Exhibit
10.3
COMPOSITE AMEDISYS,
INC.
1998 STOCK OPTION PLAN
1
ARTICLE
I—PLAN
1.1 Purpose . This
Plan is a plan for key Employees (including officers and employee
directors) and Consultants of the Company and its Affiliates and is
intended to advance the best interests of the Company, its
Affiliates, and its stockholders by providing those persons who
have substantial responsibility for the management and growth of
the Company and its Affiliates with additional incentives and an
opportunity to obtain or increase their proprietary interest in the
Company, thereby encouraging them to continue in the employ of the
Company or any of its Affiliates.
1.2 Rule 16b-3 Plan .
The Company is subject to the reporting requirements of the
Securities Exchange Act of 1934, as amended (the “1934
Act”), and therefore the Plan is intended to comply with all
applicable conditions of Rule 16b-3 (and all subsequent revisions
thereof) promulgated under the 1934 Act. To the extent any
provision of the Plan or action by the Board of Directors or
Committee fails to so comply, it shall be deemed null and void, to
the extent permitted by law and deemed advisable by the Committee.
In addition, the Board of Directors may amend the Plan from time to
time as it deems necessary in order to meet the requirements of any
amendments to Rule 16b-3 without the consent of the shareholders of
the Company.
1.3 Effective Date Of
Plan . The Plan shall be effective January 1998 (the
“Effective Date”), provided that within one year of the
Effective Date, the Plan shall have been approved by at least a
majority vote of stockholders voting in person or by proxy at a
duly held stockholders’ meeting, or if the provisions of the
corporate charter, by-laws or applicable state law prescribes a
greater degree of stockholder approval for this action, the
approval by the holders of that percentage, at a duly held meeting
of stockholders. No Incentive Option, Nonqualified Option, Stock
Appreciation Right, Restricted Stock Award or Performance Stock
Award shall be granted pursuant to the Plan ten years after the
Effective Date.
ARTICLE
II—DEFINITIONS
The words and phrases defined in
this Article shall have the meaning set out in these definitions
throughout this Plan, unless the context in which any such word or
phrase appears reasonably requires a broader, narrower, or
different meaning.
2.1 “Affiliate”
means any parent corporation and any subsidiary corporation. The
term “parent corporation” means any corporation (other
than the Company) in an unbroken chain of corporations ending with
the Company if, at the time of the action or transaction, each of
the corporations other than the Company owns stock possessing 50%
or more of the total combined voting power of all classes of stock
in one of the other corporations in the chain. The term
“subsidiary corporation” means any corporation (other
than the Company) in an unbroken chain of corporations beginning
with the Company if, at the time of the action or transaction, each
of the corporations other than the last corporation in the unbroken
chain owns stock possessing 50% or more of the total combined
voting power of all classes of stock in one of the other
corporations in the chain.
2.2 “Award” means
each of the following granted under this Plan: Incentive Option,
Nonqualified Option, Stock Appreciation Right, Restricted Stock
Award or Performance Stock Award.
2.3 “Board Of
Directors” means the board of directors of the
Company.
2.4 “Change In
Control” shall mean and include the following
transactions or situations: (a) A sale, transfer, or other
disposition by the Company through a single transaction or a series
of transactions of securities of the Company representing thirty
(30%) percent or more of the combined voting power of the
Company’s then outstanding securities to any “Unrelated
Person” or “Unrelated Persons” acting in concert
with one another. For purposes of this definition, the term
“Person” shall mean and include any individual,
partnership, joint venture, association, trust corporation, or
other entity (including a “group” as referred to in
Section 13(d)(3) of the 1934 Act). For purposes of this
definition, the term “Unrelated Person” shall mean and
include any Person other than the Company, a wholly-owned
subsidiary of the Company, or an employee benefit plan of the
Company; provided
|
1
|
Encompassing Plan amendments dated
June 10, 2004, and the full text of the 1998 Amedisys, Inc. Amended
and Restated Stock Option Plan
|
however, a sale to underwriters in connection
with a public offering of the Company’s securities pursuant
to a firm commitment shall not be a Change of Control. (b) A
sale, transfer, or other disposition through a single transaction
or a series of transactions of all or substantially all of the
assets of the Company to an Unrelated Person or Unrelated Persons
acting in concern with one another. (c) A change in the
ownership of the Company through a single transaction or a series
of transactions such that any Unrelated Person or Unrelated Persons
acting in concert with one another become the “Beneficial
Owner,” directly or indirectly, of securities of the Company
representing at least thirty (30%) percent of the combined
voting power of the Company’s then outstanding securities.
For purposes of this definition, the term “Beneficial
Owner” shall have the same meaning as given to that term in
Rule 13d-3 promulgated under the 1934 Act, provided that any
pledgee of voting securities is not deemed to be the Beneficial
Owner thereof prior to its acquisition of voting rights with
respect to such securities. (d) Any consolidation or merger of
the Company with or into an Unrelated Person, unless immediately
after the consolidation or merger the holders of the common stock
of the Company immediately prior to the consolidation or merger are
the beneficial owners of securities of the surviving corporation
representing at least fifty (50%) percent of the combined
voting power of the surviving corporation’s then outstanding
securities. (e) During any period of two years, individuals
who, at the beginning of such period, constituted the Board of
Directors of the Company cease, for any reason, to constitute at
least a majority thereof, unless the election or nomination for
election of each new director was approved by the vote of at least
two-thirds of the directors then still in office who were directors
at the beginning of such period. (f) A change in control of
the Company of a nature that would be required to be reported in
response to Item 6(e) of Schedule 14A of Regulation 14A
promulgated under the 1934 Act, or any successor regulation of
similar importance, regardless of whether the Company is subject to
such reporting requirement.
2.5 “Code” means
the Internal Revenue Code of 1986, as amended.
2.6 “Committee”
means the Compensation Committee of the Board of Directors or such
other committee designated by the Board of Directors. The Committee
shall be comprised solely of at least two members who are both
Disinterested Persons and Outside Directors.
2.7 “Company”
means AMEDISYS, INC.
2.8 “Consultant”
means any person, including an advisor, engaged by the Company or
Affiliate to render services and who is compensated for such
services.
2.9 “Disinterested
Person” means a “disinterested person” as
that term is defined in Rule 16b-3 under the 1934 Act.
2.10 “Eligible
Persons” shall mean, with respect to the Plan, those
persons who, at the time that an Award is granted, are (i) key
personnel (including officers and directors) of the Company or
Affiliate, or (ii) Consultants or independent contractors who
provide valuable services to the Company or Affiliate as determined
by the Committee.
2.11 “Employee”
means a person employed by the Company or any Affiliate to whom an
Award is granted.
2.12 “Fair Market
Value” of the Stock as of any date means (a) the
average of the high and low sale prices of the Stock on that date
on the principal securities exchange on which the Stock is listed;
or (b) if the Stock is not listed on a securities exchange,
the average of the high and low sale prices of the Stock on that
date as reported on the Nasdaq National Market System; or
(c) if the Stock is not listed on the Nasdaq National Market
System, the average of the high and low bid quotations for the
Stock on that date as reported by the National Quotation Bureau
Incorporated; or (d) if none of the foregoing is applicable,
an amount at the election of the Committee equal to (x), the
average between the closing bid and ask prices per share of Stock
on the last preceding date on which those prices were reported or
(y) that amount as determined by the Committee in good
faith.
2.13 “Incentive
Option” means an option to purchase Stock granted under
this Plan which is designated as an “Incentive Option”
and satisfies the requirements of Section 422 of the
Code.
2.14 “Nonqualified
Option” means an option to purchase Stock granted under
this Plan other than an Incentive Option.
2.15 “Option”
means both an Incentive Option and a Nonqualified Option granted
under this Plan to purchase shares of Stock.
2.16 “Option
Agreement” means the written agreement by and between the
Company and an Eligible Person which sets out the terms of an
Option.
2.17 “Outside
Director” means a member of the Board of Directors
serving on the Committee who satisfies Section 162(m) of the
Code.
2.18 “Plan” means
the Amedisys, Inc. 1998 Stock Option Plan, as set out in this
document and as it may be amended from time to time.
2.19 “Plan Year”
means the Company’s fiscal year.
2.20 “Performance Stock
Award” means an award of shares of Stock to be issued to
an Eligible Person if specified predetermined performance goals are
satisfied as described in Article VI.
2.21 “Restricted
Stock” means Stock awarded or purchased under a
Restricted Stock Agreement entered into pursuant to this Plan,
together with (i) all rights, warranties or similar items
attached or accruing thereto or represented by the certificate
representing the stock and (ii) any stock or securities into
which or for which the stock is thereafter converted or exchanged.
The terms and conditions of the Restricted Stock Agreement shall be
determined by the Committee consistent with the terms of the
Plan.
2.22 “Restricted Stock
Agreement” means an agreement between the Company or any
Affiliate and the Eligible Person pursuant to which the Eligible
Person receives a Restricted Stock Award subject to Article
VI.
2.23 “Restricted Stock
Award” means an Award of Restricted Stock.
2.24 “Restricted Stock
Purchase Price” means the purchase price, if any, per
share of Restricted Stock subject to an Award. The Restricted Stock
Purchase Price shall be determined by the Committee. It may be
greater than or less than the Fair Market Value of the Stock on the
date of the Stock Award.
2.25 “Stock”
means the common stock of the Company, $.001 par value or, in the
event that the outstanding shares of common stock are later changed
into or exchanged for a different class of stock or securities of
the Company or another corporation, that other stock or
security.
2.26 “Stock Appreciation
Right” and “SAR” means the right to receive
the difference between the Fair Market Value of a share of Stock on
the grant date and the Fair Market Value of the share of Stock on
the exercise date.
2.27 “10%
Stockholder” means an individual who, at the time the
Option is granted, owns Stock possessing more than 10% of the total
combined voting power of all classes of stock of the Company or of
any Affiliate. An individual shall be considered as owning the
Stock owned, directly or indirectly, by or for his brothers and
sisters (whether by the whole or half blood), spouse, ancestors,
and lineal descendants; and Stock owned, directly or indirectly, by
or for a corporation, partnership, estate, or trust, shall be
considered as being owned proportionately by or for its
stockholders, partners, or beneficiaries.
ARTICLE
III—ELIGIBILITY
The individuals who shall be
eligible to receive Awards shall be those Eligible Persons of the
Company or any of its Affiliates as the Committee shall determine
from time to time. However, no member of the Committee shall be
eligible to receive any Award or to receive Stock, Options, Stock
Appreciation Rights or any Performance Stock Award under any other
plan of the Company or any of its Affiliates, if to do so would
cause the individual not to be a Disinterested Person or Outside
Director. The Board of Directors of Directors may designate one or
more individuals who shall not be eligible to receive any Award
under this Plan or under other similar plans of the
Company.
ARTICLE IV—GENERAL
PROVISIONS RELATING TO AWARDS
4.1 Authority To Grant
Awards . The Committee may grant to those Eligible Persons
of the Company or any of its Affiliates as it shall from time to
time determine, Awards under the terms and conditions of this Plan.
Subject only to any applicable limitations set out in this Plan,
the number of shares of Stock to be covered by any Award to be
granted to an Eligible Person shall be determined by the
Committee.
4.2 Dedicated Shares .
The total number of shares of Stock with respect to which Awards
may be granted under the Plan shall be 2,125,000 shares. The shares
may be treasury shares or authorized but unissued shares. [THE
MAXIMUM NUMBER OF SHARES SUBJECT TO OPTIONS OR STOCK APPRECIATION
RIGHTS WHICH MAY BE ISSUED TO ANY ELIGIBLE PERSON UNDER THE PLAN
DURING EACH PLAN YEAR SHALL BE DETERMINED BY THE COMPENSATION
COMMITTEE. THE MAXIMUM NUMBER OF SHARES SUBJECT TO RESTRICTED STOCK
AWARDS WHICH MAY BE GRANTED TO ANY ELIGIBLE PERSON UNDER THE PLAN
DURING EACH PLAN YEAR SHALL BE DETERMINED BY THE COMPENSATION
COMMITTEE. THE MAXIMUM NUMBER OF SHARES SUBJECT TO PERFORMANCE
STOCK AWARDS WHICH MAY BE GRANTED TO ANY ELIGIBLE PERSON DURING
EACH PLAN YEAR SHALL BE DETERMINED BY THE COMPENSATION COMMITTEE.]
The number of shares stated in this Section 4.2 shall be
subject to adjustment in accordance with the provisions of
Section 4.5. In the event that any outstanding Award shall
expire or terminate for any reason or any Award is surrendered, the
shares of Stock allocable to the unexercised portion of that Award
may again be subject to an Award under the Plan.
4.3
Non-Transferability . Awards shall not be
transferable by the Eligible Person otherwise than by will or under
the laws of descent and distribution, and shall be exercisable,
during the Eligible Person’s lifetime, only by him.
Restricted Stock shall be purchased by and/or become vested under a
Restricted Stock Agreement during the Eligible Person’s
lifetime, only by him. Any attempt to transfer an Award other than
under the terms of the Plan and the Agreement shall terminate the
Award and all rights of the Eligible Person to that
Award.
4.4 Requirements Of
Law . The Company shall not be required to sell or issue
any Stock under any Award if issuing that Stock would constitute or
result in a violation by the Eligible Person or the Company of any
provision of any law, statute, or regulation of any governmental
authority. Specifically, in connection with any applicable statute
or regulation relating to the registration of securities, upon
exercise of any Option or pursuant to any Award, the Company shall
not be required to issue any Stock unless the Committee has
received evidence satisfactory to it to the effect that the holder
of that Option or Award will not transfer the Stock except in
accordance with applicable law, including receipt of an opinion of
counsel satisfactory to the Company to the effect that any proposed
transfer complies with applicable law. The determination by the
Committee on this matter shall be final, binding and conclusive.
The Company may, but shall in no event be obligated to, register
any Stock covered by this Plan pursuant to applicable securities
laws of any country or any political subdivision. In the event the
Stock issuable on exercise of an Option or pursuant to an Award is
not registered, the Company may imprint on the certificate
evidencing the Stock any legend that counsel for the Company
considers necessary or advisable to comply with applicable law. The
Company shall not be obligated to take any other affirmative action
in order to cause the exercise of an Option or vesting under an
Award, or the issuance of shares pursuant thereto, to comply with
any law or regulation of any governmental authority.
4.5 Changes In The
Company’s Capital Structure . (a) The existence
of outstanding Options or Awards shall not affect in any way the
right or power of the Company or its stockholders to make or
authorize any or all adjustments, recapitalizations,
reorganizations or other changes in the Company’s capital
structure or its
business, or any merger or consolidation of the
Company, or any issue of bonds, debentures, preferred or prior
preference stock ahead of or affecting the Stock or its rights, or
the dissolution or liquidation of the Company, or any sale or
transfer of all or any part of its assets or business, or any other
corporate act or proceeding, whether of a similar character or
otherwise. If the Company shall effect a subdivision or
consolidation of shares or other capital readjustment, the payment
of a Stock dividend, or other increase or reduction of the number
of shares of the Stock outstanding, without receiving compensation
for it in money, services or property, then (a) the number,
class, and per share price of shares of Stock subject to
outstanding Options under this Plan shall be appropriately adjusted
in such a manner as to entitle an Eligible Person to receive upon
exercise of an Option, for the same aggregate cash consideration,
the equivalent total number and class of shares he would have
received had he exercised his Option in full immediately prior to
the event requiring the adjustment; and (b) the number and
class of shares of Stock then reserved to be issued under the Plan
shall be adjusted by substituting for the total number and class of
shares of Stock then reserved, that number and class of shares of
Stock that would have been received by the owner of an equal number
of outstanding shares of each class of Stock as the result of the
event requiring the adjustment. (b) If the Company is merged
or consolidated with another corporation and the Company is not the
surviving corporation, or if the Company is liquidated or sells or
otherwise disposes of substantially all its assets while
unexercised Options remain outstanding under this Plan:
(i) subject to the provisions of clause (c) below, after
the effective date of the merger, consolidation, liquidation, sale
or other disposition, as the case may be, each holder of an
outstanding Option shall be entitled, upon exercise of the Option,
to receive, in lieu of shares of Stock, the number and class or
classes of shares of stock or other securities or property to which
the holder would have be entitled if, immediately prior to the
merger, consolidation, liquidation, sale or other disposition, the
holder had been the holder of record of a number of shares of Stock
equal to the number of shares as to which the Option shall be so
exercised; (ii) the Board of Directors may waive any
limitations set out in or imposed under this Plan so that all
Options, from and after a date prior to the effective date of the
merger, consolidation, liquidation, sale or other disposition, as
the case may be, specified by the Board of Directors, shall be
exercisable in full; and (iii) all outstanding Options may be
canceled by the Board of Directors as of the effective date of any
merger, consolidation, liquidation, sale or other disposition, if
(i) notice of cancellation shall be given to each holder of an
Option and (ii) each holder of an Option shall have the right
to exercise that Option in full (without regard to any limitations
set out in or imposed under this Plan or the Option Agreement
granting that Option) during a period set by the Board of Directors
preceding the effective date of the merger, consolidation,
liquidation, sale or other disposition and, if in the event all
outstanding Options may not be exercised in full under applicable
securities laws without registration of the shares of Stock
issuable on exercise of the Options, the Board of Directors may
limit the exercise of the Options to the number of shares of Stock,
if any, as may be issued without registration. The method of
choosing which Options may be exercised, and the number of shares
of Stock for which Options may be exercised, shall be solely within
the discretion of the Board of Directors. (c) After a merger
of one or more corporations into the Company or after a
consolidation of the Company and one or more corporations in which
the Company shall be the surviving corporation, each Eligible
Person shall be entitled to have his Restricted Stock and shares
earned under a Performance Stock Award appropriately adjusted based
on the manner the Stock was adjusted under the terms of the
agreement of merger or consolidation. (d) In each situation
described in this Section 4.5, the Committee will make similar
adjustments, as appropriate, in outstanding Stock Appreciation
Rights. (e) The issuance by the Company of shares of stock of
any class, or securities convertible into shares of stock of any
class, for cash or property, or for labor or services either upon
direct sale or upon the exercise of rights or warrants to subscribe
for them, or upon conversion of shares or obligations of the
Company convertible into shares or other securities, shall not
affect, and no adjustment by reason of such issuance shall be made
with respect to, the number, class, or price of shares of Stock
then subject to outstanding Awards.
4.6 Election Under
Section 83(B) Of The Code . No Employee shall exercise
the election permitted under Section 83(b) of the Code without
written approval of the Committee. Any Employee doing so shall
forfeit all Awards issued to him under this Plan.
ARTICLE V—OPTIONS AND STOCK
APPRECIATION RIGHTS
5.1 Type Of Option .
The Committee shall specify at the time of grant whether a given
Option shall constitute an Incentive Option or a Nonqua
