PURCHASE AGREEMENT

 

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                                                                    Exhibit 10.9

 

                                AMR HOLDCO, INC.

                               EMCARE HOLDCO, INC.

 

                                  $250,000,000

 

                      10% Senior Subordinated Notes due 2015

 

                               PURCHASE AGREEMENT

 

                             dated January 27, 2005

 

                         BANC OF AMERICA SECURITIES LLC

                           J.P. MORGAN SECURITIES INC.

 

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                               PURCHASE AGREEMENT

 

January 27, 2005

 

BANC OF AMERICA SECURITIES LLC

J.P. MORGAN SECURITIES INC.

     As Initial Purchasers

c/o Banc of America Securities LLC

9 West 57th Street

New York, New York   10019

 

Ladies and Gentlemen:

 

            Introductory. AMR HoldCo, Inc., a Delaware corporation ("AMR

HoldCo"), and EmCare HoldCo, Inc., a Delaware corporation ("EmCare HoldCo" and,

collectively with AMR HoldCo, the "Issuers"), propose to issue and sell to the

several Initial Purchasers named in Schedule A (the "Initial Purchasers"),

acting severally and not jointly, the respective amounts set forth in such

Schedule A of $250,000,000 aggregate principal amount of the Issuers' 10% Senior

Subordinated Notes due 2015 (the "Notes"). Banc of America Securities LLC and

J.P. Morgan Securities Inc. have agreed to act as representatives of the several

Initial Purchasers in connection with the offering and sale of the Notes.

 

            The Notes will be issued pursuant to an indenture, dated as of the

Closing Date (as defined in Section 2 hereof) (the "Indenture"), among the

Issuers, the Guarantors (as defined below) and U.S. Bank Trust National

Association, as trustee (the "Trustee"). Notes will be issued only in book-entry

form in the name of Cede & Co., as nominee of The Depository Trust Company (the

"Depositary"), pursuant to a letter of representations, to be dated on or before

the Closing Date (the "DTC Agreement"), among the Issuers, the Guarantors, the

Trustee and the Depositary.

 

            The holders of the Notes will be entitled to the benefits of a

registration rights agreement, dated as of the Closing Date (the "Registration

Rights Agreement"), among the Issuers, the Guarantors and the Initial

Purchasers, pursuant to which the Issuers and the Guarantors will agree to file

with the Securities and Exchange Commission (the "Commission"), under the

circumstances set forth therein, (i) a registration statement under the

Securities Act of 1933 (as amended, the "Securities Act," which term, as used

herein, includes the rules and regulations of the Commission promulgated

thereunder) relating to another series of debt securities of the Issuers with

terms substantially identical to the Notes (the "Exchange Notes") to be offered

in ex-

 

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change for the Notes (the "Exchange Offer") and (ii) to the extent required by

the Registration Rights Agreement, a shelf registration statement pursuant to

Rule 415 of the Securities Act relating to the resale by certain holders of the

Notes, and in each case, to use their commercially reasonable efforts to cause

such registration statements to be declared effective.

 

            The payment of principal of, premium and Liquidated Damages (as

defined in the Indenture), if any, and interest on the Notes and the Exchange

Notes will initially be fully and unconditionally guaranteed on a senior

subordinated basis, jointly and severally, by Emergency Medical Services L.P.,

the direct parent corporation of the Issuers (the "Parent"), and each domestic

subsidiary of an Issuer as of the Closing Date, and, in each case their

respective successors and assigns (together with the Parent, the "Guarantors"),

in each case pursuant to their guarantees (the "Guarantees"); provided, that,

with respect to any representation or warranty made, and any covenant,

obligation or agreement to be performed, shall be made by, and shall be

effective with respect to, a Guarantor (other than Parent) only concurrently

with the Closing Date and the execution and delivery by such Guarantor of a

Joinder Agreement (as defined below) substantially in the form of Exhibit D

hereto. The Notes and the Guarantees attached thereto are herein collectively

referred to as the "Securities"; and the Exchange Notes and the Guarantees

attached thereto are herein collectively referred to as the "Exchange

Securities."

 

            The proceeds of the Notes, together with an equity contribution of

$219.0 million and initial borrowings of approximately $355.0 million under the

new $450.0 million senior secured credit facility (the "Senior Secured Credit

Facility" and together with all other agreements related to such facility, the

"Credit Documents") will be used to fund the purchase of American Medical

Response, Inc. ("AMR") and EmCare Holdings Inc. ("EmCare" and together with AMR,

the "Targets"), and pay related fees and expenses (collectively, the

"Transactions").

 

            The Issuers understand that the Initial Purchasers propose to make

an offering of the Securities on the terms and in the manner set forth herein

and in the Offering Memorandum (as defined below) and agree that the Initial

Purchasers may resell, subject to the conditions set forth herein, all or a

portion of the Securities to purchasers (the "Subsequent Purchasers") at any

time after the date of this Agreement. The Securities are to be offered and sold

to or through the Initial Purchasers without being registered with the

Commission under the Securities Act, in reliance upon exemptions therefrom.

Pursuant to the terms of the Securities and the Indenture, investors who acquire

Securities shall be deemed to have agreed that Securities may only be resold or

otherwise transferred, after the date hereof, if such Securities are registered

for sale under the Securities Act or if an exemption from the registration

requirements of the Securities Act is available (including the exemptions

afforded by Rule 144A under the Securities Act ("Rule 144A") or Regulation S

under the Securities Act ("Regulation S")).

 

            The Issuers have prepared and delivered to each Initial Purchaser

copies of a Preliminary Offering Memorandum, dated January 17, 2005 (the

"Preliminary Offering Memorandum"), and have prepared and will deliver to each

Initial Purchaser copies of the Offering Memorandum, dated January 27, 2005,

describing the terms of the Securities, each for use by such Initial Purchaser

in connection with its solicitation of offers to purchase the Securities. As

used herein, the "Offering Memorandum" shall mean, with respect to any date or

time referred to in this Agreement, the Issuers' Offering Memorandum, dated

January 27, 2005, including

 

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amendments or supplements thereto, the Canadian supplement thereto and any

exhibits thereto, in the most recent form that has been prepared by the Issuers

and delivered to the Initial Purchasers in connection with their solicitation of

offers to purchase Securities.

 

            Effective concurrently with the closing of the Transactions, each

Guarantor (other than the Parent) shall execute a joinder agreement (the

"Joinder Agreement"), substantially in the form of Exhibit D hereto, pursuant to

which each such entity will become a party to this Agreement effective as of the

Closing Date.

 

            All references in this Agreement to financial statements and other

information which is "contained," "included" or "stated" in the Offering

Memorandum (or other references of like import) shall be deemed to mean and

include all such financial statements in the Offering Memorandum.

 

            The Issuers hereby confirm their agreements with the Initial

Purchasers as follows:

 

            Section 1. Representations and Warranties. Each of the Issuers and

the Guarantors, jointly and severally, hereby represents, warrants and covenants

to each Initial Purchaser as follows:

 

            (a) No Registration Required. Subject to compliance by the Initial

Purchasers with the representations and warranties set forth in Section 2(e)

hereof and with the procedures set forth in Section 7 hereof, it is not

necessary in connection with the offer, sale and delivery of the Securities to

the Initial Purchasers and to each Subsequent Purchaser in the manner

contemplated by this Agreement and the Offering Memorandum to register the

Securities under the Securities Act or, until such time as the Exchange

Securities are issued pursuant to an effective registration statement, to

qualify the Indenture under the Trust Indenture Act of 1939 (the "Trust

Indenture Act," which term, as used herein, includes the rules and regulations

of the Commission promulgated thereunder).

 

            (b) No Integration of Offerings or General Solicitation. None of the

Issuers, their respective affiliates (as such term is defined in Rule 501 under

the Securities Act) (each, an "Affiliate") or any person acting on its or any of

their behalf (other than the Initial Purchasers, as to whom the Issuers make no

representation or warranty) has, directly or indirectly, solicited any offer to

buy or offered to sell, and will not, directly or indirectly, solicit any offer

to buy or offer to sell, in the United States or to any United States citizen or

resident, any security which is or would be integrated with the sale of the

Securities in a manner that would require the Securities to be registered under

the Securities Act. None of the Issuers, their respective Affiliates or any

person acting on its or any of their behalf (other than the Initial Purchasers,

as to whom the Issuers make no representation, warranty or covenant) has engaged

or will engage, in connection with the offering of the Securities, in any form

of general solicitation or general advertising within the meaning of Rule 502

under the Securities Act. With respect to those Securities sold in reliance upon

Regulation S, (i) none of the Issuers, their respective Affiliates or any person

acting on its or their behalf (other than the Initial Purchasers, as to whom the

Issuers make no representation, warranty or covenant) has engaged or will engage

in any directed selling efforts within the

 

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meaning of Regulation S and (ii) each of the Issuers and their respective

Affiliates and any person acting on its or their behalf (other than the Initial

Purchasers, as to whom the Issuers make no representation, warranty or covenant)

has complied and will comply with the offering restrictions set forth in

Regulation S.

 

            (c) Eligibility for Resale Under Rule 144A. The Securities are

eligible for resale pursuant to Rule 144A and will not be, at the Closing Date,

of the same class as securities listed on a national securities exchange

registered under Section 6 of the Securities Exchange Act of 1934 (as amended,

the "Exchange Act," which term, as used herein, includes the rules and

regulations of the Commission promulgated thereunder) or quoted in a U.S.

automated interdealer quotation system.

 

            (d) The Offering Memorandum. The Offering Memorandum does not, and

at the Closing Date will not, include an untrue statement of a material fact or

omit to state a material fact necessary in order to make the statements therein,

in the light of the circumstances under which they were made, not misleading;

provided that this representation, warranty and agreement shall not apply to

statements in or omissions from the Offering Memorandum made in reliance upon

and in conformity with information furnished to the Issuers in writing by any

Initial Purchaser expressly for use in the Offering Memorandum. Each of the

Preliminary Offering Memorandum and the Offering Memorandum, as of its date,

contains all the information specified in, and meeting the requirements of, Rule

144A. Neither of the Issuers nor any Guarantor has distributed and none of them

will distribute, prior to the later of the Closing Date and the completion of

the Initial Purchasers' distribution of the Securities, any offering material in

connection with the offering and sale of the Securities other than a Preliminary

Offering Memorandum or the Offering Memorandum.

 

            (e) The Purchase Agreement and the Joinder Agreement. This Agreement

has been duly authorized, executed and delivered by, and is a valid and binding

agreement of, the Issuers and the Guarantors, enforceable in accordance with its

terms, except as rights to indemnification and contribution hereunder may be

limited by applicable law or as against public policy and except as the

enforcement hereof may be limited by bankruptcy, insolvency, fraudulent

conveyance, reorganization, moratorium or other similar laws relating to or

affecting the rights and remedies of creditors or by general equitable

principles (whether considered in a proceeding at law or in equity). At the

Closing Date, the Joinder Agreement will have been duly authorized, executed and

delivered by, and will be a valid and binding agreement of, the Guarantors

(other than the Parent), enforceable in accordance with its terms, except as

rights to indemnification and contribution hereunder may be limited by

applicable law or as against public policy and except as the enforcement thereof

may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization,

moratorium or other similar laws relating to or affecting the rights and

remedies of creditors or by general equitable principles (whether considered in

a proceeding at law or in equity).

 

            (f) The Registration Rights Agreement and DTC Agreement. At the

Closing Date, each of the Registration Rights Agreement and the DTC Agreement

will have been duly authorized, executed and delivered by, and will be a valid

and binding agreement of, the Issuers (and, in the case of the Registration

Rights Agreement, the Guarantors), enforceable in accor-

 

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dance with its terms, except as the enforcement thereof and rights thereunder

may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization,

moratorium or other similar laws relating to or affecting the rights and

remedies of creditors or by general equitable principles (whether considered in

a proceeding at law or in equity) and except as rights to indemnification under

the Registration Rights Agreement may be limited by applicable law or as against

public policy.

 

            (g) Authorization of the Securities and the Exchange Securities. The

Notes to be purchased by the Initial Purchasers from the Issuers are in the form

contemplated by the Indenture, have been duly authorized for issuance and sale

pursuant to this Agreement and the Indenture and, at the Closing Date, will have

been duly executed by the Issuers and, when authenticated in the manner provided

for in the Indenture and delivered against payment of the purchase price

therefor, will constitute valid and binding agreements of the Issuers,

enforceable in accordance with their terms, except as the enforcement thereof

and rights thereunder may be limited by bankruptcy, insolvency, fraudulent

conveyance, reorganization, moratorium or other similar laws relating to or

affecting the rights and remedies of creditors or by general equitable

principles (whether considered in a proceeding at law or in equity), or may be

limited by applicable law or as against public policy, and will be entitled to

the benefits of the Indenture. The Exchange Notes have been duly and validly

authorized for issuance by the Issuers, and when issued and authenticated in

accordance with the terms of the Indenture, the Registration Rights Agreement

and the Exchange Offer, will constitute valid and binding obligations of the

Issuers, enforceable against the Issuers in accordance with their terms, except

as the enforcement thereof and rights thereunder may be limited by bankruptcy,

insolvency, fraudulent conveyance, reorganization, moratorium, or similar laws

relating to or affecting enforcement of the rights and remedies of creditors or

by general principles of equity (whether considered in a proceeding at law or in

equity), or may be limited by applicable law or as against public policy, and

will be entitled to the benefits of the Indenture. The Guarantees of the Notes

are in the form contemplated by the Indenture and, at the Closing Date, will

have been duly authorized for issuance pursuant to this Agreement and the

Indenture and duly executed by each of the Guarantors and, when the Notes have

been authenticated in the manner provided for in the Indenture and delivered

against payment of the purchase price therefor, will constitute valid and

binding agreements of the Guarantors, enforceable in accordance with their

terms, except as the enforcement thereof may be limited by bankruptcy,

insolvency, fraudulent conveyance, reorganization, moratorium or other similar

laws relating to or affecting the rights and remedies of creditors or by general

equitable principles (whether considered in a proceeding at law or in equity),

or may be limited by applicable law or as against public policy, and will be

entitled to the benefits of the Indenture. The Guarantees of the Exchange Notes

are in the form contemplated by the Indenture and, at the Closing Date, will

have been duly and validly authorized for issuance by the Guarantors, and when

issued and authenticated in accordance with the terms of the Indenture, the

Registration Rights Agreement and the Exchange Offer, will constitute valid and

binding obligations of the Guarantors, enforceable against the Guarantors in

accordance with their terms, except as the enforcement thereof and rights

thereunder may be limited by bankruptcy, insolvency, fraudulent conveyance,

reorganization, moratorium, or similar laws relating to or affecting enforcement

of the rights and remedies of creditors or by general principles of equity

(whether considered in a

 

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proceeding at law or in equity), or may be limited by applicable law or as

against public policy, and will be entitled to the benefits of the Indenture.

 

            (h) Authorization of the Indenture. At the Closing Date, the

Indenture will have been duly authorized, executed and delivered by the Issuers

and the Guarantors and will constitute a valid and binding agreement of the

Issuers and the Guarantors, enforceable against the Issuers and the Guarantors

in accordance with its terms, except as the enforcement thereof may be limited

by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or

other similar laws relating to or affecting the rights and remedies of creditors

or by general equitable principles (whether considered in a proceeding at law or

in equity), or may be limited by applicable law or as against public policy.

 

            (i) Description of the Securities, the Indenture and the

Registration Rights Agreement. The Notes, the Exchange Notes, the Guarantees,

the guarantees of the Exchange Notes, the Indenture and the Registration Rights

Agreement will conform in all material respects to the respective statements

relating thereto contained in the Offering Memorandum.

 

            (j) No Material Adverse Change. Except as otherwise disclosed in the

Offering Memorandum, subsequent to the respective dates as of which information

is given in the Offering Memorandum: (i) there has been no material adverse

change, or any development that could reasonably be expected to (A) result in a

material adverse change, in the condition, financial or otherwise, or in the

earnings, business, operations or prospects, whether or not arising from

transactions in the ordinary course of business, of the Issuers and the

Guarantors, considered as one entity and (B) materially and adversely affect the

ability of the Issuers and the Guarantors to perform their obligations pursuant

to documents relating to the Transactions (any such change is called a "Material

Adverse Change"); (ii) the Issuers and the Guarantors, considered as one entity,

have not incurred any material liability or obligation, in any such case, other

than those incurred in connection with the Transactions, indirect, direct or

contingent, not in the ordinary course of business nor entered into any material

transaction or agreement not in the ordinary course of business; and (iii) there

has been no dividend or distribution of any kind declared, paid or made by the

Issuers, except for dividends paid to the Issuers on any class of capital stock

or repurchase or redemption by the Issuers of any class of capital stock.

 

            (k) Independent Accountants. PricewaterhouseCoopers LLP, which

expressed its opinion with respect to the combined financial statements (which

term as used in this Agreement includes the related notes thereto) included in

the Offering Memorandum, are independent certified public accountants with

respect to the Issuers under Rule 101 of the Code of Professional Conduct of the

American Institute of Certified Public Accountants, and its rulings and

interpretations.

 

            (l) Preparation of the Financial Statements. The financial

statements, together with the related notes, included in the Offering Memorandum

present fairly in all material respects the combined financial position of AMR

and EmCare and their respective subsidiaries as of and at the dates indicated

and the results of their operations and cash flows for the periods specified,

subject, in the case of interim financial statements, to year-end adjustments.

Such financial statements have been prepared in conformity with generally

accepted accounting princi-

 

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ples as applied in the United States ("GAAP"), applied on a consistent basis

throughout the periods involved, except as may be expressly stated otherwise in

the related notes thereto. The financial data set forth in the Offering

Memorandum under the captions "Offering Memorandum Summary -- Summary of

Historical Combined and Pro Forma Consolidated Financial Information and Other

Data" and "Selected Combined Financial Information and Other Data" fairly

present the information set forth therein on a basis consistent with that of the

audited and unaudited financial statements contained in the Offering Memorandum.

The pro forma consolidated financial information with respect to the Parent and

the related notes thereto included under the caption "Offering Memorandum

Summary -- Summary of Historical Combined and Pro Forma Consolidated Financial

Information and Other Data" and in "Unaudited Pro Forma Consolidated Financial

Data" in the Offering Memorandum present fairly in all material respects the

information contained therein and have been properly presented in all material

respects on the bases described therein, and the assumptions used in the

preparation thereof are reasonable and the adjustments used therein are

appropriate in all material respects to give effect to the Transactions.

 

            (m) Incorporation and Good Standing of the Issuers and the

Guarantors. Except as listed in Schedule 1(m) hereto, each of Issuers and the

Guarantors has been duly incorporated or formed and is validly existing as a

corporation, limited liability company or partnership in good standing under the

laws of the jurisdiction of its incorporation or formation and has corporate,

limited liability company or limited partnership power and authority to own,

lease and operate its properties and to conduct its business as described in the

Offering Memorandum and to enter into and perform its obligations relating to

the Transactions, including under each of this Agreement, the Joinder Agreement

(only with respect to the Guarantors, other than the Parent), the Registration

Rights Agreement, the DTC Agreement, the Securities, the Exchange Securities and

the Indenture. Each of the Issuers and the Guarantors is duly qualified as a

foreign corporation, limited liability company or partnership to transact

business and is in good standing in each jurisdiction in which such

qualification is required, whether by reason of the ownership or leasing of

property or the conduct of business, except for such jurisdictions where the

failure to so qualify or to be in good standing would not, individually or in

the aggregate, reasonably be expected to result in a Material Adverse Change.

All of the issued and outstanding capital stock of the Issuers or the Guarantors

has been duly authorized and validly issued, is fully paid and nonassessable

and, at the Closing Date with respect to the Guarantors (other than the Parent),

will be owned by an Issuer, directly or through subsidiaries of an Issuer, free

and clear of any security interest, mortgage, pledge, lien, encumbrance or

claim, other than pursuant to the Credit Documents. At the Closing Date, none of

the Issuers or any of the Guarantors will own or control, directly or

indirectly, any corporation, association or other entity other than the

subsidiaries listed in Schedule 1(m) hereto and other than the Affiliated

Medical Groups (as defined in paragraph (ee) herein).

 

            (n) Capitalization and Other Capital Stock Matters. At November 30,

2004, on a consolidated basis, after giving pro forma effect to the

Transactions, the Parent would have an authorized and outstanding capitalization

as set forth in the Offering Memorandum under the caption "Capitalization"

(other than for subsequent issuances of partnership interests, if any, pursuant

to employee benefit plans described in the Offering Memorandum).

 

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            (o) Non-Contravention of Existing Instruments; No Further

Authorizations or Approvals Required. Neither the Issuers nor any of the

Guarantors is in violation of its charter or bylaws or is in default (or, with

the giving of notice or lapse of time, would be in default) ("Default") under

any indenture, mortgage, loan or credit agreement, note, contract, franchise,

lease or other instrument to which either an Issuer or any Guarantor is a party

or by which any of them may be bound or to which any of the property or assets

of an Issuer or any Guarantor is subject (each, an "Existing Instrument"),

except for such Defaults as would not, individually or in the aggregate,

reasonably be expected to result in a Material Adverse Change. At the Closing

Date, the Issuers' and the Guarantors' execution, delivery and performance of

this Agreement, the Joinder Agreement, the Registration Rights Agreement, the

DTC Agreement and the Indenture, as applicable, and the issuance and delivery of

the Securities or the Exchange Securities, and consummation of the Transactions:

(i) will have been duly authorized by all necessary corporate or other action

and will not result in any violation of the provisions of the charter or bylaws

or partnership company agreement of the Issuers or the Guarantors, (ii) will not

conflict with or constitute a breach of, or Default or a Debt Repayment

Triggering Event (as defined below) under, or result in the creation or

imposition of any lien, charge or encumbrance upon any property or assets of the

Issuers or the Guarantors pursuant to, or require the consent of any other party

to, any Existing Instrument, except for such conflicts, breaches, Defaults,

liens, charges or encumbrances listed in Schedule 1(o) hereto or as would not,

individually or in the aggregate, reasonably be expected to result in a Material

Adverse Change, and (iii) will not result in any violation of any law,

administrative regulation or administrative or court decree applicable to the

Issuers or the Guarantors, except as would not, individually or in the

aggregate, reasonably be expected to result in a Material Adverse Change. No

consent, approval, authorization or other order of, or registration or filing

with, any court or other governmental or regulatory authority or agency is

required for the Issuers' or the Guarantors' execution, delivery and performance

of this Agreement, the Joinder Agreement, Senior Secured Credit Facility, the

Registration Rights Agreement, the DTC Agreement or the Indenture, as

applicable, or the issuance and delivery of the Securities or the Exchange

Securities, or consummation of the Transactions except such as have been

obtained or made or will be obtained or made at the Closing Date by the Issuers

or the Guarantors and are in full force and effect under the Securities Act,

applicable securities laws of the several states of the United States and

provinces of Canada and except such as may be required by the securities laws of

the several states of the United States and provinces of Canada with respect to

the Issuers' obligations under the Registration Rights Agreement and, with

respect to AMR's emergency 911 ambulance transport contracts only, except as

would not, individually or in the aggregate, reasonably be expected to result in

a Material Adverse Change. As used herein, a "Debt Repayment Triggering Event"

means any event or condition which gives, or with the giving of notice or lapse

of time would give, the holder of any note, debenture or other evidence of

indebtedness (or any person acting on such holder's behalf) the right to require

the repurchase, redemption or repayment of all or a portion of such indebtedness

by the Issuers or any of their respective subsidiaries.

 

            (p) No Material Actions or Proceedings. Except as otherwise

disclosed in the Offering Memorandum, there are no legal or governmental

actions, suits or proceedings pending or, to the best of the Issuers' and the

Guarantors' knowledge, threatened (i) against or affecting the Issuers or the

Guarantors or (ii) which have as the subject thereof any property owned or

 

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leased by the Issuers or the Guarantors and which such action, suit or

proceeding, if determined adversely to the Issuers or such subsidiary, would,

individually or in the aggregate, reasonably be expected to result in a Material

Adverse Change or adversely affect the consummation of the Transactions. Except

as otherwise disclosed in the Offering Memorandum, no material labor dispute

with the employees of the Issuers or any of the Guarantors, or with the

employees of any principal supplier of the Issuers or the Guarantors, exists or,

to the best of the Issuers' or the Guarantors' knowledge, is threatened or

imminent.

 

            (q) Intellectual Property Rights. Except as otherwise disclosed in

the Offering Memorandum, the Issuers the Guarantors own or possess sufficient

trademarks, trade names, patent rights, copyrights, licenses, approvals, trade

secrets and other similar rights (collectively, "Intellectual Property Rights")

reasonably necessary to conduct their businesses as now conducted; and the

expected expiration of any of such Intellectual Property Rights would not,

individually or in the aggregate, reasonably be expected to result in a Material

Adverse Change. Neither the Issuers nor any of the Guarantors has received any

notice of infringement or conflict with asserted Intellectual Property Rights of

others, which infringement or conflict, if the subject of an unfavorable

decision, would, individually or in the aggregate, reasonably be expected to

result in a Material Adverse Change.

 

            (r) All Necessary Permits, etc. Except as otherwise disclosed in the

Offering Memorandum, the Issuers and the Guarantors possess such valid and

current certificates, authorizations or permits issued by the appropriate state,

federal or foreign regulatory agencies or bodies necessary to conduct their

respective businesses as now conducted except as would not, individually or in

the aggregate, reasonably be expected to result in a Material Adverse Change,

and neither the Issuers nor any Guarantor has received any notice of proceedings

relating to the revocation or modification of, or non-compliance with, any such

certificate, authorization or permit which, singly or in the aggregate, if the

subject of an unfavorable decision, ruling or finding, would, individually or in

the aggregate, reasonably be expected to result in a Material Adverse Change.

 

            (s) Title to Properties. Except as otherwise disclosed in the

Offering Memorandum, at the Closing Date the Issuers and each of the Guarantors

will have good and marketable title to all the properties and assets reflected

as owned in the financial statements referred to in Section 1(l) hereof (or

elsewhere in the Offering Memorandum), in each case free and clear of any

security interests, mortgages, liens, encumbrances, equities, claims and other

defects, except pursuant to the Credit Documents and such as would not,

individually or in the aggregate, reasonably be expected to result in a Material

Adverse Change. The real property, improvements, equipment and personal property

held under lease by the Issuers or any Guarantor are held under valid and

enforceable leases, with such exceptions as would not, individually or in the

aggregate, reasonably be expected to result in a Material Adverse Change.

 

            (t) Tax Law Compliance. Except as otherwise disclosed in the

Offering Memorandum, the Issuers and the Guarantors have filed all necessary

federal, state and foreign income and franchise tax returns and have paid all

taxes required to be paid by any of them and, if due and payable, any related or

similar assessment, fine or penalty levied against any of them, except as would

not, individually or in the aggregate, reasonably be expected to result in a

Mate-

 

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rial Adverse Change. The Issuers and the Guarantors have made adequate charges,

accruals and reserves in the applicable financial statements referred to in

Section 1(l) hereof in accordance with GAAP in respect of all federal, state and

foreign income and franchise taxes for all periods as to which the tax liability

of the Issuers or any of the Guarantors has not been finally determined.

 

            (u) Each Issuer and Guarantor Not an "Investment Company". The

Issuers and the Guarantors have been advised of the rules and requirements under

the Investment Company Act of 1940, as amended (the "Investment Company Act,"

which term, as used herein, includes the rules and regulations of the Commission

promulgated thereunder). Neither Issuer nor any Guarantor is, and after receipt

of payment for the Securities neither Issuer nor any Guarantor will be, an

"investment company" within the meaning of the Investment Company Act.

 

            (v) Insurance. Except as otherwise disclosed in the Offering

Memorandum, including disclosure relating to self-insurance and liability

retention programs, each of the Issuers and the Guarantors are insured by

recognized, financially sound institutions or are insured or self-insured at

prudent and adequate levels with policies in such amounts and with such

deductibles and covering such risks as are generally deemed adequate and

customary for their businesses including, without limitation, policies covering

real and personal property owned or leased by the Issuers and their respective

subsidiaries against theft, damage, destruction, acts of vandalism and

earthquakes. None of the Issuers or any of the Guarantors has any reason to

believe that it will not be able (i) to renew its existing insurance coverage as

and when such policies expire or (ii) upon such expiration, to obtain comparable

coverage from similar institutions as may be necessary or appropriate to conduct

its business as now conducted and at a cost that would not result in a Material

Adverse Change.

 

             (w) No Price Stabilization or Manipulation. None of the Issuers or

any of the Guarantors has taken and will not take, directly or indirectly, any

action designed to or that might be reasonably expected to cause or result in

stabilization or manipulation of the price of any security of the Issuers to

facilitate the sale or resale of the Securities.

 

            (x) Solvency. Each of the Issuers and each of the Guarantors is, and

immediately after the Closing Date will be, Solvent. As used herein, the term

"Solvent" means, with respect to any person on a particular date, that on such

date (i) the fair market value of the assets of such person is greater than the

total amount of liabilities (including contingent liabilities) of such person,

(ii) the present fair salable value of the assets of such person is greater than

the amount that will be required to pay the probable liabilities of such person

on its debts as they become absolute and matured, (iii) such person is able to

realize upon its assets and pay its debts and other liabilities, including

contingent obligations, as they mature and (iv) such person does not have

unreasonably small capital.

 

            (y) Compliance with Environmental Laws. Except as would not,

individually or in the aggregate, reasonably be expected to result in a Material

Adverse Change, (i) none of the Issuers or any of the Guarantors is in violation

of any federal, state, local or foreign law or regulation relating to pollution

or protection of human health or the environment (including, without limitation,

ambient air, surface water, groundwater, land surface or subsurface strata) or

 

                                      -10-

 

<PAGE>

 

wildlife, including, without limitation, laws and regulations relating to

emissions, discharges, releases or threatened releases of chemicals, pollutants,

contaminants, wastes, toxic substances, hazardous substances, petroleum and

petroleum products (collectively, "Materials of Environmental Concern"), or

otherwise relating to the manufacture, processing, distribution, use, treatment,

storage, disposal, transport or handling of Materials of Environmental Concern

(collectively, "Environmental Laws"), which violation includes, without

limitation, noncompliance with any permits or other governmental authorizations

required for the operation of the business of the Issuers or their respective

subsidiaries under applicable Environmental Laws, or noncompliance with the

terms and conditions thereof, nor have any of the Issuers or any of their

respective subsidiaries received any written communication, whether from a

governmental authority, citizens group, employee or otherwise, that alleges that

any of the Issuers or any of their respective subsidiaries is in violation of

any Environmental Law; (ii) there is no claim, action or cause of action filed

with a court or governmental authority, no investigation with respect to which

any of the Issuers has received written notice, and no written notice by any

person or entity alleging potential liability for investigatory costs, cleanup

costs, governmental responses costs, natural resources damages, property

damages, personal injuries, attorneys' fees or penalties arising out of, based

on or resulting from the presence, or release into the environment, of any

Material of Environmental Concern at any location owned, leased or operated by

any of the Issuers or any of their respective subsidiaries, now or in the past

(collectively, "Environmental Claims"), pending or, to the best of each Issuer's

knowledge, threatened against any of the Issuers or any of their respective

subsidiaries or any person or entity whose liability for any Environmental Claim

the Issuers or any of their respective subsidiaries has retained or assumed

either contractually or by operation of law; and (iii) to the best of each

Issuer's and the Guarantors' knowledge, there are no past or present actions,

activities, circumstances, conditions, events or incidents, including, without

limitation, the release, emission, discharge, presence or disposal of any

Material of Environmental Concern, that could result in a violation of any

Environmental Law or form the basis of a potential Environmental Claim against

either of the Issuers or any of the Guarantors or against any person or entity

whose liability for any Environmental Claim any of the Issuers or any the

Guarantors has retained or assumed either contractually or by operation of law.

 

            (z) Periodic Review of Costs of Environmental Compliance. In the

ordinary course of their business, AMR and EmCare conduct a periodic review of

their compliance with Environmental Laws, in the course of which they identify

and evaluate costs and liabilities associated with such compliance. On the basis

of such review and the amount of its established reserves, the Issuers and the

Guarantors have reasonably concluded that such associated costs and liabilities

would not, individually or in the aggregate, reasonably be expected to result in

a Material Adverse Change.

 

            (aa) ERISA Compliance. Except as would not, individually or in the

aggregate, reasonably be expected to result in a Material Adverse Change, the

Issuers and the Guarantors and any "employee benefit plan" (as defined under the

Employee Retirement Income Security Act of 1974 (as amended, "ERISA," which

term, as used herein, includes the regulations and published interpretations

thereunder) established or maintained by the Issuers, the Guarantors or their

"ERISA Affiliates" (as defined below) are in compliance with ERISA. "ERISA

Affiliate" means, with respect to the Issuers or any Guarantor, any member of

any group of organizations

 

                                      -11-

 

<PAGE>

 

described in Section 414 of the Internal Revenue Code of 1986 (as amended,

"Code," which term, as used herein, includes the regulations and published

interpretations thereunder) of which the Issuers or such Guarantor is a member.

No "reportable event" (as defined under ERISA) has occurred or is reasonably

expected to occur with respect to any "employee benefit plan" established or

maintained by the Issuers, the Guarantors or any of their ERISA Affiliates. No

"employee benefit plan" established or maintained by the Issuers and the

Guarantors or any of their ERISA Affiliates, if such "employee benefit plan"

were terminated, would have any "amount of unfunded benefit liabilities" (as

defined under ERISA). No prohibited transaction, within the meaning of Section

406 of ERISA or Section 4975 of the Code, has occurred with respect to any such

plan excluding transactions effected pursuant to a statutory or administrative

exemption. Neither the Issuers, the Guarantors nor any of their ERISA Affiliates

has incurred or reasonably expects to incur any liability under (i) Title IV of

ERISA with respect to termination of, or withdrawal from, any "employee benefit

plan" or (ii) Sections 412, 4971, 4975 or 4980B of the Code. Each "employee

benefit plan" established or maintained by the Issuers and the Guarantors or any

of their ERISA Affiliates that is intended to be qualified under Section 401 of

the Code is so qualified and nothing has occurred, whether by action or failure

to act, which would cause the loss of such qualification.

 

            (bb) Compliance with Labor Laws. Except as disclosed in the Offering

Memorandum and except as would not, individually or in the aggregate, reasonably

be expected to result in a Material Adverse Change, (i) there is (A) no unfair

labor practice complaint pending or, to the best of the Issuers' and the

Guarantors' knowledge, threatened against the Issuers or any of the Guarantors

before the National Labor Relations Board, and no grievance or arbitration

proceeding arising out of or under collective bargaining agreements pending, or

to the best of the Issuers' and the Guarantors' knowledge, threatened, against

the Issuers or any of their respective subsidiaries, (B) no strike, labor

dispute, slowdown or stoppage pending or, to the best of the Issuers' knowledge,

threatened against the Issuers or any of the Guarantors and (C) no union

representation question existing with respect to the employees of the Issuers or

any of their respective subsidiaries and, to the best of the Issuers' and the

Guarantors' knowledge, no union organizing activities taking place and (ii)

there has been no violation of any federal, state or local law relating to

discrimination in hiring, promotion or pay of employees or of any applicable

wage or hour laws.

 

            (cc) Forward-Looking Statements. No forward-looking statement

(within the meaning of Section 27A of the Securities Act and Section 21E of the

Exchange Act) in the Preliminary Offering Memorandum or the Offering Memorandum

has been made without a reasonable basis or has been disclosed other than in

good faith.

 

            (dd) Statistical and Market Data. Nothing has come to the attention

of either of the Issuers that has caused such Issuer to believe that the

statistical and market-related data included in the Preliminary Offering

Memorandum and the Offering Memorandum is not based on or derived from sources

that are reliable or derived by the Issuers and the Guarantors in good faith.

 

            (ee) Compliance With Health Care Statutes, Rules and Regulations.

Except as disclosed in the Offering Memorandum or except for such violations

that would not, individually

 

                                      -12-

 

<PAGE>

 

or in the aggregate, reasonably be expected to result in a Material Adverse

Change, to either the Issuers' or any of the Guarantors' knowledge, neither of

the Issuers nor any of the Guarantors has violated any federal, state or local

health care statutes, rules or regulations, including, but not limited to, the

Federal False Claims Act, the Federal Anti-Kickback Statute, the Federal

Self-Referral Law, the Health Insurance Portability and Accountability Act of

1996, and any corresponding or similar state laws (collectively, the "Health

Care Statutes, Rules and Regulations"). Except as disclosed in the Offering

Memorandum or except for such violations which would not, individually or in the

aggregate, reasonably be expected to result in a Material Adverse Change, to the

best of the Issuers' and the Guarantors' knowledge, the Issuers, the Guarantors,

and any affiliated entity, including without limitation any professional

corporation, partnership or association, with which any of the Issuers or any of

the Guarantors contracts and through which services are provided (each, an

"Affiliated Medical Group" and collectively, the "Affiliated Medical Groups")

has received any indication or notice, written or oral, from any other federal

or state agency or authority that they have or are alleged to have acted

contrary to any Health Care Statute, Rule or Regulation. To the best of the

Issuers' and the Guarantors' knowledge and except for such violations which

would not, individually or in the aggregate, reasonably be expected to result in

a Material Adverse Change, the Issuers, the Guarantors and the Affiliated

Medical Groups are in material compliance with the laws and regulations

pertaining to (i) physician licensure, (ii) the corporate practice of medicine,

and (iii) physician fee-splitting in all states in which they operate. To the

best of the Issuers' and the Guarantors' knowledge, no Affiliated Medical Group

or any individual or business entity with which an Affiliated Medical Group

contracts has received any indication or notice, written or oral, from

representatives of the United States Department of Health and Human Services or

any other federal or state agency regarding any matters, relating to the

revocation, suspension, termination or modification of any applicable license,

certification, accreditation, supplier or provider number, or ability to

participate in any federally funded or other health care program. Issuers and

their respective subsidiaries are subject to a Compliance Program that has been

structured in light of what constitutes an effective compliance program as

defined in the United States Sentencing Commission Guidelines.

 

            (ff) Related Party Transactions. Except as disclosed on Schedule

1(ff) hereto, to the Issuers' and the Guarantors' knowledge, no relationship,

direct or indirect, exists between or among any of the Issuers or any affiliate

of the Issuers, on the one hand, and any director, executive officer, member or

stockholder of the Issuers or any affiliate of the Issuers, on the other hand,

which would be required by the Securities Act to be disclosed in a registration

statement on Form S-1 which is not so disclosed in the Offering Memorandum.

There are no outstanding loans, advances (except advances for business expenses

in the ordinary course of business) or guarantees of indebtedness by the Issuers

or any affiliate of the Issuers to or for the benefit of any of the officers or

directors of the Issuers or any affiliate of the Issuers or any of their

respective family members.

 

            (gg) No Unlawful Contributions or Other Payments. Except as would

not, individually or in the aggregate, reasonably be expected to result in a

Material Adverse Change, none of the Issuers, any Guarantor or, to the best of

the Issuers' and the Guarantors' knowledge, any employee or agent of the Issuers

or any Guarantor, has made any contribution or other pay-

 

                                      -13-

 

<PAGE>

 

ment to any official of, or candidate for, any federal, state or foreign office

in violation of any law.

 

            (hh) No Default in Senior Debt. Except as disclosed in Schedule

1(hh) hereto, no event of default exists under any material contract, indenture,

mortgage, loan agreement, note, lease or other agreement or instrument

constituting Senior Debt (as defined in the Indenture).

 

            (ii) Senior Secured Credit Facility. At the Closing Date, the Senior

Secured Credit Facility will have been duly and validly authorized by the

Issuers and the Guarantors and, when duly executed and delivered by the Issuers

and the Guarantors, will be the valid and legally binding obligation of the

Issuers and the Guarantors, enforceable in accordance with its terms, except as

the enforcement thereof and rights thereunder may be limited by bankruptcy,

insolvency, fraudulent conveyance, reorganization, moratorium or other similar

laws relating to or affecting the rights and remedies of creditors or by general

equitable principles (whether considered in a proceeding at law or in equity),

or may be limited by applicable law or as against public policy.

 

            (jj) Regulation S. The Issuers, the Guarantors and their respective

Affiliates and all persons acting on their behalf (other than the Initial

Purchasers, as to whom the Issuers and the Guarantors make no representation)

have complied with and will comply with the offering restrictions requirements

of Regulation S in connection with the offering of the Securities outside the

United States and, in connection therewith, the Offering Memorandum will contain

the disclosure required by Rule 902 thereof. The Securities sold in reliance on

Regulation S will be represented upon issuance by a temporary global security

that may not be exchanged for definitive securities until the expiration of the

40-day restricted period referred to in Rule 903 of the Securities Act and only

upon certification of beneficial ownership of such Securities by non-U.S.

persons or U.S. persons who purchased such Securities in transactions that were

exempt from the registration requirements of the Securities Act.

 

            (kk) Internal Controls. AMR and EmCare, on a consolidated basis,

maintain a system of internal accounting controls sufficient to provide

reasonable assurance that, in all material respects: (i) transactions are

executed in accordance with management's general or specific authorizations;

(ii) transactions are recorded as necessary to permit preparation of financial

statements in conformity with generally accepted accounting principles and to

maintain asset accountability; (iii) access to assets is permitted only in

accordance with management's general or specific authorization; and (iv) the

recorded accountability for assets is compared with the existing assets at

reasonable intervals and appropriate action is taken with respect to any

differences. None of the Issuers or the Targets is subject to the reporting

requirements of the Exhange Act or to Item 307 or 308 of Regulation S-K.

 

            (ll) Officer's Certificate. Any certificate signed by an officer of

the Issuers or any Guarantor and delivered to the Initial Purchasers or to

counsel for the Initial Purchasers pursuant to this Agreement shall be deemed to

be a representation and warranty by the Issuers or such Guarantor to each

Initial Purchaser as to the matters set forth therein.

 

                                      -14-

 

<PAGE>

 

            Section 2. Purchase, Sale and Delivery of the Notes.

 

            (a) The Notes. Each of the Issuers agrees to issue and sell to the

Initial Purchas