Exhibit 1.1
_______________ SHARES
HEALTHEON CORPORATION
COMMON STOCK ($.0001 PAR VALUE PER SHARE)
UNDERWRITING AGREEMENT
__________, 1998
_____________, 1998
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, Sachs & Co.
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLC
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & Company, LLC
c/o Morgan ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International Limited
▇▇▇▇▇▇▇ Sachs International
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLC
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & Company, LLC
c/o Morgan ▇▇▇▇▇▇▇ & Co. International Limited
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇ ▇▇▇
England
Dear Sirs and Mesdames:
Healtheon Corporation, a Delaware corporation (the "COMPANY"),
proposes to issue and sell to the several Underwriters (as defined below)
_________ shares of its Common Stock, $.0001 par value per share (the "FIRM
SHARES").
It is understood that, subject to the conditions hereinafter
stated, ____________ Firm Shares (the "U.S. FIRM SHARES") will be sold to the
several U.S. Underwriters named in Schedule I hereto (the "U.S.
UNDERWRITERS") in connection with the offering and sale of such U.S. Firm
Shares in the United States and Canada to United States and Canadian Persons
(as such terms are defined in the Agreement Between U.S. and International
Underwriters of even date herewith), and __________ Firm Shares (the
"INTERNATIONAL SHARES") will be sold to the several International
Underwriters named in Schedule II hereto (the "INTERNATIONAL UNDERWRITERS")
in connection with the offering and sale of such International Shares outside
the United States and Canada to persons other than United States and Canadian
Persons. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated and ▇▇▇▇▇▇▇, Sachs & Co.,
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLC and ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & Company, LLC shall act as
representatives (the "U.S. REPRESENTATIVES") of the several U.S.
Underwriters, and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International Limited and ▇▇▇▇▇▇▇
Sachs International, ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLC and ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & Company,
LLC shall act as representatives (the "INTERNATIONAL REPRESENTATIVES") of the
several International Underwriters. The U.S. Underwriters and the
International Underwriters are hereinafter collectively referred to as the
Underwriters.
The Company also proposes to issue and sell to the several U.S.
Underwriters not more than an additional __________ shares of its Common
Stock, $.0001 par value per share (the "ADDITIONAL SHARES") if and to the
extent that the U.S. Representatives shall have determined to exercise, on
behalf of the U.S. Underwriters, the right to purchase such shares of common
stock granted to the U.S. Underwriters in Section 2 hereof. The Firm Shares
and the Additional Shares are hereinafter collectively referred to as the
"SHARES". The shares of Common Stock, $.0001 par value per share of the
Company to be outstanding after giving effect to the sales contemplated
hereby are hereinafter referred to as the "COMMON STOCK".
The Company has filed with the Securities and Exchange
Commission (the "COMMISSION") a registration statement relating to the
Shares. The registration statement contains two prospectuses to be used in
connection with the offering and sale of the Shares: the U.S. prospectus, to
be used in connection with the offering and sale of Shares in the United
States and Canada to United States and Canadian Persons, and the
international prospectus, to be used in connection with the offering and sale
of Shares outside the United States and Canada to persons other than United
States and Canadian Persons. The international prospectus is identical to
the U.S. prospectus except for the outside front cover page. The
registration statement as amended at the time it becomes effective, including
the information (if any) deemed to be part of the registration statement at
the time of effectiveness pursuant to Rule 430A under the Securities Act of
1933, as amended (the "SECURITIES ACT"), is hereinafter referred to as the
"REGISTRATION STATEMENT"; the U.S. prospectus and the international
prospectus in the respective forms first used to confirm sales of Shares are
hereinafter collectively referred to as the "PROSPECTUS." If the Company has
filed an abbreviated registration statement to register additional shares of
Common Stock pursuant to Rule 462(b) under the Securities Act (the "RULE 462
REGISTRATION STATEMENT"), then any reference herein to the term "Registration
Statement" shall be deemed to include such Rule 462 Registration Statement.
As part of the offering contemplated by this Agreement, ▇▇▇▇▇▇
▇▇▇▇▇▇▇ & Co. Incorporated ("▇▇▇▇▇▇ ▇▇▇▇▇▇▇") has agreed to reserve out of
the Shares set forth opposite its name on Schedule I to this Agreement, up to
__________ shares, for sale to certain parties designated by the Company
(collectively, "PARTICIPANTS") (the "DIRECTED SHARE PROGRAM"). The Shares to
be sold by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ pursuant to the Directed Share Program (the
"DIRECTED SHARES") will be sold by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ pursuant to this Agreement
at the public offering price. Any Directed Shares not orally confirmed for
purchase by any Participants by the end of the first business day after the
date on which this Agreement is executed will be offered to the public by
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ as set forth in the Prospectus.
1. REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement has become effective; no stop
order suspending the effectiveness of the Registration Statement is in
effect, and no proceedings for such purpose are pending before or
threatened by the Commission.
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(b) (i) The Registration Statement, when it became effective,
did not contain and, as amended or supplemented, if applicable, will not
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) the Registration Statement and
the Prospectus comply and, as amended or supplemented, if applicable,
will comply in all material respects with the Securities Act and the
applicable rules and regulations of the Commission thereunder and (iii)
the Prospectus does not contain and, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth in
this paragraph do not apply to statements or omissions in the
Registration Statement or the Prospectus based upon information relating
to any Underwriter furnished to the Company in writing by such
Underwriter through you expressly for use therein.
(c) The Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the jurisdiction of
its incorporation, has the corporate power and authority to own its
property and to conduct its business as described in the Prospectus and
is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing would not have
a material adverse effect on the Company and its Subsidiaries (as defined
below), taken as a whole.
(d) Other than Actamed Corporation, a Georgia corporation
("ACTAMED"), UHC Green Acquisition Corp., a Nevada corporation ("UHC")
and [Metis Acquisition Subsidiary] ("METIS") (each of Actamed, UHC and
Metis are referred to herein as a "SUBSIDIARY" and collectively as the
"SUBSIDIARIES"), the Company has no subsidiaries. Each Subsidiary of
the Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its
property and to conduct its business as described in the Prospectus
and is duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except
to the extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the Company and
its Subsidiaries, taken as a whole. All of the issued shares of
capital stock of each Subsidiary of the Company have been duly and
validly authorized and issued, are fully paid and non-assessable and
are owned directly by the Company, free and clear of all liens,
encumbrances, equities or claims. The Company does not own, directly
or indirectly, an interest in any other corporation, partnership,
business, trust or other entity.
(e) The Company and each of its Subsidiaries have good and
marketable title in fee simple to all real property and good and
marketable title to all personal property
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owned by them which is material to the business of the Company and the
Subsidiaries, taken as a whole, in each case free and clear of all
liens, encumbrances and defects except such as are described in the
Prospectus or such as do not materially affect the value of such
property and do not materially interfere with the use made and
proposed to be made of such property by the Company and its
Subsidiaries, taken as a whole; and any real property and buildings
held under lease by the Company and each of its Subsidiaries are held
by them under valid, subsisting and enforceable leases with such
exceptions as are not material to the Company and its Subsidiaries,
taken as a whole, and do not interfere with the use made and proposed
to be made of such property and buildings of the Company and each of
its Subsidiaries, in each case except as described in the Prospectus,
or which intervention is not material to the Company and its
Subsidiaries, taken as a whole.
(f) This Agreement has been duly authorized, executed and
delivered by the Company.
(g) The authorized capital stock of the Company conforms as to
legal matters to the description thereof contained in the Prospectus.
(h) The shares of Common Stock outstanding prior to the
issuance of the Shares have been duly authorized and are validly issued,
fully paid and non-assessable. Except as set forth in the Prospectus,
neither the Company nor any of its Subsidiaries has outstanding any
options to purchase, or any preemptive rights or other rights to
subscribe for or to purchase, any securities or obligations convertible
into, or any contracts or commitments to issue or sell, shares of its
capital stock or any such options, rights, convertible securities or
obligations. All outstanding shares of capital stock and options and
other rights to acquire capital stock have been issued in compliance with
the registration and qualification provisions of all applicable federal
and state securities laws and were not issued in violation of any
preemptive rights, rights of first refusal or other similar rights.
(i) The Shares have been duly authorized and, when issued and
delivered in accordance with the terms of this Agreement, will be validly
issued, fully paid and non-assessable, and the issuance of such Shares
will not be subject to any preemptive or similar rights.
(j) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement will
not contravene any provision of applicable law or the certificate of
incorporation or by-laws of the Company or any of its Subsidiaries or any
agreement or other instrument binding upon the Company or any of its
Subsidiaries that is material to the Company and its Subsidiaries, taken
as a whole, or any judgment, order or decree of any governmental body,
agency or court having jurisdiction over the Company or any Subsidiary,
and no consent, approval, authorization
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or order of, or qualification with, any governmental body or agency is
required for the performance by the Company of its obligations under
this Agreement, except such as may be required by the securities or
Blue Sky laws of the various states in connection with the offer and
sale of the Shares.
(k) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company and its Subsidiaries, taken as a whole, from
that set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement).
(l) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, (i) the
Company and its Subsidiaries have not incurred any material liability or
obligation, direct or contingent, nor entered into any material
transaction not in the ordinary course of business; (ii) the Company has
not purchased any of its outstanding capital stock, nor declared, paid or
otherwise made any dividend or distribution of any kind on its capital
stock; and (iii) there has not been any material change in the capital
stock, short-term debt or long-term debt of the Company and its
Subsidiaries, except in each case as described in the Prospectus.
(m) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its Subsidiaries is a party or
to which any of the properties of the Company or any of its Subsidiaries
is subject that are required to be described in the Registration
Statement or the Prospectus and are not so described or any statutes,
regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be filed
as exhibits to the Registration Statement that are not described or filed
as required.
(n) Each of the Company and each of its Subsidiaries has all
necessary consents, authorizations, approvals, orders, certificates and
permits of and from, and has made all declarations and filings with, all
federal, state, local, foreign and other governmental or regulatory
authorities, all self-regulatory organizations and all courts and other
tribunals, to own, lease, license and use its properties and assets and
to conduct its business in the manner described in the Prospectus, except
to the extent that the failure to obtain or file would not have a
material adverse effect on the Company and its Subsidiaries taken as a
whole. Neither the Company nor any of its Subsidiaries has received any
notice of proceedings related to the revocation or modification of any
such consent, authorization, approval, order, certificate or permit
which, singly or in the aggregate, if the subject of any unfavorable
decision, ruling or finding, would result in a material adverse change in
the condition, financial or otherwise, or in the earnings, business or
operations of the Company and its Subsidiaries, taken as a whole, except
as described in the Prospectus.
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(o) Each preliminary 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 Securities Act,
complied when so filed in all material respects with the Securities
Act and the applicable rules and regulations of the Commission
thereunder.
(p) The Company is not and, after giving effect to the offering
and sale of the Shares and the application of the proceeds thereof as
described in the Prospectus, will not be an "investment company" as such
term is defined in the Investment Company Act of 1940, as amended.
(q) The Company and each of its Subsidiaries (i) are in
compliance with any and all applicable foreign, federal, state and local
laws and regulations relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes,
pollutants or contaminants ("ENVIRONMENTAL LAWS"), (ii) have received all
permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii) are
in compliance with all terms and conditions of any such permit, license
or approval, except where such noncompliance with Environmental Laws,
failure to receive required permits, licenses or other approvals or
failure to comply with the terms and conditions of such permits, licenses
or approvals would not, singly or in the aggregate, have a material
adverse effect on the Company and its Subsidiaries, taken as a whole.
(r) There are no costs or liabilities associated with
Environmental Laws (including, without limitation, any capital or
operating expenditures required for clean-up, closure of properties or
compliance with Environmental Laws or any permit, license or approval,
any related constraints on operating activities and any potential
liabilities to third parties) which would, singly or in the aggregate,
have a material adverse effect on the Company and its Subsidiaries, taken
as a whole.
(s) Except as described in the Prospectus, there are no
contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a
registration statement under the Securities Act with respect to any
securities of the Company or to require the Company to include such
securities with the Shares registered pursuant to the Registration
Statement.
(t) The Company and each of its Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and
risks and in such amounts as are prudent and customary in the businesses
in which they are engaged; neither the Company nor any of its
Subsidiaries has been refused any insurance coverage sought or applied
for; and neither the Company nor its Subsidiaries has any reason to
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 at a cost
that would not materially and adversely affect the
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condition, financial or otherwise, or the earnings, business or
operations of the Company and its Subsidiaries, taken as a whole.
(u) The financial statements, including the notes thereto,
included in the Registration Statement and the Prospectus fairly present,
in all material respects, the financial position of the Company as of the
dates indicated and the results of its operations for the periods
specified; said financial statements have been prepared in conformity
with generally accepted accounting principles applied on a consistent
basis.
(v) Neither the Company nor, to the Company's knowledge, any
other party is in violation or breach of, or in default with respect to,
complying with any material provision of any contract, agreement,
instrument, lease, license, arrangement or understanding which is
material to the Company and its Subsidiaries taken as a whole, and each
such contract, agreement, instrument, lease, license, arrangement and
understanding is in full force and is the legal, valid and binding
obligation of the Company or its Subsidiary and, to the Company's
knowledge, the other parties thereto and is enforceable against the
Company or its Subsidiary and, to the Company's knowledge, against the
other parties thereto in accordance with its terms.
(w) The Company has complied with all provisions of Section
517.075, Florida Statutes relating to doing business with the Government
of Cuba or with any person or affiliate located in Cuba.
(x) Except as disclosed in the Prospectus, (i) the Company and
each of its Subsidiaries owns or possesses all material patents, patent
rights, licenses, inventions, copyrights, know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures), trademarks, service
marks, trade names, technology and know-how currently employed by them to
conduct their respective businesses in the manner described in the
Prospectus, (ii) neither the Company nor any of its Subsidiaries has
received any notice of infringement of or conflict with (and neither the
Company nor any of its Subsidiaries knows of any infringement or conflict
with) asserted rights of others with respect to any of the foregoing
which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would have a material adverse effect upon
the Company and its Subsidiaries, taken as a whole, and (iii) the
discoveries, inventions, products or processes of the Company and each of
its Subsidiaries referred to in the Prospectus do not, to the knowledge
of the Company or any of its Subsidiaries, infringe or conflict with any
right or patent of any third party, or any discovery, invention, product
or process that would have a material adverse effect on the Company and
its Subsidiaries, taken as a whole.
(y) The Company and its Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance
that (i) transactions are executed in accordance with management's
general or specific authorizations;
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(ii) transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting
principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for
assets is compared with the existing assets at reasonable intervals
and appropriate action is taken with respect to any differences.
(z) No material labor dispute with the employees of the Company
or any of its Subsidiaries exists or, to the knowledge of the Company, is
imminent; and the Company is not aware of any existing, threatened or
imminent labor disturbance by the employees of any of its principal
suppliers, manufacturers or contractors that could have a material
adverse effect on the Company and its Subsidiaries, taken as a whole.
(aa) All outstanding shares of Common Stock, and all securities
convertible into or exercisable or exchangeable for Common Stock, are
subject to valid,, binding and enforceable agreements with ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
(collectively, the "LOCK-UP AGREEMENTS") that restrict the holders
thereof from selling, making any short sale or, granting any option for
the purchase of, or otherwise transferring or disposing of, any of such
shares of Common Stock, or any such securities convertible into or
exercisable or exchangeable for Common Stock, for a period of 180 days
after the date of the Prospectus without the prior written consent of
▇▇▇▇▇▇ ▇▇▇▇▇▇▇.
(bb) As of the date the Registration Statement became effective,
the Common Stock was authorized for listing on the Nasdaq National Market
upon official notice of issuance.
(cc) The Company represents and warrants to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ that
(i) the Registration Statement, the Prospectus and any preliminary
prospectus comply, and any further amendments or supplements thereto will
comply, with any applicable laws or regulations of foreign jurisdictions
in which the Prospectus or any preliminary prospectus, as amended or
supplemented, if applicable, are distributed in connection with the
Directed Share Program, and that, (ii) no authorization, approval,
consent, license, order, registration or qualification of or with any
government, governmental instrumentality or court, other than such as
have been obtained, is necessary under the securities laws and
regulations of foreign jurisdictions in which the Directed Shares are
offered outside the United States.
(dd) The Company has not offered, or caused the Underwriters to
offer, Shares to any person pursuant to the Directed Share Program with
the specific intent to unlawfully influence (i) a customer or supplier of
the Company to alter the customer's or supplier's level or type of
business with the Company, or (ii) a trade journalist or publication to
write or publish favorable information about the Company or its
applications or services.
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2. AGREEMENTS TO SELL AND PURCHASE. The Company hereby
agrees to sell to the several Underwriters, and each Underwriter, upon the
basis of the representations and warranties herein contained, but subject to
the conditions hereinafter stated, agrees, severally and not jointly, to
purchase from the Company the respective numbers of Firm Shares set forth in
Schedules I and II hereto opposite its names at U.S.$_____ a share ("PURCHASE
PRICE").
On the basis of the representations and warranties contained in
this Agreement, and subject to its terms and conditions, the Company agrees
to sell to the U.S. Underwriters the Additional Shares, and the U.S.
Underwriters shall have a one-time right to purchase, severally and not
jointly, up to __________ Additional Shares at the Purchase Price. If the
U.S. Representatives, on behalf of the U.S. Underwriters, elect to exercise
such option, the U.S. Representatives shall so notify the Company in writing
not later than 30 days after the date of this Agreement, which notice shall
specify the number of Additional Shares to be purchased by the U.S.
Underwriters and the date on which such shares are to be purchased. Such
date may be the same as the Closing Date (as defined below) but not earlier
than the Closing Date nor later than ten business days after the date of such
notice. Additional Shares may be purchased as provided in Section 4 hereof
solely for the purpose of covering over-allotments made in connection with
the offering of the Firm Shares. If any Additional Shares are to be
purchased, each U.S. Underwriter agrees, severally and not jointly, to
purchase the number of Additional Shares (subject to such adjustments to
eliminate fractional shares as the U.S. Representatives may determine) that
bears the same proportion to the total number of Additional Shares to be
purchased as the number of U.S. Firm Shares set forth in Schedule I hereto
opposite the name of such U.S. Underwriter bears to the total number of U.S.
Firm Shares.
The Company hereby agrees that, without the prior written
consent of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ on behalf of the Underwriters, it will not, during
the period ending 180 days after the date of the Prospectus, (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
to purchase, lend, or otherwise transfer or dispose of, directly or
indirectly, any shares of Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock or (ii) enter into any swap or
other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the Common Stock, whether any such
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 Shares to be sold hereunder or
(B) the issuance by the Company of shares of Common Stock upon the exercise
of an option or warrant or the conversion of a security outstanding on the
date hereof of which the Underwriters have been advised in writing or
described as outstanding or reserved for issuance under the option plans
described in the Prospectus, or any other issuances of Common Stock or
options to acquire Common Stock hereafter under the option or equity
incentive plans described in the Prospectus; provided that with respect to
securities issued pursuant to the exceptions set forth in clause (B), the
holders of such securities shall enter into Lock-Up Agreements on the terms
specified in Section 1(aa).
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3. TERMS OF PUBLIC OFFERING. The Company is advised by you
that the Underwriters propose to make a public offering of their respective
portions of the Shares as soon after the Registration Statement and this
Agreement have become effective as in your judgment is advisable. The Company
is further advised by you that the Shares are to be offered to the public
initially at U.S.$_____ a share (the "PUBLIC OFFERING PRICE") and to certain
dealers selected by you at a price that represents a concession not in excess of
U.S.$____ a share under the Public Offering Price, and that any Underwriter may
allow, and such dealers may reallow, a concession, not in excess of U.S.$____ a
share, to any Underwriter or to certain other dealers.
4. PAYMENT AND DELIVERY. Payment for the Firm Shares shall be
made to the Company in Federal or other funds immediately available in New York
City against delivery of such Firm Shares for the respective accounts of the
several Underwriters at 10:00 a.m., New York City time, on ____________, 1998,
or at such other time on the same or such other date, not later than _________,
1998, as shall be designated in writing by you. The time and date of such
payment are hereinafter referred to as the "CLOSING DATE."
Payment for any Additional Shares shall be made to the Company in
Federal or other funds immediately available in New York City against delivery
of such Additional Shares for the respective accounts of the several
Underwriters at 10:00 a.m., New York City time, on the date specified in the
notice described in Section 2 or at such other time on the same or on such other
date, in any event not later than _______, 1998, as shall be designated in
writing by the U.S. Representatives. The time and date of such payment are
hereinafter referred to as the "OPTION CLOSING DATE."
Certificates for the Firm Shares and Additional Shares shall be in
definitive form and registered in such names and in such denominations as you
shall request in writing not later than one full business day prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to you on
the Closing Date or the Option Closing Date, as the case may be, for the
respective accounts of the several Underwriters, with any transfer taxes payable
in connection with the transfer of the Shares to the Underwriters duly paid,
against payment of the Purchase Price therefor.
5. CONDITIONS TO THE UNDERWRITERS' OBLIGATIONS. The
obligations of the Company to sell the Shares to the Underwriters and the
several obligations of the Underwriters to purchase and pay for the Shares on
the Closing Date are subject to the condition that the Registration Statement
shall have become effective not later than [_______] (New York City time) on the
date hereof.
The several obligations of the Underwriters are subject to the
following further conditions:
(a) Subsequent to the execution and delivery of this Agreement
and prior to the Closing Date:
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(i) there shall not have occurred any downgrading, nor
shall any notice have been given of any intended or potential
downgrading or of any review for a possible change that does not
indicate the direction of the possible change, in the rating
accorded any of the Company's securities by any "nationally
recognized statistical rating organization," as such term is
defined for purposes of Rule 436(g)(2) under the Securities Act;
and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations
of the Company and its Subsidiaries, taken as a whole, from that
set forth in the Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement)
that, in your judgment, is material and adverse and that makes it,
in your judgment, impracticable to market the Shares on the terms
and in the manner contemplated in the Prospectus.
(b) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of
the Company, to the effect set forth in Section 5(a) above and to the
effect that the representations and warranties of the Company contained
in this Agreement are true and correct as of the Closing Date and that
the Company has complied with all of the agreements and satisfied all of
the conditions on its part to be performed or satisfied hereunder on or
before the Closing Date.
The officer signing and delivering such certificate may rely upon
the best of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on the Closing Date an
opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, counsel for the Company,
dated the Closing Date, to the effect that:
(i) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power
and authority to own its property and to conduct its business
as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the
Company and its Subsidiaries, taken as a whole;
(ii) each Subsidiary of the Company has been duly
incorporated, is validly existing as a corporation in good
standing under the laws of the
11
jurisdiction of its incorporation, has the corporate power and
authority to own its property and to conduct its business as
described in the Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which
the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not
have a material adverse effect on the Company and its
Subsidiaries, taken as a whole;
(iii) the authorized capital stock of the Company conforms
as to legal matters to the description thereof contained in the
Prospectus;
(iv) the shares of Common Stock outstanding prior to the
issuance of the Shares have been duly authorized and are validly
issued, fully paid and non-assessable;
(v) all of the issued shares of capital stock of each
subsidiary of the Company have been duly and validly authorized
and issued, are fully paid and non-assessable and are owned
directly by the Company, free and clear of all liens,
encumbrances, equities or claims;
(vi) the Shares have been duly authorized and, when issued
and delivered in accordance with the terms of this Agreement,
will be validly issued, fully paid and non-assessable, and the
issuance of such Shares will not be subject to any preemptive
right or rights of first refusal or similar rights.
(vii) this Agreement has been duly authorized, executed and
delivered by the Company;
(viii) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this
Agreement will not contravene any provision of applicable law
or the certificate of incorporation or by-laws of the Company
or, to such counsel's knowledge, any agreement or other
instrument binding upon the Company or any of its Subsidiaries
that is material to the Company and its Subsidiaries, taken as
a whole, or, to such counsel's knowledge, any judgment, order
or decree of any governmental body, agency or court having
jurisdiction over the Company or any Subsidiary, and no
consent, approval, authorization or order of, or qualification
with, any governmental body or agency is required for the
performance by the Company of its obligations under this
Agreement, except such as may be required by the securities or
Blue Sky laws of the various states in connection with the
offer and sale of the Shares by the U.S. Underwriters;
12
(ix) the statements (A) in the Prospectus under the
captions "Risk Factors--Dependence on Strategic Relationships,"
"Risk Factors--Government Regulation," "Risk Factors--Shares
Eligible For Future Sale," "Business--Strategic Relationships,"
"Business--Government Regulation," "Certain Transactions,"
"Description of Capital Stock," "Shares Eligible for Future
Sale" and "Underwriters" and (B) in the Registration Statement
in Items 14 and 15, in each case insofar as such statements
constitute summaries of the legal matters, documents or
proceedings referred to therein, fairly present the information
called for with respect to such legal matters, documents and
proceedings and fairly summarize the matters referred to
therein;
(x) after due inquiry, such counsel does not know of any
legal or governmental proceedings pending or threatened to
which the Company or any of its Subsidiaries is a party or to
which any of the properties of the Company or any of its
Subsidiaries is subject that are required to be described in
the Registration Statement or the Prospectus and are not so
described or of any statutes, regulations, contracts or other
documents that are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as
required;
(xi) the Company is not and, after giving effect to the
offering and sale of the Shares and the application of the
proceeds thereof as described in the Prospectus, will not be an
"investment company" as such term is defined in the Investment
Company Act of 1940, as amended;
(xii) to such counsel's knowledge: (1) the Registration
Statement has become effective under the Securities Act;
(2) no stop order proceedings with respect to the Registration
Statement have been instituted or are pending or threatened
under the Securities Act and nothing has come to such counsel's
attention to lead it to believe that such proceedings are
contemplated; and (3) any required filing of the Prospectus and
any supplement thereto pursuant to Rule 424(b) under the
Securities Act has been made in the manner and within the time
period required by such Rule 424(b);
(xiii) except as described in the Prospectus, no shares of
Common Stock are required to be registered under the
Registration Statement and no person or entity has any right to
cause any shares of Common Stock to be registered under the
Registration Statement, pursuant to the Company's certificate
of incorporation or bylaws or, to such counsel's knowledge, any
agreement or other right, which rights have not been validly
waived;
13
(xiv) based on a letter from the Nasdaq Stock Market, the
shares to be sold under this Agreement to the Underwriters are
duly authorized for quotation on the Nasdaq National Market; and
(xv) such counsel (A) is of the opinion that the
Registration Statement and Prospectus (except for financial
statements and schedules and other financial data included
therein as to which such counsel need not express any opinion)
comply as to form in all material respects with the Securities
Act and the applicable rules and regulations of the Commission
thereunder, (B) has no reason to believe that (except for
financial statements and schedules and other financial data as
to which such counsel need not express any belief) the
Registration Statement and the prospectus included therein at
the time the Registration Statement became effective contained
any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to
make the statements therein not misleading and (C) has no
reason to believe that (except for financial statements and
schedules and other financial data as to which such counsel
need not express any belief) the Prospectus, as of its date or
the Closing Date, contains any untrue statement of a material
fact or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances
under which they were made, not misleading.
(d) The Underwriters shall have received on the Closing Date an
opinion of Fenwick & West LLP, counsel for the Underwriters, dated the
Closing Date, covering the matters referred to in Sections 5(c)(vi),
5(c)(vii), 5(c)(ix) (but only as to the statements in the Prospectus
under "Description of Capital Stock" and "Underwriters") and 5(c)(xv)
above.
With respect to Section 5(c)(xv) above, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇ and Fenwick & West LLP may state that their opinion and belief are
based upon their participation in the preparation of the Registration
Statement and Prospectus and any amendments or supplements thereto and
review and discussion of the contents thereof, but are without
independent check or verification, except as specified.
The opinion of Wilson, Sonsini, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ described in
Section 5(c) above shall be rendered to the Underwriters at the request
of the Company and shall so state therein.
(e) The Underwriters shall have received, on each of the date
hereof and the Closing Date, a letter dated the date hereof or the
Closing Date, as the case may be, in form and substance satisfactory to
the Underwriters, from Ernst & Young LLP and with respect to the
Financial Statements and certain financial information with respect to
Actamed, Deloitte & Touche LLP, independent public accountants,
containing statements and information of the type ordinarily included in
accountants' "comfort letters" to
14
underwriters with respect to the financial statements and certain
financial information contained in the Registration Statement and the
Prospectus; PROVIDED that the letter delivered on the Closing Date
shall use a "cut-off date" not earlier than the date hereof.
(f) The "lock-up" agreements, each substantially in the form of
Exhibit A hereto, between you and certain stockholders, officers and
directors of the Company relating to sales and certain other dispositions
of shares of Common Stock or certain other securities, delivered to you
on or before the date hereof, shall be in full force and effect on the
Closing Date.
(g) The Shares shall have received approval for listing, upon
official notice of issuance, on the Nasdaq National Market.
All the agreements, opinions, certificates and letters mentioned
above or elsewhere in this Agreement shall be deemed in compliance with the
provisions hereof only if Fenwick & West LLP, counsel for the Underwriters,
shall be reasonably satisfied that they comply in form and scope.
The several obligations of the U.S. Underwriters to purchase
Additional Shares hereunder are subject to the delivery to the U.S.
Representatives on the Option Closing Date of such documents as they may
reasonably request with respect to the good standing of the Company, the due
authorization and issuance of the Additional Shares and other matters related to
the issuance of the Additional Shares.
6. COVENANTS OF THE COMPANY. In further consideration of the
agreements of the Underwriters herein contained, the Company covenants with each
Underwriter as follows:
(a) To furnish to you, without charge, nine (9) signed copies
of the Registration Statement (including exhibits thereto) and for
delivery to each other Underwriter a conformed copy of the Registration
Statement (without exhibits thereto) and to furnish to you in New York
City, without charge, prior to 10:00 a.m. New York City time on the
business day next succeeding the date of this Agreement and during the
period mentioned in Section 6(c) below, as many copies of the Prospectus
and any supplements and amendments thereto or to the Registration
Statement as you may reasonably request.
(b) Before amending or supplementing the Registration Statement
or the Prospectus, to furnish to you a copy of each such proposed
amendment or supplement and not to file any such proposed amendment or
supplement to which you reasonably object, and to file with the
Commission within the applicable period specified in Rule 424(b) under
the Securities Act any prospectus required to be filed pursuant to such
Rule.
(c) If, during such period after the first date of the public
offering of the Shares as in the opinion of counsel for the Underwriters
the Prospectus is required by law
15
to be delivered in connection with sales by an Underwriter or dealer,
any event shall occur or condition exist as a result of which it is
necessary to amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances when the
Prospectus is delivered to a purchaser, not misleading, or if, in the
opinion of counsel for the Underwriters, it is necessary to amend or
supplement the Prospectus to comply with applicable law, forthwith to
prepare, file with the Commission and furnish, at its own expense, to
the Underwriters and to the dealers (whose names and addresses you
will furnish to the Company) to which Shares may have been sold by you
on behalf of the Underwriters and to any other dealers upon request,
[as many copies as you may from, time to time reasonably request of]
either amendments or supplements to the Prospectus so that the
statements in the Prospectus as so amended or supplemented will not,
in the light of the circumstances when the Prospectus is delivered to
a purchaser, be misleading or so that the Prospectus, as amended or
supplemented, will comply with law.
(d) To endeavor to qualify the Shares for offer and sale under
the securities or Blue Sky laws of such jurisdictions as you shall
reasonably request.
(e) To make generally available to the Company's security
holders and to you as soon as practicable an earning statement covering
the twelve-month period ending ________, 199_ that satisfies the
provisions of Section 11(a) of the Securities Act and the rules and
regulations of the Commission thereunder.
(f) During a period of three years from the effective date of
the Registration Statement, the Company will furnish to you copies of
(i) all reports to its stockholders and (ii) all reports, financial
statements and proxy or information statements filed by the Company with
the Commission or any national securities exchange.
(g) The Company will apply the proceeds from the sale of the
Shares as set forth under "Use of Proceeds" in the Prospectus.
(h) The Company will use its best efforts to obtain and
maintain in effect the quotation of the Shares on the Nasdaq National
Market and to maintain such inclusion for a period of three years after
the date hereof or until such earlier date as the Shares shall be listed
for regular trading privileges on another national securities exchange
approved by you.
(i) The Company will comply with all registration, filing and
reporting requirements of the Securities Exchange Act of 1934, as amended
(the "EXCHANGE ACT"), which may from time to time be applicable to the
Company.
(j) The Company will comply with all provisions of all
undertakings contained in the Registration Statement.
16
(k) Prior to the Closing Date, the Company will not, directly
or indirectly, issue any press release or other communication and will
not hold any press conference with respect to the Company, or its
financial condition, results of operations, business, properties, assets,
or prospects or this offering, without your prior written consent.
(l) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or
cause to be paid all expenses incident to the performance of its
obligations under this Agreement, including: (i) the fees, disbursements
and expenses of the Company's counsel and the Company's accountants in
connection with the registration and delivery of the Shares under the
Securities Act and all other fees or expenses in connection with the
preparation and filing of the Registration Statement, any preliminary
prospectus, the Prospectus and amendments and supplements to any of the
foregoing, including all printing costs associated therewith, and the
mailing and delivering of copies thereof to the Underwriters and dealers,
in the quantities hereinabove specified, (ii) all costs and expenses
related to the transfer and delivery of the Shares to the Underwriters,
including any transfer or other taxes payable thereon, (iii) the cost of
printing or producing any Blue Sky or Legal Investment memorandum in
connection with the offer and sale of the Shares under state securities
laws and all expenses in connection with the qualification of the Shares
for offer and sale under state securities laws as provided in Section
6(d) hereof, including filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky or Legal Investment
memorandum, (iv) all filing fees and the reasonable fees and
disbursements of counsel to the Underwriters incurred in connection with
the review and qualification of the offering of the Shares by the
National Association of Securities Dealers, Inc., (v) all fees and
expenses in connection with the preparation and filing of the
registration statement on Form 8-A relating to the Common Stock and all
costs and expenses incident to listing the Shares on the Nasdaq National
Market, (vi) the cost of printing certificates representing the Shares,
(vii) the costs and charges of any transfer agent, registrar or
depositary, (viii) the costs and expenses of the Company relating to
investor presentations on any "road show" undertaken in connection with
the marketing of the offering of the Shares, including, without
limitation, expenses associated with the production of road show slides
and graphics, fees and expenses of any consultants engaged in connection
with the road show presentations with the prior approval of the Company,
travel and lodging expenses of the representatives and officers of the
Company and any such consultants, and the cost of any aircraft chartered
or limousines hired in connection with the road show, (ix) all expenses
in connection with any offer and sale of the Shares outside of the United
States, including filing fees and the reasonable fees and disbursements
of counsel for the Underwriters in connection with offers and sales
outside of the United States, (x) all fees and disbursements of counsel
incurred by the Underwriters in connection with the Directed Share
Program and stamp duties, similar taxes or duties or other taxes, if any,
incurred by the Underwriters in connection with the
17
Directed Share Program, and (xi) all other costs and expenses incident
to the performance of the obligations of the Company hereunder for
which provision is not otherwise made in this Section. It is
understood, however, that except as provided in this Section, Section
7 entitled "Indemnity and Contribution", and the last paragraph of
Section 9 below, the Underwriters will pay all of their costs and
expenses, including fees and disbursements of their counsel, stock
transfer taxes payable on resale of any of the Shares by them and any
advertising expenses connected with any offers they may make.
(m) That in connection with the Directed Share Program, the
Company will ensure that the Directed Shares will be restricted to the
extent 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 the effectiveness of the Registration Statement.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ will notify the Company as to which Participants are
required to be so restricted. The Company will direct the transfer agent
to place stop transfer restrictions upon such securities for such period
of time.
(n) That the Company will comply with all applicable securities
and other applicable laws, rules and regulations in each foreign
jurisdiction in which the Directed Shares are offered in connection with
the Directed Share Program.
7. INDEMNITY AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless
each Underwriter and each person, if any, who controls any Underwriter
within the meaning of either Section 15 of the Securities Act or Section
20 of the Exchange Act, from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or
other expenses reasonably incurred in connection with defending or
investigating any such action or claim) caused by any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement or any amendment thereof, any preliminary prospectus or the
Prospectus (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto), or caused by any
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages or liabilities
are caused by any such untrue statement or omission or alleged untrue
statement or omission based upon information relating to any Underwriter
furnished to the Company in writing by such Underwriter through you
expressly for use therein; provided, however that the foregoing indemnity
with respect to any preliminary prospectus shall not inure to the benefit
of any Underwriter from whom the person asserting any such losses,
claims, damages or liabilities purchased Shares, or any person
controlling such Underwriter, if a copy of the Prospectus (as then
amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) was not sent or given by or on behalf
of such Underwriter to such person, if required by law so to have been
delivered, at or prior to the written confirmation of the
18
sale of the Shares to such person, and if the Prospectus (as so
amended or supplemented) would have cured the defect giving rise to
such losses, claims, damages or liabilities unless such failure is the
result of noncompliance by the Company, with Sections 6(a) or 6(c)
hereof.
(b) The Company agrees to indemnify and hold harmless
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and each person, if any, who controls ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
within the meaning of either Section 15 of the Securities Act or Section
20 of the Exchange Act ("▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ENTITIES"), from and against any
and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred in connection
with defending or investigating any such action or claim) (i) caused by
any untrue statement or alleged untrue statement of a material fact
contained in the prospectus wrapper material prepared by or with the
consent of the Company for distribution in foreign jurisdictions in
connection with the Directed Share Program attached to the Prospectus or
any preliminary prospectus, or caused by any omission or alleged omission
to state therein a material fact required to be stated therein or
necessary to make the statement therein, when considered in conjunction
with the Prospectus or any applicable preliminary prospectus, not
misleading; (ii) caused by the failure of any Participant to pay for and
accept delivery of the shares which, immediately following the
effectiveness of the Registration Statement, were subject to a properly
confirmed agreement to purchase; or (iii) related to, arising out of, or
in connection with the Directed Share Program, provided that, the Company
shall not be responsible under this subparagraph (iii) for any losses,
claim, damages or liabilities (or expenses relating thereto) that are
finally judicially determined to have resulted from the bad faith or
gross negligence of Underwriter Entities.
(c) Each Underwriter agrees, severally and not jointly,
to indemnify and hold harmless the Company, its directors, its officers
who sign the Registration Statement and each person, if any, who controls
the Company within the meaning of either Section 15 of the Securities Act
or Section 20 of the Exchange Act to the same extent as the foregoing
indemnity from the Company to such Underwriter, but only with reference
to information relating to such Underwriter furnished to the Company in
writing by such Underwriter through you expressly for use in the
Registration Statement, any preliminary prospectus, the Prospectus or any
amendments or supplements thereto.
(d) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity may be sought pursuant to Section 7(a), 7(b) or 7(c),
such person (the "INDEMNIFIED PARTY") shall promptly notify the person
against whom such indemnity may be sought (the "INDEMNIFYING PARTY") in
writing and the indemnifying party, upon request of the indemnified
party, shall retain counsel reasonably satisfactory to the indemnified
party to represent the indemnified party and any others the indemnifying
party may designate in such proceeding and shall pay the reasonable fees
and disbursements of such counsel
19
related to such proceeding. In any such proceeding, any indemnified
party shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such indemnified
party unless (i) the indemnifying party and the indemnified party
shall have mutually agreed to the retention of such counsel or (ii)
the named parties to any such proceeding (including any impleaded
parties) include both the indemnifying party and the indemnified party
and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between
them. It is understood that the indemnifying party shall not, in
respect of the legal expenses of any indemnified party in connection
with any proceeding or related proceedings in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in
addition to any local counsel) for all such indemnified parties and
that all such fees and expenses shall be reimbursed as they are
incurred. Such firm shall be designated in writing by ▇▇▇▇▇▇ ▇▇▇▇▇▇▇,
in the case of parties indemnified pursuant to Section 7(a) or 7(b),
and by the Company, in the case of parties indemnified pursuant to
Section 7(c). The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent, but
if settled with such consent or if there be a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the indemnified
party from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying
party to reimburse the indemnified party for fees and expenses of
counsel as contemplated by the second and third sentences of this
paragraph, the indemnifying party agrees that it shall be liable for
any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than 30 days after receipt
by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in
accordance with such request prior to the date of such settlement.
No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional
release of such indemnified party from all liability on claims that
are the subject matter of such proceeding. Notwithstanding anything
contained herein to the contrary, if indemnity may be sought pursuant
to Section 7(b) hereof in respect of such action or proceeding, then
in addition to such separate firm for the indemnified parties, the
indemnifying party shall be liable for the reasonable fees and
expenses of not more than one separate firm (in addition to any local
counsel) for ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ for the defense of any losses, claims,
damages and liabilities arising out of the Directed Share Program, and
all persons, if any, who control ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ within the meaning of
either Section 15 of the Act or Section 20 of the Exchange Act.
(e) To the extent the indemnification provided for in
Section 7(a), 7(b) or 7(c) is unavailable to an indemnified party or
insufficient in respect of any losses, claims, damages or liabilities
referred to therein, then each indemnifying party under such
20
paragraph, in lieu of indemnifying such indemnified party thereunder,
shall contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages or liabilities (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 Shares or (ii) if the allocation
provided by clause 7(e)(i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause 7(e)(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 that
resulted in such losses, claims, damages or liabilities, 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 Shares shall be
deemed to be in the same respective proportions as the net proceeds
from the offering of the Shares (before deducting expenses) received
by the Company and the total underwriting discounts and commissions
received by the Underwriters, in each case as set forth in the table
on the cover of the Prospectus, bear to the aggregate Public Offering
Price of the Shares. 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 the untrue or alleged untrue
statement of a material fact or the 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. The Underwriters' respective obligations to
contribute pursuant to this Section 7 are several in proportion to the
respective number of Shares they have purchased hereunder, and not
joint.
(f) The Company and the Underwriters agree that it would
not be just or equitable if contribution pursuant to this Section 7 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 that
does not take account of the equitable considerations referred to in
Section 7(e). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages and liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of
this Section 7, no Underwriter shall be required to contribute any amount
in excess of the amount by which the total price at which the Shares
underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages that such Underwriter has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. The remedies provided
for in this Section 7 are not exclusive and
21
shall not limit any rights or remedies which may otherwise be available
to any indemnified party at law or in equity.
(g) The indemnity and contribution provisions contained
in this Section 7 and the representations, warranties and other
statements of the Company contained in this Agreement shall remain
operative and in full force and effect regardless of (i) any termination
of this Agreement, (ii) any investigation made by or on behalf of any
Underwriter or any person controlling any Underwriter or by or on behalf
of the Company, its officers or directors or any person controlling the
Company and (iii) acceptance of and payment for any of the Shares.
8. TERMINATION. This Agreement shall be subject to
termination by notice given by you to the Company, if (a) after the execution
and delivery of this Agreement and prior to the Closing Date (i) trading
generally shall have been suspended or materially limited on or by, as the case
may be, any of the New York Stock Exchange, the American Stock Exchange, the
National Association of Securities Dealers, Inc., the Chicago Board of Options
Exchange, the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii)
trading of any securities of the Company shall have been suspended on any
exchange or in any over-the-counter market, (iii) a general moratorium on
commercial banking activities in New York shall have been declared by either
Federal or New York State authorities or (iv) there shall have occurred any
outbreak or escalation of hostilities or any change in financial markets or any
calamity or crisis that, in your judgment, is material and adverse and (b) in
the case of any of the events specified in clauses 8(a)(i) through 8(a)(iv),
such event, singly or together with any other such event, makes it, in your
judgment, impracticable to market the Shares on the terms and in the manner
contemplated in the Prospectus.
9. EFFECTIVENESS; DEFAULTING UNDERWRITERS. This Agreement
shall become effective upon the execution and delivery hereof by the parties
hereto.
If, on the Closing Date or the Option Closing Date, as the case
may be, any one or more of the Underwriters shall fail or refuse to purchase
Shares that it has or they have agreed to purchase hereunder on such date, and
the aggregate number of Shares which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate number of the Shares to be purchased on such date, the other
Underwriters shall be obligated severally in the proportions that the number of
Firm Shares set forth opposite their respective names in Schedule I or Schedule
II bears to the aggregate number of Firm Shares set forth opposite the names of
all such non-defaulting Underwriters, or in such other proportions as you may
specify, to purchase the Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date; PROVIDED
that in no event shall the number of Shares that any Underwriter has agreed to
purchase pursuant to this Agreement be increased pursuant to this Section 9 by
an amount in excess of one-ninth of such number of Shares without the written
consent of such Underwriter. If, on the Closing Date, any Underwriter or
Underwriters shall fail or refuse to purchase Firm
22
Shares and the aggregate number of Firm Shares with respect to which such
default occurs is more than one-tenth of the aggregate number of Firm Shares
to be purchased, and arrangements satisfactory to you and the Company for the
purchase of such Firm Shares are not made within 36 hours after such default,
this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter or the Company. In any such case either you or
the Company shall have the right to postpone the Closing Date, but in no
event for longer than seven days, in order that the required changes, if any,
in the Registration Statement and in the Prospectus or in any other documents
or arrangements may be effected. If, on the Option Closing Date, any
Underwriter or Underwriters shall fail or refuse to purchase Additional
Shares and the aggregate number of Additional Shares with respect to which
such default occurs is more than one-tenth of the aggregate number of
Additional Shares to be purchased, the non-defaulting Underwriters shall have
the option to (i) terminate their obligation hereunder to purchase Additional
Shares or (ii) purchase not less than the number of Additional Shares that
such non-defaulting Underwriters would have been obligated to purchase in the
absence of such default. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any default
of such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any
of them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters as
have so terminated this Agreement with respect to themselves, severally, for all
out-of-pocket expenses (including the fees and disbursements of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
10. COUNTERPARTS. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
11. APPLICABLE LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
23
12. HEADINGS. The headings of the sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed a
part of this Agreement.
Very truly yours,
HEALTHEON CORPORATION
By:________________________________
Name:
Title:
Accepted as of the date hereof
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
▇▇▇▇▇▇▇, SACHS & CO.
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLC
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & COMPANY, LLC
Acting severally on behalf of themselves and the several U.S.
Underwriters named in Schedule I hereto.
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
By:___________________________
Name:
Title:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INTERNATIONAL LIMITED
▇▇▇▇▇▇▇ SACHS INTERNATIONAL
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLC
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & COMPANY, LLC
Acting severally on behalf of themselves and the several International
Underwriters named in Schedule II hereto.
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International Limited
By: ____________________________
Name:
Title:
24
SCHEDULE I
U.S. UNDERWRITERS
Number of Firm
Underwriter Shares To Be Purchased
----------- ----------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇ Sachs & Co.
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLC
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & Company, LLC
----------------------
Total U.S. Firm Shares:
----------------------
----------------------
SCHEDULE II
INTERNATIONAL UNDERWRITERS
Number of Firm
Underwriter Shares To Be Purchased
----------- ----------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. International Limited
▇▇▇▇▇▇▇ Sachs International
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ LLC
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & Company, LLC
----------------------
Total International Firm Shares:
----------------------
----------------------