Exhibit 3.1
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PLACEMENT AGREEMENT
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April ___, 1998
PACIFIC GROWTH EQUITIES 353 Sacramento Street, 16th Floor San Francisco,
California 94111
Ladies and Gentlemen:
SECTION 1. Introductory. Sheridan Health Care, Inc., a
Delaware corporation (the "Company"), hereby engages Pacific Growth Equities
(the "Agent") upon the terms and conditions set forth herein, as the Company's
agent in connection with the proposed offering to the entities identified on
Exhibit A of the number of shares set forth opposite each such entity's name on
Exhibit A (the "Placement Shares") of the Company's authorized but unissued
common stock, $.01 par value ("Common Stock").
SECTION 2. Representations and Warranties of the Company. The
Company hereby represents and warrants to the Agent that:
(a) A registration statement on Form S-3 (File No.
[file no.]) as to [number of shares] shares of Common Stock of the Company has
been prepared by the Company in conformity with the requirements of the
Securities Act of 1933, as amended (the "Act"), and the rules and regulations
(the "Rules and Regulations") of the Securities and Exchange Commission (the
"Commission") thereunder, has been filed with the Commission, and has been
declared effective by the Commission. The [number of shares] shares of Common
Stock to which this filing relates are sometimes referred to herein as the
"Shares." The Company meets the necessary requirements for filing on Form S-3.
The Company [has prepared and has filed an amendment to the registration
statement prior to the effective date of the registration statement, and] may
prepare and file amendments to the registration statement after the effective
date of the registration statement, any and all such amendments [have been or]
will be similarly prepared. There have been delivered to you two signed copies
of the registration statement and any amendments thereto, together with two
copies of each exhibit filed therewith. The Company will next file with the
Commission a final prospectus in accordance with Rules 430A and/or 424(b) of the
Rules and Regulations. As filed, the final prospectus, and any post-effective
amendments to the registration statement shall include all Rule 430A Information
(as hereinafter defined) and, except to the extent that you shall agree in
writing to a modification, shall be in all substantive respects in the form
furnished to you prior to the date and time that this Agreement was executed and
delivered by the parties hereto or, to the extent not completed at such date and
time, shall contain only such specific additional information and other changes
(beyond those contained in the latest Preliminary Prospectus (as hereinafter
defined)) as the Company shall have previously advised you in writing would be
included or made therein.
The term "Registration Statement" as used in this Agreement
shall mean, collectively, the registration statement referred to in the
preceding paragraph at the time such registration statement becomes effective
and, in the event any post-effective amendments thereto become effective prior
to the Closing Date (as hereinafter defined), shall also mean the registration
statement as so amended; provided, however, that such term shall also include
all Rule 430A Information deemed to be included in such registration statements
at the time such registration statement becomes effective as provided by Rule
430A of the Rules and Regulations. The term "Preliminary Prospectus" shall mean
any preliminary prospectus referred to in the preceding paragraph and any
preliminary prospectus included in the Registration Statement at the time it
becomes effective that omits Rule 430A Information. The term "Prospectus" as
used in this Agreement shall mean either (i) the prospectus relating to the
Shares in the form in which it is first filed with the Commission pursuant to
Rule 424(b) of the Rules and Regulations or, (ii) if no filing pursuant to Rule
424(b) of the Rules and Regulations is required, the form of final prospectus
included in the Registration Statement at the time such registration statement
becomes effective. The term "Rule 430A Information" means information with
respect to the Shares and the offering thereof permitted to be omitted from the
Registration Statement when it becomes effective pursuant to Rule 430A of the
Rules and Regulations.
(b) The Commission has not issued any order
preventing or suspending the use of any Preliminary Prospectus, and each
Preliminary Prospectus has conformed in all material respects to the
requirements of the Act and the Rules and Regulations and, as of its date, has
not included any untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and at the time the
Registration Statement became effective, and at all times subsequent thereto up
to and including the Closing Date, the Registration Statement and the
Prospectus, and any amendments or supplements thereto, contained or incorporated
by reference, and will contain or incorporate by reference, all material
statements and information required to be included therein by the Act and the
Rules and Regulations and conformed and will conform in all material respects to
the requirements of the Act and the Rules and Regulations, and neither the
Registration Statement nor the Prospectus, nor any amendment or supplement
thereto, included or incorporated by reference, or will include or incorporate
by reference, any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, no representation or warranty
contained in this subsection 2(b) shall be applicable to information contained
in or omitted from any Preliminary Prospectus, the Registration Statement, the
Prospectus or any amendment or supplement thereto in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
the Agent, specifically for use in the preparation thereof.
(c) The Company does not own or control, directly or
indirectly, any corporation, association or other entity other than the
subsidiaries of the Company described in the Registration Statement or the
materials incorporated by reference therein or set forth in Schedule 2(c)
hereto. The Company has been duly incorporated and is validly existing under the
laws of the State of Delaware. The Company has full power and authority
(corporate and other) to own and lease its properties and conduct its business
as described in the Prospectus or the materials incorporated by reference
therein; except as disclosed in the Prospectus or the materials incorporated by
reference therein, the Company now holds, and at the Closing Date will hold, all
authorizations, licenses, permits, and certificates from Federal, State, and
other regulatory authorities (collectively, "Permits") that are necessary for
the conduct of its business (as such business is currently conducted), except
where the failure to hold such Permit would not have a material adverse effect
on the Company; the Company is duly qualified to do business and in good
standing as a foreign corporation in each jurisdiction in which the ownership or
leasing of properties or the conduct of its business requires such
qualification, except for jurisdictions in which the failure to so qualify would
not have a material adverse effect upon the Company; and no proceeding has been
instituted in any such jurisdiction, revoking, limiting or curtailing, or
seeking to revoke, limit or curtail, the Company's qualification or power and
authority to do business within such jurisdiction.
(d) The Company has authorized and issued share
capital as set forth in the Prospectus; the issued and outstanding shares of
Common Stock have been duly authorized and validly issued, are fully paid, have
been issued in compliance with all federal and state securities laws, were not
issued in violation of or subject to any preemptive rights or other rights to
subscribe for or purchase securities, and conform to the description thereof
contained in the Prospectus, the materials incorporated by reference therein
[and Schedule 2(d) attached hereto]. Except as disclosed in the Prospectus or
the materials incorporated by reference therein and the financial statements of
the Company, and related notes thereto included in or incorporated into the
Prospectus, the Company does not have outstanding any options to purchase,
preemptive rights or other rights to subscribe for or to purchase, or any
obligations convertible into, any shares of its capital stock, or any contracts
or commitments to issue or sell shares of its capital stock or any such options,
rights or convertible securities or obligations. The description of the
Company's stock option, stock bonus and other stock schemes, plans or
arrangements, and the options or other rights granted and exercised thereunder,
incorporated by reference into the Prospectus accurately and fairly presents the
information required to be shown with respect to such schemes, plans,
arrangements, options and rights. The Common Stock is quoted on the Nasdaq
National Market.
(e) The Placement Shares to be sold by the Company
have been duly authorized and, when issued, delivered and paid for in the manner
set forth in the Agreements with the purchasers thereof, will be validly issued
and fully paid, and will conform in all material respects to the description
thereof contained in the Prospectus or incorporated by reference therein. No
preemptive rights or other subscription or purchase rights exist with respect to
the issuance and sale of the Placement Shares by the Company. No stockholder of
the Company has any right that has not been waived to require the Company to
register the sale of any shares owned by such stockholder under the Act in
connection with the offering of the Placement Shares. No further approval or
authority of the stockholders or the Board of Directors of the Company will be
required for the issuance and sale of the Placement Shares to be sold by the
Company as contemplated herein.
(f) The Company has full legal right, power and
authority to enter into this Agreement and perform the transactions contemplated
hereby. This Agreement has been duly authorized, executed and delivered by the
Company. The making and performance of this Agreement by the Company and the
consummation of the transactions herein contemplated will not (i) violate any
provisions of the Certificate of Incorporation or other organizational documents
of the Company, and (ii) except for any conflicts, defaults, breaches or
violations that would not have a material adverse affect on the Company, will
not conflict with, result in the breach or violation of, or constitute, either
by themselves or upon notice or the passage of time or both, a default under (A)
any agreement, mortgage, deed of trust, lease, franchise, license, indenture,
permit or other instrument to which the Company is a party or by which the
Company or any of its properties may be bound or affected, or (B) any statute or
any authorization, judgment, decree, order, rule or regulation of any court,
regulatory body, administrative agency or other governmental body applicable to
the Company or any of its properties. No consent, approval, authorization or
other order of any court, regulatory body, administrative agency or other
governmental body is required for the execution and delivery of this Agreement
or the consummation of the transactions contemplated by this Agreement, except
for compliance with the Act, the Blue Sky laws applicable to the public offering
of the Placement Shares by the Company and the Agent on behalf of the Company
and the clearance of such offering with the National Association of Securities
Dealers, Inc. (the "NASD").
(g) Arthur Andersen, which has expressed its opinion
with respect to the financial statements and schedules incorporated by reference
into the Registration Statement and Prospectus, are an independent accounting
firm as required by the Act and the Rules and Regulations.
(h) The financial statements and schedules of the
Company and the related notes thereto incorporated by reference into the
Registration Statement and the Prospectus present fairly the financial position
of the Company as of the respective dates of such financial statements and
schedules, and the results of operations and changes in financial position of
the Company for the respective periods covered thereby. Such statements,
schedules and related notes have been prepared in accordance with generally
accepted accounting principles applied on a consistent basis as certified by the
independent accountants named in subsection 2(g). No other financial statements
or schedules are required to be included in the Registration Statement or
incorporated by reference therein.
(i) Except as disclosed in the Prospectus or the
materials incorporated by reference therein, and except as to defaults that
individually or in the aggregate would not have a material, adverse affect on
the Company, the Company is not in violation of, or in default under, any
provision of its Certificate of Incorporation or other organizational documents,
nor is it in breach of, or in default under, any provision of any agreement,
judgment, decree, order, mortgage, deed of trust, lease, franchise, license,
indenture, permit or other instrument to which it is a party or by which it or
any of its properties are bound; and there does not exist any state of facts
that constitutes an event of default on the part of the Company as defined in
such documents or that, with notice or lapse of time or both, would constitute
such an event of default.
(j) There are no contracts or other documents
required to be described in or incorporated by reference into the Registration
Statement or to be filed as exhibits to the Registration Statement by the Act or
the Rules and Regulations that have not been described, incorporated by
reference or filed as required. The descriptions of the contracts contained in
the Prospectus or incorporated by reference therein are accurate and complete in
all material respects; all such contacts, other than contracts the termination
of which would not have a material adverse affect on the Company, are in full
force and effect on the date hereof.
(k) Except as disclosed in the Prospectus or the
materials incorporated by reference therein, there are no legal or governmental
actions, suits or proceedings pending or, to the best of the Company's
knowledge, threatened to which the Company is or may be a party or of which
property owned or leased by the Company is or may be the subject, or related to
environmental or discrimination matters, which might, individually or in the
aggregate, prevent or materially adversely affect the transactions contemplated
by this Agreement or result in a material adverse change in the condition
(financial or otherwise), properties, business, results of operations or, to the
best of the Company's knowledge, prospects of the Company; and no labor
disturbance by the employees of the Company exists or is imminent that might be
expected to have a material adverse affect on such condition, properties,
business, results of operations or, to the best of Company's knowledge,
prospects. The Company is not a party or subject to the provisions of any
material injunction, judgment, decree or order of any court, regulatory body,
administrative agency or other governmental body.
(l) Except as disclosed in the Prospectus, the
Company has good and marketable title to all the properties and assets reflected
as owned in the Prospectus, including the financial statements thereto, and any
such properties or assets are not subject to any liens, mortgages, pledges,
charges or encumbrances of any kind except (i) those, if any, reflected in the
Prospectus, or (ii) those which are not material in amount and do not adversely
affect the use made and proposed to be made of such property or assets by the
Company. The Company holds its leased properties under valid and binding leases,
with such exceptions as are not materially significant in relation to the
business of the Company. Except as disclosed in the Prospectus, the Company owns
or leases all such properties as are necessary to its operations as now
conducted.
(m) Since the respective dates as of which
information is given in the Registration Statement and Prospectus, and except as
described in or contemplated by the Prospectus or the materials incorporated by
reference therein: (i) the Company has not incurred any material liability or
obligation, indirect, direct or contingent, or entered into any material verbal
or written agreement or other transaction that is not in the ordinary course of
business or that, in the Company's reasonable judgment, is likely to result in a
material reduction in the future earnings of the Company; (ii) the Company has
not 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) the Company has not paid or declared any dividends or other
distributions with respect to its issued share capital and the Company is not in
default in the payment of principal or interest on any outstanding debt
obligations; (iv) there has not been any material change in the share capital
(other than upon the sale of the Placement Shares hereunder) or indebtedness of
the Company (other than in the ordinary course of business); and (v) there has
not been any material adverse change in the condition (financial or otherwise),
business, properties, results of operations or, to the best of the Company's
knowledge, prospects of the Company.
(n) Except as disclosed in or specifically
contemplated by the Prospectus or the materials incorporated by reference
therein, (i) to the best of the Company's knowledge, the Company has sufficient
trademarks, trade names, patent rights, copyrights, licenses and other similar
rights and proprietary knowledge (collectively, the "Intangibles"), approvals
and governmental authorizations to conduct its businesses as now conducted; (ii)
the Company has not received any written notice of infringement by it of
Intangibles or trade secrets of others; and (iii) to the best of the Company's
knowledge, there is no claim being made against the Company regarding the
infringement of Intangibles or trade secrets that could have a material adverse
affect on the condition (financial or otherwise), business, results of
operations or, to the best of the Company's knowledge, prospects of the Company.
(o) Except as disclosed in the Prospectus or the
materials incorporated by reference therein, the Company has not been advised,
and has no reason to believe, that it is not conducting business in compliance
with all applicable laws, rules and regulations of the jurisdictions in which it
conducts business, including, without limitation, all applicable local, state
and federal environmental laws and regulations; except where failure to be so in
compliance would not materially adversely affect the condition (financial or
otherwise), business, results of operations or, to the best of the Company's
knowledge, prospects of the Company.
(p) The Company has filed all necessary federal,
state and other income and franchise tax returns and has paid all taxes shown as
due on all such returns; and the Company has no knowledge of any tax deficiency
that has been or might be asserted or threatened against the Company that could
materially and adversely affect the business, operations or properties of the
Company.
(q) The Company is not an "investment company" within
the meaning of the Investment Company Act of 1940, as amended.
(r) The Company has not distributed and will not
distribute prior to the Closing Date any offering material in connection with
the offering and sale of the Placement Shares other than the Preliminary
Prospectus, the Prospectus, the Registration Statement and other materials the
distribution of which is permitted under the Act.
(s) Except as described in the Prospectus or the
materials incorporated by reference therein, the Company maintains insurance of
the types and in amounts generally deemed adequate for its business, including,
but not limited to, insurance covering real and personal property owned or
leased by the Company against theft, damage, destruction, acts of vandalism and
all other risks customarily insured against, all of which insurance is in full
force and effect.
(t) The Company has not at any time during the last
five years (i) made any unlawful contribution to any candidate for public
office, or failed to disclose fully any contribution in violation of law, or
(ii) made any payment to any governmental officer or 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.
(u) The Company has not taken and will not take,
directly or indirectly, any action designed or that might be reasonably expected
to cause or result in stabilization or manipulation of the price of the Common
Stock to facilitate the sale or resale of the Placement Shares.
(v) No transfer taxes are required to be paid in
connection with the sale and delivery of the Placement Shares hereunder.
(w) The Placement Shares have been duly authorized
for quotation on the Nasdaq National Market.
SECTION 3. Representations and Warranties of the Agent. The
Agent represents and warrants to the Company that (A) it is duly registered as a
broker/dealer pursuant to the Securities Exchange Act of 1934 and is a member in
good standing of the NASD, and (B) it has not distributed and will not
distribute prior to the Closing Date any offering material in connection with
the offering and sale of the Placement Shares, or any other shares, other than
the Preliminary Prospectus, the Registration Statement and other materials the
distribution of which is permitted under the Act. The Company acknowledges and
agrees that no information set forth in the Prospectus was furnished to the
Company by and on behalf of the Agent for use in connection with the preparation
of the Registration Statement and the Prospectus.
SECTION 4. Purchase, Sale and Delivery of the Placement
Shares. The purchase price per share to be paid by the several purchasers to the
Company shall be determined by separate agreement among the Company and the
purchasers. The Company agrees to pay to the Agent at the Closing a commission
equal to $[amount of commission].
Delivery of certificates for the Placement Shares shall be
made as agreed by the purchasers and the Company.
SECTION 5. Covenants of the Company. The Company covenants and
agrees that:
(a) If the Registration Statement has become or
becomes effective pursuant to Rule 430A of the Rules and Regulations, or the
filing of a Prospectus is otherwise required under Rule 424(b) of the Rules and
Regulations, the Company will file such Prospectus, properly completed, pursuant
to the applicable paragraph of Rule 424(b) of the Rules and Regulations within
the time period prescribed and will provide evidence satisfactory to you of such
timely filing. The Company will promptly advise you in writing of (i) the
receipt of any comments of the Commission, (ii) any request from the Commission
for an amendment of or supplement to the Registration Statement (either before
or after the Registration Statement becomes effective), any Preliminary
Prospectus or the Prospectus or for additional information, or (iii) the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the institution of any proceedings for that
purpose. If the Commission shall enter any such stop order at any time, the
Company will use its best efforts to obtain the lifting of such order at the
earliest possible moment. The Company will not file any amendment or supplement
to the Registration Statement (either before or after it becomes effective), any
Preliminary Prospectus or the Prospectus if you have not been furnished with a
copy of such amendment or supplement a reasonable time prior to such filing or
if you reasonably object to such amendment or supplement.
(b) The Company will prepare and file promptly with
the Commission any amendments or supplements to the Registration Statement or
the Prospectus that in the reasonable opinion of counsel for the Company or
counsel for the Agent may be necessary or advisable to enable the Agent to
continue the placement of the Placement Shares on behalf of the Company and will
use its best efforts to cause any such amendments or supplements to become
effective as promptly as possible. To the extent required by law, the Company
will fully and completely comply with the provisions of Rule 430A of the Rules
and Regulations with respect to information omitted from the Registration
Statement in reliance upon such Rule.
(c) As soon as practicable, but no later than 45 days
after the end of the first quarter following the one-year anniversary of the
"effective date of the Registration Statement" (as defined in Rule 158(c) of the
Rules and Regulations), the Company will make generally available to its
security holders an earnings statement (which need not be audited) covering a
period consisting of the twelve (12) consecutive months immediately following
the effective date of the Registration Statement, which statement will satisfy
the provisions of the last paragraph of Section 11(a) of the Act.
(d) During such period as a prospectus is required by
law to be delivered in connection with sales by a dealer, the Company, at its
expense, but only for the nine-month period referred to in Section 10(a)(3) of
the Act, will furnish to you or mail to your order copies of the Registration
Statement, the Prospectus, the Preliminary Prospectus and all amendments and
supplements to any such documents, in each case as soon as available and in such
quantities as you may request, for the purposes contemplated by the Act.
(e) The Company shall cooperate with you and your
counsel in order to qualify or register the Placement Shares for sale under (or
obtain exemptions from the application of) the Blue Sky laws of such
jurisdictions as you designate, and shall comply with such laws and maintain
such qualifications, registrations and exemptions so long as reasonably required
for the distribution of the Placement Shares. The Company shall not be required
to qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction where it is not presently qualified. The Company
shall advise you promptly of the suspension of the qualification or registration
of (or any such exemption relating to) the Placement Shares for offering, sale
or trading in any jurisdiction, or of the initiation or threat of any proceeding
for any such purpose, and in the event of the issuance of any order suspending
such qualification, registration or exemption, the Company, with your
cooperation, will use its best efforts to obtain the withdrawal thereof.
(f) For a period of five (5) years commencing on the
date hereof, the Company will furnish to you (i) as soon as practicable after
the end of each fiscal year, copies of the Annual Report of the Company
containing the balance sheet of the Company as of the close of such fiscal year
and statements of income, stockholders' equity and cash flows for the year then
ended and the opinion thereon of the Company's independent public accountants;
(ii) as soon as practicable after the filing thereof, copies of each proxy
statement, Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Report on
Form 8-K or other reports filed by the Company with the Commission, the NASD or
any securities exchange; and (iii) as soon as available, copies of any report or
communication of the Company mailed generally to holders of its Shares.
(g) The Company shall apply the net proceeds of the
sale of the Placement Shares sold by it substantially in accordance with its
statements under the caption "Use of Proceeds" in the Prospectus.
You may, in your sole discretion, waive in writing
the performance by the Company of any one or more of the foregoing covenants or
extend the time for their performance.
SECTION 6. Payment of Expenses. Except as set forth in Section
8, whether or not the transactions contemplated hereunder are consummated, you
and the Company each agree to pay all of your own costs, fees and expenses
incurred in connection with the performance of your respective obligations
hereunder and in connection with the transactions contemplated hereby.
SECTION 7. Conditions of the Obligations of the Agent. The
Company shall not complete the sale of any of the Placement Shares unless the
representations and warranties on the part of the Company herein set forth are
true as of the date of such sale and the consummation or settlement thereof (the
"Closing Date") and:
(a) The Registration Statement shall have become
effective by no later than 7:00 P.M. (or, in the case of a registration
statement filed pursuant to Rule 462(b) of the Rules and Regulations relating to
the Placement Shares, by no later than 10 P.M.), Washington, D.C. time, on the
date of this Agreement, or at such later time as shall have been consented to by
you; if the filing of the Prospectus, or any supplement thereto, is required
pursuant to Rule 424(b) of the Rules and Regulations, the Prospectus shall have
been filed in the manner and within the time period required by Rule 424(b) of
the Rules and Regulations; and prior to such Closing Date, no stop order
suspending the effectiveness of the Registration Statement shall have been
issued and no proceedings for that purpose shall have been instituted or shall
be pending or, to the knowledge of the Company or you, shall be contemplated by
the Commission; and any request of the Commission for inclusion of additional
information in the Registration Statement, or otherwise, shall have been
complied with.
(b) 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 authorized or issued share capital of the
Company other than pursuant to the exercise of outstanding options disclosed in
the Prospectus or the materials incorporated by reference therein 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, the Prospectus or the materials incorporated by
reference therein, no material verbal or written agreement or other transaction
shall have been entered into by the Company that is not in the ordinary course
of business or that could 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 that materially and adversely affects
the condition (financial or otherwise), business, results of operations or
prospects of the Company, (iv) no legal or governmental action, suit or
proceeding affecting the Company that is material to the Company or that affects
or may 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 that makes it impractical or inadvisable
in your judgment to proceed with the public offering or purchase of the
Placement Shares as contemplated hereby.
(c) There shall have been furnished to you, on the
Closing Date, in form and substance satisfactory to you, except as otherwise
expressly provided below:
(i) An opinion of Goodwin, Procter & Hoar
lLP, counsel for the Company, addressed to you to the effect set forth on
Appendix A hereto.
(ii) A certificate of the Company executed
by the Chief Executive Officer, the President and the Chief Financial Officer of
the Company, dated the Closing Date, to the effect that:
(1) The representations and
warranties of the Company set forth in Section 2 of this Agreement are true and
correct as of the date of this Agreement and as of the Closing Date, and the
Company has complied with all the agreements and satisfied all the conditions to
be performed or satisfied by it on or prior to the Closing Date;
(2) The Commission has not issued
any order preventing or suspending the use of the Prospectus or any Preliminary
Prospectus filed as a part of the Registration Statement or any amendment
thereto; no stop order suspending the effectiveness of the Registration
Statement has been issued; and to the best of the knowledge of the respective
signers, no proceedings for that purpose have been instituted or are pending or
contemplated under the Act;
(3) Each of the respective signers
of the certificate has carefully examined the Registration Statement and the
Prospectus; in his or her opinion and to the best of his or her knowledge, the
Registration Statement and the Prospectus and any amendments or supplements
thereto contain or incorporate by reference all statements required to be stated
therein regarding the Company and its subsidiaries; and neither the Registration
Statement nor the Prospectus nor any amendment or supplement thereto includes or
incorporates by reference any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading;
(4) Since the initial date on which
the Registration Statement was filed, no agreement, written or oral, transaction
or event has occurred that should have been set forth in an amendment to the
Registration Statement or in a supplement to or amendment of the Preliminary
Prospectus or the Prospectus which has not been disclosed in such a supplement
or amendment;
(5) Since the respective dates as of
which information is given in the Registration Statement and the Prospectus, and
except as disclosed in or contemplated by the Prospectus or the materials
incorporated by reference therein, there has not been any material adverse
change or a development involving a material adverse change in the condition
(financial or otherwise), business, properties, results of operations,
management or, to the best knowledge of the respective signing officers,
prospects of the Company, and no legal or governmental action, suit or
proceeding is pending or threatened against the Company that is material to the
Company, whether or not arising from transactions in the ordinary course of
business, or that may adversely affect the transactions contemplated by this
Agreement; since such dates and except as so disclosed, neither the Company nor
any of its subsidiaries has entered into any verbal or written agreement or
other transaction that is not in the ordinary course of business or that could
result in a material reduction in the future earnings of the Company or incurred
any material liability or obligation, direct, contingent or indirect, made any
change in its capital stock, made any material change in its short-term debt or
funded debt or repurchased or otherwise acquired any of the Company's capital
stock; and the Company has not declared or paid any dividend, or made any other
distribution upon its outstanding capital stock payable to stockholders of
record on a date prior to the Closing Date; and
(6) Since the respective dates as of
which information is given in the Registration Statement and the Prospectus and
except as disclosed in or contemplated by the Prospectus, the Company has not
sustained a material loss or damage by strike, fire, flood, windstorm, accident
or other calamity (whether or not insured).
(iii) A letter addressed to you from Arthur
Andersen, independent accountants, dated the Closing Date, to the effect set
forth on Appendix B hereto.
If any of the foregoing conditions is not satisfied, this
Agreement at your election will terminate upon notification by you to the
Company without liability on the part of the Agent or the Company except to the
extent provided in Section 8 or 9 hereof.
SECTION 8. Reimbursement of Agent' Expenses. Notwithstanding
any other provisions hereof, if, following the occurrence of any sale of
Placement Shares to any purchaser the sale is not consummated because of any
refusal, inability or failure on the part of the Company to perform any
agreement herein or to comply with any provision hereof, the Company agrees to
reimburse you upon demand for all out-of-pocket expenses that shall have been
reasonably incurred by you in connection with the proposed sale of the Placement
Shares, including but not limited to reasonable fees and disbursements of
counsel, printing expenses, travel expenses, postage, facsimile charges,
telegraph charges and telephone charges relating directly to the offering
contemplated by the Registration Statement. Any such failure to consummate a
sale of Placement Shares shall not create liability of any party to any other
party, except that the provisions of Section 6, this Section 8 and Section 9
shall at all times continue to be effective and applicable.
SECTION 9. Indemnification.
(a) The Company agrees to indemnify and hold harmless
the Agent, and each person, if any, who controls the Agent within the meaning of
the Act, against any losses, claims, damages, liabilities or expenses (including
amounts paid in settlement of any litigation, if such settlement is effected
with the written consent of the Company), whether joint or several, to which the
Agent or such controlling person may become subject under the Act, the Exchange
Act or any other federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or expenses (or
actions in respect thereof as contemplated below) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact contained
in the Registration Statement, any Preliminary Prospectus, the Prospectus, or
any amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state in any of such documents a material fact
required to be stated therein or necessary to make the statements therein not
misleading; and will reimburse each Agent and each such controlling person for
any legal and other expenses as such expenses are reasonably incurred by such
Agent or such controlling person in connection with investigating, defending,
settling, compromising or paying any such losses, claims, damages, liabilities,
expenses or actions; provided, however, that the Agent and/or any controlling
person of the Agent will not be reimbursed for amounts paid in settlement of any
litigation unless the Company consented to such settlement in writing before it
was effected; and provided further that the Company will not be liable in any
such case to the extent that any such losses, claims, damages, liabilities,
expenses or actions arise out of or are based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
amendment or supplement thereto in reliance upon and in conformity with the
information furnished to the Company pursuant to Section 3 hereof. In addition
to its other obligations under this Section 9(a), the Company 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 alleged statement or omission, or any inaccuracy in the representations and
warranties of the Company herein or failure to perform its obligations
hereunder, all as described in this Section 9(a), it will reimburse each Agent
on a quarterly basis for all reasonable legal or other 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 Company's
obligation to reimburse each Agent 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 Agent shall promptly (and in any event no later
than thirty (30) days after the date such payments are finally held to be
improper) return such payment to the Company together with interest, compounded
daily, determined on the basis of the prime rate (or other commercial lending
rate for borrowers of the highest credit standing) announced from time to time
by Bank of America NT&SA, San Francisco, California (the "Prime Rate"). Any
interim reimbursement payment that is required to be made by the Company
hereunder and is not made by the Company within thirty (30) days of the
Company's receipt of a request for reimbursement by the Agent shall bear
interest at the Prime Rate from the date of such request until paid in full.
This indemnity agreement will be in addition to any liability which the Company
may otherwise have.
(b) The Agent will severally indemnify and hold
harmless the Company, each of its directors, each of its officers who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of the Act, against any losses, claims, damages, liabilities or
expenses (including in any amounts paid in settlement of any litigation, if such
settlement is effected with the written consent of such Agent) to which the
Company, of any such director, officer or controlling person may become subject,
under the Act, the Exchange Act or any other federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims, damages,
liabilities or expenses (or actions in respect thereof as contemplated below)
arise out of or are based upon any untrue or alleged untrue statement of any
material fact contained in the Registration Statement, any Preliminary
Prospectus, the Prospectus, or any amendment or supplement thereto, or arise out
of or are based upon the omission or alleged omission to state in any of such
documents a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in the Registration Statement, any Preliminary
Prospectus, the Prospectus, or any amendment or supplement thereto, in reliance
upon and in conformity with the information furnished to the Company pursuant to
Section 3 hereof; and will reimburse the Company, or any such director, officer
or controlling person for any legal and other expense reasonably incurred by the
Company, or any such director, officer or controlling person in connection with
investigating, defending, settling, compromising or paying any such losses,
claims, damages, liabilities, expenses or actions. In addition to its other
obligations under this Section 9(b), each Agent 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 alleged statement or omission, described in this Section 9(b) which relates
to information furnished to the Company pursuant to Section 3 hereof, it will
reimburse the Company (and, to the extent applicable, each officer, director or
controlling person) on a quarterly basis for all reasonable legal or other
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
Agent's obligation to reimburse the Company (and, to the extent applicable, each
officer, director or controlling person) 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, the Company (and, to the extent
applicable, each officer, director or controlling person) shall promptly (and in
any event no later than thirty (30) days after such payment is finally held to
be improper) return it to the Agent together with interest, compounded daily,
determined on the basis of the Prime Rate. Any interim reimbursement payment
which the Agent is required to make hereunder that is not made by the Agent
within thirty (30) days of the Agent's receipt of a request for reimbursement by
the Company (or the officer, director or controlling person, as the case may
be), shall bear interest at the Prime Rate from the date of such request until
paid in full. This indemnity agreement will be in addition to any liability
which such Agent may otherwise have.
(c) Promptly after receipt by an indemnified party under this
Section 9 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against an indemnifying party
under this Section 9, notify the indemnifying party in writing of the
commencement thereof; provided that failure by the indemnified party to so
notify the indemnifying party will not relieve the indemnifying party from any
liability which it may have to any indemnified party for contribution or
otherwise than under this Section 9 or to the extent the indemnifying party is
not prejudiced as a proximate result of such failure to notify. In case any such
action is brought against any indemnified party and such indemnified party seeks
or intends to seek indemnity from an indemnifying party, the indemnifying party
will be entitled to participate in, and, to the extent that it may wish, jointly
with all other indemnifying parties similarly notified, assume the defense
thereof with counsel reasonably satisfactory to such indemnified party;
provided, however, that if the defendants in any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be a conflict between the positions of
the indemnifying party and the indemnified party in conducting the defense of
any such action or that there may be legal defenses available to it and/or other
indemnified parties which are different from or additional to those available to
the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assume such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties (it being understood, however, that the indemnifying party shall not be
liable for the expenses of more than one separate counsel, reasonably approved
by the Agent in the case of paragraph (a), representing the indemnified parties
which are parties to such action). Upon receipt of notice from the indemnifying
party to such indemnified party of its election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party under this Section 9 for any legal
or other expenses subsequently incurred by such indemnified party in connection
with the defense thereof unless (i) the indemnified party shall have employed
such counsel in connection with the assumption of legal defenses in accordance
with the proviso to the next preceding sentence or (ii) the indemnifying party
shall not have employed counsel reasonably satisfactory to the indemnified party
to represent the indemnified party within a reasonable time after notice of
commencement of the action, in each of which cases the reasonable fees and
expenses of counsel for the indemnified party shall be at the expense of the
indemnifying party.
(d) If the indemnification provided for in this
Section 9 is required by its terms but is for any reason held to be unavailable
to or otherwise insufficient to hold harmless an indemnified party under
paragraphs (a), (b) or (c) in respect of any losses, claims, damages,
liabilities or expenses referred to herein, then each applicable indemnifying
party shall contribute to the amount paid or payable by such indemnified party
as a result of any losses, claims, damages, liabilities or expenses referred to
herein (i) in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Agent from the offering of the Placement 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 the Agent in connection with the statements or omissions or
inaccuracies in the representations and warranties herein which resulted in such
losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The respective relative benefits received by the
Company and the Agent shall be deemed to be in the same proportion, in the case
of the Company, as the total price paid to the Company for the Placement Shares
sold by them less the commissions to the Agent contemplated hereby (but before
deducting expenses) bears to the total price paid to the Company by the
purchasers before deducting such commissions, and in the case of the Agent as
the commissions received by them bears to the total price paid to the Company by
the purchasers before deducting such commissions. The relative fault of the
Company and the Agent 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 or the inaccurate or the
alleged inaccurate representation and/or warranty relates to information
supplied by the Company or the Agent, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses referred to above shall be
deemed to include, subject to the limitations set forth in subparagraph (c) of
this Section 9, any legal or other fees or expenses reasonably incurred by such
party in connection with investigating or defending any action or claim. The
provisions set forth in subparagraph (c) of this Section 9 with respect to
notice of commencement of any action shall apply if a claim for contribution is
to be made under this subparagraph (d); provided, however, that no additional
notice shall be required with respect to any action for which notice has been
given under subparagraph (c) for purposes of indemnification. The Company and
the Agent agree that it would not be just and equitable if contribution pursuant
to this Section 9 were determined solely by pro rata allocation (even if the
Agent were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to in the immediately preceding paragraph. Notwithstanding the provisions of
this Section 9, Agent shall not be required to contribute any amount in excess
of the amount of the total commissions received by Agent in connection with the
Placement Shares. 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 Agent's
obligations to contribute pursuant to this Section 9 are several and not joint.
(e) It is agreed that any controversy arising out of
the operation of the interim reimbursement arrangements set forth in Sections
9(a) and 9(b) hereof, including the amounts of any requested reimbursement
payments and the method of determining such amounts, shall be settled by
arbitration conducted pursuant to the NASD's Code of Arbitration Procedure. 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. The scope of
any such arbitration shall be limited to the operation of the interim
reimbursement provisions contained in Sections 9(a) and 9(b) hereof and shall
not resolve the ultimate propriety or enforceability of the obligation to
reimburse expenses which is created by the provisions of this Section 9.
SECTION 10. Termination. Without limiting the right to
terminate this Agreement pursuant to any other provision hereof:
(a) The Company may terminate this Agreement at any
time prior to any sale of Placement Shares.
(b) This Agreement shall also terminate at 5:00 P.M.,
California time, on the fifteenth full business day following the date on which
the Registration Statement shall have become effective if no sale of Placement
Shares shall have occurred at or prior to such time. Any termination pursuant to
this subsection (b) shall be without liability on the part of the Agent to the
Company or on the part of the Company to the Agent except to the extent provided
in Section 8 or Section 9 hereof.
SECTION 11. Representations and Indemnities to Survive
Delivery. The respective indemnities, agreements, representations, warranties
and other statements of the Company and of its officers and of the Agent set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation made by or on behalf of the Agent or the
Company or any of its or their partners, officers or directors, or any
controlling person, as the case may be. The respective indemnities,
representations and warranties of the Company and the Agent will survive
delivery of and payment for the Placement Shares sold hereunder and any
termination of this Agreement.
SECTION 12. Notices. All communications hereunder shall be in
writing and, if sent to the Agent shall be mailed, delivered or telegraphed and
confirmed to you at Pacific Growth Equities, 353 Sacramento Street, San
Francisco, California 94111, Attention: George J. Milstein; with a copy to
Howard, Rice, Nemerovski, Canady, Falk & Rabkin, A Professional Corporation,
Three Embarcadero Center, 7th Floor, San Francisco, California 94111, Attention:
Mark D. Whatley; and if sent to the Company shall be mailed, delivered or
telegraphed and confirmed to the Company at 4651 Sheridan Street, Suite 400,
Hollywood, Florida 33021, Attention: Mitchell Eisenberg, M.D.; with a copy to
Goodwin, Procter & Hoar LLP, Exchange Place, Boston, Massachusetts, 02109,
Attention: Kevin M. Dennis. The Company or you may change the address for
receipt of communications hereunder by giving notice to the others.
SECTION 13. Successors. This Agreement will inure to the
benefit of and be binding upon the parties hereto, and to the benefit of the
officers and directors and controlling persons referred to in Section 9, and in
each case their respective successors, personal representatives and assigns, and
no other person will have any right or obligation hereunder. No such assignment
shall relieve any party of its obligations hereunder. The term "successors"
shall not include any purchaser of the Placement Shares as such merely by reason
of such purchase.
SECTION 14. Partial Unenforceability. The invalidity or
unenforceability of any Section, paragraph or provision of this Agreement shall
not affect the validity or enforceability of any other Section, paragraph or
provision hereof. If any Section, paragraph or provision of this Agreement is
for any reason determined to be invalid or unenforceable, there shall be deemed
to be made such minor changes (and only such minor changes) as are necessary to
make the Agreement valid and enforceable.
SECTION 15. Applicable Law. This Agreement shall be governed
by and construed in accordance with the internal laws (and not the laws
pertaining to conflicts of laws) of the State of California.
SECTION 16. General. This Agreement constitutes the entire
agreement of the parties to this Agreement and supersedes all prior written or
oral and all contemporaneous oral agreements, understandings and negotiations
with respect to the subject matter hereof. This Agreement may be executed in
several counterparts, each one of which shall be an original, and all of which
shall constitute one and the same document.
In this Agreement, the masculine, feminine and neuter genders
and the singular and the plural include one another. The section headings in
this Agreement are for the convenience of the parties only and will not affect
the construction or interpretation of this Agreement. This Agreement may be
amended or modified, and the observance of any term of this Agreement may be
waived, only by a writing signed by the Company and you.
If the foregoing is in accordance with your understanding of
our agreement, kindly sign and return to us the enclosed copies hereof,
whereupon it will become a binding agreement between the Company and the Agent,
all in accordance with its terms.
Very truly yours,
SHERIDAN HEALTH CARE, INC.
By:
--------------------------------------------
Mitchell Eisenberg, M.D.
Chairman, President and Chief
Executive Officer
The foregoing Placement Agreement is
hereby confirmed and accepted by us
in San Francisco, California as of
the date first above written.
PACIFIC GROWTH EQUITIES, INC.
By:
-----------------------------
George J. Milstein
Authorized Signatory
EXHIBIT A
SCHEDULE OF PURCHASERS OF PLACEMENT SHARES
APPENDIX A
FORM OF OPINION OF GOODWIN, PROCTER & HOAR LLP,
COUNSEL TO THE COMPANY
PURSUANT TO SECTION 7(C)(I)
APPENDIX B
FORM OF LETTER FROM ARTHUR ANDERSEN
PURSUANT TO SECTION 7(C)(III)