EXHIBIT 1.1
LIPOSCIENCE, INC.
(a Delaware corporation)
_________ Shares of Common Stock
PURCHASE AGREEMENT
Dated: ______, 2002
Table of Contents
PURCHASE AGREEMENT
Page
SECTION 1. Representations and Warranties.................................. 2
(a) Representations and Warranties by the Company ........................ 2
(i) Compliance with Registration Requirements ....................... 2
(ii) Independent Accountants ......................................... 3
(iii) Financial Statements ........................................... 3
(iv) No Material Adverse Change in Business .......................... 4
(v) Good Standing of the Company .................................... 4
(vi) Good Standing of Subsidiaries ................................... 4
(vii) Capitalization ................................................. 4
(viii) Authorization of Agreement .................................... 5
(ix) Authorization and Description of Securities ..................... 5
(x) Absence of Defaults and Conflicts ............................... 5
(xi) Absence of Labor Dispute ........................................ 6
(xii) Absence of Proceedings ......................................... 6
(xiii) Accuracy of Exhibits .......................................... 6
(xiv) Intellectual Property .......................................... 6
(xv) Absence of Further Requirements ................................. 7
(xvi) Possession of Licenses and Permits ............................. 7
(xvii) Accounts Receivable ........................................... 8
(xviii) Medicare Violations .......................................... 8
(xix) No Medicare Recoupment ......................................... 8
(xx) Regulatory Filings .............................................. 8
(xxi) Title to Property .............................................. 9
(xxii) Investment Company Act ........................................ 9
(xxiii) Environmental Laws ........................................... 9
(xxiv) Registration Rights ........................................... 10
(xxv) Insurance ...................................................... 10
(xxvi) Tax Returns and Payment of Taxes .............................. 10
(xxvii) No Stabilization or Manipulation ............................. 10
(xxviii) Statistical and Market Data ................................. 10
(b) Officer's Certificates ............................................... 11
SECTION 2. Sale and Delivery to Underwriters; Closing ..................... 11
(a) Initial Securities .................................................. 11
(b) Option Securities ................................................... 11
(c) Payment ............................................................. 11
(d) Denominations; Registration ......................................... 12
SECTION 3. Covenants of the Company ....................................... ▇▇
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▇▇▇▇▇▇▇ ▇. Payment of Expenses ............................................ 16
SECTION 5. Conditions of Underwriters' Obligations ........................ 16
SECTION 6. Indemnification ................................................ 20
(a) Indemnification of Underwriters ..................................... 20
(b) Indemnification of Company, Directors and Officers .................. 21
(c) Actions against Parties; Notification ............................... 21
(d) Settlement without Consent if Failure to Reimburse .................. 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 Underwriters .................... 25
SECTION 11. Notices ....................................................... 25
SECTION 12. Parties ....................................................... 26
SECTION 13. GOVERNING LAW AND TIME ........................................ 26
SECTION 14. Effect of Headings ............................................ 26
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LIPOSCIENCE, INC.
(a Delaware corporation)
_________ Shares of Common Stock
PURCHASE AGREEMENT
_______, 2002
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
as Representative of the several Underwriters
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
LipoScience, Inc., 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 "Underwriters," which term shall also
include any underwriter substituted as hereinafter provided in Section 10
hereof), for whom ▇▇▇▇▇▇▇ ▇▇▇▇▇, is acting as representative (in such capacity,
the "Representative"), with respect to the issue and sale by the Company and the
purchase by the Underwriters, acting severally and not jointly, of the
respective numbers of shares of the Common Stock, par value $0.001 per share, of
the Company ("Common Stock") set forth in said Schedule A, and with respect to
the grant by the Company to the Underwriters, acting severally and not jointly,
of the option described in Section 2(b) hereof to purchase all or any part of
_________ additional shares of Common Stock to cover overallotments, if any. The
aforesaid _________ shares of Common Stock (the "Initial Securities") to be
purchased by the Underwriters and all or any part of the __________ shares of
Common Stock subject to the option described in Section 2(b) hereof (the "Option
Securities") are hereinafter called, collectively, the "Securities."
The Company understands that the Underwriters propose to make a public
offering of the Securities as soon as the Representative deems advisable after
this Agreement has been executed and delivered.
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The Company and the Underwriters agree that up to ___ shares of the
Securities to be purchased by the Underwriters (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. ("the "NASD") 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. 333-83602) 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 Agreement, the
Company will 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. The
information included in such prospectus 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
pursuant to paragraph (b) of Rule 430A is referred to as "Rule 430A
Information." Each prospectus used before such registration statement
became effective, and any prospectus that omitted the Rule 430A 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 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 prospectus in the form first furnished to
the Underwriters for use in connection with the offering of the Securities
is herein called the "Prospectus." For purposes of this Agreement, all
references to the Registration Statement, any preliminary prospectus or the
Prospectus 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 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
Underwriter, as follows:
(i) Compliance with Registration Requirements. Each of the
-----------------------------------------
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the
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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 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 Prospectus, any preliminary prospectus 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 Prospectus and such
preliminary prospectus, as amended or supplemented, if applicable, are
distributed in connection with the offer and sale of Reserved Securities.
Neither the Prospectus nor any amendments or supplements thereto (including
any prospectus wrapper), at the time the Prospectus or any such amendment
or supplement was issued and at the Closing Time (and, if any 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.
The representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement or Prospectus
made in reliance upon and in conformity with information furnished to the
Company in writing by any Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for
use in the Registration Statement or Prospectus.
Each preliminary prospectus and the Prospectus 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 Prospectus delivered to the Underwriters for
use in connection with this offering was identical in all material respects
to the electronically transmitted copies thereof filed with the Commission
pursuant to ▇▇▇▇▇, except to the extent permitted or required by Regulation
S-T.
(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 Prospectus, together with the related
schedules and notes, present fairly the financial position of the Company
at the dates indicated and the
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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. 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 Prospectus present fairly the information shown therein and have been
compiled on a basis consistent with that of the audited financial
statements included in the Registration Statement. The pro forma financial
information and the related notes thereto included in the Registration
Statement and the Prospectus present fairly the information shown therein,
have been prepared in accordance with the Commission's rules and guidelines
with respect to pro forma financial information 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 Prospectus, except as otherwise stated therein or contemplated, (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, 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, other than those in the ordinary course of business,
which are material with respect to the Company, 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
Prospectus 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
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 Subsidiaries. The Company has no "significant
-----------------------------
subsidiary" (as such term is defined in Rule 1-02 of Regulation S-X).
(vii) Capitalization. The authorized, issued and outstanding capital
--------------
stock of the Company is as set forth in the Prospectus in the column
entitled "Actual" under the caption "Capitalization" (except for subsequent
issuances, if any, pursuant to this Agreement, or pursuant to reservations,
agreements or employee benefit plans referred to in the Prospectus or
pursuant to the conversion of convertible securities or the exercise of
options or warrants referred to in the Prospectus). 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
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was issued in violation of the preemptive or other similar rights between
the Company and any security holder of the Company.
(viii) Authorization of Agreement. This Agreement has been duly
--------------------------
authorized, executed and delivered by the Company.
(ix) Authorization and Description of Securities. The Securities have
-------------------------------------------
been duly authorized for issuance and sale to the Underwriters pursuant to
this Agreement and, when issued and delivered by the Company pursuant to
this Agreement against payment of the consideration set forth herein, will
be validly issued and fully paid and non-assessable; the Common Stock
conforms to all statements relating thereto contained in the Prospectus and
such description conforms to the rights set forth in the instruments
defining the same; no 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
security holder of the Company.
(x) Absence of Defaults and Conflicts. The Company is not 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 is a party or by
which it may be bound, or to which any of the property or assets of the
Company 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 consummation
of the transactions contemplated herein 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 Prospectus
under the caption "Use of Proceeds") and compliance by the Company with its
obligations hereunder 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 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 (A) the charter or
by-laws of the Company or (B) 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 or any of its assets, properties or operations (excluding state
securities laws or the rules and regulations of the NASD as to which we
make no representation), except in the case of clause (B) hereof, such
violations that would not reasonably be expected to result in a Material
Adverse Effect. 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.
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(xi) Absence of Labor Dispute. No labor dispute with the employees of
------------------------
the Company 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 principal suppliers, manufacturers, customers
or contractors, which, in either case, would 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 affecting the Company, which is
required to be disclosed in the Registration Statement (other than as
disclosed therein), or which would reasonably be expected to result in a
Material Adverse Effect, or which would reasonably be expected to
materially and adversely affect the properties or assets thereof or the
consummation of the transactions contemplated in this Agreement or the
performance by the Company of its obligations hereunder, including without
limitation any such proceeding pursuant to federal or state laws or
regulations (a) prohibiting the payment or receipt of remuneration for
patient referrals, (b) prohibiting the filing of false claims, (c)
prescribing conditions of participation for certification by the Medicare
program and state fund programs or standards for licensure or health
planning approval, or (d) providing for reimbursement under the Medicare
and state fund programs; the aggregate of all pending legal or governmental
proceedings to which the Company is a party or of which any of its
respective property or assets is the subject which are not described in the
Registration Statement, including ordinary routine litigation incidental to
the business, would 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
Prospectus or to be filed as exhibits thereto which have not been so
described and filed as required.
(xiv) Intellectual Property. For the purposes hereof, "Intellectual
---------------------
Property" means (a) patents, patent applications and statutory invention
registrations, (b) trademarks, service marks, trade names, domain names,
trade dress, logos, and other source identifiers, (c) copyrights, (d)
computer software (other than shrink-wrap computer software), (e)
confidential and proprietary information, including trade secrets,
know-how, inventions, technology, whether patented or not, and (f)
registrations and applications for registration of the foregoing.
(A) The Company owns or has valid licenses to use, or can acquire
rights on reasonable terms to use, all Intellectual Property used in
the operation of the business currently conducted or as contemplated
to be conducted by it including, without limitation, the
Intellectual Property identified in Exhibit B hereto (collectively
the "Company Intellectual Property"), except where the failure to
own, license, or otherwise be able to acquire, or use such
Intellectual Property would not, singly or in the aggregate, have a
Material Adverse Effect. To the Company's knowledge, the Company
Intellectual Property is valid and enforceable. The Company
Intellectual Property has not been adjudged invalid or unenforceable
in whole or part. The Company has taken steps in accordance with
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normal industry practice to maintain the confidentiality of its
trade secrets and other confidential Intellectual Property.
(B) The operation of the business of the Company as currently
conducted or as presently contemplated to be conducted by it,
including services provided by, processes used by, or products
manufactured or sold by it, and the use of the Company Intellectual
Property, do not conflict with, infringe, misappropriate or
otherwise violate the Intellectual Property of any third party
(except for conflicts, infringements, misappropriations or otherwise
of any third party Intellectual Property which would not reasonably
be expected to result in a Material Adverse Effect); and no actions,
suits, claims or proceedings have been asserted, are pending or, to
the knowledge of the Company after due inquiry, threatened against
the Company (i) alleging any of the foregoing, or (ii) based upon or
challenging or seeking to deny or restrict the use by the Company of
any of the Company Intellectual Property, which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would reasonably be expected to have a Material Adverse
Effect.
(C) To the knowledge of the Company, no third party is engaging in
any activity that infringes, misappropriates or otherwise violates
the Company Intellectual Property.
(D) With respect to each material agreement governing the license to
or by the Company of any Company Intellectual Property, (i) such
agreement is valid and binding and in full force and effect; (ii)
the Company has not received any notice of termination or
cancellation under such agreement, received any notice of breach or
default under such agreement, which breach has not been cured, and
granted to any other third party any rights, adverse or otherwise,
under such agreement that would constitute a breach of such
agreement; and (iii) neither the Company or, to the Company's
knowledge, any other party to such agreement, is in breach or
default thereof in any material respect, and no event has occurred
that, with notice or lapse of time, would constitute such a breach
or default or permit termination, modification or acceleration under
such agreement.
(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 hereunder or the consummation of the transactions
contemplated by this Agreement, except (i) such as have been already
obtained or as may be required under the 1933 Act or the 1933 Act
Regulations or state securities laws or rules and regulations of the NASD
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 possesses all
----------------------------------
required permits, licenses, approvals, consents, orders, certifications and
other authorizations (collectively, "Governmental Licenses"), including,
without limitation, and as applicable,
-7-
certificates of need, licenses, Medicare provider numbers, accreditations,
certifications under the Clinical Laboratory Improvement Amendments of
1988; accreditations and other similar documentation or approvals of any
local health departments of any authority, issued by the appropriate
federal, state, local regulatory agencies or bodies necessary to conduct
the business now operated by it, except where the failure to possess such
Government Licenses or to make such declarations would not result in a
Material Adverse Effect; the Company is 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 the Company has not 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) Accounts Receivable. The accounts receivable, after giving
-------------------
effect to the allowance for doubtful accounts, relating to third party
payors do not materially exceed amounts the Company is entitled to receive.
(xviii) Medicare Violations. The Company and, to the best knowledge of
-------------------
the Company, any officers, directors or stockholders, employees or other
agents of the Company and any persons who provide professional services
under agreements with the Company, have not engaged in any activities which
are prohibited, or are cause for civil penalties or mandatory or permissive
exclusion from Medicare, under Section 1320a-7 (Program Exclusion),
1320a-7a (Civil Monetary Penalties), 1302a-7b (the Anti-kickback Statute)
or 1395nn of Title 42 of the United States Code (the "▇▇▇▇▇" law
prohibiting certain self-referrals), the federal CHAMPUS statute or the
regulations promulgated pursuant to such statutes or related state or local
statutes or regulations, standards of accreditation applicable to the
Company or rules of professional conduct, which activities would reasonably
be expected to result in sanctions (financial or otherwise) that would be
material to the Company.
(xix) No Medicare Recoupment. To the best of the Company's knowledge,
----------------------
except as described in the Prospectus, there is no Medicare or CHAMPUS
recoupment or recoupments of any other third-party payor being sought,
threatened, requested or claimed against the Company.
(xx) Regulatory Filings. Neither the Company or any of the facilities
------------------
operated by it has failed to file with applicable regulatory authorities
any statement, report, information or form required by any applicable law,
regulation or order, except where the failure to be so in compliance would
not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. Except as described in the Registration Statement,
all such filings or submissions were in compliance with applicable laws
when filed and the Company has not received notice that any deficiencies
have been asserted by any regulatory commission, agency or authority with
respect to any such filings or submissions, except for any such failures to
be in compliance or
-8-
deficiencies which would not, singly or in the aggregate, reasonably be
expected to have a Material Adverse Effect.
(xxi) Title to Property. The Company owns no real property. The
-----------------
Company has good and marketable title to all properties owned by it, in
each case, 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 Prospectus or (b) do not, singly or in the
aggregate, materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property by the
Company; and all of the leases and subleases material to the business of
the Company, and under which the Company holds properties described in the
Prospectus, are in full force and effect, and the Company has not received
any notice of any material claim of any sort that has been asserted by
anyone adverse to the rights of the Company under any of the leases or
subleases mentioned above, or affecting or questioning the rights of the
Company to the continued possession of the leased or subleased premises
under any such lease or sublease.
(xxii) 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 Prospectus
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").
(xxiii) 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, to the best of the Company's knowledge, after due
inquiry, (A) the Company is not 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, biohazardous materials, hazardous substances, petroleum or
petroleum products (collectively, "Hazardous Materials") or to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials (collectively, "Environmental
Laws"), (B) the Company has all permits, authorizations and approvals
required under any applicable Environmental Laws and is in compliance with
their requirements, (C) there are no pending or 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, 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 the Company
relating to Hazardous Materials or any Environmental Laws.
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(xxiv) 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.
(xxv) Insurance. The Company and each of the facilities owned, leased
---------
or operated by it are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are
prudent and customary in the clinical laboratory segment of the healthcare
industry; all policies of insurance and fidelity or surety bonds insuring
the Company or its respective businesses, assets, employees, officers and
directors are in full force and effect; the Company is in compliance with
the terms of such policies and instruments in all material respects; and
there are no claims by the Company under any such policy or instrument as
to which any insurance company is denying liability or defending under a
reservation of rights clause; the Company has not been refused any
insurance coverage sought or applied for; and the Company does not believe
that it will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage from similar
insurers as may be necessary to continue its business operations, except
where the failure to renew or maintain such coverage would not reasonably
be expected to result in a Material Adverse Effect.
(xxvi) Tax Returns and Payment of Taxes. The Company has timely filed
--------------------------------
all federal, state local and foreign tax returns that are required to be
filed or has duly requested extensions thereof and all such tax returns are
true, correct and complete, except to the extent that any failure to file
or request an extension, or any incorrectness would not result in a
Material Adverse Effect. The Company has timely paid all taxes shown as due
on such filed tax returns (including any related assessments, fines or
penalties), except to the extent that any such taxes are being contested in
good faith and by appropriate proceedings, or to the extent that any
failure to pay would not result in a Material Adverse Effect; and adequate
charges, accruals and reserves have been provided for in the financial
statements referred to in Section 1(a)(iii) above in accordance with GAAP
in respect of all federal, state, local and foreign taxes for all periods
as to which the tax liability of the Company has not been finally
determined or remains open to examination by applicable taxing authorities
expect (a) for taxes incurred after the date of the financial statements
referred to in Section 1(a)(iii) or (b) where the failure to provide for
such charges, accruals and reserves would not reasonably be expected to
result in a Material Adverse Effect.
(xxvii) No Stabilization or Manipulation. Neither the Company nor, to
--------------------------------
the Company's knowledge, any of its respective directors, officers or
affiliates has taken or will take, directly or indirectly, any action
designed to, or that could be reasonably expected to, cause or result in
stabilization or manipulation of the price of the Securities in violation
of Regulation M under the Securities Exchange Act of 1934, as amended (the
"1934 Act").
(xxviii) Statistical and Market Data. The statistical and
---------------------------
market-related data included in the Prospectus are derived from sources
which the Company reasonably and in good faith believes to be accurate,
reasonable and reliable in all material respects.
-10-
(b) Officer's Certificates. Any certificate signed by any officer of
the Company delivered to the Representative or to counsel for the
Underwriters in connection with or required by this Agreement shall be
deemed a representation and warranty by the Company to each Underwriter as
to the statements contained therein.
SECTION 2. Sale and Delivery to 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 Underwriter, severally and
not jointly, and each 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 Securities set forth in Schedule A opposite the name
of such Underwriter, plus any additional number of Initial Securities which
such 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
Underwriters, severally and not jointly, to purchase up to an additional
_______ 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 Securities but not
payable on the 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 overallotments which may be
made in connection with the offering and distribution of the Initial
Securities upon notice by the Representative to the Company setting forth
the number of Option Securities as to which the several Underwriters are
then exercising the option and the time and date of payment and delivery
for such Option Securities. Any such time and date of delivery (a "Date of
Delivery") shall be determined by the Representative, 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 Option Securities, each
of the Underwriters, acting severally and not jointly, will purchase that
proportion of the total number of Option Securities then being purchased
which the number of Initial Securities set forth in Schedule A opposite the
name of such Underwriter bears to the total number of Initial Securities,
subject in each case to such adjustments as the Representative 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 at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇. ▇.▇., ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, or
at such other place as shall be agreed upon by the Representative 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 Representative and the Company (such
time and date of payment and delivery being herein called "Closing Time").
-11-
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and
delivery of certificates for, such Option Securities shall be made at the
above-mentioned offices, or at such other place as shall be agreed upon by
the Representative and the Company, on each Date of Delivery as specified
in the notice from the Representative 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 Representative for the respective accounts of the
Underwriters of certificates for the Securities to be purchased by them. It
is understood that each Underwriter has authorized the Representative, for
its account, to accept delivery of, receipt for, and make payment of the
purchase price for, the Initial Securities and the Option Securities, if
any, which it has agreed to purchase. ▇▇▇▇▇▇▇ ▇▇▇▇▇, individually and not
as representative of the Underwriters, may (but shall not be obligated to)
make payment of the purchase price for the Initial Securities or the Option
Securities, if any, to be purchased by any 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 Underwriter from its
obligations hereunder.
(d) Denominations; Registration. Certificates for the Initial
Securities and the Option Securities, if any, shall be in such
denominations and registered in such names as the Representative 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 Securities and the Option Securities, if any, will be made
available for examination and packaging by the Representative in
Washington, D.C. 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
------------------------
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 and will notify the Representative promptly,
and confirm the notice in writing, (i) when any post-effective amendment
to the Registration Statement shall become effective, or any supplement
to the Prospectus or any amended Prospectus shall have been filed, (ii)
of the receipt of any comments from the Commission, (iii) of the receipt
of any request by the Commission for any amendment to the Registration
Statement or any amendment or supplement to the Prospectus or for
additional information, and (iv) of the receipt of notification 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
suspension of the qualification of the Securities for offering or sale
in any jurisdiction, 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
-12-
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
Representative notice of its intention to file or prepare any amendment
to the Registration Statement (including any filing under Rule 462(b))
or any amendment, supplement or revision to either the prospectus
included in the Registration Statement at the time it became effective
or to the Prospectus, will furnish the Representative 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 Representative or counsel for the Underwriters shall
reasonably object.
(c) Delivery of Registration Statements. The Company has
furnished or will deliver to the Representative and counsel for the
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 Representative, without charge, a conformed copy of the
Registration Statement as originally filed and of each amendment thereto
(without exhibits) for each of the Underwriters. The copies of the
Registration Statement and each amendment thereto furnished to the
Underwriters will be identical in all material respects to the
electronically transmitted copies thereof filed with the Commission
pursuant to ▇▇▇▇▇, except to the extent permitted or required by
Regulation S-T.
(d) Delivery of Prospectuses. The Company has delivered to each
Underwriter, without charge, as many copies of each preliminary
prospectus as such Underwriter 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 Underwriter, without charge,
during the period when the Prospectus is required to be delivered under
the 1933 Act or the 1934 Act, such number of copies of the Prospectus
(as amended or supplemented) as such Underwriter may reasonably request.
The Prospectus and any amendments or supplements thereto furnished to
the Underwriters will be identical in all material respects to the
electronically transmitted copies thereof filed with the Commission
pursuant to ▇▇▇▇▇, except to the extent permitted or required 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 in the Prospectus. 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 reasonable opinion of counsel
for the Underwriters or for the Company, to amend the Registration
Statement or amend or supplement the Prospectus in order that the
Prospectus 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 it is delivered to a purchaser, or if it shall be necessary, in the
reasonable opinion of such counsel, at any such time to amend
-13-
the Registration Statement or amend or supplement the 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 necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such requirements,
and the Company will furnish to the Underwriters such number of copies
of such amendment or supplement as the Underwriters may reasonably
request.
(f) Blue Sky Qualifications. The Company will use its best
efforts, in cooperation with the 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
Representative may designate and to maintain such qualifications in
effect for so long as required for the distribution of the Securities,
but in any event for a period of not more 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 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 so long as required for the
distribution of the Securities, but in any event for a period of not
more 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 security holders 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 Prospectus under "Use of Proceeds."
(i) Listing. The Company will use its best efforts to effect the
quotation of the Common Stock (including the Securities) on the Nasdaq
National Market. For the period of one year from the Closing Date, the
Company will use its best efforts to maintain the quotation of the
Common Stock (including 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 a period of 180
days from the date of the Prospectus, the Company will not, without the
prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇, (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
-14-
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. The
foregoing sentence shall not apply to (A) the Securities to be sold
hereunder, (B) 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 Prospectus, (C)
any shares of Common Stock issued or options or other rights to purchase
Common Stock granted pursuant to the existing 1997 Stock Option Plan of
the Company referred to in the Prospectus or the 2001 Employee Stock
Incentive Plan and the 2001 Employee Stock Purchase Plan that become
effective upon the effectiveness of the Registration Statement and any
registration statements filed with respect thereto, (D) any shares of
Common Stock issued pursuant to any non-employee director stock plan or
dividend reinvestment plan and any registration statements filed with
respect thereto, (E) any shares of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock issued
by the Company in connection with any acquisition by the Company or (F)
any shares of Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock in connection with any
strategic relationship or business arrangement or agreement entered into
with in furtherance of the Company's business provided, however, that
prior to any transfer described in items (E) and (F) of this paragraph,
the Company shall cause each transferee to execute and deliver to
▇▇▇▇▇▇▇ ▇▇▇▇▇, an agreement, reasonably satisfactory to ▇▇▇▇▇▇▇ ▇▇▇▇▇
pursuant to which each transferee shall agree to receive and hold such
shares or securities convertible into or exercisable or exchangeable for
Common Stock, subject to the provisions of this Section 3(j).
(k) Reporting Requirements. The Company, during the period when
the Prospectus is 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 Underwriters shall notify the
Company as to which persons will hold the Reserved Securities that will
be restricted as required by 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. 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 from such restrictions any of the Reserved
Securities (other than a release done at the request of the
Underwriters), the Company agrees to reimburse the Underwriters for any
reasonable expenses (including, without limitation, reasonable legal
expenses) they incur in connection with such release.
(m) Compliance with Rule 463. The Company will comply with Rule
463 of the 1933 Act Regulations.
-15-
(n) Medicare Filings and Notices. The Company will use its
reasonable efforts to make all required filings and provide all required
notices to update indirect ownership information that has been supplied
in connection with the Company's facilities that participate in the
Medicare program and other U.S. federal healthcare programs (the
"Medicare Filings and Notices").
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 Underwriters of this Agreement 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, (iv) the fees and disbursements of the Company's
counsel, accountants and other advisors, (v) the qualification of the
Securities under securities laws in accordance with the provisions of
Section 3(f) hereof, including filing fees 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, (vi) the printing and delivery to the Underwriters of
copies of each preliminary prospectus and of the Prospectus 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, (ix) the filing fees incident to, and the
reasonable fees and disbursements 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
reasonable costs and expenses of the Underwriters, including the reasonable
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
------------------------
Representative in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the Company shall reimburse the Underwriters for all of
their out-of-pocket expenses, including the reasonable fees and
disbursements of counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of
---------------------------------------
the several 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 any Subsidiary of the
Company 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
-16-
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 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).
(b) Opinion of Counsel for Company. At Closing Time, the
Representative shall have received the favorable opinion, dated as of
Closing Time, of each of (1) ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ PLLC, counsel for the
Company, in form and substance satisfactory to counsel for the
Underwriters, together with signed or reproduced copies of such letter for
each of the other Underwriters to the effect set forth in Exhibit A-1
hereto and to such further effect as counsel to the Underwriters may
reasonably request; (2) ▇▇▇▇ and ▇▇▇▇ LLP, special counsel for the Company,
in form and substance satisfactory to counsel for the Underwriters,
together with signed or reproduced copies of such letter for each of the
other Underwriters to the effect set forth in Exhibit A-2 hereto and to
such further effect as counsel to the Underwriters may reasonable request;
(3) ▇▇▇▇▇ Bigel Sibley & Sajovec, P.A., intellectual property counsel for
the Company, in form and substance satisfactory to counsel for the
Underwriters, together with signed or reproduced copies of such letter for
each of the other Underwriters to the effect set forth in Exhibit B hereto
and to such further effect as counsel to the Underwriters may reasonably
request; and (4) Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.,
special regulatory counsel for the Company for the sales of Securities
pursuant to the Purchase Agreement, in form and substance satisfactory to
counsel for the Underwriters, together with signed or reproduced copies of
such letter for each of the other Underwriters to the effect set forth in
Exhibit C hereto and to such further effect as counsel to the Underwriters
may reasonably request.
(c) Opinion of Counsel for Underwriters. At Closing Time, the
Representative shall have received the favorable opinion, dated as of
Closing Time, of Shearman & Sterling, counsel for the 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" and "Underwriting") and the
penultimate paragraph of Exhibit A-1 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 and the General Corporation Law of the State of Delaware,
upon the opinions of counsel satisfactory to the Representative. 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 certificates of public
officials.
-17-
(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 Prospectus, any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company, whether or not arising in the ordinary course of
business, and the Representative shall have received a certificate of the
President or a Vice President of the Company and of the chief financial or
chief accounting 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 Representative shall have received from Ernst & Young LLP a
letter dated such date, in form and substance satisfactory to the
Representative, together with signed or reproduced copies of such letter
for each of the other 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 Prospectus.
(f) Bring-down Comfort Letter. At Closing Time, the Representative
shall have received from Ernst & Young 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 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
Representative shall have received an agreement substantially in the form
of Exhibit D hereto signed by the persons listed on Schedule C hereto.
(j) Medicare Filings. All Medicare Filings and Notices required to be
made prior to Closing Time shall have been made or provided.
(k) Conditions to Purchase of Option Securities. In the event that the
Underwriters exercise their option provided in Section 2(b) hereof to
purchase all or any portion of the Option Securities, the representations
and warranties of the Company
-18-
contained herein and the statements in any certificates furnished by the
Company or any Subsidiary hereunder shall be true and correct as of each
Date of Delivery and, at the relevant Date of Delivery, the Representative
shall have received:
(i) Officers' Certificate. A certificate, dated such Date of Delivery,
---------------------
of the President or a Vice President of the Company and of the chief
financial or chief accounting officer of the Company confirming that
the certificate delivered at the 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 of
------------------------------
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ PLLC, counsel for the Company, and ▇▇▇▇ and ▇▇▇▇
LLP, special counsel for the company, together with the favorable
opinion of ▇▇▇▇▇ Bigel Sibley & Sajovec, P.A., intellectual property
counsel for the Company and Mintz, Levin, Cohn, Ferris, Glovsky and
Popeo, P.C., regulatory counsel for the Company for the sale of
Securities pursuant to the Purchase Agreement, each in form and
substance satisfactory to counsel for the Underwriters, dated such
Date of Delivery, relating to the Option Securities to be purchased on
such Date of Delivery and otherwise to the same effect as the opinion
required by Section 5(b) hereof.
(iii) Opinion of Counsel for Underwriters. The favorable opinion of
-----------------------------------
Shearman & Sterling, counsel for the Underwriters, dated such Date of
Delivery, relating to the Option Securities to be purchased on such
Date of Delivery and otherwise to the same effect as the opinion
required by Section 5(c) hereof.
(iv) Bring-down Comfort Letter. A letter from Ernst & Young LLP, in
-------------------------
form and substance satisfactory to the Representative and dated such
Date of Delivery, substantially in the same form and substance as the
letter furnished to the Representative 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 five days
prior to such Date of Delivery.
(l) Additional Documents. At Closing Time and at each Date of
Delivery, counsel for the 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 Representative and counsel for
the 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 Option
Securities on a Date of Delivery which is after the Closing Time, the
obligations of the several Underwriters to purchase the relevant
-19-
Option Securities, may be terminated by the Representative 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 8 shall survive any such termination and remain in
full force and effect.
SECTION 6. Indemnification.
---------------
(a) Indemnification of Underwriters. The Company agrees to indemnify and
-------------------------------
hold harmless each Underwriter and each person, if any, who controls any
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, 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 prospectus or the Prospectus (or any amendment or
supplement thereto), or the omission or alleged 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 Prospectus or preliminary
prospectus, 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 reasonable 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
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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 Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use
in the Registration Statement (or any amendment thereto), including the
Rule 430A Information, or any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto) and (b) with respect to any
preliminary prospectus to the extent any such loss, liability, claim,
damage or expense of any Underwriter results solely from the fact that such
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 thereof promptly and in sufficient quantity
to such Underwriter (in compliance with Section 3(d) hereof) and the loss,
liability, claim, damage or expense of such Underwriter results from an
untrue statement or omission of a material fact contained in the
preliminary prospectus that was corrected in the Prospectus.
(b) Indemnification of Company, Directors and Officers. Each
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, or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Company by such
Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ expressly for use in the Registration
Statement (or any amendment thereto) or such preliminary prospectus or the
Prospectus (or any amendment or supplement thereto).
(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
-21-
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. The indemnifying party shall control the
defense and/or settlement of any claim, provided that the indemnified party
may choose its own counsel in the event of a conflict, and provided further
that the indemnifying party shall not, 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.
(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 and hold harmless the 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 the 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.
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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 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 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
Underwriters on the other hand in connection with the offering of the
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
Securities pursuant to this Agreement (before deducting expenses) received
by the Company and the total underwriting discount received by the
Underwriters, in each case as set forth on the cover of the Prospectus,
bear to the aggregate initial public offering price of the Securities as
set forth on such cover.
The relative fault of the Company on the one hand and the 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 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 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 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 reasonable 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 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 Underwriter shall
be required to contribute any amount in excess of the amount by which the
total price at which the Securities underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages
which such Underwriter has otherwise been required to pay by reason of any
such untrue or alleged untrue statement or omission or alleged omission.
-23-
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 an
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
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 Underwriters' respective obligations to contribute
pursuant to this Section are several in proportion to the number of Initial
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 any Subsidiary
submitted pursuant hereto shall remain operative and in full force and
effect, regardless of any investigation made by or on behalf of any
Underwriter or controlling person, or by or on behalf of the Company, and
shall survive delivery of the Securities to the Underwriters.
SECTION 9. Termination of Agreement.
------------------------
(a) Termination; General. The Representative 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
Prospectus (exclusive of any supplement thereto), any material adverse
change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company 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 in 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 judgment of the Representative, impracticable or
inadvisable 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 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
National Association of Securities Dealers, Inc. or any other governmental
authority, or a material disruption has occurred in commercial banking or
securities settlement or clearance services in the United States, or (iv)
if a banking moratorium has been declared by either Federal or New York
authorities.
-24-
(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 8 shall survive such termination and remain in
full force and effect.
SECTION 10. Default by One or More of the Underwriters. If one or more
------------------------------------------
of the 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 Representative shall have
the right, within 24 hours thereafter, to make arrangements for one or more
of the non-defaulting 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
Representative 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 Securities to be purchased on such date, the
non-defaulting 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 Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the
number of 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 Underwriters to purchase and of the Company to
sell the Option Securities to be purchased and sold on such Date of
Delivery shall terminate without liability on the part of any
non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from the 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 Underwriters to purchase and the Company to sell the
relevant Option Securities, as the case may be, either the Representative
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 Prospectus or in any other documents or arrangements. As used
herein, the term "Underwriter" includes any person substituted for an
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
Underwriters shall be directed to the Representative at ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, attention of [▇▇▇▇▇ ▇▇▇▇
(telecopier no. 212-449-7171)]; and notices to the Company shall be
directed to it at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, attention of [F. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇].
-25-
SECTION 12. Parties. This Agreement shall inure to the benefit of and
-------
be binding upon the 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
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 Underwriters and the Company and their respective successors, and said
controlling persons and officers and directors and their heirs and legal
representative, and for the benefit of no other person, firm or
corporation. No purchaser of Securities from any 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 Underwriters and the Company in accordance
with its terms.
Very truly yours,
LIPOSCIENCE, INC.
By_________________________________
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By___________________________________
Authorized Signatory
For itself and as Representative of the other Underwriters named in
Schedule A hereto.
-27-
SCHEDULE A
Number of
Initial
Name of Underwriter Securities
------------------- ----------
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated...............................
U.S. Bancorp ▇▇▇▇▇ ▇▇▇▇▇▇▇......................................
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC......................................
Pacific Growth Equities, Inc....................................
---------
Total........................................................... ---
=========
SCHEDULE B
LIPOSCIENCE, INC.
_________ Shares of Common Stock
(Par Value $0.001 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 Securities to be paid by the
several 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 Option Securities purchased upon the exercise
of the overallotment 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 Securities but not payable on the Option Securities.
Form of lock-up from directors, officers or other stockholders pursuant to
Section 5(i)
Exhibit D
_______, 2002
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated,
▇▇▇▇▇▇▇ Sachs & Co.
as Representative of the several
Underwriters to be named in the
within-mentioned Purchase Agreement
▇/▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Re: Proposed Public Offering by LipoScience, Inc.
---------------------------------------------
Dear Sirs:
The undersigned, a stockholder and/or an officer and/or director of
LipoScience, Inc., a Delaware corporation (the "Company"), understands that
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
("▇▇▇▇▇▇▇ ▇▇▇▇▇") proposes to enter into a Purchase Agreement (the "Purchase
Agreement") with the Company providing for the public offering (the "Offering")
of shares (the "Securities") of the Company's common stock, par value $0.001
(the "Common Stock"). In recognition of the benefit that such an offering will
confer upon the undersigned as a stockholder and/or an officer and/or director
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 Purchase Agreement that, during a period of 180
days from the date of the Purchase Agreement, 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
-i-
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 this sentence shall not apply to any (a) bona fide
gifts, provided that the donee or donees or, in the case of a minor donee, such
minor's legal guardian on such minor's behalf agree in writing to be bound by
the terms of this restriction, or (b) transfers to the ancestors, descendants,
siblings, children or siblings of spouse, or if the undersigned is a
partnership, limited liability company or corporation, to the partners, members
or stockholders of such partnership, limited liability company or corporation,
as the case may be, in each case, provided that the transferee or transferees
or, in the case of a minor transferee, such minor's legal guardian on such
minor's behalf agree in writing to be bound by the terms of this restriction.
Very truly yours,
Signature:___________________________
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