QUEST DIAGNOSTICS INCORPORATED
(a Delaware corporation)
$400,000,000 5.125% Senior Notes Due 2010
$500,000,000 5.45% Senior Notes Due 2015
PURCHASE AGREEMENT
Dated: October 25,
2005
Table of Contents
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Schedule
A
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Initial
Purchasers
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Schedule
B
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Pricing
Information
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Schedule
C
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Guarantors
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Schedule
D
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Subsidiaries
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Exhibit
A
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Form of Opinion
of Shearman & Sterling
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Exhibit
B
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Form of Opinion
of Assistant General Counsel
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and Corporate
Secretary of the Company
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Exhibit
C
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Form of Comfort
Letters
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QUEST DIAGNOSTICS INCORPORATED
(a Delaware corporation)
$400,000,000 5.125% Senior Notes due
2010
$500,000,000 5.45% Senior Notes due 2015
PURCHASE AGREEMENT
October 25, 2005
BANC OF AMERICA SECURITIES
LLC
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
MORGAN STANLEY & CO. INCORPORATED
as Representatives of the several Initial
Purchasers
c/o Banc of America Securities LLC
9 West 57 th Street
New York, NY 10019
Ladies and Gentlemen:
Quest
Diagnostics Incorporated, a Delaware corporation (the
“Company”), and each of the Guarantors listed on
Schedule C hereto (the “Guarantors”), confirm their
respective agreements with Banc of America Securities LLC
(“Banc of America”), Merrill Lynch, Pierce,
Fenner & Smith Incorporated (“Merrill Lynch”)
and Morgan Stanley & Co. Incorporated (“Morgan
Stanley”, and together with Banc of America and Merrill
Lynch, the “Joint Book-Running Managers”) and each of
the other Initial Purchasers named in Schedule A hereto
(collectively, the “Initial Purchasers,” which term
shall also include any Initial Purchaser substituted as hereinafter
provided in Section 11 hereof), for whom Banc of America
Securities LLC, Merrill Lynch and Morgan Stanley are acting as
representatives (in such capacity, the
“Representatives”), with respect to (i) the issue and
sale by the Company and the purchase by the Initial Purchasers,
acting severally and not jointly, of the respective principal
amounts set forth in said Schedule B of $400,000,000 aggregate
principal amount of the Company’s 5.125% Senior Notes due
2010 and $500,000,000 aggregate principal amount of the
Company’s 5.45% Senior Notes due 2015 (collectively, the
“Notes”) and (ii) the issue and sale by the Guarantors
and the purchase by the Initial Purchasers, acting severally and
not jointly, of the senior guarantees (the
“Guarantees”) of the Company’s obligations under
the Notes. The Notes and the Guarantees are to be issued pursuant
to an indenture dated as of June 27, 2001 (the “Base
Indenture”) among the Company, the Guarantors and Bank of New
York, as trustee (the “Trustee”), as supplemented by a
first supplemental indenture, dated as of June 27, 2001, among the
Company, as issuer, the Initial Subsidiary Guarantors party thereto
as guarantors, and the Trustee, as further supplemented by a second
supplemental indenture, dated as of November 26, 2001, among the
Company, the Subsidiary Guarantors party thereto and the Trustee,
as further supplemented by a third supplemental indenture, dated as
of April 4, 2002, among the Company, the additional Subsidiary
Guarantors party thereto and the Trustee, as further supplemented
by a fourth
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supplemental indenture, dated as
of March 19, 2003, among the Company, the additional Subsidiary
Guarantors party thereto and the Trustee, as further supplemented
by a fifth supplemental indenture, dated as of April 16, 2004,
among the Company, the additional Subsidiary Guarantor party
thereto and the Trustee and to be further supplemented by a sixth
supplemental indenture dated October 31, 2005 (the Base Indenture
together with all such supplements, the “Indenture”)
among the Company, the Subsidiary Guarantors party thereto and the
Trustee. The 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 Time (as
defined in Section 2 hereof)(the “DTC Agreement”),
among the Company, 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 October 31, 2005 (the
“Registration Rights Agreement”), among the Company,
the Guarantors and the Initial Purchasers, pursuant to which the
Company and the Guarantors will agree to file with the Commission,
under the circumstances set forth therein, (i) a registration
statement under the 1933 Act relating to another series of debt
securities of the Company with terms substantially identical to the
Notes (the “Exchange Notes”) to be offered in exchange
for the Notes (the “Exchange Offer”) and (ii) to the
extent required by the Registration Rights Agreement, a shelf
registration statement (the “Shelf Registration
Statement”) pursuant to Rule 415 of the 1933 Act relating to
the resale by certain holders of the Notes.
The
payment of principal of, premium and interest on the Notes and the
Exchange Notes will be fully and unconditionally guaranteed on a
senior unsecured basis, jointly and severally by each Guarantor,
pursuant to their “Guarantees”. 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
Company and the Guarantors 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 and
agree that the Initial Purchasers may initially resell, subject to
the conditions set forth herein, all or a portion of the Securities
to purchasers (“Subsequent Purchasers”) at any time
after the date of this Agreement. The Securities are to be sold to
the Initial Purchasers and offered and resold by the Initial
Purchasers without being registered under the Securities Act of
1933, as amended (the “1933 Act”), in reliance upon
exemptions therefrom. Pursuant to the terms of the Securities and
the Indenture, investors that acquire Securities may only resell or
otherwise transfer such Securities if such Securities are hereafter
registered under the 1933 Act or pursuant to an available exemption
from the registration requirements of the 1933 Act (including the
exemption afforded by Rule 144A (“Rule 144A”) of the
rules and regulations of the Securities and Exchange Commission
(the “Commission”) under the 1933 Act (the “1933
Act Regulations”).
The
Company has prepared and delivered to each Initial Purchaser copies
of a Preliminary Offering Memorandum, dated October 25, 2005 (the
“Preliminary Offering Memorandum”), and has prepared
and will deliver to each Initial Purchaser, copies of the Offering
Memorandum, dated October 25, 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, “Offering Memorandum” shall mean, with respect
to any date or
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time referred to in this
Agreement, the Company’s Offering Memorandum, dated October
25, 2005, including amendments or supplements thereto, any exhibits
thereto and the documents incorporated by reference therein, in the
most recent form that has been prepared and delivered by the
Company to the Initial Purchasers in connection with their
solicitation of offers to purchase Securities. Further, any
reference to the Preliminary Offering Memorandum or the Offering
Memorandum shall be deemed to refer to and include any Additional
Issuer Information (as defined in Section 3 hereof) furnished by
the Company prior to the completion of the distribution of the
Securities.
All
references in this Agreement to financial statements and schedules
and other information which is “contained,”
“included,” “stated” or
“described” in the Offering Memorandum (or other
references of like import) shall be deemed to mean and include all
such financial statements and schedules and other information which
are incorporated by reference in the Offering Memorandum; and all
references in this Agreement to amendments or supplements to the
Offering Memorandum shall be deemed to mean and include the filing
of any document under the Securities Exchange Act of 1934, as
amended (the “1934 Act”), which is incorporated by
reference in the Offering Memorandum.
SECTION 1.
Representations and Warranties .
(a)
Representations and Warranties by the Company and the
Guarantors . The Company and each of the Guarantors, jointly
and severally, represent and warrant to each Initial Purchaser as
of the date hereof and as of the Closing Time referred to in
Section 2(b) hereof, and agree with each Initial Purchaser, as
follows:
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(i)
Offering Memorandum . The preliminary offering memorandum,
as of its date, did not and the Offering Memorandum as of its date
does not, and as of the Closing Time 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 light of the
circumstances under which they were made, not misleading. The
representations and warranties in this subsection shall not apply
to statements in or omissions from the Offering Memorandum made in
reliance upon and in conformity with information furnished to the
Company and the Guarantors in writing by any Initial Purchaser
through the Representatives expressly for use in the Offering
Memorandum. Each of the preliminary Offering Memorandum and the
Offering Memorandum, as of their respective dates, contains all the
information specified in, and meeting the requirements of, Rule
144A. The Company has not distributed and will not distribute,
prior to the later of the Closing Time 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 the Preliminary Offering Memorandum or the
Offering Memorandum.
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(ii)
Incorporated Documents . The documents incorporated or
deemed to be incorporated by reference in the Offering Memorandum,
at the time they were or hereafter are filed with the Commission,
complied and will comply in all material respects with the
requirements of the 1934 Act and the rules and regulations of the
Commission thereunder (the “1934 Act Regulations”),
and, when read together with the
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other
information in the Offering Memorandum at its date and at the
Closing Time, did not and will not contain an untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading.
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(iii)
Independent Accountants . PriceWaterhouseCoopers LLP, which
certified the audited financial statements included in the Offering
Memorandum are independent public accountants, with respect to the
Company as required by the 1933 Act, the 1933 Act Regulations, the
1934 Act and the 1934 Act Regulations.
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(iv)
Financial Statements . The financial statements included or
incorporated by reference in the Offering Memorandum, together with
the related schedule and notes, present fairly (A) the financial
position of the Company and its Subsidiaries (as defined below) on
a consolidated basis at the dates indicated and (B) the statements
of operations, stockholders’ equity and cash flows of the
Company and its Subsidiaries on a consolidated basis for the
periods specified. Such financial statements have been prepared in
conformity with accounting principles generally accepted in the
United States (“GAAP”) applied on a consistent basis
throughout the periods involved. The supporting schedules, if any,
included in the Offering Memorandum present fairly in accordance
with GAAP the information required to be stated therein. The
selected financial data and the summary financial information
included in the Offering Memorandum present fairly the information
shown therein and have been compiled on a basis consistent with
that of the audited financial statements included in the Offering
Memorandum. The as adjusted information included or incorporated by
reference in the Offering Memorandum present fairly the information
shown therein, and the adjustments used therein are appropriate to
give effect to the transactions and circumstances referred to
therein. There are no historical or pro forma financial statements
required by the 1933 Act to be disclosed in a registration
statement which are not so disclosed in the Offering
Memorandum.
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(v)
No Material Adverse Change in Business . Since the
respective dates as of which information is given in the Offering
Memorandum, except as otherwise stated therein or contemplated
thereby, (A) there has been no material adverse change, in the
business, financial condition, operations, cash flow or business
prospects of the Company and its Subsidiaries, considered as one
enterprise, whether or not arising in the ordinary course of
business (a “Material Adverse Effect”) and
(B) there have been no transactions entered into by the
Company or any of its Subsidiaries, other than those described or
contemplated by the Offering Memorandum or in the ordinary course
of business, which are material with respect to the Company and its
Subsidiaries considered as one enterprise.
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(vi)
Good Standing of the Company . The Company has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Delaware and has corporate 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 under this Agreement, the
Indenture, the Registration Rights Agreement and the Securities;
and the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each other
jurisdiction
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in which such
qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result in
a Material Adverse Effect.
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(vii)
Good Standing of Subsidiaries . Each subsidiary of the
Company (each a “Subsidiary” and collectively the
“Subsidiaries”) has been duly organized and is
validly existing as a corporation, partnership or limited liability
company, as the case may be, in good standing under the laws of the
jurisdiction of its incorporation or existence, has corporate or
partnership power and authority to own, lease and operate its
properties and to conduct its business as described in the Offering
Memorandum and is duly qualified as a foreign corporation 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 where the failure so to qualify or to be in good
standing would not result in a Material Adverse Effect. Except as
otherwise disclosed in the Offering Memorandum, all of the
outstanding capital stock or partnership interests of each
Subsidiary have been duly authorized and validly issued or created,
are fully paid and non-assessable and except as described in
Schedule D are owned by the Company, directly or through the
Subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity except for pledges of
such capital stock and partnership interests that were granted
under the Amended and Restated Credit Agreement; none of the
outstanding shares of capital stock or partnership interests of the
Subsidiaries was issued in violation of any preemptive or similar
rights arising by operation of law, or under the charter, by-laws
or other charter documents of any Subsidiary or under any agreement
to which the Company or any Subsidiary is a party. All of the
Subsidiaries of the Company are listed on Schedule D attached
hereto.
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(viii)
Authorization of this Agreement and the Registration Rights
Agreement . This Agreement has been, and at or prior to the
Closing Time, the Registration Rights Agreement will have been,
duly authorized, executed and delivered by, and each such agreement
will be a valid and biding agreement of, the Company and each of
the Guarantors party thereto, enforceable in accordance with its
terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors’ rights
generally and except as enforcement thereof is subject to general
principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law).
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(ix)
Authorization and Description of the Indenture . The Base
Indenture and each supplemental indenture thereto have all been
duly authorized, executed and delivered by the Company and each of
the Guarantors and constitute valid and binding agreements of the
Company and each of the Guarantors, enforceable against the Company
and each of the Guarantors in accordance with their terms, except
as the enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors’ rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law). The Sixth Supplemental Indenture has
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been duly
authorized by the Company and each of the Guarantors and, when duly
executed and delivered by the Company and each of the Guarantors,
will constitute a valid and binding agreement of the Company and
each of the Guarantors, enforceable against the Company and each of
the Guarantors in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors’ rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law).
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(x)
Authorization of the Notes, the Guarantees and the Exchange
Notes . The Notes to be purchased by the Initial Purchasers
from the Company have been duly authorized for issuance and sale to
the Initial Purchasers pursuant to this Agreement and, at the
Closing Time, will have been duly executed by the Company and, when
authenticated, issued and delivered in the manner provided for in
the Indenture and delivered against payment of the purchase price
therefor as provided in this Agreement, will constitute valid and
binding obligations of the Company, enforceable against the Company
in accordance with their terms, except as the enforcement thereof
may be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or similar laws affecting enforcement of
creditors’ rights generally and except as enforcement thereof
is subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law), and
will be in the form contemplated by, and entitled to the benefits
of, the Indenture. The Exchange Notes have been duly and validly
authorized for issuance by the Company, 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 Company,
enforceable against the Company in accordance with their terms,
except as the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws
affecting enforcement of creditors’ rights generally and
except as enforcement thereof is subject to general principles of
equity (regardless of whether enforcement is considered in a
proceeding in equity or at law) and will be entitled to the
benefits of the Indenture. The Guarantees of the Notes and the
Exchange Notes have been duly authorized by the Guarantors and,
when executed and delivered in the manner provided for in the
Indenture, will constitute valid and binding obligations of the
Guarantors, enforceable against the Guarantors in accordance with
their terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors’ rights
generally and except as enforcement thereof is subject to general
principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law), and will be in the
form contemplated by, and entitled to the benefits of, the
Indenture.
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(xi)
Description of the Securities, the Exchange Securities, the
Indenture and the Registration Rights Agreement . The
description of the Securities, the Exchange Securities, the
Indenture and the Registration Rights Agreement set forth in the
Offering Memorandum are correct and complete in all material
respects.
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(xii)
Non-Guarantor Subsidiaries . Each Subsidiary that is a
guarantor under the Amended and Restated Credit Agreement, is a
Guarantor. All Subsidiaries that are not Guarantors (other than
Quest Diagnostics Receivables Incorporated) did not collectively
(a) own more than 10% of the Company’s consolidated assets at
December 31, 2004 or (b) account for more than 6% of the
Company’s consolidated revenues for the year ended December
31, 2004.
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(xiii)
Absence of Defaults and Conflicts . Neither the Company nor
any of the Subsidiaries is in violation of its charter or by-laws
or in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note,
lease or other agreement or instrument to which the Company or any
of the Subsidiaries is a party or by which any of them may be
bound, or to which any of the property or assets of the Company or
any of the Subsidiaries is subject (collectively, “Agreements
and Instruments”) or has violated or is in violation of
any of the laws, rules and regulations administered by the United
States Centers for Medicare and Medicaid Services
(“CMS”), the United States Food and Drug Administration
(the “FDA”), the Substance Abuse and Mental Health
Services Administration (the “SAMHSA”) and by the Drug
Enforcement Administration (the “DEA”), or any other
applicable law, statute, rule, regulation, judgment, order, writ or
decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over the Company or any of
the Subsidiaries or any of their assets or properties, except in
each case for such defaults or violations that have been disclosed
or that would not singly or in the aggregate result in a Material
Adverse Effect. The execution, delivery and performance of this
Agreement, the Registration Rights Agreement, the Indenture, the
Securities, the Exchange Securities and the Guarantees and any
other agreement or instrument entered into or issued or to be
entered into or issued by the Company or any of the Guarantors in
connection with the consummation of the transactions contemplated
by this Agreement herein and in the Offering Memorandum (including
the issuance and sale of the Securities and the Guarantees, the use
of the proceeds from the sale of the Securities and the Guarantees
as described in the Offering Memorandum under the caption
“Use of Proceeds”) and compliance by the Company and
the Guarantors with their respective obligations under this
Agreement, the Registration Rights Agreement, the Indenture, the
Securities and the Guarantees have been duly authorized by all
necessary corporate action and do not and will not, whether with or
without the giving of notice or passage of time or both, conflict
with or constitute a breach of, or a default under, or result in
the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of the Subsidiaries
pursuant to, the Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances
that, singly or in the aggregate, would not result in a Material
Adverse Effect), nor will such action result in any violation of
the provisions of the charter or by-laws of the Company or any of
the Subsidiaries or any applicable law, statute, rule, regulation,
judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction
over the Company or any of the Subsidiaries or any of their assets,
properties or operations.
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(xiv)
Absence of Labor Disputes . No labor dispute with the
employees of the Company or any of the Subsidiaries exists or, to
the knowledge of the Company and the Guarantors, is imminent, which
may reasonably be expected to result in a Material Adverse
Effect.
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(xv)
Absence of Proceedings . Except as disclosed in the Offering
Memorandum or the documents incorporated by reference thereto,
there is not pending or, to the knowledge of the Company or any
Guarantor, threatened any action, suit, proceeding, inquiry or
investigation, to which the Company or any Subsidiary is a party,
or to which the property of the Company or any Subsidiary is
subject, before or brought by any domestic or foreign court or
governmental agency or body, affecting (i) the possession by any of
them of any Governmental Authorization (as defined herein)
currently held by any them, (ii) the accreditation of any of their
respective laboratories with the College of American Pathologists
(“CAP”), (iii) any of their qualification to perform
services for and receive reimbursement from, Medicaid, Medicare,
TRICARE or CHAMPUS (iv) any of their ability to conduct their
clinical testing business in any state or (v) any of them in any
other way, which in the case of any of the foregoing, might
reasonably be expected to result in a Material Adverse Effect, or
which might reasonably be expected to materially and adversely
affect the properties or assets of the Company and the Subsidiaries
considered as one enterprise or the consummation of the
transactions contemplated in this Agreement or the performance by
the Company of its obligations hereunder or under the Indenture,
the Registration Rights Agreement, the Securities, the Exchange
Securities or the Guarantees. The aggregate of all pending legal or
governmental proceedings to which the Company or any Subsidiary
thereof is a party or of which any of their respective property or
assets is the subject which are not described in the Offering
Memorandum or the documents incorporated by reference thereto,
including ordinary routine litigation incidental to the business,
could not reasonably be expected to result in a Material Adverse
Effect. All of the descriptions set forth in the Offering
Memorandum or the documents incorporated by reference thereto, of
the legal and governmental proceedings by or before any court,
governmental agency or body are true and accurate in all material
respects.
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(xvi)
Accuracy of Exhibits . There are no contracts or documents
which are required to be described in the Offering Memorandum or
the documents incorporated by reference therein or to be filed as
exhibits thereto which have not been so described and filed as
required.
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(xvii)
Possession of Intellectual Property . The Company and the
Subsidiaries own, possess or license, or can acquire on reasonable
terms, adequate patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information,
systems or procedures), trademarks, service marks, trade names or
other intellectual property (collectively, “Intellectual
Property”) necessary to carry on the business now
operated by them, and neither the Company nor any of the
Subsidiaries has received any notice or is otherwise aware of any
infringement of or conflict with asserted rights of others with
respect to any Intellectual Property (including Intellectual
Property which is licensed) or of any facts or circumstances
which would render any Intellectual Property invalid or
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inadequate to
protect the interest of the Company or any of the Subsidiaries
therein, and which infringement or conflict or invalidity or
inadequacy, singly or in the aggregate, would reasonably be
expected to result in a Material Adverse Effect.
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(xviii)
Absence of Further Requirements . Assuming compliance by the
Initial Purchasers with the representations and warranties set
forth in Section 2 and compliance with the transfer restrictions
set forth in Section 6 parties other than the Company or the
Guarantors, no filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court
or governmental authority or agency is necessary or required (i)
for the performance by the Company or any of the Guarantors of
their respective obligations hereunder, (ii) in connection with the
offering, issuance or sale of the Securities and the Guarantees
under this Agreement or the consummation of the transactions
contemplated by this Agreement or (iii) for the due execution,
delivery or performance by the Company or any of the Guarantors of
this Agreement, the Registration Rights Agreement, the Indenture,
the Securities, the Guarantees or any other agreement or instrument
entered into or issued or to be entered into or issued by the
Company or any of the Subsidiaries in connection with the
consummation of the transactions contemplated herein and in the
Offering Memorandum (including the issuance and sale of the
Securities and the use of proceeds from the sale of the Securities
as described in the Offering Memorandum under the caption
“Use of Proceeds”), except such as have been already
obtained or as may be required under the 1933 Act or the 1933 Act
Regulations in connection with the transactions contemplated by the
Registration Rights Agreement or state securities laws and except
such where the failure to obtain would not result in a Material
Adverse Effect.
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(xix)
Possession of Licenses, Provider Agreements and Permits .
The Company and the Subsidiaries possess all governmental permits,
licenses, provider numbers and agreements, approvals, consents,
certificates and other authorizations required (i) under the
Medicare, Medicaid, TRICARE and CHAMPUS programs, (ii) under the
Clinical Laboratories Improvement Act of 1967, as amended (the
“CLIA”), (iii) by the SAMHSA and (iv) as otherwise
necessary to conduct the business now operated by them
respectively, issued by CMS, the FDA, the SAMHSA and each other
appropriate federal, state, local or foreign regulatory agencies or
bodies including, but not limited to, any foreign regulatory
authorities performing functions similar to their respective
functions (“Governmental Authorizations”) except where
failure to obtain such Governmental Authorizations would not singly
or in the aggregate, result in a Material Adverse Effect; the
Company and the Subsidiaries are in compliance with the terms and
conditions of all such Governmental Authorizations and with the
rules and regulations of the regulatory authorities and governing
bodies having jurisdiction with respect thereto, except where the
failure so to comply would not, singly or in the aggregate, have a
Material Adverse Effect; all of the Governmental Authorizations are
valid and in full force and effect, except when the invalidity of
such Governmental Authorizations or the failure of such
Governmental Authorizations to be in full force and effect would
not have a Material Adverse Effect; and neither the Company nor any
of the Subsidiaries has received any notice of proceedings relating
to the revocation or modification of any such Governmental
Authorizations, nor are there, to the knowledge of the Company or
any Guarantor, pending or threatened actions, suits, claims or
proceedings against the
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Company or any
Subsidiary before any court, governmental agency or body including,
but not limited to, CMS, the FDA, and the SAMHSA or otherwise that
would reasonably be expected to limit, revoke, cancel, suspend or
cause not to be renewed any Governmental Authorizations, in each
case, which, singly or in the aggregate, would result in a Material
Adverse Effect.
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(xx)
Licensing and Accreditation of Laboratories . All of the
regional laboratories of the Company and the Subsidiaries are
eligible for accreditation by CAP and are so accredited, and all of
the laboratories of the Company and the Subsidiaries are in
compliance, in all material respects, with the standards required
by CLIA.
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(xxi)
Title to Property . The Company and the Subsidiaries have
valid title to all real property owned by the Company and the
Subsidiaries and good title to all other properties owned by them,
in each case, free and clear of all mortgages, pledges, liens,
security interests, claims, restrictions or encumbrances of any
kind except such as (a) are described in the Offering
Memorandum and reflected in the financial statements included
therein; (b) are granted or created under the Amended and
Restated Credit Agreement or (c) do not, singly or in the
aggregate, materially affect the value of such property and do not
interfere with the use made and proposed to be made of such
property by the Company or any of the Subsidiaries; and all of the
leases and subleases material to the business of the Company and
the Subsidiaries, considered as one enterprise, and under which the
Company or any of the Subsidiaries holds properties described in
the Offering Memorandum, are in full force and effect. Except as
described in the Offering Memorandum, neither the Company nor any
of the Subsidiaries has any notice of any claim of any sort that
has been asserted by anyone adverse to the rights of the Company or
any of the Subsidiaries under any of the leases or subleases
mentioned above, or affecting or questioning the rights of the
Company or any Subsidiary to the continued possession of the leased
or subleased premises under any such lease or sublease, which,
singly or in the aggregate, would result in a Material Adverse
Effect.
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(xxii)
Insurance . The Company and the Subsidiaries carry or are
entitled to the benefits of insurance, including, without
limitation, professional liability insurance, with financially
sound and reputable insurers, in such amounts, containing such
deductibles and covering such risks as is reasonable and prudent in
the view of the Company.
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(xxiii)
Environmental Laws . Except for such matters as would not,
singly or in the aggregate, result in a Material Adverse Effect,
(A) neither the Company nor any of the Subsidiaries is in
violation of any federal, state, local or foreign statute, law,
rule, regulation, ordinance, code, policy or rule of common law or
any judicial or administrative interpretation thereof, including
any judicial or administrative order, consent, decree or judgment,
relating to pollution or protection of human health, the
environment (including, without limitation, ambient air, surface
water, groundwater, land surface or subsurface strata) or wildlife,
including, without limitation, laws and regulations relating to the
release or threatened release of chemicals, pollutants,
contaminants, wastes, toxic substances, hazardous substances,
medical specimens, petroleum or petroleum products or nuclear or
radioactive material (collectively,
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“Hazardous Materials”) or to the
manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous Materials
(collectively, “Environmental Laws”), (B) the
Company and the Subsidiaries have all permits, licenses,
authorizations and approvals currently required for their
respective businesses under any applicable Environmental Laws and
are each in compliance with their requirements, (C) there are
no pending or threatened administrative, regulatory or judicial
actions, suits, demands, demand letters, claims, liens, notices of
noncompliance or violation, investigation or proceedings relating
to any Environmental Law against the Company or any of the
Subsidiaries and (D) there are no events, facts or
circumstances that might reasonably be expected to form the basis
of any liability or obligation of the Company or any of the
Subsidiaries, including, without limitation, any order, decree,
plan or agreement requiring clean-up or remediation, or any action,
suit or proceeding by any private party or governmental body or
agency, against or affecting the Company or any of the Subsidiaries
relating to any Hazardous Materials or Environmental
Laws.
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(xxiv)
Registration Rights . Except as disclosed in the Offering
Memorandum or the documents incorporated by reference therein,
there are no holders of securities (debt or equity) of the Company,
or holders of rights (including, without limitation, preemptive
rights), warrants or options to obtain securities of the Company,
who in connection with the issuance, sale and delivery of the
Securities and the Guarantees, and the execution, delivery and
performance of this Agreement, have the right to request the
Company to register securities held by them under the 1933
Act.
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(xxv)
Compliance with Sarbanes-Oxley . There is and has been no
failure on the part of the Company and its subsidiaries and their
respective officers and directors to comply with the applicable
provisions of the Sarbanes-Oxley Act of 2002 (the
“Sarbanes-Oxley Act,” which term, as used herein,
includes the rules and regulations of the Commission promulgated
thereunder).
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(xxvi)
Accounting Controls . The Company and its consolidated
Subsidiaries maintain a system of internal accounting controls that
is in compliance with the Sarbanes-Oxley Act and is sufficient to
provide reasonable assurances that (A) transactions are
executed in accordance with management’s general or specific
authorization; (B) transactions are recorded as necessary to
permit preparation of financial statements in conformity with GAAP
and to maintain accountability for assets; (C) access to
assets is permitted only in accordance with management’s
general or specific authorization; and (D) the recorded
accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect
to any differences.
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(xxvii)
Investment Company Act . The Company and each of the
Guarantors are not, and will not be as a result of the sale of the
Securities and the Guarantees pursuant to this Agreement, an
investment company within the meaning of the Investment Company Act
of 1940, as amended.
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(xxviii)
Similar Offering . Neither the Company nor any of its
affiliates or any person acting on its or any of their behalf
(other than the Initial Purchasers, as to whom the Company makes no
representation or warranty), as such term is defined in
Rule
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501(b) under
the 1933 Act (each, an “Affiliate”), has, directly or
indirectly, solicited any offer to buy, sold or offered to sell or
otherwise negotiated in respect of, or will solicit any offer to
buy, sell or offer to sell or otherwise negotiate in respect of, in
the United States or to any United States citizen or resident, any
security which is or would be integrate
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