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Physician Corporation of America

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Stock Purchase Agreement

DATED AS OF DECEMBER 30, 1999

AMONG

HUMANA INC.

PHYSICIAN CORPORATION OF AMERICA

AND

FOLKSAMERICA HOLDING COMPANY, INC.

TABLE OF CONTENTS

ARTICLE I — DEFINITIONS

ARTICLE II — PURCHASE AND SALE OF SHARES

ARTICLE III — REPRESENTATIONS AND WARRANTIES OF SELLER AND HUMANA

ARTICLE IV — REPRESENTATIONS AND WARRANTIES OF SELLER

ARTICLE V — REPRESENTATIONS AND WARRANTIES OF PURCHASER

ARTICLE VI — ADDITIONAL AGREEMENTS

ARTICLE VII — EMPLOYEE MATTERS

ARTICLE VIII — TAX MATTERS

ARTICLE IX — CONDITIONS TO CLOSING

ARTICLE X — INDEMNIFICATION & CERTAIN LITIGATION

ARTICLE XI — TERMINATION, AMENDMENT AND WAIVER

ARTICLE XII — GUARANTY OF HUMANA

ARTICLE XIII — GENERAL PROVISIONS

This Stock Purchase Agreement is made and effective as of December 30, 1999, by and among HUMANA INC., a Delaware corporation ("HUMANA"), PHYSICIAN CORPORATION OF AMERICA, a Delaware corporation and a wholly owned subsidiary of Humana ("SELLER"), and FOLKSAMERICA HOLDING COMPANY, INC., a New York corporation ("PURCHASER").

W I T N E S S E T H:

WHEREAS, Seller owns all of the issued and outstanding shares of common stock, par value $1.00 per share (the "SHARES"), of PCA Property and Casualty Insurance Company, an insurance company organized under the laws of the State of Florida (the "COMPANY");

WHEREAS, Seller wishes to sell the Shares to Purchaser, and Purchaser wishes to purchase the Shares from Seller, on the terms and subject to the conditions set forth herein; and

WHEREAS, Humana has joined in this Agreement solely for the purpose of guaranteeing the obligations of Seller under this Agreement and making certain representations, warranties and covenants for the benefit of Purchaser.

NOW, THEREFORE, in consideration of the premises and of the mutual agreements and covenants hereinafter set forth, the parties hereby agree as follows:

ARTICLE I — DEFINITIONS

Section 1.01. Certain Defined Terms.

As used in this Agreement, the following terms shall have the following meanings:

"Acquisition Proposal" has the meaning specified in Section 6.06.

"Adjusted Purchase Price" has the meaning specified in Section 2.02(a).

"Adjustment" has the meaning specified in Section 8.05.

"Affiliate" means any other Person directly or indirectly controlling or controlled by or under common control with such Person.

"Company" means PCA Property and Casualty Insurance Company.

"Closing Date" means the date on which the Closing takes place.

"Encumbrances" means any lien, pledge, mortgage, security interest, assessment, claim, lease, charge, option, right of first refusal, imperfection of title, easement, transfer restriction, encumbrance or other restriction or limitation of any kind whatsoever.

"Material Adverse Effect" means any change in, or effect on, the Company or the Business which is materially adverse to the Business, operations, assets, liabilities, results of operations, or condition of the Company.

"Purchaser" has the meaning specified in the Preamble.

"Seller" has the meaning specified in the Preamble.

"Shares" has the meaning specified in the Recitals.

ARTICLE II — PURCHASE AND SALE OF SHARES

Section 2.01. Purchase of Shares.

Subject to the terms and conditions contained in this Agreement, at the Closing, Seller shall sell the Shares to Purchaser, and Purchaser shall purchase the Shares from Seller.

Section 2.02. Purchase Price.

The purchase price for the Shares shall be equal to (the "Provisional Purchase Price"), which shall be adjusted pursuant to the terms of Section 2.02(b) to reflect the difference, if any, between the Initial Net Loss and the Final Net Gain or Loss.

Initial Net Loss:

Final Net Gain or Loss:

Valuation Report Date:

Within ten (10) days following the Closing, the Purchaser shall cause the Company to prepare, and deliver to Seller, a report setting forth the Final Net Gain or Loss.

Any changes in the Valuation Report that are agreed to by Purchaser and Seller shall be incorporated into a final Valuation Report.

Section 2.03. Pre-Closing Adjustments to the Investment Portfolio.

Reference Date:

Subject Schedule D:

Purchaser's Designated Securities list received:

Designated Securities details:

Section 2.04. Closing.

Closing Date:

Closing Time:

Closing Location:

Section 2.05. Deliveries and Actions to be Taken at Closing.

Seller closing deliverables shall include stock certificates, certificates of authority, articles of incorporation, by-laws, officer certificates, good standing certificates, legal opinions, and other closing documents.

Purchaser closing deliverables shall include the provisional purchase price, officer certificates, legal opinions, and other closing documents.

ARTICLE III — REPRESENTATIONS AND WARRANTIES OF SELLER AND HUMANA

Seller and Humana hereby jointly and severally represent and warrant to Purchaser as follows:

Each of Humana and Seller is duly incorporated and validly existing in good standing.

Humana owns all of the issued and outstanding capital stock of Seller free and clear of all Encumbrances.

No conflict exists that would prevent performance of this Agreement.

No representation or warranty contains any untrue statement of material fact or omission necessary to make the statements not misleading.

ARTICLE IV — REPRESENTATIONS AND WARRANTIES OF SELLER

The Company is duly incorporated, validly existing, and in good standing under the laws of Florida.

The Shares constitute all issued and outstanding shares of capital stock of the Company.

The Company has no Subsidiaries.

Financial information, reserves, litigation, compliance, licenses, permits, intellectual property, property, insurance coverage, affiliate agreements, reinsurance agreements, contracts, employee benefit matters, labor matters, taxes, agents, accounts with financial institutions, minute books, management contract, year 2000 matters, brokers, and disclosure are addressed in the full agreement.

Company has all governmental licenses and permits necessary to carry on the Business.

HWCS Management Contract and Amended and Restated Management Contract details are subject to Exhibits A, B-1, and B-2.

ARTICLE V — REPRESENTATIONS AND WARRANTIES OF PURCHASER

Purchaser is duly incorporated and validly existing in good standing under the laws of New York.

Purchaser is acquiring the Shares solely for its own account and not for distribution in violation of securities laws.

No broker, finder, or investment banker is entitled to any brokerage, finder's or other fee except as disclosed.

ARTICLE VI — ADDITIONAL AGREEMENTS

Seller covenants to conduct the business in the ordinary course, preserve business organization, maintain books and records, keep insurance in force, and prepare required statements.

Seller shall not permit prohibited corporate actions without Purchaser consent.

Purchaser and Seller shall cooperate on regulatory filings, consents, and authorizations.

Notice of certain matters shall be given promptly in writing.

Intercompany accounts and affiliate agreements shall be settled or terminated at Closing.

Further actions and compliance with conditions shall be completed as needed to consummate the transaction.

ARTICLE VII — EMPLOYEE MATTERS

Purchaser shall have no obligations with respect to employee benefit plans or employees of the Company, Seller, or Humana.

ARTICLE VIII — TAX MATTERS

Seller agrees to indemnify Purchaser and the Company for specified Taxes relating to pre-closing periods.

Tax Return responsibility is allocated by period and party.

Refunds, tax contests, audit adjustments, conveyance taxes, FIRPTA certificate, tax sharing agreement, and net operating loss arrangements are governed by this Article.

Tax Contest status notice required:

FIRPTA Certificate received:

ARTICLE IX — CONDITIONS TO CLOSING

Conditions include truth of representations and warranties, HSR Act expiration, no prohibited order or suit, governmental filings and consents, third party consents, and satisfactory proceedings.

Resignation of directors and certain officers of the Company:

Amended and Restated Management Contract executed:

ARTICLE X — INDEMNIFICATION & CERTAIN LITIGATION

Indemnification provisions allocate responsibility for breaches, damages, limitations, notice, and defense of third-party claims.

Certain litigation, malpractice action, and DOLES applications are specifically addressed.

ARTICLE XI — TERMINATION, AMENDMENT AND WAIVER

The Agreement may be terminated by mutual consent, by either party if Closing does not occur by July 31, 2000, or by a non-breaching party following uncured material breach.

ARTICLE XII — GUARANTY OF HUMANA

Humana irrevocably guarantees performance of Seller's obligations under this Agreement.

ARTICLE XIII — GENERAL PROVISIONS

Notices, public announcement, headings, severability, entire agreement, assignment, third-party beneficiaries, amendment, waiver, governing law, and counterparts are governed by this Article.

Governing Law:

HUMANA INC.

By:

Title:

Signature:

PHYSICIAN CORPORATION OF AMERICA

By:

Title:

Signature:

FOLKSAMERICA HOLDING COMPANY, INC.

By:

Title:

Signature:

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What the Physician Corporation of America document is

Physician Corporation of America is a standardized legal template used to form a professional corporation for licensed physicians and related medical professionals. It sets out the corporation name, stated professional purpose, ownership and share structure, director and officer roles, and clauses addressing malpractice insurance and licensure. The form is typically paired with bylaws, shareholder agreements, and state filing schedules and submitted to the Secretary of State or equivalent agency for incorporation under professional corporation statutes.

Why organizations use a Physician Corporation of America form

Provides a corporate framework that limits personal exposure for business activities, documents ownership and governance for a medical practice, and aligns corporate structure with state professional corporation laws and payer credentialing requirements.

Why organizations use a Physician Corporation of America form

Who typically prepares or completes this document

Typical users and completing parties include medical practice founders, managing physicians, practice administrators, and corporate counsel.

  • Physician founders and shareholder-members who must be licensed in the state where services are rendered.
  • Practice administrators preparing filings, coordinating licenses, and collecting corporate documentation for payer enrollment.
  • Corporate attorneys or compliance officers drafting bylaws, shareholder agreements, and malpractice allocation provisions.

The form is also used during ownership transfers, mergers, or when updating corporate governance to comply with licensing rules.

Key roles involved in completion

Founding Physician

Typically a licensed physician who holds majority or designated shares, oversees clinical governance and signs corporate documents. Responsible for meeting state medical board requirements, coordinating malpractice coverage, and ensuring only licensed practitioners render professional services under the corporate entity.

Practice Administrator

Staff or manager who prepares filings, maintains corporate records, coordinates state registrations and tax accounts, and manages communications with payers and regulators. Often responsible for collecting shareholder consents and keeping minutes and certificates current.

Security, compliance, and technical assurances to consider

Encryption: TLS 1.2/1.3 in transit; AES-256 at rest
Certifications: SOC 2 Type II; ISO 27001; PCI DSS
HIPAA: BAA available for processing protected health information
Audit Trail: Time-stamped actions, IP addresses, and signer attribution
21 CFR Part 11: Supports electronic records and signature controls
Accessibility: WCAG 2.0 Level AA compliance

Step-by-step: completing and filing the Physician Corporation of America

Follow these steps to prepare, sign, and submit a Physician Corporation of America form in compliance with state rules.

  • 01
    Draft: Draft articles of incorporation, purpose, and professional statements.
  • 02
    Board and Shares: Define shareholder eligibility and share classes for licensed practitioners.
  • 03
    Regulatory Attachments: Attach licenses, malpractice insurance proof, and practitioner consents.
  • 04
    File & Record: File with Secretary of State and record corporate minutes.

Configuring an online workflow for signatures and attachments

Customize online workflows for the Physician Corporation of America to collect signatures, attachments, and conditional fields.

Field Configuration
Authentication Email link | Optional SMS code or knowledge-based verification
Attachments Required documents | Verify licenses and insurance PDFs
Conditional Fields Yes | Display shareholder consent when profession selected
Audit Settings Audit trail | Include timestamps, IP, signer info

Typical routing and submission path

Typical routing and submission path for the Physician Corporation of America, from internal approval through state filing and record retention.

  • Prepare: Assemble corporate paperwork and supporting licenses.
  • Route: Send to shareholders and counsel for review and signatures.
  • Sign: Collect electronic signatures with identity verification.
  • File: Submit to Secretary of State and distribute certified copies.

Platform and integration considerations for eSigning and eSubmission

Use an eSignature platform that supports audit trails, attachments for licenses, conditional fields, and HIPAA BAA when handling protected health information.

  • File Formats: PDF and DOCX supported
  • Integrations: NetSuite, Salesforce, Google Workspace
  • Authentication: Email, SMS, KBA, or SSO

Key filing and processing time expectations

Key filing and processing deadlines related to forming or updating a Physician Corporation of America.

State Filing:

Variable by state; typically processed 5–30 business days

Tax Registration:

Obtain EIN before payroll; IRS processing varies

Payer Enrollment:

Credentialing may take 45–90 days

Shareholder Updates:

File amendments within state deadlines, often 30–60 days

Recordkeeping:

Retain corporate records per state and federal rules

Common mistakes to avoid when preparing the form

  • Entering an individual's name instead of the legal corporate name on contracts and payer forms, causing credentialing mismatches and payment or tax reporting issues.
  • Failing to attach current professional licenses or malpractice insurance certificates, which delays payer enrollment and may cause state filing rejections.
  • Using ambiguous ownership language or failing to document shareholder eligibility, creating disputes over voting rights and professional control later.
  • Neglecting required state-specific statements for professional corporations, such as licensed-practitioner ownership clauses or statutory disclaimers, which can invalidate the filing.

Penalties and legal risks of incorrect or incomplete filings

Tax Penalties: Late or incorrect filings can trigger IRS or state fines
Credentialing Delays: Missing documents cause payment delays from insurers
License Risk: Unauthorized practice may trigger medical board sanctions
Personal Liability: Improper structure can expose owners to personal liability
Notarization Errors: Invalid acknowledgements can render state filings defective
Document Rejection: Incorrect signatures or missing consents cause rejections

Practical scenarios showing how the form is used

Real-world examples show how a Physician Corporation of America template is used to form practices, transfer ownership, and support insurance and credentialing workflows.

New Clinic Formation

A group of three physicians used the document to incorporate a joint professional corporation and define governance and ownership percentages.

  • Filed with Secretary of State and attached licenses.
  • The formal corporate structure clarified malpractice responsibility, enabled payer enrollment under the corporation, and centralized payroll and billing for streamlined tax reporting and operations.

Shareholder Transfer

A retiring physician transferred shares to a partner with a signed shareholder agreement and updated articles.

  • Signatures from all parties and license verification enclosed.
  • The transfer preserved continuity of care, updated insurer records, and reduced disputes by documenting valuation method and buyout terms in advance.

Core elements contained in the Physician Corporation of America

The document typically combines statutory articles with governance, professional qualifications, insurance, and transfer provisions tailored for licensed practitioners.

Articles

Statutory articles of incorporation that include corporate name, address, and the specific professional purpose required by state professional corporation statutes.

Bylaws

Rules for internal governance, director selection, meeting procedures, voting thresholds, and operational protocols tailored to medical practice needs.

Shareholder Agreement

Terms governing ownership transfers, buy-sell mechanisms, restrictions on non-licensed shareholders, and valuation methods on exit or death.

Professional Clause

Language confirming only licensed practitioners may provide professional services and specifying license verification and reporting obligations.

Insurance Provisions

Statements of required malpractice coverage levels, named insured terms, and allocation of premium responsibilities among shareholders.

Dissolution

Provisions for dissolution, winding up, asset distribution, and handling of outstanding patient or creditor claims upon termination.

Downloading, supporting documents, and export options

Options for saving and providing supporting evidence vary; prepare certified copies and export signed records in accepted file formats.

Download Options

Export signed documents asISO-compatible PDFs or DOCX for state filing and recordkeeping; include a certificate of completion for audit purposes.

Certified Copies

Obtain certified copies from the Secretary of State when required by payers or lenders; retain electronic certified files alongside originals.

Supporting Documents

Attach state medical licenses, malpractice declarations, EIN confirmation, and shareholder consent forms when submitting or sharing the entity record.

Electronic Records

Maintain tamper-evident electronic records with audit trails to satisfy reproduction and retention requirements under ESIGN and UETA.

eSignature vendor comparison for Physician Corporation of America workflows

Comparison of common eSignature vendor entry-level features and pricing to help assess electronic signing options for Physician Corporation of America document workflows.

signNow DocuSign Adobe Sign PandaDoc HelloSign
Starting Price $8/user/mo $15/user/mo $14/user/mo $19/user/mo $15/user/mo
Free Trial Yes, 7-day trial Varies by vendor Varies by vendor Varies by vendor Varies by vendor
Bulk Send Yes Yes Yes Yes No
Audit Trail Yes Yes Yes Yes Yes
HIPAA Compliant Yes Yes Yes No No
Envelope Cap No envelope cap 100 envelopes/user/year Varies by plan Varies by plan Varies by plan

Practical tips for accurate and efficient completion

Small process improvements reduce rework, speed credentialing, and lower the risk of rejected filings.

Verify Names and Licenses
Confirm shareholder names exactly match government-issued IDs and professional license records; mismatches commonly delay credentialing and state filings.
Consolidate Attachments
Attach copies of malpractice insurance, active licenses, EIN confirmation, and shareholder consents at initial submission to avoid follow-up requests.
Use Clear Ownership Language
State share classes, voting rights, and buy-sell conditions explicitly to prevent disputes and simplify future transfers or buyouts.
Maintain Audit Trails
Retain signed copies with tamper-evident certificates and an audit log showing timestamps, IP addresses, and signer identity verification steps.

Frequently asked questions about the Physician Corporation of America

Answers to common legal, filing, and electronic signing questions encountered when using a Physician Corporation of America form.


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