Execution Version] SUBSCRIPTION, MERGER AND EXCHANGE AGREEMENT Dated as of September 29, 2005, Among AMERIPATH HOLDINGS, INC., AMERIPATH GROUP HOLDINGS, INC., AQUA ACQUISITION CORP., THE STOCKHOLDERS OF AMERIPATH HOLDINGS, INC. SET FORTH ON THE...

Exhibit 10.1

[Execution Version]

SUBSCRIPTION, MERGER AND EXCHANGE AGREEMENT

Dated as of September 29, 2005,

Among

AMERIPATH HOLDINGS, INC.,

AMERIPATH GROUP HOLDINGS, INC.,

AQUA ACQUISITION CORP.,

THE STOCKHOLDERS OF AMERIPATH HOLDINGS, INC.

SET FORTH ON THE SIGNATURE PAGES HEREOF,

And

THE STOCKHOLDERS OF SPECIALTY LABORATORIES, INC.

SET FORTH ON THE SIGNATURE PAGES HEREOF

TABLE OF CONTENTS


		Page
ARTICLE I	THE SUBSCRIPTION, MERGER AND EXCHANGE	2

SECTION 1.01	The Subscription, Merger and Exchange	2

SECTION 1.02	Closing	4

SECTION 1.03	Effective Time	4

SECTION 1.04	Effects	4

SECTION 1.05	Certificate of Incorporation and Bylaws	4

SECTION 1.06	Directors and Officers	5

SECTION 1.07	Adjustment to Purchase Price	5

ARTICLE II	EFFECT ON THE CAPITAL STOCK OF THE CONSTITUENT CORPORATIONS; EXCHANGE OF CERTIFICATES	6

SECTION 2.01	Effect of Merger on Capital Stock	6

ARTICLE III	REPRESENTATIONS AND WARRANTIES OF AQUA	6

SECTION 3.01	Organization, Standing and Power	7

SECTION 3.02	Aqua Subsidiaries; Equity Interests	7

SECTION 3.03	Capital Structure	7

SECTION 3.04	Authority; Execution and Delivery, Enforceability	8

SECTION 3.05	No Conflicts; Consents	8

SECTION 3.06	SEC Documents; Undisclosed Liabilities	9

SECTION 3.07	Absence of Certain Changes or Events	10

SECTION 3.08	Taxes	10

SECTION 3.09	Absence of Changes in Benefit Plans	12

SECTION 3.10	ERISA Compliance	12

SECTION 3.11	Litigation	13

SECTION 3.12	Compliance with Applicable Laws	14

SECTION 3.13	Material Contracts	15

SECTION 3.14	Intellectual Property	17

SECTION 3.15	Permits	17

SECTION 3.16	Environmental Matters	17

SECTION 3.17	Real Property	18

SECTION 3.18	Insurance	▇▇

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▇▇▇▇▇▇▇ ▇.▇▇	▇▇▇▇▇ Matters	19

SECTION 3.20	Affiliated Transactions	19

SECTION 3.21	Brokers	20

ARTICLE IV	REPRESENTATIONS AND WARRANTIES WITH RESPECT TO HOLDINGS AND MERGER SUB	20

SECTION 4.01	Organization, Standing and Power	20

SECTION 4.02	Holdings	20

SECTION 4.03	Merger Sub	20

SECTION 4.04	Authority; Execution and Delivery, Enforceability	20

SECTION 4.05	No Conflicts	21

SECTION 4.06	Brokers	21

ARTICLE V	REPRESENTATIONS AND WARRANTIES OF AQUA STOCKHOLDERS	21

SECTION 5.01	Organization; Authority; Execution and Delivery, Enforceability	21

SECTION 5.02	No Conflicts	21

SECTION 5.03	Aqua Common Stock	22

SECTION 5.04	Brokers	22

ARTICLE VI	REPRESENTATIONS AND WARRANTIES OF FOUNDER PARTIES	22

SECTION 6.01	Organization; Authority; Execution and Delivery, Enforceability	22

SECTION 6.02	No Conflicts	22

SECTION 6.03	Silver Common Stock	23

SECTION 6.04	Brokers	23

ARTICLE VII	COVENANTS RELATING TO CONDUCT OF BUSINESS	23

SECTION 7.01	Conduct of Business	23

ARTICLE VIII	ADDITIONAL AGREEMENTS	24

SECTION 8.01	Access to Information; Confidentiality	24

SECTION 8.02	Best Efforts; Notification	25

SECTION 8.03	Fees and Expenses	25

SECTION 8.04	Public Announcements	25

SECTION 8.05	Transfer Taxes	25

ARTICLE IX	CONDITIONS PRECEDENT	26

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SECTION 9.01	Conditions to Each Party’s Obligation To Effect The Transactions	26

SECTION 9.02	Conditions to Obligations of Aqua and Holdings	26

SECTION 9.03	Conditions to Obligations of Founder Parties	26

ARTICLE X	TERMINATION, AMENDMENT AND WAIVER	27

SECTION 10.01	Termination	27

SECTION 10.02	Effect of Termination	28

SECTION 10.03	Amendment; Extension; Waiver	28

ARTICLE XI	GENERAL PROVISIONS	29

SECTION 11.01	Nonsurvival of Representations and Warranties	29

SECTION 11.02	Notices	29

SECTION 11.03	Definitions	30

SECTION 11.04	Interpretation	31

SECTION 11.05	Severability	31

SECTION 11.06	Counterparts	31

SECTION 11.07	Entire Agreement; Third-Party Beneficiaries	31

SECTION 11.08	Governing Law	32

SECTION 11.09	Assignment	32

SECTION 11.10	Enforcement; Jurisdiction; WAIVER OF JURY TRIAL	32

Exhibit A	Amended and Restated Charter	A-1
Exhibit B	Form of Joinder	B-1
Exhibit C	Founder Agreement	C-1
Exhibit D	Holdings Stockholders’ Agreement	D-1
Exhibit E	Registration Rights Agreement	E-1
Exhibit F	Certificate of Incorporation of the Surviving Corporation	F-1

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		SUBSCRIPTION, MERGER AND EXCHANGE AGREEMENT (this
		“Agreement”), dated as of September 29, 2005, among AMERIPATH HOLDINGS, INC., a
		Delaware corporation (“Aqua”), AMERIPATH GROUP HOLDINGS, INC., a Delaware
		corporation and a wholly owned subsidiary of Aqua (“Holdings”), AQUA ACQUISITION
		CORP., a Delaware corporation and a wholly owned subsidiary of Holdings (“Merger Sub”), the
		stockholders of Aqua set forth on Schedule 1.01(a) hereto (collectively, the “Aqua
		Stockholders”), and the stockholders of Specialty Laboratories, Inc., a California corporation
		(“Silver”) set forth on Schedule 1.01(b) hereto (collectively, the “Founder Parties”).

		WHEREAS, Aqua has organized Holdings, and Holdings has organized Merger
		Sub, for the purpose of effecting the transactions contemplated hereby;

		WHEREAS, Holdings shall issue 55,121,279 shares of the common stock, par
		value $0.01 per share, of Holdings (“Holdings Common Stock”) and 55,121,279 shares of Series
		A participating preferred stock, par value $0.001 per share, of Holdings (“Holdings Preferred
		Stock”) to Aqua Stockholders in exchange for an aggregate $45,900,000, and 47,471,279 shares
		of the common stock, par value $ 0.01, of Aqua (“Aqua Common Stock”), subject to adjustment
		in accordance with Sections 1.01(a) and 1.07 hereof and otherwise on the terms and subject to
		the conditions set forth in this Agreement;

		WHEREAS, Holdings shall issue 19,930,208 shares of Holdings Common Stock
		and 19,930,208 shares of Holdings Preferred Stock to Founder Parties in exchange for 9,025,000
		shares of the common stock, no par value, of Silver (“Silver Common Stock”), subject to
		adjustment in accordance with Sections 1.01(b) and 1.07 hereof and otherwise on the terms and
		subject to the conditions set forth in this Agreement;

		WHEREAS, the parties intend, by executing this Agreement, that the foregoing
		exchanges of Aqua Common Stock and Silver Common Stock for Holdings Common Stock and
		Holdings Preferred Stock qualify as a tax-free exchange under Section 351 of the Internal
		Revenue Code of 1986, as amended (the “Code”);

		WHEREAS, the respective Boards of Directors of Merger Sub and Aqua have
		approved and declared advisable, and the Board of Directors of Holdings has approved, the
		merger of Merger Sub with and into Aqua on the terms and subject to the conditions set forth in
		this Agreement, and the stockholders of Merger Sub and Aqua have adopted this Agreement;

		WHEREAS, simultaneously with the execution of this Agreement, Aqua,
		AmeriPath, Inc., a Delaware corporation (“Opco”), Silver and Silver Acquisition Corp., a
		California corporation and a wholly owned subsidiary of Opco (“Silver Merger Sub”), have
		entered into an Agreement and Plan of Merger (the “Silver Merger Agreement”), pursuant to
		which Silver Merger Sub shall be merged with and into Silver (the “Silver Merger”) and as a
		result, Opco will acquire all of the outstanding stock of Silver immediately after the
		consummation of the transactions contemplated by this Agreement;

		WHEREAS, in connection with the transactions contemplated by this Agreement,
		the Certificate of Incorporation of Holdings shall be amended and restated in the form of Exhibit
		A hereto (the “Restated Holdings Charter”); and

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		WHEREAS, the parties hereto desire to make certain representations, warranties,
		covenants and agreements in connection with the Transactions (as defined in Section 1.01) and
		also to prescribe various conditions to the Transactions.

		NOW, THEREFORE, in consideration of the foregoing and the representations,
		warranties, covenants and agreements herein contained, the parties hereto, intending to be legally
		bound, hereby agree as follows:

		ARTICLE I

		The Subscription, Merger and Exchange

		SECTION 1.01 The Subscription, Merger and Exchange. On the terms and
		subject to the conditions set forth in this Agreement, and in accordance with the Delaware
		General Corporation Law (the “DGCL”), the following transactions shall take place at the
		Closing (as defined in Section 1.02) (the transactions contemplated by this Section 1.01 are
		referred to in this Agreement collectively as the “Transactions”):

		(a) Each Aqua Stockholder shall (i) subscribe and pay for and Holdings shall
		issue to such Aqua Stockholder the number of fully paid and nonassessable shares of Holdings
		Common Stock and Holdings Preferred Stock set forth opposite the name of such Aqua
		Stockholder on Schedule 1.01(a) of this Agreement under the headings “Holdings Common
		Shares From Cash” and “Holdings Preferred Shares From Cash,” respectively, at a purchase
		price of $1.20 (the “Holdings Common Stock Price”) per share of Holdings Common Stock in
		cash and $4.80 (the “Holdings Preferred Stock Price”) per share of Holdings Preferred Stock in
		cash (collectively, the “Holdings Subscription”), or (ii) sell and transfer the number of shares of
		Aqua Common Stock set forth opposite such Aqua Stockholder’s name on Schedule 1.01(a) of
		this Agreement under the heading “Contributed Shares” to Holdings, and, in exchange therefor,
		Holdings shall issue to such Aqua Stockholder the number of fully paid and nonassessable shares
		of Holdings Common Stock and Holdings Preferred Stock set forth opposite the name of such
		Aqua Stockholder on Schedule 1.01(a) of this Agreement under the headings “Holdings
		Common Shares From Contribution” and “Holdings Preferred Shares From Contribution,”
		respectively (the “Aqua Stockholder Exchange”). In addition, prior to the Effective Time (as
		defined below), it is contemplated that, with the consent of Aqua, certain additional stockholders
		of Aqua (“Additional Aqua Stockholders”) shall, by execution and delivery of a joinder in the
		form attached as Exhibit B hereto (a “Joinder”), agree to become parties to this Agreement and
		be bound by the terms and conditions hereof as if an Aqua Stockholder hereunder. The
		Additional Aqua Stockholders shall be entitled to contribute shares of Aqua Common Stock to
		Holdings, and in exchange for each such share, Holdings shall issue to such stockholders fully
		paid and nonassessable shares of Holdings Common Stock and fully paid and nonassessable
		shares of Holdings Preferred Stock, in each case, in the same proportion and at the same price as
		the shares of Holdings Common Stock and Holdings Preferred Stock to be issued in the Aqua
		Stockholder Exchange. Upon execution and delivery of a Joinder by any Additional Aqua
		Stockholder, Schedule 1.01(a) shall be amended, without any further action by any of the parties
		hereto, to reflect the contribution to be made by such Additional Aqua Stockholder.

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		(b) Each Founder Party shall sell and transfer the number of shares of Silver
		Common Stock set forth opposite the name of such Founder Party on Schedule 1.01(b) of this
		Agreement under the heading “Contributed Shares” to Holdings, and, in exchange therefor,
		Holdings shall issue to such Founder Party the number of fully paid and nonassessable shares of
		Holdings Common Stock and Holdings Preferred Stock set forth opposite the name of such
		Founder Party on Schedule 1.01(b) of this Agreement under the headings “Holdings Common
		Shares From Contribution” and “Holdings Preferred Shares From Contribution,” respectively
		(collectively, the “Founder Exchange”). Notwithstanding the foregoing, if, at the Effective
		Time, the Founder Parties do not hold an aggregate 20% or more of the outstanding shares of
		Holdings Common Stock and an aggregate 20% or more of the outstanding shares of Holdings
		Preferred Stock, then the shares of Silver Common Stock to be contributed by the Specialty
		Family Limited Partnership pursuant to the Founder Exchange shall be increased such that at the
		Effective Time, the Founder Parties hold an aggregate 20% of the outstanding shares of Holdings
		Common Stock and an aggregate 20% of the outstanding shares of Holdings Preferred Stock. In
		any such event Schedule 1.01(b) shall be amended, without any further action by any of the
		parties hereto, to reflect the additional contribution to be made by the Specialty Family Limited
		Partnership.

		(c) (i) Holdings and ▇▇▇▇▇ ▇. ▇▇▇▇▇, M.D., Ph.D. (“Founder”) shall execute
		and deliver the agreement relating to services to be provided by Founder in the form attached as
		Exhibit C (the “Founder Agreement”), and (ii) Holdings, Aqua Stockholders and Founder Parties
		shall execute and deliver the Holdings Stockholders’ Agreement in the form attached as Exhibit
		D (the “Holdings Stockholders’ Agreement”) and the Registration Rights Agreement in the form
		attached as Exhibit E (the “Registration Rights Agreement”). The Founder Agreement, the
		Holdings Stockholders’ Agreement and the Registration Rights Agreement are, collectively, the
		“Holdings Agreements.”

		(d) Merger Sub shall be merged with and into Aqua at the Effective Time (as
		defined in Section 1.03) (the “Merger”). At the Effective Time, the separate corporate existence
		of Merger Sub shall cease and Aqua shall continue as the surviving corporation (the “Surviving
		Corporation”).

		(e) At the Effective Time, Holdings and Aqua shall take all action necessary
		such that each outstanding option to purchase shares of Aqua Common Stock (an “Aqua
		Option”), whether or not then exercisable, shall be cancelled and shall entitle the holder thereof
		to receive, as soon as reasonably practicable after the surrender thereof, only an amount in cash
		equal to the product of (x) the total number of shares of Aqua Common Stock subject to the
		Aqua Option times (y) the excess, if any, of the value of the Merger Consideration over the
		exercise price per share of Aqua Common stock under such Aqua Option, less applicable Taxes
		required to be withheld with respect to such payment. The Aqua Option Plan (as defined in
		Section 3.03) shall be terminated immediately after the Effective Time, and the provisions in any
		agreement, arrangement or other benefit plan providing for the issuance, transfer or grant of any
		capital stock of Aqua or any interest in respect of any capital stock of Aqua shall be deleted
		immediately after the Effective Time, and Aqua shall take such actions to ensure that following
		the Effective Time no holder of an Aqua Option or any participant in or a party to the Aqua
		Option Plan or any similar plan or other agreement, arrangement or benefit plan shall have any

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		right thereunder to acquire any capital stock or any interest in respect of any capital stock of the
		Surviving Corporation.

		SECTION 1.02 Closing. The closing (the “Closing”) of the Transactions shall
		take place at the offices of Ropes & ▇▇▇▇ LLP, ▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇,
		▇▇▇▇▇ as promptly as practicable after all the conditions set forth in Article IX have been
		satisfied (or, to the extent permitted by Law (as defined in Section 3.05), waived by the parties
		entitled to the benefits thereof), in each case other than those conditions that by their nature are
		to be satisfied at the Closing, but subject to the fulfillment or waiver of those conditions (and in
		any event, not more than two business days following the satisfaction or waiver of all such
		conditions), or at such other place, time and date as shall be agreed in writing between Aqua and
		Founder. The date on which the Closing occurs is referred to in this Agreement as the “Closing
		Date”. Notwithstanding anything to the contrary set forth herein, (i) the Holdings Subscription,
		the Aqua Stockholder Exchange and the Founder Exchange shall be deemed to occur
		simultaneously with each other, in each case, immediately prior to the Effective Time, and (ii)
		the Effective Time shall be deemed to occur immediately prior to the effective time of the Silver
		Merger. All amounts of cash contributed to Holdings by the applicable Aqua Stockholders in
		exchange for shares of Holdings Common Stock and Holdings Preferred Stock hereunder shall
		be delivered to Holdings at the Closing by wire transfer of immediately available funds to an
		account designated by Holdings to such Aqua Stockholders. All certificates (or affidavits of loss
		reasonably acceptable to Holdings), each accompanied by a stock power duly executed by the
		record holders thereof, representing the shares of Aqua Common Stock or Silver Common Stock
		contributed to Holdings in accordance with Section 1.01 shall be delivered to Holdings at the
		Closing. At the Closing, Aqua shall surrender to Holdings the certificate representing all of the
		issued and outstanding shares of Holdings Common Stock prior to the Effective Time and such
		shares shall be cancelled at Closing in consideration for $6.00 per share payable by Holdings.

		SECTION 1.03 Effective Time. Prior to the Closing, Aqua shall prepare, and on
		the Closing Date Aqua shall cause to be filed with the Secretary of State of the State of Delaware
		a certificate of merger or other appropriate documents (in any such case, the “Certificate of
		Merger”) executed in accordance with Section 251 of the DGCL and shall make all other filings
		or recordings required under the DGCL. The Merger shall become effective at such time as the
		Certificate of Merger is duly filed with the Secretary of State of the State of Delaware or at such
		other time as Aqua shall specify in the Certificate of Merger (the time the Merger becomes
		effective being the “Effective Time”).

		SECTION 1.04 Effects. The Merger shall have the effects set forth in the DGCL,
		including Section 259 of the DGCL.

		SECTION 1.05 Certificate of Incorporation and Bylaws.

		(a) Certificate of Incorporation. The Certificate of Incorporation of the
		Surviving Corporation shall be amended at the Effective Time to read in the form of Exhibit F,
		and, as so amended, such Certificate of Incorporation shall be the Certificate of Incorporation of
		the Surviving Corporation until thereafter changed or amended as provided therein or by
		applicable Law.

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		(b) Bylaws. The Bylaws of Aqua as in effect immediately prior to the
		Effective Time shall be the Bylaws of the Surviving Corporation until thereafter changed or
		amended as provided therein or by applicable Law.

		SECTION 1.06 Directors and Officers.

		(a) Directors. The directors of Aqua immediately prior to the Effective Time
		shall be the directors of the Surviving Corporation, until the earlier of their resignation or
		removal or until their respective successors are duly elected and qualified, as the case may be.

		(b) Officers. The officers of Aqua immediately prior to the Effective Time
		shall be the officers of the Surviving Corporation, until the earlier of their resignation or removal
		or until their respective successors are duly elected or appointed and qualified, as the case may
		be.

		SECTION 1.07 Adjustment to Purchase Price. The parties acknowledge and
		agree that the Holdings Subscription, the Aqua Stockholder Exchange and the Founder Exchange
		each assume that (i) the per share value of a share of Aqua Common Stock contributed to
		Holdings prior to the Effective Time is $6.00, (ii) the per share value of a share of Silver
		Common Stock contributed to Holdings prior to the Effective Time is $13.25, (iii) 20% of the
		value of cash and contributed securities in such Transactions will be used to subscribe for, or will
		be exchanged for, Holdings Common Stock (the “Holdings Common Allocation”), (iv) 80% of
		the value of cash and contributed securities in such Transactions will be used to subscribe for, or
		will be exchanged for, Holdings Preferred Stock (the “Holdings Preferred Allocation”), and (v)
		the per share value of the shares of Holdings Common Stock and Holdings Preferred Stock
		issued in such transactions are the Holdings Common Stock Price and the Holdings Preferred
		Stock Price, respectively. Notwithstanding the foregoing, the parties agree that it may be in the
		best interest of Holdings to adjust the Holdings Common Allocation and the Holdings Preferred
		Allocation or sell shares of Holdings Common Stock and Holdings Preferred Stock at a price per
		share other than the Holdings Common Stock Price and the Holdings Preferred Stock Price,
		respectively. Accordingly, the parties agree that Holdings shall be entitled to amend this
		agreement to adjust one or more of the Holdings Common Allocation, the Holdings Preferred
		Allocation, the Holdings Common Stock Price and Holdings Preferred Stock Price, provided that
		pursuant to any such amendment (A) the per share value of a share of Aqua Common Stock
		contributed to Holdings shall remain $6.00, (B) the per share value of a share of Silver Common
		Stock contributed to Holdings shall remain at $13.25, (C) the sum of the amended Holdings
		Common Allocation and amended Holdings Preferred Allocation equals 100%, (D) the sum of
		the amended Holdings Common Stock Price and amended Holdings Preferred Stock equals
		$6.00, and (E) any such amended Holdings Common Allocation, amended Holdings Preferred
		Allocation, amended Holdings Common Stock Price and amended Holdings Preferred Stock
		Price shall apply to each of the Holdings Subscription, the Aqua Stockholder Exchange and the
		Founder Exchange. Upon any such amendment, Schedules 1.01(a) and 1.01(b) shall be
		amended, without any further action by any of the parties hereto, to reflect the foregoing
		amendments to the Holdings Common Allocation, the Holdings Preferred Allocation, the
		Holdings Common Stock Price and the Holdings Preferred Stock Price, if any.

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		ARTICLE II

		Effect on the Capital Stock of the
		Constituent Corporations; Exchange of Certificates

		SECTION 2.01 Effect of Merger on Capital Stock. At the Effective Time, by
		virtue of the Merger and without any action on the part of the holder of any capital stock of Aqua
		or Merger Sub:

		(a) Capital Stock of Merger Sub. Each issued and outstanding share of capital
		stock of Merger Sub shall be converted into and become one fully paid and nonassessable share
		of common stock, par value $0.01 per share, of the Surviving Corporation.

		(b) Cancellation of Certain Owned Shares. Each share of the common stock,
		par value $0.01, of Aqua (“Aqua Common Stock”), that is held in the treasury of Aqua, or
		outstanding and held by Holdings or any direct or indirect wholly owned subsidiary of Aqua,
		shall no longer be outstanding and shall automatically be canceled and retired and shall cease to
		exist, and no Holdings Common Stock or other consideration shall be delivered or deliverable in
		exchange therefor.

		(c) Conversion of Aqua Common Stock. Subject to Section 2.01(b), each
		share of Aqua Common Stock that is issued and outstanding prior to the Effective Time, other
		than Dissenting Shares (as defined in Section 2.01(d)), shall be converted into the right to receive
		$6.00 in cash (collectively, the “Merger Consideration”). As of the Effective Time, all such
		shares of Aqua Common Stock shall no longer be outstanding and shall automatically be
		canceled and retired and shall cease to exist, and each holder of a certificate representing any
		such shares of Aqua Common Stock shall cease to have any rights with respect thereto, except
		the right to receive Merger Consideration upon surrender of such certificate, without interest.

		(d) Dissenting Shares. Notwithstanding anything in this Agreement to the
		contrary, shares of Aqua Common Stock that are issued and outstanding immediately prior to the
		Effective Time and that are held by a holder who was entitled to and has validly demanded
		appraisal rights in accordance with Section 262 of the DGCL (“Dissenting Shares”) shall not be
		converted into the right to receive the Merger Consideration unless and until such holder shall
		have failed to perfect or shall have effectively withdrawn or lost such holder’s appraisal rights
		under the DGCL but instead shall be converted into the right to receive payment from the
		Surviving Corporation with respect to such Dissenting Shares in accordance with the DGCL. If
		any such holder shall have failed to perfect or shall have effectively withdrawn or lost such right,
		each share of such holder shall be treated as a share of Aqua Common Stock that had been
		converted as of the Effective Time into the right to receive the Merger Consideration in
		accordance with Section 2.01(c).

		ARTICLE III

		Representations and Warranties of Aqua

		Aqua represents and warrants to the Founder Parties that, except as set forth in the

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		corresponding section of the letter, dated as of the date of this Agreement, from Aqua to the
		Founder Parties (the “Aqua Disclosure Letter”), or in any other section of Aqua Disclosure
		Letter if the relevance of such disclosure or matter is reasonably apparent (except that no matter
		shall be deemed to be disclosed for purposes of Section 3.05 or Section 3.20 of Aqua Disclosure
		Letter if it is not set forth or cross-referenced in such section of Aqua Disclosure Letter):

		SECTION 3.01 Organization, Standing and Power. Each of Aqua and each of its
		subsidiaries (the “Aqua Subsidiaries”) is a corporation, partnership or limited liability company
		duly organized, validly existing and in good standing under the laws of the jurisdiction in which
		it is organized and has full corporate, partnership or limited liability company power and
		authority to conduct its businesses as presently conducted. Aqua and each Aqua Subsidiary is
		duly qualified to do business as a foreign corporation, partnership or limited liability company
		and is in good standing in each jurisdiction where the nature of its business or the ownership or
		leasing of its properties make such qualification necessary, except where the failure to so qualify
		has not had and could not reasonably be expected to have an Aqua Material Adverse Effect (as
		defined in Section 11.03). Aqua has made available to the Founder Parties true and complete
		copies of the articles of incorporation of Aqua, as amended to the date of this Agreement (as so
		amended, the “Aqua Charter”), the Bylaws of Aqua, as amended to the date of this Agreement
		(as so amended, the “Aqua Bylaws”) and the comparable charter and organizational documents
		of each Aqua Subsidiary.

		SECTION 3.02 Aqua Subsidiaries; Equity Interests. (a) Section 3.02(a) of Aqua
		Disclosure Letter lists each Aqua Subsidiary, its jurisdiction of organization and each holder of
		outstanding capital stock or other ownership interests of such subsidiary. All the outstanding
		shares of capital stock or other ownership interests of each Aqua Subsidiary have been validly
		issued and are fully paid and nonassessable and, except as set forth in Aqua Disclosure Letter,
		are owned by Aqua, by another Aqua Subsidiary or by Aqua and another Aqua Subsidiary, free
		and clear of all pledges, liens, hypothecations, claims, charges, mortgages, encumbrances and
		security interests of any kind or nature whatsoever (collectively, “Liens”). No shares of capital
		stock of any Aqua Subsidiary have been issued in violation of any purchase option, call option,
		right of first refusal, preemptive right, subscription right or any similar right. No shares of
		capital stock of any Aqua Subsidiary are reserved for issuance.

		(b) Except for its interests in the Aqua Subsidiaries, Aqua does not as of the
		date of this Agreement own, directly or indirectly, (i) any capital stock, membership interest,
		partnership interest or other equity interest in any person or securities convertible into or
		exchangeable for any equity interest of any person or (ii) any participating interest in the
		revenues or profits of any person, and neither Aqua nor any Aqua Subsidiary is subject to any
		obligation to make any investment (in the form of loan, capital contribution or otherwise) in any
		person.

		SECTION 3.03 Capital Structure. The authorized capital stock of Aqua consists
		of 100,000,000 shares of Aqua Common Stock. At the close of business on September 28, 2005
		(the “Capitalization Date”), (i) 57,904,067 shares of Aqua Common Stock were issued and
		outstanding, (ii) no shares of Aqua Common Stock were held by Aqua in its treasury and
		(iii) 8,191,202 shares of Aqua Common Stock were subject to outstanding Aqua Options,
		1,108,798 additional shares of Aqua Common Stock were reserved for issuance pursuant to

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		Aqua’s 2003 Stock Option and Restricted Stock Plan (the “Aqua Option Plan”). Since the
		Capitalization Date, no other shares of capital stock or other voting securities of Aqua have been
		issued or reserved for issuance, other than the issuance of Aqua Common Stock upon the
		exercise of Aqua Options outstanding on the Capitalization Date and in accordance with their
		present terms and other than as permitted pursuant to Section 7.01(a). All outstanding shares of
		Aqua Common Stock are, and all such shares that may be issued prior to the Effective Time will
		be when issued, duly authorized, validly issued, fully paid and nonassessable and not subject to
		or issued in violation of any purchase option, call option, right of first refusal, preemptive right,
		subscription right or any similar right under any provision of the DGCL, the Aqua Charter, the
		Aqua Bylaws, any Contract (as defined in Section 3.05) to which Aqua is a party or otherwise.
		There are not any bonds, debentures, notes or other indebtedness of Aqua or any Aqua
		Subsidiary having the right to vote (or convertible into, or exchangeable for, securities having the
		right to vote) on any matters on which holders of Aqua Common Stock or holders of equity
		securities of any Aqua Subsidiary may vote (“Voting Aqua Debt”). Except as set forth above
		there are not any options, warrants, rights, convertible or exchangeable securities, “phantom”
		stock rights, stock appreciation rights, restricted stock awards, dividend equivalent awards,
		stock-based performance units, commitments, Contracts (as defined in Section 3.05),
		arrangements or undertakings of any kind to which Aqua or any Aqua Subsidiary is a party
		(i) obligating Aqua or any Aqua Subsidiary to issue, deliver or sell, or cause to be issued,
		delivered or sold, additional shares of capital stock or other equity interests in, or any security
		convertible into or exercisable or exchangeable for any capital stock of or other equity interest in,
		Aqua or of any Aqua Subsidiary or any Voting Aqua Debt or (ii) obligating Aqua or any Aqua
		Subsidiary to issue, grant, extend or enter into any such option, warrant, call, right, security,
		commitment, Contract, arrangement or undertaking. There are not any outstanding contractual
		obligations of Aqua or any Aqua Subsidiary to repurchase, redeem or otherwise acquire any
		shares of capital stock of Aqua or any Aqua Subsidiary.

		SECTION 3.04 Authority; Execution and Delivery, Enforceability. Aqua has all
		requisite corporate power and authority to execute and deliver this Agreement and to
		consummate the Transactions contemplated by this Agreement. The execution and delivery by
		Aqua of this Agreement and the consummation by Aqua of the Transactions contemplated by
		this Agreement have been duly authorized by all necessary corporate action on the part of Aqua.
		The Aqua Stockholders who hold a majority of the issued and outstanding shares of Aqua
		Common Stock, have duly approved this Agreement. Aqua has duly executed and delivered this
		Agreement, and this Agreement constitutes its legal, valid and binding obligation, enforceable
		against it in accordance with its terms.

		SECTION 3.05 No Conflicts; Consents. (a) The execution and delivery by Aqua
		of this Agreement do not, and the consummation of the Merger and the other Transactions
		contemplated by this Agreement and compliance with the terms hereof will not, conflict with, or
		result in any violation of or default (with or without notice or lapse of time, or both) under, or
		give rise to a right of termination, cancellation, modification or acceleration of any obligation or
		to loss of a material asset (including material intellectual property asset) or benefit under, or
		result in the creation of any Lien upon any of the properties or assets of Aqua or any Aqua
		Subsidiary under, any provision of (i) the Aqua Charter, the Aqua Bylaws or the comparable
		charter or organizational documents of any Aqua Subsidiary, (ii) any contract, lease, license,
		loan, credit agreement, indenture, note, bond, mortgage, deed of trust, agreement, Aqua Permit

-8-


		(as defined in Section 3.15), obligation, concession, franchise or other instrument (collectively,
		“Contracts”) to which Aqua or any Aqua Subsidiary is a party or by which any of their
		respective properties or assets is bound or (iii) subject to the filings and other matters referred to
		in Section 3.05(b), any writ, judgment, order, award, consent decree, waiver, stipulation,
		subpoena, citation, notice, summons, restraining order, injunction, stay, ruling or decree
		(collectively, “Judgments”), or statute, law (including common law), ordinance, rule (including
		any New York Stock Exchange or other stock exchange rule or listing requirement) or regulation
		(collectively, “Laws”) applicable to Aqua or any Aqua Subsidiary or their respective properties
		or assets, other than, in the case of clauses (ii) and (iii) above, any such items that, individually
		or in the aggregate, have not had and could not reasonably be expected to have an Aqua Material
		Adverse Effect.

		(b) No consent, approval, license, permit, order or authorization (“Consent”)
		of, or registration, declaration or filing with, or permit from, any government or any court of
		competent jurisdiction, tribunal, judicial body, arbitrator, stock exchange, administrative or
		regulatory agency, self-regulatory organization, commission or other governmental or quasi-
		governmental authority or instrumentality, in each case, whether local, state or Federal, domestic
		or foreign (a “Governmental Entity”), is required to be obtained or made by or with respect to
		Aqua or any Aqua Subsidiary in connection with the execution, delivery and performance of this
		Agreement or the consummation of the Transactions contemplated by this Agreement, other than
		(i) compliance with and filings under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of
		1976, as amended (the “HSR Act”), (ii) relicensures that may be required following the Effective
		Time pursuant to applicable state or Federal Law, (iii) the filing of the Certificate of Merger
		with the Secretary of State of the State of Delaware and appropriate documents with the relevant
		authorities of the other jurisdictions in which Aqua is qualified to do business, (iv) such filings as
		may be required in connection with the taxes described in Section 8.05, and (v) such other items
		(A) required solely by reason of the participation of the Founder Parties (as opposed to any third
		party) in the Transactions or (B) that, individually or in the aggregate, have not had and could
		not reasonably be expected to have an Aqua Material Adverse Effect.

		SECTION 3.06 SEC Documents; Undisclosed Liabilities. (a) Opco has filed all
		reports, schedules, forms, statements and other documents required to be filed by Opco with the
		SEC since December 31, 2002 pursuant to Sections 13(a) and 15(d) of the Securities Exchange
		Act of 1934, as amended (the “Exchange Act”) (the “Aqua SEC Documents”).

		(b) As of its respective date, each Aqua SEC Document complied in all
		material respects with the requirements of the Exchange Act and the rules and regulations of the
		SEC promulgated thereunder applicable to such Aqua SEC Document, and did not contain any
		untrue statement of a material fact or omit to state a material fact required to be stated therein or
		necessary in order to make the statements therein, in light of the circumstances under which they
		were made, not misleading. Except to the extent that information contained in any Aqua SEC
		Document has been revised or superseded by a later filed Aqua SEC Document, none of the
		Aqua SEC Documents contains any untrue statement of a material fact or omits to state any
		material fact required to be stated therein or necessary in order to make the statements therein, in
		light of the circumstances under which they were made, not misleading. The consolidated
		financial statements of Aqua included in the Aqua SEC Documents comply as to form in all
		material respects with applicable accounting requirements and the published rules and

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		regulations of the SEC with respect thereto, have been prepared in accordance with generally
		accepted accounting principles (“GAAP”) (except, in the case of unaudited statements, as
		permitted by Form 10-Q of the SEC) applied on a consistent basis during the periods involved
		(except as may be indicated in the notes thereto) and fairly present the consolidated financial
		position of Opco and its consolidated subsidiaries as of the dates thereof and the consolidated
		results of their operations and cash flows for the periods shown (subject, in the case of unaudited
		statements, to normal year-end audit adjustments).

		(c) Except as set forth in the financial statements filed with the 2004 10-K or
		incurred in the ordinary course since December 31, 2004, as of the date of this Agreement
		neither Aqua nor any Aqua Subsidiary has any liabilities or obligations of any nature (whether
		accrued, absolute, contingent or otherwise) that, individually or in the aggregate, could
		reasonably be expected to have an Aqua Material Adverse Effect.

		(d) None of the Aqua Subsidiaries (other than Opco) is, or has at any time
		been, subject to the reporting requirements of Sections 13(a) and 15(d) of the Exchange Act.

		SECTION 3.07 Absence of Certain Changes or Events. Since December 31,
		2004, (i) Aqua and each Aqua Subsidiary has conducted its business only in the ordinary course
		and in a manner consistent with past practice (except in connection with the negotiation and
		execution and delivery of this Agreement and the Silver Merger Agreement), (ii) no event has
		occurred and no action has been taken that would have been prohibited by the terms of Section
		7.01(a) if such Section had been in effect as of and at all times since December 31, 2004, and
		(iii) there has not been any change, event, condition, circumstance or state of facts (whether or
		not covered by insurance), individually or in the aggregate, that has had or could reasonably be
		expected to have an Aqua Material Adverse Effect.

		SECTION 3.08 Taxes. (a) Each of Aqua and each Aqua Subsidiary has timely
		filed, or has caused to be timely filed on its behalf, all Tax Returns required to be filed by it with
		the appropriate Governmental Entity, and all such Tax Returns are true, complete and accurate in
		all material respects. All Taxes shown to be due on such Tax Returns, or other Taxes owed,
		have been timely paid. Aqua has afforded the Founder Parties the opportunity to examine true
		and correct copies of all material Tax Returns, examination reports, ruling requests and
		statements of deficiencies, filed, assessed against or agreed to by Aqua or any Aqua Subsidiary.

		(b) Except as could not reasonably be expected to have an Aqua Material
		Adverse Effect, each of Aqua and each Aqua Subsidiary has timely paid any Taxes that are due
		and payable by it. The most recent financial statements contained in the Aqua SEC Documents
		filed with the SEC prior to the date of this Agreement (the “Filed Aqua SEC Documents”) reflect
		an adequate reserve for all Taxes payable (or that may become payable) by Aqua or any Aqua
		Subsidiary (in addition to any reserve for deferred Taxes to reflect timing differences between
		book and Tax items) for all Taxable periods and portions thereof through the date of such
		financial statements. No deficiency with respect to any Taxes has been proposed, asserted or
		assessed against Aqua or any Aqua Subsidiary, and no requests for waivers of the time to assess
		any such Taxes are pending.

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		(c) The Federal income Tax Returns of Aqua and each Aqua Subsidiary
		consolidated in such Tax Returns have been examined by and settled with the United States
		Internal Revenue Service, or have closed by virtue of the expiration of the relevant statute of
		limitations, for all years ending on or before December 31, 2001. All material assessments for
		Taxes due with respect to such completed and settled examinations or any concluded litigation
		have been fully paid.

		(d) There are no material Liens for Taxes (other than for current Taxes not yet
		due and payable) on the assets of Aqua or any Aqua Subsidiary. Neither Aqua nor any Aqua
		Subsidiary is a party to any Contract with respect to Taxes, including (i) a “closing agreement”
		as defined under Code Section 7121 (or any corresponding or similar provision of state, local or
		foreign Law), (ii) a waiver of any statute of limitations in respect of Taxes or the agreement to an
		extension of time with respect to a material assessment of deficiency, (iii) any Tax allocation,
		indemnity or sharing agreement or (iv) a power of attorney with respect to any Tax.

		(e) Each of Aqua and each Aqua Subsidiary has complied in all material
		respects with all applicable Laws relating to the withholding of Taxes and has timely withheld
		and paid to the proper Governmental Entities all amounts required to have been withheld and
		paid in connection with amounts paid or owing to any employee, independent contractor,
		creditor or stockholder.

		(f) There are no audits or other administrative or court proceedings presently
		pending with regard to any Taxes for which Aqua or any Aqua Subsidiary could be liable. No
		dispute or claim concerning any Taxes for which Aqua or any Aqua Subsidiary could be liable
		has been claimed or raised by any Governmental Entity in writing to Aqua, and no claim has
		been made in writing to Aqua by any Governmental Entity in a jurisdiction where Aqua or any
		Aqua Subsidiary does not file Tax Returns that Aqua or any such Aqua Subsidiary is, or may be,
		subject to taxation by that jurisdiction.

		(g) Neither Aqua nor any Aqua Subsidiary (i) has been a member of an
		affiliated group filing a consolidated federal income Tax return (other than such a group of
		which Aqua is the common parent) or (ii) will be required to pay the Taxes of any other person
		under Treasury regulation Section 1.1502-6 (or similar Law), as a transferee or successor, by
		Contract or otherwise.

		(h) Within the past five years, neither Aqua nor any Aqua Subsidiary (i) has
		constituted either a “distributing corporation” or a “controlled corporation” within the meaning
		of Section 355(a)(1)(A) of the Code in a distribution qualifying (or intended to qualify) under
		Section 355 of the Code (or so much of Section 356 as related to Section 355) or (ii) been a party
		to any transaction that was reported as a reorganization within the meaning of Section 368.

		(i) Neither Aqua nor any Aqua Subsidiary is a party to any Contract that,
		individually or collectively, could give rise to the payment of any amount which would not be
		deductible by reason of Section 162(m).

		(j) For purposes of this Agreement:

		“Taxes” includes all forms of taxation, whenever created or imposed, and whether

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		of the United States or elsewhere, and whether imposed by a local, municipal, governmental,
		state, foreign, Federal or other Governmental Entity, or in connection with any agreement with
		respect to Taxes, including all interest, penalties and additions imposed with respect to such
		amounts.

		“Tax Return” means any Federal, state, local, provincial and foreign Tax return,
		declaration, statement, report, schedule, form or other information filed with respect to any Tax,
		including any claim for refunds of any Tax and any attachment to or any amendment or
		supplement of any of the foregoing, filed or required to be filed with any Governmental Entity in
		connection with the determination, assessment or collection of any Tax or the administration of
		any Laws relating to any Tax.

		SECTION 3.09 Absence of Changes in Benefit Plans. Except as disclosed in the
		Filed Aqua SEC Documents, from the date of the most recent financial statements included in
		the Filed Aqua SEC Documents to the date of this Agreement, there has not been any adoption or
		amendment in any material respect by Aqua or any Aqua Subsidiary of any collective bargaining
		agreement or any bonus, pension, profit sharing, deferred compensation, incentive compensation,
		stock ownership, stock purchase, stock option, phantom stock, retirement, vacation, severance,
		change of control, indemnification, disability, death benefit, hospitalization, medical or other
		plan, agreement, arrangement or understanding providing benefits to any current or former
		employee, officer or director of Aqua or any Aqua Subsidiary (collectively, “Aqua Benefit
		Plans”). Except as disclosed in the Filed Aqua SEC Documents, as of the date of this Agreement
		there are not any employment, severance or termination agreements or arrangements between
		Aqua or any Aqua Subsidiary and any current or former executive officer or director of Aqua or
		any Aqua Subsidiary (collectively, the “Aqua Benefit Agreements”).

		SECTION 3.10 ERISA Compliance; Excess Parachute Payments. (a) The Aqua
		Disclosure Letter contains a list of any and all Aqua Benefit Plans, including any and all
		“employee pension benefit plans” (as defined in Section 3(2) of the Employee Retirement
		Income Security Act of 1974, as amended (“ERISA”)) (“Aqua Pension Plans”), “employee
		welfare benefit plans” (as defined in Section 3(1) of ERISA) and all other fringe benefit plans or
		arrangements maintained, or contributed to, by Aqua or any Aqua Subsidiary for the benefit of
		any current or former employees, consultants, officers or directors of Aqua or any Aqua
		Subsidiary (or the dependents of the foregoing or with respect to which Aqua may have any
		material liability). Each Aqua Benefit Plan has been administered in compliance with its terms
		and applicable Law, other than instances of noncompliance that, individually and in the
		aggregate, have not had and could not reasonably be expected to have an Aqua Material Adverse
		Effect. All reports and disclosures relating to each Aqua Benefit Plan required to be filed with or
		furnished to any Governmental Entity or plan participants or beneficiaries have been filed or
		furnished in all material respects in accordance with applicable law in a timely manner. All
		contributions required to be made to each Aqua Benefit Plan pursuant to the terms of such plan
		have been timely made. Aqua has made available to the Founder Parties true, complete and
		correct copies of (i) each Aqua Benefit Plan (or, in the case of any unwritten Aqua Benefit Plan,
		a description thereof), (ii) the most recent annual report on Form 5500 filed with the Internal
		Revenue Service with respect to each Aqua Benefit Plan (if any such report was required), (iii)
		the most recent summary plan description for each Aqua Benefit Plan for which such summary

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		plan description is required and (iv) each true agreement or group annuity contract relating to
		any Aqua Benefit Plan.

		(b) Each Aqua Pension Plan intended to be a “qualified plan” within the
		meaning of Section 401(a) of the Code has been the subject of a determination letter from the
		Internal Revenue Service to the effect that such Aqua Pension Plan is qualified and exempt from
		Federal income taxes under Sections 401(a) and 501(a), respectively, of the Code, and no such
		determination letter has been revoked nor, to the knowledge of Aqua, has revocation been
		threatened, and nothing has occurred since the date of its most recent determination letter in any
		respect that would adversely affect its qualification or materially increase its costs.

		(c) No Aqua Benefit Plan is a “multiemployer plan” within the meaning of
		Section 3(37) of ERISA (a “Multiemployer Pension Plan”), and no Aqua Benefit Plan is subject
		to Title IV or Section 302 of ERISA or Section 412 or 4971 of the Code.

		(d) None of Aqua, any Aqua Subsidiary, any officer of Aqua or any of the
		Aqua Subsidiaries or any of the Aqua Benefit Plans that are subject to ERISA, including Aqua
		Pension Plans, any trusts created thereunder or any trustee or administrator thereof, has engaged
		in a “prohibited transaction” (as such term is defined in Section 406 of ERISA or Section 4975
		of the Code) or any other breach of fiduciary responsibility that could subject Aqua, any Aqua
		Subsidiary or any officer of Aqua or any Aqua Subsidiary to the tax or penalty on prohibited
		transactions imposed by such Section 4975 or to any liability under Section 502(i) or 502(1) of
		ERISA, except as could not reasonably be expected to have an Aqua Material Adverse Effect.

		(e) No Aqua Benefit Plan or trust has been terminated, nor has there been any
		“reportable event” (as that term is defined in Section 4043 of ERISA) with respect to any Aqua
		Benefit Plan during the last five years. Neither Aqua nor any Aqua Subsidiary has incurred a
		“complete withdrawal” or a “partial withdrawal” (as such terms are defined in Sections 4203 and
		4205, respectively, of ERISA) since the effective date of such Sections 4203 and 4205 with
		respect to any Multiemployer Pension Plan.

		(f) With respect to any Aqua Benefit Plan that is an employee welfare benefit
		plan, (i) no such Aqua Benefit Plan is unfunded or funded through a “welfare benefits fund” (as
		such term is defined in Section 419(e) of the Code), and (ii) no such Aqua Benefit Plan provides
		for life, health, medical, disability or other welfare benefits to former employees or beneficiaries
		or dependents thereof, except for health continuation coverage provided at no expense to Aqua
		or any Aqua Subsidiary as required by Section 4980B of the Code or Part 6 of Title I of ERISA.

		(g) There are no material actions, claims, liens or investigations existing or
		pending (other than routine claims for benefits) or, to the knowledge of Aqua, threatened with
		respect to any Aqua Benefit Plan. No Aqua Benefit Plan is under audit or investigation by any
		Governmental Entity and no such completed audit, if any, has resulted in the imposition of any
		Tax during the last 12 months.

		SECTION 3.11 Litigation; Inspections and Investigations. (a) As of the date of
		this Agreement, there is no claim, suit, action, audit or proceeding pending or, to the knowledge
		of Aqua, threatened against Aqua, any Aqua Subsidiary or, to the knowledge of Aqua, any

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		person that Aqua or any Aqua Subsidiary has agreed to indemnify in respect thereof, nor, to the
		knowledge of Aqua, is there any investigation of Aqua (collectively, “Aqua Litigation”) that if
		adversely decided could result (x) in a liability to Aqua and the Aqua Subsidiaries in excess of
		$5,000,000 or (y) in injunctive or other equitable remedy against such parties that would
		materially affect the operation of the business of Aqua, and Aqua is not aware of any basis for
		any such claim, suit, action, audit, proceeding or investigation. As of the date of this Agreement,
		there is no Aqua Litigation that, individually or in the aggregate, has had or could reasonably be
		expected to have an Aqua Material Adverse Effect. As of the date of this Agreement, there is not
		any Judgment outstanding against Aqua or any Aqua Subsidiary or affecting any of their
		respective properties or assets or business operations. There is no Judgment (whether outstanding
		as of the date of this Agreement or first outstanding after the date of this Agreement) the effect of
		which has had or could reasonably be expected to have an Aqua Material Adverse Effect.
		Aqua and any Aqua Subsidiaries have in all material respects performed all of the obligations
		required to be performed to the date of this Agreement by any Judgment against Aqua or any
		Aqua Subsidiary, or by any Contract that settled any suit, action or proceeding against Aqua or
		any Aqua Subsidiary.

		(b) None of Aqua or any Aqua Subsidiaries nor, to Aqua’s knowledge, any of
		their respective officers, directors, employees or agents (or stockholders, representatives or other
		persons acting on the express, implied or apparent authority of such entities) is currently, or has
		been within the last two years, with respect to any state or Federal criminal enforcement agency
		or with respect to Medicare, Medicaid, or any other state or Federal health care payment or
		reimbursement program: (i) the subject of any audit or, to the knowledge of Aqua, any
		investigation; or (ii) party to any Contract or Judgment that (A) requires, or could reasonably be
		expected to require, the payment of a material amount of money by Aqua or any of the Aqua
		Subsidiaries to any state or Federal agency, program, or fiscal intermediary, or (B) requires or
		prohibits any activity by Aqua or any of the Aqua Subsidiaries; and which, in the case of either
		(A) or (B) of this sentence, is either punitive in nature, or serves as a civil penalty.

		SECTION 3.12 Compliance with Applicable Laws; Compliance Program. (a)
		The business of Aqua and the Aqua Subsidiaries is currently being conducted and since January
		1, 2004 has been conducted in compliance with all applicable Laws, including those relating to
		licensure, certification, and operation of clinical laboratories, individuals providing services in or
		to clinical laboratories, reimbursement for products or services provided by Aqua and the Aqua
		Subsidiaries, submission of claims to any payor, including Medicare, Medicaid or other third
		party payors, for items or services, and Environmental Laws (as defined in Section 3.16), except
		for instances of noncompliance that, individually and in the aggregate, have not had and could
		not reasonably be expected to have an Aqua Material Adverse Effect. Neither Aqua nor any
		Aqua Subsidiaries have received any written notice asserting a failure to comply with any Law,
		which failure has had or could reasonably be expected to have an Aqua Material Adverse Effect,
		and which notice has not prior to the date of this Agreement been fully and completely resolved.
		This Section 3.12 does not relate to matters with respect to Taxes, which are the subject of
		Section 3.08.

		(b) Aqua and the Aqua Subsidiaries have timely filed all material filings and
		reports of every kind whatsoever required by Law or by written or oral Contract or otherwise to
		have been filed or made with respect to the provision of services by Aqua and the Aqua

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		Subsidiaries to third-party purchasers, including, but not limited to, Medicare and Medicaid,
		insurance carriers and other fiscal intermediaries. No validation review or program integrity
		review related to Aqua and the Aqua Subsidiaries has been conducted by any commission, board
		or agency in connection with the Medicare or Medicaid program, and no such reviews are
		scheduled, pending or, to Aqua’s knowledge, threatened against or affecting Aqua or the Aqua
		Subsidiaries or the consummation of the transactions contemplated hereby.

		(c) Aqua and the Aqua Subsidiaries maintain an effective voluntary
		compliance program to promote compliance with Law that is consistent with model compliance
		guidance issued by the United States Department of Health and Human Services Office of
		Inspector General (“OIG”) and applicable laws and regulations. To the knowledge of Aqua, no
		individual employed by, contracting independently with or otherwise providing services or
		supplies in connection with the conduct of business by Aqua or any Aqua Subsidiary is excluded
		from participation in the Medicare or Medicaid programs or is listed on the excluded individuals
		list published by the OIG.

		SECTION 3.13 Material Contracts. (a) Section 3.13(a) of the Aqua Disclosure
		Letter sets forth a list of the following Contracts, whether written or oral (and if oral, a complete
		and accurate summary thereof) to which Aqua or any Aqua Subsidiary is a party, in each case to
		the extent in effect on this date of this Agreement (the “Aqua Material Contracts”):

		(i) Aqua Benefit Plans or Aqua Benefit Agreements;

		(ii) Contracts for the provision of laboratory services to the top 25 customers
		of Aqua, measured by revenue for the period January to June 2005;

		(iii) Contracts providing for the licensing of material Intellectual Property
		Rights (as defined in Section 3.14);

		(iv) Contracts which are reasonably likely to involve aggregate payments by or
		to Aqua or any Aqua Subsidiary of more than $2,500,000 annually or $5,000,000 over
		the remaining term of the Contract), other than the sale of services or products in the
		ordinary course of business;

		(v) real property leases or subleases;

		(vi) Contracts that (A) limit the ability of Aqua or any Aqua Subsidiary or
		affiliate of, or successor to, Aqua, or, to the knowledge of Aqua, any executive officer of
		Aqua, to compete in any line of business or with any person or in any geographic area or
		during any period of time, (B) require Aqua or any Aqua Subsidiary or affiliate of, or
		successor to, Aqua to use any supplier or third party for all or substantially all of any of
		its material requirements or need in any respect, (C) limit or purport to limit the ability of
		Aqua or any Aqua Subsidiary or affiliate of, or successor to, Aqua to solicit any
		customers or clients of the other parties thereto, (D) require Aqua or any Aqua Subsidiary
		or affiliate of, or successor to, Aqua to provide to the other parties thereto “most favored
		nations” pricing or (E) require Aqua or any Aqua Subsidiary or affiliate of, or successor
		to, Aqua to market or co-market any products or services of a third party (other than any
		customer of Aqua or any Aqua Subsidiary);

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		(vii) Contracts relating to (A) any indebtedness (which does not include
		accounts payable incurred in the ordinary course of business), notes payable (including
		notes payable in connection with acquisitions), accrued interest payable or other
		obligations for borrowed money, whether current, short-term, or long-term, secured or
		unsecured, of Aqua or any Aqua Subsidiary, (B) any purchase money indebtedness or
		earn-out or similar obligation in respect of purchases of property or assets by Aqua or any
		Aqua Subsidiary, (C) any lease obligations of Aqua or any Aqua Subsidiary under leases
		which are capital leases in accordance with GAAP, (D) any financing of Aqua or any
		Aqua Subsidiary effected through “special purpose entities” or synthetic leases or project
		financing, (E) any obligations of Aqua or any Aqua Subsidiary in respect of banker’s
		acceptances or letters of credit (other than stand-by letters of credit in support of ordinary
		course trade payables), (F) any obligation or liability of Aqua or any Aqua Subsidiary
		with respect to interest rate swaps, collars, caps, currency derivatives and similar hedging
		obligations or (G) any guaranty of any of the foregoing (the liabilities and obligations
		referred to in (A) through (G) above, “Indebtedness”);

		(viii) Contracts entered into by Aqua or any of the Aqua Subsidiaries and any
		other person providing for the acquisition by Aqua or such Aqua Subsidiary (including
		by merger, consolidation, acquisition of stock or assets or any other business
		combination) of any corporation, partnership, other business organization or division or
		unit thereof or any material amount of assets of such other person, and information
		identifying the maximum amounts, if any, that are still payable or potentially payable to
		any other person under such Contracts pursuant to any post-closing adjustment to the
		purchase price (including under any “earnout” or other similar provision);

		(ix) stockholder agreements, registration rights agreements, voting trusts or
		other Contracts to which Aqua is a party or by which it is bound relating to the voting of
		any shares of the capital stock of Aqua,

		(x) joint venture contracts, partnership arrangements or other agreements
		outside the ordinary course of business involving a sharing of profits, losses, costs or
		liabilities of any person by Aqua or any Aqua Subsidiary with any third person;

		(xi) all confidentiality, non-disclosure or standstill agreements entered into by
		Aqua or any of the Aqua Subsidiaries (other than in the ordinary course of business); and

		(xii) other Contracts not covered by the foregoing, that are otherwise material
		to Aqua and the Aqua Subsidiaries, taken as a whole.

		(b) Aqua has made available to Parent or publicly filed as exhibits to the Aqua
		SEC Documents true, complete and correct copies of all written Contracts required to be listed in
		Section 3.13(a) of the Aqua Disclosure Letter, together with all amendments, waivers or other
		changes thereto, and a complete and accurate written summary of each oral Contract required to
		be listed. All Aqua Material Contracts are in full force and effect, constitute legal, valid and
		binding obligations of the respective parties thereto, and are enforceable in accordance with their
		respective terms. Aqua or the Aqua Subsidiary that is a party to any Aqua Material Contract has
		in all material respects performed all of the obligations required to be performed by it to the date

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		of this Agreement, and there exists no default, or any event which upon the giving of notice or
		the passage of time, or both, would give rise to a default, in the performance by Aqua or such
		applicable Aqua Subsidiaries or, to the knowledge of Aqua, any other party to any Aqua Material
		Contract of their respective obligations thereunder. Neither Aqua nor any Aqua Subsidiary has
		received any written notice of the intention of any party to terminate or cancel any Aqua Material
		Contract, whether as a termination or cancellation for convenience or for default of Aqua or any
		Aqua Subsidiary thereunder.

		SECTION 3.14 Intellectual Property. Aqua and the Aqua Subsidiaries own, or
		are validly licensed or otherwise have the right to use, all patents, patent rights, patented
		inventions, proprietary rights, trade secrets, trademarks, trademark rights, trade names, trade
		name rights, service marks, service ▇▇▇▇ rights, copyrights and other proprietary intellectual
		property rights and computer programs (collectively, “Intellectual Property Rights”) which are
		material to the conduct of the business of Aqua and the Aqua Subsidiaries, as conducted on the
		date of this Agreement, taken as a whole. No claims are pending or, to the knowledge of Aqua,
		threatened that Aqua or any of the Aqua Subsidiaries is infringing or has since January 1, 2002
		infringed the rights of any person with regard to any Intellectual Property Right. To the
		knowledge of Aqua, no person is infringing or since January 1, 2002 has infringed the rights of
		Aqua or any of the Aqua Subsidiaries with respect to any Intellectual Property Right. To the
		knowledge of Aqua, there is no prior art that may render any patent held by or licensed to Aqua
		or any Aqua Subsidiary invalid or any patent application held by or licensed to Aqua or any
		Aqua Subsidiary unpatentable which has not been disclosed to the Office to which the patent
		application was made. To the knowledge of Aqua, there has been no inequitable conduct with
		respect to the prosecution of any patent or patent application held by or licensed to Aqua or any
		Aqua Subsidiary.

		SECTION 3.15 Aqua Permits. (a) Each of Aqua and the Aqua Subsidiaries has
		obtained any and all material licenses, franchises, permits, easements, rights, consents, orders,
		approvals, variances, exemptions, accreditations and other authorizations of or issued by any
		Governmental Entity required by Law or otherwise necessary to enable Aqua or the Aqua
		Subsidiaries to (i) conduct the business of Aqua as heretofore conducted and (ii) obtain
		reimbursement related to services provided in connection with the Medicare or Medicaid
		programs, and all contracts, programs and other arrangements with third-party payers, insurers or
		fiscal intermediaries (collectively, the “Aqua Permits”). Aqua Permits are, and after giving
		effect to the consummation of the transactions contemplated hereby, will continue to be, valid
		and in full force and effect and no violations exist in respect thereof, except for violations that,
		individually and in the aggregate, have not had and could not reasonably be expected to have an
		Aqua Material Adverse Effect.

		(b) To the knowledge of Aqua, all individuals employed by, or providing
		services as individual contractors to, Aqua or any Aqua Subsidiary in connection with the
		conduct of business by Aqua or any Aqua Subsidiary have obtained and currently maintain all
		necessary Aqua Permits required to perform such services or provide such supplies to Aqua or
		the Aqua Subsidiaries.

		SECTION 3.16 Environmental Matters. Except as has not had and could not
		reasonably be expected to have an Aqua Material Adverse Effect, (i) to the knowledge of Aqua,

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		no facts, circumstances or conditions exist with respect to any real property now or previously
		owned, leased and/or operated by Aqua or by any Aqua Subsidiary or affiliates (“Aqua Real
		Property”) that have resulted or could reasonably be expected to result in a violation of any
		Environmental Law, (ii) there has been no Release (as defined herein) of any Hazardous
		Substance (as defined herein) on, at, from or, to the knowledge of Aqua, to any Aqua Real
		Property, (iii) to Aqua’s knowledge, there has been no Release of any Hazardous Substance on,
		at, to or from any property adjacent to or in the immediate vicinity of the Aqua Real Property
		which, through soil, subsoil, bedrock, surface or ground water migration, has come or could
		reasonably be expected to come to be located on the Aqua Real Property, (iv) none of the Aqua
		Real Property has been used for the storage, treatment, generation, transportation, processing,
		handling, production or disposal of any Hazardous Substance or as a landfill or other waste
		disposal site, except in each case in this paragraph (iv) in material compliance with applicable
		Law, and (v) there are no underground storage tanks located on or beneath any of the Aqua Real
		Property. As used in this Agreement, (i) the term “Environmental Law” means any Law relating
		to the protection of the environment, health, safety and natural resources, including for the
		prevention of pollution or contamination, or the cleanup, regulation and protection of the air,
		water or soil in the indoor or outdoor environment, (ii) the term “Release” means the spill,
		emission, leaking, pumping, injecting, deposit, disposal, discharge, dispersal, leaching or
		migrating of any Hazardous Substance into the indoor or outdoor environment, in each case
		other than in material compliance with applicable Law, and (iii) the term “Hazardous
		Substances” means any pollutant, contaminant, effluent, emission, radioactive substance, toxic
		substance, hazardous waste, hazardous material, medical waste, radioactive waste, petroleum or
		petroleum derived substance or waste, asbestos (and any substance containing asbestos),
		polychlorinated biphenyls, flammable explosives, methane, chemicals known to cause cancer or
		reproductive toxicity, any material that, because of its quantity, concentration or physical,
		chemical or infectious characteristics, may cause or pose a present or potential threat to human
		health or the environment when improperly used, treated, stored, disposed of, generated,
		manufactured, transported, or otherwise handled, all other substances or related materials defined
		as hazardous or toxic in, or otherwise included within the scope of, any Environmental Law, and
		any hazardous or toxic constituent thereof.

		SECTION 3.17 Real Property. Aqua does not own any real property. Aqua or
		one of the Aqua Subsidiaries has a good and valid leasehold interest in each parcel of real
		property leased by Aqua or any of the Aqua Subsidiaries (the “Aqua Leased Property”). To
		Aqua’s knowledge, (i) Aqua or one of the Aqua Subsidiaries has the right to use and occupy the
		Aqua Leased Property for the full term of the lease or sublease relating thereto, and (ii) neither
		Aqua nor any of the Aqua Subsidiaries has assigned its interest under any such lease or sublease
		or sublet any part of the premises covered thereby or exercised any option or right thereunder
		except as has not had and as could not reasonably be expected to have, individually or in the
		aggregate, an Aqua Material Adverse Effect.

		SECTION 3.18 Insurance. Aqua and the Aqua Subsidiaries, taken as a whole,
		are covered by valid and currently effective insurance policies issued in favor of Aqua and the
		Aqua Subsidiaries that are customary in all material respects for companies of similar size and
		financial condition in Aqua’s industry. All such policies are in full force and effect, all
		premiums due and payable thereon have been paid and Aqua and the Aqua Subsidiaries have
		complied with the provisions of such policies, except where such failure to be in full force and

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		effect, such nonpayment or such noncompliance has not had and could not reasonably be
		expected to have, individually or in the aggregate, an Aqua Material Adverse Effect. Section
		3.18 of the Aqua Disclosure Letter contains a list of the policies issued to Aqua and the Aqua
		Subsidiaries that are in effect on the date of this Agreement. None of Aqua or any of the Aqua
		Subsidiaries has been advised of any defense to coverage or reservation of rights in connection
		with any material claim to coverage asserted or noticed by Aqua or any of the Aqua Subsidiaries
		under or in connection with any of their existing insurance policies. None of Aqua or any of the
		Aqua Subsidiaries has received any written notice from or on behalf of any insurance carrier
		issuing policies or binders relating to or covering Aqua or the Aqua Subsidiaries that Aqua
		reasonably believes will cause a cancellation or non-renewal of existing policies or binders or a
		material decrease in coverage or a material increase in deductible or self insurance retention.

		SECTION 3.19 Labor Matters. None of Aqua or any of the Aqua Subsidiaries is
		a party to, or is bound by, any collective bargaining agreement, contract or other agreement or
		understanding with a labor union or labor organization. None of Aqua or any of the Aqua
		Subsidiaries is the subject of a proceeding asserting that Aqua or any of the Aqua Subsidiaries
		has committed an unfair labor practice (within the meaning of the National Labor Relations Act)
		or seeking to compel Aqua or any of the Aqua Subsidiaries to bargain with any labor
		organization as to wages and conditions of employment. There is (i) no strike or material labor
		dispute, slowdown or stoppage pending or, to the knowledge of Aqua, threatened against Aqua
		or any of the Aqua Subsidiaries and (ii) to the knowledge of Aqua, no union certification petition
		has been filed with respect to the employees of Aqua or the Aqua Subsidiaries. None of Aqua or
		any of the Aqua Subsidiaries has received written notice of the intent of any Governmental
		Entity responsible for the enforcement of labor or employment Laws to conduct an investigation
		with respect to or relating to employees of Aqua or any of the Aqua Subsidiaries and, to the
		knowledge of Aqua, no such investigation is in progress. Aqua and Aqua Subsidiaries have at
		all times complied with the provisions of the Workers Adjustment and Retraining Notification
		Act of 1988.

		SECTION 3.20 Affiliate Contracts and Affiliated Transactions. No officer or
		director of Aqua or any Aqua Subsidiary (or, to Aqua’s knowledge, any family member of any
		such person who is an individual or any entity in which any such person or any such family
		member owns a material beneficial interest) or any person owning 5% or more of Aqua Common
		Stock is a party to any material Contract with or binding upon Aqua or any of the Aqua
		Subsidiaries or any of their respective properties or assets or has any material interest in any
		material property owned by Aqua or any of the Aqua Subsidiaries or has engaged in any material
		transaction with any of the foregoing within the last twelve months.

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		SECTION 3.21 Brokers. No broker, investment banker, financial advisor or
		other person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or
		commission in connection with the Transactions based upon arrangements made by or on behalf
		of Aqua.

		ARTICLE IV

		Representations and Warranties with respect to Holdings and
		Merger Sub

		Aqua, Holdings and Merger Sub, jointly and severally, represent and warrant to
		Founder Parties that:

		SECTION 4.01 Organization, Standing and Power. Each of Holdings and
		Merger Sub is duly organized, validly existing and in good standing under the laws of Delaware
		and has full corporate power and authority to conduct its businesses as presently conducted.

		SECTION 4.02 Holdings. (a) Since the date of its incorporation, Holdings has
		not carried on any business or conducted any operations other than the execution of this
		Agreement, the performance of its obligations hereunder and thereunder and matters ancillary
		thereto.

		(b) On the date of this Agreement, the authorized capital stock of Holdings
		consists of 100 shares of Holdings Common Stock and Holdings is a wholly owned subsidiary of
		Aqua.

		SECTION 4.03 Merger Sub. (a) Since the date of its incorporation, Merger Sub
		has not carried on any business or conducted any operations other than the execution of this
		Agreement, the performance of its obligations hereunder and matters ancillary thereto.

		(b) The authorized capital stock of Merger Sub consists of 100 shares of
		common stock, par value $0.01 per share, all of which have been validly issued, are fully paid
		and nonassessable and are owned by Holdings free and clear of any Lien.

		SECTION 4.04 Authority; Execution and Delivery, Enforceability. (a) Each of
		Holdings and Merger Sub has all requisite corporate power and authority to execute and deliver
		this Agreement and to consummate the Transactions. The execution and delivery by each of
		Holdings and Merger Sub of this Agreement and the consummation by it of the Transactions
		have been duly authorized by all necessary corporate action on the part of Holdings and Merger
		Sub. Holdings, as sole stockholder of Merger Sub, has adopted this Agreement. Each of
		Holdings and Merger Sub has duly executed and delivered this Agreement, and this Agreement
		constitutes its legal, valid and binding obligation, enforceable against it in accordance with its
		terms.

		(b) Holdings has all requisite corporate power and authority to execute and
		deliver the Holdings Agreements and to consummate the transactions contemplated by the
		Holdings Agreements. The execution and delivery by Holdings of the Holdings Agreements and
		the consummation by it of the transactions contemplated thereby have been duly authorized by

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		all necessary corporate action on the part of Holdings. The Holdings Agreements, when
		executed and delivered by Holdings and the other parties thereto, will constitute Holdings’s
		legal, valid and binding obligation, enforceable against it in accordance with its terms.

		SECTION 4.05 No Conflicts. The execution and delivery by Holdings and
		Merger Sub of this Agreement do not, and the execution and delivery by Holdings of the
		Holdings Agreements will not, and the consummation of the Transactions and the transactions
		contemplated by the Holdings Agreements and compliance with the terms hereof and thereof
		will not, conflict with, or result in any violation of or default (with or without notice or lapse of
		time, or both) under, or give rise to a right of termination, cancellation or acceleration of any
		obligation or to loss of a material benefit under, or result in the creation of any Lien upon any of
		the properties or assets of Holdings or Merger Sub under, any provision of (i) the charter or
		organizational documents of Holdings or Merger Sub, (ii) any Contract to which Holdings or
		Merger Sub is a party or (iii) any Judgment or Law applicable to Holdings or Merger Sub.

		SECTION 4.06 Brokers. No broker, investment banker, financial advisor or
		other person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or
		commission in connection with the Transactions based upon arrangements made by or on behalf
		of Holdings or Merger Sub.

		ARTICLE V

		Representations and Warranties of Aqua Stockholders

		Each Aqua Stockholder represents and warrants to Founder Parties, as to itself
		only, that:

		SECTION 5.01 Organization; Authority; Execution and Delivery, Enforceability.
		Such Aqua Stockholder, if it is not an individual, is duly organized, validly existing and in good
		standing under the laws of the jurisdiction in which it is organized. Such Aqua Stockholder (a) if
		it is not an individual, has all requisite power and authority and (b) if he or she is an individual,
		has the legal capacity, in each case to execute and deliver this Agreement and the Holdings
		Agreements to which he, she, or it is a party and to consummate the Transactions and the
		transactions contemplated by the Holdings Agreements to which he, she, or it is a party. The
		execution and delivery by such Aqua Stockholder, if it is not an individual, of this Agreement
		and the Holdings Agreements to which it is a party and the consummation by it of the
		Transactions and the transactions contemplated by the Holdings Agreements to which it is a
		party have been duly authorized by all necessary action on the part of such Aqua Stockholder.
		Such Aqua Stockholder has duly executed and delivered this Agreement, and this Agreement
		constitutes, and the Holdings Agreements to which he, she, or it is a party, when executed by all
		the parties thereto, will constitute, his, her or its legal, valid and binding obligation, enforceable
		against him, her or it in accordance with its terms.

		SECTION 5.02 No Conflicts. The execution and delivery by such Aqua
		Stockholder of this Agreement do not, and the execution and delivery by such Aqua Stockholder
		of the Holdings Agreements to which he, she, or it is a party will not, and the consummation of
		the Transactions and the transactions contemplated by the Holdings Agreements to which he,

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		she, or it is a party and compliance with the terms hereof and thereof will not, conflict with, or
		result in any violation of or default (with or without notice or lapse of time, or both) under, or
		give rise to a right of termination, cancellation or acceleration of any obligation or to loss of a
		material benefit under, or result in the creation of any Lien upon any of the properties or assets of
		such Aqua Stockholder under, any provision of (i) the charter or organizational documents of
		such Aqua Stockholder, if it is not an individual, (ii) any Contract to which such Aqua
		Stockholder is a party or (iii) any Judgment or Law applicable to such Aqua Stockholder.

		SECTION 5.03 Aqua Common Stock. Such Aqua Stockholder is the record and
		beneficial owner of, and has good title to, the shares of Aqua Common Stock to be contributed to
		Holdings pursuant to the Aqua Stockholder Exchange, free and clear of any Liens.

		SECTION 5.04 Brokers. No broker, investment banker, financial advisor or
		other person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or
		commission in connection with the Transactions based upon arrangements made by or on behalf
		of such Aqua Stockholder.

		ARTICLE VI

		Representations and Warranties of Founder Parties

		Each Founder Party represents and warrants to Aqua, Holdings, Merger Sub and
		the Aqua Stockholders as to itself only, that:

		SECTION 6.01 Organization; Authority; Execution and Delivery, Enforceability.
		Such Founder Party, if it is not an individual, is duly organized, validly existing and in good
		standing under the laws of the jurisdiction in which it is organized. Such Founder Party (a) if it
		is not an individual, has all requisite power and authority, and (b) if he or she is an individual,
		has the legal capacity, in each case to execute and deliver this Agreement and the Holdings
		Agreements to which he, she or it is a party and to consummate the Transactions and the
		transactions contemplated by the Holdings Agreements to which he, she or it is a party. The
		execution and delivery by such Founder Party, if it is not an individual, of this Agreement and
		the Holdings Agreements to which he, she or it is a party and the consummation by such Founder
		Party of the Transactions and the transactions contemplated by the Holdings Agreements to
		which he, she or it is a party have been duly authorized by all necessary action on the part of
		such Founder Party. Such Founder Party has duly executed and delivered this Agreement, and
		this Agreement constitutes, and the Holdings Agreements to which he, she or it is a party, when
		executed by all the parties thereto, will constitute, such Founder Party’s legal, valid and binding
		obligation, enforceable against him, her or it in accordance with its terms.

		SECTION 6.02 No Conflicts. The execution and delivery by such Founder Party
		of this Agreement do not, and the execution and delivery by such Founder Party of the Holdings
		Agreements to which he, she or it is a party will not, and the consummation of the Transactions
		and the transactions contemplated by the Holdings Agreements to which he, she or it is a party,
		and compliance with the terms hereof and thereof will not, conflict with, or result in any
		violation of or default (with or without notice or lapse of time, or both) under, or give rise to a
		right of termination, cancellation or acceleration of any obligation or to loss of a material benefit

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		under, or result in the creation of any Lien upon any of the properties or assets of such Founder
		Party under, any provision of (i) the charter or organizational documents of such Founder
		Stockholder, if it is not an individual, (ii) any Contract to which such Founder Party is a party or
		(iii) any Judgment or Law applicable to such Founder Party.

		SECTION 6.03 Silver Common Stock. Such Founder Party is the record and
		beneficial owner of, and has good title to, the shares of Silver Common Stock to be contributed
		to Holdings pursuant to the Founder Exchange, free and clear of any Liens.

		SECTION 6.04 Brokers. No broker, investment banker, financial advisor or
		other person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or
		commission in connection with the Transactions based upon arrangements made by or on behalf
		of such Founder Party.

		ARTICLE VII

		Covenants Relating to Conduct of Business

		SECTION 7.01 Conduct of Business. (a) Conduct of Business. Except for
		matters set forth in the Aqua Disclosure Letter or otherwise contemplated by this Agreement,
		from the date of this Agreement to the Effective Time, Aqua shall, and shall cause each Aqua
		Subsidiary to, (i) conduct its business in the usual, regular and ordinary course in substantially
		the same manner as previously conducted, (ii) use all reasonable efforts to preserve intact its
		current business organization, (iii) use all reasonable efforts to keep available the services of its
		current officers and employees and keep its relationships with customers, suppliers, licensors,
		licensees, distributors and others having business dealings with them, and (iv) comply, in all
		material respects, with all applicable Laws. Except for matters set forth in the Aqua Disclosure
		Letter or otherwise contemplated by this Agreement, from the date of this Agreement to the
		Effective Time, Aqua shall not, and shall not permit any Aqua Subsidiary to, do any of the
		following without the prior written consent of Founder Parties:

		(A) (1) declare, set aside or pay any dividends on, or make any other distributions
		in respect of, any of its capital stock, other than dividends and distributions by a direct or
		indirect wholly owned subsidiary of Aqua to its parent, (2) split, combine or reclassify
		any of its capital stock or issue or authorize the issuance of any other securities in respect
		of, in lieu of or in substitution for shares of its capital stock, other than any of the
		foregoing by a direct or indirect wholly owned subsidiary of Aqua, or (3) purchase,
		redeem or otherwise acquire any shares of capital stock of Aqua or any other securities
		thereof or any rights, warrants or options to acquire any such shares or other securities;

		(B) issue, deliver, sell or grant (1) any shares of its capital stock, (2) any Voting
		Aqua Debt or other voting securities, (3) any securities convertible into or exchangeable
		for, or any options, warrants or rights to acquire, any such shares, Voting Aqua Debt,
		voting securities or convertible or exchangeable securities or (4) any “phantom” stock,
		“phantom” stock rights, stock appreciation rights or stock-based performance units, other
		than in the case of clauses (1), (2), (3) and (4) (x) any such issuance, delivery, sale or
		grant pursuant to an equity plan approved by the Board of Directors of Aqua, (y)

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		issuances upon the exercise of any options for Aqua Common Stock and (z) issuances to
		Aqua or a wholly owned subsidiary of Aqua;

		(C) amend or propose to amend the certificate of incorporation, bylaws or other
		comparable organizational documents of Aqua, Holdings or Opco (other than the filing of
		the Restated Holdings Charter contemplated by this Agreement);

		(D) sell, lease (as lessor), license or otherwise dispose of any properties or assets
		that are material, individually or in the aggregate, to Aqua and the Aqua Subsidiaries,
		taken as a whole, except in the ordinary course of business consistent with past practice;

		(E) authorize, recommend, propose or announce an intention to adopt a plan of
		complete or partial liquidation or dissolution;

		(F) knowingly or intentionally take any action that results or is reasonably likely
		to result in any of the representations or warranties of Aqua hereunder being untrue in
		any material respect; or

		(G) authorize any of, or commit or agree to take any of, the foregoing actions.

		(b) Except for matters set forth in the Aqua Disclosure Letter or otherwise
		contemplated by this Agreement, from the date of this Agreement to the Effective Time, Aqua
		shall not, without the prior written consent of Founder Parties, (i) take, or omit to take, any
		action that could reasonably be expected to result in a breach of the fiduciary duties of Aqua or
		its board of directors to the Founder Parties under the DGCL, or (ii) take any action which
		Holdings would be prohibited from taking without the consent of, or notice to, the Founder
		Parties under the terms of the Holdings Stockholders Agreement or applicable Law without
		obtaining such consent or providing such notice (assuming, in each case, for such purposes that
		on the date of this Agreement each of the Aqua Stockholders and each of the Founder Parties
		hold shares of Aqua capital stock equivalent to the shares of Holdings Common Stock and
		Holdings Preferred Stock to be received by such parties upon consummation of the
		Transactions).

		(c) Advice of Changes. Aqua shall promptly advise Founder Parties orally
		and in writing of any change or event that has or could reasonably be expected to have an Aqua
		Material Adverse Effect.

		ARTICLE VIII

		Additional Agreements

		SECTION 8.01 Access to Information; Confidentiality. Aqua shall, and shall
		cause each of the Aqua Subsidiaries to, afford to Founder Parties and to the Founder Parties’
		officers, employees, accountants, counsel, financial advisors and other representatives,
		reasonable access during normal business hours during the period prior to the Effective Time to
		all Aqua properties, books, contracts, commitments, personnel and records and, during such
		period, Aqua shall, and shall cause each of its subsidiaries to, furnish promptly to Founder
		Parties (a) a copy of each report, schedule, registration statement and other document filed by

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		Aqua during such period pursuant to the requirements of Federal or state securities laws and
		(b) all other information concerning Aqua business, properties and personnel as Founder Parties
		may reasonably request; provided, however, that Aqua may withhold (i) any document or
		information that is subject to the terms of a confidentiality agreement with a third party or
		(ii) such portions of documents or information relating to pricing or other matters that are highly
		competitively sensitive. If any material is withheld by Aqua pursuant to the proviso to the
		preceding sentence, Aqua shall inform Founder Parties as to the general nature of what is being
		withheld.

		SECTION 8.02 Best Efforts; Notification. Upon the terms and subject to the
		conditions set forth in this Agreement, each of the parties shall use its best efforts to take, or
		cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the
		other parties in doing, all things necessary, proper or advisable to consummate and make
		effective, in the most expeditious manner practicable, the Transactions, including (i) the
		obtaining of all necessary Consents of Governmental Entities and the making of all necessary
		registrations, declarations and filings (including filings with Governmental Entities, if any) and
		the taking of all reasonable steps as may be necessary to obtain an approval or waiver from, or to
		avoid an action or proceeding by, any Governmental Entity, (ii) the obtaining of all necessary
		consents, approvals or waivers from third parties, (iii) the defending of any lawsuits or other
		legal proceedings, whether judicial or administrative, challenging this Agreement or the
		consummation of the Transactions, including seeking to have any stay or temporary restraining
		order entered by any court or other Governmental Entity vacated or reversed and (iv) the
		execution and delivery of any additional instruments necessary to consummate the Transactions
		and to fully carry out the purposes of this Agreement. Notwithstanding the foregoing, this
		Section 8.02 shall not require any party to provide any financing for any of the Transactions that
		has not otherwise been agreed to be provided by such party pursuant to the other provisions of
		this Agreement.

		SECTION 8.03 Fees and Expenses. All fees and expenses incurred in connection
		with the Transactions shall be paid by the party incurring such fees or expenses, whether or not
		the Transactions are consummated.

		SECTION 8.04 Public Announcements. The parties will consult with each other
		and will mutually agree upon any press release or other public announcement pertaining to the
		Transactions and shall not issue any such press release or make any such public statement prior
		to such consultation and agreement, except as may be required by applicable Law, in which case
		the party proposing to issue such press release or make such public announcement shall use its
		reasonable best efforts to consult in good faith with the other party before issuing any such press
		release or making any such public announcement.

		SECTION 8.05 Transfer Taxes. All stock transfer, real estate transfer,
		documentary, stamp, recording and other similar Taxes (including interest, penalties and
		additions to any such Taxes) (“Transfer Taxes”) incurred in connection with the Transactions
		shall be paid by Holdings, Merger Sub or the Surviving Corporation.

-25-


		ARTICLE IX

		Conditions Precedent

		SECTION 9.01 Conditions to Each Party’s Obligation To Effect The
		Transactions. The respective obligation of each party to effect the Transactions is subject to the
		satisfaction or waiver on or prior to the Closing Date of the following conditions:

		(a) Antitrust. The waiting period (and any extension thereof) applicable to the
		Transactions under the HSR Act shall have been terminated or shall have expired and any
		Consents of, filings with and notices to, all Governmental Entities required of the parties hereto
		or any of their respective subsidiaries or other affiliates in connection with the Transactions,
		shall have been obtained, effected or made.

		(b) No Injunctions or Restraints. No Judgment or Law preventing the
		consummation of the Transactions shall be in effect; provided, however, that prior to asserting
		this condition, each of the parties shall have used its reasonable best efforts to have such legal
		prohibition removed.

		(c) Silver Merger. All conditions to the closing of the Silver Merger (other
		than the consummation of the Holdings Subscription, the Aqua Stockholder Exchange, the
		Founder Exchange or the Merger), shall have been satisfied or waived in accordance with the
		terms of the Silver Merger Agreement.

		SECTION 9.02 Conditions to Obligations of Aqua, Holdings, Merger Sub and
		the Aqua Stockholders. The obligations of Aqua, Holdings, Merger Sub and the Aqua
		Stockholders to effect the Transactions are further subject to the following conditions:

		(a) Representations and Warranties. The representations and warranties of
		Founder Parties in this Agreement shall be true and correct as of the Closing Date as though
		made on the Closing Date, other than for such failures to be true and correct that, individually
		and in the aggregate, have not had and could not have a material adverse effect on the ability of
		Founder Parties to consummate the Transactions. Aqua and Holdings shall have received a
		certificate signed on behalf of Founder Parties by Founder to such effect.

		(b) Performance of Obligations of Founder Parties. Founder Parties shall
		have performed in all material respects all obligations required to be performed by them under
		this Agreement at or prior to the Closing Date, and Aqua and Holdings shall have received a
		certificate signed on behalf of Founder Parties by Founder to such effect.

		SECTION 9.03 Conditions to Obligations of Founder Parties. The obligations of
		Founder Parties to effect the Transactions are further subject to the following conditions:

		(a) Representations and Warranties. The representations and warranties of
		Aqua (i) set forth Sections 3.01, 3.03, 3.04, 3.05(a) and 3.21 in this Agreement (collectively, the
		“Specified Sections”) shall be true and correct in all material respects as of the Closing Date,
		except to the extent such representations and warranties expressly relate to an earlier date (in
		which case such representations and warranties shall be true and correct as of such earlier date)

-26-


		and (ii) set forth in this Agreement (other than the Specified Sections), disregarding
		qualifications as to “materiality”, “Aqua Material Adverse Effect” or words of similar import,
		shall be true and correct as of the Closing Date as though made on the Closing Date, except to
		the extent such representations and warranties expressly relate to an earlier date (in which case
		such representations and warranties, disregarding qualifications as to “materiality”, “Aqua
		Material Adverse Effect” or words of similar import, shall be true and correct as of such earlier
		date), other than, in the case of clause (ii) only, for such failures to be true and correct that,
		individually and in the aggregate, have not had an Aqua Material Adverse Effect. The
		representations and warranties of Holdings, Merger Sub and Aqua Stockholders in this
		Agreement, disregarding qualifications as to “materiality”, “Aqua Material Adverse Effect” or
		words of similar import, shall be true and correct as of the Closing Date as though made on the
		Closing Date, except to the extent such representations and warranties expressly relate to an
		earlier date (in which case such representations and warranties, disregarding qualifications as to
		“materiality”, “Aqua Material Adverse Effect” or words of similar import, shall be true and
		correct on and as of such earlier date), other than for such failures to be true and correct that,
		individually and the aggregate, have not had and could not reasonably be expected to have an
		Aqua Material Adverse Effect. Founder shall have received a certificate signed on behalf of
		Aqua by the chief executive officer of Aqua to such effect with respect to the representations and
		warranties of Aqua, Holdings and Merger Sub.

		(b) Performance of Obligations of Aqua and Holdings. Aqua and Holdings
		shall have performed in all material respects all obligations required to be performed by them
		under this Agreement at or prior to the Closing Date (other than pursuant to Section 7.01(b)), and
		Founder shall have received a certificate signed on behalf of Aqua by the chief executive officer
		of Aqua to such effect.

		(c) Restated Holdings Charter. The Restated Holdings Charter shall have
		been filed with the Secretary of State of the State of Delaware, and such charter shall have been
		certified by such official as the Amended and Restated Certificate of Incorporation of Holdings.

		(d) Absence of Aqua Material Adverse Effect. There shall not have occurred
		after the date of this Agreement any event, change, condition, circumstance or state of facts, or
		aggregation of events, changes, conditions, circumstances or state of facts, that has had or could
		reasonably be expected to have, individually or in the aggregate, an Aqua Material Adverse
		Effect.

		ARTICLE X

		Termination, Amendment and Waiver

		SECTION 10.01 Termination. (a) This Agreement shall terminate
		automatically, without any action on the part of any party hereto, upon the termination of the
		Silver Merger Agreement in accordance with its terms.

		(b) This Agreement may be terminated by either Aqua or Founder Parties:

-27-


		(i) if any Governmental Entity issues an order, decree or ruling or takes any
		other action permanently enjoining, restraining or otherwise prohibiting the Transactions
		and such order, decree, ruling or other action shall have become final and nonappealable;
		or

		(ii) if any condition to the obligation of such party to consummate the
		Transactions set forth in Section 9.02 (in the case of Aqua and Holdings) or 9.03 (in the
		case of Founder Parties) becomes incapable of satisfaction prior to the Outside Date (as
		such term is defined in the Silver Merger Agreement); provided, however, the failure of
		such condition is not the result of a material breach of this Agreement by the party
		seeking to terminate this Agreement.

		SECTION 10.02 Effect of Termination. In the event of termination of this
		Agreement as provided in Section 10.01, this Agreement shall forthwith become void and have
		no effect, without any liability or obligation on the part of any party hereto or their respective
		affiliates, officers, directors or stockholders, other than Section 3.15, Section 4.06, Section 5.04,
		Section 6.04, Section 8.03, this Section 10.02 and Article XI, which provisions shall survive such
		termination, and except to the extent that such termination results from the willful and material
		breach by a party of any provision set forth in this Agreement.

		SECTION 10.03 Amendment; Extension; Waiver. (a) Other than in accordance
		with Sections 1.01(a), 1.01(b) and 1.07, this Agreement may not be amended except by an
		instrument in writing signed on behalf of each of the parties.

		(c) At any time, the parties may to the extent legally allowed (i) extend the
		time for the performance of any of the obligations or other acts of the other parties, (ii) waive
		any inaccuracies in the representations and warranties contained in this Agreement or in any
		document delivered pursuant to this Agreement or (ii) waive compliance with any of the
		agreements or conditions contained in this Agreement. Any agreement on the part of a party to
		any such extension or waiver shall be valid only if set forth in an instrument in writing signed on
		behalf of such party. The failure of any party to this Agreement to assert any of its rights under
		this Agreement or otherwise shall not constitute a waiver of such rights. The rights and remedies
		provided herein shall be cumulative and not exclusive of any rights or remedies provided by
		Law.

		(d) The prior written consent of Silver shall be required for any amendment,
		extension or waiver of any provision of this Agreement that, in any case, (i) increases the
		economic value of the aggregate consideration to be received by the Founder Parties for each
		share of Silver Common Stock to be contributed to Holdings by the Founder Parties in the
		Founder Exchange, or (ii) changes or otherwise has the effect of changing any other provision of
		this Agreement, which change could reasonably be expected to prevent or materially delay the
		consummation of the Transactions.

-28-


		ARTICLE XI

		General Provisions

		SECTION 11.01 Nonsurvival of Representations, Warranties, Covenants and
		Agreements. None of the representations, warranties, covenants and agreements contained in
		this Agreement or in any instrument delivered pursuant to this Agreement shall survive the
		Effective Time, except the representations and warranties of Holdings, the Aqua Stockholders
		and the Founder Parties set forth in Articles IV, V and VI and the covenant set forth in Section
		7.01(b) shall, in each case, survive the Effective Time. This Section 11.01 shall not limit any
		covenant or agreement of the parties which by its terms contemplates performance after the
		Effective Time (which covenant or agreement shall survive in accordance with its terms).

		SECTION 11.02 Notices. All notices, requests, claims, demands and other
		communications under this Agreement shall be in writing and shall be delivered personally,
		delivered by nationally recognized overnight courier service, sent by certified or registered mail,
		postage prepaid, or sent by facsimile (subject to electronic confirmation of such facsimile
		transmission and the sending (on the date of such facsimile transmission) of a confirmation copy
		of such facsimile by nationally recognized overnight courier service or by certified or registered
		mail, postage prepaid). Any such notice or communication shall be deemed to have been given
		(i) when delivered, if personally delivered, (ii) one business day after it is deposited with a
		nationally recognized overnight courier service, if sent by nationally recognized overnight
		courier service, (iii) the day of sending, if sent by facsimile prior to 5:00 p.m. (EST) on any
		business day or the next succeeding business day if sent by facsimile after 5:00 p.m. (EST) on
		any business day or on any day other than a business day or (iv) five business days after the date
		of mailing, if mailed by certified or registered mail, postage prepaid, in each case, to the
		following address or facsimile number, or to such other address or addresses or facsimile number
		or numbers as such party may subsequently designate to the other parties by notice given
		hereunder:

		(a) if to Aqua, Holdings, Merger Sub or Aqua Stockholders, to:

		c/o AmeriPath, Inc.
		▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
		▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
		Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
		Attention: ▇▇▇▇▇ ▇. ▇▇▇▇, Esq.

		with a copies to:

		Welsh, Carson, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ IX, L.P.
		▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
		▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
		Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
		Attention: D. ▇▇▇▇▇ ▇▇▇▇▇▇▇

		and

-29-


		Ropes & ▇▇▇▇ LLP
		▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
		▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
		Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
		Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.

		(b) if to Founder Parties, to the addresses set forth on Schedule 1.01(b), with
		copies to:

		▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ LLP
		▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇
		▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
		Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
		Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.

		and

		O’Melveny & ▇▇▇▇▇ LLP
		Times Square Tower
		▇ ▇▇▇▇▇ ▇▇▇▇▇▇
		▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
		Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
		Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
		▇▇▇▇▇▇▇ ▇. Puff, Esq.

		SECTION 11.03 Definitions. For purposes of this Agreement:

		An “affiliate” of any person means another person that directly or indirectly,
		through one or more intermediaries, controls, is controlled by, or is under common control with,
		such first person.

		An “Aqua Material Adverse Effect means any change, effect, event, occurrence or
		circumstance that has a material adverse effect on (i) the business, financial condition or results
		of operations of Aqua and the Aqua Subsidiaries, taken as a whole, or (ii) the ability of Aqua to
		perform its obligations under this Agreement or to consummate the Merger and the other
		transactions contemplated by this Agreement, in the case of each of (i) and (ii) other than effects
		relating to (A) changes, effects, events, occurrences or circumstances that generally affect the
		United States economy or the industries in which Aqua operates (other than changes in Law that
		do not exist and have not been proposed prior to the date of this Agreement) and, in each case,
		that do not have a materially disproportionate impact on Aqua and the Aqua Subsidiaries, taken
		as a whole, (B) changes in Law (but only to the extent such changes exist or have been proposed
		prior to the date of this Agreement) or reimbursement policies or practices of customers, (C) the
		announcement of this Agreement or the Transactions, or (D) those matters described in Section
		11.03 of the Aqua Disclosure Letter.

		A “person” means any individual, firm, corporation, partnership, company,
		limited liability company, trust, joint venture, association, Governmental Entity or other entity.

-30-


		A “subsidiary” of any person means another person, an amount of the voting
		securities, other voting ownership or voting partnership interests of which is sufficient to elect at
		least a majority of its Board of Directors or other governing body (or, if there are no such voting
		interests, 50% or more of the equity interests of which) is owned directly or indirectly by such
		first person.

		SECTION 11.04 Interpretation. When a reference is made in this Agreement to a
		Section, such reference shall be to a Section of this Agreement unless otherwise indicated. The
		table of contents and headings contained in this Agreement are for reference purposes only and
		shall not affect in any way the meaning or interpretation of this Agreement. Each party hereto
		has participated in the drafting of this Agreement, which each party acknowledges and agrees is
		the result of extensive negotiations among the parties. Whenever the words “include”,
		“includes” or “including” are used in this Agreement, they shall be deemed to be followed by the
		words “without limitation”. Unless otherwise provided herein, each accounting term used in this
		Agreement has the meaning given to it in accordance with GAAP. When used herein, the phrase
		“to the knowledge of” any person or any similar phrase means the actual knowledge of the
		officers and directors of such person and such person’s subsidiaries and other individuals who
		have similar powers and duties as the officers of such persons, and the knowledge of facts that
		such individuals should have after reasonable due inquiry. The definitions contained in this
		Agreement are applicable to the singular as well as the plural forms of such terms and to the
		masculine as well as to the feminine and neuter genders of such terms. Any agreement or statute
		referred to herein means such agreement or statute as from time to time amended, qualified or
		supplemented, including, in the case of statutes, by succession of comparable successor statutes.
		References to the Exchange Act are also references to the rules and regulations of the SEC
		promulgated thereunder. References to a person are also to its successors and permitted assigns.

		SECTION 11.05 Severability. If any term or other provision of this Agreement
		is invalid, illegal or incapable of being enforced by any Law or public policy, all other terms,
		conditions and provisions of this Agreement shall nevertheless remain in full force and effect so
		long as the economic or legal substance of the Transactions is not affected in any manner
		materially adverse to any party. Upon such determination that any term or other provision is
		invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to
		modify this Agreement so as to effect the original intent of the parties as closely as possible.

		SECTION 11.06 Counterparts. This Agreement may be executed in one or more
		counterparts (and delivered by facsimile), all of which shall be considered one and the same
		original agreement and shall become effective when one or more counterparts have been signed
		by each of the parties and delivered to the other parties.

		SECTION 11.07 Entire Agreement; Third-Party Beneficiaries. This Agreement,
		taken together with the Silver Merger Agreement, the Confidentiality Agreement (as defined in
		the Silver Merger Agreement) and the Aqua Disclosure Letter and the other schedules to this
		Agreement, (a) constitute the entire agreement, and supersede all prior agreements and
		understandings, both written and oral, among the parties with respect to the Transactions and (b)
		except for the provisions of Section 10.03(c), are not intended to confer upon any person other
		than the parties any rights or remedies. Silver shall be an intended third party beneficiary with

-31-


		respect to Section 10.03(c), and shall be entitled to the rights and benefits of, with full power to
		enforce, the provisions thereof.

		SECTION 11.08 Governing Law. This Agreement shall be governed by, and
		construed in accordance with, the laws of the State of New York applicable to agreements made
		and to be performed entirely within such state.

		SECTION 11.09 Assignment. Neither this Agreement nor any of the rights,
		interests or obligations under this Agreement shall be assigned, in whole or in part, by operation
		of law or otherwise by any of the parties without the prior written consent of the other parties;
		provided, that any Aqua Stockholder shall have the right to assign all or any portion of its rights
		to subscribe and pay for shares of Holdings Common Stock and Holdings Preferred Stock, and
		receive such shares from Holdings, in each case, pursuant to Section 1.01(a)(i), to any other
		person approved by Holdings (it being understood that any such assignment shall not relieve
		such assigning Aqua Stockholder of its obligations under Section 1.01(a)(i) if and to the extent
		such assignee elects not to undertake such subscription or make such payment at the time the
		Holdings Subscription is consummated). Any purported assignment other than in accordance
		with this Section 11.09 shall be void. Subject to the preceding sentences, this Agreement will be
		binding upon, inure to the benefit of, and be enforceable by, the parties and their respective
		successors and assigns.

		SECTION 11.10 Enforcement; Jurisdiction; WAIVER OF JURY TRIAL. The
		parties acknowledge and agree that irreparable damage (for which money damages would not be
		an adequate remedy) would occur in the event that any of the provisions of this Agreement were
		not performed in accordance with their specific terms or were otherwise breached. It is
		accordingly agreed that, in addition to any other remedies, the parties shall be entitled to an
		injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the
		terms and provisions of this Agreement in any New York state court or any Federal court, in
		each case, located in New York County, this being in addition to any other remedy to which they
		are entitled at law or in equity. In addition, each of the parties hereto (a) consents to submit itself
		to the personal jurisdiction of any New York state court or any Federal court located in New
		York County in the event any dispute arises out of this Agreement or any Transaction, (b) agrees
		that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for
		leave from any such court, (c) irrevocably and unconditionally waives, to the fullest extent it
		may legally and effectively do so, the defense of an inconvenient forum to the maintenance of
		any action arising out of this Agreement or any Transaction in any such court, (d) agrees that it
		will not bring any action relating to this Agreement or any Transaction in any court other than
		any New York state court or any Federal court, in each case, sitting in the New York County and
		(e) WAIVES ANY RIGHT TO TRIAL BY JURY WITH RESPECT TO ANY ACTION
		RELATED TO OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION.

-32-


IN WITNESS WHEREOF, Aqua, Holdings, Merger Sub, Aqua Stockholders, and
Founder Parties have duly executed this Agreement, all as of the date first written above.

	AMERIPATH HOLDINGS, INC.

	By:	/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
	Name:	▇▇▇▇▇▇ ▇. ▇▇▇▇▇
	Title:	Chief Executive Officer

	AMERIPATH GROUP HOLDINGS, INC.

	By:	/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
	Name:	▇▇▇▇▇▇ ▇. ▇▇▇▇▇
	Title:	Chief Executive Officer

	AQUA ACQUISITION CORP.

	By:	/S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
	Name:	▇▇▇▇▇▇ ▇. ▇▇▇▇▇
	Title:	President

-33-




		Aqua Stockholders:

		WELSH, CARSON, ▇▇▇▇▇▇▇▇
				& ▇▇▇▇▇ IX, L.P.

		By:		WCAS IX Associates, LLC,
				its General Partner

		By:		/s/ D. ▇▇▇▇▇ ▇▇▇▇▇▇▇
		Name:		D. ▇▇▇▇▇ ▇▇▇▇▇▇▇
		Title:		Manager

		WCAS CAPITAL PARTNERS III, L.P.

		By:		WCAS CP III Associates, LLC,
				its General Partner

		By:		/s/ D. ▇▇▇▇▇ ▇▇▇▇▇▇▇
		Name:		D. ▇▇▇▇▇ ▇▇▇▇▇▇▇
		Title:		Manager

-34-




		Founder Parties:

		SPECIALTY FAMILY LIMITED PARTNERSHIP

		By:		/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
				▇▇▇▇▇ B. ▇▇▇▇▇, M.D.,
				as Managing General Partner

		By:		The ▇▇▇▇▇ Family Revocable Trust,
				as a General Partner

		By:		/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
				▇▇▇▇▇ B. ▇▇▇▇▇, M.D.,
				as Trustee

		and

		By:		/s/ ▇▇▇▇ ▇. ▇▇▇▇▇
				▇▇▇▇ ▇. ▇▇▇▇▇,
				as Trustee

		By:		/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
				▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
				as a General Partner

		▇▇▇▇▇ ▇. ▇▇▇▇▇, JR. THIRD GENERATION TRUST

		By:		/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
				▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
				as a Trustee

		▇▇▇▇ ▇. ▇▇▇▇▇▇▇ THIRD GENERATION TRUST

		By:		/s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
				▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇,
				as a Trustee

-35-


▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ THIRD GENERATION TRUST

By:		/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
		▇▇▇▇▇▇ L. ▇▇▇▇▇,
		as a Trustee

and

By:		/s/ ▇▇▇▇▇ ▇. ▇▇▇▇
		▇▇▇▇▇ ▇. ▇▇▇▇,
		as a Trustee

▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇ THIRD GENERATION TRUST

By:		/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
		▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
		as a Trustee

▇▇▇▇▇ ▇. ▇▇▇▇ THIRD GENERATION TRUST

By:		/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
		▇▇▇▇▇▇ L. ▇▇▇▇▇,
		as a Trustee

and

By:		/s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
		▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇,
		as a Trustee

▇▇▇▇▇▇ ▇. ▇▇▇▇▇ THIRD GENERATION TRUST

By:		/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇, JR.
		▇▇▇▇▇ ▇. ▇▇▇▇▇, Jr.,
		as a Trustee

-36-


		▇▇▇▇▇▇ ▇. ▇▇▇▇▇ AND ▇▇▇ ▇. ▇▇▇▇▇▇▇, AS JOINT TENANTS

		By:		/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
				▇▇▇▇▇▇ L. ▇▇▇▇▇,
				as a Co-Tenant

		and

		By:		/s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
				▇▇▇ ▇. ▇▇▇▇▇▇▇,
				as a Co-Tenant

				/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇, JR.
				▇▇▇▇▇ ▇. ▇▇▇▇▇, Jr.,
				in his individual capacity

-37-

Execution Version] SUBSCRIPTION, MERGER AND EXCHANGE AGREEMENT Dated as of September 29, 2005, Among AMERIPATH HOLDINGS, INC., AMERIPATH GROUP HOLDINGS, INC., AQUA ACQUISITION CORP., THE STOCKHOLDERS OF AMERIPATH HOLDINGS, INC. SET FORTH ON THE...

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