Exhibit 1.1
Execution
Version
Surgery Partners, Inc.
8,625,000 Shares of Common Stock
Underwriting Agreement
January 27, 2021
X.X. Xxxxxx Securities LLC
Xxxxxxxxx LLC
As Representatives of the
several Underwriters listed
in
Schedule 1 hereto
c/o X.X. Xxxxxx Securities LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
c/x Xxxxxxxxx LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Surgery Partners, Inc., a Delaware
corporation (the “Company”), proposes to issue and sell to the several underwriters listed in Schedule 1 hereto (the
“Underwriters”), for whom you are acting as representatives (the “Representatives”), an aggregate of 7,500,000
shares of common stock, par value $ 0.01 per share, of the Company (the “Underwritten Shares”) and, at the option of
the Underwriters, up to an additional 1,125,000 shares of common stock of the Company (the “Option Shares”). The Underwritten
Shares and the Option Shares are herein referred to as the “Shares”. The shares of common stock of the Company to be
outstanding after giving effect to the sale of the Shares are referred to herein as the “Stock”.
The Company hereby confirms its agreement
with the several Underwriters concerning the purchase and sale of the Shares, as follows:
1. Registration
Statement. The Company has prepared and filed with the Securities and Exchange Commission (the “Commission”) under
the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Securities
Act”), a registration statement (File No. 333-252399), including a prospectus, relating to the Shares. Such registration
statement, as amended at the time it became effective, including the information, if any, deemed pursuant to Rule 430A, 430B
or 430C under the Securities Act to be part of the registration statement at the time of its effectiveness (“Rule 430
Information”), is referred to herein as the “Registration Statement”; and as used herein, the term “Preliminary
Prospectus” means each prospectus included in such registration statement (and any amendments thereto) before effectiveness,
any prospectus filed with the Commission pursuant to Rule 424(a) under the Securities Act and the prospectus included
in the Registration Statement at the time of its effectiveness that omits Rule 430 Information, and the term “Prospectus”
means the prospectus in the form first used (or made available upon request of purchasers pursuant to Rule 173 under the Securities
Act) in connection with confirmation of sales of the Shares. Any reference in this underwriting agreement (this “Agreement”)
to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the Securities Act, as of the effective date of the
Registration Statement or the date of such Preliminary Prospectus or the Prospectus, as the case may be, and any reference to “amend”,
“amendment” or “supplement” with respect to the Registration Statement, any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include any documents filed after such date under the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission thereunder (collectively, the “Exchange Act”) that
are deemed to be incorporated by reference therein. Capitalized terms used but not defined herein shall have the meanings given
to such terms in the Registration Statement and the Prospectus.
At or prior to the Applicable Time (as defined
below), the Company had prepared the following information (collectively with the pricing information set forth on Annex A, the
“Pricing Disclosure Package”): a Preliminary Prospectus dated January 25, 2021 and each “free-writing prospectus”
(as defined pursuant to Rule 405 under the Securities Act) listed on Annex A hereto.
“Applicable Time” means 6:30
P.M., New York City time, on January 27, 2021.
2. Purchase
of the Shares.
(a) The
Company agrees to issue and sell the Underwritten Shares to the several Underwriters as provided in this underwriting agreement
(this “Agreement”), and each Underwriter, on the basis of the representations, warranties and agreements set forth
herein and subject to the conditions set forth herein, agrees, severally and not jointly, to purchase at a price per share of $28.88875
(the “Purchase Price”) from the Company the respective number of Shares set forth opposite such Underwriter’s
name in Schedule 1 hereto.
In addition, the Company agrees to issue
and sell the Option Shares to the several Underwriters as provided in this Agreement, and the Underwriters, on the basis of the
representations, warranties and agreements set forth herein and subject to the conditions set forth herein, shall have the option
to purchase, severally and not jointly, from the Company the Option Shares at the Purchase Price less an amount per share equal
to any dividends or distributions declared by the Company and payable on the Underwritten Shares but not payable on the Option
Shares.
If any Option Shares are to be purchased,
the number of Option Shares to be purchased by each Underwriter shall be the number of Option Shares which bears the same ratio
to the aggregate number of Option Shares being purchased as the number of Underwritten Shares set forth opposite the name of such
Underwriter in Schedule 1 hereto (or such number increased as set forth in Section 10 hereof) bears to the aggregate number
of Underwritten Shares being purchased from the Company by the several Underwriters, subject, however, to such adjustments to eliminate
any fractional Shares as the Representatives in their sole discretion shall make.
The Underwriters may exercise the option
to purchase Option Shares at any time in whole, or from time to time in part, on or before the thirtieth day following the date
of the Prospectus, by written notice from the Representatives to the Company. Such notice shall set forth the aggregate number
of Option Shares as to which the option is being exercised and the date and time when the Option Shares are to be delivered and
paid for, which may be the same date and time as the Closing Date (as hereinafter defined) but shall not be earlier than the Closing
Date nor later than the tenth full business day (as hereinafter defined) after the date of such notice (unless such time and date
are postponed in accordance with the provisions of Section 10 hereof). Any such notice shall be given at least two business
days prior to the date and time of delivery specified therein.
(b) The
Company understands that the Underwriters intend to make a public offering of the Shares, and initially to offer the Shares on
the terms set forth in the Pricing Disclosure Package. The Company acknowledges and agrees that the Underwriters may offer and
sell Shares to or through any affiliate of an Underwriter.
(c) Payment
for the Shares shall be made by wire transfer in immediately available funds to the account specified by the Company to the Representatives
in the case of the Underwritten Shares, at the offices of Xxxxxx & Xxxxxxx LLP at 10:00 A.M. New York City time on
February 1, 2021, or at such other time or place on the same or such other date, not later than the fifth business day thereafter,
as the Representatives and the Company may agree upon in writing or, in the case of the Option Shares, on the date and at the time
and place specified by the Representatives in the written notice of the Underwriters’ election to purchase such Option Shares.
The time and date of such payment for the Underwritten Shares is referred to herein as the “Closing Date”, and the
time and date for such payment for the Option Shares, if other than the Closing Date, is herein referred to as the “Additional
Closing Date”.
Payment for the Shares to be purchased on
the Closing Date or the Additional Closing Date, as the case may be, shall be made against delivery to the Representatives for
the respective accounts of the several Underwriters of the Shares to be purchased on the Closing Date or the Additional Closing
Date, as the case may be, with any transfer taxes payable in connection with the sale of such Shares duly paid by the Company.
Delivery of the Shares shall be made through the facilities of The Depository Trust Company (“DTC”) unless the Representatives
shall otherwise instruct. The certificates for the Shares will be made available for inspection and packaging by the Representatives
at the office of DTC or its designated custodian not later than 1:00 P.M., New York City time, on the business day prior to the
Closing Date or the Additional Closing Date, as the case may be.
(d) The
Company acknowledges and agrees that the Representatives and the other Underwriters are acting solely in the capacity of an arm’s
length contractual counterparty to the Company with respect to the offering of Shares contemplated hereby (including in connection
with determining the terms of the offering) and not as a financial advisor or a fiduciary to, or an agent of, the Company or any
other person. Additionally, neither of the Representatives nor any other Underwriter is advising the Company or any other person
as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction. The Company shall consult with its own
advisors concerning such matters and shall be responsible for making its own independent investigation and appraisal of the transactions
contemplated hereby, and neither of the Representatives nor the other Underwriters shall have any responsibility or liability to
the Company with respect thereto. Any review by the Representatives and the other Underwriters of the Company, the transactions
contemplated hereby or other matters relating to such transactions will be performed solely for the benefit of the Underwriters
and shall not be on behalf of the Company.
3. Representations
and Warranties of the Company. The Company represents and warrants to each Underwriter that:
(a) Preliminary
Prospectus. No order preventing or suspending the use of any Preliminary Prospectus has been issued by the Commission, and
each Preliminary Prospectus included in the Pricing Disclosure Package, at the time of filing thereof, complied in all material
respects with the applicable requirements of the Securities Act, and no Preliminary Prospectus, at the time of filing thereof,
contained any untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading; provided that the Company makes no
representation or warranty with respect to any statements or omissions made in reliance upon and in conformity with information
relating to any Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use
in any Preliminary Prospectus, it being understood and agreed that the only such information furnished by any Underwriter consists
of the information described as such in Section 7(b) hereof.
(b) Pricing
Disclosure Package. The Pricing Disclosure Package as of the Applicable Time did not, and as of the Closing Date and as of
the Additional Closing Date, as the case may be, will not, contain any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;
provided that the Company makes no representation or warranty with respect to any statements or omissions made in reliance
upon and in conformity with information relating to any Underwriter furnished to the Company in writing by such Underwriter through
the Representatives expressly for use in such Pricing Disclosure Package, it being understood and agreed that the only such information
furnished by any Underwriter consists of the information described as such in Section 7(b) hereof. No statement of material
fact included in the Prospectus has been omitted from the Pricing Disclosure Package and no statement of material fact included
in the Pricing Disclosure Package that is required to be included in the Prospectus has been omitted therefrom.
(c) Issuer
Free Writing Prospectus. Other than the Registration Statement, the Preliminary Prospectus and the Prospectus, the Company
(including its agents and representatives, other than the Underwriters in their capacity as such) has not prepared, made, used,
authorized, approved or referred to and will not prepare, make, use, authorize, approve or refer to any “written communication”
(as defined in Rule 405 under the Securities Act) that constitutes an offer to sell or solicitation of an offer to buy the
Shares (each such communication by the Company or its agents and representatives (other than a communication referred to in clause
(i) below) an “Issuer Free Writing Prospectus”) other than (i) any document not constituting a prospectus
pursuant to Section 2(a)(10)(a) of the Securities Act or Rule 134 under the Securities Act or (ii) the documents
listed on Annex A hereto, each electronic road show and any other written communications approved in writing in advance by the
Representatives. Each such Issuer Free Writing Prospectus complies in all material respects with the Securities Act, has been
or will be (within the time period specified in Rule 433) filed in accordance with the Securities Act (to the extent required
thereby) and does not conflict with the information contained in the Registration Statement or the Pricing Disclosure Package,
and, when taken together with the Preliminary Prospectus accompanying, or delivered prior to delivery of, such Issuer Free Writing
Prospectus, did not, and as of the Closing Date and as of the Additional Closing Date, as the case may be, will not, contain any
untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; provided that the Company makes no representation
or warranty with respect to any statements or omissions made in each such Issuer Free Writing Prospectus or Preliminary Prospectus
in reliance upon and in conformity with information relating to any Underwriter furnished to the Company in writing by such Underwriter
through the Representatives expressly for use in such Issuer Free Writing Prospectus or Preliminary Prospectus, it being understood
and agreed that the only such information furnished by any Underwriter consists of the information described as such in Section 7(b) hereof.
(d) Registration
Statement and Prospectus. The Registration Statement is an “automatic shelf registration statement” as defined
under Rule 405 of the Securities Act that has been filed with the Commission not earlier than three years prior to the date
hereof; and no notice of objection of the Commission to the use of such registration statement or any post-effective amendment
thereto pursuant to Rule 401(g)(2) under the Securities Act has been received by the Company. No order suspending the
effectiveness of the Registration Statement has been issued by the Commission, and no proceeding for that purpose or pursuant to
Section 8A of the Securities Act against the Company or related to the offering of the Shares has been initiated or, to the
knowledge of the Company, threatened by the Commission; as of the applicable effective date of the Registration Statement and any
post-effective amendment thereto, the Registration Statement and any such post-effective amendment complied and will comply in
all material respects with the applicable requirements of the Securities Act, and did not and will not contain any untrue statement
of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements
therein not misleading; and as of the date of the Prospectus and any amendment or supplement thereto and as of the Closing Date
and as of the Additional Closing Date, as the case may be, the Prospectus will comply in all material respects with the applicable
requirements of the Securities Act and will not contain any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;
provided that the Company makes no representation or warranty with respect to any statements or omissions made in reliance
upon and in conformity with information relating to any Underwriter furnished to the Company in writing by such Underwriter through
the Representatives expressly for use in the Registration Statement and the Prospectus and any amendment or supplement thereto,
it being understood and agreed that the only such information furnished by any Underwriter consists of the information described
as such in Section 7(b) hereof.
(e) Incorporated
Documents. The documents incorporated by reference in the Registration Statement, the Prospectus and the Pricing Disclosure
Package, when they were filed with the Commission conformed in all material respects to the requirements of the Exchange Act, and
none of such documents contained any untrue statement of a material fact or omitted to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they were made, not misleading; and any further documents
so filed and incorporated by reference in the Registration Statement, the Prospectus or the Pricing Disclosure Package, when such
documents are filed with the Commission, will conform in all material respects to the requirements of the Exchange Act and will
not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading.
(f) Financial
Statements. The financial statements (including the related notes thereto) of the Company and its consolidated subsidiaries
included or incorporated by reference in the Registration Statement, the Pricing Disclosure Package and the Prospectus comply in
all material respects with the applicable requirements of the Securities Act and the Exchange Act, as applicable, and present fairly
in all material respects the financial position of the Company and its consolidated subsidiaries as of the dates indicated and
the results of their operations and the changes in their cash flows for the periods specified; such financial statements have been
prepared in conformity with generally accepted accounting principles (“GAAP”) in the United States applied on a consistent
basis throughout the periods covered thereby, and any supporting schedules included or incorporated by reference in the Registration
Statement present fairly in all material respects the information required to be stated therein; and the other financial information
included or incorporated by reference in the Registration Statement, the Pricing Disclosure Package and the Prospectus has been
derived from the accounting records of the Company and its consolidated subsidiaries and presents fairly in all material respects
the information shown thereby; all disclosures included or incorporated by reference in the Registration Statement, the Pricing
Disclosure Package and the Prospectus regarding “non-GAAP financial measures” (as such term is defined by the rules and
regulations of Commission) comply with Regulation G of the Exchange Act and Item 10 of Regulation S-K of the Securities Act, to
the extent applicable.
(g) No
Material Adverse Change. Since the date of the most recent financial statements of the Company included or incorporated by
reference in the Registration Statement, the Pricing Disclosure Package and the Prospectus, (i) there has not been any change
in the capital stock (other than the issuance of shares of Common Stock upon exercise of stock options and warrants described as
outstanding in, and the grant of options and awards under existing equity incentive plans described in, the Registration Statement,
the Pricing Disclosure Package and the Prospectus), short-term debt or long-term debt of the Company or any of its subsidiaries,
or any dividend or distribution of any kind declared, set aside for payment, paid or made by the Company on any class of capital
stock, or any material adverse change, or any development involving a material prospective adverse change, in or affecting the
business, properties, management, financial position, stockholders’ equity, results of operations or prospects of the Company
and its subsidiaries taken as a whole; (ii) neither the Company nor any of its subsidiaries has entered into any transaction
or agreement (whether or not in the ordinary course of business) that is material to the Company and its subsidiaries taken as
a whole or incurred any liability or obligation, direct or contingent, that is material to the Company and its subsidiaries taken
as a whole; and (iii) neither the Company nor any of its subsidiaries has sustained any loss or interference with its business
that is material to the Company and its subsidiaries taken as a whole and that is either from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor disturbance or dispute or any action, order or decree of any court or arbitrator
or governmental or regulatory authority, except in each case as otherwise disclosed in the Registration Statement, the Pricing
Disclosure Package and the Prospectus.
(h) Organization
and Good Standing. The Company and each of its subsidiaries have been duly organized and are validly existing and in good standing
under the laws of their respective jurisdictions of organization, are duly qualified to do business and are in good standing in
each jurisdiction in which their respective ownership or lease of property or the conduct of their respective businesses requires
such qualification, and have all power and authority necessary to own or hold their respective properties and to conduct the businesses
in which they are engaged, except where the failure to be so qualified or in good standing or have such power or authority would
not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the business, properties, management,
financial position, stockholders’ equity, results of operations or prospects of the Company and its subsidiaries taken as
a whole or on the performance by the Company of its obligations under this Agreement (a “Material Adverse Effect”).
The subsidiaries listed in Schedule 2 to this Agreement are the only significant subsidiaries of the Company.
(i) Capitalization.
The Company has the authorized, issued and outstanding shares of capital stock as set forth or incorporated by reference in the
Registration Statement, the Pricing Disclosure Package and the Prospectus under the caption “Capitalization” (except
for subsequent issuances, if any, pursuant to reservations, agreements or employee benefit plans referred to in the Pricing Disclosure
Package and the Prospectus or pursuant to the exercise of convertible securities or options referred to in the Pricing Disclosure
Package and the Prospectus). The outstanding shares of capital stock of the Company have been duly authorized and validly issued
and are fully paid and non-assessable. None of the outstanding shares of capital stock of the Company were issued in violation
of the preemptive or other similar rights of any securityholder of the Company.
(j) Due
Authorization. The Company has full right, power and authority to execute and deliver this Agreement and to perform its obligations
hereunder; and all action required to be taken for the due and proper authorization, execution and delivery by it of this Agreement
and the consummation by it of the transactions contemplated hereby has been duly and validly taken.
(k) Underwriting
Agreement. This Agreement has been duly authorized, executed and delivered by the Company.
(l) The
Shares. The Shares to be issued and sold by the Company hereunder have been duly authorized by the Company and, when issued
and delivered and paid for as provided herein, will be duly and validly issued, will be fully paid and nonassessable and will conform
in all material respects to the descriptions thereof in the Registration Statement, the Pricing Disclosure Package and the Prospectus;
and the issuance of the Shares is not subject to any preemptive or similar rights that have not been duly waived or satisfied.
(m) Description
of the Underwriting Agreement. This Agreement conforms in all material respects to the description thereof contained in the
Registration Statement, the Pricing Disclosure Package and the Prospectus.
(n) No
Violation or Default. Neither the Company nor any of its subsidiaries is (i) in violation of its charter or by-laws or
similar organizational documents; (ii) 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 any such entity is a party or by which it or any of them may be bound or to which any of the properties
or assets of any of the Company or any subsidiary is subject (collectively, “Agreements and Instruments”), except for
such defaults that would not, individually or in the aggregate, be reasonably expected to result in a Material Adverse Effect,
or (iii) in violation of any law, statute, rule, regulation, judgment, order, writ or decree (collectively, “Applicable
Law”) of any entity or body exercising executive, legislative, judicial, regulatory or administrative functions of United
States federal, state, local or municipal government, including any authority or other quasi-governmental entity established by
and to which authority shall have been delegated by a governmental body, or other authority, body or agency, in each case, having
jurisdiction over the Company or any of its subsidiaries or any of their respective properties, assets or operations (each, a “Governmental
Entity”), except for such violations that would not, individually or in the aggregate, be reasonably expected to result in
a Material Adverse Effect.
(o) No
Conflicts. The execution, delivery and performance of this Agreement and compliance by the Company with its obligations hereunder
have been duly authorized by all necessary corporate action of the Company 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 properties or assets of the Company
or any subsidiary pursuant to the Agreement, except for such conflicts, breaches, defaults or Repayment Events or liens, charges
or encumbrances that would not, individually or in the aggregate, be reasonably expected to result in a Material Adverse Effect,
nor will such action result in any violation of (A) the applicable charter or bylaws or similar organizational documents of
the Company or any subsidiary or (B) any law, statute, rule, regulation, judgment, order, writ or decree of any Governmental
Entity, except, with respect to clause (B), such violations as would not reasonably be expected to result in a Material Adverse
Effect. As used herein, a “Repayment Event” means any event or condition which gives the holder of any note, debenture
or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption
or repayment of all or a portion of such indebtedness by the Company or any subsidiary.
(p) No
Consents Required. No consent, approval, authorization, order, registration or qualification of or with any court or arbitrator
or governmental or regulatory authority is required for the execution, delivery and performance by the Company of this Agreement,
the issuance and sale of the Shares and the consummation of the transactions contemplated by this Agreement, except for the registration
of the Shares under the Securities Act and such consents, approvals, authorizations, orders and registrations or qualifications
as may be required by the Financial Industry Regulatory Authority, Inc. (“FINRA”) and under applicable state securities
laws in connection with the purchase and distribution of the Shares by the Underwriters.
(q) Absence
of Proceedings. Except as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, there
is no action, suit, proceeding, inquiry or investigation before or brought by any Governmental Entity now pending or, to the knowledge
of the Company, threatened, against or affecting the Company or any of its subsidiaries, which would be reasonably expected to
result in a Material Adverse Effect, or which would be reasonably expected to materially and adversely affect their respective
properties or assets or the performance by the Company of its obligations hereunder; and 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 properties or assets
is the subject which are not described in the Pricing Disclosure Package and the Prospectus, including ordinary routine litigation
incidental to the business, would not be reasonably expected to result in a Material Adverse Effect.
(r) Independent
Accountants. Deloitte & Touche LLP, who have certified certain financial statements of the Company and its subsidiaries
and Ernst & Young LLP, who have also certified certain financial statements of the Company and its subsidiaries, are each
an independent registered public accounting firm with respect to the Company and its subsidiaries within the applicable rules and
regulations adopted by the Commission and the Public Company Accounting Oversight Board (United States) and as required by the
Securities Act.
(s) Title
to Properties. The Company and its subsidiaries have good and marketable title to all real property owned by them and good
title to all other properties owned by them that are material to the Company, in each case, free and clear of all mortgages, pledges,
liens, security interests, claims, restrictions or encumbrances of any kind except such as (i) are described in the Registration
Statement, the Pricing Disclosure Package and the Prospectus or (ii) do not, individually 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 the subsidiaries,
considered as one enterprise, under which the Company or any of its subsidiaries holds properties described in the Registration
Statement, the Pricing Disclosure Package and the Prospectus, are in full force and effect, and neither the Company nor any such
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.
(t) Intellectual
Property Rights. 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, except for those the failure to own
or have such legal right to use would not be reasonably expected to result in a Material Adverse Effect, and neither the Company
nor any of its subsidiaries has received written notice 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 Property invalid or inadequate
to protect the interest of the Company, or any of its subsidiaries therein, which infringement or conflict (if the subject of any
unfavorable decision, ruling or finding) or invalidity or inadequacy, individually or in the aggregate, would be reasonably expected
to result in a Material Adverse Effect.
(u) No
Undisclosed Relationships. No relationship, direct or indirect, exists between or among the Company or any of its subsidiaries,
on the one hand, and the directors, officers, stockholders, customers, suppliers or other affiliates of the Company or any of its
subsidiaries, on the other, that is required by the Securities Act to be described in each of the Registration Statement and the
Prospectus and that is not so described in such documents and in the Pricing Disclosure Package.
(v) Investment
Company Act. The Company is not and, after giving effect to the offering and sale of the Shares and the application of the
proceeds thereof as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, will not be required
to register as an “investment company” or an entity “controlled” by an “investment company”
within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder
(collectively, the “Investment Company Act”).
(w) Tax
Law Compliance. All federal, state, local and foreign tax returns of the Company and its subsidiaries required by law to be
filed have been filed insofar as the failure to file such returns would not, individually or in the aggregate, by reasonably expected
to result in a Material Adverse Effect, and all taxes due and payable, and any related or similar assessment, fine or penalty levied
against the Company and its subsidiaries have been paid, other than taxes that are being contested in good faith and as to which
adequate reserves have been established by the Company in accordance with GAAP, except in any case in which the failure to pay
would not, individually or in the aggregate, be reasonably expected to result in a Material Adverse Effect. The charges, accruals
and reserves on the financial statements of the Company in respect of any income, corporation, franchise and other material tax
liability for any years not finally determined have been established in accordance with GAAP and are adequate to meet any assessments
or re-assessments for additional income tax for any years not finally determined, except to the extent of any inadequacy that would
not, individually or in the aggregate, be reasonably expected to result in a Material Adverse Effect. No tax deficiency has been
determined adversely to the Company or any of its subsidiaries, nor does the Company have any knowledge of any tax deficiencies
that have been, or would reasonably be expected to be, asserted against the Company or any subsidiary that would, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(x) Possession
of Licenses and Permits. The Company, its subsidiaries and the joint ventures set forth in Schedule 3 hereto (the “JVs”)
possess such certificates, consents, exemptions, orders, licenses, authorities, accreditations, provider or supplier numbers, certificates
of need or permits issued by the appropriate Governmental Entities (collectively, “Permits”) necessary to conduct the
business now owned, operated or managed by them including but not limited to such Permits as are required (i) under Health
Care Laws (as defined herein) and (ii) with respect to those facilities owned, operated or managed by the Company or any of
its subsidiaries or the JVs that participate in Medicare, Medicaid or any other local, state or federal government health care
program, to receive reimbursement thereunder, except where the failure to so possess would not be reasonably expected to result
in a Material Adverse Effect. The Company, its subsidiaries, and the JVs are in compliance with the terms and conditions of all
Permits, except where the failure to so comply would not be reasonably expected to result in a Material Adverse Effect. All of
the Permits are valid and in full force and effect, except when the invalidity of such Permits or the failure of such Permits to
be in full force and effect would not be reasonably expected to result in a Material Adverse Effect. None of the Company or any
of its subsidiaries or the JVs has received written notice of proceedings relating to the revocation or modification of any such
Permit that, if the subject of an unfavorable decision, ruling or finding, would be reasonably expected to result in a Material
Adverse Effect.
(y) No
Labor Disputes. No labor dispute with the employees of the Company or, to the knowledge of the Company, its subsidiaries exists
or, to the knowledge of the Company, is imminent, except as would not be reasonably expected to result in a Material Adverse Effect.
(z) Certain
Environmental Matters. Except as described in the Registration Statement, the Prospectus and the Pricing Disclosure Package
or as would not, individually or in the aggregate, be reasonably expected to result in a Material Adverse Effect, (A) neither
the Company nor any of its subsidiaries is in violation of any applicable federal, state, local or foreign statute, law, rule,
regulation, ordinance, code, policy or rule of common law or any judicial or administrative interpretation thereof, including
any judicial or administrative order, consent, decree or judgment, relating to pollution or protection of human health, the environment
(including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or wildlife, including,
without limitation, laws and regulations relating to the release or threatened release of chemicals, pollutants, contaminants,
wastes, toxic substances, hazardous substances, petroleum or petroleum products, asbestos-containing materials or mold (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 knowledge of the Company, threatened administrative, regulatory or
judicial actions, suits, demands, demand letters, claims, liens, notices of noncompliance or violation, investigations or proceedings
relating to any Environmental Law against the Company or any of its subsidiaries and (D) to the knowledge of the Company,
there are no events or circumstances that would 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 Entity, against or affecting the Company or any of its subsidiaries
relating to Hazardous Materials or any Environmental Laws.
(aa) Compliance
with ERISA. Except as would not, individually or in the aggregate, be reasonably expected to have a Material Adverse Effect,
(i) each “employee benefit plan” (as defined under the Employee Retirement Income Security Act of 1974, as amended,
and the regulations and published interpretations thereunder (collectively, “ERISA”)), whether or not subject to ERISA,
for which the Company or any member of its “Controlled Group” (defined as any organization which is a member of a controlled
group of corporations within the meaning of Section 414 of the Internal Revenue Code of 1986, as amended, and the regulations
and published interpretations thereunder (the “Code”)) has any liability (each, a “Plan”) has been maintained
in compliance with its terms and with the requirements of all applicable statutes, rules and regulations, including ERISA
and the Code; (ii) neither the Company nor any member of its Controlled Group has in the past six (6) years incurred,
or reasonably expects to incur, any liability under Title IV of ERISA in respect of a Plan (including a “multiemployer plan,”
within the meaning of Section 4001(c)(3) of ERISA); (iii) each Plan that is intended to be qualified under Section 401(a) of
the Code is so qualified and nothing has occurred, whether by action or by failure to act, which would cause the loss of such qualification;
(iv) there is no pending audit or investigation by the Internal Revenue Service, the U.S. Department of Labor, the Pension
Benefit Guaranty Corporation or any other governmental agency with respect to any Plan; and (v) neither the Company nor any
subsidiary has incurred any liability for any prohibited transaction, the failure of any Plan to meet the minimum funding standards
required by law, including by ERISA or the Code, or any complete or partial withdrawal liability with respect to any Plan.
(bb) Disclosure
Controls. The Company and its subsidiaries maintain an effective system of “disclosure controls and procedures”
(as defined in Rule 13a-15(e) of the Exchange Act) that complies with the requirements of the Exchange Act and that has
been designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the
Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and
forms, including controls and procedures designed to ensure that such information is accumulated and communicated to the Company’s
management as appropriate to allow timely decisions regarding required disclosure. The Company and its subsidiaries have carried
out evaluations of the effectiveness of their disclosure controls and procedures as required by Rule 13a-15 of the Exchange
Act.
(cc) Accounting
Controls. The Company and its subsidiaries maintain systems of “internal control over financial reporting” (as
defined in Rule 13a-15(f) of the Exchange Act) that comply with the requirements of the Exchange Act and have been designed
by, or under the supervision of, their respective principal executive and principal financial officers, or persons performing
similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with GAAP. The Company and its subsidiaries maintain internal accounting controls
sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general
or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management’s
general or specific authorization; (iv) the recorded accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences and (v) interactive data in eXtensible Business
Reporting Language included or incorporated by reference in the Registration Statement, the Prospectus and the Pricing Disclosure
Package fairly presents the information called for in all material respects and is prepared in accordance with the Commission’s
rules and guidelines applicable thereto.
(dd) Insurance.
The Company and its subsidiaries carry or are entitled to the benefits of insurance, with financially sound and reputable insurers,
in such amounts and covering such risks as is generally maintained by similarly sized and situated companies of established repute
engaged in the same or similar business, and all such insurance is in full force and effect, except where failure to carry such
insurance would not be reasonably expected to result in a Material Adverse Effect.
(ee) Cybersecurity;
Data Protection. The Company and its subsidiaries’ information technology assets and equipment, computers, systems,
networks, hardware, software, websites, applications, and databases (collectively, “IT Systems”) are adequate for,
and operate and perform in all material respects as required in connection with the operation of the business of the Company and
its subsidiaries as currently conducted, and free and clear of all material bugs, errors, defects, Trojan horses, time bombs, malware
and other corruptants. The Company and its subsidiaries have implemented and maintained commercially reasonable controls, policies,
procedures, and safeguards to maintain and protect their material confidential information and the security of all IT Systems and
data (including all personal, personally identifiable, sensitive, confidential or regulated data (“Personal Data”))
used in connection with their businesses, and there have been no breaches, violations, outages or unauthorized uses of or accesses
to same, except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Company
and its subsidiaries have implemented business continuity / disaster recovery plans and technology consistent with industry standards
and practice. The Company and its subsidiaries are presently in material compliance with all applicable laws or statutes and all
judgments, orders, rules and regulations of any court or arbitrator or governmental or regulatory authority, internal policies
and contractual obligations relating to the privacy and security of IT Systems and Personal Data and to the protection of such
IT Systems and Personal Data from unauthorized use, access, misappropriation or modification including the Data Privacy and Security
Laws (“Data Protection Requirements”), except as would not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect. To ensure compliance with the Data Protection Requirements, the Company and its subsidiaries
have in place, comply with, and take appropriate steps reasonably designed to ensure compliance in all material respects with their
policies and procedures relating to data privacy and security and the collection, storage, use, disclosure, handling, and analysis
of Personal Data (the “Policies”). The Company and its subsidiaries have at all times made all material disclosures
to patients or other individuals required by applicable Data Protection Requirements, and none of such disclosures made or contained
in any Policy have, to the knowledge of the Company, been inaccurate or in violation of any applicable Data Protection Requirements
in any material respect. The execution, delivery and performance of this Agreement or any other agreement referred to in this Agreement
will not result in a breach or violation of any Data Protection Requirements or Policies, except where such breach or violation
would not, individually or in the aggregate, have a Material Adverse Effect. The Company further certifies that neither it nor
any subsidiary: (i) has received notice of any actual or potential liability under or relating to, or actual or potential
violation of, any of the Data Protection Requirements, and has no knowledge of any event or condition that would reasonably be
expected to result in any such notice; (ii) is currently conducting or paying for, in whole or in part, any investigation,
remediation, or other corrective action pursuant to any Data Protection Requirement; or (iii) is a party to any order, decree,
or agreement that imposes any obligation or liability by any governmental authority under any Data Protection Requirement.
(ff) Foreign
Corrupt Practices Act. None of the Company or any of its subsidiaries (including any JV controlled by the Company), any of
the directors and officers thereof, or any controlled affiliate thereof, or, to the knowledge of the Company, any JV in which
the Company holds a minority interest, non-controlled affiliate, agent, employee, or other person acting on behalf of the Company,
any of its subsidiaries or any of the JVs is aware of, has taken or will take any action, directly or indirectly, that would result
in a violation by such persons of the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder
(the “FCPA”) or similar law of any other relevant jurisdiction, including, without limitation, making use of the mails
or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization
of the payment of any money, or other property, gift, promise to give, or authorization of the giving of anything of value to
any “foreign official” (as such term is defined in the FCPA) or any foreign political party or official thereof or
any candidate for foreign political office, in contravention of the FCPA and the Company, it subsidiaries (including any JV controlled
by the Company) and any affiliates thereof, and to the knowledge of the Company, any JV in which the Company holds a minority
interest, have conducted their businesses in compliance with the FCPA and have instituted and maintain policies and procedures
designed to ensure, and which are reasonably expected to continue to ensure, continued compliance therewith.
(gg) Compliance
with Anti-Money Laundering Laws. The operations of the Company, its subsidiaries (including any JV controlled by the Company)
and, to the knowledge of the Company, the JVs in which the Company holds a minority interest, are and have been conducted at all
times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions
Reporting Act of 1970, as amended, the money laundering statutes of all applicable jurisdictions, the rules and regulations
thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any Governmental Entity
(collectively, the “Money Laundering Laws”); and no action, suit or proceeding by or before any Governmental Entity
involving the Company or any of its subsidiaries (including any JV controlled by the Company) or, to the knowledge of the Company,
the JVs in which the Company holds a minority interest, with respect to the Money Laundering Laws is pending or, to the knowledge
of the Company, threatened.
(hh) OFAC.
None of the Company, any of its subsidiaries (including any JV controlled by the Company) or any of their respective directors
and officers, or any of the Company’s controlled affiliates, or, to the knowledge of the Company, any JVs in which the Company
holds a minority interest, non-controlled affiliate, agent, employee or representative of the Company or any of the subsidiaries
or JVs is an individual or entity (“Person”), or is owned or controlled by a Person, currently the subject or target
of any sanctions administered or enforced by the United States Government, including, without limitation, the U.S. Department of
the Treasury’s Office of Foreign Assets Control (“OFAC”), the United Nations Security Council (“UNSC”),
the European Union, Her Majesty’s Treasury (“HMT”), or other relevant sanctions authority (collectively, “Sanctions”),
nor located, organized or resident in a country or territory that is the subject or target of Sanctions (including, without limitation,
Crimea, Cuba, Iran, North Korea, Sudan and Syria); the Company will not directly or indirectly use the proceeds of the sale
of the Shares, or lend, contribute or otherwise make available such proceeds to any subsidiaries, joint venture partners or other
Person, to fund any activities of or business with any Person, or in any country or territory, that, at the time of such funding,
is the subject or target of Sanctions or in any other manner that will result in a violation by any Person (including any Person
participating in the transaction, whether as underwriter, advisor, investor or otherwise) of Sanctions; and for the past five years,
the Company and its subsidiaries and JVs have not knowingly engaged in, are not now knowingly engaged in, and will not engage in,
any dealings or transactions with any Person, or in any country or territory, that at the time of the dealing or transaction is
or was the subject of Sanctions.
(ii) No
Restrictions on Subsidiaries. No subsidiary of the Company is currently prohibited, directly or indirectly, under any agreement
or other instrument to which it is a party or is subject, from paying any dividends to the Company, from making any other distribution
on such subsidiary’s capital stock or similar ownership interest, from repaying to the Company any loans or advances to such
subsidiary from the Company or from transferring any of such subsidiary’s properties or assets to the Company or any other
subsidiary of the Company.
(jj) No
Broker’s Fees. Neither the Company nor any of its affiliates has engaged any broker, finder, commission agent or other
person (other than the Underwriters) in connection with the offering of Shares contemplated hereby, and neither the Company nor
any of its affiliates is under any obligation to pay any broker’s fee or commission in connection with the offering of Shares
contemplated hereby.
(kk) No
Registration Rights. No person has the right to require the Company or any of its subsidiaries to register any securities for
sale under the Securities Act by reason of the filing of the Registration Statement with the Commission or the issuance and sale
of the Shares.
(ll) No
Stabilization. Neither the Company nor any of its subsidiaries or affiliates has taken, directly or indirectly, any action
designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Shares.
(mm) Margin
Rules. Neither the issuance, sale and delivery of the Shares nor the application of the proceeds thereof by the Company as
described in each of the Registration Statement, the Pricing Disclosure Package and the Prospectus will violate Regulation T, U
or X of the Board of Governors of the Federal Reserve System or any other regulation of such Board of Governors.
(nn) Xxxxxxxx-Xxxxx
Act. There is and has been no failure on the part of the Company or any of the Company’s directors or officers, in their
capacities as such, to comply with any applicable provision of the Xxxxxxxx-Xxxxx Act of 2002, as amended and the rules and
regulations promulgated in connection therewith (the “Xxxxxxxx-Xxxxx Act”), including Section 402 related to loans
and Sections 302 and 906 related to certifications.
(oo) Status
under the Securities Act. At the time of filing the Registration Statement and any post-effective amendment thereto, at the
earliest time thereafter that the Company or any offering participant made a bona fide offer (within the meaning of Rule 164(h)(2) under
the Securities Act) of the Shares and at the date hereof, the Company was not and is not an “ineligible issuer,” and
is a well-known seasoned issuer, in each case as defined in Rule 405 under the Securities Act.
(pp) Third-Party
Payors. Except as described in the Registration Statement, the Prospectus and the Pricing Disclosure Package or as would not,
individually or in the aggregate, be reasonably expected to result in a Material Adverse Effect, the accounts receivable of the
Company and each of its subsidiaries and JVs have been adjusted to reflect contractual allowances provided to third-party payors,
private insurance companies, health maintenance organizations, preferred provider organizations, alternative delivery systems,
managed care systems, government contracting agencies and other third-party payors and the rates established by governmental payors,
including Medicare, Medicaid and, in some instances, for workers’ compensation claims. In particular, accounts receivable
relating to such third-party payors do not exceed amounts any obligee is entitled to receive under any capitation arrangement,
fee schedule, discount formula, cost-based reimbursement or other adjustment or limitation to its usual charges.
(qq) Compliance
with Health Care Laws. Except as described in the Registration Statement, the Prospectus and the Pricing Disclosure Package
or except as would not, individually or in the aggregate, be reasonably expected to have a Material Adverse Effect, each of the
Company, its subsidiaries and the JVs is, and at all times has been, in compliance with all applicable Health Care Laws, and has
not engaged in activities which are, as applicable, cause for false claims liability, civil penalties, or mandatory or permissive
exclusion from Medicare, Medicaid, or any other state health care program or federal health care program. For purposes of this
Agreement, “Health Care Laws” means all Applicable Laws of any Governmental Entity pertaining to health care regulatory
matters applicable to the operations of the Company, its subsidiaries or its JVs, including (i) federal, state and local health
care related fraud and abuse laws, including, without limitation, state corporate practice of medicine laws and regulations, state
professional fee-splitting laws and regulations, state workers’ compensation laws and regulations, the Anti-Kickback Statute
(42 U.S.C. Section 1320a-7b(b)), the Xxxxx Law (42 U.S.C. Section 1395nn), the Civil False Claims Act (31 U.S.C. Section 3729
et seq.), the criminal False Claims Law (42 U.S.C. § 1320a-7b(a)), all criminal laws relating to health care fraud and abuse,
including but not limited to 18 U.S.C. Sections 286 and 287, and the health care fraud criminal provisions under HIPAA (as defined
below), the exclusion laws (42 U.S.C. § 1320a-7), the civil monetary penalties law (42 U.S.C. § 1320a-7a), any applicable
state fraud and abuse prohibitions, including those that apply to all payors (governmental, commercial insurance and self-payors),
each as amended, and the implementing rules and regulations promulgated pursuant to such statutes; (ii) Medicare (Title
XVIII of the Social Security Act); (iii) Medicaid (Title XIX of the Social Security Act), and the regulations promulgated
thereunder; (iv) (a) the Health Insurance Portability and Accountability Act of 1996, 42 U.S.C. §§ 1320d-1329d-8,
as amended by the Health Information Technology for Economic and Clinical Health Act, enacted as Title XIII of the American Recovery
and Reinvestment Act of 2009, Public Law 111-5 (“HIPAA”); (b) all applicable implementing laws and regulations;
and (c) any similar state and local Applicable Laws regarding data protection, data processing, data privacy, data security
and/or the collection, use, storage, disclosure or cross-border transfer of personal data and information, including protected
health information (collectively, including HIPAA, the “Data Privacy and Security Laws”); (v) any state
and federal controlled substance and drug diversion laws, including the Federal Controlled Substances Act (21 U.S.C. § 801,
et seq.) and the regulations promulgated thereunder; (vi) the Clinical Laboratory Improvement Amendments of 1988, 42
U.S.C. § 263a et seq.; (vii) any Applicable Law pertaining to or regulating the provision or administration
of, or payment for, healthcare products and services (such services include physician and allied professional services and related
ancillary services); (viii) and Applicable Law regulating the ownership or operation of a health care facility or business,
or assets used in connection therewith, including licensing, certification and/or accreditation requirements; and (ix) any
and all other health care laws and regulations, each as amended from time to time, applicable to the operations of the Company,
its subsidiaries or its JVs. Except as described in the Registration Statement, the Prospectus and the Pricing Disclosure Package,
none of the Company, any subsidiary or any of the JVs has received written notice from any Governmental Entity of any claim, action,
suit, proceeding, hearing, enforcement, investigation, arbitration or other action alleging that any of the Company, the subsidiaries
or the JVs is in material violation of any Health Care Laws, and, to the Company’s knowledge, no such claim, action, suit,
proceeding, hearing, enforcement, investigation, arbitration or other action is threatened. Except as described in the Registration
Statement, the Prospectus and the Pricing Disclosure Package, none of the Company, any subsidiary or any of the JVs is a party
to or has any ongoing reporting obligations pursuant to any corporate integrity agreements, deferred prosecution agreements, monitoring
agreements, consent decrees, settlement orders, plans of correction or similar agreements with or imposed by any Governmental Entity.
Additionally, none of the Company, its subsidiaries, or the JVs nor any of their respective employees, officers or directors has
been excluded, suspended or debarred from participation in any U.S. federal health care program or is subject to a governmental
inquiry, investigation, proceeding, or other similar action that could reasonably be expected to result in debarment, suspension,
or exclusion.
(rr) Program
Participation. Except as described in the Registration Statement, the Prospectus and the Pricing Disclosure Package, the Company,
its subsidiaries, and the JVs, as applicable, meet all material requirements of participation of the Programs, are a party to valid
participation agreements for payment by such Programs, and has not at any time violated in any material respects any condition
of participation, condition of payment or any rule, regulation or policy or standard of any Program. None of the Company, its subsidiaries
or the JVs, has received notice from any of the Programs of any pending or threatened investigations that would result in exclusion
or debarment from any such Programs or the termination of any Program participation or payor agreement. “Programs”
shall mean Medicare, Medicaid, and any other local, state or federal health care program as well as other third-party payor programs,
including, but not limited to private insurance companies, health maintenance organizations, preferred provider organizations,
alternative delivery systems, and managed care systems, that the Company, its subsidiaries and the JVs, as applicable, participate
in or has contracts with.
(ss) Program
Claims and Filings. Except as described in the Registration Statement, the Prospectus and the Pricing Disclosure Package or
except as would not be reasonably expected to result in, individually or in the aggregate, a Material Adverse Effect, to the Company’s
knowledge, all reports, data, and information required to be filed by the Company, its subsidiaries, and the JVs in connection
with any Program have been timely filed and were true and complete at the time filed (or were corrected in or supplemented by a
subsequent filing). Except as described in the Registration Statement, the Prospectus and the Pricing Disclosure Package, none
of the Company, its subsidiaries and the JVs has submitted to any Program any false or fraudulent claim for payment. Except as
described in the Registration Statement, the Prospectus and the Pricing Disclosure Package, there are no claims, actions or appeals
pending (and the Company, its subsidiaries, and the JVs have not made any filing or submission that would result in any claims,
actions or appeals) before any Governmental Entity with respect to any Program reports or claims filed by the Company, or any of
its subsidiaries or the JVs on or before the date hereof, or with respect to any disallowances by any Governmental Entity in connection
with any audit or any claims that, if adversely determined, which would be reasonably expected to result in, individually or in
the aggregate, a Material Adverse Effect. Except as described in the Registration Statement, the Prospectus and the Pricing Disclosure
Package, no validation review or program integrity review related to the Company, or any of its subsidiaries or the JVs has been
conducted by any governmental entity in connection with any Program within the past three (3) years which, if determined adversely
to the Company or any of its respective subsidiaries or JVs, has had, or would reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect, and to the Company’s knowledge, no such reviews are scheduled, pending, threatened
against or affecting the Company or any of its subsidiaries or JVs. Except in the ordinary course of business or as set forth in
or incorporated by reference in the Registration Statement, the Pricing Disclosure Package and the Prospectus, there are no material
suspensions, offsets or recoupments of any Program being sought, requested or claimed, or to the knowledge of the Company, threatened
against the Company, its subsidiaries or the JVs.
(tt) Company
Providers. The Company and each of its subsidiaries and JVs is in material compliance with all Applicable Laws regarding the
selection, deselection, and credentialing of contracted or employed healthcare providers, including, but not limited to, verification
of licensing status and eligibility for reimbursement under the Programs. Except as has not had, and would not be reasonably expected
to result in, individually or in the aggregate, a Material Adverse Effect, all of the Company’s, its subsidiaries’
and the JVs’ contracted or employed healthcare providers are properly licensed and hold appropriate clinical privileges,
as applicable, for the services that they provide, and, with respect to providers that perform services eligible for reimbursement
under any Program, are not debarred or excluded from any such Program.
4. Further
Agreements of the Company. The Company covenants and agrees with each Underwriter that:
(a) Required
Filings. The Company will file the final Prospectus with the Commission within the time periods specified by Rule 424(b) and
Rule 430A, 430B or 430C under the Securities Act, will file any Issuer Free Writing Prospectus to the extent required by Rule 433
under the Securities Act; and the Company will file promptly all reports and any definitive proxy or information statements required
to be filed by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent
to the date of the Prospectus and for so long as the delivery of a prospectus is required in connection with the offering or sale
of the Shares; and the Company will furnish copies of the Prospectus and each Issuer Free Writing Prospectus (to the extent not
previously delivered) to the Underwriters in New York City prior to 10:00 A.M., New York City time, on the business day next succeeding
the date of this Agreement in such quantities as the Representatives may reasonably request. The Company will pay the registration
fee for this offering within the time period required by Rule 456(b)(1) under the Securities Act (without giving effect
to the proviso therein) and in any event prior to the Closing Date.
(b) Delivery
of Copies. The Company will deliver, without charge, (i) to the Representatives, three signed copies of the Registration
Statement as originally filed and each amendment thereto, in each case including all exhibits and consents filed therewith and
documents incorporated by reference therein; and (ii) to each Underwriter (A) a conformed copy of the Registration Statement
as originally filed and each amendment thereto (without exhibits) and (B) during the Prospectus Delivery Period (as defined
below), as many copies of the Prospectus (including all amendments and supplements thereto and documents incorporated by reference
therein and each Issuer Free Writing Prospectus) as the Representatives may reasonably request. As used herein, the term “Prospectus
Delivery Period” means such period of time after the first date of the public offering of the Shares as in the opinion of
counsel for the Underwriters a prospectus relating to the Shares is required by law to be delivered (or required to be delivered
but for Rule 172 under the Securities Act) in connection with sales of the Shares by any Underwriter or dealer.
(c) Amendments
or Supplements, Issuer Free Writing Prospectuses. Before making, preparing, using, authorizing, approving, referring to
or filing any Issuer Free Writing Prospectus, and before filing any amendment or supplement to the Registration Statement, the
Pricing Disclosure Package or the Prospectus, whether before or after the time that the Registration Statement becomes effective,
the Company will furnish to the Representatives and counsel for the Underwriters a copy of the proposed Issuer Free Writing Prospectus,
amendment or supplement for review and will not make, prepare, use, authorize, approve, refer to or file any such Issuer Free Writing
Prospectus or file any such proposed amendment or supplement to which the Representatives reasonably object.
(d) Notice
to the Representatives. The Company will advise the Representatives promptly, and confirm such advice in writing, (i) when
the Registration Statement has become effective upon filing; (ii) when any amendment to the Registration Statement has been
filed or becomes effective; (iii) when any supplement to the Pricing Disclosure Package, the Prospectus, or any Issuer Free
Writing Prospectus or any amendment to the Prospectus has been filed or distributed; (iv) of any request by the Commission
for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or the receipt of any comments
from the Commission relating to the Registration Statement or any other request by the Commission for any additional information;
(v) of the issuance by the Commission or any other governmental or regulatory authority of any order suspending the effectiveness
of the Registration Statement or preventing or suspending the use of any Preliminary Prospectus, any of the Pricing Disclosure
Package or the Prospectus or the initiation or threatening of any proceeding for that purpose or pursuant to Section 8A of
the Securities Act; (vi) of the occurrence of any event or development within the Prospectus Delivery Period as a result of
which the Prospectus, any of the Pricing Disclosure Package or any Issuer Free Writing Prospectus as then amended or supplemented
would include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances existing when the Prospectus, the Pricing Disclosure Package or any such Issuer Free
Writing Prospectus is delivered to a purchaser, not misleading; and (vii) of the receipt by the Company of any notice of objection
of the Commission to the use of the Registration Statement or any post-effective amendment thereto pursuant to Rule 401(g)(2) under
the Securities Act; and (viii) of the receipt by the Company of any notice with respect to any suspension of the qualification
of the Shares for offer and sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and the
Company will use its reasonable best efforts to prevent the issuance of any such order suspending the effectiveness of the Registration
Statement, preventing or suspending the use of any Preliminary Prospectus, any of the Pricing Disclosure Package or the Prospectus
or suspending any such qualification of the Shares and, if any such order is issued, will use its reasonable best efforts to obtain
as soon as possible the withdrawal thereof.
(e) Ongoing
Compliance. (1) If during the Prospectus Delivery Period (i) any event or development shall occur or condition shall
exist as a result of which the Prospectus as then amended or supplemented would include any untrue statement of a material fact
or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances existing
when the Prospectus is delivered to a purchaser, not misleading or (ii) it is necessary to amend or supplement the Prospectus
to comply with law, the Company will promptly notify the Underwriters thereof and forthwith prepare and, subject to paragraph (c) above,
file with the Commission and furnish to the Underwriters and to such dealers as the Representatives may designate such amendments
or supplements to the Prospectus (or any document to be filed with the Commission and incorporated by reference therein) as may
be necessary so that the statements in the Prospectus as so amended or supplemented (or any document to be filed with the Commission
and incorporated by reference therein) will not, in the light of the circumstances existing when the Prospectus is delivered to
a purchaser, be misleading or so that the Prospectus will comply with law and (2) if at any time prior to the Closing Date
(i) any event or development shall occur or condition shall exist as a result of which the Pricing Disclosure Package as then
amended or supplemented would include any untrue statement of a material fact or omit to state any material fact necessary in order
to make the statements therein, in the light of the circumstances existing when the Pricing Disclosure Package is delivered to
a purchaser, not misleading or (ii) it is necessary to amend or supplement the Pricing Disclosure Package to comply with law,
the Company will promptly notify the Underwriters thereof and forthwith prepare and, subject to paragraph (c) above, file
with the Commission (to the extent required) and furnish to the Underwriters and to such dealers as the Representatives may designate
such amendments or supplements to the Pricing Disclosure Package (or any document to be filed with the Commission and incorporated
by reference therein) as may be necessary so that the statements in the Pricing Disclosure Package as so amended or supplemented
will not, in the light of the circumstances existing when the Pricing Disclosure Package is delivered to a purchaser, be misleading
or so that the Pricing Disclosure Package will comply with law.
(f) Blue
Sky Compliance. The Company will qualify the Shares for offer and sale under the securities or Blue Sky laws of such jurisdictions
as the Representatives shall reasonably request and will continue such qualifications in effect so long as required for distribution
of the Shares; provided that the Company shall not be required to (i) qualify as a foreign corporation or other entity
or as a dealer in securities in any such jurisdiction where it would not otherwise be required to so qualify, (ii) file any
general consent to service of process in any such jurisdiction or (iii) subject itself to taxation in any such jurisdiction
if it is not otherwise so subject.
(g) Earning
Statement. The Company will make generally available to its security holders and the Representatives as soon as practicable
an earning statement that satisfies the provisions of Section 11(a) of the Securities Act and Rule 158 of the Commission
promulgated thereunder covering a period of at least twelve months beginning with the first fiscal quarter of the Company occurring
after the “effective date” (as defined in Rule 158) of the Registration Statement; provided that the Company will
be deemed to have furnished such statements to its security holders and the Representatives to the extent that they are filed on
the Commission’s Electronic Data Gathering, Analysis and Retrieval system.
(h) Clear
Market. For a period of 60 days after the date of the Prospectus, the Company will not (i) offer, pledge, sell, contract
to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to
purchase, lend, or otherwise transfer or dispose of, directly or indirectly, or submit to, or file with, the Commission a registration
statement under the Securities Act relating to, any shares of Stock or any securities convertible into or exercisable or exchangeable
for Stock, or publicly disclose the intention to undertake any of the foregoing, or (ii) enter into any swap or other agreement
that transfers, in whole or in part, any of the economic consequences of ownership of the Stock or any such other securities, whether
any such transaction described in clause (i) or (ii) above is to be settled by delivery of Stock or such other securities,
in cash or otherwise, without the prior written consent of X.X. Xxxxxx Securities LLC (“X.X. Xxxxxx”) and Xxxxxxxxx
LLC (“Jefferies”), other than the Shares to be sold hereunder.
The restrictions described above
do not apply to (i) the issuance of shares of Stock or securities convertible into or exercisable for shares of Stock pursuant
to the conversion or exchange of convertible or exchangeable securities or the exercise of warrants or options (including net exercise)
or the settlement of RSUs (including net settlement), in each case outstanding on the date of this Agreement and described in the
Prospectus; (ii) grants of stock options, stock awards, restricted stock, RSUs, or other equity awards and the issuance of
shares of Stock or securities convertible into or exercisable or exchangeable for shares of Stock (whether upon the exercise of
stock options or otherwise) to the Company’s employees, officers, directors, advisors, or consultants pursuant to the terms
of an equity compensation plan in effect as of the Closing Date and described in the Prospectus, provided that such recipients
enter into a lock-up agreement with the Underwriters; (iii) the filing of any registration statement on Form S-8 relating
to securities granted or to be granted pursuant to any plan in effect on the date of this Agreement and described in the Prospectus
or any assumed benefit plan pursuant to an acquisition or similar strategic transaction; or (iv) the filing of any registration
statement on Form S-4 or other appropriate form with respect to the issuance by the Company of shares of any class of the
common stock of the Company or any securities convertible into or exercisable or exchangeable for shares of any class of the Company’s
common stock in connection with future business combinations or acquisitions (or the entering into of an acquisition or similar
agreement with respect thereto); provided that, in the case of clause (iv), the aggregate number of shares of common stock
issued in connection with, all such business combinations or acquisitions does not exceed 5% of the aggregate number of shares
of common stock outstanding immediately following the offering of shares pursuant to this Agreement and the recipient of the shares
of common stock agrees in writing to be bound by the same terms described in the “lock-up” agreement described in Section 6(m) hereof.
(i) Use
of Proceeds. The Company will apply the net proceeds from the sale of the Shares as described in each of the Registration Statement,
the Pricing Disclosure Package and the Prospectus under the heading “Use of Proceeds”.
(j) No
Stabilization. Neither the Company nor its subsidiaries or affiliates will take, directly or indirectly, without giving effect
to activities by the Underwriters, any action designed to or that could reasonably be expected to cause or result in any stabilization
or manipulation of the price of the Stock.
(k) Exchange
Listing. The Company will use its reasonable best efforts to list for quotation the Shares on the Nasdaq Global Market (the
“Nasdaq Market”).
(l) Reports.
During a period of three years from the date of this Agreement, the Company will furnish to the Representatives, as soon as commercially
reasonable after the date they are available, copies of all reports or other communications (financial or other) furnished to holders
of the Shares, and copies of any reports and financial statements furnished to or filed with the Commission or any national securities
exchange or automatic quotation system; provided the Company will be deemed to have furnished such reports and financial
statements to the Representatives to the extent they are filed on the Commission’s Electronic Data Gathering, Analysis, and
Retrieval system, or any successor to such system.
(m) Record
Retention. The Company will, pursuant to reasonable procedures developed in good faith, retain copies of each Issuer Free Writing
Prospectus that is not filed with the Commission in accordance with Rule 433 under the Securities Act.
(n) Shelf
Renewal. If immediately prior to the third anniversary (the “Renewal Deadline”) of the initial effective date of
the Registration Statement, any of the Shares remain unsold by the Underwriters, the Company will, prior to the Renewal Deadline,
file, if it has not already done so and is eligible to do so, a new automatic shelf registration statement relating to the Shares,
in a form satisfactory to the Representatives. If the Company is not eligible to file an automatic shelf registration statement,
the Company will, prior to the Renewal Deadline, if it has not already done so, file a new shelf registration statement relating
to the Shares, in a form satisfactory to the Representatives, and will use its reasonable best efforts to cause such registration
statement to be declared effective within 180 days after the Renewal Deadline. The Company will take all other action necessary
or appropriate to permit the issuance and sale of the Shares to continue as contemplated in the expired registration statement
relating to the Shares. References herein to the Registration Statement shall include such new automatic shelf registration statement
or such new shelf registration statement, as the case may be.
5. Certain
Agreements of the Underwriters. Each Underwriter hereby
represents and agrees that:
(a) It
has not and will not use, authorize use of, refer to or participate in the planning for use of, any “free writing prospectus”,
as defined in Rule 405 under the Securities Act (which term includes use of any written information furnished to the Commission
by the Company and not incorporated by reference into the Registration Statement and any press release issued by the Company) other
than (i) a free writing prospectus that contains no “issuer information” (as defined in Rule 433(h)(2) under
the Securities Act) that was not included (including through incorporation by reference) in the Preliminary Prospectus or a previously
filed Issuer Free Writing Prospectus, (ii) any Issuer Free Writing Prospectus listed on Annex A or prepared pursuant to Section 3(c) or
Section 4(c) above (including any electronic road show), or (iii) any free writing prospectus prepared by such underwriter
and approved by the Company in advance in writing (each such free writing prospectus referred to in clauses (i) or (iii),
an “Underwriter Free Writing Prospectus”).
(b) It
has not and will not, without the prior written consent of the Company, use any free writing prospectus that contains the final
terms of the Shares unless such terms have previously been included in a free writing prospectus filed with the Commission; provided
that Underwriters may use a term sheet substantially in the form of Annex B hereto without the consent of the Company; provided
further that any Underwriter using such term sheet shall notify the Company, and provide a copy of such term sheet to the Company,
prior to, or substantially concurrently with, the first use of such term sheet.
(c) It
is not subject to any pending proceeding under Section 8A of the Securities Act with respect to the offering (and will promptly
notify the Company if any such proceeding against it is initiated during the Prospectus Delivery Period).
6. Conditions
of Underwriters’ Obligations. The obligation of each Underwriter to purchase the Underwritten Shares on the Closing Date
or the Option Shares on the Additional Closing Date, as the case may be, as provided herein is subject to the performance by the
Company of its covenants and other obligations hereunder and to the following additional conditions:
(a) Registration
Compliance; No Stop Order. No order suspending the effectiveness of the Registration Statement shall be in effect, and no proceeding
for such purpose, pursuant to Rule 401(g)(2) or pursuant to Section 8A under the Securities Act shall be pending
before or threatened by the Commission; the Prospectus and each Issuer Free Writing Prospectus shall have been timely filed with
the Commission under the Securities Act (in the case of an Issuer Free Writing Prospectus, to the extent required by Rule 433
under the Securities Act) and in accordance with Section 4(a) hereof; and all requests by the Commission for additional
information shall have been complied with to the reasonable satisfaction of the Representatives.
(b) Representations
and Warranties. The representations and warranties of the Company contained herein shall be true and correct on the date hereof
and on and as of the Closing Date or the Additional Closing Date, as the case may be; and the statements of the Company and its
officers made in any certificates delivered pursuant to this Agreement shall be true and correct on and as of the Closing Date
or the Additional Closing Date, as the case may be.
(c) No
Downgrade. Subsequent to the earlier of (A) the Applicable Time and (B) the execution and delivery of this Agreement,
(i) no downgrading shall have occurred in the rating accorded any debt securities, convertible securities or preferred stock
issued, or guaranteed by, the Company or any of its subsidiaries by any “nationally recognized statistical rating organization,”
as such term is defined under Section 3(a)(62) under the Exchange Act and (ii) no such organization shall have publicly
announced that it has under surveillance or review, or has changed its outlook with respect to, its rating of any such debt securities
or preferred stock issued or guaranteed by the Company or any of its subsidiaries (other than an announcement with positive implications
of a possible upgrading).
(d) No
Material Adverse Change. No event or condition of a type described in Section 3(g) hereof shall have occurred or
shall exist, which event or condition is not described in the Pricing Disclosure Package (excluding any amendment or supplement
thereto) and the Prospectus (excluding any amendment or supplement thereto) and the effect of which in the judgment of the Representatives
makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Shares on the Closing Date or the Additional
Closing Date, as the case may be, on the terms and in the manner contemplated by this Agreement, the Pricing Disclosure Package
and the Prospectus.
(e) Officer’s
Certificate. The Representatives shall have received on and as of the Closing Date or the Additional Closing Date, as the case
may be, a certificate of the chief financial officer or chief accounting officer of the Company and one additional senior executive
officer of the Company who is satisfactory to the Representatives, on behalf of the Company and not in their individual capacity,
(i) confirming that such officers have carefully reviewed the Registration Statement, the Pricing Disclosure Package and the
Prospectus and, to the knowledge of such officers, the representations set forth in Sections 3(b) and 3(d) hereof are
true and correct, (ii) confirming that the other representations and warranties of the Company in this Agreement are true
and correct and that the Company has complied in all material respects with all agreements and satisfied all conditions on its
part to be performed or satisfied hereunder at or prior to the Closing Date or the Additional Closing Date, as the case may be,
and (iii) to the effect set forth in paragraphs (a), (c) and (d) above.
(f) Comfort
Letters. (i) On the date of this Agreement and on the Closing Date or the Additional Closing Date, as the case may be,
each of Deloitte & Touche LLP and Ernst & Young LLP shall have furnished to the Representatives, at the request
of the Company, letters, dated the respective dates of delivery thereof and addressed to the Underwriters, in form and substance
reasonably satisfactory to the Representatives, containing statements and information of the type customarily included in accountants’
“comfort letters” to underwriters with respect to the financial statements and certain financial information contained
or incorporated by reference in each of the Registration Statement, the Pricing Disclosure Package and the Prospectus; provided,
that the letter delivered on the Closing Date or the Additional Closing Date, as the case may be, shall use a “cut-off”
date no more than two business days prior to such Closing Date or such Additional Closing Date, as the case may be.
(ii) On the date of this
Agreement and on the Closing Date or the Additional Closing Date, as the case may be, the Company shall have furnished to the Representatives
a certificate, dated the respective dates of delivery thereof and addressed to the Underwriters, of its chief financial officer
with respect to certain financial data contained in the Pricing Disclosure Package and the Prospectus, providing “management
comfort” with respect to such information, in form and substance reasonably satisfactory to the Representatives.
(g) Opinion
and 10b-5 Statement of Counsel for the Company. Ropes & Xxxx LLP, counsel for the Company, shall have furnished to
the Representatives, at the request of the Company, their written opinion and 10b-5 statement, dated the Closing Date or the Additional
Closing Date, as the case may be, and addressed to the Underwriters, in form and substance reasonably satisfactory to the Representatives.
(h) Opinion
and 10b-5 Statement of Counsel for the Underwriters. The Representatives shall have received on and as of the Closing Date
or the Additional Closing Date, as the case may be, an opinion and 10b-5 statement, addressed to the Underwriters, of Xxxxxx &
Xxxxxxx LLP, counsel for the Underwriters, with respect to such matters as the Representatives may reasonably request, and such
counsel shall have received such documents and information as they may reasonably request to enable them to pass upon such matters.
(i) Opinion
of Regulatory Counsel for the Company. The Representatives shall have received on and as of the Closing Date or the Additional
Closing Date, as the case may be, an opinion, addressed to the Underwriters, from Xxxxxx Landsen Xxxxxx & Xxxxx, LLP,
counsel to the Company for regulatory matters, in form and substance reasonably satisfactory to the Representatives.
(j) No
Legal Impediment to Issuance and Sale. No action shall have been taken and no statute, rule, regulation or order shall have
been enacted, adopted or issued by any federal, state or foreign governmental or regulatory authority that would, as of the Closing
Date or the Additional Closing Date, as the case may be, prevent the issuance or sale of the Shares; and no injunction or order
of any federal, state or foreign court shall have been issued that would, as of the Closing Date or the Additional Closing Date,
as the case may be, prevent the issuance or sale of the Shares.
(k) Good
Standing. The Representatives shall have received on and as of the Closing Date or the Additional Closing Date, as the case
may be, satisfactory evidence of the good standing of the Company and its subsidiaries in their respective jurisdictions of organization
and their good standing in such other jurisdictions as the Representatives may reasonably request, in each case in writing or any
standard form of telecommunication from the appropriate governmental authorities of such jurisdictions.
(l) Exchange
Listing. The Shares to be delivered on the Closing Date or the Additional Closing Date, as the case may be, shall have been
approved for listing on the Nasdaq Market, subject to official notice of issuance.
(m) Lock-up
Agreements. The “lock-up” agreements, each substantially in the form of Exhibit A hereto, between you and
certain shareholders, officers and directors of the Company relating to sales and certain other dispositions of shares of Stock
or certain other securities, delivered to you on or before the date hereof, shall be full force and effect on the Closing Date
or the Additional Closing Date, as the case may be.
(n) Additional
Documents. On or prior to the Closing Date or the Additional Closing Date, as the case may be, the Company shall have furnished
to the Representatives such further certificates and documents as the Representatives may reasonably request.
All opinions, letters, certificates and
evidence mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if
they are in form and substance reasonably satisfactory to counsel for the Underwriters.
7. Indemnification
and Contribution.
(a) Indemnification
of the Underwriters. The Company agrees to indemnify and hold harmless each Underwriter, its affiliates, directors and officers
and each person, if any, who controls such Underwriter within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act, from and against any and all losses, claims, damages and liabilities (including, without limitation, legal
fees and other expenses incurred in connection with any suit, action or proceeding or any claim asserted, as such fees and expenses
are incurred), joint or several, that arise out of, or are based upon, (i) any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or caused by any omission or alleged omission to state therein a material
fact required to be stated therein or necessary in order to make the statements therein, not misleading, or (ii) any untrue
statement or alleged untrue statement of a material fact contained in the Prospectus (or any amendment or supplement thereto),
any Preliminary Prospectus, any Issuer Free Writing Prospectus, any “issuer information” filed or required to be filed
pursuant to Rule 433(d) under the Securities Act, any road show as defined in Rule 433(h) under the Securities
Act (a “road show”) or any Pricing Disclosure Package, or caused by any omission or alleged omission to state therein
a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not
misleading, in each case except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any untrue
statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating
to any Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use therein,
it being understood and agreed that the only such information furnished by any Underwriter consists of the information described
as such in paragraph (b) below.
(b) Indemnification
of the Company. Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, its directors,
its officers who signed the Registration Statement and each person, if any, who controls the Company within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act to the same extent as the indemnity set forth in paragraph (a) above,
but only with respect to any losses, claims, damages or liabilities that arise out of, or are based upon, any untrue statement
or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to such
Underwriter furnished to the Company in writing by such Underwriter through the Representatives expressly for use in the Registration
Statement, the Prospectus (or any amendment or supplement thereto), any Preliminary Prospectus, any Issuer Free Writing Prospectus,
any road show or any Pricing Disclosure Package, it being understood and agreed upon that the only such information furnished by
any Underwriter consists of the following information in the Prospectus furnished on behalf of each Underwriter: the concession
and reallowance figures appearing in the third paragraph under the caption “Underwriting” and the information contained
in the eighteenth paragraph under the caption “Underwriting.”
(c) Notice
and Procedures. If any suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall
be brought or asserted against any person in respect of which indemnification may be sought pursuant to the preceding paragraphs
of this Section 7, such person (the “Indemnified Person”) shall promptly notify the person against whom such indemnification
may be sought (the “Indemnifying Person”) in writing; provided that the failure to notify the Indemnifying Person
shall not relieve it from any liability that it may have under the preceding paragraphs of this Section 7 except to the extent
that it has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and provided,
further, that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have to
an Indemnified Person otherwise than under the preceding paragraphs of this Section 7. If any such proceeding shall be brought
or asserted against an Indemnified Person and it shall have notified the Indemnifying Person thereof, the Indemnifying Person shall
retain counsel reasonably satisfactory to the Indemnified Person (who shall not, without the consent of the Indemnified Person,
be counsel to the Indemnifying Person) to represent the Indemnified Person and any others entitled to indemnification pursuant
to this Section that the Indemnifying Person may designate in such proceeding and shall pay the reasonable and documented
fees and expenses in such proceeding and shall pay the reasonable and documented fees and expenses of such counsel related to such
proceeding, as incurred. In any such proceeding, any Indemnified Person shall have the right to retain its own counsel, but the
fees and expenses of such counsel shall be at the expense of such Indemnified Person unless (i) the Indemnifying Person and
the Indemnified Person shall have mutually agreed to the contrary; (ii) the Indemnifying Person has failed within a reasonable
time to retain counsel reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person shall have reasonably
concluded that there may be legal defenses available to it that are different from or in addition to those available to the Indemnifying
Person; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the Indemnifying Person
and the Indemnified Person and representation of both parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood and agreed that the Indemnifying Person shall not, in connection with any proceeding
or related proceeding in the same jurisdiction, be liable for the fees and expenses of more than one separate firm (in addition
to any local counsel) for all Indemnified Persons, and that all such fees and expenses shall be paid or reimbursed as they are
incurred. Any such separate firm for any Underwriter, its affiliates, directors and officers and any control persons of such Underwriter
shall be designated in writing by the Representatives and any such separate firm for the Company, its directors, its officers who
signed the Registration Statement and any control persons of the Company shall be designated in writing by the Company. The Indemnifying
Person shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such
consent, the Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or liability by reason of
such settlement. Notwithstanding the foregoing sentence, if at any time an Indemnified Person shall have requested that an Indemnifying
Person reimburse the Indemnified Person for reasonable and documented fees and expenses of counsel as contemplated by this paragraph,
the Indemnifying Person shall be liable for any settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by the Indemnifying Person of such request and (ii) the Indemnifying
Person shall not have reimbursed the Indemnified Person in accordance with such request prior to the date of such settlement. No
Indemnifying Person shall, without the written consent of the Indemnified Person, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Person is or could have been a party and indemnification could have been sought
hereunder by such Indemnified Person, unless such settlement (x) includes an unconditional release of such Indemnified Person,
in form and substance reasonably satisfactory to such Indemnified Person, from all liability on claims that are the subject matter
of such proceeding and (y) does not include any statement as to or any admission of fault, culpability or a failure to act
by or on behalf of any Indemnified Person.
(d) Contribution.
If the indemnification provided for in paragraphs (a) or (b) above is unavailable to an Indemnified Person or insufficient
in respect of any losses, claims, damages or liabilities referred to therein, then each Indemnifying Person under such paragraph,
in lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by such Indemnified
Person as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company, on the one hand, and the Underwriters on the other, from the offering of the Shares
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) but also the relative fault of the Company, on the one
hand, and the Underwriters, on the other, in connection with the statements or omissions that resulted in such losses, claims,
damages or liabilities, as well as any other relevant equitable considerations. The relative benefits received by the Company,
on the one hand, and the Underwriters on the other, shall be deemed to be in the same respective proportions as the net proceeds
(before deducting expenses) received by the Company from the sale of the Shares and the total underwriting discounts and commissions
received by the Underwriters in connection therewith, in each case as set forth in the table on the cover of the Prospectus, bear
to the aggregate offering price of the Shares. The relative fault of the Company, on the one hand, and the Underwriters on the
other, shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the Underwriters
and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or
omission.
(e) Limitation
on Liability. The Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to paragraph
(d) above were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose)
or by any other method of allocation that does not take account of the equitable considerations referred to in paragraph (d) above.
The amount paid or payable by an Indemnified Person as a result of the losses, claims, damages and liabilities referred to in paragraph
(d) above shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred
by such Indemnified Person in connection with any such action or claim. Notwithstanding the provisions of paragraphs (d) and
(e), in no event shall an Underwriter be required to contribute any amount in excess of the amount by which the total underwriting
discounts and commissions received by such Underwriter with respect to the offering of the Shares exceeds the amount of any damages
that such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters’
obligations to contribute pursuant to paragraphs (d) and (e) are several in proportion to their respective purchase obligations
hereunder and not joint.
(f) Non-Exclusive
Remedies. The remedies provided for in this Section 7 are not exclusive and shall not limit any rights or remedies which
may otherwise be available to any Indemnified Person at law or in equity.
8. Effectiveness
of Agreement. This Agreement shall become effective as of the date first written above.
9. Termination.
This Agreement may be terminated in the absolute discretion of the Representatives, by notice to the Company, if after the execution
and delivery of this Agreement and on or prior to the Closing Date or, in the case of the Option Shares, prior to the Additional
Closing Date (i) trading generally shall have been suspended or materially limited on or by any of the New York Stock Exchange
or The Nasdaq Stock Market; (ii) trading of any securities issued or guaranteed by the Company shall have been suspended on
any exchange or in any over-the-counter market; (iii) a general moratorium on commercial banking activities shall have been
declared by federal or New York State authorities; or (iv) there shall have occurred any outbreak or escalation of hostilities
or any change in financial markets or any calamity or crisis, either within or outside the United States, that, in the judgment
of the Representatives, is material and adverse and makes it impracticable or inadvisable to proceed with the offering, sale or
delivery of the Shares on the Closing Date or the Additional Closing Date, as the case may be, on the terms and in the manner contemplated
by this Agreement, the Pricing Disclosure Package and the Prospectus.
10. Defaulting
Underwriter.
(a) If,
on the Closing Date or the Additional Closing Date, as the case may be, any Underwriter defaults on its obligation to purchase
the Shares that it has agreed to purchase hereunder on such date, the non-defaulting Underwriters may in their discretion arrange
for the purchase of such Shares by other persons satisfactory to the Company on the terms contained in this Agreement. If, within
36 hours after any such default by any Underwriter, the non-defaulting Underwriters do not arrange for the purchase of such Shares,
then the Company shall be entitled to a further period of 36 hours within which to procure other persons satisfactory to the non-defaulting
Underwriters to purchase such Shares on such terms. If other persons become obligated or agree to purchase the Shares of a defaulting
Underwriter, either the non-defaulting Underwriters or the Company may postpone the Closing Date or the Additional Closing Date,
as the case may be, for up to five full business days in order to effect any changes that in the opinion of counsel for the Company
or counsel for the Underwriters may be necessary in the Registration Statement and the Prospectus or in any other document or arrangement,
and the Company agrees to promptly prepare any amendment or supplement to the Registration Statement and the Prospectus that effects
any such changes. As used in this Agreement, the term “Underwriter” includes, for all purposes of this Agreement unless
the context otherwise requires, any person not listed in Schedule 1 hereto that, pursuant to this Section 10, purchases Shares
that a defaulting Underwriter agreed but failed to purchase.
(b) If,
after giving effect to any arrangements for the purchase of the Shares of a defaulting Underwriter or Underwriters by the non-defaulting
Underwriters and the Company as provided in paragraph (a) above, the aggregate number of Shares that remain unpurchased on
the Closing Date or the Additional Closing Date, as the case may be, does not exceed one-eleventh of the aggregate number of Shares
to be purchased on such date, then the Company shall have the right to require each non-defaulting Underwriter to purchase the
number of Shares that such Underwriter agreed to purchase hereunder on such date plus such Underwriter’s pro rata share (based
on the number of Shares that such Underwriter agreed to purchase on such date) of the Shares of such defaulting Underwriter or
Underwriters for which such arrangements have not been made.
(c) If,
after giving effect to any arrangements for the purchase of the Shares of a defaulting Underwriter or Underwriters by the non-defaulting
Underwriters and the Company as provided in paragraph (a) above, the aggregate number of Shares that remain unpurchased on
the Closing Date or the Additional Closing Date, as the case may be, exceeds one-eleventh of the aggregate amount of Shares to
be purchased on such date, or if the Company shall not exercise the right described in paragraph (b) above, then this Agreement
or, with respect to any Additional Closing Date, the obligation of the Underwriters to purchase Shares on the Additional Closing
Date, as the case may be, shall terminate without liability on the part of the non-defaulting Underwriters. Any termination of
this Agreement pursuant to this Section 10 shall be without liability on the part of the Company, except that the Company
will continue to be liable for the payment of expenses as set forth in Section 11 hereof (other than with respect to the defaulting
underwriter(s)) and except that the provisions of Section 7 hereof shall not terminate and shall remain in effect.
(d) Nothing
contained herein shall relieve a defaulting Underwriter of any liability it may have to the Company or any non-defaulting Underwriter
for damages caused by its default.
11. Payment
of Expenses.
(a) Whether
or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated, the Company will pay or
cause to be paid all costs and expenses incident to the performance of its obligations hereunder, including without limitation,
(i) the costs incident to the authorization, issuance, sale, preparation and delivery of the Shares and any taxes payable
in that connection; (ii) the costs incident to the preparation, printing and filing under the Securities Act of the Registration
Statement, the Preliminary Prospectus, any Issuer Free Writing Prospectus, any Pricing Disclosure Package and the Prospectus (including
all exhibits, amendments and supplements thereto) and the distribution thereof; (iii) the reasonable and documented fees and
expenses of the Company’s counsel and independent accountants; (iv) the fees and expenses incurred in connection with
the registration or qualification and determination of eligibility for investment of the Shares under the laws of such jurisdictions
as the Representatives may designate and the preparation, printing and distribution of a Blue Sky Memorandum (including the related
reasonable and documented fees and expenses of counsel for the Underwriters not to exceed $10,000); (v) the cost of preparing
stock certificates; (vi) the costs and charges of any transfer agent and any registrar; (vii) all expenses and application
fees incurred in connection with any filing with, and clearance of the offering by, FINRA (including the related reasonable and
documented fees and expenses of counsel for the Underwriters not to exceed $15,000; (viii) all expenses incurred by the Company
in connection with any “road show” presentation to potential investors; and (ix) all expenses and application
fees related to the listing of the Shares on the Nasdaq Market.
(b) If
(i) this Agreement is terminated pursuant to Section 9, (ii) the Company for any reason fails to tender the Shares
for delivery to the Underwriters or (iii) the Underwriters decline to purchase the Shares for any reason permitted under this
Agreement, the Company agrees to reimburse the Underwriters for all out-of-pocket costs and expenses (including the fees and expenses
of their counsel) reasonably incurred by the Underwriters in connection with this Agreement and the offering contemplated hereby;
provided, however, that no additional amounts beyond what has been reimbursed pursuant to the foregoing will be owed to
the Underwriters other than under Section 7 hereof. For the avoidance of doubt, it is understood that the Company shall not
pay or reimburse any costs, fees or expenses incurred by any Underwriter that defaults on its obligations to purchase the Shares
pursuant to Section 10 of this Agreement.
12. Persons
Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of and be binding upon the parties hereto and their
respective successors and the officers and directors and any controlling persons referred to herein, and the affiliates of each
Underwriter referred to in Section 7 hereof. Nothing in this Agreement is intended or shall be construed to give any other
person any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein. No
purchaser of Shares from any Underwriter shall be deemed to be a successor merely by reason of such purchase.
13. Survival.
The respective indemnities, rights of contribution, representations, warranties and agreements of the Company and the Underwriters
contained in this Agreement or made by or on behalf of the Company or the Underwriters pursuant to this Agreement or any certificate
delivered pursuant hereto shall survive the delivery of and payment for the Shares and shall remain in full force and effect, regardless
of any termination of this Agreement or any investigation made by or on behalf of the Company or the Underwriters or the directors,
officers, controlling persons or affiliates referred to in Section 7 hereof.
14. Certain
Defined Terms. For purposes of this Agreement, (a) except where otherwise expressly provided, the term “affiliate”
has the meaning set forth in Rule 405 under the Securities Act; (b) the term “business day” means any day
other than a day on which banks are permitted or required to be closed in New York City; and (c) the term “subsidiary”
has the meaning set forth in Rule 405 under the Securities Act.
15. Compliance
with USA Patriot Act. In accordance with the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)), the Underwriters are required to obtain, verify and record information that identifies their respective
clients, including the Company, which information may include the name and address of their respective clients, as well as other
information that will allow the Underwriters to properly identify their respective clients.
16. Miscellaneous.
(a) Notices.
All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted
and confirmed by any standard form of telecommunication. Notices to the Underwriters shall be given to the Representatives: c/o
X.X. Xxxxxx Securities LLC, 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (fax: (000) 000-0000) and c/x Xxxxxxxxx LLC, 000 Xxxxxxx
Xxxxxx, Xxx Xxxx, XX 00000; Attention Equity Syndicate Desk. Notices to the Company shall be given to it at Surgery Partners, Inc.,
000 Xxxxx Xxxxxxx Xxx, Xxxxx 000, Xxxxxxxxx, Xxxxxxxxx, 00000, Attention: General Counsel, with a copy to: Ropes &
Xxxx LLP, Three Embarcadero Center, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000 Attention: L. Xxxxxx Xxxxxx, Esq.
(b) Governing
Law. This Agreement and any claim, controversy or dispute arising under or related to this Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
(c) Submission
to Jurisdiction. The Company hereby submits to the exclusive jurisdiction of the U.S. federal and New York state courts in
the Borough of Manhattan in The City of New York in any suit or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby. The Company waives any objection which it may now or hereafter have to the laying of venue of
any such suit or proceeding in such courts. The Company agrees that final judgment in any such suit, action or proceeding brought
in such court shall be conclusive and binding upon the Company and may be enforced in any court to the jurisdiction of which Company
is subject by a suit upon such judgment.
(f) Waiver
of Jury Trial. Each of the parties hereto hereby waives any right to trial by jury in any suit or proceeding arising out of
or relating to this Agreement.
(g) Recognition
of the U.S. Special Resolution Regimes.
(i) In the event that any
Underwriter that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from
such Underwriter of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent
as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation,
were governed by the laws of the United States or a state of the United States.
(ii) In the event that any
Underwriter that is a Covered Entity or a BHC Act Affiliate of such Underwriter becomes subject to a proceeding under a U.S. Special
Resolution Regime, Default Rights under this Agreement that may be exercised against such Underwriter are permitted to be exercised
to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were
governed by the laws of the United States or a state of the United States.
As used in this Section 16(g):
“BHC Act Affiliate”
has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. §
1841(k).
“Covered Entity” means
any of the following:
(i) a “covered entity”
as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b);
(ii) a “covered bank”
as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or
(iii) a “covered FSI”
as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).
“Default Right” has
the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1,
as applicable.
“U.S. Special Resolution Regime”
means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the
Xxxx-Xxxxx Xxxx Street Reform and Consumer Protection Act and the regulations promulgated thereunder.
(h) Counterparts.
This Agreement may be signed in counterparts (which may include counterparts delivered by any standard form of telecommunication),
each of which shall be an original and all of which together shall constitute one and the same instrument.
(i) Amendments
or Waivers. No amendment or waiver of any provision of this Agreement, nor any consent or approval to any departure therefrom,
shall in any event be effective unless the same shall be in writing and signed by the parties hereto.
(j) Headings.
The headings herein are included for convenience of reference only and are not intended to be part of, or to affect the meaning
or interpretation of, this Agreement.
If the foregoing is in accordance with your
understanding, please indicate your acceptance of this Agreement by signing in the space provided below.
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Very truly yours, |
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SURGERY PARTNERS, INC. |
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By: |
/s/ Xxxxxx X. Xxxxxx |
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Name: Xxxxxx X. Xxxxxx |
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Title: Executive Vice President and Chief Financial Officer |
[Signature Page to
Underwriting Agreement]
Accepted: As of the date first written above |
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X.X. XXXXXX SECURITIES LLC |
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XXXXXXXXX LLC |
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For themselves and on behalf of the |
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several Underwriters listed |
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in Schedule 1 hereto. |
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X.X. XXXXXX SECURITIES LLC |
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By: |
/s/ Xxxx Xxxxxx |
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Authorized Signatory |
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XXXXXXXXX LLC |
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By: |
/s/ Xxxx Xxxxx |
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Authorized Signatory |
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Schedule 1
Underwriter | |
Number of Shares | |
X.X. Xxxxxx Securities LLC | |
| 2,096,042 | |
Xxxxxxxxx LLC | |
| 2,096,042 | |
Barclays Capital Inc. | |
| 1,891,250 | |
KKR Capital Markets LLC | |
| 850,000 | |
Macquarie Capital (USA) Inc. | |
| 566,666 | |
Total | |
| 7,500,000 | |
Schedule 2
Significant Subsidiaries
[Attached.]
Schedule 3
Joint Ventures
[Attached.]
Annex
A
| a. | Pricing Disclosure Package |
None.
| b. | Pricing Information
Provided Orally by Underwriters |
Underwritten Shares: 7,500,000
Option Shares: 1,125,000
Public Offering Price Per Share: $30.25
Annex B
[Reserved]
Exhibit A
FORM OF LOCK-UP AGREEMENT
[Attached.]