A.

Concurrently herewith, the Executive is entering into one or more agreements (herein referred to as “Incentive Compensation Agreements”) with the Company pursuant to which the Executive, subject to continued employment through the dates therein described and certain other restrictions, is receiving the option to purchase and/or otherwise receive shares of common stock issued by the Company as well as certain other benefits and the Executive is now being or may hereafter be offered the opportunity, at the Company’s discretion, to participate in one or incentive compensation or similar plans pursuant to which the Executive will be eligible to earn additional compensation beyond the Executive’s base salary (hereinafter referred to as “Incentive Compensation Plans”).

B.

The Executive and the Company are executing this document to express their agreement concerning certain covenants pertaining to the protection of the Company’s confidential information and trade secrets and its business whereby the Executive agrees to satisfy certain obligations to perform and refrain from performing certain acts during the Executive’s employment with the Company and following the termination of the Executive’s employment with the Company.

C.

The Executive and the Company acknowledge and agree that the rights granted to the Executive under the Incentive Compensation Plans and Incentive Compensation Agreements, as well as the Executive’s continued at-will employment with the Company and access to the Company’s confidential information and trade secrets, Executive’s continued receipt of salary and other remuneration and benefits associated with that at-will employment, and other good and valuable consideration, constitute adequate and sufficient consideration for the Executive’s entering into this Agreement.

(a)       The Executive acknowledges that, in the performance of the Executive’s duties on behalf of the Company, the Executive has had and will have access to, has received and will receive, and has been entrusted and will be entrusted with confidential information and trade secrets including but not limited to systems technology, field operations, reimbursement, development, marketing, organizational, financial, management, administrative, clinical, customer, distribution and sales information, data, specifications and processes owned by the Company or any of its affiliates (collectively, the “Company Group”), or used presently or at any time in the future in the course of the business of the Company Group that is not otherwise part of the public domain (collectively, the “Confidential Material”). All such Confidential Material is considered secret and was and will be made available to the Executive in confidence.

(b)       The Executive hereby agrees that the Executive shall not at any time (whether during or after the Executive’s employment with the Company), directly or indirectly, other than in the course of the Executive’s duties for the Company, disclose or make available to any person, firm, corporation, association or other entity for any reason or purpose whatsoever, any Confidential Material; provided, however, that this Section 1(b) shall not apply (i) when disclosure is required by law or by any court, arbitrator, mediator or administrative or legislative body (including any committee thereof) with apparent jurisdiction to order the Executive to disclose or make available such information (provided, however, that the Executive shall promptly notify the Company in writing upon receiving a request for such information), or (ii) with respect to any other litigation, arbitration or mediation involving this Agreement, including but not limited to enforcement of this Agreement. The Executive agrees that, upon termination of the Executive’s employment with the Company, all Confidential Material in the Executive’s possession that is in written, digital or other tangible form (together with all copies or duplicates thereof, including computer files) shall be returned to the Company and shall not be retained by the Executive or furnished to any third party, in any form except as provided herein; provided, however, that the Executive shall not be obligated to treat as confidential, or return to the Company copies of any Confidential Material that (x) was publicly known at the time of disclosure to the Executive, (y) becomes publicly known or available thereafter other than by any means in violation of this Agreement or any other duty owed to the Company by any person or entity, or (z) is lawfully disclosed to the Executive by a third party.

(a)      The Executive acknowledges that the Executive’s employment with a competitor of the Company Group within a reasonable time following the termination of the Executive’s employment with the Company Group would create a substantial likelihood that the Executive would inevitably disclose or use, to the detriment of the Company Group, Confidential Material, and that it is essential to the Company Group’s legitimate business interests and also to free and fair competition in the industry within which the Company Group does business, to protect the Company Group’s Confidential Material from disclosure.

(b)      The risk of inevitable disclosure is particularly applicable to any such employment by the Executive with those competitors of the Company Group that are similar in operation, service, missions and markets to the Company Group (“Principal Competitors”). As of the date of this Agreement, the Principal Competitors are: Lincare Holdings, Inc.; Rotech Healthcare, Inc.; American HomePatient, Inc.; Coram Healthcare Corporation; Option Care, Inc.; Pacific Pulmonary Services Corporation; LifeCare Solutions, Inc.; and the home healthcare businesses of Air Products & Chemicals, Inc. and Praxair, Inc. and their respective parent, affiliated and subsidiary companies.

(c)      In order avoid the disclosure by the Executive of the Company’s trade secrets or other Confidential Material to those businesses that could most adversely affect the performance of the Company Group and damage its goodwill, the Executive agrees that, during the period of the Executive’s employment by the Company and for a period of one year following the date on which the Executive’s employment with the Company Group terminates for any reason (the “Post-Termination Period”), the Executive will not engage, directly or indirectly, in business with or work with or for, whether as an owner, employee, consultant or otherwise, any Principal Competitor; provided, however, that this restriction shall not prevent the Executive from owning less than 1% of any class of publicly-traded securities (or other equity interests held through a publicly-traded mutual fund or similar investment) of a Principal Competitor following the termination of the Executive’s employment with the Company. The Executive expressly acknowledges and agrees that the foregoing restriction is reasonable and necessary in order to protect the Confidential Material of the Company Group. The phrase “engage, directly or indirectly” means engaging or having an interest in, directly or indirectly, as owner, partner, participant of a joint venture, trustee, proprietor, shareholder, member, manager, director, officer, employee, independent contractor, capital investor, lender, consultant, advisor or similar capacity.

(a)      During the term of the Executive’s employment with the Company and during the Post-Termination Period, the Executive will not, directly or indirectly, individually or as a consultant to, or as an employee, officer, stockholder, director or other owner or participant in any business, influence or attempt to influence customers, patients, referral sources, vendors, suppliers, licensors, lessors, joint venturers, associates, consultants, agents, or partners of the Company Group, either directly or indirectly, to divert their business away from the Company Group, to any individual, partnership, firm, corporation or other entity then in competition with the business of any entity within the Company Group, and the Executive will not otherwise interfere with, disrupt or attempt to disrupt the business relationships, contractual or otherwise, between the Company, any of its respective affiliates or subsidiaries, and any customers, suppliers, vendors, lessors, licensors, joint venturers, associates, officers, employees, consultants, managers, partners, members of or investors in any entity within the Company Group.

(b)      During the term of the Executive’s employment with the Company and during the Post-Termination Period, the Executive will not on behalf of any individual or entity (other than the Company Group) directly or indirectly (i) induce, encourage or otherwise solicit (or assist in soliciting) any person who is an employee, independent contractor, consultant or business partner of any entity within the Company Group to terminate his, her or its employment relationship, contract, consulting relationship or partnership arrangement with such entity to accept any other employment or position; or (ii) assist any other entity in hiring any such employee, independent contractor, consultant or business partner.