EXHIBIT 1.1
ALLSCRIPTS, INC.
COMMON STOCK
(PAR VALUE $.01 PER SHARE)
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UNDERWRITING AGREEMENT
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........................., 1999
Xxxxxxx, Xxxxx & Co.
Bear, Xxxxxxx & Co. Inc.
CIBC World Markets Corp.
As representatives of the several Underwriters
named in Schedule I hereto,
c/o Goldman, Xxxxx & Co.
00 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Allscripts, Inc., an Illinois corporation, proposes, subject to the
terms and conditions stated herein and concurrently with the consummation of the
Reincorporation Merger described below, to issue and sell to the Underwriters
named in Schedule I hereto (the "Underwriters") an aggregate of _________ shares
(the "Firm Shares") and, at the election of the Underwriters, up to _______
additional shares (the "Optional Shares") of common stock, par value $.01 per
share ("Stock") of _________, the surviving corporation in such Reincorporation
Merger (the Firm Shares and the Optional Shares that the Underwriters elect to
purchase pursuant to Section 2 hereof being collectively called the "Shares").
Subsequent to the date hereof and prior to the First Time of Delivery
(as defined in Section 4 below), it is contemplated that Allscripts, Inc. will
be merged (the "Reincorporation Merger") with and into ___________, a Delaware
corporation ("Merger Corp."), pursuant to an Agreement and Plan of Merger dated
_______, 1999 (the "Merger Agreement") by and between the Company and Merger
Corp. in order to effect the reincorporation of Allscripts, Inc. in Delaware.
All references in this Agreement to the "Company" shall mean (1) Allscripts,
Inc., an Illinois corporation, prior to consummation of the Reincorporation
Merger and (2) _________, the surviving corporation in such Reincorporation
Merger, concurrently with and subsequent to consummation of the Reincorporation
Merger.
1. The Company represents and warrants to, and agrees with, each of
the Underwriters that:
(a) A registration statement on Form S-1 (File No. 333-.........) (the
"Initial Registration Statement") in respect of the Shares has been filed with
the Securities and Exchange Commission (the "Commission"); the Initial
Registration Statement and any post-effective amendment thereto, each in the
form heretofore delivered to you, and, excluding exhibits thereto to you for
each of the other Underwriters, have been declared
effective by the Commission in such form; other than a registration statement,
if any, increasing the size of the offering (a "Rule 462(b) Registration
Statement"), filed pursuant to Rule 462(b) under the Securities Act of 1933, as
amended (the "Act"), which became effective upon filing, no other document with
respect to the Initial Registration Statement has heretofore been filed with the
Commission; and no stop order suspending the effectiveness of the Initial
Registration Statement, any post-effective amendment thereto or the Rule 462(b)
Registration Statement, if any, has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any preliminary
prospectus included in the Initial Registration Statement or filed with the
Commission pursuant to Rule 424(a) of the rules and regulations of the
Commission under the Act is hereinafter called a "Preliminary Prospectus"; the
various parts of the Initial Registration Statement and the Rule 462(b)
Registration Statement, if any, including all exhibits thereto and including the
information contained in the form of final prospectus filed with the Commission
pursuant to Rule 424(b) under the Act in accordance with Section 5(a) hereof and
deemed by virtue of Rule 430A under the Act to be part of the Initial
Registration Statement at the time it was declared effective, each as amended at
the time such part of the Initial Registration Statement became effective or
such part of the Rule 462(b) Registration Statement, if any, became or hereafter
becomes effective, are hereinafter collectively called the "Registration
Statement"; and such final prospectus, in the form first filed pursuant to Rule
424(b) under the Act, is hereinafter called the "Prospectus";
(b) No order preventing or suspending the use of any Preliminary
Prospectus has been issued by the Commission, and each Preliminary Prospectus,
at the time of filing thereof, conformed in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder, 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, in the light of the circumstances under which they were
made, not misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by an
Underwriter through Xxxxxxx, Sachs & Co. expressly for use therein;
(c) The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements of the Act
and the rules and regulations of the Commission thereunder and do not and will
not, as of the applicable effective date as to the Registration Statement and
any amendment thereto, and as of the applicable filing date as to the Prospectus
and any amendment or supplement thereto, 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; provided, however, that
this representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in writing to
the Company by an Underwriter through Xxxxxxx, Xxxxx & Co. expressly for use
therein; there is no material document of a character required to be described
in the Registration Statement or the Prospectus or to be filed as an exhibit to
the Registration Statement which is not described or filed as required;
(d) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included in the
Prospectus any material loss or interference with its business from fire,
explosion, flood or other calamity, whether or not
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covered by insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated in the Prospectus;
and, since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been any change in the
capital stock or long-term debt of the Company or any of its subsidiaries or any
material adverse change, or any development involving a prospective material
adverse change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the Prospectus;
(e) The Company and its subsidiaries have good and marketable title in
fee simple to all real property and good and marketable title to all personal
property owned by them, in each case free and clear of all liens, encumbrances
and defects except such as are described in the Prospectus or such as do not
materially affect the value of such property and do not interfere with the use
made and proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by the
Company and its subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not interfere
with the use made and proposed to be made of such property and buildings by the
Company and its subsidiaries;
(f) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of its jurisdiction of
incorporation, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus, and has been
duly qualified as a foreign corporation for the transaction of business and is
in good standing under the laws of each other jurisdiction in which it owns or
leases properties or conducts any business so as to require such qualification,
or is subject to no material liability or disability by reason of the failure to
be so qualified in any such jurisdiction; and each subsidiary of the Company has
been duly incorporated and is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation;
(g) The Company has an authorized and outstanding capitalization as
set forth in the Prospectus, and all of the issued shares of capital stock of
the Company have been duly and validly authorized and issued, are fully paid and
non-assessable and conform to the description of the Stock contained in the
Prospectus; and all of the issued shares of capital stock of each subsidiary of
the Company have been duly and validly authorized and issued, are fully paid and
non-assessable and (except for directors' qualifying shares) are owned directly
or indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims;
(h) The unissued Shares to be issued and sold by the Company to the
Underwriters hereunder have been duly and validly authorized and, when issued
and delivered against payment therefor as provided herein, will be duly and
validly issued and fully paid and non-assessable and will conform to the
description of the Stock contained in the Prospectus;
(i) The issue and sale of the Shares by the Company and the compliance
by the Company with all of the provisions of this Agreement and the consummation
of the transactions herein contemplated will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its
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subsidiaries is a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company or any of its
subsidiaries is subject, nor will such action result in any violation of the
provisions of the Certificate of Incorporation or By-laws of the Company or any
of its subsidiaries or any statute or any order, rule or regulation of any court
(federal, state, local, foreign or otherwise) or federal, state, local, foreign
or other governmental agency or body having jurisdiction over the Company or any
of its subsidiaries or any of their properties (collectively, "Governmental
Authority"); and no consent, approval, authorization, order, registration or
qualification of or with any such court or Governmental Authority is required
for the issue and sale of the Shares or the consummation by the Company of the
transactions contemplated by this Agreement, except the registration under the
Act of the Shares and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Shares by the Underwriters;
(j) Neither the Company nor any of its subsidiaries is in violation of
its Certificate of Incorporation or By-laws or in default in the performance or
observance of any material obligation, agreement, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement, lease or
other agreement or instrument to which it is a party or by which it or any of
its properties may be bound;
(k) The statements set forth in the Prospectus under the caption
"Description of Capital Stock", insofar as they purport to constitute a summary
of the terms of the Stock, under the captions "Risk Factors -- We are subject to
Government Regulation and Legal Uncertainties" and "-- We may have substantial
sales of our common stock after the Offering," "Business -- Government
Regulation," "Management -- Employment and Other Agreements," "--Employee
Benefit Plans," "Certain Relationships and Related Party Transactions," "Shares
Eligible for Future Sale," and "Underwriting", insofar as they purport to
describe the provisions of the laws and documents referred to therein, are
accurate and fair;
(l) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its subsidiaries
is a party or of which any property of the Company or any of its subsidiaries is
the subject which, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a material adverse
effect on the current or future consolidated financial position, stockholders'
equity or results of operations of the Company and its subsidiaries; and, to the
best of the Company's knowledge, no such proceedings are threatened or
contemplated by Governmental Authorities or threatened by others;
(m) The Company is not and, after giving effect to the offering and
sale of the Shares, will not be an "investment company", as such term is defined
in the Investment Company Act of 1940, as amended (the "Investment Company
Act");
(n) Neither the Company nor any of its affiliates does business with
the government of Cuba or with any person or affiliate located in Cuba within
the meaning of Section 517.075, Florida Statutes;
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(o) PricewaterhouseCoopers LLP, who have certified certain financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder; and
(p) The Company has reviewed its operations and that of its
subsidiaries and any third parties with which the Company or any of its
subsidiaries has a material relationship to evaluate the extent to which the
business or operations of the Company or any of its subsidiaries will be
affected by the Year 2000 Problem. As a result of such review, the Company has
no reason to believe, and does not believe, that the Year 2000 Problem will have
a material adverse effect on the general affairs, management, the current or
future consolidated financial position, business prospects, stockholders' equity
or results of operations of the Company and its subsidiaries or on the ability
of the Company to perform its obligations under this Agreement ("Material
Adverse Effect") or result in any material loss or interference with the
Company's business or operations. The "Year 2000 Problem" as used herein means
any significant risk that computer hardware or software used in the receipt,
transmission, processing, manipulation, storage, retrieval, retransmission or
other utilization of data or in the operation of mechanical or electrical
systems of any kind will not, in the case of dates or time periods occurring
after December 31, 1999, function at least as effectively as in the case of
dates or time periods occurring prior to January 1, 2000.
(q) The consolidated financial statements and schedules included in
the Registration Statement present fairly the consolidated financial position of
the Company as of the respective dates of such financial statements, and the
consolidated results of operations and cash flows of the Company for the
respective periods covered thereby, all in conformity with generally accepted
accounting principles consistently applied throughout the periods involved,
except as disclosed in the Prospectus, and the supporting schedules included in
the Registration Statement present fairly the information required to be stated
therein. The financial information set forth in the Prospectus under the
captions "Summary Consolidated Financial Data" and "Selected Consolidated
Financial Data" presents fairly on the basis stated in the Prospectus, the
information set forth therein. The pro forma information included in the
Prospectus presents fairly the information shown therein, has been prepared in
accordance with generally accepted accounting principles and the Commission's
rules and guidelines with respect to pro forma information, has been properly
compiled on the pro forma basis described therein, and, in the opinion of the
Company, the assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate under the circumstances.
(r) The Company together with its subsidiaries owns and possesses all
right, title and interest in and to, or has duly licensed from third parties a
valid, enforceable right to use, all patents, patent rights, licenses,
inventions, software, copyrights, know-how (including trade secrets and other
unpatented or unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks and trade names (collectively, "Patent
and Proprietary Rights") currently or proposed to be employed by it in
connection with its business, and neither the Company nor any of its
subsidiaries has received any notice of infringement or misappropriation of, or
conflict with, asserted rights of others with respect to any Patent or
Proprietary Rights, or is aware of any facts which would render any Patent or
Proprietary Rights invalid or inadequate to protect the interest of the Company
or its subsidiaries therein, or is aware of any facts which would give rise to a
valid claim of infringement or misappropriation by the Company or its
subsidiaries of the Patent and
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Proprietary Rights of others, and which infringement, misappropriation or
conflict or invalidity or inadequacy, individually or in the aggregate, would or
could be expected to result in a Material Adverse Effect;
(s) The Company and its subsidiaries are in compliance in all respects
with applicable federal, state, local and foreign laws and regulations
(including laws and regulations which regulate (i) the dispensing of
pharmaceuticals and controlled substances, (ii) the licensure of persons or
entities which engage in the business of repackaging, and selling and/or
dispensing, on a wholesale or retail basis, pharmaceuticals and controlled
substances, (iii) the licensure of persons or entities which engage in the
practice of medicine or osteopathy, (iv) the submission of claims to third party
payors, including the Medicare and Medicaid programs, for pharmaceuticals and
controlled substances provided to their beneficiaries including, without
limitation, the Medicare and Medicaid Anti-Fraud and Abuse Amendments, 42 U.S.C.
(S)(S) 1320a-7 through 1320a-8, and the Ethics in Patient Referral Act, 42
U.S.C. (S) 1395nn, (v) the disclosure of confidential information regarding the
medical records, conditions and treatments of individual patients and (vi) the
disposal of medical waste), except where the failure to be in compliance would
not have a Material Adverse Effect. The Company has no knowledge of, nor has the
Company received notice of, any existing violation or alleged violation by the
Company or any of its subsidiaries of any such laws or regulations, except where
such violation would not, individually or together with other such violations,
have a Material Adverse Effect. None of the Company or any of its subsidiaries
or any of their respective directors and officers is currently under
investigation or prosecution for, nor has any one or more of them been convicted
of a criminal offense related to the delivery of a prescription, prescription
drug or other health care item or service, the neglect or abuse of patients or
the obstruction of an investigation of any such criminal offense. The Company
(x) does not provide any "Designated Health Services" as that term is defined in
the Xxxxx Act, (y) does not sell prescription pharmaceutical drugs directly to
patients or refer patients to other sellers of prescription pharmaceutical
drugs, or make or receive referrals for any products or services which are
covered by Medicare or Medicaid, or (z) has in place reasonable procedures to
safeguard against any claims submitted by the Company to payors on behalf of
physicians from being altered or submitted more than once.
(t) The Company and each of its subsidiaries has obtained all
licenses, permits, certificates, authorizations, accreditations, approvals or
consents (collectively, the "Licenses") required by any federal, state, foreign
or local regulatory agencies or bodies to properly and legally operate or
conduct the business in which it is engaged on the date hereof and which are
necessary or desirable for the successful conduct of its business as conducted
and as proposed to be conducted, except where the failure to obtain required
Licenses would not, individually or in the aggregate, have a Material Adverse
Effect. Each License has been duly obtained, is valid and in full force and
effect, and is renewable by its terms or in the ordinary course of business.
None of the Company or any of its subsidiaries is subject to any pending or
threatened administrative or judicial proceeding to revoke, cancel or declare
any License granted to it invalid in any respect. Except for matters which would
not, individually or in the aggregate, have a Material Adverse Effect, none of
the Company or any of its subsidiaries (i) is acting outside the scope and
authority granted to it pursuant to any such License, or otherwise is in default
or in violation with respect to any such License, and no event has occurred
which constitutes, or with due notice or lapse of time or both may constitute, a
default by it or a violation of, any License and (ii) has permitted any License
granted to it to
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lapse since its original effective date. The Company and its subsidiaries have
completed and submitted, on a timely basis, all reports and filings associated
with their businesses as are required by any Governmental Authority, except
where the failure to complete and submit any such reports or filings would not,
individually or in the aggregate, have a Material Adverse Effect.
(u) The Company and each of its subsidiaries has filed all necessary
federal and state income, franchise, sales and use tax returns and has paid all
taxes shown as due thereon, and there is no tax deficiency that has been, or to
the knowledge of the Company might be, asserted against the Company, any of its
subsidiaries, or any of their respective properties or assets that would or
could be expected to have a Material Adverse Effect.
(v) The Company and its subsidiaries carry, or are covered by,
insurance in such amounts and covering such risks as is adequate for the conduct
of their businesses and the value of their properties and as is customary for
companies engaged in similar businesses in similar industries.
(w) Immediately prior to the Reincorporation Merger, Merger Corp. will
be duly incorporated and validly existing as a corporation in good standing
under the laws of the State of Delaware; the execution, delivery and performance
of the Merger Agreement and all documents and instruments executed and delivered
in connection with the Reincorporation Merger have been authorized by all
necessary corporate action (including, without limitation, stockholder approval)
on the part of each of the Company and Merger Corp.; all consents, approvals,
authorizations, orders, Licenses, certificates, permits, registrations or
qualifications required to be obtained in connection with the Reincorporation
Merger have been obtained, other than such consents, approvals, authorizations,
orders, Licenses, certificates, permits, registrations or qualifications which,
individually or in the aggregate, would not have a Material Adverse Effect; the
consummation of the Reincorporation Merger will not (i) conflict with or result
in a breach or violation of any of terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Merger Corp., the Company or any of its
subsidiaries was or is bound or to which any of the property or assets of the
Company or any of its subsidiaries was or is subject, (ii) result in any
violation of the provisions of the Certificate of Incorporation or By-laws of
Merger Corp., the Company or any of its subsidiaries or (iii) result in any
violation of the provisions of any statute or any order, rule or regulation of
any court or Governmental Authority having jurisdiction over Merger Corp., the
Company or any of its subsidiaries or any of their properties, other than, in
the case of clauses (i) and (iii) above, such conflicts, breaches, violations or
defaults that, individually or in the aggregate, would not have a Material
Adverse Effect;
2. Subject to the terms and conditions herein set forth, (a) the
Company agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Company, at
a purchase price per share of $................, the number of Firm Shares set
forth opposite the name of such Underwriter in Schedule I hereto, and (b) in the
event and to the extent that the Underwriters shall exercise the election to
purchase Optional Shares as provided below, the Company agrees to issue and sell
to each of the Underwriters, and each of the Underwriters agrees, severally and
not jointly, to purchase from the Company, at the purchase price per share set
forth in clause (a) of this
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Section 2, that portion of the number of Optional Shares as to which such
election shall have been exercised (to be adjusted by you so as to eliminate
fractional shares) determined by multiplying such number of Optional Shares by a
fraction, the numerator of which is the maximum number of Optional Shares which
such Underwriter is entitled to purchase as set forth opposite the name of such
Underwriter in Schedule I hereto and the denominator of which is the maximum
number of Optional Shares that all of the Underwriters are entitled to purchase
hereunder.
The Company hereby grants to the Underwriters the right to purchase at
their election up to _______ Optional Shares, at the purchase price per share
set forth in the paragraph above, for the sole purpose of covering sales of
shares in excess of the number of Firm Shares. Any such election to purchase
Optional Shares may be exercised only by written notice from you to the Company,
given within a period of 30 calendar days after the date of this Agreement,
setting forth the aggregate number of Optional Shares to be purchased and the
date on which such Optional Shares are to be delivered, as determined by you but
in no event earlier than the First Time of Delivery (as defined in Section 4
hereof) or, unless you and the Company otherwise agree in writing, earlier than
two or later than ten business days after the date of such notice.
3. Upon the authorization by you of the release of the Firm Shares,
the several Underwriters propose to offer the Firm Shares for sale upon the
terms and conditions set forth in the Prospectus.
4. (a) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in such
names as Xxxxxxx, Xxxxx & Co. may request upon at least forty-eight hours' prior
notice to the Company shall be delivered by or on behalf of the Company to
Xxxxxxx, Sachs & Co., for the account of such Underwriter, against payment by or
on behalf of such Underwriter of the purchase price therefor by wire transfer of
Federal (same-day) funds to the account specified by the Company to Xxxxxxx,
Xxxxx & Co. at least forty-eight hours in advance. The Company will cause the
certificates representing the Shares to be made available for checking and
packaging at least twenty-four hours prior to the Time of Delivery (as defined
below) with respect thereto at the office of Xxxxxxx, Sachs & Co., 00 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Designated Office"). The time and date
of such delivery and payment shall be, with respect to the Firm Shares, 9:30
a.m., New York City time, on ............., 1999 or such other time and date as
Xxxxxxx, Xxxxx & Co. and the Company may agree upon in writing, and, with
respect to the Optional Shares, 9:30 a.m., New York time, on the date specified
by Xxxxxxx, Sachs & Co. in the written notice given by Xxxxxxx, Xxxxx & Co. of
the Underwriters' election to purchase such Optional Shares, or such other time
and date as Xxxxxxx, Sachs & Co. and the Company may agree upon in writing.
Such time and date for delivery of the Firm Shares is herein called the "First
Time of Delivery", such time and date for delivery of the Optional Shares, if
not the First Time of Delivery, is herein called the "Second Time of Delivery",
and each such time and date for delivery is herein called a "Time of Delivery".
(b) The documents to be delivered at each Time of Delivery by or on
behalf of the parties hereto pursuant to Section 7 hereof, including the cross
receipt for the Shares and any additional documents requested by the
Underwriters pursuant to Section 7(k) hereof, will be
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delivered at the offices of Xxxxxxxxxxxx Xxxx & Xxxxxxxxx, 0000 Xxxxx Xxxxx,
Xxxxxxx, Xxxxxxxx 00000-0000 (the "Closing Location"), and the Shares will be
delivered at the Designated Office, all at such Time of Delivery. A meeting
will be held at the Closing Location at .......p.m., New York City time, on the
New York Business Day next preceding such Time of Delivery, at which meeting the
final drafts of the documents to be delivered pursuant to the preceding sentence
will be available for review by the parties hereto. For the purposes of this
Section 4, "New York Business Day" shall mean each Monday, Tuesday, Wednesday,
Thursday and Friday which is not a day on which banking institutions in New York
are generally authorized or obligated by law or executive order to close.
5. The Company agrees with each of the Underwriters:
(a) To prepare the Prospectus in a form approved by you and to file
such Prospectus pursuant to Rule 424(b) under the Act not later than the
Commission's close of business on the second business day following the
execution and delivery of this Agreement, or, if applicable, such earlier time
as may be required by Rule 430A(a)(3) under the Act; to make no further
amendment or any supplement to the Registration Statement or Prospectus which
shall be disapproved by you promptly after reasonable notice thereof; to advise
you, promptly after it receives notice thereof, of the time when any amendment
to the Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed and to
furnish you with copies thereof; to advise you, promptly after it receives
notice thereof, of the issuance by the Commission of any stop order or of any
order preventing or suspending the use of any Preliminary Prospectus or
prospectus, of the suspension of the qualification of the Shares for offering or
sale in any jurisdiction, of the initiation or threatening of any proceeding for
any such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or Prospectus or for additional
information; and, in the event of the issuance of any stop order or of any order
preventing or suspending the use of any Preliminary Prospectus or prospectus or
suspending any such qualification, promptly to use its best efforts to obtain
the withdrawal of such order;
(b) Promptly from time to time to take such action as you may
reasonably request to qualify the Shares for offering and sale under the
securities laws of such jurisdictions as you may request and to comply with such
laws so as to permit the continuance of sales and dealings therein in such
jurisdictions for as long as may be necessary to complete the distribution of
the Shares, provided that in connection therewith the Company shall not be
required to qualify as a foreign corporation or to file a general consent to
service of process in any jurisdiction;
(c) Prior to 10:00 a.m., New York City time, on the New York Business
Day next succeeding the date of this Agreement and from time to time, to furnish
the Underwriters with copies of the Prospectus in New York City in such
quantities as you may reasonably request, and, if the delivery of a prospectus
is required at any time prior to the expiration of nine months after the time of
issue of the Prospectus in connection with the offering or sale of the Shares
and if at such time any event shall have occurred as a result of which the
Prospectus as then amended or supplemented would include an untrue statement of
a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made when such Prospectus is delivered, not
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misleading, or, if for any other reason it shall be necessary during such period
to amend or supplement the Prospectus in order to comply with the Act, to notify
you and upon your request to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many copies as you may from time
to time reasonably request of an amended Prospectus or a supplement to the
Prospectus which will correct such statement or omission or effect such
compliance, and in case any Underwriter is required to deliver a prospectus in
connection with sales of any of the Shares at any time nine months or more after
the time of issue of the Prospectus, upon your request but at the expense of
such Underwriter, to prepare and deliver to such Underwriter as many copies as
you may request of an amended or supplemented Prospectus complying with Section
10(a)(3) of the Act;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the effective
date of the Registration Statement (as defined in Rule 158(c) under the Act), an
earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act and the rules and regulations
thereunder (including, at the option of the Company, Rule 158);
(e) During the period beginning from the date hereof and continuing to
and including the date 180 days after the date of the Prospectus, not to offer,
sell, contract to sell or otherwise dispose of, except as provided hereunder any
securities of the Company that are substantially similar to the Shares,
including but not limited to any securities that are convertible into or
exchangeable for, or that represent the right to receive, Stock or any such
substantially similar securities (other than pursuant to (i) employee stock
option plans existing on, or upon the conversion or exchange of convertible or
exchangeable securities outstanding as of, the date of this Agreement, or (ii)
private placements of the Company's securities, provided that in the case of
this clause (ii), the Company has obtained written agreements from the persons
receiving such securities substantially to the effect set forth in this
Subsection 5(e) hereof in form and substance satisfactory to you), without your
prior written consent;
(f) To furnish to its stockholders as soon as practicable after the
end of each fiscal year an annual report (including a balance sheet and
statements of income, stockholders' equity and cash flows of the Company and its
consolidated subsidiaries certified by independent public accountants) and, as
soon as practicable after the end of each of the first three quarters of each
fiscal year (beginning with the fiscal quarter ending after the effective date
of the Registration Statement), to make available to its stockholders
consolidated summary financial information of the Company and its subsidiaries
for such quarter in reasonable detail;
(g) During a period of five years from the effective date of the
Registration Statement, to furnish to you copies of all reports or other
communications (financial or other) furnished to stockholders, and to deliver to
you (i) as soon as they are available, copies of any publicly available reports
and financial statements furnished to or filed with the Commission or any
national securities exchange on which any class of securities of the Company is
listed; and (ii) such additional information concerning the business and
financial condition of the Company as you may from time to time reasonably
request (such financial statements to be on a consolidated basis to the extent
the accounts of the Company and its subsidiaries are consolidated in reports
furnished to its stockholders generally or to the Commission);
-10-
(h) To use the net proceeds received by it from the sale of the Shares
pursuant to this Agreement in the manner specified in the Prospectus under the
caption "Use of Proceeds";
(i) To use its best efforts to list for quotation the Shares on the
Nasdaq National Market ("Nasdaq"); and
(j) To file with the Commission such information on Form 10-Q or Form
10-K as may be required by Rule 463 under the Act; and
(k) If the Company elects to rely upon Rule 462(b), the Company shall
file a Rule 462(b) Registration Statement with the Commission in compliance with
Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the date of this Agreement,
and the Company shall at the time of filing either pay to the Commission the
filing fee for the Rule 462(b) Registration Statement or give irrevocable
instructions for the payment of such fee pursuant to Rule 111(b) under the Act.
(l) The Company will use its best efforts to cause articles of merger
to be filed with the Illinois Secretary of State, a certificate of merger to be
filed with the Secretary of State of Delaware, and such other documents as are
required by the Illinois Business Corporation Act and the Delaware General
Corporation Law to be filed with the Secretary of State of Illinois and the
Secretary of State of Delaware in order to effect the Reincorporation Merger to
be duly filed prior to or concurrently with the First Time of Delivery, and to
cause the Reincorporation Merger to become effective in accordance with all
applicable laws prior to or concurrently with such First Time of Delivery.
(m) Prior to the First Time of Delivery, the Company will deliver to
the counsel for the Underwriters (i) a waiver (collectively, the "Waivers")
signed by each person and entity which possesses any registration rights
pursuant to that certain Eleventh Restated Registration Agreement dated April
16, 1998 (the "Registration Agreement") pursuant to which such person or entity
irrevocably waives (A) any and all rights (whether pursuant Section 2, 3 or 4 of
the Registration Agreement or otherwise) to receive notice of or to have any
securities held by such person or entity registered under the Act pursuant to
the Registration Statement and (B) any and all rights pursuant to Section 2 of
the Registration Agreement to require the Company to file a registration
statement under the Act with the Commission at any time in the future with
respect to any securities held by such person or entity, or (ii) an amendment to
the Registration Agreement having the same effect as the Waivers (the
"Registration Agreement Amendment").
(o) Prior to the First Time of Delivery, the Company will deliver to
the Representatives and counsel for the Underwriters a certificate of good
standing (or the equivalent thereof), dated as of a date within 10 days prior to
the First Time of Delivery, issued by each Governmental Authority which has
jurisdiction over the business of the Company or its subsidiaries in each
jurisdiction in which the Company or its subsidiaries hold a License.
(p) All of the issued and outstanding shares of Series A, B, C, D, F
and G Preferred Stock of the Company will be converted into 2,977,554 shares of
Common Stock at or before the First Time of Delivery.
-11-
6. The Company covenants and agrees with the several Underwriters
that the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, the Blue Sky Memorandum,
closing documents (including any compilations thereof) and any other documents
in connection with the offering, purchase, sale and delivery of the Shares;
(iii) all expenses in connection with the qualification of the Shares for
offering and sale under state securities laws as provided in Section 5(b)
hereof, including the fees and disbursements of counsel for the Underwriters in
connection with such qualification and in connection with the Blue Sky survey;
(iv) all fees and expenses in connection with listing the Shares on Nasdaq; (v)
the filing fees incident to, and the fees and disbursements of counsel for the
Underwriters in connection with, securing any required review by the National
Association of Securities Dealers, Inc. of the terms of the sale of the Shares;
(vi) the cost of preparing stock certificates; (vii) the cost and charges of any
transfer agent or registrar; (viii) all costs and expenses of the Underwriters,
including the fees and disbursements of counsel for the Underwriters, incident
to the offer and sale of Shares by the Underwriters to certain employees and
affiliated persons of the Company and its subsidiaries, and (ix) all other costs
and expenses incident to the performance of its obligations hereunder which are
not otherwise specifically provided for in this Section. It is understood,
however, that, except as provided in this Section, and Sections 8 and 11 hereof,
the Underwriters will pay all of their own costs and expenses, including the
fees of their counsel, stock transfer taxes on resale of any of the Shares by
them, and any advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters hereunder, as to the Shares to
be delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company herein are, at and as of such Time of Delivery, true and correct,
the condition that the Company shall have performed all of its obligations
hereunder theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission pursuant
to Rule 424(b) within the applicable time period prescribed for such filing
by the rules and regulations under the Act and in accordance with Section
5(a) hereof; if the Company has elected to rely upon Rule 462(b), the Rule
462(b) Registration Statement shall have become effective by 10:00 P.M.,
Washington, D.C. time, on the date of this Agreement; no stop order
suspending the effectiveness of the Registration Statement or any part
thereof shall have been issued and no proceeding for that purpose shall
have been initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to your reasonable satisfaction;
(b) Xxxxxxxxxxxx Xxxx & Xxxxxxxxx, counsel for the Underwriters, shall
have furnished to you such written opinion or opinions (a draft of each
such opinion is attached as Annex II(a) hereto), dated such Time of
Delivery, with respect to the matters covered in paragraphs (i), (ii),
(viii), (xiii) and (xviii) of subsection (c) below as
-12-
well as such other related matters as you may reasonably request, and such
counsel shall have received such papers and information as they may
reasonably request to enable them to pass upon such matters;
(c) Xxxxxxx, Carton & Xxxxxxx, counsel for the Company, shall have
furnished to you their written opinion (a draft of such opinion is attached
as Annex II(b) hereto), dated such Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with the requisite corporate power and authority to own
its properties and conduct its business as described in the
Prospectus;
(ii) The Company has an authorized capitalization as set forth
in the Prospectus, and all of the issued shares of capital stock of
the Company (including the Shares being delivered at such Time of
Delivery) have been duly and validly authorized and issued and are
fully paid and non-assessable; and the Shares conform to the
description of the Stock contained in the Prospectus;
(iii) The Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such
qualification or is subject to no material liability or disability by
reason of failure to be so qualified in any such jurisdiction (such
counsel being entitled to rely in respect of the opinion in this
clause upon opinions of local counsel and in respect of matters of
fact upon certificates of officers of the Company, provided that such
counsel shall state that they believe that both you and they are
justified in relying upon such opinions and certificates);
(iv) Each subsidiary of the Company has been duly incorporated
and is validly existing as a corporation in good standing under the
laws of its jurisdiction of incorporation; and all of the issued
shares of capital stock of each such subsidiary have been duly and
validly authorized and issued, are fully paid and non-assessable, and
(except for directors' qualifying shares) are owned directly or
indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims (such counsel being entitled to rely in respect of
the opinion in this clause upon opinions of local counsel and in
respect to matters of fact upon certificates of officers of the
Company or its subsidiaries, provided that such counsel shall state
that they believe that both you and they are justified in relying upon
such opinions and certificates);
(v) Immediately prior to the consummation of the
Reincorporation Merger, Allscripts, Inc. was duly incorporated and
validly existing as a corporation in good standing under the laws of
the State of Illinois and Merger Corp. was duly incorporated and
validly existing as a corporation in good standing under the laws of
the State of Delaware; the execution, delivery and
-13-
performance of the Merger Agreement and all documents and instruments
executed and delivered in connection with the Reincorporation Merger
were authorized by all necessary corporate action (including, without
limitation, stockholder approval) on the part of each of Allscripts,
Inc. and Merger Corp.; to the best of such counsel's knowledge, all
consents, approvals, authorizations, orders, Licenses, certificates,
permits, registrations or qualifications required to be obtained in
connection with the Reincorporation Merger were obtained, other than
such consents, approvals, authorizations, orders, Licenses,
certificates, permits, registrations or qualifications which,
individually or in the aggregate, would not have a Material Adverse
Effect; the Reincorporation Merger did not and will not (i) conflict
with or result in a breach or violation of any of terms or provisions
of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known to such
counsel to which Merger Corp., the Company or any of its subsidiaries
was or is bound or to which any of the property or assets of Merger
Corp., the Company or any of its subsidiaries was or is subject, (ii)
result in any violation of the provisions of the Certificate of
Incorporation or By-laws of Merger Corp., the Company or any of its
subsidiaries or (iii) result in any violation of the provisions of any
statute or any order, rule or regulation known to such counsel of any
court or Governmental Authority having jurisdiction over Merger Corp.,
the Company or any of its subsidiaries or any of their properties,
other than, in the case of clauses (i) and (iii) above, such
conflicts, breaches, violations or defaults that, individually or in
the aggregate, would not have a Material Adverse Effect; articles of
merger and a certificate of merger and such other documents as are
required by the Illinois Business Corporation Act and the Delaware
General Corporation Law to be filed with the Secretary of State of
Illinois and the Secretary of State of Delaware have been duly filed,
and the Reincorporation Merger became effective in accordance with all
applicable laws;
(vi) The Company and its subsidiaries have good and
marketable title in fee simple to all real property owned by them, in
each case free and clear of all liens, encumbrances and defects except
such as are described in the Prospectus or such as do not materially
affect the value of such property and do not interfere with the use
made and proposed to be made of such property by the Company and its
subsidiaries; and any real property and buildings held under lease by
the Company and its subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be
made of such property and buildings by the Company and its
subsidiaries (in giving the opinion in this clause, such counsel may
state that no examination of record titles for the purpose of such
opinion has been made, and that they are relying upon a general review
of the titles of the Company and its subsidiaries, upon opinions of
local counsel and abstracts, reports and policies of title companies
rendered or issued at or subsequent to the time of acquisition of such
property by the Company or its subsidiaries, upon opinions of counsel
to the lessors of such property and, in respect to matters of fact,
upon certificates of officers of the Company or its subsidiaries,
provided that such counsel shall state that they
-14-
believe that both you and they are justified in relying upon such
opinions, abstracts, reports, policies and certificates);
(vii) To the best of such counsel's knowledge and other than
as set forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is
a party or of which any property of the Company or any of its
subsidiaries is the subject which could individually or in the
aggregate reasonably be expected to have a Material Adverse Effect;
and, to the best of such counsel's knowledge, no such proceedings are
threatened or contemplated by Governmental Authorities or threatened
by others;
(viii) This Agreement has been duly authorized, executed and
delivered by the Company;
(ix) The issue and sale of the Shares being delivered at such
Time of Delivery by the Company and the compliance by the Company with
all of the provisions of this Agreement and the consummation of the
transactions herein contemplated will not conflict with or result in a
breach or violation of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument known to such counsel
to which the Company or any of its subsidiaries is a party or by which
the Company or any of its subsidiaries is bound or to which any of the
property or assets of the Company or any of its subsidiaries is
subject, nor will such action result in any violation of the
provisions of the Certificate of Incorporation or By-laws of the
Company or any statute or any order, rule or regulation known to such
counsel of any court or Governmental Authority having jurisdiction
over the Company or any of its subsidiaries or any of their
properties;
(x) No consent, approval, authorization, order, registration
or qualification of or with any such court or Governmental Authority
is required for the issue and sale of the Shares or the consummation
by the Company of the transactions contemplated by this Agreement,
except the registration under the Act of the Shares, and such
consents, approvals, authorizations, registrations or qualifications
as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Shares by the
Underwriters;
(xi) Neither the Company nor any of its subsidiaries is in
violation of its Certificate of Incorporation or By-laws or, to the
best knowledge of such counsel, is in default in the performance or
observance of any material obligation, agreement, covenant or
condition contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a
party or by which it or any of its properties may be bound;
-15-
(xii) The statements set forth in the Prospectus under the
caption "Description of Capital Stock", insofar as they purport to
constitute a summary of the terms of the Stock, under the captions
"Risk Factors -- We may have substantial sales of our common stock
after the Offering," "Management --Employment and Other Agreements,"
"-- Employee Benefit Plans," "Certain Relationships and Related Party
Transactions," "Shares Eligible for Future Sale," and "Underwriting",
insofar as they purport to describe the provisions of the laws and
documents referred to therein, are accurate and fair;
(xiii) The Company is not an "investment company", as such term
is defined in the Investment Company Act;
(xiv) Except as disclosed in the Prospectus, no person has the
right, contractual or otherwise, to cause the Company or any of its
subsidiaries to issue, or register pursuant to the Act, any shares of
capital stock of the Company, or any of its subsidiaries, upon the
issue and sale of the Shares to be sold by the Company to the
Underwriters pursuant to this Agreement;
(xv) The Company together with its subsidiaries owns and
possesses all right, title and interest in and to, or has duly
licensed from third parties a valid, enforceable right to use, all
Patent and Proprietary Rights currently or proposed in the Prospectus
to be employed by it in connection with its business; and to the best
knowledge of such counsel after due inquiry, neither the Company nor
any of its subsidiaries has received any notice of infringement or
misappropriation of, or conflict with, asserted rights of others with
respect to any Patent or Proprietary Rights, and such counsel is not
aware of any facts which could reasonably be expected to render any
Patent or Proprietary Rights invalid or inadequate to protect the
interest of the Company or its subsidiaries therein, or which could
reasonably be expected to give rise to a valid claim of infringement
or misappropriation by the Company or its subsidiaries of the Patent
and Proprietary Rights of others, and which infringement,
misappropriation or conflict or invalidity or inadequacy, individually
or in the aggregate, would or could reasonably be expected to have a
Material Adverse Effect;
(xvi) The Registration Statement and the Prospectus and any
further amendments and supplements thereto made by the Company prior
to such Time of Delivery (other than the financial statements and
related schedules therein, as to which such counsel need express no
opinion) comply as to form in all material respects with the
requirements of the Act and the rules and regulations thereunder;
although they do not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the
Registration Statement or the Prospectus, except for those referred to
in the opinion in subsection (xii) of this section 7(c), they have no
reason to believe that, as of its effective date, the Registration
Statement or any further amendment thereto made by the Company prior
to such Time of Delivery (other than the financial statements and
related schedules therein, as to which such counsel need express no
opinion) contained an untrue statement of a material
-16-
fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or that, as
of its date, the Prospectus or any further amendment or supplement
thereto made by the Company prior to such Time of Delivery (other than
the financial statements and related schedules therein, as to which
such counsel need express no opinion) contained an untrue statement of
a material fact or omitted to state a material fact necessary to make
the statements therein, in the light of the circumstances under which
they were made, not misleading or that, as of such Time of Delivery,
either the Registration Statement or the Prospectus or any further
amendment or supplement thereto made by the Company prior to such Time
of Delivery (other than the financial statements and related schedules
therein, as to which such counsel need express no opinion) contains an
untrue statement of a material fact or omits to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and they do
not know of any amendment to the Registration Statement required to be
filed or of any contracts or other documents of a character required
to be filed as an exhibit to the Registration Statement or required to
be described in the Registration Statement or the Prospectus which are
not filed or described as required.
(d) Green, Stewart, Xxxxxx & Xxxxxxxx, P.C., counsel for the Company,
shall have furnished to you their written opinion, dated such Time of
Delivery, in form and substance satisfactory to you, to the effect that:
(i) The statements set forth in the Prospectus under the
captions "Risk Factors -- We are subject to government regulation and
legal uncertainties" and "Business -- Government Regulation," insofar
as they purport to describe the provisions of the laws and documents
referred to therein, are accurate, complete and fair;
(ii) The conduct of the business of the Company and each of
its subsidiaries is in compliance in all respects with applicable
federal, state, local and foreign laws and regulations (including laws
and regulations which regulate (a) the dispensing of pharmaceuticals
and controlled substances, (b) the licensure of persons or entities
which engage in the business of repackaging, and selling and/or
dispensing, on a wholesale or retail basis, pharmaceuticals and
controlled substances, (c) the licensure of persons or entities which
engage in the practice of medicine or osteopathy, (d) the submission
of claims to third party payors, including the Medicare and Medicaid
programs, for pharmaceuticals and controlled substances provided to
their beneficiaries including, without limitation, the Medicare and
Medicaid Anti-Fraud and Abuse Amendments, 42 U.S.C. (S)(S) 1320a-7
through 1320a-8, and the Ethics in Patient Referral Act, 42 U.S.C. (S)
1395nn, (e) the disclosure of confidential information regarding the
medical records, conditions and treatments of individual patients and
(f) the disposal of medical waste), except where the failure to be in
compliance would not, individually or in the aggregate, have a
Material Adverse Effect; and
-17-
(iii) The Company and each of its subsidiaries have obtained
all Licenses required by any Governmental Authority to properly and
legally operate or conduct the businesses in which it is engaged on
the date of such opinion and which are necessary for the successful
conduct of its business as it is conducted and proposed in the
Prospectus to be conducted, and each such License has been duly
obtained, is valid and in full force and effect. To the best of such
counsel's knowledge, none of the Company or any of its subsidiaries
(a) is subject to any pending or threatened administrative or judicial
proceeding to revoke, cancel or declare any License granted to it
invalid in any respect, (b) is acting outside the scope and authority
granted to it pursuant to any such License, or otherwise is in default
or in violation with respect to any such License, and no event has
occurred which constitutes, or with due notice or lapse of time or
both may constitute, a default by it or a violation of, any License
and (c) has permitted any License granted to it to lapse since its
original effective date, except for any such lapses which did not,
individually or in the aggregate, have a Material Adverse Effect.
In rendering opinions (ii) and (iii) above, such counsel may state
that with respect to jurisdictions other than federal, Illinois and
jurisdictions in which such counsel is licensed, such opinion is based on
their examination of the most recent service compilations available of the
laws of the jurisdictions in question, the published rules or regulations,
if any, of the officials administering such laws, and the case law as to
which such counsel has actual knowledge. Such counsel may rely upon the
opinion of Arent Fox Xxxxxxx Xxxxxxx & Xxxx as to matters relating to
compliance with laws and regulations administered by the Food & Drug
Administration. Such counsel may also rely upon the opinion of competent
local counsel satisfactory to counsel to the Underwriters as to matters
arising under the laws of jurisdictions other than federal, Illinois and
states in which such counsel is licensed.
(e) On the date of the Prospectus at a time prior to the execution of
this Agreement, at 9:30 a.m., New York City time, on the effective date of
any post-effective amendment to the Registration Statement filed subsequent
to the date of this Agreement and also at each Time of Delivery,
PricewaterhouseCoopers LLP shall have furnished to you a letter or letters,
dated the respective dates of delivery thereof, in form and substance
satisfactory to you, to the effect set forth in Annex I hereto (the
executed copy of the letter delivered prior to the execution of this
Agreement is attached as Annex I(a) hereto and a draft of the form of
letter to be delivered on the effective date of any post-effective
amendment to the Registration Statement and as of each Time of Delivery is
attached as Annex I(b) hereto);
(f) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included in the Prospectus any loss or interference with its business from
fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order
or decree, otherwise than as set forth or contemplated in the Prospectus,
and (ii) since the respective dates as of which information is given in the
Prospectus there shall not have been any change in the capital stock or
long-term debt of the Company or any of its subsidiaries or any change, or
any development involving a prospective change, in or affecting the general
affairs, management, financial position, stockholders' equity or results of
operations of the Company and its
-18-
subsidiaries, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any such case described in clause (i)
or (ii), is in the judgment of the Representatives so material and adverse
as to make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Shares being delivered at such Time of
Delivery on the terms and in the manner contemplated in the Prospectus;
(g) On or after the date hereof (i) no downgrading shall have occurred
in the rating accorded the Company's debt securities or preferred stock by
any "nationally recognized statistical rating organization", as that term
is defined by the Commission for purposes of Rule 436(g)(2) under the Act,
and (ii) no such organization shall have publicly announced that it has
under surveillance or review, with possible negative implications, its
rating of any of the Company's debt securities or preferred stock;
(h) On or after the date hereof there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange or on Nasdaq; (ii) a
suspension or material limitation in trading in the Company's securities on
Nasdaq; (iii) a general moratorium on commercial banking activities
declared by either Federal, New York or Illinois State authorities; or (iv)
the outbreak or escalation of hostilities involving the United States or
the declaration by the United States of a national emergency or war, if the
effect of any such event specified in this clause (iv) in the judgment of
the Representatives makes it impracticable or inadvisable to proceed with
the public offering or the delivery of the Shares being delivered at such
Time of Delivery on the terms and in the manner contemplated in the
Prospectus;
(i) The Shares to be sold at such Time of Delivery shall have been
duly listed for quotation on Nasdaq; and
(j) The Company has obtained and delivered to the Underwriters
executed copies of agreements from all officers, directors and key
employees named in the Prospectus, certain other employees of the Company
who are securityholders, and all persons who will beneficially own or have
the right to acquire 1.0% or more of the outstanding Shares immediately
after the First Time of Delivery (assuming no exercise of the Underwriters'
over-allotment option), substantially to the effect set forth in Subsection
5(e) hereof in form and substance satisfactory to you;
(k) The Company shall have complied with the provisions of Section
5(c) hereof with respect to the furnishing of prospectuses on the New York
Business Day next succeeding the date of this Agreement;
(l) The Company shall have furnished or caused to be furnished to you
at such Time of Delivery certificates of officers of the Company
satisfactory to you as to the accuracy of the representations and
warranties of the Company herein at and as of such Time of Delivery, as to
the performance by the Company of all of its obligations hereunder to be
performed at or prior to such Time of Delivery, as to the matters set forth
in subsections (a) and (e) of this Section and as to such other matters as
you may reasonably request;
-19-
(m) The Reincorporation Merger shall have became effective in
accordance with all applicable laws. Articles of merger shall have been
filed with the Illinois Secretary of State, a certificate of merger shall
have been filed with the Secretary of State of Delaware, and such other
documents as are required by the Illinois Business Corporation Act and the
Delaware General Corporation Law to be filed with the Secretary of State of
Illinois and the Secretary of State of Delaware in order to effect the
Reincorporation Merger shall have been filed and evidence of such filings
satisfactory to counsel to the Underwriters shall have been delivered to
such counsel; and
(n) The Company shall have delivered duly executed Waivers from each
person possessing registration rights pursuant to the Registration
Agreement, or a duly executed copy of the Registration Agreement Amendment.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or any amendment or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse each Underwriter for any legal or
other expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such action or claim as such expenses are
incurred; provided, however, that the Company shall not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in any Preliminary Prospectus, the Registration Statement
or the Prospectus or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by any Underwriter
through Xxxxxxx, Sachs & Co. expressly for use therein.
(b) Each Underwriter will indemnify and hold harmless the Company against
any losses, claims, damages or liabilities to which the Company may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in any Preliminary
Prospectus, the Registration Statement or the Prospectus or any such amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company by such Underwriter through Xxxxxxx, Xxxxx & Co.
expressly for use therein; and will reimburse the Company for any legal or other
expenses reasonably incurred by the Company in connection with investigating or
defending any such action or claim as such expenses are incurred.
-20-
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the written
consent of the indemnified party, effect the settlement or compromise of, or
consent to the entry of any judgment with respect to, any pending or threatened
action or claim in respect of which indemnification or contribution may be
sought hereunder (whether or not the indemnified party is an actual or potential
party to such action or claim) unless such settlement, compromise or judgment
(i) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act, by or
on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is unavailable to
or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Underwriters on the other from the
offering of the Shares. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the indemnified
party failed to give the notice required under subsection (c) above, then each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one hand and
the Underwriters on the other in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions in
respect thereof), as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the Underwriters
on the other shall be deemed to be in the same proportion as the total net
proceeds from the offering (before deducting expenses) received by the Company
bear to the total 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 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 the Underwriters on the other and the
parties' relative intent, knowledge, access to information and opportunity to
correct or
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prevent such statement or omission. The Company and the Underwriters agree that
it would not be just and equitable if contributions pursuant to this subsection
(d) were determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to above in
this subsection (d). The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subsection (d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages 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 in this subsection (d) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company (including any
person who, with his or her consent, is named in the Registration Statement as
about to become a director of the Company) and to each person, if any, who
controls the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase the
Shares which it has agreed to purchase hereunder at a Time of Delivery, you may
in your discretion arrange for you or another party or other parties to purchase
such Shares on the terms contained herein. If within thirty-six hours after such
default by any Underwriter you do not arrange for the purchase of such Shares,
then the Company shall be entitled to a further period of thirty-six hours
within which to procure another party or other parties satisfactory to you to
purchase such Shares on such terms. In the event that, within the respective
prescribed periods, you notify the Company that you have so arranged for the
purchase of such Shares, or the Company notifies you that it has so arranged for
the purchase of such Shares, you or the Company shall have the right to postpone
such Time of Delivery for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus, or in any other documents or arrangements, and the
Company agrees to file promptly any amendments to the Registration Statement or
the Prospectus which in your opinion may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall include any person substituted
under this Section with like effect as if such person had originally been a
party to this Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a)
-22-
above, the aggregate number of such Shares which remains unpurchased does not
exceed one-eleventh of the aggregate number of all the Shares to be purchased at
such Time of Delivery, then the Company shall have the right to require each
non-defaulting Underwriter to purchase the number of shares which such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of Shares which such Underwriter agreed to purchase
hereunder) of the Shares of such defaulting Underwriter or Underwriters for
which such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Shares of a defaulting Underwriter or Underwriters by you and the Company as
provided in subsection (a) above, the aggregate number of such Shares which
remains unpurchased exceeds one-eleventh of the aggregate number of all the
Shares to be purchased at such Time of Delivery, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Shares of a defaulting Underwriter or Underwriters,
then this Agreement (or, with respect to the Second Time of Delivery, the
obligations of the Underwriters to purchase and of the Company to sell the
Optional Shares shall thereupon terminate, without liability on the part of any
non-defaulting Underwriter or the Company, except for the expenses to be borne
by the Company and the Underwriters as provided in Section 6 hereof and the
indemnity and contribution agreements in Section 8 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Shares.
11. If this Agreement shall be terminated pursuant to Section 9 hereof,
the Company shall not then be under any liability to any Underwriter except as
provided in Sections 6 and 8 hereof; but, if for any other reason, any Shares
are not delivered by or on behalf of the Company as provided herein, the Company
will reimburse the Underwriters through you for all out-of-pocket expenses
approved in writing by you, including fees and disbursements of counsel,
reasonably incurred by the Underwriters in making preparations for the purchase,
sale and delivery of the Shares not so delivered, but the Company shall then be
under no further liability to any Underwriter except as provided in Sections 6
and 8 hereof.
12. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by Xxxxxxx, Sachs & Co. on behalf of you as the
representatives.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the representatives in care of Xxxxxxx, Xxxxx &
Co., 00 Xxx Xxxx, 00xx Xxxxx, Xxx Xxxx,
-00-
Xxx Xxxx 00000, Attention: Registration Department; and if to the Company shall
be delivered or sent by mail to the address of the Company set forth in the
Registration Statement, Attention: Secretary; provided, however, that any notice
to an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by
mail, telex or facsimile transmission to such Underwriter at its address set
forth in its Underwriters' Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by you upon
request. Any such statements, requests, notices or agreements shall take effect
upon receipt thereof.
13. This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, the Company and, to the extent provided in Sections 8 and
10 hereof, the officers and directors of the Company and each person who
controls the Company or any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. No purchaser of any of the
Shares from any Underwriter shall be deemed a successor or assign by reason
merely of such purchase.
14. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and the same
instrument.
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If the foregoing is in accordance with your understanding, please sign and
return to us six counterparts hereof, and upon the acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof shall
constitute a binding agreement between each of the Underwriters and the Company.
It is understood that your acceptance of this letter on behalf of each of the
Underwriters is pursuant to the authority set forth in a form of Agreement among
Underwriters, the form of which shall be submitted to the Company for
examination upon request, but without warranty on your part as to the authority
of the signers thereof.
Very truly yours,
ALLSCRIPTS, INC.
By: ________________________________
Name:
Title:
Accepted as of the date hereof:
Xxxxxxx, Sachs & Co.
Bear, Xxxxxxx & Co. Inc.
CIBC World Markets Corp.
By: _______________________________________
(Xxxxxxx, Sachs & Co.)
On behalf of each of the Underwriters
-25-
SCHEDULE I
NUMBER OF OPTIONAL
SHARES TO BE
TOTAL NUMBER OF PURCHASED IF
FIRM SHARES MAXIMUM OPTION
UNDERWRITER TO BE PURCHASED EXERCISED
-------------------------- --------------- ------------------
Xxxxxxx, Xxxxx & Co.......
Bear, Xxxxxxx & Co. Inc...
CIBC World Markets Corp...
--------------- ------------------
Total................
=============== ==================
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ANNEX I
Pursuant to Section 7(d) of the Underwriting Agreement, the accountants shall
furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect
to the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if applicable,
financial forecasts and/or pro forma financial information) examined by
them and included in the Prospectus or the Registration Statement comply as
to form in all material respects with the applicable accounting
requirements of the Act and the related published rules and regulations
thereunder; and, if applicable, they have made a review in accordance with
standards established by the American Institute of Certified Public
Accountants of the unaudited consolidated interim financial statements,
selected financial data, pro forma financial information, financial
forecasts and/or condensed financial statements derived from audited
financial statements of the Company for the periods specified in such
letter, as indicated in their reports thereon, copies of which have been
separately furnished to the representatives of the Underwriters (the
"Representatives");
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of
the unaudited condensed consolidated statements of income, consolidated
balance sheets and consolidated statements of cash flows included in the
Prospectus as indicated in their reports thereon copies of which have been
separately furnished to the Representatives and on the basis of specified
procedures including inquiries of officials of the Company who have
responsibility for financial and accounting matters regarding whether the
unaudited condensed consolidated financial statements referred to in
paragraph (vi)(A)(i) below comply as to form in all material respects with
the applicable accounting requirements of the Act and the related published
rules and regulations, nothing came to their attention that cause them to
believe that the unaudited condensed consolidated financial statements do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the related published rules and
regulations;
(iv) The unaudited selected financial information with respect to
the consolidated results of operations and financial position of the
Company for the five most recent fiscal years included in the Prospectus
agrees with the corresponding amounts (after restatements where applicable)
in the audited consolidated financial statements for such five fiscal
years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and on
the basis of limited procedures specified in such letter nothing came to
their attention as a result of the foregoing procedures that caused them to
believe that this information does not
-27-
conform in all material respects with the disclosure requirements of Items
301, 302, and 402, respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of the
minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included in the Prospectus, inquiries
of officials of the Company and its subsidiaries responsible for financial
and accounting matters and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention that caused them
to believe that:
(A) (i) the unaudited consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the Act and
the related published rules and regulations, or (ii) any material
modifications should be made to the unaudited condensed consolidated
statements of income, consolidated balance sheets and consolidated
statements of cash flows included in the Prospectus for them to be in
conformity with generally accepted accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited consolidated
financial statements included in the Prospectus;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived any unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in clause (B) were not determined on a
basis substantially consistent with the basis for the audited
consolidated financial statements included in the Prospectus;
(D) any unaudited pro forma consolidated condensed financial
statements included in the Prospectus do not comply as to form in all
material respects with the applicable accounting requirements of the
Act and the published rules and regulations thereunder or the pro
forma adjustments have not been properly applied to the historical
amounts in the compilation of those statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the consolidated
capital stock (other than issuances of capital stock upon exercise of
options and stock
-28-
appreciation rights, upon earn-outs of performance shares and upon
conversions of convertible securities, in each case which were
outstanding on the date of the latest financial statements included in
the Prospectus) or any increase in the consolidated long-term debt of
the Company and its subsidiaries, or any decreases in consolidated net
current assets or stockholders' equity or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with amounts shown in the
latest balance sheet included in the Prospectus, except in each case
for changes, increases or decreases which the Prospectus discloses
have occurred or may occur or which are described in such letter; and
(F) for the period from the date of the latest financial
statements included in the Prospectus to the specified date referred
to in clause (E) there were any decreases in consolidated net revenues
or operating profit or the total or per share amounts of consolidated
net income or other items specified by the Representatives, or any
increases in any items specified by the Representatives, in each case
as compared with the comparable period of the preceding year and with
any other period of corresponding length specified by the
Representatives, except in each case for decreases or increases which
the Prospectus discloses have occurred or may occur or which are
described in such letter; and
(vii) In addition to the examination referred to in their report(s)
included in the Prospectus and the limited procedures, inspection of minute
books, inquiries and other procedures referred to in paragraphs (iii) and
(vi) above, they have carried out certain specified procedures, not
constituting an examination in accordance with generally accepted auditing
standards, with respect to certain amounts, percentages and financial
information specified by the Representatives, which are derived from the
general accounting records of the Company and its subsidiaries, which
appear in the Prospectus, or in Part II of, or in exhibits and schedules
to, the Registration Statement specified by the Representatives, and have
compared certain of such amounts, percentages and financial information
with the accounting records of the Company and its subsidiaries and have
found them to be in agreement.
-29-
