EXHIBIT 99.1
RESTRICTED STOCK AGREEMENT
THIS AGREEMENT dated as of March 1, 2005 (the "Date of Grant") between
Laboratory Corporation of America Holdings, a Delaware corporation (the
"Company") and <First_Name> <MI> <Last_Name> (the "Employee").
W I T N E S S E T H
In consideration of mutual promises and covenants made herein and the mutual
benefits to be derived herefrom, the parties hereto agree as follows:
1. Definitions. Unless otherwise defined herein, bolded terms used herein
shall have the meaning set forth in the Laboratory Corporation of
America Holdings 2000 Stock Incentive Plan (the "Plan").
2. Grant of Restricted Shares.
(a) Subject to the provisions of this Agreement and to the provisions
of the Plan, the Company hereby grants to the Employee that number
of shares of common stock, par value $0.10 per share ("Common
Stock") of the Company, set forth on Annex A attached hereto,
subject to the restrictions set forth herein (the "Restricted
Shares"). Subject to Section 3, certificates evidencing the
Restricted Shares shall be issued by the Company and registered
in the name of the Employee on the stock transfer books of the
Company. However, certificates issued with respect to Restricted
Shares shall be held by the Company in escrow under the terms
hereof. Such certificates shall bear the legend set forth in
subsection (c) below or such other appropriate legend as the
Committee shall determine, which legend shall be removed only if
and when the Restricted Shares vest as provided herein, at which
time the certificates shall be delivered to the Employee. As a
condition to the issuance of Shares hereunder, the Employee shall
deliver to the Company the attached stock power duly endorsed in
blank. Upon the issuance of Restricted Shares hereunder, the
Employee shall be entitled to vote the Restricted Shares, and shall
be entitled to receive, free of all restrictions, ordinary cash
dividends paid on the Restricted Shares. The Employee's right to
receive any extraordinary dividends or other distributions, and any
dividends or distributions in any form other than cash, with respect
to Restricted Shares prior to their becoming non-forfeitable shall
be at the sole discretion of the Committee, but in the event of any
such extraordinary event, dividend, or distribution, the Committee
shall take such action as is appropriate to preserve the value of,
and prevent the unintended enhancement of the value of, the
Restricted Shares.
(b) In order to comply with any applicable securities laws, the Company
may require the Employee (i) to furnish evidence satisfactory to the
Company (including a written and signed representation letter) to
the effect that the Restricted Shares were acquired for investment
only and not for resale or distribution and (ii) to agree that the
Restricted Shares shall only be sold by the Employee following
registration under the Securities Act of 1933, as amended, or
pursuant to an exemption therefrom.
(c) Unless otherwise determined by the Committee, any certificate issued
in respect of the Restricted Shares prior to the lapse of any
outstanding restrictions relating thereto shall bear the following
legend:
This certificate and the shares of stock represented hereby are
subject to the terms and conditions, including the forfeiture
provisions and restrictions against transfer (the "Restrictions"),
contained in the Laboratory Corporation of America Holdings
2000 Stock Incentive Plan and an agreement entered into between the
registered owner and the Company. Any attempt to dispose of these
shares in contravention of the applicable restrictions, including by
way of sale, assignment, transfer, pledge, hypothecation or
otherwise, shall be null and void and without effect.
3. Vesting.
(a) Subject to Sections 4 and 5 hereof, the restrictions on transfer of
the Restricted Shares shall lapse and the Restricted Shares shall
become vested and non-forfeitable on the third anniversary of the
Date of Grant.
(b) Notwithstanding subsection (a), the Restricted Shares shall become
vested and non-forfeitable as follows: One-third (1/3) of the shares
will vest on March 1, 2006, an additional one-third (1/3) of such
shares will vest on March 1, 2007, and the remaining one-third (1/3)
shares will vest on March 1, 2008, in each case subject to the prior
expiration or sooner termination of the Restricted Shares.
Notwithstanding the foregoing calculations, any fractional shares will be
disregarded.
4. Termination of Employment.
Except as provided in Section 5 hereof, Restricted Shares shall not vest unless
the Employee is then in the employ of (i) the Company or an Affiliate
Corporation, and unless the Employee has remained continuously so employed
since the date of grant of the Restricted Shares. In the event that the
employment of the Employee shall terminate (other than by reason of death,
Disability or Retirement), all unvested Restricted Shares shall be forfeited.
5. Acceleration of Benefits upon Death, Disability or Retirement of Employee
or Change in Control.
If (i) the Employee shall die while employed by the Company or an Affiliate
Corporation thereof, (ii) the Employee's employment shall terminate by reason
of Disability or Retirement, or (iii) there is a Change in Control, all
Restricted Shares granted to the Employee pursuant to this Agreement which
are unvested shall become immediately vested and non-forfeitable.
6. Non-transferability of Restricted Shares.
The Restricted Shares are non-transferable and may not be sold, assigned,
transferred, disposed of, pledged or otherwise encumbered by the Employee,
other than by will or the laws of descent and distribution until such
Restricted Shares become non-forfeitable in accordance with the provisions of
this Agreement. Any Employee's successor (a "Successor") shall take rights
herein granted subject to the terms and conditions hereof. No such transfer
of the Restricted Shares to any Successor shall be effective to bind the
Company unless the Company shall have been furnished with written notice
thereof and a copy of such evidence as the Committee may deem necessary to
establish the validity of the transfer and the acceptance by such Successor
of the terms and conditions hereof.
7. No Right to Continued Employment.
Nothing in this Agreement or the Plan shall confer upon the Employee any right
to continue in the employ of the Company or any of its affiliate corporations
or interfere in any way with the right of the Company or any such affiliate
corporation to terminate such employment at any time.
8. Taxes and Withholding.
The Employee shall pay to the Company promptly upon request, and in any event
at the time the Employee recognizes taxable income in respect of the
Restricted Shares, an amount equal to the taxes the Company determines it is
required to withhold under applicable tax laws with respect to the Restricted
Shares. Such payment shall be made in the form of cash, shares of Common
Stock already owned or otherwise issuable upon the lapse of restrictions, or
in a combination of such methods, as irrevocably elected by the Employee prior
to the applicable tax due date with respect to such Restricted Shares. The
Employee shall promptly notify the Company of any election made pursuant of
Section 83(b) of the Code.
9. Effect of Certain Changes.
(a) If there is any change in the number of outstanding shares of
Common Stock by reason of any stock dividend, stock split,
recapitalization, combination, exchange of shares, merger,
consolidation, liquidation, split-up, spin-off or other similar
change in capitalization, any distribution to shareholders,
including a rights offering, other than cash in dividends, or any
like change, the number of Restricted Shares covered by this
Agreement shall be proportionately adjusted by the Committee to
reflect any such change or distribution provided, however, that
any fractional shares resulting from such adjustment shall be
eliminated.
(b) In the event of a change in the Common Stock as presently
constituted, which is limited to a change of all of its authorized
shares with par value into the same number of shares with different
par value or without par value, the shares resulting from any such
change shall be deemed to be Common Stock within the meaning of this
Agreement and the Plan.
(c) To the extent that the foregoing adjustments relate to stock or
securities of the Company, such adjustments shall be made by the
Committee, whose determination in that respect shall be final,
binding and conclusive.
10. Other Restrictions.
The vesting of each Restricted Share shall be subject to the requirement that,
if at any time the Committee shall determine that (i) the listing,
registration or qualification of the shares of Common Stock subject or related
thereto upon any securities exchange or under any state or federal law, or
(ii) the consent or approval of any government regulatory body, or (iii) an
agreement by the Employee with respect to the disposition of shares of Common
Stock is necessary or desirable as a condition of, or in connection with, such
vesting or the delivery or purchase of shares pursuant thereto, then in any
such event, such vesting shall not be effective unless such listing,
registration, qualification, consent, approval or agreement shall have been
effected or obtained free of any conditions not acceptable to the Committee.
11. Notices.
Any notices to be given under the terms of this Agreement shall be in writing
and addressed to the Company at 430 South Spring Street, Burlington, North
Carolina 27215, Attention: Corporate Secretary and to the Employee at the
address set forth on Annex A, or at such other address as either party may
hereafter designate in writing to the other.
12. Effect of Agreement.
Except as otherwise provided hereunder, this Agreement shall be binding upon
and shall inure to the benefit of any successor or successors of the Company.
13. Laws Applicable to Construction.
This Agreement has been granted, executed and delivered in the State of New
York, and the interpretation, performance and enforcement of this Agreement
shall be governed by the laws of the State of New York, as applied to
contracts executed in and performed wholly within the State of New York.
14. Conflicts and Interpretation.
If there is any conflict between this Agreement and the Plan, or if there is
any ambiguity in this Agreement, any term which is not defined in this
Agreement, or any matter as to which this Agreement is silent, in any such
case the Plan shall govern including, without limitation, the provisions
thereof pursuant to which the Committee has the power, among others, to (i)
interpret the Plan, (ii) prescribe, amend and rescind rules and regulations
relating to the Plan and (iii) make all other determinations deemed necessary
or advisable for the administration of the Plan.
15. Headings.
The headings of Sections herein are included solely for convenience or
reference and shall not affect the meaning or interpretation of any of the
provisions of this Agreement.
16. Amendment.
This Agreement may not be modified, amended or waived in any manner except by
an instrument in writing signed by both parties hereto. The waiver by either
party of compliance with any provision of this Agreement shall not operate or
be construed as a waiver of any other provision of this Agreement, or of any
subsequent breach by such party of a provision of this Agreement.
17. Gross Up for Excise Tax.
In the event that the Employee becomes entitled by reason of a Change in
Control to the accelerated vesting of the Restricted Shares, if the Employee
will be subject to the excise tax (the "Excise Tax") under Section 4999 of the
Code, the Company shall pay to the Employee as additional compensation an
amount (the "Gross-Up Payment") as calculated under the Plan, and subject to
adjustment under procedures described in the Plan.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
on its behalf by a duly authorized officer and the Employee has hereunto set
his/her hand, effective as of the day and year first above written.
LABORATORY CORPORATION OF AMERICA HOLDINGS
By: ______________________________________
Thomas P. Mac Mahon, Chairman and CEO
EMPLOYEE
By: ______________________________________
<First_Name> <MI> <Last_Name>
Annex A to Restricted Stock Agreement
Employee Name and Address:
<First_Name> <MI> <Last_Name>
<Address>
<City>, <State> <Zip>
Employee Social Security Number:
<SSN>
Number and Type of Award:
<Restricted_Shares> restricted shares
Vesting:
1/3 on March 1, 2006
1/3 on March 1, 2007
1/3 on March 1, 2008
STOCK POWER FORM