1
Exhibit 99(a)
CARDINAL HEALTH, INC.
PLACEMENT AGENCY AGREEMENT
February 2, 0000
Xxxx xx Xxxxxxx Securities LLC
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Dear Sirs:
Cardinal Health, Inc., an Ohio corporation (the "COMPANY"), proposes to
issue and sell an aggregate of up to 500,000 of its common shares, without par
value (each share, a "SECURITY" and together, the "SECURITIES"). This Agreement
sets forth the understandings and agreements between the Company and you
(hereinafter sometimes referred to as the "PLACEMENT AGENT") pursuant to which
you, as agent for the Company, shall offer and arrange for the sale of the
Securities as herein set forth.
From time to time, the Company and the Placement Agent may enter into
an Addendum, substantially in the form of Exhibit 1 (each, an "ADDENDUM"), to
this Agreement which provides for the terms of the sale of all or a part of the
Securities, including the name of the investor (each, an "INVESTOR"), the amount
of securities to be issued and sold by the Company to such Investor, the amount
such Investor will pay the Company per Security subscribed for, the date
mutually agreed upon by the Company and the Placement Agent (such date not later
than February 14, 2001) for the closing (each, a "CLOSING") of the sale of the
Securities (each, a "CLOSING DATE"), and such other terms as may be agreed upon
by the Company and the Placement Agent. References herein to this Agreement
shall be deemed to refer to this Agreement as supplemented by any Addendum.
The common shares, without par value, of the Company to be outstanding
after giving effect to the proposed sales (each, a "PLACEMENT") are hereinafter
referred to as the "COMMON SHARES". The Company shall deliver to you for
delivery to each Investor prior to the receipt of the consideration a Final
Prospectus (as defined below).
1. Representations and Warranties. The Company represents and warrants
to, and agrees with, the Placement Agent that:
2
(a) The Company meets the requirements for use of Form S-3
under the Securities Act of 1933 (the "ACT") and has filed with the
Securities and Exchange Commission (the "COMMISSION") a registration
statement on such Form (Registration File No. 333-46482), which has
become effective, for the registration under the Act of the Securities.
Such registration statement meets the requirements set forth in Rule
415(a)(1)(x) under the Act and complies in all other material respects
with said Rule. The Company proposes to file with the Commission
pursuant to Rule 424(b) under the Act one or more supplements to the
form of prospectus included in such registration statement relating to
a Placement of the Securities and the plan of distribution thereof and
has previously advised you of all further information (financial and
other) with respect to the Company to be set forth therein. Such
registration statement, including the exhibits thereto, as amended at
the date of this Agreement, is hereinafter called the "REGISTRATION
STATEMENT"; such prospectus in the form in which it appears in the
Registration Statement No. 333-46482 is hereinafter called the "BASIC
PROSPECTUS"; and each such supplemented form of prospectus, in the form
in which it shall be filed with the Commission pursuant to Rule 424(b)
(including the Basic Prospectus as so supplemented) is hereinafter
called a "FINAL PROSPECTUS". Any preliminary form of the Final
Prospectus which has heretofore been filed pursuant to Rule 424(b) is
hereinafter called the "PRELIMINARY FINAL PROSPECTUS". Any reference
herein to the Registration Statement, the Basic Prospectus, any
Preliminary Final Prospectus or any Final Prospectus shall be deemed to
refer to and include the documents incorporated by reference therein
(the "INCORPORATED DOCUMENTS") pursuant to Item 12 of Form S-3 which
were filed under the Securities Exchange Act of 1934 (the "EXCHANGE
ACT") on or before the date of this Agreement, or the issue date of the
Basic Prospectus, any Preliminary Final Prospectus or any Final
Prospectus, as the case may be; and any reference herein to the terms
"AMEND", "AMENDMENT" or "SUPPLEMENT" with respect to the Registration
Statement, the Basic Prospectus, any Preliminary Final Prospectus or
any Final Prospectus shall be deemed to refer to and include the filing
of any document under the Exchange Act after the date of this
Agreement, or the issue date of the Basic Prospectus, any Preliminary
Final Prospectus or any Final Prospectus, as the case may be, deemed to
be incorporated therein by reference.
3
(b) As of the date hereof, when a Final Prospectus is first
filed pursuant to Rule 424(b) under the Act, when, prior to the Closing
Date, any amendment to the Registration Statement becomes effective
(including the filing of any document incorporated by reference in the
Registration Statement), when any supplement to a Final Prospectus is
filed with the Commission and at the Closing Date, (i) the Registration
Statement, as amended as of any such time, and a Final Prospectus, as
amended or supplemented as of any such time, will comply in all
material respects with the applicable requirements of the Act and the
Exchange Act and the respective rules thereunder and (ii) neither the
Registration Statement, as amended as of any such time, nor a Final
Prospectus, as amended or supplemented as of any such time, will
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to
make the statements therein not misleading; provided, that the Company
makes no representations or warranties as to the information contained
in or omitted from the Registration Statement or a Final Prospectus or
any amendment thereof or supplement thereto in reliance upon and in
conformity with information furnished in writing to the Company by or
on behalf of the Placement Agent specifically for use in the
Registration Statement or a Final Prospectus.
(c) The Company is a corporation duly organized and validly
existing in good standing under the laws of the State of Ohio with
corporate power and authority to own and hold under lease its
properties and conduct its business as described in a Final Prospectus
and holds all material licenses and is duly qualified to conduct the
business in which it is engaged in each jurisdiction or place where the
conduct of its business requires such licenses or qualification and
where the failure to be so licensed or qualified would not have a
material adverse effect on the business or financial condition of the
Company and its subsidiaries taken as a whole (a "MATERIAL ADVERSE
EFFECT").
(d) Each of the Company's significant subsidiaries (as
defined in Rule 405 under the Act) is duly organized and validly
existing in good standing under the laws of the jurisdiction of its
incorporation with corporate power and authority to own and hold under
lease its properties and to conduct its business as described in a
Final Prospectus.
4
(e) The authorized capital stock of the Company conforms as
to legal matters to the description thereof contained in a Final
Prospectus.
(f) The Common Shares outstanding prior to the issuance of
the Securities have been duly authorized and are validly issued, fully
paid and non-assessable.
(g) The Securities have been duly authorized and, when issued
and delivered to the Investors against payment therefor in accordance
with the terms of this Agreement, will be validly issued, fully paid
and non-assessable, and the issuance of such Securities will not be
subject to any preemptive or similar rights.
(h) There are no legal or governmental proceedings pending,
or to the knowledge of the Company threatened, which are required to be
described in the Registration Statement or a Final Prospectus which are
not described as required, and there is no contract or document of a
character required to be described in the Registration Statement or a
Final Prospectus or to be filed as an exhibit to the Registration
Statement or any Incorporated Document which is not described or filed
as required.
(i) The Company is not in violation of its charter or code of
regulations or in default in the performance of any obligation,
agreement or condition contained in any bond, debenture, note or any
other evidence of indebtedness or in any indenture, material lease or
loan agreement, except where any default would not have a Material
Adverse Effect. The issue and sale of the Securities, the execution and
delivery of this Agreement, the performance of the obligations of the
Company set forth herein and the consummation of the transactions
contemplated hereby will not conflict with or constitute a breach of,
or default under, the charter or code of regulations of the Company or
any of its subsidiaries, any agreement, indenture or other instrument
to which the Company or any of its subsidiaries is a party or by which
any of them or any of their property is bound, or any law,
administrative regulation or court decree applicable to the Company or
any of its subsidiaries, except where any breach or default would not
have a Material Adverse Effect.
(j) Neither the execution and delivery of this Agreement, nor
the fulfillment of the terms herein set forth and the
5
consummation of the transactions herein contemplated require any
consent, approval, authorization or other order of any court,
regulatory body, administrative agency or other governmental body
(except such as have been obtained under the Act or such as may be
required under state securities or Blue Sky laws in connection with the
placement of the Securities).
(k) This Agreement has been duly authorized, executed and
delivered by the Company.
(l) The Company is not an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
(m) Xxxxxx Xxxxxxxx LLP, PricewaterhouseCoopers LLP and
Deloitte & Touche LLP, who have certified the financial statements and
supporting schedules included in the Registration Statement as
described under "Experts", are each independent public accountants with
respect to the entities and for the periods they have audited as
required by the Act.
2. Sale, Delivery and Payment of Securities. (a) On the basis of the
representations, warranties and covenants herein contained, but subject to the
terms and conditions herein set forth, the Company hereby appoints you as its
placement agent and grants you, as agent for the Company, the exclusive right to
offer and arrange for the sale of the Securities as herein set forth. Subject to
the performance by the Company of its obligations hereunder, and to the
completeness and accuracy of all of the representations and warranties contained
herein, the Placement Agent hereby accepts such appointment and agrees to use
all reasonable efforts to find suitable Investors for the Securities.
(b) On any Closing Date, Banc of America Securities LLC shall act as a
broker-dealer in arranging for and facilitating the sale by the Company and the
purchase by the Investors of the Securities set forth in the Addendum at the
purchase price per Security set forth therein. Payment for the Securities will
be made by certified or official bank check or checks drawn in federal funds or
similar same day funds or by wire transfer in same day funds.
The Company shall instruct the Company's transfer agent to register
certificates for the Securities in such names and in such denominations as the
Investors may request.
6
(c) The Company will pay to the Placement Agent, or its affiliates, on
each Closing Date a commission equal to $0.06 per Common Share from the sale of
the Securities set forth in the applicable Addendum to Investors on such Closing
Date.
3. Agreements. The Company agrees with the Placement Agent that:
(a) Prior to the later of (i) termination of the offering of
the Securities as determined by the Placement Agent and as evidenced by
written notice thereof to the Company from the Placement Agent or (ii)
any Closing Date, the Company will not file any amendment of the
Registration Statement or supplement (including any Final Prospectus
but excluding any prospectus supplement relating to a subsequent
issuance of securities) to the Basic Prospectus unless the Company has
furnished the Placement Agent a copy for the Placement Agent's review a
reasonable time prior to filing thereof. Subject to the foregoing
sentence, the Company will cause each Final Prospectus to be filed with
the Commission pursuant to Rule 424(b) under the Act. The Company will
promptly advise the Placement Agent (i) when a Final Prospectus shall
have been filed with the Commission pursuant to Rule 424(b), (ii) when
any amendment to the Registration Statement relating to the Securities
shall have become effective, (iii) of any request by the Commission for
any amendment of the Registration Statement or amendment of or
supplement to any Final Prospectus or for any additional information,
(iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose and (v) of the receipt
by the Company of any notification with respect to the suspension of
the qualification of the Securities for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose. The
Company will use all reasonable efforts to prevent the issuance of any
such stop order and, if issued, to obtain as soon as possible the
withdrawal thereof.
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which the Final Prospectus relating to any Placement as
then amended or supplemented would include any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading, or if it
7
shall be necessary to amend or supplement such Final Prospectus to
comply with the Act or the Exchange Act or the respective rules
thereunder, the Company promptly will prepare and file with the
Commission, subject to the first sentence of paragraph 3(a) of this
Section 3, an amendment or supplement which will correct such statement
or omission or an amendment which will effect such compliance.
(c) The Company will make generally available within the
meaning of Section 11(a) of the Act to its security holders an earning
statement, which need not be audited, covering a twelve-month period
commencing after the date of this Agreement and ending not later than
15 months thereafter as soon as practicable following the end of such
period, which earning statement shall satisfy the provisions of Section
11(a) of the Act and may consist of earning statements covering
successive fiscal quarters.
(d) The Company will furnish to the Placement Agent and
counsel for the Placement Agent, without charge, copies of the
Registration Statement (including exhibits thereto) and each amendment
thereto which shall become effective on or prior to the Closing Date of
the applicable Placement and, so long as delivery of a prospectus by an
underwriter or dealer may be required by the Act, as many copies of any
Preliminary Final Prospectus and Final Prospectus and any amendments
thereof and supplements thereto as the Placement Agent may reasonably
request. The Company will pay the expenses of printing all documents
relating to the offering unless otherwise agreed with the Placement
Agent.
(e) The Company will arrange for the qualification of the
Securities for sale under the laws of such jurisdictions as the
Placement Agent may reasonably designate and will maintain such
qualifications in effect so long as required for the distribution of
the Securities; provided that in no event shall the Company be
obligated to qualify to do business in any jurisdiction where it is not
now so qualified or to take any action that would subject it to the
service of process in suits, other than those arising out of the
offering or sale of the Securities, in any jurisdiction where it is not
now so subject.
4. Conditions to the Obligations of the Placement Agent. The
obligations of the Placement Agent hereunder shall be subject to the accuracy in
all material respects of the representations and warranties on the part of the
8
Company contained herein as of the date hereof, as of the date of the
effectiveness of any amendment to the Registration Statement filed prior to the
applicable Closing Date (including the filing of any document incorporated by
reference therein) and as of the applicable Closing Date, to the accuracy of the
statements of the Company made in any certificates delivered pursuant to the
provisions hereof, to the performance by the Company of its obligations
hereunder and to the following additional conditions:
(a) No stop order suspending the effectiveness of the
Registration Statement, as amended from time to time, shall have been
issued and no proceedings for that purpose shall have been instituted
or threatened, and a Final Prospectus shall have been filed with the
Commission not later than 5:00 P.M., New York City time, on the second
Business Day following the date of the Addendum.
(b) The Company shall have furnished to the Placement Agent
the opinion of Xxxxx & Xxxxxxxxx LLP, counsel to the Company, dated the
applicable Closing Date, to the effect that:
(i) the Company is a corporation duly incorporated,
validly existing and in good standing under the laws of the
State of Ohio;
(ii) each significant subsidiary of the Company is a
corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation;
(iii) except for permits and similar authorizations
required under the securities or Blue Sky laws of certain
jurisdictions (as to which such counsel need not express an
opinion), no consent, approval, authorization or other order
of any regulatory body, administrative agency or other
governmental body is legally required for the valid placement
and sale of the Securities to the Investors in the manner
contemplated by this Agreement;
(iv) this Agreement has been duly authorized,
executed and delivered by the Company;
(v) the authorized capital stock of the Company
conforms in all material respects as to legal matters to the
9
description thereof contained in the Final Prospectus under
the caption "Description of Common Shares" in the Basic
Prospectus and "Supplemental Description of Common Shares" in
the applicable Final Prospectus;
(vi) the Securities have been duly authorized and,
when issued and delivered to the Investors against payment
therefor in accordance with the terms of this Agreement, will
be validly issued, fully paid and non-assessable, and the
issuance of such Securities will not be subject to any
preemptive or similar rights;
(vii) the Registration Statement and all
post-effective amendments, if any, have become effective under
the Act, and, to the best of the knowledge of such counsel, no
stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for such purpose
are pending before or contemplated by the Commission and the
filing of the applicable Final Prospectus pursuant to Rule
424(b) has been made in accordance with Rule 424(b);
(viii)(1) each of the Incorporated Documents
complies as to form in all material respects with the Exchange
Act and the rules and regulations of the Commission thereunder
and (2) the Registration Statement and the applicable Final
Prospectus and any supplements or amendments thereto
(including the Incorporated Documents) comply as to form in
all material respects with the Act;
(ix) the statements in the applicable Final
Prospectus under the captions "Description of Common Shares"
and "Supplemental Description of Common Shares," insofar as
such statements constitute a summary of the documents and
other legal matters referred to therein, fairly present the
information called for by the Act with respect to such
documents and other legal matters;
(x) there are no legal or governmental proceedings
known to such counsel pending or threatened required to be
described in the Registration Statement or the applicable
Final Prospectus which are not described as
10
required, and there is no contract or document known to such
counsel of a character required to be described in the
Registration Statement or the applicable Final Prospectus or
to be filed as an exhibit to the Registration Statement which
is not described or filed as required; and
(xi) the execution, delivery and performance of this
Agreement, compliance by the Company with all provisions
hereof and the consummation by the Company of the transactions
contemplated hereby do not conflict with or constitute a
breach of any of the terms or provisions of, or a default
under, the certificate or articles of incorporation or bylaws
or code of regulations of the Company or any of its
significant subsidiaries or any agreement, indenture or other
instrument known to such counsel to which the Company or any
of its significant subsidiaries is a party or by which any of
them is bound which conflict or default would have a Material
Adverse Effect, or (assuming compliance with all applicable
state securities and Blue Sky laws and without opining as to
the enforceability of rights of indemnity or contribution
under applicable law) violate any law, administrative
regulation or ruling or court decree known to such counsel
applicable to the Company or any of its significant
subsidiaries or any of their respective property which
violation would have a Material Adverse Effect.
In rendering the opinion set forth above, Xxxxx & Xxxxxxxxx
LLP may (A) assume the genuineness without independent investigation,
of all signatures on all documents examined by such firm, the
conformity to original documents of all documents submitted to such
firm as certified or facsimile copies and the authenticity of all such
documents; and (B) rely as to matters of law of any State other than
Ohio upon the opinion of counsel licensed to practice in such state and
satisfactory to the Placement Agent (provided that such opinion shall
state that the Placement Agent and Xxxxx & Xxxxxxxxx LLP are entitled
to so rely) and as to certain matters of fact, upon certificates and
written statements of officers and employees of, and accountants for,
the Company.
Such counsel shall have also furnished to the Placement Agent
a written statement dated the applicable Closing Date to the effect
that, based upon their participation in the preparation of the
11
Registration Statement and the applicable Final Prospectus and any
amendments and supplements thereto and upon their review and discussion
of the contents thereof, but without independent check or verification
except as specified, nothing has come to such counsel's attention which
would lead them to believe that the Registration Statement at the time
it became effective and at the date of the applicable Addendum
contained any untrue statement of any material fact or omitted to state
any material fact required to be stated therein or necessary to make
the statements therein not misleading or that the Final Prospectus (as
amended or supplemented, if applicable) contains any untrue statement
of a material fact or omits to state any material fact necessary in
order to make the statements therein, in light of the circumstances
under which they were made, not misleading. Such counsel may state
that, in rendering the opinion in (viii) above and the written
statement referred to in the preceding sentence, they are not
expressing any opinion on the financial statements and financial
exhibits and other financial data included therein or omitted therefrom
and that they are not responsible for the adequacy or accuracy of the
derivation or compilation from the Company's accounting records of the
financial data included in the Registration Statement or the applicable
Final Prospectus and any amendments and supplements thereto.
(c) The Placement Agent shall have received from Xxxxx Xxxx &
Xxxxxxxx, counsel for the Placement Agent, such opinion or opinions,
dated the applicable Closing Date, with respect to the placement of the
Securities, the Registration Statement, the applicable Final Prospectus
and other related matters as the Placement Agent may reasonably
require, and the Company shall have furnished to such counsel such
documents as they reasonably request for the purpose of enabling them
to pass upon such matters. In rendering their opinion, Xxxxx Xxxx &
Xxxxxxxx may rely on the opinion of Xxxxx & Xxxxxxxxx referred to in
paragraph (b) above as to all matters of Ohio law.
(d) The Company shall have furnished to the Placement Agent a
certificate of the Company signed by the Chairman of the Board, the
President or any Vice President of the Company dated the applicable
Closing Date, to the effect that:
(i) the representations and warranties of the Company
in this Agreement are true and correct in all
12
material respects on and as of the applicable Closing Date
with the same effect as if made on such Closing Date and the
Company has complied with all the agreements and satisfied all
the conditions on its part to be performed or satisfied at or
prior to such Closing Date;
(ii) no stop order suspending the effectiveness of
the Registration Statement, as amended, has been issued and no
proceedings for that purpose have been instituted or, to the
Company's knowledge, threatened; and
(iii) since the date of the most recent financial
statements included in the applicable Final Prospectus, there
has been no material adverse change in the financial
condition, earnings, business, properties or results of
operations of the Company and its subsidiaries on a
consolidated basis, whether or not arising from transactions
in the ordinary course of business, except as set forth in or
contemplated in such Final Prospectus.
(e) At the applicable Closing Date, Xxxxxx Xxxxxxxx LLP and
Deloitte & Touche LLP shall have furnished to the Placement Agent a
letter or letters (which may refer to letters previously delivered to
the Placement Agent, a copy of which shall be attached, in which case
the letter provided at the applicable Closing Date shall state that the
previous letter can be relied on), dated such Closing Date, in form and
substance satisfactory to the Placement Agent, containing statements
and information of the type ordinarily included in accountants'
"comfort letters" with respect to the financial statements and certain
financial information contained in or incorporated by reference in the
applicable Final Prospectus.
(f) Subsequent to the respective dates as of which
information is given in the Registration Statement and the applicable
Final Prospectus and prior to the applicable Closing Date, there shall
not have been any change, or any development involving a prospective
change, in or affecting the business, properties or results of
operations of the Company and its subsidiaries on a consolidated basis,
the effect of which is, in the reasonable judgment of the Placement
Agent, so material and adverse as to make it impractical to proceed
with the Placement.
13
(g) Prior to the applicable Closing Date, the Company shall
have furnished to the Placement Agent such further information,
certificates and documents as the Placement Agent may reasonably
request.
(h) For the convenience of the parties, after the first
Closing Date, any certificate, letter or opinion to be delivered
pursuant to this Section 4 on any subsequent Closing Date, may be in
the form of a "bring-down" certificate, letter or opinion in a form
reasonably satisfactory to Xxxxx Xxxx & Xxxxxxxx.
If any of the conditions specified in this Section 4 shall not have
been fulfilled to the reasonable satisfaction of the Placement Agent when and as
provided in this Agreement, or if any of the opinions and certificates mentioned
above or elsewhere in this Agreement shall not be to the reasonable satisfaction
of the Placement Agent and its counsel, this Agreement and all obligations of
the Placement Agent hereunder may be canceled at, or at any time prior to, the
applicable Closing Date by the Placement Agent. Notice of such cancellation
shall be given to the Company by telephone or in the manner described in Section
10 hereof.
5. Expenses. (a) The Company covenants and agrees with the Placement
Agent 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 Securities under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Final Prospectus and any Final
Prospectus and amendments and supplements thereto and the mailing and delivery
of copies thereof to brokers, dealers and Investors; (ii) the cost of printing
this Agreement, any blue sky and legal investment memoranda and any other
documents in connection with the offering, purchase, sale and delivery of the
Securities; (iii) all expenses in connection with the qualification of the
Securities for offering and sale under state securities laws, including the
reasonable fees and disbursements of counsel for the Placement Agent in
connection with such qualification and in connection with any blue sky and legal
investment surveys; (iv)the cost of preparing the Securities; (v) the reasonable
fees and expenses incurred in connection with legal services rendered to the
Placement Agent by Xxxxx Xxxx & Xxxxxxxx in connection with the offering of the
Securities; (vi) fees and expenses of the registrar for the Common Shares; and
(vii) all other costs and expenses incident to the performance of its
obligations hereunder which are not otherwise specifically provided for in this
Section. In addition, the Company shall reimburse the Placement Agent for all
reasonable out-of-pocket costs and
14
expenses incurred by it or its affiliates in connection with the transactions
contemplated by this Agreement
6. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless the Placement Agent and each person who controls the
Placement Agent within the meaning of either Section 15 of the Act or Section 20
of the Exchange Act against any and all losses, claims, damages or liabilities,
joint or several, to which they or any of them may become subject, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement for the registration
of the Securities as originally filed or in any amendment thereof, or in the
Basic Prospectus, any Preliminary Final Prospectus or any Final Prospectus, or
in any amendment thereof 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 agrees to reimburse each such indemnified party for any legal or other
expenses reasonably incurred by them as such expenses are incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company will 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 any such untrue statement or alleged untrue
statement or omission or alleged omission made therein in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
the Placement Agent specifically for use therein. This indemnity agreement will
be in addition to any liability which the Company may otherwise have.
(b) The Placement Agent agrees to indemnify and hold harmless the
Company, each of its directors, each of its officers who signs the Registration
Statement, and each person who controls the Company within the meaning of either
Section 15 of the Act or Section 20 of the Exchange Act, to the same extent as
the foregoing indemnity from the Company to the Placement Agent, but only with
reference to written information relating to the Placement Agent furnished to
the Company by or on behalf of the Placement Agent specifically for use in the
documents referred to in the foregoing indemnity. This indemnity agreement will
be in addition to any liability which the Placement Agent may otherwise have.
The Company acknowledges that the statements set forth in the second to last
paragraph under the heading "Plan of Distribution" concerning stabilization in
any Preliminary Final Prospectus or Final Prospectus constitute the only
information furnished in writing by or on behalf of the Placement Agent for
inclusion in the documents referred to in the foregoing indemnity and the
Placement Agent hereby confirms that such statements are correct.
15
(c) Promptly after receipt by an indemnified party under this Section
6 of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 6, notify the indemnifying party in writing of the commencement thereof,
but the omission so to notify the indemnifying party will not relieve it from
any liability which it may have to any indemnified party under this Section 6 to
the extent it is not prejudiced as a proximate result of such omission. In case
any such action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein, and to the extent that it may elect by written
notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof, with counsel
satisfactory to such indemnified party; provided, however, that if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of its election so to assume the defense of such action and approval by
the indemnified party of counsel (which shall not be unreasonably withheld or
delayed), the indemnifying party will not be liable to such indemnified party
under this Section 6 for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that the
indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for the fees and expenses of more than one
separate counsel (in addition to any local counsel), approved by the Placement
Agent in the case of paragraph (a) of this Section 6, representing the
indemnified parties under such paragraph (a) who are parties to such action),
(ii) the indemnifying party shall not have employed counsel reasonably
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party; and except that, if clause (i)
or (iii) is applicable, such liability shall be only in respect of the counsel
referred to in such clause (i) or (iii). The indemnifying party shall not be
liable for any settlement of any such action effected without its written
consent, but if settled with its written consent, or if there be a final
judgment for the plaintiff in any such action, the indemnifying
16
party agrees to indemnify the indemnified parties against any loss or liability
by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 6 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 Placement
Agent on the other from the placement of the Securities. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law, 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 Placement Agent 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 Placement Agent 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 commissions received by the
Placement Agent in aggregate from the Closings. 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 Placement Agent on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Placement Agent agree that it would not be just
and equitable if contribution pursuant to this subsection (d) were determined by
pro rata allocation 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), the Placement Agent shall not be required to
contribute any amount in excess of the amount of commissions actually received
by it under this Agreement. 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.
17
7. Termination. The services of the Placement Agent hereunder may be
terminated with or without cause by either the Company or the Placement Agent at
any time and without liability or continuing obligation to the Placement Agent
or the Company, except (a) for any compensation earned by such Placement Agent
to the date of termination and (b) as set forth in the last sentence under
Section 8. The obligations of the Placement Agent as set forth herein shall
continue with respect to arranging the purchase and sale of any shares for which
an Addendum was executed prior to such termination; provided, however, that any
such obligations shall be subject to termination in the absolute discretion of
the Placement Agent, by notice given to the Company prior to delivery of and
payment for the Securities, if prior to such time (i) trading in securities
generally on the New York Stock Exchange, American Stock Exchange or The Nasdaq
National Market shall have been suspended or materially limited, (ii) a general
moratorium on commercial banking activities in New York shall have been declared
either by Federal or state authorities or (iii) there shall have occurred any
outbreak or escalation of hostilities or other international or domestic
calamity, crisis or change in political, financial or economic conditions, the
effect of which on the financial markets of the United States is such as to make
it, in the judgment of the Placement Agent, impracticable or inadvisable to
arrange for the sale of the Securities or to enforce contracts for the sale of
the Securities.
8. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Placement Agent set forth in or made pursuant
to this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of the Placement Agent or the Company or any
of the officers, directors or controlling persons referred to in Section 6
hereof, and will survive the placement of the Securities. The provisions of
Sections 5 and 6 hereof shall survive the termination or cancellation of this
Agreement.
9. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Placement Agent, will be mailed,
delivered or telexed and confirmed to it, at Banc of America Securities LLC, 000
Xxxxxxxxxx Xxxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000, Attention: Legal Department;
or, if sent to the Company, will be mailed, delivered or telexed and confirmed
to it at 0000 Xxxxxxxx Xxxxx, Xxxxxx, Xxxx 00000, Attention: Chief Legal
Officer.
10. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 6 hereof, and no
other person will have any right or obligation hereunder. The term "successors
and
18
assigns" shall not include a purchaser, in its capacity as such, of Securities
from the Investors.
11. Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York.
19
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement between the
Company and the Placement Agent.
Very truly yours,
CARDINAL HEALTH, INC.
By: /s/ X.X. Xxxxxx
---------------
Title: Executive Vice President
The foregoing Agreement is
hereby confirmed and accepted
as of the date first specified above.
BANC OF AMERICA SECURITIES LLC
By: /s/ Xxxxx Xxxxx
----------------
Title: Managing Director
20
EXHIBIT 1
ADDENDUM NO. ___ TO
PLACEMENT AGENCY AGREEMENT
DATED AS OF FEBRUARY ___, 2001 BETWEEN
CARDINAL HEALTH, INC. AND
BANC OF AMERICA SECURITIES LLC
February ___, 2001
Reference is hereby made to the Placement Agency Agreement dated as of
February ___, 2001 between Cardinal Health, Inc. and Banc of America Securities
LLC (the "PLACEMENT AGENCY AGREEMENT") which shall be deemed incorporated into
this Addendum. Pursuant to the second paragraph of the Placement Agency
Agreement, the terms of this Placement shall be as follows:
Name of Investor Number of Shares Subscription Price Per Share Closing Date
---------------- ---------------- ---------------------------- ------------
[INSERT OTHER TERMS, IF ANY]
Terms defined in the Placement Agency Agreement and not otherwise
defined herein are used herein as therein defined.
This Addendum shall be governed by and construed in accordance with the
laws of the State of New York.
Accepted and agreed:
CARDINAL HEALTH, INC.
By:
----------------------------
Title:
BANC OF AMERICA SECURITIES LLC,
as Placement Agent
By:
----------------------------
Title:
