Exhibit 1.1
DRAFT 10/2/97
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2,000,000 Shares*
PRIORITY HEALTHCARE CORPORATION
Class B Common Stock
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UNDERWRITING AGREEMENT
St. Petersburg, Florida
, 1997
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc.
Wheat, First Securities, Inc.
As Representatives of the Several Underwriters
c/o Raymond ▇▇▇▇▇ & Associates, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Priority Healthcare Corporation, an Indiana corporation (the "Company"),
proposes, subject to the terms and conditions stated herein, to issue and sell
an aggregate of 2,000,000 shares of Class B Common Stock, $.01 par value per
share (the "Class B Common Stock"), of the Company, to the several Underwriters
named in Schedule I hereto (the "Underwriters"), subject to the terms and
conditions stated herein (such 2,000,000 aggregate shares to be sold by the
Company are hereinafter referred to as the "Firm Shares"). In addition, the
Company has agreed to sell to the Underwriters, upon the terms and conditions
set forth herein, up to an additional 300,000 shares (the "Additional Shares")
of the Class B Common Stock to cover over-allotments by the Underwriters, if
any. The Firm Shares and the Additional Shares are hereinafter collectively
referred to as the "Shares."
Bindley Western Industries, Inc. ("BWI") owns all of the issued and
outstanding shares of Class A Common Stock of the Company and is entering into
this Agreement as an inducement to the Underwriters.
The Company wishes to confirm as follows its agreement with you and the
other several Underwriters, on whose behalf you are acting, in connection with
the several purchases of the Shares from the Company.
1. Registration Statement and Prospectus. The Company has prepared and
filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder (collectively, the
"Act"), a registration statement on Form S-1 (File No. 333-34463), including a
prospectus subject to completion, relating to the Shares. Such registration
statement, as amended at the time when it becomes effective and as thereafter
amended by post-effective amendment, is referred to in this Agreement as the
"Registration Statement." The
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* Plus an additional 300,000 shares subject to Underwriters' over-allotment
option
prospectus in the form included in the Registration Statement, or, if the
prospectus included in the Registration Statement omits information in reliance
upon Rule 430A under the Act and such information is included in a prospectus
filed with the Commission pursuant to Rule 424(b) under the Act or as part of a
post-effective amendment to the Registration Statement after the Registration
Statement becomes effective, the prospectus as so filed, is referred to in this
Agreement as the "Prospectus." If the Company elects to rely on Rule 434 under
the Act, all references to the Prospectus shall be deemed to include, without
limitation, the form of prospectus and the term sheet contemplated by Rule 434,
taken together, provided to the Underwriters by the Company in reliance on Rule
434 under the Act (the "Rule 434 Prospectus"). If the Company files another
registration statement with the Commission to register a portion of the Shares
pursuant to Rule 462(b) under the Act (the "Rule 462 Registration Statement"),
then any reference to "Registration Statement" herein shall be deemed to include
the registration statement on Form S-1 (File No. 333-34463) and the Rule 462
Registration Statement, as each such registration statement may be amended
pursuant to the Act. The prospectus subject to completion in the form included
in the Registration Statement at the time of the initial filing of such
Registration Statement with the Commission and as such prospectus is amended
from time to time until the date of the Prospectus are collectively referred to
in this Agreement as the "Prepricing Prospectus."
2. Agreements to Sell and Purchase. The Company hereby agrees to sell the
Firm Shares to the Underwriters and, upon the basis of the representations,
warranties and agreements of the Company herein contained and subject to all the
terms and conditions set forth herein, each Underwriter agrees, severally and
not jointly, to purchase from the Company at a purchase price of $_____ per
Share (the "purchase price per Share"), the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule I hereto.
The Company hereby also agrees to sell to the Underwriters, and upon the
basis of the representations, warranties and agreements of the Company herein
contained and subject to all the terms and conditions set forth herein, the
Underwriters shall have the right for 30 days from the date of the Prospectus to
purchase from the Company up to 300,000 Additional Shares at the purchase price
per Share for the Firm Shares. The Additional Shares may be purchased solely for
the purpose of covering over-allotments, if any, made in connection with the
offering of the Firm Shares. If any Additional Shares are to be purchased, each
Underwriter, severally and not jointly, agrees to purchase the number of
Additional Shares (subject to such adjustments as you may determine to avoid
fractional shares) which bears the same proportion to the total number of
Additional Shares to be purchased by the Underwriters as the number of Firm
Shares set forth opposite the name of such Underwriter in Schedule I hereto
bears to the total number of Firm Shares.
3. Terms of Public Offering. The Company has been advised by you that the
Underwriters propose to make a public offering of their respective portions of
the Shares as soon after the Registration Statement and this Agreement have
become effective as in your judgment is advisable and initially to offer the
Shares upon the terms set forth in the Prospectus.
4. Delivery of the Shares and Payment Therefor. Delivery to the
Underwriters of the Firm Shares and payment therefor shall be made at the
offices of ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc., ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇.
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, at 10:00 a.m., St. Petersburg, Florida time, on
___________, 1997 (the "Closing Date"). The place of closing for the Firm Shares
and the Closing Date may be varied by agreement between the Representative and
the Company.
Delivery to the Underwriters of and payment for any Additional Shares to be
purchased by the Underwriters shall be made at the offices of ▇▇▇▇▇▇▇ ▇▇▇▇▇ &
Associates, Inc., ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, at 10:00 a.m.,
Florida time, on such date or dates (the "Additional Closing Date") (which may
be the same as the Closing Date but shall in no event be earlier than the
Closing Date nor earlier than three nor later than ten business days after the
giving of the notice hereinafter referred to) as shall be specified in a written
notice from you on behalf of the Underwriters to the Company of the
Underwriters' determination to purchase a number, specified in such notice, of
Additional Shares. Such notice may be given to the Company by you at any
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time within 30 days after the date of the Prospectus. The place of closing for
the Additional Shares and the Additional Closing Date may be varied by agreement
between you and the Company.
Certificates for the Firm Shares and for any Additional Shares to be
purchased hereunder shall be registered in such names and in such denominations
as you shall request prior to 1:00 p.m., Florida time, not later than the second
full business day preceding the Closing Date or the Additional Closing Date, as
the case may be. Such certificates shall be made available to you in St.
Petersburg, Florida for inspection and packaging not later than 9:30 a.m.,
Florida time, on the business day immediately preceding the Closing Date or the
Additional Closing Date, as the case may be. The certificates evidencing the
Firm Shares and any Additional Shares to be purchased hereunder shall be
delivered to you on the Closing Date or the Additional Closing Date, as the case
may be, against payment of the purchase price therefor by certified or official
bank check or checks payable in New York Clearing House (next day) funds.
Payment for the Firm Shares sold by the Company hereunder shall be delivered by
the Representative to the Company.
5. Covenants and Agreements of the Company and BWI. (a) The Company
covenants and agrees with the several Underwriters as follows:
(i) The Company will use its best efforts to cause the Registration
Statement and any amendments thereto to become effective, if it has not
already become effective, and will advise you promptly and, if requested by
you, will confirm such advice in writing (i) when the Registration
Statement has become effective and when any post-effective amendment
thereto becomes effective, (ii) if Rule 430A under the Act is employed,
when the Prospectus has been timely filed pursuant to Rule 424(b) under the
Act, (iii) of any request by the Commission for amendments or supplements
to the Registration Statement, any Prepricing Prospectus or the Prospectus
or for additional information, (iv) of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement
or of the suspension of qualification of the Shares for offering or sale in
any jurisdiction or the initiation of any proceeding for such purposes and
(v) within the period of time referred to in Section 5(e) below, of any
change in the Company's condition (financial or other), business,
prospects, properties, net worth or results of operations, or of any event
that comes to the attention of the Company that makes any statement made in
the Registration Statement or the Prospectus (as then amended or
supplemented) untrue in any material respect or that requires the making of
any additions thereto or changes therein in order to make the statements
therein not misleading in any material respect, or of the necessity to
amend or supplement the Prospectus (as then amended or supplemented) to
comply with the Act or any other law. If at any time the Commission shall
issue any stop order suspending the effectiveness of the Registration
Statement, the Company will make every reasonable effort to obtain the
withdrawal or lifting of such order at the earliest possible time. If the
Company elects to rely on Rule 434 under the Act, the Company will provide
the Underwriters with copies of the form of Rule 434 Prospectus (including
copies of a term sheet that complies with the requirements of Rule 434
under the Act), in such number as the Underwriters may reasonably request,
and file with the Commission in accordance with Rule 424(b) of the Act the
form of Prospectus complying with Rule 434(b)(2) of the Act before the
close of business on the first business day immediately following the date
hereof. If the Company elects not to rely on Rule 434 under the Act, the
Company will provide the Underwriters with copies of the form of
Prospectus, in such number as the Underwriters may reasonably request, and
file with the Commission such Prospectus in accordance with Rule 424(b) of
the Act before the close of business on the first business day immediately
following the date hereof.
(ii) The Company will furnish to you, without charge, two signed
duplicate originals of the Registration Statement as originally filed with
the Commission and of each amendment thereto, including financial
statements and all exhibits thereto, and will also furnish to you, without
charge, such number of conformed copies of the Registration Statement as
originally filed and of each amendment thereto as you may reasonably
request.
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(iii) The Company will not file any Rule 462 Registration Statement
or any amendment to the Registration Statement or make any amendment or
supplement to the Prospectus unless (A) you shall have previously been
advised thereof and been given a reasonable opportunity to review such
filing, amendment or supplement, and (B) you have not reasonably objected
to such filing, amendment or supplement after being so advised.
(iv) Prior to the execution and delivery of this Agreement, the
Company has delivered or will deliver to you, without charge, in such
quantities as you have requested or may hereafter reasonably request,
copies of each form of the Prepricing Prospectus. The Company consents to
the use, in accordance with the provisions of the Act and with the
securities or Blue Sky laws of the jurisdictions in which the Shares are
offered by the several Underwriters and by dealers, prior to the date of
the Prospectus, of each Prepricing Prospectus so furnished by the Company.
(v) As soon after the execution and delivery of this Agreement as is
practicable and thereafter from time to time for such period as in the
reasonable opinion of counsel for the Underwriters a prospectus is required
by the Act to be delivered in connection with sales by any Underwriter or a
dealer, and for so long a period as you may request for the distribution of
the Shares, the Company will deliver to each Underwriter and each dealer,
without charge, as many copies of the Prospectus (and of any amendment or
supplement thereto) as they may reasonably request. The Company consents to
the use of the Prospectus (and of any amendment or supplement thereto) in
accordance with the provisions of the Act and with the securities or Blue
Sky laws of the jurisdictions in which the Shares are offered by the
several Underwriters and by all dealers to whom Shares may be sold, both in
connection with the offering and sale of the Shares and for such period of
time thereafter as the Prospectus is required by the Act to be delivered in
connection with sales by any Underwriter or dealer. If at any time prior to
the later of (i) the completion of the distribution of the Shares pursuant
to the offering contemplated by the Registration Statement or (ii) the
expiration of prospectus delivery requirements with respect to the Shares
under Section 4(3) of the Act and Rule 174 thereunder, any event shall
occur that in the judgment of the Company or in the opinion of counsel for
the Underwriters is required to be set forth in the Prospectus (as then
amended or supplemented) or should be set forth therein in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading, or if it is necessary to supplement or amend the
Prospectus to comply with the Act or any other law, the Company will
forthwith prepare and, subject to Sections 5(a) and 5(c) hereof, file with
the Commission and use its best efforts to cause to become effective as
promptly as possible an appropriate supplement or amendment thereto, and
will furnish to each Underwriter who has previously requested Prospectuses,
without charge, a reasonable number of copies thereof.
(vi) The Company will cooperate with you and counsel for the
Underwriters in connection with the registration or qualification of the
Shares for offering and sale by the several Underwriters and by dealers
under the securities or Blue Sky laws of such jurisdictions as you may
reasonably designate and will file such consents to service of process or
other documents as may be reasonably necessary in order to effect and
maintain such registration or qualification for so long as required to
complete the distribution of the Shares; 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 which would subject
it to general service of process in suits, other than those arising out of
the offering or sale of the Shares, in any jurisdiction where it is not now
so subject. In the event that the qualification of the Shares in any
jurisdiction is suspended, the Company shall so advise you promptly in
writing.
(vii) The Company will make generally available to its security
holders a consolidated earnings statement (in form complying with the
provisions of Rule 158), which need not be audited, covering a twelve-month
period commencing after the effective date of the Registration Statement
and the Rule 462 Registration Statement, if any, and ending not later than
15 months thereafter, as soon as
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practicable after the end of such period, which consolidated earnings
statement shall satisfy the provisions of Section 11(a) of the Act.
(viii) During the period ending three years from the date hereof, the
Company will furnish to you and, upon your request, to each of the other
Underwriters, (i) as soon as available, a copy of each proxy statement,
quarterly or annual report or other report of the Company mailed to
stockholders or filed with the Commission, the National Association of
Securities Dealers, Inc. (the "NASD") or The Nasdaq Stock Market or any
securities exchange and (ii) from time to time such other information
concerning the Company as you may reasonably request.
(ix) If this Agreement shall terminate or shall be terminated after
execution pursuant to any provision hereof (except pursuant to a
termination under Section 11 hereof) or if this Agreement shall be
terminated by the Underwriters because of any inability, failure or refusal
on the part of the Company to perform in all material respects any
agreement herein or to comply in all material respects with any of the
terms or provisions hereof or to fulfill in all material respects any of
the conditions of this Agreement, the Company agrees to reimburse you and
the other Underwriters for all out-of-pocket expenses (including travel
expenses and reasonable fees and expenses of counsel for the Underwriters
but excluding wages and salaries paid by you) reasonably incurred by you in
connection herewith.
(x) The Company will apply the net proceeds from the sale of the
Shares to be sold by it hereunder in accordance in all material respects
with the statements under the caption "Use of Proceeds" in the Prospectus.
(xi) If Rule 430A under the Act is employed, the Company will timely
file the Prospectus pursuant to Rule 424(b) under the Act.
(xii) For a period of 180 days after the date of the Prospectus first
filed pursuant to Rule 424(b) under the Act, without your prior written
consent, the Company will not, directly or indirectly, issue, sell, offer
or contract to sell or otherwise dispose of or transfer any shares of Class
B Common Stock or securities convertible into or exchangeable or
exercisable for shares of Class B Common Stock (collectively, "Company
Securities") or any rights to purchase Company Securities, except to the
Underwriters pursuant to this Agreement and except for grants of options
pursuant to the Company's 1997 Stock Option and Incentive Plan described in
the Prospectus.
(xiii) Prior to the Closing Date or the Additional Closing Date, as
the case may be, the Company will furnish to you, as promptly as possible,
copies of any unaudited interim consolidated financial statements of the
Company and its subsidiaries for any period subsequent to the periods
covered by the financial statements appearing in the Prospectus.
(xiv) The Company will comply with all provisions of any undertakings
contained in the Registration Statement.
(xv) The Company will not at any time, directly or indirectly take
any action designed, or which might reasonably be expected to cause or
result in, or which will constitute, stabilization or manipulation of the
price of the shares of Class B Common Stock to facilitate the sale or
resale of any of the Shares.
(xvi) The Company will use its best efforts to qualify or register
its Class B Common Stock for sale in non-issuer transactions under (or
obtain exemptions from the application of) the Blue Sky laws of each state
where necessary to permit market making transactions and secondary trading,
and will comply with such Blue Sky laws and will continue such
qualifications, registrations and exemptions in effect for a period of five
years after the date hereof.
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(xvii) The Company will timely file with the National Association of
Securities Dealers Automated Quotation National Market System
("NASDAQ/NMS") all documents and notices required by the NASDAQ/NMS of
companies that have or will issue securities that are traded in the over-
the-counter market and quotations for which are reported by the NASDAQ/NMS.
(b) BWI covenants and agrees with the Underwriters that, in the event of a
Distribution by BWI (as defined in the Prospectus), BWI will structure the
conversion of options to purchase BWI common stock into options to purchase
Class B Common Stock of the Company, in accordance with "EITF 90-9", so that
such conversion will not result in a charge to earnings of the Company.
6. Representations and Warranties of the Company and BWI. The Company and
BWI hereby, severally, represent and warrant to each Underwriter on the date
hereof, and shall be deemed to represent and warrant to each Underwriter on the
Closing Date and the Additional Closing Date, that:
(a) The Company satisfies all of the requirements of the Act for use
of Form S-1 for the offering of Shares contemplated hereby. Each Prepricing
Prospectus included as part of the Registration Statement as originally
filed or as part of any amendment or supplement thereto, or filed pursuant
to Rule 424(a) under the Act, complied when so filed in all material
respects with the provisions of the Act, except that this representation
and warranty does not apply to statements in or omissions from such
Prepricing Prospectus (or any amendment or supplement thereto) made in
reliance upon and in conformity with information relating to any
Underwriter furnished to the Company in writing by or on behalf of any
Underwriter through you expressly for use therein. The Commission has not
issued any order preventing or suspending the use of any Prepricing
Prospectus.
(b) The Registration Statement (including any Rule 462 Registration
Statement), in the form in which it becomes effective and also in such form
as it may be when any post-effective amendment thereto shall become
effective, and the Prospectus, and any supplement or amendment thereto when
filed with the Commission under Rule 424(b) under the Act, will comply in
all material respects with the provisions of the Act and will not at any
such times contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading, except that this representation and
warranty does not apply to statements in or omissions from the Registration
Statement or the Prospectus (or any amendment or supplement thereto) made
in reliance upon and in conformity with information relating to any
Underwriter furnished to the Company in writing by or on behalf of any
Underwriter through you expressly for use therein.
(c) The capitalization of the Company is and will be as set forth in
the Prospectus as of the date set forth therein. BWI owns all the issued
and outstanding shares of Class A Common Stock of the Company. All the
outstanding shares of Class A Common Stock of the Company have been, and as
of the Closing Date will be, duly authorized and validly issued, are fully
paid and nonassessable and are free of any preemptive or similar rights;
except as set forth in the Prospectus, the Company is not a party to or
bound by any outstanding options, warrants, or similar rights to subscribe
for, or contractual obligations to issue, sell, transfer or acquire, any of
its capital stock or any securities convertible into or exchangeable for
any of such capital stock; the Shares to be issued and sold to the
Underwriters by the Company hereunder have been duly authorized and, when
issued and delivered to the Underwriters against payment therefor in
accordance with the terms hereof will be validly issued, fully paid and
nonassessable and free of any preemptive or similar rights; the capital
stock of the Company conforms to the description thereof in the
Registration Statement and the Prospectus (or any amendment or supplement
thereto); and the delivery of certificates for the Shares against payment
therefor pursuant to the terms of this Agreement, will pass valid title to
the Shares, free and clear of any claim, encumbrance or defect in title, to
the several Underwriters) purchasing such shares in good faith and without
notice of any lien, claim or encumbrance. The certificates for the Shares
are in valid and sufficient form.
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(d) Each of the Company and its subsidiaries and BWI is a corporation
duly organized and validly existing as a corporation in good standing under
the laws of the state of its incorporation with full corporate power and
authority to own, lease and operate its properties and to conduct its
business as presently conducted and as described in the Registration
Statement and the Prospectus (and any amendment or supplement thereto), and
is duly registered and qualified to conduct its business and is in good
standing in each jurisdiction or place where the nature of its properties
or the conduct of its business requires such registration or qualification,
except where the failure to so register or qualify does not have a material
adverse effect on the condition (financial or other), business, properties,
net worth, results of operations or prospects of the Company and its
subsidiaries (a "Material Adverse Effect").
(e) The issued shares of capital stock of each of the Company's
subsidiaries have been duly authorized and validly issued, are fully paid
and nonassessable and are owned by the Company free and clear of any
security interests, liens, encumbrances, equities or claims. The Company
does not have any subsidiaries and does not own a material interest in or
control, directly or indirectly, any other corporation, partnership, joint
venture, association, trust or other business organization, except those
subsidiaries set forth in Exhibit 21 to the Registration Statement. As used
in this Agreement, subsidiaries shall mean direct and indirect subsidiaries
of the Company.
(f) There are no legal or governmental proceedings pending or, to the
best knowledge of the Company, threatened, against the Company or its
subsidiaries or to which the Company or its subsidiaries or any of their
properties are subject, that are required to be described in the
Registration Statement or the Prospectus (or any amendment or supplement
thereto) but are not described as required. Except as described in the
Prospectus, there is no action, suit, inquiry, proceeding, or investigation
by or before any court or governmental or other regulatory or
administrative agency or commission pending or, to the best knowledge of
the Company, threatened, against or involving the Company or its
subsidiaries, which might individually or in the aggregate prevent or
adversely affect the transactions contemplated by this Agreement or result
in a Material Adverse Effect, nor is there any basis for any such action,
suit, inquiry, proceeding, or investigation. There are no agreements,
contracts, indentures, leases or other instruments that are required to be
described in the Registration Statement or the Prospectus (or any amendment
or supplement thereto) or to be filed as an exhibit to the Registration
Statement that are not described or filed as required by the Act. All such
contracts to which the Company or any of its subsidiaries is a party have
been duly authorized, executed and delivered by the Company or the
applicable subsidiary, constitute valid and binding agreements of the
Company or the applicable subsidiary and are enforceable against the
Company or the applicable subsidiary in accordance with the terms thereof,
and neither the Company or the applicable subsidiary, nor to the best of
the Company's knowledge, any other party, is in breach of or default under
any of such contracts.
(g) There are no legal or governmental proceedings pending or, to the
best knowledge of the BWI, threatened, against the Company or its
subsidiaries or BWI or to which the Company or its subsidiaries or BWI or
any of their properties are subject, that are required to be described in
the Registration Statement or the Prospectus (or any amendment or
supplement thereto) but are not described as required. Except as described
in the Prospectus, there is no action, suit, inquiry, proceeding, or
investigation by or before any court or governmental or other regulatory or
administrative agency or commission pending or, to the best knowledge of
BWI, threatened, against or involving the Company or its subsidiaries or
BWI, which might individually or in the aggregate prevent or adversely
affect the transactions contemplated by this Agreement or result in a
Material Adverse Effect, nor is there any basis for any such action, suit,
inquiry, proceeding, or investigation. To the best knowledge of BWI, there
are no agreements, contracts, indentures, leases or other instruments that
are required to be described in the Registration Statement or the
Prospectus (or any amendment or supplement thereto) or to be filed as an
exhibit to the Registration Statement that are not described or filed as
required by the Act. To the best knowledge of BWI, all such contracts to
which the Company or any of its subsidiaries is a party have been duly
authorized, executed and delivered by the Company or the applicable
subsidiary, constitute valid and
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binding agreements of the Company or the applicable subsidiary and are
enforceable against the Company or the applicable subsidiary in accordance
with the terms thereof, and neither the Company or the applicable
subsidiary, nor any other party, is in breach of or default under any of
such contracts.
(h) Neither the Company nor any of its subsidiaries is (i) in
violation of (aa) its articles of incorporation or bylaws or (bb) any law,
ordinance, administrative or governmental rule or regulation applicable to
the Company or any of its subsidiaries the violation of which would have a
Material Adverse Effect or (cc) of any decree of any court or governmental
agency or body having jurisdiction over the Company or any of its
subsidiaries; or (ii) in default in any material respect in the performance
of any obligation, agreement or condition contained in (aa) any bond,
debenture, note or any other evidence of indebtedness, or (bb) any material
agreement, indenture, lease or other material instrument to which the
Company or any of its subsidiaries is a party or by which any of their
properties may be bound; and there does not exist any state of facts which
constitutes an event of default on the part of the Company or any of its
subsidiaries as defined in such documents or which, with notice or lapse of
time or both, would constitute such an event of default.
(i) The Company's and BWI's execution and delivery of this Agreement
and the respective performance by the Company and BWI of its obligations
under this Agreement has been duly and validly authorized by the Company
and BWI, and this Agreement has been duly executed and delivered by the
Company and BWI, and this Agreement constitutes a valid and legally binding
agreement of the Company and BWI, enforceable against the Company and BWI
in accordance with its terms, except to the extent enforceability may be
limited by bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium or other similar laws relating to or affecting enforcement of
creditors' rights generally or by general equitable principles and public
policy exceptions.
(j) Neither the issuance and sale of the Shares, the execution,
delivery or performance of this Agreement by the Company and BWI nor the
consummation by the Company and BWI of the transactions contemplated hereby
or thereby (i) requires any consent, approval, authorization or other order
of or registration or filing with, any court, regulatory body,
administrative agency or other governmental body, agency or official
(except such as may be required for the registration of the Shares under
the Act, the registration of the Class B Common Stock under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and compliance with
the securities or Blue Sky laws of various jurisdictions, all of which will
be, or have been, effected in accordance with this Agreement and except for
the NASD's clearance of the underwriting terms of the offering contemplated
hereby as required under the NASD's Rules of Fair Practice), (ii) conflicts
with or will conflict with or constitutes or will constitute a breach of,
or a default under, the respective articles of incorporation or bylaws of
the Company or BWI or any agreement, indenture, lease or other instrument
to which the Company or any of its subsidiaries or BWI is a party or by
which any of its properties may be bound, (iii) violates any statute, law,
regulation, ruling, filing, judgment, injunction, order or decree
applicable to the Company or any of its subsidiaries or any of their
properties, or (iv) results in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or BWI.
(k) Except as described in the Prospectus, neither the Company or any
of its subsidiaries or BWI has outstanding and at the Closing Date (and the
Additional Closing Date, if applicable) will not have outstanding any
options to purchase, or any warrants to subscribe for, or any securities or
obligations convertible into, or any contracts or commitments to issue or
sell, any shares of Class B Common Stock or any such warrants or
convertible securities or obligations. No holder of securities of the
Company has rights to the registration of any securities of the Company as
a result of or in connection with the filing of the Registration Statement
or the consummation of the transactions contemplated hereby that have not
been satisfied or heretofore waived in writing.
8
(l) Price Waterhouse LLP, the certified public accountants who have
certified the financial statements filed as part of the Registration
Statement and the Prospectus (or any amendment or supplement thereto), are
independent public accountants as required by the Act.
(m) The financial statements, together with related schedules and
notes, included in the Registration Statement and the Prospectus (and any
amendment or supplement thereto), present fairly the financial position,
results of operations and changes in financial position of the Company on
the basis stated in the Registration Statement at the respective dates or
for the respective periods to which they apply; such statements and related
schedules and notes have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved, except as disclosed therein; and the other financial and
statistical information and data set forth in the Registration Statement
and Prospectus (and any amendment or supplement thereto) is accurately
presented and prepared on a basis consistent with such financial statements
and the books and records of the Company. No other financial statements or
schedules are required to be included in the Registration Statement.
(n) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus (or any amendment or supplement thereto), (i)
neither the Company nor any of its subsidiaries has incurred any material
liabilities or obligations, indirect, direct or contingent, or entered into
any transaction which is not in the ordinary course of business or which
could result in a material reduction in the future earnings of the Company;
(ii) neither the Company nor any of its subsidiaries has sustained any
material loss or interference with its business or properties from fire,
flood, windstorm, accident or other calamity, whether or not covered by
insurance; (iii) neither the Company nor any of its subsidiaries has paid
or declared any dividends or other distributions with respect to its
capital stock and the Company is not in default under the terms of any
class of capital stock of the Company or any outstanding debt obligations;
(iv) there has not been any change in the authorized or outstanding capital
stock of the Company or any material change in the indebtedness of the
Company (other than in the ordinary course of business); and (v) there has
not been any material adverse change, or any development involving or which
may reasonably be expected to involve a potential future material adverse
change, in the condition (financial or otherwise), business, properties,
net worth, result of operations or prospects of the Company.
(o) Each of the Company and its subsidiaries has good and marketable
title to all property (real and personal) described in the Prospectus as
being owned by it, free and clear of all liens, claims, security interests
or other encumbrances except (i) such as are described in the financial
statements included in, or elsewhere in, the Prospectus or (ii) such as are
not materially burdensome and do not interfere in any material respect with
the use of the property or the conduct of the business of the Company. All
property (real and personal) held under lease by the Company and its
subsidiaries is held by it under valid, subsisting and enforceable leases
with only such exceptions as in the aggregate are not materially burdensome
and do not interfere in any material respect with the conduct of the
business of the Company or its subsidiaries.
(p) The Company has not distributed and will not distribute any
offering material in connection with the offering and sale of the Shares
other than the Prepricing Prospectus, the Prospectus, or other offering
material, if any, as permitted by the Act.
(q) The Company has not taken, directly or indirectly, any action
which constituted, or any action designed, or which might reasonably be
expected to cause or result in or constitute, under the Act or otherwise,
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Shares or for any other purpose.
9
(r) The Company is not an "investment company," an "affiliated
person" of, or "promoter" or "principal underwriter" for an investment
company within the meaning of the Investment Company Act of 1940, as
amended.
(s) Each of the Company and its subsidiaries has all permits,
licenses, franchises, approvals, consents and authorizations of
governmental or regulatory authorities (hereinafter "permit" or "permits")
as are necessary to own its properties and to conduct its business in the
manner described in the Prospectus, subject to such qualifications as may
be set forth in the Prospectus, except where the failure to have obtained
any such permit has not and will not have a Material Adverse Effect; each
of the Company and its subsidiaries has fulfilled and performed in all
material respects all of its obligations with respect to each such permit
and no event has occurred which allows, or after notice or lapse of time
would allow, revocation or termination of any such permit or result in any
other material impairment of the rights of the holder of any such permit,
subject in each case to such qualification as may be set forth in the
Prospectus; and, except as described in the Prospectus, such permits
contain no restrictions that are materially burdensome to the Company or
any of its subsidiaries.
(t) Each of the Company and its subsidiaries has complied and will
comply with wage and hour determinations issued by the U.S. Department of
Labor under the Service Contract Act of 1965 and the Fair Labor Standards
Act in paying its employees' salaries, fringe benefits, and other
compensation for the performance of work or other duties in connection with
contracts with the U.S. government, except where the failure to comply has
not had and will not have a Material Adverse Effect. Each of the Company
has complied and will comply in all material respects with the terms of all
certifications and representations made to the U.S. government in
connection with the submission of any bid or proposal or any contract. The
Company has complied and will comply with the requirements of the American
with Disabilities Act of 1990, the Family and Medical Leave Act of 1993,
the Employee Retirement Income Security Act, the Civil Rights Act of 1964
(Title VII), as amended, the Age Discrimination in Employment Act and other
applicable federal and state employment and labor laws, except where the
failure to comply has not had and will not have a Material Adverse Effect.
(u) The Company and its subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurances that (i)
transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets;
(iii) access to assets is permitted only in accordance with management's
general or specific authorizations; and (iv) the recorded accountability
for assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(v) Neither the Company, at any time, nor any of its subsidiaries,
since being held as a subsidiary of the Company, has, directly or
indirectly, (i) made any unlawful contribution to any candidate for
political office, or failed to disclose fully any contribution in violation
of law, or (ii) made any payment to any federal, state or foreign
governmental official, or other person charged with similar public or
quasi-public duties, other than payments required or permitted by the laws
of the United States or any jurisdiction thereof or applicable foreign
jurisdictions.
(w) Each of the Company and its subsidiaries has obtained all
required permits, licenses, and other authorizations, if any, which are
required under federal, state, local and foreign statutes, ordinances and
other laws relating to pollution or protection of the environment,
including laws relating to emissions, discharges, releases, or threatened
releases of pollutants, contaminants, chemicals, or industrial, hazardous,
or toxic materials or wastes into the environment (including, without
limitation, ambient air, surface water, ground water, land surface, or
subsurface strata) or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, chemicals, or industrial, hazardous, or toxic
materials or wastes, or any regulation, rule, code, plan, order, decree,
judgment, injunction, notice, or demand letter issued, entered,
10
promulgated, or approved thereunder ("Environmental Laws"), except where
the failure to obtain any such permit, license or other authorization has
not resulted in and will not result in a Material Adverse Effect. Each of
the Company and its subsidiaries is in material compliance with all terms
and conditions of all required permits, licenses, and authorizations, and
are also in material compliance with all other limitations, restrictions,
conditions, standards, prohibitions, requirements, obligations, schedules,
and timetables contained in the Environmental Laws. There is no pending or,
to the best knowledge of the Company after due inquiry, threatened civil or
criminal litigation, notice of violation, or administrative proceeding
relating in any way to the Environmental Laws (including but not limited to
notices, demand letters, or claims under the Resource Conservation and
Recovery Act of 1976, as amended ("RCRA"), the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended ("CERCLA"),
the Emergency Planning and Community Right to Know Act of 1986, as amended
("EPCRA"), the Clean Air Act, as amended ("CAA"), or the Clean Water Act,
as amended ("CWA") and similar federal, foreign, state, or local laws)
involving the Company or any of its subsidiaries. There have not been and
there are not any past, present, or foreseeable future events, conditions,
circumstances, activities, practices, incidents, actions, or plans which
may interfere with or prevent continued compliance, or which may give rise
to any common law or legal liability, or otherwise form the basis of any
claim, action, demand, suit, proceeding, hearing, study, or investigation,
based on or related to the manufacture, processing, distribution, use,
treatment, storage, disposal, transport, or handling, or the emission,
discharge, release, or threatened release into the environment, of any
pollutant, contaminant, chemical, or industrial, hazardous, or toxic
material or waste, including, without limitation, any liability arising, or
any claim, action, demand, suit, proceeding, hearing, study, or
investigation which may be brought, under RCRA, CERCLA, EPCRA, CAA, CWA or
similar federal, foreign, state or local laws.
(x) The Company owns and has full right, title and interest in and
to, or has valid licenses to use, each material trade name, trademark or
service ▇▇▇▇ under which the Company conducts all or any material part of
its business, and the Company has created no lien or encumbrance on, or
granted any right or license with respect to, any such trade name,
trademark or service ▇▇▇▇; there is no claim pending against the Company
with respect to any trade name, trademark or service ▇▇▇▇ and the Company
has not received notice or otherwise become aware that any trade name,
trademark or service ▇▇▇▇ which it uses or has used in the conduct of its
business infringes upon or conflicts with the rights of any third party.
(y) All offers, sales, conversions and redemptions of the Company's
capital stock and other securities through the date hereof were made in
compliance with the Act and all other applicable state and federal laws or
regulations.
(z) The Shares have been duly authorized for trading on the
NASDAQ/NMS under the symbol "PHCC," subject to notice of issuance of the
Shares being sold by the Company, and upon consummation of the offering
contemplated hereby the Company will be in compliance with the designation
and maintenance criteria applicable to Nasdaq National Market issuers.
(aa) All federal, state, local and foreign tax returns required to be
filed by or on behalf of the Company and its subsidiaries (and their
predecessors) and BWI with respect to all periods ended prior to the date
of this Agreement have been filed (or are the subject of valid extension)
with the appropriate federal, state, local and foreign authorities and all
such tax returns, as filed, are accurate in all material respects. All
federal, state, local and foreign taxes (including estimated tax and sales
tax payments) required to be shown on all such tax returns or claimed to be
due from or with respect to the business of the Company and its
subsidiaries (and their predecessors) and BWI have been paid or reflected
as a liability on the financial statements of the Company and BWI for
appropriate periods, except for those taxes or claims therefor which are
being contested by the Company in good faith and for which appropriate
reserves are reflected in the Company's financial statements. All
deficiencies asserted as a result of any federal, state, local or foreign
tax audits have been paid or finally settled and no issue has
11
been raised in any such audit which, by application of the same or similar
principles, reasonably could be expected to result in a proposed deficiency
for any other period not so audited. There are no outstanding agreements or
waivers extending the statutory period of limitation applicable to any
federal, state, local or foreign tax return for any period. On the Closing
Date, and Additional Closing Date, if any, all stock transfer and other
taxes which are required to be paid in connection with the sale of the
shares to be sold by the Company to the Underwriters will have been fully
paid by the Company and all laws imposing such taxes will have been
complied with.
(aa) Except as set forth in the Prospectus, there are no transactions
with "affiliates" (as defined in Rule 405 promulgated under the Act) or any
officer, director or security holder of the Company (whether or not an
affiliate) which are required by the Act and the applicable rules and
regulations thereunder to be disclosed in the Registration Statement.
(bb) Except for the Distribution by BWI (as defined in the
Prospectus), the Company has procured the written agreement of each of the
Company's officers, directors, and BWI not to (i) directly or indirectly
sell, offer or contract to sell or otherwise dispose of or transfer any
shares of capital stock or securities of the Company convertible into or
exchangeable or exercisable for Class B Common Stock, including, but not
limited to, shares that may be received as part of the Distribution
(collectively, "Company Securities") owned or controlled by such persons
now or hereafter or any rights to purchase Company Securities for a period
of 180 days after the date of the Prospectus first filed pursuant to Rule
424(b) under the Act (the "Restriction Period"), without your prior written
consent, or (ii) exercise or seek to exercise or effectuate in any manner
any rights of any nature that such persons have or may hereafter have to
require the Company to register under the Act any such person's sale,
transfer or other disposition of any Company Securities or other securities
of the Company held by any such persons, or to otherwise participate as a
selling securityholder in any manner in any registration effected by the
Company under the Act, including the registration to which this Agreement
relates, before the expiration of the Restriction Period.
(cc) Neither the Company nor any of its subsidiaries (i) conduct
business or have affiliates which conduct business in or with Cuba, (ii)
plan to commence doing business in or with Cuba after the effective date of
the Registration Statement or (iii) are required by Florida law to report a
material change in information previously reported to the State of Florida
regarding business conducted in or with Cuba.
(dd) No officer, director, nominee for director or shareholder of the
Company has a direct or indirect affiliation or association with any member
of the National Association of Securities Dealers, Inc. (the "NASD").
7. Expenses. Whether or not the transactions contemplated hereby are
consummated or this Agreement becomes effective or is terminated, 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 and the
Prospectus and amendments and supplements thereto and the mailing and delivering
of copies thereof and of any Prepricing Prospectus to the Underwriters and
dealers; (ii) the printing and delivery (including, without limitation, postage,
air freight charges and charges for counting and packaging) of such copies of
the Registration Statement, the Prospectus, each Prepricing Prospectus, the Blue
Sky memoranda, the Master Agreement Among Underwriters, this Agreement, the
Selected Dealers Agreement and all amendments or supplements to any of them as
may be reasonably requested for use in connection with the offering and sale of
the Shares; (iii) all expenses in connection with the qualification of the
Shares for offering and sale under state securities laws or Blue Sky laws,
including the reasonable attorneys' fees and out-of-pocket expenses of the
counsel for the Underwriters in connection therewith; (iv) the filing fees
incident to securing any required review by the NASD of the terms of the sale of
the Shares and the reasonable fees and disbursements of the Underwriters'
counsel relating thereto; (v) the cost of preparing stock certificates; (vi) the
costs and charges of any transfer agent
12
or registrar; (vii) the cost of the tax stamps, if any, in connection with the
issuance and delivery of the Shares to the respective Underwriters; (viii) all
other fees, costs and expenses referred to in Item 13 of the Registration
Statement, (ix) the transportation, lodging, graphics and other expenses
incidental to the Company's preparation for and participation in the "roadshow"
for the offering contemplated hereby, and (x) all other costs and expenses
incident to the performance of the obligations of the Company hereunder which
are not otherwise specifically provided for in this Section 7. Notwithstanding
the foregoing, in the event that the proposed offering is terminated for the
reasons set forth in Section 5(i) hereof, the Company agrees to reimburse the
Underwriters as provided in Section 5(i).
8. Indemnification and Contribution. Subject to the limitations in this
paragraph below, each of the Company and BWI, jointly and severally, agrees to
indemnify and hold harmless you and each other Underwriter, the directors,
officers, employees and agents of each Underwriter, and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the Act or Section
20 of the Exchange Act from and against any and all losses, claims, damages,
liabilities and expenses, including, without limitation, reasonable costs of
investigation and attorneys' fees and expenses (collectively, "Damages") arising
out of or based upon (i) any untrue statement or alleged untrue statement of a
material fact contained in any Prepricing Prospectus or in the Registration
Statement or the Prospectus or in any amendment or supplement thereto, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except to the extent that any such Damages arise out of or are based upon an
untrue statement or omission or alleged untrue statement or omission which has
been made therein or omitted therefrom in reliance upon and in conformity with
the information furnished in writing to the Company by or on behalf of any
Underwriter through you expressly for use in connection therewith, or (ii) any
inaccuracy in or breach of the representations and warranties of the Company or
BWI contained herein or any failure of the Company or BWI to perform its
obligations hereunder or under law; provided, however, that with respect to any
untrue statement or omission made in any Prepricing Prospectus, the indemnity
agreement contained in this paragraph shall not inure to the benefit of any
Underwriter (or to the benefit of any person controlling such Underwriter) from
whom the person asserting any such losses, claims, damages or liabilities
purchased the Shares concerned if both (y) a copy of the Prospectus was not sent
or given to such person at or prior to the written confirmation of the sale of
such Shares to such person as required by the Act, and (z) the untrue statement
or omission in the Prepricing Prospectus was corrected in the Prospectus.
In addition to its other obligations under this Section 8, each of the
Company and BWI, jointly and severally, agrees that, as an interim measure
during the pendency of any claim, action, investigation, inquiry or other
proceeding arising out of or based upon any statement or omission, or any
inaccuracy in the representations and warranties of the Company herein or
failure to perform their obligations hereunder, all as set forth in this Section
8, it will reimburse each Underwriter on a quarterly basis for all reasonable
legal or other out-of-pocket expenses incurred in connection with investigating
or defending any such claim, action, investigation, inquiry or other proceeding,
notwithstanding the absence of a judicial determination as to the propriety and
enforceability of the obligation of the Company and BWI to reimburse each
Underwriter for such expenses and the possibility that such payments might later
be held to have been improper by a court of competent jurisdiction. To the
extent that any such interim reimbursement payment is so held to have been
improper, each Underwriter shall promptly return it to the person(s) from whom
it was received, together with interest compounded daily determined on the basis
of the base lending rate announced from time to time by Chase Manhattan Bank,
N.A. (the "Prime Rate"). Any such interim reimbursement payments which are not
made to the Underwriters within 30 days of a request for reimbursement shall
bear interest at the Prime Rate from the date of such request.
If any action or claim shall be brought against any Underwriter or any
person controlling any Underwriter in respect of which indemnity may be sought
jointly and severally against the Company and BWI, such Underwriter or such
controlling person shall promptly notify in writing the party(s) against whom
indemnification is being sought (the "indemnifying party" or "indemnifying
parties"), and such indemnifying party(s) shall assume the defense thereof,
including the employment of counsel reasonably acceptable to such Underwriter or
such controlling person and payment of all fees and expenses. Such Underwriter
or any such controlling person shall
13
have the right to employ separate counsel (but the Company and BWI shall not be
liable for the fees and expenses of more than one counsel) in any such action
and participate in the defense thereof, but the fees and expenses of such
counsel shall be at the expense of such Underwriter or such controlling person
unless (i) the indemnifying party(s) has (have) agreed in writing to pay such
fees and expenses, (ii) the indemnifying party(s) has (have) failed to assume
the defense and employ counsel reasonably acceptable to the Underwriter or such
controlling person or (iii) the named parties to any such action (including any
impleaded parties) include both such Underwriter or such controlling person and
the indemnifying party(s), and such Underwriter or such controlling person shall
have been advised by its counsel that one or more legal defenses may be
available to the Underwriter which may not be available to the Company or BWI,
or that representation of such indemnified party and any indemnifying party(s)
by the same counsel would be inappropriate under applicable standards of
professional conduct (whether or not such representation by the same counsel has
been proposed) due to actual or potential differing interests between them (in
which case the indemnifying party(s) shall not have the right to assume the
defense of such action on behalf of such Underwriter or such controlling person
(notwithstanding its (their) obligation to bear the fees and expenses of such
counsel)). The indemnifying party(s) shall not be liable for any settlement of
any such action effected without its (their) written consent, but if settled
with such written consent, or if there be a final judgment for the plaintiff in
any such action, the indemnifying party(s) agrees to indemnify and hold harmless
any Underwriter and any such controlling person from and against any loss,
claim, damage, liability or expense by reason of such settlement or judgment,
but in the case of a judgment only to the extent stated in the immediately
preceding paragraph.
Each Underwriter agrees, severally and not jointly, to indemnify and hold
harmless BWI and the Company, its directors, and its officers who sign the
Registration Statement, and any person who controls BWI or the Company within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, to the
same extent as the foregoing indemnity from the Company and BWI to each
Underwriter, but only with respect to information furnished in writing by or on
behalf of such Underwriter through you expressly for use in the Registration
Statement, the Prospectus or any Prepricing Prospectus, or any amendment or
supplement thereto. If any action or claim shall be brought or asserted against
BWI or the Company, any of its directors, any such officers, or any such
controlling person based on the Registration Statement, the Prospectus or any
Prepricing Prospectus, or any amendment or supplement thereto, and in respect of
which indemnity may be sought against any Underwriter pursuant to this
paragraph, such Underwriter shall have the rights and duties given to the
Company and BWI by the preceding paragraph (except that if the Company and BWI
shall have assumed the defense thereof such Underwriter shall not be required to
do so, but may employ separate counsel therein and participate in the defense
thereof, but the fees and expenses of such counsel shall be at such
Underwriter's expense), and BWI and the Company, its directors, any such
officers, and any such controlling persons shall have the rights and duties
given to the Underwriters by the immediately preceding paragraph.
If the indemnification provided for in this Section 8 is unavailable or
insufficient for any reason whatsoever to an indemnified party under the first
or fifth paragraph of this Section 8 in respect of any losses, claims, damages,
liabilities or expenses referred to therein, then an indemnifying party, in lieu
of indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
liabilities or expenses (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and BWI on the one hand and the
Underwriters on the other hand from the offering of the Shares or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and
BWI on the one hand and the Underwriters on the other hand in connection with
the statements or omissions that resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company and BWI 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; provided that, in the event that the Underwriters shall have
purchased any Additional Shares hereunder, any determination of the relative
benefits received by the Company or the Underwriters from the
14
offering of the Shares shall include the net proceeds (before deducting
expenses) received by the Company , and the underwriting discounts and
commissions received by the Underwriters, from the sale of such Additional
Shares, in each case computed on the basis of the respective amounts set forth
in the notes to the table on the cover page of the Prospectus. The relative
fault of the Company and BWI on the one hand and the Underwriters on the other
hand shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
on the one hand or by the Underwriters on the other hand and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The Company and BWI and the Underwriters agree that it would not be just
and equitable if contribution pursuant to this Section 8 was determined by a pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities and expenses referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 8, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price of the Shares underwritten by it and distributed to the public exceeds the
amount of any damages which such Underwriter has otherwise been required to pay
by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations to contribute pursuant to this Section 8 are several in proportion
to the respective numbers of Firm Shares set forth opposite their names in
Schedule I hereto (or such numbers of Firm Shares increased as set forth in
Section 10 hereof) and not joint.
Notwithstanding the second paragraph of this Section 8, any losses, claims,
damages, liabilities or expenses for which an indemnified party is entitled to
indemnification or contribution under this Section 8 shall be paid by the
indemnifying party to the indemnified party as such losses, claims, damages,
liabilities or expenses are incurred. The indemnity, contribution and
reimbursement agreements contained in this Section 8 and the representations and
warranties of the Company and BWI set forth in this Agreement shall remain
operative and in full force and effect, regardless of (i) any investigation made
by or on behalf of any Underwriter or any person controlling any Underwriter,
the Company, its directors or officers or any person controlling the Company,
(ii) acceptance of any Shares and payment therefor hereunder and (iii) any
termination of this Agreement. A successor to any Underwriter or any person
controlling any Underwriter, or to BWI, the Company, its directors or officers,
or any person controlling the Company, shall be entitled to the benefits of the
indemnity, contribution and reimbursement agreements contained in this Section
8.
It is agreed that any controversy arising out of the operation of the
interim reimbursement arrangements set forth in the second paragraph of this
Section 8, including the amounts of any requested reimbursement payments and the
method of determining such amounts, shall be settled by arbitration conducted
pursuant to the Code of Arbitration Procedure of the NASD. Any such arbitration
must be commenced by service of a written demand for arbitration or written
notice of intention to arbitrate, therein electing the arbitration tribunal. In
the event the party demanding arbitration does not make such designation of an
arbitration tribunal in such demand or notice, then the party responding to said
demand or notice is authorized to do so. Such an arbitration would be limited to
the operation of the interim reimbursement provisions contained in the second
and fifth paragraphs of this Section 8, and would not resolve the ultimate
propriety or enforceability of the obligation to reimburse expenses which is
created by the provisions of the second paragraph of this Section 8.
Notwithstanding the preceding paragraphs of this Section 8, if the
Distribution has been consummated, then the Underwriters must first proceed
against the Company for indemnification and contribution before proceeding
against BWI (it being understood, however, that (i) in such circumstances, the
Underwriters shall not be obligated to first exhaust all remedies against the
Company before proceeding against BWI; and (ii) in
15
circumstances where such Damages arise as a result of statements, facts,
representations or warranties of BWI, such Underwriters may first proceed
against BWI.)
9. Conditions of Underwriters' Obligations. The several obligations of
the Underwriters to purchase the Firm Shares hereunder are subject to the
following conditions:
(a) The Registration Statement shall have become effective not later
than 12:00 noon, New York City time, on the date hereof, or at such later
date and time as shall be consented to in writing by you, and all filings
required by Rules 424(b), 430A and 462 under the Act shall have been timely
made.
(b) You shall be reasonably satisfied that since the respective dates
as of which information is given in the Registration Statement and
Prospectus, (i) there shall not have been any change in the capital stock
of the Company or any material change in the indebtedness (other than in
the ordinary course of business) of the Company, (ii) except as set forth
or contemplated by the Registration Statement or the Prospectus, no
material oral or written agreement or other transaction shall have been
entered into by the Company which is not in the ordinary course of business
or which could reasonably be expected to result in a material reduction in
the future earnings of the Company, (iii) no loss or damage (whether or not
insured) to the property of the Company shall have been sustained which had
or could reasonably be expected to have a Material Adverse Effect, (iv) no
legal or governmental action, suit or proceeding affecting the Company or
any of its properties which is material to the Company or which affects or
could reasonably be expected to affect the transactions contemplated by
this Agreement shall have been instituted or threatened, and (v) there
shall not have been any material change in the condition (financial or
otherwise), business, management, results of operations or prospects of the
Company or its subsidiaries which makes it impractical or inadvisable in
your judgment to proceed with the public offering or purchase the Shares as
contemplated hereby.
(c) You shall have received on the Closing Date (and the Additional
Closing Date, if any) an opinion of ▇▇▇▇▇ & ▇▇▇▇▇▇▇; counsel to the
Company, to the effect that:
(i) The Company is a corporation duly incorporated and validly
existing in good standing under the laws of the State of Indiana, with
full corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the
Registration Statement and the Prospectus (and any amendment or
supplement thereto), and is duly registered or otherwise qualified to
conduct its business as a foreign corporation and is in good standing
in each jurisdiction or place where the nature of its properties or
the conduct of its business requires such registration or
qualification, except where the failure to so register or qualify does
not have a Material Adverse Effect.
(ii) Each of the subsidiaries is a corporation duly organized
and validly existing in good standing under the laws of the
jurisdiction of its organization, with full corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Registration Statement and the Prospectus
(and any amendment or supplement thereto); and is duly registered and
qualified to conduct its business and is in good standing in each
jurisdiction or place where the nature of its properties or the
conduct of its business requires such registration or qualification,
except where the failure to so register or qualify does not have a
material adverse effect on the condition (financial or other),
business, properties, net worth or results of operation of the Company
and the subsidiaries taken as a whole; and all of the outstanding
shares of capital stock of each of the subsidiaries have been duly
authorized and validly issued, and are fully paid and nonassessable,
and are owned by the Company directly, or indirectly through one of
the other subsidiaries, free and clear of any perfected security
interest, or to the best knowledge of such counsel after reasonable
inquiry, any other security interest, lien, adverse claim, equity or
other encumbrance.
16
(iii) The authorized and the outstanding capital stock of the
Company conforms in all material respects to the description thereof
contained in the Prospectus under the captions "Capitalization" and
"Description of Capital Stock." Except as set forth in the Prospectus,
to the best of such counsel's knowledge, the Company is not a party to
or bound by any outstanding options, warrants or similar rights to
subscribe for, or contractual obligations to issue, sell, transfer or
acquire, any of its capital stock or any securities convertible into
or exchangeable for any of such capital stock.
(iv) All shares of capital stock of the Company outstanding
prior to the issuance of the Shares to be issued and sold by the
Company hereunder, have been duly authorized and validly issued, are
fully paid and nonassessable and are free of any preemptive or, to the
best knowledge of such counsel, similar rights that entitle or will
entitle any person to acquire any Shares upon the issuance thereof by
the Company, and no such rights will exist as of the Closing Date.
(v) All offers and sales of the Company's securities have been
made in compliance in all material respects with the registration
requirements of the Act and other applicable state securities laws or
regulations or applicable exemptions therefrom.
(vi) The Shares to be issued and sold to the Underwriters by
the Company hereunder have been duly authorized and, when issued and
delivered to the Underwriters against payment therefor in accordance
with the terms hereof, (A) such Shares will be validly issued, fully
paid and nonassessable and free of any preemptive or, to the best
knowledge of such counsel, similar rights that entitle or will entitle
any person to acquire any Shares upon the issuance thereof by the
Company, and (B) good, valid and marketable title to such Shares
issued hereunder, free and clear of any claim, encumbrance or defect
in title of any nature (other than any arising by or through the
Underwriters), will pass to each Underwriter that has purchased any
portion of such Shares in good faith and without knowledge of any such
claim, encumbrance or defect.
(vii) The form of certificates for the Shares conforms in all
material respects to the requirements of the applicable corporate laws
of the State of Indiana.
(viii) The Registration Statement has become effective under the
Act and, to the best knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose are pending before or
contemplated by the Commission.
(ix) The Company has all requisite corporate power and
authority to enter into this Agreement and to issue, sell and deliver
the Shares to be sold by it to the Underwriters as provided herein,
and this Agreement has been duly authorized, executed and delivered by
the Company and is a valid, legal and binding agreement of the Company
enforceable against the Company in accordance with its terms, except
to the extent enforceability may be limited by bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium or other similar laws
relating to or affecting enforcement of creditors' rights generally or
by general equitable principles, and except to the extent
enforceability of the provisions relating to indemnity and
contribution for liabilities under the Act may be limited by or under
the Act, or by public policy.
(x) Neither the Company nor any of the subsidiaries is in
violation of its certificate of incorporation or bylaws, and, to the
best knowledge of such counsel, the Company is not in default in the
performance of any obligation, agreement or condition contained in any
bond, indenture, note or other evidence of indebtedness or any other
agreement or obligation of the
17
Company, where the default would have, individually or in the
aggregate, a Material Adverse Effect.
(xi) Neither the offer, sale or delivery of the Shares, the
execution, delivery or performance of this Agreement, compliance by
the Company with all provisions hereof nor consummation by the Company
of the transactions contemplated hereby (A) conflicts or will conflict
with or constitutes or will constitute a breach of, or a default
under, the certificate of incorporation or bylaws of the Company or
any material agreement, indenture, lease or other instrument known to
such counsel to which the Company is a party or by which any of its
properties is bound, (B) creates or will result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company, or (C) violates or will result in any violation
of any existing law, statute, regulation, ruling (assuming compliance
with all applicable state securities and Blue Sky laws), judgment,
injunction, order or decree which is known to such counsel and
applicable to the Company or any of its properties.
(xii) No consent, approval, authorization or other order of, or
registration or filing with, any court, regulatory body,
administrative agency or other governmental body, agency or official
is required on the part of the Company (except such as have been
obtained under the Act or such as may be required under state
securities or Blue Sky laws governing the purchase and distribution of
the Shares) for the valid issuance and sale of the Shares to the
Underwriters under this Agreement.
(xiii) The Registration Statement and the Prospectus and any
supplements or amendments thereto (except for the financial statements
and the notes thereto and the schedules and other financial and
statistical data included therein, as to which such counsel need not
express any opinion) comply as to form in all material respects with
the requirements of the Act. Without limiting the generality of the
foregoing, any Rule 434 Prospectus conforms in all material respects
with the requirements of Rule 434 under the Act.
(xiv) To the best knowledge of such counsel, (A) there are no
legal or governmental proceedings pending or threatened against the
Company or to which the Company or any of its properties is subject,
that are required to be described in the Registration Statement or
Prospectus (or any amendment or supplement thereto) that are not
described as required therein, and (B) there are no agreements,
contracts, indentures, leases or other instruments that are required
to be described in the Registration Statement or the Prospectus or to
be filed as an exhibit to the Registration Statement that are not
described or filed as required, as the case may be.
(xv) To the best knowledge of such counsel, the Company is not
in violation of any law, ordinance, administrative or governmental
rule or regulation applicable to the Company or of any decree of any
court or governmental agency or body having jurisdiction over the
Company except where such violation does not and will not have a
Material Adverse Effect.
(xvi) The properties described in the Prospectus as held under
lease by the Company are held under duly executed leases.
(xvii) Such counsel has reviewed all agreements, contracts,
indentures, leases or other documents or instruments described or
referred to in the Registration Statement and the Prospectus (other
than routine contracts entered into by the Company for the purchase of
materials or the sale of products entered into in the normal course of
business, although such counsel has reviewed the forms of such routine
contracts), and such agreements, contracts (and forms of contracts),
indentures, leases or other documents or instruments are fairly
summarized or disclosed in all material respects therein, and filed as
exhibits thereto as required, and such
18
counsel does not know of any agreements, contracts, indentures, leases
or other documents or instruments required to be so summarized or
disclosed or filed which have not been so summarized or disclosed or
filed.
(xviii) The descriptions in the Prospectus of statutes,
regulations or legal or governmental proceedings, insofar as they
purport to summarize certain of the provisions thereof, are accurate
and fairly present the information required to be presented by the Act
and the rules and regulations thereunder.
(xix) The Company is not an "investment company" or an
"affiliated person" of, or "promoter" or "principal underwriter" for,
an "investment company," as such terms are defined in the Investment
Company Act of 1940, as amended.
In rendering such opinion, counsel may rely, to the extent they deem
such reliance proper, upon an opinion or opinions, each dated the Closing
Date, of other counsel as to matters governed by the laws of jurisdictions
other than the United States or the State of Indiana provided that (1) each
such local counsel is acceptable to you and your counsel, (2) counsel shall
state in their opinion that they believe that they and you are justified in
relying thereon, and (3) such reliance is expressly authorized by each
opinion so relied upon and a copy of each such opinion is delivered to you
and is in form and substance satisfactory to you. In rendering such
opinion, counsel may rely, to the extent they deem such reliance proper, as
to matters of fact upon certificates of officers of the Company and of
government officials, provided that counsel shall state their belief that
they and you are justified in relying thereon. Copies of all such
certificates shall be furnished to you and your counsel on the Closing
Date.
In rendering such opinion, in each case where such opinion is
qualified by "the best knowledge of such counsel" or "known to such
counsel", such counsel may rely as to matters of fact upon certificates of
executive and other officers and employees of the Company as you and such
counsel shall deem are appropriate and such other procedures as you and
such counsel shall mutually agree; provided, however, in each such case,
such counsel shall state that it has no knowledge contrary to the
information contained in such certificates or developed by such procedures
and knows of no reason why you should not reasonably rely upon the
information contained in such certificates or developed by such procedures.
Such counsel may state in such opinion that its knowledge is limited to the
knowledge of its attorneys and other representatives and employees that
have given attention to the Company's matters in connection with the
transactions contemplated by this Agreement.
In addition to the opinion set forth above, such counsel shall state that
during the course of their participation in the preparation of the Registration
Statement and the Prospectus and the amendments thereto, nothing has come to the
attention of such counsel which has caused them to believe or given them reason
to believe that the Registration Statement or the Prospectus or any amendment
thereto (except for the financial statements and other financial and statistical
information contained therein or omitted therefrom as to which no opinion need
be expressed), at the date thereof, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or that the Registration
Statement or the Prospectus as of the date of the opinion (except as aforesaid),
contains an untrue statement of a material fact or omits to state a material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading.
(d) You shall have received on the Closing Date (and the Additional
Closing Date, if any) an opinion of ▇▇▇▇▇ & ▇▇▇▇▇▇▇, as special FDA counsel
to the Company, substantially to the effect that the FDA would not require
the Company to file a New Drug Application with respect to its Priority
Pharmacy Division.
19
(e) You shall have received on the Closing Date (and the Additional
Closing, if any) an opinion of the General Counsel to BWI, to the effect
that the Company has such permits, licenses, franchises, approvals,
consents and authorizations of governmental or regulatory authorities
("Permits"), as are necessary for the Company to own its properties and to
conduct its business in the manner described in the Prospectus, except
where the failure to have such Permits would not individually or in the
aggregate have a Material Adverse Effect; the Company and its subsidiaries
have performed all of their material obligations with respect to such
Permits and no event has occurred which allows, or after notice or lapse of
time would allow, revocation or termination thereof or result in any other
material impairment of the rights of the holder of any such Permit; and
such Permits contain no restrictions that are materially burdensome to the
Company.
(f) You shall have received on the Closing Date an opinion of
▇▇▇▇▇▇▇▇▇ Traurig ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇, P.A., as counsel for the
Underwriters, dated the Closing Date with respect to the issuance and sale
of the Shares, the Registration Statement and other related matters as you
may reasonably request, and the Company and its counsel shall have
furnished to your counsel such documents as they may reasonably request for
the purpose of enabling them to pass upon such matters.
(g) You shall have received letters addressed to you and dated the
date hereof and the Closing Date (and the Additional Closing Date, if any)
from (i) the firm of Price Waterhouse LLP, independent certified public
accountants, and (ii) the Chief Financial Officer of the Company,
substantially in the forms heretofore approved by you.
(h) (i) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall be pending or, to the knowledge of the Company, shall be
threatened or contemplated by the Commission at or prior to the Closing
Date; (ii) no order suspending the effectiveness of the Registration
Statement or the qualification or registration of the Shares under the
securities or Blue Sky laws of any jurisdiction shall be in effect and no
proceeding for such purpose shall be pending or, to the knowledge of the
Company, threatened or contemplated by the Commission or the authorities of
any jurisdiction; (iii) any request for additional information on the part
of the staff of the Commission or any such authorities shall have been
complied with to the satisfaction of the staff of the Commission or such
authorities; (iv) after the date hereof no amendment or supplement to the
Registration Statement or the Prospectus shall have been filed unless a
copy thereof was first submitted to you and you did not object thereto in
good faith; and (v) all of the representations and warranties of the
Company contained in this Agreement shall be true and correct in all
respects on and as of the date hereof and on and as of the Closing Date as
if made on and as of the Closing Date, and you shall have received a
certificate, dated the Closing Date and signed by the chief executive
officer and the chief financial officer of the Company (or such other
officers as are acceptable to you) to the effect set forth in this Section
9(f) and in Sections 9(b) and 9(g) hereof.
(i) The Company shall not have failed in any material respect at or
prior to the Closing Date to have performed or complied with any of its
agreements herein contained and required to be performed or complied with
by it hereunder at or prior to the Closing Date.
(j) The Company shall have furnished or caused to have been furnished
to you such further certificates and documents as you shall have reasonably
requested.
(k) At or prior to the Closing Date, you shall have received the
written commitment of each of the Company's officers and directors, and
BWI, not to (i) except for the Distribution by BWI, directly or indirectly
sell, offer or contract to sell, or otherwise dispose of or transfer any
shares of capital stock or securities of the Company convertible into or
exchangeable or exercisable for Class B Common Stock (collectively,
"Company Securities") owned or controlled by such persons now or hereafter
or any rights to purchase Company Securities, for a period of 180 days
after the date of the Prospectus first filed pursuant
20
to Rule 424(b) under the Act (the "Restriction Period"), without your prior
written consent, or (ii) exercise or seek to exercise or effectuate in any
manner any rights of any nature that such persons have or may hereafter
have to require the Company to register under the Act any such person's
sale, transfer or other disposition of any Company Securities or other
securities of the Company held by any such persons, or to otherwise
participate as a selling securityholder in any manner in any registration
effected by the Company under the Act, including the registration to which
this Agreement relates, before the expiration of the Restriction Period.
(l) At or prior to the effective date of the Registration Statement,
you shall have received a letter from the Corporate Financing Department of
the NASD confirming that such Department has determined to raise no
objections with respect to the fairness or reasonableness of the
underwriting terms and arrangements of the offering contemplated hereby.
All such opinions, certificates, letters and other documents will be in
compliance with the provisions hereof only if they are reasonably satisfactory
in form and substance to you and your counsel.
The several obligations of the Underwriters to purchase Additional Shares
hereunder are subject to the satisfaction on and as of the Additional Closing
Date of the conditions set forth in this Section 9, except that, if the
Additional Closing Date is other than the Closing Date, the certificates,
opinions and letters referred to in paragraphs (c) through (e) shall be dated as
of the Additional Closing Date and the opinions called for by paragraphs (c) and
(d) shall be revised to reflect the sale of Additional Shares.
If any of the conditions hereinabove provided for in this Section 9 shall
not have been satisfied when and as required by this Agreement, this Agreement
may be terminated by you by notifying the Company of such termination in writing
or by telegram at or prior to such Closing Date, but you shall be entitled to
waive any of such conditions.
10. Effective Date of Agreement. This Agreement shall become effective
upon the later of (a) the execution and delivery hereof by the parties hereto,
and (b) release of notification of the effectiveness of the Registration
Statement by the Commission; provided, however, that the provisions of Sections
7, and 8 shall at all times be effective.
If any one or more of the Underwriters shall fail or refuse to purchase
Firm Shares which it or they have agreed to purchase hereunder, and the
aggregate number of Firm Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase is not more than one-tenth
of the aggregate number of the Firm Shares, each non-defaulting Underwriter
shall be obligated, severally, in the proportion which the number of Firm Shares
set forth opposite its name in Schedule I hereto bears to the aggregate number
of Firm Shares set forth opposite the names of all non-defaulting Underwriters
or in such other proportion as you may specify in the Agreement Among
Underwriters, to purchase the Firm Shares which such defaulting Underwriter or
Underwriters agreed, but failed or refused to purchase. If any Underwriter or
Underwriters shall fail or refuse to purchase Firm Shares and the aggregate
number of Firm Shares with respect to which such default occurs is more than
one-tenth of the aggregate number of Firm Shares and arrangements satisfactory
to you and the Company for the purchase of such Firm Shares are not made within
48 hours after such default, this Agreement will terminate without liability on
the part of any non-defaulting Underwriter or the Company. In any such case
which does not result in termination of this Agreement, either you or the
Company shall have the right to postpone the Closing Date, but in no event for
longer than seven (7) days, in order that the required changes, if any, in the
Registration Statement and the Prospectus or any other documents or arrangements
may be effected. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any such default of any such
Underwriter under this Agreement.
11. Termination of Agreement. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of any
Underwriter to the Company by notice to the Company, if prior to
21
the Closing Date or the Additional Closing Date (if different from the Closing
Date and then only as to the Additional Shares), as the case may be, in your
sole judgment, (i) trading in the Company's Class B Common Stock shall have been
suspended by the Commission or the NASDAQ/NMS, (ii) trading in securities
generally on the New York Stock Exchange, American Stock Exchange or NASDAQ/NMS
shall have been suspended or materially limited, or minimum or maximum prices
shall have been generally established on such exchange, or additional material
governmental restrictions, not in force on the date of this Agreement, shall
have been imposed upon trading in securities generally by any such exchange or
by order of the Commission or any court or other governmental authority, (iii) a
general moratorium on commercial banking activities shall have been declared by
either federal or New York State authorities or (iv) 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 or
other material event the effect of which on the financial markets of the United
States is such as to make it, in your judgment, impracticable or inadvisable to
market the Shares or to enforce contracts for the sale of the Shares. Notice of
such cancellation shall be promptly given to the Company and its counsel by
telegraph, telecopy or telephone and shall be subsequently confirmed by letter.
12. Information Furnished by the Underwriters. The Company acknowledges
that (i) the paragraph immediately following footnote (3) on the cover page of
the Prospectus, and (ii) the third and seventh paragraphs under the caption
"Underwriting" in any Prepricing Prospectus and in the Prospectus, constitute
the only information furnished by or on behalf of the Underwriters through you
or on your behalf as such information is referred to in Sections 6(a), 6(b) and
9 hereof.
13. Miscellaneous. Except as otherwise provided in Sections 5 and 11
hereof, notice given pursuant to any of the provisions of this Agreement shall
be in writing and shall be delivered (i) if to the Company to the office of the
Company at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇; Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (with copy to ▇▇▇▇▇ & ▇▇▇▇▇▇▇; Attention:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.), if to BWI, to the office of BWI at ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇. Attention: ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇, or (iii) if to you, as Representative of the Underwriters, to ▇▇▇▇▇▇▇
▇▇▇▇▇ & Associates, Inc., ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: ▇▇▇▇▇ ▇. Ascari, Managing Director (with copy to ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇, P.A., ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇; Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.).
This Agreement has been and is made solely for the benefit of the several
Underwriters, the Company, and its respective directors and officers and BWI.
14. Applicable Law; Counterparts. This Agreement shall be governed by and
construed in accordance with the laws of the State of Florida without reference
to choice of law principles thereunder.
This Agreement may be signed in various counterparts which together shall
constitute one and the same instrument.
This Agreement shall be effective when, but only when, at least one
counterpart hereof shall have been executed on behalf of each party hereto.
The Company, BWI and the Underwriters each hereby irrevocably waive any
right they may have to a trial by jury in respect to any claim based upon or
arising out of this Agreement or the transactions contemplated hereby.
22
Please confirm that the foregoing correctly sets forth the agreement among
the Company, the Selling Stockholders and the several Underwriters.
Very truly yours,
PRIORITY HEALTHCARE CORPORATION
By:
-------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
President and Chief Executive Officer
BINDLEY WESTERN INDUSTRIES, INC.
By:
-------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
President and Chief Executive Officer
CONFIRMED as of the date first above mentioned,
on behalf of the Representatives and the other
several Underwriters named in Schedule I hereto.
By:
-------------------------------------
23
SCHEDULE I
Number of
Name Firm Shares
--------------------------------------------- -----------
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Associates, Inc. ..............................
Wheat, First Securities, Inc. .................................
_______________................................................
_______________................................................
_______________................................................
_______________................................................
TOTAL..........................................................
