Exhibit 1.1
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EXACT SCIENCES CORPORATION
(a Delaware corporation)
[number of shares] Shares of Common Stock
U.S. PURCHASE AGREEMENT
Dated: --, 2001
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EXACT SCIENCES CORPORATION
(a Delaware corporation)
[number of shares] Shares of Common Stock
(Par Value $0.01 Per Share)
U.S. PURCHASE AGREEMENT
--, 2001
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
CIBC World Markets Corp.
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC
as Representatives of the several U.S. Underwriters
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
World Financial Center, North Tower
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
EXACT Sciences Corporation, a Delaware corporation (the "COMPANY"),
confirms its agreement with ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ &
▇▇▇▇▇ Incorporated ("▇▇▇▇▇▇▇ ▇▇▇▇▇") and each of the other underwriters named in
Schedule A hereto (collectively, the "U.S. UNDERWRITERS", which term shall also
include any underwriter substituted as hereinafter provided in Section 10
hereof), for whom ▇▇▇▇▇▇▇ ▇▇▇▇▇, CIBC World Markets Corp. and ▇▇▇▇▇▇ ▇▇▇▇▇▇
Partners LLC are acting as representatives (in such capacity, the
"REPRESENTATIVES"), with respect to the issue and sale by the Company and the
purchase by the U.S. Underwriters, acting severally and not jointly, of the
respective numbers of shares of Common Stock, par value $0.01 per share, of the
Company ("COMMON STOCK") set forth in said Schedule A, and with respect to the
grant by the Company to the U.S. Underwriters, acting severally and not jointly,
of the option described in Section 2(b) hereof to purchase all or any part of
[number of over-allotment shares] additional shares of Common Stock to cover
over-allotments, if any. The aforesaid [number of shares] shares of Common Stock
(the "INITIAL U.S. SECURITIES") to be purchased by the U.S. Underwriters and all
or any part of the [number of over-allotment shares] shares of Common Stock
subject to the option described in Section 2(b) hereof (the "U.S. OPTION
SECURITIES") are hereinafter called, collectively, the "U.S. SECURITIES".
It is understood that the Company is concurrently entering into an
agreement dated the date hereof (the "INTERNATIONAL PURCHASE AGREEMENT")
providing for the offering by the Company
of an aggregate of [number of International Shares] shares of Common Stock (the
"INITIAL INTERNATIONAL SECURITIES") through arrangements with ▇▇▇▇▇▇▇ ▇▇▇▇▇
International, CIBC World Markets plc. and ▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC
(collectively, the "INTERNATIONAL MANAGERS") and the grant by the Company to the
International Managers, acting severally and not jointly, of an option to
purchase all or any part of the International Managers' pro rata portion of up
to [number of International Over-allotment Shares] additional shares of Common
Stock solely to cover over-allotments, if any (the "INTERNATIONAL OPTION
SECURITIES" and, together with the U.S. Option Securities, the "OPTION
SECURITIES"). The Initial International Securities and the International Option
Securities are hereinafter called the "INTERNATIONAL SECURITIES". It is
understood that the Company is not obligated to sell, and the U.S. Underwriters
are not obligated to purchase, any Initial U.S. Securities unless all of the
Initial International Securities are contemporaneously purchased by the
International Managers.
The U.S. Underwriters and the International Managers are hereinafter
collectively called the "UNDERWRITERS", the Initial U.S. Securities and the
Initial International Securities are hereinafter collectively called the
"INITIAL SECURITIES", and the U.S. Securities and the International Securities
are hereinafter collectively called the "SECURITIES".
The Underwriters will concurrently enter into an Intersyndicate Agreement
of even date herewith (the "INTERSYNDICATE AGREEMENT") providing for the
coordination of certain transactions among the Underwriters under the direction
of ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated (in
such capacity, the "GLOBAL COORDINATOR").
The Company understands that the U.S. Underwriters propose to make a
public offering of the U.S. Securities as soon as the Representatives deem
advisable after this Agreement has been executed and delivered.
The Company and the U.S. Underwriters agree that up to o shares of the
Initial U.S. Securities to be purchased by the U.S. Underwriters and up to o
shares of the Initial International Securities to be purchased by the
International Managers (collectively, the "RESERVED SECURITIES") shall be
reserved for sale by the Underwriters to certain eligible directors, officers,
employees and business associates of the Company and related persons, as part of
the distribution of the Securities by the Underwriters, subject to the terms of
this Agreement, the applicable rules, regulations and interpretations of the
National Association of Securities Dealers, Inc. and all other applicable laws,
rules and regulations. To the extent that such Reserved Securities are not
orally confirmed for purchase by such eligible directors, officers, employees
and business associates of the Company and related persons by the end of the
first business day after the date of this Agreement, such Reserved Securities
may be offered to the public as part of the public offering contemplated hereby.
The Company has filed with the Securities and Exchange Commission (the
"COMMISSION") a registration statement on Form S-1 (No. 333-48812) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 ACT"), including the related preliminary prospectus or prospectuses.
Promptly after execution and delivery of this
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Agreement, the Company will either (i) prepare and file a prospectus in
accordance with the provisions of Rule 430A ("RULE 430A") of the rules and
regulations of the Commission under the 1933 Act (the "1933 ACT REGULATIONS")
and paragraph (b) of Rule 424 ("RULE 424(b)") of the 1933 Act Regulations or
(ii) if the Company has elected to rely upon Rule 434 ("RULE 434") of the 1933
Act Regulations, prepare and file a term sheet (a "TERM SHEET") in accordance
with the provisions of Rule 434 and Rule 424(b). Two forms of prospectus are to
be used in connection with the offering and sale of the Securities: one relating
to the U.S. Securities (the "FORM OF U.S. PROSPECTUS") and one relating to the
International Securities (the "FORM OF INTERNATIONAL PROSPECTUS"). The Form of
U.S. Prospectus is identical to the Form of International Prospectus, except for
the front cover and back cover pages and the information under the caption
"Underwriting". The information included in any such prospectus or in any such
Term Sheet, as the case may be, that was omitted from such registration
statement at the time it became effective but that is deemed to be part of such
registration statement at the time it became effective (a) pursuant to paragraph
(b) of Rule 430A is referred to as "RULE 430A INFORMATION" or (b) pursuant to
paragraph (d) of Rule 434 is referred to as "RULE 434 INFORMATION." Each Form of
U.S. Prospectus and Form of International Prospectus used before such
registration statement became effective, and any prospectus that omitted, as
applicable, the Rule 430A Information or the Rule 434 Information, that was used
after such effectiveness and prior to the execution and delivery of this
Agreement, is herein called a "PRELIMINARY PROSPECTUS." Such registration
statement, including the exhibits thereto and schedules thereto at the time it
became effective and including the Rule 430A Information and the Rule 434
Information, as applicable, is herein called the "REGISTRATION STATEMENT." Any
registration statement filed pursuant to Rule 462(b) of the 1933 Act Regulations
is herein referred to as the "RULE 462(b) REGISTRATION STATEMENT," and after
such filing the term "REGISTRATION STATEMENT" shall include the Rule 462(b)
Registration Statement. The final Form of U.S. Prospectus and the final Form of
International Prospectus in the forms first furnished to the Underwriters for
use in connection with the offering of the Securities are herein called the
"U.S. PROSPECTUS" and the "INTERNATIONAL PROSPECTUS", respectively, and
collectively, the "PROSPECTUSES". If Rule 434 is relied on, the terms "U.S.
Prospectus" and "International Prospectus" shall refer to the preliminary U.S.
Prospectus dated ___, 2001 and the preliminary International Prospectus dated
___, 2001, respectively, each together with the applicable Term Sheet and all
references in this Agreement to the date of such Prospectus shall mean the date
of the applicable Term Sheet. For purposes of this Agreement, all references to
the Registration Statement, any preliminary prospectus, the U.S. Prospectus, the
International Prospectus or any Term Sheet or any amendment or supplement to any
of the foregoing shall be deemed to include the copy filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval system
("▇▇▇▇▇").
SECTION 1. Representations and Warranties.
(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY. The Company represents
and warrants to each U.S. Underwriter as of the date hereof, as of the Closing
Time referred to in Section 2(c) hereof, and as of each Date of Delivery (if
any) referred to in Section 2(b) hereof, and agrees with each U.S. Underwriter,
as follows:
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(i) COMPLIANCE WITH REGISTRATION REQUIREMENTS. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act, and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act, and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments thereto
became effective and at the Closing Time (and, if any U.S. Option
Securities are purchased, at the Date of Delivery), the Registration
Statement, the Rule 462(b) Registration Statement and any amendments and
supplements thereto complied and will comply in all material respects
with the requirements of the 1933 Act and the 1933 Act Regulations and
did not and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading, and the Prospectuses, any
preliminary prospectuses and any supplement thereto or prospectus wrapper
prepared in connection therewith, at their respective times of issuance
and at the Closing Time, complied and will comply in all material
respects with any applicable laws or regulations of foreign jurisdictions
in which the Prospectuses and such preliminary prospectuses, as amended
or supplemented, if applicable, are distributed in connection with the
offer and sale of Reserved Securities. Neither of the Prospectuses nor
any amendments or supplements thereto (including any prospectus wrapper),
at the time the Prospectuses or any amendments or supplements thereto
were issued and at the Closing Time (and, if any U.S. Option Securities
are purchased, at the Date of Delivery), included or will include an
untrue statement of a material fact or omitted or will omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading. If
Rule 434 is used, the Company will comply with the requirements of Rule
434 and the Prospectuses shall not be "materially different", as such
term is used in Rule 434, from the prospectuses included in the
Registration Statement at the time it became effective. The
representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement or the U.S.
Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by any U.S. Underwriter through the
Representatives expressly for use in the Registration Statement or the
U.S. Prospectus.
Each preliminary prospectus and the prospectuses filed as part of
the Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the 1933 Act,
complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectuses
delivered to the Underwriters for use in connection with this offering
was identical to the electronically transmitted copies thereof filed with
the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by
Regulation S-T.
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(ii) INDEPENDENT ACCOUNTANTS. The accountants who certified the
financial statements and supporting schedules included in the
Registration Statement are independent public accountants as required by
the 1933 Act and the 1933 Act Regulations.
(iii) FINANCIAL STATEMENTS. The financial statements included in
the Registration Statement and the Prospectuses, together with the
related schedules and notes, present fairly the financial position of the
Company at the dates indicated and the statement of operations,
stockholders' equity and cash flows of the Company for the periods
specified; said financial statements have been prepared in conformity
with generally accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved except as disclosed
therein. The supporting schedules included in the Registration Statement
present fairly in accordance with GAAP the information required to be
stated therein. The selected financial data and the summary financial
information included in the Prospectuses present fairly the information
shown therein and have been compiled on a basis consistent with that of
the audited financial statements or the unaudited financial statements,
as the case may be, to which such selected financial data and summary
financial information relates. The pro forma financial statements and the
related notes thereto included in the Registration Statement and the
Prospectuses present fairly the information shown therein, have been
prepared in accordance with the Commission's rules and guidelines with
respect to pro forma financial statements and have been properly compiled
on the bases described therein, and the assumptions used in the
preparation thereof are reasonable and the adjustments used therein are
appropriate to give effect to the transactions and circumstances referred
to therein.
(iv) NO MATERIAL ADVERSE CHANGE IN BUSINESS. Since the respective
dates as of which information is given in the Registration Statement and
the Prospectuses, except as otherwise stated therein, (A) there has been
no material adverse change in the condition, financial or otherwise, or
in the earnings, business affairs or business prospects of the Company
and its subsidiary considered as one enterprise, whether or not arising
in the ordinary course of business (a "MATERIAL ADVERSE EFFECT"), (B)
there have been no transactions entered into by the Company or its
subsidiary, other than those in the ordinary course of business, which
are material with respect to the Company and its subsidiary considered as
one enterprise, and (C) there has been no dividend or distribution of any
kind declared, paid or made by the Company on any class of its capital
stock.
(v) GOOD STANDING OF THE COMPANY. The Company has been duly
organized and is validly existing as a corporation in good standing under
the laws of the State of Delaware and has corporate power and authority
to own, lease and operate its properties and to conduct its business as
described in the Prospectuses and to enter into and perform its
obligations under this Agreement; and the Company is duly qualified as a
foreign corporation to transact business and is in good standing in each
other jurisdiction in
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which such qualification is required, whether by reason of the ownership
or leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result in a
Material Adverse Effect.
(vi) GOOD STANDING OF SUBSIDIARY. The Company's subsidiary, the
EXACT Sciences Securities Corporation (the "SUBSIDIARY"), has been duly
organized and is validly existing as a corporation in good standing under
the laws of the jurisdiction of its incorporation, has corporate power
and authority to own, lease and operate its properties and to conduct its
business as described in the Prospectuses and is duly qualified as a
foreign corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good standing would
not result in a Material Adverse Effect; except as otherwise disclosed in
the Registration Statement, all of the issued and outstanding capital
stock of the Subsidiary has been duly authorized and validly issued, is
fully paid and non-assessable and is owned by the Company, free and clear
of any security interest, mortgage, pledge, lien, encumbrance, claim or
equity; none of the outstanding shares of capital stock of the Subsidiary
was issued in violation of the preemptive or similar rights of any
securityholder of the Subsidiary.
(vii) CAPITALIZATION. The authorized, issued and outstanding
capital stock of the Company is as set forth in the Prospectuses in the
column entitled "Actual" under the caption "Capitalization" (except for
subsequent issuances, if any, pursuant to this Agreement, pursuant to
reservations, agreements or employee benefit plans referred to in the
Prospectuses or pursuant to the exercise of convertible securities or
options referred to in the Prospectuses). The shares of issued and
outstanding capital stock of the Company have been duly authorized and
validly issued and are fully paid and non-assessable; none of the
outstanding shares of capital stock of the Company was issued in
violation of the preemptive or other similar rights of any securityholder
of the Company.
(viii) AUTHORIZATION OF AGREEMENT. This Agreement and the
International Purchase Agreement have been duly authorized, executed and
delivered by the Company.
(ix) AUTHORIZATION AND DESCRIPTION OF SECURITIES. The Securities
to be purchased by the U.S. Underwriters and the International Managers
from the Company have been duly authorized for issuance and sale to the
U.S. Underwriters pursuant to this Agreement and the International
Managers pursuant to the International Purchase Agreement, respectively,
and, when issued and delivered by the Company pursuant to this Agreement
and the International Purchase Agreement, respectively, against payment
of the consideration set forth herein and in the International Purchase
Agreement, respectively, will be validly issued, fully paid and
non-assessable; the Common Stock conforms to all statements relating
thereto contained in the Prospectuses and such description conforms to
the rights set forth in the instruments defining the same; no
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holder of the Securities will be subject to personal liability by reason
of being such a holder; and the issuance of the Securities is not subject
to the preemptive or other similar rights of any securityholder of the
Company.
(x) ABSENCE OF DEFAULTS AND CONFLICTS. Neither the Company nor the
Subsidiary is in violation of its charter or by-laws or in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, deed of trust,
loan or credit agreement, note, lease or other agreement or instrument to
which the Company or the Subsidiary is a party or by which it may be
bound, or to which any of the property or assets of the Company or the
Subsidiary is subject (collectively, "AGREEMENTS AND INSTRUMENTS") except
for such defaults that would not result in a Material Adverse Effect; and
the execution, delivery and performance of this Agreement and the
International Purchase Agreement and the consummation of the transactions
contemplated in this Agreement, the International Purchase Agreement and
in the Registration Statement (including the issuance and sale of the
Securities and the use of the proceeds from the sale of the Securities as
described in the Prospectuses under the caption "Use of Proceeds") and
compliance by the Company with its obligations under this Agreement and
the International Purchase Agreement have been duly authorized by all
necessary corporate action and do not and will not, whether with or
without the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined below)
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or the Subsidiary
pursuant to, the Agreements and Instruments (except for such conflicts,
breaches or defaults or liens, charges or encumbrances that would not
result in a Material Adverse Effect), nor will such action result in any
violation of the provisions of the charter or by-laws of the Company or
the Subsidiary or any applicable law, statute, rule, regulation,
judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over
the Company, the Subsidiary or any of their assets, properties or
operations. As used herein, a "REPAYMENT EVENT" means any event or
condition which gives the holder of any note, debenture or other evidence
of indebtedness (or any person acting on such holder's behalf) the right
to require the repurchase, redemption or repayment of all or a portion of
such indebtedness by the Company or the Subsidiary.
(xi) ABSENCE OF LABOR DISPUTE. No labor dispute with the employees
of the Company or the Subsidiary exists or, to the knowledge of the
Company, is imminent, and the Company is not aware of any existing or
imminent labor disturbance by the employees of any of its or the
Subsidiary's principal suppliers, manufacturers, customers or
contractors, which, in either case, may reasonably be expected to result
in a Material Adverse Effect.
(xii) ABSENCE OF PROCEEDINGS. There is no action, suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or, to the
knowledge of the Company, threatened, against or
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affecting the Company or the Subsidiary, which is required to be
disclosed in the Registration Statement (other than as disclosed
therein), or which might reasonably be expected to result in a Material
Adverse Effect, or which might reasonably be expected to materially and
adversely affect the properties or assets thereof or the consummation of
the transactions contemplated in this Agreement and the International
Purchase Agreement or the performance by the Company of its obligations
hereunder or thereunder; the aggregate of all pending legal or
governmental proceedings to which the Company or the Subsidiary is a
party or of which any of their respective property or assets is the
subject which are not described in the Registration Statement, including
ordinary routine litigation incidental to the business, could not
reasonably be expected to result in a Material Adverse Effect.
(xiii) ACCURACY OF EXHIBITS. There are no contracts or documents
which are required to be described in the Registration Statement or the
Prospectuses or to be filed as exhibits thereto which have not been so
described and filed as required.
(xiv) POSSESSION OF INTELLECTUAL PROPERTY. The Company and the
Subsidiary own or possess, or can acquire on reasonable terms, adequate
patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets and other unpatented and/or unpatentable
proprietary or confidential information, systems or procedures),
trademarks, service marks, trade names or other intellectual property
(collectively, "INTELLECTUAL PROPERTY") necessary to carry on the
business now operated by them, and neither the Company nor the Subsidiary
has received any notice or is otherwise aware of any infringement of or
conflict with asserted rights of others with respect to any Intellectual
Property except as disclosed in the Registration Statement or of any
facts or circumstances which would render any Intellectual Property
invalid or inadequate to protect the interest of the Company or the
Subsidiary therein, and which infringement or conflict (if the subject of
any unfavorable decision, ruling or finding) or invalidity or inadequacy,
singly or in the aggregate, would result in a Material Adverse Effect.
(xv) ABSENCE OF FURTHER REQUIREMENTS. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required for the performance by the Company of its
obligations hereunder, in connection with the offering, issuance or sale
of the Securities under this Agreement and the International Purchase
Agreement or the consummation of the transactions contemplated by this
Agreement and the International Purchase Agreement, except (i) such as
have been already obtained or as may be required under the 1933 Act or
the 1933 Act Regulations and foreign or state securities or blue sky laws
and (ii) such as have been obtained under the laws and regulations of
jurisdictions outside the United States in which the Reserved Securities
are offered.
(xvi) POSSESSION OF LICENSES AND PERMITS. The Company and the
Subsidiary possess such permits, licenses, approvals, consents and other
authorizations (collectively, "GOVERNMENTAL LICENSES") issued by the
appropriate federal, state, local or foreign
8
regulatory agencies or bodies necessary to conduct the business now
operated by them; the Company and the Subsidiary are in compliance with
the terms and conditions of all such Governmental Licenses, except where
the failure so to comply would not, singly or in the aggregate, have a
Material Adverse Effect; all of the Governmental Licenses are valid and
in full force and effect, except when the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full force
and effect would not have a Material Adverse Effect; and neither the
Company nor the Subsidiary has received any notice of proceedings
relating to the revocation or modification of any such Governmental
Licenses which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a Material
Adverse Effect.
(xvii) TITLE TO PROPERTY. The Company and the Subsidiary own no
real property. The Company and the Subsidiary have good title to all
personal properties owned by the Company and the Subsidiary, free and
clear of all mortgages, pledges, liens, security interests, claims,
restrictions or encumbrances of any kind except such as (a) are described
in the Prospectuses or (b) do not, singly or in the aggregate, materially
affect the value of such property and do not materially interfere with
the use made and proposed to be made of such property by the Company or
the Subsidiary; and all of the leases and subleases material to the
business of the Company and the Subsidiary, considered as one enterprise,
and under which the Company or the Subsidiary holds properties described
in the Prospectuses, are in full force and effect, and neither the
Company nor the Subsidiary has any notice of any material claim of any
sort that has been asserted by anyone adverse to the rights of the
Company or the Subsidiary under any of the leases or subleases mentioned
above, or affecting or questioning the rights of the Company or the
Subsidiary to the continued possession of the leased or subleased
premises under any such lease or sublease.
(xviii) INVESTMENT COMPANY ACT. The Company is not, and upon the
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the
Prospectuses will not 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 "1940 ACT").
(xix) ENVIRONMENTAL LAWS. Except as described in the Registration
Statement and except as would not, singly or in the aggregate, result in
a Material Adverse Effect, (A) neither the Company nor the Subsidiary is
in violation of any federal, state, local or foreign statute, law, rule,
regulation, ordinance, code, policy or rule of common law or any judicial
or administrative interpretation thereof, including any judicial or
administrative order, consent, decree or judgment, relating to pollution
or protection of human health, the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without limitation, laws and
regulations relating to the release or threatened release of chemicals,
pollutants, contaminants, wastes, toxic substances, hazardous substances,
petroleum or petroleum products (collectively, "HAZARDOUS MATERIALS") or
to the manufacture, processing,
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distribution, use, treatment, storage, disposal, transport or handling of
Hazardous Materials (collectively, "ENVIRONMENTAL LAWS"), (B) the Company
and the Subsidiary have all permits, authorizations and approvals
required under any applicable Environmental Laws and are each in
compliance with their requirements, (C) there are no pending or, to the
best knowledge of the Company, threatened administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, notices
of noncompliance or violation, investigation or proceedings relating to
any Environmental Law against the Company or the Subsidiary and (D) there
are no events or circumstances that might reasonably be expected to form
the basis of an order for clean-up or remediation, or an action, suit or
proceeding by any private party or governmental body or agency, against
or affecting the Company or the Subsidiary relating to Hazardous
Materials or any Environmental Laws.
(xx) REGISTRATION RIGHTS. Except as disclosed in the Registration
Statement, there are no persons with registration rights or other similar
rights to have any securities registered pursuant to the Registration
Statement or otherwise registered by the Company under the 1933 Act.
(b) OFFICER'S CERTIFICATES. Any certificate signed by any officer of the
Company or the Subsidiary delivered to the Global Coordinator, Representatives
or to counsel for the U.S. Underwriters shall be deemed a representation and
warranty by the Company to each U.S. Underwriter as to the matters covered
thereby.
SECTION 2. SALE AND DELIVERY TO U.S. UNDERWRITERS; CLOSING.
(a) INITIAL SECURITIES. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company agrees to sell to each U.S. Underwriter, severally and not
jointly, and each U.S. Underwriter, severally and not jointly, agrees to
purchase from the Company, at the price per share set forth in Schedule B, the
number of Initial U.S. Securities set forth in Schedule A opposite the name of
such U.S. Underwriter, plus any additional number of Initial U.S. Securities
which such U.S. Underwriter may become obligated to purchase pursuant to the
provisions of Section 10 hereof.
(b) OPTION SECURITIES. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the U.S. Underwriters,
severally and not jointly, to purchase up to an additional [number of
over-allotment shares] shares of Common Stock at the price per share set forth
in Schedule B, less an amount per share equal to any dividends or distributions
declared by the Company and payable on the Initial U.S. Securities but not
payable on the U.S. Option Securities. The option hereby granted will expire 30
days after the date hereof and may be exercised in whole or in part from time to
time only for the purpose of covering over-allotments which may be made in
connection with the offering and distribution of the Initial U.S. Securities
upon notice by the Global Coordinator to the Company setting forth the number of
U.S. Option Securities as to which the several Underwriters are then exercising
the option and the time and
10
date of payment and delivery for such U.S. Option Securities. Any such time and
date of delivery for the U.S. Option Securities (a "DATE OF Delivery") shall be
determined by the Global Coordinator, but shall not be later than seven full
business days after the exercise of said option, nor in any event prior to the
Closing Time, as hereinafter defined. If the option is exercised as to all or
any portion of the U.S. Option Securities, each of the U.S. Underwriters, acting
severally and not jointly, will purchase that proportion of the total number of
U.S. Option Securities then being purchased which the number of Initial U.S.
Securities set forth in Schedule A opposite the name of such U.S. Underwriter
bears to the total number of Initial U.S. Securities, subject in each case to
such adjustments as the Global Coordinator in its discretion shall make to
eliminate any sales or purchases of fractional shares.
(c) PAYMENT. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of
Shearman & Sterling, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or at such
other place as shall be agreed upon by the Global Coordinator and the Company,
at 9:00 A.M. (Eastern time) on the third (fourth, if the pricing occurs after
4:30 P.M. (Eastern time) on any given day) business day after the date hereof
(unless postponed in accordance with the provisions of Section 10), or such
other time not later than ten business days after such date as shall be agreed
upon by the Global Coordinator and the Company (such time and date of payment
and delivery being herein called "CLOSING TIME").
In addition, in the event that any or all of the U.S. Option Securities
are purchased by the U.S. Underwriters, payment of the purchase price for, and
delivery of certificates for, such U.S. Option Securities shall be made at the
above-mentioned offices, or at such other place as shall be agreed upon by the
Global Coordinator and the Company, on each Date of Delivery as specified in the
notice from the Global Coordinator to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the Representatives for the respective accounts of the U.S. Underwriters of
certificates for the U.S. Securities to be purchased by them. It is understood
that each U.S. Underwriter has authorized the Representatives, for its account,
to accept delivery of, receipt for, and make payment of the purchase price for,
the Initial U.S. Securities and the U.S. Option Securities, if any, which it has
agreed to purchase. ▇▇▇▇▇▇▇ ▇▇▇▇▇, individually and not as representative of the
U.S. Underwriters, may (but shall not be obligated to) make payment of the
purchase price for the Initial U.S. Securities or the U.S. Option Securities, if
any, to be purchased by any U.S. Underwriter whose funds have not been received
by the Closing Time or the relevant Date of Delivery, as the case may be, but
such payment shall not relieve such U.S. Underwriter from its obligations
hereunder.
(d) DENOMINATIONS; REGISTRATION. Certificates for the Initial U.S.
Securities and the U.S. Option Securities, if any, shall be in such
denominations and registered in such names as the Representatives may request in
writing at least one full business day before the Closing Time or the relevant
Date of Delivery, as the case may be. The certificates for the Initial U.S.
Securities and the U.S. Option Securities, if any, will be made available for
examination and packaging by
11
the Representatives in New York City not later than 10:00 A.M. (Eastern time) on
the business day prior to the Closing Time or the relevant Date of Delivery, as
the case may be.
SECTION 3. COVENANTS OF THE COMPANY. The Company covenants with each U.S.
Underwriter as follows:
(a) COMPLIANCE WITH SECURITIES REGULATIONS AND COMMISSION
REQUESTS. The Company, subject to Section 3(b), will comply with the
requirements of Rule 430A or Rule 434, as applicable, and will notify the
Global Coordinator immediately, and confirm the notice in writing, (i)
when any post-effective amendment to the Registration Statement shall
become effective, or any supplement to the Prospectuses or any amended
Prospectuses shall have been filed, (ii) of the receipt of any comments
from the Commission, (iii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement to
the Prospectuses or for additional information, and (iv) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or suspending the use
of any preliminary prospectus, or of the initiation or threatening of any
proceedings for any of such purposes. The Company will promptly effect
the filings necessary pursuant to Rule 424(b) and will take such steps as
it deems necessary to ascertain promptly whether the form of prospectus
transmitted for filing under Rule 424(b) was received for filing by the
Commission and, in the event that it was not, it will promptly file such
prospectus. The Company will make every reasonable effort to prevent the
issuance of any stop order and, if any stop order is issued, to obtain
the lifting thereof at the earliest possible moment.
(b) FILING OF AMENDMENTS. The Company will give the Global
Coordinator notice of its intention to file or prepare any amendment to
the Registration Statement (including any filing under Rule 462(b)), any
Term Sheet or any amendment, supplement or revision to either any
prospectus included in the Registration Statement at the time it became
effective or to the Prospectuses, will furnish the Global Coordinator
with copies of any such documents a reasonable amount of time prior to
such proposed filing or use, as the case may be, and will not file or use
any such document to which the Global Coordinator or counsel for the U.S.
Underwriters shall reasonably object.
(c) DELIVERY OF REGISTRATION STATEMENTS. The Company has furnished
or will deliver to the Representatives and counsel for the U.S.
Underwriters, without charge, signed copies of the Registration Statement
as originally filed and of each amendment thereto (including exhibits
filed therewith or incorporated by reference therein) and signed copies
of all consents and certificates of experts, and will also deliver to the
Representatives, without charge, a conformed copy of the Registration
Statement as originally filed and of each amendment thereto (without
exhibits) for each of the U.S. Underwriters. The copies of the
Registration Statement and each amendment thereto furnished to the U.S.
Underwriters will be identical to the electronically transmitted
12
copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the
extent permitted by Regulation S-T.
(d) DELIVERY OF PROSPECTUSES. The Company has delivered to each
U.S. Underwriter, without charge, as many copies of each preliminary
prospectus as such U.S. Underwriter has reasonably requested, and the
Company hereby consents to the use of such copies for purposes permitted
by the 1933 Act. The Company will furnish to each U.S. Underwriter,
without charge, during the period when the U.S. Prospectus is required to
be delivered under the 1933 Act or the Securities Exchange Act of 1934
(the "1934 ACT"), such number of copies of the U.S. Prospectus (as
amended or supplemented) as such U.S. Underwriter may reasonably request.
The U.S. Prospectus and any amendments or supplements thereto furnished
to the U.S. Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇,
except to the extent permitted by Regulation S-T.
(e) CONTINUED COMPLIANCE WITH SECURITIES LAWS. The Company will
comply with the 1933 Act and the 1933 Act Regulations so as to permit the
completion of the distribution of the Securities as contemplated in this
Agreement and the International Purchase Agreement and in the
Prospectuses. If at any time when a prospectus is required by the 1933
Act to be delivered in connection with sales of the Securities, any event
shall occur or condition shall exist as a result of which it is
necessary, in the opinion of counsel for the U.S. Underwriters or for the
Company, to amend the Registration Statement or amend or supplement any
Prospectus in order that the Prospectuses will not include any untrue
statements of a material fact or omit to state a material fact necessary
in order to make the statements therein not misleading in the light of
the circumstances existing at the time any such Prospectus is delivered
to a purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or amend or
supplement any Prospectus in order to comply with the requirements of the
1933 Act or the 1933 Act Regulations, the Company will promptly prepare
and file with the Commission, subject to Section 3(b), such amendment or
supplement as may be reasonably necessary to correct such statement or
omission or to make the Registration Statement or the Prospectuses comply
with such requirements, and the Company will furnish to the U.S.
Underwriters such number of copies of such amendment or supplement as the
U.S. Underwriters may reasonably request.
(f) BLUE SKY QUALIFICATIONS. The Company will use its best
efforts, in cooperation with the U.S. Underwriters, to qualify the
Securities for offering and sale under the applicable securities laws of
such states and other jurisdictions (domestic or foreign) as the Global
Coordinator may designate and to maintain such qualifications in effect
for a period of not less than one year from the later of the effective
date of the Registration Statement and any Rule 462(b) Registration
Statement; PROVIDED, HOWEVER, that the Company shall not be obligated to
file any general consent to service of process or to qualify as a foreign
corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in
13
any jurisdiction in which it is not otherwise so subject. In each
jurisdiction in which the Securities have been so qualified, the Company
will file such statements and reports as may be required by the laws of
such jurisdiction to continue such qualification in effect for a period
of not less than one year from the effective date of the Registration
Statement and any Rule 462(b) Registration Statement.
(g) RULE 158. The Company will timely file such reports pursuant
to the 1934 Act as are necessary in order to make generally available to
its securityholders as soon as practicable an earnings statement for the
purposes of, and to provide the benefits contemplated by, the last
paragraph of Section 11(a) of the 1933 Act.
(h) USE OF PROCEEDS. The Company will use the net proceeds
received by it from the sale of the Securities in the manner specified in
the Prospectuses under "Use of Proceeds."
(i) LISTING. The Company will use its best efforts to effect and
maintain the quotation of the Securities on the Nasdaq National Market
and will file with the Nasdaq National Market all documents and notices
required by the Nasdaq National Market of companies that have securities
that are traded in the over-the-counter market and quotations for which
are reported by the Nasdaq National Market.
(j) RESTRICTION ON SALE OF SECURITIES. During the period
commencing on the date of this Agreement (the "COMMENCEMENT DATE") and
ending 180 days thereafter, the Company will not, without the prior
written consent of the Global Coordinator, (i) directly or indirectly,
offer, pledge, sell, contract to sell, sell any option or contract to
purchase, purchase any option or contract to sell, grant any option,
right or warrant to purchase or otherwise transfer or dispose of any
share of Common Stock or any securities convertible into or exercisable
or exchangeable for Common Stock or file any registration statement under
the 1933 Act with respect to any of the foregoing or (ii) enter into any
swap or any other agreement or any transaction that transfers, in whole
or in part, directly or indirectly, the economic consequence of ownership
of the Common Stock, whether any such swap or transaction described in
clause (i) or (ii) above is to be settled by delivery of Common Stock or
such other securities, in cash or otherwise; PROVIDED, HOWEVER, the
Company may issue shares of Common Stock or other securities convertible
into or exercisable or exchangeable for shares of Common Stock in
connection with strategic business relationships, including marketing and
distribution business relationships, only if such transferee executes and
delivers to ▇▇▇▇▇▇▇ ▇▇▇▇▇ an agreement in the same form and content, and
with the same expiration date, as the form of lock-up agreement attached
hereto as Exhibit C-1 or Exhibit C-2, as the case may be. The foregoing
sentence shall not apply to (A) any shares of Common Stock issued by the
Company upon the exercise of an option or warrant or the conversion of a
security outstanding on the date hereof and referred to in the
Prospectuses or (B) any shares of Common Stock issued or options to
purchase Common Stock granted pursuant to existing
14
employee benefit plans of the Company referred to in the Prospectuses and
any registration statements filed related thereto.
(k) REPORTING REQUIREMENTS. The Company, during the period when
the Prospectuses are required to be delivered under the 1933 Act or the
1934 Act, will file all documents required to be filed with the
Commission pursuant to the 1934 Act within the time periods required by
the 1934 Act and the rules and regulations of the Commission thereunder.
(l) COMPLIANCE WITH NASD RULES. The Company hereby agrees that it
will ensure that the Reserved Securities will be restricted as required
by the National Association of Securities Dealers, Inc. (the "NASD") or
the NASD rules from sale, transfer, assignment, pledge or hypothecation
for a period of three months following the date of this Agreement. The
Underwriters will notify the Company as to which persons will need to be
so restricted. At the request of the Underwriters, the Company will
direct the transfer agent to place a stop transfer restriction upon such
securities for such period of time. Should the Company release, or seek
to release, from such restrictions any of the Reserved Securities, the
Company agrees to reimburse the Underwriters for any reasonable expenses
(including, without limitation, legal expenses) they incur in connection
with such release.
(m) COMPLIANCE WITH RULE 463. The Company will include in its
periodic reports filed with the Commission pursuant to the 1934 Act such
information as may be required pursuant to Rule 463 of the 1933 Act
Regulations.
SECTION 4. PAYMENT OF EXPENSES.
(a) EXPENSES. The Company will pay all expenses incident to the
performance of its obligations under this Agreement, including (i) the
preparation, printing and filing of the Registration Statement (including
financial statements and exhibits) as originally filed and of each amendment
thereto, (ii) the preparation, printing and delivery to the U.S. Underwriters
of this Agreement, any Agreement among Underwriters and such other documents
as may be required in connection with the offering, purchase, sale, issuance
or delivery of the Securities, (iii) the preparation, issuance and delivery
of the certificates for the Securities to the Underwriters, including any
stock or other transfer taxes and any stamp or other duties payable upon the
sale, issuance or delivery of the Securities to the Underwriters and the
transfer of the Securities between the U.S. Underwriters and the
International Managers, (iv) the fees and disbursements of the Company's
counsel, accountants and other advisors, (v) the filing fees incident to any
necessary filings under state securities laws and the reasonable fees and
disbursements of counsel for the Underwriters in connection therewith and in
connection with the preparation of the Blue Sky Survey and any supplement
thereto (which shall not exceed $5,000), (vi) the printing and delivery to
the U.S. Underwriters of copies of each preliminary prospectus, any Term
Sheets and of the Prospectuses and any amendments or supplements thereto,
(vii) the preparation, printing and delivery to the Underwriters of copies of
the Blue Sky Survey and any supplement thereto, (viii) the fees and expenses
of any transfer agent or registrar for the Securities, and (ix) the filing
fees incident to, and the reasonable fees and disbursements
15
of counsel to the Underwriters in connection with, the review by the NASD of the
terms of the sale of the Securities, (x) the fees and expenses incurred in
connection with the inclusion of the Securities in the Nasdaq National Market
and (xi) all costs and expenses of the Underwriters, including the fees and
disbursements of counsel for the Underwriters, in connection with matters
related to the Reserved Securities which are designated by the Company for sale
to eligible directors, officers, employees and business associates of the
Company and related persons.
(b) TERMINATION OF AGREEMENT. If this Agreement is terminated by the
Representatives in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the Company shall reimburse the U.S. Underwriters for all of
their out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the U.S. Underwriters.
SECTION 5. CONDITIONS OF U.S. UNDERWRITERS' OBLIGATIONS. The obligations
of the several U.S. Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company contained in Section 1 hereof or
in certificates of any officer of the Company or the Subsidiary delivered
pursuant to the provisions hereof, to the performance by the Company of its
covenants and other obligations hereunder, and to the following further
conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective and at Closing Time no stop order suspending the effectiveness
of the Registration Statement shall have been issued under the 1933 Act
or proceedings therefor initiated or threatened by the Commission, and
any request on the part of the Commission for additional information
shall have been complied with to the reasonable satisfaction of counsel
to the U.S. Underwriters. A prospectus containing the Rule 430A
Information shall have been filed with the Commission in accordance with
Rule 424(b) (or a post-effective amendment providing such information
shall have been filed and declared effective in accordance with the
requirements of Rule 430A) or, if the Company has elected to rely upon
Rule 434, a Term Sheet shall have been filed with the Commission in
accordance with Rule 424(b).
(b) OPINIONS OF COUNSEL FOR COMPANY. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of
Closing Time, together with signed or reproduced copies of each such
letter for each of the other Underwriters, of each of (1) ▇▇▇▇▇, ▇▇▇▇▇▇▇
& ▇▇▇▇▇▇▇▇▇, LLP, counsel for the Company, in form and substance
satisfactory to counsel for the U.S. Underwriters, to the effect set
forth in Exhibit A hereto and to such further effect as counsel to the
U.S. Underwriters may reasonably request; (2) ▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇,
LLP, patent counsel for the Company, in form and substance satisfactory
to counsel for the U.S. Underwriters, to the effect set forth in Exhibit
B hereto and to such further effect as counsel to the U.S. Underwriters
may reasonably request; and (3) Buc & ▇▇▇▇▇▇▇▇▇, special regulatory
counsel for the Company, in form and substance satisfactory to counsel
for the U.S. Underwriters, to the
16
effect set forth in Exhibit D hereto and to such further effect as
counsel to the U.S. Underwriters may reasonably request.
(c) OPINION OF COUNSEL FOR U.S. UNDERWRITERS. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of
Closing Time, of Shearman & Sterling, counsel for the U.S. Underwriters,
together with signed or reproduced copies of such letter for each of the
other Underwriters with respect to the matters set forth in clauses (i),
(ii), (v), (vi) (solely as to preemptive or other similar rights arising
by operation of law or under the charter or by-laws of the Company),
(viii) through (x), inclusive, (xii), (xiv) (solely as to the information
in the Prospectus under "Description of Capital Stock-- Common Stock")
and the penultimate paragraph of Exhibit A hereto. In giving such opinion
such counsel may rely, as to all matters governed by the laws of
jurisdictions other than the law of the State of New York and the federal
law of the United States, upon the opinions of counsel satisfactory to
the Representatives. Such counsel may also state that, insofar as such
opinion involves factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the Company and the
Subsidiary and certificates of public officials.
(d) OFFICERS' CERTIFICATE. At Closing Time, there shall not have
been, since the date hereof or since the respective dates as of which
information is given in the Prospectuses, any material adverse change in
the condition, financial or otherwise, or in the earnings, business
affairs or business prospects of the Company and the Subsidiary
considered as one enterprise, whether or not arising in the ordinary
course of business, and the Representatives shall have received a
certificate of the Chairman or President of the Company and of the chief
financial officer of the Company, dated as of Closing Time, to the effect
that (i) there has been no such material adverse change, (ii) the
representations and warranties in Section 1(a) hereof are true and
correct with the same force and effect as though expressly made at and as
of Closing Time, (iii) the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at or
prior to Closing Time, and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are pending or are
contemplated by the Commission.
(e) ACCOUNTANTS' COMFORT LETTER. At the time of the execution of
this Agreement, the Representatives shall have received from ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ LLP a letter dated such date, in form and substance satisfactory
to the Representatives, together with signed or reproduced copies of such
letter for each of the other U.S. Underwriters containing statements and
information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and
certain financial information contained in the Registration Statement and
the Prospectuses.
(f) BRING-DOWN COMFORT LETTER. At Closing Time, the
Representatives shall have received from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP a letter,
dated as of Closing Time, to the effect that they reaffirm the statements
made in the letter furnished pursuant to subsection (e) of
17
this Section, except that the specified date referred to shall be a date
not more than three business days prior to Closing Time.
(g) APPROVAL OF LISTING. At Closing Time, the Securities shall
have been approved for inclusion in the Nasdaq National Market, subject
only to official notice of issuance.
(h) NO OBJECTION. The NASD has confirmed that it has not raised
any objection with respect to the fairness and reasonableness of the
underwriting terms and arrangements.
(i) LOCK-UP AGREEMENTS. At the date of this Agreement, the
Representatives shall have received an agreement substantially in the
form of Exhibit C-1 hereto signed by each of the entities and persons
listed on Schedule C-1 hereto, and an agreement substantially in the form
of Exhibit C-2 hereto signed by each of the entities and persons listed
on Schedule C-2 hereto.
(j) PURCHASE OF INITIAL INTERNATIONAL SECURITIES.
Contemporaneously with the purchase by the Underwriters of the Initial
U.S. Securities under this Agreement, the International Managers shall
have purchased the Initial International Securities under the
International Purchase Agreement.
(k) CONDITIONS TO PURCHASE OF U.S. OPTION SECURITIES. In the event
that the U.S. Underwriters exercise their option provided in Section 2(b)
hereof to purchase all or any portion of the U.S. Option Securities, the
representations and warranties of the Company contained herein and the
statements in any certificates furnished by the Company or the Subsidiary
hereunder shall be true and correct as of each Date of Delivery and, at
the relevant Date of Delivery, the Representatives shall have received:
(i) OFFICERS' CERTIFICATE. A certificate, dated such Date
of Delivery, of the Chairman or President of the Company and of
the chief financial officer of the Company confirming that the
certificate delivered at Closing Time pursuant to Section 5(d)
hereof remains true and correct as of such Date of Delivery.
(ii) OPINION OF COUNSEL FOR COMPANY. The favorable opinion
each of (1) ▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, LLP, counsel for the
Company, (2) ▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, LLP, patent counsel for
the Company, and (3) Buc & ▇▇▇▇▇▇▇▇▇, special regulatory counsel
for the Company, each in form and substance satisfactory to
counsel for the U.S. Underwriters, dated such Date of Delivery,
relating to the U.S. Option Securities to be purchased on such
Date of Delivery and otherwise to the same effect as the opinions
required by Section 5(b) hereof.
(iii) OPINION OF COUNSEL FOR U.S. UNDERWRITERS. The
favorable opinion of Shearman & Sterling, counsel for the U.S.
Underwriters, dated such Date of Delivery, relating to the U.S.
Option Securities to be purchased on such Date of
18
Delivery and otherwise to the same effect as the opinion required
by Section 5(c) hereof.
(iv) BRING-DOWN COMFORT LETTER. A letter from ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ LLP, in form and substance satisfactory to the
Representatives and dated such Date of Delivery, substantially in
the same form and substance as the letter furnished to the
Representatives pursuant to Section 5(f) hereof, except that the
"specified date" in the letter furnished pursuant to this
paragraph shall be a date not more than three days prior to such
Date of Delivery.
(l) ADDITIONAL DOCUMENTS. At Closing Time and at each Date of
Delivery, counsel for the U.S. Underwriters shall have been furnished
with such documents and opinions as they may require for the purpose of
enabling them to pass upon the issuance and sale of the Securities as
herein contemplated, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of the Securities as herein
contemplated shall be satisfactory in form and substance to the
Representatives and counsel for the U.S. Underwriters.
(m) TERMINATION OF AGREEMENT. If any condition specified in this
Section shall not have been fulfilled when and as required to be
fulfilled, this Agreement, or, in the case of any condition to the
purchase of U.S. Option Securities on a Date of Delivery which is after
the Closing Time, the obligations of the several U.S. Underwriters to
purchase the relevant Option Securities, may be terminated by the
Representatives by notice to the Company at any time at or prior to
Closing Time or such Date of Delivery, as the case may be, and such
termination shall be without liability of any party to any other party
except as provided in Section 4 and except that Sections 1, 6, 7 and, if
any Securities have been purchased and sold pursuant hereto, Section 8
shall survive any such termination and remain in full force and effect.
SECTION 6. INDEMNIFICATION.
(a) Indemnification of U.S. Underwriters. The Company agrees to indemnify
and hold harmless each U.S. Underwriter and each person, if any, who controls
any U.S. Underwriter within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement (or any amendment thereto), including the Rule 430A Information
and the Rule 434 Information, if applicable, or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out of
any untrue statement or alleged untrue statement of a material fact
included in any preliminary Prospectuses or the Prospectuses (or any
amendment or supplement thereto), or the omission or alleged
19
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of (A) the violation of any
applicable laws or regulations of foreign jurisdictions where Reserved
Securities have been offered and (B) any untrue statement or alleged
untrue statement of a material fact included in the supplement or
prospectus wrapper material distributed in any foreign jurisdiction in
connection with the reservation and sale of the Reserved Securities to
eligible directors, officers, employees and business associates of the
Company and related persons or the omission or alleged omission therefrom
of a material fact necessary to make the statements therein, when
considered in conjunction with the Prospectuses or preliminary
prospectuses, not misleading;
(iii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission or in connection with any
violation of the nature referred to in Section 6(a)(ii)(A) hereof;
provided that (subject to Section 6(d) below) any such settlement is
effected with the written consent of the Company; and
(iv) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by ▇▇▇▇▇▇▇
▇▇▇▇▇), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission or in connection with any violation
of the nature referred to in Section 6(a)(ii)(A) hereof, to the extent
that any such expense is not paid under (i), (ii) or (iii) above;
PROVIDED, HOWEVER, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense (a) to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
U.S. Underwriter through the Representatives expressly for use in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any preliminary
prospectuses or the U.S. Prospectus (or any amendment or supplement thereto) and
(b) with respect to any preliminary prospectus to the extent that any such loss,
liability, claim, damage or expense of such U.S. Underwriter results solely from
the fact that such U.S. Underwriter sold Securities to a person as to whom the
Company shall establish that there was not sent by commercially reasonable
means, at or prior to the written confirmation of such sale, a copy of the
Prospectus in any case where such delivery is required by the 1933 Act, if the
Company has previously furnished copies
20
thereof in sufficient quantity to such U.S. Underwriter (in compliance with
Section 3(d) hereof) and the loss, liability, claim, damage or expense of such
U.S. Underwriter results from an untrue statement or omission of a material fact
contained in the preliminary prospectuses that was corrected in the Prospectus.
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS. Each U.S.
Underwriter severally agrees to indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act against any and all loss, liability,
claim, damage and expense described in the indemnity contained in subsection (a)
of this Section, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information, if applicable, or any preliminary U.S. prospectus or
the U.S. Prospectus (or any amendment or supplement thereto) in reliance upon
and in conformity with written information furnished to the Company by such U.S.
Underwriter through the Representatives expressly for use in the Registration
Statement (or any amendment thereto) or such preliminary prospectus or the U.S.
Prospectus (or any amendment or supplement thereto).
21
(c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by ▇▇▇▇▇▇▇ ▇▇▇▇▇, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; PROVIDED,
HOWEVER, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) and Section 6(a)(iii) effected without its written consent if
(i) such settlement is entered into more than 45 days after receipt by such
indemnifying party of the aforesaid request, (ii) such indemnifying party shall
have received notice of the terms of such settlement at least 30 days prior to
such settlement being entered into and (iii) such indemnifying party shall not
have reimbursed such indemnified party in accordance with such request prior to
the date of such settlement; provided that an indemnifying party shall not be
liable for any such settlement effected without its consent if such indemnifying
party, prior to the date of such settlement, (1) reimburses such indemnified
party in accordance with such request for the amount of such fees and expenses
of counsel as the indemnifying party believes in good faith to be reasonable,
and (2) provides written notice to the indemnified party that the indemnifying
party disputes in good faith the reasonableness of the unpaid balance of such
fees and expenses.
(e) INDEMNIFICATION FOR RESERVED SECURITIES. In connection with the offer
and sale of the Reserved Securities, the Company agrees, promptly upon a request
in writing, to indemnify
22
and hold harmless the U.S. Underwriters from and against any and all losses,
liabilities, claims, damages and expenses incurred by them as a result of the
failure of eligible directors, officers, employees and business associates of
the Company and related persons to pay for and accept delivery of Reserved
Securities which, by the end of the first business day following the date of
this Agreement, were subject to a properly confirmed agreement to purchase.
SECTION 7. CONTRIBUTION. If the indemnification provided for in Section 6
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and the U.S. Underwriters on the other hand from the offering of the
Securities pursuant to this Agreement or (ii) if the allocation provided by
clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and of the U.S.
Underwriters on the other hand in connection with the statements or omissions,
or in connection with any violation of the nature referred to in Section
6(a)(ii)(A) hereof, which resulted in such losses, liabilities, claims, damages
or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
U.S. Underwriters on the other hand in connection with the offering of the U.S.
Securities pursuant to this Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the U.S.
Securities pursuant to this Agreement (before deducting expenses) received by
the Company and the total underwriting discount received by the U.S.
Underwriters, in each case as set forth on the cover of the U.S. Prospectus, or,
if Rule 434 is used, the corresponding location on the Term Sheet, bear to the
aggregate initial public offering price of the U.S. Securities as set forth on
such cover.
The relative fault of the Company on the one hand and the U.S.
Underwriters on the other hand shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company or by the U.S. Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission or any violation of the nature referred to in Section
6(a)(ii)(A) hereof.
The Company and the U.S. Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section were determined by pro rata
allocation (even if the U.S. Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section. The aggregate amount
of losses, liabilities, claims, damages and expenses incurred by an indemnified
party and referred to above in this Section shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency
23
or body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section, no U.S. Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the U.S. Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
U.S. Underwriter has otherwise been required to pay by reason of any such untrue
or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section, each person, if any, who controls a U.S.
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such U.S.
Underwriter, and each director of the Company, each officer of the Company who
signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act shall have the same rights to contribution as the Company. The U.S.
Underwriters' respective obligations to contribute pursuant to this Section are
several in proportion to the number of Initial U.S. Securities set forth
opposite their respective names in Schedule A hereto and not joint.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or the Subsidiary
submitted pursuant hereto shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any U.S. Underwriter or
controlling person, or by or on behalf of the Company, and shall survive
delivery of the Securities to the U.S. Underwriters.
SECTION 9. TERMINATION OF AGREEMENT.
(a) TERMINATION; GENERAL. The Representatives may terminate this
Agreement, by notice to the Company, at any time at or prior to Closing Time (i)
if there has been, since the time of execution of this Agreement or since the
respective dates as of which information is given in the U.S. Prospectus, any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and the
Subsidiary considered as one enterprise, whether or not arising in the ordinary
course of business, or (ii) if there has occurred any material adverse change in
the financial markets in the United States or the international financial
markets, any outbreak of hostilities or escalation thereof or other calamity or
crisis or any change or development involving a prospective change in national
or international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the reasonable judgment of the
Representatives, impracticable to market the Securities or to enforce contracts
for the sale of the Securities, or (iii) if trading in any securities of the
Company has been suspended or materially limited by the Commission or the
24
Nasdaq National Market, or if trading generally on the American Stock Exchange
or the New York Stock Exchange or in the Nasdaq National Market has been
suspended or materially limited, or minimum or maximum prices for trading have
been fixed, or maximum ranges for prices have been required, by any of said
exchanges or by such system or by order of the Commission, the NASD or any other
governmental authority, or (iv) if a banking moratorium has been declared by
either Federal, Delaware or New York authorities.
(b) LIABILITIES. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7 and, if any Securities have been purchased and sold pursuant hereto,
Section 8 shall survive such termination and remain in full force and effect.
SECTION 10. DEFAULT BY ONE OR MORE OF THE U.S. UNDERWRITERS. If one or
more of the U.S. Underwriters shall fail at Closing Time or a Date of Delivery
to purchase the Securities which it or they are obligated to purchase under this
Agreement (the "DEFAULTED SECURITIES"), the Representatives shall have the
right, within 24 hours thereafter, to make arrangements for one or more of the
non-defaulting U.S. Underwriters, or any other underwriters, to purchase all,
but not less than all, of the Defaulted Securities in such amounts as may be
agreed upon and upon the terms herein set forth; if, however, the
Representatives shall not have completed such arrangements within such 24-hour
period, then:
(a) if the number of Defaulted Securities does not exceed 10% of
the number of U.S. Securities to be purchased on such date, the
non-defaulting U.S. Underwriters shall be obligated, each severally and
not jointly, to purchase the full amount thereof in the proportions that
their respective underwriting obligations hereunder bear to the
underwriting obligations of all non-defaulting U.S. Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the
number of U.S. Securities to be purchased on such date, this Agreement
or, with respect to any Date of Delivery which occurs after Closing Time,
the obligation of the U.S. Underwriters to purchase and of the Company to
sell the U.S. Option Securities to be purchased and sold on such Date of
Delivery shall terminate without liability on the part of any
non-defaulting U.S. Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
U.S. Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement or, in the case of a Date of Delivery which is after Closing
Time, which does not result in a termination of the obligation of the U.S.
Underwriters to purchase and the Company to sell the relevant U.S. Option
Securities, as the case may be, either the Representatives or the Company shall
have the right to postpone Closing Time or the relevant Date of Delivery, as the
case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or Prospectuses or in any other
documents or arrangements. As used
25
herein, the term "U.S. UNDERWRITER" includes any person substituted for a U.S.
Underwriter under this Section.
SECTION 11. NOTICES. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the U.S.
Underwriters shall be directed to the Representatives at World Financial Center,
North Tower, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, attention of --;
and notices to the Company shall be directed to it at ▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇, attention of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇.
SECTION 12. PARTIES. This Agreement shall inure to the benefit of and be
binding upon the U.S. Underwriters and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the U.S.
Underwriters and the Company and their respective successors and the controlling
persons and officers and directors referred to in Sections 6 and 7 and their
heirs and legal representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended to be for the
sole and exclusive benefit of the U.S. Underwriters and the Company and their
respective successors, and said controlling persons and officers and directors
and their heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Securities from any U.S.
Underwriter shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED
TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. EFFECT OF HEADINGS. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
26
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the U.S. Underwriters and the Company in accordance with its terms.
Very truly yours,
EXACT SCIENCES CORPORATION
By
--------------------------------------
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
CIBC WORLD MARKETS CORP.
▇▇▇▇▇▇ ▇▇▇▇▇▇ PARTNERS LLC
By: ▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By
--------------------------------------
Authorized Signatory
For itself and as Representatives of the other U.S. Underwriters named in
Schedule A hereto.
27
SCHEDULE A
NUMBER OF
U.S. INITIAL
NAME OF U.S. UNDERWRITER SECURITIES
------------------------ ------------
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated.......................................................
CIBC World Markets Corp.................................................................
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC..............................................................
Total................................................................................... [number of shares]
==================
SCHEDULE B
EXACT SCIENCES CORPORATION
[number of shares] Shares of Common Stock
(Par Value $0.01 Per Share)
1. The initial public offering price per share for the Securities,
determined as provided in said Section 2, shall be $--.
2. The purchase price per share for the U.S. Securities to be paid by the
several U.S. Underwriters shall be $--, being an amount equal to the initial
public offering price set forth above less $-- per share; provided that the
purchase price per share for any U.S. Option Securities purchased upon the
exercise of the over-allotment option described in Section 2(b) shall be reduced
by an amount per share equal to any dividends or distributions declared by the
Company and payable on the Initial U.S. Securities but not payable on the U.S.
Option Securities.
SCHEDULE C-1
List of persons and entities (other than officers, directors
and 10% stockholders of the Company) subject to lock-up
SCHEDULE C-2
List of officers, directors and 10% stockholders of the Company
subject to lock-up
2
EXHIBIT A
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
______________ __, 2001
▇▇▇▇▇▇▇ ▇▇▇▇▇ International
CIBC World Markets plc
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC
c/o Merrill ▇▇▇▇▇ International
Ropemaker Place
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇
Re: EXACT SCIENCES CORPORATION
SHARES OF COMMON STOCK
Ladies and Gentlemen:
We have acted as counsel for EXACT Sciences Corporation, a Delaware
corporation (the "Company"), in connection with the sale by the Company to you
(collectively, the "International Managers") pursuant to the International
Purchase Agreement dated January __, 2001 (the "International Purchase
Agreement") of an aggregate of ___ shares (the "Initial International
Securities") of the Company's common stock, par value $.01 per share (the
"Common Stock") and up to an aggregate of ___ shares of Common Stock issuable
pursuant to an over-allotment option granted to the International Managers (the
"International Option Securities", and together with the Initial International
Securities, the "International Securities"), and the sale by the Company to the
several underwriters (the "U.S. UNDERWRITERS", and together with the
International Managers, the "Underwriters") named in SCHEDULE I to the U.S.
Purchase Agreement dated __________ __, 2001 (the "U.S. Purchase Agreement", and
together with the International Purchase Agreement, the "Purchase Agreements")
among you, as Representatives of the U.S. Underwriters, and the Company of an
aggregate of ________ shares (the "Initial U.S. Securities") of the Company's
Common Stock and up to an aggregate of ______ shares of Common Stock issuable
pursuant to an over-allotment option granted to the U.S. Underwriters (the "U.S.
Option Securities", and together with the Initial U.S. Securities, the "U.S.
Securities").
▇▇▇▇▇▇▇ ▇▇▇▇▇ International
CIBC World Markets plc
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC
______________ __, 2001
Page 2
The Initial International Securities and the Initial U.S. Securities are
hereinafter called the "Initial Securities", the International Option Securities
and the U.S. Option Securities are hereinafter called the "Option Securities"
and the International Securities and the U.S. Securities are hereinafter called
the "Securities." Capitalized terms used herein, unless otherwise defined
herein, shall have the respective meanings assigned to such terms in the U.S.
Purchase Agreement.
This opinion is being furnished to you pursuant to Section 5(b) of the
International Purchase Agreement.
We have examined such documents, records and matters of law as we have
deemed necessary for purposes of this opinion, including:
(i) the Company's Registration Statement on Form S-1 (File No.
333-48812) relating to the Securities, filed with the Securities and
Exchange Commission (the "Commission") on October 27, 2000 under the
Securities Act of 1933, as amended (the "Act"), Amendment No. 1 thereto
filed with the Commission on December 4, 2000, Amendment No. 2 thereto
filed with the Commission on December 7, 2000, Amendment No. 3 thereto
filed with the Commission on December 26, 2000, Amendment No. 4 thereto
filed with the Commission on January 8, 2001, and Amendment No. 5
thereto filed with the Commission on January __, 2001, including
information deemed to be part of the registration statement at the time
of effectiveness pursuant to Rule 430A of the General Rules and
Regulations promulgated under the Act (the "Rules and Regulations")
(such registration statement, as so amended, being hereinafter referred
to as the "Registration Statement");
(ii) the final U.S. prospectus (the "U.S. Prospectus"), dated
______ __, 2001, relating to the U.S. Securities, in the form filed
with the Commission pursuant to Rule 424(b) of the Rules and
Regulations;
(iii) the final international prospectus, dated _______ __,
2001, (the "International Prospectus", and together with the U.S.
Prospectus, the "Prospectuses") relating to the International
Securities, in the form filed with the Commission pursuant to Rule
424(b) of the Rules and Regulations;
(iv) executed copies of the Purchase Agreements;
(v) Certificates of the Secretary of State of the State of
Delaware and Certificates of the Secretary of State of the Commonwealth
of Massachusetts with respect
▇▇▇▇▇▇▇ ▇▇▇▇▇ International
CIBC World Markets plc
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC
______________ __, 2001
Page 3
to each of the Company and its subsidiary, EXACT Sciences Securities
Corporation (the "Subsidiary");
(vi) the Sixth Amended and Restated Certificate of
Incorporation of the Company as filed on ________ (the "Company's
Certificate of Incorporation"), and the Certificate of Incorporation of
the Subsidiary as filed on December 18, 2000 (the "Subsidiary's
Certificate of Incorporation", and together with the Company's
Certificate of Incorporation, the "Certificates of Incorporation"),
each as certified by the Secretary of State of the State of Delaware;
(vii) the by-laws, as amended, of the Company (the "Company's
By-laws") and the by-laws of the Subsidiary (the "Subsidiary's
By-laws", and together with the Company's By-laws, the "By-laws"), each
as currently in effect;
(viii) the minute books and stock records of each of the
Company and Subsidiary;
(ix) a Secretary's Certificate of the Company, dated the date
hereof;
(x) the officers' certificates, dated the date hereof; and
(xi) such other documents, records, and materials as we deemed
necessary for the purpose of rendering the opinions rendered herein.
In rendering this opinion, as to all matters of fact relevant to this
opinion, we have assumed the completeness and accuracy of, and are relying
solely upon, the representations, warranties and agreements of the Company set
forth in the Purchase Agreements and the statements set forth in certificates of
public officials and officers of the Company, without making any independent
investigation or inquiry with respect to the completeness or accuracy of such
representations, warranties, agreements or statements, other than a review of
the Certificates of Incorporation, the By-laws and the relevant minute books of
the Company and the Subsidiary, respectively. In rendering the opinions set
forth in paragraphs (1) and (3) below as to the valid existence and good
standing of the Company and the Subsidiary in the State of Delaware and the
Commonwealth of Massachusetts, we have assumed the completeness and accuracy of,
and are relying solely upon, certificates of legal existence and good standing
issued by the Secretary of State of Delaware and the Secretary of State of
Massachusetts, respectively. Any reference herein to "our knowledge," "known to
us" or any variation thereof shall mean that in the course of our representation
of the Company in connection with the preparation of the Registration
▇▇▇▇▇▇▇ ▇▇▇▇▇ International
CIBC World Markets plc
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC
______________ __, 2001
Page 4
Statement, we have not obtained actual knowledge of the existence or absence of
any facts that would contradict our opinions set forth below.
We have assumed the genuineness of all signatures and the authenticity
of all documents submitted to us as originals and the conformity to original
documents of all documents submitted to us as copies, whether certified or not.
We are members only of the bar of the Commonwealth of Massachusetts and
therefore do not hold ourselves out as experts in, and express no opinion as to,
the laws of any other state or jurisdiction other than the federal laws of the
United States and the Commonwealth of Massachusetts, and, to the extent
necessary for this opinion, the General Corporation Law of the State of
Delaware. We note that each Purchase Agreement provides that it is to be
governed by the laws of the State of New York. We express no opinion as to
matters of the laws of the State of New York. For the matters covered in
paragraphs 12 and 14 below, we express no opinion with respect to the federal
Food, Drug and Cosmetic Act ("FDCA") or the Clinical Laboratory Improvement Act
("CLIA") and the regulations promulgated thereunder. We have not acted, and do
not act, as counsel for the Company in connection with the FDCA or CLIA.
Based on and subject to the foregoing, we are of the opinion that:
1. The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware. The Company is duly qualified as a foreign corporation to
transact business and is in good standing in Massachusetts, which is
the only jurisdiction in the United States in which, to our knowledge,
the Company maintains an office or leases real property.
2. The Company has the corporate power and authority to own,
lease and operate its properties and to conduct its business as
described in the Prospectuses and to enter into and perform its
obligations under the Purchase Agreements.
3. The Subsidiary has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware. The Subsidiary is duly qualified as a foreign corporation
to transact business and is in good standing in Massachusetts, which is
the only jurisdiction in the United States in which, to our knowledge,
the Subsidiary maintains an office or leases real property.
4. The Subsidiary has the corporate power and authority to
own, lease and operate its properties and to conduct its business as
currently conducted and proposed to be conducted. All of the issued and
outstanding capital stock of the Subsidiary has been
▇▇▇▇▇▇▇ ▇▇▇▇▇ International
CIBC World Markets plc
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC
______________ __, 2001
Page 5
duly authorized and validly issued, is fully paid and non-assessable
and is owned by the Company, to our knowledge, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or
equity; none of the outstanding shares of capital stock of the
Subsidiary was issued in violation of the preemptive or similar rights
of any securityholder of the Subsidiary arising under the Delaware
General Corporation Law, the Subsidiary's Certificate of Incorporation
or the Subsidiary's By-laws or, to our knowledge, any agreement to
which the Subsidiary is a party.
5. The authorized, issued and outstanding capital stock of the
Company is as set forth in the Prospectuses in the column entitled
"Actual" under the caption "Capitalization" (except for subsequent
issuances, if any, pursuant to the Purchase Agreements or pursuant to
reservations, agreements or employee benefit plans referred to in the
Prospectuses or pursuant to the exercise of convertible securities,
options or warrants referred to in the Prospectuses); the shares of
issued and outstanding capital stock of the Company have been duly
authorized and validly issued and are fully paid and non-assessable;
and none of the outstanding shares of capital stock of the Company was
issued in violation of the preemptive or other similar rights of any
securityholder of the Company arising under the Delaware General
Corporation Law, the Company's Certificate of Incorporation, the
Company's By-laws or, to our knowledge, any agreement to which the
Company is a party.
6. The Securities have been duly authorized for issuance and
sale to the Underwriters pursuant to the Purchase Agreements, and, when
issued and delivered by the Company pursuant to the Purchase
Agreements, against payment of the consideration set forth in the
Purchase Agreements, will be validly issued and fully paid and
non-assessable and no holder of the Securities is or will be subject to
personal liability by reason of being such a holder.
7. The issuance of the Securities is not subject to the
preemptive or other similar rights of any securityholder of the Company
arising under the Delaware General Corporation law, the Company's
Certificate of Incorporation, By-laws or, to our knowledge, any
agreement to which the Company is a party.
8. The Purchase Agreements have been duly authorized, executed
and delivered by the Company.
9. The Registration Statement, the Prospectuses and each
amendment or supplement to the Registration Statement and the
Prospectuses as of their respective effective or issue dates (other
than the financial statements and supporting schedules
▇▇▇▇▇▇▇ ▇▇▇▇▇ International
CIBC World Markets plc
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC
______________ __, 2001
Page 6
included therein or omitted therefrom, as to which we express no
opinion) complied as to form in all material respects with the
requirements of the Act and the Rules and Regulations.
10. The form of certificate filed with the Commission used to
evidence the Common Stock complies in all material respects with all
applicable statutory requirements, with any applicable requirements of
the Company's Certificate of Incorporation and By-laws and the
requirements of the Nasdaq National Market.
11. The information in the Prospectuses under "Description of
Capital Stock--Common Stock," "Description of Capital Stock--
Preferred Stock," "Business--Legal Proceedings," and "Management," to
the extent that such statements purport to summarize legal matters, the
Company's Certificate of Incorporation and the Company's By-laws or
legal proceedings, or legal conclusions, has been reviewed by us and is
correct in all material respects.
12. To our knowledge, there are no statutes or regulations
that are required to be described in the Prospectuses that are not
described as required.
13. All descriptions in the Registration Statement of
contracts and other documents to which the Company is a party are
accurate in all material respects; and we do not know of any contracts
or other documents of a character required to be filed as an exhibit to
the Registration Statement or required to be described in the
Registration Statement or the Prospectuses which are not filed or
described as required.
14. No filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency (other than under the Act and the 1933
Act Regulations, which have been obtained, or as may be required under
the securities or blue sky laws of the various states or any non-U.S.
jurisdiction, as to which we express no opinion) is necessary or
required in connection with the due authorization, execution and
delivery of the Purchase Agreements or for the offering, issuance, sale
or delivery of the Securities. The execution, delivery and performance
of the Purchase Agreements and the consummation of the transactions
contemplated in the Purchase Agreements and in the Registration
Statement (including the issuance and sale of the Securities) and
compliance by the Company with its obligations under the Purchase
Agreements do not and will not, whether with or without the giving of
notice or lapse of time or both, contravene or constitute a breach of,
or default or Repayment Event under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the
▇▇▇▇▇▇▇ ▇▇▇▇▇ International
CIBC World Markets plc
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC
______________ __, 2001
Page 7
Company or the Subsidiary pursuant to, any agreement that is filed as
an exhibit to the Registration Statement, nor will such action result
in any violation of the provisions of the Certificates of Incorporation
or By-laws, or a violation of any applicable law, statute, rule,
regulation, judgment, order, writ or decree, known to us, of any
government, government instrumentality or court having jurisdiction
over the Company, the Subsidiary, or any of their respective
properties, assets or operations (except that we express no opinion as
to state securities laws or, with respect to this paragraph, federal
antifraud laws).
15. To our knowledge, except as disclosed in the Registration
Statement, there are no contracts, agreements or understandings between
the Company and any person granting such person the right to require
the Company to file a registration statement under the Act with respect
to any securities of the Company or to require the Company to include
such securities with the Securities registered pursuant to the
Registration Statement.
16. The Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in
the 1940 Act.
17. We do not know of any legal or governmental proceedings
pending or overtly threatened to which the Company or the Subsidiary is
a party or to which any of their respective property is subject that
are required to be described in the Registration Statement or the
Prospectuses and are not so described therein. In making the statements
in this paragraph, we have not searched the dockets of any courts or
governmental authorities.
--------------------------
The Registration Statement has become effective under the Act and, to
our knowledge, no stop order suspending its effectiveness has been issued and no
proceedings for that purpose are pending before or threatened by the Commission.
In the course of the preparation of the Registration Statement and the
Prospectuses, we have participated in conferences with officers, employees and
other representatives of the Company, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, the Company's
independent public accountants, Buc & ▇▇▇▇▇▇▇▇▇, regulatory counsel to the
Company, and your representatives and counsel concerning the information
contained in the Registration Statement and the Prospectuses. We have not,
however, independently verified and are not passing upon, and do not assume any
responsibility for, the accuracy, completeness or fairness of the statements
contained in the Registration
▇▇▇▇▇▇▇ ▇▇▇▇▇ International
CIBC World Markets plc
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC
______________ __, 2001
Page 8
Statement and the Prospectuses. Based on our participation as described above,
nothing has come to our attention that would lead us to believe that the
Registration Statement (except for financial statements, financial statement
schedules, and other financial data included therein, as to which we make no
statement), at the time it became effective, contained an untrue statement of a
material fact, or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein not misleading, or that the
Prospectuses (except for financial statements, financial statement schedules,
and other financial data included therein, as to which we make no statement), as
of the date of such Prospectuses or as of the date hereof, included or include
an untrue statement of a material fact or omitted or omits 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.
This opinion is being furnished to you solely for your benefit in
connection with the transactions contemplated by the Purchase Agreements and may
not be used for any other purpose or relied upon by any person other than you.
Except with our prior written consent, the opinions herein expressed are not to
be used, circulated, quoted or otherwise referred to in connection with any
transactions other than those contemplated by the Purchase Agreements by or to
any other person.
Very truly yours,
▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, LLP
Exhibit B
FORM OF OPINION OF PATENT COUNSEL TO THE COMPANY
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
_____________, 2001
We are patent counsel to EXACT Sciences Corporation, a Delaware
corporation (referred to herein as the "Company"). This opinion is being
furnished to you pursuant to that certain Purchase Agreement dated , 2001 (the
"Agreement") relating to the sale by the Company of shares of its Common Stock.
Unless otherwise defined herein, the definition of the capitalized terms used
herein shall be the same as those in the Agreement.
We are familiar generally with the technology used by the Company in its
business and that is the subject of issued patents, and pending patent
applications listed in SCHEDULE A hereto. We have read the sections of the
Registration Statement under the captions "Risk Factors--To the extent we cannot
enforce and protect our intellectual property rights, our business may suffer"
and "Business--Patents and Intellectual Property" (collectively, the
"Intellectual Property Sections"), referring to patents, trade secrets,
trademarks, service marks or other proprietary information or materials.
In rendering the following opinion, we have not conducted, nor have we
been requested to conduct, a specific search, investigation, or evaluation with
respect to the enforceability or validity of any patents owned or licensed by
the Company; or third party infringement of any claim of any patent; nor have we
conducted, or been requested to conduct, any other specific search,
investigation, or evaluation.
Based upon the foregoing, we are of the opinion that:
(i) The statements in the Registration Statement and the Prospectuses
under the captions "Risk Factors--To the extent we cannot enforce and protect
our intellectual property rights, our business may suffer" and
"Business--Patents and Intellectual Property" (collectively, the "Intellectual
Property Sections") insofar as such statements constitute a summary of legal
matters, documents or proceedings referred to therein, are accurate and fairly
summarize the matters referred to therein.
(ii) To the best of our knowledge, there are no pending or threatened
actions, suits or proceedings against or affecting any patents, patent licenses,
trademarks, or other proprietary intellectual property rights ("INTELLECTUAL
PROPERTY") owned or used by the Company or necessary to conduct the business now
or proposed to be conducted by it as described in the Prospectuses, to
which the Company is a party or to which any of the properties of the Company is
subject, except as disclosed in the Registration Statement and the Prospectuses.
(iii) To the best of our knowledge, the Company has not received any
notice of infringement or alleged infringement by the Company or conflict with
asserted rights of others with respect to Intellectual Property, except as
disclosed in the Registration Statement and the Prospectuses.
(iv) Although we have not verified the accuracy or completeness of
statements contained in the Registration Statement, nothing has come to our
attention that would lead us to believe (1) that the Intellectual Property
Sections in the Registration Statement at the time such Registration Statement
or any such amendment became effective, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statement therein not misleading or (2) that the
Intellectual Property Sections in the Prospectuses or any amendment or
supplement thereto, at the time the Prospectuses was issued, at the time any
such amended or supplemented prospectus was issued or at the Closing Time,
included or includes an untrue statement of a material fact or omitted or omits
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.
Very truly yours,
▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, LLP
FORM OF LOCK-UP AGREEMENT PURSUANT TO SECTION 5(i)
Exhibit ▇-▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
CIBC Worldmarkets and
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners
as U.S. Representatives of the several
U.S. Underwriters to be named in the
within-mentioned U.S. Purchase Agreement
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
North Tower
World Financial Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: PROPOSED PUBLIC OFFERING BY EXACT CORPORATION
Dear Sirs:
The undersigned, a stockholder of Exact Corporation (the "COMPANY"),
understands that ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated ("▇▇▇▇▇▇▇ ▇▇▇▇▇") and CIBC World Markets and ▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners
propose to enter into a U.S. Purchase Agreement (the "U.S. PURCHASE AGREEMENT")
with the Company providing for the public offering of shares (the "SECURITIES")
of the Company's common stock, par value $.01 per share (the "COMMON STOCK"). In
recognition of the benefit that such an offering will confer upon the
undersigned as a stockholder of the Company, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned agrees with each underwriter to be named in the U.S. Purchase
Agreement that, during the period commencing on the date of the U.S. Purchase
Agreement (the "Commencement Date") and ending 180 days thereafter, the
undersigned will not, without the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇,
directly or indirectly, (i) offer, pledge, sell, contract to sell, sell any
option or contract to purchase, purchase any option or contract to sell, grant
any option, right or warrant for the sale of, or otherwise dispose of or
transfer any shares of the Company's Common Stock or any securities convertible
into or exchangeable or exercisable for Common Stock, whether now owned or
hereafter acquired by the undersigned or with respect to which the undersigned
has or hereafter acquires the power of disposition, or file any registration
statement under the Securities Act of
1933, as amended, with respect to any of the foregoing or (ii) enter into any
swap or any other agreement or any transaction that transfers, in whole or in
part, directly or indirectly, the economic consequence of ownership of the
Common Stock, whether any such swap or transaction is to be settled by delivery
of Common Stock or other securities, in cash or otherwise; provided, however,
that the undersigned may transfer shares of Common Stock or options to purchase
shares of Common Stock (i) if the undersigned is an individual, pursuant to a
bona fide gift to the undersigned's immediate family members, trusts for the
benefit of such person or immediate family members and partnerships in which
such person and immediate family members are the only partners and (ii) if the
undersigned is a corporation, partnership, limited liability company or other
form of business entity, to a partner or member of such entity or the estate of
any such partner or member, or to an affiliate of the undersigned, in each case,
only if such transferee executes and delivers to ▇▇▇▇▇▇▇ ▇▇▇▇▇ an agreement in
the same form and content, and with the same expiration date, as this agreement;
and PROVIDED FURTHER, HOWEVER, that the undersigned may (X) offer, pledge, sell,
contract to sell, sell any option or contract to purchase, purchase any option
or contract to sell, grant any option, right or warrant for the sale of, or
otherwise dispose of or transfer, directly or indirectly, shares of Common Stock
that the undersigned purchases in the open market after the Commencement Date
(the "Freely Tradable Shares") without any restrictions or (Y) enter into any
swap or any other agreement or any transaction that transfers, in whole or in
part, directly or indirectly, the economic consequence of Freely Tradable
Shares.
This Agreement shall lapse and become null and void if the Commencement
Date shall not have occurred on or before March 31, 2001.
Very truly yours,
Signature:
------------------------------
FORM OF LOCK-UP AGREEMENT PURSUANT TO SECTION 5(i)
Exhibit ▇-▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
CIBC Worldmarkets and
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners
as U.S. Representative(s) of the several
U.S. Underwriters to be named in the
Within-mentioned U.S. Purchase Agreement
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
North Tower
World Financial Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: PROPOSED PUBLIC OFFERING BY EXACT CORPORATION
Dear Sirs:
The undersigned, a stockholder of Exact Corporation (the "COMPANY"),
understands that ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated ("▇▇▇▇▇▇▇ ▇▇▇▇▇") and CIBC World Markets and ▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners
propose to enter into a U.S. Purchase Agreement (the "U.S. PURCHASE AGREEMENT")
with the Company providing for the public offering of shares (the "SECURITIES")
of the Company's common stock, par value $.01 per share (the "COMMON STOCK"). In
recognition of the benefit that such an offering will confer upon the
undersigned as a stockholder of the Company, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned agrees with each underwriter to be named in the U.S. Purchase
Agreement that, during the period commencing on the date of the U.S. Purchase
Agreement (the "Commencement Date") and ending 180 days thereafter, the
undersigned will not, without the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇,
directly or indirectly, (i) offer, pledge, sell, contract to sell, sell any
option or contract to purchase, purchase any option or contract to sell, grant
any option, right or warrant for the sale of, or otherwise dispose of or
transfer any shares of the Company's Common Stock or any securities convertible
into or exchangeable or exercisable for Common Stock, whether now owned or
hereafter acquired by the undersigned or with respect to which the undersigned
has or hereafter acquires the power of disposition, or file any registration
statement under the Securities Act of 1933, as amended, with respect to any of
the foregoing or (ii) enter into any swap or any other agreement or any
transaction that transfers, in whole or in part, directly or indirectly, the
economic consequence of ownership of the Common Stock, whether any such swap or
transaction is to be settled by delivery of Common Stock or other securities, in
cash or otherwise; provided, however, that the undersigned may transfer shares
of Common Stock or options to purchase shares of Common Stock (i) if the
undersigned is an individual, pursuant to a bona fide gift to the undersigned's
immediate family members, trusts for the benefit of such person or immediate
family members and partnerships in which such person and immediate family
members are the only partners and (ii) if the undersigned is a corporation,
partnership, limited liability company or other form of business entity, to a
partner or member such entity or the estate of any such partner or member, or to
an affiliate of the undersigned, in each case, only if such transferee executes
and delivers to ▇▇▇▇▇▇▇ ▇▇▇▇▇ an agreement in the same form and content, and
with the same expiration date, as this agreement.
This Agreement shall lapse and become null and void if the Commencement
Date shall not have occurred on or before March 31, 2001.
Very truly yours,
Signature:
-------------------------------
Exhibit D
FORM OF OPINION OF COMPANY'S REGULATORY COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(b)
_________, 2001
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
CIBC World Markets Corp.
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC
As Representatives of the several U.S. Underwriters
c/o Merrill Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Re: EXACT Sciences Corporation
SHARES OF COMMON STOCK
Ladies and Gentlemen:
We have acted as special regulatory counsel for EXACT Sciences
Corporation, a Delaware corporation (the "COMPANY"), with respect to U.S. Food
and Drug Administration ("FDA") regulatory matters in connection with the sale
by the Company to the several underwriters (the "U.S. UNDERWRITERS") named in
SCHEDULE I to the U.S. Purchase Agreement dated __________, 2001 (the "U.S.
PURCHASE AGREEMENT") among you, as Representatives of the Underwriters, and the
Company of an aggregate of ________ shares (the "INITIAL U.S. SECURITIES") of
the Company's common stock, par value $.01 per share (the "COMMON STOCK"), and
up to an aggregate of ___ shares of Common Stock issuable pursuant to an
over-allotment option granted to the U.S. Underwriters, (the "U.S. OPTION
SECURITIES," and together with the Initial U.S. Securities, the "U.S.
SECURITIES") and the sale by the Company to ▇▇▇▇▇▇▇ ▇▇▇▇▇ International, CIBC
World Markets plc, and ▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC pursuant to the International
Purchase Agreement, dated January__, 2001 (the "INTERNATIONAL PURCHASE
AGREEMENT", and together with the U.S. Purchase Agreement, the "PURCHASE
AGREEMENTS"), among the Company and the International Managers of ___ shares
(the "INITIAL INTERNATIONAL SECURITIES") of the Common Stock and up to an
aggregate of __ shares of Common Stock issuable pursuant to an over-allotment
option granted to the International Managers (the "INTERNATIONAL OPTION
SECURITIES", and together with the Initial International Securities, the
"INTERNATIONAL SECURITIES"). The Initial U.S. Securities and the Initial
International Securities are hereinafter called the "INITIAL SECURITIES", the
U.S. Option Securities and the International Option Securities are hereinafter
called the "OPTION SECURITIES" and the U.S. Securities and the International
Securities are hereinafter called the "SECURITIES."
This opinion is furnished to you pursuant to Section 5(b) of each of the
Purchase Agreements.
We have examined the statements included under the captions "Risk
Factors: If we fail to obtain the approval of the FDA, or comply with other FDA
requirements, we may not be able to market our products and services and may be
subject to stringent penalties" and "Business: Government Regulation" that
summarize provisions of the Federal Food, Drug, and Cosmetic Act ("FDCA"), in
(i) the Company's Registration Statement on Form S-1 (File No.
333-48812) relating to the Securities, filed with the Securities and
Exchange Commission (the "COMMISSION") on October 27, 2000 under the
Securities Act of 1933, as amended (the "SECURITIES ACT"), Amendment No.
1 thereto filed with the Commission on December 4, 2000, Amendment No. 2
thereto filed with the Commission on December 7, 2000, Amendment No. 3
thereto filed with the Commission on December 26, 2000, and Amendment No.
4 thereto filed with the Commission on January __, 2001 (such
registration statement, as so amended, being hereinafter referred to as
the "REGISTRATION STATEMENT"); and
(ii) the final U.S. prospectus (the "U.S. PROSPECTUS"), dated
January __, 2001, and the final international prospectus (the
"INTERNATIONAL PROSPECTUS", and together with the U.S. Prospectus, the
"PROSPECTUSES"), dated January __, 2001, each relating to the Securities,
in the forms filed with the Commission pursuant to Rule 424(b) of the
General Rules and Regulations under the Securities Act.
Based on and subject to the foregoing, we are of the opinion that:
1. The statements included under the captions "Risk Factors: If we
fail to obtain the approval of the FDA, or comply with other FDA
requirements, we may not be able to market our products and services and
may be subject to stringent penalties" and "Business: Government
Regulation" that summarize provisions of the Federal Food, Drug, and
Cosmetic Act ("FDCA") and implementing regulations thereunder, are
correct in all material respects and do not omit to summarize applicable
provisions of the FDCA or implementing regulations necessary to make
those statements not misleading.
2. To our knowledge, there are no FDA statutes or regulations that
are required to be described in the Prospectuses that are not described
as required.
In addition, although we have made no independent inquiry, nothing has
come to our attention that leads us to believe that the statements in the
Prospectus under the captions "Risk Factors: If we fail to obtain the approval
of the FDA, or comply with other FDA requirements, we may not be able to market
our products and services and may be subject to stringent penalties" and
"Business: Government Regulation" contain any untrue statement of a material
fact relating to the Company or omit to state any material fact relating to the
Company which is necessary to make the statements therein not misleading. As to
the matters addressed in this paragraph, we have relied without independent
investigation upon the certificate of the Company attached hereto as Appendix I.
This opinion is being furnished to you solely for your benefit in
connection with the transactions contemplated by the Purchase Agreements and may
not be used for any other purpose or relied upon by any person other than you.
Except with our prior written consent, the opinions herein expressed are not to
be used, circulated, quoted, filed with a governmental agency or otherwise
referred to in connection with any transactions other than those contemplated by
the Purchase Agreements by or to any other person. This opinion is limited to
the matters stated herein, and no opinion or belief is implied or may be
inferred beyond the matters expressly stated herein.
Very truly yours,
BUC & ▇▇▇▇▇▇▇▇▇
Appendix 1
Certificate of the Company
TABLE OF CONTENTS
PAGE
SECTION 1. Representations and Warranties.........................................................3
(a) REPRESENTATIONS AND WARRANTIES BY THE COMPANY..............................................3
(i) Compliance with Registration Requirements.........................................4
(ii) Independent Accountants...........................................................5
(iii) Financial Statements..............................................................5
(iv) No Material Adverse Change in Business............................................5
(v) Good Standing of the Company......................................................5
(vi) Good Standing of Subsidiaries.....................................................6
(vii) Capitalization....................................................................6
(viii) Authorization of Agreement........................................................6
(ix) Authorization and Description of Securities.......................................6
(x) Absence of Defaults and Conflicts.................................................7
(xi) Absence of Labor Dispute..........................................................7
(xii) Absence of Proceedings............................................................7
(xiii) Accuracy of Exhibits..............................................................8
(xiv) Possession of Intellectual Property...............................................8
(xv) Absence of Further Requirements...................................................8
(xvi) Possession of Licenses and Permits................................................8
(xvii) Title to Property.................................................................9
(xviii) Investment Company Act............................................................9
(xix) Environmental Laws................................................................9
(xx) Registration Rights..............................................................10
(b) OFFICER'S CERTIFICATES....................................................................10
SECTION 2. Sale and Delivery to U.S. Underwriters; Closing.......................................10
(a) INITIAL SECURITIES........................................................................10
(b) OPTION SECURITIES.........................................................................10
(c) PAYMENT...................................................................................11
(d) DENOMINATIONS; REGISTRATION...............................................................11
SECTION 3. Covenants of the Company..............................................................12
SECTION 4. Payment of Expenses...................................................................15
(a) PAYMENT OF EXPENSES.......................................................................15
(b) TERMINATION OF AGREEMENT..................................................................16
SECTION 5. Conditions of U.S. Underwriters' Obligations..........................................16
SECTION 6. Indemnification.......................................................................19
(a) INDEMNIFICATION OF U.S. UNDERWRITERS......................................................19
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS........................................21
(c) ACTIONS AGAINST PARTIES; NOTIFICATION.....................................................22
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE........................................22
(e) INDEMNIFICATION FOR RESERVED SECURITIES...................................................22
SECTION 7. Contribution..........................................................................23
SECTION 8. Representations, Warranties and Agreements to Survive Delivery........................24
SECTION 9. Termination of Agreement..............................................................24
(a) TERMINATION; GENERAL......................................................................24
(b) LIABILITIES...............................................................................25
SECTION 10. Default by One or More of the U.S. Underwriters.......................................25
SECTION 11. Notices...............................................................................26
SECTION 12. Parties...............................................................................26
SECTION 13. GOVERNING LAW AND TIME................................................................26
SECTION 14. Effect of Headings....................................................................26
SCHEDULES
Schedule A -- List of U.S. Underwriters
Schedule B -- Pricing Information
Schedule C-1 -- List of Persons and Entities (Other than Officers, Directors and 10% Stockholders of the
Company) Subject to Lock-up
Schedule C-2 -- List of Officers, Directors and 10% Stockholders of the Company Subject to Lock-up
EXHIBITS
Exhibit A -- Form of Opinion of Company's Counsel
Exhibit B -- Form of Opinion of Patent Counsel to the Company
Exhibit C-1 -- Form of Lock-up Agreement for Stockholders Who Are Not
Officers, Directors or 10% Stockholders of the Company
Exhibit C-2 -- Form of Lock-up Agreement for Stockholders Who Are Officers,
Directors, or 10% Stockholders of the Company
Exhibit D -- Form of Opinion of Company's Special Regulatory Counsel