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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 1, 2001
REGISTRATION NO. 333-54310
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 5
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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QUEST DIAGNOSTICS INCORPORATED
(EXACT NAME OF EACH REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 8071 16-1387862
(STATE OR OTHER JURISDICTION OF (PRIMARY STANDARD INDUSTRIAL (IRS EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBERS)
QUEST DIAGNOSTICS INCORPORATED
ONE MALCOLM AVENUE
TETERBORO, NEW JERSEY 07608
(201) 393-5000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF REGISTRANTS' PRINCIPAL EXECUTIVE OFFICES)
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LEO C. FARRENKOPF, JR., ESQ.
QUEST DIAGNOSTICS INCORPORATED
VICE PRESIDENT AND SECRETARY
ONE MALCOLM AVENUE
TETERBORO, NEW JERSEY 07608
(201) 393-5000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE OF EACH REGISTRANT)
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SEE TABLE OF ADDITIONAL REGISTRANTS
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WITH COPIES TO:
STEPHEN T. GIOVE, ESQ. STUART H. GELFOND, ESQ.
SHEARMAN & STERLING FRIED, FRANK, HARRIS, SHRIVER & JACOBSON
599 LEXINGTON AVENUE ONE NEW YORK PLAZA
NEW YORK, NEW YORK 10022 NEW YORK, NEW YORK 10004
(212) 848-4000 (212) 859-8000
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after this registration statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended, other than securities offered only in connection with dividend
or interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
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PROPOSED PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO MAXIMUM OFFERING AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED BE REGISTERED(1) PRICE PER UNIT(1) OFFERING PRICE(1) REGISTRATION FEE
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PRIMARY OFFERING:
Debt securities of Quest Diagnostics(3)(7).......
Preferred stock of Quest Diagnostics(4)(7).......
Common stock of Quest Diagnostics(5)(7).......... (2) (2) (2)
Guarantees of Debt Securities of Quest
Diagnostics(6).................................
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Total............................................ $600,000,000 100% $600,000,000 (8)
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SECONDARY OFFERING:
Common stock of Quest Diagnostics(9)............. 3,000,000 (10)
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(Footnotes on next page)
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(1) We will determine the proposed maximum offering price per unit from time to
time in connection with issuances of securities registered hereunder. The
proposed maximum aggregate offering price has been estimated solely for the
purpose of calculating the registration fee pursuant to Rule 457 under the
Securities Act.
(2) Not applicable pursuant to General Instruction II.D of Form S-3.
(3) There is being registered hereunder an indeterminate principal amount of
debt securities of our company as may be offered or sold from time to time
by us. If any debt securities are issued at an original issue discount,
then the offering price shall be in such greater principal amount as shall
result in an aggregate initial offering price not to exceed $600,000,000.
(4) There is being registered hereunder an indeterminate number of shares of
our preferred stock as may be sold from time to time by us.
(5) There is being registered hereunder an indeterminate number of shares of
our common stock as may be sold from time to time by us. This includes the
associated rights to purchase our Series A Junior Participating Preferred
Stock. The rights to purchase our Series A Junior Participating Preferred
Stock initially are attached to and trade with the shares of our common
stock being registered hereby.
(6) Registrants listed on the Table of Additional Registrants will fully,
irrevocably and unconditionally guarantee on an unsecured basis our debt
securities. Pursuant to Rule 457(n), no separate fee is required to be paid
in respect of guarantees of our debt securities, that are being registered
concurrently.
(7) Includes such indeterminate amount of debt securities, preferred stock and
common stock of our company as may be issued upon conversion or exchange
for any other securities registered hereunder that provide for conversion
or exchange into debt securities, preferred stock or common stock of our
company.
(8) Registration fee of $150,000 was previously paid by registrant.
(9) The selling shareholder, SmithKline Beecham plc, previously filed to
register 1,500,000 shares of common stock of our company. As a result of a
two-for-one stock split we effected on May 31, 2001, the selling
shareholder now may offer a maximum of 3,000,000 shares of common stock of
our company. This includes the associated rights to purchase our Series A
Junior Participating Preferred Stock. The rights to purchase our Series A
Junior Participating Preferred Stock initially are attached to and trade
with the shares of our common stock being registered hereby.
(10) Registration fee of $36,750 was previously paid by registrant.
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TABLE OF ADDITIONAL REGISTRANTS
STATE OR OTHER PRIMARY STANDARD
JURISDICTION OF INDUSTRIAL I.R.S. EMPLOYER
INCORPORATION OR CLASSIFICATION CODE IDENTIFICATION
NAME ORGANIZATION NUMBER NUMBER
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Quest Diagnostics Holdings Incorporated....... DE 8071 23-2324658
Quest Diagnostics Clinical Laboratories, DE 8071 38-2084239
Inc. .......................................
Quest Diagnostics Incorporated................ CA 8071 95-2701802
Quest Diagnostics Incorporated................ MD 8071 52-0890739
Quest Diagnostics LLC......................... IL 8071 36-4257926
Quest Diagnostics Incorporated................ MI 8071 38-1882750
Quest Diagnostics Incorporated................ CT 8071 06-1460613
Quest Diagnostics Incorporated................ MA 8071 04-3248020
Quest Diagnostics of Pennsylvania Inc. ....... DE 8071 22-3137283
Quest Diagnostics Incorporated................ OH 8071 34-0944454
MetWest Inc. ................................. DE 8071 33-0363116
Nichols Institute Diagnostics................. CA 8071 95-2955451
DPD Holdings, Inc............................. DE 8071 93-0988106
Diagnostics Reference Services Inc............ MD 8071 22-3479439
Laboratory Holdings Incorporated.............. MA 8071 04-2449994
Pathology Building Partnership................ MD 8071 51-1188454
Quest Diagnostics Investments Incorporated.... DE 8731 51-0314231
Quest Diagnostics Finance Incorporated........ DE 8071 51-0390719
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PROSPECTUS
QUEST DIAGNOSTICS INCORPORATED
DEBT SECURITIES
GUARANTEES OF DEBT SECURITIES
PREFERRED STOCK
COMMON STOCK
[LOGO]
We may offer and sell, from time to time, in one or more offerings, up to
$600,000,000 of any combination of the debt and equity securities we describe in
this prospectus. If we decide to offer and sell our common stock, SmithKline
Beecham plc may also use this prospectus to offer and sell up to 3 million
shares of our common stock owned by it. We will not receive any proceeds from
the sale of our common stock by SmithKline Beecham plc.
Our debt securities may be fully and unconditionally guaranteed on an
unsecured basis by our subsidiaries as described in "Description of Debt
Securities -- Guarantees."
We will provide the specific terms of these securities in supplements to
this prospectus. This prospectus may not be used to sell securities unless
accompanied by a prospectus supplement. WE URGE YOU TO READ CAREFULLY THIS
PROSPECTUS AND THE ACCOMPANYING PROSPECTUS SUPPLEMENT, WHICH WILL DESCRIBE THE
SPECIFIC TERMS OF THE SECURITIES OFFERED, BEFORE YOU MAKE YOUR INVESTMENT
DECISION.
Our common stock trades on the New York Stock Exchange under the symbol
"DGX."
INVESTING IN OUR COMMON STOCK, PREFERRED STOCK OR DEBT SECURITIES INVOLVES
RISKS, SEE "RISK FACTORS" BEGINNING ON PAGE 1.
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Neither the Securities and Exchange Commission nor any other regulatory
body has approved or disapproved of these securities or passed upon the adequacy
or accuracy of this prospectus. Any representation to the contrary is a criminal
offense.
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The date of this prospectus is June 1, 2001
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TABLE OF CONTENTS
PAGE
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ABOUT THIS PROSPECTUS....................................... ii
QUEST DIAGNOSTICS INCORPORATED.............................. ii
RISK FACTORS................................................ 1
RATIO OF EARNINGS TO FIXED CHARGES AND EARNINGS TO COMBINED
FIXED CHARGES AND PREFERRED STOCK DIVIDENDS............... 9
USE OF PROCEEDS............................................. 9
WHERE YOU CAN FIND MORE INFORMATION......................... 10
FORWARD-LOOKING STATEMENTS.................................. 11
SECURITIES WE MAY ISSUE..................................... 12
DESCRIPTION OF DEBT SECURITIES.............................. 16
DESCRIPTION OF THE PREFERRED STOCK AND THE DEPOSITARY SHARES
REPRESENTING FRACTIONAL SHARES OF PREFERRED STOCK......... 28
DESCRIPTION OF COMMON STOCK................................. 33
SELLING STOCKHOLDER......................................... 36
PLAN OF DISTRIBUTION........................................ 37
VALIDITY OF THE SECURITIES.................................. 38
INDEPENDENT ACCOUNTANTS..................................... 38
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ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
Securities and Exchange Commission (the "SEC") using the SEC's shelf
registration rules. Under the shelf registration rules, using this prospectus,
together with a prospectus supplement, we may sell from time to time, in one or
more offerings, up to $600,000,000 of any of the securities described in this
prospectus. SmithKline Beecham may use this prospectus to offer and sell our
common stock that it owns as described in "Selling Stockholder" only as part of
an underwritten public offering. In December 2000, Glaxo Wellcome and SmithKline
Beecham merged to form GlaxoSmithKline plc.
In this prospectus we use the terms "Quest Diagnostics," "we," "us," and
"our" to refer to Quest Diagnostics Incorporated, a Delaware corporation.
This prospectus provides you with a general description of the securities
we may sell and the common stock that SmithKline Beecham may sell. Each time we
sell securities under this prospectus, we will provide a prospectus supplement
that will contain specific information about the terms of that offering. The
prospectus supplement may also add, update or change information contained in
this prospectus. You should read this prospectus, the applicable prospectus
supplement and the additional information described below under "Where You Can
Find More Information."
QUEST DIAGNOSTICS INCORPORATED
We are the nation's leading provider of diagnostic testing and related
services for the healthcare industry. We offer a broad range of clinical
laboratory testing services to physicians, hospitals, managed care
organizations, employers, governmental institutions and other independent
clinical laboratories. We have the leading market share in clinical laboratory
testing and esoteric testing, including molecular diagnostics, as well as
anatomic pathology services and testing for drugs of abuse. Esoteric tests are
those tests that are performed less frequently than routine tests and require
more sophisticated equipment and materials, professional "hands-on" attention
and more highly skilled personnel to perform and analyze results.
We currently process over 100 million requisitions each year. Each
requisition form accompanies a patient specimen, indicating the tests to be
performed and the party to be billed for the tests. Our national network of
laboratories and patient service centers is more extensive than those of our
competitors, with principal laboratories located in approximately 30 major
metropolitan areas throughout the United States, several joint venture
laboratories, approximately 150 smaller "rapid response" laboratories and
approximately 1,300 patient service centers. We also operate a leading esoteric
testing laboratory and development facility known as Nichols Institute located
in San Juan Capistrano, California as well as laboratory facilities in Mexico
City, Mexico and near London, England.
In addition to our laboratory testing business, our clinical trials
business is one of the leading providers of testing to support clinical trials
of new pharmaceuticals worldwide. We also collect and analyze laboratory,
pharmaceutical and other data through our Quest Informatics division in order to
help pharmaceutical companies with their marketing and disease management
efforts, as well as to help healthcare customers better manage the health of
their patients.
Our company is a Delaware corporation. Our principal executive offices are
located at One Malcolm Avenue, Teterboro, New Jersey 07608, and our telephone
number is (201) 393-5000.
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RISK FACTORS
You should carefully consider the risks described below before making a
decision to invest in our securities. Some of the following factors relate
principally to our business and the industry in which we operate. Other factors
relate principally to your investment in our securities. The risks and
uncertainties described below are not the only ones facing our company.
Additional risks and uncertainties not presently known to us or that we
currently deem immaterial may also adversely affect our business and operations.
If any of the matters included in the following risks were to occur, our
business, financial condition, results of operations, cash flows or prospects
could be materially adversely affected. In such case, the trading price of our
common stock could decline and you could lose all or part of your investment.
INTEGRATING OUR BUSINESS OPERATIONS WITH THOSE BUSINESSES THAT WE HAVE ACQUIRED
OR MAY ACQUIRE IN THE FUTURE MAY BE DIFFICULT AND MAY HAVE A MATERIAL ADVERSE
IMPACT ON OUR BUSINESS
We are in the process of integrating into our company the operations of
SmithKline Beecham Clinical Laboratories, Inc., or SBCL, which we acquired in
August 1999. While we have substantially completed the transition of our
business affected by this integration, including consolidation of redundant
facilities and infrastructure and administrative and other duplicative
functions, certain other activities, such as standardization of information
systems, will continue beyond 2001. Given the large size of SBCL's operations
and the complexity of the clinical laboratory testing business, we expect that
it will take as long as three years from the date of this prospectus before we
fully complete the process. In addition, in February 2001 we acquired the assets
of Clinical Laboratories of Colorado. We may also acquire additional clinical
laboratories in the future as part of our growth strategy. Each of these
acquisitions involves the integration of separate companies that have previously
operated independently and have different corporate cultures. The process of
combining such companies may be disruptive to their businesses and may cause an
interruption of, or a loss of momentum in, such businesses as a result of the
following difficulties, among others:
- loss of key customers or employees;
- inconsistencies in standards, controls, procedures and policies among the
companies being combined make it more difficult to implement and
harmonize company-wide financial, accounting, billing, information and
other systems;
- failure to maintain the quality of services that such companies have
historically provided;
- coordination of geographically diverse organizations; and
- diversion of management's attention from the day-to-day business of our
company as a result of the need to deal with the above disruptions and
difficulties and the added costs of dealing with such disruptions.
In particular, since most of our clinical laboratory testing is performed under
arrangements that are terminable at will or on short notice, any such
interruption of or deterioration in our services may result in a customer's
decision to stop using us for clinical laboratory testing.
OUR ACQUISITIONS MAY NOT PRODUCE THE ANTICIPATED BENEFITS
Even if we are able to successfully integrate the operations of SBCL into
our company, or the operations of other companies or businesses we may acquire
in the future, we may not be able to realize the full benefits that we currently
expect to result from such integration, either at all or in a timely manner.
Overall, we expect that the integration of SBCL will result in approximately
$150 million in annual synergies, to be achieved by the end of 2002. For the
year ended December 3l, 2000, we estimated that we achieved approximately $50
million of these synergies. However, we may not continue to realize these
synergies or we may not realize any of the additional anticipated benefits,
either at all or in a timely manner.
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FAILURE TO TIMELY OR ACCURATELY BILL FOR OUR SERVICES COULD HAVE A MATERIAL
ADVERSE IMPACT ON OUR NET REVENUES AND BAD DEBT EXPENSE
Billing for laboratory services is extremely complicated. Laboratories must
bill various payers, such as patients, insurance companies, Medicare, Medicaid,
physicians and employer groups, all of which have different billing
requirements. In addition, auditing for compliance with applicable laws and
regulations as well as internal compliance policies and procedures adds further
complexity to the billing process. Among many other factors complicating billing
are:
- pricing differences between our fee schedules and the reimbursement rates
of the payers;
- disputes with payers as to which party is responsible for payment; and
- disparity in coverage among various carriers.
We believe that most of our bad debt expense, which was 7% of our net
revenues in 2000, is the result of several non-credit-related issues, primarily
missing or incorrect billing information on requisitions received from
healthcare providers. In general, we perform the requested tests and report test
results regardless of whether the billing information is incorrect or missing.
We subsequently attempt to contact the provider to obtain any missing
information or rectify incorrect billing information. Missing or incorrect
information on requisitions adds complexity to and slows the billing process,
creates backlogs of unbilled requisitions, and generally increases the aging of
accounts receivable. When all issues relating to the missing or incorrect
information are not resolved in a timely manner, the related receivables are
written-off to the allowance for doubtful accounts.
FAILURE IN OUR INFORMATION TECHNOLOGY SYSTEMS, INCLUDING FAILURES RESULTING FROM
OUR SYSTEMS CONVERSIONS, COULD SIGNIFICANTLY INCREASE TURN-AROUND TIME AND
OTHERWISE DISRUPT OUR OPERATIONS, WHICH COULD REDUCE OUR CUSTOMER BASE AND
RESULT IN LOST NET REVENUES
Our success depends, in part, on the continued and uninterrupted
performance of our information technology, or IT, systems. Our computer systems
are vulnerable to damage from a variety of sources, including telecommunications
failures, malicious human acts and natural disasters. Moreover, despite network
security measures, some of our servers are potentially vulnerable to physical or
electronic break-ins, computer viruses and similar disruptive problems. Despite
the precautions we have taken, unanticipated problems affecting our systems
could cause failures in our IT systems. Sustained or repeated system failures
that interrupt our ability to process test orders, deliver test results or
perform tests in a timely manner would adversely affect our reputation and
result in a loss of customers and net revenues.
In addition, we are in the process of standardizing our systems as a result
of the SBCL acquisition, which process is difficult and will take several years
to complete. SBCL had standardized billing and laboratory information systems
throughout its laboratory network, which are different from our existing
systems. We plan to begin to develop and implement a new laboratory information
system and a new billing system that combine the functionality of the existing
systems of Quest Diagnostics and SBCL. We expect that the development and
implementation of the new systems will take several years. During systems
conversions of this type, workflow may be temporarily interrupted, which may
cause backlogs. In addition, the implementation process, including the
transferring of databases and master files to new data centers, presents
significant conversion risks which could cause failures in our IT systems and
disrupt our operations.
THE DEVELOPMENT OF NEW, MORE COST-EFFECTIVE TESTS THAT CAN BE PERFORMED BY
PHYSICIANS IN THEIR OFFICES OR BY PATIENTS COULD NEGATIVELY IMPACT OUR TESTING
VOLUME AND NET REVENUES
The diagnostics testing industry is faced with changing technology and new
product introductions. Advances in technology may lead to the development of
more cost-effective tests that can be performed outside of an independent
clinical laboratory such as (1) point-of-care tests that can be performed by
physicians in their offices and (2) home testing that can be performed by
patients. Development of such technology and its use by our customers would
reduce the demand for our laboratory testing services and
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negatively impact our revenues. Currently, most clinical laboratory testing is
categorized as "high" or "moderate" complexity, and thereby subject to extensive
and costly regulation, under the Clinical Laboratory Improvement Amendments of
1988, or CLIA. The cost of compliance with CLIA makes it not cost effective for
most physicians to operate clinical laboratories in their offices; other laws
limit the ability of physicians to have ownership in a laboratory and refer
tests to such laboratory. However, manufacturers of laboratory equipment and
test kits could seek to increase their sales by marketing point of care
laboratory equipment to physicians and by selling test kits approved for home
use to both physicians and patients. Over-the-counter diagnostics tests are
automatically deemed to be "waived" tests under CLIA, which may then be
performed in physician office laboratories as well as by patients in their homes
with minimal regulatory oversight. The Food and Drug Administration, or FDA, has
regulatory responsibility over instruments, test kits, reagents and other
devices used by clinical laboratories and recently has taken responsibility from
Center for Disease Control, or CDC, for test classification. Increased approval
of home test kits could lead to increased testing by physicians in their
offices, which could affect our market for laboratory testing services and
negatively impact our revenues.
EFFORTS BY THIRD PARTY PAYERS, INCLUDING THE GOVERNMENT, TO REDUCE UTILIZATION
AND PRICING COULD HAVE A MATERIAL ADVERSE IMPACT ON OUR NET REVENUES AND
PROFITABILITY
Government payers, such as Medicare and Medicaid, as well as private
payers, including managed care organizations, have taken steps and may continue
to take steps to control the cost, utilization and delivery of healthcare
services, including clinical laboratory services. Primarily as a result of
recent reimbursement rate reductions and utilization controls implemented by
government regulations, the percentage of our aggregate net revenues derived
from Medicare programs declined from 20% in 1995 to 13% in 2000. For a more
detailed description of the developments in government regulations, we urge
investors to read carefully our most recent annual report on Form 10-K filed
with the SEC and incorporated by reference into this prospectus.
In addition to changes in government reimbursement programs, private
payers, including managed care organizations, are demanding discounted fee
structures or the assumption by clinical laboratory service providers of all or
a portion of the financial risk through capitated payment contracts. Under
capitated payment contracts, clinical laboratories receive a fixed monthly fee
per individual enrolled with the managed care organization for all laboratory
tests performed during the month. In particular, managed care organizations,
which have significant bargaining power, frequently negotiate for capitated
payment contracts. In 2000, we derived approximately 9% of our revenues from
capitated payment contracts with managed care organizations. As the number of
patients covered by managed care organizations increased, more patients were
covered under capitated payment contracts, which resulted in reduced
opportunities for higher priced fee-for-service business and adversely affected
our profit margin.
We expect efforts to impose reduced reimbursements and more stringent cost
controls by government and other payers to continue. If we cannot offset
additional reductions in the payments we receive for our services by reducing
costs, increasing test volume and/or introducing new procedures, it could have a
material adverse impact on our net revenues and profitability.
FAILURE TO PROVIDE A HIGHER QUALITY OF SERVICE THAN THAT OF OUR COMPETITORS
COULD HAVE A MATERIAL ADVERSE IMPACT ON OUR NET REVENUES
While there has been significant consolidation in the clinical laboratory
testing business in recent years, it remains a fragmented and highly competitive
industry. We compete with three types of laboratory providers:
hospital-affiliated laboratories, other independent clinical laboratories and
physician-office laboratories. Most physicians have admitting privileges or
other relationships with hospitals as part of their medical practice. Almost all
hospitals maintain an on-site laboratory to perform routine clinical testing on
their in-patients and out-patients. Many hospitals leverage their relationships
with community physicians and encourage the physicians to send their outreach
(non-hospital patients) testing to the hospital's laboratory. In addition,
hospitals that own physician practices generally require the physicians to refer
tests to the hospital's affiliated laboratories. As a result of this affiliation
between hospitals and community
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physicians, we compete against hospital-affiliated laboratories primarily based
on quality of service. Our failure to provide service superior to
hospital-affiliated laboratories and other laboratories could have a material
adverse impact on our net revenues.
IF WE FAIL TO COMPLY WITH EXTENSIVE LAWS AND REGULATIONS, WE COULD SUFFER
PENALTIES OR BE REQUIRED TO MAKE SIGNIFICANT CHANGES TO OUR OPERATIONS
We are subject to extensive and frequently changing federal, state and
local laws and regulations. We believe that, based on our experience with
government settlements and public announcements by various government officials,
the federal government's position on healthcare fraud continues to harden. In
addition, legislative provisions relating to healthcare fraud and abuse give
federal enforcement personnel substantially increased funding, powers and
remedies to pursue suspected fraud and abuse. While we believe that we are in
material compliance with all applicable laws, many of the regulations applicable
to us, including those relating to billing and reimbursement of tests and those
relating to relationships with physicians and hospitals, are vague or indefinite
and have not been interpreted by the courts. They may be interpreted or applied
by a prosecutorial, regulatory or judicial authority in a manner that could
require us to make changes in our operations, including our billing practices.
If we fail to comply with applicable laws and regulations, we could suffer civil
and criminal penalties, including the loss of licenses or our ability to
participate in Medicare, Medicaid and other federal and state healthcare
programs.
During the mid-1990s, Quest Diagnostics and SBCL settled government claims
that primarily involved industry-wide billing and marketing practices that both
companies believed to be lawful. The aggregate amount of the settlements for
these claims exceeded $500 million. The federal or state governments may bring
additional claims based on new theories as to our practices that we believe to
be in compliance with law. The federal government has substantial leverage in
negotiating settlements since the amount of potential fines far exceeds the
rates at which we are reimbursed and the government has the remedy of excluding
a non-compliant provider from participation in the Medicare program, which
represented approximately 13% of our consolidated net revenues during 2000.
There remain pending against Quest Diagnostics and SBCL private claims
arising out of the settlement of the government claims, including several class
actions brought against SBCL. We believe that our reserves with respect to such
claims are adequate. However, we understand that there may be pending qui tam,
or "whistle blower," claims brought by former employees or others as to which we
have not been provided with a copy of the complaint and accordingly cannot
determine the extent of any potential liability. Liabilities with respect to the
claims that we know are pending against SBCL are generally covered by an
indemnification from SmithKline Beecham. The indemnities we obtained from
SmithKline Beecham in connection with liabilities from government investigations
do not cover governmental claims that arise after the closing date of the SBCL
acquisition, private claims unrelated to the governmental claims or
investigations subject to SBCL indemnification, and any consequential or
incidental damages relating to the billing claims, including losses of revenues
and profits as a consequence of exclusion from participation in federal or state
health care programs. For additional information, see our most recent annual
report on Form 10-K and quarterly reports on Form 10-Q filed with the Commission
and incorporated by reference into this prospectus.
THE FINAL PRIVACY REGULATIONS THAT WILL TAKE EFFECT IN 2003 AND PROPOSED FEDERAL
SECURITY REGULATIONS UNDER THE HEALTH INSURANCE PORTABILITY AND ACCOUNTABILITY
ACT OF 1996 WILL INCREASE OUR COSTS AND COULD LIMIT OUR ABILITY TO PROVIDE
MEDICAL INFORMATION.
Pursuant to the Health Insurance Portability and Accountability Act of
1996, or HIPAA, on December 28, 2000, the Secretary of the Department of Health
and Human Services, or HHS, issued final regulations that established
comprehensive federal standards with respect to the use and disclosure of
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protected health information by health plans, healthcare providers and
healthcare data clearinghouses. The regulations establish a complex regulatory
framework on a variety of subjects, including:
- the circumstances under which disclosures and uses of protected health
information require a general patient consent, specific authorization by
the patient, or no patient consent or authorization;
- the content of notices of privacy practices for protected health
information;
- patients' rights to access, amend, and receive an accounting of the
disclosures and uses of protected health information; and
- administrative, technical and physical safeguards required of entities
that use or receive protected health information.
The regulations establish a "floor" and do not supersede state laws that
are more stringent. Therefore, we are required to comply with both federal
privacy standards and varying state privacy laws. In addition, for healthcare
data transfers relating to citizens of other countries, we will need to comply
with the laws of other countries. The federal privacy regulations became
effective in April 2001 for healthcare providers, but healthcare providers have
until April 2003 to comply with the regulations. In addition, final standards
for electronic transactions were issued in August 2000 and will become effective
in October 2002. These regulations provide uniform standards for code sets
(codes representing medical procedures and laboratory tests and diagnosis codes
which are used, among others, in connection with the identification and billing
of medical procedures and laboratory tests), electronic claims, remittance
advice, enrollment, eligibility and other electronic transactions. Finally, the
proposed security and electronic signature regulations issued by the Secretary
of HHS in August 1998 pursuant to HIPAA are expected to be finalized this year.
HIPAA provides for significant fines and other penalties for wrongful disclosure
of protected health information. Compliance with the HIPAA requirements, when
finalized, will require significant capital and personnel resources from all
healthcare organizations, including ours. However, we will not be able to
estimate the cost of complying with all of these regulations, which we expect to
be significant, until after all the regulations are finalized. These
regulations, when finalized and effective, could also restrict our ability to
use our laboratory database to provide medical information for purposes other
than payment, treatment or healthcare operations, except for information that
does not identify a patient.
OUR TESTS AND BUSINESS PROCESSES MAY INFRINGE ON THE INTELLECTUAL PROPERTY
RIGHTS OF OTHERS, WHICH COULD CAUSE US TO ENGAGE IN COSTLY LITIGATION, PAY
SUBSTANTIAL DAMAGES OR PROHIBIT US FROM SELLING OUR TESTS
Other companies or individuals, including our competitors, may obtain
patents or other property rights that would prevent, limit or interfere with our
ability to develop, perform or sell our tests or operate our business. As a
result, we may be involved in intellectual property litigation and we may be
found to infringe on the proprietary rights of others, which could force us to
do one or more of the following:
- cease developing, performing or selling products or services that
incorporate the challenged intellectual property;
- obtain and pay for licenses from the holder of the infringed intellectual
property right;
- redesign or reengineer our tests;
- change our business processes; or
- pay substantial damages, court costs and attorneys' fees, including
potentially increased damages for any infringement held to be willful.
Patents generally are not issued until several years after an application
is filed. The fact that, before a patent is issued to a third party, we may be
performing a test or other activity covered by the patent is not a defense to an
infringement claim. Thus, tests that we develop could become the subject of
infringement claims if a third party obtains a patent covering those tests.
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Infringement and other intellectual property claims, whether with or
without merit, can be expensive and time-consuming to litigate. In addition, any
requirement to reengineer our tests or change our business processes could
substantially increase our costs, force us to interrupt product sales or delay
new test releases. In the past, we have settled several disputes regarding our
alleged infringement of intellectual property of third parties. We are currently
involved in settling several additional disputes. We do not believe that
resolution of these disputes will have a material adverse effect on our
operations or financial condition. However, infringement claims could arise in
the future as patents could be issued on tests or processes that we may be
performing, particularly in such emerging areas as gene based testing and other
specialty testing.
PROFESSIONAL LIABILITY LITIGATION COULD HAVE AN ADVERSE IMPACT ON OUR CLIENT
BASE AND REPUTATION
As a general matter, providers of clinical laboratory testing services may
be subject to lawsuits alleging negligence or other similar legal claims. These
suits could involve claims for substantial damages. Any professional liability
litigation could also have an adverse impact on our client base and reputation.
We maintain liability insurance for professional liability claims, subject to
maximum limits and self-insured retention. Our management believes that the
levels of coverage are adequate to cover currently estimated exposures.
FEDERAL AND STATE LAWS PERMIT A COURT TO VOID A GUARANTEE ISSUED BY ANY OF OUR
SUBSIDIARIES IF THE COURT FINDS THE GUARANTEE TO CONSTITUTE A FRAUDULENT
CONVEYANCE
Our obligations under the debt securities may be guaranteed to the extent
described in this prospectus, and as further described in any prospectus
supplement, by our subsidiaries. These guarantees are subject to attack under
various federal and state fraudulent conveyance laws enacted for the protection
of creditors.
The issuance of a guarantee by any of our subsidiaries will constitute a
fraudulent conveyance if
- the guarantee was incurred by the subsidiary with the intent to hinder,
delay or defraud any present or future creditor; or
- the subsidiary did not receive fair consideration for issuing the
guarantee and such subsidiary (1) was insolvent or rendered insolvent by
reason of the issuance of the guarantee, (2) was engaged or about to
engage in a business or transaction for which the remaining assets of the
subsidiary constituted unreasonably small capital to carry on its
business or (3) intended to incur debts beyond its ability to pay such
debts as they matured.
Generally, an entity will be considered insolvent if:
- the sum of its debts is greater than the fair value of its property,
- the present fair value of its assets is less than the amount that it will
be required to pay on its existing debts as they become due, or
- it cannot pay its debts as they become due.
If a court finds a guarantee issued by a subsidiary of ours to constitute a
fraudulent conveyance, the court could give a lower priority to, or subordinate,
the claims of our debt securities against this subsidiary to the claims of other
creditors of this subsidiary. In addition, a court could avoid all or part of
the guarantee. To the extent the guarantee issued by a subsidiary of ours was
voided as a fraudulent conveyance, the holders of our debt securities would
cease to have any claim against the subsidiary and would be creditors solely of
Quest Diagnostics and any other subsidiary guarantor which was not found to have
made a fraudulent conveyance. See "Description of Debt
Securities -- Guarantees."
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OUR SUBSTANTIAL DEBT MAY IMPAIR OUR FINANCIAL AND OPERATING FLEXIBILITY
We have a significant amount of debt. As of March 31, 2001, we had
approximately $1 billion of debt outstanding. As of March 31, 2001, the
aggregate amount of principal and interest payment obligations in respect of our
debt, including capital leases, for each of the next five years are as follows:
TWELVE MONTHS ENDED DECEMBER 31, PRINCIPAL INTEREST TOTAL
- -------------------------------- --------- -------- --------
(IN THOUSANDS)
2001.......................... $265,408 $98,147 $363,555
2002.......................... 7,337 95,465 102,802
2003.......................... 32,434 90,584 123,018
2004.......................... 6,666 88,875 95,541
2005.......................... 6,706 88,091 94,797
We determined the interest payment amounts in the table above using actual
interest expense for the three months ended March 31, 2001, and for subsequent
periods, the interest rates in effect as of March 31, 2001, after considering
the impact of our interest rate swap agreements on amounts of interest payable
on our debt carrying variable interest rates.
At March 31, 2001, we had approximately $848 million of variable interest
rate debt outstanding. Our credit agreement requires us to mitigate the risk of
changes in interest rates associated with a portion of our debt carrying
variable interest rates through the use of interest rate swap agreements. Under
such arrangements, we convert the variable interest rates on a portion of our
debt to fixed interest rates. As of March 31, 2001, we have entered into
interest rate swap agreements pursuant to which we have effectively converted
$410 million of our variable interest rate debt into fixed interest rate debt.
These agreements, which relate to different amounts of variable interest rate
debt, mature at various dates through November 2002.
Based on our net exposure to interest rate changes, an assumed 10% increase
in interest rates would result in an increase between $3 million and $5 million
in annual interest payments during the next five twelve month periods ending
December 31, 2005, after considering the impact of our interest rate swap
agreements on amounts of interest payable on our debt carrying variable interest
rates. The primary interest rate exposures on our debt carrying variable
interest rates are with respect to interest rates on United States dollars as
quoted in the London interbank market.
Our debt agreements contain various restrictive covenants. All these
restrictions, together with our high level of debt, could:
- limit our ability to use operating cash flow in other areas of our
business, because we must use a portion of these funds to make principal
and interest payments on our debt; and
- increase our vulnerability to interest-rate fluctuations because the debt
under our credit facility is at variable interest rates.
Our ability to make principal and interest payments on our debt and to
satisfy our other debt obligations will depend upon our ability to generate cash
in the future. If we do not generate sufficient cash flow to meet our debt
service requirements, we may need to seek additional financing. This may make it
more difficult for us to obtain financing on terms that are acceptable to us, or
at all. For additional information regarding our debt, including interest rates
and related payment obligations, see "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and Note 12 to our consolidated
financial statements included in our annual report on Form 10-K for the year
ended December 31, 2000 filed with the SEC and "Management's Discussion and
Analysis of Financial Condition and Results of Operations" included in our
quarterly report on Form 10-Q for the quarter ended March 31, 2001 filed with
the SEC.
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FUTURE SALES BY OUR STOCKHOLDERS COULD ADVERSELY AFFECT OUR COMMON STOCK PRICE
As of June 1, 2001, in addition to the shares of our common stock that may
be offered by this prospectus, approximately 10.4 million shares of our common
stock are issuable upon exercise of outstanding stock options under our employee
stock options plan and non-employee director stock option plan and an additional
approximately 9.1 million shares of our common stock are reserved for issuance
of additional options and shares under these plans. We also issue shares of our
common stock under our employee stock purchase plan, employee stock ownership
plan and supplemental deferred compensation plan. In addition, SmithKline
Beecham, which owns about 22.2 million shares of our common stock or about 23.5%
of our outstanding common stock as of June 1, 2001, is entitled to demand up to
four times that we register its shares of our common stock and to participate in
registered offerings initiated by us or a third party. Sale of a substantial
number of our common stock in the market could adversely affect the price of our
common stock.
CERTAIN PROVISIONS OF OUR CHARTER, BY-LAWS AND DELAWARE LAW MAY DELAY OR PREVENT
A CHANGE OF CONTROL OF OUR COMPANY
Our corporate documents and Delaware law contain provisions that may enable
our management to resist a change of control of our company. These provisions
include a staggered board of directors, limitations on persons authorized to
call a special meeting of stockholders and advance notice procedures required
for stockholders to make nominations of candidates for election as directors or
to bring matters before an annual meeting of stockholders. We also have a rights
plan designed to make it more costly and thus more difficult to gain control of
our company. These anti-takeover defenses might discourage, delay or prevent a
change of control. These provisions could also discourage proxy contests and
make it more difficult for you and other stockholders to elect directors and
cause us to take other corporate actions. In addition, the existence of these
provisions, together with Delaware law, might hinder or delay an attempted
takeover other than through negotiations with our board of directors.
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RATIO OF EARNINGS TO FIXED CHARGES AND EARNINGS TO
COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
Set forth below is information concerning our ratios of earnings to fixed
charges and earnings to combined fixed charges and preferred stock dividends.
These ratios show the extent to which our business generates enough earnings
after the payment of all expenses other than interest and preferred stock
dividends to make required interest and dividend payments on our debt and
preferred stock.
For this purpose, earnings consist of pretax income plus fixed charges.
Fixed charges consist of interest expense and one-third of rental expense,
representing that portion of rental expense we deemed representative of an
appropriate interest factor. Preferred stock dividends consist of the amount of
pretax earnings required to pay the dividends on outstanding preference
securities.
THREE
MONTHS
ENDED
MARCH 31, YEAR ENDED DECEMBER 31,
------------ ------------------------------------
2001 2000 1999 1998 1997 1996
------------ ---- ---- ---- ---- ----
Ratio of earnings to fixed charges........... 3.1x 2.4x 1.2x 2.0x (a) (a)
Ratio of earnings to combined fixed charges
and preferred stock dividends.............. 3.1x 2.4x 1.3x 2.0x (a) (a)
- ---------------
(a) Earnings were insufficient to cover fixed charges and combined fixed charges
and preferred stock dividend requirements by the following amounts in the
years indicated:
YEAR ENDED DECEMBER 31,
-----------------------
1997 1996
--------- ----------
(DOLLARS IN THOUSANDS)
$16,578 $676,202
USE OF PROCEEDS
Unless indicated otherwise in the applicable prospectus supplement, we
expect to use the net proceeds from the sale of our securities for general
corporate purposes, including, but not limited to, repayment or refinancing of
borrowings, working capital, capital expenditures and acquisitions. Additional
information on the use of net proceeds from the sale of securities offered by
this prospectus may be set forth in the prospectus supplement relating to such
offering. We will not receive any proceeds from the sale of our common stock by
SmithKline Beecham pursuant to the registration statement of which this
prospectus is a part.
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any reports, statements or other
information we file with the SEC at its public reference rooms at 450 Fifth
Street, N.W., Washington, D.C. 20549, 7 World Trade Center, Suite 1300, New
York, New York 10048 and 500 West Madison Street, Suite 1400, Chicago, Illinois
60661. Please call the SEC at 1-800-SEC-0330 for further information on the
public reference rooms. Our filings are also available to the public on the
Internet, through a database maintained by the SEC at http://www.sec.gov. In
addition, you can inspect and copy our reports, proxy statements and other
information at the offices of the New York Stock Exchange, Inc., 20 Broad
Street, New York, New York 10005.
Our subsidiary guarantors do not file separate financial statements with
the SEC and do not independently publish their financial statements. Instead,
our subsidiary guarantors' financial condition, results of operation and cash
flows are consolidated into our financial statements.
We filed a registration statement on Form S-3 to register with the SEC the
securities described in this prospectus. This prospectus is part of that
registration statement. As permitted by SEC rules, this prospectus does not
contain all the information contained in the registration statement or the
exhibits to the registration statement. You may refer to the registration
statement and accompanying exhibits for more information about us and our
securities.
The SEC allows us to incorporate by reference into this document the
information we filed with it. This means that we can disclose important
business, financial and other information to you by referring you to other
documents separately filed with the SEC. All information incorporated by
reference is part of this document, unless and until that information is updated
and superseded by the information contained in this document or any information
incorporated later.
We incorporate by reference the documents listed below:
1. Our current report on Form 8-K filed on October 31, 2000;
2. Our annual report on Form 10-K for the fiscal year ended December 31,
2000;
3. Our quarterly report on Form 10-Q for the fiscal quarter ended March 31,
2001;
4.Our current report on Form 8-K filed on June 1, 2001; and
5. The description of our common stock contained in our registration
statement on Form 10, filed pursuant to Section 12(b) of the Securities
Exchange Act of 1934 on September 23, 1996, as amended by Amendment No.
1 on Form 10/A, filed on November 6, 1996, Amendment No. 2 on Form 10/A,
filed on November 19, 1996, Amendment No. 3 on Form 10/A filed on
November 25, 1996 and Amendment No. 4 on Form 10/A filed on November 26,
1996.
You may request a copy of these filings, at no cost, by writing or
telephoning our Corporate Secretary at the following address:
Quest Diagnostics Incorporated
One Malcolm Avenue
Teterboro, New Jersey 07608
Attention: Corporate Secretary
(201) 393-5000
We also incorporate by reference all future filings we make with the SEC
under Section 13(a), 13(c), 14 or 15(d) of the Securities and Exchange Act of
1934 on or (i) after the date of the filing of the registration statement
containing this prospectus and prior to the effectiveness of such registration
statement and (ii) after the date of this prospectus and prior to the
termination of the offering made hereby.
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You should rely only on the information contained or incorporated by
reference in this prospectus and any prospectus supplement. We have not
authorized any other person to provide you with different information. If anyone
provides you with different or inconsistent information, you should not rely on
it. We are not making an offer to sell these securities in any jurisdiction
where the offer and sale is not permitted. You should assume that the
information appearing in this prospectus and information incorporated by
reference into this prospectus, is accurate only as of the date of the documents
containing the information. Our business, financial condition, results of
operation and prospects may have changed since that date.
FORWARD-LOOKING STATEMENTS
This prospectus and other materials we have filed or may file with the SEC,
as well as information included in other written statements made, or to be made,
by us, contain, or will contain, disclosures which are "forward-looking
statements." Forward-looking statements include all statements that do not
relate solely to historical or current facts, and can be identified by the use
of words such as "may," "believe," "will," "expect," "project," "estimate,"
"anticipate," "plan" or "continue." These forward-looking statements address,
among other things, our strategic objectives, the benefits of and potential cost
savings from our acquisition of SmithKline Beecham Clinical Laboratories, Inc.
These forward-looking statements are based on the current plans and expectations
of our management and are subject to a number of uncertainties and risks that
could significantly affect our current plans and expectations and future
financial condition and results, including, but not limited to, the risks
described in our Annual Report on Form 10-K and under "Risk Factors" in this
prospectus and the applicable prospectus supplement.
As a consequence, current plans, anticipated actions and future financial
conditions and results may differ significantly from those expressed in any
forward-looking statements made by or on behalf of our company.
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SECURITIES WE MAY ISSUE
OVERVIEW
This prospectus describes the securities we may issue from time to time.
The remainder of this section provides some background information about the
manner in which the securities may be held, then describes the terms of the
three basic categories of securities:
- our debt securities, which may be senior or subordinated;
- our preferred stock, which may be issued in the form of depositary shares
representing fractions of shares of preferred stock; and
- our common stock.
PROSPECTUS SUPPLEMENTS
This prospectus provides you with a general description of the securities
we may offer. Each time we sell securities, we will provide a prospectus
supplement that will contain specific information about the terms of that
offering. The prospectus supplement may also add to or change information
contained in this prospectus. If so, the prospectus supplement should be read as
superseding this prospectus. You should read both this prospectus and any
prospectus supplement together with additional information described under the
heading "Where You Can Find More Information."
The prospectus supplement to be attached to the front of this prospectus
will describe the terms of any securities that we offer and any initial offering
price to the public in that offering, the purchase price and net proceeds that
we will receive and the other specific terms related to our offering of the
securities. For more details on the terms of the securities, you should read the
exhibits filed with our registration statement, of which this prospectus is a
part.
LEGAL OWNERSHIP OF SECURITIES
HOLDERS OF SECURITIES
BOOK-ENTRY HOLDERS. We will issue debt securities in book-entry form only,
unless we specify otherwise in the applicable prospectus supplement. We may
issue shares of common stock and shares of preferred stock in book-entry form.
If securities are issued in book-entry form, this means the securities will be
represented by one or more global securities registered in the name of a
financial institution that holds them as depositary on behalf of other financial
institutions that participate in the depositary's book-entry system. These
participating institutions, in turn, hold beneficial interests in the securities
on behalf of themselves or their customers.
We will only recognize the person in whose name a security is registered as
the holder of that security. Consequently, for securities issued in global form,
we will recognize only the depositary as the holder of the securities and all
payments on the securities will be made to the depositary. The depositary passes
along the payments it receives to its participants, which in turn pass the
payments along to their customers who are the beneficial owners. The depositary
and its participants do so under agreements they have made with one another or
with their customers; they are not obligated to do so under the terms of the
securities.
As a result, investors will not own securities directly. Instead, they will
own beneficial interests in a global security, through a bank, broker or other
financial institution that participates in the depositary's book-entry system or
holds an interest through a participant. As long as the securities are issued in
global form, investors will be indirect holders, and not holders, of the
securities.
STREET NAME HOLDERS. In the future, we may terminate a global security or
issue securities initially in non-global form. In these cases, investors may
choose to hold their securities in their own names or in "street name."
Securities held by an investor in street name would be registered in the name of
a bank, broker or other financial institution that the investor chooses, and the
investor would hold only a beneficial interest in those securities through an
account he or she maintains at that institution.
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For securities held in street name, we will recognize only the intermediary
banks, brokers and other financial institutions in whose names the securities
are registered as the holders of those securities and all payments on those
securities will be made to them. These institutions pass along the payments they
receive to their customers who are the beneficial owners, but only because they
agree to do so in their customer agreements or because they are legally required
to do so. Investors who hold securities in street name will be indirect holders,
not holders, of those securities.
LEGAL HOLDERS. We, and any third parties employed by us or acting on your
behalf, such as trustees, depositories and transfer agents, are obligated only
to the legal holders of the securities. We do not have obligations to investors
who hold beneficial interests in global securities, in street name or by any
other indirect means. This will be the case whether an investor chooses to be an
indirect holder of a security or has no choice because we are issuing the
securities only in global form.
For example, once we make a payment or give a notice to the legal holder,
we have no further responsibility for the payment or notice even if that legal
holder is required, under agreements with depositary participants or customers
or by law, to pass it along to the indirect holders but does not do so.
Similarly, if we want to obtain the approval of the holders for any purpose (for
example, to amend an indenture or to relieve ourselves of the consequences of a
default or of our obligation to comply with a particular provision of the
indenture), we would seek the approval only from the legal holders, and not the
indirect holders, of the securities. Whether and how the legal holders contact
the indirect holders is up to the legal holders.
When we refer to you, we mean those who invest in the securities being
offered by this prospectus, whether they are the legal holders or only indirect
holders of those securities. When we refer to your securities, we mean the
securities in which you hold a direct or indirect interest.
SPECIAL CONSIDERATIONS FOR INDIRECT HOLDERS. If you hold securities
through a bank, broker or other financial institution, either in book-entry form
or in street name, you should check with your own institution to find out:
- how it handles securities payments and notices;
- whether it imposes fees or charges;
- how it would handle a request for the holders' consent, if ever required;
- whether and how you can instruct it to send you securities registered in
your own name so you can be a legal holder, if that is permitted in the
future;
- how it would exercise rights under the securities if there were a default
or other event triggering the need for holders to act to protect their
interests; and
- if the securities are in book-entry form, how the depositary's rules and
procedures will affect these matters.
GLOBAL SECURITIES
WHAT IS A GLOBAL SECURITY? A global security represents one or any other
number of individual securities. Generally, all securities represented by the
same global securities will have the same terms. We may, however, issue a global
security that represents multiple securities that have different terms and are
issued at different times. We call this kind of global security a master global
security.
Each security issued in book-entry form will be represented by a global
security that we deposit with and register in the name of a financial
institution that we select or its nominee. The financial institution that is
selected for this purpose is called the depositary. Unless we specify otherwise
in the applicable prospectus supplement, The Depository Trust Company, New York,
New York, known as DTC, will be the depositary for all securities issued in
book-entry form.
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A global security may not be transferred to or registered in the name of
anyone other than the depositary or its nominee, unless special termination
situations arise or as otherwise described in the prospectus supplement. We
describe those situations below under "-- Special Situations When a Global
Security Will Be Terminated." As a result of these arrangements, the depositary,
or its nominee, will be the sole registered owner and holder of all securities
represented by a global security, and investors will be permitted to own only
beneficial interests in a global security. Beneficial interests must be held by
means of an account with a broker, bank or other financial institution that in
turn has an account with the depositary or with another institution that does.
Thus, an investor whose security is represented by a global security will not be
a holder of the security, but only an indirect holder of a beneficial interest
in the global security.
SPECIAL CONSIDERATIONS FOR GLOBAL SECURITIES. As an indirect holder, an
investor's rights relating to a global security will be governed by the account
rules of the investor's financial institution and of the depositary, as well as
general laws relating to securities transfers. We do not recognize this type of
investor as a holder of securities and instead will deal only with the
depositary that holds the global security.
If securities are issued only in the form of a global security, an investor
should be aware of the following:
- An investor cannot cause the securities to be registered in his or her
name, and cannot obtain physical certificates for his or her interest in
the securities, except in the special situations we describe below.
- An investor will be an indirect holder and must look to his or her own
bank or broker for payments on the securities and protection of his or
her legal rights relating to the securities, as we describe under
"-- Holders of Securities" above.
- An investor may not be able to sell interests in the securities to some
insurance companies and to other institutions that are required by law to
own their securities in non-book-entry form.
- An investor may not be able to pledge his or her interest in a global
security in circumstances where certificates representing the securities
must be delivered to the lender or other beneficiary of the pledge in
order for the pledge to be effective.
- The depositary's policies, which may change from time to time, will
govern payments, transfers, exchanges and other matters relating to an
investor's interest in a global security. Neither we nor any third
parties employed by us or acting on your behalf, such as trustees and
transfer agents, have any responsibility for any aspect of the
depositary's actions or for its records of ownership interests in a
global security. We and the trustee do not supervise the depositary in
any way.
- DTC requires that those who purchase and sell interests in a global
security within its book-entry system use immediately available funds and
your broker or bank may require you to do so as well.
- Financial institutions that participate in the depositary's book-entry
system, and through which an investor holds its interest in a global
security, may also have their own policies affecting payments, notices
and other matters relating to the security. There may be more than one
financial intermediary in the chain of ownership for an investor. We do
not monitor and are not responsible for the actions of any of those
intermediaries.
SPECIAL SITUATIONS WHEN A GLOBAL SECURITY WILL BE TERMINATED. In a few
special situations described below, a global security will be terminated and
interests in it will be exchanged for certificates in non-global form
representing the securities it represented. After that exchange, the choice of
whether to hold the securities directly or in street name will be up to the
investor. Investors must consult their own banks or brokers to find out how to
have their interests in a global security transferred on termination to their
own names, so that they will be holders. We have described the rights of holders
and street name investors above under "-- Legal Ownership of
Securities -- Holders of Securities."
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The special situations for termination of a global security are as follows:
- if the depositary notifies us that it is unwilling, unable or no longer
qualified to continue as depositary for that global security and we do
not appoint another institution to act as depositary within a specified
time period;
- if we elect to terminate that global security; or
- if an event of default has occurred with regard to securities represented
by that global security and it has not been cured or waived.
The prospectus supplement may also list additional situations for
terminating a global security that would apply to a particular series of
securities covered by the prospectus supplement. If a global security is
terminated, only the depositary is responsible for deciding the names of the
institutions in whose names the securities represented by the global security
will be registered and, therefore, who will be the holders of those securities.
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DESCRIPTION OF DEBT SECURITIES
We may issue debt securities from time to time in one or more distinct
series. This section summarizes the material terms of our senior or subordinated
debt securities that are common to all series. Most of the financial and other
terms of any series of debt securities that we offer will be described in the
prospectus supplement to be attached to the front of this prospectus.
As required by U.S. federal law for all bonds and notes of companies that
are publicly offered, the debt securities will be governed by a document called
an "indenture." An indenture is a contract between us and a financial
institution, in this case, The Bank of New York, acting as trustee on your
behalf. The indenture will be subject to and governed by the Trust Indenture Act
of 1939. The trustee has two main roles:
- First, subject to some limitations, the trustee can enforce your rights
against us if we default.
- Second, the trustee performs certain administrative duties for us, which
include sending you interest payments and notices.
Because we may issue both senior debt securities and subordinated debt
securities, our references to the indenture are to each of the senior indenture
and the subordinated indenture, unless the context requires otherwise. In this
section, we refer to these indentures collectively as the "indentures." In
addition, because our debt securities may or may not be guaranteed by our
subsidiary guarantors, our references to subsidiary guarantors are applicable
only if the prospectus supplement indicates that the debt securities will be
guaranteed by our subsidiary guarantors.
Because this section is a summary of the material terms of the indentures,
it does not describe every aspect of the debt securities. We urge you to read
the indentures because they, and not this description, define your rights as a
holder of debt securities. Some of the definitions are repeated in this
prospectus, but for the rest you will need to read the indentures. We have filed
the forms of the indentures as exhibits to a registration statement that we have
filed with the SEC, of which this prospectus is a part. See "Where You Can Find
More Information," for information on how to obtain copies of the indentures.
GENERAL
The debt securities will be unsecured obligations of our company. The
senior debt securities will rank equally with all of our other unsecured and
unsubordinated indebtedness. The subordinated debt securities will be
subordinate and junior in right of payment to all our existing and future senior
indebtedness, as defined below.
To the extent that our debt securities are guaranteed, the debt securities
described in this prospectus may be fully and unconditionally guaranteed on a
joint and several basis by any of the following wholly-owned subsidiaries: Quest
Diagnostics Holdings Incorporated, Quest Diagnostics Clinical Laboratories,
Inc., Quest Diagnostics Incorporated (CA), Quest Diagnostics Incorporated (MD),
Quest Diagnostics LLC, Quest Diagnostics Incorporated (MI), Quest Diagnostics
Incorporated (CT), Quest Diagnostics Incorporated (MA), Quest Diagnostics of
Pennsylvania Inc., Quest Diagnostics Incorporated (OH), Metwest Inc., Nichols
Institute Diagnostics, DPD Holdings, Inc., Diagnostics Reference Services Inc.,
Pathology Building Partnership, Quest Diagnostics Investments Incorporated,
Quest Diagnostics Finance Incorporated and Laboratory Holdings Incorporated.
Guarantees of our senior debt securities will be unsecured senior obligations of
our subsidiary guarantors and will rank equally with all other unsecured and
unsubordinated obligations of such subsidiary guarantors. Guarantees of our
subordinated debt securities will be unsecured subordinated obligations of our
subsidiary guarantors and will be subordinate in right of payment to the prior
payment in full of all guarantees by our subsidiary guarantors of our senior
indebtedness.
Our debt securities are effectively subordinated to all existing and future
indebtedness and other liabilities (including trade payables and capital lease
obligations) of any of our subsidiaries not giving a guarantee, and would be so
subordinated if a guarantee issued by any of our subsidiary guarantors were
avoided or subordinated in favor of the subsidiary guarantor's other creditors.
See "Risk Factors -- Federal
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and state laws permit a court to void a guarantee issued by any of our
subsidiaries if the court finds the guarantee to constitute a fraudulent
conveyance."
You should read the prospectus supplement for the following terms of the
series of debt securities offered by the prospectus supplement:
- The title of the debt securities and whether the debt securities will be
senior debt securities or subordinated debt securities.
- The aggregate principal amount of the debt securities, the percentage of
their principal amount at which the debt securities will be issued and
the date or dates when the principal of the debt securities will be
payable or how those dates will be determined.
- The interest rate or rates, which may be fixed or variable, that the debt
securities will bear, if any, and how the rate or rates will be
determined.
- The date or dates from which any interest will accrue or how the date or
dates will be determined, the date or dates on which any interest will be
payable, any regular record dates for these payments or how these dates
will be determined and the basis on which any interest will be
calculated, if other than on the basis of a 360-day year of twelve 30-day
months.
- The place or places, if any, other than or in addition to New York City,
of payment, transfer, conversion and exchange of the debt securities and
where notices or demands to or upon us in respect of the debt securities
may be served.
- Any optional redemption provisions.
- Any sinking fund or other provisions that would obligate us to repurchase
or redeem the debt securities.
- Whether the amount of payments of principal of, or premium, if any, or
interest on the debt securities will be determined with reference to an
index, formula or other method, which could be based on one or more
commodities, equity indices or other indices, and how these amounts will
be determined.
- Any changes or additions to the events of default under the applicable
indenture or our covenants, including additions of any restrictive
covenants, with respect to the debt securities.
- If not the principal amount of the debt securities, the portion of the
principal amount that will be payable upon acceleration of the maturity
of the debt securities or how that portion will be determined.
- Any changes or additions to the provisions concerning defeasance and
covenant defeasance contained in the indenture that will be applicable to
the debt securities.
- Any provisions granting special rights to the holders of the debt
securities upon the occurrence of specified events.
- If other than the trustee, the name of any paying agent, security
registrar and transfer agent for the debt securities.
- If the debt securities are not to be issued in book-entry form only and
held by The Depositary Trust Company, as depositary, the form of such
debt securities, including whether such debt securities are to be
issuable in permanent or temporary global form, as registered securities,
bearer securities or both, any restrictions on the offer, sale or
delivery of bearer securities and the terms, if any, upon which bearer
securities of the series may be exchanged for registered securities of
the series and vice versa, if permitted by applicable law and
regulations.
- If other than US dollars, the currency or currencies of such debt
securities.
- The person to whom any interest in a debt security will be payable, if
other than the registered holder at the close of business on the regular
record date.
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- The denomination or denominations that the debt securities will be
issued, if other than denominations of $1,000 or any integral multiples
in the case of the registered securities and $5,000 or any integral
multiples in the case of the bearer securities.
- Whether such debt securities will be convertible into or exchangeable for
any other securities and, if so, the terms and conditions upon which such
debt securities will be so convertible or exchangeable.
- A discussion of federal income tax, accounting and other special
considerations, procedures and limitations with respect to the debt
securities.
- Whether and under what circumstances we will pay additional amounts to
holders in respect of any tax assessment or government charge, and, if
so, whether we will have the option to redeem the debt securities rather
than pay such additional amounts.
- Whether payment of any amounts due under the applicable indenture will be
guaranteed by one or more of our subsidiaries.
- Any other terms of the debt securities that are consistent with the
provisions of the indenture.
For purposes of this prospectus, any reference to the payment of principal
of, premium or interest, if any, on debt securities will include additional
amounts if required by the terms of such debt securities.
The indentures do not limit the amount of debt securities that we are
authorized to issue from time to time. The indentures also provide that there
may be more than one trustee thereunder, each for one or more series of debt
securities. At a time when two or more trustees are acting under the indenture,
each with respect to only certain series, the term "debt securities" means the
series of debt securities for which each respective trustee is acting. If there
is more than one trustee under the indenture, the powers and trust obligations
of each trustee will apply only to the debt securities for which it is trustee.
If two or more trustees are acting under the indenture, then the debt securities
for which each trustee is acting would be treated as if issued under separate
indentures.
We may issue debt securities with terms different from those of debt
securities that may already have been issued. Without the consent of the holders
thereof, we may reopen a previous issue of a series of debt securities and issue
additional debt securities of that series unless the reopening was restricted
when that series was created.
There is no requirement that we issue debt securities in the future under
any indenture, and we may use other indentures or documentation, containing
different provisions in connection with future issues of other debt securities.
We may issue the debt securities as original issue discount securities,
which are debt securities, including any zero-coupon debt securities, that are
issued and sold at a discount from their stated principal amount. Original issue
discount securities provide that, upon acceleration of their maturity, an amount
less than their principal amount will become due and payable. We will describe
the U.S. federal income tax consequences and other considerations applicable to
original issue discount securities in any prospectus supplement relating to
them.
GUARANTEES
Each of our subsidiaries may fully and unconditionally guarantee the
payment of the principal of, premium and interest on our debt securities. The
guarantees of the debt securities will be endorsed on the debt securities and
will be unsecured obligations of our subsidiary guarantors. Guarantees of our
senior debt securities will be unsecured senior obligations of our subsidiary
guarantors. The guarantees of a particular subsidiary guarantor will rank
equally with all other unsecured and unsubordinated obligations of that
subsidiary guarantor. Guarantees of our subordinated debt securities will be
unsecured subordinated obligations of our subsidiary guarantors. The guarantees
of a particular subsidiary guarantor will be subordinate in right of payment to
the prior payment in full of all guarantees by that subsidiary guarantor of our
senior indebtedness and will rank equally with all other unsecured and
subordinated obligations of that subsidiary guarantor.
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Our wholly-owned subsidiaries that may from time to time guarantee our debt
securities are the following: Quest Diagnostics Holdings Incorporated, Quest
Diagnostics Clinical Laboratories, Inc., Quest Diagnostics Incorporated (CA),
Quest Diagnostics Incorporated (MD), Quest Diagnostics LLC, Quest Diagnostics
Incorporated (MI), Quest Diagnostics Incorporated (CT), Quest Diagnostics
Incorporated (MA), Quest Diagnostics of Pennsylvania Inc., Quest Diagnostics
Incorporated (OH), Metwest Inc., Nichols Institute Diagnostics, DPD Holdings,
Inc., Diagnostics Reference Services Inc., Pathology Building Partnership, Quest
Diagnostics Investments Incorporated, Quest Diagnostics Finance Incorporated and
Laboratory Holdings Incorporated. Together, these subsidiaries operate
substantially all of our business.
Applicable indentures will provide that the obligations of each subsidiary
guarantor under its guarantee will be limited so as not to constitute a
fraudulent conveyance under applicable United States federal or state laws.
Application of this clause could limit the amount that holders of debt
securities may be entitled to collect under the guarantees. Holders, by their
acceptance of our debt securities, will have agreed to such limitations. See
"Risk Factors -- Federal and state laws permit a court to void a guarantee
issued by any of our subsidiaries if the court finds the guarantee to constitute
a fraudulent conveyance."
CONVERSION AND EXCHANGE
If any debt securities are convertible into or exchangeable for other
securities, the prospectus supplement will explain the terms and conditions of
such conversion or exchange, including:
- the conversion price or exchange ratio, or the calculation method for
such price or ratio;
- the conversion or exchange period, or how such period will be determined;
- if conversion or exchange will be mandatory or at the option of the
holder or our company;
- provisions for adjustment of the conversion price or the exchange ratio;
and
- provisions affecting conversion or exchange in the event of the
redemption of the debt securities.
Such terms may also include provisions under which the number or amount of
other securities to be received by the holders of such debt securities upon
conversion or exchange would be calculated according to the market price of such
other securities as of a time stated in the prospectus supplement.
ADDITIONAL MECHANICS
FORM, EXCHANGE AND TRANSFER
The debt securities will be issued:
- as registered securities; or
- as bearer securities (unless otherwise stated in the prospectus
supplement, with interest coupons attached); or
- in global form, see "Securities We May Issue -- Global Securities;" or
- in denominations that are even multiples of $1,000, in the case of
registered securities, and in even multiples of $5,000, in the case of
bearer securities.
You may have your registered securities divided into registered securities
of smaller denominations or combined into registered securities of larger
denominations, as long as the total principal amount is not changed. This is
called an "exchange."
You may exchange or transfer registered securities of a series at the
office of the trustee in New York City. That office is currently located at The
Bank of New York, 101 Barclay Street, Floor 21W, New York, New York 10286, Attn:
Corporate Trust -- Trustee Administration. The trustee maintains the list of
registered holders and acts as our agent for registering debt securities in the
names of holders and transferring debt securities. However, we may appoint
another trustee to act as our agent or act as our own agent. If provided in the
prospectus supplement, you may exchange your bearer securities for registered
securities of the same series so long as the total principal amount is not
changed. Unless otherwise specified in the prospectus supplement, bearer
securities will not be issued in exchange for registered securities.
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You will not be required to pay a service charge to transfer or exchange
debt securities, but you may be required to pay for any tax or other
governmental charge associated with the exchange or transfer. The transfer or
exchange will only be made if the transfer agent is satisfied with your proof of
ownership.
If we designate additional transfer agents, they will be named in the
prospectus supplement. We may cancel the designation of any particular transfer
agent. We may also approve a change in the office through which any transfer
agent acts.
If the debt securities are redeemable and we redeem less than all of the
debt securities of a particular series, we may block the transfer or exchange of
debt securities for 15 days before the day we mail the notice of redemption or
publish such notice (in the case of bearer securities) and ending on the day of
that mailing or publication in order to freeze the list of holders to prepare
the mailing. At our option, we may mail or publish such notice of redemption
through an electronic medium. We may also refuse to register transfers or
exchanges of debt securities selected for redemption, except that we will
continue to permit transfers and exchanges of the unredeemed portion of any debt
security being partially redeemed.
PAYING AND PAYING AGENTS
If you are a holder of registered securities, we will pay interest to you
if you are a direct holder in the list of registered holders at the close of
business on a particular day in advance of each due date for interest, even if
you no longer own the security on the interest due date. That particular time
and day, usually about two weeks in advance of the interest due date, is called
the "Regular Record Date" and is stated in the prospectus supplement. Holders
buying and selling debt securities must work out between them how to compensate
for the fact that we will pay all the interest for an interest period to the one
who is the registered holder on the Regular Record Date. The most common manner
is to adjust the sales price of the debt securities to prorate interest fairly
between buyer and seller. This prorated interest amount is called "accrued
interest."
With respect to registered securities, we will pay interest, principal and
any other money due on the debt securities at the corporate trust office of the
trustee in New York City. That office is currently located at The Bank of New
York, 101 Barclay Street, Floor 21 West, New York, New York 10286, Attn:
Corporate Trust Administration. You must make arrangements to have your payments
picked up at or wired from that office. We may also choose to pay interest by
mailing checks or making wire transfers.
"STREET NAME" AND OTHER INDIRECT HOLDERS SHOULD CONSULT THEIR BANKS OR
BROKERS FOR INFORMATION ON HOW THEY WILL RECEIVE PAYMENTS.
If bearer securities are issued, unless otherwise provided in the
prospectus supplement, we will maintain an office or agency outside the United
States for the payment of all amounts due on the bearer securities. If debt
securities are listed on the Luxembourg Stock Exchange or any other stock
exchange located outside the United States, we will maintain an office or agency
for such debt securities in any city located outside the United States required
by such stock exchange. The initial locations of such offices and agencies will
be specified in the prospectus supplement. Unless otherwise provided in the
prospectus supplement, payment of interest on any bearer securities on or before
maturity will be made only against surrender of coupons for such interest
installments as they mature. Unless otherwise provided in the prospectus
supplement, no payment with respect to any bearer security will be made at any
office or agency of our company in the United States or by check mailed to any
address in the United States or by transfer to an account maintained with a bank
located in the United States. Notwithstanding the foregoing, payments of
principal, premium and interest, if any, on bearer securities payable in US
dollars will be made at the office of our paying agent in The City of New York
if (but only if) payment of the full amount in US dollars at all offices or
agencies outside the United States is illegal or effectively precluded by
exchange controls or other similar restrictions.
Regardless of who acts as the paying agent, all money paid by us to a
paying agent that remains unclaimed at the end of two years after the amount is
due to registered holders will be repaid to us. After that two-year period, you
may look only to us for payment and not to the trustee, any other paying agent
or anyone else.
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We may also arrange for additional payment offices, and may cancel or
change these offices, including our use of the trustee's corporate trust office.
We may also choose to act as our own paying agent. We must notify you of changes
in identities of the paying agents for any particular series of debt securities.
NOTICES
With respect to registered securities, we and the trustee will send notices
regarding the debt securities only to registered holders, using their addresses
as listed in the list of registered holders. With respect to bearer securities,
we and the trustee will give notice by publication in a newspaper of general
circulation in the City of New York or in such other cities that may be
specified in a prospectus supplement. At our option, we may send or publish
notices through an electronic medium as specified in the applicable prospectus
supplement.
EVENTS OF DEFAULT
You will have special rights if an event of default occurs in respect of
the debt securities of your series and is not cured, as described later in this
subsection.
WHAT IS AN EVENT OF DEFAULT? The term "event of default" in respect of the
debt securities of your series means any of the following:
- We and any of our subsidiary guarantors do not pay the principal of or
any premium on a debt security of such series on its due date.
- We and any of our subsidiary guarantors do not pay interest on a debt
security of such series within 30 days of its due date whether at
maturity, upon redemption or upon acceleration.
- We do not deposit any sinking fund payment in respect of debt securities
of such series on its due date.
- We or any of our subsidiary guarantors remains in breach of a covenant in
respect of debt securities of such series for 60 days after we receive a
written notice of default stating we are in breach and requiring that we
remedy the breach. The notice must be sent by either the trustee or
holders of 25% of the principal amount of debt securities of such series.
- We or any of our subsidiary guarantors files for bankruptcy or certain
other events in bankruptcy, insolvency or reorganization occur.
- Any of our of subsidiary guarantors repudiates its obligations under any
subsidiary guarantee or, except to the extent contemplated by the related
indenture, any subsidiary guarantee is determined to be unenforceable or
invalid or shall for any reasons cease to be in full force and effect.
- Any other event of default in respect of debt securities of such series
described in the prospectus supplement occurs.
The events of default described above may be modified as described in the
applicable prospectus supplement. An event of default for a particular series of
debt securities does not necessarily constitute an event of default for any
other series of debt securities issued under an indenture. The trustee may
withhold notice to the holders of debt securities of any default (except in the
payment of principal or interest) if it considers such withholding of notice to
be in the best interests of the holders.
REMEDIES IF AN EVENT OF DEFAULT OCCURS. If an event of default has
occurred and has not been cured, the trustee or the holders of 25% in principal
amount of the debt securities of the affected series may declare the entire
principal amount of all the debt securities of that series to be due and
immediately payable. This is called a declaration of acceleration of maturity.
If an event of default occurs because of certain events in bankruptcy,
insolvency or reorganization, the principal amount of all the debt securities of
that series will be automatically accelerated, without any action by the trustee
or any holder. There are special notice and timing rules which apply to the
acceleration of subordinated debt securities which are designed to protect the
interests of holders of senior debt. A declaration of acceleration of maturity
may be cancelled by the holders of at least a majority in principal amount of
the debt securities of the affected series if (1) all existing events of
default, other than the nonpayment of principal of or premium or
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interest, if any, on the debt securities of such series which have become due
solely because of the acceleration, have been cured or waived and (2) the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction.
Except in cases of default, where the trustee has some special duties, the
trustee is not required to take any action under the indenture at the request of
the holders unless the holders offer the trustee reasonable protection from
expenses and liability, called an "indemnity". If reasonable indemnity is
provided, the holders of a majority in principal amount of the outstanding debt
securities of the relevant series may direct the time, method and place of
conducting any lawsuit or other formal legal action seeking any remedy available
to the trustee. The trustee may refuse to follow those directions in certain
circumstances. No delay or omission in exercising any right or remedy will be
treated as a waiver of such right, remedy or event of default.
Before you are allowed to bypass the trustee and bring your own lawsuit or
other formal legal action or take other steps to enforce your rights or protect
your interests relating to the debt securities, the following must occur:
- You must give the trustee written notice that an event of default has
occurred and remains uncured.
- The holders of not less than 25% in principal amount of all outstanding
debt securities of the relevant series must make a written request that
the trustee take action because of the default and must offer reasonable
indemnity to the trustee against the cost and other liabilities of taking
that action.
- The trustee must not have taken action for 60 days after receipt of the
above notice and offer of indemnity.
- The holders of a majority in principal amount of the debt securities must
not have given the trustee a direction inconsistent with the above notice
during the 60-day period.
However, you are entitled at any time to bring a lawsuit for the payment of
money due on your debt securities on or after the due date.
Holders of a majority in principal amount of the debt securities of the
affected series may waive any past defaults other than (1) the payment of
principal, any premium or interest or (2) in respect of a covenant or other
provision that cannot be modified or amended without the consent of each holder.
"STREET NAME" AND OTHER INDIRECT HOLDERS SHOULD CONSULT THEIR BANKS OR
BROKERS FOR INFORMATION ON HOW TO GIVE NOTICE OR DIRECTION OR TO MAKE A REQUEST
OF THE TRUSTEE AND TO MAKE OR CANCEL A DECLARATION OF ACCELERATION.
Each year, we will furnish to the trustee a written statement of certain of
our officers certifying that to their knowledge we are in compliance with the
indentures and the debt securities, or else specifying any default.
MERGER OR CONSOLIDATION
Under the terms of the indentures, we are generally permitted to
consolidate or merge with another entity. We are also permitted to sell all or
substantially all of our assets to another entity. However, we may not take any
of these actions unless all the following conditions are met:
- either we will be the surviving corporation or, if we merge out of
existence or sell assets, the entity into which we merge or to which we
sell assets must agree to be legally responsible for the debt securities;
- immediately after the merger or transfer of assets, no default on the
debt securities can exist. A default for this purpose includes any event
that would be an event of default if the requirements for giving a
default notice or of having the default exist for a specific period of
time were disregarded;
- we must deliver certain certificates and documents to the trustee; and
- we must satisfy any other requirements specified in the prospectus
supplement.
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MODIFICATION OR WAIVER
There are three types of changes we can make to the indentures and the debt
securities.
CHANGES REQUIRING YOUR APPROVAL. First, there are changes that cannot be
made to your debt securities without your specific approval. Following is a list
of those types of changes:
- changing the stated maturity of the principal of or interest on a debt
security;
- reducing any amounts due on a debt security or payable upon acceleration
of the maturity of a security following a default;
- adversely affecting any right of repayment at the holder's option;
- changing the place (except as otherwise described in this prospectus) or
currency of payment on a debt security;
- impairing your right to sue for payment or to convert or exchange a
security;
- in the case of subordinated debt securities, modifying the subordination
provisions in a manner that is adverse to holders of the subordinated
debt securities;
- in the case of senior debt securities, modifying the securities to
subordinate the securities to other indebtedness;
- reducing the percentage of holders of debt securities whose consent is
needed to modify or amend the indenture;
- reducing the percentage of holders of debt securities whose consent is
needed to waive compliance with certain provisions of the indenture or to
waive certain defaults;
- reducing the requirements for quorum or voting with respect to the debt
securities;
- modifying any other aspect of the provisions of the indenture dealing
with modification and waiver except to increase the voting requirements;
- change in any of our obligations to pay additional amounts which are
required to be paid to holders with respect to taxes imposed on such
holders in certain circumstances; and
- other provisions specified in the prospectus supplement.
CHANGES REQUIRING A MAJORITY VOTE. The second type of change to the
indenture and the outstanding debt securities is the kind that requires a vote
in favor by holders of outstanding debt securities owning a majority of the
principal amount of the particular series affected. Separate votes will be
needed for each series even if they are affected in the same way. Most changes
fall into this category, except for clarifying changes and certain other changes
that would not adversely affect holders of the outstanding debt securities in
any material respect. The same vote would be required for us and our subsidiary
guarantors to obtain a waiver of all or part of certain covenants in the
applicable indenture, or a waiver of a past default. However, we and our
subsidiary guarantors cannot obtain a waiver of a payment default or any other
aspect of the indentures or the outstanding debt securities listed in the first
category described previously under "-- Changes Requiring Your Approval" unless
we and our subsidiary guarantors obtain your individual consent to the waiver.
CHANGES NOT REQUIRING APPROVAL. The third type of change does not require
any vote by holders of outstanding debt securities. This type is limited to
clarifications; curing ambiguities, defects or inconsistencies and certain other
changes that would not adversely affect holders of the outstanding debt
securities in any material respect. Qualifying or maintaining the qualification
of the indentures under the Trust Indenture Act do not require any vote by
holders of debt securities.
FURTHER DETAILS CONCERNING VOTING. When taking a vote, we will use the
following rules to decide how much principal amount to attribute to a debt
security:
- for original issue discount securities, we will use the principal amount
that would be due and payable on the voting date if the maturity of the
debt securities were accelerated to that date because of a default; and
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- for debt securities whose principal amount is not known (for example,
because it is based on an index), we will use a special rule for that
debt security described in the prospectus supplement.
Debt securities will not be considered outstanding, and therefore not
eligible to vote, if we have deposited or set aside in trust for you money for
their payment or redemption. Debt securities will also not be eligible to vote
if they have been fully defeased as described later under "Defeasance -- Full
Defeasance."
We will generally be entitled to set any day as a record date for the
purpose of determining the holders of outstanding indenture securities that are
entitled to vote or take other action under the indentures.
We are not required to set a record date. If we set a record date for a
vote or other action to be taken by holders of a particular series, that vote or
action may be taken only by persons who are holders of outstanding securities of
that series on the record date and must be taken within 180 days following the
record date or another period that we may specify. We may shorten or lengthen
this period from time to time.
"STREET NAME" AND OTHER INDIRECT HOLDERS SHOULD CONSULT THEIR BANKS OR
BROKERS FOR INFORMATION ON HOW APPROVAL MAY BE GRANTED OR DENIED IF WE SEEK TO
CHANGE THE INDENTURE OR THE DEBT SECURITIES OR REQUEST A WAIVER.
SATISFACTION AND DISCHARGE
The indentures will cease to be of further effect, and we and our
subsidiary guarantors will be deemed to have satisfied and discharged the
indentures with respect to a particular series of debt securities, when the
following conditions have been satisfied:
- all debt securities of that series not previously delivered to the
trustee for cancellation have become due and payable or will become due
and payable at their stated maturity or on a redemption date within one
year,
- we deposit with the trustee, in trust, funds sufficient to pay the entire
indebtedness on the debt securities of that series that had not been
previously delivered for cancellation, for the principal and interest to
the date of the deposit (for debt securities that have become due and
payable) or to the stated maturity or the redemption date, as the case
may be (for debt securities that have not become due and payable),
- we have paid or caused to be paid all other sums payable under the
indentures in respect of that series, and
- we have delivered to the trustee an officer's certificate and opinion of
counsel, each stating that all these conditions have been complied with.
We will remain obligated to provide for registration of transfer and
exchange and to provide notices of redemption.
DEFEASANCE
The following discussion of full defeasance and covenant defeasance will be
applicable to your series of debt securities only if we choose to have them
apply to that series. If we choose to do so, we will state that in the
applicable prospectus supplement and describe any changes to these provisions.
FULL DEFEASANCE. If there is a change in federal tax law, as described
below, we can legally release ourselves and our subsidiary guarantors from any
payment or other obligations on the debt securities, called "full defeasance",
if we put in place the following other arrangements for you to be repaid:
- We must deposit in trust for your benefit and the benefit of all other
registered holders of the debt securities a combination of money and U.S.
government or U.S. government agency notes or bonds that will generate
enough cash to make interest, principal and any other payments on the
debt securities on their various due dates including, possibly, their
earliest redemption date.
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- Under current federal tax law, the deposit and our legal release from the
debt securities would likely be treated as though you surrendered your
debt securities in exchange for your share of the cash and notes or bonds
deposited in trust. In that event, you could recognize gain or loss on
the debt securities you surrendered. In order for us to effect a full
defeasance, we must deliver to the trustee a legal opinion confirming
that you will not recognize income gain or loss for federal income tax
purposes as a result of the defeasance and that you will not be taxed on
the debt securities any differently than if we did not make the deposit
and just repaid the debt securities ourselves.
- We must comply with any additional provisions set forth in the prospectus
supplement.
If we accomplish a full defeasance, as described above, you would have to
rely solely on the trust deposit for repayment on the debt securities. You could
not look to us or our subsidiary guarantors for repayment in the unlikely event
of any shortfall. Conversely, the trust deposit would most likely be protected
from claims of our lenders and other creditors if we ever become bankrupt or
insolvent. You would also be released from any applicable subordination
provisions on the subordinated debt securities described below under
"-- Subordination."
COVENANT DEFEASANCE. Under current federal tax law, we can make the same
type of deposit described above and be released and cause our subsidiary
guarantors to be released, from the restrictive covenants in the debt
securities, if any. This is called "covenant defeasance." In that event, you
would lose the protection of those restrictive covenants but would gain the
protection of having money and securities set aside in trust to repay the debt
securities, and you would be released from any applicable subordination
provisions on the subordinated debt securities described later under
"-- Subordination." In order to achieve covenant defeasance, we must do the
following:
- We must deposit in trust for your benefit and the benefit of all other
registered holders of the debt securities a combination of money and U.S.
government or U.S. government agency notes or bonds that will generate
enough cash to make interest, principal and any other payments on the
debt securities on their various due dates.
- We must deliver to the trustee a legal opinion confirming that under
current federal income tax law we may make the above deposit without
causing you to be taxed on the debt securities any differently than if we
did not make the deposit and just repaid the debt securities ourselves.
- We must comply with any additional provisions set forth in the prospectus
supplement.
If we accomplish covenant defeasance, the following provisions of the
indenture and the debt securities would no longer apply unless otherwise
specified:
- any promises of our subsidiary guarantors relating to their guarantees,
the conduct of their business and any other covenants applicable to the
series of debt securities that will be described in the prospectus
supplement;
- our promises regarding conduct of our business and other matters and any
other covenants applicable to the series of debt securities that will be
described in the prospectus supplement; and
- the definition of an event of default as a breach of such covenants that
may be specified in the prospectus supplement.
If we accomplish covenant defeasance, you can still look to us and our
subsidiary guarantors for repayment of the debt securities if there were a
shortfall in the trust deposit. In fact, if one of the remaining events of
default occurred (such as our bankruptcy) and the debt securities become
immediately due and payable, there may be such a shortfall. Depending on the
event causing the default, of course, you may not be able to obtain payment of
the shortfall.
In order to exercise either full defeasance or covenant defeasance, we must
comply with certain conditions, and no event or condition can exist that would
prevent us and our subsidiary guarantors from making payments of principal,
premium, and interest, if any, on the senior debt securities or subordinated
debt securities of such series on the date the irrevocable deposit is made or at
any time during the period ending on the 91st day after the deposit date.
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RANKING
Unless provided otherwise in the applicable prospectus supplement, the debt
securities are not secured by any of our property or assets. Accordingly, your
ownership of debt securities means you are one of our unsecured creditors. The
senior debt securities are not subordinated to any of our other debt obligations
and therefore they rank equally with all our other unsecured and unsubordinated
indebtedness. The subordinated debt securities are subordinated to some of our
existing and future debt and other liabilities. See "-- Subordination" for
additional information on how subordination limits your ability to receive
payment or pursue other rights if we default or have certain other financial
difficulties. In addition, the senior and subordinated debt securities, if they
are not guaranteed by our subsidiaries, will be effectively subordinated to the
indebtedness of our subsidiaries.
SUBORDINATION
Unless the prospectus supplement provides otherwise, the following
provisions will apply to the subordinated debt securities:
The payment of principal, any premium and interest on the subordinated debt
securities is subordinated in right of payment to the prior payment in full of
all of our senior indebtedness. This means that in certain circumstances where
we may not be making payments on all of our debt obligations as they become due,
the holders of all of our senior indebtedness will be entitled to receive
payment in full of all amounts that are due or will become due on the senior
indebtedness before you and the other holders of subordinated debt securities
will be entitled to receive any payment or distribution (other than in the form
of subordinated securities) on the subordinated debt securities. These
circumstances include the following circumstances:
- We make a payment or distribute assets to creditors upon any liquidation,
dissolution, winding up or reorganization of our company, or as part of
an assignment or marshalling of our assets for the benefit of our
creditors.
- We file for bankruptcy or certain other events in bankruptcy, insolvency
or similar proceedings occur.
- The maturity of the subordinated debt securities is accelerated. For
example, the entire principal amount of a series of subordinated debt
securities may be declared to be due and payable and immediately payable
or may be automatically accelerated due to an event of default as
described under "-- Events of Default."
In addition, we are generally not permitted to make payments of principal,
any premium or interest on the subordinated debt securities if we default in our
obligation to make payments on our senior indebtedness and do not cure such
default. We are also prohibited from making payments on subordinated debt
securities if an event of default (other than a payment default) that permits
the holders of senior indebtedness to accelerate the maturity of the senior
indebtedness occurs and we and the trustee have received a notice of such event
of default. However, unless the senior indebtedness has been accelerated because
of that event of default, this payment blockage notice cannot last more than 179
days.
These subordination provisions mean that if we are insolvent a holder of
senior indebtedness is likely to ultimately receive out of our assets more than
a holder of the same amount of our subordinated debt securities, and a creditor
of our company that is owed a specific amount but who owns neither our senior
indebtedness nor our subordinated debt securities may ultimately receive less
than a holder of the same amount of senior indebtedness and more than a holder
of subordinated debt securities.
The subordinated indenture does not limit the amount of senior indebtedness
we are permitted to have and we may in the future incur additional senior
indebtedness.
"Senior indebtedness" is defined in the subordinated indenture as the
principal of, and premium, if any, and unpaid interest on
- indebtedness of Quest Diagnostics whether outstanding on the date of the
subordinated indenture or thereafter created, incurred, assumed or
guaranteed, for money borrowed, unless in the instrument creating or
evidencing the same or pursuant to which the same is outstanding it is
provided that
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such indebtedness is not senior or prior in right of payment to the
subordinated debt securities. This includes the indebtedness of others
guaranteed by Quest Diagnostics but excludes the debt securities Quest
Diagnostics issued under the subordinated indenture and the 10 3/4%
senior subordinated notes due 2006 of Quest Diagnostics, and
- renewals, extensions, modifications and refunding of any such
indebtedness.
If this prospectus is being delivered in connection with a series of
subordinated securities, the accompanying prospectus supplement or the
information incorporated by reference will set forth the approximate amount of
senior indebtedness outstanding as of a recent date.
THE TRUSTEE
The initial trustee under each indenture will be The Bank of New York. The
Bank of New York will also be the initial paying agent and registrar for the
debt securities. The Bank of New York is also the trustee and note registrar for
our 10 3/4% senior subordinated notes due 2006.
Each indenture provides that, except during the continuance of an event of
default under the indenture, the trustee under the indenture will perform only
such duties as are specifically set forth in the indenture. Under the indenture,
the holders of a majority in outstanding principal amount of the debt securities
will have the right to direct the time, method and place of conducting any
proceeding or exercising any remedy available to the trustee under the
indenture, subject to certain exceptions. If an event of default has occurred
and is continuing, the trustee under the indenture will exercise such rights and
powers vested in it under the indenture and use the same degree of care and
skill in its exercise as a prudent person would exercise under the circumstances
in the conduct of such person's own affairs.
Each indenture and provisions of the Trust Indenture Act incorporated by
reference in the indenture contain limitations on the rights of the trustee
under such indenture, should it become a creditor of our company, to obtain
payment of claims in certain cases or to realize on certain property received by
it in respect of any such claims, as security or otherwise. The trustee under
the indenture is permitted to engage in other transactions. However, if the
trustee under the indenture acquires any prohibited conflicting interest, it
must eliminate the conflict or resign.
Each trustee may resign or be removed with respect to one or more series of
securities and a successor trustee may be appointed to act with respect to such
series. In the event that two or more persons are acting as Trustee with respect
to different series of securities under one of the indentures, each such trustee
shall be a trustee of a trust separate and apart from the trust administered by
any other such trustee and any action described herein to be taken by the
"trustee" may then be taken by each such trustee with respect to, and only with
respect to, the one or more series of securities for which it is trustee.
GOVERNING LAW
The indentures and the debt securities will be governed by, and construed
in accordance with, the laws of the State of New York.
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DESCRIPTION OF THE PREFERRED STOCK
AND THE DEPOSITARY SHARES REPRESENTING
FRACTIONAL SHARES OF PREFERRED STOCK
This section describes the general terms and provisions of the preferred
stock that we may offer by this prospectus. The applicable prospectus supplement
will describe the specific terms of the series of preferred stock then offered,
and the terms and provisions described in this section will apply only to the
extent not superseded by the terms of the applicable prospectus supplement.
This section is only a summary of the preferred stock that we may offer. We
urge you to read carefully our certificate of incorporation and the certificate
of designation we will file in relation to an issue of any particular series of
preferred stock before you buy any preferred stock.
BOOK-ENTRY SECURITIES
The preferred stock may be issued in whole or in part in the form of one or
more global securities. See "Securities We May Issue" for additional information
about your limited rights as the beneficial owner of a global security.
OUR SERIES OF PREFERRED STOCK
Our certificate of incorporation permits us to issue, without prior
permission from our stockholders, up to 10,000,000 shares of preferred stock. As
of June 1, 2001, we had previously authorized:
- 1,000 shares of voting cumulative preferred stock, par value $1.00 per
share, all of which are issued and outstanding; and
- 1,300,000 shares of series A preferred stock par value $1.00 per share,
none of which are expected to be issued nor are any outstanding; series A
preferred stock will be issued pursuant to our rights agreement as
described under "Description of Common Stock -- Rights Agreement."
VOTING CUMULATIVE PREFERRED STOCK
We have 1,000 outstanding shares of voting cumulative preferred stock, all
of which are owned by Corning Incorporated. The shares of our voting cumulative
preferred stock rank senior to our common stock and series A preferred stock;
they have a liquidation preference of $1,000 per share over the shares of our
common stock and receive quarterly dividends payable in cash at the greater of
(1) 10% per annum or (2) the yield to maturity of our 10 3/4% notes expressed as
a percentage plus 1%. The voting cumulative preferred stock has one vote per
share and votes together with our common stock as a single class. The voting
cumulative preferred stock also votes as a separate class on any amendment to
our certificate of incorporation that adversely affects the rights of such
preferred stock, subject to certain exceptions. We may redeem all the shares of
our voting cumulative preferred stock beginning on January 1, 2003. The initial
redemption price is 106% of the liquidation preference per share, plus accrued
and unpaid dividends. The redemption price will decline each year after 2003 and
will be 100% of the liquidation preference, plus accrued and unpaid dividends,
on or after January 1, 2006. On January 1, 2022, we must redeem all of the then
outstanding shares of voting cumulative preferred stock at a redemption price
equal to the liquidation preference.
TERMS OF FUTURE SERIES OF PREFERRED STOCK
Our board of directors may, without further action of the stockholders,
issue undesignated preferred stock in one or more classes or series. Any
undesignated preferred stock issued by us may:
- rank prior to our common stock as to dividend rights, liquidation
preference or both;
- have full or limited voting rights; and
- be convertible into shares of common stock or other securities.
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The powers, designations, preferences and relative, participating, optional
or other special rights, and qualifications, limitations or restrictions,
including dividend rights, voting rights, conversion rights, terms of redemption
and liquidation preferences, of the preferred stock of each series will be fixed
or designated by our board of directors pursuant to a certificate of
designation. We will describe in the applicable prospectus supplement the
specific terms of a particular series of preferred stock, which may include the
following:
- the maximum number of shares in the series;
- the designation of the series;
- the terms of any voting rights of the series;
- the dividend rate, if any, on the shares of such series, the conditions
and dates upon which such dividends shall be payable, the preference or
relation which such dividends shall bear to the dividends payable on any
other class or classes or on any other series of capital stock, and
whether such dividends shall be cumulative or non-cumulative;
- whether the shares of such series shall be redeemable by us and, if so,
the times, prices and other terms and conditions of such redemption;
- the rights of the holders of shares of such series upon the liquidation,
dissolution or winding up of our company;
- whether or not the shares of such series shall be subject to the
operation of a retirement or sinking fund and, if so, the extent to and
manner in which any such retirement or sinking fund shall be applied to
the purchase or redemption of the shares of such series for retirement or
to other corporate purposes and the terms and provisions relative to the
operation thereof;
- whether or not the shares of such series shall be convertible into, or
exchangeable for, (a) our debt securities, (b) shares of any other class
or classes of stock of our company, or of any other series of the same or
different class of stock, or (c) shares of any class or series of stock
of any other corporation, and if so convertible or exchangeable, the
price or prices or the rate or rates of conversion or exchange and the
method, if any, of adjusting the same;
- the limitations and restrictions, if any, to be effective while any
shares of such series are outstanding upon the payment of dividends or
making of other distributions on, and upon the purchase, redemption or
other acquisition by our company of, our common stock, or any other class
or classes of stock of our company ranking junior to the shares of such
series either as to dividends or upon liquidation;
- the conditions or restrictions, if any, upon the creation of indebtedness
of our company or upon the issue of any additional stock, including
additional shares of such series or of any other series or of any other
class, ranking on a parity with or prior to the shares of such series as
to dividends or distribution of assets on liquidation, dissolution or
winding up;
- whether fractional interests in shares of the series will be offered in
the form of depositary shares as described below under "-- Depositary
Shares";
- any other preference or provision and relative, participating, optional
or other special rights or qualifications, limitations or restrictions
thereof; and
- our ability to modify the rights of holders otherwise than by a vote of a
majority or more of the series outstanding.
The preferred stock will, when issued, be fully paid and nonassessable. We
will select the transfer agent, registrar and dividend disbursement agent for a
series of preferred stock and will describe its selection in the applicable
prospectus supplement. The registrar for shares of preferred stock will send
notices to stockholders of any meetings at which holders of the preferred stock
have the right to elect directors of our company or to vote on any other matter
of our company.
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DEPOSITARY SHARES
This section describes the general terms and provisions of the depositary
shares we may offer. The applicable prospectus supplement will describe the
specific terms of the depositary shares offered through that prospectus
supplement, including, but not limited to, the title of the depositary shares
and the deposited security, the amount of deposited securities represented by
one depositary share, and any general terms outlined in this section that will
not apply to those depositary shares.
We have summarized certain terms and provisions of the depositary
agreement, the depositary shares and the depositary receipts in this section.
The summary is not complete. We will file the form of depositary agreement,
including the form of depositary receipt, as an exhibit to the registration
statement, of which this prospectus is a part. You should read the forms of
depositary agreement and depositary receipt relating to a series of preferred
stock for additional information before you buy any depositary shares that
represent preferred stock of such series.
GENERAL. We may offer fractional interests in preferred stock rather than
full shares of preferred stock. If this occurs, we will provide for the issuance
by a depositary to the public of receipts for depositary shares, each of which
will represent a fractional interest in a share of a particular series of
preferred stock.
The stock of any series of preferred stock underlying the depositary shares
will be deposited under a separate depositary agreement between us and a
depositary. For these purposes, the depositary will be a bank or trust company
having its principal office in the United States and having a combined capital
and surplus of at least $50 million. We will name the depositary and give the
address of its principal executive office in the applicable prospectus
supplement. Subject to the terms of the depositary agreement, each owner of a
depositary share will have a fractional interest in all the rights and
preferences of the preferred stock underlying such depositary shares. Those
rights include any dividend, voting, redemption, conversion and liquidation
rights.
The depositary shares will be evidenced by depositary receipts issued under
the depositary agreement. If you purchase fractional interests in shares of the
related series of preferred stock, you will receive depositary receipts as
described in the applicable prospectus supplement. While the final depositary
receipts are being prepared, we may order the depositary to issue temporary
depositary receipts substantially identical to the final depositary receipts in
final form. The holders of the temporary depositary receipts will be entitled to
the same rights as if they held the depositary receipts although not in final
form. Holders of the temporary depositary receipts can exchange them for the
final depositary receipts at our expense.
If you surrender depositary receipts at the principal office of the
depositary, unless the related depositary shares have previously been called for
redemption, you are entitled to receive at such office the number of shares of
preferred stock and any money or other property represented by such depositary
shares. We will not issue partial shares of preferred stock. If you deliver
depositary receipts evidencing a number of depositary shares that represent more
than a whole number of shares of preferred stock, the depositary will issue you
a new depositary receipt evidencing such excess number of depositary shares at
the same time that the shares of preferred stock are withdrawn. Holders of
preferred stock received in exchange for depositary shares will no longer be
entitled to deposit such shares under the depositary agreement or to receive
depositary shares in exchange for such preferred stock.
DIVIDENDS AND OTHER DISTRIBUTIONS. The depositary will distribute all cash
dividends or other distributions received with respect to the preferred stock to
the record holders of depositary shares representing the preferred stock in
proportion to the number of depositary shares owned by the holders on the
relevant record date. The depositary will distribute only the amount that can be
distributed without attributing to any holder of depositary shares a fraction of
one cent. THE BALANCE NOT DISTRIBUTED WILL BE ADDED TO AND TREATED AS PART OF
THE NEXT SUM RECEIVED BY THE DEPOSITARY FOR DISTRIBUTION TO RECORD HOLDERS OF
DEPOSITARY SHARES.
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If there is a distribution other than in cash, the depositary will
distribute property to the holders of depositary shares, unless the depositary
determines that it is not feasible to make such distribution. If this occurs,
the depositary may, with our approval, sell the property and distribute the net
proceeds from the sale to the holders of depositary shares.
The depositary agreement will also contain provisions relating to how any
subscription or similar rights offered by us to the holders of the preferred
stock will be made available to the holders of depositary shares.
CONVERSION AND EXCHANGE. If any series of preferred stock underlying the
depositary shares is subject to conversion or exchange, the applicable
prospectus supplement will describe the rights or obligations of each record
holder of depositary receipts to convert or exchange the depositary shares.
REDEMPTION OF DEPOSITARY SHARES. If the series of the preferred stock
underlying the depositary shares is subject to redemption, the depositary shares
will be redeemed from the redemption proceeds, in whole or in part, of such
series of the preferred stock held by the depositary. The depositary will mail
notice of redemption between 30 to 60 days prior to the date fixed for
redemption to the record holders of the depositary shares to be redeemed at
their addresses appearing in the depositary's records. The redemption price per
depositary share will bear the same relationship to the redemption price per
share of preferred stock that the depositary share bears to the underlying
preferred share. Whenever we redeem preferred stock held by the depositary, the
depositary will redeem, as of the same redemption date, the number of depositary
shares representing the preferred stock redeemed. If less than all the
depositary shares are to be redeemed, the depositary shares to be redeemed will
be selected by lot or pro rata as determined by the depositary.
After the date fixed for redemption, the depositary shares called for
redemption will no longer be outstanding. When the depositary shares are no
longer outstanding, all rights of the holders will cease, except the right to
receive money or other property that the holders of the depositary shares were
entitled to receive upon such redemption. Such payments will be made when
holders surrender their depositary receipts to the depositary.
VOTING THE PREFERRED STOCK. Upon receipt of notice of any meeting at which
the holders of the preferred stock are entitled to vote, the depositary will
mail information about the meeting contained in the notice to the record holders
of the depositary shares relating to such preferred stock. Each record holder of
such depositary shares on the record date, which will be the same date as the
record date for the preferred stock, will be entitled to instruct the depositary
as to how the preferred stock underlying the holder's depositary shares should
be voted.
The depositary will try, if practical, to vote the number of shares of
preferred stock underlying the depositary shares according to the instructions
received. We will agree to take all action requested and deemed necessary by the
depositary in order to enable the depositary to vote the preferred stock in that
manner. The depositary will not vote any preferred stock for which it does not
receive specific instructions from the holder of the depositary shares relating
to such preferred stock.
TAXATION. Provided that each obligation in the depositary agreement and
any related agreement is performed in accordance with its terms, owners of
depositary shares will be treated for federal income tax purposes as if they
were owners of the shares of preferred stock represented by the depositary
shares. Accordingly, for federal income tax purposes they will have the income
and deductions to which they would be entitled if they were holders of the
preferred stock. In addition:
- No gain or loss will be recognized for federal income tax purposes upon
withdrawal of preferred stock in exchange for depositary shares as
provided in the depositary agreement.
- The tax basis of each share of preferred stock to an exchanging owner of
depositary shares will, upon the exchange, be the same as the aggregate
tax basis of the depositary shares exchanged for such preferred stock.
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- The holding period for the preferred stock, in the hands of an exchanging
owner of depositary shares who held the depositary shares as a capital
asset at the time of the exchange, will include the period that the owner
held such depositary shares.
AMENDMENT AND TERMINATION OF THE DEPOSITARY AGREEMENT. The form of
depositary receipt evidencing the depositary shares and any provision of the
depositary agreement may be amended by agreement between our company and the
depositary at any time. However, any amendment that materially and adversely
alters the rights of the existing holders of depositary shares will not be
effective unless approved by the record holders of at least a majority of the
depositary shares then outstanding. A depositary agreement may be terminated by
us or the depositary only if:
- All outstanding depositary shares relating to the depositary agreement
have been redeemed.
- There has been a final distribution on the preferred stock of the
relevant series in connection with the liquidation, dissolution or
winding up of the business and the distribution has been distributed to
the holders of the related depositary shares.
CHARGES OF DEPOSITARY. We will pay all transfer and other taxes and
governmental charges arising solely from the existence of the depositary
arrangements. We will pay associated charges of the depositary for the initial
deposit of the preferred stock and any redemption of the preferred stock.
Holders of depositary shares will pay transfer and other taxes and governmental
charges and any other charges that are stated to be their responsibility in the
depositary agreement.
MISCELLANEOUS. We will forward to the holders of depositary shares all
reports and communications that it must furnish to the holders of the preferred
stock.
Neither the depositary nor we will be liable if the depositary is prevented
or delayed by law or any circumstance beyond its control in performing its
obligations under the depositary agreement. Our obligations and the depositary's
obligations under the depositary agreement will be limited to performance in
good faith of duties set forth in the depositary agreement. Neither the
depositary nor we will be obligated to prosecute or defend any legal proceeding
connected with any depositary shares or preferred stock unless satisfactory
indemnity is furnished to us or the depositary. We and the depositary may rely
upon written advice of counsel or accountants, or information provided by
persons presenting preferred stock for deposit, holders of depositary shares or
other persons believed to be competent and on documents believed to be genuine.
RESIGNATION AND REMOVAL OF DEPOSITARY. The depositary may resign at any
time by delivering notice to us. We may also remove the depositary at any time.
Resignations or removals will take effect upon the appointment of a successor
depositary and its acceptance of the appointment. The successor depositary must
be appointed within 60 days after delivery of the notice of resignation or
removal and must be a bank or trust company having its principal office in the
United States and having a combined capital and surplus of at least $50 million.
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DESCRIPTION OF COMMON STOCK
Our authorized capital stock consists of 300,000,000 shares of common
stock, par value $0.01 per share, and 10,000,000 shares of preferred stock, par
value $1.00 per share. As of June 1, 2001, there were 94,316,052 shares of
common stock outstanding held of record by approximately 6,800 stockholders, and
1,000 shares of preferred stock outstanding held of record by Corning
Incorporated. The following description of our common stock and provisions of
our certificate of incorporation and bylaws are only summaries and we encourage
you to review complete copies of our certificate of incorporation and bylaws,
which we have previously filed with the SEC.
COMMON STOCK
Holders of our common stock are entitled to receive, as, when and if
declared by our board of directors, dividends and other distributions in cash,
stock or property from our assets or funds legally available for those purposes
subject to any dividend preferences that may be attributable to preferred stock.
Holders of common stock are entitled to one vote for each share held of record
on all matters on which stockholders may vote. Holders of common stock are not
entitled to cumulative voting for the election of directors. There are no
preemptive, conversion, redemption or sinking fund provisions applicable to our
common stock. All outstanding shares of our common stock are fully paid and
non-assessable. In the event of our liquidation, dissolution or winding up,
holders of common stock are entitled to share ratably in the assets available
for distribution, subject to any prior rights of any holders of preferred stock
then outstanding.
Our common stock is traded on the New York Stock Exchange under the symbol
"DGX."
DELAWARE LAW AND OUR CERTIFICATE OF INCORPORATION AND BYLAW PROVISIONS MAY HAVE
AN ANTI-TAKEOVER EFFECT
Provisions in our certificate of incorporation, bylaws and Delaware law
could make it harder for someone to acquire us through a tender offer, proxy
contest or otherwise. We are governed by the provisions of Section 203 of the
Delaware General Corporate Law, which provides that a person who owns (or within
three years, did own) 15% or more of a company's voting stock is an "interested
stockholder." Section 203 prohibits a public Delaware corporation from engaging
in a business combination with an interested stockholder for a period commencing
three years from the date in which the person became an interested stockholder
unless:
- the board of directors approved the transaction which resulted in the
stockholder becoming an interested stockholder;
- upon consummation of the transaction which resulted in the stockholder
becoming an interested stockholder, the interested stockholder owns at
least 85% of the voting stock of the corporation (excluding shares owned
by officers, directors, or certain employee stock purchase plans); or
- at or subsequent to the time the transaction is approved by the board of
directors, there is an affirmative vote of at least 66.67% of the
outstanding voting stock.
Section 203 could prohibit or delay mergers or other takeover attempts
against us, and accordingly, may discourage attempts to acquire us through
tender offer, proxy contest or otherwise.
Our certificate of incorporation and bylaws include certain restrictions on
who may call a special meeting of stockholders and prohibit certain actions by
written consent of the holders of common stock. These provisions could delay,
deter or prevent a future takeover or acquisition of us unless such takeover or
acquisition is approved by the board of directors. We have a staggered board of
directors, so that it would take three successive annual meetings to replace all
directors. Our certificate of incorporation also requires the approval of
holders of at least 80% of the voting power of the outstanding capital stock of
our company entitled to vote generally in the election of directors as a
condition for mergers and certain other business combinations with any
beneficial owner of more than 10% of such voting power or an interested
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stockholder, unless (1) the transaction is approved by at least a majority of
directors which are not affiliated or associated with the interested stockholder
with whom we are seeking a business combination or (2) certain minimum price,
form of consideration and procedural requirements are met.
RIGHTS AGREEMENT
On December 31, 1996, we adopted a shareholder rights agreement. As with
most shareholder rights agreements, the terms of our rights agreement are
complex and not easily summarized. This summary may not contain all of the
information that is important to you. Accordingly, you should carefully read our
rights agreement, as amended, that is incorporated by reference as an exhibit to
the registration statement of which this prospectus is a part.
Our rights agreement provides that each of our common shares will have the
right to purchase a unit consisting of one-hundredth of our series A preferred
stock at a purchase price of $250. Each share of series A preferred stock is
entitled to 100 votes per share and votes together with our common stock as a
single class. The series A preferred stock is not redeemable. Holders of rights
will have no rights as our stockholders, including the right to vote or receive
dividends, simply by virtue of holding the rights.
Initially, the rights under our rights agreement are attached to
outstanding certificates representing our common shares and no separate
certificates representing the rights will be distributed. The rights will
separate from our common shares and be represented by separate certificates
approximately 10 days after someone acquires or commences a tender or exchange
offer for 20% of our outstanding common stock except in the case of SmithKline
Beecham and its affiliates, who may acquire up to 29.5% of our outstanding
common stock without triggering the separation of the rights from our common
stock.
After the rights separate from our common shares, certificates representing
the rights will be mailed to record holders of our common shares. Once
distributed, the rights certificates alone will represent the rights. All of our
common shares issued prior to the date the rights separate from the common
shares will be issued with the rights attached. The rights are not exercisable
until the date the rights separate from the common shares. The rights will
expire on December 31, 2006 unless earlier redeemed or exchanged by us.
If a person or group obtains or has the right to obtain 20% or more of our
common shares, then each holder of a right shall be entitled to receive common
stock in lieu of the series A preferred stock upon exercise of the right and
payment of the purchase price. The number of shares of common stock the holder
of the right shall be entitled to receive shall have a value equal to two times
the purchase price paid by such holder upon exercise of the right, unless our
board of directors exercises its option pursuant to the rights agreement to
exchange all or part of the outstanding rights for common stock at an exchange
ratio of one common stock per right prior to a person or group beneficially
owning 50% or more of our common shares. If our company is acquired in a merger,
consolidation or other business combination or more than 50% of our assets is
sold or transferred, each right will thereafter entitle the holder thereof to
receive, upon the exercise of such right, common stock of the acquiring
corporation having a value equal to two times the purchase price of such right.
Our rights agreement may have anti-takeover effects. The rights may cause
substantial dilution to a person or group that attempts to acquire us.
Accordingly, the existence of the rights may deter acquirors from making
takeover proposals or tender offers. However, the rights are not intended to
prevent a takeover, but rather are designed to enhance the ability of our board
to negotiate with an acquiror on behalf of all the stockholders. In addition,
the rights should not interfere with a proxy contest.
LIMITATIONS ON LIABILITY AND INDEMNIFICATION OF OFFICERS AND DIRECTORS
Our certificate of incorporation limits the liability of directors to the
fullest extent permitted by Delaware law. Delaware law provides that directors
of a corporation will not be personally liable for
34
42
monetary damages for breach of their fiduciary duties as directors, including,
without limitation, directors serving on committees of our board of directors.
Directors remain liable for:
- any breach of the director's duty of loyalty to our or its stockholders;
- any act or omission not in good faith or which involves intentional
misconduct or a knowing violation of the law;
- any violation of Section 174 of the DGCL, which proscribes the payment of
dividends and stock purchases or redemptions under certain circumstances;
and
- any transaction from which the directors derive an improper personal
benefit.
This provision, however, has no effect on the availability of equitable
remedies such as an injunction or rescission. Additionally, this provision will
not limit liability under state or federal securities laws.
The certificate of incorporation provides that we shall indemnify our
officers and directors to the fullest extent permitted by such law. We believe
that these provisions will assist us in attracting and retaining qualified
individuals to serve as directors.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for our common stock is Computershare
Investors Services LLC, 2 North LaSalle Street, Chicago, Illinois 60602, and its
telephone number at this location is (312) 588-4991.
35
43
SELLING STOCKHOLDER
We have registered 3,000,000 shares of our common stock that may be offered
by SmithKline Beecham in the registration statement of which this prospectus is
a part. As of June 1, 2001, these shares represented 3.2% of the outstanding
shares of our common stock and SmithKline Beecham held 22,128,672 shares of our
common stock, representing approximately 23.5% of the outstanding shares of our
common stock.
In a letter agreement dated as of January 22, 2001, SmithKline Beecham has
agreed that (1) it will not offer or sell any shares of common stock pursuant to
such registration statement other than as part of an underwritten public
offering; (2) the maximum number of shares of common stock that it will sell
pursuant to such registration statement will equal the lesser of (a) 3,000,000
shares of common stock or (b) such number of shares of common stock having an
aggregate offering price of $225 million; and (3) it will not make more than one
offering of common stock pursuant to such registration statement. Since
SmithKline Beecham may sell all or some of its shares of common stock that have
been registered pursuant to such registration statement, no estimate can be made
of the aggregate number of shares of common stock that will be owned by
SmithKline Beecham upon completion of any such sale.
36
44
PLAN OF DISTRIBUTION
We may sell the securities and SmithKline Beecham may sell shares of our
common stock that it owns to one or more underwriters for public offering or to
investors directly or through agents. The name of any such underwriter or agent
involved in the offer and sale of the securities, the amounts underwritten and
the nature of its obligation to take the securities will be named in the
applicable prospectus supplement. We have reserved the right to sell the
securities, and SmithKline Beecham has reserved the right to sell shares of our
common stock that it owns, directly to investors on our own behalf in those
jurisdictions where we are authorized to do so. The sale of the securities may
be effected in transactions (a) on any national or international securities
exchange or quotation service on which the securities may be listed or quoted at
the time of sale, (b) in the over-the-counter market, (c) in transactions
otherwise than on such exchanges or in the over-the-counter market or (d)
through the writing of options. In a letter agreement dated as of January 22,
2001, SmithKline Beecham has agreed that it will not offer or sell any common
stock pursuant to this prospectus other than as part of an underwritten public
offering.
Underwriters may offer and sell the securities at a fixed price or prices
that may be changed, at market prices prevailing at the time of sale, at prices
related to such prevailing market prices or at negotiated prices. They may offer
the securities on an exchange, which will be disclosed in the applicable
prospectus supplement. We and SmithKline Beecham also may, from time to time,
authorize dealers, acting as our agents, to offer and sell the securities, and
in the case of SmithKline Beecham, our common stock, upon such terms and
conditions as set forth in the applicable prospectus supplement. In connection
with the sale of the securities, underwriters may receive compensation from us
and SmithKline Beecham in the form of underwriting discounts or commissions and
may also receive commissions from purchasers of the securities for whom they may
act as agent. Underwriters may sell the securities to or through dealers, and
such dealers may receive compensation in the form of discounts, concessions or
commissions from the underwriters or commissions (which may be changed from time
to time) from the purchasers for whom they may act as agents.
Any underwriting compensation paid by our company and SmithKline Beecham to
underwriters or agents in connection with the offering of the securities, and
any discounts, concessions or commissions allowed by underwriters to
participating dealers, will be set forth in the applicable prospectus
supplement. SmithKline Beecham, dealers and agents participating in the
distribution of the securities may be deemed to be underwriters, and any
discounts and commissions received by them and any profit realized by them on
resale of the securities may be deemed to be underwriting discounts and
commissions under the Securities Act. Underwriters, dealers and agents may be
entitled, under agreements entered into with our company and SmithKline Beecham,
to indemnification against and contribution towards certain civil liabilities,
including any liabilities under the Securities Act.
Until the distribution of the securities is completed, rules of the SEC may
limit the ability of the underwriters to bid for and purchase the securities. As
an exception to these rules, the underwriters are permitted to engage in certain
transactions that stabilize the price of the securities. Such transactions
consist of bids or purchases for the purpose of pegging, fixing or maintaining
the price of the securities. If the underwriters create a short position in the
securities in connection with the offering, i.e., if they sell more securities
than are set forth on the cover page of the applicable prospectus supplement,
the underwriters may reduce that short position by purchasing securities in the
open market. The underwriters may also impose a penalty bid on certain
underwriters. This means that if the underwriters purchase the securities in the
open market to reduce the underwriters' short position or to stabilize the price
of the securities, they may reclaim the amount of the selling concession from
the underwriters who sold those securities as part of the offering. In general,
purchases of a security for the purpose of stabilization or to reduce a short
position could cause the price of the security to be higher than it might be in
the absence of such purchases. The imposition of a penalty bid might also have
an effect on the price of a security to the extent that it were to discourage
resales of the security.
Any securities other than our common stock issued hereunder may be new
issues of securities with no established trading market. Any underwriters or
agents to or through whom such securities are sold for
37
45
public offering and sale may make a market in such securities, but such
underwriters or agents will not be obligated to do so and may discontinue any
market making at any time without notice. No assurance can be given as to the
liquidity of the trading market for any such securities. The amount of expenses
expected to be incurred by us in connection with any issuance of securities will
be set forth in the prospectus supplement. Certain of the underwriters, dealers
or agents and their associates may engage in transactions with, and perform
services for, our company, SmithKline Beecham and certain of our affiliates and
SmithKline Beecham's affiliate's in the ordinary course.
VALIDITY OF THE SECURITIES
The validity of any securities issued hereunder will be passed upon for our
company by Shearman & Sterling, New York, New York. Unless otherwise indicated
in the applicable prospectus supplement, the validity of any securities issued
hereunder will be passed upon for any agents or underwriters by Fried, Frank,
Harris, Shriver & Jacobson (a partnership including professional corporations),
New York, New York.
INDEPENDENT ACCOUNTANTS
The consolidated financial statements of Quest Diagnostics Incorporated and
subsidiaries as of December 31, 2000 and 1999, and for each of the years in the
three-year period ended December 31, 2000, have been incorporated by reference
into this prospectus in reliance upon the report of PricewaterhouseCoopers LLP,
independent accountants, given upon the authority of said firm as experts in
accounting and auditing.
The combined balance sheets at December 31, 1998 and 1997 and the related
combined statements of operations, changes in parent's equity and cash flows for
each of the three years ended December 31, 1998, of SmithKline Beecham Clinical
Laboratories, Inc. and Certain Related Affiliates' have been incorporated by
reference into this prospectus in reliance upon the report of
PricewaterhouseCoopers LLP, independent accountants, given upon the authority of
said firm as experts in accounting and auditing.
38
46
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth all fees and expenses payable by the
registrant in connection with the issuance and distribution of the securities
being registered hereby (other than underwriting discounts and commissions). All
of such expenses, except the SEC registration fee, are estimated.
Securities and Exchange Commission registration fee......... $ 187,500
NYSE listing fee............................................ $ 65,000
Legal fees and expenses..................................... $ 200,000
Transfer Agent's fees and expenses.......................... $ 10,000
Trustee's fees and expenses................................. $ 20,000
Rating agency fees.......................................... $ 360,000
Accounting fees and expenses................................ $ 200,000
Blue Sky fees and expenses (including counsel fees)......... $ 10,000
Printing expenses........................................... $ 400,000
Miscellaneous............................................... $ 47,500
----------
Total............................................. $1,500,000
==========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
LIMITATION ON LIABILITY OF DIRECTORS
Pursuant to authority conferred by Section 102 of the Delaware General
Corporation Law (the "DGCL"), Paragraph 11 of our certificate of incorporation
(the "Certificate") eliminates the personal liability of directors to us or our
stockholders for monetary damages for breach of fiduciary duty, including,
without limitation, directors serving on committees of our board of directors
(the "Board"). Directors remain liable for (1) any breach of the duty of loyalty
to us or our stockholders, (2) any act or omission not in good faith or which
involves intentional misconduct or a knowing violation of law, (3) any violation
of Section 174 of the DGCL, which proscribes the payment of dividends and stock
purchases or redemptions under certain circumstances, and (4) any transaction
from which directors derive an improper personal benefit.
INDEMNIFICATION AND INSURANCE
In accordance with Section 145 of the DGCL, which provides for the
indemnification of directors, officers and employees under certain
circumstances, Paragraph 11 of the Certificate grants our directors and officers
a right to indemnification for all expenses, liabilities and losses relating to
civil, criminal, administrative or investigative proceedings to which they are a
party (1) by reason of the fact that they are or were our directors or officers
or (2) by reason of the fact that, while they are or were our directors or
officers, they are or were serving at our request as directors or officers of
another corporation, partnership, joint venture, trust or enterprise.
Paragraph 11 of the Certificate further provides for the mandatory
advancement of expenses incurred by officers and directors in defending such
proceedings in advance of their final disposition upon delivery to us by the
indemnitee of an undertaking to repay all amounts so advanced if it is
ultimately determined that such indemnitee is not entitled to be indemnified
under Paragraph 11. We may not indemnify or make advance payments to any person
in connection with proceedings initiated against us by such person without the
authorization of our board of directors.
II-1
47
In addition, Paragraph 11 of the Certificate provides that directors and
officers therein described shall be indemnified to the fullest extent permitted
by Section 145 of the DGCL, or any successor provisions or amendments
thereunder.
In the event that any such successor provisions or amendments provide
indemnification rights broader than permitted prior thereto, Paragraph 11 of the
Certificate allows such broader indemnification rights to apply retroactively
with respect to any predating alleged action or inaction and also allows the
indemnification to continue after an indemnitee has ceased to be our director or
officer and to inure to the benefit of the indemnitee's heirs, executors and
administrators.
Paragraph 11 of the Certificate further provides that the right to
indemnification is not exclusive of any other right that any indemnitee may have
or thereafter acquire under any statute, the Certificate, any agreement or vote
of stockholders or disinterested directors or otherwise, and allows us to
indemnify and advance expenses to any person whom the corporation has the power
to indemnify under the DGCL or otherwise.
Each of the form of underwriting agreement to be filed as Exhibits 1.1, 1.2
and 1.3 hereto will provide for the indemnification of the registrant, its
controlling persons, its directors and certain of its officers by the
underwriters against certain liabilities, including liabilities under the
Securities Act.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted for directors and officers and controlling persons pursuant to
the foregoing provisions, we have been advised that in the opinion of the SEC,
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable.
The Certificate authorizes us to purchase insurance for our directors and
officers and persons who serve at our request as directors, officers, employees
or agents of another corporation, partnership, joint venture, trust or
enterprise against any expense, liability or loss incurred in such capacity,
whether or not we would have the power to indemnify such persons against such
expense or liability under the DGCL. We intend to maintain insurance coverage of
our officers and directors as well as insurance coverage to reimburse us for
potential costs of our corporate indemnification of directors and officers.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENTS SCHEDULES.
The exhibits to this registration statement are listed in the Exhibit Index
to this registration statement, which Exhibit Index is hereby incorporated by
reference.
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(a)(1) To file, during any period in which offers or sales are being
made of the securities registered hereby, a post-effective
amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising
after the effective date of this registration statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement; provided, however, that notwithstanding the
foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered
would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus
filed with the Securities and Exchange Commission pursuant
to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20% change in the
maximum aggregate offering
II-2
48
price set forth in the "Calculation of Registration Fee" table
in the effective registration statement; and
(iii) to include any material information with respect to the
plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement;
provided, however, that the undertakings set forth in
clauses (i) and (ii) above do not apply if the information
required to be included in a post-effective amendment by
those clauses is contained in periodic reports filed by
the registrant pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934 that are incorporated
by reference in this registration statement;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof;
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering;
(b) That, for the purposes of determining any liability under the
Securities Act of 1933, each filing of our annual report pursuant to
Section 13(a) or 15(d) of the Securities and Exchange Act of 1934
(and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(a) of the Securities Exchange
Act of 1934) that is incorporated by reference in this registration
statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof; and
(c) To deliver or cause to be delivered with the prospectus, to each
person to whom the prospectus is sent or given, the latest annual
report to security holders that is incorporated by reference in the
prospectus and furnished pursuant to and meeting the requirements of
Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of 1934;
and, where interim financial information required to be presented by
Article 3 of Regulation S-X are not set forth in the prospectus, to
deliver, or cause to be delivered to each person to whom the
prospectus is sent or given, the latest quarterly report that is
specifically incorporated by reference in the prospectus to provide
such interim financial information.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers or persons controlling the
registrant, the registrant has been informed that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Securities Act of 1933 and is therefore unenforeceable.
The undersigned registrant hereby undertakes to file an application for the
purpose of determining the eligibility of the trustee to act under subsection
(a) of Section 310 of the Trust Indenture Act in accordance with the rules and
regulations prescribed by the Commission under Section 305(b)(2) of the Trust
Indenture Act.
II-3
49
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
QUEST DIAGNOSTICS INCORPORATED
By: *
------------------------------------
Kenneth W. Freeman, Chairman of
the Board and Chief Executive
Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chairman of the Board, Chief Executive
- -------------------------------------------------------- Officer and Director (principal executive
Kenneth W. Freeman officer)
* Corporate Vice President and Chief Financial
- -------------------------------------------------------- Officer (principal financial officer)
Robert A. Hagemann
* Vice President, Corporate Controller and
- -------------------------------------------------------- Chief Accounting Officer (chief accounting
Thomas F. Bongiorno officer)
* Director
- --------------------------------------------------------
Kenneth D. Brody
* Director
- --------------------------------------------------------
William F. Buehler
* Director
- --------------------------------------------------------
Van C. Campbell
* Director
- --------------------------------------------------------
Mary A. Cirillo
* Director
- --------------------------------------------------------
William R. Grant
* Director
- --------------------------------------------------------
Dan C. Stanzione
* Director
- --------------------------------------------------------
Gail R. Wilensky
* Director
- --------------------------------------------------------
John B. Ziegler
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-4
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
QUEST DIAGNOSTICS HOLDINGS
INCORPORATED
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer
- -------------------------------------------------------- (principal executive officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-5
51
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
QUEST DIAGNOSTICS CLINICAL
LABORATORIES, INC.
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer (principal executive
- -------------------------------------------------------- officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-6
52
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
QUEST DIAGNOSTICS INCORPORATED (CA)
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer (principal executive
- -------------------------------------------------------- officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-7
53
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
QUEST DIAGNOSTICS INCORPORATED (MD)
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer (principal executive
- -------------------------------------------------------- officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-8
54
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
QUEST DIAGNOSTICS LLC
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer (principal executive
- -------------------------------------------------------- officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-9
55
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
QUEST DIAGNOSTICS INCORPORATED (MI)
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer
- -------------------------------------------------------- (principal executive officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-10
56
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
QUEST DIAGNOSTICS INCORPORATED (CT)
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer
- -------------------------------------------------------- (principal executive officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-11
57
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
QUEST DIAGNOSTICS INCORPORATED (MA)
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer
- -------------------------------------------------------- (principal executive officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-12
58
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
QUEST DIAGNOSTICS OF
PENNSYLVANIA INC.
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer
- -------------------------------------------------------- (principal executive officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-13
59
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1.
QUEST DIAGNOSTICS INCORPORATED (OH)
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer
- -------------------------------------------------------- (principal executive officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-14
60
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
METWEST INC.
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer
- -------------------------------------------------------- (principal executive officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-15
61
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
NICHOLS INSTITUTE DIAGNOSTICS
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer
- -------------------------------------------------------- (principal executive officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-16
62
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
DPD HOLDINGS, INC.
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer
- -------------------------------------------------------- (principal executive officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-17
63
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
DIAGNOSTICS REFERENCE SERVICES INC.
By: *
------------------------------------
Kenneth W. Freeman, Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer
- -------------------------------------------------------- (principal executive officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-18
64
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
LABORATORY HOLDINGS INCORPORATED
By: *
------------------------------------
Kenneth W. Freeman, Chief Executive
Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* Chief Executive Officer
- -------------------------------------------------------- (principal executive officer)
Kenneth W. Freeman
* President and Director
- --------------------------------------------------------
Surya N. Mohapatra
* Vice President and Director
- --------------------------------------------------------
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-19
65
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
PATHOLOGY BUILDING PARTNERSHIP
By: Quest Diagnostics Incorporated
(MD),
General Partner
By: *
------------------------------------
Name: Kenneth W. Freeman
Title: Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
- --------- -----
* Chief Executive Officer of Quest Diagnostics
- -------------------------------------------------------- Incorporated (MD)
Kenneth W. Freeman
* President and Director of Quest Diagnostics
- -------------------------------------------------------- Incorporated (MD)
Surya N. Mohapatra
* Vice President and Director of Quest
- -------------------------------------------------------- Diagnostics Incorporated (MD)
Robert A. Hagemann
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-20
66
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
QUEST DIAGNOSTICS INVESTMENTS
INCORPORATED
By: *
------------------------------------
Peter C. Fulweiler, President
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* President and Director
- -------------------------------------------------------- (principal executive officer)
Peter C. Fulweiler
* Director
- --------------------------------------------------------
Louis Heidelberger
* Director
- --------------------------------------------------------
Robert S. Galen
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-21
67
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, we
certify that we have reasonable grounds to believe that we meet all of the
requirements for filing on Form S-3 and have duly caused this amendment no. 5 to
the registration statement to be signed on our behalf by the undersigned,
thereunto duly authorized, in The City of New York, State of New York, on June
1, 2001.
QUEST DIAGNOSTICS FINANCE INCORPORATED
By: *
------------------------------------
Peter C. Fulweiler, President
Pursuant to the requirements of the Securities Act of 1933, as amended,
this amendment no. 5 to the registration statement has been signed by the
following persons in the capacities indicated on June 1, 2001.
SIGNATURE TITLE
--------- -----
* President and Director
- -------------------------------------------------------- (principal executive officer)
Peter C. Fulweiler
* Director
- --------------------------------------------------------
Louis Heidelberger
* Director
- --------------------------------------------------------
Robert S. Galen
*By: /s/ LEO FARRENKOPF, JR. Attorney-in-Fact
---------------------------------------------------
Leo Farrenkopf, Jr.
II-22
68
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT
- ------- ----------------------
*1.1 Form of Underwriting Agreement for Common Stock.
*1.2 Form of Underwriting Agreement for Debt Securities.
*1.3 Form of Underwriting Agreement for Preferred Stock.
3.1 Certificate of Incorporation of Quest Diagnostics
Incorporated (filed as an exhibit to our registration
statement on Form 10 (File No. 1-12215) and incorporated
herein by reference).
3.2 Amendment to Certificate of Incorporation of Quest
Diagnostics Incorporated (filed as an exhibit to our proxy
statement on Schedule 14A dated April 12, 2000 and
incorporated herein by reference).
3.3 Amended and Restated By-Laws of Quest Diagnostics
Incorporated (filed as an exhibit to our 2000 annual report
on Form 10-K and incorporated herein by reference).
4.1 Form of Rights Agreement dated December 31, 1996 (the
"Rights Agreement") between our company and Harris Trust and
Savings Bank as Rights Agent (filed as an Exhibit to our
registration statement on Form 10 (File No. 1-12215) and
incorporated herein by reference).
4.2 Form of Amendment No. 1 effective as of July 1, 1999 to the
Rights Agreement (filed as an exhibit to our current report
on Form 8-K dated August 16, 1999 and incorporated herein by
reference).
4.3 Form of Amendment No. 2 to the Rights Agreement (filed as an
exhibit to our 1999 annual report on Form 10-K and
incorporated herein by reference).
**4.4 Form of Senior Indenture.
**4.5 Form of Subordinated Indenture.
**4.6 Form of Debt Security (included in the Senior Indenture and
the Subordinated Indenture).
*4.7 Form of Certificate of Designations.
*4.8 Form of Depositary Agreement.
*4.9 Form of Depositary Receipt (included in the Depositary
Agreement).
4.10 Form of Amendment No. 3 to the Rights Agreement (filed as an
exhibit to our 2000 annual report on Form 10-K and
incorporated herein by reference).
5.1 Opinion of Shearman & Sterling.
*8.1 Opinion of Shearman & Sterling as to tax matters.
**12.1 Computation of Ratio of Earnings to Fixed Charges and
Earnings to Combined Fixed Charges and Preferred Stock
Dividends.
23.1 Consents of Shearman & Sterling (included in Exhibit 5.1 and
Exhibit 8.1).
23.2 Consent of PricewaterhouseCoopers LLP, as independent
accountants for Quest Diagnostics Incorporated.
23.3 Consent of PricewaterhouseCoopers LLP, as independent
accountants for SmithKline Beecham Clinical Laboratories,
Inc. and Certain Related Affiliates.
**24.1 Powers of Attorney (included on signature page).
**25.1 Form T-1 Statement of Eligibility of the Senior Indenture
Trustee.
**25.2 Form T-1 Statement of Eligibility of the Subordinated
Indenture Trustee.
- ---------------
* To be filed by current report on Form 8-K.
** Previously filed.