Quest Diagnostics 2006 Annual Report Download - page 68

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(a) On July 3, 2006, we completed the acquisition of Focus Technologies Holding Company, or Focus
Diagnostics. Consolidated operating results for 2006 include the results of operations of Focus Diagnostics
subsequent to the closing of the acquisition. See Note 3 to the Consolidated Financial Statements.
(b) During the year ended December 31, 2006, we recorded $55 million of stock-based compensation expense in
accordance with SFAS 123R.
(c) During the year ended December 31, 2006, we recorded $10 million related to net investment losses.
(d) During the year ended December 31, 2006, we recorded $23 million in charges as a result of finalizing our
plan of integration of LabOne and $4.1 million in charges related to consolidating operations in California
into a new facility.
(e) During the year ended December 31, 2006, we recorded $32 million in charges as a result of discontinuing
NID’s operations.
(f) On November 1, 2005, we completed the acquisition of LabOne, Inc., or LabOne.Consolidated operating
results for 2005 include the results of operations of LabOne subsequent to the closing of the acquisition. See
Note 3 to the Consolidated Financial Statements.
(g) On February 28, 2003, we completed the acquisition of Unilab Corporation, or Unilab. Consolidated
operating results for 2003 include the results of operations of Unilab subsequent to the closing of the
acquisition.
(h) On April 1, 2002, we completed the acquisition of American Medical Laboratories, Incorporated, or AML.
Consolidated operating results for 2002 include the results of operations of AML subsequent to the closing
of the acquisition.
(i) During the third quarter of 2005, we recorded a $6.2 million charge primarily related to forgiveness of
amounts owed by patients and physicians, and related property damage as a result of hurricanes in the Gulf
Coast.
(j) During the fourth quarter of 2005, we recorded a $16 million charge to write-off certain assets in connection
with a product hold at NID.
(k) During the second quarter of 2004, we recorded a $10.3 million charge associated with the acceleration of
certain pension obligations in connection with the succession of our prior CEO.
(l) During the third quarter of 2005, we recorded a $7.1 million charge associated with the write-down of an
investment.
(m) During the second quarter of 2004, we recorded a $2.9 million charge to interest expense, net representing
the write-off of deferred financing costs associated with the refinancing of our bank debt and credit facility.
(n) Previously reported basic and diluted earnings per share have been restated to give retroactive effect of our
two-for-one stock split effected on June 20, 2005.
(o) Potentially dilutive common shares primarily include the dilutive effect of our 1
3
⁄
4
% contingent convertible
debentures issued November 26, 2001, which were redeemed principally through a conversion into common
shares as of January 18, 2005, and outstanding stock options, performance share units and restricted common
shares granted under our Amended and Restated Employee Long-Term Incentive Plan and our Amended and
Restated Director Long-Term Incentive Plan.
47