Version: 2.70 official (win 64)
**How to reproduce:**
Inspect the "Worm" mesh and apply the laplacian deform modifier as a shape key. Notice that applying the modifier leaves behind the messed up basis mesh. The shape key created is relative to that messed up basis.
{F81969}
**Expected Behavior:**
Technically, this IS the expected behavior! But it's not useful. Applying the Laplacian Deform Modifier as a shape key should restore the mesh to the original shape to which the modifier was bound (in this case, a perfectly straight rectangular prism), and the new shape key should be relative to that original shape. This makes it possible for a modeler/rigger/animator to create shape keys with laplacian deform while preserving the original shape of the mesh.