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EXHIBIT 1
Draft of 09/10/97
$350,000,000
MEDPARTNERS, INC.
___% SENIOR SUBORDINATED NOTES DUE _____________, 2000
UNDERWRITING AGREEMENT
September ___, 1997
XXXXX XXXXXX INC.
CREDIT SUISSE FIRST BOSTON CORPORATION
XXXXXXX LYNCH, PIERCE,
XXXXXX & XXXXX INCORPORATED
X.X. XXXXXX SECURITIES INC.
NATIONSBANC CAPITAL MARKETS, INC.
c/o XXXXX XXXXXX INC.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
MedPartners, Inc., a Delaware corporation (the "Company"), proposes, upon
the terms and conditions set forth herein, to issue and sell $350,000,000
aggregate principal amount of its ___% Senior Subordinated Notes due
____________, 2000 (the "Notes") to Xxxxx Xxxxxx Inc., Credit Suisse First
Boston Corporation, Xxxxxxx Xxxxx, Xxxxxx Xxxxxx & Xxxxx Incorporated, X.X.
Xxxxxx Securities Inc. and NationsBanc Capital Markets, Inc. (collectively, the
"Underwriters"). The Notes will be issued pursuant to the provisions of an
Indenture to be dated as of September ___, 1997 (the "Indenture") between the
Company and PNC Bank, Kentucky, Inc., as Trustee (the "Trustee").
The Company wishes to confirm as follows its agreement with the
Underwriters, in connection with the several purchases by the Underwriters of
the Notes.
1. Registration Statement and Prospectus.
The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "Act"), a registration statement on
Form S-3 (File No. 333-30923)
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under the Act (the "registration statement"), including a prospectus subject to
completion relating to the Notes. The term "Registration Statement" as used in
this Agreement means the registration statement (including all financial
schedules and exhibits), as amended at the time it becomes effective, or, if
the registration statement became effective prior to the execution of this
Agreement, as supplemented or amended prior to the execution of this Agreement.
If it is contemplated, at the time this Agreement is executed, that a
post-effective amendment to the registration statement will be filed and must
be declared effective before the offering of the Notes may commence, the term
"Registration Statement" as used in this Agreement means the registration
statement as amended by said post-effective amendment. If an additional
registration statement is prepared and filed with the Commission in accordance
with Rule 462(b) under the Act (an "Additional Registration Statement"), the
term "Registration Statement" as used in this Agreement includes the Additional
Registration Statement.
The term "Prospectus" as used in this Agreement means the prospectus in
the form included in the Registration Statement, or, if the prospectus included
in the Registration Statement omits information in reliance on Rule 430A under
the Act and such information is included in a prospectus filed with the
Commission pursuant to Rule 424(b) under the Act, the term "Prospectus" as used
in this Agreement means the prospectus in the form included in the Registration
Statement as supplemented by the addition of the Rule 430A information
contained in the prospectus filed with the Commission pursuant to Rule 424(b).
The term "Prepricing Prospectus" as used in this Agreement means the prospectus
subject to completion in the form included in the registration statement at the
time of the initial filing of the registration statement with the Commission,
and as such prospectus shall have been amended from time to time prior to the
date of the Prospectus. Any reference herein to the registration statement,
the Registration Statement, any Prepricing Prospectus or the Prospectus shall
be deemed to refer to and include the documents incorporated by reference
therein pursuant to Form S-3 under the Act, as of the date of the registration
statement, the Registration Statement, such Prepricing Prospectus or the
Prospectus, as the case may be, and any reference to any amendment or
supplement to the registration statement, the Registration Statement, any
Prepricing 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") and deemed incorporated by reference
pursuant to Form S-3 under the Act. As used herein, the term "Incorporated
Documents" means the documents which at the time are incorporated by reference
in the registration statement, the Registration Statement, any Prepricing
Prospectus, the Prospectus or any amendment or supplement thereto.
2. Agreements to Sell and Purchase. The Company hereby agrees, subject to
all the terms and conditions set forth herein, to issue and sell to the
Underwriters and, upon the basis of the representations, warranties and
agreements of the Company herein contained and subject to all the terms and
conditions set forth herein, each of the Underwriters agrees, severally and not
jointly, to purchase from the Company, at a purchase price of ___% of the
principal amount thereof, the principal amount of the Notes set forth opposite
the name of such Underwriter in Schedule I hereto (or such principal amount of
Notes increased as set forth in Section 10 hereof).
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3. Terms of Public Offering. The Company has been advised by the
Underwriters that the Underwriters propose to make a public offering of their
respective portions of the Notes as soon after the Registration Statement and
this Agreement have become effective as in their judgment is advisable and
initially to offer the Notes upon the terms set forth in the Prospectus.
4. Delivery of the Notes and Payment Therefor. Delivery to the
Underwriters of and payment for the Notes shall be made at the office of Xxxxx
Xxxxxx Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 A.M., New
York City time, on September ___, 1997 (the "Closing Date"). The place of
closing for the Notes and the Closing Date may be varied by agreement between
the Underwriters and the Company.
The Notes will be delivered to the Underwriters against payment of the
purchase price therefor specified in Section 2 hereof by wire transfer to an
account previously designated to Xxxxx Xxxxxx Inc. by the Company of Federal
(same day) funds and registered in such names and in such denominations as the
Underwriters shall request prior to 1:00 P.M., New York City time, on the
second business day preceding the Closing Date. The Notes to be delivered to
the Underwriters shall be made available to the Underwriters in New York City
for inspection and packaging not later than 9:30 A.M., New York City time, on
the business day next preceding the Closing Date.
5. Agreements of the Company. The Company agrees with the several
Underwriters as follows:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or a post-effective amendment thereto
or any Additional Registration Statement to be declared effective before the
offering of the Notes may commence, the Company will endeavor to cause the
Registration Statement or such post-effective amendment to become effective as
soon as possible and will advise the Underwriters promptly and, if requested by
the Underwriters, will confirm such advice in writing, when the Registration
Statement or such post-effective amendment has become effective.
(b) The Company will advise the Underwriters promptly and, if requested by
the Underwriters, will confirm such advice in writing: (A) of any request by
the Commission for amendment of or a supplement to the Registration Statement,
any Prepricing Prospectus or the Prospectus or for additional information; (B)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of the suspension of
qualification of the Notes for offering or sale in any jurisdiction or the
initiation of any proceeding for such purpose; and (C) within the period of
time referred to in paragraph (f) below, of any change in the Company's
condition (financial or other), business, prospects, properties, net worth or
results of operations, or of the happening of any event, including the filing
of any information, documents or reports pursuant to the Exchange Act, that
makes any statement of a material fact made in the Registration Statement or
the Prospectus (as then amended or supplemented) untrue or
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which requires the making of any additions to or changes in the Registration
Statement or the Prospectus (as then amended or supplemented) in order to state
a material fact required by the Act or the regulations thereunder to be stated
therein or necessary in order to make the statements therein not misleading, or
of the necessity to amend or supplement the Prospectus (as then amended or
supplemented) to comply with the Act or any other law. If at any time the
Commission shall issue any stop order suspending the effectiveness of the
Registration Statement, the Company will make every reasonable effort to obtain
the withdrawal of such order at the earliest possible time.
(c) The Company will furnish to the Underwriters, without charge (A) six
signed copies of the registration statement as originally filed with the
Commission and of each amendment thereto, including financial statements and
all schedules, exhibits and Incorporated Documents thereto, to the registration
statement, (B) such number of conformed copies of the registration statement as
originally filed and of each amendment thereto, but without exhibits and
Incorporated Documents, as the Underwriters may request and (C) such number of
copies of the Indenture as the Underwriters may request.
(d) The Company will not (A) file any amendment to the Registration
Statement or make any amendment or supplement to the Prospectus of which the
Underwriters shall not previously have been advised or to which the
Underwriters shall object after being so advised or (B) so long as, in the
opinion of counsel for the Underwriters, a Prospectus is required to be
delivered in connection with sales by any Underwriter or dealer, file any
information, documents or reports pursuant to the Exchange Act which upon
filing will become an Incorporated Document, without delivering a copy of such
information, documents or reports to the Underwriters, prior to or concurrently
with such filing.
(e) Prior to the execution and delivery of this Agreement, the Company has
delivered to the Underwriters, without charge, in such quantities as the
Underwriters have requested, copies of each form of the Prepricing Prospectus.
The Company consents to the use, in accordance with the provisions of the Act
and with the securities or Blue Sky laws of the jurisdictions in which the
Notes are offered by the several Underwriters and by dealers, prior to the date
of the Prospectus, of each Prepricing Prospectus so furnished by the Company.
(f) As soon after the execution and delivery of this Agreement as possible
and thereafter from time to time for such period as in the opinion of counsel
for the Underwriters a prospectus is required by the Act to be delivered in
connection with sales by any Underwriter or dealer, the Company will
expeditiously deliver to each Underwriter and each dealer, without charge, as
many copies of the Prospectus (and of any amendment or supplement thereto) as
the Underwriters may request. The Company consents to the use of the Prospectus
(and of any amendment or supplement thereto) in accordance with the provisions
of the Act and with the securities or Blue Sky laws of the jurisdictions in
which the Notes are offered by the several Underwriters and by all dealers to
whom the Notes may be sold, both in connection with the offering and sale of
the Notes and for such period of time thereafter as the Prospectus is required
by the Act to be delivered in connection with sales by any Underwriter or
dealer. If during such period of
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time any event shall occur that in the judgment of the Company or in the
opinion of counsel for the Underwriters is required to be set forth in the
Prospectus (as then amended or supplemented) or should be set forth therein in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary to supplement or
amend the Prospectus or to file under the Exchange Act any document which upon
filing becomes an Incorporated Document, to comply with the Act or any other
law, the Company will forthwith prepare and, subject to the provisions of
paragraph (d) above, file with the Commission an appropriate supplement or
amendment thereto or Incorporated Document, and will expeditiously furnish to
the Underwriters and dealers a reasonable number of copies thereof. In the
event that the Company and the Underwriters agree that the Prospectus should be
amended or supplemented or that a document should be filed under the Exchange
Act that upon filing becomes an Incorporated Document, the Company, if
requested by the Underwriters, will promptly issue a press release announcing
or disclosing the matters to be covered by the proposed amendment or supplement
or such document.
(g) The Company will cooperate with the Underwriters and with counsel for
the Underwriters in connection with the registration or qualification of the
Notes for offering and sale by the several Underwriters and by dealers under
the securities or Blue Sky laws of such jurisdictions as the Underwriters may
designate and will file such consents to service of process or other documents
necessary or appropriate in order to effect such registration or qualification;
provided that in no event shall the Company be obligated to qualify to do
business in any jurisdiction where it is not now otherwise required to be so
qualified or to take any action which would subject it to service of process in
suits, other than those arising out of the offering or sale of the Notes, in
any jurisdiction where it is not now so subject.
(h) The Company will make generally available to its security holders a
consolidated earnings statement, which need not be audited, covering a
twelve-month period commencing after the effective date of the Registration
Statement and ending not later than 15 months thereafter, as soon as
practicable after the end of such period, which consolidated earnings statement
shall satisfy the provisions of Section 11(a) of the Act.
(i) So long as any of the Notes are outstanding, the Company will furnish
to the Underwriters (A) as soon as available, a copy of each report of the
Company mailed to stockholders or Noteholders or filed with the Commission or
the New York Stock Exchange and (B) from time to time such other information
concerning the Company as the Underwriters may request.
(j) If this Agreement shall terminate or shall be terminated after
execution pursuant to any provisions hereof (otherwise than pursuant to the
second paragraph of Section 10 hereof or by notice given by the Underwriters
terminating this Agreement pursuant to Section 10 or Section 11 hereof) or if
this Agreement shall be terminated by the Underwriters because of any failure
or refusal on the part of the Company to comply with the terms or fulfill any
of the conditions of this Agreement, the Company agrees to reimburse the
Underwriters for all out-of-pocket expenses (including
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fees and expenses of counsel for the Underwriters) incurred by the Underwriters
in connection herewith.
(k) The Company will apply the net proceeds from the sale of the Notes in
accordance with the description set forth in "Use of Proceeds" in the
Prospectus.
(l) If Rule 430A of the Act is employed, the Company will timely file the
Prospectus pursuant to Rule 424(b) under the Act and will advise the
Underwriters of the time and manner of such filing.
(m) Except as stated in this Agreement and in the Prepricing Prospectus
and Prospectus, the Company has not taken, nor will it take, directly or
indirectly, any action designed to or that might reasonably be expected to
cause or result in stabilization or manipulation of the price of the Notes to
facilitate the sale or resale of the Notes.
6. Representations and Warranties of the Company. The Company represents
and warrants to each Underwriter that:
(a) The execution and delivery of, and the performance by the Company of
its obligations under, this Agreement have been duly and validly authorized by
the Company, and this Agreement has been duly executed and delivered by the
Company and constitutes the valid and legally binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as
enforcement of rights to indemnity and contribution hereunder may be limited by
federal or state securities laws or principles of public policy and subject to
the qualification that the enforceability of the Company's obligations
hereunder may be limited by bankruptcy, insolvency, reorganization, moratorium
and other laws relating to or affecting creditors' rights generally, and by
general equitable principles.
(b) Each Prepricing Prospectus included as part of the registration
statement as originally filed or as part of any amendment or supplement
thereto, or filed pursuant to Rule 424 under the Act, complied when so filed in
all material respects with the provisions of the Act. The Commission has not
issued any order preventing or suspending the use of any Prepricing Prospectus.
(c) The Company meets the requirements for use of Form S-3 under
the Act. The registration statement in the form in which it became or becomes
effective and also in such form as it may be when any post-effective amendment
thereto or any Additional Registration Statement shall become effective, and
the Prospectus and any supplement or amendment thereto when filed with the
Commission under Rule 424(b) under the Act, complied or will comply in all
material respects with the provisions of the Act and did not or will not at any
such times contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except that this representation and warranty does not
apply to statements in or omissions from the registration statement or the
Prospectus made in reliance upon and in conformity with (A) information
relating to any Underwriter furnished to the Company in writing by or on behalf
of any Underwriter expressly for use
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therein or (B) the Trustee's Statement of Eligibility and Qualification (Form
T-1) under the Trust Indenture Act of 1939, as amended (the "1939 Act").
(d) The Company has not distributed and, prior to the later to occur of
(A) the Closing Date and (B) completion of the distribution of the Notes, will
not distribute any offering material in connection with the offering and sale
of the Notes other than the Registration Statement, the Prepricing Prospectus,
the Prospectus or other materials, if any, permitted by the Act.
(e) The Company is a corporation duly organized and validly existing in
good standing under the laws of the State of Delaware with full corporate power
and authority to own, lease and operate its properties and to conduct its
business as presently conducted and as disclosed in the Registration Statement
and the Prospectus, and is duly registered and qualified to conduct its
business and is in good standing in each jurisdiction or place where the nature
of its properties or the conduct of its business requires such registration or
qualification, except where the failure so to register or qualify does not and
will not have a material adverse effect on the condition (financial or other),
business, prospects, properties, net worth or results of operations of the
Company and the Subsidiaries (as hereinafter defined) taken as a whole (a
"Material Adverse Effect").
(f) All the Company's subsidiaries (as defined in the Act but excluding
those subsidiaries which when considered in the aggregate as a single
subsidiary would not constitute a "significant subsidiary" (as defined in the
Act)) are referred to herein individually as a "Subsidiary" and collectively as
the "Subsidiaries". Each Subsidiary that is a corporation is duly organized,
validly existing and in good standing in the jurisdiction of its incorporation,
and each Subsidiary that is a partnership, association or business organization
is legally formed and validly existing under the laws of the jurisdiction of
its organization. Each Subsidiary has full corporate or organizational power
and authority to own, lease and operate its properties and to conduct its
business as presently conducted. Each Subsidiary is duly registered and
qualified to conduct its business (and, if a corporation, is in good standing)
in each jurisdiction or place where the nature of its properties or the conduct
of its business requires such registration or qualification, except where the
failure so to register or qualify does not and will not have a Material Adverse
Effect; all the outstanding shares of capital stock of each Subsidiary which is
a corporation have been duly authorized and validly issued, are fully paid and
nonassessable, and all ownership interests in each Subsidiary which is not a
corporation have been validly created pursuant to the partnership or other
agreements or organizational documents of each such Subsidiary, and, except as
disclosed in the Prospectus, the shares or other interests owned by the Company
are owned by the Company directly, or indirectly through one of the other
Subsidiaries, free and clear of any lien, adverse claim, security interest,
equity or other encumbrance.
(g) The Indenture has been duly and validly authorized and, upon its
execution and delivery by the Company and assuming due execution and delivery
by the Trustee, will be a valid and binding agreement of the Company,
enforceable in accordance with its terms, except to the extent that enforcement
may be limited by bankruptcy, insolvency, reorganization, moratorium and other
laws relating to or
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affecting creditors' rights generally, and by general equitable principles;
and the Indenture has been duly qualified under the 1939 Act and conforms to
the description thereof in the Registration Statement and the Prospectus.
(h) The Notes have been duly authorized and, when executed by the Company
and authenticated by the Trustee in accordance with the Indenture and delivered
to the Underwriters against payment therefor in accordance with the terms
hereof, will have been validly issued and delivered, and will constitute valid
and binding obligations of the Company entitled to the benefits of the
Indenture and enforceable in accordance with their terms, except to the extent
that enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium and other laws relating to or affecting creditors' rights generally,
and by general equitable principles; and the Notes will conform to the
description thereof in the Registration Statement and the Prospectus.
(i) The authorized and outstanding capital stock of the Company is as set
forth under the caption "Capitalization" in the Prospectus and all the
outstanding shares of Common Stock, par value $.001 per share, of the Company
(A) have been duly authorized and validly issued, (B) are fully paid and
nonassessable, (C) are free of any preemptive or similar rights and (D) have
been issued and sold in compliance with all applicable federal and state
securities laws.
(j) Except as disclosed in the Prospectus, there are no outstanding
options, warrants or other rights calling for the issuance of, nor any
commitment, plan or arrangement to issue, any shares of capital stock of the
Company or any security convertible into or exchangeable or exercisable for
capital stock of the Company.
(k) No holder of any security of the Company or any other person has the
right, contractual or otherwise, which right has not been fully complied with
or waived in writing by the holder thereof with evidence of such waiver
heretofore delivered to the Underwriters, (A) to cause the Company to sell or
otherwise issue to them, or to permit them to underwrite the sale of, the
Notes, (B) to have any securities of the Company included in the registration
statement or (C) as a result of the filing of the registration statement or
consummation of the transactions contemplated by this Agreement, to require
registration under the Act of any securities of the Company.
(l) There are no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened, against the Company or any of the
Subsidiaries, or to which the Company or any of the Subsidiaries, or to which
any of their respective properties is subject, that are required to be
disclosed in the Registration Statement or the Prospectus but are not disclosed
as required, and there are no agreements, indentures, leases or other
instruments that are required to be disclosed in the Registration Statement or
the Prospectus or to be filed as an exhibit to the Registration Statement or an
Incorporated Document that are not disclosed or filed as required by the Act or
the Exchange Act.
(m) Neither the Company nor any of the Subsidiaries is (A) in violation of
its respective certificate or articles of incorporation or by-laws, or other
organizational
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documents; (B) in violation of any statute, law, regulation, ordinance,
administrative or governmental rule or regulation applicable to the Company or
any of the Subsidiaries or of any order, ruling, judgment, injunction, order or
decree of any court or governmental agency or body having jurisdiction over the
Company or any of the Subsidiaries or any of their respective properties; or
(C) in default in any material respect in the performance of any obligation,
agreement or condition contained in any bond, debenture, note or any other
evidence of indebtedness or in any material agreement, indenture, lease or
other instrument to which the Company or any of the Subsidiaries is a party or
by which any of them or any of their respective properties may be bound, and no
condition or state of facts exists, which with the passage of time or the
giving of notice or both, would constitute such a default, except in the case
of (B) and (C) above, for such violations or defaults which, individually or in
the aggregate, would not have a Material Adverse Effect.
(n) Neither (i) the issuance, offer, sale or delivery of the Notes, the
execution, delivery or performance of this Agreement and the Indenture by the
Company, the compliance by the Company with the provisions hereof and thereof
nor (ii) the consummation by the Company of the transactions contemplated
hereby and thereby (A) requires any consent, approval, authorization or other
order of, or registration or filing with, any court, regulatory body,
administrative agency or other governmental body, agency or official (except
such as may be required for the registration of the Notes under the Act and the
Exchange Act, the qualification of the Indenture under the 1939 Act and
compliance with the securities or Blue Sky laws of various jurisdictions, all
of which have been or will be effected in accordance with this Agreement); (B)
conflicts or will conflict with or constitutes or will constitute a breach or
violation of, or a default under, the certificate or articles of incorporation
or by-laws, or other organizational documents, of the Company or any of the
Subsidiaries; (C) conflicts or will conflict with or constitutes or will
constitute a breach or violation of, or a default under, any agreement,
indenture, lease or other instrument to which the Company or any of the
Subsidiaries is a party or by which any of them or any of their respective
properties may be bound; (D) violates or will violate any statute, law,
regulation, ordinance, administrative or governmental rule or regulation
applicable to the Company or any of the Subsidiaries or any order, ruling,
judgment, injunction, or decree of any court or governmental agency or body
having jurisdiction over the Company or any of the Subsidiaries or any of their
respective properties; or (E) will result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company or any
of the Subsidiaries pursuant to the terms of any agreement or instrument to
which any of them is a party or by which any of them may be bound or to which
any of the property or assets of any of them is subject.
(o) The conduct of the business of the Company and each of the
Subsidiaries as presently conducted and as disclosed in the Prospectus complies
with all applicable laws, ordinances and administrative or governmental rules
or regulations applicable to the Company and each Subsidiary and with all
orders, rulings, judgments or decrees of any courts or governmental agencies or
bodies having jurisdiction over the Company and each Subsidiary. To the
Company's knowledge, each affiliated physician group, affiliated medical group
and independent practice association (as such terms are used in the Prospectus
and hereinafter referred to collectively, as the "Affiliated Groups")
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is operating in material compliance with all applicable health care laws, rules
and regulations, including, without limitation, those relating to reimbursement
by government agencies and fraudulent or wrongful xxxxxxxx, and no physician in
an Affiliated Group is practicing in conflict with or violation of any such
laws, rules or regulations.
(p) Except as disclosed in the Prospectus, to the Company's knowledge,
none of the Company, any of the Subsidiaries, any employee or agent of the
Company or any Subsidiary or any physician in any Affiliated Group has made any
payment of funds or received or retained any funds in violation of any law,
rule or regulation, including laws and regulations prohibiting fee-splitting or
fees for the referral of patients.
(q) Except as disclosed in the Prospectus, there are no Medicare,
Medicaid, or any other managed care recoupment or recoupments of any
third-party payor being sought, threatened, requested or claimed against the
Company, any of the Subsidiaries or to the Company's knowledge, any Affiliated
Group or any physician in any Affiliated Group, which individually or in the
aggregate could result in a Material Adverse Effect.
(r) No labor dispute with the employees of the Company or any of the
Subsidiaries exists or, to the knowledge of the Company, is imminent.
(s) All employee benefit plans (as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA")) established,
maintained or contributed to by the Company or any of the Subsidiaries (the
"Plans") comply in all material respects with requirements of ERISA and the
Internal Revenue Code of 1986, as amended (the "Code"). With respect to the
Plans, neither the Company nor any of the Subsidiaries has any liability,
contingent or otherwise, under ERISA or the Code, nor does the Company expect
that any such liability will be incurred, that could, singly or in the
aggregate, have a Material Adverse Effect and no employee pension benefit plan
(as defined in Section 3(2) of ERISA) has incurred or assumed an "accumulated
funding deficiency" within the meaning of Section 302 of ERISA or has incurred
or assumed any material liability (other than for the payment of premiums) to
the Pension Benefit Guaranty Corporation.
(t) The Company and each of the Subsidiaries has good and marketable title
to all property (real and personal) disclosed in the Prospectus as being owned
by it, free and clear of all liens, claims, security interests or other
encumbrances, except such as are disclosed in the Registration Statement and
the Prospectus or in a document filed as an exhibit to the Registration
Statement or an Incorporated Document and all the property disclosed in the
Prospectus as being held under lease by the Company and each of the
Subsidiaries is held by it under valid, subsisting and enforceable leases.
(u) The Company and each of the Subsidiaries, and to the Company's
knowledge, each Affiliated Group has such consents, approvals, permits,
licenses, franchises and authorizations of governmental or regulatory
authorities ("permits") as are necessary to own its respective properties and
to conduct its business as presently
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conducted, subject to such qualifications as may be set forth in the
Prospectus; the Company and each of the Subsidiaries, and to the Company's
knowledge, each Affiliated Group has fulfilled and performed all of its
material obligations with respect to such permits and no event has occurred
which allows, or after notice or lapse of time would allow, revocation or
termination thereof or result in any other material impairment of the rights of
the holder of any such permit, subject in each case to such qualification as
may be set forth in the Prospectus; and, except as disclosed in the Prospectus,
none of such permits contains any restriction that is materially burdensome to
the Company, any of the Subsidiaries or any Affiliated Group.
(v) The Company and the Subsidiaries own or possess all patents,
trademarks, trademark registrations, service marks, service mark registrations,
trade names, copyrights, licenses, inventions, trade secrets and rights
disclosed in the Prospectus as being owned by them or any of them or necessary
for the conduct of their respective businesses, and the Company is not aware of
any claim to the contrary or any challenge by any other person to the rights of
the Company and the Subsidiaries with respect to the foregoing.
(w) The Company and each of the Subsidiaries, and to the Company's
knowledge, each of the Affiliated Groups is insured by insurers of recognized
financial responsibility against such losses and risks and in such amounts as
are customary in the businesses or professions in which they are engaged; all
policies of insurance insuring the Company and/or the Subsidiaries or their
respective businesses, assets, employees, officers and directors and to the
Company's knowledge, the Affiliated Groups are in full force and effect; the
Company and each of the Subsidiaries, and to the Company's knowledge, each of
the Affiliated Groups are in compliance with the terms of such policies and
instruments in all material respects; and there are no claims by the Company or
any of the Subsidiaries, or to the Company's knowledge, any of the Affiliated
Groups under any such policy or instrument as to which any insurance company is
denying liability or defending under a reservation of rights clause.
(x) Except as disclosed in the Registration Statement and the Prospectus
(or any amendment or supplement thereto), subsequent to the respective dates as
of which such information is given in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), neither the Company nor
any of the Subsidiaries has incurred any liability or obligation, direct or
contingent, or entered into any transaction, not in the ordinary course of
business, that is material to the Company and the Subsidiaries taken as a
whole, and there has not been any change in the capital stock, or material
increase in the short-term debt or long-term debt, of the Company or any of the
Subsidiaries, or any material adverse change, or any development having or
which may reasonably be expected to have a Material Adverse Effect.
(y) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (A) transactions are executed
in accordance with management's general or specific authorization; (B)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets; (C)
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access to assets is permitted only in accordance with management's general or
specific authorization; and (D) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
(z) The Company and each of the Subsidiaries have duly filed with
appropriate governmental authorities all tax returns required to be filed,
which returns are complete and correct, and neither the Company nor any
Subsidiary is in default in the payment of any taxes which were payable
pursuant to said returns or any assessments with respect thereto and there is
no tax deficiency that has been asserted against the Company or any Subsidiary
that would, if adversely determined, have a Material Adverse Effect.
(aa) The historical financial statements, together with related schedules
and notes included and incorporated by reference in the Registration Statement
and the Prospectus (and any amendment or supplement thereto), present fairly
the information shown therein on the basis stated therein at the respective
dates or for the respective periods to which they apply; such statements and
related schedules and notes have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved, except as disclosed therein;[ the pro forma financial statements and
other pro forma financial information included and incorporated by reference in
the Registration Statement and the Prospectus (and any amendment or supplement
thereto) present fairly the information shown therein, have been prepared in
accordance with the Commission's rules and guidelines with respect to pro forma
financial statements and have been properly compiled on the pro forma bases
described therein and the assumptions used in the preparation thereof are
reasonable and the adjustments used therein are appropriate to give effect to
the transactions or circumstances referred to therein;] and the other financial
and statistical information and data included in the Registration Statement and
the Prospectus (and any amendment or supplement thereto) are accurately
presented and prepared on a basis consistent with such financial statements and
the books and records of the Company and the Subsidiaries.
(ab) The accountants Xxxxx & Young LLP who have certified or shall certify
the consolidated financial statements of the Company [and InPhyNet Medical
Management Inc.] included and incorporated by reference in the Registration
Statement and the Prospectus (or any amendment or supplement thereto) are
independent public accountants as required by the Act and the Exchange Act.
(ac) There has been no storage, disposal, generation, manufacture,
refinement, transportation, handling or treatment of medical wastes or
hazardous substances by the Company or any of the Subsidiaries (or, to the
knowledge of the Company, any of its predecessors in interest) at, upon or from
any of the property now or previously owned or leased by the Company or any of
the Subsidiaries, in violation of any applicable law, ordinance, rule,
regulation, order, judgment, decree or permit or which would require remedial
action under any applicable law, ordinance, rule, regulation, order, judgment,
decree or permit, except for any violation or remedial action which would not
have, or could not be reasonably likely to have, singularly or in the aggregate
with all such violations and remedial actions, a Material Adverse Effect; there
has been no material spill, discharge, leak, emission, injection, escape,
dumping or release of any kind onto such property or of any medical wastes or
hazardous substances due to or caused by the Company or any of the Subsidiaries
or with respect to which the Company or any of the Subsidiaries had knowledge,
except for any such spill, discharge, leak, emission, injection, escapes,
dumpings or releases which would not have or would not be reasonably likely to
have, singularly or in the
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aggregate with all such spills, discharges, leaks, emissions, injections,
escapes, dumpings or releases, a Material Adverse Effect; and the terms
"hazardous substances" and "medical wastes" shall have the meanings specified
in any applicable local, state, federal and foreign laws or regulations with
respect to environmental protection.
(ad) The Company is not now, and after sale of the Notes to be sold by it
hereunder and application of the net proceeds from such sale as disclosed in
the Prospectus under the caption "Use of Proceeds" will not be, an "investment
company" within the meaning of the Investment Company Act of 1940, as amended
(the "1940 Act").
(ae) The Company has complied with all provisions of Florida Statutes,
Section 517.075, relating to issuers doing business with Cuba.
(af) The Incorporated Documents heretofore filed were filed in a timely
manner and, when they were filed (or, if any amendment with respect to any such
document was filed, when such amendment was filed), conformed in all material
respects to the requirements of the Exchange Act and did not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading; and
any further Incorporated Documents will, when so filed, be filed in a timely
manner and conform in all material respects to the requirements of the Exchange
Act and will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading.
(ag) Neither the Company nor any of the Subsidiaries (A) employs any of
the physicians in any Affiliated Group, (B) exercises any influence or control
over the practice of medicine by such physicians, or (C) represents to the
public that it offers medical services; and the Company and each of the
Subsidiaries contracts with the physicians or Affiliated Groups as independent
contractors to provide medical services and is not engaged in the practice of
medicine.
(ah) Each of the practice management agreements, to which the Company
and/or any of its subsidiaries is a party and which is currently in effect
(each a "Practice Management Agreement") has been duly authorized, executed and
delivered by the Company and each Subsidiary which is a party to said agreement
and is a valid, legal and binding agreement of the Company and each such
Subsidiary enforceable against the Company and such Subsidiary in accordance
with its terms; and the business of the Company and the Subsidiaries as
presently conducted, and the terms of each of the Practice Management
Agreements and the performance thereof by the Company and the
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Subsidiaries which are party thereto, do not violate any statute,
administrative or governmental rule or regulation applicable to the Company or
such Subsidiaries or laws prohibiting the corporate practice of medicine,
fee-splitting or fees for the referral of patients, or any orders, rulings,
judgments or decrees of any courts or governmental agencies or bodies having
jurisdiction over the Company and/or the Subsidiaries.
7. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless each Underwriter and
each Underwriter and each person, if any, who controls any Underwriter within
the meaning of Section 15 of the Act or Section 20(a) of the Exchange Act, and
the agents, employees, officers and directors of each Underwriter and each such
controlling person, from and against any and all losses, claims, damages,
liabilities and expenses (including reasonable costs of investigation) arising
out of or based upon any untrue statement or alleged untrue statement of a
material fact contained in any Prepricing Prospectus or in the Registration
Statement or the Prospectus or in any amendment or supplement thereto, or
arising out of or based upon any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or expenses arise out of or are based upon any untrue
statement or omission or alleged untrue statement or omission which has been
made therein or omitted therefrom in reliance upon and in conformity with the
information relating to such Underwriter furnished in writing to the Company by
or on behalf of any Underwriter through the Underwriters expressly for use in
connection therewith; provided, however, that the indemnification contained in
this paragraph (a) with respect to any Prepricing Prospectus shall not inure to
the benefit of any Underwriter (or to the benefit of any person controlling
such Underwriter or any agent, employee, officer or director of such
Underwriter or such controlling person) on account of any such loss, claim,
damage, liability or expense arising from the sale of the Notes by such
Underwriter to any person if a copy of the Prospectus shall not have been
delivered or sent to such person within the time required by the Act and the
regulations thereunder, and the untrue statement or alleged untrue statement or
omission or alleged omission of a material fact contained in such Prepricing
Prospectus was corrected in the Prospectus, provided that the Company has
delivered the Prospectus to the several Underwriters in requisite quantity on a
timely basis to permit such delivery or sending. The foregoing indemnity
agreement shall be in addition to any liability which the Company may otherwise
have.
(b) If any action, suit or proceeding shall be brought against any person
(the "indemnified party") entitled to indemnification pursuant to the preceding
paragraph in respect of which indemnity may be sought against the Company
pursuant to the provisions of the preceding paragraph, such indemnified party
shall promptly notify the Company, and the Company shall assume the defense
thereof, including the employment of counsel and payment of all fees and
expenses. Such indemnified party shall have the right to employ separate
counsel in any such action, suit or proceeding and to participate in the
defense thereof, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (A) the Company has agreed in writing
to pay such fees and expenses, (B) the Company has failed to assume the defense
and
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employ counsel, or (C) the named parties to any such action, suit or proceeding
(including any impleaded parties) include both such indemnified party and the
Company and such indemnified party shall have been advised by its counsel that
representation of such indemnified party and any the Company by the same
counsel would be inappropriate under applicable standards of professional
conduct (whether or not such representation by the same counsel has been
proposed) due to actual or potential differing interests between them (in which
case the Company shall not have the right to assume the defense of such action,
suit or proceeding on behalf of such indemnified party). It is understood,
however, that the Company shall, in connection with any one such action, suit
or proceeding or separate but substantially similar or related actions, suits
or proceedings in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
only one separate firm of attorneys (in addition to any local counsel) at any
time for all such indemnified parties not having actual or potential differing
interests with the Underwriters or among themselves, which firm shall be
designated in writing by Xxxxx Xxxxxx Inc., and that all such fees and expenses
shall be reimbursed as they are incurred. The Company shall not be liable for
any settlement of any such action, suit or proceeding effected without its
written consent, but if settled with such written consent, or if there be a
final judgment for the plaintiff in any such action, suit or proceeding, the
Company agrees to indemnify and hold harmless any indemnified party, to the
extent provided in the preceding paragraph, from and against any loss, claim,
damage, liability or expense by reason of such settlement or judgment.
(c) Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers who sign the
Registration Statement, and any person who controls the Company within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange Act, and the
agents and employees of the Company and each such controlling person, to the
same extent as the foregoing indemnity from the Company to each Underwriter,
but only with respect to information relating to such Underwriter furnished in
writing by or on behalf of such Underwriter through the Underwriters expressly
for use in the Registration Statement, the Prospectus or any Prepricing
Prospectus, or any amendment or supplement thereto. If any action, suit or
proceeding shall be brought against the Company, any of its directors, any such
officer, or any such controlling person or any agent or employee of the Company
or any such controlling person, based on the Registration Statement, the
Prospectus or any Prepricing Prospectus, or any amendment or supplement
thereto, and in respect of which indemnity may be sought against any
Underwriter pursuant to this paragraph (c), such Underwriter shall have the
rights and duties given to the Company by paragraph (b) above (except that if
the Company shall have assumed the defense thereof such Underwriter shall not
be required to do so, but may employ separate counsel therein and participate
in the defense thereof, but the fees and expenses of such counsel shall be at
such Underwriter's expense), and the Company, any of its directors, any such
officer, and any such controlling person, and any agents and employees of the
Company and each such controlling person, shall have the rights and duties
given to the Underwriters by paragraph (b) above.
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(d) If the indemnification provided for in this Section 7 is unavailable
to an indemnified party under paragraphs (a) or (c) hereof in respect of any
losses, claims, damages, liabilities or expenses referred to therein, then an
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities or expenses (A) in such proportion
as is appropriate to reflect the relative benefits received by the Company on
the one hand and the Underwriters on the other hand from the offering of the
Notes, or (B) if the allocation provided by clause (A) above is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (A) above but also the relative fault
of the Company on the one hand and the Underwriters on the other hand in
connection with the statements or omissions that resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other hand 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 underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the
table on the cover page of the Prospectus. The relative fault of the Company
on the one hand and the Underwriters on the other hand shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company on the one hand or
by the Underwriters on the other hand and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(e) The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by a 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 party as a result of the losses, claims, damages,
liabilities and expenses 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 party in connection with
investigating any claim or defending any such action, suit or proceeding.
Notwithstanding the provisions of this Section 7, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
principal amount of the Notes underwritten by it and distributed to the public
exceeds the amount of any damages which 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 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to
this Section 7 are several in proportion to the respective principal amounts of
Notes set forth opposite their names in Schedule I hereto (or such principal
amounts of Notes increased as set forth in Section 10 hereof) and not joint.
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(f) No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened action,
suit or proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such action, suit or proceeding.
(g) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section 7 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 7 and the
representations and warranties of the Company set forth in this Agreement shall
remain operative and in full force and effect, regardless of (A) any
investigation made by or on behalf of any indemnified party, the Company, its
directors and officers, and any person who controls the Company, and the agents
and employees of the Company and each such controlling person, (B) acceptance
of any Notes and payment therefor hereunder, and (C) any termination of this
Agreement. A successor to any Underwriter or any person controlling any
Underwriter, or to the Company, its directors or officers, any person who
controls the Company, and the agents and employees of the Company and each such
controlling person shall be entitled to the benefits of the indemnity,
contribution and reimbursement agreements contained in this Section 7.
8. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters to purchase the Notes hereunder are subject to the following
conditions:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the registration statement or a post-effective amendment thereto
or an Additional Registration Statement to be declared effective before the
offering of the Notes may commence, the registration statement or such
post-effective amendment or Additional Registration Statement shall have become
effective not later than 5:30 P.M., New York City time, on the date hereof, or
at such later date and time as shall be consented to in writing by the
Underwriters, and all filings, if any, required by Rules 424 and 430A under the
Act shall have been timely made; no stop order suspending the effectiveness of
the registration statement shall have been issued and no proceeding for that
purpose shall have been instituted or, to the knowledge of the Company or any
Underwriter, threatened by the Commission, and any request of the Commission
for additional information (to be included in the registration statement or the
prospectus or otherwise) shall have been complied with to the Underwriters
satisfaction.
(b) Subsequent to the effective date of this Agreement, there shall not
have occurred (A) any change, or any development involving a prospective
change, in or affecting the condition (financial or other), business,
prospects, properties, net worth or results of operations of the Company or the
Subsidiaries not contemplated by the Prospectus, which in the Underwriters'
opinion would materially adversely affect the market for the Notes, or (B) any
event or development relating to or involving the
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Company or any officer or director of the Company which makes any statement
made in the Prospectus untrue or which, in the opinion of the Company and its
counsel or the Underwriters and their counsel, requires the making of any
addition to or change in the Prospectus in order to state a material fact
required by the Act or any other law to be stated therein or necessary in order
to make the statements therein not misleading, if amending or supplementing the
Prospectus to reflect such event or development would, in the opinion of the
Underwriters materially adversely affect the market for the Notes.
(c) The Underwriters shall have received on the Closing Date an opinion of
Xxxxxxx Xxxxxxxxx & Xxxxx, L.L.C., counsel for the Company, dated the Closing
Date and addressed to the Underwriters to the effect that:
(i) The Company is a corporation duly incorporated and validly
existing in good standing under the laws of the State of Delaware with full
corporate power and authority to own, lease and operate its properties and to
conduct its business as presently conducted and as disclosed in the
Registration Statement and the Prospectus, and is duly registered and qualified
to conduct its business and is in good standing in each jurisdiction or place
where the nature of its properties or the conduct of its business requires such
registration or qualification, except where the failure so to register or
qualify does not and will not have a Material Adverse Effect;
(ii) To the best knowledge of such counsel, after reasonable inquiry,
the Company has no subsidiaries other than the Subsidiaries. Each Significant
Subsidiary (as defined in Schedule II hereto) is duly organized, validly
existing and in good standing in the jurisdiction of its incorporation, if a
corporation, and is legally formed and validly existing under the laws of the
jurisdiction of its organization, if a partnership, association or business
organization, with full corporate or organizational power and authority to own,
lease and operate its properties and to conduct its business as presently
conducted. Each Significant Subsidiary is duly registered and qualified to
conduct its business (and, if a corporation, is in good standing) in each
jurisdiction or place where the nature of its properties or the conduct of its
business requires such registration or qualification, except where the failure
so to register or qualify does not and will not have a Material Adverse Effect;
all the outstanding shares of capital stock of each Significant Subsidiary
which is a corporation have been duly authorized and validly issued, are fully
paid and nonassessable, and all ownership interests in each Significant
Subsidiary which is not a corporation have been validly created pursuant to the
partnership or other agreements or organizational documents of each such
Significant Subsidiary, and, except as disclosed in the Prospectus, the shares
or other interests owned by the Company are owned by the Company directly, or
indirectly through one of the other Subsidiaries, free and clear of any lien,
adverse claim, security interest, equity or other encumbrances;
(iii) The authorized and outstanding capital stock of the Company is as
set forth under the caption "Capitalization" in the Prospectus;
(iv) All the outstanding shares of capital stock of the Company (A) have
been duly authorized and validly issued, (B) are fully paid and nonassessable,
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(C) are free of any preemptive or similar rights and (D) have been issued and
sold in compliance with all applicable federal and state securities laws;
(v) The Indenture has been duly and validly authorized, executed and
delivered by the Company and assuming due execution and delivery by the
Trustee, is a valid and binding agreement of the Company, enforceable in
accordance with its terms, except to the extent that enforcement may be limited
by bankruptcy, insolvency, reorganization, moratorium and other laws relating
to or affecting creditors' rights generally, and by general equitable
principles; and the Indenture has been duly qualified under the 1939 Act and
conforms in all material respects to the description thereof in the
Registration Statement and the Prospectus;
(vi) The Notes have been duly authorized and executed by the Company and,
assuming due authentication of the Notes by the Trustee in accordance with the
Indenture, upon delivery to the Underwriters against payment therefor in
accordance with the terms hereof, have been validly issued and delivered, and
will constitute valid and binding obligations of the Company entitled to the
benefits of the Indenture and enforceable in accordance with their terms,
except to the extent that enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium and other laws relating to or affecting creditors'
rights generally, and by general equitable principles; and the Notes conform in
all material respects to the description thereof in the Registration Statement
and the Prospectus;
(vii) Except as disclosed in the Prospectus, there are no outstanding
options, warrants or other rights calling for the issuance of, and such counsel
does not know of any commitment, plan or arrangement to issue, any shares of
capital stock of the Company or any security convertible into or exchangeable
or exercisable for capital stock of the Company;
(viii) No holder of any security of the Company or any other person has
the right, contractual or otherwise, which right has not been fully complied
with or waived in writing by the holder thereof, (A) to cause the Company to
sell or otherwise issue to them, or to permit them to underwrite the sale of,
the Notes, (B) to have any securities of the Company included in the
registration statement or (C) as a result of the filing of the registration
statement, to require registration under the Act of any securities of the
Company;
(ix) The Company has full corporate power and authority to enter into
this Agreement and to perform its obligations hereunder, including to issue,
sell and deliver the Notes to be sold by it to the Underwriters as provided
herein, and this Agreement has been duly and validly authorized, executed and
delivered by the Company and is a legal, valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms, except
as enforcement of rights to indemnity and contribution hereunder may be limited
by federal or state securities laws or principles of public policy and subject
to the qualification that the enforceability of the Company's obligations
hereunder may be limited by bankruptcy, insolvency, reorganization,
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moratorium and other laws relating to or affecting creditors' rights generally,
and by general equitable principles;
(x) No consent, approval, authorization or other order of, or
registration or filing with, any court, regulatory body, administrative agency
or other governmental body, agency or official is required on the part of the
Company (except as have been obtained under the Act, the Exchange Act or the
1939 Act, and such as may be required under state securities or Blue Sky laws
governing the purchase and distribution of the Notes) for the valid issuance
and sale of the Notes to the Underwriters as contemplated by this Agreement or
the performance by the Company of its other obligations hereunder;
(xi) Neither (a) the issuance, offer, sale or delivery of the Notes, the
execution, delivery or performance of this Agreement or the Indenture by the
Company, the compliance by the Company with the provisions hereof and thereof
nor (b) the consummation by the Company of the transactions contemplated hereby
and thereby (A) conflicts or will conflict with, or constitutes or will
constitute a breach or violation of, or a default under, the certificate or
articles of incorporation or by-laws, or other organizational documents, of the
Company or any of the Significant Subsidiaries; (B) conflicts or will conflict
with or constitutes or will constitute a breach or violation of, or a default
under, any agreement, indenture, lease or other instrument to which the Company
or any of the Significant Subsidiaries is a party or by which any of them or
any of their respective properties is bound that is an exhibit to the
Registration Statement or any Incorporated Document, or is known to such
counsel after reasonable inquiry; (C) violates or will violate any statute,
law, regulation, ordinance, administrative or governmental rule or regulation
applicable to the Company or any of the Significant Subsidiaries (assuming
compliance with all applicable state securities and Blue Sky laws) or any
order, ruling, judgment, injunction, or decree of any court or governmental
agency or body having jurisdiction over the Company or any of the Significant
Subsidiaries or any of their respective properties; or (D) will result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of the Significant Subsidiaries pursuant to the
terms of any agreement or instrument that is an exhibit to the Registration
Statement or any Incorporated Document, or is known to such counsel after
reasonable inquiry;
(xii) To the best knowledge of such counsel after reasonable inquiry,
neither the Company nor any of the Significant Subsidiaries is (A) in violation
of its respective certificate or articles of incorporation or by-laws, or other
organizational documents; (B) in violation of any statute, law, regulation,
ordinance, administrative or governmental rule or regulation applicable to the
Company or any of the Significant Subsidiaries or any order, ruling, judgment,
injunction or decree of any court or governmental agency or body having
jurisdiction over the Company or any of the Significant Subsidiaries or any of
their respective properties; or (C) in default in any material respect in the
performance of any obligation, agreement or condition contained in any bond,
debenture, note or any other evidence of indebtedness or in any material
agreement, indenture, lease or other instrument to which the Company or any of
the Significant Subsidiaries is a party or by which any of them or any of their
respective
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properties may be bound, and no condition or state of facts exists, which with
the passage of time or the giving of notice or both, would constitute such a
default, except in the case of (B) and (C) above, for such violations or
defaults which, individually or in the aggregate, would not have a Material
Adverse Effect;
(xiii) To the best knowledge of such counsel after reasonable inquiry,
neither the Company nor any of the Significant Subsidiaries is in violation of,
any health care statute, administrative or governmental rule or regulation
applicable to the Company or any of the Significant Subsidiaries, including,
without limitation, those relating to reimbursement by government agencies and
fraudulent or wrongful xxxxxxxx, or any health care judgment, injunction, order
or decree of any court or government entity or instrumentality of the United
States of America having jurisdiction over the Company or any of the
Significant Subsidiaries;
(xiv) To the best knowledge of such counsel after reasonable inquiry,
neither the Company nor any of the Significant Subsidiaries nor any employee or
agent of the Company or any Significant Subsidiary has made any payment of
funds or received or retained any funds in violation of any law, rule or
regulation, including, without limitation, any law, rule or regulation
prohibiting fee-splitting or fees for the referral of patients;
(xv) The Company and each of the Significant Subsidiaries is duly
licensed or authorized in each jurisdiction where it is required to be so
licensed or authorized to conduct its respective businesses; the Company and
each of the Significant Subsidiaries has all other necessary consents,
approvals, permits, licenses, franchises and authorizations of and from all
regulatory authorities to conduct its respective businesses as presently
conducted, and, to the best of such counsel's knowledge after reasonable
inquiry, neither the Company nor any of the Significant Subsidiaries has
received any notification from any regulatory authority, including, without
limitation, any health care regulatory authority, to the effect that any
additional approval is required to be obtained by the Company or any of the
Significant Subsidiaries;
(xvi) To the best knowledge of such counsel after reasonable inquiry,
neither the Company nor any of the Significant Subsidiaries (A) employs any of
the physicians in any Affiliated Group, (B) exercises any influence or control
over the practice of medicine by such physicians, or (C) represents to the
public that it offers medical services; and the Company and each of the
Significant Subsidiaries contracts with the physicians or Affiliated Groups as
independent contractors to provide medical services and is not engaged in the
practice of medicine;
(xvii) Each Practice Management Agreement has been duly authorized,
executed and delivered by the Company and each Significant Subsidiary which is
a party thereto and each such Practice Management Agreement is a valid, legal
and binding agreement of the Company and each such Significant Subsidiary,
enforceable against the Company and such Significant Subsidiary in accordance
with its terms, subject to the qualification that the enforceability thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium, and other
laws relating to or affecting creditors'
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rights generally and by general equitable principles; and the business of the
Company and the Significant Subsidiaries as presently conducted, and the terms
of each Practice Management Agreement and the performance thereof by the
Company and the Significant Subsidiaries which are party thereto, do not
violate any statute, administrative or governmental rule or regulation
applicable to the Company or such Significant Subsidiaries or laws prohibiting
the corporate practice of medicine, fee-splitting or fees for the referral of
patients, or any ruling, judgment, injunction, order or decree of any court or
government entity or instrumentality having jurisdiction over the Company
and/or the Significant Subsidiaries;
(xviii) To the best knowledge of such counsel there are no legal or
governmental proceedings pending or threatened, against the Company or any of
the Significant Subsidiaries, or to which the Company or any of the Significant
Subsidiaries, or to which any of their respective properties is subject, that
are required to be disclosed in the Registration Statement or the Prospectus
but are not disclosed as required;
(xix) Except as disclosed in the Prospectus, the Company and the
Significant Subsidiaries own all patents, trademarks, trademark registrations,
service marks, service mark registrations, trade names, copyrights, licenses,
inventions, trade secrets and rights disclosed in the Prospectus as being owned
by them or any of them or necessary for the conduct of their respective
businesses, and such counsel is not aware of any claim to the contrary or any
challenge by any other person to the rights of the Company and the Significant
Subsidiaries with respect to the foregoing;
(xx) The statements in the Registration Statement and Prospectus insofar
as such statements constitute summaries of the legal matters, documents or
proceedings referred to therein, fairly present the information called for with
respect to such legal matters, documents and proceedings and fairly summarize
the matters referred to therein;
(xxi) Such counsel does not know of any agreements, indentures, leases or
other instruments required to be disclosed in the Registration Statement or the
Prospectus (or any amendment or supplement thereto) or to be filed as an
exhibit to the Registration Statement or any Incorporated Document that are not
so disclosed or filed as required by the Act or the Exchange Act, and such
agreements, indentures, leases or other instruments as are summarized in the
Registration Statement or the Prospectus are fairly summarized in all material
respects;
(xxii) The Registration Statement and the Prospectus and any supplements
or amendments thereto (except for the financial statements and the notes
thereto and the schedules and other financial and statistical data included or
incorporated by reference therein and the Statement of Eligibility on Form T-1,
as to which such counsel need not express any opinion) comply as to form in all
material respects with the requirements of the Act;
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(xxiii) The Registration Statement and all post-effective amendments and
Additional Registration Statements, if any, have become effective under the Act
and, to the best knowledge of such counsel after reasonable inquiry, no stop
order suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose are pending before or contemplated
by the Commission; and any required filing of the Prospectus pursuant to Rule
424(b) has been made in accordance with Rule 424(b);
(xxiv) Each Incorporated Document, at the time it was filed with the
Commission, complied as to form in all material respects with the requirements
of the Exchange Act; and
(xxv) The Company is not, and after the sale of the Notes and the
application of the net proceeds therefrom as disclosed in the Prospectus under
the caption "Use of Proceeds" will not be, an "investment company" within the
meaning of the 1940 Act.
In addition, such counsel shall state that they have participated in the
preparation of the Registration Statement and the Prospectus, including review
and discussion of the contents thereof, and nothing has come to the attention
of such counsel that has caused them to believe that the Registration Statement
at the time the Registration Statement became or becomes effective contained or
contains an untrue statement of a material fact or omitted or omits to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus or any amendment or supplement to
the Prospectus, as of their respective dates, and as of the Closing Date
contained or contains any untrue statement of a material fact or omitted or
omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were or are made,
not misleading (it being understood that such counsel need express no opinion
with respect to the financial statements and the notes thereto and the
schedules and other financial and statistical data included or incorporated by
reference in the Registration Statement or the Prospectus or with respect to
the Statement of Eligibility on Form T-1).
In rendering their opinions as aforesaid, such counsel may rely upon an
opinion or opinions, each dated the Closing Date, of other counsel retained by
them or the Company as to laws of any jurisdiction other than the United States
and the States of Delaware and Alabama, provided that (A) each such local
counsel is acceptable to the Underwriters, (B) such reliance is expressly
authorized by each opinion so relied upon and a copy of each such opinion is
delivered to the Underwriters and is in form and substance satisfactory to them
and their counsel, and (C) counsel shall state in their opinion that they
believe that they and the Underwriters are justified in relying thereon.
(d) The Underwriters shall have received on the Closing Date an opinion of
Xxxxx Xxxxxxxxxx, counsel for the Underwriters, dated the Closing Date and
addressed to the Underwriters with respect to certain of the matters referred
to in paragraph (c) of this Section 8 (including the penultimate paragraph
thereof) and such other related matters as the Underwriters may request.
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(e) The Underwriters shall have received letters addressed to the
Underwriters and dated the date hereof and the Closing Date from Ernst & Young
LLP, independent certified public accountants, substantially in the forms
heretofore approved by the Underwriters.
(f) (A) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been taken or, to the knowledge of the Company, shall be contemplated by the
Commission at or prior to the Closing Date; (B) there shall not have been any
change in the capital stock of the Company or any material increase in the
short-term or long-term debt of the Company (other than in the ordinary course
of business) from that set forth or contemplated in the Registration Statement
or the Prospectus (or any amendment or supplement thereto); (C) there shall not
have been, since the respective dates as of which information is given in the
Registration Statement and the Prospectus (or any amendment or supplement
thereto), except as may otherwise be stated in the Registration Statement and
the Prospectus (or any amendment or supplement thereto), any material adverse
change in the condition (financial or other), business, prospects, properties,
net worth or results of operations of the Company and the Subsidiaries taken as
a whole; (D) the Company and the Subsidiaries shall not have any liabilities or
obligations, direct or contingent (whether or not in the ordinary course of
business), that are material to the Company and the Subsidiaries, taken as a
whole, other than those reflected in the Registration Statement or the
Prospectus (or any amendment or supplement thereto); and (E) all the
representations and warranties of the Company contained in this Agreement shall
be true and correct on and as of the date hereof and on and as of the Closing
Date as if made on and as of the Closing Date, and the Underwriters shall have
received a certificate, dated the Closing Date and signed by the chief
executive officer and the chief financial officer of the Company (or such other
officers as are acceptable to the Underwriters), to the effect set forth in
this Section 8(f) and in Sections 8(h) and 8(j) hereof.
(g) The Underwriters shall have received a certificate dated the Closing
Date signed by the chief accounting officer of the Company substantially in the
form heretofore approved by the Underwriters, respecting the Company's
compliance with the financial covenants set forth in the Company's credit
agreement with NationsBank, National Association (South) (the "Credit
Agreement"), and certain other agreements of the Company.
(h) There shall not have been any announcement by any "nationally
recognized statistical rating organization", as defined for purposes of Rule
436(g) under the Act, that (A) it is downgrading its rating assigned to any
class of securities of the Company or (B) except as disclosed in the
Registration Statement and the Prospectus, it is reviewing its rating assigned
to any class of securities of the Company with a view to possible downgrading,
or with negative implications, or direction not determined.
(i) Prior to the date of this Agreement, the Company shall have received
and shall have furnished to the Underwriters copies of the written consent
of the
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lenders party to the Credit Agreement to the consummation by the Company of the
transactions contemplated by the Prospectus and this Agreement.
(j) The Company shall not have failed at or prior to the Closing Date to
have performed or complied with any of its agreements herein contained and
required to be performed or complied with by it hereunder at or prior to the
Closing Date.
(k) The Company shall have furnished or caused to be furnished to the
Underwriters such further certificates and documents as the Underwriters shall
have reasonably requested.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are satisfactory in form and
substance to the Underwriters and counsel to the Underwriters.
Any certificate or document signed by any officer of the Company and
delivered to the Underwriters, or to counsel for the Underwriters, shall be
deemed a representation and warranty by the Company to each Underwriter as to
the statements made therein.
9. Expenses. The Company agrees to pay the following costs and expenses
and all other costs and expenses incident to the performance by it of its
obligations hereunder: (A) the preparation, printing or reproduction, and
filing with the Commission of the registration statement (including the
financial statements and exhibits thereto), each Prepricing Prospectus, the
Prospectus, and each amendment or supplement to any of them, this Agreement,
the Indenture and the Statement of Eligibility and Qualification of the
Trustee; (B) the printing (or reproduction) and delivery (including postage,
air freight charges and charges for counting and packaging) of such copies of
the registration statement, each Prepricing Prospectus, the Prospectus, the
Incorporated Documents and all amendments or supplements to any of them as may
be reasonably requested for use in connection with the offering and sale of the
Notes; (C) the preparation, printing, authentication, issuance and delivery of
certificates for the Notes, including any stamp taxes in connection with the
original issuance and sale of the Notes; (D) the printing (or reproduction) and
delivery of this Agreement, the preliminary and supplemental Blue Sky Memoranda
and all other agreements or documents printed (or reproduced) and delivered in
connection with the offering of the Notes; (E) the registration or
qualification of the Notes for offer and sale under the securities or Blue Sky
laws of the several states as provided in Section 5(g) hereof (including the
reasonable fees, expenses and disbursements of counsel for the Underwriters
relating to the preparation, printing or reproduction, and delivery of the
preliminary and supplemental Blue Sky Memoranda and such registration and
qualification); (F) the filing fees and the fees and expenses of counsel for
the Underwriters in connection with any filings required to be made with the
National Association of Securities Dealers, Inc.; (G) the transportation and
other expenses incurred by or on behalf of representatives of the Company in
connection with presentations to prospective purchasers of the Notes; (H) the
fees and expenses of the Trustee; (I) the fees and expenses associated with
obtaining ratings for the Notes from nationally recognized statistical rating
organizations; (J) the
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fees and expenses of the Company's accountants; and (K) the fees and expenses
of counsel (including local and special counsel) for the Company.
10. Effective Date of Agreement. This Agreement shall become effective:
(A) upon the execution and delivery hereof by the parties hereto; or (B) if, at
the time this Agreement is executed and delivered, it is necessary for the
registration statement or a post-effective amendment thereto to be declared
effective before the offering of the Notes may commence, when notification of
the effectiveness of the registration statement or such post-effective
amendment has been released by the Commission. Until such time as this
Agreement shall have become effective, it may be terminated by the Company, by
notifying the Underwriters, or by the Underwriters by notifying the Company.
If any one or more of the Underwriters shall fail or refuse to purchase
Notes which it or they have agreed to purchase hereunder, and the aggregate
principal amount of the Notes which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate principal amount of Notes, each non-defaulting Underwriter shall be
obligated, severally, in the proportion which the aggregate principal amount of
Notes set forth opposite its name in Schedule I hereto bears to the aggregate
principal amount of Notes set forth opposite the names of all non-defaulting
Underwriters or in such other proportion as the Underwriters may specify in
accordance with Section 20 of the Master Agreement Among Underwriters of Xxxxx
Xxxxxx, Xxxxxx Xxxxx & Co. Incorporated (predecessor to Xxxxx Xxxxxx Inc.), to
purchase the Notes which such defaulting Underwriter or Underwriters agreed,
but failed or refused, to purchase. If any Underwriter or Underwriters shall
fail or refuse to purchase Notes and the aggregate principal amount of Notes
with respect to which such default occurs is more than one-tenth of the
aggregate principal amount of Notes and arrangements satisfactory to the
Underwriters and the Company for the purchase of such Notes 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. In any such case
which does not result in termination of this Agreement, either the Underwriters
or the Company shall have the right to postpone the Closing Date, but in no
event for longer than seven days, in order that the required changes, if any,
in the Registration Statement and the Prospectus or any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Underwriter from liability in respect of any such
default of any such Underwriter under this Agreement. The term "Underwriter"
as used in this Agreement includes, for all purposes of this Agreement, any
party not listed in Schedule I hereto who, with the approval of the
Underwriters and the approval of the Company, purchases Notes which a
defaulting Underwriter is obligated, but fails or refuses, to purchase.
Any notice under this Section 10 may be given by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
11. Termination of Agreement. This Agreement shall be subject to
termination in absolute discretion of the Underwriters, without liability on
the part of any Underwriter to the Company, by notice to the Company, if prior
to the Closing Date (A)
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trading in securities generally on the New York Stock Exchange, the American
Stock Exchange or the Nasdaq National Market shall have been suspended or
materially limited, (B) a general moratorium on commercial banking activities
in New York shall have been declared by either Federal or state authorities, or
(C) there shall have occurred any outbreak or escalation of hostilities or
other international or domestic calamity, crisis or change in political,
financial or economic conditions, the effect of which on the financial markets
of the United States is such as to make it, in the Underwriters' judgment,
impracticable or inadvisable to commence or continue the offering of the Notes
at the offering price to the public set forth on the cover page of the
Prospectus or to enforce contracts for the resale of the Notes by the
Underwriters. Notice of such termination may be given to the Company by
telegram, telecopy or telephone and shall be subsequently confirmed by letter.
12. Information Furnished by the Underwriters. The statements set forth in
the last paragraph of the cover page, the stabilization legend on the inside
cover page, and the statements in the first and third paragraphs under the
caption "Underwriting" in any Prepricing Prospectus and in the Prospectus,
constitute the only information furnished by or on behalf of any Underwriter
through the Underwriters as such information is referred to in Sections 6(b)
and 7 hereof.
13. Miscellaneous. Except as otherwise provided in Sections 5, 10 and 11
hereof, notice given pursuant to any provision of this Agreement shall be in
writing and shall be delivered (A) if to the Company, at the office of the
Company at 0000 Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxxxxx, XX 00000, Attention:
X. Xxxxxx Xxxxxxxx, Xx., Esq., with a copy to Xxxxxxx Xxxxxxxxx & Xxxxx,
L.L.C., 1200 AmSouth/Xxxxxxx Plaza, 0000 Xxxxx Xxxxxx Xxxxx, Xxxxxxxxxx, XX
00000, Attention: Xxxxxx X. Xxx Xxxxxx, Esq. and X. Xxxxxxx XxXxxxxx, Jr., Esq.
and (B) if to the Underwriters, care of Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, XX 00000, Attention: Manager, Investment Banking Division,
with a copy to Xxxxx Xxxxxxxxxx, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX
00000, Attention: Xxxxxxxxx X. Xxxxxx, Esq.
This Agreement has been and is made solely for the benefit of the several
Underwriters, the Company, its directors and officers, and the other
controlling persons and agents and employees referred to in Section 7 hereof
and their respective successors and assigns, to the extent provided herein, and
no other person shall acquire or have any right under or by virtue of this
Agreement. Neither the term "successor" nor the term "successors and assigns"
as used in this Agreement shall include a purchaser from any Underwriter of any
of the Notes in his status as such purchaser.
14. Applicable Law; Counterparts. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.
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This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof
shall have been executed and delivered on behalf of each party hereto.
Please confirm that the foregoing correctly sets forth the agreement
between the Company and the several Underwriters.
Very truly yours,
MEDPARTNERS, INC.
By:
---------------------------------
Name:
Title:
Confirmed as of the date first above mentioned on behalf of themselves and the
other several Underwriters named in Schedule I hereto.
XXXXX XXXXXX INC.
CREDIT SUISSE FIRST BOSTON CORPORATION
XXXXXXX LYNCH, PIERCE,
XXXXXX & XXXXX INCORPORATED
X.X. XXXXXX SECURITIES INC.
NATIONSBANC CAPITAL MARKETS, INC.
As Representatives of the Several Underwriters
By: XXXXX XXXXXX INC.
By:
---------------------------
Managing Director
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SCHEDULE I
MEDPARTNERS, INC.
Principal Amount
Underwriter of Notes
----------- -----------------
Xxxxx Xxxxxx Inc...........................
Credit Suisse First Boston Corporation.....
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx
& Xxxxx Incorporated.....................
X.X. Xxxxxx Securities Inc.................
NationsBanc Capital Markets, Inc...........
------------
Total................................ $350,000,000
============
