LabCorp 2010 Annual Report Download - page 40

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The Company has substantially concluded all U.S. federal
income tax matters for years through 2006. Substantially all
material state and local, and foreign income tax matters have
been concluded through 2005 and 2001, respectively.
The Company has various state income tax examinations
ongoing throughout the year. Management believes adequate
provisions have been recorded related to all open tax years.
The Company provided for taxes on undistributed earnings
of foreign subsidiaries.
14. Stock Compensation Plans
Stock Incentive Plans
There are currently 23.8 shares authorized for issuance under
the 2008 Stock Incentive Plan and the 2000 Stock Incentive
Plan. Each of these plans was approved by shareholders. At
December 31, 2010, there were 4.0 additional shares available
for grant under the Company’s stock option plans.
Stock Options
The following table summarizes grants of non-qualified
options made by the Company to officers, key employees,
and non-employee directors under all plans. Stock options
are generally granted at an exercise price equal to or greater
than the fair market price per share on the date of grant. Also,
for each grant, options vest ratably over a period of three
years on the anniversaries of the grant date, subject to their
earlier expiration or termination.
Changes in options outstanding under the plans for the
periods indicated were as follows:
Weighted- Weighted-
Average Average
Exercise Remaining Aggregate
Number of Price Contractual Intrinsic
Options per Option Term Value
Outstanding at December 31, 2009 6.3 $ 64.52
Granted 1.8 70.47
Exercised (1.3) 55.12
Cancelled (0.2) 71.51
Outstanding at December 31, 2010 6.6 $ 67.84 7.4 $ 132.3
Vested and expected to vest
at December 31, 2010 6.5 $ 67.84 7.4 $ 130.2
Exercisable at December 31, 2010 3.2 $ 68.09 6.2 $ 62.9
The aggregate intrinsic value in the table above represents
the total pre-tax intrinsic value (the difference between the
Company’s closing stock price on the last trading day of 2010
and the exercise price, multiplied by the number of in-the-
money options) that would have been received by the option
holders had all option holders exercised their options on
December 31, 2010. The amount of intrinsic value will change
based on the fair market value of the Company’s stock.
Cash received by the Company from option exercises, the
actual tax benefit realized for the tax deductions and the aggre-
gate intrinsic value of options exercised from option exercises
under all share-based payment arrangements during the years
ended December 31, 2010, 2009, and 2008 were as follows:
2010 2009 2008
Cash received by the Company $ 73.7 $ 14.3 $ 53.6
Tax benefits realized $ 13.2 $ 2.7 $ 14.3
Aggregate intrinsic value $ 33.4 $ 7.0 $ 35.5
LABORATORY CORPORATION OF AMERICA
Notes to Consolidated Financial Statements