<PAGE>
Exhibit 1.1
3,750,000 Shares
Valera Pharmaceuticals, Inc.
Common Stock
($0.001 Par Value)
UNDERWRITING AGREEMENT
_________ __, 2006
<PAGE>
UNDERWRITING AGREEMENT
_________ __, 2006
UBS Securities LLC
Banc of America Securities LLC
As Representatives of the several Underwriters
c/o UBS Securities LLC
299 Park Avenue
New York, New York
10171-0026
Ladies and Gentlemen:
Valera Pharmaceuticals, Inc., a Delaware corporation (the
"Company"), proposes to issue and sell to the underwriters named in
Schedule A
annexed hereto (the "Underwriters"), for whom you are acting as
representatives
(the "Representatives"), an aggregate of 3,750,000 shares (the
"Firm Shares")
of the class of Common Stock, $0.001 par value (the "Common
Stock"), of the
Company. In addition, solely for the purpose of covering
over-allotments, the
Company proposes to grant to the Underwriters the option to
purchase from the
Company up to an additional 562,500 shares of Common Stock (the
"Additional
Shares"). The Firm Shares and the Additional Shares are hereinafter
collectively
sometimes referred to as the "Shares." The Shares are described in
the
Prospectus which is referred to below.
The Company hereby
acknowledges that, in connection with the
proposed offering of the Shares, it has requested UBS Financial
Services Inc.
("UBS-FinSvc") to administer a directed share program (the
"Directed Share
Program") under which up to 215,625 Firm Shares, or 5% of the Firm
Shares to
be purchased by the Underwriters (the "Reserved Shares"), shall be
reserved for
sale by UBS-FinSvc at the initial public offering price to the
Company's
officers, directors, employees and consultants and other persons
having a
relationship with the Company as designated by the Company (the
"Directed Share
Participants"), as part of the distribution of the Shares by the
Underwriters,
subject to the terms of this Agreement, the applicable rules,
regulations and
interpretations of the National Association of Securities Dealers,
Inc. (the
"NASD"), and all other applicable laws, rules and regulations. The
number of
Shares available for sale to the general public will be reduced to
the extent
that Directed Share Participants purchase Reserved Shares. The
Underwriters may
offer any Reserved Shares not purchased by Directed Share
Participants to the
general public on the same basis as the other Shares being issued
and sold
hereunder. The Company has supplied UBS-FinSvc with the names,
addresses and
telephone numbers of the individuals or other entities which the
Company has
designated to be participants in the Directed Share Program. It is
understood
that any number of those designated to participate in the Directed
Share Program
may decline to do so.
<PAGE>
3
The Company has prepared and filed, in accordance with the
provisions of the Securities Act of 1933, as amended, and the rules
and
regulations promulgated thereunder (collectively, the "Act"), with
the
Securities and Exchange Commission (the "Commission") a
registration statement
on Form S-1 (File No. 333-123288) under the Act including a
prospectus, relating
to the Shares.
Except where the context otherwise requires, "Registration
Statement," as used herein, means the registration statement, as
amended at the
time of such registration statement's effectiveness for purposes of
Section 11
of the Act, as such section applies to the respective Underwriters
(the
"Effective Time"), including (i) all documents filed as a part
thereof, (ii) any
information contained in a prospectus filed with the Commission
pursuant to Rule
424(b) under the Act and deemed, pursuant to Rule 430A or Rule 430C
under the
Act, to be part of the registration statement at the Effective
Time, and (iii)
any registration statement filed to register the offer and sale of
Shares
pursuant to Rule 462(b) under the Act.
The Company has furnished to you, for use by the Underwriters and
by
dealers in connection with the offering of the Shares, copies of
one or more
preliminary prospectuses relating to the Shares. Except where the
context
otherwise requires, "Preliminary Prospectus," as used herein, means
each such
preliminary prospectus, in the form so furnished.
Except where the context otherwise requires, "Prospectus," as
used
herein, means the prospectus filed by the Company with the
Commission pursuant
to Rule 424(b) under the Act on or before the second business day
after the date
hereof (or such earlier time as may be required under the Act), or,
if no such
filing is required, the final prospectus included in the
Registration Statement
at the time it became effective under the Act, in each case in the
form
furnished by the Company to you for use by the Underwriters and by
dealers in
connection with the offering of the Shares.
"Permitted Free Writing Prospectuses," as used herein, means
the
documents listed on Schedule B attached hereto and each "road show"
(as defined
in Rule 433 under the Act), if any, related to the offering of the
Shares
contemplated hereby that is a "written communication" (as defined
in Rule 405
under the Act) (each such road show, a "Road Show").
"Disclosure Package," as used herein, means any Preliminary
Prospectus together with any combination of one or more of the
Permitted Free
Writing Prospectuses, if any.
As used in this Agreement, "business day" shall mean a day on
which
the New York Stock Exchange (the "NYSE") is open for trading. The
terms
"herein," "hereof," "hereto," "hereinafter" and similar terms, as
used in this
Agreement, shall in each case refer to this Agreement as a whole
and not to any
particular section, paragraph, sentence or other subdivision of
this Agreement.
The term "or," as used herein, is not exclusive.
The Company has prepared and filed, in accordance with Section 12
of
the Securities Exchange Act of 1934, as amended, and the rules and
regulations
thereunder (collectively, the "Exchange Act"), a registration
statement (as
amended, the "Exchange Act Registration Statement") on Form 8-A
(File No. -)
under the Exchange Act to register, under Section 12(g) of the
Exchange Act, the
class of securities consisting of the Common Stock.
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4
The Company and the Underwriters agree as follows:
1. Sale
and Purchase. Upon the basis of the representations and
warranties
and subject to the terms and conditions herein set forth, the
Company agrees to
issue and sell to the respective Underwriters and each of the
Underwriters,
severally and not jointly, agrees to purchase from the Company the
number of
Firm Shares set forth opposite the name of such Underwriter in
Schedule A
attached hereto, subject to adjustment in accordance with Section 8
hereof, in
each case at a purchase price of $______ per Share. The Company is
advised by
you that the Underwriters intend (i) to make a public offering of
their
respective portions of the Firm Shares as soon after the effective
date of the
Registration Statement as in your judgment is advisable and (ii)
initially to
offer the Firm Shares upon the terms set forth in the Prospectus.
You may from
time to time increase or decrease the public offering price after
the initial
public offering to such extent as you may determine.
In addition, the Company hereby grants to the several
Underwriters
the option (the "Over-Allotment Option") to purchase, and upon the
basis of the
representations and warranties and subject to the terms and
conditions herein
set forth, the Underwriters shall have the right to purchase,
severally and not
jointly, from the Company, ratably in accordance with the number of
Firm Shares
to be purchased by each of them, all or a portion of the Additional
Shares as
may be necessary to cover over-allotments made in connection with
the offering
of the Firm Shares, at the same purchase price per share to be paid
by the
Underwriters to the Company for the Firm Shares. The Over-Allotment
Option may
be exercised by the Representatives on behalf of the several
Underwriters at any
time and from time to time on or before the thirtieth day following
the date of
the Prospectus, by written notice to the Company. Such notice shall
set forth
the aggregate number of Additional Shares as to which the
Over-Allotment Option
is being exercised and the date and time when the Additional Shares
are to be
delivered (any such date and time being herein referred to as an
"additional
time of purchase"); provided, however, that no additional time of
purchase shall
be earlier than the "time of purchase" (as defined below) nor
earlier than the
second business day after the date on which the Over-Allotment
Option shall have
been exercised nor later than the tenth business day after the date
on which the
Over-Allotment Option shall have been exercised. The number of
Additional Shares
to be sold to each Underwriter shall be the number which bears the
same
proportion to the aggregate number of Additional Shares being
purchased as the
number of Firm Shares set forth opposite the name of such
Underwriter on
Schedule A hereto bears to the total number of Firm Shares
(subject, in each
case, to such adjustment as you may determine to eliminate
fractional shares),
subject to adjustment in accordance with Section 8 hereof.
2. Payment
and Delivery. Payment of the purchase price for the Firm Shares
shall be made to the Company by Federal Funds wire transfer,
against delivery of
the certificates for the Firm Shares to you through the facilities
of The
Depository Trust Company ("DTC") for the respective accounts of
the
Underwriters. Such payment and delivery shall be made at 10:00
A.M., New York
City time, on _______________, 2006 (unless another time shall be
agreed to by
you and the Company or unless postponed in accordance with the
provisions of
Section 8 hereof). The time at which such payment and delivery are
to be made is
hereinafter sometimes called "the time of purchase." Electronic
transfer of the
Firm Shares shall be made to you at the time of purchase in such
names and in
such denominations as you shall specify.
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5
Payment of the purchase price for the Additional Shares shall
be
made at the additional time of purchase in the same manner and at
the same
office as the payment for the Firm Shares. Electronic transfer of
the Additional
Shares shall be made to you at the additional time of purchase in
such names and
in such denominations as you shall specify.
Deliveries of the documents described in Section 6 hereof with
respect to the purchase of the Shares shall be made at the offices
of Skadden,
Arps, Slate, Meagher & Flom LLP, Four Times Square, New York,
NY, at 9:00 A.M.,
New York City time, on the date of the closing of the purchase of
the Firm
Shares or the Additional Shares, as the case may be.
3.
Representations and Warranties of the Company. The Company
represents
and warrants to and agrees with each of the Underwriters that:
(a) the Registration
Statement has heretofore become effective under
the Act
or, with respect to any registration statement to be filed to
register
the offer and sale of Shares pursuant to Rule 462(b) under the
Act, will
be filed with the Commission and become effective under the Act
no later
than 10:00 P.M., New York City time, on the date of
determination
of the
public offering price for the Shares; no stop order of the
Commission
preventing or suspending the use of any Preliminary Prospectus
or
Permitted Free Writing Prospectus or the effectiveness of the
Registration Statement has been issued, and no proceedings for
such
purpose
have been instituted or, to the Company's knowledge, are
contemplated by the Commission; the Exchange Act Registration
Statement
has become
effective as provided in Section 12 of the Exchange Act;
(b) the Registration Statement complied when it became
effective,
complies
as of the date hereof and, as amended or supplemented, at the
time of
purchase, each additional time of purchase, if any, and at all
times
during which a prospectus is required by the Act to be
delivered
(whether
physically or through compliance with Rule 172 under the Act or
any
similar rule) in connection with any sale of Shares, will comply,
in
all
material respects, with the requirements of the Act; the
Registration
Statement
did not, as of the Effective Time, contain an untrue statement
of a material
fact or omit to state a material fact required to be stated
therein or
necessary to make the statements therein not misleading; each
Preliminary Prospectus complied, at the time it was filed with
the
Commission, and complies as of the date hereof, in all material
respects
with the
requirements of the Act; at no time during the period that
begins
on the
earlier of the date of such Preliminary Prospectus and the date
such
Preliminary Prospectus was filed with the Commission and ends at
the
time of
purchase did or will any Preliminary Prospectus, as then
amended
or
supplemented, include an untrue statement of a material fact or
omit to
state a
material fact necessary in order to make the statements
therein,
in the
light of the circumstances under which they were made, not
misleading, and at no time during such period did or will any
Preliminary
Prospectus, as then amended or supplemented, together with any
combination
of one or
more of the then issued Permitted Free Writing Prospectuses, if
any,
include an untrue statement of a material fact or omit to state
a
material
fact necessary in order to make the statements therein, in the
light of
the circumstances under which they were made, not misleading;
the
Prospectus
will comply, as of its date, the date that it is filed with the
Commission, the time of purchase, each additional time of purchase,
if
any,
<PAGE>
6
and at all
times during which a prospectus is required by the Act to be
delivered
(whether physically or through compliance with Rule 172 under
the Act or
any similar rule) in connection with any sale of Shares, in all
material
respects, with the requirements of the Act (including, without
limitation, Section 10(a) of the Act); at no time during the period
that
begins on
the earlier of the date of the Prospectus and the date the
Prospectus
is filed with the Commission and ends at the later of the time
of
purchase, the latest additional time of purchase, if any, and the
end
of the
period during which a prospectus is required by the Act to be
delivered
(whether physically or through compliance with Rule 172 under
the Act or
any similar rule) in connection with any sale of Shares did or
will the
Prospectus, as then amended or supplemented, include an untrue
statement
of a material fact or omit to state a material fact necessary
in
order to
make the statements therein, in the light of the circumstances
under
which they were made, not misleading; at no time during the
period
that
begins on the date of such Permitted Free Writing Prospectus and
ends
at the time of
purchase did or will any Permitted Free Writing Prospectus
include an
untrue statement of a material fact or omit to state a material
fact
necessary in order to make the statements therein, in the light
of
the
circumstances under which they were made, not misleading;
provided,
however,
that the Company makes no representation or warranty with
respect
to any
statement contained in the Registration Statement, any
Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus
in
reliance
upon and in conformity with information concerning an
Underwriter
and
furnished in writing by or on behalf of such Underwriter through
you
to the
Company expressly for use in the Registration Statement, such
Preliminary Prospectus, the Prospectus or such Permitted Free
Writing
Prospectus;
(c) prior to the execution of this Agreement, the Company has
not,
directly
or indirectly, offered or sold any Shares by means of any
"prospectus" (within the meaning of the Act) or used any
"prospectus"
(within
the meaning of the Act) in connection with the offer or sale of
the
Shares, in each case other than the Preliminary Prospectuses and
the
Permitted
Free Writing Prospectuses, if any; the Company has not,
directly
or
indirectly, prepared, used or referred to any Permitted Free
Writing
Prospectus
except in compliance with Rules 164 and 433 under the Act;
assuming
that such Permitted Free Writing Prospectus is accompanied or
preceded
by the most recent Preliminary Prospectus that contains a price
range or
the Prospectus, as the case may be, and that such Permitted
Free
Writing
Prospectus is so sent or given after the Registration Statement
was filed
with the Commission (and after such Permitted Free Writing
Prospectus
was, if required pursuant to Rule 433(d) under the Act, filed
with the
Commission), the sending or giving, by any Underwriter, of any
Permitted Free
Writing Prospectus will satisfy the provisions of Rule 164
or Rule
433 (without reliance on subsections (b), (c) and (d) of Rule
164); each
of the Preliminary Prospectuses dated ?, 2006 and ?, 2006,
respectively, is a prospectus that, other than by reason of Rule
433 or
Rule 431
under the Act, satisfies the requirements of Section 10 of the
Act,
including a price range where required by rule; neither the
Company
nor the
Underwriters are disqualified, by reason of subsection (f) or
(g)
of Rule
164 under the Act, from using, in connection with the offer and
sale of
the Shares, "free writing prospectuses" (as defined in Rule 405
under the
Act) pursuant to Rules 164 and 433 under the Act; the Company
is
not an
"ineligible issuer" (as defined in Rule 405 under the Act) as
of
the
eligibility determination date for purposes of Rules 164 and 433
under
the Act
with respect to the offering of the Shares contemplated by the
Registration
<PAGE>
7
Statement;
the parties hereto agree and understand that the content of any
and all
"road shows" (as defined in Rule 433 under the Act) related to
the
offering
of the Shares contemplated hereby is solely the property of the
Company;
the Company has caused there to be made available at least one
version of
a "bona fide electronic road show" (as defined in Rule 433
under the
Act) in a manner that, pursuant to Rule 433(d)(8)(ii) under the
Act,
causes the Company not to be required, pursuant to Rule 433(d)
under
the Act,
to file, with the Commission, any Road Show;
(d) as of the date of this Agreement, the Company has an
authorized
and
outstanding capitalization as set forth in the sections of the
Registration Statement, the Preliminary Prospectuses and the
Prospectus
entitled
"Capitalization" and "Description of Capital Stock" (and any
similar
sections or information, if any, contained in any Permitted
Free
Writing
Prospectus), and, as of the time of purchase and any additional
time of
purchase, as the case may be, the Company shall have an
authorized
and
outstanding capitalization as set forth in the sections of the
Registration Statement and the Prospectus entitled "Capitalization"
and
"Description of Capital Stock" (and any similar sections or
information,
if any,
contained in any Permitted Free Writing Prospectus), (subject,
in
each case, to
the issuance of shares of Common Stock upon exercise of
stock
options and warrants disclosed as outstanding in the
Registration
Statement
(excluding the exhibits thereto), each Preliminary Prospectus
and the
Prospectus and grant of options under existing stock option
plans
described
in the Registration Statement (excluding the exhibits thereto),
each
Preliminary Prospectus and the Prospectus); all of the issued
and
outstanding shares of capital stock of the Company, including the
Common
Stock,
have been duly authorized and validly issued and are fully paid
and
non-assessable, have been issued in compliance with all federal and
state
securities
laws and were not issued in violation of any preemptive right,
resale
right, right of first refusal or similar right; prior to the
time
of
purchase, all outstanding shares of Series A 6% Cumulative
Convertible
Preferred
Stock, $0.001 par value per share, Series B 10% Cumulative
Convertible Preferred
Stock, $0.001 par value per share and Series C 6%
Cumulative
Convertible Preferred Stock, $0.001 par value per share, of the
Company
shall convert into shares of Common Stock in the manner
described
in the
Registration Statement (excluding the exhibits thereto), each
Preliminary Prospectus and the Prospectus; prior to the date
hereof, the
Company
has duly effected and completed a 1-for-6 reverse stock split
of
the Common
Stock in the manner described in the Registration Statement
(excluding
the exhibits thereto), each Preliminary Prospectus and the
Prospectus; and the [Second] Amended and Restated Certificate
of
Incorporation of the Company and the Amended and Restated Bylaws of
the
Company,
each in the form filed as an exhibit to the Registration
Statement,
have been heretofore duly authorized and approved in accordance
with the
Delaware General Corporation Law and shall become effective and
in full
force and effect at or before the time of purchase; the Shares
are
duly
listed, and admitted and authorized for trading, subject to
official
notice of
issuance and evidence of satisfactory distribution, on the
Nasdaq
National Market (the "Nasdaq");
(e) the Company has been duly incorporated and is validly
existing
as a
corporation in good standing under the laws of the State of
Delaware,
with full
corporate power and authority to own, lease and operate its
properties
and conduct its business as described in the Registration
Statement,
the Preliminary Prospectuses, the Prospectus and the Permitted
Free
<PAGE>
8
Writing
Prospectuses, if any, to execute and deliver this Agreement and
to
issue,
sell and deliver the Shares as contemplated herein;
(f) the Company is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction where
the
ownership
or leasing of its properties or the conduct of its business
requires
such qualification, except where the failure to be so qualified
and in
good standing would not, individually or in the aggregate, have
a
material
adverse effect on the business, properties, financial
condition,
results of
operations or prospects of the Company and the Subsidiaries (as
defined
below) taken as a whole (a "Material Adverse Effect");
(g) the Company has no subsidiaries (as defined under the Act)
other
than
Valera Pharmaceuticals Ireland Limited (the "Subsidiaries");
the
Company
owns all of the issued and outstanding capital stock of each of
the
Subsidiaries; other than the capital stock of the Subsidiaries,
the
Company
does not own, directly or indirectly, any shares of stock or
any
other
equity interests or long-term debt securities of any
corporation,
firm,
partnership, joint venture, association or other entity;
complete
and
correct copies of the charters and the bylaws of the Company and
each
Subsidiary
and all amendments thereto have been delivered to you, and,
except as
set forth in the exhibits to the Registration Statement, no
changes
therein will be made on or after the date hereof through and
including
the time of purchase or, if later, any additional time of
purchase;
each Subsidiary has been duly incorporated and is validly
existing
as a corporation in good standing under the laws of the
jurisdiction of its incorporation, with full corporate power and
authority
to own,
lease and operate its properties and to conduct its business as
described
in the Registration Statement, the Preliminary Prospectuses,
the
Prospectus
and the Permitted Free Writing Prospectuses, if any; each
Subsidiary
is duly qualified to do business as a foreign corporation and
is in good
standing in each jurisdiction where the ownership or leasing of
its
properties or the conduct of its business requires such
qualification,
except
where the failure to be so qualified and in good standing;
(h) the Shares 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 non-assessable and free of
statutory
and contractual preemptive rights, resale rights, rights of
first
refusal and similar rights;
(i) the capital stock of the Company, including the Shares,
conforms
in all
material respects to each description, if any, thereof contained
in
the
Registration Statement, any Preliminary Prospectus, the Prospectus
or
any
Permitted Free Writing Prospectus; and the certificates for the
Shares
are in due
and proper form and the holders of the Shares will not be
subject to
personal liability solely by reason of being such holders;
(j) this Agreement has been duly authorized, executed and
delivered
by the
Company;
(k) neither the Company nor any of the Subsidiaries is (A) in
violation
of its charter or by-laws, or (B) in breach or violation of or
in default
under (nor has any event oc-
<PAGE>
9
curred which with
notice, lapse of time or both would result in any breach
or
violation of, constitute a default under or give the holder of
any
indebtedness (or a person acting on such holder's behalf) the right
to
require
the repurchase, redemption or repayment of all or a part of
such
indebtedness under) (i) any indenture, mortgage, deed of trust,
bank loan
or credit
agreement or other evidence of indebtedness, or any license,
lease,
contract or other agreement or instrument to which the Company is
a
party or
by which it or any of its properties may be bound or affected,
(ii) any
federal, state, local or foreign law, regulation or rule, or
(iii) any
decree, judgment or order applicable to it or any of its
properties, except, in the case of clause (B)(i), for such
breaches,
violations
or defaults that would not result in a Material Adverse Effect;
(l) the execution, delivery and performance of this Agreement,
the
issuance
and sale of the Shares and the consummation of the transactions
contemplated hereby will not conflict with, result in any breach
or
violation
of or constitute a default under (nor constitute any event
which
with
notice, lapse of time or both, would result in any breach or
violation
of, constitute a default under or give the holder of any
indebtedness (or a person acting on such holder's behalf) the right
to
require
the repurchase, redemption or repayment of all or a part of
such
indebtedness under) (or result in the creation or imposition of a
lien,
charge or
encumbrance on any property or assets of the Company or any
Subsidiary
pursuant to) (A) the charter or by-laws of the Company or any
Subsidiary, or (B) any indenture, mortgage, deed of trust, bank
loan or
credit
agreement or other evidence of indebtedness, or any license,
lease,
contract
or other agreement or instrument to which the Company or any
Subsidiary
is a party or by which it or any of its properties may be bound
or
affected, or (C) any federal, state, local or foreign law,
regulation
or rule or
(D) any decree, judgment or order applicable to the Company or
any
Subsidiary, except, in the case of clause (B), for such
breaches,
violations
or defaults that would not result in a Material Adverse Effect;
(m) no approval, authorization, consent or order of or filing
with
any
federal, state, local or foreign governmental or regulatory
commission, board, body, authority or agency, or approval of
the
stockholders of the Company, is required in connection with the
issuance
and sale
of the Shares or the consummation by the Company of the
transactions contemplated hereby, other than (i) registration of
the
Shares
under the Act, which has been effected (or, with respect to any
registration statement to be filed hereunder pursuant to Rule
462(b) under
the Act,
will be effected in accordance herewith), (ii) any necessary
qualification under the securities or blue sky laws of the
various
jurisdictions in which the Shares are being offered by the
Underwriters or
(iii)
under the Conduct Rules of the NASD;
(n) except as described in the Registration Statement (excluding
the
exhibits
thereto), each Preliminary Prospectus and the 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 any shares of Common Stock or shares of any other
capital
stock of or other equity interests in the Company, and (iii) no
person has
the right to act as an underwriter or as a financial advisor to
the
Company in connection with the offer and sale of the Shares, in
the
case of
each of the
<PAGE>
10
foregoing
clauses (i), (ii) and (iii), whether as a result of the filing
or
effectiveness of the Registration Statement or the sale of the
Shares
as
contemplated thereby or otherwise; no person has the right,
contractual
or
otherwise, to cause the Company to register under the Act any
shares of
Common
Stock or shares of any other capital stock of or other equity
interests
in 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 Shares as contemplated thereby or otherwise;
(o) each of the Company and the Subsidiaries has all necessary
licenses,
authorizations, consents and approvals and has made all
necessary
filings required under any federal, state, local or foreign
law,
regulation
or rule, and has obtained all necessary licenses,
authorizations, consents and approvals from other persons, in order
to
conduct
its business; neither the Company nor any of the Subsidiaries
is
in
violation of, or in default under, or has received notice of
any
proceedings relating to revocation or modification of, any such
license,
authorization, consent or approval or any federal, state, local or
foreign
law,
regulation or rule or any decree, order or judgment applicable to
the
Company or
any of the Subsidiaries, including without limitation, all such
certificates, authorizations and permits required by the United
States
Food and
Drug Administration (the "FDA") or any other federal, state,
local or
foreign agencies or bodies engaged in the regulation of
pharmaceuticals or biohazardous substances or materials, except
where such
violation,
default, revocation or modification would not, individually or
in the
aggregate, have a Material Adverse Effect;
(p) all legal or governmental proceedings, affiliate
transactions,
off-balance sheet transactions, contracts, licenses, agreements,
leases or
documents
of a character required to be described in the Registration
Statement
or the Prospectus or to be filed as an exhibit to the
Registration Statement have been so described or filed as
required;
(q) there are no actions, suits, claims, investigations or
proceedings pending or, to the Company's knowledge, threatened
or
contemplated to which the Company or any of the Subsidiaries or any
of its
directors
or officers is or would be a party or of which any of its
properties
is or would be subject at law or in equity, before or by any
federal,
state, local or foreign governmental or regulatory commission,
board,
body, authority or agency, except any such action, suit, claim,
investigation or proceeding which, if resolved adversely to the
Company or
any
Subsidiary, would not, individually or in the aggregate, have a
Material
Adverse Effect or prevent or interfere with consummation of the
transactions contemplated hereby;
(r) Ernst & Young LLP, whose report on the financial statements
of
the
Company and the Subsidiaries is included in the Registration
Statement,
the Preliminary Prospectuses and the Prospectus, is an
independent registered public accounting firm as required by the
Act and
by the
rules of the Public Company Accounting Oversight Board;
(s) the audited financial statements included in the
Registration
Statement,
any Preliminary Prospectus, the Prospectus or any Permitted
Free
Writing Prospectus, together with the related notes and
schedules,
present
fairly the financial position of the Company and the
Subsidiaries
as of the
dates indicated and the results of operations, cash flows and
changes
<PAGE>
11
in
stockholders' equity of the Company and the Subsidiaries for
the
periods
specified and have been prepared in compliance with the
requirements of the Act and the Exchange Act and in conformity with
U.S.
generally
accepted accounting principles applied on a consistent basis
during the
periods involved; the other financial and statistical data
contained
in the Registration Statement, any Preliminary Prospectus, the
Prospectus
or any Permitted Free Writing Prospectus are accurately and
fairly
presented and prepared on a basis consistent with the financial
statements
and books and records of the Company and the Subsidiaries;
there are
no financial statements (historical or pro forma) that are
required
to be included in the Registration Statement, any Preliminary
Prospectus
or the Prospectus that are not included as required; the
Company
and the Subsidiaries taken as a whole do not have any material
liabilities or obligations, direct or contingent (including any
off-balance sheet obligations), not described in the
Registration
Statement
(excluding the exhibits thereto), each Preliminary Prospectus
and the
Prospectus;
(t) subsequent to the respective dates as of which information
is
given in
the Registration Statement, the Preliminary Prospectuses, the
Prospectus
and the Permitted Free Writing Prospectuses, if any, in each
case
excluding any amendments or supplements to the foregoing made
after
the
execution of this Agreement, there has not been (i) any
material
adverse
change, or any development involving a prospective material
adverse
change, in the business, properties, management, financial
condition
or results of operations of the Company and the Subsidiaries
taken as a
whole, (ii) any transaction which is material to the Company
and the
Subsidiaries taken as a whole, (iii) any obligation or
liability,
direct or
contingent (including any off-balance sheet obligations),
incurred
by the Company or any Subsidiary, which is material to the
Company
and the Subsidiaries taken as a whole, (iv) any change in the
capital
stock or outstanding indebtedness of the Company or any
Subsidiaries or (v) any dividend or distribution of any kind
declared,
paid or
made on the capital stock of the Company or any Subsidiary;
(u) the Company has obtained for the benefit of the Underwriters
the
agreement
(a "Lock-Up Agreement"), in the form set forth as Exhibit A
hereto, of
each of its directors and officers (within the meaning of Rule
16a-1(f)
under the Exchange Act), and each holder of shares of Common
Stock or
any security convertible into or exercisable or exchangeable
for
Common Stock, or
any warrant or other right to acquire shares of Common
Stock or
any such security;
(v) neither the Company nor any Subsidiary is and at no time
during
which a
prospectus is required by the Act to be delivered (whether
physically
or through compliance with Rule 172 under the Act or any
similar
rule) in connection with any sale of Shares will either of them
be, and,
after giving effect to the offering and sale of the Shares,
neither of
them will be an "investment company" or an entity "controlled"
by an
"investment company," as such terms are defined in the
Investment
Company
Act of 1940, as amended (the "Investment Company Act");
(w) the Company and each of the Subsidiaries have good and
marketable
title to all property (real and personal) described in the
Registration Statement, any Preliminary Pro-
<PAGE>
12
spectus,
the Prospectus or any Permitted Free Writing Prospectus as
being
owned by
any of them, free and clear of all liens, claims, security
interests
or other encumbrances; all the property described in the
Registration Statement, any Preliminary Prospectus, the Prospectus
or any
Permitted Free Writing
Prospectus as being held under lease by the Company
or a
Subsidiary is held thereby under valid, subsisting and
enforceable
leases;
(x) the Company and the Subsidiaries own, or have obtained valid
and
enforceable
licenses for, or other rights to use, the inventions, patent
applications, patents, trademarks (both registered and
unregistered),
tradenames, service names, copyrights, trade secrets and other
proprietary
information described in the Registration Statement, any
Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus
as
being
owned or licensed by it or which are necessary for the conduct
of
its
business as currently conducted or as proposed to be conducted
(including
the commercialization of products or services described in the
Registration Statement, any Preliminary Prospectus, the Prospectus
or any
Permitted
Free Writing Prospectus as under development) (collectively,
"Intellectual Property") except where the failure to own, license
or have
such
rights would not, individually or in the aggregate, have a
Material
Adverse
Effect; and (i) there are no third parties who have or, to the
Company's
knowledge, will be able to establish rights to any Intellectual
Property,
except for, and to the extent of, the ownership rights of the
owners of
the Intellectual Property which the Registration Statement
(excluding
the exhibits thereto), each Preliminary Prospectus and the
Prospectus
disclose is licensed to the Company, (ii) to the Company's
knowledge,
there is no infringement by third parties of any Intellectual
Property,
(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 Intellectual Property, and the Company is
unaware of
any facts which could form a reasonable basis for any such
action,
suit, proceeding or claim, (iv) there is no pending or, to the
Company's
knowledge, threatened action, suit, proceeding or claim by
others
challenging the validity, enforceability or scope of any
Intellectual Property, and the Company is unaware of any facts
which could
form a
reasonable basis for any such action, suit, proceeding or
claim,
(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, or would, upon the commercialization of any product
or
service
described in the Registration Statement, any Preliminary
Prospectus, the Prospectus or any Permitted Free Writing Prospectus
as
under
development, infringe or violate, any patent, trademark,
tradename,
service
name, copyright, trade secret or other proprietary rights of
others,
and the Company is unaware of any facts which could form a
reasonable
basis for any such action, suit, proceeding or claim, (vi) the
Company
and the Subsidiaries have complied with the terms of each
agreement
pursuant to which Intellectual Property has been licensed to
the
Company or
any Subsidiary, and all such agreements are in full force and
effect;
(vii) to the Company's knowledge there is no patent or patent
application that contains claims that interfere with the issued or
pending
claims of
any of the Intellectual Property or that challenges the
validity,
enforceability or scope of any of the Intellectual Property,
(viii) the
Company has duly and properly filed or caused to be filed with
the United
States Patent and Trademark Office (the "PTO") and applicable
foreign
and international patent authorities all patent applications
owned
by the
Company (the "Applications") (ix) the Company has complied with
the
PTO's duty
of candor and disclosure for the Applications and has made no
material
misrepresentation in the Appli-
<PAGE>
13
cations,
including the disclosure of all prior art that may render any
of
the
Applications unpatentable, (x) the Company is not aware of any
facts
material
to a determination of patentability regarding the Applications
not called
to the attention of the PTO or similar foreign authority, (xi)
the
Company is not aware of any facts not called to the attention of
the
PTO or
similar foreign authority which would preclude the grant of a
patent for
the Applications, and (xii) the Company is unaware of any facts
which
would preclude it from having clear title to the Applications;
(y) neither the Company nor any of the Subsidiaries is engaged
in
any unfair
labor practice; except for matters which would not,
individually or in the aggregate, have a Material Adverse Effect,
(i)
there is
(A) no unfair labor practice complaint pending or, to the
Company's
knowledge, threatened against the Company or any of the
Subsidiaries before the National Labor Relations Board, and no
grievance
or
arbitration proceeding arising out of or under collective
bargaining
agreements
is pending or, to the Company's knowledge, threatened, (B) no
strike, labor
dispute, slowdown or stoppage pending or, to the Company's
knowledge,
threatened against the Company or any of the Subsidiaries and
(C) no
union representation dispute currently existing concerning the
employees
of the Company or any of the Subsidiaries, and (ii) to the
Company's
knowledge, (A) no union organizing activities are currently
taking
place concerning the employees of the Company or any of the
Subsidiaries and (B) there has been no violation of any federal,
state,
local or
foreign law relating to discrimination in the hiring, promotion
or pay of
employees, any applicable wage or hour laws or any provision of
the
Employee Retirement Income Security Act of 1974 ("ERISA") or the
rules
and
regulations promulgated thereunder concerning the employees of
the
Company or
any of the Subsidiaries;
(z) the Company and the Subsidiaries and their respective
properties, assets and operations are in compliance with, and hold
all
permits,
authorizations and approvals required under, Environmental Laws
(as
defined below), except to the extent that failure to so comply or
to
hold such
permits, authorizations or approvals would not, individually or
in the aggregate, have
a Material Adverse Effect; there are no past,
present
or, to the Company's knowledge, reasonably anticipated future
events,
conditions, circumstances, activities, practices, actions,
omissions
or plans that could reasonably be expected to give rise to any
material
costs or liabilities to the Company or any Subsidiary under, or
to
interfere with or prevent compliance by the Company or any
Subsidiary
with,
Environmental Laws; except as would not, individually or in the
aggregate,
have a Material Adverse Effect, neither the Company nor any of
the
Subsidiaries (i) is the subject of any investigation, (ii) has
received
any notice or claim, (iii) is a party to or affected by any
pending
or, to its knowledge, threatened action, suit or proceeding,
(iv)
is bound
by any judgment, decree or order, and (v) has entered into any
agreement,
in each case relating to any alleged violation of any
Environmental Law or any actual or alleged release or threatened
release
or cleanup
at any location of any Hazardous Materials (as defined below)
(as used
herein, "Environmental Law" means any federal, state, local or
foreign
law, statute, ordinance, rule, regulation, order, decree,
judgment,
injunction, permit, license, authorization or other binding
requirement, or common law, relating to health, safety or the
protection,
cleanup or
restoration of the environment or natural resources, including
those relating
to the distribution, processing, generation, treatment,
storage,
disposal,
<PAGE>
14
transportation, other handling or release or threatened release
of
Hazardous
Materials, and "Hazardous Materials" means any material
(including, without limitation, pollutants, contaminants, hazardous
or
toxic
substances or wastes) that is regulated by or may give rise to
liability
under any Environmental Law);
(aa) in the ordinary course of its business, the Company and each
of
the
Subsidiaries conduct periodic reviews of the effect of the
Environmental Laws on their respective businesses, operations
and
properties, in the course of which they identify and evaluate
associated
costs and
liabilities (including, without limitation, any capital or
operating
expenditures required for cleanup, closure of properties or
compliance
with the Environmental Laws or any permit, license or approval,
any
related constraints on operating activities and any potential
liabilities to third parties);
(bb) all tax returns required to be filed by the Company or any
of
the
Subsidiaries have been filed, and all taxes and other assessments
of a
similar
nature (whether imposed directly or through withholding)
including
any
interest, additions to tax or penalties applicable thereto due
or
claimed to
be due from it have been paid, other than those being contested
in good
faith and for which adequate reserves have been provided;
(cc) the Company and each of the Subsidiaries maintain
insurance
covering
their respective properties, operations, personnel and
businesses
as the
Company reasonably deems adequate; such insurance insures
against
such
losses and risks to an extent which is adequate in accordance
with
customary
industry practice to protect the Company and the Subsidiaries
and their
respective businesses; all such insurance is fully in force on
the date
hereof and will be fully in force at the time of purchase and
any
additional
time of purchase; neither the Company nor any Subsidiary has
reason to
believe that it will not be able to renew any such insurance as
and when
such insurance expires;
(dd) neither the Company nor any of the Subsidiaries has
sustained
since the
date of the last audited financial statements included in the
Registration Statement, the Preliminary Prospectuses and the
Prospectus
any loss
or interference with its business from fire, explosion, flood
or
other
calamity, whether or not covered by insurance, or from any
labor
dispute or
court or governmental action, order or decree;
(ee) neither the Company nor any of the Subsidiaries has sent
or
received
any communication regarding termination of, or intent not to
renew, any
of the contracts or agreements referred to or described in any
Preliminary Prospectus, the Prospectus or any Permitted Free
Writing
Prospectus, or referred to or described in, or filed as an exhibit
to, the
Registration Statement, and no such termination or non-renewal has
been
threatened
by the Company or any Subsidiary or, to the Company's
knowledge,
any other party to any such contract or agreement;
(ff) the Company and each of the Subsidiaries maintain a system
of
internal
accounting controls sufficient to provide reasonable assurance
that (i)
transactions are executed in accordance with management's
general
or
specific authorization; (ii) transactions are re-
<PAGE>
15
corded as
necessary to permit preparation of financial statements in
conformity
with generally accepted accounting principles and to maintain
accountability for assets; (iii) access to assets is permitted only
in
accordance
with management's general or specific authorization; and (iv)
the
recorded accountability for assets is compared with existing assets
at
reasonable
intervals and appropriate action is taken with respect to any
differences;
(gg) the Company has established and maintains and evaluates
disclosure
controls and procedures (as such term is defined in Rule 13a-15
and 15d-15
under the Exchange Act); such disclosure controls and
procedures
are designed to ensure that material information relating to
the
Company, including its consolidated Subsidiaries, is made known to
the
Company's
Chief Executive Officer and its Chief Financial Officer by
others
within those entities, and such disclosure controls and
procedures
are
effective to perform the functions for which they were
established;
the
Company's independent auditors and the Audit Committee of the Board
of
Directors
have been advised of: (i) all significant deficiencies, if any,
in the
design or operation of internal controls which could adversely
affect the Company's
ability to record, process, summarize, and report
financial
data; and (ii) all fraud, if any, whether or not material, that
involves
management or other employees who have a role in the Company's
internal
controls; all material weaknesses, if any, in internal controls
have been
identified for the Company's auditors; since the date of the
most
recent evaluation of such disclosure controls and procedures
and
internal
controls, there have been no significant changes in internal
controls
or in other factors that could significantly affect internal
controls,
including any corrective actions with regard to significant
deficiencies and material weaknesses;
(hh) the Company and the Subsidiaries have provided you true,
correct,
and complete copies of all documentation pertaining to any
extension
of credit in the form of a personal loan made, directly or
indirectly, by the Company to any d
