CVS CAREMARK CORPORATION $1,750,000,000 Floating Rate Senior Notes due June 1, 2010 $1,750,000,000 5.750% Senior Notes due June 1, 2017 $1,000,000,000 6.250% Senior Notes due June 1, 2027 Underwriting Agreement
Exhibit
1.1
Execution
Copy
CVS
CAREMARK CORPORATION
$1,750,000,000
Floating Rate Senior Notes due June 1, 2010
$1,750,000,000
5.750% Senior Notes due June 1, 2017
$1,000,000,000
6.250% Senior Notes due June 1, 2027
Underwriting
Agreement
May
22,
2007
XXXXXX
BROTHERS INC.
XXXXXX
XXXXXXX & CO. INCORPORATED
BANC
OF
AMERICA SECURITIES LLC
BNY
CAPITAL MARKETS, INC. AND
WACHOVIA
CAPITAL MARKETS, LLC
As
Representatives of the several Underwriters
named
in
Schedule I hereto
c/x
Xxxxxx
Brothers Inc.
000
Xxxxxxx Xxxxxx
Ladies
and
Gentlemen:
CVS
Caremark Corporation, a Delaware corporation (the “Company”),
proposes to issue and sell $1,750,000,000 aggregate principal amount of its
Floating Rate Senior Notes due 2010 (the “Floating Rate
Notes”), $1,750,000,000 aggregate principal amount of its 5.750% Senior
Notes due 2017 (the “2017 Notes”) and $1,000,000,000 aggregate
principal amount of its 6.250% Senior Notes due 2027 (the “2027
Notes” and, together with the Floating Rate Notes and the 2017 Notes,
the “Notes”) to the several underwriters named on Schedule I
hereto (the “Underwriters”), for which Xxxxxx Brothers Inc.,
Xxxxxx Xxxxxxx & Co. Incorporated, Banc of America Securities LLC, BNY
Capital Markets, Inc. and Wachovia Capital Markets, LLC are acting as
representatives (the “Representatives”). The Notes will (i)
have terms and provisions which are summarized in the Disclosure Package as
of
the Applicable Time and the Prospectus dated as of the date hereof (each as
defined in Section 1(a) hereof) and (ii) be issued pursuant to an Indenture
dated as of August 15, 2006 (the “Indenture”) between the
Company and The Bank of New York Trust Company, N.A., as Trustee (the
“Trustee”). This agreement (this “Agreement”)
is to confirm the agreement concerning the purchase of the Notes from the
Company by the Underwriters.
1.
Representations, Warranties and Agreements of the Company. The Company
represents and warrants to, and agrees with, each Underwriter that:
(a)
An
“automatic shelf registration statement” (as defined in Rule 405 under the
Securities Act of 1933, as amended (the “Securities Act”)) on
Form S-3 in respect of the Notes (File No. 333-143110) (i) has been prepared
by
the Company in conformity with the requirements of the Securities Act, and
the
rules and regulations (the “Rules and Regulations”) of the
Securities and Exchange Commission (the “Commission”)
thereunder, (ii) has been filed with the Commission under the Securities Act
not
earlier than the date that is three years prior to the Closing Date (as defined
in Section 3 hereof) and (iii) upon its filing with the Commission,
automatically became and is effective under the Securities Act. Copies of such
registration statement and any amendment thereto (excluding exhibits to such
registration statement but including all documents incorporated by reference
in
each prospectus contained therein) have been delivered by the Company to the
Representatives; and no other document with respect to such registration
statement or any such document incorporated by reference therein has heretofore
been filed or transmitted for filing with the Commission. For purposes of this
Agreement, the following terms have the specified meanings:
“Applicable
Time” means 5:00 p.m. (New York City time) on the date of this
Agreement;
“Base
Prospectus” means the base prospectus filed as part of the Registration
Statement, in the form in which it has most recently been amended on or prior
to
the date hereof, relating to the Notes;
“Disclosure
Package” means, as of the Applicable Time, the most recent Preliminary
Prospectus, together with each Issuer Free Writing Prospectus filed or used
by
the Company on or before the Applicable Time and identified on Schedule II
hereto, other than a road show that is an Issuer Free Writing Prospectus under
Rule 433 of the Rules and Regulations;
“Effective
Date” means any date as of which any part of the Registration Statement
or any post-effective amendment thereto relating to the Notes became, or is
deemed to have become, effective under the Securities Act in accordance with
the
Rules and Regulations (including pursuant to Rule 430B of the Rules and
Regulations);
“Final
Term Sheet” means the term sheet prepared pursuant to Section 4(a) of
the Agreement and substantially in the form attached in Schedule III
hereto;
“Issuer
Free Writing Prospectus” means each “free writing prospectus” (as
defined in Rule 405 of the Rules and Regulations) prepared by or on behalf
of
the Company or used or referred to by the Company in connection with the
offering of the Notes, including the Final Term Sheet;
“Preliminary
Prospectus” means any preliminary prospectus relating to the Notes,
including the Base Prospectus and any preliminary prospectus supplement thereto,
included in the Registration Statement or as filed with the Commission pursuant
to Rule 424(b) of the Rules and Regulations and provided to the Representatives
for use by the Underwriters;
“Prospectus”
means the final prospectus relating to the Notes, including the Base Prospectus
and the final prospectus supplement thereto relating to the Notes, as filed
with
the Commission pursuant to Rule 424(b) of the Rules and Regulations and provided
to the Representatives for use by the Underwriters; and
“Registration
Statement” means, collectively, the various parts of the
above-referenced registration statement, each as amended as of the Effective
Date for such part, including any Preliminary Prospectus and the Prospectus,
all
exhibits to such registration statement and all documents incorporated by
reference therein.
Any
reference to the “most recent Preliminary Prospectus” will be
deemed to refer to the latest Preliminary Prospectus included in the
Registration Statement or filed pursuant to Rule 424(b) of the Rules and
Regulations prior to or on the date hereof (including, for purposes of this
Agreement, any documents incorporated by reference therein prior to or on the
date of this Agreement). Any reference to any Preliminary Prospectus or the
Prospectus will be deemed to refer to and include any documents incorporated
by
reference therein pursuant to Form S-3 under the Securities Act as of the date
of such Preliminary Prospectus or the Prospectus, as the case may be. Any
reference to any amendment or supplement to any Preliminary Prospectus or the
Prospectus will be deemed to refer to and include any document filed under
the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”), after the date of such Preliminary Prospectus or the Prospectus,
as the case may be, and incorporated by reference in such Preliminary Prospectus
or the Prospectus, as the case may be; and any reference to any amendment to
the
Registration Statement will be deemed to include any annual report of the
Company on Form 10-K filed with the Commission pursuant to Section 13(a) or
15(d) of the Exchange Act after the Effective Date that is incorporated by
reference in the Registration Statement.
(b)
The
Commission has not issued any order preventing or suspending the effectiveness
of the Registration Statement or preventing or suspending the use of any
Preliminary Prospectus, any Issuer Free Writing Prospectus or the Prospectus;
and no proceeding for any such purpose or pursuant to Section 8A of the
Securities Act against the Company or related to the offering has been
instituted or, to the Company’s knowledge, threatened by the Commission. The
Commission has not issued any order directed to any document incorporated by
reference in the most recent Preliminary Prospectus or the Prospectus, and
no
proceeding has been instituted
2
or,
to the
Company’s knowledge, threatened by the Commission with respect to any document
incorporated by reference in the most recent Preliminary Prospectus or the
Prospectus. The Commission has not notified the Company of any objection to
the
use of the form of the Registration Statement.
(c)
The
Company is a “well-known seasoned issuer” (as defined in Rule 405 of the Rules
and Regulations) and has not been, and continues not to be, an “ineligible
issuer” (as defined in Rule 405 of the Rules and Regulations), in each case at
all times relevant under the Securities Act in connection with the offering
of
the Notes.
(d)
The
Registration Statement conformed on the Effective Date and any amendment to
the
Registration Statement filed after the date hereof will conform, in all material
respects, to the requirements of the Securities Act and the Rules and
Regulations. The most recent Preliminary Prospectus conforms on the date hereof,
and the Prospectus, and any amendment or supplement thereto, will conform as
of
its date and as of the Closing Date, in all material respects, to the
requirements of the Securities Act and the Rules and Regulations. The documents
incorporated by reference in the most recent Preliminary Prospectus or the
Prospectus conformed, and any further documents so incorporated will conform,
when filed with the Commission, in all material respects to the requirements
of
the Exchange Act or the Securities Act, as applicable, and the Rules and
Regulations; and. no such documents have been filed with the Commission since
the close of business of the Commission on the Business Day immediately prior
to
the date hereof.
(e)
The
Registration Statement does not, as of the date hereof, contain any untrue
statement of a material fact or omit to state any material fact required to
be
stated therein or necessary to make the statements therein not misleading;
provided, however, that no representation or warranty is made as to
information contained in or omitted from the Registration Statement in reliance
upon and in conformity with written information furnished to the Company through
the Representatives by or on behalf of any Underwriter specifically for
inclusion therein (which information is specified in Section 12
hereof).
(f)
The
Disclosure Package did not, as of the Applicable Time, contain any untrue
statement of a material fact or omit to state any material fact required to
be
stated therein or necessary to make the statements therein, in the light of
the
circumstances under which they were made, not misleading; provided,
however, that no representation or warranty is made as to information
contained in or omitted from the Disclosure Package in reliance upon and in
conformity with written information furnished to the Company through the
Representatives by or on behalf of any Underwriter specifically for inclusion
therein (which information is specified in Section 12 hereof).
(g)
The
Prospectus, and any amendment or supplement thereto, will not, as of its date
and on the Closing Date, contain any untrue statement of a material fact or
omit
to state any material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they
were
made, not misleading; provided, however, that no representation or
warranty is made as to information contained in or omitted from the Prospectus
in reliance upon and in conformity with written information furnished to the
Company through the Representatives by or on behalf of any Underwriter
specifically for inclusion therein (which information is specified in Section
12
hereof).
(h)
The
documents incorporated by reference in any Preliminary Prospectus or the
Prospectus did not, and any further documents incorporated by reference therein
will not, when filed with the Commission, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
(i)
The
Company has been duly incorporated and is an existing corporation in good
standing under the laws of the State of Delaware, with corporate power and
authority to own its properties and conduct its business as described in the
most recent Preliminary Prospectus and the Prospectus; and the Company is duly
qualified to do business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the conduct of
its
business requires such qualification, except where the failure to be so
qualified or be in good standing would not have a material adverse effect on
the
financial condition, business, properties, results of operations or affairs
of
the Company and its subsidiaries taken as a whole (a “Material Adverse
Effect”).
3
(j)
Each
subsidiary of the Company that is material to the Company and its subsidiaries
taken as a whole (collectively, the “Significant Subsidiaries”)
is listed on Exhibit A hereto, together with its jurisdiction of
organization and the beneficial ownership of the Company therein. Each
Significant Subsidiary has been duly organized and is an existing corporation
or
limited liability company in good standing under the laws of the jurisdiction
of
its formation, with corporate power and authority to own its properties and
conduct its business as described in the most recent Preliminary Prospectus
and
the Prospectus; and each Significant Subsidiary of the Company is duly qualified
to do business as a foreign entity in good standing in all other jurisdictions
in which its ownership or lease of property or the conduct of its business
requires such qualification, except where the failure to be so qualified or
in
good standing would not have a Material Adverse Effect; all of the issued and
outstanding capital stock or membership interests of each Significant Subsidiary
of the Company has been duly authorized and validly issued and is fully paid
and
nonassessable; and the capital stock of each Significant Subsidiary owned by
the
Company, directly or through subsidiaries, is owned, except to the extent set
forth in Schedule B hereto, free and clear of any mortgage, pledge, lien,
security interest, claim, encumbrance or defect of any kind.
(k)
This
Agreement has been duly authorized, executed and delivered by the
Company.
(l)
The
Indenture has been duly authorized by the Company and, assuming due
authorization by the Trustee, when duly executed and delivered by the Company
and the Trustee, will constitute a valid and legally binding obligation of
the
Company, enforceable against the Company in accordance with its terms, except
to
the extent that enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to creditors’ rights
and remedies generally and by general principles of equity and concepts of
reasonableness (regardless of whether enforcement is sought in a proceeding
at
law or in equity); and the Indenture conforms in all material respects to the
description thereof contained in the most recent Preliminary Prospectus and
the
Prospectus.
(m)
The
Notes have been duly authorized by the Company, and when executed, authenticated
and delivered and paid for as provided in this Agreement and the Indenture,
the
Notes will have been duly executed, authenticated, issued and delivered and
will
constitute valid and legally binding obligations of the Company entitled to
the
benefits of the Indenture and enforceable against the Company in accordance
with
their terms, except to the extent that enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to creditors’ rights and remedies generally and by general principles
of equity and concepts of reasonableness (regardless of whether enforcement
is
sought in a proceeding at law or in equity); and the Notes conform in all
material respects to the description thereof contained in the Disclosure Package
and the Prospectus.
(n)
The
execution, delivery and performance of the Indenture and this Agreement and
the
issuance and sale of the Notes will not require the consent, approval,
authorization, or order of, or filing with, any governmental agency or body
or
any court (except such as have been obtained or made and such as may be required
under state securities laws).
(o)
The
execution, delivery and performance of the Indenture and this Agreement and
the
issuance and sale of the Notes and compliance with the terms and provisions
thereof will not conflict with or result in a breach or violation of any of
the
terms and provisions of, and do not and will not constitute a default (or an
event which with the giving of notice or the lapse of time or both would
constitute a default) under, or result in the creation or imposition of any
lien, charge or encumbrance upon any material assets or properties of the
Company or any of its subsidiaries under (A) the charter, by-laws or other
organizational documents of the Company or any Significant Subsidiary, (B)
any
statute, any rule, regulation, order or decree of any governmental or regulatory
agency or body or any court, domestic or foreign, having jurisdiction over
the
Company or any subsidiary or any of their properties, assets or operations,
or
(C) any indenture, mortgage, loan or credit agreement, note, lease, permit,
license or other agreement or instrument to which the Company or any subsidiary
is a party or by which the Company or any subsidiary is bound or to which any
of
the properties, assets or operations of the Company or any subsidiary is
subject, except, in the case of clauses (B) and (C), for such breaches or
violations which would not have a Material Adverse Effect.
(p)
The
Company and its subsidiaries have good and marketable title to all real
properties owned by them, in each case free and clear of any mortgage, pledge,
lien, security interest, claim or other
4
encumbrance
or defect; the Company and its subsidiaries hold any leased real property under
valid, subsisting and enforceable leases or subleases with no exceptions that
would materially interfere with the use made or to be made thereof by them;
neither the Company nor any of its subsidiaries is in material default under
any
such lease or sublease; and no material claim of any sort has been asserted
by
anyone adverse to the rights of the Company or any subsidiary under any such
lease or sublease or affecting or questioning the right of such entity to the
continued possession of the leased or subleased properties under any such lease
or sublease, except in each case as would not, individually or in the aggregate,
have a Material Adverse Effect.
(q)
Except
as described in the most recent Preliminary Prospectus and the Prospectus,
the
Company and its subsidiaries possess adequate certificates, authorizations,
licenses or permits issued by appropriate governmental agencies or bodies
necessary to conduct the business now operated by them, except as would not
have
a Material Adverse Effect, and have not received any notice of proceedings
relating to the revocation or modification of any such certificate,
authorization, license or permit that, individually or in the aggregate, could
have a Material Adverse Effect.
(r)
The
Company and each of its subsidiaries have filed all tax returns required to
be
filed, which returns are complete and correct in all material respects, and
neither the Company nor any of its subsidiaries is in default in the payment
of
any taxes which were payable pursuant to said returns or any assessments with
respect thereto, in each case except as would not, individually or in the
aggregate, have a Material Adverse Effect.
(s)
Neither the filing of the Registration Statement, the most recent Preliminary
Prospectus or the Prospectus nor the offer or sale of the Notes as contemplated
by this Agreement gives rise to any rights, other than those which have been
duly waived or satisfied, for or relating to the registration of any securities
of the Company.
(t)
Except
as described in the most recent Preliminary Prospectus and the Prospectus (A)
neither the Company nor any of its Significant Subsidiaries is in violation
of
its charter or by-laws, (B) neither the Company nor any of its subsidiaries
is
in violation of any applicable law, ordinance, administrative or governmental
rule or regulation, or any order, decree or judgment of any court or
governmental agency or body having jurisdiction over the Company or any of
its
subsidiaries and (C) no event of default or event that, but for the giving
of
notice or the lapse of time or both, would constitute an event of default,
exists, or as a result of the consummation of the sale of the Notes will exist,
under any indenture, mortgage, loan agreement, note, lease, permit, license
or
other agreement or instrument to which the Company or any of its subsidiaries
is
a party or to which any of the properties, assets or operations of the Company
or any such Subsidiary is subject, except, in the case of clauses (B) and (C),
for such violations and defaults that would not have a Material Adverse
Effect.
(u)
Except
as described in the most recent Preliminary Prospectus and the Prospectus,
there
are no pending actions, suits or proceedings against or, to the knowledge of
the
Company, affecting the Company, any of its subsidiaries or any of their
respective properties, assets or operations that would have, individually or
in
the aggregate, a Material Adverse Effect, or could materially and adversely
affect the ability of the Company to perform its obligations under this
Agreement, the Indenture or any other document governing the sale of the Notes;
and no such actions, suits or proceedings are, to the knowledge of the Company,
threatened.
(v)
The
financial statements, together with the related schedules and notes included
or
incorporated by reference in the most recent Preliminary Prospectus and the
Prospectus, present fairly, in all material respects, the respective financial
position of the Company and its consolidated subsidiaries and Caremark Rx,
Inc.,
as applicable, as of the dates shown and their results of operations and cash
flows for the periods shown, and have been prepared in conformity with generally
accepted accounting principles in the United States applied on a consistent
basis, except as disclosed therein. The other financial and statistical
information set forth in the most recent Preliminary Prospectus and the
Prospectus present fairly, in all material respects, the information shown
therein and have been, except as disclosed therein, compiled on a basis
consistent with that of the financial statements included or incorporated by
reference in the most recent Preliminary Prospectus and the
Prospectus.
(w)
The
pro forma financial statements included or incorporated by reference in the
most
recent Preliminary Prospectus include assumptions that provide a reasonable
basis for presenting the significant effects directly attributable to the
transactions and events described therein, the related pro forma adjustments
give
5
appropriate
effect to those assumptions, and the pro forma adjustments reflect the proper
application of those adjustments to the historical financial statement amounts
in the pro forma financial statements included or incorporated by reference
in
the most recent Preliminary Prospectus. The pro forma financial statements
included or incorporated by reference in the most recent Preliminary Prospectus
comply as to form in all material respects with the applicable requirements
of
Regulation S-X under the Act.
(x)
Since
the date of the latest audited financial statements of the Company included
or
incorporated by reference in the Preliminary Prospectus and the Prospectus,
there has been no material adverse change, nor any development or event
involving a prospective material adverse change, in the financial condition,
business, properties or results of operations of the Company and its
subsidiaries taken as a whole.
(y)
There
is no contract or document required to be described in the Registration
Statement, any Preliminary Prospectus or the Prospectus or to be filed as an
exhibit to the Registration Statement or to a document incorporated by reference
into the Registration Statement, any Preliminary Prospectus or the Prospectus
which is not described or filed as required.
(z)
The
Company is not and, after giving effect to the offering and sale of the Notes
and the application of the proceeds thereof as described in the most recent
Preliminary Prospectus and the Prospectus will not be required to register
as,
an “investment company” as defined in the Investment Company Act of 1940, as
amended.
(aa)
Each
of the Company and its Significant Subsidiaries maintains a system of internal
accounting controls over financial reporting. The Company's internal controls
over financial reporting includes those policies and procedures that pertain
to
the Company's ability to record, process, summarize and report a system of
internal accounting controls and procedures to provide reasonable assurance,
at
an appropriate cost/benefit relationship, that the unauthorized acquisition,
use
or disposition of assets are prevented or timely detected and that transactions
are authorized, recorded and reported properly to permit the preparation of
financial statements in accordance with generally accepted accounting principles
and receipts and expenditures are duly authorized. The Company’s internal
controls over financial reporting were effective and provided such reasonable
assurance for the preparation of financial statements as of December 30, 2006
and, to the best of the Company’s knowledge, there have been no changes in the
Company’s internal controls over financial reporting subsequent to December 30,
2006.
(bb)
The
Company has made the evaluations of the Company’s disclosure controls and
procedures required under Rule 13a 15(b) under the Exchange Act and management’s
conclusions regarding the effectiveness of such disclosure controls and
procedures were included in the Company’s annual report on Form 10-K for the
fiscal year ended December 30, 2006.
For
purposes of this Section 1, as well as for Section 6 hereof, references to
“the
most recent Preliminary Prospectus and the Prospectus” or “the Disclosure
Package and the Prospectus” are to each of the most recent Preliminary
Prospectus or the Disclosure Package, as the case may be, and the Prospectus
as
separate or stand-alone documentation (and not the most recent Preliminary
Prospectus or the Disclosure Package, as the case may be, and the Prospectus
taken together), so that representations, warranties, agreements, conditions
and
legal opinions will be made, given or measured independently in respect of
each
of the most recent Preliminary Prospectus or the Disclosure Package, as the
case
may be, and the Prospectus.
2.
Purchase of the Notes by the Underwriters. Subject to the terms and
conditions and upon the basis of the representations and warranties herein
set
forth, the Company agrees to issue and sell to the Underwriters, and each of
the
Underwriters agrees, severally and not jointly, to purchase from the Company,
at
a price equal to 99.600% of the principal amount of the Floating Rate Notes,
98.301% of the principal amount of the 2017 Notes and 98.211% of the principal
amount of the 2027 Notes, plus, in each case, accrued interest, if any, from
May
25, 2007 to the Closing Date, the respective principal amount of the Notes
set
forth opposite such Underwriter’s name in Schedule I hereto.
3.
Delivery of and Payment for the Notes. Delivery of the Notes will be
made at the offices of Xxxxx Xxxxxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx
Xxxx, XX 00000, or at such place or places as mutually may be agreed upon by
the
Company and the Underwriters, at 9:00 A.M., New York City time, on
May
6
25,
2007
or on such later date not more than seven Business Days after such date as
may
be determined by the Representatives and the Company (the “Closing
Date”).
Delivery
of the Notes will be made to the Representatives by or on behalf of the Company
against payment of the purchase price therefor by wire transfer of immediately
available funds. Delivery of the Notes will be made through the facilities
of
The Depository Trust Company unless the Representatives will otherwise instruct.
Delivery of the Notes at the time and place specified in this Agreement is
a
further condition to the obligations of each Underwriter.
4.
Covenants of the Company. The Company covenants and agrees with each
Underwriter that:
(a)
The
Company (i) will prepare the Prospectus in a form approved by the
Representatives and file the Prospectus pursuant to Rule 424(b) of the Rules
and
Regulations within the time period prescribed by such Rule; (ii) will not file
any amendment or supplement to the Registration Statement or the Prospectus
or
file any document under the Exchange Act (except for filings of annual reports
on Form 10-K and quarterly reports on Form 10-Q under the Exchange Act) before
the termination of the offering of the Notes by the Underwriters if such
document would be deemed to be incorporated by reference into the Prospectus,
which filing is not consented to by the Representatives after reasonable notice
thereof (such consent not to be unreasonably withheld or delayed); (iii) will
advise the Representatives, promptly after it receives notice thereof, of the
time when any amendment or supplement to the Registration Statement, the most
recent Preliminary Prospectus or the Prospectus has been filed and will furnish
the Representatives with copies thereof; (iv) will prepare the Final Term Sheet,
substantially in the form of Schedule III hereto and approved by the
Representatives and file the Final Term Sheet pursuant to Rule 433(d) of the
Rules and Regulations within the time period prescribed by such Rule; (v) will
advise the Representatives promptly after it receives notice thereof, of the
issuance by the Commission or any state or other regulatory body of any stop
order or any order suspending the effectiveness of the Registration Statement,
suspending or preventing the use of any Preliminary Prospectus, the Prospectus
or any Issuer Free Writing Prospectus or suspending the qualification of the
Notes for offering or sale in any jurisdiction, of the initiation or threatening
of any proceedings for any such purpose or pursuant to Section 8A of the
Securities Act, of receipt by the Company from the Commission of any notice
of
objection to the use of the Registration Statement or any post-effective
amendment thereto or of any request by the Commission for the amending or
supplementing of the Registration Statement, the Prospectus or any Issuer Free
Writing Prospectus or for additional information; and (vi) will use its
reasonable best efforts to prevent the issuance of any stop order or other
such
order or any such notice of objection and, if a stop order or other such order
is issued or any such notice of objection is received, to obtain as soon as
possible the lifting or withdrawal thereof.
(b)
The
Company will furnish to each of the Underwriters and to counsel for the
Underwriters such number of conformed copies of the Registration Statement,
as
originally filed and each amendment thereto (excluding exhibits other than
this
Agreement), any Preliminary Prospectus, the Final Term Sheet and any other
Issuer Free Writing Prospectus, the Prospectus and all amendments and
supplements to any of such documents (including any document filed under the
Exchange Act and deemed to be incorporated by reference in the Registration
Statement, any Preliminary Prospectus or the Prospectus), in each case as soon
as available and in such quantities as the Representatives may from time to
time
reasonably request.
(c)
During
the period in which the Prospectus relating to the Notes (or in lieu thereof,
the notice referred to in Rule 173(a) of the Rules and Regulations) is required
to be delivered under the Securities Act, the Company will comply with all
requirements imposed upon it by the Securities Act and by the Rules and
Regulations, as from time to time in force, so far as is necessary to permit
the
continuance of sales of or dealings in the Notes as contemplated by the
provisions of this Agreement and by the Prospectus. If during such period any
event occurs as a result of which the Prospectus as then amended or supplemented
would include an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if during such
period it is necessary to amend the Registration Statement or amend or
supplement the Prospectus or file any document to comply with the Securities
Act, the Company will promptly notify the Representatives and will, subject
to
Section 4(a) hereof, amend the Registration Statement, or amend or supplement
the Prospectus, as the case may be, or file any document (in each case, at
the
expense of the Company) so as to correct such statement or omission or to effect
such compliance, and will furnish without charge to each Underwriter as many
written and electronic copies of
7
any
such
amendment or supplement as the Representatives may from time to time reasonably
request. Neither the Representatives’ consent to nor its delivery to offerees or
investors of, any such amendment or supplement shall constitute a waiver of
any
of the conditions set forth in Section 6 of this Agreement.
(d)
As
soon as practicable, the Company will make generally available to its security
holders and the Underwriters an earnings statement satisfying the requirements
of Section 11(a) of the Securities Act and Rule 158 of the Rules and
Regulations.
(e)
The
Company agrees, whether or not this Agreement becomes effective or is terminated
or the sale of the Notes to the Underwriters is consummated, to pay all fees,
expenses, costs and charges in connection with: (i) the preparation, printing,
filing, registration, delivery and shipping of the Registration Statement
(including any exhibits thereto), any Preliminary Prospectus, any Issuer Free
Writing Prospectus, the Prospectus and any amendments or supplements thereto;
(ii) the printing, producing, copying and delivering of this Agreement, the
Indenture, closing documents (including any compilations thereof) and any other
agreements, memoranda, correspondence and other documents printed and delivered
in connection with the offering, purchase, sale and delivery of the Notes;
(iii)
the services of the Company’s independent registered public accounting firm;
(iv) the services of the Company’s counsel; (v) the qualification of the Notes
under the securities laws of the several jurisdictions as provided in Section
4(i) hereof; (vi) any rating of the Notes by rating agencies; (vii) the services
of the Trustee and any agent of the Trustee (including the fees and
disbursements of counsel for the Trustee); (viii) any “road show” or other
investor presentations relating to the offering of the Notes (including, without
limitation, for meetings and travel); and (ix) otherwise incident to the
performance of its obligations hereunder for which provision is not otherwise
made in this Section 4(e). It is understood, however, that, except as provided
in this Section 4(e) or Sections 7 and 9 hereof, the Underwriters will pay
all
of their own costs and expenses, including the fees and expenses of counsel
to
the Underwriters and any advertising expenses incurred in connection with the
offering of the Notes. If the sale of the Notes provided for herein is not
consummated by reason of acts of the Company or changes in circumstances of
the
Company pursuant to Section 9 of this Agreement which prevent this Agreement
from becoming effective, or by reason of any failure, refusal or inability
on
the part of the Company to perform any agreement on its part to be performed
or
because any other condition of the Underwriters’ obligations hereunder is not
fulfilled or if the Underwriters decline to purchase the Notes for any reason
permitted under this Agreement (other than by reason of a default by any of
the
Underwriters pursuant to Section 8 or if the Underwriters terminate this
Agreement under Section 9 of this Agreement upon the occurrence of any event
specified in clause (iii), (iv), (vi), (vii) or (viii) of Section 6(f)), the
Company will reimburse the Underwriters for all reasonable out-of-pocket
disbursements (including fees and expenses of counsel to the Underwriters)
incurred by the Underwriters in connection with any investigation or preparation
made by them in respect of the marketing of the Notes or in contemplation of
the
performance by them of their obligations hereunder.
(f)
Until
termination of the offering of the Notes, the Company will timely file all
reports, documents and amendments to previously filed documents required to
be
filed by it pursuant to Section 12, 13(a), 13(c), 14 or 15(d) of the Exchange
Act.
(g)
The
Company will apply the net proceeds from the sale of the Notes as set forth
in
the most recent Preliminary Prospectus and the Prospectus under the caption
“Use
of Proceeds.”
(h)
The
Company will pay the required Commission filing fees relating to the Notes
within the time period required by Rule 456(b)(1) of the Rules and Regulations
without regard to the proviso therein and otherwise in accordance with Rules
456(b) and 457(r) of the Rules and Regulations.
(i)
The
Company will use reasonable best efforts to arrange for the qualification of
the
Notes and the determination of their eligibility for investment under the blue
sky laws of such jurisdictions as the Representatives designate and will
continue such qualifications in effect so long as required for the distribution
of the Notes by the Underwriters, provided that the Company will not be required
to qualify as a foreign corporation or to file a general consent to service
of
process or subject itself to taxation in any such state.
8
5.
Free Writing Prospectuses.
(a)
The
Company represents and warrants to, and agrees with, each Underwriter that
(i)
the Company has not made, and will not make, any offer relating to the Notes
that would constitute an Issuer Free Writing Prospectus without the prior
consent of the Representatives (which consent being deemed to have been given
with respect to (A) the Final Term Sheet prepared and filed pursuant to Section
4(a) hereof and (B) any other Issuer Free Writing Prospectus identified on
Schedule II hereto); (ii) each Issuer Free Writing Prospectus conformed or
will
conform in all material respects to the requirements of the Securities Act
and
the Rules and Regulations on the date of first use, and the Company has complied
with any filing requirements applicable to such Issuer Free Writing Prospectus
pursuant to Rule 433 of the Rules and Regulations; (iii) each Issuer Free
Writing Prospectus will not, as of its issue date and through the time the
Notes
are delivered pursuant to Section 3 hereof, include any information that
conflicts with the information contained in the Registration Statement, the
most
recent Preliminary Prospectus and the Prospectus; and (iv) each Issuer Free
Writing Prospectus, when considered together with the information contained
in
the most recent Preliminary Prospectus, did not, as of the Applicable Time,
does
not, as of the date hereof, and will not, as of the Closing Date, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading.
(b)
Each
Underwriter represents and warrants to, and agrees with, the Company and each
other Underwriter that it has not made, and will not make any offer relating
to
the Notes that would constitute a “free writing prospectus” (as defined in Rule
405 of the Rules and Regulations) required to be filed with the Commission,
without the prior consent of the Company and the Representatives.
(c)
The
Company agrees that if at any time following issuance of an Issuer Free Writing
Prospectus any event occurred or occurs as a result of which such Issuer Free
Writing Prospectus would conflict with the information in the Registration
Statement, the most recent Preliminary Prospectus or the Prospectus or 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 then prevailing, not misleading, the Company will give prompt
notice thereof to the Representatives and, if requested by the Representatives,
will prepare and furnish without charge to each Underwriter an Issuer Free
Writing Prospectus or other document which will correct such conflict, statement
or omission.
6.
Conditions of Underwriters’ Obligations. The obligations of the
Underwriters hereunder are subject to the accuracy, as of the date hereof and
the Closing Date (as if made at the Closing Date), of the representations and
warranties of the Company contained herein, to the performance by the Company
of
its obligations hereunder and to the following additional
conditions:
(a)
The
Prospectus shall have been filed with the Commission in a timely fashion in
accordance with Section 4(a) hereof; all filings (including, without limitation,
the Final Term Sheet) required by Rule 424(b) or Rule 433 of the Rules and
Regulations shall have been made within the time periods prescribed by such
Rules, and no such filings will have been made without the consent of the
Representatives (such consent not to be unreasonably withheld or delayed);
no
stop order suspending the effectiveness of the Registration Statement or any
amendment or supplement thereto, preventing or suspending the use of any
Preliminary Prospectus, any Issuer Free Writing Prospectus or the Prospectus,
or
suspending the qualification of the Notes for offering or sale in any
jurisdiction shall have been issued; no proceedings for the issuance of any
such
order shall have been initiated or threatened pursuant to Section 8A of the
Securities Act; no notice of objection of the Commission to use the Registration
Statement or any post-effective amendment thereto shall have been received
by
the Company; and any request of the Commission for additional information (to
be
included in the Registration Statement or the Prospectus or otherwise) shall
have been disclosed to the Representatives and complied with to the
Representatives’ reasonable satisfaction.
(b)
The
Representatives shall have received a letter, dated the date of this Agreement,
of KPMG LLP (“KPMG”), addressed to the Underwriters, confirming
that they are independent public accountants within the meaning of the
Securities Act and the applicable published rules and regulations thereunder
(“Rules and Regulations”) and to the effect that:
9
(i)
in
their opinion the financial statements and schedules examined by them and
included or incorporated by reference in the most recent Preliminary Prospectus
or the Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Securities Act and the related published Rules
and Regulations;
(ii)
they
have performed the procedures specified by the American Institute of Certified
Public Accountants for a review of interim financial information as described
in
Statement of Auditing Standards No. 100, Interim Financial Information, on
the
unaudited financial statements included or incorporated by reference in the
most
recent Preliminary Prospectus or the Prospectus;
(iii)
on
the basis of the review referred to in clause (ii) above, a reading of the
latest available interim financial statements of the Company, inquiries of
officials of the Company who have responsibility for financial and accounting
matters and other specified procedures, nothing came to their attention that
caused them to believe that:
|
(A)
|
the
unaudited financial statements included or incorporated by reference
in
the most recent Preliminary Prospectus or the Prospectus do not comply
as
to form in all material respects with the applicable accounting
requirements of the Securities Act and the related published Rules
and
Regulations or any material modifications should be made to such
unaudited
financial statements for them to be in conformity with generally
accepted
accounting principles;
|
|
(B)
|
at
the date of the latest available balance sheet read by such accountants,
and at a subsequent specified date not more than three business days
prior
to the date of this Agreement, there was any decrease in stockholders’
equity or change in the capital stock or any increase in short-term
indebtedness or long-term debt of the Company and its consolidated
subsidiaries or, at the date of the latest available balance sheet
read by
such accountants, there was any decrease in consolidated net current
assets or total assets, as compared with amounts shown on the latest
balance sheet included or incorporated by reference in the most recent
Preliminary Prospectus or the Prospectus;
or
|
|
(C)
|
for
the period from the closing date of the latest income statement included
or incorporated by reference in the most recent Preliminary Prospectus
or
the Prospectus to the closing date of the latest available income
statement read by such accountants there were any decreases, as compared
with the corresponding period of the previous year and with the period
of
corresponding length ended the date of the latest income statement
included or incorporated by reference in the most recent Preliminary
Prospectus or the Prospectus, in consolidated net sales, net operating
income, the total or per share amounts of net earnings or in the
ratio of
earnings to fixed charges, or any increases or decreases, as the
case may
be, in other items specified by the
Representatives;
|
|
(D)
|
except
in all cases set forth in clauses (B) and (C) above for changes,
increases
or decreases which the most recent Preliminary Prospectus or the
Prospectus discloses have occurred or may occur or which are described
in
such letter;
|
(iv)
the
pro forma financial statements, together with related notes, included or
incorporated by reference in the most recent Preliminary Prospectus or the
Prospectus are consistent with the historical statements, except for the pro
forma adjustments specified therein, and give effect to assumptions made on
a
reasonable basis and present fairly the historical and proposed transactions
contemplated hereby and by the most recent Preliminary Prospectus or the
Prospectus, and nothing came to their attention that caused them to believe
that
the pro forma financial information included or incorporated by reference in
the
most recent Preliminary Prospectus or the Prospectus does not comply as to
form
in all material respects with the accounting requirements of the Securities
Act
and the related published Rules and Regulations or has not been properly
compiled and that the pro forma adjustments have not been properly applied
to
the historical amounts in the compilation of those statements; and
10
(v)
they
have compared specified dollar amounts (or percentages derived from such dollar
amounts), numerical data and other financial information contained in the most
recent Preliminary Prospectus or the Prospectus (in each case to the extent
that
such dollar amounts, percentages, numerical data and other financial information
are derived from the general accounting records of the Company and its
subsidiaries subject to the internal controls of the Company’s accounting system
or are derived directly from such records by analysis or computation) with
the
results obtained from inquiries, a reading of such general accounting records
and other procedures specified in such letter and have found such dollar
amounts, percentages, numerical data and other financial information to be
in
agreement with such results except as otherwise specified in such
letter.
(c)
The
Representatives shall have received a letter, addressed to the Underwriters,
dated the Closing Date, of KPMG which meets the requirements of subsection
(b)
of this Section, except that the specified date referred to in such subsection
will be a date not more than three days prior to the Closing Date for the
purposes of this subsection.
(d)
The
Representatives shall have received a letter, dated the date of this Agreement,
of Ernst & Young LLP (“E&Y”), addressed to the
Underwriters, confirming that they are independent public accountants within
the
meaning of the Securities Act and the applicable Rules and Regulations and
to
the effect that:
(i)
in
their opinion the financial statements and schedules of Caremark Rx, Inc.
examined by them and included or incorporated by reference in the most recent
Preliminary Prospectus or the Prospectus comply as to form in all material
respects with the applicable accounting requirements of the Securities Act
and
the related published Rules and Regulations;
(ii)
they
have compared specified dollar amounts (or percentages derived from such dollar
amounts), numerical data and other financial information contained in the most
recent Preliminary Prospectus or the Prospectus (in each case to the extent
that
such dollar amounts, percentages, numerical data and other financial information
are derived from the general accounting records of Caremark Rx, Inc. and its
subsidiaries subject to the internal controls of Caremark Rx, Inc.’s accounting
system or are derived directly from such records by analysis or computation)
with the results obtained from inquiries, a reading of such general accounting
records and other procedures specified in such letter and have found such dollar
amounts, percentages, numerical data and other financial information to be
in
agreement with such results except as otherwise specified in such
letter.
(e)
The
Representatives shall have received a letter, addressed to the Underwriters,
dated the Closing Date, of E&Y which meets the requirements of subsection
(d) of this Section, except that the specified date referred to in such
subsection will be a date not more than three days prior to the Closing Date
for
the purposes of this subsection.
(f)
Subsequent to the execution and delivery of this Agreement, there shall not
have
occurred (i) any change, or any development involving a prospective change,
in
the condition (financial or other), business, properties or results of
operations of the Company and its subsidiaries, taken as a whole, which, in
the
judgment of the Representatives, is material and adverse and makes it
impractical or inadvisable to proceed with completion of the offering or the
sale of and payment for the Notes; (ii) any downgrading in the rating of any
debt securities of the Company by any “nationally recognized statistical rating
organization” (as defined for purposes of Rule 436(g) under the Securities Act),
or any public announcement that any such organization has under surveillance
or
review its rating of any debt securities of the Company (other than an
announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating); (iii) any change in
U.S.
or international financial, political or economic conditions or currency
exchange rates or exchange controls as would, in the judgment of the
Representatives, be likely to prejudice materially the success of the proposed
issue, sale or distribution of the Notes, whether in the primary market or
in
respect of dealings in the secondary market; (iv) any material suspension or
material limitation of trading in securities generally on the New York Stock
Exchange or any setting of minimum prices for trading on such exchange; (v)
any
suspension of trading of any securities of the Company on any exchange or in
the
over-the-counter market; (vi) any banking moratorium declared by U.S. Federal
or
New York authorities; (vii) any major disruption of settlements of securities
or
clearance services in the United States; or (viii) any attack on the United
States, outbreak or
11
escalation
of major hostilities or act of terrorism involving the United States, any
declaration of war by Congress or any other substantial national or
international calamity or emergency if, in the judgment of the Representatives,
the effect of any such attack, outbreak, escalation, act, declaration, calamity
or emergency makes it impractical or inadvisable to proceed with completion
of
the offering or sale of and payment for the Notes.
(g)
The
Representatives shall have received from Xxxxx Xxxx & Xxxxxxxx, counsel for
the Company, an opinion, addressed to the Underwriters, dated the Closing Date
substantially in the form of ExhibitA hereto.
(h)
The
Representatives shall have received from Xxxxx X. Xxxxxxxxx, General Counsel
and
Secretary of the Company, an opinion, addressed to the Underwriters, dated
the
Closing Date substantially in the form of Exhibit B hereto.
(i)
The
Representatives shall have received from Xxxxx Xxxxxxxxxx LLP, counsel to the
Underwriters, such opinion or opinions, addressed to the Underwriters, dated
the
Closing Date and in form and substance satisfactory to the Representatives,
with
respect to the Notes, Indenture, Registration Statement, Prospectus and
Disclosure Package and other related matters as the Representatives may
reasonably require, and the Company shall have furnished to such counsel such
documents as they may reasonably request for the purpose of enabling them to
pass upon such matters.
(j)
The
Representatives shall have received a certificate, dated the Closing Date,
of
the President or any Vice President and the principal financial or accounting
officer of the Company in which such officers, to the best of their knowledge
after reasonable investigation, shall state that (i) the representations and
warranties of the Company in this Agreement are true and correct, (ii) the
Company has complied with all the agreements and satisfied all the conditions
on
its part to be performed or satisfied hereunder at or prior to the Closing
Date;
(ii) no stop order suspending the effectiveness of the Registration Statement
has been issued, no proceedings for any such purpose have been initiated or
threatened and (iii) subsequent to the dates of the most recent financial
statements in the most recent Preliminary Prospectus and the Prospectus, there
has been no material adverse change, nor any development or event involving
a
prospective material adverse change, in the condition (financial or other),
business, properties or results of operations of the Company and its
subsidiaries, taken as a whole, other than those set forth in or contemplated
by
the most recent Preliminary Prospectus and the Prospectus or as described in
such certificate.
The
Company will furnish the Underwriters with such conformed copies of such
opinions, certificates, letters and documents as the Underwriters reasonably
request. The Representatives may in their sole discretion waive on behalf of
the
Underwriters compliance with any conditions to the obligations of the
Underwriters hereunder.
7.
Indemnification and Contribution.
(a)
The
Company will indemnify and hold harmless each Underwriter, its partners,
members, directors and officers and affiliates and each person, if any, who
controls such Underwriter within the meaning of Section 15 of the Securities
Act, from and against any loss, claim, damage or liability (or any action in
respect thereof), joint or several, to which such Underwriter or such person
may
become subject, under the Securities Act or otherwise, insofar as such loss,
claim, damage or liability (or action in respect thereof) arises out of or
is
based upon (i) any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement, any Preliminary Prospectus, the
Prospectus, or the Disclosure Package, each as amended or supplemented, any
Issuer Free Writing Prospectus or any “issuer information” filed or required to
be filed pursuant to Rule 433(d) of the Rules and Regulations, or (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein (in the case of
any
Preliminary Prospectus, Free Writing Prospectus, the Prospectus and the
Disclosure Package, in the light of the circumstances under which they were
made) not misleading, and will reimburse each Underwriter for any legal or
other
expenses as reasonably incurred by such Underwriter in connection with
investigating, preparing to defend or defending against or appearing as a
third-party witness in connection with any such loss, claim, damage, liability
or action, notwithstanding the possibility that payments for such expenses
might
later be held to be improper, in which case such payments will be promptly
refunded; provided, however, that the Company will not be
liable under this Section 7(a) in any such case to the extent that any such
loss, claim, damage, liability or action
12
arises
out
of or is based upon an untrue statement or alleged untrue statement or omission
or alleged omission made in reliance upon and in conformity with written
information furnished to the Company by any Underwriter directly or through
the
Representatives specifically for use therein (which information is specified
in
Section 12 hereof). The foregoing indemnity agreement shall not inure to the
benefit of any Underwriter if (i) such loss, claim, damage or liability (or
action in respect thereof) arises out of or is based upon an untrue statement
or
alleged untrue statement or omission or alleged omission made in any Preliminary
Prospectus, (ii) the Company informed the Representatives of such untrue
statement or alleged untrue statement or omission or alleged omission prior
to
the Applicable Time, (iii) such untrue statement or alleged untrue statement
or
omission or alleged omission was corrected in an amended or supplemented
Preliminary Prospectus (or, where permitted by law, an Issuer Free Writing
Prospectus) and such corrected Preliminary Prospectus (or Issuer Free Writing
Prospectus) was provided to the Underwriters such that the Underwriters had
a
reasonably sufficient amount of time prior to the Applicable Time to deliver
such corrected Preliminary Prospectus (or Issuer Free Writing Prospectus) to
the
persons to whom the Underwriters are selling the Notes, (iv) the timely delivery
of such corrected Preliminary Prospectus (or Issuer Free Writing Prospectus)
to
such person prior to the Applicable Time would have constituted a complete
defense to the losses, claims, damages and liabilities asserted by such person
and (v) such corrected Preliminary Prospectus (or Issuer Free Writing
Prospectus) was not sent or given by or on behalf of such Underwriter to such
person prior to the Applicable Time.
(b)
Each
Underwriter severally, but not jointly, will indemnify and hold harmless the
Company, its directors, officers and affiliates and each person, if any, who
controls the Company within the meaning of Section 15 of the Securities Act
against any loss, claim, damage or liability (or any action in respect thereof)
to which the Company or such person may become subject, under the Securities
Act
or otherwise, insofar as such loss, claim, damage or liability (or action in
respect thereof) arises out of or is based upon (i) any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement, any Preliminary Prospectus, the Prospectus, the Disclosure Package,
each as amended or supplemented, or any Issuer Free Writing Prospectus, or
(ii)
the omission or alleged omission to state therein a material fact required
to be
stated therein or necessary to make the statements therein not misleading,
and
will reimburse the Company for any legal or other expenses reasonably incurred
by the Company in connection with investigating, preparing to defend or
defending against or appearing as a third-party witness in connection with
any
such loss, claim, damage, liability or action notwithstanding the possibility
that payments for such expenses might later be held to be improper, in which
case such payments will be promptly refunded; provided,
however, that such indemnification or reimbursement will be available
in each such case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information furnished to the
Company by such Underwriter directly or through the Representatives,
specifically for use therein (which information is specified in Section 12
hereof).
(c)
Promptly after receipt by an indemnified party under this Section of notice
of
the commencement of any action, such indemnified party will, if a claim in
respect thereof is to be made against an indemnifying party under subsection
(a)
or (b) above, notify the indemnifying party of the commencement thereof; but
the
failure to notify the indemnifying party shall not relieve it from any liability
that it may have under subsection (a) or (b) above, 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 party shall not relieve it from any liability that it may have
to
an indemnified party otherwise than under subsection (a) or (b) above. In case
any such action is brought against any indemnified party and it notifies an
indemnifying party of the commencement thereof, the indemnifying party will
be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party will
not be liable to such indemnified party under this Section for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened action in respect
of
which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party unless such settlement
(i)
includes an unconditional release of such indemnified party from all liability
on any claims that are the subject matter of such action and (ii) does not
include a statement as to or an admission of fault, culpability or a failure
to
act, by or on behalf of any indemnified party.
13
(d)
If the
indemnification provided for in this Section is unavailable or insufficient
to
hold harmless an indemnified party under subsection (a) or (b) above, then
the
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of the losses, claims, damages or liabilities
referred to in subsection (a) or (b) above (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 Notes or (ii)
if
the allocation provided by clause (i) above is not permitted by applicable
law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above 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 which 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 proportion as the total net proceeds from the
offering (before deducting expenses) received by the Company bear to the total
discounts and commissions received by the Underwriters from the Company under
this Agreement. The relative fault 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 the Underwriters and the parties’
relative intent, knowledge, access to information and opportunity to correct
or
prevent such untrue statement or omission. The amount paid by an indemnified
party as a result of the losses, claims, damages or liabilities referred to
in
the first sentence of this subsection (d) shall be deemed to include any legal
or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any action or claim which is the subject of
this
subsection (d). Notwithstanding the provisions of this subsection (d), the
Underwriters shall not be required to contribute any amount in excess of the
amount by which the total price at which the Notes purchased by it were resold
exceeds the amount of any damages which the Underwriters has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. The Underwriters’ obligations in this subsection (d) to
contribute are several in proportion to their respective purchase obligations
and not joint. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from
any
person who was not guilty of such fraudulent misrepresentation.
(e)
The
obligations of the Company under this Section shall be in addition to any
liability which the Company may otherwise have and shall extend, upon the same
terms and conditions, to each person, if any, who controls any Underwriter
within the meaning of the Securities Act or the Exchange Act; and the
obligations of the Underwriters under this Section shall be in addition to
any
liability which the Underwriters may otherwise have and shall extend, upon
the
same terms and conditions, to each director of the Company and to each person,
if any, who controls the Company within the meaning of the Securities Act or
the
Exchange Act.
8.
Substitution of Underwriters. If any Underwriter or Underwriters
default in their obligations to purchase Notes hereunder and the aggregate
principal amount of the Notes that such defaulting Underwriter or Underwriters
agreed but failed to purchase does not exceed 10% of the total principal amount
of the Notes, the Representatives may make arrangements satisfactory to the
Company for the purchase of such Notes by other persons, including any of the
Underwriters, but if no such arrangements are made by the Closing Date, the
non-defaulting Underwriters shall be obligated severally, in proportion to
their
respective commitments, hereunder, to purchase the Notes that such defaulting
Underwriter or Underwriters agreed but failed to purchase. If any Underwriter
or
Underwriters so default and the aggregate principal amount of the Notes with
respect to which such default or defaults occur exceeds 10% of the total
principal amount of the Notes and arrangements satisfactory to the
Representatives and the Company for the purchase of such Notes by other persons
are not made within 36 hours after such default, this Agreement will terminate
without liability on the part of any non-defaulting Underwriter or the Company,
except as provided in Section 7. As used in this Agreement, the term
“Underwriter” includes any person substituted for an Underwriter under this
Section. Nothing herein will relieve a defaulting Underwriter from liability
for
its default.
9.
Termination. Until the Closing Date, this Agreement may be terminated
by the Representatives on behalf of the Underwriters by giving notice as
hereinafter provided to the Company if (i) the Company will have failed, refused
or been unable, at or prior to the Closing Date, to perform any agreement on
its
part to be performed hereunder, (ii) any of the events described in Sections
6(f) of this Agreement, shall have occurred, or (iii) any other condition to
the
Underwriters’ obligations hereunder is not fulfilled. Any termination of this
Agreement pursuant to this Section 9 will be without liability on the part
of
the Company or any Underwriter, except as otherwise provided in Sections 4(e)
and 7 hereof.
14
Any
notice
referred to above may be given at the address specified in Section 11 of this
Agreement in writing or by telegraph or telephone, and if by telegraph or
telephone, will be immediately confirmed in writing.
10.
Survival of Certain Provisions. The agreements contained in Section 7
of this Agreement and the representations, warranties and agreements of the
Company contained in Sections 1 and 4 of this Agreement will survive the
delivery of the Notes to the Underwriters hereunder and will remain in full
force and effect, regardless of any termination or cancellation of this
Agreement or any investigation made by or on behalf of any indemnified
party.
11.
Notices. Except as otherwise provided in the Agreement, (a) whenever
notice is required by the provisions of this Agreement to be given to the
Company, such notice will be in writing by mail, telex or facsimile transmission
addressed to the Company at Xxx XXX Xxxxx, Xxxxxxxxxx, Xxxxx Xxxxxx 00000,
facsimile number (000) 000-0000, Attention: General Counsel, and (b) whenever
notice is required by the provisions of this Agreement to be given to the
several Underwriters, such notice will be in writing by mail, telex or facsimile
transmission addressed to the Representatives in care of Xxxxxx Brothers Inc.,
000 Xxxxxxx Xxx, Xxx Xxxx, Xxx Xxxx 00000, facsimile number (000) 000-0000,
Attention: Syndicate Registration (with a copy to the General Counsel at the
same address). The Company shall be entitled to act and rely upon any request,
consent, notice or agreement given or made on behalf of the Underwriters by
Xxxxxx Brothers Inc., on behalf of the Representatives.
12.
Information Furnished by Underwriters. The Underwriters severally
confirm that the information appearing in the list of names of each of the
Underwriters under the caption “Underwriting” in the most recent Preliminary
Prospectus and the Prospectus, the concession and reallowance figures appearing
in the third paragraph under the caption “Underwriting” in the most recent
Preliminary Prospectus and the Prospectus, and the statements in the first
two
paragraphs of the subsection entitled “Price Stabilization, Short Positions and
Penalty Bids” and the first paragraph of the subsection entitled “Electronic
Distributions” under the caption “Underwriting” in the most recent Preliminary
Prospectus and the Prospectus, constitute the only written information furnished
to the Company by the Representatives on behalf of the Underwriters, referred
to
in Sections 1(e), 1(f), 1(g), 7(a) and 7(b) of this Agreement.
13.
Nature of Relationship. The Company acknowledges and agrees that in
connection with the offering and the sale of the Notes or any other services
the
Underwriters may be deemed to be providing hereunder, notwithstanding any
preexisting relationship, advisory or otherwise, between the parties or any
oral
representations or assurances previously or subsequently made by the
Underwriters: (i) no fiduciary or agency relationship between the Company and
any other person, on the one hand, and the Underwriters, on the other hand,
exists; (ii) the Underwriters are not acting as advisors, experts or otherwise,
to the Company, including, without limitation, with respect to the determination
of the public offering price of the Notes, and such relationship between the
Company, on the one hand, and the Underwriters, on the other hand, is entirely
and solely a commercial relationship, based on arms-length negotiations; (iii)
any duties and obligations that the Underwriters may have to the Company shall
be limited to those duties and obligations specifically stated herein; and
(iv)
the Underwriters and their respective affiliates may have interests that differ
from those of the Company. The Company hereby waives any claims that the Company
may have against the Underwriters with respect to any breach of fiduciary duty
in connection with this offering.
14.
Parties. This Agreement will inure to the benefit of and be binding
upon the several Underwriters, the Company and their respective successors.
This
Agreement and the terms and provisions hereof are for the sole benefit of only
those persons, except as specifically provided in Section 7 of this Agreement.
Nothing in this Agreement will be construed to give any person, other than
the
persons referred to in this paragraph, any legal or equitable right, remedy
or
claim under or in respect of this Agreement or any provision contained
herein.
15.
Definition of “Business Day”. For purposes of this Agreement,
“Business Day” means any day on which the New York Stock
Exchange is open for trading, other than any day on which commercial banks
are
authorized or required to be closed in New York City.
16.
Governing Law. This Agreement will be governed by, and construed in
accordance with, the laws of the State of New York without regard to principles
of conflicts of laws.
15
17.
Headings. The headings herein are inserted for convenience of reference
only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
18.
Counterparts. This Agreement may be signed in one or more counterparts,
each of which will constitute an original and all of which together will
constitute one and the same agreement.
16
Please
confirm, by signing and returning to us two counterparts of this Agreement,
that
the foregoing correctly sets forth the Agreement between the Company and the
several Underwriters.
|
Very
truly yours,
|
|||
|
CVS
CAREMARK CORPORATION
|
|||
|
By:
|
/s/ Xxxxx X. XxXxxx | ||
|
Name:
|
Xxxxx X. XxXxxx | ||
|
Title:
|
Vice President & Treasurer | ||
|
Confirmed
and accepted as of
the
date first above mentioned
|
|||
|
XXXXXX
BROTHERS INC.
|
|||
|
By:
|
/s/ Xxxxxx X. Xxxxxxx | ||
|
Name:
|
Xxxxxx X. Xxxxxxx | ||
|
Title:
|
Vice Chairman | ||
|
XXXXXX
XXXXXXX & CO. INCORPORATED
|
|||
|
By:
|
/s/ Xxxxx Xxxx | ||
|
Name:
|
Xxxxx Xxxx | ||
|
Title:
|
Vice President | ||
|
BANC
OF AMERICA SECURITIES LLC
|
|||
|
By:
|
/s/ Xxxxx X. Xxxxxxx | ||
|
Name:
|
Xxxxx X. Xxxxxxx | ||
|
Title:
|
Vice President | ||
|
BNY
CAPITAL MARKETS, INC.
|
|||
|
By:
|
/s/ Xxxxxx Xxxxxxxx | ||
|
Name:
|
Xxxxxx Xxxxxxxx | ||
|
Title:
|
Vice President | ||
|
WACHOVIA
CAPITAL MARKETS, LLC
|
|||
|
By:
|
/s/ Xxxxx Xxxxx | ||
|
Name:
|
Xxxxx Xxxxx | ||
|
Title:
|
Managing Director | ||
As
Representatives and on behalf of the several
Underwriters
named
in
Schedule I hereto
SCHEDULE
I
|
Principal
Amount of the
|
Principal
Amount
|
Principal
Amount
|
||||||||||
|
Floating
Rate Notes to
|
of
the 2017 Notes to
|
of
the 2027 Notes
|
||||||||||
|
Underwriters
|
be
purchased
|
be
purchased
|
to
be purchased
|
|||||||||
|
Xxxxxx
Brothers Inc.
|
$ |
321,695,652
|
$ |
321,695,652
|
$ |
183,826,087
|
||||||
|
Xxxxxx
Xxxxxxx & Co. Incorporated
|
$ |
284,565,217
|
$ |
284,565,217
|
$ |
162,608,696
|
||||||
|
Banc
of America Securities LLC
|
$ |
246,521,739
|
$ |
246,521,739
|
$ |
140,869,565
|
||||||
|
BNY
Capital Markets, Inc
|
$ |
246,521,739
|
$ |
246,521,739
|
$ |
140,869,565
|
||||||
|
Wachovia
Capital Markets, LLC
|
$ |
246,521,739
|
$ |
246,521,739
|
$ |
140,869,565
|
||||||
|
LaSalle
Financial Services, Inc.
|
$ |
76,086,957
|
$ |
76,086,957
|
$ |
43,478,261
|
||||||
|
KeyBanc
Capital Markets Inc.
|
$ |
76,086,957
|
$ |
76,086,957
|
$ |
43,478,261
|
||||||
|
SunTrust
Capital Markets, Inc.
|
$ |
76,086,957
|
$ |
76,086,957
|
$ |
43,478,261
|
||||||
|
HSBC
Securities (USA) Inc.
|
$ |
37,130,435
|
$ |
37,130,435
|
$ |
21,217,391
|
||||||
|
Mizuho
Securities USA Inc.
|
$ |
37,130,435
|
$ |
37,130,435
|
$ |
21,217,391
|
||||||
|
Xxxxx
Xxxxxxx & Co.
|
$ |
37,130,435
|
$ |
37,130,435
|
$ |
21,217,391
|
||||||
|
Xxxxx
Fargo Securities, LLC
|
$ |
37,130,435
|
$ |
37,130,435
|
$ |
21,217,391
|
||||||
|
BB&T
Capital Markets, a division of Xxxxx & Xxxxxxxxxxxx,
Inc.
|
$ |
27,391,304
|
$ |
27,391,304
|
$ |
15,652,174
|
||||||
|
Total
|
$ |
1,750,000,000
|
$ |
1,750,000,000
|
$ |
1,000,000,000
|
||||||
