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ADVANCEPCS
(a Delaware corporation)
5,151,249 shares Class A Common Stock,
par value $.01 per share
PURCHASE AGREEMENT
Dated: August 20, 2001
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TABLE OF CONTENTS
PAGE
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SECTION 1. Representations and Warranties..................................................................2
(a) Representations and Warranties by the Company..........................................2
(i) Compliance with Registration Requirements.....................................3
(ii) Incorporated Documents........................................................3
(iii) Independent Accountants.......................................................4
(iv) Financial Statements of the Company...........................................4
(v) Financial Statements of PCS Holding Corporation...............................4
(vi) No Material Adverse Change in Business........................................4
(vii) Good Standing of the Company..................................................5
(viii) Good Standing of Subsidiaries.................................................5
(ix) Capitalization................................................................5
(x) Authorization of Agreement and Registration Statement.........................6
(xi) Authorization and Description of Securities...................................6
(xii) Absence of Defaults and Conflicts.............................................6
(xiii) Absence of Labor Dispute......................................................7
(xiv) Absence of Proceedings........................................................7
(xv) Accuracy of Exhibits..........................................................7
(xvi) Possession of Intellectual Property...........................................7
(xvii) Absence of Further Requirements...............................................8
(xviii) Possession of Licenses and Permits............................................8
(xix) Title to Property.............................................................8
(xx) Compliance with Cuba Act......................................................9
(xxi) Investment Company Act........................................................9
(xxii) Environmental Laws............................................................9
(xxiii) Registration Rights...........................................................9
(xxiv) Medicare Violations...........................................................9
(xxv) No Medicare Recoupment.......................................................10
(b) Representations and Warranties by the Selling Stockholders............................10
(i) Accurate Disclosure - ▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇..................................10
(ii) Accurate Disclosure - JLL....................................................10
(iii) Authorization of Agreements..................................................10
(iv) Absence of Manipulation......................................................11
(v) Absence of Further Requirements..............................................11
(vi) Restriction on Sale of Securities............................................11
(vii) No Association with NASD.....................................................11
(viii) Direct Holder of Securities; Title to Securities.............................12
(ix) JLL Certificates Suitable for Transfer.......................................12
(x) ▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇ Certificates Suitable for Transfer.............12
(c) Officer's Certificates................................................................12
SECTION 2. Sale and Delivery to Underwriters; Closing.....................................................12
(a) Initial Securities....................................................................12
(b) Option Securities.....................................................................13
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(c) Payment...............................................................................13
(d) Denominations; Registration...........................................................14
SECTION 3. Covenants of the Company.......................................................................14
(a) Compliance with Securities Regulations and Commission Requests........................14
(b) Filing of Amendments..................................................................14
(c) Delivery of Registration Statements...................................................15
(d) Delivery of Prospectus................................................................15
(e) Continued Compliance with Securities Laws.............................................15
(f) Blue Sky Qualifications...............................................................16
(g) Rule 158..............................................................................16
(h) Listing...............................................................................16
(i) Restriction on Sale of Securities.....................................................16
(j) Reporting Requirements................................................................17
SECTION 4. Payment of Expenses............................................................................17
(a) Expenses..............................................................................17
(b) Expenses of the Selling Stockholders..................................................17
(c) Termination of Agreement..............................................................17
(d) Allocation of Expenses................................................................18
SECTION 5. Conditions of Underwriters' Obligations........................................................18
(a) Effectiveness of Registration Statement...............................................18
(b) Opinion of Counsel for Company........................................................18
(c) Opinion of Special Regulatory Counsel for Company.....................................18
(d) Opinion of Counsel for JLL............................................................18
(e) Opinion of Counsel for ▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇..................................19
(f) Opinion of Counsel for Underwriters...................................................19
(g) Opinion of In-House Counsel...........................................................19
(h) Opinion of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇..........................................................19
(i) Officers' Certificate.................................................................19
(j) Certificate of Selling Stockholders...................................................20
(k) Comfort Letter of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP.................................................20
(l) Bring-Down Comfort Letter of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP......................................20
(m) Comfort Letter of Ernst & Young LLP...................................................20
(n) Bring-down Comfort Letter of Ernst & Young LLP........................................20
(o) Approval of Listing...................................................................21
(p) No Objection..........................................................................21
(q) Conditions to Purchase of Option Securities...........................................21
(r) Additional Documents..................................................................22
(s) Termination of Agreement..............................................................22
SECTION 6. Indemnification................................................................................22
(a) Indemnification of Underwriters.......................................................22
(b) Indemnification of the Underwriters by the Selling Stockholders.......................23
(c) Indemnification of Company, Directors and Officers and Selling Stockholders...........24
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(d) Actions against Parties; Notification.................................................24
(e) Settlement without Consent if Failure to Reimburse....................................25
(f) Other Agreements with Respect to Indemnification......................................25
SECTION 7. Contribution...................................................................................25
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.................................26
SECTION 9. Termination of Agreement.......................................................................26
(a) Termination; General..................................................................26
(b) Liabilities...........................................................................27
SECTION 10. Default by One or More of the Underwriters.....................................................27
SECTION 11. Default by One or More of the Selling Stockholders or the Company..............................28
SECTION 12. Notices........................................................................................28
SECTION 13. Parties........................................................................................29
SECTION 14. Governing Law and Time.........................................................................29
SECTION 15. Effect of Headings.............................................................................29
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SCHEDULES
Schedule A - List of Underwriters................................................Sch A-1
Schedule B - List of Selling Stockholders .......................................Sch B-1
Schedule C - Pricing Information.................................................Sch C-1
Schedule D - List of Subsidiaries................................................Sch D-1
EXHIBITS
Exhibit A - Form of Opinion of Company's Counsel.....................................A-1
Exhibit B - Form of Opinion of Company's Special Regulatory Counsel..................B-1
Exhibit C - Form of Opinion of JLL's Counsel.........................................C-1
Exhibit D - Form of Opinion of ▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇'▇ Counsel ..............D-1
Exhibit E - Form of Opinion of In-House Counsel......................................E-1
Exhibit F - Form of Opinion of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇.....................................F-1
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ADVANCEPCS
(a Delaware corporation)
5,151,249 Shares of Class A Common Stock
(Par Value $.01 Per Share)
PURCHASE AGREEMENT
August 20, 2001
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
AdvancePCS, a Delaware corporation (the "Company"), ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
an individual residing in the State of Texas ("▇▇▇▇▇ ▇▇▇▇▇▇▇"), ▇▇▇ ▇. ▇▇▇▇▇▇▇,
an individual residing in the State of Texas ("▇▇▇ ▇▇▇▇▇▇▇") and ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇ Fund III, L.P., a limited partnership ("JLL" and together with
▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇, the "Selling Stockholders"), confirm their
respective agreements with ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. and each of the other
Underwriters named in Schedule A hereto (collectively, the "Underwriters," which
term shall also include any underwriter substituted as hereinafter provided in
Section 10 hereof), with respect to (i) the sale by the Company, and the
purchase by the Underwriters, acting severally and not jointly, of the
respective numbers of shares of Class A common stock, par value $.01 per share,
of the Company ("Common Stock") set forth in Schedules A and B hereto, (ii) the
sale by the Selling Stockholders, and the purchase by the Underwriters, acting
severally and not jointly, of the respective number of shares of Common Stock
set forth in Schedules A and B hereto, and (iii) the grant by the Company to the
Underwriters, acting severally and not jointly, of the option described in
Section 2(b) hereof to purchase all or any part of 500,000 additional shares of
Common Stock to cover over-allotments, if any. The aforesaid 5,151,249 shares of
Common Stock (the "Initial Securities") to be purchased by the Underwriters and
all or any part of the 500,000 shares of Common Stock subject to the option
described in Section 2(b) hereof (the "Option Securities") are hereinafter
called, collectively, the "Securities".
The Company and the Selling Stockholders understand that the
Underwriters propose to make a public offering of the Securities as soon as
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. deems advisable after this Agreement has been executed and
delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-61832) covering the
registration of the Securities under the Securities Act of 1933, as amended (the
"1933 Act"), including the related preliminary prospectus or prospectuses.
Promptly after execution and delivery of this
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Agreement, the Company will either (i) prepare and file a prospectus in
accordance with the provisions of Rule 430A ("Rule 430A") of the rules and
regulations of the Commission under the 1933 Act (the "1933 Act Regulations")
and paragraph (b) of Rule 424 ("Rule 424(b)") of the 1933 Act Regulations or
(ii) if the Company has elected to rely upon Rule 434 ("Rule 434") of the 1933
Act Regulations, prepare and file a term sheet (a "Term Sheet") in accordance
with the provisions of Rule 434 and Rule 424(b). The information included in any
such prospectus or in any such Term Sheet, as the case may be, that was omitted
from such registration statement at the time it became effective but that is
deemed to be part of such registration statement at the time it became effective
(a) pursuant to paragraph (b) of Rule 430A is referred to as "Rule 430A
Information" or (b) pursuant to paragraph (d) of Rule 434 is referred to as
"Rule 434 Information." Each prospectus used before such registration statement
became effective, and any prospectus that omitted, as applicable, the Rule 430A
Information or the Rule 434 Information, that was used after such effectiveness
and prior to the execution and delivery of this Agreement, is herein called a
"preliminary prospectus". Such registration statement, including the exhibits
thereto, schedules thereto, if any, and the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 under the 1933 Act, at the time it
became effective and including the Rule 430A Information and the Rule 434
Information, as applicable, is herein called the "Registration Statement." Any
registration statement filed pursuant to Rule 462(b) of the 1933 Act Regulations
is herein referred to as the "Rule 462(b) Registration Statement," and after
such filing the term "Registration Statement" shall include the Rule 462(b)
Registration Statement. The final prospectus, including the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933
Act, in the forms first furnished to the Underwriters for use in connection with
the offering of the Securities are herein called the "Prospectus". For purposes
of this Agreement, all references to the Registration Statement, any preliminary
prospectus, the Prospectus, or any Term Sheet or any amendment or supplement to
any of the foregoing shall be deemed to include the copy filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
system ("▇▇▇▇▇").
All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary prospectus or the Prospectus (or other
references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is incorporated
by reference in the Registration Statement, any preliminary prospectus or the
Prospectus, as the case may be; and all references in this Agreement to
amendments or supplements to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to mean and include the filing of
any document under the Securities Exchange Act of 1934 (the "1934 Act") which is
incorporated by reference in the Registration Statement, such preliminary
prospectus or the Prospectus, as the case may be.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company. The Company
represents and warrants to each Underwriter as of the date hereof, as of the
Closing Time referred to in Section 2(c) hereof, and as of each Date of Delivery
(if any) referred to in Section 2(b) hereof, and agrees with each Underwriter,
as follows:
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(i) Compliance with Registration Requirements. The Company
meets the requirements for use of Form S-3 under the 1933 Act. Each of
the Registration Statement and any Rule 462(b) Registration Statement
has become effective under the 1933 Act and no stop order suspending
the effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission, and
any request on the part of the Commission for additional information
has been complied with.
At the respective times the Registration Statement, any
Rule 462(b) Registration Statement and any post-effective amendments
thereto became effective and at the Closing Time (and, if any Option
Securities are purchased, at the Date of Delivery), the Registration
Statement, the Rule 462(b) Registration Statement and any amendments
and supplements thereto complied and will comply in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations and did not and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading.
Neither the Prospectus nor any amendments or supplements thereto, at
the time the Prospectus or any such amendment or supplement was issued
and at the Closing Time (and, if any Option Securities are purchased,
at the Date of Delivery), included or will include an untrue statement
of a material fact or omitted or will omit to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. If Rule 434
is used, the Company will comply with the requirements of Rule 434. The
representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement, the
Prospectus or any amendments or supplements thereto made in reliance
upon and in conformity with information furnished to the Company in
writing by any Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. expressly for
use in the Registration Statement or the Prospectus.
Each preliminary prospectus and any prospectus
supplement filed as part of the Registration Statement as originally
filed or as part of any amendment thereto, or filed pursuant to Rule
424 under the 1933 Act, complied when so filed in all material respects
with the 1933 Act Regulations and each preliminary prospectus and the
Prospectus delivered to the Underwriters for use in connection with
this offering was identical to the electronically transmitted copies
thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the
extent permitted by Regulation S-T.
(ii) Incorporated Documents. The documents incorporated or
deemed to be incorporated by reference in the Registration Statement
and the Prospectus, when they became effective or at the time they were
or hereafter are filed with the Commission, complied and will comply in
all material respects with the requirements of the 1933 Act and the
1933 Act Regulations or the 1934 Act and the rules and regulations of
the Commission thereunder (the "1934 Act Regulations"), as applicable,
and, when read together with the other information in the Prospectus,
at the time the Registration Statement became effective, at the time
the Prospectus was issued and at the Closing Time (and if any Option
Securities are purchased, at the Date of Delivery), did not and
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will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading.
(iii) Independent Accountants. The accountants who certified
the financial statements and supporting schedules included or
incorporated by reference in the Registration Statement are independent
public accountants as required by the 1933 Act and the 1933 Act
Regulations.
(iv) Financial Statements of the Company. The financial
statements of the Company and its consolidated subsidiaries included
and incorporated by reference in the Registration Statement and the
Prospectus, together with the related schedules and notes, present
fairly the financial position of the Company and its consolidated
subsidiaries at the dates indicated and the statement of operations,
stockholders' equity and cash flows of the Company and its consolidated
subsidiaries for the periods specified; said financial statements have
been prepared in conformity with generally accepted accounting
principles ("GAAP") applied on a consistent basis throughout the
periods involved. The supporting schedules, if any, included in the
Registration Statement present fairly in accordance with GAAP the
information required to be stated therein. The selected financial data
and the summary financial information included in the Prospectus
present fairly the information shown therein and have been compiled on
a basis consistent with that of the audited financial statements
included in the Registration Statement. The pro forma financial
statements and the related notes thereto included and incorporated by
reference in the Registration Statement and the Prospectus present
fairly the information shown therein, have been prepared in accordance
with the Commission's rules and guidelines with respect to pro forma
financial statements and have been properly compiled on the bases
described therein, and the assumptions used in the preparation thereof
are reasonable and the adjustments used therein are appropriate to give
effect to the transactions and circumstances referred to therein.
(v) Financial Statements of PCS Holding Corporation. The
financial statements of PCS Holding Corporation, a Delaware corporation
("PCS"), and its consolidated subsidiaries included and incorporated by
reference in the Registration Statement and the Prospectuses, together
with the related schedules and notes, present fairly the financial
position of PCS and its consolidated subsidiaries at the dates
indicated and the statement of operations, stockholders' equity and
cash flows of PCS and its consolidated subsidiaries for the periods
specified; said financial statements have been prepared in conformity
with GAAP applied on a consistent basis throughout the periods
involved.
(vi) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, except as otherwise stated therein or
incorporated by reference, (A) there has been no material adverse
change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in
the ordinary course of business (a "Material Adverse Effect"), (B)
there have been no transactions entered into by the Company or any of
its subsidiaries, other than those in the ordinary course of business,
which are material with
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respect to the Company and its subsidiaries considered as one
enterprise, and (C) there has been no dividend or distribution of any
kind declared, paid or made by the Company on any class of its capital
stock.
(vii) Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Delaware and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus and to enter into and perform
its obligations under this Agreement; and the Company is duly qualified
as a foreign corporation to transact business and is in good standing
in each other jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in
good standing would not result in a Material Adverse Effect.
(viii) Good Standing of Subsidiaries. Each "significant
subsidiary" of the Company (as such term is defined in Rule 1-02 of
Regulation S-X) (each a "Subsidiary" and, collectively, the
"Subsidiaries") has been duly organized and is validly existing as a
corporation, limited liability company or limited partnership in good
standing under the laws of the jurisdiction of its organization, has
corporate, limited liability company or limited partnership power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus and is duly qualified as a
foreign entity to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of business,
except where the failure so to qualify or to be in good standing would
not result in a Material Adverse Effect; except as otherwise disclosed
in the Registration Statement, all of the issued and outstanding
capital stock of each such Subsidiary has been duly authorized and
validly issued, is fully paid and non-assessable and is owned by the
Company, directly or through Subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or
equity, except for such security interests, mortgages, pledges, liens,
encumbrances, claims or equities resulting pursuant to the terms of the
Credit Agreement dated as of October 2, 2000, among the Company, the
subsidiary guarantors parties thereto, Bank of America, N.A., as
administrative agent, the other agents parties thereto, the lender
parties thereto and the arrangers named therein, as amended by the
Amendment No. 1 to the Credit Agreement dated as of November 3, 2000
and the Amendment No. 2 to the Credit Agreement dated as of June 22,
2001 and any related documents, including any amendments and
supplements thereto; none of the outstanding shares of capital stock of
any Subsidiary was issued in violation of the preemptive or similar
rights of any securityholder of such subsidiary. The only subsidiaries
of the Company are the subsidiaries listed on Schedule D hereto.
(ix) Capitalization. The authorized, issued and outstanding
capital stock of the Company is as set forth in the Annual Report of
the Company on Form 10-K for the fiscal year ended March 31, 2001 as
filed with the Commission on June 29, 2001 in the column entitled
"Actual" under the caption "Capitalization" (except for subsequent
issuances, if any, pursuant to this Agreement, pursuant to
reservations, agreements or employee benefit plans referred to in the
Prospectus or pursuant to the exercise of
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convertible securities, warrants or options referred to in the
Prospectus). The shares of issued and outstanding capital stock of the
Company, including the securities to be purchased by the Underwriters
from the Selling Stockholders, have been duly authorized and validly
issued and are fully paid and non-assessable; none of the outstanding
shares of capital stock of the Company, including the securities to be
purchased by the Underwriters from the Selling Stockholders, was issued
in violation of the preemptive or other similar rights of any
securityholder of the Company.
(x) Authorization of Agreement and Registration Statement.
This Agreement has been duly authorized, executed and delivered by the
Company. The Registration Statement and the Prospectus and the filing
of the Registration Statement and the Prospectus with the Commission
have been duly authorized by and on behalf of the Company, and the
Registration Statement has been duly signed by and on behalf of the
Company pursuant to such authorization.
(xi) Authorization and Description of Securities. The
Securities to be purchased by the Underwriters from the Company have
been duly authorized for issuance and sale to the Underwriters pursuant
to this Agreement and, when issued and delivered by the Company
pursuant to this Agreement against payment of the consideration set
forth herein, will be validly issued, fully paid and non-assessable;
the Common Stock conforms in all material respects to all statements
relating thereto contained or incorporated by reference in the
Prospectus and such description conforms in all material respects to
the rights set forth in the instruments defining the same; no holder of
the Securities will be subject to personal liability by reason of being
such a holder; and the issuance of the Securities pursuant to the
Company's Certificate of Incorporation or Bylaws or applicable law or
any agreement or instrument to which the Company is a party or by which
the Company is bound which has not otherwise been waived by such
securityholder.
(xii) Absence of Defaults and Conflicts. None of the Company
or any of its subsidiaries is in violation of its charter or by-laws or
in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, lease or other
agreement or instrument to which the Company or any of its subsidiaries
is a party or by which it or any of them may be bound, or to which any
of the property or assets of the Company or any subsidiary is subject
(collectively, "Agreements and Instruments") except for such defaults
that would not result in a Material Adverse Effect; and the execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated in this Agreement, and in the Registration
Statement and compliance by the Company with its obligations hereunder
have been duly authorized by all necessary corporate action and do not
and will not, whether with or without the giving of notice or passage
of time or both, conflict with or constitute a breach of, or default or
Repayment Event (as defined below) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any subsidiary pursuant to, the Agreements and
Instruments (except for such conflicts, breaches or defaults or liens,
charges or encumbrances that would not result in a Material Adverse
Effect), nor will such action result in any violation of the provisions
of the
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charter or by-laws of the Company or any subsidiary, or any applicable
law, statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Company or any subsidiary or any of their
assets, properties or operations, except for such violations of
applicable law, statute, rule, regulation, judgment, order or decree
that would not result in a Material Adverse Effect. As used herein, a
"Repayment Event" means any event or condition which gives the holder
of any note, debenture or other evidence of indebtedness (or any person
acting on such holder's behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such indebtedness by the
Company or any subsidiary.
(xiii) Absence of Labor Dispute. No labor dispute with the
employees of the Company or any subsidiary exists or, to the knowledge
of the Company, is imminent, and the Company is not aware of any
existing or imminent labor disturbance by the employees of any of its
or any subsidiary's principal suppliers, manufacturers, customers or
contractors, which, in either case, may reasonably be expected to
result in a Material Adverse Effect.
(xiv) Absence of Proceedings. Except as disclosed or
incorporated by reference in the Registration Statement, there is no
action, suit, proceeding, inquiry or investigation before or brought by
any court or governmental agency or body, domestic or foreign, now
pending, or, to the knowledge of the Company, threatened, against or
affecting the Company or any subsidiary, which is required to be
disclosed in the Registration Statement (other than as disclosed
therein), or which might reasonably be expected to result in a Material
Adverse Effect, or which might reasonably be expected to materially and
adversely affect the properties or assets thereof or the consummation
of the transactions contemplated in this Agreement or the performance
by the Company of its obligations hereunder; the aggregate of all
pending legal or governmental proceedings to which the Company or any
subsidiary is a party or of which any of their respective property or
assets is the subject which are not described in the Registration
Statement, including ordinary routine litigation incidental to the
business of the Company or any such subsidiary, could not reasonably be
expected to result in a Material Adverse Effect.
(xv) Accuracy of Exhibits. There are no contracts or documents
which are required to be described in the Registration Statement, the
Prospectus or the documents incorporated by reference therein or to be
filed as exhibits thereto which have not been so described and filed as
required.
(xvi) Possession of Intellectual Property. The Company and its
subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary
to carry on the business now operated by them, and neither the Company
nor any of its subsidiaries has received any notice or is otherwise
aware of any infringement of or conflict with asserted rights of others
with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual
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Property invalid or inadequate to protect the interest of the Company
or any of its subsidiaries therein, and which infringement or conflict
(if the subject of any unfavorable decision, ruling or finding) or
invalidity or inadequacy, singly or in the aggregate, would result in a
Material Adverse Effect.
(xvii) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or
agency is necessary or required for the performance by the Company of
its obligations hereunder, in connection with the offering, issuance or
sale of the Securities under this Agreement or the consummation of the
transactions contemplated by this Agreement, except such as have been
already obtained or as may be required under the 1933 Act or the 1933
Act Regulations or state securities laws.
(xviii) Possession of Licenses and Permits. The Company and
its subsidiaries possess such permits, licenses, approvals, consents
and other authorizations (collectively, "Governmental Licenses"),
including certificates of need, licenses, pharmacy licenses, Medicare
provider numbers, accreditations and other similar documentation or
approvals of any local health departments of any authority, issued by
the appropriate federal, state, local or foreign regulatory agencies or
bodies necessary to conduct the business now operated by them; the
Company and its subsidiaries are in compliance with the terms and
conditions of all such Governmental Licenses, except where the failure
so to comply would not, singly or in the aggregate, have a Material
Adverse Effect; all of the Governmental Licenses are valid and in full
force and effect, except where the invalidity of such Governmental
Licenses or the failure of such Governmental Licenses to be in full
force and effect would not, singly or in the aggregate, have a Material
Adverse Effect; and neither the Company nor any of its subsidiaries has
received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in a Material Adverse Effect.
(xix) Title to Property. The Company and its subsidiaries have
good and marketable title to all real property owned by the Company and
its subsidiaries and, to the best knowledge of the Company, good title
to all other properties owned by them, in each case, free and clear of
all mortgages, pledges, liens, security interests, claims, restrictions
or encumbrances of any kind except such as (a) are described in the
Prospectus or (b) do not, singly or in the aggregate, materially affect
the value of such property and do not materially interfere with the use
made and proposed to be made of such property by the Company or any of
its subsidiaries; and all of the leases and subleases material to the
business of the Company and its subsidiaries, considered as one
enterprise, and under which the Company or any of its subsidiaries
holds properties described in the Prospectus, are in full force and
effect, and neither the Company nor any subsidiary has any notice of
any material claim of any sort that has been asserted by anyone adverse
to the rights of the Company or any subsidiary under any of the leases
or subleases mentioned above, or affecting or questioning the rights of
the Company or such subsidiary to the continued possession of the
leased or subleased premises under any such lease or sublease which, if
the subject of an unfavorable decision, ruling or finding, would result
in a Material Adverse Effect.
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(xx) Compliance with Cuba Act. The Company has complied with,
and is and will be in compliance with, the provisions of that certain
Florida act relating to disclosure of doing business with Cuba,
codified as Section 517.075 of the Florida statutes, and the rules and
regulations thereunder (collectively, the "Cuba Act") or is exempt
therefrom.
(xxi) Investment Company Act. The Company is not, and upon the
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the
Prospectus will not be, an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in
the Investment Company Act of 1940, as amended (the "1940 Act").
(xxii) Environmental Laws. Except as disclosed in the
Registration Statement and except as would not, singly or in the
aggregate, result in a Material Adverse Effect, (A) neither the Company
nor any of its subsidiaries is in violation of any federal, state,
local or foreign statute, law, rule, regulation, ordinance, code, or
any judicial or administrative interpretation thereof, including any
judicial or administrative order, consent, decree or judgment, relating
to pollution or protection of human health, the environment (including,
without limitation, ambient air, surface water, groundwater, land
surface or subsurface strata) or wildlife, including, without
limitation, laws and regulations relating to the release or threatened
release of chemicals, pollutants, contaminants, wastes, toxic
substances, hazardous substances, petroleum or petroleum products
(collectively, "Hazardous Materials") or to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport
or handling of Hazardous Materials (collectively, "Environmental
Laws"), (B) the Company and its subsidiaries have all permits,
authorizations and approvals required under any applicable
Environmental Laws and are each in compliance with their requirements,
(C) there are no pending or, to the best knowledge of the Company,
threatened administrative, regulatory or judicial actions, suits,
demands, demand letters, claims, liens, notices of noncompliance or
violation, investigation or proceedings relating to any Environmental
Law against the Company or any of its subsidiaries and (D) to the best
knowledge of the Company, there are no events or circumstances that
might reasonably be expected to form the basis of an order for clean-up
or remediation, or an action, suit or proceeding by any private party
or governmental body or agency, against or affecting the Company or any
of its subsidiaries relating to Hazardous Materials or any
Environmental Laws.
(xxiii) Registration Rights. Except as disclosed or
incorporated by reference in the Prospectus, there are no persons with
registration rights or other similar rights to have any securities
registered pursuant to the Registration Statement or otherwise
registered by the Company under the 1933 Act.
(xxiv) Medicare Violations. To the best knowledge of the
Company and its subsidiaries, persons who provide professional services
under agreements with the Company and/or the subsidiaries, have not
engaged in any activities which are prohibited, or are cause for civil
penalties or mandatory or permissive exclusion from Medicare or
Medicaid, under Section 1320a-7, 1320a-7a, 1302a-7b or 1395nn of Title
42 of the United States Code, the federal CHAMPUS statute or the
regulations promulgated pursuant to such statutes or related state or
local statutes or regulations, standards of
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accreditation applicable to the Company or the subsidiaries or rules of
professional conduct, which activities might reasonably be expected to
result in sanctions (financial or otherwise) that would, singly or in
the aggregate, have a Material Adverse Effect.
(xxv) No Medicare Recoupment. To the best knowledge of the
Company, except as disclosed in the Prospectus, there is no Medicare,
Medicaid or CHAMPUS recoupment or recoupments of any other third-party
payor being sought, threatened, requested or claimed against the
Company or any subsidiary.
(b) Representations and Warranties by the Selling Stockholders. Each of
the Selling Stockholders, severally and not jointly, represents and warrants to
each Underwriter as of the date hereof, as of the Closing Time, and agrees with
each Underwriter, as follows:
(i) Accurate Disclosure - ▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇. To the best
knowledge of each of ▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇, the representations
and warranties of the Company contained in Section 1(a) hereof are true
and correct. Each of ▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇ has reviewed and is
familiar with the Registration Statement and the Prospectus and neither
the Prospectus nor any amendments or supplements thereto includes any
untrue statement of material fact or omits to state a material fact
necessary in order to make the statements therein, in light of the
circumstances in which they were made, not misleading. Neither ▇▇▇
▇▇▇▇▇▇▇ nor ▇▇▇▇▇ ▇▇▇▇▇▇▇ is prompted to sell the Securities to be sold
by him hereunder by any information concerning the Company or any
subsidiary of the Company which is not set forth in the Prospectus.
(ii) Accurate Disclosure - JLL. To the extent that any
statements or omissions made in the Registration Statement, any
preliminary prospectus, the Prospectus or any amendment or supplement
thereto are made in reliance upon and in conformity with information
furnished to the Company by JLL expressly for use therein, such
preliminary prospectus and the Registration Statement did, and the
Prospectus and any further amendments or supplements to the
Registration Statement and the Prospectus, when they become effective
or are filed with the Commission, as the case may be, will conform in
all material respects to the requirements of the 1933 Act and the rules
and regulations of the Commission thereunder and will not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading.
(iii) Authorization of Agreements. Such Selling Stockholder
has the full right, power and authority to enter into this Agreement
and to sell, transfer and deliver the Securities to be sold by such
Selling Stockholder hereunder. The execution and delivery of this
Agreement and the sale and delivery of the Securities to be sold by
such Selling Stockholder and the consummation of the transactions
contemplated herein and compliance by such Selling Stockholder with
their obligations hereunder have been duly authorized by such Selling
Stockholder and do not and will not, whether with or without the giving
of notice or passage of time or both, conflict with or constitute a
breach of, or default under, or result in the creation or imposition of
any tax, lien, charge or encumbrance upon the Securities to be sold by
such Selling Stockholder or any property or assets of such Selling
Stockholder pursuant to any contract, indenture, mortgage, deed
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of trust, loan or credit agreement, note, license, lease or other
agreement or instrument to which such Selling Stockholder is a party or
by which such Selling Stockholder may be bound, or to which any of the
property or assets of such Selling Stockholder is subject, except were
failure or breach would not have a Material Adverse Effect on such
Selling Stockholder's ability to perform its obligation herein, nor
will such action result in any violation of the provisions of the
charter or by-laws or other organizational instrument of such Selling
Stockholder, if applicable, or any applicable treaty, law, statute,
rule, regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having
jurisdiction over such Selling Stockholder or any of its properties
except were failure or breach would not have a Material Adverse Effect
on such Selling Stockholder's ability to perform its obligation herein.
(iv) Absence of Manipulation. Such Selling Stockholder has not
taken, and will not take, directly or indirectly, any action which is
designed to or which has constituted or which might reasonably be
expected to cause or result in stabilization or manipulation of the
price of any security of the Company to facilitate the sale or resale
of the Securities.
(v) Absence of Further Requirements. No filing with, or
consent, approval, authorization, order, registration, qualification or
decree of, any court or governmental authority or agency, domestic or
foreign, is necessary or required for the performance by such Selling
Stockholder of their obligations hereunder, or in connection with the
sale and delivery of the Securities hereunder or the consummation of
the transactions contemplated by this Agreement, except such as may
have previously been made or obtained or as may be required under the
1933 Act or the 1933 Act Regulations or state securities laws.
(vi) Restriction on Sale of Securities. Except for the
transactions contemplated by this Agreement, during a period of 75 days
from the date of the Prospectus, such Selling Stockholder will not,
without the prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., (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 or otherwise transfer or dispose of,
directly or indirectly, any share of Common Stock or any securities
convertible into or exercisable or exchangeable for Common Stock or
file any registration statement under the 1933 Act with respect to any
of the foregoing or (ii) enter into any swap or any other agreement or
any transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Common Stock,
whether any such swap or transaction described in clause (i) or (ii)
above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise; provided that JLL may transfer 17,084
shares of Common Stock to its general partner (JLL Associates, L.L.C.)
or members or affiliates of its general partner. The foregoing
restrictions shall not apply to the Securities to be sold hereunder.
(vii) No Association with NASD. Neither such Selling
Stockholder nor any of its affiliates directly, or indirectly through
one or more intermediaries, controls, or is controlled by, or is under
common control with, or has any other association with (within
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the meaning of Article I, Section 1(m) of the By-laws of the National
Association of Securities Dealers, Inc.), any member firm of the
National Association of Securities Dealers, Inc.
(viii) Direct Holder of Securities; Title to Securities. The
Securities to be sold by each Selling Stockholder pursuant to this
Agreement will be certificated securities in registered form and will
not be held in any securities account or by or through any securities
intermediary within the meaning of the Uniform Commercial Code as in
effect in the State of
New York ("NYUCC"). Each Selling Stockholder
has, and, at the Closing Time, will have, full right, power and
authority to hold, sell, transfer and deliver the Securities to be sold
by such Selling Stockholder pursuant to this Agreement; and upon the
Underwriters' acquiring possession of such Securities (or an agent's
acquiring possession of such Securities on the Underwriter's behalf)
and paying the purchase price therefor as herein contemplated, the
Underwriters will acquire their respective interests in such Securities
(including, without limitation, all rights that the Selling
Stockholders had or have the power to transfer in such Securities) free
and clear of any adverse claim.
(ix) JLL Certificates Suitable for Transfer. Certificates for
all of the Securities to be sold by JLL pursuant to this Agreement, in
suitable form for transfer by delivery or accompanied by duly executed
instruments of transfer or assignment in blank with signatures
guaranteed, will, prior to the Closing Time or each Date of Delivery,
as the case may be, have been placed in custody with Debevoise &
▇▇▇▇▇▇▇▇, counsel for JLL, with irrevocable conditional instructions to
deliver such Securities to the Underwriters (or an agent designated by
the Underwriters to acquire possession of the Securities on the
Underwriter's behalf) pursuant to this Agreement.
(x) ▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇ Certificates Suitable for
Transfer. Certificates for all of the Securities to be sold by ▇▇▇▇▇
▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇ pursuant to this Agreement, in suitable form
for transfer by delivery or accompanied by duly executed instruments of
transfer or assignment in blank with signatures guaranteed, will, prior
to the Closing Time or each Date of Delivery, as the case may be, have
been placed in custody with Akin, Gump, Strauss, ▇▇▇▇▇ & ▇▇▇▇, L.L.P.,
counsel for ▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇, with irrevocable conditional
instructions to deliver such Securities to the Underwriters pursuant to
this Agreement.
(c) Officer's Certificates. Any certificate signed by any officer of
the Company or any of its subsidiaries delivered to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. or to
counsel for the Underwriters pursuant to the terms of this Agreement shall be
deemed a representation and warranty by the Company to each Underwriter as to
the matters covered thereby; and any certificate signed by or on behalf of the
Selling Stockholders as such and delivered to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. or to counsel
for the Underwriters pursuant to the terms of this Agreement shall be deemed a
representation and warranty by the Selling Stockholders to the Underwriters as
to the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Initial Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company and the Selling
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Stockholders agree to sell to each Underwriter, and each Underwriter, severally
and not jointly, agrees to purchase from the Company and the Selling
Stockholders, at the price per share set forth in Schedule C, the number of
Initial Securities set forth in Schedule B opposite the name of the Company and
the Selling Stockholders which the number of Initial Securities set forth in
Schedule A opposite the name of such Underwriter, plus any additional number of
Initial Securities which such Underwriter may become obligated to purchase
pursuant to the provisions of Section 10 hereof, bears to the total number of
Initial Securities, subject, in each case, to such adjustments among the
Underwriters as ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. in its sole discretion shall make to
eliminate any sales or purchases of fractional securities.
(b) Option Securities. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company grants an option to the Underwriters to purchase up to an
additional 500,000 shares of Common Stock, as set forth in Schedule B, at the
price per share set forth in Schedule C, less an amount per share equal to any
dividends or distributions declared by the Company and payable on the Initial
Securities but not payable on the Option Securities. The option hereby granted
will expire 30 days after the date hereof and may be exercised in whole or in
part from time to time only for the purpose of covering over-allotments which
may be made in connection with the offering and distribution of the Initial
Securities upon notice by ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. to the Company setting forth the
number of Option Securities as to which the several Underwriters are then
exercising the option and the time and date of payment and delivery for such
Option Securities. Any such time and date of delivery for the Option Securities
(a "Date of Delivery") shall be determined by ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., but shall not
be later than seven full business days after the exercise of said option, nor in
any event prior to the Closing Time, as hereinafter defined. If the option is
exercised as to all or any portion of the Option Securities, each of the
Underwriters, acting severally and not jointly, will purchase that proportion of
the total number of Option Securities then being purchased which the number of
Initial Securities set forth in Schedule A opposite the name of such Underwriter
bears to the total number of Initial Securities, subject in each case to such
adjustments as ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. in its discretion shall make to eliminate any
sales or purchases of fractional shares.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of
Shearman & Sterling, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or
at such other place as shall be agreed upon by ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. and the
Company and the Selling Stockholders, at 10:00 A.M. (Eastern time) the third
(fourth, if the pricing occurs after 4:30 P.M. (Eastern time) on any given day)
business day after the date hereof (unless postponed in accordance with the
provisions of Section 10), or such other time not later than ten business days
after such date as shall be agreed upon by ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. and the Company
and the Selling Stockholders (such time and date of payment and delivery being
herein called "Closing Time").
In addition, in the event that any or all of the Option Securities are
purchased by the Underwriters, payment of the purchase price for, and delivery
of certificates for, such Option Securities shall be made at the above-mentioned
offices, or at such other place as shall be agreed upon by ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
and the Company, on each Date of Delivery as specified in the notice from
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. to the Company.
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Payment shall be made to the Company and Selling Stockholders by wire
transfer of immediately available funds to bank accounts designated by the
Company and Selling Stockholders against delivery to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. for the
respective accounts of the Underwriters of certificates for the Securities to be
purchased by them. It is understood that each Underwriter has authorized ▇▇▇▇▇▇▇
▇▇▇▇▇ & Co., for its account, to accept delivery of, receipt for, and make
payment of the purchase price for, the Initial Securities and the Option
Securities, if any, which it has agreed to purchase. ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.,
individually and not as representative of the Underwriters, may (but shall not
be obligated to) make payment of the purchase price for the Initial Securities
or the Option Securities, if any, to be purchased by any Underwriter whose funds
have not been received by the Closing Time or the relevant Date of Delivery, as
the case may be, but such payment shall not relieve such Underwriter from its
obligations hereunder.
(d) Denominations; Registration. Certificates for the Initial
Securities and the Option Securities, if any, shall be in such denominations and
registered in such names as ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. may request in writing at least
one full business day before the Closing Time or the relevant Date of Delivery,
as the case may be. The certificates for the Initial Securities and the Option
Securities, if any, will be made available for examination and packaging by
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. in The City of San Francisco not later than 10:00 A.M.
(Eastern time) on the business day prior to the Closing Time or the relevant
Date of Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company covenants with each
Underwriter as follows:
(a) Compliance with Securities Regulations and Commission
Requests. The Company, subject to Section 3(b), will comply with the
requirements of Rule 430A or Rule 434, as applicable, and will notify
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. immediately, and confirm the notice in writing, (i)
when any post-effective amendment to the Registration Statement shall
become effective, or any supplement to the Prospectus or any amended
Prospectus shall have been filed, (ii) of the receipt of any comments
from the Commission, (iii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement
to the Prospectus or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing
or suspending the use of any preliminary prospectus, or of the
suspension of the qualification of the Securities for offering or sale
in any jurisdiction, or of the initiation or threatening of any
proceedings for any of such purposes. The Company will promptly effect
the filings necessary pursuant to Rule 424(b) and will take such steps
as it deems necessary to ascertain promptly whether the form of
prospectus transmitted for filing under Rule 424(b) was received for
filing by the Commission and, in the event that it was not, it will
promptly file such prospectus. The Company will make every reasonable
effort to prevent the issuance of any stop order and, if any stop order
is issued, to obtain the lifting thereof at the earliest possible
moment.
(b) Filing of Amendments. The Company will give ▇▇▇▇▇▇▇ ▇▇▇▇▇
& Co. notice of its intention to file or prepare any amendment to the
Registration Statement (including any filing under Rule 462(b)), any
Term Sheet or any amendment, supplement
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or revision to either the prospectus included in the Registration
Statement at the time it became effective or to the Prospectus, whether
pursuant to the 1933 Act, the 1934 Act or otherwise, will ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. with copies of any such documents a reasonable
amount of time prior to such proposed filing or use, as the case may
be, and will not file or use any such document to which ▇▇▇▇▇▇▇ ▇▇▇▇▇ &
Co. or counsel for the Underwriters shall object.
(c) Delivery of Registration Statements. The Company has
furnished or will deliver to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. and counsel for the
Underwriters, without charge, signed copies of the Registration
Statement as originally filed and of each amendment thereto (including
exhibits filed therewith or incorporated by reference therein and
documents incorporated or deemed to be incorporated by reference
therein) and signed copies of all consents and certificates of experts,
and will also deliver to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., without charge, a
conformed copy of the Registration Statement as originally filed and of
each amendment thereto (without exhibits) for each of the Underwriters.
The copies of the Registration Statement and each amendment thereto
furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇,
except to the extent permitted by Regulation S-T.
(d) Delivery of Prospectus. The Company has delivered to each
Underwriter, without charge, as many copies of each preliminary
prospectus as such Underwriter reasonably requested, and the Company
hereby consents to the use of such copies for purposes permitted by the
1933 Act. The Company will furnish to each Underwriter, without charge,
during the period when the Prospectus is required to be delivered under
the 1933 Act or the 1934 Act, such number of copies of the Prospectus
(as amended or supplemented) as such Underwriter may reasonably
request. The Prospectus and any amendments or supplements thereto
furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to ▇▇▇▇▇,
except to the extent permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company
will comply with the 1933 Act and the 1933 Act Regulations and the 1934
Act and the 1934 Act Regulations so as to permit the completion of the
distribution of the Securities as contemplated in this Agreement and in
the Prospectus. If at any time when a prospectus is required by the
1933 Act to be delivered in connection with sales of the Securities,
any event shall occur or condition shall exist as a result of which it
is necessary, in the opinion of counsel for the Underwriters or for the
Company, to amend the Registration Statement or amend or supplement any
Prospectus in order that the Prospectus will not include any untrue
statements of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in the
light of the circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the opinion of such counsel,
at any such time to amend the Registration Statement or amend or
supplement any Prospectus in order to comply with the requirements of
the 1933 Act or the 1933 Act Regulations, the Company will promptly
prepare and file with the Commission, subject to Section 3(b), such
amendment or supplement as may be necessary to correct such statement
or omission or to make the Registration Statement or the Prospectus
comply with such requirements, and the Company will furnish to the
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Underwriters such number of copies of such amendment or supplement as
the Underwriters may reasonably request.
(f) Blue Sky Qualifications. The Company will use its best
efforts, in cooperation with the Underwriters, to qualify the
Securities for offering and sale under the applicable securities laws
of such states and other jurisdictions (domestic or foreign) as ▇▇▇▇▇▇▇
▇▇▇▇▇ & Co. may designate and to maintain such qualifications in effect
for a period of not less than one year from the later of the effective
date of the Registration Statement and any Rule 462(b) Registration
Statement; provided, however, that the Company shall not be obligated
to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in
which it is not so qualified or to subject itself to taxation in
respect of doing business in any jurisdiction in which it is not
otherwise so subject. In each jurisdiction in which the Securities have
been so qualified, the Company will file such statements and reports as
may be required by the laws of such jurisdiction to continue such
qualification in effect for a period of not less than one year from the
effective date of the Registration Statement and any Rule 462(b)
Registration Statement.
(g) Rule 158. The Company will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally
available to its securityholders as soon as practicable an earnings
statement for the purposes of, and to provide the benefits contemplated
by, the last paragraph of Section 11(a) of the 1933 Act.
(h) Listing. The Company will use its best efforts to maintain
the quotation of the Securities on the Nasdaq National Market and will
file with the Nasdaq National Market all documents and notices required
by the Nasdaq National Market of companies that have securities that
are traded in the over-the-counter market and quotations for which are
reported by the Nasdaq National Market.
(i) Restriction on Sale of Securities. During a period of 90
days from the date of the Prospectus, the Company will not, without the
prior written consent of ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., (i) directly or
indirectly, offer, pledge, sell, contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant
any option, right or warrant to purchase or otherwise transfer or
dispose of any share of Common Stock or any securities convertible into
or exercisable or exchangeable for Common Stock or file any
registration statement under the 1933 Act with respect to any of the
foregoing or (ii) enter into any swap or any other agreement or any
transaction that transfers, in whole or in part, directly or
indirectly, the economic consequence of ownership of the Common Stock,
whether any such swap or transaction described in clause (i) or (ii)
above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. The foregoing sentence shall not
apply to (A) the Securities to be sold hereunder, (B) any shares of
Common Stock issued by the Company upon the exercise of an option or
warrant or the conversion of a security outstanding on the date hereof
and referred to in the Prospectus or (C) any shares of Common Stock
issued or options to purchase Common Stock granted pursuant to existing
employee benefit plans of the Company referred to or incorporated by
reference in the Prospectus.
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(j) Reporting Requirements. The Company, during the period
when the Prospectus is required to be delivered under the 1933 Act or
the 1934 Act, will file all documents required to be filed with the
Commission pursuant to the 1934 Act within the time periods required by
the 1934 Act and the 1934 Act Regulations.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company and the Selling Stockholders will pay or
cause to be paid all expenses incident to the performance of their obligations
under this Agreement, including (i) the preparation, printing and filing of the
Registration Statement (including financial statements and exhibits) as
originally filed and of each amendment thereto, (ii) the preparation and
delivery to the Underwriters of this Agreement, any agreement among Underwriters
and such other documents as may be required in connection with the offering,
purchase, sale or delivery of the Securities, (iii) the preparation and delivery
of the certificates for the Securities to the Underwriters, including any stock
or other transfer taxes and any stamp or other duties payable upon the sale or
delivery of the Securities to the Underwriters, and the transfer of the
Securities between the Underwriters, (iv) the fees and disbursements of the
Company's counsel, accountants and other advisors, (v) the qualification of the
Securities under securities laws in accordance with the provisions of Section
3(f) hereof, including filing fees and the reasonable fees and disbursements of
counsel for the Underwriters in connection therewith and in connection with the
preparation of the Blue Sky Survey and any supplement thereto provided that such
fees of counsel shall in no event exceed $5,000.00, (vi) the printing and
delivery to the Underwriters of copies of each preliminary prospectus, any Term
Sheets and of the Prospectus and any amendments or supplements thereto, (vii)
the preparation and delivery to the Underwriters of copies of the Blue Sky
Survey and any supplement thereto, (viii) the fees and expenses of any transfer
agent or registrar for the Securities, (ix) the filing fees incident to, and the
reasonable fees and disbursements of counsel to the Underwriters in connection
with, the review by the National Association of Securities Dealers, Inc. (the
"NASD") of the terms of the sale of the Securities provided that such fees of
counsel shall in no event exceed $15,000.00, (x) the fees and expenses incurred
in connection with the inclusion of the Securities in the Nasdaq National Market
and (xi) 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 Securities, 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 in connection with the road
show.
(b) Expenses of the Selling Stockholders. Each Selling Stockholder will
pay all expenses incident to the performance of its obligations under, and the
consummation of the transactions contemplated by this Agreement, including (i)
any stamp duties, capital duties and stock transfer taxes, if any, payable upon
the sale of the Securities to the Underwriters, and their transfer between the
Underwriters pursuant to an agreement between such Underwriters and (ii) the
fees and disbursements of its counsel and accountants.
(c) Termination of Agreement. If this Agreement is terminated by
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the Company and
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the Selling Stockholders shall reimburse the Underwriters for all of their
out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the Underwriters.
(d) Allocation of Expenses. The provisions of this Section shall not
affect any agreement that the Company and the Selling Stockholders may make for
the sharing of such costs and expenses.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of
the several Underwriters hereunder are subject to the accuracy of the
representations and warranties of the Company and the Selling Stockholders
contained in Section 1 hereof or in certificates of any officer of the Company
or any subsidiary of the Company or on behalf of the Selling Stockholders
delivered pursuant to the provisions hereof, to the performance by the Company
of its covenants and other obligations hereunder, and to the following further
conditions:
(a) Effectiveness of Registration Statement. The Registration
Statement, including any Rule 462(b) Registration Statement, has become
effective and at Closing Time no stop order suspending the
effectiveness of the Registration Statement shall have been issued
under the 1933 Act or proceedings therefor initiated or threatened by
the Commission, and any request on the part of the Commission for
additional information shall have been complied with to the reasonable
satisfaction of counsel to the Underwriters. A prospectus containing
the Rule 430A Information shall have been filed with the Commission in
accordance with Rule 424(b) (or a post-effective amendment providing
such information shall have been filed and declared effective in
accordance with the requirements of Rule 430A) or, if the Company has
elected to rely upon Rule 434, a Term Sheet shall have been filed with
the Commission in accordance with Rule 424(b).
(b) Opinion of Counsel for Company. At Closing Time, ▇▇▇▇▇▇▇
▇▇▇▇▇ & Co. shall have received the favorable opinion, dated as of
Closing Time, of Akin, Gump, Strauss, ▇▇▇▇▇ & ▇▇▇▇, L.L.P., counsel for
the Company, in form and substance satisfactory to counsel for the
Underwriters, together with signed or reproduced copies of such letter
for each of the other Underwriters to the effect set forth in Exhibit A
hereto and to such further effect as counsel to the Underwriters may
reasonably request.
(c) Opinion of Special Regulatory Counsel for Company. At
Closing Time, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have received the favorable
opinion, dated as of Closing Time, of ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇, special
regulatory counsel for the Company, in form and substance satisfactory
to counsel for the Underwriters, together with signed or reproduced
copies of such letter for each of the other Underwriters to the effect
set forth in Exhibit B hereto and to such further effect as counsel to
the Underwriters may reasonably request.
(d) Opinion of Counsel for JLL. At Closing Time, ▇▇▇▇▇▇▇ ▇▇▇▇▇
& Co. shall have received the favorable opinion, dated as of Closing
Time, of Debevoise & ▇▇▇▇▇▇▇▇, counsel for JLL, in form and substance
satisfactory to counsel for the Underwriters, together with signed or
reproduced copies of such letter for each of the other
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Underwriters to the effect set forth in Exhibit C hereto and to such
further effect as counsel to the Underwriters may reasonably request.
(e) Opinion of Counsel for ▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇. At
Closing Time, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have received the favorable
opinion, dated as of Closing Time, of Akin, Gump, Strauss, ▇▇▇▇▇ &
▇▇▇▇, L.L.P., counsel for ▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇, in form and
substance satisfactory to counsel for the Underwriters, together with
signed or reproduced copies of such letter for each of the other
Underwriters to the effect set forth in Exhibit D hereto and to such
further effect as counsel to the Underwriters may reasonably request.
(f) Opinion of Counsel for Underwriters. At Closing Time,
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have received the favorable opinion, dated as
of Closing Time, of Shearman & Sterling, counsel for the Underwriters,
in form and substance satisfactory to the Underwriters, together with
signed or reproduced copies of such letter for each of the other
Underwriters. In giving such opinion such counsel may rely, as to all
matters governed by the laws of jurisdictions other than the law of the
State of
New York, the federal law of the United States and the General
Corporation Law of the State of Delaware, upon the opinions of counsel
satisfactory to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. Such counsel may also state that,
insofar as such opinion involves factual matters, they have relied, to
the extent they deem proper, upon certificates of officers of the
Company and its subsidiaries and certificates of public officials.
(g) Opinion of In-House Counsel. At Closing Time, ▇▇▇▇▇▇▇
▇▇▇▇▇ & Co. shall have received the favorable opinion, dated as of
Closing Time, of ▇▇▇▇▇ de Mars, General Counsel for the Company, in
form and substance satisfactory to counsel for the Underwriters,
together with signed or reproduced copies of such letter for each of
the other Underwriters to the effect set forth in Exhibit E hereto and
to such further effect as counsel to the Underwriters may reasonably
request.
(h) Opinion of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇. At Closing Time, ▇▇▇▇▇▇▇
▇▇▇▇▇ & Co. shall have received the favorable opinion, dated as of
Closing Time, of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Senior Vice President, Corporate
Affairs and Secretary of the Company in form and substance satisfactory
to counsel for the Underwriters, together with signed or reproduced
copies of such letter for each of the other Underwriters to the effect
set forth in Exhibit F hereto and to such further effect as counsel to
the Underwriters may reasonably request.
(i) Officers' Certificate. At Closing Time, there shall not
have been, since the date hereof or since the respective dates as of
which information is given in the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in
the ordinary course of business, and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have
received a certificate of the Chief Executive Officer or a Vice
President of the Company and of the chief financial or chief accounting
officer of the Company, dated as of Closing Time, to the effect that
(i) there has been no such material adverse change, (ii) the
representations and warranties in Section 1(a) hereof are true and
correct with the same force and effect as though expressly made at and
as of
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Closing Time, (iii) the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at or
prior to Closing Time, and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are pending or, to
the best knowledge of the officers signing the certificate, after due
inquiry, are contemplated by the Commission.
(j) Certificate of Selling Stockholders. At Closing Time,
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have received a certificate of each Selling
Stockholder, dated as of Closing Time, to the effect that (i) the
representations and warranties of such Selling Stockholder contained in
Section 1(b) hereof are true and correct in all respects with the same
force and effect as though expressly made at and as of Closing Time and
(ii) such Selling Stockholder has complied in all material respects
with all agreements and all conditions on its part to be performed
under this Agreement at or prior to Closing Time.
(k) Comfort Letter of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP. At the time of the
execution of this Agreement, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have received
from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ a letter dated such date, in form and substance
satisfactory to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., together with signed or reproduced
copies of such letter for each of the other Underwriters containing
statements and information of the type ordinarily included in
accountants' "comfort letters" to underwriters with respect to the
financial statements of the Company and certain financial information
contained in the Registration Statement and the Prospectuses.
(l) Bring-Down Comfort Letter of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP. At
Closing Time, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have received from ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ LLP a letter, dated as of Closing Time, to the effect that
they reaffirm the statements made in the letter furnished pursuant to
subsection (k) of this Section, except that the specified date referred
to shall be a date not more than three business days prior to Closing
Time.
(m) Comfort Letter of Ernst & Young LLP. At the time of the
execution of this Agreement, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have received
from Ernst & Young LLP a letter dated such date, in form and substance
satisfactory to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., together with signed or reproduced
copies of such letter for each of the other Underwriters containing
statements and information of the type ordinarily included in
accountants' "comfort letters" to underwriters with respect to the
financial statements of PCS and certain financial information contained
in the Registration Statement and the Prospectuses.
(n) Bring-down Comfort Letter of Ernst & Young LLP. At Closing
Time, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have received from Ernst & Young LLP a
letter, dated as of Closing Time, to the effect that they reaffirm the
statements made in the letter furnished pursuant to subsection (m) of
this Section, except that the specified date referred to shall be a
date not more than three business days prior to Closing Time.
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(o) Approval of Listing. At Closing Time, the Securities shall
have been approved for inclusion in the Nasdaq National Market, subject
only to official notice of issuance.
(p) No Objection. The NASD has confirmed that it has not
raised any objection with respect to the fairness and reasonableness of
the underwriting terms and arrangements.
(q) Conditions to Purchase of Option Securities. In the event
that the Underwriters exercise their option provided in Section 2(b)
hereof to purchase all or any portion of the Option Securities, the
representations and warranties of the Company contained herein and the
statements in any certificates furnished by the Company or any
subsidiary of the Company hereunder shall be true and correct as of
each Date of Delivery and:
(i) Officers' Certificate. At the relevant Date of
Delivery, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have received a
certificate, dated such Date of Delivery, of the Chief
Executive Officer or a Vice President of the Company and of
the chief financial or chief accounting officer of the Company
confirming that the certificate delivered at the Closing Time
pursuant to Section 5(h) hereof remains true and correct as of
such Date of Delivery.
(ii) Opinions of Counsel for Company. At the relevant
Date of Delivery, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have received the
favorable opinion of Akin, Gump, Strauss, ▇▇▇▇▇ & ▇▇▇▇,
L.L.P., counsel for the Company, together with the favorable
opinion of ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇, special regulatory
counsel for the Company, each in form and substance
satisfactory to counsel for the Underwriters, dated such Date
of Delivery, relating to the Option Securities to be purchased
on such Date of Delivery and otherwise to the same effect as
the opinion required by Sections 5(b) and (c) hereof.
(iii) Opinion of Counsel for Underwriters. At the
relevant Date of Delivery, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have
received the favorable opinion of Shearman & Sterling, counsel
for the Underwriters, dated such Date of Delivery, relating to
the Option Securities to be purchased on such Date of Delivery
and otherwise to the same effect as the opinion required by
Section 5(f) hereof.
(iv) Bring-down Comfort Letter of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
LLP. At the relevant Date of Delivery, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
shall have received a letter from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, in form
and substance satisfactory to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. and dated
such Date of Delivery, substantially in the same form and
substance as the letter furnished to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
pursuant to Section 5(k) hereof, except that the "specified
date" in the letter furnished pursuant to this paragraph shall
be a date not more than five days prior to such Date of
Delivery.
(v) Bring-down Comfort Letter of Ernst & Young LLP.
At the relevant Date of Delivery, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall
have received a letter from
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Ernst & Young LLP, in form and substance satisfactory to
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. and dated such Date of Delivery,
substantially in the same form and substance as the letter
furnished to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. pursuant to Section 5(m)
hereof, except that the "specified date" in the letter
furnished pursuant to this paragraph shall be a date not more
than five days prior to such Date of Delivery.
(vi) Opinion of In-House Counsel. At the relevant
Date of Delivery, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have received the
favorable opinion of ▇▇▇▇▇ de Mars, General Counsel of the
Company, in form and substance satisfactory to counsel for the
Underwriters, dated such Date of Delivery, relating to the
Option Securities to be purchased on such Date of Delivery and
otherwise to the same effect as the opinion required by
Section 5(g) hereof.
(vii) Opinion of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇. At the relevant
Date of Delivery, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have received the
favorable opinion of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Senior Vice President,
Corporate Affairs and Secretary of the Company, in form and
substance satisfactory to counsel for the Underwriters, dated
such Date of Delivery, relating to the Option Securities to be
purchased on such Date of Delivery and otherwise to the same
effect as the opinion required by Section 5(h) hereof.
(r) Additional Documents. At Closing Time and at each Date of
Delivery, counsel for the Underwriters shall have been furnished with
such documents and opinions as they may reasonably require for the
purpose of enabling them to pass upon the sale of the Securities as
herein contemplated, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Company
and the Selling Stockholders in connection with the sale of the
Securities as herein contemplated shall be satisfactory in form and
substance to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. and counsel for the Underwriters.
(s) Termination of Agreement. If any condition specified in
this Section shall not have been fulfilled when and as required to be
fulfilled, this Agreement, or, in the case of any condition to the
purchase of Option Securities, on a Date of Delivery which is after the
Closing Time, the obligations of the several Underwriters to purchase
the relevant Option Securities, may be terminated by ▇▇▇▇▇▇▇ ▇▇▇▇▇ &
Co. by notice to the Company and the Selling Stockholders at any time
at or prior to Closing Time or such Date of Delivery, as the case may
be, and such termination shall be without liability of any party to any
other party except as provided in Section 4 and except that Sections 1,
6, 7 and 8 shall survive any such termination and remain in full force
and effect.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. The Company agrees to indemnify
and hold harmless each Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act as follows:
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(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
430A Information and the Rule 434 Information, if applicable, or the
omission or alleged omission therefrom of a material fact required to
be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact included in any preliminary prospectus or
the Prospectus (or any amendment or supplement thereto), or the
omission or alleged omission therefrom of a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission; provided
that (subject to Section 6(e) below) any such settlement is effected
with the written consent of the Company and the Selling Stockholders;
and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by ▇▇▇▇▇▇▇
▇▇▇▇▇ & Co.) reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission to the extent that any such
expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by any
Underwriter through ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
the Rule 434 Information, if applicable, or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto). The foregoing indemnity
with respect to any untrue statement contained in or omission from a preliminary
prospectus shall not inure to the benefit of any Underwriter (or any person
controlling such Underwriter) from whom the person asserting any such loss,
liability, claim, damage or expense purchased any of the Securities which are
the subject thereof if the Company or the Selling Stockholders shall sustain the
burden of proving that such person was not sent or given a copy of the
Prospectus (or the Prospectus as amended or supplemented) at or prior to the
written confirmation of the sale of such Securities to such person and the
untrue statement contained in or omission from such preliminary prospectus was
corrected in the Prospectus (or the Prospectus as amended or supplemented).
(b) Indemnification of the Underwriters by the Selling Stockholders.
Each Selling Stockholder severally and not jointly agrees to indemnify and hold
harmless each Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act,
against any and all loss, liability, claim, damage and
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expense described in the indemnity contained in subsection (a) of this Section,
as incurred, but only with reference to information furnished by or on behalf of
such Selling Stockholder expressly for use in the Registration Statement (or any
amendment thereto), any preliminary prospectus or Prospectus (or any amendment
or supplement thereto); provided, however, that the aggregate liability of each
Selling Stockholder under this subsection (b) shall not exceed the product of
the number of Securities sold by such Selling Stockholder and the offering price
of the Securities as set forth in the Prospectus.
(c) Indemnification of Company, Directors and Officers and Selling
Stockholders. Each Underwriter severally agrees to indemnify and hold harmless
the Company, its directors, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act, and each Selling
Stockholder and each person, if any, who controls a Selling Stockholder within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act against
any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) and subsection (b) of this Section, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendment thereto), including the Rule 430A Information and the Rule 434
Information, if applicable, or any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Company by such Underwriter through ▇▇▇▇▇▇▇
▇▇▇▇▇ & Co. expressly for use in the Registration Statement (or any amendment
thereto) or such preliminary prospectus or the Prospectus (or any amendment or
supplement thereto).
(d) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) and
Section 6(b) above, counsel to the indemnified parties shall be selected by
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., and, in the case of parties indemnified pursuant to Section
6(c) above, counsel to the indemnified parties shall be selected by the Company
and the Selling Stockholders. An indemnifying party may participate at its own
expense in the defense of any such action; provided, however, that counsel to
the indemnifying party shall not (except with the consent of the indemnified
party) also be counsel to the indemnified party. In no event shall the
indemnifying parties be liable for fees and expenses of more than one counsel
(in addition to any local counsel) separate from their own counsel for all
indemnified parties in connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any litigation, or any investigation
or proceeding by any governmental agency or body, commenced or threatened, or
any claim whatsoever in respect of which indemnification or contribution could
be sought under this Section 6 or Section 7 hereof (whether or not the
indemnified parties are actual or potential parties thereto), unless such
settlement, compromise or consent (i) includes an unconditional release of each
indemnified party from all liability arising out of such litigation,
investigation,
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proceeding or claim and (ii) does not include a statement as to or an admission
of fault, culpability or a failure to act by or on behalf of any indemnified
party.
(e) Settlement without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement other than reimbursement for fees and expenses that the indemnifying
party is contesting in good faith.
(f) Other Agreements with Respect to Indemnification. The provisions of
this Section shall not affect any agreement among the Company and the Selling
Stockholders with respect to indemnification.
SECTION 7. Contribution. If the indemnification provided for in Section
6 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Selling Stockholders on the one hand and the Underwriters on the other hand from
the offering of the Securities pursuant to this Agreement or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company and the
Selling Stockholders on the one hand and of the Underwriters on the other hand
in connection with the statements or omissions which resulted in such losses,
liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company and the Selling
Stockholders on the one hand and the Underwriters on the other hand in
connection with the offering of the Securities pursuant to this Agreement shall
be deemed to be in the same respective proportions as the total net proceeds
from the offering of the Securities pursuant to this Agreement (before deducting
expenses) received by the Company and the Selling Stockholders and the total
underwriting discount received by the Underwriters, in each case as set forth on
the cover of the Prospectus, or, if Rule 434 is used, the corresponding location
on the Term Sheet, bear to the aggregate initial public offering price of the
Securities as set forth on such cover.
The relative fault of the Company and the Selling Stockholders on the
one hand and the Underwriters on the other hand shall be determined by reference
to, among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or the Selling Stockholders or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
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The Company, the Selling Stockholders and the Underwriters agree that
it would not be just and 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 which does not
take account of the equitable considerations referred to above in this Section
7. The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an indemnified party and referred to above in this Section 7 shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls a
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the Company, each officer of the Company who signed the
Registration Statement, and each person, if any, who controls the Company or the
Selling Stockholders within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Company or
the Selling Stockholders, as the case may be. The Underwriters' respective
obligations to contribute pursuant to this Section 7 are several in proportion
to the number of Initial Securities set forth opposite their respective names in
Schedule A hereto and not joint.
The provisions of this Section shall not affect any agreement between
the Company and the Selling Stockholders with respect to contribution. In no
event shall the Selling Stockholders be required to contribute an amount in
excess of that which it would have been required to pay to indemnify under
Section 6(b) if such indemnification were then available.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or Selling Stockholders
submitted pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Company or the Selling
Stockholders, and shall survive delivery of the Securities to the Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. may terminate this
Agreement, by written notice to the Company and the Selling Stockholders, at any
time at or prior to Closing
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Time (i) if there has been, since the time of execution of this Agreement or
since the respective dates as of which information is given in the Prospectus,
any material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, (ii) if there has occurred any outbreak of
hostilities or escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or international
political, financial or economic conditions, in each case the effect of which is
such as to make it, in the judgment of ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., impracticable to
market the Securities or to enforce contracts for the sale of the Securities,
(iii) if trading in any securities of the Company has been suspended or
materially limited by the Commission or the Nasdaq National Market, or if
trading generally on the American Stock Exchange or the
New York Stock Exchange
or in the Nasdaq National Market has been suspended or materially limited, or
minimum or maximum prices for trading have been fixed, or maximum ranges for
prices have been required, by any of said exchanges or by such system or by
order of the Commission, the National Association of Securities Dealers, Inc. or
any other governmental authority, or (iv) if a banking moratorium has been
declared by Federal,
New York or Texas authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7 and 8 shall survive such termination and remain in full force and
effect.
SECTION 10. Default by One or More of the Underwriters. If one or more
of the Underwriters shall fail at Closing Time or a Date of Delivery to purchase
the Securities which it or they are obligated to purchase under this Agreement
(the "Defaulted Securities"), ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall have the right, within
24 hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. shall not have
completed such arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10%
of the number of Securities to be purchased on such date, each of the
non-defaulting Underwriters shall be obligated, severally and not
jointly, to purchase the full amount thereof in the proportions that
their respective underwriting obligations hereunder bear to the
underwriting obligations of all non-defaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the
number of Securities to be purchased on such date, this Agreement or,
with respect to any Date of Delivery which occurs after the Closing
Time, the obligation of the Underwriters to purchase and of the Company
to sell the Option Securities to be purchased and sold on such Date of
Delivery shall terminate without liability on the part of any
non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
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In the event of any such default which does not result in a termination
of this Agreement or, in the case of a Date of Delivery which is after the
Closing Time, which does not result in a termination of the obligation of the
Underwriters to purchase and the Company to sell the relevant Option Securities,
as the case may be, either ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. or any Selling Stockholders shall
have the right to postpone Closing Time or the relevant Date of Delivery, as the
case may be, for a period not exceeding seven days in order to effect any
required changes in the Registration Statement or Prospectus or in any other
documents or arrangements. As used herein, the term "Underwriter" includes any
person substituted for a Underwriter under this Section 10.
SECTION 11. Default by One or More of the Selling Stockholders or the
Company.
(a) If a Selling Stockholder shall fail at Closing Time or at a Date of
Delivery to sell and deliver the number of Securities which such Selling
Stockholder or Selling Stockholders are obligated to sell hereunder, and the
remaining Selling Stockholders do not exercise the right hereby granted to
increase, pro rata or otherwise, the number of Securities to be sold by them
hereunder to the total number to be sold by all Selling Stockholders as set
forth in Schedule B hereto, then the Underwriters may, at the option of ▇▇▇▇▇▇▇
▇▇▇▇▇ & Co., by notice from ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. to the Company and the
non-defaulting Selling Stockholders, either (i) terminate this Agreement without
any liability on the part of any non-defaulting party except that the provisions
of 1, 4, 6, 7 and 8 shall remain in full force and effect or (ii) elect to
purchase the Securities which the non-defaulting Selling Stockholders and the
Company have agreed to sell hereunder. No action taken pursuant to this Section
11 shall relieve any Selling Stockholder so defaulting from liability, if any,
in respect to such default.
In the event of a default by any Selling Stockholder as referred to in
this Section 11, each of ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., the Company and the non-defaulting
Selling Stockholders shall have the right to postpone Closing Time or Date of
Delivery for a period not exceeding seven days in order to effect any required
change in the Registration Statement or Prospectus or in any other documents or
arrangements.
(b) If the Company shall fail at Closing Time or at the Date of
Delivery to sell the number of Securities that it is obligated to sell
hereunder, then this Agreement shall terminate without any liability on the part
of any non-defaulting party; provided, however, that the provisions of Sections
1, 4, 6, 7 and 8 shall remain in full force and effect. No action taken pursuant
to this Section shall relieve the Company from liability, if any, in respect of
such default.
SECTION 12. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. at North Tower, World
Financial center, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ attention of Legal Department;
and notices to the Company, ▇▇▇▇▇ ▇▇▇▇▇▇▇ or ▇▇▇ ▇▇▇▇▇▇▇ shall be directed to
such party at ▇▇▇▇ ▇▇▇▇▇ ▇'▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
attention of Legal Department; and notices to JLL shall be directed to it at ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, attention of ▇▇▇▇▇▇ ▇▇▇▇▇.
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SECTION 13. Parties. This Agreement shall each inure to the benefit of
and be binding upon the Underwriters, the Company, the Selling Stockholders and
their respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Underwriters, the Company, the Selling Stockholders and their
respective successors and the controlling persons and officers and directors
referred to in Sections 6 and 7 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
Underwriters, the Company, the Selling Stockholders and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Securities from any Underwriter shall be deemed to
be a successor by reason merely of such purchase.
SECTION 14. Governing Law and Time. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK. SPECIFIED
TIMES OF DAY REFER TO
NEW YORK CITY TIME.
SECTION 15. Effect of Headings. The Article and Section headings herein
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company and the Selling Stockholders a
counterpart hereof, whereupon this instrument, along with all counterparts, will
become a binding agreement among the Underwriters, the Company and the Selling
Stockholders in accordance with its terms.
Very truly yours,
ADVANCEPCS
By: /s/
ADVANCEPCS
---------------------------------------
Name:
Title:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ &
LEVY FUND III, L.P.
By: JLL Associates III, L.L.C.
as general partner
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------------------
Name:
Title:
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------------
▇▇▇ ▇. ▇▇▇▇▇▇▇
36
CONFIRMED AND ACCEPTED,
as of the date first above written:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By: ▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By /s/
------------------------------------------
Authorized Signatory
37
SCHEDULE A
Number of Maximum Number
Initial of Option Securities
Name of Underwriter Securities to be Sold
------------------- ------------ --------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co. 5,151,249 500,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
Total ........................................ 5,151,249 500,000
------------ ------------
38
SCHEDULE B
Number of Initial
Securities to be Sold
---------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ Levy Fund III, L.P. 751,249
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ 200,000
▇▇▇ ▇. ▇▇▇▇▇▇▇ 200,000
------------
TOTAL 1,151,249
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SCHEDULE C
ADVANCEPCS
5,151,249 Shares of Common Stock
(Par Value $.01 Per Share)
1. The public offering price per share for the Securities, determined
as provided in said Section 2, shall be $65.75.
2. The purchase price per share for the Securities to be paid by the
several Underwriters shall be $64.75, being an amount equal to the public
offering price set forth above less $1.00 per share; provided that the purchase
price per share for any Option Securities purchased upon the exercise of the
over-allotment option described in Section 2(b) shall be reduced by an amount
per share equal to any dividends or distributions declared by the Company and
payable on the Initial Securities but not payable on the Option Securities.
40
SCHEDULE D
AdvancePCS Health, L.P.
AdvancePCS Health Systems, LLC
AdvancePCS Holding Corporation
AdvancePCS Mail Services of Birmingham, Inc.
AdvancePCS Puerto Rico, Inc.
AdvancePCS Research, L.L.C.
AdvancePCS SpecialtyRx, LLC
▇▇▇▇▇▇▇▇▇.▇▇▇, L.P.
ADVP Consolidation L.L.C.
ADVP Management, L.P.
Ambulatory Care Review Services, Inc.
▇▇▇▇▇▇-▇▇▇▇▇▇ Neuromedical Institute, Inc.
▇▇▇▇▇▇▇-▇▇▇▇▇▇▇, Inc.
FFI Rx Managed Care, Inc.
First Florida International Holdings, Inc.
HMN Health Services, Inc.
TheraCom, Inc.