Quest Diagnostics 2003 Annual Report Download - page 94

QUEST DIAGNOSTICS INCORPORATED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED
(dollars in thousands unless otherwise indicated)
Letter of Credit Lines
In December 2003, the Company entered into two lines of credit with two financial institutions totaling
$68 million for the issuance of letters of credit (the “letter of credit lines’’). The letter of credit lines mature in
December 2004 and are guaranteed by the Subsidiary Guarantors. As of December 31, 2003, there $44 million
of outstanding letters of credit under the letter of credit lines.
As of December 31, 2003, long-term debt, including capital leases, maturing in each of the years
subsequent to December 31, 2004, is as follows:
Year ending December 31,
2005........................................................................ $ 73,035
2006........................................................................ 351,790
2007........................................................................ 81,951
2008........................................................................ -
2009 and thereafter .......................................................... 521,931
Total long-term debt ....................................................... $1,028,707
The table above assumes that the Debentures are repaid at their stated maturity in 2021.
12. PREFERRED STOCK AND COMMON STOCKHOLDERS’ EQUITY
Series Preferred Stock
Quest Diagnostics is authorized to issue up to 10 million shares of Series Preferred Stock, par value $1.00
per share. The Company’s Board of Directors has the authority to issue such shares without stockholder
approval and to determine the designations, preferences, rights and restrictions of such shares. Of the authorized
shares, 1,300,000 shares have been designated Series A Preferred Stock and 1,000 shares have been designated
Voting Cumulative Preferred Stock. No shares have been issued, other than the Voting Cumulative Preferred
Stock.
Voting Cumulative Preferred Stock
During the fourth quarter of 2001, the Company redeemed all of the then issued and outstanding shares of
preferred stock for $1 million plus accrued dividends. The Voting Cumulative Preferred Stock is generally
entitled to one vote per share, voting together as one class with the Company’s common stock. Whenever
dividends on the Voting Cumulative Preferred Stock are in arrears, no dividends or redemptions or purchases of
shares may be made with respect to any stock ranking junior as to dividends or liquidation to the Voting
Cumulative Preferred Stock until all such amounts have been paid. The Voting Cumulative Preferred Stock is
not convertible into shares of any other class or series of stock of the Company. The Voting Cumulative
Preferred Stock ranks senior to the Quest Diagnostics common stock and the Series A Preferred Stock.
Preferred Share Purchase Rights
Each share of Quest Diagnostics common stock trades with a preferred share purchase right, which entitles
stockholders to purchase one-hundredth of a share of Series A Preferred Stock upon the occurrence of certain
events. In conjunction with the SBCL acquisition, the Board of Directors of the Company approved an
amendment to the preferred share purchase rights. The amended rights entitle stockholders to purchase shares of
Series A Preferred Stock at a predefined price in the event a person or group (other than SmithKline Beecham)
acquires 20% or more of the Company’s outstanding common stock. The preferred share purchase rights expire
December 31, 2006.
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