no such franchise, contract, lease, instrument or other
document has been suspended or terminated for convenience or
default by the Company or any of the other parties thereto, and the
Company has not received notice or 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, individually or in the aggregate, have a
Material Adverse Effect.
(k) All existing minute books of the
Company, 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
that are not properly approved and/or recorded in the Corporate
Records.
(l) 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 and in the Subscription
Agreements, except such as have been 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 Units by the Company in
the manner contemplated herein and in the Base Prospectus, the
Prospectus Supplement or the Time of Sale Prospectus, if
any.
(m) Except as described in the Base
Prospectus Time of Sale Prospectus, if any, (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 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
7
the Company in connection with and
as a result of the offer and sale of the Units, 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 Units 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 Units as contemplated
thereby or otherwise, except for persons and entities 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.
(n) The financial statements,
together with the related notes and schedules, of the Company
included in the Base Prospectus, the Prospectus Supplement, the
Time of Sale Prospectus, if any, or the Registration Statement 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 subsidiaries and other
consolidated entities 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. 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 Time of Sale
Prospectus, if any, the Prospectus Supplement or the Registration
Statement or incorporated by reference therein, as the case may
be.
(o) Except as set forth in the Base
Prospectus or the Time of Sale Prospectus, if any, there is no
legal or governmental proceeding pending to which the Company is a
party or of which any property or assets of the Company is the
subject which is required to be described in the Base Prospectus or
the Time of Sale Prospectus, if any, and is not described therein,
or which, individually or in the aggregate, if determined adversely
to the Company, would have a Material Adverse Effect or would
prevent or adversely affect the ability of the Company 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.
(p) The Company has good and
marketable title to all property (real and personal) described in
the Registration Statement, the Base Prospectus, the Time of Sale
Prospectus, if any, and the Prospectus Supplement as being owned by
the Company, free and clear of all claims, liens,
encumbrances,
8
security interests, defects or
restrictions upon voting or transfer or any other claims of any
kind (“ Liens ”), except for (i) Liens
disclosed in the financial statements included in the Base
Prospectus and (ii) Liens that do not materially interfere
with the use made or proposed to be made of such property by the
Company 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 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.
(q) The Company is not (i) in
violation of any provision of its charter or by-laws, (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 any of its 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, individually or in the aggregate,
would not have a Material Adverse Effect.
(r) The contracts described in the
Company’s regular reports on Forms 10-K, 10-Q 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 except any
such breach or default which, individually or in the aggregate,
would not have a Material Adverse Effect.
(s) The Company 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 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 would have a Material Adverse Effect.
The Company has not incurred any unpaid liability to the Pension
Benefit Guaranty Corporation (other than for the payment
of
9
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 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.
(t) The Company 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 businesses
(collectively, “ Permits ”), except for such
Permits which the failure to obtain would not have a Material
Adverse Effect (the “ Immaterial Permits ”), and
is in compliance in all material respects with the terms and
conditions of all such Permits other than the Immaterial Permits
(the “ Required Permits ”); all of such Required
Permits held by the Company are valid and in full force and effect;
there is no pending or, to the Company’s knowledge,
threatened action, suit, claim or proceeding which may cause any
such Required Permit to be limited, revoked, cancelled, suspended,
modified or not renewed and the Company has not received any notice
of proceedings relating to the limitation, revocation,
cancellation, suspension, modification or non-renewal of any such
Required Permit which, individually 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 transactions
in the ordinary course of business, except as set forth in or
contemplated by the Base Prospectus, the Time of Sale Prospectus,
if any, or the Prospectus Supplement.
(u) PricewaterhouseCoopers LLP, 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, to the
Company’s knowledge, independent public accountants with
respect to the Company within the meaning of the Securities Act and
the Rules and Regulations.
(v) The Company 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 and except as set forth in the Base Prospectus, the Time of
Sale Prospectus, if any, and the Prospectus Supplement) 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 and except as set forth in
the Base Prospectus, the Time of Sale Prospectus, if any, and the
Prospectus Supplement.
(w) The principal executive officer
and principal financial officer of the Company have made all
certifications required by the Sarbanes-Oxley Act of
10
2002 (the “ Sarbanes-Oxley
Act ”), and the rules and regulations promulgated
thereunder, and the statements contained in any such certification
are correct and comply as to form as of the dates made. 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 there has been no
fraud, whether or not material, that involves management or other
employees 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
thereunder by the Commission (and intends to comply upon
effectiveness with all applicable provisions that are not yet
effective).
(x) The Company 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 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.
(y) To the Company’s
knowledge, the Company (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, the Time of Sale
Prospectus, if any, and the Prospectus Supplement. The Company has
not been named as a “potentially responsible party”
under the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as amended.
11
(z) To the Company’s
knowledge, 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, to the knowledge of the Company, any
of its predecessors in interest) at, upon or from any of the
property now or previously owned or leased by the Company 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,
individually 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 with respect to which the Company
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, individually 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.
(aa) The Company 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 and the Time of Sale Prospectus, if any, (i) to the
Company’s knowledge, there are no rights of third parties to
any such Intellectual Property except through licensing or
cross-licensing agreements or where the exercise of such rights
would not result, individually or in the aggregate, in a Material
Adverse Effect; (ii) to the Company’s knowledge, there
is no infringement by third parties of any such Intellectual
Property that is necessary and material to the Company’s
business as it is presently being conducted; (iii) there is no
pending or, to the Company’s knowledge, threatened action,
suit, proceeding or claim by others challenging the Company’s
rights in or to any such Intellectual Property, and the Company is
unaware of any facts which would form a reasonable basis for any
such claim; (iv) there is no pending or, to the
Company’s knowledge, threatened action, suit, proceeding or
claim by others challenging the validity or scope of any such
Intellectual Property; (v) there is no pending or, to the
Company’s knowledge, threatened action, suit, proceeding or
claim by others that the Company infringes or otherwise violates
any patent, trademark, copyright, trade secret or other proprietary
rights of others, and the Company is unaware of any other fact
which would form a reasonable basis for any such claim;
(vi) except as described in the Base Prospectus, the Time of
Sale Prospectus, if any, and the Prospectus Supplement, 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
12
Interference Proceeding could be
commenced against any patent or patent application described in the
Base Prospectus and the Time of Sale Prospectus, if any, as being
owned by or licenses to the Company; and (vii) the Company has
taken all steps reasonably determined by the Company to be
necessary to perfect its ownership of and interest in the
Intellectual Property.
(bb) The clinical, pre-clinical and
other studies and tests conducted by or on behalf of or sponsored
by the Company were and, if still pending, are being conducted in
accordance with all statutes, laws, rules and 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) except where the failure to comply with such
statutes, laws, rules or regulations would not result, individually
or in the aggregate, in a Material Adverse Effect.
(cc) The Company complies with
applicable regulatory requirements (including, without limitation,
those administered by the FDA and any other relevant foreign,
federal, state or local governmental or regulatory authority
performing functions similar to those performed by the FDA), except
where the failure to comply with such regulatory requirements would
not result, individually or in the aggregate, in a Material Adverse
Effect.
(dd) The Company has not failed to
file with the applicable regulatory authorities (including, without
limitation, the FDA or any foreign, federal, state or local
governmental or regulatory authority performing functions similar
to those performed by the FDA) any filing, declaration, listing,
registration, report or submission in respect of which any such
failure would have a Material Adverse Effect; all such filings,
declarations, listings, registrations, reports or submissions were
in compliance in all material respects with applicable laws when
filed and no deficiencies with respect to such compliance have been
asserted by any applicable regulatory authority (including, without
limitation, the FDA or any foreign, federal, state or local
governmental or regulatory authority performing functions similar
to those performed by the FDA) with respect to any such filings,
declarations, listings, registrations, reports or
submissions.
(ee) No relationship, direct or
indirect, exists between or among the Company on the one hand and
the directors, officers, stockholders, customers or suppliers of
the Company on the other hand which is required to be described in
the Base Prospectus, the Time of Sale Prospectus, if any, or the
Prospectus Supplement and which is not so described.
(ff) Neither the Company nor any
other person associated with or acting on behalf of the Company
including, without limitation, any director, officer, agent or
employee of the Company or any of its subsidiaries, has, directly
or indirectly, while acting on behalf of the Company or any of its
subsidiaries (i) used any corporate funds for unlawful
contributions, gifts, entertainment or other unlawful expenses, or
received or retained any funds, relating to political activity;
(ii) made any unlawful payment from corporate funds to, or
received or retained any unlawful funds from, foreign or domestic
government officials or employees or to or from foreign or domestic
political parties or campaigns;
13
(iii) violated any provision of the
Foreign Corrupt Practices Act of 1977, as amended; or
(iv) made any other unlawful payment or received or retained
any other unlawful funds.
(gg) The Company is not or, after
giving effect to the offering and sale of the Units and the
application of the proceeds thereof as described in the Base
Prospectus, the Time of Sale Prospectus, if any, and the Prospectus
Supplement, will not become an “investment company” as
defined in the Investment Company Act of 1940, as
amended.
(hh) No forward-looking statement
(within the meaning of Section 27A of the Securities Act and
Section 21E of the Exchange Act) contained in the Base
Prospectus, the Prospectus Supplement and the Time of Sale
Prospectus, if any, has been made or reaffirmed without a
reasonable basis or has been disclosed other than in good
faith.
(ii) Other than as contemplated by
this Agreement, neither the Company nor any of its subsidiaries is
a party to any contract, agreement or understanding 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
Units.
(jj) The Company has not sustained,
since the date of the latest audited financial statements included
in the Base Prospectus or the Registration Statement, or
incorporated by reference therein, as the case may be, any material
loss or interference with its business from fire, explosion, flood,
terrorist act 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 in or
contemplated by the Base Prospectus and the Time of Sale
Prospectus, if any.
(kk) Except as set forth in or as
otherwise contemplated by the Registration Statement, the Base
Prospectus or the Time of Sale Prospectus, if any, subsequent to
the respective dates as of which information is given in the
Registration Statement or the Base Prospectus, there has not been
(i) any adverse change or development that would reasonably be
expected to result in a Material Adverse Effect, (ii) any
transaction which is material to the Company, (iii) any
obligation, direct or contingent (including any off-balance sheet
obligations), incurred by the Company outside the ordinary course
of business, which is material to the Company, (iv) any change
in the capital stock (other than the issuance of shares of Common
Stock upon exercise of stock options and warrants disclosed as
outstanding in the Registration Statement, the Base Prospectus and
the Time of Sale Prospectus, if any, and the grant of options under
existing stock option plans described in the Registration Statement
and the Base Prospectus) or outstanding indebtedness of the
Company, or (v) any dividend or distribution of any kind
declared, paid or made on the capital stock of the
Company.
(ll) The Shares are registered under
the Exchange Act and are duly listed and admitted and authorized
for trading, subject to official notice of issuance, on the Nasdaq
National Market (“ Nasdaq ”) and the Company has
taken no
14
action designed to terminate, or
likely to have the effect of terminating the registration of the
Common Stock under the Exchange Act or delisting or suspending from
trading the Common Stock from Nasdaq, nor has the Company received
any information suggesting that the Commission or the National
Association of Securities Dealers, Inc. (“ NASD
”) is contemplating terminating or suspending such
registration or listing.
(mm) Neither the Company nor any of
its subsidiaries nor any of their 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.
(nn) There are no affiliations with
the NASD among the Company’s officers, directors or, to the
knowledge of the Company, any five percent (5%) or greater
stockholder of the Company, except as set forth in the Base
Prospectus, or otherwise disclosed in writing to the Placement
Agents.
(oo) There are no outstanding loans,
advances (except normal advances for business expense in the
ordinar
