Document:

Exhibit 10.1

 

SEPARATION AGREEMENT AND GENERAL RELEASE

 

This Separation Agreement and General Release (this “Agreement”) is hereby made and entered into as of the 7th day of June, 2013 (the “Effective Date”), by and between Laura Stoltenberg (“Employee”) and Exact Sciences Corporation (the “Company”).  Where appropriate, the signatories to this Agreement will be referred to individually as “Party” and collectively as the “Parties.”

 

The term “Released Party” or “Released Parties” as used in this Agreement shall mean the Company, and shall also include its respective successors in name, successors in interest, assigns, predecessors in name, predecessors in interest, shareholders, present and former subsidiaries, parents, related corporations, joint ventures, affiliates, funds and/or portfolios, and present directors, trustees, officers, agents, representatives, insurers and employees of these entities, and any and all employee pension or welfare benefit plans of these entities, including current and former trustees and administrators of these plans.

 

WHEREAS, Employee is currently employed by the Company and serves as its Senior Vice President, Chief International Officer;

 

WHEREAS, Employee and the Company are parties to an Employment Agreement effective as of March 19, 2012 (“Employment Agreement”);

 

WHEREAS, Employee and the Company have mutually agreed that Employee shall resign from her employment with the Company and all positions with the Company effective June 7, 2013 ( “Separation Date”), subject to the terms and conditions of this Agreement;

 

WHEREAS, the Parties desire to settle all claims and issues that have, or could have been raised by Employee in relation to Employee’s employment with the Company and arising out of or in any way related to the acts, transactions, or occurrences between Employee and the Company to date, including, but not limited to, Employee’s employment with the Company or the termination of that employment, on the terms set forth herein; and

 

WHEREAS, by entering into this Agreement, no Party admits that she or it has done anything wrong;

 

NOW, THEREFORE, in consideration of the mutual promises contained herein and other good and valuable consideration, the sufficiency of which is hereby acknowledged, the Parties agree as follows:

 

1.                                      Severance Package.  In exchange for the promises set forth herein, the Company agrees to provide the following payments and benefits to Employee (“Severance Package”).  Employee agrees that this Severance Package shall be in lieu of any payments and benefits to which Employee would be entitled under the Employment Agreement.  Employee further acknowledges and agrees that the Severance Package constitutes adequate legal consideration for the promises and representations made by Employee in this Agreement, and that Employee would not be entitled to the Severance Package but for this Agreement.

 

 

(a)                                 Severance Payment. The Company agrees to provide Employee with severance payments equal in sum to twelve (12) months of Employee’s current base salary of Three Hundred Twenty Thousand Dollars and no cents ($320,000.00), less all applicable federal and state tax withholdings and other withholdings required by law (the “Severance Payment”).  The Severance Payment will be paid on the following schedule:

 

(i)                                     Eighteen Thousand Four Hundred Sixty Two Dollars and no cents ($18,462.00) (less all applicable federal and state tax withholdings and other withholdings required by law), payable on June 13, 2013;

 

(ii)                                  One Hundred Forty One Thousand Five Hundred Thirty Eight Dollars and no cents ($141,538.00) (less all applicable federal and state tax withholdings and other withholdings required by law), payable on the Company’s first regular pay date that is on or after July 1, 2013; and

 

(iii)                               One Hundred Sixty Thousand Dollars and no cents ($160,000.00) less all applicable federal and state tax withholdings and other withholdings required by law), payable on the Company’s first regular pay date that occurs on or after January 1, 2014.

 

(b)                                 Continuation of Group Health Benefits.  Provided that Employee elects to continue her group health insurance coverage pursuant to the applicable provisions of the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), and remains eligible for these benefits, the Company agrees to reimburse Employee for the COBRA premiums required to continue the group health care coverage for Employee and those dependents of Employee who were enrolled in the Company’s group health care coverage as of the Separation Date, for COBRA coverage through no later than June 30, 2014 (the “COBRA Period”).  To the extent that Employee becomes eligible for group health care coverage from a subsequent employer during the COBRA Period, the Company’s obligations to make COBRA payments shall cease.  Employee agrees to notify the Company within one week of becoming eligible for group health insurance coverage through another employer.

 

(c)                                  Bonus.  Employee shall be entitled to a guaranteed bonus for calendar year 2013 in the amount of One Hundred Thousand Dollars and no cents ($100,000.00), payable in 2014 at the time established by the Company’s Board of Directors for payment of 2013 executive bonuses.

 

(d)                                 Outplacement and Relocation Assistance.  Within thirty (30) days of the Effective Date, the Company shall pay Employee One Hundred Thousand Dollars and no cents ($102,500.00) towards the cost of an outplacement consulting package and relocation assistance for Employee, which shall be timely reported on one or more IRS Form(s) 1099 issued to “LAURA STOLTENBERG.”

 

(e)                                  Retention as a Consultant.  The Company shall retain Employee as a consultant for a period of up to three (3) years (“Consultancy Period”) pursuant to a separate consulting agreement (the “Consulting Agreement”) to be entered into by the Parties simultaneously with the execution of this Agreement.

 

(f)                                   Acceleration of Vesting of Stock Awards.  The Parties acknowledge that Employee had 48,125 vested restricted stock unit awards (“RSUs”) immediately prior to the

 

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Effective Date.  The Company shall cause the vesting of the following outstanding and unvested RSUs upon the following schedule:

 

(i)                                     41,250 RSUs (originally granted on March 19, 2012) shall vest upon the Effective Date;

 

(ii)                                  10,000 RSUs (originally granted on March 19, 2012), shall vest on March 19, 2014;

 

(iii)                               Unless and until Employee voluntarily terminates the Consulting Agreement, then as additional consideration for Employee’s services thereunder: 48,750 RSUs (originally granted on March 19, 2012) shall vest in twenty-four (24) equal monthly installments at the rate of 2,032 per month (with 2,014 vesting in the last installment), commencing on April 19, 2014, in accordance with the Employment Agreement (which provides for acceleration of vesting upon a “Change of Control,” as defined therein) and that certain 2010 Omnibus Long-Term Incentive Plan Restricted Stock Unit Award Agreement between the Parties dated as of March 19, 2012 (the “RSU Grant Agreement”), but adjusted to reflect the modification in the number of RSUs and the vesting schedule effected by this Agreement.  If the Consultancy Period terminates before any or all of the RSUs have vested in accordance with this subparagraph 1(f)((ii), then Employee’s entitlement to vesting of any RSUs then unvested shall at that time immediately cease.

 

(iii)                               Other than RSUs vesting in accordance with clauses (i) and (ii) above, all other Company equity awards granted to Employee are hereby cancelled and forfeited in their entirety.

 

(g)                                  Attorneys’ Fees. The Company will pay the reasonable fees of Employee’s counsel,  Kaiser Saurborn & Mair, P.C., 111 Broadway, New York, NY 10006 (“Kaiser”) within ten (10) days after the date of receipt by counsel for the Company (K&L Gates LLP) of a completed IRS Form W-9 from Kaiser, in full settlement of any claims Employee may have for attorneys’ fees and/or costs (the “Attorneys’ Fees Payment”).  The Attorneys’ Fees Payment shall be timely reported on an IRS Form 1099 issued to “KAISER SAURBORN & MAIR, P.C.”

 

(h)                                 No Other Company Obligations.  Employee agrees that other than as expressly stated in this Paragraph 1, she will not seek anything further from the Company or the Released Parties, including any other payment.  Employee further agrees that except as expressly set forth in this Agreement, all benefits, wages, bonuses, commissions, compensation, or other payments provided to Employee during her employment with the Company shall cease as of the Separation Date and that Employee shall not receive any payments from the Company other than as expressly set forth in this Paragraph 1 of this Agreement.

 

2.                                      Restriction on Stock Sales.  Employee agrees that she shall be prohibited from selling any shares of the Company stock until at least ninety-one (91) days have elapsed following the Effective Date and that the shares issued to her upon vesting of RSUs pursuant to Section 1(f)(i) shall bear an appropriate legend concerning such prohibition.

 

3.                                      No Representations as to Tax Consequences.  Employee expressly understands and agrees that the Released Parties and their counsel have made no representations to Employee

 

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or her counsel regarding the tax implications of the Severance Package.  Employee further understands and agrees that, in the event the Internal Revenue Service or any other taxing authority, including, but not limited to, the State of Wisconsin, or any court or other tribunal of competent jurisdiction (each, a “Taxing Authority”), ultimately determines that any Taxes remain due and owing by Employee with respect to the Severance Package, Employee shall be solely responsible for the payment of such Taxes due and owing by Employee, and she shall make no claim against the Released Parties for payment of any such Taxes.  In addition, Employee agrees (a) to indemnify, defend and hold harmless each Released Party against any liability that may be asserted against such Released Party by a Taxing Authority for Taxes with respect to the Severance Package, and (b) to cooperate with such Released Party in the defense of any proceeding by a Taxing Authority relating to such Taxes, including by providing proof of Employee’s payment of Taxes with respect to the Severance Package.  Employee agrees that in the event it is ultimately determined that any Taxes are due and owing with respect to the Severance Package, the validity of this Agreement shall not be affected in any way.  For purposes of this Agreement, “Tax” means any federal, state, local or foreign income, gross receipts, excise, franchise, employment, payroll, withholding, alternative or add-on minimum tax, or other tax, custom, duty, governmental fee or other like assessment or charge of any kind whatsoever, together with any interest or penalty imposed by any Taxing Authority.

 

4.                                      Employee’s General Release of Claims.  In consideration for the promises contained herein and other good and valuable consideration, receipt of which is hereby acknowledged, Employee completely releases, acquits and forever discharges the Company and all Released Parties from and against all causes of action, claims, judgments, obligations, damages, or liabilities of whatever kind and character, known or unknown, from the beginning of time through the date that this Release is executed, including, without limitations, causes of action arising under any of the following:

 

Rehabilitation Act of 1973;

National Labor Relations Act;

Fair Labor Standards Act;

Employee Retirement Income Security Act of 1974;

Consolidated Omnibus Budget Reconciliation Act (COBRA);

Civil Rights Act of 1866;

Title VII of the Civil Rights Act of 1964, as amended by the Civil Rights Act of 1991;

Pregnancy Discrimination Act of 1978;

Immigration Reform Control Act;

Equal Pay Act of 1963;

Americans with Disabilities Act of 1990;

Family and Medical Leave Act of 1993;

Occupational Safety and Health Act of 1970;

Sarbanes-Oxley Act

Dodd-Frank Wall Street Reform and Consumer Protection Act

Wisconsin Fair Employment Act

 

Any other federal, state or local law or regulation or any provision of common law governing any kind of discrimination, harassment, retaliation or whistleblower claim; any other federal, state or local law or regulation or any common law governing the payment of wages, commissions, bonuses or any other form of compensation; or common law, including but not limited to all claims regarding wrongful termination, discharge in

 

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violation of public policy, free speech, defamation, misrepresentation, breach of contract, breach of the implied covenant of good faith and fair dealing, intentional or negligent infliction of emotional distress, and/or personal injury;

 

Any other Federal, state or local statute, law or ordinance whatsoever;

 

Any other claim or cause of action against the Company or any other Released Party; or any other action whether cognizable in law or in equity or arising under any common law, tort, or contract theory;

 

Any and all claims for compensatory damages, punitive damages, attorneys’ fees, costs, and/or interest.

 

Employee further agrees to release, waive, and forever discharge her right to any portion of any settlement, judgment, or other recovery as a Relator under the qui tam provisions of the False Claims Act, 31 U.S.C. § 3730, or analogous state false claims acts, in any lawsuit arising from, or in any way related to, any transactions or occurrences involving the Company or any Released party, from the beginning of time until the present, regardless of whether those transactions or occurrences relate in any way to the subject matter of this Release, including but not limited to, any right to receive expenses, attorney’s fees, and costs under 31 U.S.C. § 3730(d), or analogous state laws.

 

5.                                      Release Representations, Warranties and Covenants.

 

(a)                                 With respect to any matters released pursuant to Paragraph 4 of this Agreement, Employee represents, warrants and covenants that she has not and will not in the future commence, maintain, or prosecute, cause to be commenced, maintained, or prosecuted, or voluntarily assist or participate (except in response to subpoena or judicial order) in the commencement, maintenance, or prosecution of any complaint, charge, action, suit, administrative proceeding, enforcement investigation or proceedings, grievances, arbitrations, or claims or proceedings of any kind against the Company or any Released Party, in any forum, that in any manner whatsoever involves allegations or facts that were or could have been raised by Employee in any forum on or before the Effective Date.

 

(b)                                 Employee further represents, warrants and covenants that there are no pending or outstanding administrative or judicial proceedings, charges, complaints, claims or actions by Employee as against any Released Party, or which are maintained on behalf of Employee as against any Released Party, in any forum or governmental agency.  Employee expressly acknowledges that the Company is relying upon this representation, warranty and covenant in entering into this Agreement.

 

(c)                                  Nothing herein shall be construed to prevent any Party from bringing an action or proceeding seeking enforcement of this Agreement, or using this Agreement as evidence in a subsequent proceeding in which one of the Parties alleges a breach of this Agreement.

 

6.                                      Awareness and Voluntary Nature of Release and Release Representations, Warranties and Covenants.  Employee hereby acknowledges and agrees that the Release and Release Representations, Warranties and Covenants set forth in Paragraphs 4 and 5 are general

 

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releases and release representations, warranties and covenants; that Employee understand the terms and contents of the Release, Release Representations, Warranties and Covenants, and this Agreement; and that she freely, voluntarily and without coercion enter into this Agreement.

 

7.                                      Compromise.  The Parties agree and acknowledge that this Agreement is the result of a compromise of disputed claims and shall never be construed as an admission of liability, wrongdoing or responsibility on the part of any Party.  Subject to Paragraph 24(b) of this Agreement, the Parties specifically recognize and agree that no Party shall, by virtue of entering into this Agreement, be considered a “prevailing party” for any purpose, including for purposes of any statute that provides for an award of attorneys’ fees to a prevailing party.

 

8.                                      Confidentiality of Agreement.

 

(a)                                 Employee agrees that the terms and conditions of this Agreement and the Consulting Agreement, and the facts and circumstances leading up to this Agreement and the Consulting Agreement, shall remain confidential as between the Parties.  Employee further agrees that she shall not disclose the fact of this Agreement or the Consulting Agreement, terms and conditions of this Agreement or the Consulting Agreement, or the facts and circumstances leading up to this Agreement or the Consulting Agreement, to any other person except (i) by written agreement of the Released Parties, (ii) pursuant to valid court order or subpoena, (iii) as required by law; (iv) as necessary to enforce any of the terms of this Agreement or the Consulting Agreement; or (v) to her spouse, attorneys, and/or tax advisors, who shall likewise be bound by this provision.  Without limiting the generality of the foregoing, Employee will not respond to or in any way participate in or contribute to any public discussion, notice, or other publicity concerning, or in any way relating to, this Agreement or the Consulting Agreement, the facts and circumstances leading up to this Agreement or the Consulting Agreement, or the terms and conditions of this Agreement or the Consulting Agreement, except as set forth in Paragraph 12 below.

 

(b)                                 Subpoena.  If Employee is served with a subpoena or any demand to produce this Agreement or the Consulting Agreement, or any information relating to same, she shall provide prompt written notice of such request to the Released Parties in order to afford the Released Parties an opportunity to evaluate their legal rights and take such action as they consider to be appropriate to protect their interests.  Notice to the Released Parties shall be provided to:  the Company’s Chief Operating Officer with a copy to Scott Coward of K&L Gates, LLP.

 

9.                                      Non-Disparagement.

 

(a)                                 Employee agrees that she will not in any way disparage any of the Released Parties, or make or solicit any comments, statements, or the like to the media or to others that would, by a reasonable person, considered to be derogatory or detrimental to the good name or business reputation of any of the Released Parties.

 

(b)                                 The Company agrees that its Named Executive Officers (as defined in the Securities Exchange Act of 1934) and Directors shall not disparage Employee, or make or solicit any comments, statements, or the like to the media or to others that would, by a reasonable person, be considered to be derogatory or detrimental to the good name or business reputation of Employee.  Nothing in this Paragraph shall prevent the Company or other Released Parties from

 

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providing truthful information as necessary or appropriate to satisfy any public reporting obligations that the Company or the other Released Parties may have pursuant to any laws, rules or regulations administered by the U.S. Securities and Exchange Commission (“SEC”) or the U.S. Food and Drug Administration (“FDA”); from providing truthful information to investigators or any government agency to satisfy any reporting obligations the Company may have or in response to any lawful inquiry from a government agency; or from providing truthful information to employees, advisors, representatives, investment bankers, investors and/or potential investors.

 

(c)                                  The Parties agree that the Company shall respond to employment inquiries concerning Employee only by confirming dates of employment, position, and salary.

 

10.                               Non-Disclosure and Invention Agreement.  Employee acknowledges that she entered into a Non-Disclosure and Invention Agreement dated as of March 16, 2012 (copy annexed hereto as Exhibit A) (“Non-Disclosure and Invention Agreement”) and that her employment with the Company and continued services to the Company during the Consultancy Period have provided her and will continue to provide her with access to and intimate knowledge of “Confidential Information,” as that term is defined in the Non-Disclosure and Invention Agreement.  Employee hereby reaffirms all of her obligations under the Non-Disclosure and Invention Agreement.

 

11.                               Agreement Not to Compete/Restrictions Against Solicitation.

 

(a)                                 As further consideration for the mutual promises set forth in this Agreement, the Company agrees to release Employee from her obligations under Section 8.2 (“Agreement Not to Compete”) of her Employment Agreement, and replace said obligations with the obligations set forth in Paragraph 11(b) and 11(c) of this Agreement.

 

(b)                                 Employee agrees that for the period of twelve (12) months following the Effective Date, and thereafter for the duration of the Consultancy Period (unless the Consulting Agreement is terminated earlier), Employee will not, directly or indirectly, without the Company’s prior written consent:  (i) provide Competing Services (defined in Paragraph 11(c) below) to or for any individual or entity in any Restricted Area; or (ii) in any Restricted Area, advise, assist, participate in, perform services for, or consult with another individual or entity with regard to Competing Services, including without limitation Competing Services relating to the management, operations, business or financial strategy, marketing or sales function or product development (including without limitation clinical trials) of such individual or entity (the activities in clauses (i) and (ii) collectively are the “Restricted Activities”).  Employee acknowledges that in her position with the Company she has had access to knowledge of confidential information about all aspects of the Company that would be of significant value to the Company’s competitors.

 

(c)                                  As used in Paragraph 11(b), the following definitions apply:

 

(i)                                     “Competing Services” means the provision of services related to the development, design, manufacture, marketing, distribution or sale of molecular diagnostic products related to the gastrointestinal tract;

 

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(ii)                                  “Restricted Area” means any geographic location where if Employee were to perform any Restricted Activities in such a location, the effects of such performance would be competitive to the Company.

 

(d)                                 Consent/Confirmation of No Competing Services.  Should Employee seek Company’s consent to perform Competing Services during the period specified in Paragraph 11(b), or should Employee request Company’s consent to provide services that do not involve the provision of Competing Services during the period specified in Paragraph 11(b), she shall provide written notice of such request the Company’s Chief Operating Officer with a copy to Scott Coward of K&L Gates, LLP.  Company shall respond to such written requests in writing within five (5) business days.  Provided that the contemplated services do not actually involve the provision of Competing Services during the period specified in Paragraph 11(b), Company shall not unreasonably withhold consent under this Paragraph 11(d).

 

(e)                                  Restriction Against Solicitation.  Employee further agrees that for the period of twelve (12) months following the Effective Date, and thereafter for the duration of the Consultancy Period (unless the Consulting Agreement is terminated earlier), Employee will not, except with the prior consent of the Company’s Chief Executive Officer, directly or indirectly, solicit or hire, or encourage the solicitation or hiring of, any person who is an employee of the Company for any position as an employee, independent contractor, consultant, or otherwise, provided that the foregoing shall not prevent Employee from serving as a reference.

 

(e)                                  Employee acknowledges that the foregoing restrictions are reasonable restrictions on competition and necessary to protect the Company’s legitimate interests.  Employee further acknowledges that the foregoing restrictions will not work an undue hardship upon her and will not unreasonably restrict her ability to obtain employment following the Effective Date.

 

12.                               Statement Relating to Employee’s Separation.  Within four (4) business days of the execution of this Agreement, the Company shall file with the United States Securities and Exchange Commission a Form 8-K relating to Employee’s separation in the form annexed hereto as Exhibit B.  The parties agree that the substance of this statement may be disclosed in any other public statements that the Company may elect to make and in other filings with the SEC and/or FDA that the Company may be required or elect to make.

 

13.                               Parties to Bear their Own Costs.  Except as otherwise provided herein, the Parties each agree to bear their own attorneys’ fees and costs incurred in connection with this Agreement and all matters relating to the claims being released in this Agreement, including, but not limited to, attorneys’ fees, except that the Company shall be responsible for the fees of any mediator retained to assist the Parties in entering into this Agreement.

 

14.                               Return of Property.  Upon execution of this Agreement, Employee shall deliver to the Company or the Company’s counsel:  (1) all materials belonging to any Released Party, including any Confidential Information (as that term is defined in the Non-Disclosure and Invention Agreement), documents, correspondence, plans, records, notes, drawings, or papers and any copies thereof in Employee’s direct or indirect possession or control, including in particular all notes or records Employee’s has relating to any Released Party, made or compiled by or delivered to Employee; and (2) all other property of any Released Party, including all identification cards, passwords, credit or charge cards, security cards, telephones, pagers,

 

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computer equipment (including, without limitation, her Company-issued laptop, her Company-issued i-Pad, and all diskettes and software), keys, and any of the Released Parties’ business equipment, files or manuals.  Employee shall further provide a written certification, reasonably acceptable to the Company, that neither she, nor any of her family, friends, advisors, or representatives, has not retained any of the materials described in clauses (1) and (2) of this Paragraph 14.

 

15.                               Cooperation.  Employee will fully cooperate with the Released Parties and their counsel in connection with any action or proceeding that relates to the Released Parties, including without limitation, any regulatory action or investigation, litigation or dispute arising out of or relating to alleged actions or inactions of any Released Parties or any of their businesses if any Released Party, in its sole discretion, determines that the cooperation of Employee is needed.  Full cooperation shall include, without limitation, review of documents, attendance at meetings, trial or administrative proceedings, depositions, testimony and interviews without the need of the subpoena process.  Nothing in this Agreement shall be construed to require Employee to act in an unlawful manner.  To the extent that any Released Party requests Employee’s cooperation, the Released Party shall reimburse Employee for reasonable expenses consistent with that Released Party’s expense reimbursement policy in effect at the time.

 

16.                               No Future Employment.  Employee agrees that, except as set forth herein, she will forever refrain from making an application for employment or in any way seek employment with the Released Parties.

 

17.                               Entire Agreement.  This document contains the complete Agreement between the Parties and fully supersedes all prior agreements between and among the Parties, except for:  (i) the Consulting Agreement; (ii) the Non-Disclosure and Invention Agreement, which is expressly reaffirmed; and (iii) the terms and conditions of Section 4.3 of the Employment Agreement, which are expressly reaffirmed.  The terms of this Agreement are contractual and not a mere recital.  Further, the Parties expressly acknowledge that no additional promise or representation concerning the disputes being compromised in this Agreement or any other consideration or payments have been made.

 

18.                               Survival.  This Agreement shall be binding upon and inure to the benefit of the executors, administrators, personal representatives, heirs, successors and assigns of each of the Parties.  The Parties specifically agree that this Agreement shall survive a change in beneficial ownership or composition of the Board of the Company (whether direct or indirect, by purchase, merger, consolidation, or otherwise).

 

19.                               Counterparts.  This Agreement may be executed in identical counterparts, each of which shall constitute an original and all of which shall constitute one and the same Agreement, but shall not be effective until executed by the Parties in its entirety.

 

20.                               Modification. This Agreement may be modified only by a written document signed by the Parties.  No waiver of this Agreement or of any of the promises, obligations, terms, or conditions hereof shall be valid unless it is written and signed by the Party against whom the waiver is to be enforced.  This Agreement supersedes all prior written or oral and all contemporaneous oral agreements, understandings and negotiations.

 

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21.                               Authorization.  Each of the signatories to this Agreement represents and warrants that he or she is authorized to execute this Agreement and to bind the Parties hereto.  Each of the signatories of this Agreement represents that he or she has carefully read and understands its contents, has been advised by counsel as to its meaning and legal implications, and executes this document as his or her own free act.  The Parties further represent and warrant that each has been represented by counsel of its or her choosing in connection with this Agreement and each has had the full opportunity to be advised by such counsel with respect to the terms and effect of entering into this Agreement.

 

22.                               Enforceability.  If any part or any provision of this Agreement shall be finally determined to be invalid or unenforceable under applicable law by an arbitrator or court of competent jurisdiction, that part shall be ineffective to the extent of such invalidity or unenforceability only, without in any way affecting the remaining parts of said provision or the remaining provisions of said Agreement.

 

23.                               Governing Law.  This Agreement shall be governed, in all respects, under the laws of the State of Wisconsin, irrespective of its choice of law rules.

 

24.                               Arbitration.

 

(a)                                 Any controversy between any Released Party, on the one hand, and Employee, on the other hand, arising under this Agreement or the Consulting Agreement (including, but not limited to, a claimed violation of this Agreement) and/or involving the construction or application of any term, provision or condition of this Agreement or the Consulting Agreement shall be submitted to final and binding arbitration.  Arbitration shall comply with and be governed by the then existing JAMS Employment Arbitration Rules and Procedures of JAMS.

 

(b)                                 The cost of arbitration (defined to include only (i) the cost of the arbitrator(s), (ii) the parties’ reasonable attorneys’ fees and (iii) the parties’ reasonable direct, out-of-pocket expenses incurred in connection with the arbitration proceedings) shall be borne by the losing party.

 

(c)                                  Such arbitration proceeding(s) shall take place in Madison, Wisconsin.  Any action to confirm an arbitration award shall be commenced in the federal or state courts located within Wisconsin.

 

SIGNATURE PAGES FOLLOW.

 

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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed and take effect as a sealed instrument as of the day and year above written.

 

 

	
 
    	
 
    
	
Date:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
LAURA   STOLTENBERG
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
WITNESSED   BY:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
EXACT   SCIENCES CORPORATION
    
	
 
    	
 
    
	
 
    	
 
    
	
Date:
    	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    
								

 

11Exhibit 4.1

 

NEITHER THIS SECURITY NOR THE SECURITIES
FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION
OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH
EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE
OF THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.                              

 

COMMON STOCK PURCHASE WARRANT

 

NEUROMETRIX,
INC.

 

	Warrant Shares: ______	Initial Exercise Date: June ___, 2013

 

THIS COMMON STOCK PURCHASE
WARRANT (the “Warrant”) certifies that, for value received, _________ or its assigns (the “Holder”)
is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on
or after the date hereof (the “Initial Exercise Date”) and on or prior to the close of business on the 5 year
anniversary of the Initial Exercise Date (the “Termination Date”) but not thereafter, to subscribe for and purchase
from NeuroMetrix, Inc., a Delaware corporation (the “Company”), up to ______ shares (as subject to adjustment
hereunder, the “Warrant Shares”) of Common Stock. The purchase price of one share of Common Stock under this
Warrant shall be equal to the Exercise Price, as defined in Section 2(b).

 

Section 1.          Definitions.
Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Securities Purchase Agreement
(the “Purchase Agreement”), dated June 4, 2013, among the Company and the purchasers signatory thereto.

 

Section 2.          Exercise.

 

a)          Exercise
of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial
Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or agency of the Company as
it may designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company)
of a duly executed facsimile copy of the Notice of Exercise form annexed hereto and within three (3) Trading Days of the date said
Notice of Exercise is received by the Company, the Company shall have received payment of the aggregate Exercise Price of the shares
thereby purchased by wire transfer or cashier’s check drawn on a United States bank or, if available, pursuant to the cashless
exercise procedure specified in Section 2(c) below. No ink-original Notice of Exercise shall be required, nor shall any medallion
guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required. Notwithstanding anything herein
to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased
all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender
this Warrant to the Company for cancellation within three (3) Trading Days of the date the final Notice of Exercise is received
by the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available
hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to
the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant
Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise Form within
one (1) Business Day of receipt of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and
agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder,
the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face
hereof.

 

    	 

    	 

    

 

 

b)          Exercise
Price. The exercise price per share of the Common Stock under this Warrant shall be $2.00, subject to adjustment hereunder
(the “Exercise Price”).

 

c)          Cashless
Exercise. If at any time after the 6 month anniversary of the date of the Purchase Agreement, there is no effective Registration
Statement registering, or no current prospectus available for, the resale of the Warrant Shares by the Holder, then this Warrant
may only be exercised, in whole or in part, at such time by means of a “cashless exercise” in which the Holder shall
be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

 

		(A) =	the VWAP on the Trading Day immediately preceding the date on which Holder elects to exercise this
Warrant by means of a “cashless exercise,” as set forth in the applicable Notice of Exercise;

 

		(B) =	the Exercise Price of this Warrant, as adjusted hereunder; and

 

		(X) =	the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance
with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.

 

d)          Mechanics
of Exercise.

 

i.          Delivery
of Warrant Shares Upon Exercise. Warrant Shares purchased hereunder shall be transmitted by the Transfer Agent to the Holder
by crediting the account of the Holder’s prime broker with The Depository Trust Company through its Deposit or Withdrawal
at Custodian system (“DWAC”) if the Company is then a participant in such system and either (A) there is an
effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder
or (B) the shares are eligible for resale by the Holder without volume or manner-of-sale limitations pursuant to Rule 144, and
otherwise by physical delivery to the address specified by the Holder in the Notice of Exercise by the end of the day on the date
that is three (3) Trading Days after the latest of (A) the receipt by the Company of the Notice of Exercise and (B) surrender of
this Warrant (if required) (such date, the “Warrant Share Delivery Date”). The Warrant Shares shall be deemed
to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have become a holder of
record of such shares for all purposes, as of the date the Warrant has been exercised, with payment to the Company of the Exercise
Price (or by cashless exercise, if permitted) and all taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(vi)
prior to the issuance of such shares, having been paid. If the Company fails for any reason to deliver to the Holder the Warrant
Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated
damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common Stock
on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the fifth Trading
Day after such liquidated damages begin to accrue) for each Trading Day after such Warrant Share Delivery Date until such Warrant
Shares are delivered or Holder rescinds such exercise.

 

    	2

    	 

    

 

ii.          Delivery
of New Warrants Upon Exercise. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder
and upon surrender of this Warrant, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing
the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all
other respects be identical with this Warrant.

 

iii.          Rescission
Rights. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i)
by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.

 

iv.          Compensation
for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise. In addition to any other rights available to the Holder,
if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to an exercise on or before
the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction
or otherwise) or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a
sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”),
then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including
brokerage commissions, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the
number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times
(2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder,
either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in
which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would have
been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases
Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common
Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding
sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating
the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss.
Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including,
without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely
deliver shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.

 

    	3

    	 

    

 

v.          No
Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise
of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the
Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction
multiplied by the Exercise Price or round up to the next whole share.

 

vi.          Charges,
Taxes and Expenses. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or
other incidental expense in respect of the issuance of Warrant Shares, all of which taxes and expenses shall be paid by the Company,
and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided,
however, that in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant
when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company
may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The
Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise.

 

vii.          Closing
of Books. The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this
Warrant, pursuant to the terms hereof.

 

    	4

    	 

    

 

 

e)          Holder’s
Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise
any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after
exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other
Persons acting as a group together with the Holder or any of the Holder’s Affiliates), would beneficially own in excess of
the Beneficial Ownership Limitation (as defined below).  For purposes of the foregoing sentence, the number of shares of Common
Stock beneficially owned by the Holder and its Affiliates shall include the number of shares of Common Stock issuable upon exercise
of this Warrant with respect to which such determination is being made, but shall exclude the number of shares of Common Stock
which would be issuable upon (i) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder
or any of its Affiliates and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of
the Company (including, without limitation, any other Common Stock Equivalents) subject to a limitation on conversion or exercise
analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates.  Except as set forth
in the preceding sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance with Section
13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company
is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder
is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained
in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by
the Holder together with any Affiliates) and of which portion of this Warrant is exercisable shall be in the sole discretion of
the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant
is exercisable (in relation to other securities owned by the Holder together with any Affiliates) and of which portion of this
Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to
verify or confirm the accuracy of such determination and shall have no liability for exercise of the Warrant that are not in compliance
with the Beneficial Ownership Limitation. In addition, a determination as to any group status as contemplated above shall be determined
in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this
Section 2(e), in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares
of Common Stock as reflected in (A) the Company’s most recent periodic or annual report filed with the Commission, as the
case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the Company or the Transfer
Agent setting forth the number of shares of Common Stock outstanding.  Upon the written or oral request of a Holder, the Company
shall within two Trading Days confirm in writing to the Holder the number of shares of Common Stock then outstanding.  In
any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise
of securities of the Company, including this Warrant, by the Holder or its Affiliates since the date as of which such number of
outstanding shares of Common Stock was reported. The “Beneficial Ownership Limitation” shall be 9.99% of the
number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable
upon exercise of this Warrant. The Holder, upon not less than 61 days’ prior notice to the Company, may increase or decrease
the Beneficial Ownership Limitation provisions of this Section 2(e), provided that the Beneficial Ownership Limitation in no event
exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares
of Common Stock upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e) shall continue to apply.
Any such increase or decrease will not be effective until the 61st day after such notice is delivered to the Company.
The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms
of this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended
Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect
to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.

 

    	5

    	 

    

 

f)          Call
Provision. Subject to the provisions of Section 2(e) and this Section 2(g), if, after the Effective Date, (i) the VWAP for
each of 10 consecutive Trading Days (the “Measurement Period,” which 20 consecutive Trading Day period shall
not have commenced until after the Effective Date) exceeds $3.00 (subject to adjustment for forward and reverse stock splits, recapitalizations,
stock dividends and the like after the Initial Exercise Date), (ii) the average daily volume for such Measurement Period exceeds
100,000 shares per Trading Day (subject to adjustment for forward and reverse stock splits, recapitalizations, stock dividends
and the like after the Initial Exercise Date) and (iii) the Holder is not in possession of any information that constitutes, or
might constitute, material non-public information which was provided by the Company, then the Company may, within 1 Trading Day
of the end of such Measurement Period, call for cancellation of all or any portion of this Warrant for which a Notice of Exercise
has not yet been delivered (such right, a “Call”) for consideration equal to $.001 per Warrant Share. To exercise
this right, the Company must deliver to the Holder an irrevocable written notice (a “Call Notice”), indicating
therein the portion of unexercised portion of this Warrant to which such notice applies. If the conditions set forth below for
such Call are satisfied from the period from the date of the Call Notice through and including the Call Date (as defined below),
then any portion of this Warrant subject to such Call Notice for which a Notice of Exercise shall not have been received by the
Call Date will be cancelled at 6:30 p.m. (New York City time) on the tenth Trading Day after the date the Call Notice is received
by the Holder (such date and time, the “Call Date”). Any unexercised portion of this Warrant to which the Call
Notice does not pertain will be unaffected by such Call Notice. In furtherance thereof, the Company covenants and agrees that it
will honor all Notices of Exercise with respect to Warrant Shares subject to a Call Notice that are tendered through 6:30 p.m.
(New York City time) on the Call Date. The parties agree that any Notice of Exercise delivered following a Call Notice which calls
less than all the Warrants shall first reduce to zero the number of Warrant Shares subject to such Call Notice prior to reducing
the remaining Warrant Shares available for purchase under this Warrant. For example, if (A) this Warrant then permits the Holder
to acquire 100 Warrant Shares, (B) a Call Notice pertains to 75 Warrant Shares, and (C) prior to 6:30 p.m. (New York City time)
on the Call Date the Holder tenders a Notice of Exercise in respect of 50 Warrant Shares, then (x) on the Call Date the right under
this Warrant to acquire 25 Warrant Shares will be automatically cancelled, (y) the Company, in the time and manner required under
this Warrant, will have issued and delivered to the Holder 50 Warrant Shares in respect of the exercises following receipt of the
Call Notice, and (z) the Holder may, until the Termination Date, exercise this Warrant for 25 Warrant Shares (subject to adjustment
as herein provided and subject to subsequent Call Notices). Subject again to the provisions of this Section 2(g), the Company may
deliver subsequent Call Notices for any portion of this Warrant for which the Holder shall not have delivered a Notice of Exercise.
Notwithstanding anything to the contrary set forth in this Warrant, the Company may not deliver a Call Notice or require the cancellation
of this Warrant (and any such Call Notice shall be void), unless, from the beginning of the Measurement Period through the Call
Date, (1) the Company shall have honored in accordance with the terms of this Warrant all Notices of Exercise delivered by 6:30
p.m. (New York City time) on the Call Date, and (2) the Registration Statement shall be effective as to all Warrant Shares and
the prospectus thereunder available for use by the Holder for the resale of all such Warrant Shares, and (3) the Common Stock shall
be listed or quoted for trading on the Trading Market, and (4) there is a sufficient number of authorized shares of Common Stock
for issuance of all Securities under the Transaction Documents, and (5) the issuance of the shares shall not cause a breach of
any provision of Section 2(e) herein. The Company’s right to call the Warrants under this Section 2(g) shall be exercised
ratably among the Holders based on each Holder’s initial purchase of Warrants.

    	6

    	 

    

 

 

Section 3.          Certain
Adjustments.

 

a)          Stock
Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable
in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon
exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including
by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares or (iv) issues by reclassification
of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied
by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding
immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately
after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the
aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become
effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution
and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

 

b)          [RESERVED]

 

 

    	7

    	 

    

 

c)          Subsequent
Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time
the Company grants, issues or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property
pro rata to the record holders of any class of shares of Common Stock (the “Purchase Rights”), then the Holder
will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder
could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant
(without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately
before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken,
the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase
Rights (provided, however, to the extent that the Holder’s right to participate in any such Purchase Right would result in
the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase
Right to such extent (or beneficial ownership of such shares of Common Stock as a result of such Purchase Right to such extent)
and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto
would not result in the Holder exceeding the Beneficial Ownership Limitation).

 

d)          Pro
Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or
other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital
or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of
a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a "Distribution"),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock
acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation,
the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such
record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation
in such Distribution (provided, however, to the extent that the Holder's right to participate in any such Distribution
would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate
in such Distribution to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such Distribution
to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time,
if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation). To
the extent that this Warrant has not been partially or completed exercised at the time of such Distribution, such portion of the
Distribution shall be held in abeyance for the benefit of the Holder until the Holder has exercised this Warrant.

 

    	8

    	 

    

 

e)          Fundamental
Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related
transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly,
effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets
in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether
by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange
their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common
Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization
or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted
into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions
consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby such other Person or group
acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person
or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share
purchase agreement or other business combination) (each a “Fundamental Transaction”), then, upon any subsequent
exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon
such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard
to any limitation in Section 2(e) on the exercise of this Warrant), the number of shares of Common Stock of the successor or acquiring
corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “Alternate Consideration”)
receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Warrant
is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section 2(e) on the exercise
of this Warrant). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to
apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common
Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in
a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common
Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder
shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental
Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor
(the “Successor Entity”) to assume in writing all of the obligations of the Company under this Warrant and the
other Transaction Documents in accordance with the provisions of this Section 3(e) pursuant to written agreements in form and substance
reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction
and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced
by a written instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding number
of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable
and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such
Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock
(but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value
of such shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose of protecting
the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably
satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity
shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this
Warrant and the other Transaction Documents referring to the “Company” shall refer instead to the Successor Entity),
and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Warrant
and the other Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein.

 

    	9

    	 

    

 

f)          Calculations.
All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be.
For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall
be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

 

g)          Notice
to Holder.

 

i.          Adjustment
to Exercise Price. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly
mail to the Holder a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of
Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

 

ii.          Notice
to Allow Exercise by Holder. If the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common
Stock, (C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase
any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required
in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale
or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock
is converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution,
liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be mailed to the Holder
at its last address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable
record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose
of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders
of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined
or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective
or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their
shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger,
sale, transfer or share exchange; provided that the failure to mail such notice or any defect therein or in the mailing thereof
shall not affect the validity of the corporate action required to be specified in such notice. To the extent that any notice provided
hereunder constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company
shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled
to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering
such notice except as may otherwise be expressly set forth herein.

 

    	10

    	 

    

 

Section 4.          Transfer
of Warrant.

 

a)          Transferability.
Subject to compliance with any applicable securities laws and the conditions set forth in Section 4(d) hereof and to the provisions
of Section 4.1 of the Purchase Agreement, this Warrant and all rights hereunder (including, without limitation, any registration
rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated
agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder
or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender
and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or
assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue
to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled.
Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender
this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this
Warrant to the Company within three (3) Trading Days of the date the Holder delivers an assignment form to the Company assigning
this Warrant full. The Warrant, if properly assigned
in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.

 

b)          New
Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the
Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by
the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such
division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants
to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the Initial
Exercise Date and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.

 

    	11

    	 

    

 

c)          Warrant
Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant
Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered
Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and
for all other purposes, absent actual notice to the contrary.

 

d)          Transfer
Restrictions. If, at the time of the surrender of this Warrant in connection with any transfer of this Warrant, the transfer
of this Warrant shall not be either (i) registered pursuant to an effective registration statement under the Securities Act and
under applicable state securities or blue sky laws or (ii) eligible for resale without volume or manner-of-sale restrictions or
current public information requirements pursuant to Rule 144, the Company may require, as a condition of allowing such transfer,
that the Holder or transferee of this Warrant, as the case may be, comply with the transfer restrictions of the Purchase Agreement.

 

e)          Representation
by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant and, upon any
exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to or for
distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities
law, except pursuant to sales registered or exempted under the Securities Act.

 

Section 5.          Miscellaneous.

 

a)          No
Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other rights
as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in
Section 3.

 

b)          Loss,
Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant
Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of
the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate,
if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation,
in lieu of such Warrant or stock certificate.

    	12

    	 

    

 

 

c)          Saturdays,
Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required or
granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding
Business Day.

 

d)          Authorized
Shares.

 

The Company covenants
that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient
number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.
The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged
with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company
will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without
violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be
listed. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented
by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance
herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges created by
the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such
issue).

 

Except and
to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or
sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this
Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions
as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting
the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable
therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate
in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant
and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory
body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.

 

    	13

    	 

    

 

Before taking
any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary
from any public regulatory body or bodies having jurisdiction thereof.

 

e)          Jurisdiction.
All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance
with the provisions of the Purchase Agreement.

 

f)          Restrictions.
The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and the Holder does
not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.

 

g)          Nonwaiver
and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate
as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies, notwithstanding the fact that all
rights hereunder terminate on the Termination Date. If the Company willfully and knowingly fails to comply with any provision of
this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be
sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of
appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its
rights, powers or remedies hereunder.

 

h)          Notices.
Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered
in accordance with the notice provisions of the Purchase Agreement.

 

i)          Limitation
of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase
Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder
for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company
or by creditors of the Company.

 

j)          Remedies.
The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled
to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation
for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert
the defense in any action for specific performance that a remedy at law would be adequate.

 

    	14

    	 

    

 

k)          Successors
and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure
to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and
shall be enforceable by the Holder or holder of Warrant Shares.

 

l)          Amendment.
This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and
the Holder.

 

m)          Severability.
Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective
to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions
of this Warrant.

 

n)          Headings.
The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of
this Warrant.

 

********************

 

(Signature Page Follows)

 

 

 

    	15

    	 

    

 

 

IN WITNESS WHEREOF, the
Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.

 

      

	 	
        neurometrix, inc.

         

         

	 	By:	 
	 	
         

         

         
	
        Name:

        Title:

        

 

          

    	16

    	 

    

 

NOTICE OF EXERCISE

 

To:          neurometrix,
inc.

 

(1)          The undersigned
hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised
in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.

 

(2)          Payment shall
take the form of (check applicable box):

 

[ ] in lawful
money of the United States; or

 

[ ] if permitted,
the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c),
to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure
set forth in subsection 2(c).

 

(3)          Please issue said
Warrant Shares in the name of the undersigned or in such other name as is specified below:

 

_______________________________

 

 

The Warrant Shares shall be delivered to
the following DWAC Account Number:

 

_______________________________

 

_______________________________

 

_______________________________

 

(4)          Accredited Investor.
The undersigned is an “accredited investor” as defined in Regulation D promulgated under the Securities Act of 1933,
as amended.

 

[SIGNATURE
OF HOLDER]

 

Name of Investing Entity: ________________________________________________________________________

Signature of Authorized Signatory of
Investing Entity: _________________________________________________

Name of Authorized Signatory: ___________________________________________________________________

Title of Authorized Signatory: ____________________________________________________________________

Date: ________________________________________________________________________________________

 

 

 

    	 

    	 

    

 

 

          EXHIBIT B

 

ASSIGNMENT
FORM

 

(To assign the
foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)

 

FOR VALUE RECEIVED,
the foregoing Warrant and all rights evidenced thereby are hereby assigned to

 

	Name:	                                                                          
	 	(Please Print)
	Address:	                                                                         
	 	(Please Print)
	Dated: _______________ __, ______	 
	Holder’s Signature:                                                                          	 
	Holder’s Address:

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