<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________
FORM 8-B
FOR REGISTRATION OF SECURITIES OF
CERTAIN SUCCESSOR ISSUERS
FILED PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
WELLPOINT HEALTH NETWORKS INC.
(Exact name of registrant as specified in its Charter)
DELAWARE 95-4635504
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(State of incorporation or organization) (IRS Employer
Identification No.)
21555 OXNARD STREET, WOODLAND HILLS, CA 91367
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (818) 703-4000
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Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
------------------- ------------------------------
Common Stock, $0.01 par value New York Stock Exchange
----------------------------- -----------------------
Securities to be registered pursuant to Section 12(g) of the Act:
N/A
- --------------------------------------------------------------------------------
(Title of Class)
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ITEM 1. GENERAL INFORMATION
The registrant, WellPoint Health Networks Inc., a Delaware corporation
("WellPoint Delaware" or the "registrant"), was organized on August 29, 1996,
as a corporation under the laws of the State of Delaware. The registrant's
fiscal year ends on December 31.
ITEM 2. TRANSACTION OF SUCCESSION
WellPoint Health Networks Inc., a California corporation ("WellPoint
California"), formed the registrant for the purpose of creating a holding
company structure. Pursuant to the terms of an Agreement and Plan of
Reorganization, this structure will be accomplished, prior to the effectiveness
of this registration statement, by a merger (the "Merger") of a subsidiary of
WellPoint Delaware (the "WLP Acquisition Corp." or "Merger Sub") with and into
WellPoint California, as a result of which the registrant will become the
parent of WellPoint California. The transaction is more fully explained in the
Definitive Proxy Statement on Schedule 14A dated May 9, 1997 of WellPoint
California (the "Proxy Statement"), which is an exhibit hereto.
The Common Stock, $0.01 par value, of WellPoint California is
registered pursuant to Section 12(b) of the Securities Exchange Act of 1934, as
amended (the "1934 Act") and WellPoint California files periodic reports under
the 1934 Act (File No. 1-11628). Prior to the effectiveness of this
registration statement, the registrant will become the successor registrant to
WellPoint California's registration of WellPoint California's Common Stock,
$0.01 par value. The Merger will cause each share of WellPoint California's
Common Stock, $0.01 par value, to be converted into one (1) fully paid and
nonassessable share of WellPoint Delaware Common Stock, 0.01 par value.
ITEM 3. SECURITIES TO BE REGISTERED
The registrant is authorized to issue 300,000,000 shares of WellPoint
Delaware Common Stock, $0.01 par value. Upon the Merger and prior to the
effectiveness of this registration statement, approximately 69,609,709 shares
of the registrant's common stock, $0.01 par value, will be issued and
outstanding, none of which will be held by or for the account of the
registrant.
ITEM 4. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED
The registrant's common stock, $0.01 par value, is described in the
Proxy Statement of WellPoint California. The sections entitled "Description of
WellPoint Delaware Certificate of Incorporation and Bylaws" and "Description of
WellPoint Delaware Securities" are incorporated by reference herein.
ITEM 5. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements.
With reference to holders of the registrant's common stock, $0.01
par value, the capital structure and balance sheet of the registrant
immediately after the Merger will be substantially the same as those of
WellPoint California immediately prior to the Merger. Accordingly, no
financial statements are filed with this registration statement.
(b) Exhibits.
(A) Definitive Proxy Statement on Schedule 14A of WellPoint
California, dated May 9, 1997, including (i) an Agreement and
Plan of Reorganization, which is attached as Appendix C to the
Proxy Statement and (ii) an Agreement of Merger, which is
attached as Exhibit A to the Agreement and Plan of
Reorganization, is incorporated by reference herein.
(B) All other exhibits which would be called for by Form 10 if the
Securities to be registered hereunder were to be registered on
that form.
2.
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3.1 Restated Certificate of Incorporation of WellPoint Delaware,
attached as Appendix A to the Proxy Statement and incorporated
by reference herein.
3.2 Bylaws of WellPoint Delaware, attached as Appendix B to the
Proxy Statement and incorporated by reference herein.
4.4 Specimen Stock Certificate of WellPoint Delaware.
9.01 Voting Trust Agreement dated as of May 20, 1996, by and
between the WellPoint California, Western Health Partnerships
and Wilmington Trust Company, incorporated by reference to
Exhibit 99.2 of WellPoint California's Form 8-K dated May 20,
1996
9.02 Form of Amended and Restated Voting Trust Agreement by and
among California HealthCare Foundation (the "Foundation") and
Wilmington Trust Company
10.01 Line of Business Assignment and Assumption Agreement dated as
of February 1, 1993, among WellPoint California, its
subsidiaries and Blue Cross of California ("BCC"),
incorporated by reference to Exhibit 10.01 of WellPoint
California's Form 10-K for the fiscal year ended December 31,
1992
10.02 Administrative Services and Product Marketing Agreement dated
as of February 1, 1993, among WellPoint California, its
subsidiaries and BCC, incorporated by reference to Exhibit
10.02 of WellPoint California's Form 10-K for the fiscal year
ended December 31, 1992
10.03 Master Subscriber Agreements dated as of January 27, 1993,
between WellPoint California's subsidiaries and BCC,
incorporated by reference to Exhibit 10.03 of Registrant's
Form 10-K for the fiscal year ended December 31, 1992
10.04 Tax Allocation Agreement dated as of February 1, 1993, among
WellPoint California, its subsidiaries and BCC and its
subsidiaries, incorporated by reference to Exhibit 10.04 of
WellPoint California's Form 10-K for the fiscal year ended
December 31, 1992
10.05 Office Space Lease for Oakland, CA offices, dated December 10,
1985, between BCC and Webster Street Partners, Ltd.,
incorporated by reference to Exhibit 10.06 of WellPoint
California's Form S-1 Registration Statement No. 33-54898
10.06 Office Space Lease for Westlake, CA offices, dated October 29,
1986, between BCC and Westlake Business Park, Ltd.,
incorporated by reference to Exhibit 10.07 of WellPoint
California's Form S-1 Registration Statement No. 33-54898
10.07 Administrative Agreement, dated as of June 1, 1988, between
BCC and INSURx, Inc., incorporated by reference to Exhibit
10.08 of WellPoint California's Form S-1 Registration
Statement No. 33-54898
10.08 Undertakings dated January 7, 1993, by BCC, WellPoint
California and WellPoint California's subsidiaries to the
California Department of Corporations, incorporated by
reference to Exhibit 10.24 of WellPoint California's Form S-1
Registration Statement No. 33-54898
10.09 Office Space Lease for Newbury Park, CA offices, dated January
13, 1993, between BCC and Metropolitan Life Insurance Company,
incorporated by reference to Exhibit 10.12 of WellPoint
California's Form 10-K for the fiscal year ended December 31,
1992
10.10 Office Space Lease for Calabasas, CA offices, dated August 26,
1992, between BCC and Lost Hills Office Partners, First
Amendment to Office Lease between Lost Hills Office Partners
and BCC, dated November 1, 1992, and Subordination,
Non-Disturbance and Attornment Agreement, dated January 7,
1993, between BCC and DAG Management, incorporated by
reference to Exhibit 10.13 of WellPoint California's Form 10-K
for the fiscal year ended December 31, 1992
3.
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10.11 WellPoint Health Networks Inc. Officer Change in Control Plan,
incorporated by reference to Exhibit 10.14 of WellPoint
California's Form 10-K for the fiscal year ended December 31,
1993
10.12 Supplemental Pension Plan of Blue Cross of California,
incorporated by reference to Exhibit 10.15 of WellPoint
California's Form 10-K for the fiscal year ended December 31,
1992
10.13 Blue Cross of California Deferred Compensation Plan,
incorporated by reference to Exhibit 10.13 of WellPoint
California's Form S-1 Registration Statement No. 33-54898
10.14 Form of Supplemental Life and Disability Insurance Policy,
incorporated by reference to Exhibit 10.14 of WellPoint
California's Form S-1 Registration Statement No. 33-54898
10.15 Special Executive Retirement Plan dated as of March 29, 1993,
among BCC, WellPoint California and Leonard D. Schaeffer,
incorporated by reference to Exhibit 10.19 of WellPoint
California's Form 10-K for the fiscal year ended December 31,
1992
10.16 Form of Indemnification Agreement between WellPoint California
and its Directors and Officers, incorporated by reference to
Exhibit 10.17 of WellPoint California's Form S-1 Registration
Statement No. 33-54898
10.17 Officer Severance Agreement, dated as of July 1, 1993, between
WellPoint California and Thomas C. Geiser, incorporated by
reference to Exhibit 10.24 of WellPoint California's Form 10-K
for the fiscal year ended December 31, 1993
10.18 First Amendment to Special Executive Retirement Plan dated as
of March 29, 1993, among BCC, WellPoint California and Leonard
D. Schaeffer (Exhibit 10.19), effective January 1, 1993,
incorporated by reference to Exhibit 10.25 of WellPoint
California's Form 10-K for the fiscal year ended December 31,
1993
10.19 Executive Benefiting You Highlights Brochure, incorporated by
reference to Exhibit 10.29 of WellPoint California's Form 10-K
for the fiscal year ended December 31, 1993
10.20 WellPoint Health Networks Inc. Officer Change in Control Plan
as amended January 5, 1995, incorporated by reference to
Exhibit 10.33 of WellPoint California's Form 10-K for the
fiscal year ended December 31, 1994
10.21 Form of Officer Severance Agreement of WellPoint California,
incorporated by reference to Exhibit 10.32 of WellPoint
California's Form 10-K for the fiscal year ended December 31,
1994
10.22 WellPoint Health Networks Inc. Management Retention Agreement
between WellPoint California and Ronald A. Williams, amended
and restated effective as of January 5, 1995, incorporated by
reference to Exhibit 10.35 of WellPoint California's Form 10-K
for the fiscal year ended December 31, 1994
10.23 WellPoint Health Networks Inc. Management Retention Agreement
between WellPoint California and D. Mark Weinberg, amended and
restated effective as of January 5, 1995, incorporated by
reference to Exhibit 10.36 of WellPoint California's Form 10-K
for the fiscal year ended December 31, 1994
10.24 Amendment to Administrative Services and Product Marketing
Agreement dated as of February 1, 1993, among WellPoint
California, its subsidiaries and BCC (Exhibit 10.02), amended
as of January 1, 1995, incorporated by reference to Exhibit
10.39 of WellPoint California's Form 10-K for the fiscal year
ended December 31, 1994
4.
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10.25 Amendment to Administrative Services and Product Marketing
Agreement dated as of February 1, 1993, among WellPoint
California, its subsidiaries and BCC (Exhibit 10.02), amended
as of February 1, 1995, incorporated by reference to Exhibit
10.40 of WellPoint California's Form 10-K for the fiscal year
ended December 31, 1994
10.26 Agreement of Purchase and Sale and Escrow Instructions, dated
as of December 16, 1994, between WellPoint California and
Pardee Construction Company, incorporated by reference to
Exhibit 10.41 of WellPoint California's Form 10-K for the
fiscal year ended December 31, 1994
10.27 Credit Agreement, dated as of October 19, 1994, among
WellPoint California, Bank of America, National Trust and
Savings Association, Chemical Bank and Other Financial
Institutions, incorporated by reference to Exhibit 10.43 of
WellPoint California's Form 10-K for the fiscal year ended
December 31, 1994
10.28 First Amendment to Credit Agreement, dated as of March 7,
1995, among WellPoint California, Bank of America National
Trust and Savings Association, and other Financial
Institutions, incorporated by reference to Exhibit 10.44 of
WellPoint California's Form 10-K for the fiscal year ended
December 31, 1994
10.29 Orders Approving Notice of Material Modification and
Undertakings dated September 7, 1995, by BCC, WellPoint
California and WellPoint California's subsidiaries to the
California Department of Corporations, incorporated by
reference to Exhibit 10.47 of WellPoint California's Form 10-Q
for the quarter ended September 30, 1995
10.30 Second Amendment to Credit Agreement, dated as of October 16,
1995, among WellPoint California, Bank of America National
Trust and Savings Associations and other Financial
Institutions, incorporated by reference to Exhibit 10.48 of
WellPoint California's Form 10-Q for the quarter ended
September 30, 1995
10.31 WellPoint Health Networks Inc. Stock Option/Award Plan as
amended January 15, 1997, incorporated by reference to Exhibit
D of WellPoint California's Definitive Proxy Statement on
Schedule 14A dated May 9, 1997.
10.32 Lease Agreement, dated as of January 1, 1996, by and between
TA/Warner Center Associates II, L.P., and WellPoint
California, incorporated by reference to Exhibit 10.46 of
WellPoint California's Form 10-K for the fiscal year ended
December 31, 1995
10.33 Letter, dated November 13, 1995, from WellPoint California to
Ronald A. Williams regarding severance benefits, together with
underlying Officer Severance Agreement, incorporated by
reference to Exhibit 10.47 of WellPoint California's Form 10-K
for the fiscal year ended December 31, 1995
10.34 Letter, dated November 13, 1995, from WellPoint California to
D. Mark Weinberg regarding severance benefits, together with
underlying Officer Severance Agreement, incorporated by
reference to Exhibit 10.48 of WellPoint California's Form 10-K
for the fiscal year ended December 31, 1995
10.35 Letter, dated November 13, 1995, from WellPoint California to
Thomas C. Geiser regarding severance benefits, incorporated by
reference to Exhibit 10.49 of WellPoint California's Form 10-K
for the fiscal year ended December 31, 1995
10.36 Amended and Restated Undertakings dated March 5, 1996, by BCC,
WellPoint California and WellPoint California's Subsidiaries
to the California Department of Corporations, incorporated by
reference to Exhibit 99.1 of WellPoint California's Current
Report on Form 8-K dated March 5, 1996
5.
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10.37 Senior Series A Term Note dated March 31, 1996, between
WellPoint California and Massachusetts Mutual Life Insurance
Company, incorporated by reference to Exhibit 10.53 of
WellPoint California's Form 10-Q for the quarter ended March
31, 1996
10.38 Voting Agreement dated as of May 8, 1996, by and among
WellPoint California and Western Health Partnerships,
incorporated by reference to Exhibit 99.3 of WellPoint
California's Form 8-K dated May 20, 1996
10.39 Share Escrow Agent Agreement dated as of May 20, 1996, by and
between WellPoint California and U.S. Trust Company of
California, N.A., incorporated by reference to Exhibit 99.4 of
WellPoint California's Form 8-K dated May 20, 1996
10.40 Registration Rights Agreement dated as of May 20, 1996, by and
between WellPoint California and Western Health Partnerships,
incorporated by reference to Exhibit 99.5 of WellPoint
California's Form 8-K dated May 20, 1996
10.41 Blue Cross License Agreement effective as of May 20, 1996, by
and among the Blue Cross and Blue Shield Association and
WellPoint California (supersedes Exhibit 10.09), incorporated
by reference to Exhibit 99.6 of WellPoint California's Form
8-K dated May 20, 1996
10.42 California Blue Cross License Addendum effective as of May 20,
1996, by and between the Blue Cross and Blue Shield
Association and WellPoint California, incorporated by
reference to Exhibit 99.7 of WellPoint California's Form 8-K
dated May 20, 1996
10.43 Blue Cross Affiliated License Agreement effective as of May
20, 1996, by and between the Blue Cross and Blue Shield
Association and CaliforniaCare Health Plans, incorporated by
reference to Exhibit 99.8 of WellPoint California's Form 8-K
dated May 20, 1996
10.44 Indemnification Agreement dated as of May 17, 1996, by and
among WellPoint California, WellPoint Health Networks Inc., a
Delaware corporation, and Western Health Partnerships,
incorporated by reference to Exhibit 99.9 of WellPoint
California's Form 8-K dated May 20, 1996
10.45 Credit Agreement dated as of May 15, 1996, by and among
WellPoint California, Bank of America National Trust and
Savings Association ("Bank of America"), as Administrative
Agent, NationsBank of Texas, N.A., as Syndication Agent,
Chemical Bank, as Documentation Agent, and the other financial
institutions named therein, incorporated by reference to
Exhibit 99.10 of WellPoint California's Form 8-K dated May 20,
1996
10.46 WellPoint Health Networks Inc. Employee Stock Option Plan,
incorporated by reference to WellPoint California's
Registration Statement on Form S-8 (Registration No. 33-05111)
10.47 WellPoint Health Networks Inc. Employee Stock Purchase Plan,
incorporated by reference to WellPoint California's
Registration Statement on Form S-8 (Registration No.
333-05111)
10.48 Amendment No. 1 dated as of June 28, 1996, to WellPoint
California's Credit Agreement dated as of May 15, 1996,
incorporated by reference to Exhibit 10.65 of WellPoint
California's Form 10-Q for the quarter ended September 30,
1996
10.49 Subordinated Term Loan Agreement dated as of November 21,
1996, by and among WellPoint California, Bank of America and
the other parties named therein, incorporated by reference to
Exhibit 99.1 to WellPoint California's Current Report on Form
8-K filed December 12, 1996
10.50 Employment Agreement dated as of January 22, 1997, by and
between WellPoint California and Leonard D. Schaeffer
incorporated by reference to Exhibit 10.50 of WellPoint
California's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996
6.
<PAGE> 7
10.51 Modification Agreement dated as of November 26, 1996 by and
between WellPoint California and California HealthCare
Foundation incorporated by reference to Exhibit 10.51 of
WellPoint California's Annual Report on Form 10-K for the
fiscal year ended December 31, 1996
10.52 Coinsurance Agreement dated as of March 1, 1997 between John
Hancock and UNICARE Life & Health Insurance Company
("UNICARE"), incorporated by reference to Exhibit 99.2 of
WellPoint California's Current Report on Form 8-K filed March
14, 1997
10.53 Administration Agreement dated as of March 1, 1997 between
John Hancock and UNICARE, incorporated by reference to Exhibit
99.3 of WellPoint California's Current Report on Form 8-K
filed March 14, 1997
10.54 Amendment No. 1 dated as of February 11, 1997 to WellPoint
California's Subordinated Term Loan Agreement dated as of
November 21, 1996 incorporated by reference to Exhibit 10.54
of WellPoint California's Annual Report on Form 10-K for the
fiscal year ended December 31, 1996
10.55 Blue Cross Affiliate License Agreement by and between BC Life
& Health Insurance Company and the BCBSA incorporated by
reference to Exhibit 10.55 of WellPoint California's Annual
Report on Form 10-K for the fiscal year ended December 31,
1996
10.56 Blue Cross Controlled Affiliate License Agreement Applicable
to Life Insurance Companies by and between BC Life & Health
Insurance Company and the BCBSA incorporated by reference to
Exhibit 10.56 of WellPoint California's Annual Report on Form
10-K for the fiscal year ended December 31, 1996
10.57 Second Amendment dated as of April 21, 1997 to WellPoint
California's Credit Agreement dated as of May 15, 1996
incorporated by reference to Exhibit 10.55 of WellPoint
California's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1997.
10.58 Third Amendment dated as of April 21, 1997 to WellPoint
California's Credit Agreement dated as of May 15, 1996
incorporated by reference to Exhibit 10.56 of WellPoint
California's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1997.
10.59 Second Amendment dated as of April 21, 1997 to WellPoint
California's Subordinated Term Loan Agreement dated as of
November 21, 1996 incorporated by reference to Exhibit 10.57
of WellPoint California's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1997.
10.60 WellPoint Health Networks Inc.'s Employee Stock Purchase Plan
as amended and restated effective January 1, 1988.
10.61 Form of Amended and Restated Voting Agreement by and among
WellPoint California, WellPoint Delaware and the Foundation
10.62 Form of Amended and Restated Registration Rights Agreement by
and among WellPoint California, WellPoint Delaware and the
Foundation
10.63 Form of Amended and Restated Share Escrow Agent Agreement by
and among WellPoint Delaware and U.S. Trust Company of
California
21 Subsidiaries of WellPoint Health Networks Inc. filed as
Exhibit 21 to WellPoint Health Networks Inc.'s Annual Report
on Form 10-K for the fiscal year ended December 31, 1996, and
incorporated by reference herein.
7.
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the registrant has duly caused this registration statement to be
signed on its behalf by the undersigned, thereunto duly authorized.
WELLPOINT HEALTH NETWORKS INC.
Dated: June 12, 1997 By: /s/ Thomas C. Geiser
---------------------------
Thomas C. Geiser
Executive Vice President
<PAGE> 9
EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION
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(A) The Definitive Proxy Statement on Schedule 14A of
WellPoint California, dated May 9, 1997, including (i) an
Agreement and Plan of Reorganization, attached as Appendix
C to the Proxy Statement and (ii) an Agreement of Merger,
attached as Exhibit A to the Proxy Statement, is
incorporated by reference herein.
(B) All other exhibits which would be called for by Form 10 if
the Securities to be registered hereunder were to be
registered on that form.
3.1 Restated Certificate of Incorporation of WellPoint
Delaware, attached as Appendix A to the Proxy Statement,
is incorporated by reference herein.
3.2 Bylaws of WellPoint Delaware, attached as Appendix B to
the Proxy Statement, is incorporated by reference herein.
4.4 Specimen Stock Certificate of WellPoint Delaware.
9.01 Voting Trust Agreement dated as of May 20, 1996, by and
between the WellPoint California, Western Health
Partnerships and Wilmington Trust Company, incorporated by
reference to Exhibit 99.2 of WellPoint California's Form
8-K dated May 20, 1996
9.02 Form of Amended and Restated Voting Trust Agreement
by and among California HealthCare Foundation (the
"Foundation") and Wilmington Trust Company
10.01 Line of Business Assignment and Assumption Agreement dated
as of February 1, 1993, among WellPoint California, its
subsidiaries and BCC, incorporated by reference to Exhibit
10.01 of WellPoint California's Form 10-K for the fiscal
year ended December 31, 1992
10.02 Administrative Services and Product Marketing Agreement
dated as of February 1, 1993, among WellPoint California,
its subsidiaries and BCC, incorporated by reference to
Exhibit 10.02 of WellPoint California's Form 10-K for the
fiscal year ended December 31, 1992
10.03 Master Subscriber Agreements dated as of January 27, 1993,
between WellPoint California's subsidiaries and BCC,
incorporated by reference to Exhibit 10.03 of WellPoint
California's Form 10-K for the fiscal year ended December
31, 1992
10.04 Tax Allocation Agreement dated as of February 1, 1993,
among WellPoint California, its subsidiaries and BCC and
its subsidiaries, incorporated by reference to Exhibit
10.04 of WellPoint California's Form 10-K for the fiscal
year ended December 31, 1992
10.05 Office Space Lease for Oakland, CA offices, dated December
10, 1985, between BCC and Webster Street Partners, Ltd.,
incorporated by reference to Exhibit 10.06 of WellPoint
California's Form S-1 Registration Statement No. 33-54898
10.06 Office Space Lease for Westlake, CA offices, dated October
29, 1986, between BCC and Westlake Business Park, Ltd.,
incorporated by reference to Exhibit 10.07 of WellPoint
California's Form S-1 Registration Statement No. 33-54898
10.07 Administrative Agreement, dated as of June 1, 1988,
between BCC and INSURx, Inc., incorporated by reference to
Exhibit 10.08 of WellPoint California's Form S-1
Registration Statement No. 33-54898
A-1.
<PAGE> 10
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
10.08 Undertakings dated January 7, 1993, by BCC, WellPoint
California and WellPoint California's subsidiaries to the
California Department of Corporations, incorporated by
reference to Exhibit 10.24 of WellPoint California's Form
S-1 Registration Statement No. 33-54898
10.09 Office Space Lease for Newbury Park, CA offices, dated
January 13, 1993, between BCC and Metropolitan Life
Insurance Company, incorporated by reference to Exhibit
10.12 of WellPoint California's Form 10-K for the fiscal
year ended December 31, 1992
10.10 Office Space Lease for Calabasas, CA offices, dated August
26, 1992, between BCC and Lost Hills Office Partners,
First Amendment to Office Lease between Lost Hills Office
Partners and BCC, dated November 1, 1992, and
Subordination, Non-Disturbance and Attornment Agreement,
dated January 7, 1993, between BCC and DAG Management,
incorporated by reference to Exhibit 10.13 of WellPoint
California's Form 10-K for the fiscal year ended December
31, 1992
10.11 WellPoint Health Networks Inc. Officer Change in Control
Plan, incorporated by reference to Exhibit 10.14 of
WellPoint California's Form 10-K for the fiscal year ended
December 31, 1993
10.12 Supplemental Pension Plan of Blue Cross of California,
incorporated by reference to Exhibit 10.15 of WellPoint
California's Form 10-K for the fiscal year ended December
31, 1992
10.13 Blue Cross of California Deferred Compensation Plan,
incorporated by reference to Exhibit 10.13 of WellPoint
California's Form S-1 Registration Statement No. 33-54898
10.14 Form of Supplemental Life and Disability Insurance Policy,
incorporated by reference to Exhibit 10.14 of WellPoint
California's Form S-1 Registration Statement No. 33-54898
10.15 Special Executive Retirement Plan dated as of March 29,
1993, among BCC, WellPoint California and Leonard D.
Schaeffer, incorporated by reference to Exhibit 10.19 of
WellPoint California's Form 10-K for the fiscal year ended
December 31, 1992
10.16 Form of Indemnification Agreement between WellPoint
California and its Directors and Officers, incorporated by
reference to Exhibit 10.17 of WellPoint California's Form
S-1 Registration Statement No. 33-54898
10.17 Officer Severance Agreement, dated as of July 1, 1993,
between WellPoint California and Thomas C. Geiser,
incorporated by reference to Exhibit 10.24 of WellPoint
California's Form 10-K for the fiscal year ended December
31, 1993
10.18 First Amendment to Special Executive Retirement Plan dated
as of March 29, 1993, among BCC, WellPoint California and
Leonard D. Schaeffer (Exhibit 10.19), effective January 1,
1993, incorporated by reference to Exhibit 10.25 of
WellPoint California's Form 10-K for the fiscal year ended
December 31, 1993
10.19 Executive Benefiting You Highlights Brochure, incorporated
by reference to Exhibit 10.29 of Registrant's Form 10-K
for the fiscal year ended December 31, 1993
10.20 WellPoint Health Networks Inc. Officer Change in Control
Plan as amended January 5, 1995, incorporated by reference
to Exhibit 10.33 of WellPoint California's Form 10-K for
the fiscal year ended December 31, 1994
A-2.
<PAGE> 11
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
10.21 Form of Officer Severance Agreement of WellPoint
California, incorporated by reference to Exhibit 10.32 of
WellPoint California's Form 10-K for the fiscal year ended
December 31, 1994
10.22 WellPoint Health Networks Inc. Management Retention
Agreement between WellPoint California and Ronald A.
Williams, amended and restated effective as of January 5,
1995, incorporated by reference to Exhibit 10.35 of
WellPoint California's Form 10-K for the fiscal year ended
December 31, 1994
10.23 WellPoint Health Networks Inc. Management Retention
Agreement between WellPoint California and D. Mark
Weinberg, amended and restated effective as of January 5,
1995, incorporated by reference to Exhibit 10.36 of
WellPoint California's Form 10-K for the fiscal year ended
December 31, 1994
10.24 Amendment to Administrative Services and Product Marketing
Agreement dated as of February 1, 1993, among WellPoint
California, its subsidiaries and BCC (Exhibit 10.02),
amended as of January 1, 1995, incorporated by reference
to Exhibit 10.39 of WellPoint California's Form 10-K for
the fiscal year ended December 31, 1994
10.25 Amendment to Administrative Services and Product Marketing
Agreement dated as of February 1, 1993, among WellPoint
California, its subsidiaries and BCC (Exhibit 10.02),
amended as of February 1, 1995, incorporated by reference
to Exhibit 10.40 of WellPoint California's Form 10-K for
the fiscal year ended December 31, 1994
10.26 Agreement of Purchase and Sale and Escrow Instructions,
dated as of December 16, 1994, between WellPoint
California and Pardee Construction Company, incorporated
by reference to Exhibit 10.41 of WellPoint California's
Form 10-K for the fiscal year ended December 31, 1994
10.27 Credit Agreement, dated as of October 19, 1994, among
WellPoint California, Bank of America, National Trust and
Savings Association, Chemical Bank and Other Financial
Institutions, incorporated by reference to Exhibit 10.43
of WellPoint California's Form 10-K for the fiscal year
ended December 31, 1994
10.28 First Amendment to Credit Agreement, dated as of March 7,
1995, among WellPoint California, Bank of America National
Trust and Savings Association, and other Financial
Institutions, incorporated by reference to Exhibit 10.44
of WellPoint California's Form 10-K for the fiscal year
ended December 31, 1994
10.29 Orders Approving Notice of Material Modification and
Undertakings dated September 7, 1995, by BCC, WellPoint
California and WellPoint California's subsidiaries to the
California Department of Corporations, incorporated by
reference to Exhibit 10.47 of WellPoint California's Form
10-Q for the quarter ended September 30, 1995
10.30 Second Amendment to Credit Agreement, dated as of October
16, 1995, among WellPoint California, Bank of America
National Trust and Savings Associations and other
Financial Institutions, incorporated by reference to
Exhibit 10.48 of WellPoint California's Form 10-Q for the
quarter ended September 30, 1995
10.31 WellPoint Health Networks Inc. Stock Option/Award Plan as
amended January 15, 1997, incorporated by reference to
Exhibit D of WellPoint California's Definitive Proxy
Statement on Schedule 14A dated May 9, 1997.
A-3.
<PAGE> 12
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
10.32 Letter, dated November 13, 1995, from WellPoint California
to Ronald A. Williams regarding severance benefits,
together with underlying Officer Severance Agreement,
incorporated by reference to Exhibit 10.47 of WellPoint
California's Form 10-K for the fiscal year ended December
31, 1995
10.33 Lease Agreement, dated as of January 1, 1996, by and
between TA/Warner Center Associates II, L.P., and
WellPoint California, incorporated by reference to Exhibit
10.46 of WellPoint California's Form 10-K for the fiscal
year ended December 31, 1995
10.34 Letter, dated November 13, 1995, from WellPoint California
to D. Mark Weinberg regarding severance benefits, together
with underlying Officer Severance Agreement, incorporated
by reference to Exhibit 10.48 of WellPoint California's
Form 10-K for the fiscal year ended December 31, 1995
10.35 Letter, dated November 13, 1995, from WellPoint California
to Thomas C. Geiser regarding severance benefits,
incorporated by reference to Exhibit 10.49 of WellPoint
California's Form 10-K for the fiscal year ended December
31, 1995
10.36 Amended and Restated Undertakings dated March 5, 1996, by
BCC, WellPoint California and WellPoint California's
Subsidiaries to the California Department of Corporations,
incorporated by reference to Exhibit 99.1 of WellPoint
California's Current Report on Form 8-K dated March 5,
1996
10.37 Senior Series A Term Note dated March 31, 1996, between
WellPoint California and Massachusetts Mutual Life
Insurance Company, incorporated by reference to Exhibit
10.53 of WellPoint California's Form 10-Q for the quarter
ended March 31, 1996
10.38 Voting Agreement dated as of May 8, 1996, by and among
WellPoint California and Western Health Partnerships,
incorporated by reference to Exhibit 99.3 of WellPoint
California's Form 8-K dated May 20, 1996
10.39 Share Escrow Agent Agreement dated as of May 20, 1996, by
and between WellPoint California and U.S. Trust Company of
California, N.A., incorporated by reference to Exhibit
99.4 of WellPoint California's Form 8-K dated May 20, 1996
10.40 Registration Rights Agreement dated as of May 20, 1996, by
and between WellPoint California and Western Health
Partnerships, incorporated by reference to Exhibit 99.5 of
WellPoint California's Form 8-K dated May 20, 1996
10.41 Blue Cross License Agreement effective as of May 20, 1996,
by and among the Blue Cross and Blue Shield Association
and WellPoint California (supersedes Exhibit 10.09),
incorporated by reference to Exhibit 99.6 of WellPoint
California's Form 8-K dated May 20, 1996
10.42 California Blue Cross License Addendum effective as of May
20, 1996, by and between the Blue Cross and Blue Shield
Association and WellPoint California, incorporated by
reference to Exhibit 99.7 of WellPoint California's Form
8-K dated May 20, 1996
10.43 Blue Cross Affiliated License Agreement effective as of
May 20, 1996, by and between the Blue Cross and Blue
Shield Association and CaliforniaCare Health Plans,
incorporated by reference to Exhibit 99.8 of WellPoint
California's Form 8-K dated May 20, 1996
A-4.
<PAGE> 13
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
10.44 Indemnification Agreement dated as of May 17, 1996, by and
among WellPoint California, WellPoint Health Networks
Inc., a Delaware corporation, and Western Health
Partnerships, incorporated by reference to Exhibit 99.9 of
WellPoint California's Form 8-K dated May 20, 1996
10.45 Credit Agreement dated as of May 15, 1996, by and among
WellPoint California, Bank of America National Trust and
Savings Association ("Bank of America"), as Administrative
Agent, NationsBank of Texas, N.A., as Syndication Agent,
Chemical Bank, as Documentation Agent, and the other
financial institutions named therein, incorporated by
reference to Exhibit 99.10 of WellPoint California's Form
8-K dated May 20, 1996
10.46 WellPoint Health Networks Inc. Employee Stock Option Plan,
incorporated by reference to WellPoint California's
Registration Statement on Form S-8 (Registration No.
33-05111)
10.47 WellPoint Health Networks Inc. Employee Stock Purchase
Plan, incorporated by reference to WellPoint California's
Registration Statement on Form S-8 (Registration No.
333-05111)
10.48 Amendment No. 1 dated as of June 28, 1996, to WellPoint
California's Credit Agreement dated as of May 15, 1996,
incorporated by reference to Exhibit 10.65 of WellPoint
California's Form 10-Q for the quarter ended September 30,
1996
10.49 Subordinated Term Loan Agreement dated as of November 21,
1996, by and among WellPoint California, Bank of America
and the other parties named therein, incorporated by
reference to Exhibit 99.1 to WellPoint California's
Current Report on Form 8-K filed December 12, 1996
10.50 Employment Agreement dated as of January 22, 1997, by and
between WellPoint California and Leonard D. Schaeffer
incorporated by reference to Exhibit 10.50 of WellPoint
California's Annual Report on Form 10-K for the fiscal
year ended December 31, 1996
10.51 Modification Agreement dated as of November 26, 1996 by
and between WellPoint California and California HealthCare
Foundation incorporated by reference to Exhibit 10.51 of
WellPoint California's Annual Report on Form 10-K for the
fiscal year ended December 31, 1996
10.52 Coinsurance Agreement dated as of March 1, 1997 between
John Hancock and UNICARE Life & Health Insurance Company
("UNICARE"), incorporated by reference to Exhibit 99.2 of
WellPoint California's Current Report on Form 8-K filed
March 14, 1997
10.53 Administration Agreement dated as of March 1, 1997 between
John Hancock and UNICARE, incorporated by reference to
Exhibit 99.3 of WellPoint California's Current Report on
Form 8-K filed March 14, 1997
10.54 Amendment No. 1 dated as of February 11, 1997 to WellPoint
California's Subordinated Term Loan Agreement dated as of
November 21, 1996 incorporated by reference to Exhibit
10.54 of WellPoint California's Annual Report on Form 10-K
for the fiscal year ended December 31, 1996
10.55 Blue Cross Affiliate License Agreement by and between BC
Life & Health Insurance Company and the BCBSA incorporated
by reference to Exhibit 10.55 of WellPoint California's
Annual Report on Form 10-K for the fiscal year ended
December 31, 1996
A-5.
<PAGE> 14
EXHIBIT NUMBER DESCRIPTION
-------------- -----------
10.56 Blue Cross Controlled Affiliate License Agreement
Applicable to Life Insurance Companies by and between BC
Life & Health Insurance Company and the BCBSA incorporated
by reference to Exhibit 10.56 of WellPoint California's
Annual Report on Form 10-K for the fiscal year ended
December 31, 1996
10.57 Second Amendment dated as of April 21, 1997 to WellPoint
California's Credit Agreement dated as of May 15, 1996
incorporated by reference to Exhibit 10.55 of WellPoint
California's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1997.
10.58 Third Amendment dated as of April 21, 1997 to WellPoint
California's Credit Agreement dated as of May 15, 1996
incorporated by reference to Exhibit 10.56 of WellPoint
California's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1997.
10.59 Second Amendment dated as of April 21, 1997 to WellPoint
California's Subordinated Term Loan Agreement dated as of
November 21, 1996 incorporated by reference to Exhibit
10.57 of WellPoint California's Quarterly Report on Form
10-Q for the quarter ended March 31, 1997.
10.60 WellPoint Health Networks Inc.'s Employee Stock Purchase
Plan as amended and restated effective January 1, 1988.
10.61 Form of Amended and Restated Voting Agreement by and among
WellPoint California, WellPoint Delaware and the Foundation
10.62 Form of Amended and Restated Registration Rights Agreement
by and among WellPoint California, WellPoint Delaware and
the Foundation
10.63 Form of Amended and Restated Share Escrow Agent Agreement
by and among WellPoint Delaware and U.S. Trust Company of
California
21 Subsidiaries of WellPoint Health Networks Inc. filed as
Exhibit 21 to WellPoint Health Networks Inc.'s Annual
Report on Form 10-K for the fiscal year ended December 31,
1996, and incorporated by reference herein.
A-6.
<PAGE> 1
Exhibit 4.4
Specimen Stock Certificate of WellPoint Delaware
<PAGE> 2
SPECIMEN STOCK CERTIFICATE OF REGISTRANT
The face of the stock certificate has a border which is a continuous intricate
design all the way around. The upper left and right corners contain a different
irregular shaped wavy round design. In the center at the top is a decorative
arch. Below the decorative arch is the company name in logo fashion. Below the
company logo in the center of the certificate is a light red rectangle in which
the words This certifies that is the record holder of, appear in black ink and
the word SPECIMEN appears stamped in darker red ink. The word SPECIMEN is also
stamped in red ink within the border at the bottom on either side of the
corporate seal. The border, upper left and right corners and the decorative
arch are all in red ink, the company logo is in blue and red ink, and the rest
of the text is in black ink.
The following is the text which appears in black on the face of the stock
certificate starting in the upper lefthand corner and moving left to right and
down:
Temporary certificate -- Exchangeable for Definitive Engraved Certificate When
Ready for Delivery Common Stock Common Stock Incorporated Under the Laws of the
State of Delaware This certificate is transferable in the cities of Los
Angeles, Ridgefield Park or New York See reverse for statements relating to
rights, preferences, privileges and restrictions, if any CUSIP 94973H 10 8 This
certifies that Specimen (stamped in red ink) is the record holder of Fully paid
and nonassessable shares of the common stock, $.01 par value, of WellPoint
Health Networks Inc. transferable on the books of the corporation by the
holder hereof in person or by duly authorized attorney upon surrender of this
certificate properly endorsed. This certificate is not valid until
countersigned and registered by the Transfer Agent and Registrar. WITNESS the
facsimile seal of the Corporation and the facsimile signatures of its duly
authorized officers. Dated: Thomas C. Geiser Leonard Schaeffer Secretary
Chairman.
The following text appears in black on the face of the stock certificate in the
lower right corner within the border:
Countersigned and Registered: ChaseMellon Shareholder Services, Transfer Agent
and Registrar by Authorized Signature
The following is the text in black ink which appears on the reverse of the
stock certificate starting in the upper lefthand corner and moving left to
right and down:
A statement of the rights, preferences, privileges and restrictions granted to
or imposed upon the respective classes or series of shares and upon the holders
thereof as established, from time to time, by the Restated Certificate of
Incorporation of the Corporation and by any certificate of determination, and
the number of shares constituting each class and series and the designations
thereof, may be obtained by the holder hereof upon written request and without
charge from the Secretary of the Corporation at its corporate headquarters.
<PAGE> 3
The shares of stock represented by this certificate are subject to restrictions
on ownership and transfer. No Person shall Beneficially Own shares of Capital
Stock in excess of the Ownership Limit (as defined in Article VII, Section 14
of the Restated Certificate of Incorporation of the Corporation). Subject to
certain limited specific exemptions, Beneficial Ownership of 5% or more of the
outstanding shares of any class of Capital Stock will exceed the Ownership
Limit. These provisions have been designed to ensure that the Corporation will
not violate the terms of the License Agreement between the Corporation and the
Blue Cross and Blue Shield Association (the "BCBSA"). The Corporation
maintains at its principal executive office a copy of the applicable
requirements of the BCBSA relating to such restrictions on ownership and
transfer, as such requirements may be amended from time to time, which are open
to inspection by the stockholders, at all reasonable times during office hours.
Any Person who attempts to beneficially own shares in violation of this
limitation must immediately notify the Corporation. All capitalized terms in
this legend have the meanings ascribed to them in the Corporation's Restated
Certificate of Incorporation, as the same may be amended from time to time, a
copy of which, including the restrictions on ownership and transfer, will be
sent without charge to each stockholder who so requests. Upon the occurrence
of any event that would cause any Person to exceed the Ownership Limit
(including without limitation the expiration of a voting trust that entitled
such Person to an exemption from the Ownership Limit), all shares of Capital
Stock Beneficially Owned by such Person in excess of the Ownership Limit will
automatically be deemed Excess Shares and be transferred immediately to the
Share Escrow Agent and be subject to the provisions of the Corporation's
Restated Certificate of Incorporation and the Share Escrow Agent Agreement, a
copy of which the Corporation maintains at its principal executive office. The
foregoing summary of the restrictions on ownership and transfer is qualified in
its entirety by reference to the Corporation's Restated Certificate of
Incorporation. The foregoing abbreviations, when used in the inscription on
the face of this certificate, shall be construed as though they were written
out in full according to applicable laws or regulations: TEN COM -- as tenants
in common UNIF GIFT MIN ACT -- ... Custodian ... TEN ENT -- as tenants by the
entireties (cust) (minor) JT TEN -- as joint tenants with right of survivorship
and not as tenants in common under Uniform Gifts to Minors Act ... (state) UNIF
TRF MIN ACT -- ... Custodian (until age ...) ... under Uniform Transfers
(minor) to Minors Act ... (state) Additional abbreviations may also be used
though not in the above list.
FOR VALUE RECEIVED, ________________________ hereby sell, assign and transfer
unto Please Insert Social Security or other Identifying Number of Assignee
(rectangular box)
________________________ (please print or typewrite name and address, including
zip code, of assignee)
____________________________________ Shares of the capital stock represented by
the within Certificate, and do hereby irrevocably constitute and appoint
____________________________ Attorney to transfer the said stock on the books
of the within named Corporation with full power of substitution in the
premises. Dated ________________ X ________________________ X
________________________ Notice: The signature(s) to this assignment must
correspond with the name(s) as written upon the face
<PAGE> 4
of the certificate in every particular, without alteration or enlargement or
any change whatever. Signature(s) Guaranteed By ______________________
The signature(s) should be guaranteed by an eligible guarantor institution
(Banks, Stockbrokers, Savings and Loan Associations and Credit Unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17ad-15.
<PAGE> 1
Exhibit 9.02
Form of Amended and Restated Voting Trust Agreement
by and among California HealthCare Foundation and Wilmington Trust Company
<PAGE> 2
AMENDED AND RESTATED
VOTING TRUST AGREEMENT
This Amended and Restated Voting Trust Agreement ("Agreement") is made
and entered into as of the ____ day of June, 1997, by and between the
California HealthCare Foundation (formerly Western Health Partnerships, the
"Beneficiary") and Wilmington Trust Company, a Delaware corporation, as trustee
(hereinafter, with any successor trustee, referred to as "Trustee").
WITNESSETH:
WHEREAS, pursuant to an Agreement and Plan of Reorganization dated
June _____, 1997 (the "Reorganization Agreement") among WellPoint Health
Networks Inc., a Delaware corporation (the "Company" or "WellPoint Delaware"),
WellPoint Health Networks Inc., a California corporation, and WLP Acquisition
Corp., a wholly owned subsidiary of WellPoint Delaware ("Merger Sub"), Merger
Sub was merged into WellPoint California, the capital stock of WellPoint
California was converted into capital stock of WellPoint Delaware and the
stockholders of WellPoint California became stockholders of WellPoint Delaware
and the outstanding stock of Merger Sub was converted into stock of WellPoint
California and thereby WellPoint California became a wholly owned subsidiary of
WellPoint Delaware (the "Reorganization");
WHEREAS, as a result of the Reorganization, the parties hereto desire
to enter into this Agreement which amends and restates the Voting Trust
Agreement dated May 20, 1996 by and between the Beneficiary and Wilmington
Trust Company (the "Voting Trust Agreement") and sets forth the terms of the
voting trust established by this Agreement (the "Voting Trust");
WHEREAS, as of the date hereof, the Foundation, pursuant to the
Reorganization, owns approximately 43.0% of the outstanding equity securities
of the Company, representing approximately 43.0% of the voting power of the
outstanding stock of the Company;
WHEREAS, the Beneficiary wishes for its investment in the Company to
be as valuable as possible so long as such investment is maintained and
believes that the Company's primary license to use the "Blue Cross" name and
related rights (the "Blue Cross marks") contributes substantially to the
Company's value and its future prospects;
WHEREAS, the Blue Cross and Blue Shield Association ("BCBSA") has
conditioned the Company's license to continue to use the Blue Cross marks upon
the Company maintaining certain Basic Protections (as defined in the License
Addendum between the Company and BCBSA) which are intended by the BCBSA to
enable the Company to remain independent of the Beneficiary and any other
stockholder who may in the future acquire Capital Stock (as defined below) in
the Company in excess of the Ownership Limit (as defined below); and
1.
<PAGE> 3
WHEREAS, the Beneficiary has agreed to be bound by:
(i) a requirement that the Beneficiary make such
deposits into the voting trust established by this Agreement
(the "Voting Trust") as may be necessary to maintain the shares
of Capital Stock Beneficially Owned (as defined below) by the
Beneficiary outside the Voting Trust at a level which does not
exceed 50% of the voting power of the Company's outstanding
Capital Stock at all times from May 20, 1996 to but not
including May 20, 1999;
(ii) a requirement that the Beneficiary make such
additional deposits into the Voting Trust as may be necessary
to maintain the number of shares of Capital Stock Beneficially
Owned by the Beneficiary outside the Voting Trust at a level
which does not exceed 20% of the voting power of the Company's
outstanding Capital Stock from time to time from and including
May 20, 1999 to but not including May 20, 2001; and
(iii) a requirement that the Beneficiary make such
additional deposits into the Voting Trust as may be necessary
to prevent the Beneficiary from having Beneficial Ownership
outside the Voting Trust of any shares of Capital Stock in
excess of the Ownership Limit at any time on or after May 20,
2001.
The requirements for contributions into this Voting Trust described in
(i), (ii) and (iii) above of the preceding recital are herein called the
"Contributions Timetable."
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants hereinafter set forth and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
hereby agree that the Voting Trust Agreement shall be amended and restated as
of the Effective Date as follows:
1. DEPOSIT OF STOCK AND ISSUANCE OF VOTING TRUST CERTIFICATES.
1.1 DELIVERY OF STOCK CERTIFICATES. The Beneficiary shall make
such contributions of VA Shares (as defined below) which the Beneficiary may
Beneficially Own such that the number of shares Beneficially Owned by the
Beneficiary outside of the Voting Trust shall never exceed the number permitted
by the Contributions Timetable. Every certificate delivered by the Beneficiary
to the Trustee shall be duly endorsed for transfer or accompanied by duly
executed instruments of transfer sufficient to convey to the Trustee record
ownership of such shares and the power to vote such shares specified in this
Agreement. The Beneficiary shall pay any taxes and costs imposed upon such
transfers to the Trustee. Immediately upon each receipt of
2.
<PAGE> 4
certificates pursuant to this paragraph, the Trustee shall cause the
certificates to be surrendered to the Company's transfer agent and canceled and
new certificates therefor to be issued to the Trustee.
1.2 DELIVERY OF VOTING TRUST CERTIFICATE. The Trustee shall issue
and deliver one or more Voting Trust Certificates, in the form attached as
Exhibit "A" hereto (a "Certificate"), to the Beneficiary in respect of the
shares deposited with and held by the Trustee for the benefit of the
Beneficiary under this Agreement. The Trustee shall sign these certificate(s).
1.3 CERTIFICATE BOOK AND INSPECTION OF AGREEMENT. The Trustee
shall keep at 1100 North Market Street, Wilmington, Delaware 19890-001 correct
books of account of all the Trustee's business and transactions relating to the
Voting Trust, and a book (the "Certificate Book") setting forth the number of
shares represented by the Certificate(s) held by the Beneficiary, and the date
of issuance of such Certificate(s). A duplicate of this Agreement and any
extension thereof shall be filed with the secretary of the Company and shall be
open to inspection by a stockholder, a holder of a Certificate or the agent of
either, upon the same terms as the record of stockholders of the Company is
open to inspection.
1.4 LOST CERTIFICATE. If a Certificate shall be lost, stolen,
mutilated or destroyed, the Trustee, in its discretion, may issue a duplicate
of such Certificate upon receipt of evidence of such fact satisfactory to the
Trustee, indemnity satisfactory to it, and the existing Certificate, if
mutilated.
1.5 WITHDRAWAL OF SHARES FROM TRUST. The Beneficiary shall be
entitled at any time to withdraw shares from the Voting Trust: (i) to the
extent that after giving effect to such withdrawal, the Beneficiary would not
Beneficially Own shares outside the Voting Trust in excess of the number
required for the Beneficiary to be in compliance with the Contributions
Timetable or (ii) to enable the Beneficiary to sell, assign, or transfer its
entire Beneficial Ownership interest in each of the shares withdrawn promptly
after such withdrawal. Any share withdrawn in accordance with (i) or (ii)
above shall cease upon withdrawal to be subject to the terms and conditions
hereof.
1.6 PLEDGE, ENCUMBER OR GRANT OPTIONS. The Beneficiary shall be
entitled at any time to pledge, encumber or grant any option in any shares
subject to the Voting Trust hereunder, provided that such shares remain subject
to the provisions of this Agreement, so long as the Beneficiary or any
affiliate of the Beneficiary shall retain any interest therein.
2. TRUSTEE'S POWERS AND DUTIES.
2.1 LIMITS ON TRUSTEE'S POWERS. The Trustee shall have only the
powers set forth in this Agreement. It is expressly understood and agreed by
the parties hereto that under no circumstances shall the Trustee be personally
liable for the payment of any indebtedness or expenses of this Agreement except
as set forth in Section 5.2 of this Agreement, or be liable for the breach or
failure of any obligation, representation, warranty or covenant made or
undertaken by the Trustee under this Agreement or the other related agreement
or document, except as set forth in Section 5.6 of this Agreement.
3.
<PAGE> 5
2.2 EXECUTION BY TRUSTEE. The Trustee shall execute all documents
as follows:
By: Wilmington Trust Company, not in its individual
capacity, but solely as Trustee
By: ___________________________________
2.3 VOTING. With respect to all shares held in the Voting Trust,
the Beneficiary shall retain the entire economic and beneficial ownership
rights therein, including without limitation the right to receive dividends and
distributions on the shares and the right to direct the Trustee in any order
whatsoever to sell, assign, transfer, encumber or grant any option therein to
or in favor of any person other than the Beneficiary or an affiliate of the
Beneficiary or agree to do any such thing, except that the Trustee shall have
the exclusive and absolute right in respect of such shares to vote, assent or
consent such shares at all times during the term of this Agreement, including
without limitation the right to vote at any election of directors and in favor
of or in opposition to any resolution, any dissolution, liquidation, merger or
consolidation of the Company, any sale of all or substantially all of the
Company's assets, any issuance or authorization of securities, or any action of
any character whatsoever which may be presented at any meeting or require the
consent of stockholders of the Company. In exercising the Trustee's powers and
duties hereunder, the Trustee shall at all times vote, assent or consent in
respect of any action as follows, subject to the following paragraph: (i) if
the matter concerned is the election of directors, then the Trustee shall vote,
assent or consent the whole number of shares held by the Voting Trust in favor
of each nominee to the Board of Directors of the Company who has been nominated
by the Nominating Committee, the remaining BCC Designees, or the remaining
WellPoint Designees pursuant to Article IV, Section 2 of the bylaws of the
Company in effect as of the effective time of the Reorganization (the "Bylaws")
or any successor provision thereto, and, with respect to every Board position
for which no nominee is presented in accordance with the preceding provisions
in this clause (i), shall vote for the nominee selected by a majority of the
incumbent members of the Board of Directors of the Company and vote against any
candidate for the Board of Directors of the Company for whom no competing
candidate has been nominated in one of the methods prescribed in this clause
(i); (ii) where the matter under state law or the Restated Certificate of
Incorporation or the Bylaws requires at least an absolute majority of all
outstanding shares of common stock of the Company in order to be effected, then
the Trustee shall vote, assent or consent all of such shares in favor of or in
opposition to such matter as the majority of all Nontrust Votes (as defined
below) are cast; and (iii) on all other matters, the Trustee shall at all times
vote, assent or consent all of such shares in the identical proportions in
favor of or in opposition to such matters as Nontrust Votes are cast. If any
calculation of votes under the preceding sentence would require a fractional
vote, the Trustee shall vote the next lower number of whole shares.
With respect to (i), (ii) and (iii), the Trustee, unless such action
is initiated by or with the consent of the Board of Directors of the Company,
shall (a) vote against removal of any director of the Company, except in the
case of fraudulent or dishonest acts or gross abuse of authority or discretion
with reference to the Company (which acts or gross abuse shall have been
determined by a majority of those holders of Nontrust Votes entitled to vote at
a duly
4.
<PAGE> 6
held meeting of the stockholders of the Company at which a quorum is present),
(b) vote against adoption of new bylaws or certificate of incorporation of the
Company or any alteration, amendment, change or addition to or repeal of the
Bylaws or Restated Certificate of Incorporation, (c) not nominate any candidate
to fill any vacancy on the Board of Directors of the Company, (d) not call any
special meeting of the stockholders of the Company, and (e) not take any action
by voting shares held by the Voting Trust that would be inconsistent with or
would have the effect, directly or indirectly, of defeating or subverting the
board nomination procedures identified in clause (i) above. Before voting,
assenting or consenting, the Trustee shall at all times be entitled to receive
(x) any proxy or other written materials identifying any action on which the
Trustee's vote, assent or consent is requested and whether or not any action is
initiated by or with the consent of the Board of Directors of the Company and
(y) a certificate of the Secretary or other authorized officer of the Company
tabulating any votes cast at a meeting before the Trustee shall have voted and
identifying the number and percentage of votes cast by Nontrust Votes. The
Trustee shall use all reasonable commercial efforts to ensure, with respect to
the shares held in the Voting Trust hereunder, that such shares are counted as
being present for the purposes of any quorum required for stockholder action of
the Company and to vote, assent or consent as set forth above so long as the
Trustee has reasonable notice of the time to vote, assent or consent. For
purposes of this Agreement, Nontrust Votes shall mean the votes cast by
stockholders other than the Trust.
2.4 SALES. The Trustee shall have no authority to sell or
otherwise dispose of or to pledge, encumber or hypothecate, any of the stock
deposited pursuant to the provisions of this Agreement, unless directed to do
so by the Beneficiary. The Beneficiary shall have the right to direct the
Trustee to sell or otherwise dispose of or to pledge, encumber or hypothecate
all or any part of the shares held by the Voting Trust.
3. DIVIDENDS AND DISTRIBUTIONS.
3.1 CASH. The Beneficiary shall be entitled to receive payments
equal to the amount of cash dividends, if any, collected or received by the
Trustee or its successor upon the number of shares in respect of which any
Certificate was issued, subject to deduction in respect of expenses, charges or
fees pursuant to Section 5.2 or 5.3 below. The Trustee shall arrange with the
Company for the direct payment by the Company of such cash dividends to the
Beneficiary.
3.2 STOCK. In case the Trustee shall receive, as a dividend or
other distribution upon any shares of stock held by the Trustee under this
Agreement, any shares of stock of the Company, the Trustee shall hold the same
and said shares shall be subject to all of the terms and conditions of this
Agreement to the same extent as if originally deposited hereunder. The Trustee
shall issue Certificate(s) in respect of such additional shares to the
Beneficiary.
3.3 OTHER DISTRIBUTIONS. If at any time during the continuation
of this Agreement the Trustee shall receive or collect any monies through a
distribution by the Company to its stockholders, other than in payment of cash
dividends, or shall receive any property (other than shares of stock or
securities convertible into voting stock of the Company) through a distribution
by the Company to its stockholders, the Trustee shall distribute the same to
the
5.
<PAGE> 7
Beneficiary, subject to deduction in respect of expenses, charges or fees
pursuant to Section 5.2 or 5.3 below.
4. RIGHTS TO SUBSCRIBE.
In case any securities of the Company shall be offered for
subscription to the holders of stock held by the Trustee under this Agreement,
the Trustee, promptly upon receipt of notice of such offer, shall mail a copy
thereof to the Beneficiary. Upon receipt by the Trustee, two (2) days (or any
shorter time if this is feasible) prior to the last date fixed by the Company
for subscription, of a request from the Beneficiary of any Certificate to
subscribe in its behalf, accompanied by the sum of money (in immediately
available funds) required to be paid for such securities, the Trustee shall
make such subscription and payment on behalf of the Beneficiary, and upon
receiving from the Company the certificates for the securities so subscribed
for, the Trustee shall deliver the same to the Beneficiary, unless such
securities be voting stock or securities convertible into voting stock, in
which case the Trustee shall issue to the Beneficiary a Certificate in respect
thereof, and such securities shall be held by the Trustee for the benefit of
the Beneficiary subject to the terms of this Agreement.
5. THE TRUSTEE.
5.1 USE OF PROXIES. The Trustee may vote, assent or consent with
respect to all shares held in the Voting Trust in person or by such person or
persons as it may from time to time select as its proxy provided that the
Trustee shall at all times do so in conformity with the provisions of Section
2.3 hereof.
5.2 EXPENSES. The Trustee is expressly authorized to incur and
pay such reasonable expenses and charges, to employ and pay such agents,
attorneys and counsel, and to incur and pay such other charges and expenses as
the Trustee may deem reasonably necessary and proper for administering this
Agreement. The Beneficiary agrees to reimburse the Trustee for any such
expenses and charges, and any such expenses or charges may be deducted from the
cash dividends or other monies received by the Trustee on the shares deposited
hereunder, to the extent unreimbursed.
5.3 COMPENSATION. The Trustee shall be entitled to a fee for its
services as Trustee hereunder as provided in a separate fee agreement between
the parties hereto and such fee may be deducted from the cash dividends or
monies received by Trustee on the shares deposited hereunder, to the extent
otherwise unpaid by the Beneficiary.
5.4 SUCCESSOR TRUSTEE. The Trustee may resign after giving thirty
(30) days' advance written notice of its resignation to the Beneficiary. The
Beneficiary may in addition terminate the Trustee after giving thirty (30)
days' advance written notice thereof to the Trustee provided that such
termination of the Trustee shall not become effective until a Successor Trustee
(as defined below) becomes bound by this Agreement. If the Trustee shall
resign or be so terminated by the Beneficiary, the Trustee shall be replaced by
a reasonably competent alternate (who is an institution duly authorized to act
as such a trustee in the State of Delaware) (the "Successor Trustee"). The
Successor Trustee shall be designated by the
6.
<PAGE> 8
Trustee and approved by the Beneficiary. The Beneficiary shall not
unreasonably withhold its approval of any qualified Successor Trustee. The
Successor Trustee shall enjoy all the rights, powers, interests and immunities
of the Trustee originally designated and shall agree in writing to be bound by
this Agreement.
5.5 INTERESTS OF TRUSTEE. The Trustee and any firm, corporation,
trust or association of which it may be a member, trustee, stockholder, agent
or affiliate may contract with the Company or any affiliate and may be or
become pecuniarily interested in any matter to which the Company or any
affiliate may be a party or in which it may be concerned, as fully and freely
as though the Trustee were not the Trustee hereunder. Directors and officers
of the Trustee may act as directors and/or officers of the Company or any
affiliate.
5.6 TRUSTEE'S LIABILITY. The Trustee shall not be liable for any
act or omission undertaken in connection with its powers and duties under this
Agreement, except for any willful misconduct or gross negligence by Trustee.
No Successor Trustee shall be liable for actions or omissions of the Trustee or
any other Successor Trustee. The Trustee shall not be liable in acting on any
notice, request, consent, certificate, instruction, or other paper or document
or signature reasonably believed to be genuine and to have been signed by the
proper party. The Trustee may consult with legal counsel (reasonably competent
for the purpose) and any act or omission undertaken by it in good faith in
accordance with the opinion of such legal counsel shall not result in any
liability of the Trustee. The Beneficiary covenants and agrees to indemnify
and hold harmless the Trustee and its affiliates, directors, officers,
employees, agents and advisors (each an "Indemnified Party"), without
duplication, from and against any and all claims, damages, losses, liability,
obligations, actions, suits, costs, disbursements and expenses (including
without limitation reasonable fees and expenses of counsel) incurred by any
Indemnified Party, in any way relating to or arising out of or in connection
with or by reason of the preparation for a defense of any investigation,
litigation or proceeding arising out of this Agreement or the shares of the
Beneficiary held pursuant to this Agreement, the administration of this
Agreement or the action or inaction of the Trustee hereunder; except to the
extent such claim, damage, loss, liability, obligation, action, suit, cost,
disbursement or expense results from such Indemnified Parties' gross negligence
or willful misconduct. The indemnity set forth in this Section 5.6 shall be in
addition to any other obligation or liabilities of the Beneficiary hereunder or
at common law or otherwise and shall survive the termination of this Agreement.
Notwithstanding anything contained herein to the contrary, the Trustee
shall not be required to take any action in any jurisdiction other than in the
State of Delaware if the taking of such action will (i) require the consent or
approval or authorization or order of or the giving of notice to, or the
registration with or the taking of any action in respect of, any state or other
governmental authority or agency of any jurisdiction other than the State of
Delaware; (ii) result in any fee, tax or other governmental charge under the
laws of any jurisdiction or any political subdivisions thereof in existence on
the date hereof other than the State of Delaware becoming payable by the
Trustee; or (iii) subject the Trustee to personal jurisdiction in any
jurisdiction other than the State of Delaware for causes of action arising from
acts unrelated to the consummation of the transactions by the Trustee
contemplated hereby.
7.
<PAGE> 9
6. TERMINATION.
6.1 TERM. This Agreement shall terminate upon written notice by
the Beneficiary to the Trustee of such termination (a) if the Company no longer
licenses the Blue Cross marks from BCBSA, (b) if and to the extent that all of
the shares held in the Voting Trust have been sold, assigned, transferred or
withdrawn pursuant to Section 2.4 or Section 1.5, or (c) if the Beneficiary and
its affiliates cease to Beneficially Own Capital Stock in excess of the
Ownership Limit. Except as otherwise provided herein, the trust created by
this Agreement is hereby expressly declared to be and shall be irrevocable.
6.2 DELIVERY OF SHARE CERTIFICATE(S). As soon as practicable
after the termination of this Agreement, the Trustee shall deliver to the
Beneficiary, certificate(s) representing the number of shares beneficially
owned by the Beneficiary at the date of termination, upon the surrender of such
Certificate(s) properly endorsed and upon payment by the Beneficiary of any and
all taxes and other expenses relating to the transfer or delivery of such
certificates.
7. MISCELLANEOUS.
7.1 MERGER. If the Company shall merge into or consolidate with
another corporation or corporations, or if all or substantially all of the
assets of the Company are transferred to another corporation, the shares of
which are issued to stockholders of the Company in connection with such
transfer, then the terms "WellPoint Health Networks Inc." or the "Company"
shall be construed, so long as the "Blue Cross" name and mark continues to be
licensed by such entity from BCBSA, to include such successor corporation and
the Trustee shall receive and hold under this Agreement any shares of such
successor corporation received by it on account of its ownership as Trustee of
shares held by it hereunder prior to such merger, consolidation or transfer.
Certificates issued and outstanding at the time of such merger, consolidation
or transfer may remain outstanding, but the Trustee may, in its discretion,
substitute new Certificates in appropriate form.
7.2 SUCCESSORS. This Agreement shall bind and inure to the
benefit of the Trustee and each and all of its respective heirs, executors,
administrators, successors and assigns. Notwithstanding any provision of this
Agreement, the provisions of this Agreement shall not be binding on any offeree
or purchaser from the Beneficiary (other than such a person who is an affiliate
of the Beneficiary and except that any and all shares sold in violation of
paragraph 12 of that certain Amended and Restated Registration Rights Agreement
dated as of June ____, 1997 between the Company and the Beneficiary shall
remain subject to this Agreement). In case at any time the Trustee shall
resign and no successor Trustee shall have been appointed within thirty days
after notice of such resignation has been filed and mailed as required by
Section 7.3, the resigning Trustee may forthwith apply to a court of competent
8.
<PAGE> 10
jurisdiction for the appointment of a successor Trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and appropriate,
appoint a successor Trustee.
7.3 NOTICES. All notices and other communications given or made
pursuant hereto shall be in writing and shall be deemed to have been duly given
or made as of the date delivered or mailed if delivered personally or mailed by
registered or certified mail (postage prepaid, return receipt requested) to the
parties at the following addresses (or at such other address for a party as
shall be specified by like changes of address which shall be effective upon
receipt) or sent by electronic transmission, with confirmation received, to the
telecopy number specified below:
(a) If to the Beneficiary:
California HealthCare Foundation
496 Ninth Street
Oakland, California 94607
Telecopier No.: (510) 238-1388
Attention: Vice President and Secretary
With a copy to:
Munger, Tolles & Olson LLP
355 South Grand Avenue, Suite 3500
Los Angeles, CA 90071-1560
Telecopier No.: (213) 687-3702
Attention: Ruth E. Fisher, Esq.
Marron, Reid & Sheehy LLP
601 California Street, Suite 1200
San Francisco, California 94108-2896
Telecopier No.: (415) 986-1374
Attention: E. Lewis Reid, Esq.
(b) If to the Trustee:
Wilmington Trust Company
1100 North Market Street
Wilmington, Delaware 19890-0001
Telecopier No.: (302) 651-8882
Attention: Corporate Trust Administration
9.
<PAGE> 11
With a copy to:
Richards, Layton & Finger P.A.
One Rodney Square
Post Office Box 551
Wilmington, Delaware 19899
Telecopier No.: (302) 658-6548
Attention: Glenn C. Kenton, Esq.
7.4 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, without
reference to conflicts of laws principles.
7.5 ATTORNEYS' FEES. In the event of any suit or other proceeding
between the parties hereto with respect to any of the transactions contemplated
hereby or the subject matter hereof, the prevailing party shall, in addition to
such other relief as the court may award, be entitled to recover reasonable
attorneys' fees, expenses and costs of investigation, all as actually incurred,
including, without limitation, attorneys' fees, costs and expenses of
investigation incurred in appellate proceedings or in any action or
participation in, or in connection with, any case or proceeding under Chapters
7, 11 and 13 of the Bankruptcy Code or any successor thereto.
7.6 FAIR CONSTRUCTION. This Agreement is the product of
negotiation and shall be deemed to have been drafted by all of the parties. It
shall be construed in accordance with the fair meaning of its terms and its
language shall not be strictly construed against, nor shall ambiguities be
resolved against, any particular party.
7.7 ENTIRE AGREEMENT. This Agreement contains the entire
agreement between the parties hereto regarding the subject matter hereof, and
may not be amended, altered or modified except by a writing signed by the
parties hereto and consented to by the Company. This Agreement supersedes all
prior agreements, representations, warranties, statements, promises,
information, arrangements and understandings, whether oral or written, express
or implied, with respect to the subject matter hereof, all of which are
specifically integrated into this Agreement. No party hereto shall be bound by
or charged with any oral or written agreements, representations, warranties,
statements, promises, information, arrangements or understandings, express or
implied, not specifically set forth herein; and the parties hereto further
acknowledge and agree that in entering into this Agreement they have not in any
way relied and will not rely in any way on any of the foregoing not
specifically set forth herein.
7.8 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
10.
<PAGE> 12
7.9 CERTAIN DEFINITIONS. For purposes of this Agreement, the
term:
(a) "Beneficially Own" has the meaning set forth in
Section 14 of Article VII of the Company's Restated Certificate of
Incorporation.
(b) "Capital Stock" has the meaning set forth in Section
14 of Article VII of the Company's Restated Certificate of Incorporation.
(c) "Ownership Limit" has the meaning set forth in
Section 14 of Article VII of the Company's Restated Certificate of
Incorporation, but without disregarding any shares Beneficially Owned by the
Beneficiary.
(d) "VA Shares" means all of the shares of the Company's
Capital Stock Beneficially Owned by the Health Foundation at any particular
time, except that (i) shares of Capital Stock which are held in the Voting
Trust and are voted as required by the terms of this Agreement shall not be
deemed VA Shares so long as they are so held in the Voting Trust and voted and
(ii) the Health Foundation shall be entitled to Beneficially Own at any
particular time shares of Capital Stock of the Company representing up to the
Ownership Limit free of and without being subject in any way to either this
Agreement or the Voting Agreement and none of the shares of Capital Stock
Beneficially Owned by the Health Foundation at or below the Ownership Limit
shall be deemed VA Shares. Without limiting by implication the generality of
the preceding sentence, any share of Capital Stock which shall be Beneficially
Owned by the Health Foundation at any particular time in excess of the
Ownership Limit shall be deemed a VA Share, unless at that particular time it
is on deposit in the Voting Trust and is required to be voted in accordance
with the terms of this Agreement.
IN WITNESS WHEREOF, the Trustee and the Beneficiary have executed this
Agreement on the day and year first above written.
WILMINGTON TRUST COMPANY CALIFORNIA HEALTHCARE FOUNDATION
By: By:
--------------------------- -----------------------------
Its: Its:
-------------------------- ----------------------------
11.
<PAGE> 13
EXHIBIT A
[COMPANY NAME]
VOTING TRUST CERTIFICATE
CERTIFICATE NO. __________________ _________ SHARES
This certifies that the undersigned trustee (the "Trustee") holds
________ shares of common stock ("Shares") of [the recapitalized entity to be
known as WellPoint Health Networks Inc.] (the "Company") beneficially owned by
Western Health Partnerships (the "Beneficiary") subject to the terms and
conditions of a Voting Trust Agreement ("Agreement") dated as of
______________, 1996, between the Beneficiary and Trustee. This certificate is
Exhibit A to the Agreement, a copy of which is on file with the secretary of
the Company in Woodland Hills, California.
1. During the term of the Agreement, Trustee has the exclusive
and absolute right to vote the Shares as provided in the Agreement.
2. During the term of the Agreement, the Beneficiary shall be
subject to the terms and conditions of the Agreement and entitled to the
benefits of the Beneficiary under the Agreement.
3. As soon as practicable after the termination of the Agreement
and subject to its terms and conditions, the Trustee shall deliver to the
Beneficiary share certificates representing the number of shares of stock of
the Company beneficially owned by the Beneficiary at the date of termination of
the Agreement, upon the surrender of this certificate properly endorsed and
upon payment by the Beneficiary of any and all taxes and other expenses
relating to the transfer or delivery of share certificates to the Beneficiary
pursuant to the termination of the Agreement.
Dated as of ______________, 19___.
Wilmington Trust Company, not in its individual
capacity, but solely as Trustee
By:
-------------------------------------------
Its:
-------------------------------------------
12.
<PAGE> 1
Exhibit 10.60
WellPoint Health Networks Inc.'s Employee Stock Purchase Plan
as Amended and Restated Effective January 1, 1998
<PAGE> 2
WELLPOINT HEALTH NETWORKS INC.
1996 EMPLOYEE STOCK PURCHASE PLAN
(AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 1998)
1. Purpose
The WellPoint Health Networks Inc. Employee Stock Purchase Plan (the
"Plan") is intended to provide an opportunity to participate in the ownership
of Wellpoint Health Networks, Inc. (the "Company") for eligible employees of
the Company and such other companies ("Participating Companies") as the Board
of Directors of the Company (the "Board") or the Committee (as defined below)
shall from time to time designate; provided that each such company shall
qualify as a "parent corporation" or "subsidiary corporation" (a "Corporate
Affiliate"), as defined in Section 425(e) and (f) of the Internal Revenue Code
of 1986 (the "Code"), on the first day of the relevant Offering Period. It is
further intended that the Plan shall qualify as an "employee stock purchase
plan" as defined in Section 423 of the Code. The terms of this amendment and
restatement of the Plan shall be effective for Offering Periods beginning on
and after January 1, 1998.
2. Administration
(a) Administrative Body. The Plan shall be administered by a
committee or committees (the "Committee") appointed by the Board. The
Committee shall have full authority to interpret and construe any provision of
the Plan and to adopt such rules and regulations for administering the Plan as
it may deem necessary. Decisions of the Committee shall be final and binding
on all parties who have an interest in the Plan.
(b) Rule 16b-3 Limitations. Notwithstanding the provisions of
Subsection 2(a), in the event that Rule 16b-3 promulgated under the Securities
Exchange Act of 1934, as amended, or any successor provision ("Rule 16b-3")
provides specific requirements for the administrators of plans of this type,
the Plan shall be only administered by such a body and in such a manner as
shall comply with the applicable requirements of Rule 16b-3. Unless permitted
by Rule 16b-3, no discretion concerning decisions regarding the Plan shall be
afforded to any committee or person that is not "disinterested" as that term is
used in Rule 16b-3.
3. Effective Date and Term of Plan
(a) Effective Date. Subject to 3(b), the Plan shall become
effective on May 21, 1996.
(b) Escrow Shares. Pending such further approval of the Plan by
the Company's stockholders as the Committee shall deem advisable, all shares
issued under the Plan shall be
1.
<PAGE> 3
nontransferable and shall be held in escrow by the Company. If the Company's
stockholders approve the Plan within one year of the date of adoption of the
Plan by the Board, the escrowed shares will thereafter be subject to the
conditions described in Section 7(g) of the Plan. If the stockholders do not
approve the Plan within such one year period, such shares shall be cancelled
and the Company shall refund to participants the amount of payroll deductions
collected with interest thereon at the rate equal to the rate for one-year
Treasury bills immediately before the first day of the first Offering Period.
(c) Termination of Plan. The Plan shall continue in effect until
the date on which all shares available for issuance under the Plan shall have
been issued unless earlier terminated pursuant to Section 9 or 10.
4. Stock Subject to the Plan
(a) Number of Shares. The stock subject to the Plan shall be
shares of the common stock of the Company which are authorized but unissued or
which have been reacquired (the "Common Stock"). In connection with the sale
of shares under the Plan, the Company may repurchase shares of Common Stock in
the open market. The aggregate amount of Common Stock which may be issued
pursuant to the Plan shall not exceed 400,000 shares (subject to further
adjustment thereafter as provided in 4(b)).
(b) Adjustment. If any change is made in the Common Stock subject
to the Plan, or subject to any purchase right granted under the Plan (through
merger, consolidation, reorganization, recapitalization, stock dividend,
split-up, combination of shares, exchange of shares, change in corporate
structure, or otherwise), the Committee shall make appropriate adjustments as
to (i) the class and maximum number of shares subject to the Plan, (ii) the
class and maximum number of shares purchasable by each participant per Offering
Period, and (iii) the class and number of shares and price per share of stock
subject to outstanding purchase rights in order to prevent the dilution or
enlargement of benefits thereunder.
(c) Corporate Affiliate Stock. Subject to such limits, regulatory
approvals and stockholder approvals as the Committee determines to be
necessary, Common Stock issuable under the Plan may include the stock of a
Corporate Affiliate.
5. Offering Periods
(a) Terms of Offering Period. Common Stock shall be offered for
purchase under the Plan through a series of successive Offering Periods until
such time as (i) the maximum number of shares of Common Stock available for
issuance under the Plan shall have been issued pursuant to purchase rights
granted under the Plan or (ii) the Plan shall have been sooner terminated in
accordance with Article 9 or 10. The Committee shall determine, in its
discretion, the length of each Offering Period and may provide for more than
one "Purchase Period" within each Offering Period, in which case the purchase
right for such Offering Period shall be exercised in successive installments on
the last business day of each Purchase Period within the Offering Period, but
no more frequently than quarterly. No Offering Period shall have a term
exceeding 27 months.
2.
<PAGE> 4
(b) Initial Offering Periods. The initial Offering Period under
the Plan will begin on such date as the Board or Committee shall specify and
end on December 31, 1996. Unless the Committee otherwise determines,
subsequent Offering Periods will begin on the first business day, and end on
the last business day, of each calendar year that begins thereafter.
(c) Purchase Rights. Each participant shall be granted a separate
purchase right for each Offering Period in which the individual participates.
The purchase right shall be granted on the first day of such Offering Period
and shall be automatically exercised on the last day of the Offering Period or
in installments on the last day of each separate Purchase Period authorized
within such Offering Period.
6. Eligibility and Participation
(a) General Rules. Each employee of the Company or any of the
Participating Companies shall be an eligible employee, provided that an
employee whose terms of employment are subject to the terms of a collective
bargaining agreement shall not be an eligible employee if and for such period
of time as the union representing a collective bargaining unit of which any
employee is a member chooses, on behalf of the members of such unit, not to
participate in the Plan. An employee may participate in an Offering Period if
the employee (i) has become an eligible employee before the first day of the
Offering Period, (ii) has completed any minimum service requirement that may be
specified by the Committee for such Offering Period (or in the case of an
employee whose terms of employment are subject to the terms of a collective
bargaining agreement, any probationary period specified therein for
participation in the Plan), not to exceed two years, and (iii) remains an
eligible employee on the first day of the Offering Period. Eligible employees
may become participants with respect to an Offering Period by executing such
instruments as the Committee may specify and delivering them to such persons
and at such time prior to the first day of that Offering Period as the
Committee may specify.
(b) Five Percent Owner. Under no circumstances shall purchase
rights be granted under the Plan to any employee if such individual would,
immediately after the grant, own (within the meaning of Code Section 424(d)),
or hold outstanding options or other rights to purchase, stock possessing five
percent (5%) or more of the total combined voting power or value of all classes
of stock of the Company or any Corporate Affiliate.
7. Purchase Rights
Purchase rights shall be evidenced by instruments in such form as the
Committee may from time to time approve, and shall conform to the following
terms and conditions:
(a) Purchase Price. The Purchase Price per share of each share
purchased on any date within an Offering Period shall be the lower of (i) a
percentage specified by the Committee (but not less than eighty-five percent
(85%)) of the fair market value per share of the Company's Common Stock on the
first day of the Offering Period, or (ii) a percentage specified by the
Committee (but not less than eighty-five percent (85%)) of the fair market
value per share of the Company's Common Stock on the purchase date.
3.
<PAGE> 5
(b) Fair Market Value. For purposes of the Plan, the fair market
value per share of the Company's Common Stock on any day shall be the closing
price on that date as recorded by the Wall Street Journal in the New York Stock
Exchange Composite Transactions, or on the next regular business date on which
shares of the Common Stock are traded in the event that no shares of the Common
Stock have been traded on the relevant day. If such exchange shall cease to be
the primary exchange or market for the Company's Common Stock, fair market
value shall be determined based on the closing price (or, if not available, the
mean between the high and low selling or bid and asked prices) as reported for
the exchange or market that the Committee determines to be the primary market
for such Common Stock.
(c) Payroll Deductions. Payment for Common Stock under the Plan
shall be effected by means of the participant's authorized payroll deductions
or such other means as the Committee may authorize. Such deductions shall
begin with the first pay day following the commencement of the Offering Period
and shall (unless sooner terminated by the participant) remain in effect for
successive Offering Periods. The Committee may permit participants to elect
payroll deductions pursuant to one or either of the following methods:
(i) Flat Dollar Amount. A participant may elect
a flat dollar amount per biweekly payroll check, to be
contributed to the Plan. The minimum contribution is $20 per
payroll check. The maximum contribution is $21,250 per year.
A participant may also make a separate election to contribute
to the Plan a specified dollar amount from annual scheduled
bonus payments made in the month of March.
(ii) Percentage of Compensation. A participant may
elect a percentage of the participant's compensation paid
during the Offering Period, in one percent (1%) increments
(not to exceed fifteen percent (15%)), to be contributed to
the Plan. Compensation for this purpose means the
participant's total compensation, which includes regular base
earnings paid by a Participating Company, sales commissions,
overtime, bonuses and incentive payments, and elective
contributions that are not includible in income under Sections
125, 402(a)(8), 401(h) or 403(b) of the Code.
(d) Number of Shares. On the first day of any Offering Period, a
participant shall be granted a purchase right to purchase up to a fixed number
of shares of Common Stock determined as of such date by dividing the total
amount anticipated to be collected pursuant to Section 7(c), together with any
amount carried over from the preceding Offering Period, by one hundred percent
(100%) of the fair market value of the Company's Common Stock on the first day
of the Offering Period and multiplying the result by a constant number, not to
exceed one and one-half (1-1/2), specified by the Committee for such Offering
Period. Any payroll deductions not applied to such purchase because they are
not sufficient to purchase a whole share shall be held for the purchase of
Common Stock on the next purchase date.
(e) Termination of or Changes to Payroll Deductions. Unless a
participant has irrevocably elected otherwise, the participant may terminate
payroll deductions at any time by
4.
<PAGE> 6
filing the appropriate form with the Committee. Such termination will become
effective on the first day of the first full payroll period following the
filing of such form. Any payroll deductions previously collected from the
participant and not previously applied to the purchase of Common Stock during
that Offering Period shall, at the participant's election, immediately be
refunded or held for the purchase of shares on the next purchase date
immediately following such termination. If no such election is made, then such
funds shall be refunded as soon as possible after the purchase date. Prior to
the commencement of any new Offering Period, a participant may resume, increase
or decrease payroll deductions by filing the appropriate form with the
Committee. The new payroll deduction shall become effective on the first day
of the first Offering Period following the filing of such form. Distribution
of Common Stock held in a participant's account shall be distributed pursuant
to Section 7(g).
(f) Termination of Employment. If a participant ceases to be
employed by the Company or a Participating Company for any reason, including
death or disability, prior to the end of an Offering Period, the participant's
purchase right shall terminate, and any payroll deductions previously collected
from the participant and not previously applied to the purchase of Common Stock
during that Offering Period shall immediately be paid to the participant or the
participant's personal representative. The Committee may provide, on a uniform
basis with respect to any Offering Period, that an employee who is on a leave
of absence will be deemed to have terminated employment after a specified
period.
(g) Transfer Restrictions on Shares.
(i) Restrictions and Escrow. The Committee may determine, in
its discretion, that shares of Common Stock acquired under the Plan during an
Offering Period shall not be transferable by the participant, other than by
reason of death or such other reasons as the Committee may specify, for a
period not to exceed one (1) year following the purchase date. If the
Committee does so determine, shares so acquired shall be held in escrow by the
Company until such transfer restrictions lapse. The Committee may also provide
with respect to any Offering Period, that in the event that a participant
attempts to transfer shares held in escrow on his or her behalf or terminates
employment with the Company or Participating Company while shares are held in
escrow on his or her behalf, the Company shall have an automatic right to
repurchase, unless such repurchase is prohibited or restricted by law, such
shares, for an amount equal to the lesser of (i) the price paid for the shares
by the participant, or (ii) the fair market value (determined in accordance
with Section 7(b)) of the shares on the date of repurchase.
(ii) Additional Shares and Dividends. In the event of any
stock dividend, stock split, recapitalization, reorganization or other change
in corporate structure effected without receipt of consideration, then any new,
substituted or additional securities or other property (including money paid
other than as a regular cash dividend) which is by reason of such transaction
distributed with respect to any escrowed shares shall be reinvested in shares
of Common Stock under the Plan, and shares purchased pursuant to such
reinvestment shall be immediately subject to the above transfer and escrow
provisions to the same extent the previously escrowed shares are at the time.
All regular cash dividends on shares or other securities at the
5.
<PAGE> 7
time held on behalf of a participant shall be reinvested in shares of Common
Stock under the Plan.
(h) Proration of Purchase Rights. If the total number of shares
of Common Stock for which purchase rights are to be granted on any date in
accordance with the terms of the Plan exceed the number of shares then
remaining available under the Plan (after deduction of all shares for which
purchase rights have been exercised or are then outstanding), the Committee
shall make a pro rata allocation of the shares remaining available in as near
as uniform a manner as shall be practicable and as it shall deem equitable.
The Committee shall give written notice of such allocation to each participant
affected thereby.
(i) Exercise. Each purchase right shall be exercised
automatically on the purchase date for the full number of purchasable shares,
unless the purchase right has been previously terminated pursuant to Section
7(e) or 7(f).
(j) Assignability. Subject to Section 8, purchase rights under
the Plan shall not be assignable or transferable by the participant other than
by will or by the laws of descent and distribution and during the life of the
participant shall be exercisable only by the participant.
(k) Rights as Stockholder. A participant shall have no rights as
a stockholder with respect to shares covered by any purchase right granted
under the Plan until the purchase right is exercised. No adjustments will be
made for dividends or other rights for which the record date is prior to the
date of exercise.
(l) Accrual Limitations. No purchase right shall permit the
rights of a participant to purchase stock under all "employee stock purchase
plans" (as defined in Section 423 of the Code) of the Company or a Corporate
Affiliate to accrue at a rate that exceeds $25,000 of fair market value of such
stock (determined at the time such purchase right is granted) for each calendar
year in which such purchase right is outstanding at any time.
(m) Regulatory Approval. The implementation of the Plan, the
granting of any purchase right under the Plan, and the issuance of Common Stock
upon the exercise of any such purchase right shall be subject to the Company's
compliance with all applicable requirements of the Securities Act of 1933, all
applicable listing requirements of any securities exchange on which the Common
Stock is listed and all other applicable requirements established by law or
regulation.
(n) Other Provisions. Instruments evidencing purchase rights may
contain such other provisions, not inconsistent with the Plan, as the Committee
deems advisable.
8. Designation of Beneficiary
A participant may file a written designation of a beneficiary who is
to receive shares and cash, if any, credited on behalf of the participant under
the Plan in the event of such participant's death. Such designation of
beneficiary may be changed by the participant at any time by filing
6.
<PAGE> 8
the appropriate form with the Committee. In the event of the death of a
participant and in the absence of a beneficiary validly designated under the
Plan who is living at the time of such participant's death, the Company shall
deliver such shares and/or cash to the executor or administrator of the estate
of the participant, or if no such executor or administrator has been appointed
(to the knowledge of the Company), the Company shall deliver such shares and/or
cash to the participant's spouse or if no spouse is living, to the children of
the participant in equal shares.
9. Corporate Transactions
(a) Termination. In the event of the disposition of all or
substantially all of the assets or outstanding capital stock of the issuer of
the Common Stock by means of a sale, merger, reorganization, or liquidation (a
"Corporate Transaction"), each purchase right under this Plan, unless assumed
pursuant to a written agreement by the successor corporation or a parent or
subsidiary thereof, will automatically be exercised immediately prior to the
consummation of the Corporate Transaction as if such date were the last
purchase date of the Offering Period. Any payroll deductions not applied to
such purchase shall be promptly refunded to the participant.
(b) Corporate Structure. The grant of purchase rights under this
Plan will in no way affect the right of the issuer of Common Stock to adjust,
reclassify, reorganize, or otherwise change its capital or business structure
or to merge, consolidate, dissolve, liquidate or sell or transfer all or any
part of its business or assets.
10. Amendment and Termination
(a) Amendment. The Board may from time to time alter, amend,
suspend, or discontinue the Plan with respect to any shares at any time not
subject to purchase rights; provided, however, that no such action of the Board
may, without the approval of stockholders of the Company, (i) increase the
number of shares subject to the Plan (unless necessary to effect the
adjustments required under Section 4(b)), or (ii) make any other change with
respect to which the Board determines that stockholder approval is required by
applicable law or regulatory standards.
(b) Termination. The Board shall have the right, exercisable in
its sole discretion, to terminate the Plan immediately following any purchase
date. Should the Board elect to exercise such right, then no further purchase
rights shall thereafter be granted or exercised, and no further payroll
deductions shall thereafter be collected under the Plan.
11. No Employment Obligation
Nothing contained in the Plan (or in any purchase right granted
pursuant to the Plan) shall confer upon any employee any right to continue in
the employ of the Company or any Corporate Affiliate or constitute any contract
or agreement of employment or interfere in any way with the right of the
Company or a Corporate Affiliate to reduce such employee's compensation from
the rate in existence at the time of the granting of a purchase right or to
terminate such employee's employment at any time, with or without cause.
However, nothing contained herein or in any
7.
<PAGE> 9
purchase right shall affect any contractual rights of an employee pursuant to a
written employment agreement.
12. Governing Law
To the extent not otherwise governed by federal law, the Plan and its
implementation shall be governed by and construed in accordance with the laws
of the State of California.
8.
<PAGE> 1
Exhibit 10.61
Form of Amended and Restated Voting Agreement
by and among WellPoint California, WellPoint Delaware and
California HealthCare Foundation
<PAGE> 2
AMENDED AND RESTATED
VOTING AGREEMENT
THIS AMENDED AND RESTATED VOTING AGREEMENT ("Agreement") is
made and entered into this ____ day of June 1997, by and among WellPoint Health
Networks Inc., a California corporation (formerly Blue Cross of California,
"WellPoint California"), WellPoint Health Networks Inc., a Delaware corporation
(the "Company" or "WellPoint Delaware"), and California Healthcare Foundation, a
California nonprofit public benefit corporation (formerly Western Health
Partnerships, the "Health Foundation").
WHEREAS, pursuant to an Agreement and Plan of Reorganization
dated June ___, 1997 (the "Reorganization Agreement") among WellPoint Delaware,
WellPoint California and WLP Acquisition Corp., a wholly owned subsidiary of
WellPoint Delaware ("Merger Sub"), Merger Sub was merged into WellPoint
California, the capital stock of WellPoint California was converted into
capital stock of WellPoint Delaware and the shareholders of WellPoint
California became stockholders of WellPoint Delaware and the outstanding stock
of Merger Sub was converted into stock of WellPoint California and thereby
WellPoint California became a wholly owned subsidiary of WellPoint Delaware
(the "Reorganization");
WHEREAS, WellPoint California and the Health Foundation
entered into a Voting Agreement dated May 8, 1996 (the "Voting Agreement") and,
as a result of the Reorganization, each of WellPoint California and the Health
Foundation desire to amend the Voting Agreement to, among other things, have
the Company assume the rights and obligations of WellPoint California under the
Voting Agreement;
WHEREAS, the Company desires to become a party to this
Agreement with the same rights and obligations as WellPoint California has
under the Voting Agreement;
WHEREAS, as of the date of this Agreement, the Health
Foundation beneficially owns an aggregate of 29,910,000 shares of the Company's
Common Stock;
WHEREAS, the Health Foundation wishes for its investment in
the Company to be as valuable as possible so long as such investment is
maintained and believes that the Company's primary license to use the "Blue
Cross" name and related rights (the "Blue Cross marks") contributes
substantially to the Company's value and its future prospects;
WHEREAS, the Blue Cross and Blue Shield Association ("BCBSA")
has conditioned the Company's license to continue to use the Blue Cross marks
upon the Company maintaining certain Basic Protections (as defined in the
License Addendum between the Company and BCBSA) which are intended by the BCBSA
to enable the Company to remain independent of the Health Foundation and any
other stockholder who may in the future acquire Capital Stock (as defined
below) in the Company in excess of the Ownership Limit (as defined below); and
1.
<PAGE> 3
WHEREAS, the conditions imposed by the License Addendum
include a requirement that the Health Foundation vote all VA Shares (as defined
below) as provided herein and certain other matters with respect to the
Company's Common Stock.
NOW, THEREFORE, in consideration of the foregoing, and the
representations, warranties, covenants and agreements contained herein, and
intending to be legally bound, the parties hereto agree that the Voting
Agreement is hereby amended and restated to add the Company as a party hereto,
that WellPoint Delaware shall assume the rights and obligations of WellPoint
California under the Voting Agreement, that WellPoint California is relieved of
any further obligations under the Voting Agreement and that the parties further
agree as follows:
1. VOTING AGREEMENT. During the Initial Period, the
Health Foundation agrees, with respect to all VA Shares: (A) to vote in favor
of each nominee to the Board of Directors of the Company who has been nominated
by the Nominating Committee, the remaining BCC Designees, or the remaining
WellPoint Designees pursuant to Article IV, Section 2 of the bylaws of the
Company in effect as of the date of this Agreement (the "Bylaws") or any
successor provision thereto, and, with respect to every Board position for
which no nominee is presented in accordance with the preceding provisions in
this clause (A), to vote for the nominee selected by a majority of the
incumbent members of the Board of Directors of the Company and vote against any
candidate for the Board of Directors of the Company for whom no competing
candidate has been nominated in one of the methods prescribed in this clause
(A); and (B) unless such action is initiated by or with the consent of the
Board of Directors of the Company, (i) to vote against removal of any director
of the Company, except in the case of fraudulent or dishonest acts or gross
abuse of authority or discretion with reference to the Company as determined by
the Health Foundation, (ii) to vote against adoption of new bylaws or articles
of incorporation of the Company or any alteration, amendment, change or
addition to or repeal of the Bylaws or Restated Certificate of Incorporation,
(iii) not to nominate any candidate to fill any vacancy on the Board of
Directors of the Company, (iv) not to call any special meeting of the
stockholders of the Company, and (v) to take no action by voting its VA Shares
that would be inconsistent with or would have the effect, directly or
indirectly, of defeating or subverting the board nomination procedures
identified in clause (A) above. For purposes of this Agreement, "Initial
Period" shall mean the period commencing as of the date of this Agreement and
ending upon the date on which the Health Foundation and its affiliates, when
taken together, cease to Beneficially Own Capital Stock in excess of the
Ownership Limit. For purposes of this Agreement, "affiliates" of the Health
Foundation shall be deemed not to include the Company and its subsidiaries.
2. STANDSTILL. During the Initial Period, the Health
Foundation will not, directly or indirectly, (i) individually, or as part of a
group, acquire, offer or propose to acquire, or agree to acquire, by purchase
or otherwise, any shares of the Company's Capital Stock, or direct or indirect
rights or options to acquire (through purchase, exchange, conversion or
otherwise), beneficial ownership of any shares of the Company's Capital Stock
or (ii) enter into any agreement, arrangement or understanding with any person,
other than the Company, that would have the effect of increasing such person's
or the Health Foundation's
2.
<PAGE> 4
voting power in the Company provided that this clause (ii) shall not prohibit
transfers of the Company's Capital Stock by the Health Foundation that,
pursuant to section 6(b) hereof, would otherwise result in such shares no
longer being subject to this Agreement. Notwithstanding the foregoing, it is
expressly agreed that any acquisition of shares of the Company's Capital Stock
by the Health Foundation shall not be deemed to violate or conflict with the
provisions of this Section 2 in the following circumstances: (i) any
acquisition of shares by reason of stock dividends, stock splits, spin-offs,
mergers, recapitalizations, combinations, conversions, exchanges of shares or
the like or (ii) any acquisition of shares at any time after the ownership of
the Company's Capital Stock by the Health Foundation shall have fallen to the
Ownership Limit or less with such acquisition having the effect of increasing
the ownership of the Company's Capital Stock by the Health Foundation within or
up to but not beyond the Ownership Limit.
3. NOMINATING BCC DESIGNEE TO BOARD. During the Initial
Period, so long as the Nominating Committee to the Board of Directors of the
Company shall remain in existence pursuant to the Bylaws, in the case of a
person nominated to be a replacement for any BCC Designee, the Company
undertakes to ensure that any such nomination shall only be made after
reasonable and adequate consultation thereon with the Health Foundation.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE
HEALTH FOUNDATION. The Health Foundation represents, warrants and covenants to
the Company that (i) it is the record or beneficial owner of 26,433,651 VA
Shares, at the effective date of this Agreement; (ii) for so long as the Health
Foundation owns of record or beneficially VA Shares, those VA Shares owned by
the Health Foundation are and at all times prior to the expiration of the
Initial Period will be free and clear of any liens, claims, options, charges or
other encumbrances; (iii) it does not own of record or beneficially any shares
of Capital Stock of the Company in excess of the Ownership Limit, other than
the VA Shares and, if any, the Voting Trust Shares; and (iv) it has full power
and authority to make, enter into and carry out the terms of this Agreement.
Notwithstanding the foregoing, (a) the Health Foundation may pledge any of its
VA Shares as collateral provided that such pledge complies with Section
14(c)(3) of Article VII of the Company's Restated Certificate of Incorporation,
and (b) the Health Foundation shall be free to dispose of any of its VA Shares
in accordance with and subject to any other agreements or restrictions which
may be applicable, and any non-affiliated transferee shall acquire the VA
Shares free and clear of any provisions of this Agreement, except that any and
all VA Shares sold in violation of Section 12 of that certain Amended and
Restated Registration Rights Agreement as of even date herewith among the
Company, WellPoint California and the Health Foundation shall remain subject to
this Agreement. In addition, the Health Foundation agrees that, during the
Initial Period, it will be present, in person or represented by proxy, at all
meetings of the stockholders of the Company for which it has VA Shares, so that
all VA Shares then beneficially owned by the Health Foundation may be counted
for the purpose of determining the presence of a quorum at such meetings.
5. ADDITIONAL DOCUMENTS. The Health Foundation hereby
covenants and agrees to execute and deliver any additional documents necessary
or desirable, in the reasonable opinion of the Company, to carry out the purpose
and intent of this Agreement.
3.
<PAGE> 5
6. MISCELLANEOUS.
a) SEVERABILITY. If any term, provision,
covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, void or unenforceable, then the remainder of the
terms, provisions, covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated.
If any term, provision, covenant or restriction in Section I hereof is held by
a court of competent jurisdiction to be invalid, void or unenforceable, then
such provision shall be construed so as to require the VA Shares to be voted in
the identical proportions in favor of or in opposition to such matters as votes
of stockholders other than the Health Foundation are cast.
b) BINDING EFFECT AND ASSIGNMENT. This
Agreement and all of the provisions hereof shall be binding upon and inure to
the benefit of WellPoint Delaware and the Health Foundation and their
respective successors and permitted assigns, but, except as otherwise
specifically provided herein, neither this Agreement nor any of the rights,
interests or obligations of the parties hereto may be assigned by either of
WellPoint Delaware or the Health Foundation without the prior written consent
of the other. Notwithstanding the foregoing, the provisions of this Agreement
shall not be binding on any transferee who is not affiliated with the Health
Foundation except that any and all VA Shares sold in violation of Section 12 of
that certain Amended and Restated Registration Rights Agreement effective on or
before the effective date hereof among the Company, WellPoint California and
the Health Foundation shall remain subject to this Agreement.
c) AMENDMENTS AND MODIFICATION. This Agreement
may not be modified, amended, altered or supplemented except by the execution
and delivery of a written agreement executed by WellPoint Delaware and the
Health Foundation.
d) SPECIFIC PERFORMANCE; INJUNCTIVE RELIEF. The
parties acknowledge that there will be irreparable harm and that there will be
no adequate remedy at law for a violation of any of the covenants or agreements
set forth herein. Therefore, it is agreed that, in addition to any other
remedies that may be available to any party upon any such violation, the
non-defaulting party shall have the right to enforce such covenants and
agreements by specific performance, injunctive relief or by any other means
available to such party at law or in equity.
e) NOTICES. All notices and other
communications pursuant to this Agreement shall be in writing and deemed to be
sufficient if contained in a written instrument and shall be deemed given if
delivered personally, telecopied, sent by nationally recognized overnight
courier or mailed by registered or certified mail (return receipt requested),
postage prepaid, to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice):
4.
<PAGE> 6
If to the Company, then addressed to the Company at:
21555 Oxnard Street
Woodland Hills, CA 91367
Attn: General Counsel
Telecopy No.: (818) 703-4406
With a copy to:
Brobeck Phleger & Harrison LLP
Spear Street Tower
One Market Street
San Francisco, CA 94105
Attn: William L. Hudson, Esq.
Telecopy No.: (415) 442-1010
If to the Health Foundation:
California HealthCare Foundation
496 Ninth Street
Oakland, CA 94607
Attn: General Counsel
Telecopy No.: (510) 238-1388
With a copy to:
Munger, Tolles & Olson LLP
355 South Grand Avenue, Suite 3500
Los Angeles, CA 90071-1560
Attn.: Ruth E. Fisher, Esq.
Telecopy No.: (213) 687-3702
Marron, Reid & Sheehy LLP
601 California Street, Suite 1200
San Francisco, California 94108-2896
Attn.: E. Lewis Reid, Esq.
Telecopy No.: (415) 986-1374
f) GOVERNING LAW. This Agreement shall be
governed and enforced in accordance with the internal laws of the State of
Delaware without regard to its principles of conflicts of laws.
g) ENTIRE AGREEMENT. This Agreement contains
the entire understanding of the parties in respect of the subject matter
hereof, and supersedes all prior negotiations and understandings, including the
Voting Agreement, between the parties with respect to such subject matter.
5.
<PAGE> 7
h) COUNTERPARTS. This Agreement may be executed
in several counterparts, each of which shall be an original, but all of which
together shall constitute one and the same agreement.
i) EFFECT OF HEADING. The section headings
herein are for convenience only and shall not affect the construction or
interpretation of this Agreement.
j) AUTOMATIC TERMINATION. This Agreement shall
become ineffective and of no further force and effect in the event that (i) the
Company ceases to be subject to any License Agreement (as defined in Section
14(e) of Article VII of the Company's Restated Certificate of Incorporation);
and/or (ii) the Health Foundation and its affiliates cease to Beneficially Own
Capital Stock in excess of the Ownership Limit.
k) LEGENDING OF CERTIFICATES. Each certificate
representing (i) VA Shares, and (ii) any other securities issued in respect of
the VA Shares by reason of stock dividends, stock splits, spin-offs, mergers,
recapitalizations, combinations, conversions, exchanges of shares or the like,
shall bear a legend to the effect that: "The securities represented by this
certificate are subject to an Amended and Restated Voting Agreement (the
"Amended and Restated Voting Agreement") dated June ____, 1997 by and among
WellPoint Health Networks Inc., a Delaware corporation, WellPoint Health
Networks Inc., a California corporation, and California HealthCare Foundation, a
copy of which may be obtained from the Secretary of the Company. The provisions
of the Amended and Restated Voting Agreement are not binding on any transferee
who is not affiliated with the California HealthCare Foundation except that any
and all shares subject to the Amended and Restated Voting Agreement sold in
violation of Section 12 of that certain Amended and Restated Registration Rights
Agreement among WellPoint Health Networks Inc., a Delaware corporation,
WellPoint Health Networks Inc., a California corporation, and California
HealthCare Foundation dated as of even date with the Amended and Restated Voting
Agreement shall remain subject to the Amended and Restated Voting Agreement."
No VA Shares may be held by the Health Foundation or any of its affiliates in
any street or nominee name. All VA Shares shall be represented at all times by
stock certificates which do not represent any shares other than VA Shares and
which are registered in the name of the Health Foundation or its affiliates or
are registered in a way in which they can be readily identified by the Company
and its transfer agents as VA Shares. The Health Foundation shall provide such
information and assistance as the Company may reasonably request at any time to
identify the VA Shares.
l) CERTAIN DEFINITIONS. For purposes of this
Agreement, the term:
a) "Beneficially Own" has the meaning
set forth in Section 14 of Article
VII of the Company's Restated
Certificate of Incorporation;
b) "Capital Stock" has the meaning set
forth in Section 14 of Article VII
of the Company's Restated
Certificate of Incorporation;
6.
<PAGE> 8
c) "Ownership Limit" has the meaning
set forth in Section 14 of Article
VII of the Company's Restated
Certificate of Incorporation, but
without disregarding any shares
Beneficially Owned by the Health
Foundation;
d) "Trustee" means Wilmington Trust
Company or any successor thereto as
trustee pursuant to the Voting Trust
Agreement;
e) "VA Shares" means all shares of the
Company's Capital Stock Beneficially
Owned by the Health Foundation at
any particular time, except that (i)
Voting Trust Shares which are voted
as required by the terms of the
Voting Trust Agreement shall not be
deemed VA Shares so long as they are
so held in the voting trust created
by the Voting Trust Agreement and
voted, and (ii) the Health
Foundation shall be entitled to
Beneficially Own at any particular
time Capital Stock of the Company
representing up to the Ownership
Limit free of and without being
subject in any way to either the
Voting Trust Agreement or this
Agreement and none of the Capital
Stock Beneficially Owned by the
Health Foundation at or below the
Ownership Limit shall be deemed VA
Shares. Without limiting by
implication the generality of the
preceding sentence, any share of
Capital Stock which shall be
Beneficially Owned by the Health
Foundation at any particular time in
excess of the Ownership Limit shall
be deemed a VA Share unless at that
particular time it is on deposit in
the voting trust created by the
Voting Trust Agreement and is
required to be voted in accordance
with the terms of the Voting Trust
Agreement;
f) "Voting Trust Agreement" means that
certain Amended and Restated Voting
Trust Agreement of even date
herewith between the Health
Foundation and the Trustee, or any
replacement agreement thereof; and
g) "Voting Trust Shares" means those
shares of Capital Stock, if any,
held of record by the Trustee
pursuant to the Voting Trust
Agreement.
7.
<PAGE> 9
IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed on the day and year first above written.
WELLPOINT HEALTH NETWORKS INC.,
a California corporation
By:______________________________
Name:____________________________
Title:___________________________
WELLPOINT HEALTH NETWORKS INC.,
a Delaware corporation
By:______________________________
Name:____________________________
Title:___________________________
CALIFORNIA HEALTHCARE FOUNDATION
By:_______________________________
Name:_____________________________
Title:____________________________
8.
<PAGE> 1
Exhibit 10.62
Form of Amended and Restated Registration Rights Agreement
by and among WellPoint California, WellPoint Delaware and
California HealthCare Foundation
<PAGE> 2
AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
THIS AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this
"Agreement"), dated as of June ____, 1997, by and among CALIFORNIA HEALTHCARE
FOUNDATION, a California nonprofit public benefit corporation (formerly Western
Health Partnerships, the "Foundation"), WELLPOINT HEALTH NETWORKS INC., a
Delaware corporation ("WellPoint Delaware") and WELLPOINT HEALTH NETWORKS INC.,
a California corporation (formerly Blue Cross of California, "WellPoint
California").
WHEREAS, pursuant to an Agreement and Plan of Reorganization
dated June ____, 1997 (the "Reorganization Agreement") among WellPoint
Delaware, WellPoint California and WLP Acquisition Corp., a wholly owned
subsidiary of WellPoint Delaware ("Merger Sub"), Merger Sub was merged into
WellPoint California, the capital stock of WellPoint California was converted
into capital stock of WellPoint Delaware and the shareholders of WellPoint
California became stockholders of WellPoint Delaware and the outstanding stock
of Merger Sub was converted into stock of WellPoint California and thereby
WellPoint California became a wholly owned subsidiary of WellPoint Delaware
(the "Reorganization");
WHEREAS, WellPoint California, the Foundation and The
California Endowment (formerly Western Foundation for Health Improvement) and
WellPoint Health Networks Inc., a Delaware corporation ("Old WellPoint"),
entered into an Amended and Restated Recapitalization Agreement dated as of
March 31, 1995 (the "Recapitalization Agreement") pursuant to which WellPoint
California converted from a nonprofit public benefit corporation to for-profit
status and the Foundation became its sole shareholder, and thereafter Old
WellPoint merged into WellPoint California and following that merger the
Foundation became an 80.4% shareholder in WellPoint California, with other
former shareholders of Old WellPoint holding the remaining 19.6% of the
outstanding shares of Common Stock of WellPoint California;
WHEREAS, the Foundation and WellPoint California executed a
Registration Rights Agreement dated May 20, 1996 (the "Registration Rights
Agreement"), as required under the Recapitalization Agreement;
WHEREAS, as a result of the Reorganization, the parties hereto
desire to enter into this Agreement which amends and restates the Registration
Rights Agreement to have WellPoint Delaware assume the rights and obligations
of WellPoint California under the Registration Rights Agreement and sets forth
the terms of certain registration rights applicable to the Registrable
Securities (as defined below); and
<PAGE> 3
WHEREAS, as of the date hereof, the Foundation, pursuant to
the Reorganization, owns 29,910,000 shares of WellPoint Delaware's issued and
outstanding Common Stock, par value $.01 per share ("Common Stock").
NOW, THEREFORE, upon the premises and the mutual promises
herein contained, and for good and valuable consideration, the receipt and
adequacy of which are acknowledged, the parties agree that the Registration
Rights Agreement is hereby amended and restated to add WellPoint Delaware as a
party hereto, that WellPoint Delaware shall assume the rights and obligations
of WellPoint California under the Registration Rights Agreement (with the
exception of Sections 8(a) and 8(d) hereof) and that the parties further agree
as follows:
1. CERTAIN DEFINITIONS. As used in this Agreement, the
following initially capitalized terms shall have the following meanings:
(a) "Affiliate" means, with respect to any
person, any other person who, directly or indirectly, is in control of, is
controlled by or is under common control with the former person.
(b) "Holders" means the Foundation or any
Affiliate of the Foundation or any trustee for the account of the Foundation
and any "transferee" (as such term is defined in Section 11 hereof) which is
the record holder of Registrable Securities.
(c) "Registrable Securities" means the shares of
Common Stock held by the Foundation as of the date hereof, any stock or other
securities into which or for which such shares of Common Stock may hereafter be
changed, converted or exchanged, and any other securities issued to the Holders
of such shares of Common Stock (or such shares into which or for which such
shares are so changed, converted or exchanged) upon any reclassification, share
combination, share subdivision, share dividend, merger, consolidation or
similar transactions or events, provided that any such securities shall cease
to be Registrable Securities if (i) a registration statement with respect to
the sale of such securities shall have become effective under the Securities
Act (as defined below) and such securities shall have been disposed of in
accordance with the plan of distribution set forth in such registration
statement, (ii) such securities shall have been transferred pursuant to Rule
144, (iii) such securities are held by a Holder other than the Foundation,
unless such Holder shall furnish WellPoint Delaware an opinion of counsel,
which opinion shall be reasonably satisfactory to WellPoint Delaware, to the
effect that all of such securities are not permitted to be distributed by such
Holder in one transaction pursuant to Rule 144, or (iv) such securities are
held by a Holder whose aggregate holdings of Registrable Securities, computed
in accordance with the requirements of Section 13(d) of the Securities Exchange
Act of 1934, as amended, and the rules and regulations promulgated thereunder,
constitute less than 4.9% of the total outstanding common equity of WellPoint
Delaware.
(d) "Registration Expenses" means all reasonable
expenses in connection with any registration of securities pursuant to this
Agreement including, without limitation, the following: (i) SEC filing fees;
(ii) the fees, disbursements and expenses of
2.
<PAGE> 4
WellPoint Delaware's counsel(s) and accountants in connection with the
registration of the Registrable Securities to be disposed of under the
Securities Act; (iii) all expenses in connection with the preparation, printing
and filing of the registration statement, any preliminary prospectus or final
prospectus and amendments and supplements thereto and the mailing and
delivering of copies thereof to any Holders, underwriters and dealers and all
expenses incidental to delivery of the Registrable Securities; (iv) the cost of
producing blue sky or legal investment memoranda; (v) all expenses in
connection with the qualification of the Registrable Securities to be disposed
of for offering and sale under state securities laws, including the fees and
disbursements of counsel for the underwriters or Holders in connection with
such qualification and in connection with any blue sky and legal investments
surveys; (vi) the filing fees incident to securing any required review by the
National Association of Securities Dealers, Inc. of the terms of the sale of
the Registrable Securities to be disposed of; (vii) transfer agents',
depositories' and registrars' fees and the fees of any other agent appointed in
connection with such offering; (viii) all security engraving and security
printing expenses; (ix) all fees and expenses payable in connection with the
listing of the Registrable Securities on each securities exchange or
inter-dealer quotation system on which a class of common equity securities of
WellPoint Delaware is then listed; (x) all reasonable out-of-pocket expenses of
WellPoint Delaware incurred in connection with road show presentations,
including the salaries (based on a per diem allocation) and expenses (to the
extent not reimbursed by the underwriters) of officers making road show
presentations and holding meetings with potential investors to facilitate the
distribution and sale of Registrable Securities and other out-of-pocket
expenses of WellPoint Delaware related thereto, but salaries shall be deemed a
Registrable Expense if and only to the extent such road show presentations and
meetings are made or held on more than five business days in the aggregate with
respect to any one registration (and then only if earned or incurred in respect
of such days in excess of five business days); (xi) the prorated salaries and
expenses of in-house attorneys performing legal services to the extent such
services would otherwise be performed by outside counsel; (xii) courier,
overnight delivery, word processing, duplication, telephone and facsimile
expenses; and (xiii) any one-time payment for directors and officers insurance
directly related to such offering, provided the insurer provides a separate
statement for such payment.
(e) "Rule 144" means Rule 144 promulgated under
the Securities Act, or any successor rule to similar effect.
(f) "SEC" means the United States Securities and
Exchange Commission.
(g) "Securities Act" means the Securities Act of
1933, as amended, or any successor statute.
2. DEMAND REGISTRATION.
(a) At any time, upon written notice from a
Holder in the manner set forth in Section 13(h) hereof requesting that
WellPoint Delaware effect the registration under the Securities Act of any or
all of the Registrable Securities held by such Holder, which
3.
<PAGE> 5
notice shall specify the intended method or methods of disposition of such
Registrable Securities, WellPoint Delaware shall have the right, exercisable
within 15 days by written notice, to purchase all or a portion of the
Registrable Securities requested to be registered by such Holder at a cash
price per share equal to the arithmetic mean of each of the closing sales
prices per share of Common Stock on the New York Stock Exchange for each of the
15 consecutive trading days ending on the fifth trading day immediately
preceding the date of the written notice from the Holder under this Section
2(a). The closing of such purchase shall take place no later than 45 days
after the date of the written notice from WellPoint Delaware under this Section
2(a).
(b) If WellPoint Delaware does not exercise its
right to purchase under Section 2(a) above, WellPoint Delaware shall use its
best efforts to effect, in the manner set forth in Section 5, the registration
under the Securities Act of such Registrable Securities for disposition in
accordance with the intended method or methods of disposition stated in such
request, provided that:
(i) if prior to receipt of a
registration request pursuant to this Section 2(b), WellPoint Delaware
had commenced a financing plan through a formal "all hands" meeting
with outside advisors, including an underwriter if such financing plan
is an underwritten offering, and, in the good-faith business judgment
of WellPoint Delaware's underwriter, a registration at the time and on
the terms requested could materially and adversely affect or interfere
with such financing plan of WellPoint Delaware or its subsidiaries (a
"Transaction Blackout"), WellPoint Delaware shall not be required to
effect a registration pursuant to this Section 2(b) until the earliest
of (A) the abandonment of such offering, (B) 90 days after the
termination of such offering, (C) the termination of any "hold back"
period obtained by the underwriter(s) of such offering from any person
in connection therewith or (D) 110 days after receipt by the Holder
requesting registration of the written notice from WellPoint Delaware
referred to above in this subsection (i);
(ii) if, while a registration request is
pending pursuant to this Section 2(b), WellPoint Delaware has
determined in good faith that (A) the filing of a registration
statement could jeopardize or delay any contemplated material
transaction other than a financing plan involving WellPoint Delaware
or would require the disclosure of material information that WellPoint
Delaware had a bona fide business purpose for preserving as
confidential; or (B) WellPoint Delaware then is unable to comply with
SEC requirements applicable to the requested registration
(notwithstanding its best efforts to so comply), WellPoint Delaware
shall not be required to effect a registration pursuant to this
Section 2(b) until the earlier of (1) the date upon which such
contemplated transaction is completed or abandoned or such material
information is otherwise disclosed to the public or ceases to be
material or WellPoint Delaware is able to so comply with applicable
SEC requirements, as the case may be, and (2) 45 days after WellPoint
Delaware makes such good-faith determination, provided that WellPoint
Delaware shall not be permitted to delay a requested registration in
reliance on this clause (ii) more than once in any 12-month period;
and
4.
<PAGE> 6
(iii) WellPoint Delaware shall not be
obligated to file a registration statement relating to a registration
request pursuant to this Section 2: (A) more than once in any calendar
year; (B) within a period of six months after the effective date of
any other registration statement of WellPoint Delaware demanded
pursuant to this Section 2(b); or (C) if such registration request is
for a number of Registrable Securities which have an aggregate market
value less than $75 million. For purposes of this subsection
2(b)(iii), registration statements filed by WellPoint California prior
to the date hereof shall be deemed a registration statement filed by
WellPoint Delaware.
(c) Notwithstanding any other provision of this
Agreement to the contrary:
(i) a registration requested by a Holder
pursuant to this Section 2 shall not be deemed to have been effected
(and, therefore, not requested for purposes of Section 2(b)), (A) if
it is withdrawn based upon material adverse information relating to
WellPoint Delaware that is different from the information (x) known to
the Holder requesting registration at the time of their request for
registration, or (y) promptly disclosed by WellPoint Delaware to the
Holder at the time of their request for registration; (B) if after it
has become effective such registration is interfered with by any stop
order, injunction or other order or requirement of the SEC or other
governmental agency or court for any reason other than a
misrepresentation or an omission by such Holder and, as a result
thereof, less than 90% of the Registrable Securities requested to be
registered can be completely distributed in accordance with the plan
of distribution set forth in the related registration statement; or
(C) if the conditions to closing specified in the purchase agreement
or underwriting agreement entered into in connection with such
registration are not satisfied (other than by reason of some act or
omission by such Holder) or waived by the underwriters;
(ii) a registration requested by a Holder
pursuant to this Section 2 and later withdrawn at the request of such
Holder (other than for any reason set forth in Section 2(c)(i)) shall
be deemed to have been effected (and, therefore, requested for purposes
of Section 2(b)), whether withdrawn by the Holder prior to or after
the effectiveness of such requested registration, provided, that if
the Holder bears the Registration Expenses for any registration begun
pursuant to Section 2(b) and subsequently withdrawn, such registration
shall not count as a requested registration pursuant to Section 2(b).
(d) In the event that any registration pursuant
to this Section 2 shall involve, in whole or in part, an underwritten offering,
WellPoint Delaware, on the one hand, and the Holder initiating the demand
pursuant to Section 2(a), on the other hand, shall each have the right to
designate an underwriter as the sole lead managing underwriters of such
underwritten offering (with such co-lead managing underwriters sharing lead
managing underwriter compensation equally). WellPoint Delaware and such Holder
shall together select which of the co-lead managing underwriters shall serve as
"books-running" underwriter; provided that if WellPoint Delaware and such
Holder cannot, within 10 days following the
5.
<PAGE> 7
notice from such Holder referred to in Section 2(a), reach a mutual agreement
on such selection, then (i) WellPoint Delaware shall have the right in the case
of the first such underwritten offering (subject to the consent of the
Foundation, which consent may not be unreasonably withheld) to select the
"books-running" underwriter for such first offering; (ii) such Holder shall
have the right (in the case of the next such underwritten offering as to which
no agreement can be reached as provided) to select the "books-running"
underwriter for such next offering; and (iii) the selection right shall
thereafter alternate for each subsequent offering as to which no agreement can
be reached as provided.
(e) Holders other than the Holder initiating the
demand pursuant to Section 2(b) shall have the right to include their shares of
Registrable Securities in any registration pursuant to Section 2(b); provided
that the Foundation may exclude participation by other Holders in connection
with registrations pursuant to two demands (no two of which can be in
consecutive years). In connection with those registrations in which multiple
Holders participate, in the event such registration involves an underwritten
offering and the lead managing underwriter advises that marketing factors
require a limitation on the number of shares to be underwritten, the number of
shares to be included in the underwriting and registration shall be allocated
pro rata among the Holders on the basis of the shares of Registrable Securities
held by each such Holder.
(f) WellPoint Delaware shall have the right to
cause the registration of additional securities for sale for the account of any
person (including WellPoint Delaware) in any registration of Registrable
Securities requested by a Holder pursuant to Section 2(b); provided that
WellPoint Delaware shall not have the right to cause the registration of such
additional securities if such Holder is advised in writing (with a copy to
WellPoint Delaware) by the lead managing underwriter designated by the Holder
pursuant to Section 2(d) that, in such firm's good-faith opinion, registration
of such additional securities would materially and adversely affect the
offering and sale of the Registrable Securities then contemplated by such
Holder.
3. PIGGYBACK REGISTRATION. At any time if WellPoint
Delaware proposes to register any of its Common Stock or any other of its
common equity securities (collectively, "Other Securities") under the
Securities Act (other than a registration on Form S-4 or S-8 or any successor
form thereto), whether or not for sale for its own account, in a manner which
would permit registration of Registrable Securities for sale for cash to the
public under the Securities Act, it will each such time give prompt written
notice to each Holder of its intention to do so at least 10 business days prior
to the anticipated filing date of the registration statement relating to such
registration. Such notice shall offer each such Holder the opportunity to
include in such registration statement such number of Registrable Securities as
each such Holder may request. Upon the written request of any such Holder made
within five business days after the receipt of WellPoint Delaware's notice
(which request shall specify the number of Registrable Securities intended to
be disposed of and the intended method of disposition thereof), WellPoint
Delaware shall effect, in the manner set forth in Section 5, in connection with
the registration of the Other Securities, the registration under the Securities
Act of all Registrable Securities which WellPoint Delaware has been so
requested to register, to the extent required to permit the disposition (in
accordance with such
6.
<PAGE> 8
intended methods thereof) of the Registrable Securities so requested to be
registered, provided that:
(a) if at any time after giving written notice of
its intention to register any securities and prior to the effective date of
such registration, WellPoint Delaware shall determine for any reason not to
register or to delay registration of such securities, WellPoint Delaware may,
at its election, give written notice of such determination to the Holder and,
thereupon, (A) in the case of a determination not to register, WellPoint
Delaware shall be relieved of its obligation to register any Registrable
Securities in connection with such registration and (B) in the case of a
determination to delay such registration, WellPoint Delaware shall be permitted
to delay registration of any Registrable Securities requested to be included in
such registration for the same period as the delay in registering such other
securities;
(b) (i) if the registration referred to in the
first sentence of this Section 3 is to be an underwritten primary registration
on behalf of WellPoint Delaware, and the managing underwriter advises WellPoint
Delaware in writing that, in such firm's opinion, such offering would be
materially and adversely affected by the inclusion therein of the Registrable
Securities requested to be included therein, WellPoint Delaware shall include
in such registration: (1) first, all securities WellPoint Delaware proposes to
sell for its own account ("WellPoint Delaware Securities") and (2) second, up
to the full number of Registrable Securities in excess of the number or dollar
amount of WellPoint Delaware Securities, which, in the good-faith opinion of
such managing underwriter, can be so sold without materially and adversely
affecting such offering (and, if less than the full number of such Registrable
Securities, allocated pro rata among the Holders of such Registrable Securities
on the basis of the number of securities requested to be included therein by
each such Holder) and (ii) if the registration referred to in the first
sentence of this Section 3 is to be an underwritten secondary registration on
behalf of holders of securities (other than Registrable Securities) of
WellPoint Delaware (the "Other Holders"), and the managing underwriter advises
WellPoint Delaware in writing that in their good-faith opinion such offering
would be materially and adversely affected by the inclusion therein of the
Registrable Securities requested to be included therein, WellPoint Delaware
shall include in such registration the amount of securities (including
Registrable Securities) that such managing underwriter advises allocated as
follows: (1) first, that number of Registrable Securities requested to be
included therein as shall result in the Holder making such request owning less
than 20% of the total outstanding common equity of WellPoint Delaware and (2)
second, pro rata among the Other Holders and the Holders on the basis of the
number of remaining securities (including Registrable Securities) requested to
be included therein by each Other Holder and each Holder;
(c) WellPoint Delaware shall not be required to
effect any registration of Registrable Securities under this Section 3
incidental to the registration of any of its securities in connection with
mergers, acquisitions, dividend reinvestment plans or stock option or other
executive or employee benefit or compensation plans; and
7.
<PAGE> 9
(d) no registration of Registrable Securities
effected under this Section 3 shall relieve WellPoint Delaware of its
obligation to effect a registration of Registrable Securities pursuant to
Section 2 hereof.
4. EXPENSES. Unless otherwise elected to be borne by a
Holder pursuant to Section 2(c)(ii), WellPoint Delaware agrees to pay all
Registration Expenses with respect to an offering pursuant to Section 2 and
Section 3 hereof.
5. REGISTRATION AND QUALIFICATION. If and whenever
WellPoint Delaware is required to use its best efforts to effect the
registration of any Registrable Securities under the Securities Act as provided
in Section 2 or 3 hereof, WellPoint Delaware, shall:
(a) prepare and file a registration statement
under the Securities Act relating to the Registrable Securities to be offered
as soon as practicable, but in no event later than 30 days (60 days if the
applicable registration form is other than Form S-3) after the date notice is
given, and use its best efforts to cause the same to become effective as
promptly as practicable;
(b) prepare and file with the SEC such amendments
and supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration statement
effective for 70 days (or, in the case of an underwritten offering, such
shorter time period as the underwriters may require);
(c) furnish to the Holders and to any underwriter
of such Registrable Securities such number of conformed copies of such
registration statement and of each such amendment and supplement thereto (in
each case including all exhibits), such number of copies of the prospectus
included in such registration statement (including each preliminary prospectus
and any summary prospectus), in conformity with the requirements of the
Securities Act, and such other documents, as the Holders or such underwriter
may reasonably request in order to facilitate the public sale of the
Registrable Securities, and a copy of any and all transmittal letters or other
correspondence to, or received from, the SEC or any other governmental agency
or self-regulatory body or other body having jurisdiction (including any
domestic or foreign securities exchange) relating to such offering;
(d) use its best efforts to register or qualify
all Registrable Securities covered by such registration statement under the
securities or blue sky laws of such jurisdictions as the Holders or any
underwriter of such Registrable Securities shall request, and use its best
efforts to obtain all appropriate registrations, permits and consents required
in connection therewith, and do any and all other acts and things which may be
necessary or advisable to enable the Holders or any such underwriter to
consummate the disposition in such jurisdictions of its Registrable Securities
covered by such registration statement; provided that WellPoint Delaware shall
not for any such purpose be required to register or qualify generally to do
business as a foreign corporation in any jurisdiction wherein it is not so
qualified, or to subject itself to taxation in any such jurisdiction, or to
consent to general service of process in any such jurisdiction;
8.
<PAGE> 10
(e) (i) use its best efforts to furnish an
opinion of counsel for WellPoint Delaware addressed to the underwriters and
each Holder of Registrable Securities included in such registration (each a
"Selling Holder") and dated the date of the closing under the underwriting
agreement (if any) (or if such offering is not underwritten, dated the
effective date of the registration statement), and (ii) use its best efforts to
furnish a "cold comfort" letter addressed to each Selling Holder, if
permissible under applicable accounting practices, and signed by the
independent public accountants who have audited WellPoint Delaware's financial
statements included in such registration statement, in each such case covering
substantially the same matters with respect to such registration statement (and
the prospectus included therein) as are customarily covered in opinions of
issuer's counsel and in accountants' letters delivered to underwriters in
underwritten public offerings of securities and such other matters as the
Selling Holders may reasonably request and, in the case of such accountants'
letter, with respect to events subsequent to the date of such financial
statements;
(f) immediately notify the Selling Holders in
writing (i) at any time when a prospectus relating to a registration pursuant
to Section 2 or 3 hereof is required to be delivered under the Securities Act
of the happening of any event as a result of which the prospectus included in
such registration statement, as then in effect, includes an 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, in light of the
circumstances under which they were made, not misleading, and (ii) of any
request by the SEC or any other regulatory body or other body having
jurisdiction for any amendment of or supplement to any registration statement
or other document relating to such offering, and in either such case (i) or
(ii) at the request of the Selling Holders, subject to Section 4 hereof,
prepare and furnish to the Selling Holders a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so that,
as thereafter delivered to the purchasers of such Registrable Securities, such
prospectus shall not include an untrue statement of material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they are made,
not misleading;
(g) use its best efforts to list all such
Registrable Securities covered by such registration on each securities exchange
and inter-dealer quotation system on which a class of common equity securities
of WellPoint Delaware is then listed, with expenses in connection therewith to
be paid in accordance with Section 4 hereof; and
(h) furnish unlegended certificates representing
ownership of the Registrable Securities being sold in such denominations as
shall be requested by the Selling Holders or the underwriters with expenses
therewith to be paid in accordance with Section 4 hereof.
6. CONVERSION OF OTHER SECURITIES, ETC. If a Holder
offers any options, rights, warrants or others securities issued by it or any
other person that are offered with, convertible into or exercisable or
exchangeable for any Registrable Securities, the Registrable Securities
underlying such options, rights, warrants or other securities shall be eligible
for registration pursuant to Section 2 and Section 3 of this Agreement.
9.
<PAGE> 11
7. UNDERWRITING, DUE DILIGENCE.
(a) If requested by the underwriters for any
underwritten offering of Registrable Securities pursuant to a registration
requested under this Agreement, WellPoint Delaware shall enter into an
underwriting agreement with such underwriters for such offering, such agreement
to contain such representations and warranties by WellPoint Delaware and such
other terms and provisions as are customarily contained in underwriting
agreements with respect to secondary distributions, including, without
limitation, indemnities and contribution substantially to the effect and to the
extent provided in Section 8 hereof and the provision of opinions of counsel
and accountants' letters to the effect and to the extent provided in Section
5(e) hereof. The Selling Holders on whose behalf the Registrable Securities
are to be distributed by such underwriters shall be parties to any such
underwriting agreement and the representations and warranties by, and the other
agreements on the part of, WellPoint Delaware to and for the benefit of such
underwriters, shall also be made to and for the benefit of such Selling
Holders. Such underwriting agreement shall also contain such representations
and warranties by the Selling Holders on whose behalf the Registrable
Securities are to be distributed as are customarily contained in underwriting
agreements with respect to secondary distributions. Selling Holders may
require that any additional securities included in an offering proposed by a
Holder be included on the same terms and conditions as the Registrable
Securities that are included therein.
(b) In the event that any registration pursuant
to Section 3 shall involve, in whole or in part, an underwritten offering,
WellPoint Delaware may require the Registrable Securities requested to be
registered pursuant to Section 3 to be included in such underwriting on the
same terms and conditions as shall be applicable to the other securities being
sold through underwriters under such registration. If requested by the
underwriters for such underwritten offering, the Selling Holders on whose
behalf the Registrable Securities are to be distributed shall enter into an
underwriting agreement with such underwriters, such agreement to contain such
representations and warranties by the Selling Holders and such other terms and
provisions as are customarily contained in underwriting agreements with respect
to secondary distributions, including, without limitation, indemnities and
contribution substantially to the effect and to the extent provided in Section
8 hereof. Such underwriting agreement shall also contain such representations
and warranties by WellPoint Delaware and such other person or entity for whose
account securities are being sold in such offering as are customarily contained
in underwriting agreements with respect to secondary distributions.
(c) In connection with the preparation and filing
of each registration statement registering Registrable Securities under the
Securities Act, WellPoint Delaware shall give the Holders of such Registrable
Securities and the underwriters, if any, and their respective counsel and
accountants, such reasonable and customary access to its books and records and
such opportunities to discuss the business of WellPoint Delaware with its
officers and the independent public accountants who have certified WellPoint
Delaware's financial statements as shall be necessary, in the opinion of such
Holder and such underwriters or their respective counsel, to conduct a
reasonable investigation within the meaning of the Securities Act.
10.
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8. INDEMNIFICATION AND CONTRIBUTION.
(a) In the case of each offering of Registrable
Securities made pursuant to this Agreement, each of WellPoint Delaware and
WellPoint California agrees to indemnify and hold harmless each Holder, its
officers and directors, each underwriter of Registrable Securities so offered
and each person, if any, who controls any of the foregoing persons within the
meaning of the Securities Act, from and against any and all claims,
liabilities, losses, damages, expenses and judgments, joint or several, to
which they or any of them may become subject, under the Securities Act or
otherwise, including any amount paid in settlement of any litigation commenced
or threatened, and shall promptly reimburse them, as and when incurred, for any
reasonable legal or other expenses incurred by them in connection with
investigating any claims and defending any actions, insofar as such losses,
claims, damages, liabilities or actions shall arise out of, or shall be based
upon, any untrue statement or alleged untrue statement of a material fact
contained in the registration statement (or in any preliminary or final
prospectus included therein) or any amendment thereof or supplement thereto, or
in any document incorporated by reference therein, 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; provided, however,
that neither WellPoint California nor WellPoint Delaware shall be liable to a
particular Holder in any such case to the extent that any such loss, claim,
damage, liability or action arises out of, or is based upon, any untrue
statement or alleged untrue statement, or any omission, if such statement or
omission shall have been made in reliance upon and in conformity with
information relating to such Holder furnished to WellPoint Delaware in writing
by or on behalf of such Holder specifically for use in the preparation of the
registration statement (or in any preliminary or final prospectus included
therein) or any amendment thereof or supplement thereto. Such indemnity shall
remain in full force and effect regardless of any investigation made by or on
behalf of a Holder and shall survive the transfer of such securities. The
foregoing indemnity agreement is in addition to any liability which WellPoint
Delaware or WellPoint California may otherwise have to each Holder, its
officers and directors, underwriters of the Registrable Securities or any
controlling person of the foregoing; provided, further, that, as to any
underwriter or any person controlling any underwriter, this indemnity does not
apply to any loss, liability, claim, damage or expense arising out of or based
upon any untrue statement or alleged untrue statement or omission or alleged
omission in any preliminary prospectus if a copy of a prospectus was not sent
or given by or on behalf of an underwriter to such person asserting such loss,
claim, damage, liability or action at or prior to the written confirmation of
the sale of the Registrable Securities as required by the Securities Act and
such untrue statement or omission had been corrected in such prospectus.
(b) In the case of each offering made pursuant to
this Agreement, each Holder of Registrable Securities included in such
offering, by exercising its registration rights hereunder, agrees to indemnify
and hold harmless WellPoint Delaware, its officers and directors and each
person, if any, who controls any of the foregoing within the meaning of the
Securities Act (and if requested by the underwriters, each underwriter who
participates in the offering and each person, if any, who controls any such
underwriter within the meaning of the Securities Act), from and against any and
all claims, liabilities, losses, damages, expenses and judgments, joint or
several, to which they or any of them may become subject under the
11.
<PAGE> 13
Securities Act or otherwise, including any amount paid in settlement of any
litigation commenced or threatened, and shall promptly reimburse them, as and
when incurred, for any legal or other expenses incurred by them in connection
with investigating any claims and defending any actions, insofar as any such
losses, claims, damages, liabilities or actions shall arise out of, or shall be
based upon, any untrue statement or alleged untrue statement of a material fact
contained in the registration statement (or in any preliminary or final
prospectus included therein) or any amendment thereof or supplement thereto, or
any omission or alleged omission to state therein a material fact relating to
the Holder required to be stated therein or necessary to make the statements
therein not misleading, but in each case only to the extent that such untrue
statement of a material fact contained in, or such material fact relating to
the Holder is omitted from, information relating to such Holder furnished in
writing to WellPoint Delaware by or on behalf of such Holder specifically for
use in the preparation of such registration statement (or in any preliminary or
final prospectus included therein). The foregoing indemnity is in addition to
any liability which such Holder may otherwise have to WellPoint Delaware, or
any of its directors, officers or controlling persons; provided, however, that,
as to any underwriter or any person controlling any underwriter, this indemnity
does not apply to any loss, liability, claim, damage or expense arising out of
or based upon any untrue statement or alleged untrue statement or omission or
alleged omission in any preliminary prospectus if a copy of a prospectus was
not sent to given by or on behalf of an underwriter to such person asserting
such loss, claim, damage, liability or action at or prior to the written
confirmation of the sale of the Registrable Securities as required by the
Securities Act and such untrue statement or omission had been corrected in such
prospectus.
(c) Procedure for Indemnification. Each party
indemnified under paragraph (a) or (b) of this Section 8 shall, promptly after
receipt of notice of any claim or the commencement of any action against such
indemnified party in respect of which indemnity may be sought, notify the
indemnifying party in writing of the claim or the commencement thereof;
provided that the failure to notify the indemnifying party shall not relieve it
from any liability which it may have to an indemnified party on account of the
indemnity agreement contained in paragraph (a) or (b) of this Section 8, except
to the extent the indemnifying party was prejudiced by such failure, and in no
event shall relieve the indemnifying party from any other liability which it
may have to such indemnified party. If any such claim or action shall be
brought against an indemnified party, and it shall notify the indemnifying
party thereof, the indemnifying party shall be entitled to participate therein,
and, to the extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the indemnifying
party to the indemnified party of its election to assume the defense of such
claim or action, the indemnifying party shall not be liable to the indemnified
party under this Section 8 for any legal or other expenses subsequently
incurred by the indemnified party in connection with the defense thereof other
than reasonable costs of investigation; provided that each indemnified party,
its officers and directors, if any, and each person, if any, who controls such
indemnified party within the meaning of the Securities Act, shall have the
right to employ separate counsel reasonably approved by the indemnifying party
to represent them if the named parties to any action (including any impleaded
parties) include both such indemnified party and an indemnifying party or an
affiliate of an indemnifying party, and such indemnified party shall have been
advised by counsel either (i)
12.
<PAGE> 14
that there may be one or more legal defenses available to such indemnified
party that are different from or additional to those available to such
indemnifying party or such affiliate or (ii) a conflict may exist between such
indemnified party and such indemnifying party or such affiliate, and in that
event the fees and expenses of one such separate counsel for all such
indemnified parties shall be paid by the indemnifying party. An indemnified
party will not enter into any settlement agreement which is not approved by the
indemnifying party, such approval not to be unreasonably withheld. The
indemnifying party may not agree to any settlement of any such claim or action
which provides for any remedy or relief other than monetary damages for which
the indemnifying party shall be responsible hereunder, without the prior
written consent of the indemnified party, which consent shall not be
unreasonably withheld. In any action hereunder as to which the indemnifying
party has assumed the defense thereof with counsel reasonably satisfactory to
the indemnified party, the indemnified party shall continue to be entitled to
participate in the defense thereof, with counsel of its own choice, but, except
as set forth above, the indemnifying party shall not be obligated hereunder to
reimburse the indemnified party for the costs thereof. In all instances, the
indemnified party shall cooperate fully with the indemnifying party or its
counsel in the defense of each claim or action.
If the indemnification provided for in this Section 8 shall
for any reason be unavailable to an indemnified party in respect of any loss,
claim, damage or liability, or any action in respect thereof, referred to
herein, then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or liability, or action in
respect thereof, in such proportion as shall be appropriate to reflect the
relative fault of the indemnifying party on the one hand and the indemnified
party on the other with respect to the statements or omissions which resulted
in such loss, claim, damage or liability, or action in respect thereof, as well
as any other relevant equitable considerations. The relative fault shall be
determined by reference to whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the indemnifying party on the one hand or the
indemnified party on the other, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission, but not by reference to any indemnified party's stock
ownership in WellPoint Delaware. In no event, however, shall a Holder be
required to contribute in excess of the amount of the net proceeds received by
such Holder in connection with the sale of Registrable Securities in the
offering which is the subject of such loss, claim, damage or liability. The
amount paid or payable by an indemnified party as a result of the loss, claim,
damage or liability, or action in respect thereof, referred to above in this
paragraph shall be deemed to include, for purposes of this paragraph, any legal
or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any such action or claim. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
(d) With respect to offerings completed under the
Registration Rights Agreement, the indemnification obligations imposed on
WellPoint California under the Registration Rights Agreement shall survive the
execution of this Agreement.
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9. RULE 144. WellPoint Delaware shall take such
measures and file such information, documents and reports as shall be required
by the SEC as a condition to the availability of Rule 144.
10. HOLDBACK.
(a) Each Holder agrees if so required by the
managing underwriter, not to sell, make any short sale of, loan, grant any
option for the purchase of, effect any public sale or distribution of or
otherwise dispose of any securities of WellPoint Delaware, during the 30 days
prior to and the 90 days after any underwritten registration pursuant to
Section 2 or 3 hereof has become effective (or such shorter period as may be
required by the underwriter), except as part of such underwritten registration.
WellPoint Delaware may legend and may impose stop transfer instructions on any
certificate evidencing Registrable Securities relating to the restrictions
provided for in this Section 10.
(b) WellPoint Delaware agrees, if so required by
the managing underwriter, not to sell, make any short sale of, loan, grant any
option for the purchase of (other than pursuant to employee benefit plans),
effect any public sale or distribution of or otherwise dispose of its equity
securities or securities convertible into or exchangeable or exercisable for
any such securities during the 30 days prior to and the 90 days after any
underwritten registration pursuant to Section 2 or 3 hereof has become
effective, except as part of such underwritten registration and except pursuant
to registrations on Form S-4, S-8 or any successor or similar forms thereto.
11. TRANSFER OF REGISTRATION RIGHTS.
(a) A Holder may transfer all or any portion of
its rights under this Agreement to any transferee of Registrable Securities
representing at least 4.9% of the total outstanding common equity of WellPoint
Delaware (each, a "transferee"). The Holder making such transfer shall
promptly notify WellPoint Delaware in writing stating the name and address of
any transferee and identifying the amount of Registrable Securities with
respect to which the rights under this Agreement are being transferred and the
nature of the rights so transferred. In connection with any such transfer, the
term "Holder" as used in this Agreement shall, where appropriate to assign the
rights and obligations of a Holder hereunder to such direct transferee, be
deemed to refer to the transferee holder of such Registrable Securities.
(b) After any such transfer, the Holder making
such transfer shall retain its rights under this Agreement with respect to all
other Registrable Securities still owned by such Holder.
(c) Upon the request of the Holder making such
transfer, WellPoint Delaware shall execute a Registration Rights Agreement with
such transferee or a proposed transferee substantially similar to this
Agreement.
14.
<PAGE> 16
12. RESTRICTION ON TRANSFER.
A Holder shall not transfer any shares of Registrable
Securities whether in a private placement or pursuant to a registration under
this Agreement if such transfer shall, to such Holder's knowledge, result in
Registrable Securities in excess of the Ownership Limit which become Excess
Shares within the meaning of Article VII, Section 2 of WellPoint Delaware's
Restated Certificate of Incorporation. This Section 12 shall expire and be of
no further force or effect in the event WellPoint Delaware ceases to be subject
to any License Agreement, as defined in Section 14 of Article VII of WellPoint
Delaware's Restated Certificate of Incorporation.
13. MISCELLANEOUS.
(a) INJUNCTIONS. Each party acknowledges and
agrees that irreparable damage would occur in the event that any of the
provisions of this Agreement was not performed in accordance with its specific
terms or was otherwise breached. Therefore, each party shall be entitled to an
injunction or injunctions to prevent breaches of the provisions of this
Agreement and to enforce specifically the terms and provisions hereof in any
court having jurisdiction, such remedy being in addition to any other remedy to
which such party may be entitled at law or in equity.
(b) SEVERABILITY. If any term or provision of
this Agreement shall be held by a court of competent jurisdiction to be
invalid, void or unenforceable, the remainder of the terms and provisions set
forth herein shall remain in full force and effect and shall in no way be
affected, impaired or invalidated, and each of the parties shall use its best
efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such term or provision.
(c) FURTHER ASSURANCES. Subject to the specific
terms of this Agreement, each of the parties hereto shall make, execute,
acknowledge and deliver such other instruments and documents, and take all such
other actions, as may be reasonably required in order to effectuate the
purposes of this Agreement and to consummate the transactions contemplated
hereby.
(d) WAIVERS, ETC. No failure or delay on the
part of either party (or the intended third-party beneficiaries referred to
herein) in exercising any power or right hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power,
or any abandonment or discontinuance of steps to enforce such a right or power
preclude any other or further exercise thereof or the exercise of any other
right or power. No modification or waiver of any provision of this Agreement
nor consent to any departure therefrom shall in any event be effective unless
the same shall be in writing and signed by an authorized officer of each of the
parties, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given.
(e) ENTIRE AGREEMENT. This Agreement contains
the entire understanding of the parties with respect to its subject matter.
Except as provided in
15.
<PAGE> 17
Sections 8(a) and 8(d) hereof, this Agreement supersedes all prior agreements
and understandings between the parties, including the Registration Rights
Agreement, whether written or oral, with respect to the subject matter hereof.
The paragraph headings contained in this Agreement are for reference purposes
only, and shall not affect in any manner the meaning or interpretation of this
Agreement.
(f) COUNTERPARTS. For the convenience of the
parties, this Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original but all of which together shall be one
and the same instrument.
(g) AMENDMENT. This Agreement may be amended
only by a written instrument duly executed by an authorized officer of each of
WellPoint Delaware and the Foundation. This Agreement may not be amended to
alter or amend the obligations of WellPoint California under Sections 8(a) or
8(d) hereof without the written consent of WellPoint California.
(h) NOTICES. Unless expressly provided herein,
all notices, claims, certificates, requests, demands and other communications
hereunder shall be in writing and shall be deemed to be duly given (i) when
personally delivered or (ii) if mailed registered or certified mail, postage
prepaid, return receipt requested, on the date the return receipt is executed
or the letter refused by the addressee or its agent or (iii) if sent by
overnight courier which delivers only upon the signed receipt of the addressee,
on the date the receipt acknowledgment is executed or refused by the addressee
or its agent:
(i) if to the Foundation:
California HealthCare Foundation
496 Ninth Street
Oakland, CA 94607
Attn.: Vice President and Secretary
Telecopy No.: (510) 238-1388
With copy to:
Munger, Tolles & Olson LLP
355 South Grand Avenue, Suite 3500
Los Angeles, CA 90071-1560
Attn.: Ruth E. Fisher, Esq.
Telecopy No.: (213) 687-3702
Marron, Reid & Sheehy LLP
601 California Street, Suite 1200
San Francisco, California 94108-2896
Attn.: E. Lewis Reid, Esq.
Telecopier No.: (415) 986-1374
16.
<PAGE> 18
(ii) if to WellPoint Delaware or WellPoint
California, then addressed to WellPoint
Delaware or WellPoint California at:
21555 Oxnard Street
Woodland Hills, CA 91367
Attn.: General Counsel
Telecopy No.: (818) 703-4406
With copy to:
Brobeck Phleger & Harrison LLP
Spear Street Tower
One Market Street
San Francisco, CA 94105
Attn.: William L. Hudson, Esq.
Telecopy No.: (415) 442-1010
(i) GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH
AND BE GOVERNED BY THE INTERNAL LAWS OF THE STATE OF DELAWARE.
(j) TERM. This Agreement shall remain in full
force and effect until there are no Registrable Securities outstanding or until
terminated by the mutual agreement of WellPoint Delaware and the Foundation.
(k) ASSIGNMENT. Except as provided herein, the
parties may not assign their rights under this Agreement. WellPoint Delaware
may not delegate its obligations under this Agreement. WellPoint California
may not delegate its obligations which survive the termination of the
Registration Rights Agreement under Sections 8(a), 8(d) and 13(e) of this
Agreement.
(l) PRIORITY OF RIGHTS. The rights granted to
the Holders under this Agreement shall be senior to and take priority over any
other registration rights granted by WellPoint Delaware. WellPoint Delaware
agrees that it shall not grant any registration rights to any third party
unless such rights are expressly made subject to the rights of the Holders in a
manner consistent with this Agreement. WellPoint Delaware also agrees that it
shall not grant any Holder any registration rights which are senior or take
priority over the registration rights granted to all Holders under this
Agreement.
(m) OWNERSHIP LIMIT. For purposes of this
Agreement, Ownership Limit has the meaning set forth in Section 14 of Article
VII of WellPoint Delaware's Restated Certificate of Incorporation.
17.
<PAGE> 19
IN WITNESS WHEREOF, the Foundation, WellPoint Delaware and WellPoint
California have caused this Agreement to be duly executed by their authorized
representative as of the date first above written.
CALIFORNIA HEALTHCARE FOUNDATION
By: _________________________________
Name:________________________________
Title:_______________________________
WELLPOINT HEALTH NETWORKS INC.,
a Delaware corporation
By: _________________________________
Name:________________________________
Title:_______________________________
WELLPOINT HEALTH NETWORKS INC.,
a California corporation
By: _________________________________
Name:________________________________
Title:_______________________________
18.
<PAGE> 1
Exhibit 10.63
Form of Amended and Restated Share Escrow Agreement
by and among WellPoint Delaware and U.S. Trust Company of California
<PAGE> 2
AMENDED AND RESTATED
SHARE ESCROW AGENT AGREEMENT
THIS AMENDED AND RESTATED SHARE ESCROW AGENT AGREEMENT (this
"Agreement") is made and entered into, as of June ____, 1997 by and among
WellPoint Health Networks Inc., a California corporation (formerly Blue Cross
of California, "WellPoint California"), WellPoint Health Networks Inc., a
Delaware corporation (the "Corporation" or "WellPoint Delaware"), and U.S. Trust
Company of California, N.A., a national association, as share escrow agent (the
"Share Escrow Agent").
WHEREAS, pursuant to an Agreement and Plan of Reorganization
dated June ____, 1997 (the "Reorganization Agreement") among WellPoint Health
Networks Inc., a Delaware corporation, WellPoint California and WLP Acquisition
Corp., a wholly owned subsidiary of WellPoint Delaware ("Merger Sub"), Merger
Sub was merged into WellPoint California, the capital stock of WellPoint
California was converted into capital stock of WellPoint Delaware and the
shareholders of WellPoint California became stockholders of WellPoint Delaware
and the outstanding stock of Merger Sub was converted into stock of WellPoint
California and thereby WellPoint California became a wholly owned subsidiary of
WellPoint Delaware (the "Reorganization");
WHEREAS, as a result of the Reorganization, the parties hereto
wish to cause a novation to the Share Escrow Agent Agreement dated May 20, 1996
(the "Share Escrow Agreement"), such that the Corporation shall replace
WellPoint California as a party to the Share Escrow Agreement;
WHEREAS, the Restated Certificate of Incorporation (the
"Certificate") of the Corporation restrict the ability of any Person to
Beneficially Own shares of Capital Stock in excess of the Ownership Limit (all
capitalized terms used but not defined herein have their respective meanings as
set forth in the Certificate);
WHEREAS, any Transfer that, if effective, would result in a
violation of the Ownership Limit will also result in the creation of Excess
Shares pursuant to the Certificate;
WHEREAS, the Corporation desires to provide for the escrow of
Excess Shares in accordance with the Certificate; and
WHEREAS, the Share Escrow Agent has agreed to act as share
escrow agent for the Corporation in connection with the Excess Shares;
NOW, THEREFORE, the parties hereto agree that the Share Escrow
Agreement is hereby amended and restated to substitute the Corporation for
WellPoint California as a party to this Agreement and that this Agreement is as
follows:
<PAGE> 3
1. Excess Shares Escrow. If the Corporation at any time
determines that a Transfer has taken place such that a Person Beneficially Owns
shares of Capital Stock in excess of the Ownership Limit, or that a Purported
Owner intends to acquire or has attempted to acquire Beneficial Ownership of
any shares of Capital Stock in excess of the Ownership Limit, the Corporation
shall take such action as it deems advisable to refuse to give effect to or
prevent such Transfer, including, without limitation, by causing such Excess
Shares to be transferred immediately to the Share Escrow Agent, which Excess
Shares shall be held by the Share Escrow Agent until such time as the Excess
Shares are transferred to a Person whose acquisition thereof will not violate
the Ownership Limit (a "Permitted Transferee"). The Share Escrow Agent is
hereby authorized and directed by the Corporation to execute any and all
documents sufficient to transfer title to any Permitted Transferee, even in the
absence of receipt of certificate(s) representing Excess Shares.
2. Excess Dividends Escrow. The Share Escrow Agent, as
record holder of all Excess Shares, is entitled to receive all Excess Share
Dividends as may be declared by the Board of Directors of the Corporation and
shall hold all Excess Share Dividends until disbursed in accordance with the
provisions of Section 6. The Share Escrow Agent also agrees to hold in escrow,
subject to the provisions of this Agreement, any amounts it receives from the
Corporation or any Purported Owner of Excess Shares in respect of Excess Shares
Dividends.
3. Liquidation of Corporation. In the event of any
voluntary or involuntary liquidation, dissolution or winding up of, or any
distribution of the assets of, the Corporation, the Share Escrow Agent shall be
entitled to receive, ratably with each other holder of Capital Stock of the
same class or series, that portion of the assets of the Corporation that is
available for distribution to the holders of such class or series of Capital
Stock. The Share Escrow Agent shall distribute to the Purported Owner the
amounts received upon such liquidation, dissolution or winding up or
distribution in accordance with the provisions of Section 6.
4. Voting of Excess Shares. The Share Escrow Agent
shall be entitled to vote all Excess Shares. The Share Escrow Agent shall
vote, consent or assent the Excess Shares as follows at each stockholders'
meeting: (a) if the matter concerned is the election of directors, the Share
Escrow Agent shall vote, consent or assent the whole number of Excess Shares
held by the Share Escrow Agent for each director by multiplying the number of
votes held in escrow by a fraction, the numerator of which is the number of
Nonaffiliated Votes cast for the director and the denominator of which is the
number of Nonaffiliated Votes that could have been cast in the election of the
director and are present in person or by proxy at the meeting; (b) where the
matter under the applicable law of the Corporation's state of incorporation or
the Certificate or the Bylaws of the Corporation requires at least an absolute
majority of all outstanding shares of Common Stock in order to be effected,
then the Share Escrow Agent shall vote, assent or consent all of such Excess
Shares in favor of or in opposition to such matter as the majority of all
Nonaffiliated Votes are cast; and (c) on all other matters, the Share Escrow
Agent shall at all times vote, assent or consent all of such
2.
<PAGE> 4
shares in the identical proportion in favor of or in opposition to such matter
as Nonaffiliated Votes are cast. If any calculation of votes under the
preceding sentence would require a fractional vote, the Share Escrow Agent
shall vote the next lower number of whole Excess Shares. At such stockholders'
meeting the Corporation shall inform the Share Escrow Agent of how the
Nonaffiliated Votes were cast for purposes of determining how the Share Escrow
Agent shall vote the Excess Shares. The Share Escrow Agent shall use all
reasonable commercial efforts to ensure, with respect to Excess Shares, that
such Excess Shares are counted as being present for the purposes of any quorum
required for stockholder action of the Corporation and to vote as set forth
above, provided, that it receives reasonable prior written notice from the
Corporation of any such opportunities to vote the Excess Shares. For purposes
hereof, written notice given to the Share Escrow Agent with respect to voting
of Excess Shares in accordance with applicable state and federal laws, as well
as the Certificate and Bylaws of the Corporation, shall be deemed reasonable.
For purposes hereof "Nonaffiliated Votes" shall mean the votes cast by
stockholders other than the Share Escrow Agent with respect to Excess Shares.
5. Sales of Excess Shares. In an orderly fashion so as
not to materially adversely affect the price of Common Stock on the New York
Stock Exchange or, if Common Stock is not listed on the New York Stock
Exchange, on the exchange or other principal market on which Common Stock is
traded, the Share Escrow Agent shall sell or cause the sale of Excess Shares at
such time or times as the Share Escrow Agent determines to be appropriate. The
Share Escrow Agent shall have the power to convey to the purchaser of any
Excess Shares sold by the Share Escrow Agent ownership of the Excess Shares
free of any interest of the Purported Owner of those Excess Shares and free of
any other adverse interest arising through the Purported Owner. The Share
Escrow Agent shall also have the right to take actions as the Share Escrow
Agent deems appropriate to seek to restrict sale of the shares to Permitted
Transferees. In furtherance of its obligations under this Section 5, the Share
Escrow Agent shall have the right to request the Corporation to make a
determination as to whether a proposed sale of Excess Shares will materially
adversely affect the price of the Common Stock on the New York Stock Exchange
(or, if the Common Stock is not listed on the New York Stock Exchange, on the
exchange or other principal market on which Common Stock is traded) and shall
have no liability for any action it takes pursuant to such determination. Upon
acquisition by any Permitted Transferee of any Excess Shares sold by the Share
Escrow Agent or the Purported Owner, such shares shall upon such sales cease to
be Excess Shares and shall become regular shares of Capital Stock in the class
to which the Excess Shares belong, and the purchaser of such shares shall
acquire such shares free of any claims of the Share Escrow Agent or the
Purported Owner.
6. Distributions From Excess Shares Sold. The proceeds
from the sale of the Excess Shares to a Permitted Transferee, any Excess Share
Dividends and all interest therein pursuant to Section 10 shall be distributed
by the Share Escrow Agent as follows: (a) first, to the Share Escrow Agent for
any costs and expenses incurred in respect of its administration of the Excess
Shares that have not theretofore been reimbursed by the Corporation; (b)
second, to the Corporation for all costs and expenses incurred by the
3.
<PAGE> 5
Corporation in connection with the appointment of the Share Escrow Agent, the
payment of fees to the Share Escrow Agent with respect to the services provided
by the Share Escrow Agent and all funds expended by the Corporation to
reimburse the Share Escrow Agent for costs and expenses incurred by the Share
Escrow Agent in respect of its administration of the Excess Shares and for all
fees, disbursements and expenses incurred by the Share Escrow Agent in
connection with the sale of the Excess Shares; and (c) third, the remainder
thereof (as the case may be) to the Purported Owner or the Person who was the
holder of record before the shares were transferred to the Share Escrow Agent
(depending on who shall at such time be entitled to any economic interest in
the Excess Shares); provided, however, if the Share Escrow Agent shall have any
questions as to whether any security interest or other interest adverse to the
Purported Owner shall have existed with respect to any Excess Shares, the Share
Escrow Agent shall not be obligated to disburse proceeds for those shares until
the Share Escrow Agent is provided with such evidence as the Share Escrow Agent
shall deem necessary to determine the parties who shall be entitled to such
proceeds.
7. Escrow Account: The Share Escrow Agent shall
maintain an escrow account designated as WellPoint Health Networks Inc.
- -- Share Escrow Account (the "Escrow Account"). The Share Escrow Agent shall
deposit all checks and other payments received from the Corporation, Purported
Holders or other Persons pursuant to this Agreement into the Escrow Account.
8. Deposit of Funds.
(a) The Corporation will direct each Purported
Holder to make payment by (i) delivery to the Share Escrow Agent of a personal,
certified or official bank check, and made payable to "U.S. Trust Company of
California, N.A. for WellPoint Health Networks Inc. -- Share Escrow Account" or
(ii) a bank wire transfer to the Escrow Account pursuant to instructions to be
agreed to by the parties.
(b) The Share Escrow Agent will promptly notify
the Corporation of the deposit of any funds into the Escrow Account.
9. Termination Date. Subject to the rights of the Share
Escrow Agent under Sections 12 and 20, which shall continue beyond the
termination of this Agreement, this Agreement shall terminate upon the
Corporation's delivery of a written notice to the Escrow Agent to such effect.
10. Investment of Escrow Property. The Share Escrow
Agent shall promptly invest any escrowed proceeds in any federally insured
money market deposit account that is acceptable to the Corporation. The Share
Escrow Agent and its affiliates may act as agent, principal sponsor, or
depositary, with respect to any such investment. The Share Escrow Agent shall
in no event be liable for any loss resulting from the performance of any funds
invested pursuant to this
4.
<PAGE> 6
Section 10. Interest on proceeds invested pursuant to this Section 10 shall
accrue from the date of investment of such proceeds until the termination of
such investment pursuant to the terms hereof and shall be paid as set forth in
Section 6.
11. Collections. The Share Escrow Agent shall be under
no duty or responsibility to enforce collection of any checks or other
instruments delivered to the Share Escrow Agent hereunder. The Share Escrow
Agent shall promptly notify the Corporation if any check or instrument received
from any Purported Holder shall be dishonored, not accepted or paid, or
otherwise uncollectible. The Share Escrow Agent may recover any costs or
expenses incurred in connection with such transaction from the applicable
Purported Holder or the Corporation.
12. Fees. The Share Escrow Agent shall provide all
administrative and reporting services contemplated by this Agreement. The
Share Escrow Agent's fees and expenses shall be in the amounts as set forth in
Schedule A to that certain Fee Letter Agreement (the "Fee Letter"), from the
Share Escrow Agent to the Corporation, or as otherwise provided herein or
therein. The Corporation shall pay such fees and expenses upon execution of
this Agreement, or as otherwise provided in the Fee Letter. The Share Escrow
Agent shall send the Corporation a final invoice after closing of the escrow
covering all out-of-pocket expenses or any other extraordinary services
rendered.
13. Consultation with Counsel. The Share Escrow Agent
may consult with legal counsel, at the expense of the Corporation (which
expenses shall be reasonable), in the event of any dispute or question as to
the consideration of the foregoing instructions or the Share Escrow Agent's
duties hereunder, and the Share Escrow Agent shall incur no liability and shall
be fully protected in acting in good faith in accordance with the opinion or
advice of such counsel.
14. Notices. All notices, communications and
instructions required or desired to be given hereunder shall be in writing
(including facsimile) and shall be given to such party, addressed to it, at its
address and facsimile number set forth below or to such other address or
facsimile number as such party may have furnished to the other parties in the
manner for giving notices hereunder. Each such notice, communication or
instruction shall be effective (i) if given by mail, five days after such
communication is deposited in the mails with first-class postage prepaid
addressed as aforesaid, (ii) if sent by facsimile to the facsimile number set
forth below, when such facsimile is transmitted and its receipt is
acknowledged, or (iii) if given by any other means, when delivered at the
address specified below,
If to the Corporation, to: WellPoint Health Networks Inc.
21555 Oxnard Street
Woodland Hills, CA 91367
Attn: Thomas C. Geiser
Telephone No.: (818) 703-4000
Facsimile No.: (818) 703-3551
5.
<PAGE> 7
If to the Share Escrow
Agent, to: U.S. Trust Company of California, N.A.
515 South Flower Street, Suite 2700
Los Angeles, CA 90071-2291
Attn: Corporate Trust Department
Telephone No.: (213) 861-5000
Facsimile No.: (213) 488-1370
15. Limited Duties.
(a) The duties and responsibilities of the Share
Escrow Agent shall be limited to those expressly set forth in this Agreement;
provided, however, that this Agreement may be amended at any time or times by
an instrument in writing signed by all the then parties in interest.
(b) The Share Escrow Agent is authorized, in its
sole discretion, to disregard any and all notices or instructions given by any
Person except only such notices or instructions provided by the Corporation or
as otherwise hereinabove provided or an order or process of any court entered
or issued with or without jurisdiction. If any property subject hereto is at
any time attached, garnished or levied upon under any court order or in case
any order, judgment or decree which the Share Escrow Agent is advised by legal
counsel of its own choosing is binding upon it, and further, if the Share
Escrow Agent complies with any such order, writ, judgment or decree it shall
not be liable to the Corporation or to any other Person by reason of such
compliance even though such order, writ, judgment or decree may be subsequently
reversed, modified, annulled, set aside or vacated.
(c) The Share Escrow Agent shall not be
responsible for the sufficiency or accuracy of the form, execution, validity or
genuineness of documents, or securities now or hereafter deposited hereunder,
or of an endorsement thereon, or for any lack of endorsement thereon, for any
description therein, nor shall the Share Escrow Agent be responsible or liable
in any respect on account of the authority or rights of the Persons executing
or delivering or purporting to execute or deliver any such document, security
or endorsement.
(d) The Share Escrow Agent shall not be
responsible in any manner whatsoever for the recitals made herein. It is the
intention of the parties hereto that the Share Escrow Agent shall not be
required to use or advance its own funds or otherwise incur personal financial
liability in the performance of any of its duties or the exercise of any rights
and powers hereunder.
(e) The Share Escrow Agent is not a party to, nor
is it bound by nor need it give consideration to the terms or provisions of,
any other agreement or undertaking between the Corporation and other Persons,
and the Share Escrow Agent is to give consideration only to the terms and
provisions of this Agreement and, to the extent referred to
6.
<PAGE> 8
herein, the Certificate. The Share Escrow Agent's only duties hereunder are to
safeguard the Excess Shares and any monies held in escrow, to vote such shares
as provided herein and to dispose of and deliver the same in accordance with
this Agreement and, to the extent referred to herein, the Certificate. If the
Share Escrow Agent is called upon by the terms of this Agreement to determine
the occurrence of any event or contingency, the Share Escrow Agent shall be
obligated in making such determination, only to exercise reasonable care and
diligence, and, in the event of error in making such determination, the Share
Escrow Agent shall be liable only for its own intentional misconduct or grossly
negligent conduct, and it shall, accordingly, not incur any such liability with
respect to any action taken or omitted in good faith upon advice of its counsel
given in respect to any questions relating to the duties and responsibilities
of the Share Escrow Agent under this Agreement. In determining the occurrence
of any such event or contingency, the Share Escrow Agent may request from the
Corporation or any other Person such additional evidence as the Share Escrow
Agent in its sole discretion may deem necessary to determine any fact relating
to the occurrence of such event or contingency and, in this connection, may
inquire and consult with its counsel and, among others, with the Corporation at
any time, and the Share Escrow Agent shall not be liable for any damages
resulting from its reasonable delay in acting hereunder pending its examination
of the additional evidence requested by it.
(f) In the event of any disagreement between the
parties to this Agreement, or between any of them and any other Person,
resulting in adverse claims or demands being made in connection with the
matters covered by this Agreement, or in the event that the Share Escrow Agent,
in good faith, be in doubt as to what action it should take hereunder, the
Share Escrow Agent may at its option, refuse to comply with any claims or
demands on it, or refuse to take any other action hereunder, so long as such
disagreement continues or such doubt exists, and in any such event, the Share
Escrow Agent shall not be or become liable in any to any Person for its failure
or refusal to act, and the Share Escrow Agent shall be entitled to continue to
refrain from acting until: (i) the rights of all interested parties shall have
been fully and finally adjudicated by a court of competent jurisdiction; or
(ii) all differences shall have been adjudged and all doubt resolved by
agreement among all of the interested Persons, and the Share Escrow Agent shall
have been notified thereof in writing signed by all such Persons.
Notwithstanding the preceding sentence, the Share Escrow Agent may in its
discretion obey the order, judgment, decree or levy of any court, whether with
or without jurisdiction, or of any agency of the United States or any political
subdivision thereof, and the Share Escrow Agent is hereby authorized to obey
such orders, judgments, decrees or levies. The rights of the Share Escrow
Agent under this subsection are cumulative of all other rights which it has by
law or otherwise.
(g) Should any controversy arise between the
parties hereto with respect to this Agreement or with respect to the right of
the Corporation to receive the Excess Shares or any monies held in escrow, the
Share Escrow Agent shall have the right to institute a bill of interpleader in
any court of competent jurisdiction to determine the rights of the parties.
Should a bill of interpleader be instituted, or should the Share Escrow Agent
become involved in litigation in any manner whatsoever on account of this
Agreement for the deposits
7.
<PAGE> 9
made hereunder, the Corporation hereby binds and obligates itself, its
successors and assigns, to pay the Share Escrow Agent, in addition to any
charges made hereunder for acting as Share Escrow Agent, reasonable attorneys'
fees incurred by the Share Escrow Agent, and any other reasonable
disbursements, expenses, losses, costs and damages in connection with and
resulting from such litigation, except in the case where losses or damages
result from the Share Escrow Agent's intentional misconduct or gross
negligence.
(h) Without in any way limiting any other
provision of this Agreement, it is understood and agreed that the Share Escrow
Agent shall be under no duty or obligation to give any notice, except as
expressly provided herein.
(i) The Share Escrow Agent shall not be liable
for any error in judgment or any act or steps taken or permitted to be taken in
good faith, or for anything it may do or refrain from doing in connection
herewith, except for its own intentional misconduct or grossly negligent
conduct.
(j) In no event shall the Share Escrow Agent be
liable for special, indirect or consequential loss or damage of any kind
whatsoever (including but not limited to lost profits), even if the Share
Escrow Agent has been advised of the likelihood of such loss or damage and
regardless of the form of action, except for consequential loss or damage
arising out of the Share Escrow Agent's own intentional misconduct or grossly
negligent conduct.
16. Records. The Share Escrow Agent shall maintain
accurate records of all transactions hereunder. Promptly after the termination
of the Escrow Account, or as may reasonably be requested by the Corporation
from time to time before such termination, the Share Escrow Agent shall provide
the Corporation with a complete copy of such records, certified by the Share
Escrow Agent to be a complete and accurate account of all such transactions.
The authorized representatives of the Corporation shall also have access to
such books and records at all reasonable times during normal business hours
upon reasonable notice to the Share Escrow Agent.
17. Governing Law; Binding. This Agreement is being made
in, is governed by and is intended to be construed according to the laws of the
State of Delaware. It shall inure to and be binding upon the parties hereto,
their successors and assigns.
18. Severability. In case any one or more of the
provisions contained in this Agreement shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality
or unenforceability shall not affect any other provisions of this Agreement,
but this Agreement shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein.
19. Time. Whenever under the terms of this Agreement the
performance date of any provision hereof shall fall on a day which is not a
legal banking day, and upon
8.
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which the Share Escrow Agent is not open for business, the performance thereof
on the next succeeding business day of the Share Escrow Agent shall be deemed
to be in full compliance.
20. Indemnification. The Share Escrow Agent shall be
indemnified and held harmless by the Corporation, from and against any
expenses, including reasonable counsel fees and disbursements, or loss suffered
by the Share Escrow Agent in connection with any claim or demand, which, in any
way, directly or indirectly, arises out of or relates to this Agreement or the
services of the Share Escrow Agent hereunder except in the case of gross
negligence or intentional misconduct under this Agreement by the Share Escrow
Agent. Promptly after the receipt by the Share Escrow Agent of notice of any
demand or claim or the commencement of any action, suit or proceeding, the
Share Escrow Agent shall notify the Corporation in writing.
21. Successors. The Share Escrow Agent may be merged or
consolidated with or into any entity or transfer all or substantially all of
its assets to any entity, in which case, any entity resulting from any merger
or consolidation or any entity succeeding to the business of the Share Escrow
Agent, shall be successor of the Share Escrow Agent hereunder without the
execution or filing of any paper or further act by any of the parties hereto.
In case at any time the Share Escrow Agent or its legal successor or successors
should become unable, through operation of law or otherwise, to act as Share
Escrow Agent, or if its properties and affairs shall be taken under the control
of any court or administrative body because of insolvency or bankruptcy or for
any other reason, a vacancy shall forthwith and ipso facto exist in the office
of the Share Escrow Agent, a successor Share Escrow Agent shall be appointed by
the Corporation. The Corporation may be merged or consolidated with or into
any entity or transfer all or substantially all of its assets to any entity, in
which case, any entity resulting from any merger or consolidation or any entity
succeeding to the business of the Corporation, shall be successor of the
Corporation hereunder without the execution or filing of any paper or further
act by any of the parties hereto.
22. Resignation. The Share Escrow Agent may resign at
any time upon thirty (30) days' prior written notice to the Corporation,
whereupon the Corporation shall appoint a substitute Share Escrow Agent and the
Share Escrow Agent shall deliver the Excess Shares and monies held in escrow to
any designated substitute Share Escrow Agent selected by the Corporation. If
the Corporation does not designate a substitute Share Escrow Agent within ten
(10) days, the Share Escrow Agent may, in its sole discretion, institute a bill
of interpleader as contemplated herein or otherwise submit appropriate
pleadings. Notwithstanding the immediately preceding sentence, until a
substitute Share Escrow Agent has been named and accepts its appointment or
until another disposition of the Excess Shares and monies held in the Escrow
Account has been agreed upon by all the parties hereto, the Share Escrow Agent
shall be discharged of all of its duties and obligations hereunder except to
hold such Excess Shares and monies in escrow.
9.
<PAGE> 11
23. Counterparts. This Agreement may be executed in
multiple counterparts, each of which shall be deemed an original and all of
which shall constitute but one and the same instrument.
24. No Fiduciary Duty to Purported Holders. The Share
Escrow Agent shall not be deemed to be a fiduciary or agent of any Purported
Holder or other Person other than the Corporation.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective duly authorized officers, as of
the date first above written at Los Angeles, California.
U.S. TRUST COMPANY OF CALIFORNIA, N.A.
By:____________________________________
Its: Authorized Officer
WELLPOINT HEALTH NETWORKS INC.
a Delaware corporation
By:____________________________________
Its:___________________________
WELLPOINT HEALTH NETWORKS INC.
a California corporation
By:____________________________________
Its:___________________________
10.
