Exhibit 8.1
June 24, 2002
Quest Diagnostics Incorporated
Xxx Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Agreement and Plan of Merger,
Dated as of April 2, 2002 and Amended as of May 13, 2002 and
as of June 20, 2002, Among Quest Diagnostics Incorporated,
Unilab Corporation and Quest Diagnostics Newco Incorporated
Ladies and Gentlemen:
We have acted as counsel for Quest Diagnostics Incorporated, a Delaware
corporation ("Parent"), in connection with the Offer and the Merger between
Unilab Corporation, a Delaware corporation ("Company"), and Quest Diagnostics
Newco Incorporated, a Delaware corporation (the "Merger Sub"), pursuant to an
Agreement and Plan of Merger, dated as of April 2, 2002 and amended as of May
13, 2002, among Parent, Merger Sub and the Company (the "Merger Agreement"). For
purposes of our opinion, we have assumed that the conditions to the consummation
of the Offer set forth in Annex I of the Merger Agreement (including the Minimum
Condition, as defined in Section 2.01(b)(1) of the Merger Agreement) will be
satisfied, none of the conditions permitting a Reverse Merger set forth in
Section 3.01(b)(A) and Section 3.01(b)(B) of the Merger Agreement will be
satisfied and the Merger will be consummated at the Effective Time as a forward
merger of the Company with and into Merger Sub in accordance with the terms of
the Merger Agreement and the laws of the State of Delaware. Any capitalized
terms used but not defined herein shall have the meaning assigned to them in the
Merger Agreement.
In connection with rendering our opinion, we have examined (i) the
Merger Agreement, the registration statement filed with the Securities and
Exchange Commission (the "Commission") by Parent on Form S-4 dated May 15, 2002,
as amended (the "Registration Statement"), with respect to the common stock of
Parent to be issued to certain Company stockholders pursuant to the Offer and
the Merger, including the prospectus constituting part of the Registration
Statement (the "Prospectus") and (ii) such other documents and corporate
Quest Diagnostics Incorporated 2 June 24, 2002
records as we have deemed necessary or appropriate for purposes of our opinion.
In addition, we have assumed that (i) the Offer and the Merger will be
consummated in accordance with the provisions of the Merger Agreement, (ii) the
representations and warranties contained in the Merger Agreement were true,
correct and complete when made and will continue to be true, correct and
complete through the Effective Time and (iii) the parties have complied with,
and, if applicable, will continue to comply with the covenants contained in the
Merger Agreement in all material respects. We have further assumed that the
statements as to factual matters contained in the Registration Statement and the
Prospectus are true, correct and complete, and will continue to be true, correct
and complete through the Effective Time.
In addition, we have relied on the representations made by Parent and
the Company in their respective letters of representation (the "Representation
Letters") delivered to us for purposes of this opinion pursuant to Section
8.10(b) of the Merger Agreement, and we have assumed that the representations
made therein will be true, correct and complete, and will be re-executed by
appropriate officers of Parent, as of the Effective Time. We have further
assumed that any representations made in the Representation Letters "to the best
knowledge of" or similarly qualified are correct without such qualification. If
any of our assumptions described above are untrue in any material respect for
any reason or if the Offer and/or the Merger is consummated in a manner that is
different from the manner in which it is described in the Merger Agreement, our
opinion expressed below may be adversely affected and may not be relied upon.
Based upon the foregoing, in reliance thereon and subject thereto, (i)
we are of the opinion that the Offer and the Merger will be treated as a single
transaction qualifying as a "reorganization" within the meaning of Section
368(a) of the Internal Revenue Code of 1986, as amended (the "Code"), and that
each of Parent, Merger Sub and the Company will be a party to such
reorganization within the meaning of Section 368(b) of the Code, and (ii) we
confirm that the discussion in the Prospectus under the heading "THE OFFER --
Federal Income Tax Consequences," to the extent it consists of statements of law
and legal conclusions, and subject to the limitations and qualifications set
forth therein, constitutes our opinion as to the material United States federal
income tax consequences of the Offer and the Merger to Company stockholders.
Our opinion is based on current provisions of the Code, the Treasury
Regulations promulgated thereunder, published pronouncements of the Internal
Revenue Service and case law, any of which may be changed at any time with
retroactive effect. Any change in applicable laws or the facts and circumstances
surrounding the Offer and/or the Merger, or any inaccuracy in the statements,
facts, assumptions, representations or covenants upon which we have relied, may
adversely affect our opinion as set forth herein. We assume no responsibility to
inform you of any such change or inaccuracy that may occur or come to our
attention. Finally, our opinion is limited to the United States federal income
tax matters specifically covered hereby.
Quest Diagnostics Incorporated 3 June 24, 2002
We hereby consent to the use of our name in the Prospectus under the
caption "THE OFFER -- Federal Income Tax Consequences," and to the filing of
this opinion with the Commission as an exhibit to the Registration Statement; in
giving this consent, however we do not hereby admit that we are within the
category of persons whose consent is required under Section 7 of the Securities
Act of 1933, as amended, and the rules and regulations of the Commission
promulgated thereunder.
Very truly yours,
/s/ Shearman & Sterling
